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EXECUTION COPY
EXHIBIT 4.4
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PPL CORPORATION
and
THE CHASE MANHATTAN BANK,
as Purchase Contract Agent
PURCHASE CONTRACT AGREEMENT
Dated as of May 9, 2001
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TABLE OF CONTENTS
PAGE
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RECITALS...........................................................................1
ARTICLE 1 Definitions and Other Provisions of
General Applications..............................................1
SECTION 1.01. Definitions.......................................................1
SECTION 1.02. Compliance Certificates and Opinions.............................17
SECTION 1.03. Form of Documents Delivered to Purchase Contract Agent...........18
SECTION 1.04. Acts of Holders; Record Dates....................................18
SECTION 1.05. Notices..........................................................20
SECTION 1.06. Notice to Holders; Waiver........................................21
SECTION 1.07. Effect of Headings and Table of Contents.........................21
SECTION 1.08. Successors and Assigns...........................................21
SECTION 1.09. Separability Clause..............................................21
SECTION 1.10. Benefits of Agreement............................................22
SECTION 1.11. Governing Law....................................................22
SECTION 1.12. Legal Holidays...................................................22
SECTION 1.13. Counterparts.....................................................22
SECTION 1.14. Inspection of Agreement..........................................23
SECTION 1.15. Appointment of Financial Institution as Agent for the Company....23
ARTICLE 2 Certificate Forms................................................23
SECTION 2.01. Forms of Certificates Generally..................................23
SECTION 2.02. Form of Purchase Contract Agent's Certificate of Authentication..24
ARTICLE 3 The Securities...................................................24
SECTION 3.01. Amount; Form and Denominations...................................24
SECTION 3.02. Rights and Obligations Evidenced by the Certificates.............25
SECTION 3.03. Execution, Authentication, Delivery and Dating...................26
SECTION 3.04. Temporary Certificates...........................................26
SECTION 3.05. Registration; Registration of Transfer and Exchange..............27
SECTION 3.06. Book-entry Interests.............................................28
SECTION 3.07. Notices to Holders...............................................29
SECTION 3.08. Appointment of Successor Depositary..............................29
SECTION 3.09. Definitive Certificates..........................................29
SECTION 3.10. Mutilated, Destroyed, Lost and Stolen Certificates...............30
SECTION 3.11. Persons Deemed Owners............................................31
SECTION 3.12. Cancellation.....................................................32
SECTION 3.13. Creation of Treasury PEPS Units by
Substitution of Treasury Securities..............................32
SECTION 3.14. Reestablishment of PEPS Units....................................34
SECTION 3.15. Transfer of Collateral upon Occurrence of Termination Event......35
SECTION 3.16. No Consent to Assumption.........................................36
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SECTION 3.17. CUSIP Numbers....................................................37
ARTICLE 4 The Preferred Securities, Subordinated Notes and
Applicable Ownership Interest of the Treasury Portfolio..........37
SECTION 4.01. Distributions and Interest Payments; Rights to
Distributions and Interest Payments Preserved....................37
SECTION 4.02. Notice and Voting................................................39
SECTION 4.03. Distribution of Subordinated Notes; Tax Event Redemption.........40
ARTICLE 5 The Purchase Contracts...........................................41
SECTION 5.01. Purchase of Shares of Common Stock...............................41
SECTION 5.02. Initial and Additional Remarketing...............................43
SECTION 5.02.A. Contract Adjustment Payments.....................................46
SECTION 5.03. Payment of Purchase Price; Final Remarketing.....................51
SECTION 5.03.A. Failed Final Remarketing.........................................56
SECTION 5.04. Issuance of Shares of Common Stock...............................56
SECTION 5.05. Adjustment of Settlement Rate....................................57
SECTION 5.06. Notice of Adjustments and Certain Other Events...................63
SECTION 5.07. Termination Event; Notice........................................64
SECTION 5.08. Early Settlement.................................................64
SECTION 5.09. No Fractional Shares.............................................66
SECTION 5.10. Charges and Taxes................................................67
ARTICLE 6 Remedies.........................................................67
SECTION 6.01. Unconditional Right of Holders to Receive Contract
Adjustment Payments and to Purchase Shares of Common Stock.......67
SECTION 6.02. Restoration of Rights and Remedies...............................67
SECTION 6.03. Rights and Remedies Cumulative...................................68
SECTION 6.04. Delay or Omission Not Waiver.....................................68
SECTION 6.05. Undertaking for Costs............................................68
SECTION 6.06. Waiver of Stay or Extension Laws.................................68
ARTICLE 7 The Purchase Contract Agent......................................69
SECTION 7.01. Certain Duties and Responsibilities..............................69
SECTION 7.02. Notice of Default................................................70
SECTION 7.03. Certain Rights of Purchase Contract Agent........................70
SECTION 7.04. Not Responsible for Recitals or Issuance of Securities...........72
SECTION 7.05. May Hold Securities..............................................72
SECTION 7.06. Money Held in Custody............................................72
SECTION 7.07. Compensation and Reimbursement...................................72
SECTION 7.08. Corporate Purchase Contract Agent Required; Eligibility..........73
SECTION 7.09. Resignation and Removal; Appointment of Successor................73
SECTION 7.10. Acceptance of Appointment by Successor...........................75
SECTION 7.11. Merger, Conversion, Consolidation or Succession to Business......75
SECTION 7.12. Preservation of Information; Communications to Holders...........76
SECTION 7.13. No Obligations of Purchase Contract Agent........................76
SECTION 7.14. Tax Compliance...................................................76
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ARTICLE 8 Supplemental Agreements..........................................77
SECTION 8.01. Supplemental Agreements Without Consent of Holders...............77
SECTION 8.02. Supplemental Agreements with Consent of Holders..................78
SECTION 8.03. Execution of Supplemental Agreements.............................79
SECTION 8.04. Effect of Supplemental Agreements................................79
SECTION 8.05. Reference to Supplemental Agreements.............................79
ARTICLE 9 Merger, Consolidation, Share Exchange, Sale or Conveyance........80
SECTION 9.01. Covenant Not to Merge, Consolidate, Enter into a Share
Exchange, Sell or Convey Property Except Under Certain
Conditions.....................................................80
SECTION 9.02. Rights and Duties of Successor Corporation.......................80
SECTION 9.03. Officers' Certificate and Opinion of Counsel Given to
Purchase Contract Agent..........................................81
ARTICLE 10 Covenants........................................................81
SECTION 10.01. Performance under Purchase Contracts.............................81
SECTION 10.02. Maintenance of Office or Agency..................................81
SECTION 10.03. Company to Reserve Common Stock..................................82
SECTION 10.04. Covenants as to Common Stock.....................................82
SECTION 10.05. Statements of Officers of the Company as to Default..............82
SECTION 10.06. ERISA............................................................83
Exhibit A Face of PEPS Units Certificate
Exhibit B Face of Treasury PEPS Certificate
Exhibit C Instruction to Purchase Contract Agent
Exhibit D Notice from Purchase Contract Agent to Holders
Exhibit E Notice to Settle by Cash
Exhibit F Notice from Purchase Contract Agent to Remarketing Agent, Collateral Agent and
Indenture Trustee and the Company
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PURCHASE CONTRACT AGREEMENT, dated as of May 9, 2001, (the "AGREEMENT")
between PPL CORPORATION, a Pennsylvania corporation (the "COMPANY"), and THE
CHASE MANHATTAN BANK, a New York banking corporation, acting as purchase
contract agent for the Holders of Securities (as defined herein) from time to
time (the "PURCHASE CONTRACT AGENT").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the Securities.
All things necessary to make the Purchase Contracts, when the
Certificates are executed by the Company and authenticated, executed on behalf
of the Holders and delivered by the Purchase Contract Agent, as provided in this
Agreement, the valid obligations of the Company, and to constitute these
presents a valid agreement of the Company, in accordance with its terms, have
been done. For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATIONS
SECTION 1.01. Definitions.
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them
in this Article and include the plural as well as the singular, and nouns and
pronouns of the masculine gender include the feminine and neuter genders;
(b) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles in
the United States;
(c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section, Exhibit or other subdivision;
(d) the following terms have the meanings given to them in the Trust
Agreement: (a) Tax Event Redemption; (b) Tax Event; (c)Trust; (d)Trust
Agreement;
(e) the following term has the meaning given to it in the Remarketing
Agreement: (a) Remarketing; and (b) Remarketing Procedures;
(f) the following terms have the meanings given to them in this Section
1.01(f):
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"ACT" has the meaning, with respect to any Holder, set forth in Section
1.04.
"ADDITIONAL REMARKETING" has the meaning set forth in Section 5.02.
"AFFILIATE" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"AGREEMENT" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"APPLICABLE AMOUNT" means the aggregate liquidation amount of the
Preferred Securities or the aggregate principal amount of the Subordinated Notes
which are components of PEPS Units on the Initial Remarketing Date.
"APPLICABLE MARKET VALUE" has the meaning set forth in Section 5.01.
"APPLICABLE OWNERSHIP INTEREST" means, with respect to a PEPS Unit and
the U.S. Treasury securities in the Treasury Portfolio, (A) a 1/40, or 2.5%,
undivided beneficial ownership interest in a $1,000 principal or interest amount
of a principal or interest strip in a U.S. Treasury security included in such
Treasury Portfolio which matures on or prior to May 17, 2004 and (B) for the
scheduled interest payment date on the Preferred Securities or Subordinated
Notes, as the case may be, that occurs on the Purchase Contract Settlement Date,
in the case of a Successful Initial Remarketing, or for each scheduled interest
payment date on the Preferred Securities or Subordinated Notes, as the case may
be, that occurs after the Tax Event Redemption Date and on or before the
Purchase Contract Settlement Date, in the case of a Tax Event Redemption, a
0.0456% undivided beneficial ownership interest in a $1,000 principal or
interest amount of a principal or interest strip in a U.S. Treasury security
included in the Treasury Portfolio that matures on or prior to that interest
payment date.
"APPLICABLE SPREAD" means the spread determined as set forth below,
based on the Prevailing Rating of the Subordinated Notes in effect at the close
of business on the Business Day immediately preceding the date of a Failed Final
Remarketing.
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PREVAILING RATING OF THE SUBORDINATED NOTES SPREAD
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AA/"Aa".......................................... 3.00%
A/"a"............................................ 4.00%
BBB/"Baa"........................................ 5.00%
Below BBB/"Baa".................................. 7.00%
"APPLICANTS" has the meaning set forth in Section 7.12(b).
"AUTHORIZED NEWSPAPER" means a daily newspaper, in the English language,
customarily published on each day that is a Business Day in The City of New
York, whether or not published on days that are legal holidays, and of general
circulation in The City of New York. The Authorized Newspaper for the purposes
of the Reset Announcement Date is currently anticipated to be The Wall Street
Journal.
"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.
"BENCHMARK TREASURY" means direct obligations of the United States
(which may be obligations traded on a when-issued basis only) having a maturity
comparable to the remaining term to maturity of the Subordinated Notes, as
agreed upon by the Company and the Reset Agent. The rate for the Benchmark
Treasury will be the bid side rate displayed at 10:00 A.M., New York City time,
(i) in case of the first Initial Remarketing on the third Business Day
immediately preceding February 18, 2004 and in the case of the Final Remarketing
on the third Business day immediately preceding May 18, 2004, on the seventh
Business Day immediately preceding the date of such remarketing, and (ii) and in
the case of any Additional Remarketing on the fourth Business Day immediately
preceding the date on which the Preferred Securities will be remarketed, in the
Telerate system (or if the Telerate system is (a) no longer available on that
date or (b) in the opinion of the Reset Agent (after consultation with the
Company) no longer an appropriate system from which to obtain such rate, such
other nationally recognized quotation system as, in the opinion of the Reset
Agent (after consultation with the Company) is appropriate). If such rate is not
so displayed, the rate for the Benchmark Treasury shall be, as calculated by the
Reset Agent, the yield to maturity for the Benchmark Treasury, expressed as a
bond equivalent on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis, and computed by taking the arithmetic mean of the
secondary market bid rates, as of 10:30 A.M., New York City time, (i) in case of
the first Initial Remarketing on the third Business Day immediately preceding
February 18, 2004 and in the case of the Final Remarketing on the third Business
Day immediately preceding May 18, 2004, on the seventh Business Day immediately
preceding the date of such remarketing, and (ii) in the case of any Additional
Remarketing, on the fourth Business Day immediately preceding the date of such
Remarketing, as applicable, of three leading United States government securities
dealers selected by the Reset Agent (after consultation with the Company) (which
may include the Reset Agent or an Affiliate thereof).
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"BENEFICIAL OWNER" means, with respect to a Book-Entry Interest, a
Person who is the beneficial owner of such Book-Entry Interest as reflected on
the books of the Depositary or on the books of a Person maintaining an account
with such Depositary (directly as a Depositary Participant or as an indirect
participant, in each case in accordance with the rules of such Depositary).
"BOARD OF DIRECTORS" means the board of directors of the Company or a
duly authorized committee of that board.
"BOARD RESOLUTION" means one or more resolutions of the Board of
Directors, a copy of which has been certified by the Secretary or an Assistant
Secretary of the Company to have been duly adopted by the Board of Directors and
to be in full force and effect on the date of such certification and delivered
to the Purchase Contract Agent.
"BOOK-ENTRY INTEREST" means a beneficial interest in a Global
Certificate, registered in the name of a Depositary or a nominee thereof,
ownership and transfers of which shall be maintained and made through book
entries by such Depositary as described in Section 3.06.
"BUSINESS DAY" means any day other than a Saturday or Sunday or a day on
which banking institutions in New York City are authorized or required by law or
executive order to remain closed or a day on which the Indenture Trustee or the
Property Trustee is closed for business; provided that for purposes of the
second paragraph of Section 1.12 only, the term "Business Day" shall also be
deemed to exclude any day on which trading on the New York Stock Exchange, Inc.
is closed or suspended.
"CASH" shall have the meaning set forth in Section 1.0 of the Pledge
Agreement.
"CASH SETTLEMENT" has the meaning set forth in Section 5.03(a)(i).
"CERTIFICATE" means a PEPS Units Certificate or a Treasury PEPS Units
Certificate.
"CLEARING AGENCY" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as a
depositary for the Securities and in whose name, or in the name of a nominee of
that organization, shall be registered a Global Certificate and which shall
undertake to effect book-entry transfers and pledges of the Securities.
"CLOSING PRICE" has the meaning set forth in Section 5.01.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COLLATERAL" has the meaning set forth in Section 1.01 of the Pledge
Agreement.
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"COLLATERAL ACCOUNT" has the meaning set forth in Section 1.01 of the
Pledge Agreement.
"COLLATERAL AGENT" means The Bank of New York, as Collateral Agent under
the Pledge Agreement until a successor Collateral Agent shall have become such
pursuant to the applicable provisions of the Pledge Agreement, and thereafter
"Collateral Agent" shall mean the Person who is then the Collateral Agent
thereunder.
"COLLATERAL SUBSTITUTION" has the meaning set forth in Section 3.13.
"COMMON STOCK" means the PPL Corporation common stock, par value $0.01
per share.
"COMPANY" means the Person named as the "Company" in the first paragraph
of this instrument until a successor shall have become such pursuant to the
applicable provision of this Agreement, and thereafter "Company" shall mean such
successor.
"CONSTITUENT PERSON" has the meaning set forth in Section 5.05(b).
"CONTRACT ADJUSTMENT PAYMENTS" means in the case of PEPS Units and
Treasury PEPS Units the amount payable by the Company in respect of each
Purchase Contract constituting a part of a PEPS Unit or Treasury PEPS Unit,
equal to 0.46 % per annum of the Stated Amount, or $0.1150 per annum, in each
case computed on the basis of a 360-day year of twelve 30-day months.
"CORPORATE TRUST OFFICE" means the principal corporate trust office of
the Purchase Contract Agent at which, at any particular time, its corporate
trust business shall be administered, which office at the date hereof is located
at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Institutional
Trust Services.
"COUPON RATE" means the percentage rate per annum at which distributions
are payable for each Preferred Security initially, or the percentage rate per
annum at which each Subordinated Note will bear interest initially and,
following a Successful Initial Remarketing or a Successful Final Remarketing, as
the case may be, on and after the Reset Effective Date, the Reset Rate as
calculated by the Reset Agent, or following a Failed Final Remarketing, on and
after May 18, 2004, the Reset Rate that will be equal to the Two-Year Benchmark
Treasury in effect on the Final Remarketing Date plus the Applicable Spread.
"CURRENT MARKET PRICE" has the meaning set forth in Section 5.05(a)(8).
"DEPOSITARY" means a clearing agency registered under the Exchange Act
that is designated to act as Depositary for the Securities as contemplated by
Sections 3.06, 3.07, 3.08 and 3.09.
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"DEPOSITARY PARTICIPANT" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time the Depositary effects
book entry transfers and pledges of securities deposited with the Depositary.
"DTC" means The Depository Trust Company.
"EARLY SETTLEMENT" has the meaning set forth in Section 5.08(a).
"EARLY SETTLEMENT AMOUNT" has the meaning set forth in Section 5.08(a).
"EARLY SETTLEMENT DATE" has the meaning set forth in Section 5.08(a).
"EARLY SETTLEMENT RATE" has the meaning set forth in Section 5.08(b).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
and any statute successor thereto, in each case as amended from time to time,
and the rules and regulations promulgated thereunder.
"EXPIRATION DATE" has the meaning set forth in Section 1.04(e).
"EXPIRATION TIME" has the meaning set forth in Section 5.05(a)(6).
"FAILED FINAL REMARKETING" has the meaning set forth in Section 5.03(b).
"FAILED INITIAL REMARKETING" has the meaning set forth in Section 5.02.
"FINAL REMARKETING" has the meaning set forth in Section 5.03(b).
"FINAL REMARKETING DATE" has the meaning set forth in Section 5.03(b).
"GLOBAL CERTIFICATE" means a Certificate that evidences all or part of
the Securities and is registered in the name of a Clearing Agency or a nominee
thereof.
"HOLDER" means, with respect to a Security, the Person in whose name the
Security evidenced by a Certificate is registered in the Security Register;
provided, however, that in determining whether the Holders of the requisite
number of Securities have voted on any matter, then for the purpose of such
determination only (and not for any other purpose hereunder), if the Security
remains in the form of one or more Global Certificates and if the Depositary
which is the registered holder of such Global Certificate has sent an omnibus
proxy assigning voting rights to the Depositary Participants to whose accounts
the Securities are credited on the record date, the term "Holder" shall mean
such Depositary Participant acting at the direction of the Beneficial Owners.
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"INDENTURE" means the Subordinated Indenture, dated as of May 9, 2001,
between the Company and the Indenture Trustee (including any provisions of the
TIA that are deemed incorporated therein), as supplemented by the Supplemental
Indenture No. 1 dated as of May 9, 2001, pursuant to which the Subordinated
Notes will be issued.
"INDENTURE TRUSTEE" means The Chase Manhattan Bank, a New York banking
corporation, as trustee under the Indenture, or any successor thereto in such
capacity.
"INITIAL REMARKETING" has the meaning set forth in Section 5.02.
"INITIAL REMARKETING DATE" has the meaning set forth in Section 5.02.
"ISSUER ORDER" or "ISSUER REQUEST" means a written order or request
signed in the name of the Company by its Chairman of the Board, its President or
one of its Vice Presidents, and by its Treasurer, an Assistant Treasurer, its
Secretary or an Assistant Secretary, and delivered to the Purchase Contract
Agent.
"New York Office" shall have the meaning set forth in Section 10.02.
"NON-ELECTING SHARE" has the meaning set forth in Section 5.05(b).
"NYSE" means the New York Stock Exchange, Inc.
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of
the Board, its President or one of its Vice Presidents, and by the Treasurer, an
Assistant Treasurer, the Secretary or an Assistant Secretary of the Company, and
delivered to the Purchase Contract Agent. Any Officers' Certificate delivered
with respect to compliance with a condition or covenant provided for in this
Agreement shall include:
(i) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(ii) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering the
Officers' Certificate;
(iii) a statement that, in the opinion of each such officer,
each such officer has made such examination or investigation as is
necessary to enable such officer to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"OPINION OF COUNSEL" means a written opinion of counsel, who may be
counsel to the Company (and who may be an employee of the Company), and who
shall be reasonably acceptable to the Purchase Contract Agent or in the case of
an Opinion of
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Counsel delivered under the Pledge Agreement, reasonably acceptable to the
Collateral Agent, Securities Intermediary or Custodial Agent, as the case may
be. An opinion of counsel may rely on certificates as to matters of fact.
"OUTSTANDING SECURITIES" means, with respect to any Security and as of
the date of determination, all Securities evidenced by Certificates theretofore
authenticated, executed and delivered under this Agreement, except:
(iii) If a Termination Event has occurred, (i) Treasury PEPS
Units and (ii) PEPS Units for which the underlying Subordinated Notes
have been theretofore deposited with the Purchase Contract Agent in
trust for the Holders of such PEPS Units;
(iv) Securities evidenced by Certificates theretofore
cancelled by the Purchase Contract Agent or delivered to the Purchase
Contract Agent for cancellation or deemed cancelled pursuant to the
provisions of this Agreement; and
(v) Securities evidenced by Certificates in exchange for or
in lieu of which other Certificates have been authenticated, executed on
behalf of the Holder and delivered pursuant to this Agreement, other
than any such Certificate in respect of which there shall have been
presented to the Purchase Contract Agent proof satisfactory to it that
such Certificate is held by a protected purchaser in whose hands the
Securities evidenced by such Certificate are valid obligations of the
Company;
provided, however, that in determining whether the Holders of the requisite
number of the Securities have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Securities owned by the Company
or any Affiliate of the Company shall be disregarded and deemed not to be
Outstanding Securities, except that, in determining whether the Purchase
Contract Agent shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Securities that a
Responsible Officer of the Purchase Contract Agent knows to be so owned shall be
so disregarded. Securities so owned that have been pledged in good faith may be
regarded as Outstanding Securities if the pledgee establishes to the
satisfaction of the Purchase Contract Agent the pledgee's right so to act with
respect to such Securities and that the pledgee is not the Company or any
Affiliate of the Company.
"PAYMENT DATE" means for each year February 18, May 18, August 18, and
November 18, commencing August 18, 2001.
"PEPS UNIT" means the collective rights and obligations of a Holder of a
PEPS Units Certificate in respect of a Preferred Security, the Subordinated
Notes or an appropriate Applicable Ownership Interest of the Treasury Portfolio,
as the case may be, subject in each case to the Pledge thereof, and the related
Purchase Contract; provided,
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that the appropriate Applicable Ownership Interest (as specified in clause (B)
of the definition of such term) of the Treasury Portfolio shall not be subject
to the Pledge.
"PEPS UNITS CERTIFICATE" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of PEPS Units specified on such
certificate.
"PERMITTED INVESTMENTS" has the meaning set forth in Section 1.01 of the
Pledge Agreement.
"PERSON" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint-stock company, limited
liability company, trust, unincorporated organization or government or any
agency or political subdivision thereof or any other entity of whatever nature.
"PLAN" means an employee benefit plan that is subject to ERISA, a plan
or individual retirement account that is subject to Section 4975 of the Code or
any entity whose assets are considered assets of any such plan.
"PLEDGE" means the pledge under the Pledge Agreement of the Preferred
Securities, the Subordinated Notes, the Treasury Securities or the appropriate
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio, in each case constituting a part of the
Securities.
"PLEDGE AGREEMENT" means the Pledge Agreement, dated as of May 9, 2001,
among the Company, the Collateral Agent, the Securities Intermediary and the
Purchase Contract Agent, on its own behalf and as attorney-in-fact for the
Holders from time to time of the Securities.
"PLEDGED PREFERRED SECURITIES" has the meaning set forth in the Pledge
Agreement.
"PLEDGED SUBORDINATED NOTES" has the meaning set forth in the Pledge
Agreement.
"PPL CAPITAL FUNDING" means PPL Capital Funding, Inc., a Delaware
corporation and the issuer of the Subordinated Notes, and its successors.
"PREDECESSOR CERTIFICATE" means a Predecessor PEPS Units Certificate or
a Predecessor Treasury PEPS Units Certificate.
"PREDECESSOR PEPS UNITS CERTIFICATE" of any particular PEPS Units
Certificate means every previous PEPS Units Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
PEPS Units evidenced thereby; and, for the purposes of this definition, any PEPS
Units Certificate authenticated and delivered under Section 3.10 in exchange for
or in lieu of a mutilated, destroyed, lost or
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stolen PEPS Units Certificate shall be deemed to evidence the same rights and
obligations of the Company and the Holder as the mutilated, destroyed, lost or
stolen PEPS Units Certificate.
"PREDECESSOR TREASURY PEPS UNITS CERTIFICATE" of any particular Treasury
PEPS Units Certificate means every previous Treasury PEPS Units Certificate
evidencing all or a portion of the rights and obligations of the Company and the
Holder under the Treasury PEPS Units evidenced thereby; and, for the purposes of
this definition, any Treasury PEPS Units Certificate authenticated and delivered
under Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Treasury PEPS Units Certificate shall be deemed to evidence the same
rights and obligations of the Company and the Holder as the mutilated,
destroyed, lost or stolen Treasury PEPS Units Certificate.
"PREFERRED SECURITIES" means the Preferred Securities of the Trust, each
having a stated liquidation amount of $25, representing undivided beneficial
interests in the assets of the Trust.
"PREVAILING RATING" with respect to the Subordinated Notes means:
(1) AA/"Aa" if the Subordinated Notes have a credit rating of AA- or
better by Standard & Poor's Ratings Services and "Aa3" or better by Xxxxx'x
Investors Service Investors Service, Inc. or the equivalent of such ratings by
such agencies or a substitute rating agency or substitute rating agencies
selected by the Remarketing Agent (after consultation with the Company);
(2) if not under clause (1) above, then A/"a" if the Subordinated
Notes have a credit rating of A- or better by Standard & Poor's Rating Services
and "A3" or better by Xxxxx'x Investors Service or the equivalent of such
ratings by such agencies or a substitute rating agency or substitute rating
agencies selected by the Remarketing Agent (after consultation with the
Company);
(3) if not under clauses (1) or (2) above, then BBB/"Baa" if the
Subordinated Notes have a credit rating of BBB- or better by Standard & Poor's
Rating Services and "Baa3" or better by Xxxxx'x Investors Service or the
equivalent of such ratings by such agencies or a substitute rating agency or
substitute rating agencies selected by the Remarketing Agent (after consultation
with the Company); or
(4) if not under clauses (1) through (3) above, then Below
BBB/"Baa."
Notwithstanding the foregoing, (A) if (i) the credit rating of the
Subordinated Notes by Standard & Poor's Rating Services shall be on the "Credit
Watch" of Standard & Poor's Rating Services with a designation of "negative
implications" or "developing", or (ii) the credit rating of the Subordinated
Notes by Xxxxx'x Investors Service shall be on the "Corporate Credit Watch List"
of Xxxxx'x Investors Service with a designation of "downgrade" or "uncertain",
or, in each case, on any successor list of Standard & Poor's
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Rating Services or Xxxxx'x Investors Service with a comparable designation, the
prevailing ratings of the Subordinated Notes shall be deemed to be within a
range one full level lower in the above table than those actually assigned to
the Subordinated Notes by Xxxxx'x Investors Service and Standard & Poor's Rating
Services and (B) if the Subordinated Notes are rated by only one rating agency
on or before the Remarketing Date, the prevailing rating will at all times be
determined without reference to the rating of any other rating agency; provided
that if no such rating agency shall have in effect a rating of the Subordinated
Notes and the Remarketing Agent is unable to identify a substitute rating agency
or rating agencies, the prevailing rating shall be Below BBB/"Baa."
"PRIMARY TREASURY DEALER" means a primary U.S. government securities
dealer in New York City.
"PROCEEDS" has the meaning set forth in Section 1.01 of the Pledge
Agreement.
"PROPERTY TRUSTEE" means The Chase Manhattan Bank, as initial property
trustee under the Trust Agreement, or any successors thereto in such capacity
that is a financial institution unaffiliated with the Company.
"PURCHASE CONTRACT" means, with respect to any Security, the contract
forming a part of such Security and obligating the Company to (i) sell, and the
Holder of such Security to purchase, shares of Common Stock and (ii) pay the
Holder Contract Adjustment Payments, if any, on the terms and subject to the
conditions set forth in Article Five hereof.
"PURCHASE CONTRACT AGENT" means the Person named as the "Purchase
Contract Agent" in the first paragraph of this Agreement until a successor
Purchase Contract Agent shall have become such pursuant to the applicable
provisions of this Agreement, and thereafter "Purchase Contract Agent" shall
mean such Person.
"PURCHASE CONTRACT SETTLEMENT DATE" means May 18, 2004.
"PURCHASE CONTRACT SETTLEMENT FUND" has the meaning set forth in Section
5.04.
"PURCHASE PRICE" has the meaning set forth in Section 5.01.
"PURCHASED SHARES" has the meaning set forth in Section 5.05(a)(6).
"QUOTATION AGENT" means (i) Xxxxxx Xxxxxxx & Co. Incorporated and its
respective successors, provided, however, that if the foregoing shall cease to
be a Primary Treasury Dealer, the Company shall substitute therefore another
Primary Treasury Dealer or (ii) any other Primary Treasury Dealer selected by
the Company.
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"RECORD DATE" for the interest 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 fifteenth day prior to such Payment Date.
