Exhibit 4.1
TOYS "R" US, INC.
AND
THE BANK OF NEW YORK
as Purchase Contract Agent
PURCHASE CONTRACT AGREEMENT
Dated as of May 28, 2002
TABLE OF CONTENTS
Page
Article 1 DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION..............................................1
Section 1.1 Definitions................................................................................1
Section 1.2 Compliance Certificates and Opinions......................................................14
Section 1.3 Form of Documents Delivered to Agent......................................................15
Section 1.4 Acts of Holders; Record Dates.............................................................15
Section 1.5 Notices. ...............................................................................17
Section 1.6 Notice to Holders; Waiver.................................................................17
Section 1.7 Effect of Headings and Table of Contents..................................................18
Section 1.8 Successors and Assigns....................................................................18
Section 1.9 Separability Clause.......................................................................18
Section 1.10 Benefits of Agreement.....................................................................18
Section 1.11 Governing Law.............................................................................18
Section 1.12 Legal Holidays............................................................................18
Section 1.13 Counterparts..............................................................................19
Section 1.14 Inspection of Agreement...................................................................19
Article 2 CERTIFICATE FORMS...................................................................................19
Section 2.1 Forms of Certificates Generally...........................................................19
Section 2.2 Form of Agent's Certificate of Authentication.............................................20
Article 3 THE UNITS...........................................................................................21
Section 3.1 Title and Terms; Denominations............................................................21
Section 3.2 Rights and Obligations Evidenced by the Certificates......................................21
Section 3.3 Execution, Authentication, Delivery and Dating............................................22
Section 3.4 Temporary Certificates....................................................................22
Section 3.5 Registration; Registration of Transfer and Exchange.......................................23
Section 3.6 Book-Entry Interests......................................................................25
Section 3.7 Notices to Holders........................................................................25
Section 3.8 Appointment of Successor Clearing Agency..................................................25
Section 3.9 Definitive Certificates...................................................................26
Section 3.10 Mutilated, Destroyed, Lost and Stolen Certificates........................................26
Section 3.11 Persons Deemed Owners.....................................................................27
Section 3.12 Cancellation..............................................................................28
Section 3.13 Collateral Substitution and the Establishment of Stripped Units...........................28
Section 3.14 Reestablishment of Normal Units...........................................................30
Section 3.15 Transfer of Collateral upon Occurrence of Termination Event...............................32
Section 3.16 No Consent to Assumption..................................................................32
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Article 4 THE NOTES...........................................................................................32
Section 4.1 Payment of Interest; Rights to Interest Payments Preserved; Notice........................32
Section 4.2 Notice and Voting.........................................................................33
Section 4.3 Tax Event Redemption......................................................................34
Article 5 THE PURCHASE CONTRACTS; THE REMARKETING.............................................................35
Section 5.1 Purchase of Shares of Common Stock........................................................35
Section 5.2 Reserved..................................................................................36
Section 5.3 Reserved..................................................................................36
Section 5.4 Payment of Purchase Price; Remarketing....................................................37
Section 5.5 Issuance of Shares of Common Stock........................................................43
Section 5.6 Adjustment of Settlement Rate.............................................................43
Section 5.7 Notice of Adjustments and Certain Other Events............................................49
Section 5.8 Termination Event; Notice.................................................................50
Section 5.9 Early Settlement..........................................................................50
Section 5.10 Early Settlement Upon Merger..............................................................52
Section 5.11 Charges and Taxes.........................................................................53
Section 5.12 No Fractional Shares......................................................................54
Article 6 REMEDIES............................................................................................54
Section 6.1 Unconditional Right of Holders to Purchase Common Stock...................................54
Section 6.2 Restoration of Rights and Remedies........................................................54
Section 6.3 Rights and Remedies Cumulative............................................................54
Section 6.4 Delay or Omission Not Waiver..............................................................55
Section 6.5 Undertaking for Costs.....................................................................55
Section 6.6 Waiver of Stay or Extension Laws..........................................................55
Article 7 THE AGENT...........................................................................................55
Section 7.1 Certain Duties, Rights and Immunities.....................................................55
Section 7.2 Notice of Default.........................................................................57
Section 7.3 Certain Rights of Agent...................................................................58
Section 7.4 Not Responsible for Recitals, Etc.........................................................58
Section 7.5 May Hold Units and Other Dealings.........................................................59
Section 7.6 Money Held In Custody.....................................................................59
Section 7.7 Compensation and Reimbursement............................................................59
Section 7.8 Corporate Agent Required; Eligibility.....................................................60
Section 7.9 Resignation and Removal; Appointment of Successor.........................................60
Section 7.10 Acceptance of Appointment by Successor....................................................61
Section 7.11 Merger, Conversion, Consolidation or Succession to Business...............................62
Section 7.12 Preservation of Information; Communications to Holders....................................62
Section 7.13 Failure to Act............................................................................63
Section 7.14 No Obligations of Agent...................................................................63
Section 7.15 Tax Compliance............................................................................63
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Article 8 SUPPLEMENTAL AGREEMENTS.............................................................................64
Section 8.1 Supplemental Agreements Without Consent of Holders........................................64
Section 8.2 Supplemental Agreements With Consent of Holders...........................................64
Section 8.3 Execution of Supplemental Agreements......................................................65
Section 8.4 Effect of Supplemental Agreements.........................................................66
Section 8.5 Reference to Supplemental Agreements......................................................66
Article 9 CONSOLIDATION, MERGER, SALE OR CONVEYANCE...........................................................66
Section 9.1 Covenant Not to Merge, Consolidate, Sell or Convey Assets Except Under Certain
Conditions................................................................................66
Section 9.2 Rights and Duties of Successor Corporation................................................67
Article 10 COVENANTS..........................................................................................67
Section 10.1 Performance Under Purchase Contracts......................................................67
Section 10.2 Maintenance of Office or Agency...........................................................67
Section 10.3 Company to Reserve Common Stock...........................................................68
Section 10.4 Covenants as to Common Stock..............................................................68
Section 10.5 Statements of Officer of the Company as to Default........................................68
Section 10.6 Tax Treatment.............................................................................68
EXHIBIT A FORM OF NORMAL UNITS CERTIFICATE....................................................................A-1
EXHIBIT B FORM OF STRIPPED UNITS CERTIFICATE..................................................................B-1
EXHIBIT C INSTRUCTION FROM PURCHASE CONTRACT AGENT TO COLLATERAL AGENT........................................C-1
EXHIBIT D INSTRUCTION FROM HOLDER TO PURCHASE CONTRACT AGENT..................................................D-1
EXHIBIT E NOTICE TO SETTLE BY CASH............................................................................E-1
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PURCHASE CONTRACT AGREEMENT, dated as of May 28, 2002, between
Toys "R" Us, Inc., a Delaware corporation (the "Company"), and The Bank of New
York, a New York banking corporation, acting as purchase contract agent for the
Holders of Units from time to time (the "Agent").
RECITALS
The Company has duly authorized the execution and delivery of
this Agreement and the Certificates evidencing the Units.
All things necessary to make the Purchase Contracts, when the
Certificates are executed by the Company and authenticated, executed on behalf
of the Holders and delivered by the Agent, as provided in this Agreement, the
valid obligations of the Company, and to constitute this Agreement a valid
agreement of the Company, in accordance with its terms, have been done.
WITNESSETH:
For and in consideration of the premises and the purchase of
the Units by the Holders thereof, it is mutually agreed as follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
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, and nouns and pronouns of the masculine gender include the
feminine and neuter genders;
(b) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles in the United States;
(c) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Agreement as a whole and not to
any particular Article, Section or other subdivision; and
(d) the following terms have the meanings given to them in
this Section 1.1(d):
"Act" when used with respect to any Holder, has the meaning
specified in Section 1.4.
"Affiliate" has the same meaning as given to that term in Rule
405 of Regulation C under the Securities Act or any successor rule.
"Agent" means the Person named as the "Agent" in the first
paragraph of this instrument until a successor Agent shall have become such
pursuant to the applicable provisions of this Agreement, and thereafter "Agent"
shall mean such Person.
"Agent-purchased Treasury Consideration" has the meaning
specified in Section 5.4(b)(i).
"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 Market Value" has the meaning specified in Section
5.1.
"Applicable Ownership Interest" means, with respect to a
Normal Unit and the U.S. Treasury securities in the Treasury Portfolio, (A) a
1/20, or 5.0%, 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 prior to the Stock Purchase
Date and (B) for the scheduled interest Payment Date on the Notes that occurs on
the Stock Purchase Date, in the case of a successful remarketing that occurs
prior to the third Business Day immediately preceding the Stock Purchase Date,
or for each scheduled interest Payment Date on the Notes that occurs after the
Tax Event Redemption Date and on or before the Stock Purchase Date, in the case
of a Tax Event Redemption, a 0.078125% undivided beneficial ownership interest
in a $1,000 principal or interest amount of a principal or interest strip in a
U.S. Treasury security included in the Treasury Portfolio that matures on or
prior to that interest Payment Date or Dates.
"Applicable Principal Amount" means the aggregate principal
amount of the Notes that are components of Normal Units on the Initial
Remarketing Date or any Subsequent Remarketing Date that occurs prior to the
third Business Day preceding the Stock Purchase Date and that are to be included
in any remarketing.
"Applicants" has the meaning specified in Section 7.12(b).
"Bankruptcy Code" means Title 11 of the United States Code, or
any other law of the United States that from time to time provides a uniform
system of bankruptcy laws.
"Beneficial Owner" means, with respect to a Book-Entry
Interest, a Person who is the beneficial owner of such Book-Entry Interest as
reflected on the books of the Clearing Agency or on the books of a Person
maintaining an account with such Clearing Agency (directly as a Clearing Agency
Participant or as an indirect participant, in each case in accordance with the
rules of such Clearing Agency).
"Board of Directors" means either the Board of Directors of
the Company or the Executive Committee of such Board or any other committee of
such Board duly authorized to act generally or in any particular respect for
such Board hereunder.
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"Board Resolution" means (i) a copy of a resolution certified
by the Secretary or the Assistant Secretary of the Company to have been duly
adopted by the Board of Directors and to be in full force and effect on the date
of such certification, (ii) a copy of a unanimous written consent of the Board
of Directors or (iii) a certificate signed by the authorized officer or officers
to whom the Board of Directors has delegated its authority, and in each case,
delivered to the Agent.
"Book-Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 3.6.
"Business Day" means any day other than a Saturday, Sunday or
any other day on which banking institutions and trust companies in The State of
New York or at a place of payment are authorized or required by law, regulation
or executive order to be closed.
"Capital Stock" means any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of or interests
in (however designated, whether voting or non-voting) corporate stock or similar
interests in other types of entities.
"Cash" means any coin or currency of the United States as at
the time shall be legal for payment of public and private debts.
"Cash Merger" has the meaning set forth in Section 5.10.
"Cash Settlement" has the meaning set forth in Section 5.4(a).
"Certificate" means a Normal Units Certificate or a Stripped
Units Certificate.
"Clearing Agency" means an organization registered as a
"Clearing Agency" pursuant to Section 17A of the Exchange Act that is acting as
a depositary for the Units and in whose name, or in the name of a nominee of
that organization, shall be registered a Global Certificate and which shall
undertake to effect book-entry transfers and pledges of the Units.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time the
Clearing Agency effects book-entry transfers and pledges of securities deposited
with the Clearing Agency.
"Closing Price" has the meaning specified in Section 5.1.
"Collateral" has the meaning specified in Section 2.1 of the
Pledge Agreement.
"Collateral Agent" means JPMorgan Chase Bank, a New York
banking corporation, as Collateral Agent under the Pledge Agreement until a
successor Collateral Agent shall have become such pursuant to the applicable
provisions of the Pledge Agreement, and thereafter "Collateral Agent" shall mean
the Person who is then the Collateral Agent thereunder.
"Collateral Substitution" has the meaning specified in Section
3.13.
3
"Common Stock" means the Common Stock, par value $.10 per
share, of the Company.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such pursuant
to the applicable provision of this Agreement, and thereafter "Company" shall
mean such successor.
"Constituent Person" has the meaning specified in Section
5.6(b).
"Corporate Trust Office" means the office of the Agent at
which, at any particular time, its corporate trust business shall be principally
administered, which office at the date hereof is located at 000 Xxxxxxx Xxxxxx,
Xxxxx 21 West, New York, New York, 10286, Attention: Corporate Trust
Administration, or such other address as the Trustee may designate from time to
time by notice to the Holders and the Company, or the principal corporate trust
office of any successor Trustee (or such other address is such successor Trustee
may designate from time to time by notice to the Holders and the Company).
"Coupon Rate" means the percentage rate per annum at which
each Note will bear interest initially.
"Current Market Price" has the meaning specified in Section
5.6(a)(8).
"Custodial Agent" means JPMorgan Chase Bank, a New York
banking corporation, as Custodial Agent under the Pledge Agreement until a
successor Custodial Agent shall have become such pursuant to the applicable
provisions of the Pledge Agreement, and thereafter "Custodial Agent" shall mean
the Person who is then the Custodial Agent thereunder.
"Depositary" means, initially, DTC, until another Clearing
Agency becomes its successor.
"DTC" means The Depository Trust Company, the initial Clearing
Agency.
"Early Settlement" has the meaning specified in Section
5.9(a).
"Early Settlement Amount" has the meaning specified in Section
5.9(a).
"Early Settlement Date" has the meaning specified in Section
5.9(a).
"Early Settlement Rate" has the meaning specified in Section
5.9(b).
"Exchange Act" means the Securities Exchange Act of 1934 and
any successor statute thereto, in each case as amended from time to time, and
the rules and regulations promulgated thereunder.
"Expiration Date" has the meaning specified in Section 1.4.
"Expiration Time" has the meaning specified in Section
5.6(a)(6).
4
"Fair Market Value" with respect to securities distributed in
a Spin-Off means (a) in the case of any Spin-Off that is effected simultaneously
with an initial public offering of such securities, the initial public offering
price of those securities, and (b) in the case of any other Spin-Off, the
average of the Sale Prices of those securities over the first 10 Trading Days
after the effective date of such Spin-Off.
"First Supplemental Indenture" means the First Supplemental
Indenture dated as of May 28, 2002, between the Company and the Trustee relating
to the Notes, as modified, amended or supplemented pursuant to the terms
thereto.
"Global Certificate" means a Certificate that evidences all or
part of the Units and is registered in the name of a Depositary or a nominee
thereof.
"Holder" means the Person in whose name the Units evidenced by
a Normal Units Certificate and/or a Stripped Units Certificate is registered in
the related Normal Units Register and/or the Stripped Units Register, as the
case may be.
"Indenture" means the Indenture dated as of May 28, 2002,
between the Company and the Trustee, as supplemented by the First Supplemental
Indenture.
"Initial Remarketing Date" means the date of the initial
remarketing, which shall occur on the third Business Day immediately preceding
May 16, 2005.
"Issuer Order" or "Issuer Request" means a written order or
request signed in the name of the Company by the Chief Executive Officer, the
Chief Financial Officer, the President, any Vice-President, the Treasurer, any
Assistant Treasurer, the Secretary or any Assistant Secretary (or other officer
performing similar functions) of the Company and delivered to the Agent.
"Last Failed Remarketing" has the meaning specified in Section
5.4(b)(ii).
"Merger Early Settlement" has the meaning specified in Section
5.10.
"Merger Early Settlement Amount" has the meaning specified in
Section 5.10.
