Exhibit 4.3
XXX COMMUNICATIONS, INC.
THE BANK OF NEW YORK,
as Collateral Agent, Custodial Agent
and Securities Intermediary
AND
THE FIRST NATIONAL BANK OF CHICAGO,
as Purchase Contract Agent
PLEDGE AGREEMENT
Dated as of August 12, 1999
Table of Contents
Page
ARTICLE I
Definitions
Section 1.1 Definitions.................................................2
ARTICLE II Pledge; Control
and Perfection.
Section 2.1 The Pledge..................................................6
Section 2.2 Control and Perfection......................................7
ARTICLE III Distributions on
Pledged Collateral.
ARTICLE IV
Substitution, Release, Repledge and Settlement of Capital Securities.
Section 4.1 Substitution for Capital Securities and the Creation of
Growth Prides..............................................10
Section 4.2 Substitution of Treasury Securities and the Creation of
Income Prides..............................................11
Section 4.3 Termination Event..........................................11
Section 4.4 Cash Settlement............................................12
Section 4.5 Early Settlement...........................................13
Section 4.6 Application of Proceeds Settlement.........................14
ARTICLE V
Voting Rights -- Capital Securities.
ARTICLE VI
Rights and Remedies; Distribution of the Debentures; Tax Event Redemption
Section 6.1 Rights and Remedies of the Collateral Agent................16
Section 6.2 Distribution of the Debentures; Investment Company
Event; Tax Event Redemption................................17
Section 6.3 Substitutions..............................................18
ARTICLE VII Representations
and Warranties; Covenants.
Section 7.1 Representations and Warranties.............................18
Section 7.2 Covenants..................................................19
ARTICLE VIII
The Collateral Agent.
Section 8.1 Appointment, Powers and Immunities.........................19
Section 8.2 Instructions of the Company................................20
Section 8.3 Reliance by Collateral Agent...............................20
Section 8.4 Rights in Other Capacities.................................21
Section 8.5 Non-Reliance on Collateral Agent...........................21
Section 8.6 Compensation and Indemnity.................................21
Section 8.7 Failure to Act.............................................22
Section 8.8 Resignation of Collateral Agent............................22
Section 8.9 Right to Appoint Agent or Advisor..........................23
Section 8.10 Survival...................................................23
Section 8.11 Exculpation................................................23
ARTICLE IX
Amendment.
Section 9.1 Amendment Without Consent of Holders.......................24
Section 9.2 Amendment with Consent of Holders..........................24
Section 9.3 Execution of Amendments....................................25
Section 9.4 Effect of Amendments.......................................25
Section 9.5 Reference to Amendments....................................25
ARTICLE X
Miscellaneous.
Section 10.1 No Waiver..................................................25
Section 10.2 GOVERNING LAW..............................................26
Section 10.3 Notices....................................................26
Section 10.4 Successors and Assigns.....................................26
Section 10.5 Counterparts...............................................26
Section 10.6 Severability...............................................26
Section 10.7 Expenses, Etc..............................................27
Section 10.8 Security Interest Absolute.................................27
EXHIBIT A
Instruction to Collateral Agent.............................................A-1
EXHIBIT B
Instruction to Purchase Contract Agent......................................B-1
EXHIBIT C
Instruction to Custodial Agent Regarding Remarketing........................C-1
EXHIBIT D
Instruction to Custodial Agent Regarding Withdrawal from
Remarketing.................................................................D-1
PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of August 12, 1999 (this "Agreement"), among
Xxx Communications, Inc., a Delaware corporation (the "Company"), The Bank of
New York, 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"), as custodial agent (in such capacity,
together with its successors in such capacity, the "Custodial Agent") and as
"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 herein after 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 13,000,000 FELINE PRIDES of the Company
(14,950,000 if the Underwriters' over-allotment option pursuant to the
Underwriting Agreement and Pricing Agreement is exercised in full), having a
stated amount of $50 (the "Stated Amount") per FELINE PRIDES.
