PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of March, 1998 (this "Agreement"), among
Xxxxxxxxx-Xxxx Company, a New Jersey corporation (the "Company"), The Chase
Manhattan Bank, a New York banking corporation, not individually but solely
as collateral agent (in such capacity, together with its successors in such
capacity, the "Collateral Agent") and in its capacity as a "securities
intermediary" as defined in Section 8-102(a)(14) of the Code (as defined
herein) (in such capacity, together with its successors in such capacity, the
"Securities Intermediary"), and The First National Bank of Chicago, not
individually but solely as purchase contract agent and as attorney-in-fact of
the Holders (as defined in the Purchase Contract Agreement) from time to time
of the Securities (as hereinafter defined) (in such capacity, together with
its successors in such capacity, the "Purchase Contract Agent") under the
Purchase Contract Agreement (as hereinafter defined).
RECITALS
The Company and the Purchase Contract Agent are parties to the
Purchase Contract Agreement, dated as of the date hereof (as modified and
supplemented and in effect from time to time, the "Purchase Contract
Agreement"), pursuant to which there may be issued up to FELINE PRIDES
and % Trust Originated Preferred Securities (the "Preferred
Securities" and, together with the FELINE PRIDES, the "Securities").
The FELINE PRIDES will initially consist of (A) 35,000,000 units
(referred to as "Income PRIDES") with a Stated Amount, per Income PRIDES, of
$10 (the "Stated Amount") and (B) at least 3,500,000 units (referred to as
"Growth PRIDES") with a face amount, per Growth PRIDES, equal to the Stated
Amount. Each Income PRIDES will initially consist of a unit comprised of (a)
a stock purchase contract (a "Purchase Contract") under which (i) the holder
will purchase from the Company on , 2001 (the "Purchase Contract
Settlement Date"), for an amount of cash equal to the Stated Amount, a number
of newly issued shares of common stock, $2.00 par value per share (the
"Common Stock"), of the Company equal to the Settlement Rate and (ii) the
Company will pay the holder Contract Adjustment Payments at the rate of
% of the Stated Amount per annum and (b) either beneficial ownership of a
Trust Preferred Security or upon the occurrence of a Tax Event Redemption the
Applicable Ownership Interest of the Treasury Portfolio. Each Growth PRIDES
will initially consist of a unit comprised of (a) a Purchase Contract under
which (i) the holder will purchase from the Company on the Purchase Contract
Settlement Date, for an amount in cash equal to the Stated Amount, a number
of newly issued shares of Common Stock of the Company, equal to the
Settlement Rate, and (ii) the Company will pay the holder Contract Adjustment
Payments, at the rate of % of the Stated Amount per annum, and (b) a
1/100 undivided beneficial interest in a % zero-coupon U.S. Treasury
Security (CUSIP No. ) having a principal amount equal to $1,000 and
maturing on , 2001 (the "Treasury Securities").
Pursuant to the terms of the Purchase Contract Agreement and the
Purchase Contracts, the Holders, from time to time, of the Securities have
irrevocably authorized the Purchase Contract Agent, as attorney-in-fact of
such Holders, among other things, to execute and deliver this Agreement on
behalf of such Holders and to grant the pledge provided hereby of the
Preferred Securities and any Treasury Securities delivered in exchange
therefor to secure each Holder's obligations under the related Purchase
Contract, as provided herein and subject to the terms hereof. Upon such
pledge, the Preferred Securities will be beneficially owned by the Holders
but will be owned of record by the Purchase Contract Agent subject to the
Pledge hereunder.
Accordingly, the Company, the Collateral Agent, the Securities
Intermediary and the Purchase Contract Agent, on its own behalf and as
attorney-in-fact of the Holders from time to time of the Securities, agree as
follows:
Section 1. Definitions. For all purposes of this Agreement,
except as otherwise expressly provided or unless the context otherwise
requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(b) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any
particular Article, Section or other subdivision;
(c) the following terms have the meanings assigned to them in the
Purchase Contract Agreement: (i) Act, (ii) Agent, (iii) Board
Resolution, (iv) Cash Settlement, (v) Certificate, (vi) Common Stock,
(vii) Contract Adjustment Payments, (viii) Debentures, (ix) Early
Settlement, (x) Early Settlement Amount, (xi) Early Settlement Date,
(xii) Failed Remarketing, (xiii) Holder, (xiv) Opinion of Counsel, (xv)
Outstanding Securities, (xvi) Purchase Agreement, (xvii) Purchase
Contract, (xviii) Purchase Contract Settlement Date, (xix) Purchase
Price, (xx) Remarketing Agent, (xxi) Remarketing Agreement, (xxii)
Remarketing Underwriting Agreement, (xxiii) Settlement Rate, and (xxiv)
Termination Event; and
(d) the following terms have the meanings assigned to them in the
Declaration: (i) Applicable Ownership Interest (ii) Applicable
Principal Amount, (iii) Institutional Trustee, (iv) Investment Company
Event,(v) Primary Treasury Dealer, (vi) Quotation Agent, (vii)
Redemption Amount, (viii) Redemption Price, (ix) Tax Event, (x) Tax
Event Redemption, (xi) Tax Event Redemption Date, (xii) Treasury
Portfolio, (xiii) Treasury Portfolio Purchase Price.
"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.
"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.
"Business Day" means any day other than a Saturday, a Sunday or any
other day on which banking institutions in The City of New York (in the State
of New York) are permitted or required by any applicable law to close.
"Cash" means any coin or currency of the United States as at the
time shall be legal tender for payment of public and private debts.
"Code" has the meaning specified in Section 6.1 hereof.
"Collateral" has the meaning specified in Section 2.1 hereof.
"Collateral Account" means the trust account (number )
maintained at The Chase Manhattan Bank in the name "The First National Bank
of Chicago", as Purchase Contract Agent on behalf of the holders of certain
securities of Xxxxxxxxx-Xxxx Financing I, Collateral Account subject to the
security interest of The Chase Manhattan Bank, as Collateral Agent, for the
benefit of Xxxxxxxxx-Xxxx Company, as pledgee and any successor account.
"Collateral Agent" has the meaning specified in the first paragraph
of this instrument.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such, and
thereafter "Company" shall mean such successor.
"Debenture Trustee" means
, as trustee under the Indenture until a successor
is appointed thereunder, and thereafter means such successor trustee.
"Declaration" means the Amended and Restated Declaration of Trust,
dated as of , 1998, among the Company as sponsor, the trustees
named therein and the holders from time to time of undivided beneficial
interests in the assets of the Trust.
"Intermediary" means any entity that in the ordinary course of its
business maintains securities accounts for others and is acting in that
capacity.
"Permitted Investments" means any one of the following which shall
mature not later than the next succeeding Business Day (i) any evidence of
indebtedness with an original maturity of 365 days or less issued, or
directly and fully guaranteed or insured, by the United States of America or
any agency or instrumentality thereof (provided that the full faith and
credit of the United States of America is pledged in support thereof or such
indebtedness constitutes a general obligation of it); (ii) deposits,
certificates of deposit or acceptances with an original maturity of 365 days
or less of any institution which is a member of the Federal Reserve System
having combined capital and surplus and undivided profits of not less than
US$ 200.0 million at the time of deposit; (iii) investments with an original
maturity of 365 days or less of any Person that is fully and unconditionally
guaranteed by a bank referred to in clause (ii); (iv) repurchase agreements
and reverse repurchase agreements relating to marketable direct obligations
issued or unconditionally guaranteed by the United States Government or
issued by any agency thereof and backed by the full faith and credit of the
United States Government; (v) investments in commercial paper, other than
commercial paper issued by the Company or its affiliates, of any corporation
incorporated under the laws of the United States or any State thereof, which
commercial paper has a rating at the time of purchase at least equal to "A-1"
by Standard & Poor's Ratings Services or at least equal to "P-1" by Xxxxx'x
Investors Service, Inc.; and (vi) investments in money market funds
registered under the Investment Company Act of 1940, as amended, rated in the
highest applicable rating category by S&P or Moody's.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
"Pledge" has the meaning specified in Section 2.1 hereof.
"Pledged Preferred Securities" has the meaning specified in Section
2.1 hereof.
"Pledged Treasury Securities" has the meaning specified in Section
2.1 hereof.
"Preferred Securities" has the meaning specified in the Recitals.
"Proceeds" means all interest, dividends, cash, instruments,
securities, financial assets (as defined in Section 8-102(a)(9) of the Code)
and other property from time to time received, receivable or otherwise
distributed upon the sale, exchange, collection or disposition of the
Collateral or any proceeds thereof.
"Purchase Contract" has the meaning specified in the Recitals.
"Purchase Contract Agent" has the meaning specified in the first
paragraph of this Agreement.
"Purchase Contract Agreement" has the meaning specified in the
Recitals.
"Securities" has the meaning specified in the Recitals.
"Securities Intermediary" has the meaning specified in the first
paragraph of this Agreement.
"Security Entitlement" has the meaning set forth in Section 8-
102(a)(17) of the Code.
"Stated Amount" has the meaning specified in the Recitals.
"TRADES" means the Treasury/Reserve Automated Debt Entry System
maintained by the Federal Reserve Bank of New York pursuant to the TRADES
Regulations.
"TRADES Regulations" means the regulations of the United States
Department of the Treasury, published at 31 C.F.R. Part 357, as amended from
time to time. Unless otherwise defined herein, all terms defined in the
TRADES Regulations are used herein as therein defined.
"Transfer" means, with respect to the Collateral and in accordance
with the instructions of the Collateral Agent, the Purchase Contract Agent or
the Holder, as applicable:
(i) in the case of Collateral consisting of securities which
cannot be delivered by book-entry or which the parties agree are to be
delivered in physical form, delivery in appropriate physical form to the
recipient accompanied by any duly executed instruments of transfer,
assignments in blank, transfer tax stamps and any other documents
necessary to constitute a legally valid transfer to the recipient;
(ii) in the case of Collateral consisting of securities maintained
in book-entry form by causing a "securities intermediary" (as defined in
Section 8-102(a)(14) of the Code) to (i) credit a "securities
entitlement" (as defined in Section 8-102(a)(17) of the Code) with
respect to such securities to a "securities account" (as defined in
Section 8-501(a) of the Code) maintained by or on behalf of the
recipient and (ii) to issue a confirmation to the recipient with respect
to such credit.