"Merger Early Settlement Date" has the meaning specified in
Section 5.10.
"Non-electing Share" has the meaning specified in Section
5.6(b).
"Normal Unit" means the collective rights and obligations of a
Holder of a Normal Units Certificate in respect of a Note or the Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, subject in
each case to the Pledge thereof, and the related Purchase Contract.
"Normal Units Certificate" means a certificate evidencing the
rights and obligations of a Holder in respect of the number of Normal Units
specified on such certificate, substantially in the form of Exhibit A hereto.
5
"Normal Units Register" and "Normal Units Registrar" have the
respective meanings specified in Section 3.5.
"Notes" means the series of senior debt securities of the
Company designated the Senior Notes due 2007, to be issued under the Indenture.
"NYSE" has the meaning specified in Section 5.1.
"Officer's Certificate" means a certificate signed by the
Chief Executive Officer, the Chief Financial Officer, the President, any Vice-
President, the Treasurer, any Assistant Treasurer, the Secretary or any
Assistant Secretary (or other officer performing similar functions) of the
Company and delivered to the Agent.
"Opinion of Counsel" means an opinion in writing signed by
legal counsel, who may be an employee of or counsel to the Company and who shall
be reasonably acceptable to the Agent.
"Opt-out Treasury Consideration" has the meaning specified in
Section 5.4(b)(v).
"Outstanding Units" means, as of the date of determination,
all Normal Units or Stripped Units evidenced by Certificates theretofore
authenticated, executed and delivered under this Agreement, except:
(i) If a Termination Event has occurred, (A) Stripped
Units for which the related Treasury Securities have been
theretofore deposited with the Collateral Agent in trust for
the Holders of such Stripped Units and (B) Normal Units for
which the related Notes or the Applicable Ownership Interest
in the Treasury Portfolio, as the case may be, theretofore
deposited with the Collateral Agent in trust for the Holders
of such Normal Units;
(ii) Normal Units and Stripped Units evidenced by
Certificates theretofore cancelled by the Agent or delivered
to the Agent for cancellation or deemed cancelled pursuant to
the provisions of this Agreement; and
(iii) Normal Units or Stripped Units evidenced by
Certificates in exchange for or in lieu of which other
Certificates have been authenticated, executed on behalf of
the Holder and delivered pursuant to this Agreement, other
than any such Certificate in respect of which there shall have
been presented to the Agent proof satisfactory to it that such
Certificate is held by a bona fide purchaser in whose hands
the Normal Units or Stripped Units evidenced by such
Certificate are valid obligations of the Company;
provided, that in determining whether the Holders of the requisite number of the
Normal Units or Stripped Units have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Normal Units or Stripped Units
owned by the Company or any Affiliate of the Company shall be disregarded and
deemed not to be outstanding, except that, in determining whether the Agent
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Normal Units or Stripped Units which
a Responsible Officer of the Agent knows to be so owned shall be so disregarded.
Normal Units or Stripped Units so owned which have been pledged in good faith
may be regarded as Outstanding Units if the pledgee establishes to the
satisfaction of the Agent the pledgee's right so to act with respect to such
Normal Units or Stripped Units and that the pledgee is not the Company or any
Affiliate of the Company.
6
"Payment Date" means each February 16, May 16, August 16 and
November 16, commencing August 16, 2002. The amount of the first interest
payment will be prorated to reflect the interest accrued between the initial
issuance date of the Normal Units and August 16, 2002.
"Permitted Investments" means any one of the following which
shall mature not later than the third Business Day prior to the Stock Purchase
Date (i) any evidence of indebtedness with an original maturity of 365 days or
less issued, or directly and fully guaranteed or insured, by the United States
of America or any agency or instrumentality thereof (provided that the full
faith and credit of the United States of America is pledged in support thereof
or such indebtedness constitutes a general obligation of it); (ii) deposits,
certificates of deposit or acceptances with an original maturity of 365 days or
less of any institution which is a member of the Federal Reserve System having
combined capital and surplus and undivided profits of not less than US $200.0
million at the time of deposit; (iii) investments with an original maturity of
365 days or less of any Person that is fully and unconditionally guaranteed by a
bank referred to in clause (ii); (iv) 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, 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" means the pledge under the Pledge Agreement of the
Notes, the Treasury Securities or the Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, in each case, constituting a part of the
Units, property, cash, securities, financial assets and security entitlements of
the Collateral Account (as defined in the Pledge Agreement) and any Proceeds of
any of the foregoing pursuant to the Pledge Agreement.
"Pledge Agreement" means the Pledge Agreement, dated as of the
date hereof, by and among the Company, the Collateral Agent, the Custodial
Agent, the Securities Intermediary and the Agent, on its own behalf and as
attorney-in-fact for the Holders from time to time of the Units, as modified,
amended, or supplemented pursuant to the terms thereto.
"Pledged Applicable Ownership Interest in the Treasury
Portfolio" has the meaning set forth in Section 2.1(d) of the Pledge Agreement.
7
"Pledged Notes" has the meaning set forth in Section 2.1(d) of
the Pledge Agreement.
"Pledged Treasury Securities" has the meaning set forth in
Section 2.1(d) of the Pledge Agreement.
"Predecessor Certificate" means a Predecessor Normal Units
Certificate or a Predecessor Stripped Units Certificate.
"Predecessor Normal Units Certificate" of any particular
Normal Units Certificate means every previous Normal Units Certificate
evidencing all or a portion of the rights and obligations of the Company and the
Holder under the Normal Units evidenced thereby; and, for the purposes of this
definition, any Normal Units Certificate authenticated and delivered under
Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Normal Units Certificate shall be deemed to evidence the same rights and
obligations of the Company and the Holder as the mutilated, destroyed, lost or
stolen Normal Units Certificate.
"Predecessor Stripped Units Certificate" of any particular
Stripped Units Certificate means every previous Stripped Units Certificate
evidencing all or a portion of the rights and obligations of the Company and the
Holder under the Stripped Units evidenced thereby; and, for the purposes of this
definition, any Stripped Units Certificate authenticated and delivered under
Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Stripped Units Certificate shall be deemed to evidence the same rights
and obligations of the Company and the Holder as the mutilated, destroyed, lost
or stolen Stripped Units Certificate.
"Primary Treasury Dealer" means a primary U.S. government
securities dealer in The City of New York.
"Principal Amount" means as to any one Note, $50.
"Proceeds" means all interest, dividends, cash, instruments,
securities, financial assets (as defined in ss. 8-102(a)(9) of the Uniform
Commercial Code (or any successor thereto) in effect in the State of New York
from time to time) and other property from time to time received, receivable or
otherwise distributed upon the sale, exchange, maturity, collection or
disposition of the Collateral or any proceeds thereof.
"Purchase Contract," when used with respect to any Unit, means
the contract forming a part of such Unit and obligating the Company to sell and
the Holder of such Unit to purchase Common Stock on the terms and subject to the
conditions set forth in Article V.
"Purchase Contract Settlement Fund" has the meaning specified
in Section 5.5.
"Purchase Price" has the meaning specified in Section 5.1.
"Purchased Shares" has the meaning specified in Section
5.6(a)(6).
8
"Quotation Agent" means Credit Suisse First Boston
Corporationor Xxxxxxx Xxxxx Xxxxxx Inc., or a successor of either or any other
Primary Treasury Dealer selected by the Company.
"Record Date" for the distribution payable on any Payment Date
means the 15th day preceding such Payment Date.
"Redemption Price" means the redemption price per Note equal
to the Tax Event Redemption Principal Amount plus any accrued and unpaid
interest on such Note to but excluding the Tax Event Redemption Date.
"Register" means the Normal Units Register and the Stripped
Units Register, as applicable.
"Registrar" means the Normal Units Registrar and the Stripped
Units Registrar, as applicable.
"Remarketing Agent" has the meaning specified in Section
5.4(b)(i).
"Remarketing Agreement" means the Remarketing Agreement to be
entered into by and among the Company and the Remarketing Agent, as modified,
amended or supplemented pursuant to the terms thereto.
"Remarketing Date" means the Initial Remarketing Date and any
Subsequent Remarketing Date.
"Remarketing Fee" has the meaning specified in Section
5.4(b)(i).
"Remarketing Notice" has the meaning specified in Section
5.4(b).
"Remarketing Period" means the Initial Remarketing Date and
any Subsequent Remarketing Period.
"Remarketing Settlement Date" means, after a successful
remarketing, if any, the date on which the settlement of such remarketing
occurs.
"Remarketing Value" means:
(a) in the case of a remarketing that occurs on the third
Business Day prior to the Stock Purchase Date, the value at that Remarketing
Date of an amount of Cash equal to $50 for each Note which is included in a
Normal Unit and each Separate Note that, in each case, is participating in the
remarketing; and
(b) in all other cases, the sum of:
(i) the value at the Remarketing Date of such amount
of U.S. Treasury securities that will pay, prior to the
quarterly Payment Date falling on the Stock Purchase Date, an
amount of Cash equal to the aggregate interest payments that
are scheduled to be payable on that quarterly Payment Date on
all Notes which are included in Normal Units and the Separate
Notes which, in each case, are participating in the
remarketing, assuming for this purpose, even if not true, that
the interest rate on the Notes remains the Coupon Rate; and
9
(ii) the value at the Remarketing Date of such amount
of U.S. Treasury securities that will pay, prior to the Stock
Purchase Date, an amount of Cash equal to the Principal Amount
of each Note which is included in a Normal Unit and each
Separate Note, in each case, that is participating in the
remarketing,
provided that for purposes of clause (b) above, the Remarketing Value shall be
calculated on the assumptions that (x) the U.S. Treasury securities are highly
liquid and mature on or within 35 days prior to the Stock Purchase Date, as
determined in good faith by the Remarketing Agent in a manner intended to
minimize the cash value of the U.S. Treasury securities, and (y) the U.S.
Treasury securities are valued based on the ask-side price of the U.S. Treasury
securities at a time between 9:00 a.m. and 11:00 a.m. (New York City time)
selected by the Remarketing Agent, on the Initial Remarketing Date or any
Subsequent Remarketing Date, as the case may be, as determined on a third-day
settlement basis by a reasonable and customary means selected in good faith by
the Remarketing Agent, plus accrued interest to that date, provided, further,
that if the assumptions specified in this definition are not correct with
respect to a remarketing that occurs during the Subsequent Remarketing Period
that ends on the third Business Day prior to the Stock Purchase Date, then the
Remarketing Agent shall have the option to raise the Remarketing Value specified
above in Cash (rather than U.S. Treasury securities), in which event all
references to Agent-purchased Treasury Consideration shall mean such Cash.
"Reorganization Event" has the meaning specified in Section
5.6(b).
"Reset Rate" has the meaning specified in Section 5.4(b)(i).
"Responsible Officer" means, when used with respect to the
Agent, any officer within the corporate trust department of the Agent (or any
successor of the Agent), including any Vice President, any assistant Vice
President, any assistant secretary, any assistant treasurer, any trust officer,
any senior trust officer or any other officer of the Agent who customarily
performs functions similar to those performed by the Persons who at the time
shall be such officers, respectively, or to whom any corporate trust matter is
referred because of such Person's knowledge of and familiarity with the
particular subject and who, in each of the above cases, shall have direct
responsibility for the administration of this Agreement.
"Sale Price" of the Common Stock or any securities distributed
in a Spin-Off, as the case may be, on any Trading Day means the closing sale
price per share (or if no closing sale price is reported, the average of the bid
and ask prices or, if more than one in either case, the average of the average
bid and the average asked prices) on such Trading Day as reported in composite
transactions for the principal U.S. securities exchange on which the Common
Stock or such securities are traded or, if the Common Stock or such securities
are not listed on a U.S. national or regional securities exchange, as reported
by Nasdaq.
10
"Securities Act" means the Securities Act of 1933 and any
successor statute thereto, in each case as amended from time to time, and the
rules and regulations promulgated thereunder.
"Securities Intermediary" means JPMorgan Chase Bank, a New
York banking corporation, in its capacity as Securities Intermediary under the
Pledge Agreement, together with its successors in such capacity.
"Separate Notes" has the meaning set forth in the Pledge
Agreement.
"Settlement Date" means any Early Settlement Date or Merger
Early Settlement Date or the Stock Purchase Date.
"Settlement Rate" has the meaning specified in Section 5.1.
"Spin-Off" means a dividend or other distribution of shares of
Capital Stock of any class or series, or similar equity interests, of or
relating to a subsidiary or other business unit of the Company.
"Stated Amount" means, with respect to any one Normal Unit or
Stripped Unit, $50.
"Stock Purchase Date" means August 16, 2005.
"Stripped Unit" means the collective rights and obligations of
a holder of a Stripped Units Certificate in respect of a 1/20, or 5.0%,
undivided beneficial interest in a Treasury Security, subject in each case to
the Pledge thereof, and the related Purchase Contract.
"Stripped Units Certificate" means a certificate evidencing
the rights and obligations of a Holder in respect of the number of Stripped
Units specified on such certificate, substantially in the form of Exhibit B
hereto.
"Stripped Units Register" and "Stripped Units Registrar" have
the respective meanings specified in Section 3.5.
"Subsequent Remarketing Date" means the date, if any, on which
the Remarketing Agent establishes the Reset Rate during a Subsequent Remarketing
Period.
"Subsequent Remarketing Period" has the meaning specified in
Section 5.4(b)(ii).
"Tax Event" means the receipt by the Company of an opinion of
a nationally recognized tax counsel experienced in such matters, to the effect
that there is more than an insubstantial risk that interest payable by the
Company on the Notes would not be deductible, in whole or in part, by the
Company for United States Federal income tax purposes, as a result of (a) any
amendment to, or change (including any announced proposed change) in, the laws
(or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein affecting taxation, (b) any
amendment to or change in an official interpretation or application of such laws
or regulations by any legislative body, court, governmental agency or regulatory
authority or (c) any official interpretation or pronouncement that provides for
a position with respect to such laws or regulations that differs from the
generally accepted position on May 28, 2002, which amendment, change or proposed
change is effective or which interpretation or pronouncement is announced on or
after May 28, 2002.
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"Tax Event Redemption" means, if a Tax Event shall occur, the
redemption of the Notes, at the option of the Company, in whole but not in part,
on not less than 30 days nor more than 60 days' written notice.
"Tax Event Redemption Date" means the date upon which a Tax
Event Redemption is to occur.
"Tax Event Redemption Principal Amount" means in the case of a
Tax Event Redemption occurring prior to a successful remarketing of the Notes,
for each Note the product of the Principal Amount of the Note and a fraction
whose numerator is the Treasury Portfolio Purchase Price and whose denominator
is the aggregate Principal Amount of Notes outstanding on such Tax Event
Redemption Date, and in the case of a Tax Event Redemption Date occurring after
a successful remarketing of the Notes means, for each Note, the Principal Amount
of the Note outstanding on such Tax Event Redemption Date.
"Terminated Remarketing Period" has the meaning specified in
Section 5.4(b)(ii).
"Termination Date" means the date, if any, on which a
Termination Event occurs.