The FELINE PRIDES will initially consist of (A) 11,700,000 units
(referred to as "Income PRIDES") with a face amount, per Income PRIDES, equal to
the Stated Amount and (B) 1,300,000 units (referred to as "Growth PRIDES" and,
together with the Income PRIDES, the "Securities") with a face amount, per
Growth PRIDES, equal to the Stated Amount. Each Income PRIDES will initially be
comprised of (a) a stock purchase contract (the "Purchase Contract") under which
the holder will purchase from the Company not later than August 16, 2002 (the
"Purchase Contract Settlement Date"), for an amount of cash equal to the Stated
Amount, a number of shares of the Class A common stock, $1.00 par value per
share (the "Common Stock"), of the Company equal to the Settlement Rate (as
defined below), and (b) either beneficial ownership of a Capital Security (as
defined below) or upon the occurrence of a Tax Event Redemption (as defined
herein) prior to the Purchase Contract Settlement Date, the Applicable Ownership
Interest of the Treasury Portfolio (as defined below). Each Growth PRIDES will
initially be comprised of (a) a Purchase Contract under which (i) the holder
will purchase from the Company not later than the Purchase Contract Settlement
Date, for an amount in cash equal to the Stated Amount, a number of shares of
Common Stock of the Company equal to the Settlement Rate, and (ii) the Company
will pay to the Holder, on a quarterly basis, unsecured contract adjustment
payments ("Contract Adjustment Payments") at the rate of .25% of the Stated
Amount per annum, and (b) a 1/20 undivided beneficial interest in a zero-coupon
U.S. Treasury Security (CUSIP No. 912820 BE 6) having a principal amount at
maturity equal to $1,000 and maturing on August 15, 2002 (the "Treasury
Securities").
Pursuant to the terms of the Declaration (as defined below), Xxx Trust
II, a statutory business trust formed under the laws of the State of Delaware
(the "Trust"), will issue 13,000,000 (14,950,000 if the Underwriters'
over-allotment option pursuant to the Underwriting Agreement and Pricing
Agreement is exercised in full) 7% Capital Securities, (the "Capital
Securities") having a stated liquidation value equal to the Stated Amount.
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 Capital Securities,
any Applicable Ownership Interest in the Treasury Portfolio 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 Capital Securities, any Applicable Ownership
Interest in the Treasury Portfolio and the Treasury 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, the Custodial Agent 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:
ARTICLE I
Definitions
Section 1.1. Definitions. For all purposes of this agreement, except as
otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(b) 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) Contract Adjustment
Payments,(vii) Debentures, (viii) Early Settlement, (ix) Early Settlement
Amount, (x) Early Settlement Date, (xi) Failed Remarketing, (xii) Holder,
(xiii) Opinion of Counsel, (xiv) Outstanding Securities, (xv) Remarketing
Agent, (xvi) Remarketing Agreement, (xvii) Settlement Rate, and (xviii)
Termination Event; and
(d) the following terms have the meanings as signed to them in the
Declaration: (i) Applicable Principal Amount, (ii) Indenture, (iii)
Investment Company Event, (iv) Primary Treasury Dealer, (v) Property
Trustee, (vi) Quotation Agent, (vii) Redemption Amount, (viii) Redemption
Price, (ix) Tax Event, (x) Tax Event
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Redemption, (xi) Tax Event Redemption Date, (xii) Treasury Portfolio, and
(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.
"Applicable Ownership Interest" means, with respect to an Income PRIDES
and the U.S. Treasury Securities in the Treasury Portfolio, (A) a 1/20, or 5%,
undivided beneficial ownership interest in a $1,000 principal or interest amount
of a principal or interest strip in a U.S. Treasury Security included in such
Treasury Portfolio which matures on or prior to August 15, 2002 and (B) for each
scheduled interest payment date on the Debentures that occurs after the Tax
Event Redemption Date, a .0875% undivided beneficial ownership interest in a
$1,000 face amount of such U.S. Treasury Security which is a principal or
interest strip maturing on such date.
"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, Sunday or any
other day on which banking institutions and trust companies in The City of New
York are permitted or required by any applicable law to close.
"Capital Securities" has the meaning specified in the Recitals.
"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 securities account (number 077976)
maintained at The Bank of New York in the name "The First National Bank of
Chicago, as Purchase Contract Agent on behalf of the holders of certain
securities of Xxx Trust II, Collateral Account subject to the security interest
of The Bank of New York, as Collateral Agent, for the benefit of Xxx
Communications, Inc., as pledgee" and any successor account.
"Collateral Agent" has the meaning specified in the first paragraph of
this Agreement.
"Common Stock" has the meaning specified in the Recitals.
"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.
"Custodial Agent" has the meaning specified in the Recitals.
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"Debenture Trustee" means The Bank of New York, 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 August 12, 1999 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 $200,000,000 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) 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 ("S&P") or at least equal to "P-1" by Xxxxx'x Investors
Service, Inc. ("Moody's"); and (v) investments in money market funds registered
under the Investment Company Act of 1940, as amended, and 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 Capital Securities" has the meaning specified in Section 2.1
hereof.
"Pledged Treasury Securities" has the meaning specified in Section 2.1
hereof.
"Proceeds" means all interest, dividends, cash, instruments,
securities, financial assets (as defined in Sections 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.
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"Purchase Contract Agent" has the meaning specified in the first
paragraph of this Agreement.
"Purchase Contract Agreement" has the meaning specified in the
Recitals.
"Purchase Contract Settlement Date" has the meaning specified in the
Recitals.
