SUBSCRIPTION AGREEMENT
THIS SUBSCRIPTION AGREEMENT is entered into as of the 27th day of
January 1999, between Xxxx X. Efron (the "Trustee"), not in his individual
capacity, but solely as trustee of Xxxxx Xxxxxx Automatic Common Exchange
Security Trust II, a trust organized and existing under the laws of New York
(the "Trust"), and Xxxxxxx, Xxxxx & Co. or one of its affiliates (the
"Purchaser").
THE PARTIES HEREBY AGREE AS FOLLOWS:
1. PURCHASE AND SALE OF THE SECURITY
1.1 SALE AND ISSUANCE OF UNITS. Subject to the terms and conditions of
this Agreement, the Trustee agrees to sell to the Purchaser, and the Purchaser
agrees to purchase from the Trustee, one Trust Automatic Common Exchange
Security, representing an undivided beneficial interest in the Trust (the
"Security") at an aggregate purchase price of $100.
1.2 CLOSING. The purchase and sale of the Security shall take place at
the offices of Xxxxxxxx & Xxxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx at 9:30
a.m., on January 28, 1999, or at such other time (the "Closing Date") and place
as the Trustee and the Purchaser mutually agree upon. At or after the Closing,
the Trustee shall deliver to the Purchaser a certificate representing the
Security, registered in the name of the Purchaser or its nominee. Payment for
the Security shall be made on the Closing Date by the Purchaser by bank wire
transfers or by delivery of certified or official bank checks, in either case in
immediately available funds, of an amount equal to the purchase price of the
Security purchased by the Purchaser.
2. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PURCHASER. The
Purchaser hereby represents and warrants to, and covenants for the benefit of,
the Trust that:
2.1 PURCHASE ENTIRELY FOR OWN ACCOUNT. This Agreement is made by the
Trustee with the Purchaser in reliance upon the Purchaser's representation to
the Trustee, which by the Purchaser's execution of this Agreement the Purchaser
hereby confirms, that the Security is being acquired for investment for the
Purchaser's own account, and not as a nominee or agent and not with a view to
the resale
or distribution by the Purchaser of the Security, and that the Purchaser has no
present intention of selling, granting any participation in, or otherwise
distributing the Security, in either case in violation of any securities
registration requirement under applicable law, but subject nevertheless, to any
requirement of law that the disposition of its property shall at all times be
within its control. By executing this Agreement, the Purchaser further
represents that the Purchaser does not have any contract, undertaking, agreement
or arrangement with any person to sell, transfer or grant participation to such
person or to any third person, with respect to the Security.
2.2 INVESTMENT EXPERIENCE. The Purchaser acknowledges that it can bear
the economic risk of the investment for an indefinite period of time and has
such knowledge and experience in financial and business matters (and
particularly in the business in which the Trust operates) as to be capable of
evaluating the merits and risks of the investment in the Security. The Purchaser
is an "accredited investor" as defined in Rule 501(a) of Regulation D under the
Securities Act of 1933, as amended (the "Act").
2.3 RESTRICTED SECURITIES. The Purchaser understands that the Security
is characterized as a "restricted security" under the United States securities
laws inasmuch as it is being acquired from the Trustee in a transaction not
involving a public offering and that under such laws and applicable regulations
such Security may be resold without registration under the Act only in certain
circumstances. In this connection, the Purchaser represents that it understands
the resale limitations imposed by the Act and is generally familiar with the
existing resale limitations imposed by Rule 144.
2.4 FURTHER LIMITATIONS ON DISPOSITION. The Purchaser further agrees
not to make any disposition directly or indirectly of all or any portion of the
Security unless and until:
(a) There is then in effect a registration statement under the Act
covering such proposed disposition and such disposition is made in accordance
with such registration statement;
(b) The Purchaser shall have furnished the Trustee with an opinion of
counsel, reasonably satisfactory
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to the Trustee, that such disposition will not require registration of such
Securities under the Act; or
(c) Notwithstanding the provisions of subsections (a) and (b) above, no
such registration statement or opinion of counsel shall be necessary for a
transfer by the Purchaser to any affiliate of the Purchaser, if the transferee
agrees in writing to be subject to the terms hereof to the same extent as if it
were the original Purchaser hereunder.
2.5 LEGENDS. It is understood that the certificate evidencing the
Security may bear either or both of the following legends:
(a) "These securities have not been registered under the
Securities Act of 1933. They may not be sold, offered for sale, pledged
or hypothecated in the absence of a registration statement in effect
with respect to the securities under such Act or an opinion of counsel
reasonably satisfactory to the Trustee of Xxxxx Xxxxxx Automatic Common
Exchange Security Trust that such registration is not required."
(b) Any legend required by the laws of any other applicable
jurisdiction.
The Purchaser and the Trustee agree that the legend contained in the
paragraph (a) above shall be removed at a holder's request when they are no
longer necessary to ensure compliance with federal securities laws.
2.6 AMENDMENT TO TRUST AGREEMENT; SPLIT OF THE SECURITIES. The
Purchaser consents to (a) the execution and delivery by the Trustee and Xxxxxxx,
Sachs & Co., as sponsor of the Trust, of an Amended and Restated Trust Agreement
in the form attached hereto and (b) the split of the Purchaser's Security.
Subsequent to the determination of the public offering price per Security and
related underwriting discount for the Securities to be sold to the Underwriters
(as defined in the aforementioned Amended and Restated Trust Agreement) but
prior to the sale of the Securities to the Underwriters, the Security purchased
hereby shall be split into a greater number of Securities so that immediately
following such split the value of each Security held by the Purchaser will equal
the aforesaid public offering price less the related underwriting discount.
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2.7 COUNTERPARTS. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
TRUSTEE
/s/ Xxxx X. Efron
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Xxxx X. Efron
as Trustee
XXXXXXX, XXXXX & CO.
By: /s/ Xxxxxxx, Sachs & Co.
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Xxxxxxx, Xxxxx & Co.
as Purchaser