"Termination Event" means the occurrence of any of the
following events:
(i) at any time on or prior to the Stock Purchase
Date, a judgment, decree or court order shall have been
entered granting relief under the Bankruptcy Code or any other
similar Federal or state law, adjudicating the Company to be
insolvent, or approving as properly filed a petition seeking
reorganization or liquidation of the Company, and, unless such
judgment, decree or order shall have been entered within 60
days prior to the Stock Purchase Date, such decree or order
shall have continued undischarged and unstayed for a period of
60 days;
(ii) at any time on or prior to the Stock Purchase
Date, a judgment, decree or court order for the appointment of
a receiver or liquidator or trustee or assignee in bankruptcy
or insolvency of the Company or of its property, or for the
winding up or liquidation of its affairs, shall have been
entered, and, unless such judgment, decree or order shall have
been entered within 60 days prior to the Stock Purchase Date,
such judgment, decree or order shall have continued
undischarged and unstayed for a period of 60 days; or
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(iii) at any time on or prior to the Stock Purchase
Date the Company shall file a petition for relief under the
Bankruptcy Code or any other similar Federal or state law, or
shall consent to the filing of a bankruptcy proceeding against
it, or shall file a petition or answer or consent seeking
reorganization or liquidation under the Bankruptcy Code or any
other similar Federal or state law, or shall consent to the
filing of any such petition, or shall consent to the
appointment of a receiver or liquidator or trustee or assignee
in bankruptcy or insolvency of it or of its property, or shall
make an assignment for the benefit of creditors, or shall
admit in writing its inability to pay its debts generally as
they become due.
"Threshold Appreciation Price" has the meaning specified in
Section 5.1.
"TIA" means the Trust Indenture Act of 1939 and any statute
successor thereto, in each case as amended from time to time, and the rules and
regulations promulgated thereunder.
"Trading Day" has the meaning specified in Section 5.1.
"Transaction Documents" has the meaning specified in Section
7.1(a).
"Treasury Portfolio" means:
(i) in connection with the Initial Remarketing Date
or any Subsequent Remarketing that occurs prior to the third
Business Day immediately preceding the Stock Purchase Date,
means a portfolio of zero-coupon U.S. Treasury securities
consisting of (x) principal or interest strips of U.S.
Treasury securities that mature prior to August 16, 2005 in an
aggregate amount equal to the Applicable Principal Amount, (y)
with respect to the scheduled interest payment date on the
Notes that occurs on the Stock Purchase Date, principal or
interest strips of U.S. Treasury securities that mature prior
to such date in an aggregate amount equal to the aggregate
interest payment that would be due on the Applicable Principal
Amount of the Notes on such date if the applicable Coupon Rate
on the Notes were not reset to the Reset Rate as set forth in
Section 5.4 hereof and (z) the aggregate amount of Opt-out
Treasury Consideration, if any, existing at the date of
determination of this definition; and
(ii) in connection with a Tax Event Redemption Date
that occurs prior to a successful remarketing of the Notes, a
portfolio of zero-coupon U.S. Treasury securities consisting
of (x) principal or interest strips of U.S. Treasury
securities that mature prior to the Stock Purchase Date in an
aggregate amount equal to the applicable Tax Event Redemption
Principal Amount and (y) with respect to each scheduled
interest payment date on the Notes that occurs after the Tax
Event Redemption Date and on or before the Stock Purchase
Date, principal or interest strips of U.S. Treasury securities
that mature on or prior to such date in an aggregate amount
equal to the aggregate interest payment that would be due on
the applicable Tax Event Redemption Principal Amount of the
Notes on such date.
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"Treasury Portfolio Purchase Price" means the lowest aggregate
price quoted by the Primary Treasury Dealer to the Quotation Agent:
(i) in the case of a Tax Event Redemption occurring
on the third Business Day immediately preceding the Tax Event
Redemption Date for the purchase of the applicable Treasury
Portfolio for settlement on the Tax Event Redemption Date; or
(ii) in the case of a successful remarketing
occurring on a Remarketing Date that occurs prior to the third
Business Day immediately preceding the Stock Purchase Date,
for the purchase of the applicable Treasury Portfolio
(excluding the Opt-out Treasury Consideration) for settlement
on the applicable Remarketing Settlement Date.
"Treasury Security" means a zero-coupon U.S. Treasury security
(CUSIP Number 000000XX0) maturing before the Stock Purchase Date that will pay
$1,000 on such maturity date.
"Trustee" means The Bank of New York, a New York banking
corporation, as trustee under the Indenture, or any successor thereto.
"Underwriting Agreement" means the Underwriting Agreement
relating to the Units dated May 21, 2002 among the Company and the underwriters
named therein relating to the Units.
"Unit" means a Normal Unit or a Stripped Unit.
"Vice-President" means any vice-president, whether or not
designated by a number or a word or words added before or after the title "vice-
president."
Section 1.2 Compliance Certificates and Opinions.
Except as otherwise expressly provided by this Agreement, upon
any application or request by the Company to the Agent to take any action under
any provision of this Agreement, the Company shall furnish to the Agent an
Officer's Certificate stating that all conditions precedent, if any, provided
for in this Agreement relating to the proposed action have been complied with
and, if requested by the Agent, an Opinion of Counsel stating that, in the
opinion of such counsel, all such conditions precedent, if any, have been
complied with, except that in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Agreement relating to such particular application or request, no
additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement (other than the Officer's
Certificate provided for in Section 10.5) shall include:
(a) a statement that the individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
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(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of such individual, he or
she has made such examination or investigation as is necessary to
enable such individual to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of such
individual, such condition or covenant has been complied with.
Section 1.3 Form of Documents Delivered to Agent.
(a) In any case where several matters are required to be
certified by, or covered by an opinion of, any specified Person, it is
not necessary that all such matters be certified by, or covered by the
opinion of, only one such Person, or that they be so certified or
covered by only one document, but one such Person may certify or give
an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an
opinion as to such matters in one or several documents.
(b) Any certificate or opinion of an officer of the Company
may be based, insofar as it relates to legal matters, upon a
certificate or opinion of, or representations by, counsel, unless such
officer knows, or in the exercise of reasonable care should know, that
the certificate or opinion or representations with respect to the
matters upon which his certificate or opinion is based are erroneous.
Any such certificate or Opinion of Counsel may be based, insofar as it
relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that
the information with respect to such factual matters is in the
possession of the Company unless such counsel knows, or in the exercise
of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
(c) Where any Person is required to make, give or execute two
or more applications, requests, consents, certificates, statements,
opinions or other instruments under this Agreement, they may, but need
not, be consolidated and form one instrument.
Section 1.4 Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Agreement to be given
or taken by Holders may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in
person or by agent duly appointed in writing; and, except as herein
otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Agent and, where it
is hereby expressly required, to the Company. Such instrument or
instruments (and the action embodied therein and evidenced thereby) are
herein sometimes referred to as the "Act" of the Holders signing such
instrument or instruments. Proof of execution of any such instrument or
of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and (subject to Section 7.1) conclusive in
favor of the Agent and the Company, if made in the manner provided in
this Section.
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(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved in any manner which the Agent
deems sufficient.
(c) The ownership of Units shall be proved by the Normal Units
Register or the Stripped Units Register, as the case may be.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Certificate shall
bind every future Holder of the same Certificate and the Holder of
every Certificate issued upon the registration of transfer thereof or
in exchange therefor or in lieu thereof in respect of anything done,
omitted or suffered to be done by the Agent or the Company in reliance
thereon, whether or not notation of such action is made upon such
Certificate.
(e) The Company may set any day as a record date for the
purpose of determining the Holders of Outstanding Units entitled to
give, make or take any request, demand, authorization, direction,
notice, consent, waiver or other action provided or permitted by this
Agreement to be given, made or taken by Holders of Units. If any record
date is set pursuant to this paragraph, the Holders of the Outstanding
Units on such record date, and no other Holders, shall be entitled to
take the relevant action with respect to the relevant Normal Units or
the relevant Stripped Units, as the case may be, whether or not such
Holders remain Holders after such record date; provided that no such
action shall be effective hereunder unless taken on or prior to the
applicable Expiration Date by Holders of the requisite number of
Outstanding Units on such record date. Nothing in this paragraph shall
be construed to prevent the Company from setting a new record date for
any action for which a record date has previously been set pursuant to
this paragraph (whereupon the record date previously set shall
automatically and with no action by any Person be cancelled and of no
effect), and nothing in this paragraph shall be construed to render
ineffective any action taken by Holders of the requisite number of
Outstanding Units on the date such action is taken. Promptly after any
record date is set pursuant to this paragraph, the Company, at its own
expense, shall cause notice of such record date, the proposed action by
Holders and the applicable Expiration Date to be given to the Agent in
writing and to each Holder of Units in the manner set forth in Section
1.6.
(f) With respect to any record date set pursuant to this
Section, the Company may designate any date as the "Expiration Date"
and from time to time may change the Expiration Date to any earlier or
later day; provided that no such change shall be effective unless
notice of the proposed new Expiration Date is given to the Agent in
writing, and to each Holder of Units in the manner set forth in Section
1.6, on or prior to the existing Expiration Date. If an Expiration Date
is not designated with respect to any record date set pursuant to this
Section, the Company shall be deemed to have initially designated the
180th day after such record date as the Expiration Date with respect
thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.
16
Section 1.5 Notices.
Any request, demand, authorization, direction, notice,
consent, waiver or Act of Holders or other document provided or permitted by
this Agreement to be made upon, given or furnished to, or filed with:
(a) the Agent by any Holder or by the Company shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing and
personally delivered, mailed, first-class postage prepaid, telecopied
or delivered by overnight air courier guaranteeing next day delivery,
to the Agent at 000 Xxxxxxx Xxxxxx, Xxxxx 00X, Xxx Xxxx, Xxx Xxxx
00000, Attention: Corporate Trust Administration, telecopy:
000-000-0000, or at any other address furnished in writing by the Agent
to the Holders and the Company; or
(b) the Company by the Agent or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing and
personally delivered, mailed, first-class postage prepaid, telecopied
or delivered by overnight air courier guaranteeing next day delivery,
to the Company at Toys "R" Us, Inc., 000 Xxxx Xxxx, Xxxxxxx, Xxx Xxxxxx
00000, Attention: Treasurer, or at any other address furnished in
writing to the Agent by the Company; or
(c) the Collateral Agent by the Agent, the Company or any
Holder shall be sufficient for every purpose hereunder (unless
otherwise herein expressly provided) if made, given, furnished or filed
in writing and personally delivered, mailed, first-class postage
prepaid, telecopied or delivered by overnight air courier guaranteeing
next day delivery, addressed to the Collateral Agent at JPMorgan Chase
Bank, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Institutional Trust Services, telecopy: 000-000-0000, or at any other
address furnished in writing by the Collateral Agent to the Agent, the
Company and the Holders; or
(d) the Trustee by the Company shall be sufficient for every
purpose hereunder (unless otherwise herein expressly provided) if made,
given, furnished or filed in writing and personally delivered, mailed,
first-class postage prepaid, telecopied or delivered by overnight air
courier guaranteeing next day delivery, addressed to the Trustee at 000
Xxxxxxx Xxxxxx, Xxxxx 00X, Xxx Xxxx, Xxx Xxxx 00000, Attention:
Corporate Trust Administration, telecopy: 000-000-0000 or at any other
address furnished in writing by the Trustee to the Company.
Section 1.6 Notice to Holders; Waiver.
(a) Where this Agreement provides for notice to Holders of any
event, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage
prepaid, to each Holder affected by such event, at its address as it
appears in the applicable Register, not later than the latest date, and
not earlier than the earliest date, prescribed for the giving of such
notice. In any case where notice to Holders is given by mail, neither
the failure to mail such notice, nor any defect in any notice so mailed
to any particular Holder shall affect the sufficiency of such notice
with respect to other Holders. Where this Agreement provides for notice
in any manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice. Waivers of notice
by Holders shall be filed with the Agent, but such filing shall not be
a condition precedent to the validity of any action taken in reliance
upon such waiver.
17
(b) In case by reason of the suspension of regular mail
service or by reason of any other cause it shall be impracticable to
give such notice by mail, then such notification as shall be made with
the approval of the Agent shall constitute a sufficient notification
for every purpose hereunder.
Section 1.7 Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
Section 1.8 Successors and Assigns.
All covenants and agreements in this Agreement by the Company
shall bind its successors and assigns, whether so expressed or not.
Section 1.9 Separability Clause.
In case any provision in this Agreement or in the Units shall
be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions hereof and thereof shall not in any way be affected
or impaired thereby.
Section 1.10 Benefits of Agreement.
Nothing in this Agreement or in the Units, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and, to the extent provided hereby, the Holders, any benefits or any
legal or equitable right, remedy or claim under this Agreement. The Holders from
time to time shall be beneficiaries of this Agreement and shall be bound by all
of the terms and conditions hereof and of the Units evidenced by their
Certificates by their acceptance of delivery of such Certificates.
Section 1.11 Governing Law.
This Agreement and the Units shall be governed by and
construed in accordance with the laws of the State of New York.
Section 1.12 Legal Holidays.
(a) In any case where any Payment Date shall not be a Business
Day, then (notwithstanding any other provision of this Agreement or the
Normal Units Certificates) payments on the Notes shall not be made on
such date, but such payments shall be made on the next succeeding
Business Day with the same force and effect as if made on such Payment
Date, provided that no interest shall accrue or be payable by the
Company for the period from and after any such Payment Date, except
that if such next succeeding Business Day is in the next succeeding
calendar year, such payment shall be made on the immediately preceding
Business Day with the same force and effect as if made on such Payment
Date.
18
(b) In any case where any Settlement Date shall not be a
Business Day, then (notwithstanding any other provision of this
Agreement or the Certificates), the Purchase Contracts shall not be
performed on such date, but the Purchase Contracts shall be performed
on the immediately following Business Day with the same force and
effect as if performed on the relevant Settlement Date.
Section 1.13 Counterparts.
This Agreement may be executed in any number of counterparts
by the parties hereto, each of which, when so executed and delivered, shall be
deemed an original, but all such counterparts shall together constitute one and
the same instrument.
Section 1.14 Inspection of Agreement.
A copy of this Agreement shall be available at all reasonable
times during normal business hours at the Corporate Trust Office for inspection
by any Holder.
ARTICLE 2
CERTIFICATE FORMS
Section 2.1 Forms of Certificates Generally.
(a) The Normal Units Certificates (including the form of
Purchase Contract forming part of the Normal Units evidenced thereby)
shall be in substantially the form set forth in Exhibit A hereto, with
such letters, numbers or other marks of identification or designation
and such legends or endorsements printed, lithographed or engraved
thereon as may be required by the rules of any securities exchange or
quotation system on which the Normal Units are listed or quoted for
trading or any depositary therefor, or as may, consistently herewith,
be determined by the officers of the Company executing such Normal
Units Certificates, as evidenced by their execution of the Normal Units
Certificates.
(b) The definitive Normal Units Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced
in any other manner, all as determined by the officers of the Company
executing such Normal Units Certificates, consistent with the
provisions of this Agreement, as evidenced by their execution thereof.
19
(c) The Stripped Units Certificates (including the form of
Purchase Contracts forming part of the Stripped Units evidenced
thereby) shall be in substantially the form set forth in Exhibit B
hereto, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or
engraved thereon as may be required by the rules of any securities
exchange or the quotation system on which the Stripped Units may be
listed or quoted for trading or any depositary therefor, or as may,
consistently herewith, be determined by the officers of the Company
executing such Stripped Units Certificates, as evidenced by their
execution of the Stripped Units Certificates.
(d) The definitive Stripped Units Certificates shall be
printed, lithographed or engraved on steel engraved borders or may be
produced in any other manner, all as determined by the officers of the
Company executing such Stripped Units Certificates, consistent with the
provisions of this Agreement, as evidenced by their execution thereof.