"Treasury Security" means a zero-coupon U.S. Treasury Security
(Cusip Number ) which are the principal strips of the
% U.S. Treasury Securities which mature on , 2001.
"Trust" has the meaning specified in the Recitals.
"Value" with respect to any item of Collateral on any date means,
as to (i) a Preferred Security, the Stated Amount, (ii) Cash, the face amount
thereof and (iii) Treasury Securities, the aggregate principal amount thereof
at maturity.
Section 2. Pledge; Control and Perfection.
Section 2.1. The Pledge. The Holders from time to time acting
through the Purchase Contract Agent, as their attorney-in-fact, hereby pledge
and grant to the Collateral Agent, for the benefit of the Company, as
collateral security for the performance when due by such Holders of their
respective obligations under the related Purchase Contracts, a security
interest in (i) all of the right, title and interest of such Holders (a) in
the Preferred Securities constituting a part of the Securities and all
Proceeds thereof and any Treasury Securities delivered in exchange for such
Preferred Securities in accordance with Section 4 hereof, in each case that
have been Transferred to or received by the Collateral Agent and not released
by the Collateral Agent to such Holders under the provisions of this
Agreement (the "Collateral"); (b) in payments made by Holders pursuant to
Section 4.4; (c) in the Collateral Account and all securities, financial
assets and other property credited thereto and all Security Entitlements
related thereto; (d) in any Debentures delivered to the Collateral Agent upon
the occurrence of an Investment Company Event or a liquidation of the Trust
as provided in Section 6.2; (e) in the Treasury Portfolio purchased on behalf
of the Holders of Income PRIDES by the Collateral Agent upon the occurrence
of a Tax Event Redemption as provided in Section 6.2 and (f) all proceeds of
the foregoing. Prior to or concurrently with the execution and delivery of
this Agreement, the Purchase Contract Agent, on behalf of the initial Holders
of the Income PRIDES, shall cause the Preferred Securities comprising a part
of the Income PRIDES to be delivered to the Collateral Agent for the benefit
of the Company by physically delivering such securities to the Collateral
Agent endorsed in blank and the Collateral Agent delivering such securities
to the Securities Intermediary and causing the Securities Intermediary to
credit the Collateral Account with such securities and send the Collateral
Agent a confirmation of the deposit of such securities. In the event a
Holder of Income PRIDES so elects, such Holder may Transfer Treasury
Securities to the Collateral Agent for the benefit of the Company in exchange
for the release by the Collateral Agent on behalf of the Company of Preferred
Securities or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, with an aggregate stated liquidation amount
equal to the aggregate principal amount of the Treasury Securities so
Transferred, in the case of Preferred Securities, or with an appropriate
Applicable Ownership Interest (as specified in clause (A) of the definition
of such term) of the Treasury Portfolio equal to the aggregate principal
amount of the Treasury Securities so transferred, in the event that a Tax
Event Redemption has occurred, to the Purchase Contract Agent on behalf of
such Holder. Treasury Securities and the Treasury Portfolio, as applicable,
shall be Transferred to the Collateral Account maintained by the Collateral
Agent at the Securities Intermediary by book-entry transfer to the Collateral
Account in accordance with the TRADES Regulations and other applicable law
and by the notation by the Securities Intermediary on its books that a
Security Entitlement with respect to such Treasury Securities or Treasury
Portfolio, has been credited to the Collateral Account. For purposes of
perfecting the Pledge under applicable law, including, to the extent
applicable, the TRADES Regulations or the Uniform Commercial Code as adopted
and in effect in any applicable jurisdiction, the Collateral Agent shall be
the agent of the Company as provided herein. The pledge provided in this
Section 2.1 is herein referred to as the "Pledge" and the Preferred
Securities (or the Debentures that are delivered pursuant to Section 6.2
hereof) or Treasury Securities subject to the Pledge, excluding any Preferred
Securities (or the Debentures that are delivered pursuant to Section 6.2
hereof) or Treasury Securities released from the Pledge as provided in
Section 4 hereof, are hereinafter referred to as "Pledged Preferred
Securities" or the "Pledged Treasury Securities," respectively. Subject to
the Pledge and the provisions of Section 2.2 hereof, the Holders from time to
time shall have full beneficial ownership of the Collateral. Whenever
directed by the Collateral Agent acting on behalf of the Company, the
Securities Intermediary shall have the right to reregister the Preferred
Securities or any other securities held in physical form in its name.
Except as may be required in order to release Preferred Securities
in connection with a Holder's election to convert its investment from an
Income PRIDES to a Growth PRIDES, or except as otherwise required to release
securities as specified herein, neither the Collateral Agent nor the
Securities Intermediary shall relinquish physical possession of any
certificate evidencing a Preferred Security prior to the termination of this
Agreement. If it becomes necessary for the Securities Intermediary to
relinquish physical possession of a certificate in order to release a portion
of the Preferred Securities evidenced thereby from the Pledge, the Securities
Intermediary shall use its best efforts to obtain physical possession of a
replacement certificate evidencing any Preferred Securities remaining subject
to the Pledge hereunder registered to it or endorsed in blank within fifteen
days of the date it relinquished possession. The Securities Intermediary
shall promptly notify the Company and the Collateral Agent of the Securities
Intermediary's failure to obtain possession of any such replacement
certificate as required hereby.
Section 2.2. Control and Perfection. In connection with the
Pledge granted in Section 2.1, and subject to the other provisions of this
Agreement, the Holders from time to time acting through the Purchase Contract
Agent, as their attorney-in-fact, hereby authorize and direct the Securities
Intermediary (without the necessity of obtaining the further consent of the
Purchase Contract Agent or any of the Holders), and the Securities
Intermediary agrees, to comply with and follow any instructions and
entitlement orders (as defined in Section 8-102(a)(8) of the Code) that the
Collateral Agent on behalf of the Company may give in writing with respect to
the Collateral Account, the Collateral credited thereto and any security
entitlements with respect to any thereof. Such instructions and entitlement
orders may, without limitation, direct the Securities Intermediary to
transfer, redeem, sell, liquidate, assign, deliver or otherwise dispose of
the Preferred Securities, the Treasury Securities, the Treasury Portfolio,
and any Security Entitlements with respect thereto and to pay and deliver any
income, proceeds or other funds derived therefrom to the Company. The
Holders from time to time acting through the Purchase Contract Agent hereby
further authorize and direct the Collateral Agent, as agent of the Company,
to itself issue instructions and entitlement orders, and to otherwise take
action, with respect to the Collateral Account, the Collateral credited
thereto and any security entitlements with respect thereto, pursuant to the
terms and provisions hereof, all without the necessity of obtaining the
further consent of the Purchase Contract Agent or any of the Holders. The
Collateral Agent shall be the Agent of the Company and shall act as directed
in writing by the Company. Without limiting the generality of the foregoing,
the Collateral Agent shall issue entitlement orders to the Securities
Intermediary when and as directed by the Company.
Section 3. Distributions on Pledged Collateral. So long as the
Purchase Contract Agent is the registered owner of the Pledged Preferred
Securities, it shall receive all payments thereon. If the Pledged Preferred
Securities are reregistered, such that the Collateral Agent becomes the
registered holder, all payments of the Stated Amount of or, if applicable,
the appropriate Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio, or cash distributions
on, the Pledged Preferred Securities or on 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 all payments of the
principal of, or cash distributions on, any Pledged Treasury Securities
received by the Collateral Agent that are properly payable hereunder shall be
paid by the Collateral Agent by wire transfer in same day funds:
(i) In the case of (A) cash distributions with respect to
the 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 Stated Amount or, if applicable, the appropriate
Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio with respect to
any Preferred Securities or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, that have
been released from the Pledge pursuant to Section 4.3 hereof, to the
Purchase Contract Agent, for the benefit of the relevant Holders of
Securities, to the account designated by the Purchase Contract Agent
for such purpose, no later than 2:00 p.m., New York City time, on the
Business Day such payment is received by the Collateral Agent
(provided that in the event such payment is received by the
Collateral Agent on a day that is not a Business Day or after 12:30
p.m., New York City time, on a Business Day, then such payment shall
be made no later than 10:30 a.m., New York City time, on the next
succeeding Business Day);
(ii) In the case of any principal payments with respect to
any Treasury Securities that have been released from the Pledge
pursuant to Section 4.3 hereof, to the Holders of the Growth PRIDES
to the accounts designated by them in writing for such purpose no
later than 2:00 p.m., New York City time, on the Business Day such
payment is received by the Collateral Agent (provided that in the
event such payment is received by the Collateral Agent on a day that
is not a Business Day or after 12:30 p.m., New York City time, on a
Business Day, then such payment shall be made no later than 10:30
a.m., New York City time, on the next succeeding Business Day); and
(iii) In the case of payments of the Stated Amount of any
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 the principal of
any Pledged Treasury Securities, to the Company on the Purchase
Contract Settlement Date in accordance with the procedure set forth
in Section 4.6(a) or 4.6(b) hereof, in full satisfaction of the
respective obligations of the Holders under the related Purchase
Contracts.
All payments received by the Purchase Contract Agent as provided herein shall
be applied by the Purchase Contract Agent pursuant to the provisions of the
Purchase Contract Agreement. If, notwithstanding the foregoing, the Purchase
Contract Agent shall receive any payments of the Stated Amount or, if
applicable, the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) on account of any Preferred
Security or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as applicable that, at the time of such payment, is a Pledged
Preferred Security or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, or a Holder of a Growth PRIDES shall
receive any payments of principal on account of any Treasury Securities that,
at the time of such payment, are Pledged Treasury Securities, the Purchase
Contract Agent or such Holder shall hold the same as trustee of an express
trust for the benefit of the Company (and promptly deliver the same over to
the Company) for application to the obligations of the Holders under the
related Purchase Contracts, and the Holders shall acquire no right, title or
interest in any such payments of Stated Amount or principal so received.
Section 4. Substitution, Release, Repledge and Settlement
of Preferred Securities.