"Remarketing Underwriting Agreement" means the Remarketing Underwriting
Agreement attached as Exhibit A to the Remarketing Agreement.
"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.
"Separate Capital Securities" means any Capital Securities that are not
Pledged Capital Securities.
"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 "security 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. In the case of
Collateral to be delivered to the Collateral Agent, the
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Securities Intermediary shall be the Securities Intermediary and the
securities account shall be the Collateral Account.
"Treasury Security" has the meaning specified in the Recitals.
"Trust" has the meaning specified in the Recitals.
"Value" with respect to any item of Collateral on any date means, as to
(i) a Capital Security, the Stated Amount, (ii) Cash, the face amount thereof
and (iii) Treasury Securities, the aggregate principal amount thereof at
maturity.
ARTICLE II
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, and the Purchase Contract
Agent, as such 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 all of the right, title and
interest of the Purchase Contract Agent and such Holders (a) in the Capital
Securities and Treasury Securities constituting a part of the Securities and any
Treasury Securities delivered in exchange for any Capital Securities, and any
Capital Securities delivered in exchange for any Treasury Securities, in
accordance with Section 4.2 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; (b) in payments made by
Holders pursuant to Section 4.4; (c) in the Collateral Account and all
securities, financial assets, Cash 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 (all of the foregoing, collectively, the
"Collateral"). Prior to or concurrently with the execution and delivery of this
Agreement, the Purchase Contract Agent, on behalf of the initial Holders of the
Securities, shall cause the Capital Securities comprising a part of the Income
PRIDES, and the Treasury Securities comprising a part of the Growth PRIDES, to
be Transferred to the Collateral Agent for the benefit of the Company. Such
Capital Securities shall be Transferred by physically delivering such Securities
to the Securities Intermediary indorsed in blank and causing the Securities
Intermediary to credit the Collateral Account with such Securities and sending
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 Capital
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 Capital 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
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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 Capital
Securities (or the Debentures that are delivered pursuant to Section 6.2 hereof)
or Treasury Securities subject to the Pledge, excluding any Capital Securities
(or the Debentures that are delivered pursuant to Section 6.2 hereof) or
Treasury Securities released from the Pledge as provided in Sections 4.1 and 4.2
hereof, respectively, are hereinafter referred to as "Pledged Capital
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 Capital Securities or any other
Securities held in physical form in its name.
Except as may be required in order to release Capital 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 Capital 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 Capital Securities evidenced
thereby from the Pledge, the Securities Intermediary shall use its best efforts
to obtain physical possession of a replacement certificate evidencing any
Capital 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. (a) 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 Capital Securities, the Treasury Securities, the
Treasury Portfolio, and
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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.
(b) The Securities Intermediary hereby confirms and agrees that: (i) all
securities or other property underlying any financial assets credited to the
Collateral Account shall be registered in the name of the Securities
Intermediary, indorsed to the Securities Intermediary or in blank or credited to
another Collateral Account maintained in the name of the Securities Intermediary
and in no case will any financial asset credited to the Collateral Account be
registered in the name of the Purchase Contract Agent, the Collateral Agent, the
Company or any Holder, payable to the order of, or specially indorsed to, the
Purchase Contract Agent, the Collateral Agent, the Company or any Holder except
to the extent the foregoing have been specially indorsed to the Securities
Intermediary or in blank; (ii) all property delivered to the Securities
Intermediary pursuant to this Pledge Agreement (including, without limitation,
any Capital Securities, the Treasury Portfolio or Treasury Securities) will be
promptly credited to the Collateral Account; (iii) the Collateral Account is an
account to which financial assets are or may be credited, and the Securities
Intermediary shall, subject to the terms of this Agreement, treat the Purchase
Contract Agent as entitled to exercise the rights of any financial asset
credited to the Collateral Account; (iv) the Securities Intermediary has not
entered into, and until the termination of this Agreement will not enter into,
any agreement with any other person relating to the Collateral Account and/or
any financial assets credited thereto pursuant to which it has agreed to comply
with entitlement orders (as defined in Section 8-102(a)(8) of the Code) of such
other person; and (v) the Securities Intermediary has not entered into, and
until the termination of this Agreement will not enter into, any agreement with
the Company, the Collateral Agent or the Purchase Contract Agent purporting to
limit or condition the obligation of the Securities Intermediary to comply with
entitlement orders as set forth in this Section 2.2 hereof.
(c) The Securities Intermediary hereby agrees that each item of property
(whether investment property, financial asset, security, instrument or cash)
credited to the Collateral Account shall be treated as a "financial asset"
within the meaning of Section 8-102(a)(9) of the Code.
(d) In the event of any conflict between this Agreement (or any portion
thereof) and any other agreement now existing or hereafter entered into, the
terms of this Agreement shall prevail.