(e) Every Global Certificate authenticated, executed on behalf
of the Holders and delivered hereunder shall bear a legend in
substantially the following form:
"For inclusion in Global CertificateS only -- THIS CERTIFICATE
IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE CONTRACT AGREEMENT
(AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE NAME OF THE CLEARING AGENCY OR
A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR
A CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE IN WHOLE OR IN
PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH CLEARING
AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE PURCHASE CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized
representative of The Depository Trust Company (55 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 10041-0099) to the Company or its agent for registration of
transfer, exchange or payment, and any Certificate issued is registered in the
name of Cede & Co., or such other name as requested by an authorized
representative of The Depository Trust Company, and any payment hereon is made
to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY A PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an
interest herein."
Section 2.2 Form of Agent's Certificate of Authentication.
(a) The form of the Agent's certificate of authentication of
the Normal Units shall be in substantially the form set forth on the
form of the Normal Units Certificates.
(b) The form of the Agent's certificate of authentication of
the Stripped Units shall be in substantially the form set forth on the
form of the Stripped Units Certificates.
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ARTICLE 3
THE UNITS
Section 3.1 Title and Terms; Denominations.
(a) The aggregate number of Normal Units initially evidenced
by Certificates authenticated, executed on behalf of the Holders and
delivered hereunder is limited to 7,000,000 (or 8,050,000 if the
underwriters' over-allotment option granted pursuant to the
Underwriting Agreement is exercised in full), except for Certificates
authenticated, executed and delivered upon registration of transfer of,
in exchange for, or in lieu of, other Certificates pursuant to Section
3.4, 3.5, 3.10, 3.13, 3.14, 5.9, 5.10 or 8.5.
(b) The Certificates shall be issuable only in registered form
and only in denominations of a single Unit and any integral multiple
thereof.
Section 3.2 Rights and Obligations Evidenced by the
Certificates.
(a) Each Normal Units Certificate shall evidence the number of
Normal Units specified therein, with each such Normal Unit representing
the ownership by the Holder thereof of a beneficial interest in a Note
or Applicable Ownership Interest in the Treasury Portfolio, as the case
may be, subject to the Pledge of such Note or Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, by such Holder
pursuant to the Pledge Agreement and the Indenture, and the rights and
obligations of the Holder thereof and the Company under one Purchase
Contract. The Agent as attorney-in-fact for, and on behalf of, the
Holder of each Normal Unit shall pledge, pursuant to the Pledge
Agreement and the Indenture, the Note or the Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, forming a part
of such Normal Unit, to the Collateral Agent and grant to the
Collateral Agent a security interest in the right, title, and interest
of such Holder in such Note or such Applicable Ownership Interest in
the Treasury Portfolio, as the case may be, for the benefit of the
Company, to secure the obligation of the Holder under each Purchase
Contract to purchase the Common Stock of the Company. Prior to the
purchase of shares of Common Stock under each Purchase Contract, such
Purchase Contracts shall not entitle the Holders of Normal Units
Certificates to any of the rights of a holder of shares of Common
Stock, including, without limitation, the right to vote or receive any
dividends or other payments or to consent or to receive notice as
stockholders in respect of the meetings of stockholders or for the
election of directors of the Company or for any other matter, or any
other rights whatsoever as stockholders of the Company.
21
(b) Each Stripped Units Certificate shall evidence the number
of Stripped Units specified therein, with each such Stripped Unit
representing the ownership by the Holder thereof of a 1/20 or 5.0%
undivided beneficial interest in a Treasury Security with a principal
amount at maturity equal to $1,000, subject to the Pledge of such
interest in such Treasury Security by such Holder pursuant to the
Pledge Agreement, and the rights and obligations of the Holder thereof
and the Company under one Purchase Contract. Prior to the purchase of
shares of Common Stock under each Purchase Contract, such Purchase
Contracts shall not entitle the Holders of Stripped Units Certificates
to any of the rights of a holder of shares of Common Stock, including,
without limitation, the right to vote or receive any dividends or other
payments or to consent or to receive notice as stockholders in respect
of the meetings of stockholders or for the election of directors of the
Company or for any other matter, or any other rights whatsoever as
stockholders of the Company.
Section 3.3 Execution, Authentication, Delivery and Dating.
(a) Subject to the provisions of Sections 3.13 and 3.14, upon
the execution and delivery of this Agreement, and at any time and from
time to time thereafter, the Company may deliver Certificates executed
by the Company to the Agent for authentication, execution on behalf of
the Holders and delivery, together with its Issuer Order for
authentication of such Certificates, and the Agent in accordance with
such Issuer Order shall authenticate, execute on behalf of the Holders
and deliver such Certificates.
(b) The Certificates shall be executed on behalf of the
Company by the Chief Executive Officer, the Chief Financial Officer,
the President, any Vice-President, the Treasurer, any Assistant
Treasurer, the Secretary or any Assistant Secretary (or other officer
performing similar functions) of the Company and delivered to the
Agent. The signature of any of these officers on the Certificates may
be manual or facsimile.
(c) Certificates bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company
shall bind the Company, notwithstanding that such individuals or any of
them have ceased to hold such offices prior to the authentication and
delivery of such Certificates or did not hold such offices at the date
of such Certificates.
(d) No Purchase Contract evidenced by a Certificate shall be
valid until such Certificate has been executed on behalf of the Holder
by the manual signature of an authorized officer of the Agent, as such
Holder's attorney-in-fact. Such signature by an authorized officer of
the Agent shall be conclusive evidence that the Holder of such
Certificate has entered into the Purchase Contracts evidenced by such
Certificate.
(e) Each Certificate shall be dated the date of its
authentication.
(f) No Certificate shall be entitled to any benefit under this
Agreement or be valid or obligatory for any purpose unless there
appears on such Certificate a certificate of authentication
substantially in the form provided for herein executed by an authorized
signatory of the Agent by manual signature, and such certificate upon
any Certificate shall be conclusive evidence, and the only evidence,
that such Certificate has been duly authenticated and delivered
hereunder.
Section 3.4 Temporary Certificates.
(a) Pending the preparation of definitive Certificates, the
Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holders, and deliver, in lieu of
such definitive Certificates, temporary Certificates which are in
substantially the form set forth in Exhibit A or Exhibit B hereto, as
the case may be, with such letters, numbers or other marks of
identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Normal Units or Stripped Units, as the
case may be, are listed, or as may, consistent herewith, be determined
by the officers of the Company executing such Certificates, as
evidenced by their execution of the Certificates.
22
(b) If temporary Certificates are issued, the Company will
cause definitive Certificates to be prepared without unreasonable
delay. After the preparation of definitive Certificates, the temporary
Certificates shall be exchangeable for definitive Certificates upon
surrender of the temporary Certificates at the Corporate Trust Office,
at the expense of the Company and without charge to the Holder. Upon
surrender for cancellation of any one or more temporary Certificates,
the Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange
therefor, one or more definitive Certificates of like tenor and
denominations and evidencing a like number of Normal Units or Stripped
Units, as the case may be, as the temporary Certificate or Certificates
so surrendered. Until so exchanged, the temporary Certificates shall in
all respects evidence the same benefits and the same obligations with
respect to the Normal Units or Stripped Units, as the case may be,
evidenced thereby as definitive Certificates.
Section 3.5 Registration; Registration of Transfer and
Exchange.
(a) The Agent shall keep at the Corporate Trust Office a
register (the "Normal Units Register") in which, subject to such
reasonable regulations as it may prescribe, the Agent shall provide for
the registration of Normal Units Certificates and of transfers of
Normal Units Certificates (the Agent, in such capacity, the "Normal
Units Registrar") and a register (the "Stripped Units Register") in
which, subject to such reasonable regulations as it may prescribe, the
Agent shall provide for the registration of the Stripped Units
Certificates and transfers of Stripped Units Certificates (the Agent,
in such capacity, the "Stripped Units Registrar").
(b) Upon surrender for registration of transfer of any
Certificate at the Corporate Trust Office, the Company shall execute
and deliver to the Agent, and the Agent shall authenticate, execute on
behalf of the designated transferee or transferees, and deliver, in the
name of the designated transferee or transferees, one or more new
Certificates of like tenor and denominations, and evidencing a like
number of Normal Units or Stripped Units, as the case may be.
(c) At the option of the Holder, Certificates may be exchanged
for other Certificates, of like tenor and denominations and evidencing
a like number of Normal Units or Stripped Units, as the case may be,
upon surrender of the Certificates to be exchanged at the Corporate
Trust Office. Whenever any Certificates are so surrendered for
exchange, the Company shall execute and deliver to the Agent, and the
Agent shall authenticate, execute on behalf of the Holder, and deliver
the Certificates which the Holder making the exchange is entitled to
receive.
23
(d) All Certificates issued upon any registration of transfer
or exchange of a Certificate shall evidence the ownership of the same
number of Normal Units or Stripped Units, as the case may be, and be
entitled to the same benefits and subject to the same obligations,
under this Agreement as the Normal Units or Stripped Units, as the case
may be, evidenced by the Certificate surrendered upon such registration
of transfer or exchange.
(e) Every Certificate presented or surrendered for
registration of transfer or for exchange shall (if so required by the
Agent) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company and the Agent duly
executed, by the Holder thereof or its attorney duly authorized in
writing.
(f) No service charge shall be made for any registration of
transfer or exchange of a Certificate, but the Company and the Agent
may require payment from the Holder of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection with
any registration of transfer or exchange of Certificates, other than
any exchanges pursuant to Sections 3.4, 3.6, 3.9 and 8.5 not involving
any transfer.
(g) Notwithstanding the foregoing, the Company shall not be
obligated to execute and deliver to the Agent, and the Agent shall not
be obligated to authenticate, execute on behalf of the Holder and
deliver any Certificate presented or surrendered for registration of
transfer or for exchange on or after the Business Day immediately
preceding the earlier of the Stock Purchase Date or the Termination
Date. In lieu of delivery of a new Certificate, upon satisfaction of
the applicable conditions specified above in this Section and receipt
of appropriate registration or transfer instructions from such Holder,
the Agent shall,
(i) if the Stock Purchase Date has occurred, deliver
the shares of Common Stock issuable in respect of the Purchase
Contracts forming a part of the Units evidenced by such
Certificate,
(ii) in the case of Normal Units, if a Termination
Event shall have occurred prior to the Stock Purchase Date,
transfer the Notes or the Applicable Ownership Interest in the
Treasury Portfolio, as applicable, relating to such Normal
Units, or
(iii) in the case of Stripped Units, if a Termination
Event shall have occurred prior to the Stock Purchase Date,
transfer the Treasury Securities relating to such Stripped
Units, in each case subject to the applicable conditions and
in accordance with the applicable provisions of Article V.
24
Section 3.6 Book-Entry Interests.
The Certificates, on original issuance, will be issued in the
form of one or more, fully registered Global Certificates, to be delivered to
the Depositary or its custodian by, or on behalf of, the Company. Such Global
Certificate shall initially be registered in the applicable Register in the name
of Cede & Co., the nominee of the Depositary, and no Beneficial Owner will
receive a definitive Certificate representing such Beneficial Owner's interest
in such Global Certificate, except as provided in Section 3.9. The Agent shall
enter into an agreement with the Depositary if so requested by the Company.
Unless and until definitive, fully registered Certificates have been issued to
Beneficial Owners pursuant to Section 3.9:
(a) the provisions of this Section 3.6 shall be in full force
and effect;
(b) the Company shall be entitled to deal with the Clearing
Agency for all purposes of this Agreement (including receiving
approvals, votes or consents hereunder) as the Holder of the Units and
the sole holder of the Global Certificate(s) and shall have no
obligation to the Beneficial Owners;
(c) to the extent that the provisions of this Section 3.6
conflict with any other provisions of this Agreement, the provisions of
this Section 3.6 shall control; and
(d) the rights of the Beneficial Owners shall be exercised
only through the Clearing Agency and shall be limited to those
established by law and agreements between such Beneficial Owners and
the Clearing Agency and/or the Clearing Agency Participants. The
Clearing Agency will make book-entry transfers among Clearing Agency
Participants.
Section 3.7 Notices to Holders.
Whenever a notice or other communication to the Holders is
required to be given under this Agreement, the Company or the Company's agent
shall give such notices and communications to the Holders and, with respect to
any Units registered in the name of a Clearing Agency or the nominee of a
Clearing Agency, the Company or the Company's agent shall, except as set forth
herein, have no obligations to the Beneficial Owners.
Section 3.8 Appointment of Successor Clearing Agency.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Units, the Company may, in its sole
discretion, appoint a successor Clearing Agency with respect to the Units.
25
Section 3.9 Definitive Certificates.
If:
(i) a Clearing Agency elects to discontinue its
services as securities depositary with respect to the Units
and a successor Clearing Agency is not appointed within 90
days after such discontinuance pursuant to Section 3.8,
(ii) the Company elects to terminate the book-entry
system through the Clearing Agency with respect to the Units,
or
(iii) there shall have occurred and be continuing a
default by the Company in respect of its obligations under one
or more Purchase Contracts,
then upon surrender of the Global Certificates representing the Book-
Entry Interests with respect to the Units by the Clearing Agency,
accompanied by registration instructions, the Company shall cause
definitive Certificates to be delivered to Beneficial Owners in
accordance with the instructions of the Clearing Agency. The Company
and the Agent shall not be liable for any delay in delivery of such
instructions and may conclusively rely on and shall be protected in
relying on, such instructions.
Section 3.10 Mutilated, Destroyed, Lost and Stolen
Certificates.
(a) If any mutilated Certificate is surrendered to the Agent,
the Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange
therefor, a new Certificate at the cost of the Holder, evidencing the
same number of Normal Units or Stripped Units, as the case may be, and
bearing a Certificate number not contemporaneously outstanding.
(b) If there shall be delivered to the Company and the Agent
(i) evidence to their satisfaction of the destruction, loss or theft of
any Certificate, and (ii) such security or indemnity at the cost of the
Holder as may be required by them to hold each of them and any agent of
any of them harmless, then, in the absence of notice to the Company or
the Agent that such Certificate has been acquired by a bona fide
purchaser, the Company shall execute and deliver to the Agent, and the
Agent shall authenticate, execute on behalf of the Holder, and deliver
to the Holder, in lieu of any such destroyed, lost or stolen
Certificate, a new Certificate, evidencing the same number of Normal
Units or Stripped Units, as the case may be, and bearing a Certificate
number not contemporaneously outstanding.
(c) Notwithstanding the foregoing, the Company shall not be
obligated to execute and deliver to the Agent, and the Agent shall not
be obligated to authenticate, execute on behalf of the Holder, and
deliver to the Holder, a Certificate on or after the Business Day
immediately preceding the earlier of the Stock Purchase Date or the
Termination Date. In lieu of delivery of a new Certificate, upon
satisfaction of the applicable conditions specified above in this
Section and receipt of appropriate registration or transfer
instructions from such Holder, the Agent shall (i) if the Stock
Purchase Date has occurred, deliver the shares of Common Stock issuable
in respect of the Purchase Contracts forming a part of the Units
evidenced by such Certificate, or (ii) if a Termination Event shall
have occurred prior to the Stock Purchase Date, transfer the Notes, the
Applicable Ownership Interest in the Treasury Portfolio or the Treasury
Securities, as the case may be, evidenced thereby, in each case subject
to the applicable conditions and in accordance with the applicable
provisions of Article V.