Section 4.1. Substitution of Preferred Securities and the
Creation of Growth PRIDES or Income PRIDES.
(A) At any time on or prior to the fifth Business Day
immediately preceding the Purchase Contract Settlement Date (unless a Tax
Event Redemption has occurred), a Holder of Income PRIDES shall have the
right to substitute Treasury Securities for the Pledged Preferred Securities
securing such Holder's obligations under the Purchase Contract(s) comprising
a part of its Income PRIDES in integral multiples of 100 Income PRIDES by (a)
Transferring to the Collateral Agent Treasury Securities having a Value equal
to the Stated Amount of the Pledged Preferred Securities to be released and
(b)(i) in the event that Contract Adjustment Payments are at a higher rate
for Growth PRIDES than for Income PRIDES, delivering cash in an amount equal
to the excess of the Contract Adjustment Payments that would have accrued
since the last Payment Date through the date of substitution on the Growth
PRIDES being created by the holder, over the Contract Adjustment Payments
that have accrued over the same time period on the related Income PRIDES,
which amount the Purchase Contract Agent shall promptly remit to the Company,
and (ii) delivering the related Income PRIDES to the Purchase Contract Agent,
accompanied by a notice, substantially in the form of Exhibit B hereto, to
the Purchase Contract Agent stating that such Holder has Transferred Treasury
Securities to the Collateral Agent pursuant to clause (a) above (stating the
Value of the Treasury Securities Transferred by such Holder) and requesting
that the Purchase Contract Agent instruct the Collateral Agent to release
from the Pledge the Pledged Preferred Securities related to such Income
PRIDES. The Purchase Contract Agent shall instruct the Collateral Agent in
the form provided in Exhibit A; provided, however, that if a Tax Event
Redemption has occurred and the Treasury Portfolio has become a component of
the Income PRIDES, Holders of Income PRIDES may make such substitution only
in integral multiples of 160,000 Income PRIDES at any time on or prior to the
second Business Day immediately preceding the Purchase Contract Settlement
Date. Upon receipt of Treasury Securities from a Holder of Income PRIDES and
the related instruction from the Purchase Contract Agent, the Collateral
Agent shall release the Pledged Preferred Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
and shall promptly Transfer such Pledged Preferred Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the
case may be, free and clear of any lien, pledge or security interest created
hereby, to the Purchase Contract Agent.
(B) At any time on or prior to the fifth Business Day
immediately preceding the Purchase Contract Settlement Date (unless a Tax
Event Redemption has occurred), a Holder of Growth PRIDES shall have the
right to establish or reestablish Income PRIDES consisting of the Purchase
Contracts and Preferred Securities in integral multiples of 100 Income PRIDES
by (a) Transferring to the Collateral Agent Preferred Securities having a
Stated Amount equal to the Stated Amount of the Pledged Treasury Securities
to be released and (b)(i) in the event that Contract Adjustment Payments are
at a higher rate for Income PRIDES than for Growth PRIDES, holders of Growth
PRIDES wishing to recreate Income PRIDES will also be required to deliver
cash in an amount equal to the excess of the Contract Adjustment Payments
that would have accrued since the last payment date through the date of
substitution on the Income PRIDES being recreated by such holders, over the
Contract Adjustment Payments that have accrued over the same time period on
the related Growth PRIDES and (ii) delivering the related Growth PRIDES to
the Purchase Contract Agent, accompanied by a notice, substantially in the
form of Exhibit B hereto, to the Purchase Contract Agent stating that such
Holder has transferred Preferred Securities to the Collateral Agent pursuant
to clause (a) above and requesting that the Purchase Contract Agent instruct
the Collateral Agent to release from the Pledge the Pledged Treasury
Securities related to such Growth PRIDES. The Purchase Contract Agent shall
instruct the Collateral Agent in the form provided in Exhibit A; provided,
however, that if a Tax Event Redemption has occurred and the Treasury
Portfolio has become a component of the Income PRIDES, Holders of Growth
PRIDES may make such substitution only in integral multiples of 160,000
Growth PRIDES, at any time on or prior to the Business Day immediately
preceding the Purchase Contract Settlement Date. Upon receipt of the
Preferred Securities or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, from such Holder and the instruction
from the Purchase Contract Agent, the Collateral Agent shall release the
Treasury Securities and shall promptly Transfer such Treasury Securities,
free and clear of any lien, pledge or security interest created hereby, to
the Purchase Contract Agent.
Section 4.2. Pledge of Preferred Securities and Re-
establishment of Income PRIDES or Growth PRIDES.
(A) At any time on or prior to the fifth Business Day
immediately preceding the Purchase Contract Settlement Date (unless a Tax
Event Redemption has occurred), a Holder of Income PRIDES shall have the
right to substitute Treasury Securities for the Pledged Preferred Securities
securing such Holder's obligations under the Purchase Contract(s) comprising
a part of its Income PRIDES in integral multiples of 100 Income PRIDES by (a)
Transferring to the Collateral Agent Treasury Securities having a Value equal
to the Stated Amount of the Pledged Preferred Securities to be released and
(b)(i) in the event that Contract Adjustment Payments are at a higher rate
for Growth PRIDES than for Income PRIDES, delivering cash in an amount equal
to the excess of the Contract Adjustment Payments that would have accrued
since the last Payment Date through the date of substitution on the Growth
PRIDES being created by the holder, over the Contract Adjustment Payments
that have accrued over the same time period on the related Income PRIDES,
which amount the Purchase Contract Agent shall promptly remit to the Company,
and (ii) delivering the related Income PRIDES to the Purchase Contract Agent,
accompanied by a notice, substantially in the form of Exhibit B hereto, to
the Purchase Contract Agent stating that such Holder has Transferred Treasury
Securities to the Collateral Agent pursuant to clause (a) above (stating the
Value of the Treasury Securities Transferred by such Holder) and requesting
that the Purchase Contract Agent instruct the Collateral Agent to release
from the Pledge the Pledged Preferred Securities related to such Income
PRIDES. The Purchase Contract Agent shall instruct the Collateral Agent in
the form provided in Exhibit A; provided, however, that if a Tax Event
Redemption has occurred and the Treasury Portfolio has become a component of
the Income PRIDES, Holders of Income PRIDES may make such substitution only
in integral multiples of 160,000 Income PRIDES at any time on or prior to the
second Business Day immediately preceding the Purchase Contract Settlement
Date. Upon receipt of Treasury Securities from a Holder of Income PRIDES and
the related instruction from the Purchase Contract Agent, the Collateral
Agent shall release the Pledged Preferred Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
and shall promptly Transfer such Pledged Preferred Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the
case may be, free and clear of any lien, pledge or security interest created
hereby, to the Purchase Contract Agent.
(B) At any time on or prior to the fifth Business Day
immediately preceding the Purchase Contract Settlement Date (unless a Tax
Event Redemption has occurred), a Holder of Growth PRIDES shall have the
right to establish or reestablish Income PRIDES consisting of the Purchase
Contracts and Preferred Securities in integral multiples of 100 Income PRIDES
by (a) Transferring to the Collateral Agent Preferred Securities having a
Stated Amount equal to the Stated Amount of the Pledged Treasury Securities
to be released and (b) (i) in the event that Contract Adjustment Payments are
at a higher rate for Income PRIDES than for Growth PRIDES, holders of Growth
PRIDES wishing to recreate Income PRIDES will also be required to deliver
cash in an amount equal to the excess of the Contract Adjustment Payments
that would have accrued since the last payment date through the date of
substitution on the Income PRIDES being recreated by such holders, over the
Contract Adjustment Payments that have accrued over the same time period on
the related Growth PRIDES and (ii) delivering the related Growth PRIDES to
the Purchase Contract Agent, accompanied by a notice, substantially in the
form of Exhibit B hereto, to the Purchase Contract Agent stating that such
Holder has transferred Preferred Securities to the Collateral Agent pursuant
to clause (a) above and requesting that the Purchase Contract Agent instruct
the Collateral Agent to release from the Pledge the Pledged Treasury
Securities related to such Growth PRIDES. The Purchase Contract Agent shall
instruct the Collateral Agent in the form provided in Exhibit A; provided,
however, that if a Tax Event Redemption has occurred and the Treasury
Portfolio has become a component of the Income PRIDES, Holders of Growth
PRIDES may make such substitution only in integral multiples of 160,000
Growth PRIDES, at any time on or prior to the Business Day immediately
preceding the Purchase Contract Settlement Date. Upon receipt of the
Preferred Securities or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, from such Holder and the instruction
from the Purchase Contract Agent, the Collateral Agent shall release the
Treasury Securities and shall promptly Transfer such Treasury Securities,
free and clear of any lien, pledge or security interest created hereby, to
the Purchase Contract Agent.
Section 4.3. Termination Event. Upon receipt by the
Collateral Agent of written notice from the Company or the Purchase Contract
Agent that there has occurred a Termination Event, the Collateral Agent shall
release all Collateral from the Pledge and shall promptly Transfer any
Pledged Preferred Securities (or the Applicable Ownership Interest of the
Treasury Portfolio if a Tax Event Redemption has occurred) and Pledged
Treasury Securities to the Purchase Contract Agent for the benefit of the
Holders of the Income PRIDES and the Growth PRIDES, respectively, free and
clear of any lien, pledge or security interest or other interest created
hereby.