"REDEMPTION AMOUNT" means, for each Subordinated Note, the product of
(i) the principal amount of such Subordinated Note and (ii) a fraction whose
numerator is the applicable Treasury Portfolio Purchase Price and whose
denominator is the applicable Tax Event Redemption Amount.
"REDEMPTION PRICE" means the redemption price per Subordinated Note
equal to the Redemption Amount plus any accrued and unpaid interest on such
Subordinated Note to the date of redemption.
"REFERENCE DEALER" means a dealer engaged in trading of convertible
securities.
"REFERENCE PRICE" has the meaning set forth in Section 5.01.
"REMARKETING AGENT" has the meaning set forth in Section 5.02.
"REMARKETING AGREEMENT" means the Remarketing Agreement, dated as of May
9, 2001, among the Company, PPL Capital Funding, the Trust and the Remarketing
Agent.
"REMARKETING FEE" has the meaning set forth in Section 5.02.
"REORGANIZATION EVENT" has the meaning set forth in Section 5.05(b).
"RESET AGENT" means Xxxxxx Xxxxxxx & Co. Incorporated or, if Xxxxxx
Xxxxxxx & Co. Incorporated is unwilling or unable to act, another nationally
recognized investment banking firm chosen by the Company to determine the Reset
Rate.
"RESET ANNOUNCEMENT DATE" means, in the case of the Reset Rate to be
determined on the first Initial Remarketing Date on the third Business Day
immediately preceding February 18, 2004, the tenth Business Day immediately
preceding the applicable Reset Effective Date and, in the case of the Reset Rate
to be determined on the Final Remarketing Date, the tenth Business Day
immediately preceding the Purchase Contract Settlement Date, and in the case of
the Reset Rate to be determined on the date of any Additional Remarketing, the
third Business Day immediately preceding the date of any such remarketing.
"RESET EFFECTIVE DATE" means the third Business Day following a
Successful Initial Remarketing or May 18, 2004.
"RESET RATE" means the interest rate per annum (to be determined by the
Reset Agent), rounded to the nearest one-thousandth (0.001) of one percent per
annum, equal to the sum of (X) the Reset Spread and (Y) the rate of interest on
(1) in the case of the Reset
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Rate to be determined on the Initial Remarketing Date, the Benchmark Treasury in
effect on the Initial Remarketing Date or (2) in the case of the Reset Rate to
be determined on the Final Remarketing Date, (i) in the case of a Successful
Final Remarketing, the Two-Year Benchmark Treasury in effect on the Final
Remarketing Date, and (ii) in the case of a Failed Final Remarketing, the
Two-Year Benchmark Treasury in effect on the Final Remarketing Date plus the
Applicable Spread; provided, however, that the Reset Rate shall not exceed the
maximum rate permitted by applicable law and provided further that the Reset
Rate shall not be below the initial Coupon Rate.
"RESET SPREAD" means (a) in the case of the Reset Rate to be determined
on the Initial Remarketing Date, a spread amount to be determined by the Reset
Agent on the applicable Reset Announcement Date as the appropriate spread so
that the Reset Rate will be the distribution rate that the Preferred Securities
should bear, or the interest rate that the Subordinated Notes should bear, in
each case, in order for the Applicable Amount of Preferred Securities or
Subordinated Notes, as the case may be, to have an approximate aggregate market
value of 100.25% of the Treasury Portfolio Purchase Price on the Initial
Remarketing Date, (b) in the case of the Reset Rate to be determined on the
Initial Remarketing Date after a Successful Initial Remarketing, a spread amount
determined by the Reset Agent on the applicable Reset Announcement Date as the
appropriate spread so that the Reset Rate will be the distribution rate that the
Preferred Securities should bear, or the interest rate that the Subordinated
Notes should bear, in each case, in order for the Preferred Securities or
Subordinated Notes, as the case may be, to have an approximate market value of
100.25% of their liquidation amount, or principal amount, as the case may be, on
the Final Remarketing Date, and (c) in the case of the Reset Rate to be
determined on the Final Remarketing Date after a Failed Final Remarketing, the
Applicable Spread.
"RESPONSIBLE OFFICER" means, with respect to the Purchase Contract
Agent, any officer of the Purchase Contract Agent assigned by the Purchase
Contract Agent to administer this Purchase Contract Agreement.
"SECURITIES INTERMEDIARY" means The Bank of New York, as Securities
Intermediary under the Pledge Agreement until a successor Securities
Intermediary shall have become such pursuant to the applicable provisions of the
Pledge Agreement, and thereafter "Securities Intermediary" shall mean such
successor.
"SECURITY" means a PEPS Unit or a Treasury PEPS Unit, as the case may
be.
"SECURITY REGISTER" and "SECURITIES REGISTRAR" have the respective
meanings set forth in Section 3.05.
"SENIOR INDEBTEDNESS" means indebtedness of any kind of the Company
unless the instrument under which such indebtedness is incurred expressly
provides that it is on a parity in right of payment with or subordinate in right
of payment to the Contract Adjustment Payments; provided, however, that Senior
Indebtedness does not include obligations to subsidiaries, obligations to
employees or trade accounts payable.
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"SETTLEMENT RATE" has the meaning set forth in Section 5.01.
"STATED AMOUNT" means $25.
"SUBORDINATED NOTES" means the series of Subordinated Notes issued by
PPL Capital Funding under the Indenture and held by the Property Trustee.
"SUCCESSFUL FINAL REMARKETING" has the meaning set forth in Section
5.03(b).
"SUCCESSFUL INITIAL REMARKETING" has the meaning set forth in Section
5.02.
"SUPPLEMENTAL REMARKETING AGREEMENT" means the Supplemental Remarketing
Agreement between the Company and the Purchase Contract Agent in connection with
the remarketing.
"TAX EVENT REDEMPTION AMOUNT" means either (i) if the Tax Event
Redemption Date occurs prior to a Successful Initial Remarketing, or , in the
event of a Failed Initial Remarketing, prior to the Purchase Contract Settlement
Date, the aggregate liquidation amount of the Preferred Securities, or the
aggregate principal amount of the Subordinated Notes, as the case may be, which
are components of PEPS Units on the Tax Event Redemption Date or (ii) if the Tax
Event Redemption Date occurs on or after a Successful Initial Remarketing or, in
the event of a Failed Initial Remarketing, on or after the Purchase Contract
Settlement Date, the aggregate liquidation amount of the Preferred Securities or
the aggregate principal amount of Subordinated Notes, as the case may be,
outstanding on such Tax Event Redemption Date.
"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;
(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 termination or
liquidation of its affairs, shall have been entered, and, unless such
judgment, decree or order shall have been entered within 60 days prior
to the Purchase Contract Settlement Date, such judgment, decree or order
shall have continued undischarged and unstayed for a period of 60 days;
or
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(iii) at any time on or prior to the Purchase Contract
Settlement Date, the Company shall file a petition for relief under the
Bankruptcy Code, or shall consent to the filing of a bankruptcy
proceeding against it, or shall file a petition or answer or consent
seeking reorganization or liquidation under the Bankruptcy Code or any
other similar applicable Federal or State law, or shall consent to the
filing of any such petition, or shall consent to the appointment of a
receiver or liquidator or trustee or assignee in bankruptcy or
insolvency of it or of its property, or shall make an assignment for the
benefit of creditors, or shall admit in writing its inability to pay its
debts generally as they become due.
"THRESHOLD APPRECIATION PRICE" has the meaning set forth in Section
5.01.
"TIA" means the Trust Indenture Act of 1939, as amended from time to
time, or any successor legislation.
"TRADING DAY" has the meaning set forth in Section 5.01.
"TRANSFER AGENT" shall mean The Chase Manhattan Bank.
"TREASURY PEPS UNIT" means, following the substitution of Treasury
Securities for Preferred Securities or Subordinated Notes as collateral to
secure a Holder's obligations under the Purchase Contract, the collective rights
and obligations of a Holder of a Treasury PEPS Units Certificate in respect of
such Treasury Securities, subject to the Pledge thereof, and the related
Purchase Contract.
"TREASURY PEPS UNITS CERTIFICATE" means a certificate evidencing the
rights and obligations of a Holder in respect of the number of Treasury PEPS
Units specified on such certificate.
"TREASURY PORTFOLIO" means (1) in connection with the Initial
Remarketing, a portfolio of zero-coupon U.S. Treasury securities consisting of
(a) principal or interest strips of U.S. Treasury securities that mature on or
prior to May 17, 2004 in an aggregate amount equal to the Applicable Amount and
(b) with respect to the scheduled interest payment date on the Subordinated
Notes that occurs on the Purchase Contract Settlement Date, principal or
interest strips in U.S. Treasury securities that mature on or prior to such date
in an aggregate amount equal to the aggregate interest payment that would be due
on the Applicable Amount of the Subordinated Notes on such date if the
applicable Coupon Rate on the Subordinated Notes were not reset to the Reset
Rate as described in Section 4.1 and (2) in connection with a Tax Event
Redemption, (a) if the Tax Event Redemption Date occurs prior to February 18,
2004 or prior to the date of any Additional Remarketing or, in the event of a
Failed Initial Remarketing, prior to the Purchase Contract Settlement Date, a
portfolio of zero-coupon U.S. Treasury securities consisting of (i) principal or
interest strips of U.S. Treasury securities that mature on or prior to May 17,
2004 in an aggregate amount equal to the applicable Tax Event Redemption Amount
and (ii) with respect to each scheduled interest payment date on the
Subordinated Notes that occurs after the Tax Event Redemption Date and on or
before the Purchase Contract Settlement
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Date, principal or interest strips of U.S. Treasury securities that mature on or
prior to such date in an aggregate amount equal to the aggregate interest
payment that would be due on the applicable Tax Event Redemption Amount of the
Subordinated Notes on such date, and (b) if the Tax Event Redemption Date occurs
on or after February 18, 2004 or prior to the date of any Additional Remarketing
in the case of a Successful Initial Remarketing or, in the event of a Failed
Initial Remarketing, on or after the Purchase Contract Settlement Date, a
portfolio of zero-coupon U.S. Treasury securities consisting of (i) principal or
interest strips of U.S. Treasury securities that mature on or prior to May 17,
2006 in an aggregate amount equal to the applicable Tax Event Redemption Amount
and (ii) with respect to each scheduled interest payment date on the
Subordinated Notes that occurs after the Tax Event Redemption Date, principal or
interest strips of such U.S. Treasury securities that mature on or prior to such
date in an aggregate amount equal to the aggregate interest payment that would
be due on the applicable Tax Event Redemption Amount of the Subordinated Notes
on such date.
"TREASURY PORTFOLIO CASH PAYMENT" shall have the meaning set forth in
Section 7.4 of the Pledge Agreement.
"TREASURY PORTFOLIO PURCHASE PRICE" means the lowest aggregate price
quoted by the Primary Treasury Dealer to the Quotation Agent (a) in the case of
a Tax Event Redemption, on the third Business Day immediately preceding the Tax
Event Redemption Date for the purchase of the applicable Treasury Portfolio for
settlement on the Tax Event Redemption Date and (b) in the case of any Initial
Remarketing, on the Initial Remarketing Date for the purchase of the applicable
Treasury Portfolio for settlement on February 18, 2004 or from time to time
thereafter on the third Business Day immediately following the date of an
Additional Remarketing that is successful.
"TREASURY SECURITIES" means zero-coupon U.S. Treasury Securities (CUSIP
No. 000000XX0) which mature on May 17, 2004.
"TRUST" means PPL Capital Funding Trust I, a statutory business trust
formed under the laws of the State of Delaware, or any successor thereto by
merger or consolidation.
"TRUST AGREEMENT" means the Amended and Restated Trust Agreement of PPL
Capital Funding Trust I, dated as of May 9, 2001, among the Company, as sponsor,
the trustees named therein and the holders from time to time of individual
beneficial interests in the assets of the Trust.
"TWO-YEAR BENCHMARK TREASURY" means direct obligations of the United
States (which may be obligations traded on a when-issued basis only) having a
maturity comparable to the remaining term to maturity of the Subordinated Notes,
as agreed upon by the Company and the Reset Agent. The rate for the Two-Year
Benchmark Treasury will be the bid side rate displayed at 10:00 A.M., New York
City time, on the Final Remarketing Date in the Telerate system (or if the
Telerate system is (a) no longer available on the Final Remarketing Date or (b)
in the opinion of the Reset Agent (after
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consultation with the Company) no longer an appropriate system from which to
obtain such rate, such other nationally recognized quotation system as, in the
opinion of the Reset Agent (after consultation with the Company) is
appropriate). If such rate is not so displayed, the rate for the Two-Year
Benchmark Treasury shall be, as calculated by the Reset Agent, the yield to
maturity for the Two-Year Benchmark Treasury, expressed as a bond equivalent on
the basis of a year of 365 or 366 days, as applicable, and applied on a daily
basis, and computed by taking the arithmetic mean of the secondary market bid
rates, as of 10:30 A.M., New York City time, on the Final Remarketing Date of
three leading United States government securities dealers selected by the Reset
Agent (after consultation with the Company) (which may include the Reset Agent
or an Affiliate thereof).
"UNDERWRITING AGREEMENT" means, the Underwriting Agreement, dated as of
May 9, 2001, between the Company, the Trust, PPL Capital Funding and the
Underwriters identified in Schedule 1 thereto.
"VICE PRESIDENT" means any vice president, whether or not designated by
a number or a word or words added before or after the title "vice president."
SECTION 1.02. Compliance Certificates and Opinions.
Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Purchase Contract Agent to take any
action in accordance with any provision of this Agreement, the Company shall
furnish to the Purchase Contract Agent an Officers' Certificate stating that all
conditions precedent, if any, provided for in this Agreement relating to the
proposed action have been complied with and, if requested by the Purchase
Contract Agent, an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Agreement
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Agreement shall include:
(i) a statement that each individual signing such
certificate or opinion has read such covenant or condition and the
definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(iii) a statement that, in the opinion of each such
individual, he or she has made such examination or investigation as is
necessary to enable such
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individual to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 1.03. Form of Documents Delivered to Purchase Contract Agent.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which 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 1.04. Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Purchase Contract Agent and, where it is hereby expressly required, to
the Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "ACT" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and (subject to Section 7.01) conclusive in favor of
the Purchase Contract Agent and the Company, if made in the manner provided in
this Section.
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(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner which the Purchase Contract
Agent deems sufficient.
(c) The ownership of Securities shall be proved by the PEPS Units
Register or the Treasury PEPS Units Register, as the case may be.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Certificate evidencing such
Security issued upon the registration of transfer thereof or in exchange
therefor or in lieu thereof in respect of anything done, omitted or suffered to
be done by the Purchase Contract Agent or the Company in reliance thereon,
whether or not notation of such action is made upon such Certificate.
(e) The Company may set any date as a record date for the purpose of
determining the Holders of Outstanding Securities entitled to give, make or take
any request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Agreement to be given, made or taken by
Holders of Securities. If any record date is set pursuant to this paragraph, the
Holders of the Outstanding PEPS Units and the Outstanding Treasury PEPS Units,
as the case may be, on such record date, and no other Holders, shall be entitled
to take the relevant action with respect to the PEPS Units or the Treasury PEPS
Units, as the case may be, whether or not such Holders remain Holders after such
record date; provided that no such action shall be effective hereunder unless
taken prior to or on the applicable Expiration Date by Holders of the requisite
number of Outstanding Securities on such record date. Nothing contained in this
paragraph shall be construed to prevent the Company from setting a new record
date for any action for which a record date has previously been set pursuant to
this paragraph (whereupon the record date previously set shall automatically and
with no action by any Person be cancelled and be of no effect), and nothing
contained in this paragraph shall be construed to render ineffective any action
taken by Holders of the requisite number of Outstanding Securities on the date
such action is taken. Promptly after any record date is set pursuant to this
paragraph, the Company, at its own expense, shall cause notice of such record
date, the proposed action by Holders and the applicable Expiration Date to be
given to the Purchase Contract Agent in writing and to each Holder of Securities
in the manner set forth in Section 1.06.
With respect to any record date set pursuant to this Section, the
Company may designate any date as the "EXPIRATION DATE" and from time to time
may change the Expiration Date to any earlier or later day; provided that no
such change shall be effective unless notice of the proposed new Expiration Date
is given to the Purchase Contract Agent in writing, and to each Holder of
Securities in the manner set forth in Section 1.06, prior to or on the existing
Expiration Date. If an Expiration Date is not designated with respect to any
record date set pursuant to this Section, the Company shall be deemed to have
initially designated the 180th day after such record date as the Expiration Date
with respect thereto, subject to its right to change the Expiration Date as
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provided in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.
SECTION 1.05. Notices.
Any notice or communication is duly given if in writing and delivered in
Person or mailed by first-class mail (registered or certified, return receipt
requested), telecopier (with receipt confirmed) or overnight air courier
guaranteeing next day delivery, to the others' address; provided that notice
shall be deemed given to the Purchase Contract Agent only upon receipt thereof:
If to the Purchase Contract Agent:
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Institutional Trust Services
If to the Company:
PPL Corporation
Xxx Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Telecopier No.: (000) 000-0000
Attention: Treasurer
If to the Collateral Agent:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Corporate Trust Administration-
Corporate Finance Unit
If to the Property Trustee:
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Institutional Trust Services
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If to the Indenture Trustee:
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Institutional Trust Services
SECTION 1.06. Notice to Holders; Waiver.
Where this Agreement provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at its address as it appears in the applicable Security Register,
not later than the latest date, and not earlier than the earliest date,
prescribed for the giving of such notice. In any case where notice to Holders is
given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Agreement provides for notice
in any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Purchase Contract Agent, but such filing shall not be a condition precedent
to the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason
of any other cause it shall be impracticable to give such notice by mail, then
such notification as shall be made with the approval of the Purchase Contract
Agent shall constitute a sufficient notification for every purpose hereunder.
SECTION 1.07. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 1.08. Successors and Assigns.
All covenants and agreements in this Agreement by the Company and the
Purchase Contract Agent shall bind their respective successors and assigns,
whether so expressed or not.
SECTION 1.09. Separability Clause.
In case any provision in this Agreement or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof and thereof shall not in any way be affected or
impaired thereby.
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SECTION 1.10. Benefits of Agreement.
Nothing contained in this Agreement or in the Securities, express or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder and, to the extent provided hereby, the Holders, any
benefits or any legal or equitable right, remedy or claim under this Agreement.
The Holders from time to time shall be beneficiaries of this Agreement and shall
be bound by all of the terms and conditions hereof and of the Securities
evidenced by their Certificates by their acceptance of delivery of such
Certificates.
SECTION 1.11. Governing Law.
This Agreement and the Securities shall be governed by, and construed in
accordance with, the laws of the State of New York.
SECTION 1.12. Legal Holidays.
In any case where any Payment Date shall not be a Business Day, then
(notwithstanding any other provision of this Agreement or the Securities)
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 unless there shall be a default in the
payment due on such next succeeding Business Day, except that, if such next
succeeding Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day with the same force and
effect as if made on such Payment Date.
In any case where any Purchase Contract Settlement Date or Early
Settlement Date shall not be a Business Day (notwithstanding any other provision
of this Agreement or the Securities), Purchase Contracts shall not be performed
and Early Settlement shall not be effected on such date, but Purchase Contracts
shall be performed or Early Settlement effected, as applicable, on the next
succeeding Business Day with the same force and effect as if made on such
Purchase Contract Settlement Date or Early Settlement Date, as applicable,
provided that no interest shall accrue or be payable by the Company or to any
Holder for the period from and after any such Purchase Contract Settlement Date
or Early Settlement Date, as applicable, 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 Purchase Contract Settlement Date or Early Settlement Date, as
applicable.
SECTION 1.13. Counterparts.
This Agreement may be executed in any number of counterparts by the
parties hereto on separate counterparts, each of which, when so executed and
delivered, shall be
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deemed an original, but all such counterparts shall together constitute one and
the same instrument.
SECTION 1.14. Inspection of Agreement.
A copy of this Agreement shall be available at all reasonable times
during normal business hours at the Corporate Trust Office for inspection by any
Holder or Beneficial Owner.
SECTION 1.15. Appointment of Financial Institution as Agent for the
Company.
The Company may appoint a financial institution (which may be the
Collateral Agent) to act as its agent in performing its obligations and in
accepting and enforcing performance of the obligations of the Purchase Contract
Agent and the Holders, under this Agreement and the Purchase Contracts, by
giving notice of such appointment in the manner provided in Section 1.05 hereof.
Any such appointment shall not relieve the Company in any way from its
obligations hereunder.
ARTICLE 2
CERTIFICATE FORMS
SECTION 2.01. Forms of Certificates Generally.
The Certificates (including the form of Purchase Contract forming part
of each Security evidenced thereby) shall be in substantially the form set forth
in Exhibit A hereto (in the case of Certificates evidencing PEPS Units) or
Exhibit B hereto (in the case of Certificates evidencing Treasury PEPS Units),
with such letters, numbers or other marks of identification or designation and
such legends or endorsements printed, lithographed or engraved thereon as may be
required by the rules of any securities exchange on which the Securities are
listed or any depositary therefor, or as may, consistently herewith, be
determined by the officers of the Company executing such Certificates, as
evidenced by their execution of the Certificates.
The definitive Certificates shall be 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 Securities evidenced by
such Certificates, consistent with the provisions of this Agreement, as
evidenced by their execution thereof.
Every Global Certificate authenticated, executed on behalf of the
Holders and delivered hereunder shall bear a legend in substantially the
following form:
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF
THE PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE
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NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
(THE "DEPOSITARY"), OR A NOMINEE OF THE DEPOSITARY. THIS
CERTIFICATE IS EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE
NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A
TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO
THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE
REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REQUESTED IN
THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS REGISTERED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
SECTION 2.02. Form of Purchase Contract Agent's Certificate of
Authentication.
The form of the Purchase Contract Agent's certificate of authentication
of the Securities shall be in substantially the form set forth on the form of
the applicable Certificates.
ARTICLE 3
THE SECURITIES
SECTION 3.01. Amount; Form and Denominations.
The aggregate number of Securities evidenced by Certificates
authenticated, executed on behalf of the Holders and delivered hereunder is
limited to 20,000,000 (subject to increase up to a maximum of 3,000,000 to the
extent the over-allotment option granted to the Underwriters in the Underwriting
Agreement is exercised), except for Certificates authenticated, executed and
delivered upon registration of transfer of, in
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exchange for, or in lieu of, other Certificates pursuant to Section 3.04, 3.05,
3.10, 3.13, 3.14, 5.08 or 8.05.
The Certificates shall be issuable only in registered form and only in
denominations of a single PEPS Unit or Treasury PEPS Unit and any integral
multiple thereof.
SECTION 3.02. Rights and Obligations Evidenced by the Certificates.
Each PEPS Units Certificate shall evidence the number of PEPS Units
specified therein, with each such PEPS Unit representing (1) the ownership by
the Holder thereof of a beneficial interest in a Preferred Security, a
Subordinated Note or the Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, subject to the Pledge of such Preferred Security,
such Subordinated Note or the Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, as the
case may be, by such Holder pursuant to the Pledge Agreement, and (2) the rights
and obligations of the Holder thereof and the Company under one Purchase
Contract. The Purchase Contract Agent as attorney-in-fact for, and on behalf of,
the Holder of each PEPS Unit shall pledge, pursuant to the Pledge Agreement, the
Preferred Security, the Subordinated Note or the Applicable Ownership Interest
(as specified in clause (A) of the definition of such term) of the Treasury
Portfolio, as the case may be, forming a part of such PEPS Unit, to the
Collateral Agent and grant to the Collateral Agent a security interest in the
right, title and interest of such Holder in such Preferred Security, such
Subordinated Note or the Applicable Ownership Interest (as specified in clause
(A) of the definition of such term) of the Treasury Portfolio, as the case may
be, for the benefit of the Company, to secure the obligation of the Holder under
each Purchase Contract to purchase shares of Common Stock.
Upon the formation of a Treasury PEPS Unit pursuant to Section 3.13,
each Treasury PEPS Units Certificate shall evidence the number of Treasury PEPS
Units specified therein, with each such Treasury PEPS Unit representing (1) the
ownership by the Holder thereof of a 1/40 undivided beneficial interest in a
Treasury Security with a principal amount at maturity equal to $1,000, subject
to the Pledge of such Treasury Security by such Holder pursuant to the Pledge
Agreement, and (2) the rights and obligations of the Holder thereof and the
Company under one Purchase Contract.
Prior to the purchase of shares of Common Stock under each Purchase
Contract, such Purchase Contracts shall not entitle the Holder of a Security to
any of the rights of a holder of shares of Common Stock, including, without
limitation, the right to vote or receive any dividends or other payments or to
consent or to receive notice as a shareholder in respect of the meetings of
shareholders or for the election of directors of the Company or for any other
matter, or any other rights whatsoever as a shareholder of the Company.
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SECTION 3.03. Execution, Authentication, Delivery and Dating.
Subject to the provisions of Sections 3.13 and 3.14 hereof, upon the
execution and delivery of this Agreement, and at any time and from time to time
thereafter, the Company may deliver Certificates executed by the Company to the
Purchase Contract Agent for authentication, execution on behalf of the Holders
and delivery, together with its Issuer Order for authentication of such
Certificates, and the Purchase Contract Agent in accordance with such Issuer
Order shall authenticate, execute on behalf of the Holders and deliver such
Certificates.
The Certificates shall be executed on behalf of the Company by its
Chairman of the Board, its President, one of its Vice Presidents or its
Treasurer. The signature of any of these officers on the Certificates may be
manual or facsimile.
Certificates bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates.
No Purchase Contract evidenced by a Certificate shall be valid until
such Certificate has been executed on behalf of the Holder by the manual
signature of an authorized signatory of the Purchase Contract Agent, as such
Holder's attorney-in-fact. Such signature by an authorized signatory of the
Purchase Contract Agent shall be conclusive evidence that the Holder of such
Certificate has entered into the Purchase Contracts evidenced by such
Certificate.
Each Certificate shall be dated the date of its authentication.
No Certificate shall be entitled to any benefit under this Agreement or
be valid or obligatory for any purpose unless there appears on such Certificate
a certificate of authentication substantially in the form provided for herein
executed by an authorized signatory of the Purchase Contract Agent by manual
signature, and such certificate upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder.
SECTION 3.04. Temporary Certificates.
Pending the preparation of definitive Certificates, the Company shall
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall authenticate, execute on behalf of the Holders, and deliver, in lieu
of such definitive Certificates, temporary Certificates which are in
substantially the form set forth in Exhibit A or Exhibit B hereto, as the case
may be, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or engraved
thereon as may be required by the rules of any securities exchange on which the
PEPS Units or Treasury PEPS Units, as the case may be, are
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listed, or as may, consistently herewith, be determined by the officers of the
Company executing such Certificates, as evidenced by their execution of the
Certificates.
If temporary Certificates are issued, the Company will cause definitive
Certificates to be prepared without unreasonable delay. After the preparation of
definitive Certificates, the temporary Certificates shall be exchangeable for
definitive Certificates upon surrender of the temporary Certificates at the
Corporate Trust Office, at the expense of the Company and without charge to the
Holder. Upon surrender for cancellation of any one or more temporary
Certificates, the Company shall execute and deliver to the Purchase Contract
Agent, and the Purchase Contract Agent shall authenticate, execute on behalf of
the Holder, and deliver in exchange therefor, one or more definitive
Certificates of like tenor and denominations and evidencing a like number of
Securities 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 Securities, evidenced
thereby as definitive Certificates.
SECTION 3.05. Registration; Registration of Transfer and Exchange.
The Purchase Contract Agent shall keep at the Corporate Trust Office a
register (the "SECURITY REGISTER") in which, subject to such reasonable
regulations as it may prescribe, the Purchase Contract Agent shall provide for
the registration of Certificates and of transfers of Certificates (the Purchase
Contract Agent, in such capacity, the "SECURITY REGISTRAR"). The Security
Registrar shall record separately the registration and transfer of the
Certificates evidencing PEPS Units and Treasury PEPS Units.
Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office, the Company shall execute and deliver to the Purchase
Contract Agent, and the Purchase Contract Agent shall authenticate, execute on
behalf of the designated transferee or transferees, and deliver, in the name of
the designated transferee or transferees, one or more new Certificates of any
authorized denominations, like tenor, and evidencing a like number of PEPS Units
or Treasury PEPS Units, as the case may be.
At the option of the Holder, Certificates may be exchanged for other
Certificates, of any authorized denominations and evidencing a like number of
PEPS Units or Treasury PEPS Units, as the case may be, upon surrender of the
Certificates to be exchanged at the Corporate Trust Office. Whenever any
Certificates are so surrendered for exchange, the Company shall execute and
deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall
authenticate, execute on behalf of the Holder, and deliver the Certificates
which the Holder making the exchange is entitled to receive.
All Certificates issued upon any registration of transfer or exchange of
a Certificate shall evidence the ownership of the same number of PEPS Units or
Treasury PEPS Units, as the case may be, and be entitled to the same benefits
and subject to the same obligations, under this Agreement as the PEPS Units or
Treasury PEPS Units, as
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the case may be, evidenced by the Certificate surrendered upon such registration
of transfer or exchange.