26
(d) Upon the issuance of any new Certificate under this
Section, the Company and the Agent may require the payment by the
Holder of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses
(including the fees and expenses of the Agent) connected therewith.
(e) Every new Certificate issued pursuant to this Section in
lieu of any destroyed, lost or stolen Certificate shall constitute an
original additional contractual obligation of the Company and of the
Holder in respect of the Unit evidenced thereby, whether or not the
destroyed, lost or stolen Certificate (and the Units evidenced thereby)
shall be at any time enforceable by anyone, and shall be entitled to
all the benefits and be subject to all the obligations of this
Agreement equally and proportionately with any and all other
Certificates delivered hereunder.
(f) The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost or
stolen Certificates.
Section 3.11 Persons Deemed Owners.
(a) Prior to due presentment of a Certificate for registration
of transfer, the Company and the Agent, and any agent of the Company or
the Agent, may treat the Person in whose name such Certificate is
registered as the owner of the Units evidenced thereby, for the purpose
of receiving interest payments on the Notes, performance of the
Purchase Contracts and for all other purposes whatsoever (subject to
Section 4.1(a)), whether or not any such payments shall be overdue and
notwithstanding any notice to the contrary, and neither the Company nor
the Agent, nor any agent of the Company or the Agent, shall be affected
by notice to the contrary.
(b) Notwithstanding the foregoing, with respect to any Global
Certificate, nothing herein shall prevent the Company, the Agent or any
agent of the Company or the Agent, from giving effect to any written
certification, proxy or other authorization furnished by any Clearing
Agency (or its nominee), as a Holder, with respect to such Global
Certificate or impair, as between such Clearing Agency and owners of
beneficial interests in such Global Certificate, the operation of
customary practices governing the exercise of rights of such Clearing
Agency (or its nominee) as Holder of such Global Certificate. None of
the Company, the Agent, or any agent of the Company or the Agent, will
have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership
interests of a Global Certificate or maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
27
Section 3.12 Cancellation.
(a) All Certificates surrendered (i) for delivery of shares of
Common Stock on or after any Settlement Date; (ii) upon the transfer of
Notes, Applicable Ownership Interest in the Treasury Portfolio or
Treasury Securities, as the case may be, after the occurrence of a
Termination Event; or (iii) upon the registration of a transfer or
exchange of a Unit shall, if surrendered to any Person other than the
Agent, be delivered to the Agent and, if not already cancelled, shall
be promptly cancelled by it. The Company may at any time deliver to the
Agent for cancellation any Certificates previously authenticated,
executed and delivered hereunder which the Company may have acquired in
any manner whatsoever, and all Certificates so delivered shall, upon
Issuer Order, be promptly cancelled by the Agent. No Certificates shall
be authenticated, executed on behalf of the Holder and delivered in
lieu of or in exchange for any Certificates cancelled as provided in
this Section, except as expressly permitted by this Agreement. All
cancelled Certificates held by the Agent shall be disposed of by the
Agent in accordance with its customary procedures.
(b) If the Company or any Affiliate of the Company shall
acquire any Certificate, such acquisition shall not operate as a
cancellation of such Certificate unless and until such Certificate is
delivered to the Agent cancelled or for cancellation.
Section 3.13 Collateral Substitution and the Establishment of
Stripped Units.
(a) Except as otherwise provided in this Section 3.13, a
Holder of Normal Units shall have the right to substitute Treasury
Securities for the Pledged Notes or Pledged Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, securing such
Holder's obligations under the Purchase Contracts comprising a part of
such Normal Units (a "Collateral Substitution"), by (i) Transfer to the
Collateral Agent of Treasury Securities having an aggregate principal
amount equal to the aggregate Stated Amount of such Normal Units and
(ii) delivery of such Normal Units to the Purchase Contract Agent,
accompanied by a notice, substantially in the form of Exhibit D hereto,
to the Agent stating that such Holder has Transferred Treasury
Securities to the Collateral Agent pursuant to this Section 3.13
(stating the principal amount and the CUSIP numbers of the Treasury
Securities Transferred by such Holder) and requesting that the Purchase
Contract Agent instruct the Collateral Agent to release from the Pledge
the Pledged Notes or Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, related to such Normal Units,
whereupon the Purchase Contract Agent shall promptly give such
instruction in writing to the Collateral Agent substantially in the
form provided in Exhibit C. Notwithstanding the foregoing, a Holder may
not substitute Treasury Securities for Pledged Notes or Pledged
Applicable Ownership Interest in the Treasury Portfolio pursuant to
this Section 3.13 after 10:00 a.m. (New York City time): (i) on the
fourth Business Day immediately preceding the Initial Remarketing Date
until the Business Day immediately following such Initial Remarketing
Date; (ii) on the fourth Business Day immediately preceding the first
day of the Subsequent Remarketing Period ending on June 16, 2005 or
July 14, 2005 until the Business Day immediately following such
Remarketing Period; and (iii) on the tenth Business Day immediately
preceding the Stock Purchase Date. Upon receipt of Treasury Securities
from a Holder of Normal Units and the related written instruction from
the Purchase Contract Agent, in accordance with the terms of the Pledge
Agreement, the Collateral Agent shall release the Pledged Notes or
Pledged Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, and shall promptly Transfer such Pledged Notes, or Pledged
Applicable Ownership Interest in the Treasury Portfolio, as the case
may be, free and clear of any lien, pledge or security interest created
under the Pledge Agreement, to the Purchase Contract Agent, and upon
receipt thereof the Agent shall promptly:
28
(i) cancel the related Normal Units;
(ii) transfer the Pledged Notes, or Pledged
Applicable Ownership Interest in the Treasury Portfolio, as
the case may be, to the Holder; and
(iii) authenticate, execute on behalf of such Holder
and deliver to such Holder a Stripped Units Certificate
executed by the Company in accordance with Section 3.3
evidencing the same number of Purchase Contracts as were
evidenced by the cancelled Normal Units.
(b) Holders who elect to separate Pledged Notes or Pledged
Applicable Ownership Interest in the Treasury Portfolio, as the case
may be, from the related Purchase Contracts and to substitute Treasury
Securities for such Pledged Notes or Pledged Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, shall be
responsible for any fees or expenses payable to the Collateral Agent
for its services as Collateral Agent in respect of the substitution,
and the Company shall not be responsible for any such fees or expenses.
(c) Holders may make Collateral Substitutions (i) if Treasury
Securities are being substituted for Pledged Notes, only in integral
multiples of 20 Normal Units, or (ii) if the Collateral Substitutions
occur after the Initial Remarketing Date (if such remarketing is
successful), or any Subsequent Remarketing Date (if such remarketing is
successful), or a Tax Event Redemption, as the case may be, only in
integral multiples of Normal Units such that the Treasury Securities to
be deposited and the Applicable Ownership Interest in the Treasury
Portfolio to be released are in integral multiples of $1,000.
(d) In the event a Holder making a Collateral Substitution
pursuant to this Section 3.13 fails to effect a book-entry transfer of
the Normal Units or fails to deliver a Normal Units Certificate to the
Agent after depositing Treasury Securities with the Collateral Agent,
the Pledged Notes or Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, constituting a part of such
Normal Units, and any distributions on such Pledged Notes or Pledged
Applicable Ownership Interest in the Treasury Portfolio, as the case
may be, shall be held in the name of the Agent or its nominee in trust
for the benefit of such Holder, until such Normal Units are so
transferred or the Normal Units Certificate is so delivered, as the
case may be, or, with respect to a Normal Units Certificate, such
Holder provides evidence satisfactory to the Company and the Agent that
such Normal Units Certificate has been destroyed, lost or stolen,
together with any indemnity that may be required by the Agent and the
Company.
29
(e) Except as provided in this Section 3.13, for so long as
the Purchase Contract underlying a Normal Unit remains in effect, such
Normal Unit shall not be separable into its constituent parts, and the
rights and obligations of the Holder of such Normal Unit in respect of
the Note or the Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, and the Purchase Contract comprising
such Normal Unit may be acquired, and may be transferred and exchanged,
only as a Normal Unit.
(f) The Holders' right to create Stripped Units as set forth
in this Section and the limit of the preceding sentence shall in no way
limit the ability of the Agent, the Collateral Agent, the Securities
Intermediary or the Remarketing Agent to substitute the Treasury
Portfolio for the Notes then comprising a part of Normal Units upon a
successful remarketing.
Section 3.14 Reestablishment of Normal Units.
(a) Except as otherwise provided in this Section 3.14, a
Holder of Stripped Units shall have the right to reestablish Normal
Units by (x) transferring to the Collateral Agent Notes or Applicable
Ownership Interest (as defined in clause (A) of the definition of such
term) in the Treasury Portfolio, as the case may be, then comprising
such number of Normal Units as is equal to such Stripped Units and (y)
delivering such Stripped Units, accompanied by a notice, substantially
in the form of Exhibit D hereto, to the Agent stating that such Holder
has transferred Notes or Applicable Ownership Interests in the Treasury
Portfolio to the Collateral Agent pursuant to this Section 3.14 and
requesting that the Agent instruct the Collateral Agent to release from
the Pledge the Pledged Treasury Securities related to such Stripped
Units, whereupon the Agent shall give such instruction to the
Collateral Agent substantially in the form provided in Exhibit C;
provided, however, that if a Tax Event Redemption or a successful
Remarketing has occurred and the Treasury Portfolio has become a
component of the Normal Units, Holders of Stripped Units may make such
substitution only in integral multiples of Stripped Units such that the
Applicable Ownership Interest in the Treasury Portfolio to be deposited
and the Treasury Securities to be released are in integral multiples of
$1,000, at any time on or prior to the Business Day immediately
preceding the Stock Purchase Date. Notwithstanding the foregoing, a
Holder of Stripped Units shall not have the right to reestablish Normal
Units pursuant to this Section 3.14 after 10:00 a.m. (New York City
time): (i) on the fourth Business Day immediately preceding the Initial
Remarketing Date until the Business Day immediately following such
Initial Remarketing Date; (ii) on the fourth Business Day immediately
preceding the first day of the Subsequent Remarketing Period beginning
on June 16, 2005 or July 14, 2005 until the Business Day immediately
following such Remarketing Period; and (iii) on the tenth Business Day
immediately preceding the Stock Purchase Date. Upon receipt of the
Notes or Applicable Ownership Interest in the Treasury Portfolio, as
the case may be, from such Holder and the instruction from the Agent,
the Collateral Agent, in accordance with the terms of the Pledge
Agreement, shall release the Pledged Treasury Securities and shall
promptly Transfer such Pledged Treasury Securities, free and clear of
any lien, pledge or security interest created under the Pledge
Agreement to the Agent, and upon receipt thereof, the Agent shall
promptly:
30
(i) cancel the related Stripped Units;
(ii) transfer the Pledged Treasury Securities to the
Holder; and
(iii) authenticate, execute on behalf of such Holder
and deliver a Normal Units Certificate executed by the Company
in accordance with Section 3.3 evidencing the same number of
Purchase Contracts as were evidenced by the cancelled Stripped
Units.
(b) Holders of Stripped Units who reestablish Normal Units
shall be responsible for any fees or expenses payable to the Collateral
Agent for its services as Collateral Agent in respect of the
substitution, and the Company shall not be responsible for any such
fees or expenses.
(c) Holders of Stripped Units may reestablish Normal Units (i)
only in integral multiples of 20 Stripped Units for 20 Normal Units or
(ii) if the reestablishment occurs after the Initial Remarketing Date
(if such remarketing is successful) or any Subsequent Remarketing Date
(if such remarketing is successful), or after a Tax Event Redemption,
only in integral multiples of Stripped Units such that the Applicable
Ownership Interest in the Treasury Portfolio to be deposited and the
Treasury Securities to be released are in integral multiples of $1,000.
(d) In the event a Holder who reestablishes Normal Units
pursuant to this Section 3.14 fails to effect a book-entry transfer of
the Stripped Units or fails to deliver a Stripped Units Certificate to
the Agent after depositing Pledged Notes or Pledged Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, with
the Collateral Agent, the Treasury Securities constituting a part of
such Stripped Units, and any distributions on such Treasury Securities
shall be held in the name of the Agent or its nominee in trust for the
benefit of such Holder, until such Stripped Units are so transferred or
the Stripped Units Certificate is so delivered, as the case may be, or,
with respect to a Stripped Units Certificate, such Holder provides
evidence satisfactory to the Company and the Agent that such Stripped
Units Certificate has been destroyed, lost or stolen, together with any
indemnity that may be required by the Agent and the Company.
(e) Except as provided in this Section 3.14, for so long as
the Purchase Contract underlying a Stripped Unit remains in effect,
such Stripped Unit shall not be separable into its constituent parts,
and the rights and obligations of the Holder of such Stripped Unit in
respect of the Treasury Securities and Purchase Contract comprising
such Stripped Unit may be acquired, and may be transferred and
exchanged, only as a Stripped Unit. The Holders' right to reestablish
Normal Units as set forth in this Section and the limit of the
preceding sentence shall in no way limit the ability of the Purchase
Contract Agent, the Collateral Agent, the Securities Intermediary or
the Remarketing Agent to substitute the Treasury Portfolio for the
Notes then comprising a part of Normal Units upon a successful
remarketing (other than the Notes of Holders of Normal Units that have
elected not to participate in the remarketing).
31
Section 3.15 Transfer of Collateral upon Occurrence of
Termination Event.
Upon the occurrence of a Termination Event and the transfer to
the Agent of the Notes, the Applicable Ownership Interest in the Treasury
Portfolio or the Treasury Securities, as the case may be, underlying the Normal
Units and the Stripped Units, respectively, pursuant to the terms of the Pledge
Agreement, the Agent shall request transfer instructions with respect to such
Notes, the Applicable Ownership Interest in the Treasury Portfolio or Treasury
Securities, as the case may be, from each Holder by written request mailed to
such Holder at its address as it appears in the Normal Units Register or the
Stripped Units Register, as the case may be. Upon book-entry transfer of the
Normal Units or Stripped Units or delivery of a Normal Units Certificate or
Stripped Units Certificate to the Agent with such transfer instructions, the
Agent shall Transfer the Notes, Applicable Ownership Interest in the Treasury
Portfolio or Treasury Securities, as the case may be, underlying such Normal
Units or Stripped Units, respectively, to such Holder by book-entry transfer, or
other appropriate procedures, in accordance with such instructions. In the event
a Holder of Normal Units or Stripped Units fails to effect such transfer or
delivery, the Notes, Applicable Ownership Interest in the Treasury Portfolio or
Treasury Securities, as the case may be, underlying such Normal Units or
Stripped Units, respectively, and any distributions thereon, shall be held in
the name of the Agent or its nominee in trust for the benefit of such Holder,
until the earlier of (1) such Normal Units or Stripped Units are transferred or
the Normal Units Certificate or Stripped Units Certificate is surrendered or
such Holder provides satisfactory evidence that such Normal Units Certificate or
Stripped Units Certificate has been destroyed, lost or stolen, together with any
indemnity that may be required by the Agent and the Company and (2) the
expiration of the time specified in applicable abandoned property laws.
Section 3.16 No Consent to Assumption.
Each Holder of a Unit, by acceptance thereof, shall be deemed
expressly to have withheld any consent to the assumption under Section 365 of
the Bankruptcy Code or otherwise, of the Purchase Contract by the Company, any
receiver, liquidator or person or entity performing similar functions or its
trustee in the event that the Company becomes the debtor under the Bankruptcy
Code or subject to other similar state or Federal law providing for
reorganization or liquidation.