If such Termination Event shall result from the Company's
becoming a debtor under the Bankruptcy Code, and if the Collateral Agent
shall for any reason fail promptly to effectuate the release and Transfer of
all Pledged Preferred Securities, the Treasury Portfolio or of the Pledged
Treasury Securities, as the case may be, as provided by this Section 4.3, the
Purchase Contract Agent shall (i) use its best efforts to obtain an opinion
of a nationally recognized law firm reasonably acceptable to the Collateral
Agent to the effect that, as a result of the Company's being the debtor in
such a bankruptcy case, the Collateral Agent will not be prohibited from
releasing or Transferring the Collateral as provided in this Section 4.3, and
shall deliver such opinion to the Collateral Agent within ten days after the
occurrence of such Termination Event, and if (y) the Purchase Contract Agent
shall be unable to obtain such opinion within ten days after the occurrence
of such Termination Event or (z) the Collateral Agent shall continue, after
delivery of such opinion, to refuse to effectuate the release and Transfer of
all Pledged Preferred Securities, of the Treasury Portfolio or of the Pledged
Treasury Securities, as the case may be, as provided in this Section 4.3,
then the Purchase Contract Agent shall within fifteen days after the
occurrence of such Termination Event commence an action or proceeding in the
court with jurisdiction of the Company's case under the Bankruptcy Code
seeking an order requiring the Collateral Agent to effectuate the release and
transfer of all Pledged Preferred Securities, of the Treasury Portfolio or of
the Pledged Treasury Securities, as the case may be, as provided by this
Section 4.3 or (ii) commence an action or proceeding like that described in
subsection (i)(z) hereof within ten days after the occurrence of such
Termination Event.
Section 4.4. Cash Settlement. (a) Upon receipt by the
Collateral Agent of (i) a notice from the Purchase Contract Agent promptly
after the receipt by the Purchase Contract Agent of such notice that a Holder
of an Income PRIDES or Growth PRIDES has elected, in accordance with the
procedures specified in Section 5.4(a)(i) or (d)(i) of the Purchase Contract
Agreement, respectively, to settle its Purchase Contract with cash and (ii)
payment by such Holder on or prior to 11:00 a.m., New York City time, on the
Business Day immediately preceding the Purchase Contract Settlement Date in
lawful money of the United States by certified or cashiers' check or wire
transfer in immediately available funds payable to or upon the order of the
Company, then the Collateral Agent shall, upon the written direction of the
Purchase Contract Agent, promptly invest any Cash received from a Holder in
connection with a Cash Settlement in Permitted Investments. Upon receipt of
the proceeds upon the maturity of the Permitted Investments on the Purchase
Contract Settlement Date, the Collateral Agent shall pay the portion of such
proceeds and deliver any certified or cashiers' checks received, in an
aggregate amount equal to the Purchase Price, to the Company on the Purchase
Contract Settlement Date, and shall distribute any funds in respect of the
interest earned from the Permitted Investments to the Purchase Contract Agent
for payment to the relevant Holders.
(b) If a Holder of an Income PRIDES fails to notify the
Agent of its intention to make a Cash Settlement in accordance with paragraph
5.4(a)(i) of the Purchase Contract Agreement, such failure shall constitute
an event of default under the Purchase Contract Agreement and hereunder, and
the Holder shall be deemed to have consented to the disposition of the
pledged Preferred Securities pursuant to the remarketing as described in
paragraph 5.4(b) of the Purchase Contract Agreement, which is incorporated
herein by reference. If a Holder of an Income PRIDES does notify the Agent
as provided in paragraph 5.4(a)(i) of the Purchase Contract Agreement of its
intention to pay the Purchase Price in cash, but fails to make such payment
as required by paragraph 5.4(a)(ii) of the Purchase Contract Agreement, the
Preferred Securities of such a Holder will not be remarketed but instead the
Collateral Agent, for the benefit of the Company, will exercise its rights as
a secured party with respect to such Preferred Securities at the direction of
the Company to retain or dispose of the Collateral in accordance with
applicable law. In addition, in the event of a Failed Remarketing as
described in paragraph 5.4(b) of the Purchase Contract Agreement, such Failed
Remarketing shall constitute an event of default hereunder by such Holder and
the Collateral Agent, for the benefit of the Company, will also exercise its
rights as a secured party with respect to such Preferred Securities at the
direction of the Company to retain or dispose of the Collateral in accordance
with applicable law.
(c) If a Holder of a Growth PRIDES fails to notify the
Purchase Contract Agent of such Holder's intention to make a Cash Settlement
in accordance with paragraph 5.4(d)(i) of the Purchase Contract Agreement, or
if a Holder of an Income PRIDES does notify the Agent as provided in
paragraph (d)(i) of the Purchase Contract Agreement of its intention to pay
the Purchase Price in cash, but fails to make such payment as required by
paragraph 5.4(d)(ii) of the Purchase Contract Agreement, such failure shall
constitute an event of default hereunder by such Holder and upon the maturity
of any Pledged Treasury Securities or the Treasury Portfolio, if any, held by
the Collateral Agent on the Business Day immediately preceding the Purchase
Contract Settlement Date, the principal amount of the Pledged Treasury
Securities or the Treasury Portfolio received by the Collateral Agent shall,
upon written direction of the Purchase Contract Agent, be invested promptly
in Permitted Investments. On the Purchase Contract Settlement Date, an
amount equal to the Purchase Price will be remitted to the Company as payment
thereof. In the event the sum of the proceeds from the related Pledged
Treasury Securities or the Treasury Portfolio, as the case may be, and the
investment earnings earned from such investments is in excess of the
aggregate Purchase Price of the Purchase Contracts being settled thereby, the
Collateral Agent will distribute such excess to the Purchase Contract Agent
for the benefit of the Holder of the related Growth PRIDES or Income PRIDES
when received.
Section 4.5. Early Settlement. Upon written notice to the
Collateral Agent by the Purchase Contract Agent that one or more Holders of
Securities have elected to effect Early Settlement of their respective
obligations under the Purchase Contracts forming a part of such Securities in
accordance with the terms of the Purchase Contracts and the Purchase Contract
Agreement (setting forth the number of such Purchase Contracts as to which
such Holders have elected to effect Early Settlement), and that the Purchase
Contract Agent has received from such Holders, and paid to the Company as
confirmed in writing by the Company, the related Early Settlement Amounts
pursuant to the terms of the Purchase Contracts and the Purchase Contract
Agreement and that all conditions to such Early Settlement have been
satisfied, then the Collateral Agent shall release from the Pledge, (a)
Pledged Preferred Securities or the appropriate Applicable Ownership Interest
of the Treasury Portfolio in the case of a Holder of Income PRIDES or (b)
Pledged Treasury Securities in the case of a Holder of Growth PRIDES, as the
case may be, with a principal amount equal to the product of (i) the Stated
Amount times (ii) the number of such Purchase Contracts as to which such
Holders have elected to effect Early Settlement and shall Transfer all such
Pledged Preferred Securities or the appropriate Applicable Ownership Interest
of the Treasury Portfolio or Pledged Treasury Securities, as the case may be,
free and clear of the Pledge created hereby, to the Purchase Contract Agent
for the benefit of the Holders.
Section 4.6. Application of Proceeds Settlement. (a) In
the event a Holder of Income PRIDES (if a Tax Event Redemption has not
occurred) has not elected to make an effective Cash Settlement by notifying
the Purchase Contract Agent in the manner provided for in paragraph 5.4(a)(i)
in the Purchase Contract Agreement or has not made an Early Settlement of the
Purchase Contract(s) underlying its Income PRIDES, such Holder shall be
deemed to have elected to pay for the shares of Common Stock to be issued
under such Purchase Contract(s) from the Proceeds of the related Pledged
Preferred Securities. The Collateral Agent shall, by 10:00 a.m., New York
City time, on the fourth Business Day immediately preceding the Purchase
Contract Settlement Date, without any instruction from such Holder of Income
PRIDES, present the related Pledged Preferred Securities to the Remarketing
Agent for remarketing. Upon receiving such Pledged Preferred Securities, the
Remarketing Agent, pursuant to the terms of the Remarketing Agreement and the
Remarketing Underwriting Agreement, will use its reasonable efforts to
remarket such Pledged Preferred Securities on such date at a price not less
than approximately 100.5% of the aggregate Stated Amount of such Pledged
Preferred Securities, plus accrued and unpaid distributions (including
deferred distributions), if any, thereon. After deducting as the Remarketing
Fee an amount not exceeding 25 basis points (.25%) of the aggregate Stated
Amount of the Pledged Preferred Securities from any amount of such Proceeds
in excess of the aggregate Stated Amount, plus such accrued and unpaid
distributions (including deferred distributions) of the remarketed Pledged
Preferred Securities, the Remarketing Agent will remit the entire amount of
the Proceeds of such remarketing to the Collateral Agent. On the Purchase
Contract Settlement Date, the Collateral Agent shall apply that portion of
the Proceeds from such remarketing equal to the aggregate Stated Amount, plus
such accrued and unpaid distributions (including deferred distributions) of
such Pledged Preferred Securities, to satisfy in full the obligations of such
Holders of Income PRIDES to pay the Purchase Price to purchase the Common
Stock under the related Purchase Contracts. The remaining portion of such
Proceeds, if any, shall be distributed by the Collateral Agent to the
Purchase Contract Agent for payment to the Holders. If the Remarketing Agent
advises the Collateral Agent in writing that it cannot remarket the related
Pledged Preferred Securities of such Holders of Income PRIDES at a price not
less than 100% of the aggregate Stated Amount of such Pledged Preferred
Securities plus any accrued and unpaid distributions (including deferred
distributions), thus resulting in a Failed Remarketing and an event of
default under the Purchase Contract Agreement and hereunder, the Collateral
Agent, for the benefit of the Company will, at the written direction of the
Company, retain or dispose of the Pledged Preferred Securities in accordance
with applicable law and satisfy in full, from any such disposition or
retention, such Holder's obligation to pay the Purchase Price for the Common
Stock.
(b) In the event a Holder of Growth PRIDES or Income PRIDES
(if a Tax Event Redemption has occurred) has not made an Early Settlement of
the Purchase Contract(s) underlying its Growth PRIDES or Income PRIDES, such
Holder shall be deemed to have elected to pay for the shares of Common Stock
to be issued under such Purchase Contract(s) from the Proceeds of the related
Pledged Treasury Securities or the Treasury Portfolio, as the case may be.
On the Business Day immediately prior to the Purchase Contract Settlement
Date, the Collateral Agent shall, at the written direction of the Purchase
Contract Agent, invest the Cash proceeds of the maturing Pledged Treasury
Securities or the Treasury Portfolio, as the case may be, in overnight
Permitted Investments. Without receiving any instruction from any such Holder
of Growth PRIDES or Income PRIDES, the Collateral Agent shall apply the
Proceeds of the related Pledged Treasury Securities or Treasury Portfolio to
the settlement of such Purchase Contracts on the Purchase Contract Settlement
Date.