(e) The Purchase Contract Agent hereby irrevocably constitutes and appoints
the Collateral Agent and the Company, with full power of substitution, as the
Purchase Contract
8
Agent's attorney-in-fact to take on behalf of, and in the name, place and stead
of the Purchase Contract Agent and the Holders, any action necessary or
desirable to perfect and to keep perfected the security interest in the
Collateral referred to in Section 2.1. The grant of such power-of-attorney shall
not be deemed to require of the Collateral Agent any specific duties or
obligations not otherwise assumed by the Collateral Agent hereunder.
ARTICLE III
Distributions on Pledged Collateral.
So long as the Purchase Contract Agent is the registered owner of the
Pledged Capital Securities, it shall receive all payments thereon. If the
Pledged Capital Securities are reregistered, such that the Collateral Agent
becomes the registered holder, all 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, or cash
distributions on, the Pledged Capital 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
Capital 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 Capital 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
9
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
Capital 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 Capital Security or
the appropriate Applicable Ownership Interest of the Treasury Portfolio, as
applicable, that, at the time of such payment, is a Pledged Capital 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.
ARTICLE IV
Substitution, Release, Repledge and Settlement of Capital Securities.
Section 4.1 Substitution for Capital Securities and the Creation of Growth
Prides. 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 Capital Securities securing such Holder's obligations
under the Purchase Contract(s) comprising a part of its Income PRIDES in
integral multiples of 20 Income PRIDES by (a) Transferring to the Collateral
Agent Treasury Securities having a Value equal to the aggregate Stated Amount of
the Pledged Capital Securities to be released and (b)(i) delivering to the
Purchase Contract Agent cash in an amount equal to the Contract Adjustment
Payments that would have accrued since the last date that Contract Adjustment
Payments were made through the date of substitution on the Growth PRIDES being
created by the Holder, 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
10
release from the Pledge the Pledged Capital 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 8,000 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
Capital Securities or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, and shall promptly Transfer such Pledged
Capital 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. All items
Transferred and/or substituted by any Holder pursuant to this Section 4.1,
Section 4.2 or any other Section of this Agreement shall be Transferred and/or
substituted free and clear of all liens, claims and encumbrances.
Section 4.2 Substitution of Treasury Securities and the Creation of Income
Prides. 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 Capital
Securities in integral multiples of 20 Income PRIDES by (a) Transferring to the
Collateral Agent Capital Securities having a Value equal to the Value of the
Pledged Treasury Securities to be released and (b) 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 Capital 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 8,000 Growth PRIDES, at any time on
or prior to the Business Day immediately preceding the Purchase Contract
Settlement Date. Upon receipt of the Capital 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 Capital 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,
11
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
Capital 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 Capital
Securities, the Treasury Portfolio or 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 Capital Securities, 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 5.3(a)(i) or (d)(i) of the Purchase Contract Agreement, respectively, to
settle its Purchase Contract with Cash and (ii) payment of the amount required
to settle such contract 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 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 and any
funds so wired, 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 Purchase Contract
Agent of its intention to make a Cash Settlement in accordance with Section
5.3(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
12
of the Pledged Capital Securities pursuant to the remarketing as described in
Section 5.3(b) of the Purchase Contract Agreement, which is incorporated herein
by reference. If a Holder of an Income PRIDES does notify the Purchase Contract
Agent as provided in Section 5.3(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 Section 5.3(a)(ii) of the Purchase Contract Agreement, such failure
will constitute an event of default under the Purchase Contract Agreement and
hereunder, and the Capital 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 Capital 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 Section 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 Capital 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
Section 5.3(d)(i) of the Purchase Contract Agreement, or if a Holder of a Growth
PRIDES does notify the Purchase Contract Agent as provided in paragraph
5.3(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
5.3(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
Company, 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 Capital Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio in the case of a Holder
of Income
13
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 Capital 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 5.3(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 Capital 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 Capital Securities to
the Remarketing Agent for remarketing. Upon receiving such Pledged Capital
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 Capital Securities on such date at a price not
less than approximately 100.5% of the aggregate Value of such Pledged Capital
Securities, plus accumulated and unpaid distributions, if any, thereon. After
deducting as the remarketing fee an amount not exceeding 25 basis points (.25%)
of the aggregate Value of the Pledged Capital Securities from any amount of such
Proceeds in excess of the aggregate Value, plus such accumulated and unpaid