Every Certificate presented or surrendered for registration of transfer
or exchange shall (if so required by the Purchase Contract Agent) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Purchase Contract Agent duly executed, by
the Holder thereof or its attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of a Certificate, but the Company and the Purchase Contract Agent may
require payment from the Holder of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Certificates, other than any exchanges pursuant to
Sections 3.06 and 8.05 not involving any transfer.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall not be obligated to authenticate, execute on behalf of the Holder
and deliver any Certificate in exchange for any other Certificate presented or
surrendered for registration of transfer or for exchange on or after the
Business Day immediately preceding the earlier of the Purchase Contract
Settlement Date or the Termination Date. In lieu of delivery of a new
Certificate, upon satisfaction of the applicable conditions specified above in
this Section and receipt of appropriate registration or transfer instructions
from such Holder, the Purchase Contract Agent shall:
(i) if the Purchase Contract Settlement Date has occurred,
upon receipt of shares of Common Stock from the Company's Transfer
Agent, deliver the shares of Common Stock issuable in respect of the
Purchase Contracts forming a part of the Securities evidenced by such
other Certificate; or
(ii) if a Termination Event shall have occurred prior to the
Purchase Contract Settlement Date, transfer the Preferred Securities,
the Subordinated Notes, the Treasury Securities, or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may
be, evidenced thereby, in each case subject to the applicable conditions
and in accordance with the applicable provisions of Article Five hereof.
SECTION 3.06. Book-entry Interests.
The Certificates, on original issuance, will be issued in the form of
one or more fully registered Global Certificates, to be delivered to the
Depositary or its custodian by, or on behalf of, the Company. The Company hereby
designates DTC as the initial Depositary. Such Global Certificates shall
initially be registered on the books and records of the Company in the name of
Cede & Co., the nominee of the Depositary, and no Beneficial Owner will receive
a definitive Certificate representing such Beneficial Owner's interest in such
Global Certificate, except as provided in Section 3.09. The
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Purchase Contract Agent shall enter into an agreement with the Depositary if so
requested by the Company. Unless and until definitive, fully registered
Certificates have been issued to Beneficial Owners pursuant to Section 3.09:
(i) the provisions of this Section 3.06 shall be in full
force and effect;
(ii) the Company and the Purchase Contract Agent shall be
entitled to deal with the Depositary 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 holder of the Global Certificates and shall have
no obligation to the Beneficial Owners;
(iii) to the extent that the provisions of this Section 3.06
conflict with any other provisions of this Agreement, the provisions of
this Section 3.06 shall control; and
(iv) the rights of the Beneficial Owners shall be exercised
only through the Depositary and shall be limited to those established by
law and agreements between such Beneficial Owners and the Depositary or
the Depositary Participants. The Depositary will make book-entry
transfers among Depositary Participants and receive and transmit
payments of Contract Adjustment Payments, if any, to such Depositary
Participants.
SECTION 3.07. Notices to Holders.
Whenever a notice or other communication to the Holders is required to
be given under this Agreement, the Company or the Company's agent shall give
such notices and communications to the Holders and, with respect to any
Securities registered in the name of the Depositary or the nominee of the
Depositary, the Company or the Company's agent shall, except as set forth
herein, have no obligations to the Beneficial Owners.
SECTION 3.08. Appointment of Successor Depositary.
If the Depositary elects to discontinue its services as securities
depositary with respect to the Securities, the Company may, in its sole
discretion, appoint a successor Depositary with respect to the Securities.
SECTION 3.09. Definitive Certificates.
If:
(i) the Depositary elects to discontinue its services as
securities depositary with respect to the Securities and a successor
Depositary is not appointed within 90 days after such discontinuance
pursuant to Section 3.08; or
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(ii) the Company elects after consultation with the Purchase
Contract Agent to terminate the book-entry system for the Securities,
then (x) definitive Certificates shall be prepared by the Company with respect
to such Securities and delivered to the Purchase Contract Agent and (y) upon
surrender of the Global Certificates representing the Securities by the
Depositary, accompanied by registration instructions, the Company shall cause
definitive Certificates to be delivered to Beneficial Owners in accordance with
the instructions of the Depositary. The Company 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. Each definitive Certificate so
delivered shall evidence Securities of the same kind and tenor as the Global
Certificate so surrendered in respect thereof.
SECTION 3.10. Mutilated, Destroyed, Lost and Stolen Certificates.
If any mutilated Certificate is surrendered to the Purchase Contract
Agent, the Company shall execute and deliver to the Purchase Contract Agent, and
the Purchase Contract Agent shall authenticate, execute on behalf of the Holder,
and deliver in exchange therefor, a new Certificate, evidencing the same number
of PEPS Units or Treasury PEPS Units, as the case may be, and bearing a
Certificate number not contemporaneously outstanding.
If there shall be delivered to the Company and the Purchase Contract
Agent (i) evidence to their satisfaction of the destruction, loss or theft of
any Certificate, and (ii) such security or indemnity as may be required by them
to hold each of them and any agent of any of them harmless, then, in the absence
of notice to the Company or the Purchase Contract Agent that such Certificate
has been acquired by a "protected" purchaser (as defined in Article 8 of the
UCC), the Company shall execute and deliver to the Purchase Contract Agent, and
the Purchase Contract Agent shall authenticate, execute on behalf of the Holder,
and deliver to the Holder, in lieu of any such destroyed, lost or stolen
Certificate, a new Certificate, evidencing the same number of PEPS Units or
Treasury PEPS Units, as the case may be, and bearing a Certificate number not
contemporaneously outstanding.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall not be obligated to authenticate, execute on behalf of the Holder,
and deliver to the Holder, a Certificate on or after the Business Day
immediately preceding the earlier of the Purchase Contract Settlement Date or
the Termination Date. In lieu of delivery of a new Certificate, upon
satisfaction of the applicable conditions specified above in this Section and
receipt of appropriate registration or transfer instructions from such Holder,
the Purchase Contract Agent shall:
(1) if the Purchase Contract Settlement Date has occurred,
upon receipt of shares of Common Stock from the Company's Transfer
Agent, deliver
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the shares of Common Stock issuable in respect of the Purchase Contracts
forming a part of the Securities evidenced by such Certificate; or
(2) if a Termination Event shall have occurred prior to the
Purchase Contract Settlement Date, transfer the Preferred Securities,
the Subordinated Notes, the Treasury Securities or the appropriate
Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, as the case may be,
evidenced thereby, in each case subject to the applicable conditions and
in accordance with the applicable provisions of Article Five hereof.
Upon the issuance of any new Certificate under this Section, the Company
and the Purchase Contract Agent may require the payment by the Holder of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Purchase Contract Agent) connected therewith.
Every new Certificate issued pursuant to this Section in lieu of any
destroyed, lost or stolen Certificate shall constitute an original additional
contractual obligation of the Company and of the Holder in respect of the
Security evidenced thereby, whether or not the destroyed, lost or stolen
Certificate (and the Securities evidenced thereby) shall be at any time
enforceable by anyone, and shall be entitled to all the benefits and be subject
to all the obligations of this Agreement equally and proportionately with any
and all other Certificates delivered hereunder.
The provisions of this Section are exclusive and shall preclude, to the
extent lawful, all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Certificates.
SECTION 3.11. Persons Deemed Owners.
Prior to due presentment of a Certificate for registration of transfer,
the Company and the Purchase Contract Agent, and any agent of the Company or the
Purchase Contract Agent, may treat the Person in whose name such Certificate is
registered as the owner of the Security evidenced thereby, for the purpose of
receiving distributions on the Preferred Securities, or interest on the Treasury
Securities, the Subordinated Notes, or on the maturing quarterly interest strips
of the Treasury Portfolio, as applicable, receiving payments of Contract
Adjustment Payments, if any, performance of the Purchase Contracts and for all
other purposes whatsoever, whether or not any distributions on the Preferred
Securities, or interest on the Treasury Securities, the Subordinated Notes, or
Treasury Portfolio, as applicable, or the Contract Adjustment Payments, if any,
payable in respect of the Purchase Contracts, constituting a part of the
Security evidenced thereby, shall be overdue and notwithstanding any notice to
the contrary, and neither the Company nor the Purchase Contract Agent, nor any
agent of the Company or the Purchase Contract Agent, shall be affected by notice
to the contrary.
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Notwithstanding the foregoing, with respect to any Global Certificate,
nothing contained herein shall prevent the Company, the Purchase Contract Agent
or any agent of the Company or the Purchase Contract Agent, from giving effect
to any written certification, proxy or other authorization furnished by the
Depositary (or its nominee), as a Holder, with respect to such Global
Certificate or impair, as between such Depositary and the related Beneficial
Owner, the operation of customary practices governing the exercise of rights of
the Depositary (or its nominee) as Holder of such Global Certificate.
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, Subordinated Notes, the appropriate Applicable Ownership Interest
(as specified in clause (A) of the definition of that term) of the Treasury
Portfolio or Treasury Securities, as the case may be, after the occurrence of a
Termination Event or pursuant to an Early Settlement, or upon the registration
of transfer or exchange of a Security, or a Collateral Substitution or the
reestablishment of PEPS Units shall, if surrendered to any Person other than the
Purchase Contract Agent, be delivered to the Purchase Contract Agent and, if not
already cancelled, shall be promptly cancelled by it. The Company may at any
time deliver to the Purchase Contract Agent for cancellation any Certificates
previously authenticated, executed and delivered hereunder which the Company may
have acquired in any manner whatsoever, and all Certificates so delivered shall,
upon Issuer Order, be promptly cancelled by the Purchase Contract Agent. No
Certificates shall be authenticated, executed on behalf of the Holder and
delivered in lieu of or in exchange for any Certificates cancelled as provided
in this Section, except as expressly permitted by this Agreement. All cancelled
Certificates held by the Purchase Contract Agent shall be disposed of in
accordance with its customary practices.
If the Company or any Affiliate of the Company shall acquire any
Certificate, such acquisition shall not operate as a cancellation of such
Certificate unless and until such Certificate is delivered to the Purchase
Contract Agent cancelled or for cancellation.
SECTION 3.13. Creation of Treasury PEPS Units by Substitution of
Treasury Securities.
Subject to the conditions set forth in this Agreement, a Holder may
separate the Preferred Securities or the Subordinated Notes, as applicable, from
the related Purchase Contracts in respect of such Holder's PEPS Units by
substituting for such Preferred Securities or the Subordinated Notes, as the
case may be, Treasury Securities in an aggregate principal amount equal to the
aggregate liquidation amount of such Preferred Securities or the aggregate
principal amount of such Subordinated Notes, as applicable (a "COLLATERAL
SUBSTITUTION"), at any time from and after the date of this Agreement and prior
to or on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date. To effect such substitution, the Holder must:
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(i) deposit with the Securities Intermediary Treasury
Securities having an aggregate amount at maturity equal to the
liquidation amount of the Preferred Securities or the aggregate
principal amount of the Subordinated Notes; and
(ii) transfer the related PEPS Units to the Purchase Contract
Agent accompanied by a notice to the Purchase Contract Agent,
substantially in the form of Exhibit C hereto, (i) stating that the
Holder has transferred the relevant amount of Treasury Securities to the
Securities Intermediary and (ii) requesting that the Purchase Contract
Agent instruct the Collateral Agent to release the Preferred Securities
or the Subordinated Notes, as the case may be, underlying such PEPS
Units, whereupon the Purchase Contract Agent shall promptly provide an
instruction to such effect to the Collateral Agent, substantially in the
form of Exhibit A to the Pledge Agreement.
Upon receipt of the Treasury Securities described in clause (i) above
and the instruction described in clause (ii) above, in accordance with the terms
of the Pledge Agreement, the Collateral Agent will cause the Securities
Intermediary to effect the release of such Preferred Securities or the
Subordinated Notes, as the case may be, from the Pledge, free and clear of the
Company's security interest therein, and the transfer of such Preferred
Securities or the Subordinated Notes, as the case may be, to the Purchase
Contract Agent on behalf of the Holder. Upon receipt thereof, the Purchase
Contract Agent shall promptly:
(i) cancel the related PEPS Units;
(ii) transfer the Preferred Securities or the Subordinated
Notes, as the case may be, to the Holder; and
(iii) authenticate, execute on behalf of such Holder and
deliver a Treasury PEPS Units Certificate executed by the Company in
accordance with Section 3.03 evidencing the same number of Purchase
Contracts as were evidenced by the cancelled PEPS Units.
Holders who elect to separate the Preferred Securities or the
Subordinated Notes, as the case may be, from the related Purchase Contracts and
to substitute Treasury Securities for such Preferred Securities or the
Subordinated Notes, as the case may be, 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 (i) only in integral multiples
of 40 PEPS Units. If a Tax Event Redemption or a Successful Initial Remarketing
has occurred, Holders may no longer convert their PEPS Units into Treasury PEPS
Units.
In the event a Holder making a Collateral Substitution pursuant to this
Section 3.13 fails to effect a book-entry transfer of the PEPS Units or fails to
deliver PEPS Units
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Certificates to the Purchase Contract Agent after depositing Treasury Securities
with the Collateral Agent, any distributions on the Preferred Securities or the
Subordinated Notes constituting a part of such PEPS Units, as the case may be,
shall be held in the name of the Purchase Contract Agent or its nominee in trust
for the benefit of such Holder, until such PEPS Units are so transferred or the
PEPS Units Certificate is so delivered, as the case may be, or, such Holder
provides evidence satisfactory to the Company and the Purchase Contract Agent
that such PEPS Units Certificate has been destroyed, lost or stolen, together
with any indemnity that may be required by the Purchase Contract Agent and the
Company.
Except as described in this Section 3.13, for so long as the Purchase
Contract underlying a PEPS Unit remains in effect, such PEPS Unit shall not be
separable into its constituent parts, and the rights and obligations of the
Holder in respect of the Preferred Securities or the Subordinated Notes or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, and the Purchase Contract comprising such PEPS Unit may be acquired, and
may be transferred and exchanged, only as a PEPS Unit.
SECTION 3.14. Reestablishment of PEPS Units.
Subject to the conditions set forth in this Agreement, a Holder of
Treasury PEPS Units may reestablish PEPS Units at any time prior to or on the
seventh Business Day immediately preceding the Purchase Contract Settlement
Date, unless a Tax Event Redemption or a Successful Initial Remarketing has
occurred, by:
(i) depositing with the Securities Intermediary Preferred
Securities or Subordinated Notes, as the case may be, having an
aggregate liquidation amount (in the case of Preferred Securities) or
aggregate principal amount (in the case of Subordinated Notes), as the
case may be, equal to the aggregate principal amount at maturity of the
Treasury Securities comprising part of the Treasury PEPS Units; and
(ii) transferring the related Treasury PEPS Units to the
Purchase Contract Agent accompanied by a notice to the Purchase Contract
Agent, substantially in the form of Exhibit C hereto, (i) stating that
the Holder has transferred the relevant amount of Preferred Securities
or Subordinated Notes, as the case may be, to the Securities
Intermediary and (ii) requesting that the Purchase Contract Agent
instruct the Collateral Agent to release the Treasury Securities
underlying such Treasury PEPS Units, whereupon the Purchase Contract
Agent shall promptly provide an instruction to such effect to the
Collateral Agent, substantially in the form of Exhibit C to the Pledge
Agreement.
Upon receipt of the Preferred Securities or the Subordinated Notes, as the case
may be, described in clause (i) above and the instruction described in clause
(ii) above, in accordance with the terms of the Pledge Agreement, the Collateral
Agent will cause the Securities Intermediary to effect the release of the
Treasury Securities having a corresponding aggregate principal amount at
maturity from the Pledge, free and clear of
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the Company's security interest therein, and the transfer to the Purchase
Contract Agent on behalf of the Holder. Upon receipt thereof, the Purchase
Contract Agent shall promptly:
(i) cancel the related Treasury PEPS Units;
(ii) transfer the Treasury Securities to the Holder; and
(iii) authenticate, execute on behalf of such Holder and
deliver a PEPS Units Certificate executed by the Company in accordance
with Section 3.03 evidencing the same number of PEPS Units as were
evidenced by the cancelled Treasury PEPS Units.
Holders who elect to reestablish PEPS Units shall be responsible for any
fees or expenses payable to the Collateral Agent for its services as Collateral
Agent in respect of the reestablishment, and the Company shall not be
responsible for any such fees or expenses.
Holders of Treasury PEPS Units may only reestablish PEPS Units in
integral multiples of 40 Treasury PEPS Units and only if a Tax Event Redemption
or a Successful Initial Remarketing has not occurred.
In the event a Holder re-establishing PEPS Units pursuant to this
Section 3.14 fails to effect a book-entry transfer of the Treasury PEPS Units or
fails to deliver a PEPS Certificate to the Purchase Contract Agent after
depositing Preferred Securities or the Subordinated Notes, as the case may be,
with the Collateral Agent, the Treasury PEPS Securities constituting a part of
such Treasury PEPS Units shall be held in the name of the Purchase Contract
Agent or its nominee in trust for the benefit of such Holder, until such
Treasury PEPS Units are so transferred or the PEPS Certificate is so delivered,
as the case may be, or, with respect to a Certificate for Treasury PEPS Units,
such Holder provides evidence satisfactory to the Company and the Purchase
Contract Agent that such Certificate has been destroyed, lost or stolen,
together with any indemnity that may be required by the Agent and the Company.
Except as provided in this Section 3.14, for so long as the Purchase
Contract underlying a Treasury PEPS Unit remains in effect, such Treasury PEPS
Unit shall not be separable into its constituent parts and the rights and
obligations of the Holder of such Treasury PEPS Unit in respect of the 1/40 of a
Treasury Security and the Purchase Contract comprising such Treasury PEPS Unit
may be acquired, and may be transferred and exchanged, only as a Treasury PEPS
Unit.
SECTION 3.15. Transfer of Collateral upon Occurrence of Termination
Event.
Upon the occurrence of a Termination Event and the transfer to the
Purchase Contract Agent of the Preferred Securities, Subordinated Notes, the
appropriate Applicable Ownership Interest of the Treasury Portfolio or the
Treasury Securities, as the
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case may be, underlying the PEPS Units and the Treasury PEPS Units, as the case
may be, pursuant to the terms of the Pledge Agreement, the Purchase Contract
Agent shall request transfer instructions with respect to such Preferred
Securities, Subordinated Notes, the appropriate Applicable Ownership Interest of
the Treasury Portfolio or Treasury Securities, as the case may be, from each
Holder by written request, substantially in the form of Exhibit D hereto, mailed
to such Holder at its address as it appears in the Security Register.
Upon book-entry transfer of the PEPS Units or the Treasury PEPS Units or
delivery of a PEPS Units Certificate or Treasury PEPS Units Certificate to the
Purchase Contract Agent with such transfer instructions, the Purchase Contract
Agent shall transfer the Preferred Securities, Subordinated Notes, the
appropriate Applicable Ownership Interest of the Treasury Portfolio or Treasury
Securities, as the case may be, underlying such PEPS Units or Treasury PEPS
Units, as the case may be, to such Holder by book-entry transfer, or other
appropriate procedures, in accordance with such instructions; provided, however,
that, to the extent that a Holder of PEPS Units or Treasury PEPS Units would
otherwise be entitled to receive less than $1,000 principal amount at maturity
of the Treasury Portfolio or the Treasury Securities, the Purchase Contract
Agent shall dispose of such securities for cash using a customary method (and
shall have no liability relating to the amount of cash so received, unless any
deficiency in the amount of such cash arose from the negligence, willful
misconduct or bad faith of the Purchase Contract Agent), and transfer the
appropriate amount of such cash to such Holder in accordance with such Holder's
instructions. In the event a Holder of PEPS Units or Treasury PEPS Units fails
to effect such transfer or delivery, the Preferred Securities, Subordinated
Notes, the appropriate Applicable Ownership Interest of the Treasury Portfolio
or Treasury Securities, as the case may be, underlying such PEPS Units or
Treasury PEPS Units, as the case may be, and any distributions thereon, shall be
held in the name of the Purchase Contract Agent or its nominee in trust for the
benefit of such Holder, until the earlier to occur of:
(i) the transfer of such PEPS Units or Treasury PEPS Units
or surrender of the PEPS Units Certificate or Treasury PEPS Units
Certificate or receipt by the Company and the Purchase Contract Agent
from such Holder of satisfactory evidence that such PEPS Units
Certificate or Treasury PEPS Units Certificate has been destroyed, lost
or stolen, together with any indemnity that may be required by the
Purchase Contract Agent and the Company; and
(ii) the expiration of the time period specified in the
abandoned property laws of the relevant State.
SECTION 3.16. No Consent to Assumption.
Each Holder of a Security, by acceptance thereof, shall be deemed
expressly to have withheld any consent to the assumption under Section 365 of
the Bankruptcy Code or otherwise, of the Purchase Contract by the Company or its
trustee, receiver, liquidator
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or a person or entity performing similar functions in the event that the Company
becomes the debtor under the Bankruptcy Code or subject to other similar state
or Federal law providing for reorganization or liquidation.
SECTION 3.17. CUSIP Numbers.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Purchase Contract Agent shall use "CUSIP"
numbers in notices of redemption as a convenience to Holders; provided that any
such notice may state that no representation is made as to the correctness of
such numbers either as printed on the Securities or as contained in any notice
of a redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers. The Company will promptly notify
the Purchase Contract Agent of any changes in the "CUSIP" numbers.
ARTICLE 4
THE PREFERRED SECURITIES, SUBORDINATED NOTES AND APPLICABLE OWNERSHIP
INTEREST OF THE TREASURY PORTFOLIO
SECTION 4.01. Distributions and Interest Payments; Rights to
Distributions and Interest Payments Preserved.
Any distribution on any Preferred Security, any interest payment on any
Subordinated Note or on the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, which is paid on any Payment Date shall,
subject to receipt thereof by the Purchase Contract Agent from the Collateral
Agent as provided by the terms of the Pledge Agreement, be paid to the Person in
whose name the PEPS Units Certificate (or one or more Predecessor PEPS Units
Certificates) of which such Preferred Security, such Subordinated Note or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, is registered at the close of business on the Record Date for such
Payment Date; provided, however, that if any such payment is received on a day
that is not a Business Day or after 11:00 a.m. (New York City time) on a
Business Day, then the Purchase Contract Agent shall use all commercially
reasonable efforts to deliver any such payment not later than 10:30 a.m. (New
York City time) on the next succeeding Business Day.
Each PEPS Units Certificate evidencing Preferred Securities,
Subordinated Notes or the appropriate Applicable Ownership Interest of the
Treasury Portfolio delivered under this Agreement upon registration of transfer
of or in exchange for or in lieu of any other PEPS Units Certificate shall carry
the right to distributions accumulated and unpaid or interest accrued and
unpaid, and to accumulate distributions or accrue interest, which were carried
by the Preferred Securities, Subordinated Notes or the appropriate Applicable
Ownership Interest of the Treasury Portfolio underlying such other PEPS Units
Certificate.
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In the case of any PEPS Units with respect to which Cash Settlement of
the underlying Purchase Contract is properly effected pursuant to Section 5.03
hereof, or with respect to which Early Settlement of the underlying Purchase
Contract is properly effected pursuant to Section 5.08 hereof, or with respect
to which a Collateral Substitution is effected, in each case on a date that is
after any Record Date and prior to or on the next succeeding Payment Date,
distributions on the Preferred Securities, Subordinated Notes or on the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, underlying such PEPS Unit otherwise payable on such Payment Date shall
be payable on such Payment Date notwithstanding such Cash Settlement or Early
Settlement or Collateral Substitution, and such distributions shall, subject to
receipt thereof by the Purchase Contract Agent, be payable to the Person in
whose name the PEPS Units Certificate (or one or more Predecessor PEPS Units
Certificates) was registered at the close of business on the Record Date. Except
as otherwise expressly provided in the immediately preceding sentence, in the
case of any PEPS Unit with respect to which Cash Settlement or Early Settlement
of the underlying Purchase Contract is properly effected, or with respect to
which a Collateral Substitution has been effected, distributions on the related
Preferred Securities, Subordinated Notes or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, that would otherwise be
payable after the Purchase Contract Settlement Date or Early Settlement Date or
Collateral Substitution shall not be payable hereunder to the Holder of such
PEPS Units; provided, however, that to the extent that such Holder continues to
hold separated Preferred Securities or Subordinated Notes that formerly
comprised a part of such Holder's PEPS Unit, such Holder shall be entitled to
receive distributions on such separated Preferred Securities or Subordinated
Notes.
The applicable Coupon Rate on the Subordinated Notes or the Preferred
Securities, as the case may be, on and after February 18, 2004 will be reset in
the case of a Successful Initial Remarketing or a Successful Final Remarketing
to the applicable Reset Rate (such Reset Rate to be in effect on and after the
applicable Reset Effective Date). In the event of a Failed Final Remarketing,
the applicable Coupon Rate on the Subordinated Notes or the Preferred
Securities, as the case may be, outstanding on and after the Purchase Contract
Settlement Date will be reset on the Purchase Contract Settlement Date to the
Reset Rate that will be equal to the Two-Year Benchmark Treasury plus the
Applicable Spread. On the applicable Reset Announcement Date the Reset Spread
and the Two-Year Benchmark Treasury or Benchmark Treasury, as applicable, to be
used to determine the Reset Rate will be announced by the Company, such
announcement to be made by a customary method, as determined by the Company. On
the Business Day immediately following the Reset Announcement Date, the holders
of the Preferred Securities or the Subordinated Notes, as the case may be, will
be notified of such Reset Spread and Two-Year Benchmark Treasury or Benchmark
Treasury, as applicable, by the Company. Such notice shall be sufficiently given
to holders of the Preferred Securities or the Subordinated Notes, as the case
may be, if published in an Authorized Newspaper.
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In the case of (i) the first Initial Remarketing on the third Business
Day prior to February 18, 2004 or the Final Remarketing, no later than 7
calendar days nor more than 15 calendar days prior to the Reset Announcement
Date, and in the case of (ii) any Additional Remarketing, as soon as practical
after the Company has been notified of an Additional Remarketing by the
Remarketing Agent, the Company will request the Depositary or its nominee by
first-class mail, postage prepaid, to notify the Beneficial Owners or
Participants holding PEPS Units or Treasury PEPS Units of such Reset
Announcement Date and, in the case of a Final Remarketing, the procedures to be
followed by Holders of PEPS Units who intend to effect a Cash Settlement on the
fourth Business Day immediately preceding the Purchase Contract Settlement Date.
SECTION 4.02. Notice and Voting.
Under the terms of the Pledge Agreement, the Purchase Contract Agent
will be entitled to exercise the voting and any other consensual rights
pertaining to the Pledged Preferred Securities or Pledged Subordinated Notes,
but only to the extent instructed in writing by the Holders as described below.
Upon receipt of notice of any meeting at which holders of Preferred Securities
or Subordinated Notes are entitled to vote or upon any solicitation of consents,
waivers or proxies of holders of Preferred Securities or Subordinated Notes, the
Purchase Contract Agent shall, as soon as practicable thereafter, mail, first
class, postage pre-paid, to the Holders of PEPS Units a notice:
(i) containing such information as is contained in the
notice or solicitation;
(ii) stating that each Holder on the record date set by the
Purchase Contract Agent therefor (which, to the extent possible, shall
be the same date as the record date for determining the holders of
Preferred Securities or Subordinated Notes, as the case may be, entitled
to vote) shall be entitled to instruct the Purchase Contract Agent as to
the exercise of the voting rights pertaining to such Preferred
Securities or Subordinated Notes underlying their PEPS Units; and
(iii) stating the manner in which such instructions may be
given.
Upon the written request of the Holders of PEPS Units on such record date
received by the Purchase Contract Agent at least six days prior to such meeting,
the Purchase Contract Agent shall endeavor insofar as practicable to vote or
cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of Preferred Securities or Subordinated Notes, as
the case may be, as to which any particular voting instructions are received. In
the absence of specific instructions from the Holder of a PEPS Unit, the
Purchase Contract Agent shall abstain from voting the Preferred Securities or
Subordinated Notes underlying such PEPS Unit. The Company hereby agrees, if
applicable, to solicit Holders of PEPS Units to timely instruct the Purchase
Contract Agent in order to enable the Purchase Contract Agent to vote such
Preferred
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Securities or Subordinated Notes and the Trust shall covenant to this effect in
the Trust Agreement.
SECTION 4.03. Distribution of Subordinated Notes; Tax Event Redemption.
Upon the dissolution and liquidation of the Trust in accordance with the
Trust Agreement prior to the Purchase Contract Settlement Date, a principal
amount at maturity of Subordinated Notes 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 Securities
Intermediary in exchange for the Pledged Preferred Securities. Thereafter, the
Subordinated Notes will be substituted for the Pledged Preferred Securities as
the Collateral, and will be held by the Securities Intermediary in the
Collateral Account in accordance with the terms of the Pledge Agreement to
secure the obligations of each Holder of a PEPS Unit to purchase the Common
Stock of the Company under the Purchase Contracts constituting a part of such
PEPS Unit. Following the dissolution and liquidation of the Trust, the Holders
and the Collateral Agent shall have such security interests, rights and
obligations with respect to the Subordinated Notes as the Holders and the
Collateral Agent had in respect of the Preferred Securities subject to the
Pledge thereof as provided in the Pledge Agreement. The Company may cause to be
made in any PEPS Unit Certificates thereafter to be issued such change in
phraseology and form (but not in substance) as may be appropriate to reflect the
dissolution and liquidation of the Trust and the substitution of Subordinated
Notes for Preferred Securities as Collateral.