In the event the sum of the Proceeds from the related
Pledged Treasury Securities or Treasury Portfolio and the investment earnings
from the investment in overnight Permitted Investments is in excess of the
aggregate Purchase Price of the Purchase Contracts being settled thereby, the
Collateral Agent shall distribute such excess, when received, to the Purchase
Contract Agent for the benefit of the Holders.
(c) Pursuant to the Remarketing Agreement and subject to the
terms of the Remarketing Underwriting Agreement, on or prior to the fifth
Business Day immediately preceding the Purchase Contract Settlement Date, but
no earlier than the Payment Date immediately preceding the Purchase Contract
Settlement Date, holders of separate Preferred Securities which are not
components of Income PRIDES may elect to have their Preferred Securities
remarketed by delivering their Preferred Securities along with a notice of
such election to the Collateral Agent. The Collateral Agent will hold such
Preferred Securities in an account separate from the collateral account in
which the Pledged Securities will be held. Holders of Preferred Securities
electing to have their Preferred Securities remarketed will also have the
right to withdraw such election by written notice to the Collateral Agent on
or prior to the fifth Business Day immediately preceding the Purchase
Contract Settlement Date, upon which notice the Collateral Agent will return
such Preferred Securities to such holders. On the fourth Business Day
immediately preceding the Purchase Contract Settlement Date, the Collateral
Agent will deliver the Preferred Securities to the Remarketing Agent for
remarketing. The Remarketing Agent will use its reasonable efforts to
remarket such Preferred Securities on such date at a price of approximately
100.5% of the aggregate stated liquidation amount of such Preferred
Securities, plus accrued and unpaid distributions (including deferred
distributions), if any, thereon. The portion of the proceeds from such
remarketing equal to the aggregate stated liquidation amount of such
Preferred Securities will automatically be remitted by the Remarketing Agent
to the Collateral Agent for the benefit of such Preferred Securities holders.
In addition, after deducting as the Remarketing Fee an amount not exceeding
25 basis points (.25%) of the aggregate stated liquidation amount of the
remarketed securities, from any amount of such proceeds in excess of the
aggregate stated liquidation amount of the remarketed Trust Preferred
Securities plus any accrued and unpaid distributions (including deferred
distributions, if any), the Remarketing Agent will remit to the Collateral
Agent the remaining portion of the proceeds, if any, for the benefit of such
holder. If, despite using its reasonable efforts, the Remarketing Agent
advises the Collateral Agent in writing that it cannot remarket the related
Preferred Securities of such holders at a price not less than 100% of the
aggregate stated liquidation amount of such Preferred Securities plus accrued
and unpaid distributions (including deferred distributions) and thus
resulting in a Failed Remarketing, the Remarketing Agent will promptly return
such Trust Preferred Securities to the Collateral Agent to release to such
holders.
Section 5. Voting Rights -- Preferred Securities. The
Purchase Contract Agent may exercise, or refrain from exercising, any and all
voting and other consensual rights pertaining to the Pledged Preferred
Securities or any part thereof for any purpose not inconsistent with the
terms of this Agreement and in accordance with the terms of the Purchase
Contract Agreement; provided, that the Purchase Contract Agent shall not
exercise or, as the case may be, shall not refrain from exercising such right
if, in the judgment of the Company, such action would impair or otherwise
have a material adverse effect on the value of all or any of the Pledged
Preferred Securities; and provided, further, that the Purchase Contract Agent
shall give the Company and the Collateral Agent at least five days' prior
written notice of the manner in which it intends to exercise, or its reasons
for refraining from exercising, any such right. Upon receipt of any notices
and other communications in respect of any Pledged Preferred Securities,
including notice of any meeting at which holders of Preferred Securities are
entitled to vote or solicitation of consents, waivers or proxies of holders
of Preferred Securities, the Collateral Agent shall use reasonable efforts to
send promptly to the Purchase Contract Agent such notice or communication,
and as soon as reasonably practicable after receipt of a written request
therefor from the Purchase Contract Agent, execute and deliver to the
Purchase Contract Agent such proxies and other instruments in respect of such
Pledged Preferred Securities (in form and substance satisfactory to the
Collateral Agent) as are prepared by the Purchase Contract Agent with respect
to the Pledged Preferred Securities.
Section 6. Rights and Remedies; Distribution of the
Debentures; Tax Event Redemption.
Section 6.1. Rights and Remedies of the Collateral Agent.
(a) In addition to the rights and remedies specified in Section 4.4 hereof
or otherwise available at law or in equity, after an event of default
hereunder, the Collateral Agent shall have all of the rights and remedies
with respect to the Collateral of a secured party under the Uniform
Commercial Code as in effect in the State of New York (the "Code") (whether
or not the Code is in effect in the jurisdiction where the rights and
remedies are asserted) and the TRADES Regulations and such additional rights
and remedies to which a secured party is entitled under the laws in effect in
any jurisdiction where any rights and remedies hereunder may be asserted.
Without limiting the generality of the foregoing, such remedies may include,
to the extent permitted by applicable law, (i) retention of the Pledged
Preferred Securities or other Collateral in full satisfaction of the Holders
obligations under the Purchase Contracts or (ii) sale of the Pledged
Preferred Securities or other Collateral in one or more public or private
sales.
(b) Without limiting any rights or powers otherwise granted
by this Agreement to the Collateral Agent, in the event the Collateral Agent
is unable to make payments to the Company on account of the appropriate
Applicable Ownership Interest (as specified in clause (A) of the definition
of such term) of the Treasury Portfolio or on account of principal payments
of any Pledged Treasury Securities as provided in Section 3 hereof in
satisfaction of the obligations of the Holder of the Securities of which such
Pledged Treasury Securities, or the appropriate Applicable Ownership Interest
(as specified in clause (A) of the definition of such term) of the Treasury
Portfolio, as applicable, is a part under the related Purchase Contracts, the
inability to make such payments shall constitute an event of default
hereunder and the Collateral Agent shall have and may exercise, with
reference to such Pledged Treasury Securities, or such appropriate Applicable
Ownership Interest (as specified in clause (A) of the definition of such
term) of the Treasury Portfolio, as applicable, and such obligations of such
Holder, any and all of the rights and remedies available to a secured party
under the Code and the TRADES Regulations after default by a debtor, and as
otherwise granted herein or under any other law.
(c) Without limiting any rights or powers otherwise granted
by this Agreement to the Collateral Agent, the Collateral Agent is hereby
irrevocably authorized to receive and collect all payments of (i) the Stated
Amount of or, cash distributions on, the Pledged Preferred Securities, (ii)
the principal amount of the Pledged Treasury Securities, or (iii) the
appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, subject, in each case, to
the provisions of Section 3, and as otherwise granted herein.
(d) The Purchase Contract Agent and each Holder of
Securities, in the event such Holder becomes the Holder of a Growth PRIDES,
agrees that, from time to time, upon the written request of the Collateral
Agent, the Purchase Contract Agent or such Holder shall execute and deliver
such further documents and do such other acts and things as the Collateral
Agent may reasonably request in order to maintain the Pledge, and the
perfection and priority thereof, and to confirm the rights of the Collateral
Agent hereunder. The Purchase Contract Agent shall have no liability to any
Holder for executing any documents or taking any such acts requested by the
Collateral Agent hereunder, except for liability for its own negligent act,
its own negligent failure to act or its own willful misconduct.
Section 6.2. Distribution of the Debentures; Tax Event
Redemption. Upon the occurrence of an Investment Company Event or a
liquidation of the Trust, a principal amount of the Debentures constituting
the assets of the Trust and underlying the Preferred Securities equal to the
aggregate Stated Amount of the Pledged Preferred Securities shall be
delivered to the Collateral Agent in exchange for the Pledged Preferred
Securities. In the event the Collateral Agent receives such Debentures in
respect of Pledged Preferred Securities upon the occurrence of an Investment
Company Event or liquidation of the Trust, the Collateral Agent shall
Transfer the Debentures to the Collateral Account in the manner specified
herein for Pledged Preferred Securities to secure the obligations of the
Holders of Income PRIDES to purchase the Company's Common Stock under the
related Purchase Contracts. Thereafter, the Collateral Agent shall have such
security interests, rights and obligations with respect to the Debentures as
it had in respect of the Pledged Preferred Securities as provided in Articles
II, III, IV, V and VI hereof, and any reference herein to the Pledged
Preferred Securities shall be deemed to be referring to such Debentures.
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 Principal Amount of
Debentures shall be delivered to the Collateral Agent by the Institutional
Trustee or upon a dissolution of the Trust and the distribution of the
related Debentures by the Debenture Trustee on or prior to 12:30 p.m., New
York City time, by check or wire transfer in immediately available funds at
such place and at such account as may be designated by the Collateral Agent
in exchange for the Pledged Preferred Securities or Debentures, as the case
may be. In the event the Collateral Agent receives such Redemption Price,
the Collateral Agent will, at the written direction of the Company, apply an
amount equal to the Redemption Amount of such Redemption Price to purchase
from the Quotation Agent, the Treasury Portfolio and promptly remit the
remaining portion of such Redemption Price to the Purchase Contract Agent for
payment to the Holders of Income PRIDES. The Collateral Agent shall Transfer
the Treasury Portfolio to the Collateral Account in the manner specified
herein for Pledged Preferred Securities to secure the obligation of all
Holders of Income PRIDES to purchase Common Stock of the Company under the
Purchase Contracts constituting a part of such Income PRIDES, in substitution
for the Pledged Preferred Securities. Thereafter the Collateral Agent shall
have such security interests, rights and obligations with respect to the
Treasury Portfolio as it had in respect of the Pledged Preferred Securities
or Debentures, as the case may be, as provided in Articles II, III, IV, V,
and VI, and any reference herein to the Pledged Preferred Securities or the
Debentures shall be deemed to be reference to such Treasury Portfolio.
Section 6.3. Substitutions. Whenever a Holder has the
right to substitute Treasury Securities, Preferred Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the
case may be, for Collateral held by the Collateral Agent, such substitution
shall not constitute a novation of the security interest created hereby.