distributions of the remarketed Pledged Capital 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 Value, plus such accumulated and unpaid distributions of such Pledged
Capital 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 Capital Securities of such Holders
of Income PRIDES at a price not less than 100% of the aggregate Value of such
Pledged Capital Securities plus any accumulated and unpaid 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 Capital 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)
14
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 Capital Securities may elect to have their Separate Capital
Securities remarketed by delivering their Separate Capital Securities, together
with a notice of such election, substantially in the form of Exhibit C hereto,
to the Custodial Agent. The Custodial Agent will hold such Separate Capital
Securities in an account separate from the Collateral Account. A holder of
Separate Capital Securities electing to have its Separate Capital Securities
remarketed will also have the right to withdraw such election by written notice
to the Custodial Agent, substantially in the form of Exhibit D hereto, on or
prior to the fifth Business Day immediately preceding the Purchase Contract
Settlement Date, upon which notice the Custodial Agent will return such Separate
Capital Securities to such holder. On the fourth Business Day immediately
preceding the Purchase Contract Settlement Date, the Custodial Agent will
deliver to the Remarketing Agent for remarketing all Separate Capital Securities
delivered to the Custodial Agent pursuant to this Section 4.6(c) and not
withdrawn pursuant to the terms hereof prior to such date. The portion of the
proceeds from such remarketing equal to the aggregate Value of such Separate
Capital Securities will automatically be remitted by the Remarketing Agent to
the Custodial Agent for the benefit of the holders of such Separate Capital
Securities. In addition, after deducting as the remarketing fee an amount not
exceeding 25 basis points (.25%) of the Value of the remarketed Separate Capital
Securities, from any amount of such proceeds in excess of the aggregate Value of
the remarketed Separate Capital Securities plus any accrued and unpaid
distributions (including deferred distributions, if any), the Remarketing Agent
will remit to the Custodial Agent the remaining portion of the proceeds, if any,
for the benefit of such holders. If, despite using its reasonable efforts, the
Remarketing Agent advises the Custodial Agent in writing that it cannot remarket
the related Separate Capital Securities of such holders at a price not less than
100% of the aggregate Value of such Separate Capital Securities plus accrued and
unpaid distributions and thus resulting in a Failed Remarketing, the Remarketing
Agent will promptly
15
return such Capital Securities to the Custodial Agent for redelivery to such
holders. In the event of a dissolution of the Trust and the distribution of the
Debentures as described in the Declaration, all references to "Separate Capital
Securities" in this Section 4.6(c) shall be deemed to be references to
Debentures which are not pledged hereunder or required to be part of the
Collateral.
ARTICLE V
Voting Rights -- Capital Securities.
The Purchase Contract Agent may exercise, or refrain from exercising,
any and all voting and other consensual rights pertaining to the Pledged Capital
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 Capital 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 Capital Securities, including notice of any meeting at which holders
of Capital Securities are entitled to vote or solicitation of consents, waivers
or proxies of holders of Capital 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 Capital Securities (in form and substance satisfactory to the
Collateral Agent) as are prepared by the Purchase Contract Agent with respect to
the Pledged Capital Securities.
ARTICLE VI
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 (or any successor thereto) as in
effect in the State of New York from time to time (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. Wherever reference is
made in this Agreement to any section of the Code, such reference shall be
deemed to include a reference to any provision of the Code which is a successor
to, or amendment of, such section. Without limiting the generality of the
foregoing, such remedies may include, to the extent permitted by applicable law,
(i) retention of the Pledged Capital Securities or other Collateral in full
satisfaction of the Holders' obligations under the
16
Purchase Contracts or (ii) sale of the Pledged Capital 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 Article III 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 Capital 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, individually and as attorney-in-fact for
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, its bad faith or its own willful misconduct.
Section 6.2 Distribution of the Debentures; Investment Company Event; 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 Capital Securities equal to the aggregate
stated liquidation amount of the Pledged Capital Securities shall be delivered
to the Collateral Agent in exchange for the Pledged Capital Securities. In the
event the Collateral Agent receives such Debentures in respect of Pledged
Capital 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 (including, without
limitation, physical delivery thereof as set forth in Section
17
2.1) for Pledged Capital 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 Capital Securities as provided in Articles II, III, IV, V and VI
hereof, and any reference herein to the Pledged Capital 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 Property 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 Capital
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 Capital 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 Capital 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 Capital 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 Capital 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, Capital 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.
ARTICLE VII
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;
18
(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 2.1 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 2.1 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.
ARTICLE VIII
The Collateral Agent.