ARTICLE 4
THE NOTES
Section 4.1 Payment of Interest; Rights to Interest Payments
Preserved; Notice.
(a) A payment on any Note or Applicable Ownership Interest in
the Treasury Portfolio, as the case may be, which is paid on any
Payment Date subject to receipt thereof by the Agent from, as
applicable, the Trustee or the Collateral Agent (if the Collateral
Agent is the registered owner thereof) as provided by the terms of the
Pledge Agreement, be paid to the Person in whose name the Normal Units
Certificate (or one or more Predecessor Normal Units Certificates) of
which such Note or the Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, is a part is registered at the close of
business on the Record Date for such Payment Date.
32
(b) Each Normal Units Certificate evidencing Notes delivered
under this Agreement upon registration of transfer of or in exchange
for or in lieu of any other Normal Units Certificate shall carry the
rights to interest accrued and unpaid, which were carried by the Notes
or Applicable Ownership Interest in the Treasury Portfolio, as the case
may be, underlying such other Normal Units Certificate.
(c) In the case of any Normal Unit with respect to which Early
Settlement of the underlying Purchase Contract is effected on an Early
Settlement Date, Merger Early Settlement of the underlying Purchase
Contract is effected on a Merger Early Settlement Date, Cash Settlement
is effected on the seventh Business Day preceding the Stock Purchase
Date, or a Collateral Substitution is effected, in each case on a date
that is after any Record Date and on or prior to the next succeeding
Payment Date, payments on the Note or the Applicable Ownership Interest
in the Treasury Portfolio, as the case may be, underlying such Normal
Unit otherwise payable on such Payment Date shall be payable on such
Payment Date notwithstanding such Early Settlement, Merger Early
Settlement, Cash Settlement or Collateral Substitution, as the case may
be, and such payments shall, subject to receipt thereof by the Agent,
be payable to the Person in whose name the Normal Units Certificate (or
one or more Predecessor Normal Unit Certificates) was registered at the
close of business on the Record Date. Except as otherwise expressly
provided in the immediately preceding sentence, in the case of any
Normal Unit with respect to which Early Settlement, Merger Early
Settlement or Cash Settlement of the underlying Purchase Contract is
effected, or with respect to which a Collateral Substitution has been
effected, payments on the related Notes or payments on the Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, that
would otherwise be payable after the applicable Settlement Date or
after such Collateral Substitution, as the case may be, shall not be
payable hereunder to the Holder of such Normal Unit; provided, that to
the extent that such Holder continues to hold the Separate Notes that
formerly comprised a part of such Holder's Normal Units, such Holder
shall be entitled to receive the payments on such Separate Notes.
Section 4.2 Notice and Voting.
Under the terms of the Pledge Agreement, the Agent will be
entitled to exercise the voting and any other consensual rights pertaining to
the Pledged Notes but only to the extent instructed by the Holders as described
below. Upon receipt of notice of any meeting at which holders of Notes are
entitled to vote or upon any solicitation of consents, waivers or proxies of
holders of Notes, the Agent shall, as soon as practicable thereafter, mail to
the Holders of Normal Units a notice (a) containing such information as is
contained in the notice or solicitation, (b) stating that each Holder on the
record date set by the Agent therefor (which, to the extent possible, shall be
the same date as the record date for determining the holders of Notes entitled
to vote) shall be entitled to instruct the Agent as to the exercise of the
voting rights pertaining to the Pledged Notes underlying their Normal Units and
(c) stating the manner in which such instructions may be given. Upon the written
request of the Holders of Normal Units on such record date, the Agent shall
endeavor insofar as practicable to vote or cause to be voted, in accordance with
the instructions set forth in such requests, the maximum number of Pledged Notes
as to which any particular voting instructions are received. In the absence of
specific instructions from the Holder of a Normal Unit, the Agent shall abstain
from voting the Pledged Note underlying such Normal Unit. The Company hereby
agrees, if applicable, to solicit Holders of Normal Units to timely instruct the
Agent in order to enable the Agent to vote such Pledged Notes.
33
Section 4.3 Tax Event Redemption.
(a) Upon the occurrence of a Tax Event Redemption prior to the
successful remarketing of Notes, the Company may elect to instruct in
writing the Collateral Agent to apply, and upon such written
instruction, the Collateral Agent, pursuant to the Pledge Agreement,
shall apply, out of the aggregate Redemption Price for all outstanding
Notes, an amount equal to the aggregate Tax Event Redemption Principal
Amount for such Notes that are components of Normal Units to purchase
on behalf of the Holders of Normal Units the applicable Treasury
Portfolio and promptly remit the remaining portion of such Redemption
Price to the Agent for payment to the Holders of such Normal Units. The
Treasury Portfolio will be substituted for the Pledged Notes, and will
be pledged to the Collateral Agent in accordance with the terms of the
Pledge Agreement to secure the obligation of each Holder of a Normal
Unit to purchase the Common Stock under the Purchase Contract
constituting a part of such Normal Unit. Following the occurrence of a
Tax Event Redemption prior to a successful remarketing of the Notes,
the Holders of Normal Units and the Collateral Agent shall have such
security interests, rights and obligations with respect to the Treasury
Portfolio as the Holder of Normal Units and the Collateral Agent had in
respect of the Notes, as the case may be, subject to the Pledge thereof
as provided in Articles II, III, IV, V and VI of the Pledge Agreement,
and any reference herein or in the Certificates to the Note shall be
deemed to be a reference to such Treasury Portfolio and any reference
herein or in the Certificates to interest on the Notes shall be deemed
to be a reference to corresponding distributions on the Treasury
Portfolio. The Company may cause to be made in any Normal Unit
Certificates thereafter to be issued such change in phraseology and
form (but not in substance) as may be appropriate to reflect the
substitution of the Treasury Portfolio for Notes as collateral.
(b) The Company shall cause notice of any Tax Event Redemption
to be mailed, at least 30 calendar days but not more than 60 calendar
days before such Tax Event Redemption Date, to each Holder of Notes to
be redeemed at its registered address.
(c) Upon the occurrence of a Tax Event Redemption after the
successful remarketing of the Notes, the Redemption Price will be
payable in cash to the holders of the Notes.
34
ARTICLE 5
THE PURCHASE CONTRACTS; THE REMARKETING
Section 5.1 Purchase of Shares of Common Stock.
(a) Each Purchase Contract shall, unless an Early Settlement
has occurred in accordance with Section 5.9, or a Merger Early
Settlement has occurred in accordance with Section 5.10, obligate the
Holder of the related Unit to purchase, and the Company to sell, on the
Stock Purchase Date at a price equal to $50 (the "Purchase Price"), a
number of issued shares of Common Stock equal to the Settlement Rate
unless, on or prior to the Stock Purchase Date, there shall have
occurred a Termination Event with respect to the Unit of which such
Purchase Contract is a part. The "Settlement Rate" is equal to,
(i) if the Applicable Market Value is greater than or
equal to $21.55 (the "Threshold Appreciation Price"), 2.3202
shares of Common Stock per Purchase Contract,
(ii) if the Applicable Market Value is less than the
Threshold Appreciation Price, but is greater than $17.65, the
number of shares of Common Stock per Purchase Contract equal
to the Stated Amount of the related Unit divided by the
Applicable Market Value, and
(iii) if the Applicable Market Value is equal to or
less than $17.65, 2.8329 shares of Common Stock per Purchase
Contract,
in each case subject to adjustment as provided in Section 5.6 (and in each case
rounded upward or downward to the nearest 1/10,000th of a share).
(b) No fractional shares of Common Stock will be issued by the
Company on the Stock Purchase Date. In lieu of fractional shares, the
Holder will be entitled to receive an amount in cash as provided in
Section 5.12.
(c) The "Applicable Market Value" means the average of the
Closing Price per share of Common Stock on each of the 20 consecutive
Trading Days ending on the third Trading Day immediately preceding the
Stock Purchase Date. The "Closing Price" of the Common Stock on any
date of determination means the closing sale price (or, if no closing
price is reported, the last reported sale price per share) of the
Common Stock on the New York Stock Exchange (the "NYSE") on such date
or, if the Common Stock is not listed for trading on the NYSE on any
such date, as reported in the composite transactions for the principal
United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States
national or regional securities exchange, as reported by The Nasdaq
Stock Market, or, if the Common Stock is not so reported, the last
quoted bid price for the Common Stock in the over-the-counter market as
reported by the National Quotation Bureau or similar organization, or,
if such bid price is not available, the market value of the Common
Stock on such date as determined by a nationally recognized independent
investment banking firm retained for this purpose by the Company. A
"Trading Day" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange
or association or over-the-counter market at the close of business and
(B) has traded at least once on the national or regional securities
exchange or association or over-the-counter market that is the primary
market for the trading of the Common Stock.
35
(d) Each Holder of a Unit, by its acceptance thereof,
irrevocably authorizes the Agent to enter into and perform the related
Purchase Contract on its behalf as its attorney-in-fact (including the
execution of Certificates on behalf of such Holder), agrees to be bound
by the terms and provisions hereof and thereof, covenants and agrees to
perform its obligations under such Purchase Contracts, and consents to
the provisions hereof, irrevocably authorizes the Agent as its
attorney-in-fact to enter into and perform the Pledge Agreement on its
behalf as its attorney-in-fact, and consents to and agrees to be bound
by the Pledge of the Notes, Applicable Ownership Interest in the
Treasury Portfolio or the Treasury Securities, as the case may be,
pursuant to the Pledge Agreement; provided that upon a Termination
Event, the rights of the Holder of such Unit under the Purchase
Contract may be enforced without regard to any other rights or
obligations. Each Holder of a Unit, by its acceptance thereof, further
covenants and agrees, to the remarketing of the Note included in its
Normal Unit, if applicable, pursuant to the remarketing provisions set
forth herein and in the Remarketing Agreement that, to the extent and
in the manner provided in Section 5.4 and the Pledge Agreement, but
subject to the terms thereof, payments in respect of the Notes,
Applicable Ownership Interest in the Treasury Portfolio or the Treasury
Securities, as the case may be, to be paid upon settlement of such
Holder's obligations to purchase Common Stock under the Purchase
Contract, shall be paid on the Stock Purchase Date by the Collateral
Agent to the Company in satisfaction of such Holder's obligations under
such Purchase Contract and agrees to (i) treat its acquisition of each
Normal Unit as the acquisition of the Note and Purchase Contract
constituting the Normal Unit and (ii) treat itself as the owner for all
tax purposes of the related Notes, Applicable Ownership Interest in the
Treasury Portfolio or Treasury Securities, as the case may be.
(e) Upon registration of transfer of a Certificate, the
transferee shall be bound (without the necessity of any other action on
the part of such transferee) under the terms of this Agreement, the
Purchase Contracts underlying such Certificate and the Pledge
Agreement, and the transferor shall be released from the obligations
under this Agreement, the Purchase Contracts underlying the
Certificates so transferred and the Pledge Agreement. The Company
covenants and agrees, and each Holder of a Certificate, by its
acceptance thereof, likewise covenants and agrees, to be bound by the
provisions of this paragraph.
Section 5.2 Reserved.
Section 5.3 Reserved.
36
Section 5.4 Payment of Purchase Price; Remarketing.
(a) (i) Unless a Tax Event Redemption, successful remarketing,
Termination Event, Merger Early Settlement or Early Settlement has
occurred, each Holder of a Normal Unit may pay in Cash ("Cash
Settlement") the Purchase Price for the shares of Common Stock to be
purchased pursuant to a Purchase Contract if such Holder notifies the
Agent by use of a notice in substantially the form of Exhibit E hereto
of its intention to make a Cash Settlement. Such notice must be made on
or prior to 10:00 a.m. (New York City time) on the tenth Business Day
immediately preceding the Stock Purchase Date. The Agent shall promptly
notify the Collateral Agent of the receipt of such a notice from a
Holder intending to make a Cash Settlement.
(ii) A Holder of a Normal Unit who has so notified
the Agent of its intention to make a Cash Settlement is
required to pay the Purchase Price to the Collateral Agent
prior to 10:00 a.m. (New York City time) on the seventh
Business Day immediately preceding the Stock Purchase Date in
Cash by certified or cashiers' check or wire transfer, in each
case, in immediately available funds payable to or upon the
order of the Collateral Agent for deposit into the Collateral
Account. Any such Cash received by the Collateral Agent will
be invested promptly by the Collateral Agent in Permitted
Investments and such Cash paid to the Company on the Stock
Purchase Date in settlement of the Purchase Contract in
accordance with the terms of this Agreement and the Pledge
Agreement. Any funds received by the Collateral Agent in
respect of the investment earnings from the investment in such
Permitted Investments, will be distributed to the Agent when
received for payment to the Holder. If such Holder fails to
deliver the required Cash, the Holder shall be deemed to have
consented to the disposition of the Pledged Notes pursuant to
the remarketing as described in paragraph (iv) below.
(iii) If a Holder of a Normal Units fails to notify
the Agent of its intention to make a Cash Settlement in
accordance with paragraph (a)(i) above, the Holder shall be
deemed to have consented to the disposition of the Pledged
Notes pursuant to the remarketing as described in paragraph
(b) below.
(iv) If a Holder of a Normal Unit does notify the
Agent as provided in paragraph (a)(i) above of its intention
to pay the Purchase Price in Cash, but fails to make such
payment as required by paragraph (a)(ii) above, the Holder of
such Notes of such a Holder shall be deemed to have consented
to the disposition of the Pledged Notes pursuant to the
remarketing as described in paragraph (b) below.