Section 7. Representations and Warranties; Covenants.
Section 7.1. Representations and Warranties. The Holders
from time to time, acting through the Purchase Contract Agent as their
attorney-in-fact (it being understood that the Purchase Contract Agent shall
not be liable for any representation or warranty made by or on behalf of a
Holder), hereby represent and warrant to the Collateral Agent, which
representations and warranties shall be deemed repeated on each day a Holder
Transfers Collateral that:
(a) such Holder has the power to grant a security interest
in and lien on the Collateral;
(b) such Holder is the sole beneficial owner of the
Collateral and, in the case of Collateral delivered in physical form,
is the sole holder of such Collateral and is the sole beneficial
owner of, or has the right to Transfer, the Collateral it Transfers
to the Collateral Agent, free and clear of any security interest,
lien, encumbrance, call, liability to pay money or other restriction
other than the security interest and lien granted under Section 2
hereof;
(c) upon the Transfer of the Collateral to the Collateral
Account, the Collateral Agent, for the benefit of the Company, will
have a valid and perfected first priority security interest therein
(assuming that any central clearing operation or any Intermediary or
other entity not within the control of the Holder involved in the
Transfer of the Collateral, including the Collateral Agent, gives the
notices and takes the action required of it hereunder and under
applicable law for perfection of that interest and assuming the
establishment and exercise of control pursuant to Section 2.2
hereof); and
(d) the execution and performance by the Holder of its
obligations under this Agreement will not result in the creation of
any security interest, lien or other encumbrance on the Collateral
other than the security interest and lien granted under Section 2
hereof or violate any provision of any existing law or regulation
applicable to it or of any mortgage, charge, pledge, indenture,
contract or undertaking to which it is a party or which is binding on
it or any of its assets.
Section 7.2. Covenants. The Holders from time to time,
acting through the Purchase Contract Agent as their attorney-in-fact (it
being understood that the Purchase Contract Agent shall not be liable for any
covenant made by or on behalf of a Holder), hereby covenant to the Collateral
Agent that for so long as the Collateral remains subject to the Pledge:
(a) neither the Purchase Contract Agent nor such Holders
will create or purport to create or allow to subsist any mortgage,
charge, lien, pledge or any other security interest whatsoever over
the Collateral or any part of it other than pursuant to this
Agreement; and
(b) neither the Purchase Contract Agent nor such Holders
will sell or otherwise dispose (or attempt to dispose) of the
Collateral or any part of it except for the beneficial interest
therein, subject to the pledge hereunder, transferred in connection
with the Transfer of the Securities.
Section 8. The Collateral Agent. It is hereby agreed as
follows:
Section 8.1. Appointment, Powers and Immunities. The
Collateral Agent shall act as agent for the Company hereunder with such
powers as are specifically vested in the Collateral Agent by the terms of
this Agreement, together with such other powers as are reasonably incidental
thereto. The Collateral Agent: (a) shall have no duties or responsibilities
except those expressly set forth in this Agreement and no implied covenants
or obligations shall be inferred from this Agreement against the Collateral
Agent, nor shall the Collateral Agent be bound by the provisions of any
agreement by any party hereto beyond the specific terms hereof; (b) shall not
be responsible for any recitals contained in this Agreement, or in any
certificate or other document referred to or provided for in, or received by
it under, this Agreement, the Securities or the Purchase Contract Agreement,
or for the value, validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement (other than as against the Collateral Agent),
the Securities or the Purchase Contract Agreement or any other document
referred to or provided for herein or therein or for any failure by the
Company or any other Person (except the Collateral Agent) to perform any of
its obligations hereunder or thereunder or for the perfection, priority or,
except as expressly required hereby, maintenance of any security interest
created hereunder; (c) shall not be required to initiate or conduct any
litigation or collection proceedings hereunder (except pursuant to directions
furnished under Section 8.2 hereof, subject to Section 8.6 hereof); (d) shall
not be responsible for any action taken or omitted to be taken by it
hereunder or under any other document or instrument referred to or provided
for herein or in connection herewith or therewith, except for its own
negligence or willful misconduct; and (e) shall not be required to advise any
party as to selling or retaining, or taking or refraining from taking any
action with respect to, any securities or other property deposited hereunder.
Subject to the foregoing, during the term of this Agreement, the Collateral
Agent shall take all reasonable action in connection with the safekeeping and
preservation of the Collateral hereunder.
No provision of this Agreement shall require the Collateral
Agent to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder. In no event
shall the Collateral Agent be liable for any amount in excess of the Value of
the Collateral. Notwithstanding the foregoing, the Collateral Agent and
Securities Intermediary in its individual capacity hereby waive any right of
setoff, bankers lien, liens or perfection rights as securities intermediary
or any counterclaim with respect to any of the Collateral.
Section 8.2. Instructions of the Company. The Company
shall have the right, by one or more instruments in writing executed and
delivered to the Collateral Agent, to direct the time, method and place of
conducting any proceeding for the realization of any right or remedy
available to the Collateral Agent, or of exercising any power conferred on
the Collateral Agent, or to direct the taking or refraining from taking of
any action authorized by this Agreement; provided, however, that (i) such
direction shall not conflict with the provisions of any law or of this
Agreement and (ii) the Collateral Agent shall be adequately indemnified as
provided herein. Nothing in this Section 8.2 shall impair the right of the
Collateral Agent in its discretion to take any action or omit to take any
action which it deems proper and which is not inconsistent with such
direction.
Section 8.3. Reliance by Collateral Agent. Each of the
Securities Intermediary and the Collateral Agent shall be entitled to rely
upon any certification, order, judgment, opinion, notice or other
communication (including, without limitation, any thereof by telephone,
telecopy, telex or facsimile) believed by it to be genuine and correct and to
have been signed or sent by or on behalf of the proper Person or Persons
(without being required to determine the correctness of any fact stated
therein), and upon advice and statements of legal counsel and other experts
selected by the Collateral Agent and the Securities Intermediary. As to any
matters not expressly provided for by this Agreement, the Collateral Agent
and the Securities Intermediary shall in all cases be fully protected in
acting, or in refraining from acting, hereunder in accordance with
instructions given by the Company in accordance with this Agreement.
Section 8.4. Rights in Other Capacities. The Collateral
Agent and the Securities Intermediary and their affiliates may (without
having to account therefor to the Company) accept deposits from, lend money
to, make their investments in and generally engage in any kind of banking,
trust or other business with the Purchase Contract Agent and any Holder of
Securities (and any of their respective subsidiaries or affiliates) as if it
were not acting as the Collateral Agent, and the Collateral Agent and its
affiliates may accept fees and other consideration from the Purchase Contract
Agent and any Holder of Securities without having to account for the same to
the Company; provided that each of the Securities Intermediary and the
Collateral Agent covenants and agrees with the Company that it shall not
accept, receive or permit there to be created in favor of itself and shall
take no affirmative action to permit there to be created in favor of any
other Person, any security interest, lien or other encumbrance of any kind in
or upon the Collateral.
Section 8.5. Non-Reliance on Collateral Agent. Neither the
Securities Intermediary nor the Collateral Agent shall be required to keep
itself informed as to the performance or observance by the Purchase Contract
Agent or any Holder of Securities of this Agreement, the Purchase Contract
Agreement, the Securities or any other document referred to or provided for
herein or therein or to inspect the properties or books of the Purchase
Contract Agent or any Holder of Securities. The Collateral Agent shall not
have any duty or responsibility to provide the Company with any credit or
other information concerning the affairs, financial condition or business of
the Purchase Contract Agent or any Holder of Securities (or any of their
respective affiliates) that may come into the possession of the Collateral
Agent or the Securities Intermediary or any of their respective affiliates.
Section 8.6. Compensation and Indemnity. The Company
agrees: (i) to pay the Collateral Agent from time to time such compensation
as shall be agreed in writing between the Company and the Collateral Agent
for all services rendered by it hereunder and (ii) to indemnify the
Collateral Agent and the Securities Intermediary for, and to hold each of
them harmless from and against, any loss, liability or reasonable out-of-
pocket expense incurred without negligence, willful misconduct or bad faith
on its part, arising out of or in connection with the acceptance or
administration of its powers and duties under this Agreement, including the
reasonable out-of-pocket costs and expenses (including reasonable fees and
expenses of counsel) of defending itself against any claim or liability in
connection with the exercise or performance of such powers and duties.
Section 8.7. Failure to Act. In the event of any ambiguity
in the provisions of this Agreement or any dispute between or conflicting
claims by or among the parties hereto or any other Person with respect to any
funds or property deposited hereunder, the Collateral Agent shall be
entitled, after prompt notice to the Company and the Purchase Contract Agent,
at its sole option, to refuse to comply with any and all claims, demands or
instructions with respect to such property or funds so long as such dispute
or conflict shall continue, and the Collateral Agent shall not be or become
liable in any way to any of the parties hereto for its failure or refusal to
comply with such conflicting claims, demands or instructions. The Collateral
Agent shall be entitled to refuse to act until either (i) such conflicting or
adverse claims or demands shall have been finally determined by a court of
competent jurisdiction or settled by agreement between the conflicting
parties as evidenced in a writing, satisfactory to the Collateral Agent or
(ii) the Collateral Agent shall have received security or an indemnity
satisfactory to the Collateral Agent sufficient to save the Collateral Agent
harmless from and against any and all loss, liability or reasonable out-of-
pocket expense which the Collateral Agent may incur by reason of its acting.
The Collateral Agent may in addition elect to commence an interpleader action
or seek other judicial relief or orders as the Collateral Agent may deem
necessary. Notwithstanding anything contained herein to the contrary, the
Collateral Agent shall not be required to take any action that is in its
opinion contrary to law or to the terms of this Agreement, or which would in
its opinion subject it or any of its officers, employees or directors to
liability.