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. Each of the Collateral
Agent, the Custodial Agent and the Securities Intermediary: (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
19
against any of them, nor shall any of them 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, the Custodial Agent or the Securities Intermediary, as the
case may be) 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 in the
case of the Collateral Agent, 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, bad faith 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, the 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, the
Custodial Agent or the Securities Intermediary 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, the Custodial Agent or
the Securities Intermediary be liable for any amount in excess of the Value of
the Collateral. Notwithstanding the foregoing, the Collateral Agent, the
Custodial Agent, the Purchase Contract Agent and Securities Intermediary, each
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, the Custodial Agent or the Securities Intermediary, as the case may be,
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, the Custodial Agent or
the Securities Intermediary, as the case may be, 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, the Custodial Agent and
the Securities Intermediary 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, the Custodial Agent and the Collateral Agent shall be entitled
conclusively to rely upon any
20
certification, order, judgment, opinion, notice or other communication
(including, without limitation, any thereof by telephone 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, the Custodial Agent
or the Securities Intermediary, as the case may be. As to any matters not
expressly provided for by this Agreement, the Collateral Agent, the Custodial
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, the Custodial
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, any Holder of Securities and any
holder of Separate Capital Securities (and any of their respective subsidiaries
or affiliates) as if it were not acting as the Collateral Agent, the Custodial
Agent or the Securities Intermediary, as the case may be, and the Collateral
Agent, the Custodial Agent and the Securities Intermediary and their affiliates
may accept fees and other consideration from the Purchase Contract Agent, any
Holder of Securities or any holder of Separate Capital Securities without having
to account for the same to the Company; provided that each of the Securities
Intermediary, the Custodial Agent 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 and the Collateral shall not
be commingled with any other assets of any such Person.
Section 8.5 Non-Reliance on Collateral Agent. None of the Securities
Intermediary, the Custodial Agent or 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, the Custodial
Agent and the Securities Intermediary shall not have any duty or responsibility
to provide the Company or the Remarketing Agent with any credit or other
information concerning the affairs, financial condition or business of the
Purchase Contract Agent, any Holder of Securities or any holder of Separate
Capital Securities (or any of their respective subsidiaries or affiliates) that
may come into the possession of the Collateral Agent, the Custodial Agent or the
Securities Intermediary or any of their respective affiliates.
Section 8.6 Compensation and Indemnity. The Company agrees: (i) to pay each
of the Collateral Agent and the Custodial Agent from time to time such
compensation as shall be agreed in writing between the Company and the
Collateral Agent or the Custodial Agent, as the case may be, for all services
rendered by each of them hereunder and (ii) to indemnify the Collateral Agent,
the Custodial 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
21
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. The Collateral Agent, the Custodial Agent and the Securities
Intermediary shall each promptly notify the Company of any third party claim
which may give rise to the indemnity hereunder and give the Company the
opportunity to participate in the defense of such claim with counsel reasonably
satisfactory to the indemnified party, and no such claim shall be settled
without the written consent of the Company, which consent shall not be
unreasonably withheld.
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 and the Custodial 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 neither the Collateral Agent nor the Custodial
Agent shall 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 and the Custodial 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 the Custodial Agent, as the case may be,
or (ii) the Collateral Agent or the Custodial Agent, as the case may be, shall
have received security or an indemnity reasonably satisfactory to the Collateral
Agent or the Custodial Agent, as the case may be, sufficient to save the
Collateral Agent or the Custodial Agent, as the case may be, harmless from and
against any and all loss, liability or reasonable out-of-pocket expense which
the Collateral Agent or the Custodial Agent, as the case may be, may incur by
reason of its acting without bad faith, willful misconduct or gross negligence.
The Collateral Agent or the Custodial Agent may in addition elect to commence an
interpleader action or seek other judicial relief or orders as the Collateral
Agent or the Custodial Agent, as the case may be, may deem necessary.
Notwithstanding anything contained herein to the contrary, neither the
Collateral Agent nor the Custodial Agent shall 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 or Custodial Agent as provided below,
(a) the Collateral Agent and the Custodial 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 and the
Custodial Agent may be removed at any time by the Company and (c) if the
Collateral Agent or the Custodial 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 or the
Custodial Agent may be removed by the Purchase
22
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 or Custodial Agent, as the
case may be. If no successor Collateral Agent or Custodial Agent, as the case
may be, shall have been so appointed and shall have accepted such appointment
within 30 days after the retiring Collateral Agent's or Custodial Agent's giving
of notice of resignation or such removal, then the retiring Collateral Agent or
Custodial Agent, as the case may be, may petition any court of competent
jurisdiction for the appointment of a successor Collateral Agent or Custodial
Agent, as the case may be. Each of the Collateral Agent and the Custodial Agent
shall be a bank which has an office in New York, New York with a combined
capital and surplus of at least $50,000,000. Upon the acceptance of any
appointment as Collateral Agent or Custodial Agent, as the case may be,
hereunder by a successor Collateral Agent or Custodial Agent, as the case may
be, such successor shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Collateral Agent or
Custodial Agent, as the case may be, and the retiring Collateral Agent or
Custodial Agent, as the case may be, shall take all appropriate action to
transfer any money and property held by it hereunder (including the Collateral)
to such successor. The retiring Collateral Agent or Custodial Agent shall, upon
such succession, be discharged from its duties and obligations as Collateral
Agent or Custodial Agent hereunder. After any retiring Collateral Agent's or
Custodial Agent's resignation hereunder as Collateral Agent or Custodial Agent,
the provisions of this Section 8.8 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 or Custodial Agent. Any resignation or removal of the
Collateral Agent hereunder shall be deemed for all purposes of this Agreement as
the simultaneous resignation or removal of the Custodial Agent and the
Securities Intermediary.