37
(b) (i) The Company shall engage a nationally recognized
investment bank (the "Remarketing Agent") pursuant to a Remarketing
Agreement to be entered into between the Company and the Remarketing
Agent to sell the Notes of Holders of Normal Units, other than Holders
that have elected not to participate in the remarketing pursuant to the
procedures set forth in clause (v) below, and holders of Separate Notes
that have elected to participate in the remarketing pursuant to the
procedures set forth in clause (vi) below, in Section 4.5(f) of the
Pledge Agreement and in Section 8.1(m) of the First Supplemental
Indenture. On or before the seventh Business Day prior to each of the
Initial Remarketing Date and the first day of any Subsequent
Remarketing Period, as the case may be, the Company shall give Holders
of Normal Units and holders of Separate Notes notice of the remarketing
(the "Remarketing Notice") (the form of which notice to be provided by
the Company and to designate an individual at the Company whom Holders
may contact for information regarding the remarketing) in a daily
newspaper in the English language of general circulation in The City of
New York, which is expected to be The Wall Street Journal, that
includes the specific U.S. Treasury security or securities (including
the CUSIP number and/or the principal terms of such Treasury security
or securities) described in clause (v) below, that must be delivered by
Holders of Normal Units that elect not to participate in the
remarketing pursuant to clause (v) below, no later than 10:00 a.m. (New
York City time) on the fourth Business Day preceding each of the
Initial Remarketing Date or the first day of any Subsequent Remarketing
Period, as the case may be. Not later than 15 nor more than 30 calendar
days prior to each of the Initial Remarketing Date and the first day of
any Subsequent Remarketing Period, the Company shall request the
Clearing Agency (or any successor Clearing Agency), to notify its
Beneficial Owners or Depositary Participants holding Normal Units or
Separate Notes of the impending remarketing. The Agent shall notify, by
10:00 a.m. (New York City time) on the third Business Day preceding
each of the Initial Remarketing Date or the first day of any Subsequent
Remarketing Period, as the case may be, the Remarketing Agent and the
Collateral Agent of the aggregate number of Notes of Normal Unit
Holders to be remarketed. The Collateral Agent will notify by 10:00
a.m. (New York City time) on the third Business Day immediately
preceding each of the Initial Remarketing Date or the first day of any
Subsequent Remarketing Period, as the case may be, the Remarketing
Agent of the aggregate number of Separate Notes to be remarketed. Upon
receipt of such notice from the Agent, the Remarketing Agent will on
the Initial Remarketing Date or a Subsequent Remarketing Date (other
than a Subsequent Remarketing Date that occurs on the third Business
Day prior to the Stock Purchase Date), as the case may be, use its
reasonable best efforts to (i) establish a rate of interest that, in
the opinion of the Remarketing Agent, will, when applied to the Notes
(assuming, even if not true, that all of the Notes are included in the
remarketing), enable the then current aggregate market value of the
Notes to have a value equal to 100.25% of the Remarketing Value
(assuming for the purpose of this calculation, even if not true, that
all of the Notes are included in the remarketing), as of the
Remarketing Date, provided that in no event shall the Reset Rate be
less than the initial rate borne by the Notes and will not exceed the
maximum rate permitted by state usury laws and other applicable laws
(such rate and the rate specified in Section 5.4(b)(iii), the "Reset
Rate"), and (ii) sell such Notes on such date at a price equal to at
least 100.25% of the Remarketing Value. In the case of a successful
remarketing prior to the third Business Day prior to the Stock Purchase
Date, the Remarketing Agent will use the proceeds from a successful
remarketing to purchase in open market transactions or at Treasury
auction the appropriate U.S. Treasury securities (the "Agent-purchased
Treasury Consideration") with the CUSIP numbers, if any, selected by
the Remarketing Agent, described in clauses (b)(1) and (b)(2) of the
definition of Remarketing Value related to the Notes of Holders of
Normal Units that were remarketed. On or prior to the third Business
Day following the Initial Remarketing Date or a Subsequent Remarketing
Date (other than a Subsequent Remarketing Period that occurs on the
third Business Day prior to the Stock Purchase Date), as the case may
be, the Remarketing Agent shall deliver such Agent-purchased Treasury
Consideration to the Agent, which shall thereupon deliver such
Agent-purchased Treasury Consideration to the Collateral Agent. The
Collateral Agent, for the benefit of the Company, will thereupon apply
such Agent-purchased Treasury Consideration, in accordance with the
Pledge Agreement, to secure such Holders' obligations under the
Purchase Contracts. In the case of a successful remarketing on the
third Business Day prior to the Stock Purchase Date, the Remarketing
Agent will cause the Cash Proceeds from such successful remarketing to
be remitted, along with notification thereof, to the Agent for the
benefit of the Holders of such remarketed Notes, which shall thereupon
deliver such Cash Proceeds to the Collateral Agent. The Collateral
Agent, for the benefit of the Company, will thereupon apply such Cash
Proceeds, in accordance with the Pledge Agreement, to secure such
Holders' obligations under the Purchase Contracts. In connection with
any successful remarketing, the Remarketing Agent will deduct as a
remarketing fee an amount not exceeding 25 basis points (.25%) of the
total proceeds from the remarketing (the "Remarketing Fee"). The
Remarketing Agent will remit (1) the portion of the proceeds from the
remarketing attributable to the Separate Notes to the holders of
Separate Notes that were remarketed and (2) the remaining portion of
the proceeds, in each case, less those proceeds used to purchase the
Agent-purchased Treasury Consideration to the Holders of the Normal
Units that were remarketed, all determined on a pro rata basis, in each
case, on or prior to the third Business Day immediately following the
Initial Remarketing Date or a Subsequent Remarketing Date, as the case
may be. Holders whose Notes are so remarketed will not otherwise be
responsible for the payment of any Remarketing Fee in connection
therewith. If such successful remarketing is consummated after 4:30
p.m. (New York City time) on such Remarketing Date and, despite using
its commercially reasonable efforts, the Remarketing Agent cannot cause
the applications of the proceeds specified above to occur on such
Remarketing Date, then the Remarketing Agent may make such applications
and remittances on the next succeeding Business Day.
38
(ii) If, despite its reasonable best efforts, the
Remarketing Agent cannot establish a Reset Rate on the Initial
Remarketing Date so as to allow the Remarketing Agent to
remarket the Notes offered for remarketing on such date at a
price equal to 100.25% of the Remarketing Value, the
Remarketing Agent will attempt to establish a Reset Rate
meeting these requirements on each of the three Business Day
periods immediately preceding each of June 16, 2005 and July
14, 2005 and on the three Business Day period ending on and
including the third Business Day immediately preceding August
16, 2005 (each a "Subsequent Remarketing Period"). If the
Remarketing Agent cannot remarket the Notes included in the
remarketing on the Initial Remarketing Date or during any
Subsequent Remarketing Period at a price equal to at least
100.25% of the Remarketing Value or the Remarketing Agent has
determined that the remarketing may not be commenced or
consummated pursuant to applicable law, the remarketing will
be deemed to have failed (each, a "Terminated Remarketing
Period"). If, in spite of using its reasonable best efforts,
the Remarketing Agent fails to remarket the Notes underlying
the Normal Units at least 100.25% of the Remarketing Value in
accordance with the terms of the Pledge Agreement by 4:00 p.m.
(New York City time) on the third Business Day immediately
preceding the Stock Purchase Date or the Remarketing Agent has
determined that the remarketing may not be commenced or
consummated pursuant to applicable law, the remarketing will
be deemed to have failed, the "Last Failed Remarketing" will
be deemed to have occurred.
39
(iii) In the event of a Last Failed Remarketing and
the Notes have not been earlier redeemed pursuant to a Tax
Event Redemption, the Remarketing Agent shall determine the
Reset Rate that shall apply to the Notes according to the
following method, provided that in no event shall the Reset
Rate be less than the initial rate borne by the Notes and will
not exceed the maximum rate permitted by state usury and other
applicable laws. In such event, the Remarketing Agent will
take the average of the interest rates quoted to it by three
nationally recognized investment banks selected by the
Company, which are underwriters or dealers in debt securities
similar to the Notes, that in their judgment reflects an
accurate market rate of interest applicable to the Notes at
that time such that they would, after such resetting, trade at
par. Following receipt of these quotes, the Remarketing Agent
will have the right, in its sole judgment, to either
recalculate the average based on only two of the quoted
interest rates if one of the three quotes, in the Remarketing
Agent's sole discretion, did not reflect market conditions or,
alternatively, determine a consensus among the investment
banks rather than a strict mathematical average by taking into
account all relevant qualitative and quantitative factors.
These factors may include, but shall not limited to, maturity
of the Notes, the credit rating and credit risk of the Company
and companies of similar industries, the then yield to
maturity of the Notes and the state of the markets for primary
and secondary sales of similar debt securities.
If a Terminated Remarketing Period occurs,
the Remarketing Agent will, pursuant to the Remarketing
Agreement, promptly advise the Trustee, the Agent, the
Collateral Agent, the Company and the Depositary that a
Terminated Remarketing Period has occurred. The Company will
cause a notice of any Terminated Remarketing Period, the Last
Failed Remarketing and the Reset Rate to be published not
later than the fourth Business Day following the Initial
Remarketing Date or a Subsequent Remarketing Date and the date
of the Last Failed Remarketing, as the case may be, in a daily
newspaper in the English language of general circulation in
The City of New York, which is expected to be The Wall Street
Journal. The Company will also release this information by
means of Bloomberg and Reuters newswire or, if not available,
by similar means.
(iv) With respect to any Notes which constitute part
of Normal Units which are subject to the Last Failed
Remarketing, the Collateral Agent for the benefit of the
Company reserves all of its rights as a secured party with
respect thereto and, subject to applicable law and Section
5.4(e) below, may, among other things, foreclose on and retain
such Notes for the benefit of the Company and permit the
Company to cause the Notes to be sold or to retain and cancel
such Notes, in either case, in full satisfaction of such
Holders' obligations under the Purchase Contracts; provided,
that if upon the Last Failed Remarketing, the Collateral Agent
delivers the Notes to the Company in full satisfaction of the
Holder's obligation under the Purchase Contract, any accrued
and unpaid interest on such Notes will become payable by the
Company to the Agent for payment to the Holder of the Normal
Units to which such Notes relate. Such payment will be made by
the Company on or prior to 5:00 p.m. (New York City time) on
the Stock Purchase Date in Cash by certified or cashier's
check or wire transfer in immediately available funds payable
to or upon the order of the Agent.
40
(v) A Holder of Normal Units may elect not to
participate in the remarketing and retain the Notes underlying
such Units by (A) delivering written notice to the Agent,
substantially in the form of Exhibit D hereto (including the
CUSIP number and/or the principal terms of such security or
securities), stating that the Holder has Transferred the
specific U.S. Treasury security or securities identified by
the Agent that constitute the U.S. Treasury securities
described in clauses (a) and (b) of the definition of
Remarketing Value relating to the retained Notes (the "Opt-out
Treasury Consideration") to the Agent and (B) delivering such
Opt-out Treasury Consideration to the Agent, provided that
such Holder may not make this election after 10:00 a.m. (New
York City time) on: (i) the fourth Business Day immediately
preceding the Initial Remarketing Date until the Business Day
immediately following such Initial Remarketing Date; (ii) the
fourth Business Day immediately preceding the first day of the
Subsequent Remarketing Period ending June 16, 2005 or July 14,
2005 until the Business Day immediately following such
Remarketing Period; or (iii) on the tenth Business Day
immediately preceding the Stock Purchase Date, as the case may
be. Upon receipt thereof by the Agent, the Agent shall deliver
such Opt-out Treasury Consideration to the Collateral Agent.
The Collateral Agent will hold Opt-out Treasury Consideration
in an account separate from the Collateral Account. On the
Remarketing Settlement Date, the Collateral Agent, for the
benefit of the Company shall thereupon transfer to the
Collateral Account such Opt-out Treasury Consideration to
secure such Normal Units Holder's obligations under their
applicable Purchase Contract constituting a part of the
Holder's Normal Units, in substitution for the Pledged Notes
and to fund the quarterly interest payment due to such Holders
on the Stock Purchase Date and deliver the applicable Notes to
these Holders. On the first Business Day, immediately
following a Terminated Remarketing Period, the Collateral
Agent will Transfer the Opt-out Treasury Consideration to the
Agent and the Agent will transfer promptly such Opt-out
Treasury Consideration to the appropriate Holders. A Holder
that does not so deliver the Opt-out Treasury Consideration
pursuant to this clause (v) shall be deemed to have elected to
participate in the remarketing.
(vi) Pursuant to the Indenture, a Holder of Separate
Note(s) may elect to participate in the remarketing by
delivering its Separate Notes along with notice of its
election, substantially in the form of Exhibit B of the First
Supplemental Indenture, to the Collateral Agent at any time,
provided that such Holder may not make such election after
10:00 a.m. (New York City time) on (i) the fourth Business Day
immediately preceding the Initial Remarketing Date until the
Business Day immediately following such Initial Remarketing
Date; (ii) the fourth Business Day immediately preceding the
first day of the Subsequent Remarketing Period ending June 16,
2005 or July 14, 2005 until the Business Day immediately
following such Remarketing Period; or (iii) on the tenth
Business Day immediately preceding the Stock Purchase Date.
The Collateral Agent will hold these Notes in an account
separate from the Collateral Account pursuant to the Pledge
Agreement. Holders of Separate Notes that have elected
previously to have their Separate Notes remarketed will have
the right to withdraw that election prior to 10:00 a.m. (New
York City time) on (i) the fourth Business Day immediately
preceding the Initial Remarketing Date until the Business Day
immediately following such Initial Remarketing Date; (ii) the
fourth Business Day immediately preceding the first day of the
Subsequent Remarketing Period ending June 16, 2005 or July 14,
2005 until the Business Day immediately following such
Remarketing Period; or (iii) on the tenth Business Day
immediately preceding the Stock Purchase Date. Within three
Business Days following (A) the applicable Remarketing Date,
if the remarketing was successful, the Remarketing Agent will
notify the Collateral Agent of the successful remarketing and
request that the Separate Notes be delivered to the purchasers
thereof on the Remarketing Settlement Date, and (B) either a
Terminated Remarketing Period or a Last Failed Remarketing,
the Collateral Agent will return the Separate Notes to their
Holders.
41
(c) Upon the maturity of the Pledged Treasury Securities
underlying the Stripped Units and the Pledged Applicable Ownership
Interest in the Treasury Portfolio, underlying the Normal Units, the
Collateral Agent shall invest the Proceeds promptly in Permitted
Investments and pay to the Company, on the Stock Purchase Date, an
amount equal to the aggregate Purchase Price applicable to such Units,
as payment for the Common Stock issuable upon settlement thereof
without receiving any instructions from the Holders of such Units. Any
such Proceeds received by the Collateral Agent in excess of the
Purchase Price and any funds received by the Collateral Agent in
respect of the investment earnings from the investment in such
Permitted Investments will be distributed to the Agent when received
for payment to the Holders and the Agent shall promptly cause such
excess proceeds to be distributed on a pro rata basis to such Holders.
(d) Any distribution to Holders of excess funds and interest
described in Section 5.4(b) and (c) above shall be payable at the
office of the Agent in The City of New York maintained for that purpose
or, at the option of the Holder or the holder of Separate Notes, as
applicable, by check mailed to the address of the Person entitled
thereto at such address as it appears on the Register or by wire
transfer to an account specified by the Holder or the holder of
Separate Notes, as applicable.
(e) The obligations of each Holder to pay the Purchase Price
are non-recourse obligations and except to the extent paid by Early
Settlement, Merger Early Settlement or Cash Settlement, are payable
solely out of the Proceeds of any Collateral pledged to secure the
obligations of the Holders and in no event will Holders be liable for
any deficiency between such payments and the Purchase Price.
42
(f) Notwithstanding anything to the contrary herein, the
Company shall not be obligated to issue any Common Stock in respect of
a Purchase Contract or deliver any certificates therefor to the Holder
of the related Unit unless the Company shall have received payment in
full for the shares of Common Stock to be purchased thereunder by such
Holder in the manner herein set forth.
(g) Pursuant to the Indenture and this Article, in the event
of a successful remarketing, the interest rate on all of the
outstanding Notes (whether or not included in the remarketing) shall be
adjusted to the Reset Rate and, in the event of a Last Failed
Remarketing, the interest rate on all Separate Notes shall be adjusted
to the Reset Rate as set forth in Section 5.4(b)(iii).
Section 5.5 Issuance of Shares of Common Stock.