Section 8.8. Resignation of Collateral Agent. Subject to
the appointment and acceptance of a successor Collateral Agent as provided
below, (a) the Collateral Agent may resign at any time by giving notice
thereof to the Company and the Purchase Contract Agent as attorney-in-fact
for the Holders of Securities, (b) the Collateral Agent may be removed at any
time by the Company and (c) if the Collateral Agent fails to perform any of
its material obligations hereunder in any material respect for a period of
not less than 20 days after receiving written notice of such failure by the
Purchase Contract Agent and such failure shall be continuing, the Collateral
Agent may be removed by the Purchase Contract Agent. The Purchase Contract
Agent shall promptly notify the Company of any removal of the Collateral
Agent pursuant to clause (c) of the immediately preceding sentence. Upon any
such resignation or removal, the Company shall have the right to appoint a
successor Collateral Agent. If no successor Collateral Agent shall have been
so appointed and shall have accepted such appointment within 30 days after
the retiring Collateral Agent's giving of notice of resignation or such
removal, then the retiring Collateral Agent may petition any court of
competent jurisdiction for the appointment of a successor Collateral Agent.
The Collateral Agent shall be a bank which has an office in New York, New
York with a combined capital and surplus of at least $750,000,000. Upon the
acceptance of any appointment as Collateral Agent hereunder by a successor
Collateral Agent, such successor Collateral Agent shall thereupon succeed to
and become vested with all the rights, powers, privileges and duties of the
retiring Collateral Agent, and the retiring Collateral Agent shall take all
appropriate action to transfer any money and property held by it hereunder
(including the Collateral) to such successor Collateral Agent. The retiring
Collateral Agent shall, upon such succession, be discharged from its duties
and obligations as Collateral Agent hereunder. After any retiring Collateral
Agent's resignation hereunder as Collateral Agent, the provisions of this
Section 8 shall continue in effect for its benefit in respect of any actions
taken or omitted to be taken by it while it was acting as the Collateral
Agent.
Section 8.9. Right to Appoint Agent or Advisor. The
Collateral Agent shall have the right to appoint agents or advisors in
connection with any of its duties hereunder, and the Collateral Agent shall
not be liable for any action taken or omitted by, or in reliance upon the
advice of, such agents or advisors selected in good faith. The appointment
of agents pursuant to this Section 8.9 shall be subject to prior consent of
the Company, which consent shall not be unreasonably withheld.
Section 8.10. Survival. The provisions of this Section 8
shall survive termination of this Agreement and the resignation or removal of
the Collateral Agent.
Section 8.11. Exculpation. Anything in this Agreement to
the contrary notwithstanding, in no event shall the Collateral Agent or the
Securities Intermediary or their 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
Collateral Agent or the Securities Intermediary, or any of them, incurred
without any act or deed that is found to be attributable to gross negligence
or willful misconduct on the part of the Collateral Agent or the Securities
Intermediary.
Section 9. Amendment.
Section 9.1. Amendment Without Consent of Holders. Without
the consent of any Holders, the Company, the Collateral Agent and the
Purchase Contract Agent, at any time and from time to time, may amend this
Agreement, in form satisfactory to the Company, the Collateral Agent and the
Purchase Contract Agent, for any of the following purposes:
(1) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of
the Company; or
(2) to add to the covenants of the Company for the benefit
of the Holders, or to surrender any right or power herein conferred
upon the Company so long as such covenants or such surrender do not
adversely affect the validity, perfection or priority of the security
interests granted or created hereunder; or
(3) to evidence and provide for the acceptance of
appointment hereunder by a successor Collateral Agent, Securities
Intermediary or Purchase Contract Agent; or
(4) to cure any ambiguity, to correct or supplement any
provisions herein which may be inconsistent with any other such
provisions herein, or to make any other provisions with respect to
such matters or questions arising under this Agreement, provided such
action shall not adversely affect the interests of the Holders.
Section 9.2. Amendment with Consent of Holders. With the
consent of the Holders of not less than a majority of the Purchase Contracts
at the time outstanding, by Act of said Holders delivered to the Company,
the Purchase Contract Agent or the Collateral Agent, as the case may be, the
Company, when duly authorized, the Purchase Contract Agent and the Collateral
Agent may amend this Agreement for the purpose of modifying in any manner the
provisions of this Agreement or the rights of the Holders in respect of the
Securities; provided, however, that no such supplemental agreement shall,
without the consent of the Holder of each Outstanding Security adversely
affected thereby,
(1) change the amount or type of Collateral underlying a
Security (except for the rights of holders of Income PRIDES to
substitute the Treasury Securities for the Pledged Preferred
Securities or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, or the rights of Holders of
Growth PRIDES to substitute Preferred Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as
applicable, for the Pledged Treasury Securities), impair the right of
the Holder of any Security to receive distributions on the underlying
Collateral or otherwise adversely affect the Holder's rights in or to
such Collateral; or
(2) otherwise effect any action that would require the
consent of the Holder of each Outstanding Security affected thereby
pursuant to the Purchase Contract Agreement if such action were
effected by an agreement supplemental thereto; or
(3) reduce the percentage of Purchase Contracts the consent
of whose Holders is required for any such amendment.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed amendment, but it shall be
sufficient if such Act shall approve the substance thereof.
Section 9.3. Execution of Amendments. In executing any
amendment permitted by this Section, the Collateral Agent and the Purchase
Contract Agent shall be entitled to receive and (subject to Section 6.1
hereof, with respect to the Collateral Agent, and Section 7.1 of the Purchase
Contract Agreement, with respect to the Purchase Contract Agent) shall be
fully protected in relying upon, an Opinion of Counsel stating that the
execution of such amendment is authorized or permitted by this Agreement and
that all conditions precedent, if any, to the execution and delivery of such
amendment have been satisfied.
Section 9.4. Effect of Amendments. Upon the execution of
any amendment under this Section, this Agreement shall be modified in
accordance therewith, and such amendment 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 under the
Purchase Contract Agreement shall be bound thereby.
Section 9.5. Reference to Amendments. Security
Certificates authenticated, executed on behalf of the Holders and delivered
after the execution of any amendment pursuant to this Section may, and shall
if required by the Collateral Agent or the Purchase Contract Agent, bear a
notation in form approved by the Purchase Contract Agent and the Collateral
Agent as to any matter provided for in such amendment. If the Company shall
so determine, new Security Certificates so modified as to conform, in the
opinion of the Collateral Agent, the Purchase Contract Agent and the Company,
to any such amendment may be prepared and executed by the Company and
authenticated, executed on behalf of the Holders and delivered by the
Purchase Contract Agent in accordance with the Purchase Contract Agreement in
exchange for Outstanding Security Certificates.
Section 10. Miscellaneous.
Section 10.1. No Waiver. No failure on the part of the
Collateral Agent or any of its agents to exercise, and no course of dealing
with respect to, and no delay in exercising, any right, power or remedy
hereunder shall operate as a waiver thereof; nor shall any single or partial
exercise by the Collateral Agent or any of its agents of any right, power or
remedy hereunder preclude any other or further exercise thereof or the
exercise of any other right, power or remedy. The remedies herein are
cumulative and are not exclusive of any remedies provided by law.
Section 10.2. Governing Law. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK. Without limiting the foregoing, the above choice of law is expressly
agreed to by the Securities Intermediary, the Collateral Agent and the
Holders from time to time acting through the Purchase Contract Agent, as
their attorney-in-fact, in connection with the establishment and maintenance
of the Collateral Account. The Company, the Collateral Agent and the Holders
from time to time of the Securities, acting through the Purchase Contract
Agent as their attorney-in-fact, hereby submit to the nonexclusive
jurisdiction of the United States District Court for the Southern District of
New York and of any New York state court sitting in New York City for the
purposes of all legal proceedings arising out of or relating to this
Agreement or the transactions contemplated hereby. The Company, the
Collateral Agent and the Holders from time to time of the Securities, acting
through the Purchase Contract Agent as their attorney-in-fact, irrevocably
waive, to the fullest extent permitted by applicable law, any objection which
they may now or hereafter have to the laying of the venue of any such
proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum.
Section 10.3. Notices. All notices, requests, consents and
other communications provided for herein (including, without limitation, any
modifications of, or waivers or consents under, this Agreement) shall be
given or made in writing (including, without limitation, by telecopy)
delivered to the intended recipient at the "Address for Notices" specified
below its name on the signature pages hereof or, as to any party, at such
other address as shall be designated by such party in a notice to the other
parties. Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid.
Section 10.4. Successors and Assigns. This Agreement shall
be binding upon and inure to the benefit of the respective successors and
assigns of the Company, the Collateral Agent and the Purchase Contract Agent,
and the Holders from time to time of the Securities, by their acceptance of
the same, shall be deemed to have agreed to be bound by the provisions hereof
and to have ratified the agreements of, and the grant of the Pledge hereunder
by, the Purchase Contract Agent.
Section 10.5. Counterparts. This Agreement may be executed
in any number of counterparts, all of which taken together shall constitute
one and the same instrument, and any of the parties hereto may execute this
Agreement by signing any such counterpart.
Section 10.6. Severability. If any provision hereof is
invalid and unenforceable in any jurisdiction, then, to the fullest extent
permitted by law, (i) the other provisions hereof shall remain in full force
and effect in such jurisdiction and shall be liberally construed in order to
carry out the intentions of the parties hereto as nearly as may be possible
and (ii) the invalidity or unenforceability of any provision hereof in any
jurisdiction shall not affect the validity or enforceability of such
provision in any other jurisdiction.
Section 10.7. Expenses, etc. The Company agrees to
reimburse the Collateral Agent for: (a) all reasonable out-of-pocket costs
and expenses of the Collateral Agent (including, without limitation, the
reasonable fees and expenses of counsel to the Collateral Agent), in
connection with (i) the negotiation, preparation, execution and delivery or
performance of this Agreement and (ii) any modification, supplement or waiver
of any of the terms of this Agreement; (b) all reasonable costs and expenses
of the Collateral Agent (including, without limitation, reasonable fees and
expenses of counsel) in connection with (i) any enforcement or proceedings
resulting or incurred in connection with causing any Holder of Securities to
satisfy its obligations under the Purchase Contracts forming a part of the
Securities and (ii) the enforcement of this Section 10.7; and (c) all
transfer, stamp, documentary or other similar taxes, assessments or charges
levied by any governmental or revenue authority in respect of this Agreement
or any other document referred to herein and all costs, expenses, taxes,
assessments and other charges incurred in connection with any filing,
registration, recording or perfection of any security interest contemplated
hereby.