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 Article 8 shall survive
termination of this Agreement and the resignation or removal of the Collateral
Agent or the Custodial Agent.
Section 8.11 Exculpation. Anything in this Agreement to the contrary
notwithstanding, in no event shall any of the Collateral Agent, the Custodial
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, the Custodial Agent or the Securities Intermediary, or any of them,
incurred without any act or deed that is found to be attributable to gross
negligence, bad faith or willful misconduct on the part of the Collateral Agent,
the Custodial Agent or the Securities Intermediary.
23
ARTICLE IX
Amendment.
Section 9.1 Amendment Without Consent of Holders. Without the consent of any
Holders or the holders of any Separate Capital Securities, the Company, the
Collateral Agent, the Custodial Agent, the Securities Intermediary 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, the
Custodial Agent, the Securities Intermediary 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, the Collateral Agent, the
Custodial Agent and the Securities Intermediary 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 Capital 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 Capital
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
24
(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, the Custodial Agent, the Securities
Intermediary 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 Article 9, 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.
ARTICLE X
Miscellaneous.
Section 10.1 No Waiver. No failure on the part of any party hereto 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 any party hereto or
any of its agents of any right, power or remedy hereunder preclude any other
25
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, the Custodial Agent, the Securities Intermediary
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
26
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 and the Custodial Agent for: (a) all reasonable out-of-pocket costs and
expenses of the Collateral Agent and the Custodial Agent (including, without
limitation, the reasonable fees and expenses of counsel to the Collateral Agent
and the Custodial 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.
27
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
XXX COMMUNICATIONS, INC.
By: /s/ Xxxxxx X. Xxxxxxx
Name: Xxxxxx X. Xxxxxxx
Title: Vice President and Treasurer
Address for Notices:
Xxx Communications, Inc.
0000 Xxxx Xxxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxx
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: /s/ Xxxxxx Xxx Xxxxxxx
Name: Xxxxxx Xxx Xxxxxxx
Title: Vice President
Address for Notices:
The First National Bank of Chicago
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, XX 00000-0000
Attention: Corporate Trust Services Division
Telecopy: (000) 000-0000
THE BANK OF NEW YORK, as Collateral Agent,
Custodial Agentand as Securities Intermediary
By: /s/ Xxxxx X. Xxxxxxxx
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Treasurer
28
Address for Notices:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
Telecopy: (000) 000-0000
29
EXHIBIT A
INSTRUCTION FROM PURCHASE CONTRACT AGENT TO COLLATERAL AGENT
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
Re: FELINE PRIDES of Xxx Communications, Inc.
(the "Company"), and Xxx Trust II
We hereby notify you in accordance with Section [4.1] [4.2] of the
Pledge Agreement, dated as of August 12, 1999, (the "Pledge Agreement") among
the Company, yourselves, as Collateral Agent, Custodial Agent and Securities
Intermediary 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 Capital Securities or the appropriate Applicable Ownership Interest of
the Treasury Portfolio] in exchange for an equal Value of [Pledged Capital
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] [Capital 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 Capital Securities or the appropriate Applicable Ownership
Interest of the Treasury Portfolio], to release the [Capital 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] [Capital Securities or the appropriate Applicable
Ownership Interest of the Treasury Portfolio] for the [Pledged Capital
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 Xxx Communications, Inc.
(the "Company"), and Xxx Trust II
The undersigned Holder hereby notifies you that it has delivered to The
Bank of New York, as Collateral Agent, [$_______ aggregate principal amount of
Treasury Securities] [$ aggregate Stated Amount of Capital Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio] in exchange
for an equal Value of [Pledged Capital Securities or the appropriate Applicable
Ownership Interest of the Treasury Portfolio] [Pledged Treasury Securities] held
by the Collateral Agent, in accordance with Section 4.1 of the Pledge Agreement,
dated August 12, 1999 (the "Pledge Agreement"), 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 Capital 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.
Date: _________________________
Signature Guarantee: _______________________
Please print name and address of Registered Holder:
-------------------------------- ---------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
--------------------------------
Address
--------------------------------
--------------------------------
EXHIBIT C
INSTRUCTION TO CUSTODIAL AGENT REGARDING REMARKETING
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
Re: Capital Securities of Xxx Communications, Inc.