Upon the occurrence of a Tax Event Redemption prior to February 18, 2004
or any Additional Remarketing, or in the event of a Failed Initial Remarketing,
prior to the Purchase Contract Settlement Date, the Redemption Price payable on
such date with respect to the Applicable Amount shall be deposited in the
Collateral Account in exchange for the Pledged Preferred Securities or the
Pledged Subordinated Notes. Thereafter, pursuant to the terms of the Pledge
Agreement, the Collateral Agent shall cause the Securities Intermediary to apply
an amount equal to the Redemption Amount of such Redemption Price to purchase on
behalf of the Holders of PEPS Units the Treasury Portfolio and promptly remit
the remaining portion of such Redemption Price to the Purchase Contract Agent
for payment to the Holders of such PEPS Units. The Applicable Ownership Interest
(as specified in clause (A) of the definition of such term) of the Treasury
Portfolio will be substituted as Collateral for the Pledged Preferred Securities
or the Pledged Subordinated Notes, as the case may be, and will be held by the
Collateral Agent in accordance with the terms of the Pledge Agreement to secure
the obligation of each Holder of a PEPS Unit to purchase the Common Stock of the
Company under the Purchase Contract constituting a part of such PEPS Unit.
Following the occurrence of a Tax Event Redemption prior to February 18, 2004,
or any Additional Remarketing prior to the Purchase Contract Settlement Date,
the Holders of PEPS Units and the Collateral
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Agent shall have such security interest rights and obligations with respect to
the Applicable Ownership Interest (as specified in clause (A) of the definition
of such term) of the Treasury Portfolio as the Holders of PEPS Units and the
Collateral Agent had in respect of the Preferred Securities or Subordinated
Notes, as the case may be, subject to the Pledge thereof as provided in the
Pledge Agreement, and any reference herein to the Preferred Securities or the
Subordinated Notes shall be deemed to be reference to such Treasury Portfolio.
The Company may cause to be made in any PEPS Unit 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 the
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio for Preferred Securities or Subordinated
Notes as Collateral.
ARTICLE 5
THE PURCHASE CONTRACTS
SECTION 5.01. Purchase of Shares of Common Stock.
Each Purchase Contract shall, unless a Cash Settlement has occurred in
accordance with Section 5.03 hereof or an Early Settlement has occurred in
accordance with Section 5.08 hereof, 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 shares
of Common Stock (subject to Section 5.09) equal to the Settlement Rate unless,
prior to or on the Purchase Contract Settlement Date, there shall have occurred
a Termination Event with respect to the Security of which such Purchase Contract
is a part. The "SETTLEMENT RATE" is equal to:
(i) if the Applicable Market Value (as defined below) is
greater than or equal to $65.03 (the "THRESHOLD APPRECIATION PRICE"),
0.3845 shares of Common Stock per Purchase Contract;
(ii) if the Applicable Market Value is less than the
Threshold Appreciation Price but greater than $53.30 (the "REFERENCE
PRICE"), the number of shares of Common Stock per Purchase Contract
having a value, based on the Applicable Market Value, equal to the
Stated Amount; and
(iii) if the Applicable Market Value is less than or equal to
the Reference Price, 0.4690 shares of Common Stock per Purchase
Contract,
in each case subject to adjustment as provided in Section 5.05 (and in each case
rounded upward or downward to the nearest 1/10,000th of a share).
The "APPLICABLE MARKET VALUE" means the average of the Closing Price per
share of Common Stock on each of the 20 consecutive Trading Days ending on the
third Trading Day immediately preceding the Purchase Contract Settlement Date.
The "CLOSING PRICE" per share of Common Stock on any date of
determination means:
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(i) the closing sale price as of the 4:15 p.m. close of
trading (or, if no closing price is reported, the last reported sale
price) per share on the NYSE on such date;
(ii) if the Common Stock is not listed for trading on the
NYSE on any such date, the closing sale price per share as reported in
the composite transactions for the principal United States securities
exchange on which the Common Stock is so listed;
(iii) if the Common Stock is not so listed on a United States
national or regional securities exchange, the closing sale price per
share as reported by The NASDAQ Stock Market, Inc.;
(iv) 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
(v) if such bid price is not available, the average of the
mid-point of the last bid and ask prices of the Common Stock on such
date from at least three nationally recognized independent investment
banking firms retained for this purpose by the Company.
A "TRADING DAY" means a day on which the Common Stock (1) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (2) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
Each Holder of a PEPS Unit or a Treasury PEPS Unit, by its acceptance
thereof:
(i) irrevocably authorizes the Purchase Contract Agent to
enter into and perform the related Purchase Contract on its behalf as
its attorney-in- fact (including the execution of Certificates on behalf
of such Holder);
(ii) agrees to be bound by the terms and provisions thereof;
(iii) covenants and agrees to perform its obligations under
such Purchase Contracts;
(iv) consents to the provisions hereof;
(v) irrevocably authorizes the Purchase Contract Agent to
enter into and perform this Agreement and the Pledge Agreement on its
behalf as its attorney-in-fact; and
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(vi) consents to, and agrees to be bound by, the Pledge of
the Preferred Securities, Subordinated Notes, the Applicable Ownership
Interest (as specified in clause (A) of the definition of such term) of
the Treasury Portfolio or the Treasury Securities pursuant to the Pledge
Agreement,
provided that upon a Termination Event, the rights of the Holder of such
Security under the Purchase Contract may be enforced without regard to any other
rights or obligations. Each Holder of a PEPS Unit or a Treasury PEPS Unit, by
its acceptance thereof, further covenants and agrees, that to the extent and in
the manner provided in Section 5.03 and the Pledge Agreement, but subject to the
terms thereof, payments in respect of the Preferred Securities or the
Subordinated Notes or the proceeds from the Treasury Securities or the
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio at maturity on the Purchase Contract
Settlement Date, as the case may be, shall be paid by the Collateral Agent to
the Company in satisfaction of such Holder's obligations under such Purchase
Contract and such Holder shall acquire no right, title or interest in such
payments.
Upon registration of transfer of a Certificate, the transferee shall be
bound (without the necessity of any other action on the part of such transferee)
by the terms of this Agreement, the Purchase Contracts underlying such
Certificate, the Trust Agreement and the Pledge Agreement and the transferor
shall be released from the obligations under this Agreement, the Purchase
Contracts underlying the Certificate so transferred and the Pledge Agreement.
The Company covenants and agrees, and each Holder of a Certificate, by its
acceptance thereof, likewise covenants and agrees, to be bound by the provisions
of this paragraph.
SECTION 5.02. Initial and Additional Remarketing.
Unless a Tax Event Redemption has occurred, the Company shall engage a
nationally recognized investment bank (the "REMARKETING AGENT") pursuant to the
Remarketing Agreement to sell the Preferred Securities or the Subordinated
Notes, as the case may be, of the PEPS Unit Holders on the third Business Day
immediately preceding February 18, 2004, and, in the event of a failed attempt
to remarket on such date, the Remarketing Agent shall use its reasonable efforts
in its discretion to remarket all of the Preferred Securities or Subordinated
Notes, as the case may be, from time to time thereafter prior to the tenth
Business Day preceding the Purchase Contract Settlement Date (each such
additional remarketing being referred to as an "ADDITIONAL REMARKETING" and, any
such Additional Remarketing and the first Remarketing on the third Business Day
preceding February 18, 2004 being referred to as an "INITIAL REMARKETING", and
each date on which an Initial Remarketing takes place being referred to as an
"INITIAL REMARKETING DATE"). In order to facilitate the remarketing, the
Purchase Contract Agent shall notify, by 11:00 a.m., New York City time, on the
Business Day immediately preceding any Initial Remarketing Date, the Remarketing
Agent and the Company, as the case
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may be, of the aggregate liquidation amount of Preferred Securities or aggregate
principal amount of Subordinated Notes, as the case may be, which constitute
part of the PEPS Units to be remarketed. Concurrently, the Collateral Agent,
pursuant to the terms of the Pledge Agreement will present for remarketing such
Preferred Securities or the Subordinated Notes, as the case may be, to the
Remarketing Agent. Upon receipt of the notice from the Purchase Contract Agent
and such Preferred Securities or the Subordinated Notes, as the case may be,
from the Collateral Agent, the Remarketing Agent will, on any Initial
Remarketing Date, use its reasonable efforts to remarket such Preferred
Securities or the Subordinated Notes, as the case may be, on such date at a
price of approximately 100.25% (but not less than 100%) of the Treasury
Portfolio Purchase Price. If the Remarketing Agent is able to remarket the
Preferred Securities or the Subordinated Notes, as the case may be, at a price
equal to or greater than 100% of the Treasury Portfolio Purchase Price (a
"SUCCESSFUL INITIAL REMARKETING"), the portion of the proceeds from such
Successful Initial Remarketing equal to the Treasury Portfolio Purchase Price
will be applied to purchase the Treasury Portfolio in accordance with Section
7.4 of the Pledge Agreement. In addition, the Remarketing Agent may deduct as a
remarketing fee ("REMARKETING FEE") an amount not exceeding 25 basis points
(0.25%) of the Treasury Portfolio Purchase Price from any amount of such
proceeds in excess of the Treasury Portfolio Purchase Price. Any proceeds in
excess of those required to pay the Treasury Portfolio Purchase Price and the
Remarketing Fee will be remitted to the Purchase Contract Agent for a prompt
payment to the Holders of the related PEPS Units to be made on a pro rata basis.
PEPS Units Holders whose Preferred Securities or Subordinated Notes, as the case
may be, are so remarketed will not otherwise be responsible for the payment of
any Remarketing Fee in connection therewith. The Treasury Portfolio will be
substituted for the Preferred Securities or Subordinated Notes, as the case may
be, of PEPS Unit Holders and will be pledged to the Collateral Agent to secure
the PEPS Unit Holders' obligation to pay the Purchase Price for the Common Stock
under the related Purchase Contracts on the Purchase Contract Settlement Date.
Following the occurrence of a Successful Initial Remarketing, the Holders of
PEPS Units and the Collateral Agent shall have such security interests, rights
and obligations with respect to the Treasury Portfolio as the Holder of PEPS
Units and the Collateral Agent had in respect of the Preferred Securities or
Subordinated Notes, as the case may be, subject to the Pledge thereof as
provided in the Pledge Agreement, and any reference herein to the Preferred
Securities or Subordinated Notes, as the case may be, shall be deemed to be a
reference to such Treasury Portfolio and any reference herein to distributions
on the Preferred Securities or interest on the Subordinated Notes, as the case
may be, shall be deemed to be a reference to corresponding distributions on the
Treasury Portfolio. The Company may cause to be made in any PEPS Units
Certificates thereafter to be issued such change in phraseology and form (but
not in substance) as may be appropriate to reflect the substitution of the
Treasury Portfolio for Preferred Securities or Subordinated Notes, as the case
may be, as collateral.
If, (i) in spite of using its reasonable efforts, the Remarketing Agent
cannot remarket the related Preferred Securities or Subordinated Notes, as the
case may be (other than to the Company), of such Holders of PEPS Units at a
price not less than 100% of the Treasury Portfolio Purchase Price, or (ii) the
remarketing has not occurred because a
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condition precedent to the remarketing has not been fulfilled, the remarketing
will be deemed to have failed (a "FAILED INITIAL REMARKETING"). The Company will
cause a notice of a Failed Initial Remarketing to be published on the Business
Day immediately succeeding any Initial Remarketing Date in the Authorized
Newspaper.
Holders of and the holders of beneficial interest in the Securities
shall be hereby deemed to agree that the obligations of the Remarketing Agent
and the Reset Agent under the Remarketing Agreement and the related supplemental
remarketing agreement are subject to satisfaction of conditions set forth in or
incorporated by reference into any such agreement.
Instead of participating in the first Initial Remarketing on the third
Business Day immediately preceding February 18, 2004, the Holders of PEPS Units
can deliver sufficient cash to the Remarketing Agent or its designated entity to
make the Treasury Portfolio Cash Payment to purchase the Treasury Portfolio on
their behalf on the fifth Business Day prior to such Remarketing as further
described in Section 7.4 of the Pledge Agreement. In addition, instead of
participating in an Additional Remarketing, the Holders of PEPS Units can
deliver sufficient cash to the Remarketing Agent or its designated entity to
make the Treasury Portfolio Cash Payment to purchase the Treasury Portfolio on
their behalf on the second Business Day prior to any Additional Remarketing as
further described in Section 7.4 of the Pledge Agreement.
To effect a collateral substitution in connection with the Treasury
Portfolio Cash Payment, a Holder shall give a notice to the Purchase Contract
Agent, substantially in the form of Exhibit I to the Pledge Agreement, stating
that the Holder has transferred the Treasury Portfolio Cash Payment to purchase
the Applicable Ownership Interest in the Treasury consideration in respect of
their PEPS Units to the Remarketing Agent, on or prior to 11:00 a.m., New York
City time, on the second Business Day immediately preceding the date of any
Additional Remarketing, and requesting that the Purchase Contract Agent instruct
the Collateral Agent to release the Preferred Securities or the Subordinated
Notes, as the case may be, underlying such PEPS Units, whereupon the Purchase
Contract Agent shall give such instruction to the Collateral Agent substantially
in the form of Exhibit J to the Pledge Agreement. If a Holder fails to deliver
the Treasury Portfolio Cash Payment on or prior to 11:00 a.m., New York City
time, on the fifth Business Day prior to February 18, 2004, on or prior to 11:00
a.m., New York City time, on the second Business Day immediately preceding the
date of any Additional Remarketing, such Holder will be deemed to have consented
to the remarketing and such Holder's Preferred Securities or the Subordinated
Notes, as the case may be, will be remarketed by the Remarketing Agent.
In the event of a Collateral substitution as described in this Section
5.02, the Preferred Securities or the Subordinated Notes, as the case may be,
shall be released by the Securities Intermediary to the Purchase Contract Agent
who shall deliver the Pledged Securities to the Holder upon satisfaction of the
conditions precedent described in this
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Section 5.02. The date of such release shall not be prior to the applicable
Reset Effective Date.
SECTION 5.02.A. Contract Adjustment Payments.
(b) 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 a Certificate (or one or more Predecessor Certificates) is registered
at the close of business on the Record Date next preceding such Payment Date in
such coin or currency of the United States as at the time of payment shall be
legal tender for payments. The Contract Adjustment Payments, if any, will be
payable at the New York Office maintained for that purpose or, at the option of
the Company, by check mailed to the address of the Person entitled thereto at
such Person's address as it appears on the Securities Register or by wire
transfer to the account designated by written notice by such Person delivered to
the Purchase Contract Agent at least 15 days prior to the applicable Payment
Date.
Upon the occurrence of a Termination Event, the Company's obligation to
pay Contract Adjustment Payments, if any, shall cease.
Each Certificate delivered under this Agreement upon registration of
transfer of or in exchange for or in lieu of (including as a result of a
Collateral Substitution or the re-establishment of a PEPS Unit) 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.
Subject to Section 5.08, in the case of any Security with respect to
which Early Settlement of the underlying Purchase Contract is effected on an
Early Settlement Date, or in respect of which Cash Settlement of the underlying
Purchase Contract is effected on the Business Day immediately preceding the
Purchase Contract Settlement Date, or with respect to which a Collateral
Substitution or a reestablishment of PEPS Units pursuant to Section 3.14 is
effected, in each case on a date that is after any Record Date and on or prior
to the next succeeding Payment Date, Contract Adjustment Payments on the
Purchase Contracts underlying such Securities otherwise payable on such Payment
Date shall be payable on such Payment Date notwithstanding such Cash Settlement,
Early Settlement, Collateral Substitution or establishment or reestablishment of
PEPS Units, 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 Cash Settlement or Early Settlement
of the underlying Purchase Contract is effected on the Business Day immediately
preceding the Purchase Contract Settlement Date or on an Early Settlement Date,
as the case may be, or with respect to which a Collateral Substitution or an
establishment or a reestablishment of PEPS Units has been
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effected, Contract Adjustment Payments, if any, that would otherwise be payable
after the Purchase Contract Settlement Date or Early Settlement Date, Collateral
Substitution or such establishment or reestablishment with respect to such
Purchase Contract shall not be payable.
(c) The Company's obligations with respect to Contract Adjustment
Payments, if any, will be subordinated and junior in right of payment to the
Company's obligations under any Senior Indebtedness.
(d) In the event (a) of any payment by, or distribution of assets of,
the Company of any kind or character, whether in cash, property or securities,
to creditors upon any dissolution, winding-up, liquidation or reorganization of
the Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, or (b) subject to the provisions of
Subsection 5.02.A(e) below, that (i) a default shall have occurred and be
continuing with respect to the payment of principal, interest or any other
monetary amounts due and payable on any Senior Indebtedness and such default
shall have continued beyond the period of grace, if any, specified in the
instrument evidencing such Senior Indebtedness (and the Purchase Contract Agent
shall have received written notice thereof from the Company or one or more
holders of Senior Indebtedness or their representative or representatives or the
trustee or trustees under any indenture pursuant to which any such Senior
Indebtedness may have been issued), or (ii) the maturity of any Senior
Indebtedness shall have been accelerated because of a default in respect of such
Senior Indebtedness (and the Purchase Contract Agent shall have received written
notice thereof from the Company or one or more holders of Senior Indebtedness or
their representative or representatives or the trustee or trustees under any
indenture pursuant to which any such Senior Indebtedness may have been issued),
then:
(i) the holders of all Senior Indebtedness shall first be
entitled to receive, in the case of (a) above, payment of all amounts
due or to become due upon all Senior Indebtedness and, in the case of
subclauses (i) and (ii) of clause (b) above, payment of all amounts due
thereon, or provision shall be made for such payment in money or money's
worth, before the Holders of any of the Securities are entitled to
receive any Contract Adjustment Payments on the Purchase Contracts
underlying the Securities;
(ii) any payment by, or distribution of assets of, the
Company of any kind or character, whether in cash, property or
securities, to which the Holders of any of the Securities would be
entitled except for the provisions of Subsections 5.02.A(b) through (n),
including any such payment or distribution which may be payable or
deliverable by reason of the payment of any other indebtedness of the
Company being subordinated to the payment of such Contract Adjustment
Payments on the Purchase Contracts underlying the Securities, shall be
paid or delivered by the Person making such payment or distribution,
whether a trustee in bankruptcy, a receiver or liquidating trustee or
otherwise, directly to the holders of such Senior Indebtedness or their
representative or representatives or to the
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trustee or trustees under any indenture under which any instruments
evidencing any of such Senior Indebtedness may have been issued, ratably
according to the aggregate amounts remaining unpaid on account of such
Senior Indebtedness held or represented by each, to the extent necessary
to make payment in full of all Senior Indebtedness remaining unpaid
after giving effect to any concurrent payment or distribution (or
provision therefor) to the holders of such Senior Indebtedness, before
any payment or distribution is made of such Contract Adjustment Payments
to the Holders of such Securities; and
(iii) in the event that, notwithstanding the foregoing, any
payment by, or distribution of assets of, the Company of any kind or
character, whether in cash, property or securities, including any such
payment or distribution which may be payable or deliverable by reason of
the payment of any other indebtedness of the Company being subordinated
to the payment of Contract Adjustment Payments on the Purchase Contracts
underlying the Securities, shall be received by the Purchase Contract
Agent or the Holders of any of the Securities when such payment or
distribution is prohibited pursuant to Subsections 5.02.A(b) through
(n), such payment or distribution shall be paid over to the holders of
such Senior Indebtedness or their representative or representatives or
to the trustee or trustees under any indenture pursuant to which any
instruments evidencing any such Senior Indebtedness may have been
issued, ratably as aforesaid, for application to the payment of all
Senior Indebtedness remaining unpaid until all such Senior Indebtedness
shall have been paid in full, after giving effect to any concurrent
payment or distribution (or provision therefor) to the holders of such
Senior Indebtedness.
(e) For purposes of Subsections 5.02.A(b) through (n), the words "cash,
property or securities" shall not be deemed to include shares of stock of the
Company as reorganized or readjusted, or securities of the Company or any other
Person provided for by a plan of reorganization or readjustment, the payment of
which is subordinated at least to the extent provided in Subsections 5.02.A(b)
through (n) with respect to such Contract Adjustment Payments on the Securities
to the payment of all Senior Indebtedness which may at the time be outstanding;
provided that (i) the indebtedness or guarantee of indebtedness, as the case may
be, that constitutes Senior Indebtedness is assumed by the Person, if any,
resulting from any such reorganization or readjustment, and (ii) the rights of
the holders of the Senior Indebtedness are not, without the consent of each such
holder adversely affected thereby, altered by such reorganization or
readjustment;
(f) Any failure by the Company to make any payment on or perform any
other obligation under Senior Indebtedness, other than any indebtedness incurred
by the Company or assumed or guaranteed, directly or indirectly, by the Company
for money borrowed (or any deferral, renewal, extension or refunding thereof) or
any indebtedness or obligation as to which the provisions of this subsection (e)
shall have been waived by the Company in the instrument or instruments by which
the Company incurred, assumed, guaranteed or otherwise created such indebtedness
or obligation, shall not be deemed a
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default or event of default if (i) the Company shall be disputing its obligation
to make such payment or perform such obligation and (ii) either (A) no final
judgment relating to such dispute shall have been issued against the Company
which is in full force and effect and is not subject to further review,
including a judgment that has become final by reason of the expiration of the
time within which a party may seek further appeal or review, and (B) in the
event of a judgment that is subject to further review or appeal has been issued,
the Company shall in good faith be prosecuting an appeal or other proceeding for
review and a stay of execution shall have been obtained pending such appeal or
review.
(g) Subject to the payment in full of all Senior Indebtedness, the
Holders of the Securities shall be subrogated (equally and ratably with the
holders of all obligations of the Company which by their express terms are
subordinated to Senior Indebtedness of the Company to the same extent as payment
of the Contract Adjustment Payments in respect of the Purchase Contracts
underlying the Securities is subordinated and which are entitled to like rights
of subrogation) to the rights of the holders of Senior Indebtedness to receive
payments or distributions of cash, property or securities of the Company
applicable to the Senior Indebtedness until all such Contract Adjustment
Payments owing on the Securities shall be paid in full, and as between the
Company, its creditors other than holders of such Senior Indebtedness and the
Holders, no such payment or distribution made to the holders of Senior
Indebtedness by virtue of Subsections 5.02.A(b) through (n) that otherwise would
have been made to the Holders shall be deemed to be a payment by the Company on
account of such Senior Indebtedness, it being understood that the provisions of
Subsections 5.02.A(b) through (n) are and are intended solely for the purpose of
defining the relative rights of the Holders, on the one hand, and the holders of
Senior Indebtedness, on the other hand.
(h) Nothing contained in Subsections 5.02.A(b) through (n) or elsewhere
in this Agreement or in the Securities is intended to or shall impair, as among
the Company, its creditors other than the holders of Senior Indebtedness and the
Holders, the obligation of the Company, which is absolute and unconditional, to
pay to the Holders such Contract Adjustment Payments on the Securities as and
when the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders and creditors of
the Company other than the holders of Senior Indebtedness, nor shall anything
herein or therein prevent the Agent or any Holder from exercising all remedies
otherwise permitted by applicable law upon default under this Agreement, subject
to the rights, if any, under these Subsections 5.02.A(b) through (n), of the
Holders of Senior Indebtedness in respect of cash, property or securities of the
Company received upon the exercise of any such remedy.
(i) Upon payment or distribution of assets of the Company referred to in
these Subsections 5.02.A(b) through (n), the Purchase Contract Agent and the
Holders shall be entitled to rely upon any order or decree made by any court of
competent jurisdiction in which any such dissolution, winding up, liquidation or
reorganization proceeding affecting the affairs of the Company is pending or
upon a certificate of the trustee in bankruptcy, receiver, assignee for the
benefit of creditors, liquidating trustee or agent or
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other person making any payment or distribution, delivered to the Purchase
Contract Agent or to the Holders, for the purpose of ascertaining the Persons
entitled to participate in such payment or distribution, the holders of the
Senior Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to these Subsections 5.02.A(b) through (n).
(j) The Purchase Contract Agent shall be entitled to rely on the
delivery to it of a written notice by a Person representing himself to be a
holder of Senior Indebtedness (or a trustee or representative on behalf of such
holder) to establish that such notice has been given by a holder of Senior
Indebtedness or a trustee or representative on behalf of any such holder or
holders. In the event that the Purchase Contract Agent determines in good faith
that further evidence is required with respect to the right of any Person as a
holder of Senior Indebtedness to participate in any payment or distribution
pursuant to Subsections 5.02.A(b) through (n), the Purchase Contract Agent may
request such Person to furnish evidence to the reasonable satisfaction of the
Purchase Contract Agent as to the amount of Senior Indebtedness held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under Subsections 5.02.A(b) through (n), and, if such evidence is not
furnished, the Purchase Contract Agent may defer payment to such Person pending
judicial determination as to the right of such Person to receive such payment.
(k) Nothing contained in Subsections 5.02.A(b) through (n) shall affect
the obligations of the Company to make, or prevent the Company from making,
payment of the Contract Adjustment Payments, except as otherwise provided in
these Subsections 5.02.A(b) through (n).
(l) Each Holder of Securities, by his acceptance thereof, authorizes and
directs the Purchase Contract Agent in his, her or its behalf to take such
action as may be necessary or appropriate to effectuate the subordination
provided in Subsections 5.02.A(b) through (n) and appoints the Purchase Contract
Agent his, her or its attorney-in-fact, as the case may be, for any and all such
purposes.
(m) The Company shall give prompt written notice to the Purchase
Contract Agent of any fact known to the Company which would prohibit the making
of any payment of moneys to or by the Purchase Contract Agent in respect of the
Securities pursuant to the provisions of this Section. Notwithstanding the
provisions of Subsections 5.02.A(b) through (e) or any other provisions of this
Agreement, the Purchase Contract Agent shall not be charged with knowledge of
the existence of any facts that would prohibit the making of any payment of
moneys to or by the Agent, or the taking of any other action by the Purchase
Contract Agent, unless and until the Purchase Contract Agent shall have received
written notice thereof mailed or delivered to the Purchase Contract Agent at its
Institutional Trust Services department from the Company, any Holder, any paying
agent or the holder or representative of any Senior Indebtedness; provided that
if at least two Business Days prior to the date upon which by the terms hereof
any such moneys may
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become payable for any purpose, the Purchase Contract Agent shall not have
received with respect to such moneys the notice provided for in this Section,
then, anything herein contained to the contrary notwithstanding, the Purchase
Contract Agent shall have full power and authority to receive such moneys and to
apply the same to the purpose for which they were received and shall not be
affected by any notice to the contrary that may be received by it within two
Business Days prior to or on or after such date.
(n) The Purchase Contract Agent in its individual capacity shall be
entitled to all the rights set forth in this Section with respect to any Senior
Indebtedness at the time held by it, to the same extent as any other holder of
Senior Indebtedness and nothing in this Agreement shall deprive the Purchase
Contract Agent of any of its rights as such holder.
(o) No right of any present or future holder of any Senior Indebtedness
to enforce the subordination herein shall at any time or in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any noncompliance by the Company with the terms, provisions and covenants
of this Agreement, regardless of any knowledge thereof which any such holder may
have or be otherwise charged with.
Nothing in this Section 5.02.A shall apply to claims of, or payments to,
the Purchase Contract Agent under or pursuant to Section 7.7.
With respect to the holders of Senior Indebtedness, (i) the duties and
obligations of the Purchase Contract Agent shall be determined solely by the
express provisions of this Agreement; (ii) the Purchase Contract Agent shall not
be liable except for the performance of such duties and obligations as are
specifically set forth in this Agreement; (iii) no implied covenants or
obligations shall be read into this Agreement against the Agent; and (iv) the
Purchase Contract Agent shall not be deemed to be a fiduciary as to such
holders.
SECTION 5.03. Payment of Purchase Price; Final Remarketing.
(a) (i) Unless a Tax Event Redemption, Successful Initial Remarketing or
Termination Event has occurred or a Holder of a PEPS Unit effects an Early
Settlement of the underlying Purchase Contract in the manner described in
Section 5.08, each Holder who intends to pay in cash to satisfy such Holder's
obligations under the Purchase Contract shall notify the Purchase Contract Agent
by use of a notice in substantially the form of Exhibit E hereto of his
intention to pay in cash ("CASH SETTLEMENT") the Purchase Price for the shares
of Common Stock to be purchased pursuant to the related Purchase Contract. Such
notice shall be given prior to 5:00 p.m. (New York City time) on the fifth
Business Day immediately preceding the Purchase Contract Settlement Date. Prior
to 11:00 a.m. (New York City time) on the next succeeding Business Day, the
Purchase Contract Agent shall notify the Collateral Agent and the Indenture
Trustee of the receipt of such notices from Holders intending to make a Cash
Settlement.
(ii) A Holder of a PEPS Unit who has so notified the Purchase
Contract Agent of his intention to effect a Cash Settlement in accordance with
paragraph 5.03(a)(i)
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above shall pay the Purchase Price to the Securities Intermediary for deposit in
the Collateral Account prior to 11:00 a.m. (New York City time) on the fourth
Business Day immediately preceding the Purchase Contract Settlement Date, in
lawful money of the United States by certified or cashiers' check or wire
transfer, in each case in immediately available funds payable to or upon the
order of the Securities Intermediary. Any cash received by the Collateral Agent
shall be invested promptly by the Securities Intermediary in Permitted
Investments and paid to the Company on the Purchase Contract Settlement Date in
settlement of the Purchase Contracts in accordance with the terms of this
Agreement and the Pledge Agreement. Any funds received by the Securities
Intermediary in respect of the investment earnings from such Permitted
Investments in excess of the Purchase Price for the shares of Common Stock to be
purchased by such Holder shall be distributed to the Purchase Contract Agent
when received for payment to the Holder.