Section 10.8. Security Interest Absolute. All rights of
the Collateral Agent and security interests hereunder, and all obligations of
the Holders from time to time hereunder, shall be absolute and unconditional
irrespective of:
(a) any lack of validity or enforceability of any provision
of the Purchase Contracts or the Securities or any other agreement or
instrument relating thereto;
(b) any change in the time, manner or place of payment of,
or any other term of, or any increase in the amount of, all or any of
the obligations of Holders of Securities under the related Purchase
Contracts, or any other amendment or waiver of any term of, or any
consent to any departure from any requirement of, the Purchase
Contract Agreement or any Purchase Contract or any other agreement or
instrument relating thereto; or
(c) any other circumstance which might otherwise constitute
a defense available to, or discharge of, a borrower, a guarantor or a
pledgor.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
XXXXXXXXX-XXXX COMPANY
By:_______________________________
Name:
Title:
Address for Notices:
XXXXXXXXX-XXXX COMPANY
000 Xxxxxxxx Xxxxx Xxxx
Xxxxxxxxx Xxxx, Xxx Xxxxxx 00000
Attention: Chief Financial Officer
Telecopy: (000) 000-0000
THE FIRST NATIONAL BANK OF CHICAGO,
as Purchase Contract Agent and as
attorney-in-fact of the Holders
from time to time of the Securities
By:_______________________________
Name:
Title:
Address for Notices:
The First National Bank of Chicago
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000-0000
Attention: Corporate Trust Administration
Telecopy: (000) 000-0000
THE CHASE MANHATTAN BANK, as Collateral
Agent and as Securities Intermediary
By: _______________________________
Name:
Title:
Address for Notices:
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Corporate Trust
Administration Department
Telecopy: (000) 000-0000
EXHIBIT A
INSTRUCTION FROM PURCHASE CONTRACT AGENT TO COLLATERAL AGENT
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000-0000
Attention: Corporate Trust Administration Department
Re: FELINE PRIDES of Xxxxxxxxx-Xxxx Company (the
"Company"), and Xxxxxxxxx-Xxxx Financing I
We hereby notify you in accordance with Section 4.1 of the
Pledge Agreement, dated as of __, 1998, (the "Pledge Agreement")
among the Company, yourselves, as Collateral Agent, and ourselves, as
Purchase Contract Agent and as attorney-in-fact for the holders of [Income
PRIDES] [Growth PRIDES] from time to time, that the holder of securities
listed below (the "Holder") has elected to substitute [$_____ aggregate
principal amount of Treasury Securities] [$_______Stated Amount of Preferred
Securities or the appropriate Applicable Ownership Interest of the Treasury
Portfolio] in exchange for an equal Value of [Pledged Preferred Securities or
the appropriate Applicable Ownership Interest of the Treasury Portfolio]
[Pledged Treasury Securities] held by you in accordance with the Pledge
Agreement and has delivered to us a notice stating that the Holder has
Transferred [Treasury Securities] [Preferred Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio] to you, as
Collateral Agent. We hereby instruct you, upon receipt of such [Pledged
Treasury Securities] [Pledged Preferred Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio], to release the
[Preferred Securities or the appropriate Applicable Ownership Interest of the
Treasury Portfolio] [Treasury Securities] related to such [Income PRIDES]
[Growth PRIDES] to us in accordance with the Holder's instructions.
Capitalized terms used herein but not defined shall have the meaning set
forth in the Pledge Agreement.
Date:_______________ _______________________________________
By:____________________________________
Name:
Title:
Signature Guarantee:___________________
Please print name and address of Registered Holder electing to substitute
[Treasury Securities] [Preferred Securities or the appropriate Applicable
Ownership Interest of the Treasury Portfolio] for the [Pledged Preferred
Securities or the Treasury Portfolio] [Pledged Treasury Securities]:
______________________ _______________________________________
Name Social Security or other Taxpayer
Identification Number, if any
______________________
Address
______________________
______________________
EXHIBIT B
INSTRUCTION TO PURCHASE CONTRACT AGENT
The First National Bank of Chicago
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000-0000
Attention: Corporate Trust Services Division
Re: FELINE PRIDES of Xxxxxxxxx-Xxxx Company (the
"Company"), and Xxxxxxxxx-Xxxx Financing I
The undersigned Holder hereby notifies you that it has delivered to
The Chase Manhattan Bank, as Collateral Agent, [$_______ aggregate principal
amount of Treasury Securities] [$ aggregate Stated Amount of
Preferred Securities or the appropriate Applicable Ownership Interest of the
Treasury Portfolio of the appropriate Applicable Ownership Interest of the
Treasury Portfolio] in exchange for an equal Value of [Pledged Preferred
Securities or the appropriate Applicable Ownership Interest of the Treasury
Portfolio] [Pledged Treasury Securities] held by the Collateral Agent (the
"Pledge Agreement"), in accordance with Section 4.1 of the Pledge Agreement,
dated , 1998, between you, the Company and the Collateral Agent.
The undersigned Holder hereby instructs you to instruct the Collateral Agent
to release to you on behalf of the undersigned Holder the [Pledged Preferred
Securities or the appropriate Applicable Ownership Interest of the Treasury
Portfolio] [Pledged Treasury Securities] related to such [Income PRIDES]
[Growth PRIDES]. Capitalized terms used herein but not defined shall have
the meaning set forth in the Pledge Agreement.
Dated:________________ _______________________________________
Signature
Signature Guarantee:__________________
Please print name and address of Registered Holder:
______________________ _______________________________________
Name Social Security or other Taxpayer
Identification Number, if any
______________________
Address
______________________
______________________
______________________
XXXXXXXXX-XXXX COMPANY,
THE CHASE MANHATTAN BANK,
as Collateral Agent
AND
,
as Purchase Contract Agent
PLEDGE AGREEMENT
Dated as of March , 1998
TABLE OF CONTENTS
Page
Section 1. Definitions . . . . . . . . . . . . . . . . . . . . . . . . 2
Section 2. Pledge; Control and Perfection . . . . . . . . . . . . . . 5
Section 2.1. The Pledge . . . . . . . . . . . . . . . . . . . . . . . . 5
Section 2.2. Control and Perfection . . . . . . . . . . . . . . . . . . 6
Section 3. Distributions on Pledged Collateral . . . . . . . . . . . . 7
Section 4. Substitution, Release, Repledge and Settlement of
Preferred Securities . . . . . . . . . . . . . . . . . . . . . 8
Section 4.1. Substitution of Preferred Securities and the Creation
of Growth PRIDES or Income PRIDES . . . . . . . . . . . . . . 8
Section 4.2. Pledge of Preferred Securities and Re-establishment of
Income PRIDES or Growth PRIDES . . . . . . . . . . . . . . . .10
Section 4.3. Termination Event . . . . . . . . . . . . . . . . . . . . . 11
Section 4.4. Cash Settlement . . . . . . . . . . . . . . . . . . . . . . 11
Section 4.5. Early Settlement . . . . . . . . . . . . . . . . . . . . . 13
Section 4.6. Application of Proceeds Settlement. . . . . . . . . . . . 13
Section 5. Voting Rights -- Preferred Securities . . . . . . . . . . . 15
Section 6. Rights and Remedies; Distribution of the Debentures;
Tax Event Redemption . . . . . . . . . . . . . . . . . . . . .15
Section 6.1. Rights and Remedies of the Collateral Agent . . . . . . . . 15
Section 6.2. Distribution of the Debentures; Tax Event Redemption . . . 16
Section 6.3. Substitutions. . . . . . . . . . . . . . . . . . . . . . . 17
Section 7. Representations and Warranties; Covenants . . . . . . . . . 17
Section 7.1. Representations and Warranties . . . . . . . . . . . . . . 17
Section 7.2. Covenants . . . . . . . . . . . . . . . . . . . . . . . . . 18
Section 8. The Collateral Agent . . . . . . . . . . . . . . . . . . . 18
Section 8.1. Appointment, Powers and Immunities . . . . . . . . . . . . 18
Section 8.2. Instructions of the Company . . . . . . . . . . . . . . . . 19
Section 8.3. Reliance by Collateral Agent . . . . . . . . . . . . . . . 19
Section 8.4. Rights in Other Capacities . . . . . . . . . . . . . . . . 20
Section 8.5. Non-Reliance on Collateral Agent . . . . . . . . . . . . . 20
Section 8.6. Compensation and Indemnity . . . . . . . . . . . . . . . . 20
Section 8.7. Failure to Act . . . . . . . . . . . . . . . . . . . . . . 20
Section 8.8. Resignation of Collateral Agent . . . . . . . . . . . . . . 21
Section 8.9. Right to Appoint Agent or Advisor . . . . . . . . . . . . . 21
Section 8.10. Survival . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 8.11. Exculpation . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 9. Amendment . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 9.1. Amendment Without Consent of Holders . . . . . . . . . . . 22
Section 9.2. Amendment with Consent of Holders . . . . . . . . . . . . . 22
Section 9.3. Execution of Amendments . . . . . . . . . . . . . . . . . . 23
Section 9.4. Effect of Amendments . . . . . . . . . . . . . . . . . . . 23
Section 9.5. Reference to Amendments . . . . . . . . . . . . . . . . . . 23
Section 10. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . 24
Section 10.1. No Waiver . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 10.2. Governing Law . . . . . . . . . . . . . . . . . . . . . . 24
Section 10.3. Notices . . . . . . . . . . . . . . . . . . . . . . . . . 24
Section 10.4. Successors and Assigns . . . . . . . . . . . . . . . . . . 24
Section 10.5. Counterparts . . . . . . . . . . . . . . . . . . . . . . . 24
Section 10.6. Severability . . . . . . . . . . . . . . . . . . . . . . . 25
Section 10.7. Expenses, etc. . . . . . . . . . . . . . . . . . . . . . . 25
Section 10.8. Security Interest Absolute . . . . . . . . . . . . . . . . 25
EXHIBIT A INSTRUCTION TO COLLATERAL AGENT
EXHIBIT B INSTRUCTION TO PURCHASE CONTRACT AGENT