(the "Company"), and Xxx Trust II
The undersigned hereby notifies you in accordance with Section 4.6(c)
of the Pledge Agreement, dated as of August 12, 1999 (the "Pledge Agreement"),
among the Company, yourselves, as Collateral Agent, Securities Intermediary and
Custodial Agent, and The First National Bank of Chicago, as Purchase Contract
Agent and as attorney-in-fact for the Holders of Income PRIDES and Growth PRIDES
from time to time, that the undersigned elects to deliver $__________ stated
liquidation amount of Capital Securities for delivery to the Remarketing Agent
on the fourth Business Day immediately preceding the Purchase Contract
Settlement Date for remarketing pursuant to Section 4.6(c) of the Pledge
Agreement. The undersigned will, upon request of the Remarketing Agent, execute
and deliver any additional documents deemed by the Remarketing Agent or by the
Company to be necessary or desirable to complete the sale, assignment and
transfer of the Capital Securities tendered hereby.
The undersigned hereby instructs you, upon receipt of the Proceeds of
such remarketing from the Remarketing Agent to deliver such Proceeds to the
undersigned in accordance with the instructions indicated herein under "A.
Payment Instructions." The undersigned hereby instructs you, in the event of
Failed Remarketing, upon receipt of the Capital Securities tendered herewith
from the Remarketing Agent, to be delivered to the person(s) and the address(es)
indicated herein under "B. Delivery Instructions."
With this notice, the undersigned hereby (i) represents and warrants
that the undersigned has full power and authority to tender, sell, assign and
transfer the Capital Securities tendered hereby and that the undersigned is the
record owner of any Capital Securities tendered herewith in physical form or a
participant in The Depositary Trust Company ("DTC") and the beneficial owner of
any Capital Securities tendered herewith by book-entry transfer to your account
at DTC and (ii) agrees to be bound by the terms and conditions of Section 4.6(c)
of the Pledge Agreement. 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:
-------------------------------- ---------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
--------------------------------
Address
--------------------------------
--------------------------------
A. PAYMENT INSTRUCTIONS
Proceeds of the remarketing should be paid by check in the name of the person(s)
set forth below and mailed to the address set forth below.
Name(s)_____________________________
(Please Print)
Address ____________________________
(Please Print)
------------------------------------
------------------------------------
(Zip Code)
------------------------------------
(Tax Identification or Social Security Number)
B. DELIVERY INSTRUCTIONS
In the event of a Failed Remarketing, Capital Securities which are in physical
form should be delivered to the person(s) set forth below and mailed to the
address set forth below.
Name(s)_____________________________
(Please Print)
Address ____________________________
(Please Print)
------------------------------------
------------------------------------
(Zip Code)
------------------------------------
(Tax Identification or Social Security Number)
In the event of a Failed Remarketing, Capital Securities which are in book-entry
form should be credited to the account at The Depositary Trust Company set forth
below.
-----------------------
DTC Account Number
Name of Account Party:
------------------------
EXHIBIT D
INSTRUCTION TO CUSTODIAL AGENT REGARDING
WITHDRAWAL FROM REMARKETING
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration
Re: Capital Securities of Xxx Communications, Inc.
(the "Company"), and Xxx Trust II
The undersigned hereby notifies you in accordance with Section 4.6(c)
of the Pledge Agreement, dated as of August 12, 1999 (the "Pledge Agreement")
among the Company, yourselves, as Collateral Agent, Securities Intermediary and
Custodial Agent and The First National Bank of Chicago, as Purchase Contract
Agent and as attorney-in-fact for the Holders of Income PRIDES and Growth PRIDES
from time to time, that the undersigned elects to withdraw the $_____ aggregate
stated liquidation amount of Capital Securities delivered to the Custodial Agent
on ___________, 2002 for remarketing pursuant to Section 4.6(c) of the Pledge
Agreement. The undersigned hereby instructs you to return such Capital
Securities to the undersigned in accordance with the undersigned's instructions.
With this notice, the Undersigned hereby agrees to be bound by the terms and
conditions of Section 4.6(c) of the Pledge Agreement. Capitalized terms used
herein but not defined shall have the meaning set forth in the Pledge Agreement.
Date:
--------------------
By:
----------------------
Name:
----------------------
Title:
----------------------
Signature Guarantee:
-----------------
-------------------------------- ---------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
--------------------------------
Address
--------------------------------
--------------------------------
A. DELIVERY INSTRUCTIONS
In the event of a Failed Remarketing, Capital Securities which are in physical
form should be delivered to the person(s) set forth below and mailed to the
address set forth below.
Name(s)_____________________________
(Please Print)
Address ____________________________
(Please Print)
------------------------------------
------------------------------------
(Zip Code)
------------------------------------
(Tax Identification or Social Security Number)
In the event of a Failed Remarketing, Capital Securities which are in book-entry
form should be credited to the account at The Depositary Trust Company set forth
below.
-----------------------
DTC Account Number
Name of Account Party:
------------------------