(iii) If a Holder of a PEPS Unit fails to notify the Purchase Contract
Agent of his intention to make a Cash Settlement in accordance with paragraph
5.03(a)(i) above, or has notified the Purchase Contract Agent but fails to pay
the Purchase Price to the Securities Intermediary in accordance with paragraph
5.03(a)(ii) above, such Holder shall be deemed to have consented to the
disposition of the Pledged Preferred Securities or the Pledged Subordinated
Notes pursuant to the Remarketing as described in paragraph 5.03(b) below.
(b) Unless a Tax Event Redemption or a Successful Initial Remarketing
has occurred, the Preferred Securities or Subordinated Notes, as the case may
be, of PEPS Unit Holders who have not notified the Purchase Contract Agent of
their intention to effect a Cash Settlement as provided in paragraph (a)(i)
above or have failed to pay the Purchase Price to the Securities Intermediary in
accordance with paragraph 5.03 (a)(ii) above will be sold by the Remarketing
Agent (the "FINAL REMARKETING") on the third Business Day immediately preceding
the Purchase Contract Settlement Date (the "FINAL REMARKETING DATE"). The
Purchase Contract Agent shall notify, by 11:00 a.m., New York City time, on the
Business Day immediately preceding the Final Remarketing Date, the Remarketing
Agent, the Collateral Agent, the Indenture Trustee and the Company of the
liquidation amount of Preferred Securities or the aggregate principal amount of
Subordinated Notes, as the case may be, that are part of PEPS Units to be
remarketed. Concurrently, the Collateral Agent, pursuant to the terms of the
Pledge Agreement, will present for remarketing such Preferred Securities or
Subordinated Notes, as the case may be, to the Remarketing Agent. Upon receipt
of such notice from the Collateral Agent and such Preferred Securities or
Subordinated Notes from the Collateral Agent, the Remarketing Agent will, on the
Final Remarketing Date, use its reasonable efforts to remarket such Preferred
Securities or Subordinated Notes, as the case may be, on such date at a price of
approximately 100.25% (but not less than 100%) of the aggregate liquidation
amount of such Preferred Securities or the aggregate principal amount of
Subordinated Notes, as the case may be. If the Remarketing Agent is able to
remarket the Preferred Securities or Subordinated Notes at a price equal to or
greater than 100% of the aggregate liquidation amount of Preferred Securities or
the aggregate principal amount of
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the Subordinated Notes (a "SUCCESSFUL FINAL REMARKETING"), the Remarketing Agent
will remit the entire amount of the proceeds from such Successful Final
Remarketing to the Collateral Agent; provided, however, that the Remarketing
Agent may deduct as the Remarketing Fee an amount not exceeding 25 basis points
(0.25%) of the aggregate liquidation amount of the remarketed Preferred
Securities or the aggregate principal amount of the remarketed Subordinated
Notes from any amount of the proceeds of a Successful Final Remarketing in
excess of the aggregate liquidation amount of the remarketed Preferred
Securities or the aggregate principal amount of the remarketed Subordinated
Notes. The portion of the proceeds equal to the aggregate principal amount of
Preferred Securities or the aggregate principal amount of Subordinated Notes
will automatically be applied by the Collateral Agent, in accordance with the
Pledge Agreement, to satisfy in full such PEPS Units Holders' obligations to pay
the Purchase Price for the Common Stock under the related Purchase Contracts on
the Purchase Contract Settlement Date. Any proceeds in excess of those required
to pay the Purchase Price and the Remarketing Fee will be remitted to the
Purchase Contract Agent for payment to the Holders of the related PEPS Units.
PEPS Units Holders whose Preferred Securities or Subordinated Notes, as the case
may be, are so remarketed will not otherwise be responsible for the payment of
any Remarketing Fee in connection therewith. If, (i) in spite of using its
reasonable efforts, the Remarketing Agent cannot remarket the related Preferred
Securities or Subordinated Notes, as the case may be (other than to the
Company), of such Holders of PEPS Units at a price not less than 100% of the
aggregate liquidation amount of the Preferred Securities or the aggregate
principal amount of the Subordinated Notes, as the case may be, or (ii) the
remarketing has not occurred because a condition precedent to the remarketing
has not been fulfilled, the remarketing will be deemed to have failed (a "FAILED
FINAL REMARKETING") and in accordance with the terms of the Pledge Agreement the
Collateral Agent for the benefit of the Company will exercise its rights as a
secured party with respect to such Preferred Securities or Subordinated Notes,
as the case may be, including those actions specified in paragraph (c) below.
The Company will cause a notice of such Failed Final Remarketing to be published
on the second Business Day immediately preceding the Purchase Contract
Settlement Date in the Authorized Newspaper.
(c) With respect to Preferred Securities or Subordinated Notes, which
are subject to a Failed Final Remarketing, the Collateral Agent for the benefit
of the Company reserves all of its rights as a secured party with respect
thereto and, subject to applicable law and paragraph (h) below, may, among other
things, (i) retain the Preferred Securities or Subordinated Notes, as the case
may be, or (ii) sell the Preferred Securities or Subordinated Notes, as the case
may be, in one or more public or private sales, each in full satisfaction of the
Holders' obligations under the Purchase Contracts.
(d) Unless a Termination Event or an Early Settlement has occurred, the
Purchase Contract underlying each Treasury Unit and, if a Tax Event Redemption
or a Successful Initial Remarketing has occurred, each PEPS Unit will be settled
with the Proceeds at maturity of the Treasury Security or the Applicable
Ownership Interest (as defined in clause (A) of the definition of such term) of
the Treasury Portfolio, as applicable. Upon
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receipt of such Proceeds, the Collateral Agent will invest the Proceeds promptly
in Permitted Investments and pay the Proceeds to the Company on the Purchase
Contract Settlement Date in accordance with the terms of this Agreement and the
Pledge Agreement. Any such Proceeds received by the Collateral Agent in excess
of the Purchase Price and 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 Purchase Contract Agent when received for payment to
the Holder.
(e) Any distribution to Holders of excess funds and interest described
above, shall be payable at the New York Office maintained for that purpose or,
at the option of the Holder, by check mailed to the address of the Person
entitled thereto at such address as it appears on the Security Register or, at
the option of the Company, by wire transfer to the bank account designated by
such Holder in writing, such payments to be made to the same Persons entitled to
receive Common Stock with respect to Purchase Contracts referred to in
Subsection (d) above.
(f) (i) Unless a Holder of a Treasury PEPS Units or PEPS Units effects
an Early Settlement of the underlying Purchase Contract through the early
delivery of cash to the Purchase Contract Agent in the manner described in
Section 5.08, each Holder of a Treasury PEPS Unit who intends to pay in cash
shall notify the Purchase Contract Agent by use of a notice in substantially the
form of Exhibit E hereto of his intention to pay in cash the Purchase Price for
the shares of Common Stock to be purchased pursuant to the related Purchase
Contract. Such notice shall be given prior to 5:00 p.m. (New York City time) on
the second Business Day immediately preceding the Purchase Contract Settlement
Date. Prior to 11:00 a.m. (New York City time) on the next succeeding Business
Day, the Purchase Contract Agent shall notify the Collateral Agent of the
receipt of such notices from such Holders intending to make a Cash Settlement.
Treasury PEPS Unit holders may make Cash Settlements only in integral multiples
of 40 Treasury PEPS Units.
(ii) A Holder of a Treasury PEPS Unit who has so notified the
Purchase Contract Agent of his intention to make a Cash Settlement in accordance
with paragraph 5.03(f)(i) above shall pay the Purchase Price to the Securities
Intermediary for deposit in the Collateral Account prior to 11:00 a.m. (New York
City time) on the Business Day immediately preceding May 18, 2004, in lawful
money of the United States by certified or cashiers' check or wire transfer, in
each case in immediately available funds payable to or upon the order of the
Securities Intermediary. Any cash received by the Collateral Agent shall be
invested promptly by the Securities Intermediary in Permitted Investments and
paid to the Company on the Purchase Contract Settlement Date in settlement of
the Purchase Contract in accordance with the terms of this Agreement and the
Pledge Agreement. Any funds received by the Securities Intermediary in respect
of the investment earnings from the investment in such Permitted Investments in
excess of the Purchase Price for the shares of common stock to be purchased by
such Holder shall be distributed to the Purchase Contract Agent when received
for payment to the Holder.
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(iii) If a Holder of a Treasury PEPS Unit fails to notify the
Purchase Contract Agent of his intention to make a Cash Settlement in accordance
with paragraph 5.03(f)(i) above, or does notify the Purchase Contract Agent as
provided in paragraph 5.03(f)(i) above of his intention to pay the Purchase
Price in cash, but fails to make such payment as required by paragraph
5.03(f)(ii) above, then upon the maturity of the Pledged Treasury Securities
held by the Securities Intermediary on the Business Day immediately preceding
the Purchase Contract Settlement Date, the principal amount of the Treasury
Securities received by the Securities Intermediary shall be invested promptly in
Permitted Investments. On the Purchase Contract Settlement Date, an amount equal
to the Purchase Price shall be remitted to the Company as payment thereof
without receiving any instructions from the Holder. In the event the sum of the
proceeds from the related Pledged Treasury Securities and the investment
earnings earned from such investments is in excess of the aggregate Purchase
Price of the Purchase Contracts being settled thereby, the Collateral Agent
shall cause the Securities Intermediary to distribute such excess to the
Purchase Contract Agent for the benefit of the Holder of the related Treasury
PEPS Unit or PEPS Unit when received.
(iv) If a Tax Event Redemption or a Successful Initial
Remarketing has occurred, a Holder of a PEPS Unit may not make a Cash
Settlement.
(v) A holder of a Preferred Security or Subordinated Note
that is no longer part of a PEPS Unit may elect to have such Preferred Security
or Subordinated Note, as the case may be, remarketed pursuant to Section 5.7(c)
of the Pledge Agreement.
(g) 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, Pledged
Subordinated Notes, the appropriate Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio or the Pledged Treasury Securities, as the case may be,
underlying the relevant Security to be released from the Pledge, free
and clear of any security interest of the Company, and transferred to
the Purchase Contract Agent for delivery to the Holder thereof or its
designee as soon as practicable; and
(ii) subject to the receipt thereof, the Purchase Contract
Agent shall, by book-entry transfer or other appropriate procedures, in
accordance with written instructions provided by the Holder thereof,
transfer such Preferred Securities, Subordinated Notes, or the
appropriate Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio or such Treasury
Securities, as the case may be (or, if no such instructions are given to
the Purchase Contract Agent by the Holder, the Purchase Contract Agent
shall hold such Preferred Securities, Subordinated Notes, or the
appropriate Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio or such Treasury
Securities, as the case may be, and any
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interest payment thereon, in the name of the Purchase Contract Agent or
its nominee in trust for the benefit of such Holder until the expiration
of the time period specified in the abandoned property laws of the
relevant state).
(h) The obligations of the Holders to pay the Purchase Price are
non-recourse obligations and, except to the extent satisfied by Early Settlement
or Cash Settlement, are payable solely out of the proceeds of any Collateral
pledged to secure the obligations of the Holders and in no event will Holders be
liable for any deficiency between the proceeds of the disposition of Collateral
and the Purchase Price.
SECTION 5.03.A. Failed Final Remarketing.
If a Failed Final Remarketing occurs Holders of Preferred Securities or
Subordinated Notes, as the case may be, that are not part of a PEPS Unit will
retain possession of their Preferred Securities, and the Reset Rate will be
reset on the Purchase Contract Settlement Date as described in the definition of
Reset Rate in Section 1.01 and in Section 4.01 of this Agreement.
SECTION 5.04. Issuance of Shares of Common Stock.
Unless a Termination Event or an Early Settlement shall have occurred,
subject to Section 5.05(b), on the Purchase Contract Settlement Date upon
receipt of the aggregate Purchase Price payable on all Outstanding Securities,
the Company shall issue and deposit with the Purchase Contract Agent, for the
benefit of the Holders of the Outstanding Securities, one or more certificates
representing the shares of Common Stock registered in the name of the Purchase
Contract Agent (or its nominee) as custodian for the Holders (such certificates
for shares of Common Stock, together with any dividends or distributions for
which a record date and payment date for such dividend or distribution has
occurred after the Purchase Contract Settlement Date, being hereinafter referred
to as the "PURCHASE CONTRACT SETTLEMENT FUND") to which the Holders are entitled
hereunder.
Subject to the foregoing, upon surrender of a Certificate to the
Purchase Contract Agent on or after the Purchase Contract Settlement Date,
together with settlement instructions thereon duly completed and executed, the
Holder of such Certificate shall be entitled to receive in exchange therefor a
certificate representing that number of whole shares of Common Stock which such
Holder is entitled to receive pursuant to the provisions of this Article Five
(after taking into account all Securities then held by such Holder), together
with cash in lieu of fractional shares as provided in Section 5.09 and any
dividends or distributions with respect to such shares constituting part of the
Purchase Contract Settlement Fund, but without any interest thereon, and the
Certificate so surrendered shall be cancelled. Such shares shall be registered
in the name of the Holder or the Holder's designee as specified in the
settlement instructions provided by the Holder to the Purchase Contract Agent.
If any shares of Common Stock issued in respect of a Purchase Contract are to be
registered to a Person other than the Person in whose name the Certificate
evidencing such Purchase Contract is registered, no such
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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 5.05. Adjustment of Settlement Rate.
(a) Adjustments for Dividends, Distributions, Stock Splits, Etc.
(1) In case the Company shall pay or make a dividend or other
distribution on Common Stock in Common Stock, the Settlement Rate in effect at
the opening of business on the day following the date fixed for the
determination of shareholders entitled to receive such dividend or other
distribution shall be increased by dividing such Settlement Rate by a fraction
of which:
(i) the numerator shall be the number of shares of Common
Stock outstanding at the close of business on the date fixed for such
determination; and
(ii) the denominator shall be the sum of such number of
shares and the total number of shares constituting such dividend or
other distribution,
such increase to become effective immediately after the opening of business on
the day following the date fixed for such determination. For the purposes of
this paragraph (1), the number of shares of Common Stock at any time outstanding
shall not include shares held in the treasury of the Company but shall include
any shares issuable in respect of any scrip certificates issued in lieu of
fractions of shares of Common Stock. The Company shall not pay any dividend or
make any distribution on shares of Common Stock held in the treasury of the
Company.
(2) In case the Company shall issue rights, warrants or options to all
holders of its Common Stock (not being available on an equivalent basis to
Holders of the Securities upon settlement of the Purchase Contracts underlying
such Securities) entitling them, for a period expiring within 45 days after the
record date for the determination of shareholders entitled to receive such
rights, warrants or options, to subscribe for or purchase shares of Common Stock
at a price per share less than the Current Market Price per share of Common
Stock on the date fixed for the determination of shareholders entitled to
receive such rights, warrants or options the Settlement Rate in effect at the
opening of business on the day following the date fixed for such determination
shall be increased by dividing such Settlement Rate by a fraction of which:
(i) the numerator shall be the number of shares of Common
Stock outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock which the
aggregate of the offering price of the total number of shares of Common
Stock so offered for subscription or purchase would purchase at such
Current Market Price; and
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(ii) the denominator shall be the number of shares of Common
Stock outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock so offered for
subscription or purchase,
such increase to become effective immediately after the opening of business on
the day following the date fixed for such determination. For the purposes of
this paragraph (2), the number of shares of Common Stock at any time outstanding
shall not include shares held in the treasury of the Company but shall include
any shares issuable in respect of any scrip certificates issued in lieu of
fractions of shares of Common Stock. The Company agrees that it shall not issue
any such rights, warrants or options in respect of shares of Common Stock held
in the treasury of the Company.
(3) In case outstanding shares of Common Stock shall be subdivided or
split into a greater number of shares of Common Stock, the Settlement Rate in
effect at the opening of business on the day following the day upon which such
subdivision or split becomes effective shall be proportionately increased, and,
conversely, in case outstanding shares of Common Stock shall each be combined
into a smaller number of shares of Common Stock, the Settlement Rate in effect
at the opening of business on the day following the day upon which such
combination becomes effective shall be proportionately reduced, such increase or
reduction, as the case may be, to become effective immediately after the opening
of business on the day following the day upon which such subdivision, split or
combination becomes effective.
(4) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock evidences of its indebtedness or assets
(including securities, but excluding any rights, warrants or options referred to
in paragraph (2) of this Section 5.05(a), any dividend or distribution paid
exclusively in cash and any dividend or distribution referred to in paragraph
(1) of this Section 5.05(a)), the Settlement Rate shall be adjusted so that the
same shall equal the rate determined by dividing the Settlement Rate in effect
immediately prior to the close of business on the date fixed for the
determination of shareholders entitled to receive such distribution by a
fraction of which:
(i) the numerator shall be the Current Market Price per
share of Common Stock on the date fixed for such determination less the
then fair market value (as reasonably determined by the Board of
Directors, whose determination shall be conclusive and the basis for
which shall be described in a Board Resolution) of the portion of the
assets or evidences of indebtedness so distributed applicable to one
share of Common Stock; and
(ii) the denominator shall be such Current Market Price per
share of Common Stock,
such adjustment to become effective immediately prior to the opening of business
on the day following the date fixed for the determination of shareholders
entitled to receive such distribution. In any case in which this paragraph (4)
is applicable, paragraph (2) of this Section 5.05(a) shall not be applicable. In
the event that such dividend or distribution is
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not so paid or made, the Settlement Rate shall again be adjusted to be the
Settlement Rate which would then be in effect if such dividend or distribution
had not been declared.
(5) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Common Stock cash (excluding:
(i) any quarterly cash dividend on Common Stock to the
extent that the aggregate cash dividend per share of Common Stock in any
fiscal quarter does not exceed $.265 per share (the "DIVIDEND
THRESHOLD"), and
(ii) any dividend or distribution in connection with the
liquidation, dissolution or termination of the Company, whether
voluntary or involuntary),
then, in such case, 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 such record date by a fraction of
which:
(iii) the numerator shall be the Current Market Price of
Common Stock on the record date less the amount of cash so distributed
(and not excluded as provided above) applicable to one share of Common
Stock; and
(iv) the denominator shall be the Current Market Price of
Common Stock,
such increase to be effective immediately prior to the opening of business on
the day following the record date; provided, however, that in the event the
portion of cash so distributed applicable to one share of Common Stock is equal
to or greater than the Current Market Price per share of Common Stock on the
record date, in lieu of the foregoing adjustment, adequate provision shall be
made so that each holder of a Security shall have the right to receive upon
settlement of the Securities the amount of cash such Holder would have received
had such Holder settled each Security on the record date. In the event that such
dividend or distribution is not so paid or made, the Settlement Rate shall again
be adjusted to be the Settlement Rate which would then be in effect if such
dividend or distribution had not been declared. If any adjustment is required to
be made as set forth in this Section 5.05(a)(5) as a result of a distribution
that is a quarterly dividend, such adjustment shall be based upon the amount by
which such distribution exceeds the amount of the Dividend Threshold. If an
adjustment is required to be made as set forth in this Section 5.05(a)(5) above
as a result of a distribution that is not a quarterly dividend, such adjustment
shall be based upon the full amount of the distribution.
(6) In case a tender or exchange offer made by the Company or any
subsidiary of the Company for all or any portion of Common Stock shall expire
and such tender or exchange offer (as amended upon the expiration thereof) shall
require the payment to shareholders (based on the acceptance (up to any maximum
specified in the terms of the tender or exchange offer) of Purchased Shares as
herein defined) of an aggregate
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consideration having a fair market value (as reasonably determined by the Board
of Directors, whose determination shall be conclusive and the basis for which
shall be described in a Board Resolution) that combined together with the
aggregate of the cash plus the fair market value (as reasonably determined by
the Board of Directors, whose determination shall be conclusive and the basis
for which shall be described in a Board Resolution), as of the expiration of
such tender or exchange offer, of consideration payable in respect of any other
tender or exchange offer, by the Company or any subsidiary of the Company for
all or any portion of Common Stock expiring within the 12 months preceding the
expiration of such tender or exchange offer and in respect of which no
adjustment pursuant to this paragraph (6) has been made, and (II) the aggregate
amount of any distributions to all holders of Common Stock made exclusively in
cash within the 12 months preceding the expiration of such tender or exchange
offer and in respect of which no adjustment pursuant to paragraph (6) has been
made, exceeds 15% of the product of the Current Market Price per share of Common
Stock as of the last time (the "EXPIRATION TIME") tenders could have been made
pursuant to such tender or exchange offer (as it may be amended) times the
number of shares of Common Stock outstanding (including any tendered shares) on
the Expiration Time, then, and in each such case, immediately prior to the
opening of business on the day after the date of the Expiration Time, the
Settlement Rate shall be adjusted so that the same shall equal the rate
determined by dividing the Settlement Rate immediately prior to the close of
business on the date of the Expiration Time by a fraction:
(i) the numerator of which shall be equal to (A) the product
of (I) the Current Market Price per share of Common Stock on the date of
the Expiration Time and (II) the number of shares of Common Stock
outstanding (including any tendered shares) on the Expiration Time less
(B) the amount of cash plus the fair market value (determined as
aforesaid) of the aggregate consideration payable to shareholders based
on the transactions described in clauses (I) and (II) above (assuming in
the case of clause (I) the acceptance, up to any maximum specified in
the terms of the tender or exchange offer, of Purchased Shares); and
(ii) the denominator of which shall be equal to the product
of (A) the Current Market Price per share of Common Stock as of the
Expiration Time and (B) the number of shares of Common Stock outstanding
(including any tendered shares) as of the Expiration Time less the
number of all shares validly tendered and not withdrawn as of the
Expiration Time (the shares deemed so accepted, up to any such maximum,
being referred to as the "PURCHASED SHARES").
(7) The reclassification of Common Stock into securities including
securities other than Common Stock (other than any reclassification upon a
Reorganization Event to which Section 5.05(b) applies) shall be deemed to
involve:
(i) a distribution of such securities other than Common
Stock to all holders of Common Stock (and the effective date of such
reclassification shall be deemed to be "the date fixed for the
determination of shareholders entitled to
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receive such distribution" and the "date fixed for such determination"
within the meaning of paragraph (4) of this Section); and
(ii) a subdivision, split or combination, as the case may be,
of the number of shares of Common Stock outstanding immediately prior to
such reclassification into the number of shares of Common Stock
outstanding immediately thereafter (and the effective date of such
reclassification shall be deemed to be "the day upon which such
subdivision or split becomes effective" or "the day upon which such
combination becomes effective", as the case may be, and "the day upon
which such subdivision, split or combination becomes effective" within
the meaning of paragraph (3) of this Section).
(8) The "CURRENT MARKET PRICE" per share of Common Stock on any date
of determination means the average of the daily Closing Prices for the five
consecutive Trading Days selected by the Company commencing not more than 30
Trading Days before, and ending not later than, the earlier of such date of
determination and the day before the "ex date" with respect to the issuance or
distribution requiring such computation. For purposes of this paragraph, the
term "ex date," when used with respect to any issuance or distribution, shall
mean the first date on which Common Stock trades on such exchange or in such
market without the right to receive such issuance or distribution.
(9) All adjustments to the Settlement Rate shall be calculated to
the nearest 1/10,000th of a share of Common Stock (or if there is not a nearest
1/10,000th of a share, to the next lower 1/10,000th of a share). No adjustment
in the Settlement Rate shall be required unless such adjustment would require an
increase or decrease of at least one percent thereof; provided, however, that
any adjustments which by reason of this subparagraph are not required to be made
shall be carried forward and taken into account in any subsequent adjustment. If
an adjustment is made to the Settlement Rate pursuant to paragraph (1), (2),
(3), (4), (5), (6), (7) or (10) of this Section 5.05(a), an adjustment shall
also be made to the Applicable Market Value solely to determine which of clauses
(i), (ii) or (iii) of the definition of Settlement Rate in Section 5.01 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 5.05(a) and
the denominator shall be the Settlement Rate immediately prior to such
adjustment; provided, however, that if such adjustment to the Settlement Rate is
required to be made pursuant to the occurrence of any of the events contemplated
by paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of this Section 5.05(a)
during the period taken into consideration for determining the Applicable Market
Value, appropriate and customary adjustments shall be made to the Settlement
Rate.
(10) The Company may, but shall not be required to, 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
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Common Stock resulting from any dividend or distribution of stock or issuance of
rights or warrants to purchase or subscribe for stock or from any event treated
as such for income tax purposes or for any other reason.
(b) Adjustment for Consolidation, Merger or Other Reorganization Event.
(1) In the event of:
(i) any consolidation or merger of the Company with or into
another Person (other than a merger or consolidation in which the
Company is the continuing corporation and in which the shares of Common
Stock outstanding immediately prior to the merger or consolidation are
not exchanged for cash, securities or other property of the Company or
another Person);
(ii) any sale, transfer, lease or conveyance to another
Person of the property of the Company as an entirety or substantially as
an entirety;
(iii) any statutory share exchange of the Company with another
Person (other than in connection with a merger or acquisition);
(iv) any liquidation, dissolution or termination of the
Company other than as a result of or after the occurrence of a
Termination Event (any such event, a "REORGANIZATION EVENT"),
the Settlement Rate will be adjusted to provide that each Holder of Securities
will receive on the Purchase Contract Settlement Date with respect to each
Purchase Contract forming a part thereof, the kind and amount of securities,
cash and other property receivable upon such Reorganization Event (without any
interest thereon, and without any right to dividends or distribution thereon
which have a record date that is prior to the Purchase Contract Settlement Date)
by a Holder of the number of shares of Common Stock issuable on account of each
Purchase Contract if the Purchase Contract Settlement Date had occurred
immediately prior to such Reorganization Event, assuming such Holder of Common
Stock is not a Person with which the Company consolidated or into which the
Company merged or which merged into the Company or to which such sale or
transfer was made, as the case may be (any such Person, a "CONSTITUENT PERSON"),
or an Affiliate of a Constituent Person to the extent such Reorganization Event
provides for different treatment of Common Stock held by Affiliates of the
Company and non-affiliates and such Holder failed to exercise his rights of
election, if any, as to the kind or amount of securities, cash and other
property receivable upon such Reorganization Event (provided that if the kind or
amount of securities, cash and other property receivable upon such
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
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non-electing share shall be deemed to be the kind and amount so receivable per
share by a plurality of the non-electing shares).
In the event of such a Reorganization Event, the Person formed by such
consolidation, merger or exchange or the Person which acquires the assets of the
Company or, in the event of a liquidation, dissolution or termination of the
Company, the Company or a liquidating trust created in connection therewith,
shall execute and deliver to the Purchase Contract Agent an agreement
supplemental hereto providing that each Holder of an Outstanding Security shall
have the rights provided by this Section 5.05(b). Such supplemental agreement
shall provide for adjustments which, for events subsequent to the effective date
of such supplemental agreement, shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Section. The above
provisions of this Section shall similarly apply to successive Reorganization
Events.
(2) In the event of a consolidation or merger of the Company with or
into another Person, any merger of another Person into the Company (other than a
merger that does not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of Common Stock) in which 30% or more of the
total consideration paid to the Company's shareholders consists of cash or cash
equivalents, then a Holder of a Security may settle his Purchase Contract for
cash as described in Section 5.03(a)(i) or 5.03(f)(i) hereof, as applicable,
during the one week period beginning on the twenty-third Trading Day following
the closing date of such merger (the "EARLY SETTLEMENT WEEK"), at the applicable
Settlement Rate. For the purposes of this Section, the twenty-third Trading Day
after the closing of the merger or consolidation shall be deemed to be the
Purchase Contract Settlement Date for the purpose of determining the Applicable
Market Value and the deadline for submitting the notice to settle early and the
related cash payment shall be 5:00 p.m. (New York City time) of the last
Business Day of the Early Settlement Week.
(c) All calculations and determinations pursuant to this Section 5.05
shall be made by the Company or its agent and the Purchase Contract Agent shall
have no responsibility with respect thereto.
SECTION 5.06. 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 5.05 and prepare and transmit to the Purchase
Contract Agent an Officers' Certificate setting forth the Settlement
Rate, the method of calculation thereof in reasonable detail, and the
facts requiring such adjustment and upon which such adjustment is based;
and
(ii) within 10 Business Days following the occurrence of an
event that requires an adjustment to the Settlement Rate pursuant to
Section 5.05 (or if the
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Company is not aware of such occurrence, as soon as practicable after
becoming so aware), provide a written notice to the Holders of the
Securities of the occurrence of such event and a statement in reasonable
detail setting forth the method by which the adjustment to the
Settlement Rate was determined and setting forth the adjusted Settlement
Rate.
(b) The Purchase Contract Agent shall not at any time be under any duty
or responsibility to any Holder of Securities to determine whether any facts
exist which may require any adjustment of the Settlement Rate, or with respect
to the nature or extent or calculation of any such adjustment when made, or with
respect to the method employed in making the same. The Purchase Contract Agent
shall not be accountable with respect to the validity or value (or the kind or
amount) of any shares of Common Stock, or of any securities or property, which
may at the time be issued or delivered with respect to any Purchase Contract;
and the Purchase Contract Agent makes no representation with respect thereto.
The Purchase Contract Agent shall not be responsible for any failure of the
Company to issue, transfer 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 5.07. Termination Event; Notice.
The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay Contract Adjustment
Payments, if any, if the Company shall have such obligation, and the rights and
obligations of Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Purchase Contract Agent or the Company, if, prior to or on the
Purchase Contract Settlement Date, a Termination Event shall have occurred.
Upon and after the occurrence of a Termination Event, the Securities
shall thereafter represent the right to receive the Preferred Securities, the
Subordinated Notes, the Treasury Securities or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be, forming part
of such Securities, in accordance with the provisions of Section 5.02 and 5.03
of the Pledge Agreement. Upon the occurrence of a Termination Event, the Company
shall promptly but in no event later than two Business Days thereafter give
written notice to the Purchase Contract Agent, the Collateral Agent and the
Holders, at their addresses as they appear in the Security Register.
SECTION 5.08. Early Settlement.
(a) Subject to and upon compliance with the provisions of this Section
5.08, at the option of the Holder thereof, Purchase Contracts underlying
Securities may be settled early ("EARLY SETTLEMENT") in the case of PEPS Units
(unless a Tax Event Redemption or a Successful Initial Remarketing has occurred)
on or prior to 5:00 p.m. (New York City time) on the fifth Business Day
immediately preceding the Purchase Contract Settlement
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Date, and in the case of Treasury PEPS Units on or prior to the second Business
Day immediately preceding the Purchase Contract Settlement Date, in each case,
as provided herein; provided however, that if a Tax Event Redemption or a
Successful Initial Remarketing has occurred and the Treasury Portfolio has
become a component of the PEPS Units, Purchase Contracts underlying such PEPS
Units may not be settled early. Holders of Treasury PEPS Units may only settle
the related Purchase Contracts in integral multiples of 40 Purchase Contracts.
In order to exercise the right to effect Early Settlement with respect to any
Purchase Contracts, the Holder of the Certificate evidencing Securities shall
deliver to the Purchase Contract Agent at the Corporate Trust Office an Election
to Settle Early form (on the reverse side of the Certificate) and any other
documents requested by the Purchase Contract Agent and accompanied by payment
(payable to the Company in immediately available funds) 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 on
such Payment Date with respect to such Purchase Contracts.
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 dividends
on the Common Stock issued upon such Early Settlement. If the foregoing
requirements are first satisfied with respect to Purchase Contracts underlying
any Securities prior to or at 5:00 p.m. (New York City time) on a Business Day,
such day shall be the "EARLY SETTLEMENT DATE" with respect to such Securities
and if such requirements are first satisfied after 5:00 p.m. (New York City
time) on a Business Day or on a day that is not a Business Day, the "EARLY
SETTLEMENT DATE" with respect to such Securities shall be the next succeeding
Business Day.
(b) Upon Early Settlement of Purchase Contracts by a Holder of the
related Securities, the Company shall issue, and the Holder shall be entitled to
receive 0.3845 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 future Contract
Adjustment Payments, if any, except to the extent that the Early Settlement Date
is after the close of business on a Record Date and prior to the opening of
business on the corresponding Payment Date. The Early Settlement Rate shall be
adjusted in the same manner and at the same time as the Settlement Rate is
adjusted.
(i) No later than the third Business Day after the
applicable Early Settlement Date, the Company shall cause:
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(ii) Upon receipt of the shares of Common Stock from the
Company's Transfer Agent, the shares of Common Stock issuable upon Early
Settlement of Purchase Contracts to be issued and delivered, together
with payment in lieu of any fraction of a share, as provided in Section
5.09; and
(iii) the related Preferred Securities or Subordinated Notes,
in the case of PEPS Units, or the related Treasury Securities of the
Treasury Portfolio, in the case of Treasury PEPS Units, to be released
from the Pledge by the Collateral Agent and transferred, in each case,
to the Purchase Contract Agent for delivery to the Holder thereof or its
designee.
(c) Upon Early Settlement of any Purchase Contracts, and subject to
receipt of shares of Common Stock from the Company and the Preferred Securities
or Subordinated Notes of the Treasury Portfolio, or Treasury Securities, as the
case may be, from the Securities Intermediary, as applicable, the Purchase
Contract Agent shall, in accordance with the instructions provided by the Holder
thereof on the Election to Settle Early form (on the reverse of the Certificate
evidencing the related Securities):
(i) transfer to the Holder the Preferred Securities or
Subordinated Notes, 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 5.09.
(d) In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Securities evidenced by a
Certificate, upon such Early Settlement the Company shall execute and the
Purchase Contract Agent shall authenticate, countersign and deliver to the
Holder thereof, at the expense of the Company, a Certificate evidencing the
Securities as to which Early Settlement was not effected.
(e) A Holder of a Security who effects Early Settlement may elect to
have the Preferred Securities or Subordinated Notes, as the case may be, no
longer a part of a PEPS Unit, or Treasury PEPS Unit, as the case may be,
remarketed pursuant to Section 5.7(c) of the Pledge Agreement.
SECTION 5.09. No Fractional Shares.
No fractional shares or scrip representing fractional shares of Common
Stock shall be issued or delivered upon settlement on the Purchase Contract
Settlement Date or upon Early Settlement of any Purchase Contracts. If
Certificates evidencing more than one Purchase Contract shall be surrendered for
settlement at one time by the same Holder, the number of full shares of Common
Stock which shall be delivered upon settlement shall be computed on the basis of
the aggregate number of Purchase Contracts
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evidenced by the Certificates so surrendered. Instead of any fractional share of
Common Stock which would otherwise be deliverable upon settlement of any
Purchase Contracts on the Purchase Contract Settlement Date or upon Early
Settlement, the Company, through the Purchase Contract Agent, shall make a cash
payment in respect of such fractional interest in an amount equal to the value
of such fractional shares times the Applicable Market Value. The Company shall
provide the Purchase Contract Agent from time to time with sufficient funds to
permit the Purchase Contract Agent to make all cash payments required by this
Section 5.09 in a timely manner.
SECTION 5.10. Charges and Taxes.
The Company will pay all stock transfer and similar taxes attributable
to the initial issuance and delivery of the shares of Common Stock pursuant to
the Purchase Contracts; provided, however, that the Company shall not be
required to pay any such tax or taxes which may be payable in respect of any
exchange of or substitution for a Certificate evidencing a Security or any
issuance of a share of Common Stock in a name other than that of the registered
Holder of a Certificate surrendered in respect of the Securities evidenced
thereby, other than in the name of the Purchase Contract Agent, as custodian for
such Holder, and the Company shall not be required to issue or deliver such
share certificates or Certificates unless or until the Person or Persons
requesting the transfer or issuance thereof shall have paid to the Company the
amount of such tax or shall have established to the satisfaction of the Company
that such tax has been paid.
ARTICLE 6
REMEDIES
SECTION 6.01. Unconditional Right of Holders to Receive Contract
Adjustment Payments and to Purchase Shares of Common Stock.
Each Holder of a Security shall have the right, which is absolute and
unconditional (i) to receive payment of each installment of the Contract
Adjustment Payments, if any, with respect to the Purchase Contract constituting
a part of such Security on the respective Payment Date for such Security, and
(ii) to purchase shares of Common Stock pursuant to such Purchase Contract and,
in each such case, to institute suit for the enforcement of such payment and the
right to purchase shares of Common Stock, and such rights shall not be impaired
without the consent of such Holder.
SECTION 6.02. Restoration of Rights and Remedies.
If any Holder has instituted any proceeding to enforce any right or
remedy under this Agreement and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company and such Holder shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies of such Holder
shall continue as though no such proceeding had been instituted.
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SECTION 6.03. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Certificates in the last paragraph of
Section 3.10, no right or remedy herein conferred upon or reserved to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 6.04. Delay or Omission Not Waiver.
No delay or omission of any Holder to exercise any right or remedy upon
a default shall impair any such right or remedy or constitute a waiver of any
such right. Every right and remedy given by this Article or by law to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by such Holders.
SECTION 6.05. Undertaking for Costs.
All parties to this Agreement agree, and each Holder of a Security, by
its acceptance of such Security shall be deemed to have agreed, that any court
may in its discretion require, in any suit for the enforcement of any right or
remedy under this Agreement, or in any suit against the Purchase Contract Agent
for any action taken, suffered or omitted by it as Purchase Contract Agent, the
filing by any party litigant in such suit of an undertaking to pay the costs of
such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees and costs against any party litigant in
such suit, having due regard to the merits and good faith of the claims or
defenses made by such party litigant; provided that the provisions of this
Section shall not apply to any suit instituted by the Purchase Contract Agent,
to any suit instituted by any Holder, or group of Holders, holding in the
aggregate more than 10% of the Outstanding Securities, or to any suit instituted
by any Holder for the enforcement of distributions on any Preferred Securities
or interest on any Subordinated Notes 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 6.06. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Agreement; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the
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execution of any power herein granted to the Purchase Contract Agent or the
Holders, but will suffer and permit the execution of every such power as though
no such law had been enacted.
ARTICLE 7
THE PURCHASE CONTRACT AGENT
SECTION 7.01. Certain Duties and Responsibilities.
(a) The Purchase Contract Agent:
(i) undertakes to perform, with respect to the Securities,
such duties and only such duties as are specifically set forth in this
Agreement and the Pledge Agreement, and no implied covenants or
obligations shall be read into this Agreement or the Pledge Agreement
against the Purchase Contract Agent; and
(ii) in the absence of bad faith or gross negligence on its
part, may, with respect to the Securities, conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Purchase
Contract Agent and conforming to the requirements of this Agreement or
the Pledge Agreement, as applicable, but in the case of any certificates
or opinions which by any provision hereof are specifically required to
be furnished to the Purchase Contract Agent, the Purchase Contract Agent
shall be under a duty to examine the same to determine whether or not
they conform to the requirements of this Agreement or the Pledge
Agreement, as applicable (but need not confirm or investigate the
accuracy of the mathematical calculations or other facts stated
therein).
(b) No provision of this Agreement or the Pledge Agreement shall be
construed to relieve the Purchase Contract Agent from liability for its own
grossly negligent action, its own grossly negligent failure to act, or its own
willful misconduct, except that:
(i) this Subsection shall not be construed to limit the
effect of Subsection (a) of this Section;
(ii) the Purchase Contract Agent shall not be liable for any
error of judgment made in good faith by a Responsible Officer, unless it
shall be proved that the Purchase Contract Agent was grossly negligent
in ascertaining the pertinent facts; and
(iii) no provision of this Agreement or the Pledge Agreement
shall require the Purchase Contract Agent to expend or risk its own
funds or otherwise incur any financial liability in the performance of
any of its duties hereunder, or in the exercise of any of its rights or
powers, if indemnity satisfactory to the Purchase Contract Agent is not
provided to it.
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(iv) the Purchase Contract Agent shall not be liable with
respect to any action taken or omitted to be taken by it in good faith
in accordance with the direction of the Holders of a majority in
liquidation amount or principal amount, as the case may be, of the
Outstanding Securities.
(c) Whether or not therein expressly so provided, every provision of
this Agreement and the Pledge Agreement relating to the conduct or affecting the
liability of or affording protection to the Purchase Contract Agent shall be
subject to the provisions of this Section.
(d) The Purchase Contract Agent is authorized to execute and deliver the
Pledge Agreement in its capacity as Purchase Contract Agent.
SECTION 7.02. Notice of Default.
Within 30 days after the occurrence of any default by the Company
hereunder of which a Responsible Officer of the Purchase Contract Agent has
actual knowledge, the Purchase Contract Agent shall transmit by mail to the
Company and the Holders of Securities, as their names and addresses appear in
the Security Register, notice of such default hereunder, unless such default
shall have been cured or waived.
SECTION 7.03. Certain Rights of Purchase Contract Agent.
Subject to the provisions of Section 7.01:
(i) the Purchase Contract Agent may conclusively rely and
shall be fully protected in acting or refraining from acting upon any
resolution, certificate, statement, instrument, opinion, report, notice,
request, direction, consent, order, bond, Subordinated Note, note, other
evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or
parties;
(ii) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by an Officers' Certificate, Issuer
Order or Issuer Request, and any resolution of the Board of Directors of
the Company may be sufficiently evidenced by a Board Resolution;
(iii) whenever in the administration of this Agreement or the
Pledge Agreement the Purchase Contract Agent shall deem it desirable
that a matter be proved or established prior to taking, suffering or
omitting any action hereunder, the Purchase Contract Agent (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, conclusively rely upon an Officers' Certificate of
the Company;
(iv) the Purchase Contract Agent may consult with counsel of
its selection and the advice of such counsel or any Opinion of Counsel
shall be full
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and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon;
(v) the Purchase Contract Agent shall not be bound to make
any investigation into the facts or matters stated in any resolution,
certificate, statement, instrument, opinion, report, notice, request,
direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Purchase Contract
Agent, in its discretion, and at the expense of the Company, may make
reasonable further inquiry or investigation into such facts or matters
related to the execution, delivery and performance of the Purchase
Contracts as it may see fit, and, if the Purchase Contract Agent shall
determine to make such further inquiry or investigation, it shall be
given a reasonable opportunity to examine the relevant books, records
and premises of the Company, personally or by agent or attorney and
shall incur no liability or additional liability of any kind by reason
of such inquiry or investigation;
(vi) the Purchase Contract Agent may execute any of the
powers hereunder or perform any duties hereunder either directly or by
or through agents or attorneys or an Affiliate and the Purchase Contract
Agent shall not be responsible for any misconduct or negligence on the
part of any agent or attorney or an Affiliate appointed with due care by
it hereunder;
(vii) the Purchase Contract Agent shall be under no obligation
to exercise any of the rights or powers vested in it by this Agreement
at the request or direction of any of the Holders pursuant to this
Agreement, unless such Holders shall have offered to the Purchase
Contract Agent security or indemnity satisfactory to the Purchase
Contract Agent against the costs, expenses and liabilities which might
be incurred by it in compliance with such request or direction;
(viii) the Purchase Contract Agent shall not be liable for any
action taken, suffered, or omitted to be taken by it in good faith and
reasonably believed by it to be authorized or within the discretion or
rights or powers conferred upon it by this Agreement;
(ix) the Purchase Contract Agent shall not be deemed to have
notice of any default or event of default unless a Responsible Officer
of the Purchase Contract Agent has actual knowledge thereof or unless
written notice of any event which is in fact such a default is received
by the Purchase Contract Agent at the Corporate Trust Office of the
Purchase Contract Agent, and such notice references the Securities and
this Agreement;
(x) the Purchase Contract Agent may request that the Company
deliver an Officers' Certificate setting forth the names of individuals
and/or titles of officers authorized at such time to take specified
actions pursuant to this Agreement, which Officers' Certificate may be
signed by any person authorized
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to sign an Officers' Certificate, including any person specified as so
authorized in any such certificate previously delivered and not
superseded; and
(xi) the rights, privileges, protections, immunities and
benefits given to the Purchase Contract Agent, including, without
limitation, its right to be indemnified, are extended to, and shall be
enforceable by, the Purchase Contract Agent in each of its capacities
hereunder, and to each agent, custodian and other Person employed to act
hereunder.
SECTION 7.04. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Certificates shall be taken as
the statements of the Company, and the Purchase Contract Agent assumes no
responsibility for their accuracy. The Purchase Contract Agent makes no
representations as to the validity or sufficiency of either this Agreement or of
the Securities, or of the Pledge Agreement or the Pledge. The Purchase Contract
Agent shall not be accountable for the use or application by the Company of the
proceeds in respect of the Purchase Contracts.
SECTION 7.05. May Hold Securities.
Any Security Registrar or any other agent of the Company, or the
Purchase Contract Agent and its Affiliates, in their individual or any other
capacity, may become the owner or pledgee of Securities and may otherwise deal
with the Company, the Collateral Agent or any other Person with the same rights
it would have if it were not Security Registrar or such other agent, or the
Purchase Contract Agent. The Company may become the owner or pledgee of
Securities.
SECTION 7.06. Money Held in Custody.
Money held by the Purchase Contract Agent in custody hereunder need not
be segregated from the other funds except to the extent required by law or
provided herein. The Purchase Contract Agent shall be under no obligation to
invest or pay interest on any money received by it hereunder except as otherwise
provided hereunder agreed in writing with the Company.
SECTION 7.07. Compensation and Reimbursement.
The Company agrees:
(i) to pay to the Purchase Contract Agent compensation for
all services rendered by it hereunder and under the Pledge Agreement as
the Company and the Purchase Contract Agent shall from time to time
agree in writing;
(ii) except as otherwise expressly provided for herein, to
reimburse the Purchase Contract Agent upon its request for all
reasonable expenses,
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disbursements and advances incurred or made by the Purchase Contract
Agent in accordance with any provision of this Agreement or the Pledge
Agreement (including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its gross negligence
or willful misconduct; and
(iii) to indemnify the Purchase Contract Agent and any
predecessor Purchase Contract Agent for, and to hold it harmless
against, any loss, liability or expense incurred without gross
negligence or willful misconduct 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 (whether asserted by the Company, a Holder or any other
Person) or liability in connection with the exercise or performance of
any of its powers or duties hereunder.
SECTION 7.08. Corporate Purchase Contract Agent Required; Eligibility.
There shall at all times be a Purchase Contract Agent hereunder which
shall be a corporation organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under such laws to exercise corporate trust powers, having (or being a member of
a bank holding company having) a combined capital and surplus of at least
$50,000,000, subject to supervision or examination by Federal or State authority
and having a corporate trust office in the Borough of Manhattan, New York City,
if there be such a corporation in the Borough of Manhattan, New York City,
qualified and eligible under this Article and willing to act on reasonable
terms. If such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Purchase Contract Agent shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.
SECTION 7.09. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Purchase Contract Agent and no
appointment of a successor Purchase Contract Agent pursuant to this Article
shall become effective until the acceptance of appointment by the successor
Purchase Contract Agent in accordance with the applicable requirements of
Section 7.10.
(b) The Purchase Contract Agent may resign at any time by giving written
notice thereof to the Company 60 days prior to the effective date of such
resignation. If the instrument of acceptance by a successor Purchase Contract
Agent required by Section 7.10 shall not have been delivered to the Purchase
Contract Agent within 30 days after the giving of such notice of resignation,
the resigning Purchase Contract Agent may
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petition, at the expense of the Company, any court of competent jurisdiction for
the appointment of a successor Purchase Contract Agent.
(c) The Purchase Contract Agent may be removed at any time by Act of the
Holders of a majority in number of the Outstanding Securities delivered to the
Purchase Contract Agent and the Company.
(d) If at any time:
(i) the Purchase Contract Agent fails to comply with Section
310(b) of the TIA, as if the Purchase Contract Agent were an indenture
trustee under an indenture qualified under the TIA, after written
request therefor by the Company or by any Holder who has been a bona
fide Holder of a Security for at least six months;
(ii) the Purchase Contract Agent shall cease to be eligible
under Section 7.08 and shall fail to resign after written request
therefor by the Company or by any such Holder; or
(iii) the Purchase Contract Agent shall become incapable of
acting or shall be adjudged a bankrupt or insolvent or a receiver of the
Purchase Contract Agent or of its property shall be appointed or any
public officer shall take charge or control of the Purchase Contract
Agent or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Purchase Contract Agent, or (ii) any Holder who has been a bona fide Holder of a
Security for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the removal
of the Purchase Contract Agent and the appointment of a successor Purchase
Contract Agent.
(e) If the Purchase Contract Agent shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Purchase
Contract Agent for any cause, the Company, by a Board Resolution, shall promptly
appoint a successor Purchase Contract Agent and shall comply with the applicable
requirements of Section 7.10. If no successor Purchase Contract Agent shall have
been so appointed by the Company and accepted appointment in the manner required
by Section 7.10, any Holder who has been a bona fide Holder of a Security for at
least six months, on behalf of itself and all others similarly situated, or the
Purchase Contract Agent may petition at the expense of the Company, any court of
competent jurisdiction for the appointment of a successor Purchase Contract
Agent.
(f) The Company shall give, or shall cause such successor Purchase
Contract Agent to give, notice of each resignation and each removal of the
Purchase Contract Agent and each appointment of a successor Purchase Contract
Agent by mailing written notice of such event by first-class mail, postage
prepaid, to all Holders as their names and
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addresses appear in the applicable Register. Each notice shall include the name
of the successor Purchase Contract Agent and the address of its Corporate Trust
Office.
SECTION 7.10. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Purchase
Contract Agent, every such successor Purchase Contract Agent so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Purchase
Contract Agent an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Purchase Contract Agent shall become
effective and such successor Purchase Contract Agent, without any further act,
deed or conveyance, shall become vested with all the rights, powers, agencies
and duties of the retiring Purchase Contract Agent; but, on the request of the
Company or the successor Purchase Contract Agent, such retiring Purchase
Contract Agent shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Purchase Contract Agent all the
rights, powers and trusts of the retiring Purchase Contract Agent and shall duly
assign, transfer and deliver to such successor Purchase Contract Agent all
property and money held by such retiring Purchase Contract Agent hereunder.
(b) Upon request of any such successor Purchase Contract Agent, the
Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Purchase Contract Agent all such
rights, powers and agencies referred to in paragraph 7.10(a) of this Section.
(c) No successor Purchase Contract Agent shall accept its appointment
unless at the time of such acceptance such successor Purchase Contract Agent
shall be qualified and eligible under this Article.
SECTION 7.11. Merger, Conversion, Consolidation or Succession to
Business.
Any corporation into which the Purchase Contract 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 Purchase Contract
Agent shall be a party, or any corporation succeeding to all or substantially
all the corporate trust business of the Purchase Contract Agent, shall be the
successor of the Purchase Contract Agent hereunder, provided such corporation
shall be otherwise qualified and eligible under this Article, with the execution
or filing of any paper or any further act on the part of any of the parties
hereto. In case any Certificates shall have been authenticated and executed on
behalf of the Holders, but not delivered, by the Purchase Contract Agent then in
office, any successor by merger, conversion or consolidation to such Purchase
Contract Agent may adopt such authentication and execution and deliver the
Certificates so authenticated and executed with the same effect as if such
successor Purchase Contract Agent had itself authenticated and executed such
Securities.
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SECTION 7.12. Preservation of Information; Communications to Holders.
(a) The Purchase Contract Agent shall preserve, in as current a form as
is reasonably practicable, the names and addresses of Holders received by the
Purchase Contract Agent in its capacity as Security Registrar.
(b) If three or more Holders (herein referred to as "APPLICANTS") apply
in writing to the Purchase Contract Agent, and furnish to the Purchase Contract
Agent reasonable proof that each such applicant has owned a Security for a
period of at least six months preceding the date of such application, and such
application states that the applicants desire to communicate with other Holders
with respect to their rights under this Agreement or under the Securities and is
accompanied by a copy of the form of proxy or other communication which such
applicants propose to transmit, then the Purchase Contract Agent shall mail to
all the Holders copies of the form of proxy or other communication which is
specified in such request, with reasonable promptness after a tender to the
Purchase Contract Agent of the materials to be mailed and of payment, or
provision for the payment, of the reasonable expenses of such mailing.
SECTION 7.13. No Obligations of Purchase Contract Agent.
Except to the extent otherwise expressly provided in this Agreement, the
Purchase Contract Agent assumes no obligations and shall not be subject to any
liability under this Agreement, the Pledge Agreement or any Purchase Contract in
respect of the obligations of the Holder of any Security thereunder. The Company
agrees, and each Holder of a Certificate, by his acceptance thereof, shall be
deemed to have agreed, that the Purchase Contract Agent's execution of the
Certificates on behalf of the Holders shall be solely as agent and
attorney-in-fact for the Holders, and that the Purchase Contract Agent shall
have no obligation to perform such Purchase Contracts on behalf of the Holders,
except to the extent expressly provided in Article Five hereof. Anything
contained in this Agreement to the contrary notwithstanding, in no event shall
the Purchase Contract Agent or its officers, employees or agents be liable under
this Agreement to any third party for indirect, special, punitive, or
consequential loss or damage of any kind whatsoever, including lost profits,
whether or not the likelihood of such loss or damage was known to the Purchase
Contract Agent, incurred without any act or deed that is found to be
attributable to gross negligence or willful misconduct on the part of the
Purchase Contract Agent.
SECTION 7.14. Tax Compliance.
(a) The Company and the Purchase Contract Agent 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 (1) any payments made with respect to
the Securities or (2) 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
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required returns and the timely payment of all amounts required to be withheld
to the appropriate taxing authority or its designated agent.
(b) The Purchase Contract Agent shall comply in accordance with the
terms hereof with any written direction received from the Company with respect
to the execution or certification of any required documentation and the
application of such requirements to particular payments or Holders or in other
particular circumstances, and may for purposes of this Agreement conclusively
rely on any such direction in accordance with the provisions of Section
7.01(a)(2) hereof.
(c) The Purchase Contract Agent shall maintain all appropriate records
documenting compliance with such requirements, and shall make such records
available, on written request, to the Company or its authorized representative
within a reasonable period of time after receipt of such request.
ARTICLE 8
SUPPLEMENTAL AGREEMENTS
SECTION 8.01. Supplemental Agreements Without Consent of Holders.
Without the consent of any Holders, the Company and the Purchase
Contract Agent, at any time and from time to time, may enter into one or more
agreements supplemental hereto, in form satisfactory to the Company and the
Purchase Contract Agent, to:
(i) 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;
(ii) evidence and provide for the acceptance of appointment
hereunder by a successor Purchase Contract Agent;
(iii) add to the covenants of the Company for the benefit of
the Holders, or surrender any right or power herein conferred upon the
Company;
(iv) make provision with respect to the rights of Holders
pursuant to the requirements of Section 5.05(b); or
(v) except as provided for in Section 5.05, cure any
ambiguity, correct or supplement any provisions herein which may be
inconsistent with any other provisions herein, or make any other
provisions with respect to such matters or questions arising under this
Agreement, provided such action shall not adversely affect the interests
of the Holders.
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SECTION 8.02. Supplemental Agreements with Consent of Holders.
With the consent of the Holders of not less than a majority of the
outstanding Securities voting together as one class, by Act of said Holders
delivered to the Company and the Purchase Contract Agent, the Company, when
authorized by a Board Resolution, and the Purchase Contract Agent may enter into
an agreement or agreements supplemental hereto for the purpose of modifying in
any manner the terms of the Purchase Contracts, or the provisions of this
Agreement or the rights of the Holders in respect of the Securities; provided,
however, that, except as contemplated herein, no such supplemental agreement
shall, without the unanimous consent of the Holders of each outstanding Purchase
Contract affected thereby:
(i) change any Payment Date;
(ii) change the amount or the type of Collateral required to
be Pledged to secure a Holder's obligations under the Purchase Contract,
impair the right of the Holder of any Purchase Contract to receive
distributions on the related Collateral (except for the rights of
Holders of PEPS Units to substitute Treasury Securities for the Pledged
Preferred Securities or Pledged Subordinated Notes or the Applicable
Ownership Interest of the Treasury Portfolio or the rights of Holders or
Treasury PEPS Units to substitute Preferred Securities, Subordinated
Notes or the Applicable Ownership Interest of the Treasury Portfolio 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;
(iii) reduce any Contract Adjustment Payments, if any, or
change any place where, or the coin or currency in which, any Contract
Adjustment Payment is payable;
(iv) impair the right to institute suit for the enforcement
of any Purchase Contract or any Contract Adjustment Payment, if any;
(v) 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
or change the Purchase Contract Settlement Date or otherwise adversely
affect the Holder's rights under a Purchase Contract; or
(vi) 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 PEPS Units or only the Treasury PEPS Units, then only the
affected class of Holders as of the record date for the Holders entitled to vote
thereon will be entitled to vote on such amendment or proposal, and such
amendment or proposal shall not be effective except with the consent of Holders
of not less than a majority of such class; and
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provided, further, that the unanimous consent of the Holders of each outstanding
Purchase Contract of such class affected thereby shall be required to approve
any amendment or proposal specified in clauses (1) through (6) above.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental agreement, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 8.03. Execution of Supplemental Agreements.
In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Purchase Contract Agent shall be
provided, and (subject to Section 7.01) shall be fully protected in relying
upon, an Officers' Certificate and an Opinion of Counsel stating that the
execution of such supplemental agreement is authorized or permitted by this
Agreement and that all conditions precedent to the execution and delivery of
such supplemental agreement have been satisfied. The Purchase Contract Agent
may, but shall not be obligated to, enter into any such supplemental agreement
which affects the Purchase Contract Agent's own rights, duties or immunities
under this Agreement or otherwise.
SECTION 8.04. Effect of Supplemental Agreements.
Upon the execution of any supplemental agreement under this Article,
this Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of this Agreement for all purposes; and every Holder
of Certificates theretofore or thereafter authenticated, executed on behalf of
the Holders and delivered hereunder, shall be bound thereby.
SECTION 8.05. Reference to Supplemental Agreements.
Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Purchase Contract Agent, bear a
notation in form approved by the Purchase Contract Agent as to any matter
provided for in such supplemental agreement. If the Company shall so determine,
new Certificates so modified as to conform, in the opinion of the Purchase
Contract Agent and the Company, to any such supplemental agreement may be
prepared and executed by the Company and authenticated, executed on behalf of
the Holders and delivered by the Purchase Contract Agent in exchange for
outstanding Certificates.
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ARTICLE 9
MERGER, CONSOLIDATION, SHARE EXCHANGE, SALE OR CONVEYANCE
SECTION 9.01. Covenant Not to Merge, Consolidate, Enter into a Share
Exchange, Sell or Convey Property Except Under Certain Conditions.
The Company covenants that it will not merge, consolidate or enter into
a share exchange 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, the Remarketing Agreement and the Pledge
Agreement by one or more supplemental agreements in form reasonably
satisfactory to the Purchase Contract Agent and the Collateral Agent,
executed and delivered to the Purchase Contract Agent and the Collateral
Agent by such corporation; and
(ii) the Company or such successor corporation, as the case
may be, shall not, immediately after such merger, consolidation or share
exchange, 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 9.02. Rights and Duties of Successor Corporation.
In case of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance and upon any such assumption by a
successor corporation in accordance with Section 9.01, such successor
corporation shall succeed to and be substituted for the Company with the same
effect as if it had been named herein as the Company. Such successor corporation
thereupon may cause to be signed, and may issue either in its own name or in the
name of PPL 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 Purchase Contract Agent; and, upon the order of such
successor corporation, instead of the Company, and subject to all the terms,
conditions and limitations in this Agreement prescribed, the Purchase Contract
Agent shall authenticate and execute on behalf of the Holders and deliver any
Certificates which previously shall have been signed and delivered by the
officers of the Company to the Purchase Contract Agent for authentication and
execution, and any Certificate evidencing Securities which such successor
corporation thereafter shall cause to be signed and delivered to the Purchase
Contract Agent for that purpose. All the Certificates issued shall in all
respects have the same legal rank and benefit under this Agreement as the
Certificates theretofore or thereafter issued in accordance with the terms of
this
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Agreement as though all of such Certificates had been issued at the date of the
execution hereof.
In case of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance such change in phraseology and form
(but not in substance) may be made in the Certificates evidencing Securities
thereafter to be issued as may be appropriate.
SECTION 9.03. Officers' Certificate and Opinion of Counsel Given to
Purchase Contract Agent.
The Purchase Contract Agent, subject to Sections 7.01 and 7.03, shall
receive an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that any such merger, consolidation, share exchange, sale, assignment,
transfer, lease or conveyance, and any such assumption, complies with the
provisions of this Article and that all conditions precedent to the consummation
of any such merger, consolidation, share exchange, sale, assignment, transfer,
lease or conveyance have been met.
ARTICLE 10
COVENANTS
SECTION 10.01. Performance under Purchase Contracts.
The Company covenants and agrees for the benefit of the Holders from
time to time of the Securities that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.
SECTION 10.02. Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhattan, New York City an
office or agency (a "New York Office") where Certificates may be presented or
surrendered for acquisition of shares of Common Stock upon settlement of the
Purchase Contracts on the Purchase Contract Settlement Date or Early Settlement
and for transfer of Collateral upon occurrence of a Termination Event, where
Certificates may be surrendered for registration of transfer or exchange, for a
Collateral Substitution or reestablishment of PEPS Units and where notices and
demands to or upon the Company in respect of the Securities and this Agreement
may be served. The Company will give prompt written notice to the Purchase
Contract Agent of the location, and any change in the location, of such office
or agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Purchase Contract Agent with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the Corporate Trust Office, and the Company hereby appoints the
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Purchase Contract Agent as its agent to receive all such presentations,
surrenders, notices and demands.
The Company may also from time to time designate one or more other
offices or agencies where Certificates may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, New York City for such purposes. The Company will give
prompt written notice to the Purchase Contract Agent of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby designates as the place of payment for the Securities the
Corporate Trust Office and appoints the Purchase Contract Agent at its Corporate
Trust Office as paying agent in such city.
SECTION 10.03. Company to Reserve Common Stock.
The Company shall at all times prior to the Purchase Contract Settlement
Date reserve and keep available, free from preemptive rights, out of its
authorized but unissued Common Stock the full number of shares of Common Stock
issuable against tender of payment in respect of all Purchase Contracts
constituting a part of the Securities evidenced by Outstanding Certificates.
SECTION 10.04. Covenants as to Common Stock.
The Company covenants that all shares of Common Stock which may be
issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Securities will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable. The Company shall
comply, in all material respects, with all applicable securities laws regulating
the offer, issuance and delivery of shares of Common Stock upon settlement of
Purchase Contracts and will endeavor to list such shares on each national
securities exchange or automated quotation system on which the Common Stock is
then listed.
SECTION 10.05. Statements of Officers of the Company as to Default.
The Company will deliver to the Purchase Contract Agent, within 140 days
after the end of each fiscal year of the Company (which as of the date hereof is
December 31) ending after the date hereof, an Officers' Certificate (one of the
signers of which shall be the principal executive officer, principal financial
officer or principal accounting officer of the Company), stating whether or not
to the knowledge of the signers thereof the Company is in default in the
performance and observance of any of the terms, provisions and conditions
hereof, and if the Company shall be in default, specifying all such defaults and
the nature and status thereof of which they may have knowledge.
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SECTION 10.06. ERISA.
Each Holder from time to time of the Securities that is a Plan hereby
represents that its acquisition of the PEPS Units and the holding of the same
satisfies the applicable fiduciary requirements of ERISA and that it is entitled
to exemption relief from the prohibited transaction provisions of ERISA and the
Code in accordance with one or more prohibited transaction exemptions or
otherwise will not result in a nonexempt prohibited transaction.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
PPL CORPORATION
By: /s/ Xxxxx X. Xxxx
-------------------------
Name: Xxxxx X. Xxxx
Title: Vice President-Finance and
Treasurer
THE CHASE MANHATTAN BANK,
as Purchase Contract Agent
By: /s/ Xxxxxxx X. Xxxxxxx
--------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
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EXHIBIT A
FACE OF PEPS UNITS CERTIFICATE
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"),
OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR
CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS
CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
No. _________ Cusip No. 00000X000
Number of PEPS Units ___________
PPL CORPORATION
PPL CAPITAL FUNDING TRUST I
PEPS UNITS
This PEPS Units Certificate certifies that Cede & Co. is the registered
Holder of the number of PEPS Units set forth above. Each PEPS Unit consists of
(i) either (a) the beneficial ownership by the Holder of one Preferred Security
(the "PREFERRED SECURITY") of PPL Capital Funding Trust I, a Delaware statutory
business trust (the "TRUST"), having a stated liquidation amount of $25, subject
to the Pledge of such Preferred Security by such Holder pursuant to the Pledge
Agreement, or (b) upon the occurrence of a Tax Event Redemption or Successful
Initial Remarketing prior to the Purchase Contract Settlement Date, the
appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio by such Holder pursuant to
the Pledge
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Agreement, and (ii) the rights and obligations of the Holder under
one Purchase Contract with PPL Corporation, a Delaware corporation (the
"COMPANY"). All capitalized terms used herein which are defined in the Purchase
Contract Agreement (as defined on the reverse hereof) have the meaning set forth
therein.
Pursuant to the Pledge Agreement, the Preferred Securities or the
appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, as the case may be,
constituting part of each PEPS Unit evidenced hereby has been pledged to the
Collateral Agent, for the benefit of the Company, to secure the obligations of
the Holder under the Purchase Contract comprising part of such PEPS Unit.
The Pledge Agreement provides that all payments of the liquidation
amount with respect to any of the Pledged Preferred Securities or the
appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, as the case may be, or cash
distributions on any Pledged Preferred Securities (as defined in the Pledge
Agreement) or the appropriate Applicable Ownership Interest (as specified in
clause (B) of the definition of such term) of the Treasury Portfolio, as the
case may be, constituting part of the PEPS Units received by the Securities
Intermediary shall be paid by wire transfer in same day funds (i) in the case of
(A) cash distributions with respect to Pledged Preferred Securities or the
appropriate Applicable Ownership Interest (as specified in clause (B) of the
definition of such term) of the Treasury Portfolio, as the case may be, and (B)
any payments of the liquidation amount with respect to any Preferred Securities
or the appropriate Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio, as the case may be, that
have been released from the Pledge pursuant to the Pledge Agreement, to the
Purchase Contract Agent to the account designated by the Purchase Contract
Agent, no later than 2:00 p.m., New York City time, on the Business Day such
payment is received by the Securities Intermediary (provided that in the event
such payment is received by the Securities Intermediary on a day that is not a
Business Day or after 12:30 p.m., New York City time, on a Business Day, then
such payment shall be made no later than 10:30 a.m., New York City time, on the
next succeeding Business Day) and (ii) in the case of payments of the
liquidation amount with respect to any of the Pledged Preferred Securities or
the appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, to the Company on the
Purchase Contract Settlement Date (as described herein) in accordance with the
terms of the Pledge Agreement, in full satisfaction of the respective
obligations of the Holders of the PEPS Units of which such Pledged Preferred
Securities or the Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio, as the case may be, are
a part under the Purchase Contracts forming a part of such PEPS Units.
Distributions on any Preferred Security or the appropriate Applicable Ownership
Interest (as specified in clause (B) of the definition of such term) of the
Treasury Portfolio, as the case may be, forming part of a PEPS Unit evidenced
hereby, which are payable quarterly in arrears on February 18, May 18, August 18
and November 18, of each year, commencing August 18, 2001 (a "PAYMENT
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DATE"), shall, subject to receipt thereof by the Purchase Contract Agent from
the Securities Intermediary, be paid to the Person in whose name this PEPS Unit
Certificate (or a Predecessor PEPS Unit Certificate) is registered at the close
of business on the Record Date for such Payment Date.
Each Purchase Contract evidenced hereby obligates the Holder of this
PEPS Units Certificate to purchase, and the Company to sell, on May 18, 2004
(the "PURCHASE CONTRACT SETTLEMENT DATE"), at a price equal to $25 (the "STATED
AMOUNT"), a number of shares of Common Stock, $0.01 par value ("COMMON STOCK"),
of the Company, equal to the Settlement Rate, unless on or prior to the Purchase
Contract Settlement Date there shall have such occurred a Termination Event or
an Early Settlement with respect to the PEPS Unit of which such Purchase
Contract is a part, all as provided in the Purchase Contract Agreement and more
fully described on the reverse hereof. The purchase price (the "PURCHASE PRICE")
for the shares of Common Stock purchased pursuant to each Purchase Contract
evidenced hereby, if not paid earlier, shall be paid on the Purchase Contract
Settlement Date by application of payment received in respect of the liquidation
amount with respect to any Pledged Preferred Securities pursuant to the
Remarketing or the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, as the
case may be, pledged to secure the obligations under such Purchase Contract of
the Holder of the PEPS Unit of which such Purchase Contract is a part.
Distributions on the Preferred Securities and the Applicable Ownership
Interest (as specified in clause (B) of the definition of such term) will be
payable at the office of the Purchase Contract Agent in New York City or, at the
option of the Company, by check mailed to the address of the Person entitled
thereto as such address appears on the PEPS Units Register.
The Company shall pay on each Payment Date in respect of each Purchase
Contract forming part of a PEPS Unit evidenced hereby an amount (the "Contract
Adjustment Payments") equal to 0.46% per annum of the Stated Amount, or $0.1150
per annum, computed on the basis of a 360-day year of twelve 30 day months. Such
Contract Adjustment Payments, if any, shall be payable to the Person in whose
name this PEPS Units Certificate (or a Predecessor PEPS Units 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 Corporate
Trust Office of the Purchase Contract Agent and at the New York Office or, at
the option of the Company, by check mailed to the address of the Person entitled
thereto as such address appears on the Securities 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.
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Unless the certificate of authentication hereon has been executed by the
Purchase Contract Agent by manual signature, this PEPS Units Certificate shall
not be entitled to any benefit under the Pledge Agreement or the Purchase
Contract Agreement or be valid or obligatory for any purpose.
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IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
PPL CORPORATION
By:
-------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the Purchase
Contracts)
By: THE CHASE MANHATTAN BANK,
not individually but solely as
Attorney-in-Fact of such Holder
By:
-------------------------
Name:
Title:
DATED:
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CERTIFICATE OF AUTHENTICATION
OF PURCHASE CONTRACT AGENT
This is one of the PEPS Units Certificates referred to in the within
mentioned Purchase Contract Agreement.
By: THE CHASE MANHATTAN
BANK, as Purchase Contract Agent
By:
-------------------------
Authorized Officer
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(FORM OF REVERSE OF PEPS UNITS CERTIFICATE)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of May 9, 2001 (as may be supplemented from time to
time, the "PURCHASE CONTRACT AGREEMENT"), between the Company and The Chase
Manhattan Bank, as Purchase Contract Agent (including its successors hereunder,
the "PURCHASE CONTRACT AGENT"), to which Purchase Contract Agreement and
supplemental agreements thereto reference is hereby made for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Purchase Contract Agent, the Company, and the Holders and of
the terms upon which the PEPS Units Certificates are, and are to be, executed
and delivered.
Unless a Cash Settlement or an Early Settlement has occurred, each
Purchase Contract evidenced hereby obligates the Holder of this PEPS Units
Certificate to purchase, and the Company to sell, on the Purchase Contract
Settlement Date at a price equal to the Stated Amount (the "PURCHASE PRICE"), a
number of shares of Common Stock equal to the Settlement Rate, unless, prior to
or on the Purchase Contract Settlement Date, there shall have occurred a
Termination Event with respect to the Security of which such Purchase Contract
is a part or an Early Settlement shall have occurred. The "SETTLEMENT RATE" is
equal to:
(1) if the Applicable Market Value (as defined below) is
greater than or equal to $65.03 (the "THRESHOLD APPRECIATION PRICE"),
0.3845 shares of Common Stock per Purchase Contract;
(2) if the Applicable Market Value is less than the
Threshold Appreciation Price but greater than $53.30 (the "REFERENCE
PRICE"), the number of shares of Common Stock per Purchase Contract
having a value, based on the Applicable Market Value, equal to $25; and
(3) if the Applicable Market Value is less than or equal to
the Reference Price, 0.4690 shares of Common Stock per Purchase
Contract,
in each case subject to adjustment as provided in the Purchase Contract
Agreement (and in each case rounded upward or downward to the nearest 1/10,000th
of a share).
No fractional shares of Common Stock will be issued upon settlement of
Purchase Contracts, as provided in Section 5.09 of the Purchase Contract
Agreement.
Each Purchase Contract evidenced hereby, which is settled either through
Early Settlement or Cash Settlement, shall obligate the Holder of the related
PEPS Unit to purchase at the Purchase Price, and the Company to sell, a number
of shares of Common Stock equal to the Early Settlement Rate or the Settlement
Rate, as applicable.
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The "APPLICABLE MARKET VALUE" means the average of the Closing Price per
share of Common Stock on each of the 20 consecutive Trading Days ending on the
third Trading Day immediately preceding the Purchase Contract Settlement Date.
The "CLOSING PRICE" per share of Common Stock on any date of
determination means:
(1) the closing sale price (or, if no closing price is
reported, the last reported sale price) per share on the New York Stock
Exchange, Inc. (the "NYSE") on such date;
(2) if Common Stock is not listed for trading on the NYSE on
any such date, the closing sale price per share as reported in the
composite transactions for the principal United States securities
exchange on which Common Stock is so listed;
(3) if Common Stock is not so listed on a United States
national or regional securities exchange, the closing sale price per
share as reported by The NASDAQ Stock Market, Inc.;
(4) if Common Stock is not so reported, the last quoted bid
price for Common Stock in the over-the-counter market as reported by the
National Quotation Bureau or similar organization; or
(5) if such bid price is not available, the average of the
mid-point of the last bid and ask prices of Common Stock on such date
from at least three nationally recognized independent investment banking
firms retained for this purpose by the Company.
A "TRADING DAY" means a day on which Common Stock (1) is not suspended
from trading on any national or regional securities exchange or association or
over-the-counter market at the close of business and (2) has traded at least
once on the national or regional securities exchange or association or
over-the-counter market that is the primary market for the trading of Common
Stock.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this PEPS Units Certificate may pay the Purchase Price for the shares
of Common Stock purchased pursuant to each Purchase Contract evidenced hereby by
effecting a Cash Settlement or an Early Settlement or from the proceeds of the
Applicable Ownership Interest (as specified in clause (A) of the definition of
such term) of the Treasury Portfolio or a Remarketing of the related Pledged
Preferred Securities. Unless a Tax Event Redemption or a Successful Initial
Remarketing has occurred, a Holder of PEPS Units who does not elect to make an
effective cash settlement, on or prior to 5:00 p.m. (New York City time) on the
fifth Business Day immediately preceding the Purchase Contract Settlement Date,
or elects to make such Cash Settlement, but fails to pay such cash on the fourth
Business Day immediately preceding the Purchase Contract Settlement
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Date, or does not elect to make an effective Early Settlement, shall pay the
Purchase Price for the shares of Common Stock to be delivered under the related
Purchase Contract from the proceeds of the sale of the related Pledged Preferred
Securities held by the Collateral Agent. Unless a Tax Event Redemption or a
Successful Initial Remarketing has occurred, such sale will be made by the
Remarketing Agent pursuant to the terms of the Remarketing Agreement and any
supplemental remarketing agreement executed in connection therewith between the
parties thereto, on the third Business Day prior to the Purchase Contract
Settlement Date.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment of the aggregate purchase price for
the shares of Common Stock to be purchased thereunder in the manner herein set
forth.
Each Purchase Contract evidenced hereby and all obligations and rights
of the Company and the Holder thereunder shall terminate if a Termination Event
shall occur. Upon the occurrence of a Termination Event, the Company shall give
written notice to the Purchase Contract Agent and to the Holders, at their
addresses as they appear in the Security Register. Upon and after the occurrence
of a Termination Event, the Collateral Agent shall release the Pledged Preferred
Security or the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio forming a
part of each PEPS Unit from the Pledge. A PEPS Unit shall thereafter represent
the right to receive the Preferred Security or the appropriate Applicable
Ownership Interest of the Treasury Portfolio forming a part of such PEPS Unit in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement.
Under the terms of the Pledge Agreement, the Purchase Contract Agent
will be entitled to exercise the voting and any other consensual rights
pertaining to the Pledged Preferred Securities. Upon receipt of notice of any
meeting at which holders of Preferred Securities are entitled to vote or upon
the solicitation of consents, waivers or proxies of holders of Preferred
Securities, the Purchase Contract Agent shall, as soon as practicable
thereafter, mail to the PEPS Units Holders a notice:
(1) containing such information as is contained in the
notice or solicitation;
(2) stating that each PEPS Unit Holder on the record date
set by the Purchase Contract Agent therefor (which, to the extent
possible, shall be the same date as the record date for determining the
holders of Preferred Securities entitled to vote) shall be entitled to
instruct the Purchase Contract Agent as to the exercise of the voting
rights pertaining to the Preferred Securities constituting a part of
such Holder's PEPS Unit; and
(3) stating the manner in which such instructions may be
given.
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Upon the written request of the PEPS Unit Holders on such record date,
the Purchase Contract Agent shall endeavor insofar as practicable to vote or
cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of Preferred Securities as to which any particular
voting instructions are received. In the absence of specific instructions from
the Holder of a PEPS Unit, the Purchase Contract Agent shall abstain from voting
the Preferred Security evidenced by such PEPS Unit.
Upon the dissolution and liquidation of the Trust, a principal amount of
the Subordinated Notes 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 Securities Intermediary in
exchange for the Pledged Preferred Securities. Thereafter, the Subordinated
Notes shall be held by the Securities Intermediary to secure the obligations of
each Holder of PEPS Units to purchase shares of Common Stock under the Purchase
Contracts constituting a part of such PEPS Units. Following the dissolution and
liquidation of the Trust, the Holders and the Collateral Agent shall have such
security interests, rights and obligations with respect to the Subordinated
Notes as the Holders and the Collateral Agent had in respect of the Pledged
Preferred Securities, any reference herein to the Preferred Securities shall be
deemed to be a reference to the Subordinated Notes and any reference herein to
the liquidation amount of the Preferred Securities shall be deemed to be a
reference to the principal amount of the Subordinated Notes.
Upon the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, the Redemption Price payable on the Tax Event
Redemption Date with respect to the Applicable Amount of Subordinated Notes
shall be delivered to the Securities Intermediary in exchange for the Pledged
Preferred Securities. Thereafter, pursuant to the terms of the Pledge Agreement,
the Securities Intermediary will apply an amount equal to the Redemption Amount
of such Redemption Price to purchase on behalf of the Holders of PEPS Units, the
Treasury Portfolio and promptly (a) transfer the Applicable Ownership Interest
(as specified in clause (A) of the definition of such term) of the Treasury
Portfolio to the Collateral Account to secure the obligations of each Holder of
PEPS Units to purchase shares of Common Stock under the Purchase Contracts
constituting a part of such PEPS Units, (b) transfer the Applicable Ownership
Interest (as specified in clause (B) of the definition of such term) of the
Treasury Portfolio to the Purchase Contract Agent for the benefit of the Holders
of such PEPS Units and (C) remit the remaining portion of such Redemption Price
to the Purchase Contract Agent for payment to the Holders of such PEPS Units.
Upon the occurrence of a Successful Initial Remarketing, pursuant to the
terms of the Remarketing Agreement, the Remarketing Agent will apply an amount
equal to the Treasury Portfolio Purchase Price to purchase on behalf of the
Holders of PEPS Units, the Treasury Portfolio, and, after deducting the
Remarketing Fee to the extent permitted under the terms of the Remarketing
Agreement, promptly remit the remaining portion of
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such Proceeds of the Successful Initial Remarketing to the Agent for Payment to
the Holders of such PEPS units.
Following the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date or following a Successful Initial Remarketing, the
Holders of PEPS Units and the Collateral Agent shall have such security interest
rights and obligations with respect to the Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio as the Holder of PEPS Units and the Collateral Agent had in respect of
the Preferred Securities or Subordinated Notes, as the case may be, subject to
the Pledge thereof as provided in the Pledge Agreement and any reference herein
to the Preferred Securities shall be deemed to be a reference to such Treasury
Portfolio.
The PEPS Certificates are issuable only in registered form and only in
denominations of a single PEPS Unit and any integral multiple thereof. The
transfer of any PEPS Units Certificate will be registered and PEPS Units
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The Security Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents permitted by the Purchase
Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Purchase Contract
Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. A Holder who elects to
substitute a Treasury Security for Preferred Securities, thereby creating
Treasury PEPS Units, shall be responsible for any fees or expenses payable in
connection therewith. Except as provided in the Purchase Contract Agreement, for
so long as the Purchase Contract underlying a PEPS Unit remains in effect, such
PEPS Unit shall not be separable into its constituent parts, and the rights and
obligations of the Holder of such PEPS Unit in respect of the Preferred
Securities or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, and Purchase Contract constituting such PEPS Unit
may be transferred and exchanged only as a PEPS Unit.
The Holder of PEPS Units may substitute for the Pledged Preferred
Securities, securing such Holder's obligations under the related Purchase
Contracts, 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, each Security for which such Pledged
Treasury Securities secures the Holder's obligation under the Purchase Contract
shall be referred to as a "TREASURY PEPS UNIT". A Holder may make such
Collateral Substitution only in integral multiples of 40 PEPS Units for 40
Treasury PEPS Units. Such Collateral Substitution may cause the equivalent
aggregate Stated Amount of this Certificate to be increased or decreased;
provided, however, the equivalent aggregate Stated Amount outstanding under this
PEPS Units Certificate shall not exceed $500,000,000. All such adjustments to
the equivalent aggregate Stated Amount of this PEPS Units Certificate shall be
duly recorded by placing an appropriate notation on the Schedule attached
hereto.
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A Holder of Treasury PEPS Units may recreate PEPS Units by delivering to
the Securities Intermediary Preferred Securities, equal to the aggregate
principal amount of the Pledged Treasury Securities in exchange for the release
of such Pledged Treasury Securities in accordance with the terms of the Purchase
Contract Agreement and the Pledge Agreement. A Holder may recreate PEPS Units in
integral multiples of 40 Treasury PEPS Units for 40 PEPS Units; provided,
however, that if a Tax Event Redemption or a successful Initial Remarketing has
occurred and the Treasury Portfolio has become a component of the PEPS Units, a
Holder may not make such substitution.
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 PEPS Units 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 Corporate Trust
Office of the Purchase Contract Agent and the New York Office 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 Securities Register or by wire transfer to the
account designated by such Person in writing.
The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay Contract Adjustment
Payments, if any, and the rights and obligations of Holders to purchase Common
Stock, shall immediately and automatically terminate, without the necessity of
any notice or action by any Holder, the Purchase Contract Agent or the Company,
if, on or prior to the Purchase Contract Settlement Date, a Termination Event
shall have occurred. Upon the occurrence of a Termination Event, the Company
shall promptly but in no event later than two Business Days thereafter give
written notice to the Purchase Contract Agent, the Collateral Agent and the
Holders, at their addresses as they appear in the Security Register. Upon and
after the occurrence of a Termination Event, the Collateral Agent shall release
the Preferred Securities or the appropriate Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio, as the case may be, from the Pledge in accordance with the provisions
of the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
underlying Securities may be settled early ("EARLY SETTLEMENT") as provided in
the Purchase Contract Agreement; provided, however, that if a Tax Event
Redemption or a Successful Initial Remarketing has occurred and the Treasury
Portfolio has become a component of the PEPS Units, Holders may not make an
Early Settlement of their PEPS Units. In order to exercise the right to effect
Early Settlement with respect to any Purchase Contracts evidenced by this PEPS
Units Certificate, the Holder of this PEPS Units Certificate shall deliver to
the Purchase Contract Agent at the Corporate Trust Office an Election to Settle
Early form set forth below and any other documents requested by the Purchase
Contract Agent duly completed and accompanied by payment in the form of
immediately available funds payable to the order of the Company in an amount
(the "EARLY SETTLEMENT
A-12
101
AMOUNT") equal to (i) the product of (A) $25 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 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 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 a PEPS Unit as to which Early Settlement
is effected equal to 0.3845 shares of Common Stock per Purchase Contract (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 future Contract Adjustment Payments, except to the extent
that the Early Settlement Date is after the close of business on a Record Date
and prior to the opening of business on the corresponding Payment Date. The
Early Settlement Rate shall be adjusted in the same manner and at the same time
as the Settlement Rate is adjusted as provided in the Purchase Contract
Agreement.
Upon registration of transfer of this PEPS Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Purchase Contract Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this PEPS Units Certificate. The Company covenants and agrees, and
the Holder, by its acceptance hereof, likewise covenants and agrees, to be bound
by the provisions of this paragraph.
The Holder of this PEPS Units Certificate, by its acceptance hereof,
authorizes the Purchase Contract Agent to enter into and perform the related
Purchase Contracts forming part of the PEPS Units evidenced hereby on its behalf
as its attorney-in-fact, expressly withholds any consent to the assumption
(i.e., affirmance) of the Purchase Contracts by the Company or its trustee in
the event that the Company becomes the subject of a case under the Bankruptcy
Code, agrees to be bound by the terms and provisions thereof, covenants and
agrees to perform his obligations under such Purchase Contracts, consents to the
provisions of the Purchase Contract Agreement, authorizes the Purchase Contract
Agent to enter into and perform the Purchase Contract Agreement and the Pledge
Agreement on its behalf as its attorney-in-fact, and consents to the Pledge of
the Preferred Securities or the appropriate Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio, as the case may be, underlying this PEPS Units Certificate pursuant
to the Pledge Agreement. The Holder further covenants and agrees that, to the
extent and in the manner provided in the Purchase Contract Agreement and the
Pledge Agreement, but subject to the terms thereof, payments in respect to the
aggregate liquidation amount of the Pledged Preferred
A-13
102
Securities or the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, as the
case may be, on the Purchase Contract Settlement Date shall be paid by the
Collateral Agent to the Company in satisfaction of such Holder's obligations
under such Purchase Contract and such Holder shall acquire no right, title or
interest in such payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall be governed by, and construed in accordance
with, the laws of the State of New York.
The Company, the Purchase Contract Agent and its Affiliates and any
agent of the Company or the Purchase Contract Agent may treat the Person in
whose name this PEPS Units Certificate is registered as the owner of the PEPS
Units evidenced hereby for the purpose of receiving payments of distributions
payable quarterly on the Preferred Securities or interest on the maturing
quarterly interest strips of the Treasury Portfolio, as applicable, receiving
payments of Contract Adjustment Payments, if any, performance of the Purchase
Contracts and for all other purposes whatsoever, whether or not any payments in
respect thereof be overdue and notwithstanding any notice to the contrary, and
neither the Company, the Purchase Contract Agent nor any such agent shall be
affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection at
the Corporate Trust Office of the Purchase Contract Agent.
A-14
103
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM: as tenants in common
UNIF GIFT MIN ACT: Custodian
------------------- -------------------
(cust) (minor)
Under Uniform Gifts to Minors Act of
--------------------
---------------------------------------------------------
TENANT: as tenants by the entireties
JT TEN: as joint tenants with right of survivorship and not as
tenants in common
Additional abbreviations may also be used though not in the above list.
-----------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
-------------------------------------------------------------------------------
(Please insert Social Security or Taxpayer I.D. or
other Identifying Number of Assignee)
-------------------------------------------------------------------------------
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within PEPS Units Certificates and all rights thereunder, hereby irrevocably
constituting and appointing attorney __________________, to transfer said PEPS
Units Certificates on the books of PPL Corporation and PPL Capital Funding Trust
I 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 PEPS Units
Certificates in every particular, without
alteration or enlargement or any change
whatsoever.
Signature Guarantee:
-------------------------------
A-15
104
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 PEPS Units evidenced by
this PEPS Units Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional share, to the undersigned at
the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated:
--------------------- -------------------------------
Signature
Signature Guarantee:______________
(if assigned to another person)
If shares are to be registered in the name of
and delivered to a Person other than the REGISTERED HOLDER
Holder, please (i) print such Person's name
and address and (ii) provide a guarantee of Please print name and address of Registered
your signature: Holder:
------------------------------ ------------------------------
Name Name
------------------------------ ------------------------------
Address Address
------------------------------ ------------------------------
------------------------------ ------------------------------
------------------------------ ------------------------------
Social Security or other
Taxpayer Identification
Number, if any
------------------------------
A-16
105
ELECTION TO SETTLE EARLY
The undersigned Holder of this PEPS Units Certificate hereby irrevocably
exercises the option to effect Early Settlement in accordance with the terms of
the Purchase Contract Agreement with respect to the Purchase Contracts
underlying the number of PEPS Units evidenced by this PEPS Units Certificate
specified below. The option to effect Early Settlement may be exercised only
with respect to Purchase Contracts underlying PEPS Units with an aggregate
Stated Amount equal to $1,000 or an integral multiple thereof; provided,
however, that if a Tax Event Redemption or a Successful Initial Remarketing has
occurred and the Treasury Portfolio has become a component of the PEPS Units,
Holders may not early settle PEPS Units. 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 PEPS Units Certificate representing any PEPS Units
evidenced hereby as to which Early Settlement of the related Purchase Contracts
is not effected, to the undersigned at the address indicated below unless a
different name and address have been indicated below. Pledged Preferred
Securities or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, deliverable upon such Early Settlement will be
transferred in accordance with the transfer instructions set forth below. If
shares are to be registered in the name of a Person other than the undersigned,
the undersigned will pay any transfer tax payable incident thereto.
Dated:
--------------------- --------------------------------
Signature
Signature Guarantee:
-----------------------------------
A-17
106
Number of Securities evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
If shares of Common Stock or PEPS REGISTERED HOLDER
Units Certificates are to be registered
in the name of and delivered to and
Pledged Preferred Securities, or the
Applicable Ownership Interest of the
Treasury Portfolio, as the case may be,
are to be transferred to a Person other
than the Holder, please print such
Person's name and address:
Please print name and address of
Registered Holder:
------------------------------
------------------------------ Name
Name
------------------------------
------------------------------ Address
Address
------------------------------
------------------------------ ------------------------------
------------------------------ ------------------------------
------------------------------
Social Security or other
Taxpayer Identification
Number, if any ------------------------------
A-18
107
Transfer Instructions for Pledged Preferred Securities or the Applicable
Ownership Interest of the Treasury Portfolio, as the case may be, transferable
upon Early Settlement or a Termination Event:
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A-19
108
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have been made:
==============================================================================================
Number of PEPS
Amount of Amount of Units evidenced Signature of
increase in decrease in by this Global authorized
Number of PEPS Number of PEPS Certificate officer of
Units evidenced Units evidenced following such Trustee or
by the Global by the Global decrease or Securities
Date Certificate Certificate increase Custodian
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X-00
000
XXXXXXX X
FACE OF TREASURY PEPS CERTIFICATE
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"),
OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR
CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS
CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
No. Cusip No. 00000X000
Number of PEPS Units
PPL CORPORATION
PPL Capital Funding TRUST I
TREASURY PEPS UNITS
This Treasury PEPS Units Certificate certifies that Cede & Co. is the
registered Holder of the number of Treasury PEPS Units set forth above. Each
Treasury PEPS Unit consists of (i) a 1/40 undivided beneficial ownership
interest of a Treasury Security having a principal amount at maturity equal to
$1,000, subject to the Pledge of such Treasury Security by such Holder pursuant
to the Pledge Agreement, and (ii) the rights and obligations of the Holder under
one Purchase Contract with PPL Corporation, a Delaware corporation (the
"COMPANY"). All capitalized terms used herein which are
110
defined in the Purchase Contract Agreement (as defined on the reverse hereof)
have the meaning set forth therein.
Pursuant to the Pledge Agreement, the Treasury Securities constituting
part of each Treasury PEPS Unit evidenced hereby have been pledged to the
Collateral Agent, for the benefit of the Company, to secure the obligations of
the Holder under the Purchase Contract comprising part of such Treasury PEPS
Unit. Each Purchase Contract evidenced hereby obligates the Holder of this
Treasury PEPS Units Certificate to purchase, and the Company, to sell, on May
18, 2004, at a price equal to $25 (the "STATED AMOUNT"), a number of shares of
Common Stock, $0.01 par value ("COMMON STOCK"), of the Company, equal to the
Settlement Rate, unless prior to or on the Purchase Contract Settlement Date
there shall have occurred a Termination Event or an Early Settlement with
respect to the Treasury PEPS Unit of which such Purchase Contract is a part, all
as provided in the Purchase Contract Agreement and more fully described on the
reverse hereof. The purchase price (the "PURCHASE PRICE") for the shares of
Common Stock purchased pursuant to each Purchase Contract evidenced hereby, if
not paid earlier, shall be paid on the Purchase Contract Settlement Date by
application of the proceeds from the Treasury Securities at maturity pledged to
secure the obligations of the Holder under such Purchase Contract of the
Treasury PEPS Unit of which such Purchase Contract is a part.
The Company shall pay on each Payment Date in respect of each Purchase
Contract forming part of a Treasury PEPS Unit evidenced hereby an amount (the
"Contract Adjustment Payments") equal to 0.46% per annum of the Stated Amount,
computed on the basis of a 360-day year of twelve 30 day months. Such Contract
Adjustment Payments, if any, shall be payable to the Person in whose name this
Treasury PEPS Units Certificate (or a Predecessor Treasury PEPS Units
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 Corporate
Trust Office of the Purchase Contract Agent and at the New York Office or, at
the option of the Company, by check mailed to the address of the Person entitled
thereto as such address appears on the Securities Register or by wire transfer
to the account designated by such Person by prior written notice.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Purchase Contract Agent by manual signature, this Treasury PEPS Units
Certificate shall not be entitled to any benefit under the Pledge Agreement or
the Purchase Contract Agreement or be valid or obligatory for any purpose.
B-2
111
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
PPL CORPORATION
By:
-------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the Purchase
Contracts)
By: THE CHASE MANHATTAN BANK, not
individually but solely as
Attorney-in-Fact of such Holder
By:
-------------------------
Name:
Title:
DATED:
B-3
112
CERTIFICATE OF AUTHENTICATION OF
PURCHASE CONTRACT AGENT
This is one of the Treasury PEPS Units referred to in the
within-mentioned Purchase Contract Agreement.
By: THE CHASE MANHATTAN BANK, as
Purchase Contract Agent
By:
---------------------------
Authorized Officer
B-4
113
(REVERSE OF TREASURY PEPS UNITS CERTIFICATE)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of May 9, 2001 (as may be supplemented from time to
time, the "PURCHASE CONTRACT AGREEMENT") between the Company and The Chase
Manhattan Bank, as Purchase Contract Agent (including its successors thereunder,
herein called the "PURCHASE CONTRACT AGENT"), to which the Purchase Contract
Agreement and supplemental agreements thereto reference is hereby made for a
description of the respective rights, limitations of rights, obligations, duties
and immunities thereunder of the Purchase Contract Agent, the Company and the
Holders and of the terms upon which the Treasury PEPS Units Certificates are,
and are to be, executed and delivered.
Unless a Cash Settlement or an Early Settlement has occurred, each
Purchase Contract evidenced hereby obligates the Holder of this Treasury PEPS
Units Certificate to purchase, and the Company to sell, on the Purchase Contract
Settlement Date at a price equal to the Stated Amount (the "PURCHASE PRICE") a
number of shares of Common Stock equal to the Settlement Rate, unless prior to
the Purchase Contract Settlement Date, there shall have occurred a Termination
Event with respect to the Security of which such Purchase Contract is a part or
an Early Settlement shall have occurred. The "SETTLEMENT RATE" is equal to:
(1) if the Applicable Market Value (as defined below) is
greater than or equal to $65.03 (the "THRESHOLD APPRECIATION PRICE"),
0.3845 shares of Common Stock per Purchase Contract;
(2) if the Applicable Market Value is less than the
Threshold Appreciation Price but greater than $53.30 (the "REFERENCE
PRICE"), the number of shares of Common Stock per Purchase Contract
having a value, based on the Applicable Market Value, equal to $25; and
(3) if the Applicable Market Value is less than or equal to
the Reference Price, then 0.4690 shares of Common Stock per Purchase
Contract,
in each case subject to adjustment as provided in the Purchase Contract
Agreement (and in each case rounded upward or downward to the nearest 1/10,000th
of a share).
No fractional shares of Common Stock will be issued upon settlement of
Purchase Contracts, as provided in Section 5.09 of the Purchase Contract
Agreement.
Each Purchase Contract evidenced hereby, which is settled either through
Early Settlement or Cash Settlement, shall obligate the Holder of the related
Treasury PEPS Unit to purchase at the Purchase Price for cash, and the Company
to sell, a number of shares of Common Stock equal to the Early Settlement Rate
or the Settlement Rate, as applicable.
B-5
114
The "APPLICABLE MARKET VALUE" means the average of the Closing Prices
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date.
The "CLOSING PRICE" per share of Common Stock on any date of
determination means the:
(1) closing sale price (or, if no closing price is reported,
the last reported sale price) per share on the New York Stock Exchange,
Inc. (the "NYSE") on such date;
(2) if the Common Stock is not listed for trading on the
NYSE on any such date, the closing sale price per share as reported in
the composite transactions for the principal United States securities
exchange on which the Common Stock is so listed;
(3) if the Common Stock is not so listed on a United States
national or regional securities exchange, the closing sale price per
share as reported by The NASDAQ Stock Market, Inc.;
(4) if the Common Stock is not so reported, the last quoted
bid price for the Common Stock in the over-the-counter market as
reported by the National Quotation Bureau or similar organization; or
(5) if such bid price is not available, the average of the
mid-point of the last bid and ask prices of the Common Stock on such
date from at least three nationally recognized independent investment
banking firms retained for this purpose by the Company.
A "TRADING DAY" means a day on which the Common Stock (1) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (2) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Treasury PEPS Unit shall pay the Purchase Price for the shares of
the Common Stock purchased pursuant to each Purchase Contract evidenced hereby
either by effecting a Cash Settlement or an Early Settlement of each such
Purchase Contract or by applying a principal amount of the Pledged Treasury
Securities underlying such Holder's Treasury PEPS Unit equal to the Stated
Amount of such Purchase Contract to the purchase of the Common Stock. A Holder
of Treasury PEPS Unit who does not effect, prior to 5:00 p.m. (New York City
time) on the second Business Day immediately preceding the Purchase Contract
Settlement Date, an Early Settlement, shall pay the Purchase Price for the
shares of Common Stock to be issued under the related Purchase Contract from the
proceeds of the Pledged Treasury Securities.
B-6
115
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment of the aggregate purchase price for
the shares of Common Stock to be purchased thereunder in the manner herein set
forth.
Each Purchase Contract evidenced hereby and all obligations and rights
of the Company and the Holder thereunder shall terminate if a Termination Event
shall occur. Upon the occurrence of a Termination Event, the Company shall give
written notice to the Purchase Contract Agent and to the Holders, at their
addresses as they appear in the Treasury PEPS Units Register. Upon and after the
occurrence of a Termination Event, the Collateral Agent shall release the
Pledged Treasury Securities (as defined in the Pledge Agreement) forming a part
of each Treasury PEPS Unit. A Treasury PEPS Unit shall thereafter represent the
right to receive the interest in the Treasury Security forming a part of such
Treasury PEPS Unit, in accordance with the terms of the Purchase Contract
Agreement and the Pledge Agreement.
The Treasury PEPS Units Certificates are issuable only in registered
form and only in denominations of a single Treasury PEPS Unit and any integral
multiple thereof. The transfer of any Treasury PEPS Certificate will be
registered and Treasury PEPS Certificates may be exchanged as provided in the
Purchase Contract Agreement. The Treasury PEPS Registrar may require a Holder,
among other things, to furnish appropriate endorsements and transfer documents
permitted by the Purchase Contract Agreement. No service charge shall be
required for any such registration of transfer or exchange, but the Company and
the Purchase Contract Agent may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith. A Holder who
elects to substitute Preferred Securities or Subordinated Notes, as the case may
be, for Treasury Securities, thereby recreating PEPS Units, shall be responsible
for any fees or expenses associated therewith. Except as provided in the
Purchase Contract Agreement, for so long as the Purchase Contract underlying a
Treasury PEPS Unit remains in effect, such Treasury PEPS Unit shall not be
separable into its constituent parts, and the rights and obligations of the
Holder of such Treasury PEPS Unit in respect of the Treasury Security and the
Purchase Contract constituting such Treasury PEPS Unit may be transferred and
exchanged only as a Treasury PEPS Unit.
A Holder of Treasury PEPS Units may recreate PEPS Units by delivering to
the Collateral Agent, Preferred Securities or Subordinated Notes with a
liquidation amount, in the case of such Preferred Securities or with a principal
amount in the case of such Subordinated Notes, equal to the aggregate principal
amount at maturity of the Pledged Treasury Securities in exchange for the
release of such Pledged Treasury Securities in accordance with the terms of the
Purchase Contract Agreement and the Pledge Agreement. From and after such
substitution, the Holder's Security shall be referred to as a "PEPS UNIT". Any
such creation of PEPS Units may be effected in multiples of 40 Treasury PEPS
Units for 40 PEPS Units; provided, however, that if a Tax Event Redemption or a
Successful Initial Remarketing has occurred and the Treasury Portfolio
B-7
116
has become a component of the PEPS Units, a Holder may not make such
substitution. Such substitution may cause the equivalent aggregate Stated Amount
of this Certificate to be increased or decreased; provided, however, the
equivalent aggregate Stated Amount outstanding under this Treasury Units
Certificate shall not exceed $500,000,000. All such adjustments to the
equivalent aggregate Stated Amount of this PEPS Units Certificate shall be duly
recorded by placing an appropriate notation on the Schedule attached hereto.
A Holder of PEPS Units may recreate Treasury PEPS Units by delivering to
the Collateral Agent Treasury Securities in an aggregate principal amount equal
to the aggregate liquidation amount of the Pledged Preferred Securities or the
aggregate principal amount at maturity of the Pledged Subordinated Notes, as the
case may be, in accordance with the terms of the Purchase Contract Agreement and
the Pledge Agreement. Any such recreation of Treasury PEPS Units may be effected
only in multiples of 40 PEPS Units for 40 Treasury PEPS Units; provided,
however, if a Tax Event Redemption or a Successful Initial Remarketing has
occurred and the Treasury Portfolio has become a component of the PEPS Unit, a
Holder may not make such Collateral Substitution.
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 Treasury PEPS Units 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 Corporate Trust
Office of the Purchase Contract Agent and the New York Office 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 Securities Register.
The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay Contract Adjustment
Payments, if any, and the rights and obligations of Holders to purchase Common
Stock, shall immediately and automatically terminate, without the necessity of
any notice or action by any Holder, the Purchase Contract Agent or the Company,
if, on or prior to the Purchase Contract Settlement Date, a Termination Event
shall have occurred. Upon the occurrence of a Termination Event, the Company
shall promptly but in no event later than two Business Days thereafter give
written notice to the Purchase Contract Agent, the Collateral Agent and the
Holders, at their addresses as they appear in the Security Register. Upon and
after the occurrence of a Termination Event, the Collateral Agent shall release
the Treasury Securities from the Pledge in accordance with the provisions of the
Pledge Agreement. A Treasury PEPS Unit shall thereafter represent the right to
receive the interest in the Treasury Security forming a part of such Treasury
PEPS Unit, in accordance with the terms of the Purchase Contract Agreement and
the Pledge Agreement.
B-8
117
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
underlying Securities may be settled early ("EARLY SETTLEMENT") as provided in
the Purchase Contract Agreement. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contracts evidenced by this Treasury
PEPS Unit, the Holder of this Treasury PEPS Units Certificate shall deliver to
the Purchase Contract Agent at the Corporate Trust Office an Election to Settle
Early form set forth below and any other documents requested by the Purchase
Contract Agent duly completed and accompanied by payment in the form of
immediately available funds payable to the order of the Company in an amount
(the "EARLY SETTLEMENT AMOUNT") equal to (i) the product of (A) $25 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 on
such Payment Date with respect to such Purchase Contracts.
Upon Early Settlement of Purchase Contracts by a Holder of the related
Securities, the Pledged Treasury Securities underlying such Securities shall be
released from the Pledge as provided in the Pledge Agreement and the Holder
shall be entitled to receive a number of shares of Common Stock on account of
each Purchase Contract forming part of a Treasury PEPS Unit as to which Early
Settlement is effected equal to 0.3845 shares of Common Stock per Purchase
Contract (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 future Contract Adjustment Payments, except to
the extent that the Early Settlement Date is after the close of business on a
Record Date and prior to the opening of business on the corresponding Payment
Date. The Early Settlement Rate shall be adjusted in the same manner and at the
same time as the Settlement Rate is adjusted as provided in the Purchase
Contract Agreement.
Upon registration of transfer of this Treasury PEPS Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Purchase Contract Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Treasury PEPS Units Certificate. The Company covenants and
agrees, and the Holder, by its acceptance hereof, likewise covenants and agrees,
to be bound by the provisions of this paragraph.
The Holder of this Treasury PEPS Units Certificate, by its acceptance
hereof, authorizes the Purchase Contract Agent to enter into and perform the
related Purchase Contracts forming part of the Treasury PEPS Units evidenced
hereby on its behalf as its attorney-in-fact, expressly withholds any consent to
the assumption (i.e., affirmance) of the Purchase Contracts by the Company or
its trustee in the event that the Company becomes the subject of a case under
the Bankruptcy Code, agrees to be bound by the
B-9
118
terms and provisions thereof, covenants and agrees to perform its obligations
under such Purchase Contracts, consents to the provisions of the Purchase
Contract Agreement, authorizes the Purchase Contract Agent to enter into and
perform the Purchase Contract Agreement and the Pledge Agreement on its behalf
as its attorney-in-fact, and consents to the Pledge of the Treasury Securities
underlying this Treasury PEPS Units Certificate pursuant to the Pledge
Agreement. The Holder further covenants and agrees, that, to the extent and in
the manner provided in the Purchase Contract Agreement and the Pledge Agreement,
but subject to the terms thereof, payments in respect to the aggregate principal
amount of the Pledged Treasury Securities on the Purchase Contract Settlement
Date shall be paid by the Collateral Agent to the Company in satisfaction of
such Holder's obligations under such Purchase Contract and such Holder shall
acquire no right, title or interest in such payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.
The Company, the Purchase Contract Agent and its Affiliates and any
agent of the Company or the Purchase Contract Agent may treat the Person in
whose name this Treasury PEPS Units Certificate is registered as the owner of
the Treasury PEPS Units evidenced hereby for the purpose of receiving payments
of interest on the Treasury Securities, receiving payments of Contract
Adjustment Payments, if any, performance of the Purchase Contracts and for all
other purposes whatsoever, whether or not any payments in respect thereof be
overdue and notwithstanding any notice to the contrary, and neither the Company,
the Purchase Contract Agent nor any such agent shall be affected by notice to
the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection at
the Corporate Trust Office of the Purchase Contract Agent.
B-10
119
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM: as tenants in common
UNIF GIFT MIN ACT: Custodian
------------------- ----------------------
(cust) (minor)
Under Uniform Gifts to Minors Act of
--------------
----------------------------------------------------
TENANT: as tenants by the entireties
JT TEN: as joint tenants with right of survivorship and not
as tenants in common
Additional abbreviations may also be used though not in the above list.
-----------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
-------------------------------------------------------------------------------
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
-------------------------------------------------------------------------------
(Please Print or Type Name and Address Including Postal Zip Code of
Assignee)
the within PEPS Units Certificates and all rights thereunder, hereby irrevocably
constituting and appointing attorney __________________, to transfer said PEPS
Units Certificates on the books of PPL Corporation and PPL Capital Funding Trust
I 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 PEPS Units
Certificates in every particular, without
alteration or enlargement or any change
whatsoever.
Signature Guarantee:
-------------------------------
X-00
000
XXXXXXXXXX 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 PEPS Units evidenced by
this PEPS Units Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional share, to the undersigned at
the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated:
--------------------- -------------------------------
Signature
Signature Guarantee:______________
(if assigned to another person)
If shares are to be registered in the name of
and delivered to a Person other than the REGISTERED HOLDER
Holder, please (i) print such Person's name
and address and (ii) provide a guarantee of Please print name and address of Registered
your signature: Holder:
------------------------------ ------------------------------
Name Name
------------------------------ ------------------------------
Address Address
------------------------------ ------------------------------
------------------------------ ------------------------------
------------------------------ ------------------------------
Social Security or other
Taxpayer Identification
Number, if any
------------------------------
B-12
121
ELECTION TO SETTLE EARLY
The undersigned Holder of this Treasury PEPS Units Certificate
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Treasury PEPS Units evidenced by this
Treasury PEPS Units Certificate specified below. The option to effect Early
Settlement may be exercised only with respect to Purchase Contracts underlying
Treasury PEPS with an aggregate Stated Amount equal to $1,000 or an integral
multiple thereof. The undersigned Holder directs that a certificate for shares
of Common Stock deliverable upon such Early Settlement be registered in the name
of, and delivered, together with a check in payment for any fractional share and
any Treasury PEPS Units Certificate representing any Treasury PEPS Units
evidenced hereby as to which Early Settlement of the related Purchase Contracts
is not effected, to the undersigned at the address indicated below unless a
different name and address have been indicated below. Pledged Treasury
Securities deliverable upon such Early Settlement will be transferred in
accordance with the transfer instructions set forth below. If shares are to be
registered in the name of a Person other than the undersigned, the undersigned
will pay any transfer tax payable incident thereto.
Dated:
----------------------- --------------------------------
Signature
Signature Guarantee:
------------------------
B-13
122
Number of Securities evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
If shares of Common Stock of Treasury PEPS REGISTERED HOLDER
Units Certificates are to be registered in
the name of and delivered to and Pledged
Treasury Securities are to be transferred to
a Person other than the Holder, please print
such Person's name and address:
Please print name and address of Registered
Holder:
------------------------------ ------------------------------
Name Name
------------------------------ ------------------------------
Address Address
------------------------------ ------------------------------
------------------------------ ------------------------------
------------------------------ ------------------------------
Social Security or other
Taxpayer Identification
Number, if any
------------------------------
B-14
123
Transfer Instructions for Pledged Preferred Securities or the Applicable
Ownership Interest of the Treasury Portfolio, as the case may be, transferable
upon Early Settlement or a Termination Event:
------------------------------------------------------------------------
------------------------------------------------------------------------
------------------------------------------------------------------------
C-15
124
[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:
=================================================================================================
Amount of
Amount of increase decrease in Number of Treasury Signature of
in Number of Number of PEPS Units evidenced authorized
Treasury PEPS Treasury PEPS by this Global officer of
Units evidenced by Units evidenced Certificate Trustee or
the Global by the Global following such Securities
Date Certificate Certificate decrease or increase Custodian
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C-16
125
EXHIBIT C
INSTRUCTION TO PURCHASE CONTRACT AGENT
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Institutional Trust Services
Re: [_______ PEPS Units] [_______ Treasury PEPS Units] of PPL
Corporation, a Pennsylvania corporation (the "COMPANY"), and PPL Capital Funding
Trust I.
The undersigned Holder hereby notifies you that it has delivered to The
Bank of New York, as Securities Intermediary, for credit to the Collateral
Account, $______ aggregate [principal] [liquidation] amount of [Preferred
Securities] [Subordinated Notes] [Treasury Securities] or security entitlements
with respect thereto in exchange for the [Pledged Preferred Securities] [Pledged
Subordinated Notes] [Pledged Treasury Securities] held in the Collateral
Account, in accordance with the Pledge Agreement, dated as of May 9, 2001 (the
"PLEDGE AGREEMENT"; unless otherwise defined herein, terms defined in the Pledge
Agreement are used herein as defined therein), between you, the Company, the
Collateral Agent and the Securities Intermediary. The undersigned Holder has
paid all applicable fees relating to such exchange. The undersigned Holder
hereby instructs you to instruct the Collateral Agent to release to you on
behalf of the undersigned Holder the [Pledged Preferred Securities] [Pledged
Subordinated Notes] [Pledged Treasury Securities] related to such [PEPS Units]
[Treasury PEPS Units].
Dated:
----------------------- --------------------------------
Signature
Signature Guarantee:
------------------------
--------------------------------
TRADES Account No. of Holder
----------------------------
------------------------------
DTC Account No. of Holder
C-1
126
Please print name and address of Registered Holder:
--------------------------- ---------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
Address
---------------------------
---------------------------
---------------------------
C-2
127
EXHIBIT D
NOTICE FROM PURCHASE CONTRACT AGENT
TO HOLDERS
(Transfer of Collateral upon Occurrence of a Termination Event)
[HOLDER]
----------------------------
----------------------------
Attention:
Telecopy:
-------------------
Re: [__________ PEPS Units] [______ Treasury PEPS Units] of PPL
Corporation, a Pennsylvania corporation (the "COMPANY") and PPL
Capital Funding Trust I
Please refer to the Purchase Contract Agreement, dated as of May 9, 2001
(the "PURCHASE CONTRACT AGREEMENT"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and the undersigned, as Purchase Contract Agent and as
attorney-in-fact for the holders of PEPS Units and Treasury PEPS Units from time
to time.
We hereby notify you that a Termination Event has occurred and that [the
Subordinated Notes][the Treasury Securities] [Applicable Ownership Interest in
the Treasury Portfolio] underlying your ownership interest in _____ [PEPS Units]
[Treasury PEPS Units] have been released and are being held by us for your
account pending receipt of transfer instructions with respect to such
[Subordinated Notes][Treasury Securities] [Applicable Ownership Interest in the
Treasury Portfolio] (the "RELEASED SECURITIES").
Pursuant to Section 3.15 of the Purchase Contract Agreement, we hereby
request written transfer instructions with respect to the Released Securities.
Upon receipt of your instructions and upon transfer to us of your [PEPS
Units][Treasury PEPS Units] effected through book-entry or by delivery to us of
your [PEPS Units Certificate][Treasury PEPS Units Certificate], we shall
transfer the Released Securities by book-entry transfer or other appropriate
procedures, in accordance with your instructions. In the event you fail to
effect such transfer or delivery, the Released Securities and any distributions
thereon, shall be held in our name, or a nominee in trust for your benefit,
until such time as such [PEPS Units][Treasury PEPS Units] are transferred or
your [PEPS Units Certificate] [Treasury PEPS Units Certificate] is surrendered
or satisfactory evidence is provided that such [PEPS Units Certificate][Treasury
PEPS Units Certificate] has been destroyed, lost or stolen,
D-1
128
together with any indemnification that we or the Company may require.
Date: By: THE CHASE MANHATTAN BANK, as
Purchase Contract
Agent
------------------------------
Name:
Title: Authorized Signatory
D-2
129
EXHIBIT E
NOTICE TO SETTLE BY CASH
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Institutional Trust Services
Re: [_______ PEPS Units] [_______ Treasury PEPS Units] of PPL Corporation, a
Pennsylvania corporation (the "COMPANY") and PPL Capital Funding Trust I
The undersigned Holder hereby irrevocably notifies you in accordance
with Section of the Purchase Contract Agreement, dated as of May __, 2001 (the
"PURCHASE CONTRACT AGREEMENT"; unless otherwise defined herein, terms defined in
the Purchase Contract Agreement are used herein as defined therein), between the
Company and you, as Purchase Contract Agent and as Attorney-in-Fact for the
Holders of the Purchase Contracts, that such Holder has elected to pay to the
Securities Intermediary for deposit in the Collateral Account, prior to or on
11:00 a.m. (New York City time) on the fourth Business Day immediately preceding
the Purchase Contract Settlement Date (in lawful money of the United States wire
transfer, in immediately available funds), $______ as the Purchase Price for the
shares of Common Stock issuable to such Holder by the Company under the related
Purchase Contracts on the Purchase Contract Settlement Date. The undersigned
Holder hereby instructs you to notify promptly the Collateral Agent of the
undersigned Holders' election to make such cash settlement with respect to the
Purchase Contracts related to such Holder's [PEPS Units] [Treasury PEPS Units].
Dated:
----------------------- --------------------------------
Signature
Signature Guarantee:
-----------------------------
Please print name and address of Registered Holder:
E-1
130
EXHIBIT F
NOTICE FROM PURCHASE CONTRACT AGENT
TO REMARKETING AGENT, COLLATERAL AGENT
AND INDENTURE TRUSTEE AND THE COMPANY
(Settlement of Purchase Contract through Remarketing)
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:
Telecopy:
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention:
Telecopy:
PPL Corporation
Xxx Xxxxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000
Attention: Treasurer
Telecopy: (000) 000-0000
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Institutional Trust Services
Telecopy: (000) 000-0000
Re: __________ PEPS Units of PPL Corporation, a Pennsylvania
corporation (the "COMPANY") and PPL Capital Funding Trust I, a
Delaware statutory business trust
Please refer to the Purchase Contract Agreement, dated as of May 9, 2001
(the "PURCHASE CONTRACT AGREEMENT"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and the undersigned, as Purchase Contract Agent and as
attorney-in-fact for the Holders of PEPS Units from time to time.
In accordance with Section 5.03(b) of the Purchase Contract Agreement
and, based on instructions received from Holders of PEPS Units as of 11:00 a.m.
(New York City time), on the fifth Business Day preceding the Purchase Contract
Settlement Date,
F-1
131
we hereby notify you that ______ [Preferred Securities] [Subordinated Notes] are
to be tendered for purchase in the Remarketing.
Date: By: THE CHASE MANHATTAN
BANK, as Purchase Contract Agent
------------------------------
Name:
Title: Authorized Officer
F-2