Unless a Termination Event shall have occurred on or prior to
the Stock Purchase Date, or an Early Settlement or a Merger Early Settlement
shall have occurred, on the Stock Purchase Date, upon its receipt of payment for
the shares of Common Stock purchased by the Holders pursuant to the foregoing
provisions of this Article and subject to Section 5.6, the Company shall issue
and deposit with the Agent, for the benefit of the Holders of the Outstanding
Units, one or more certificates representing the newly issued shares of Common
Stock registered in the name of the Agent (or its nominee) as custodian for the
Holders (such certificates for shares of Common Stock, together with any
dividends or distributions for which a record date and payment date for such
dividend or distribution has occurred after the Stock Purchase Date, being
hereinafter referred to as the "Purchase Contract Settlement Fund") to which the
Holders are entitled hereunder. Subject to the foregoing, upon surrender of a
Certificate to the Agent on or after the Stock Purchase Date, together with
settlement instructions thereon duly completed and executed, the Holder of such
Certificate shall be entitled to receive in exchange therefor a certificate
representing that number of whole shares of Common Stock which such Holder is
entitled to receive pursuant to the provisions of this Article V together with
cash in lieu of fractional shares as provided in Section 5.12 and any dividends
or distributions with respect to such shares constituting part of the Purchase
Contract Settlement Fund, but without any interest thereon, and the Certificate
so surrendered shall forthwith be cancelled. Such shares of Common Stock shall
be registered in the name of the Holder or the Holder's designee as specified in
the settlement instructions provided by the Holder to the Agent. If any shares
of Common Stock issued in respect of a Purchase Contract are to be registered to
a Person other than the Person in whose name the Certificate evidencing such
Purchase Contract is registered, no such registration shall be made unless the
Person requesting such registration has paid any transfer and other taxes
required by reason of such registration in a name other than that of the
registered Holder of such Certificate or has established to the satisfaction of
the Company that such tax either has been paid or is not payable.
Section 5.6 Adjustment of Settlement Rate.
(a) Adjustments for Dividends, Distributions, Stock Splits,
Etc.
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(1) Stock Dividends. In case the Company shall pay or make a dividend
or other distribution on the Common Stock in Common Stock, the Settlement Rate,
as in effect at the opening of business on the day following the date fixed for
the determination of stockholders entitled to receive such dividend or other
distribution shall be increased by dividing such Settlement Rate by a fraction
of which the numerator shall be the number of shares of Common Stock outstanding
at the close of business on the date fixed for such determination and the
denominator shall be the sum of such number of shares and the total number of
shares constituting such dividend or other distribution, such increase to become
effective immediately after the opening of business on the day following the
date fixed for such determination. For the purposes of this paragraph (1), the
number of shares of Common Stock at the time outstanding shall not include
shares held in the treasury of the Company but shall include any shares issuable
in respect of any share certificates issued in lieu of fractions of shares of
Common Stock. The Company will not pay any dividend or make any distribution on
shares of Common Stock held in the treasury of the Company.
(2) Stock Purchase Rights. In case the Company shall issue rights,
options or warrants, other than pursuant to any dividend reinvestment plan or
share purchase plan, to all holders of its Common Stock (not being available on
an equivalent basis to Holders of the Securities upon settlement of the Purchase
Contracts underlying such Securities) entitling them, for a period expiring
within 45 days after the record date for the determination of stockholders
entitled to receive such rights, options or warrants, to subscribe for or
purchase shares of Common Stock at a price per share less than the Current
Market Price per share of the Common Stock on the date fixed for the
determination of stockholders entitled to receive such rights, options or
warrants (other than pursuant to a dividend reinvestment plan or share purchase
plan), the Settlement Rate in effect at the opening of business on the day
following the date fixed for such determination shall be increased by dividing
such Settlement Rate by a fraction of which (i) the numerator shall be the
number of shares of Common Stock outstanding at the close of business on the
date fixed for such determination plus the number of shares of Common Stock
which the aggregate offering price of the total number of shares of Common Stock
so offered for subscription or purchase would purchase at such Current Market
Price and (ii) the denominator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination
plus the number of shares of Common Stock so offered for subscription or
purchase, such increase to become effective immediately after the opening of
business on the day following the date fixed for such determination. For
purposes of this paragraph (2), the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the Company but
shall include any shares issuable in respect of any share certificates issued in
lieu of fractions of shares of Common Stock. The Company shall not issue any
such rights, options or warrants in respect of shares of Common Stock held in
the treasury of the Company.
(3) Stock Splits; Reverse Splits. In case outstanding shares of Common
Stock shall be subdivided or split into a greater number of shares of Common
Stock, the Settlement Rate in effect at the opening of business on the day
following the day upon which such subdivision or split becomes effective shall
be proportionately increased, and, conversely, in case outstanding shares of
Common Stock shall each be combined into a smaller number of shares of Common
Stock, the Settlement Rate in effect at the opening of business on the day
following the day upon which such combination becomes effective shall be
proportionately reduced, such increase or reduction, as the case may be, to
become effective immediately after the opening of business on the day following
the day upon which such subdivision, split or combination becomes effective.
44
(4) Debt or Asset Distributions. In case the Company shall, by dividend
or otherwise, distribute to all holders of its Common Stock evidences of its
indebtedness or assets (including securities, but excluding any rights or
warrants referred to in paragraph (2) of this Section, any dividend or
distribution paid exclusively in cash and any dividend, shares of capital stock
of any class or series, or similar equity interests, of or relating to a
subsidiary or other business unit in the case of a Spin-Off referred to in
paragraph (5) of this Section, or distribution referred to in paragraph (1) of
this Section), the Settlement Rate shall be adjusted so that the same shall
equal the rate determined by dividing the Settlement Rate in effect immediately
prior to the close of business on the date fixed for the determination of
stockholders entitled to receive such distribution by a fraction, the numerator
of which shall be the Current Market Price per share of the Common Stock on the
date fixed for such determination less the then fair market value (as reasonably
determined by the Board of Directors, whose determination shall be conclusive
and the basis for which shall be described in a Board Resolution) of the portion
of the assets or evidences of indebtedness so distributed applicable to one
share of Common Stock and the denominator of which shall be such Current Market
Price per share of the Common Stock, such adjustment to become effective
immediately prior to the opening of business on the day following the date fixed
for the determination of stockholders entitled to receive such distribution. In
any case in which this paragraph (4) is applicable, paragraph (2) of this
Section shall not be applicable.
(5) Spin-Off. In the case of a Spin-Off, the Settlement Rate as in
effect immediately before the close of business on the record date fixed for
determination of stockholders entitled to receive that distribution shall be
increased by multiplying the Settlement Rate by a fraction, the numerator of
which is the Current Market Price per share of the Common Stock plus the Fair
Market Value of the portion of those shares of Capital Stock or similar equity
interests so distributed applicable to one share of Common Stock and the
denominator of which is the Current Market Price per share of the Common Stock.
Any adjustment to the Settlement Rate under this paragraph (5) will occur at the
earlier of (1) the tenth Trading Day from, and including, the effective date of
the Spin-Off and (2) the date of the securities being offered in the initial
public offering of the Spin-Off, if that initial public offering is effected
simultaneously with the Spin-Off.
(6) Cash Distributions. In case the Company shall, (i) by dividend or
otherwise, distribute to all holders of its Common Stock cash (excluding any
cash that is distributed in a Reorganization Event to which Section 5.6(b)
applies or as part of a distribution referred to in paragraph (4) of this
Section) in an aggregate amount that, combined together with (ii) the aggregate
amount of any other distributions to all holders of its Common Stock made
exclusively in cash within the 12 months preceding the date of payment of such
distribution and in respect of which no adjustment pursuant to this paragraph
(6) or paragraph (7) of this Section has been made and (iii) the aggregate of
any cash plus the fair market value as of the date of the expiration of the
tender or exchange offer referred to below (as reasonably determined by the
Board of Directors, whose determination shall be conclusive and the basis for
which shall be described in a Board Resolution) of consideration payable in
respect of any tender or exchange offer by the Company or any of its
subsidiaries for all or any portion of the Common Stock concluded within the 12
months preceding the date of payment of the distribution described in clause (i)
above and in respect of which no adjustment pursuant to this paragraph (5) or
paragraph (6) of this Section has been made, exceeds 15% of the product of the
Current Market Price per share of the Common Stock on the date for the
determination of holders of shares of Common Stock entitled to receive such
distribution times the number of shares of Common Stock outstanding on such
date, then, and in each such case, immediately after the close of business on
such date for determination, the Settlement Rate shall be increased so that the
same shall equal the rate determined by dividing the Settlement Rate in effect
immediately prior to the close of business on the date fixed for determination
of the stockholders entitled to receive such distribution by a fraction (A) the
numerator of which shall be equal to the Current Market Price per share of the
Common Stock on the date fixed for such determination less an amount equal to
the quotient of (x) the combined amount distributed or payable in the
transactions described in clauses (i), (ii) and (iii) above and (y) the number
of shares of Common Stock outstanding on such date for determination and (B) the
denominator of which shall be equal to the Current Market Price per share of the
Common Stock on such date for determination.
45
(7) Tender Offers. In case (i) a tender or exchange offer made by the
Company or any subsidiary of the Company for all or any portion of the Common
Stock shall expire and such tender or exchange offer (as amended upon the
expiration thereof) shall require the payment to stockholders (based on the
acceptance (up to any maximum specified in the terms of the tender or exchange
offer) of Purchased Shares) of an aggregate consideration having a fair market
value (as reasonably determined by the Board of Directors, whose determination
shall be conclusive and the basis for which shall be described in a Board
Resolution) that combined together with (ii) the aggregate of the cash plus the
fair market value (as determined by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution), as of the expiration
of such tender or exchange offer, of consideration payable in respect of any
other tender or exchange offer, by the Company or any subsidiary of the Company
for all or any portion of the Common Stock expiring within the 12 months
preceding the expiration of such tender or exchange offer and in respect of
which no adjustment pursuant to paragraph (6) of this Section or this paragraph
(7) has been made and (iii) the aggregate amount of any distributions to all
holders of the Company's Common Stock made exclusively in cash within the 12
months preceding the expiration of such tender or exchange offer and in respect
of which no adjustment pursuant to paragraph (6) of this Section or this
paragraph (7) has been made, exceeds 15% of the product of the Current Market
Price per share of the Common Stock as of the last time (the "Expiration Time")
tenders could have been made pursuant to such tender or exchange offer (as it
may be amended) times the number of shares of Common Stock outstanding
(including any tendered shares) on the Expiration Time, then, and in each such
case, immediately prior to the opening of business on the day after the date of
the Expiration Time, the Settlement Rate shall be adjusted so that the same
shall equal the rate determined by dividing the Settlement Rate immediately
prior to the close of business on the date of the Expiration Time by a fraction
(A) the numerator of which shall be equal to (x) the product of (I) the Current
Market Price per share of the Common Stock on the date of the Expiration Time
and (II) the number of shares of Common Stock outstanding (including any
tendered shares) on the Expiration Time less (y) the amount of cash plus the
fair market value (determined as aforesaid) of the aggregate consideration
payable to stockholders based on the transactions described in clauses (i), (ii)
and (iii) above (assuming in the case of clause (i) the acceptance, up to any
maximum specified in the terms of the tender or exchange offer, of Purchased
Shares), and (B) the denominator of which shall be equal to the product of (x)
the Current Market Price per share of the Common Stock as of the Expiration Time
and (y) the number of shares of Common Stock outstanding (including any tendered
shares) as of the Expiration Time less the number of all shares validly tendered
and not withdrawn as of the Expiration Time (the shares deemed so accepted, up
to any such maximum, being referred to as the "Purchased Shares").
46
(8) Reclassification. The reclassification of Common Stock into
securities including securities other than Common Stock (other than any
reclassification upon a Reorganization Event to which Section 5.6(b) applies)
shall be deemed to involve (i) a distribution of such securities other than
Common Stock to all holders of Common Stock (and the effective date of such
reclassification shall be deemed to be "the date fixed for the determination of
stockholders entitled to receive such distribution" and the "date fixed for such
determination" within the meaning of paragraph (4) of this Section), and (ii) a
subdivision, split or combination, as the case may be, of the number of shares
of Common Stock outstanding immediately prior to such reclassification into the
number of shares of Common Stock outstanding immediately thereafter (and the
effective date of such reclassification shall be deemed to be "the day upon
which such subdivision or split becomes effective" or "the day upon which such
combination becomes effective," as the case may be, and "the day upon which such
subdivision, split or combination becomes effective" within the meaning of
paragraph (3) of this Section).
(9) "Current Market Price." The "Current Market Price" of the Common
Stock means (a) on any day the average of the Sales Prices for the 5 consecutive
Trading Days preceding the earlier of the day preceding the day in question and
the day before the "ex date" with respect to the issuance or distribution
requiring computation, (b) in the case of any Spin-Off that is effected
simultaneously with and Initial Public Offering of the securities being
distributed in the Spin-Off, the Sale Price of the Common Stock on the Trading
Day on which the initial public offering price of the securities being
distributed in the Spin-Off is determined, and (c) in the case of any other
Spin-Off, the average of the Sale Prices of the Common Stock over the first 10
Trading Days after the effective date of such Spin-Off. For purposes of this
paragraph, the term "ex date," when used with respect to any issuance or
distribution, shall mean the first date on which the Common Stock trades regular
way on such exchange or in such market without the right to receive such
issuance or distribution.
(10) Calculation of Adjustments. All adjustments to the Settlement Rate
shall be calculated to the nearest 1/10,000th of a share of Common Stock (or if
there is not a nearest 1/20,000th of a share to the next lower 1/10,000th of a
share). No adjustment in the Settlement Rate shall be required unless such
adjustment would require an increase or decrease of at least one percent
therein; provided, that any adjustments which by reason of this subparagraph are
not required to be made shall be carried forward and taken into account in any
subsequent adjustment. If an adjustment is made to the Settlement Rate pursuant
to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of this Section 5.6(a),
an adjustment shall also be made to the Applicable Market Value solely to
determine which of clauses (i), (ii) or (iii) of the definition of Settlement
Rate in Section 5.1(a) will apply on the Stock Purchase Date. Such adjustment
shall be made by multiplying the Applicable Market Value by a fraction, the
numerator of which shall be the Settlement Rate immediately after such
adjustment pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of
this Section 5.6(a) and the denominator of which shall be the Settlement Rate
immediately before such adjustment; provided, that if such adjustment to the
Settlement Rate is required to be made pursuant to the occurrence of any of the
events contemplated by paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of
this Section 5.6(a) during the period taken into consideration for determining
the Applicable Market Value, appropriate and customary adjustments shall be made
to the Settlement Rate.
47
(11) Increase of Settlement Rate. The Company may make such increases
in the Settlement Rate, in addition to those required by this Section, as it
considers to be advisable in order to avoid or diminish any income tax to any
holders of shares of Common Stock resulting from any dividend or distribution of
stock or issuance of rights or warrants to purchase or subscribe for stock or
from any event treated as such for income tax purposes or for any other reasons.
(b) Adjustment for Consolidation, Merger or Other
Reorganization Event.
(1) In the event of:
(i) any consolidation or merger of the Company with
or into another Person (other than a merger or consolidation
in which the Company is the continuing corporation and in
which the Common Stock outstanding immediately prior to the
merger or consolidation is not exchanged for cash, securities
or other property of the Company or another corporation),
(ii) any sale, transfer, lease or conveyance to
another Person of the property of the Company as an entirety
or substantially as an entirety,
(iii) any statutory exchange of securities of the
Company with another Person (other than in connection with a
merger or acquisition), or
(iv) any liquidation, dissolution or winding up of
the Company other than as a result of or after the occurrence
of a Termination Event
(any such event described in clauses (i) through (iv) above, a
"Reorganization Event"),
each share of Common Stock covered by each Purchase Contract forming a part of a
Unit immediately prior to such Reorganization Event shall, after such
Reorganization Event, be converted for purposes of the Purchase Contract into
the kind and amount of securities, cash and other property receivable in such
Reorganization Event (without any interest thereon, and without any right to
dividends or distribution thereon which have a record date that is prior to the
Stock Purchase Date) per share of Common Stock by a holder of Common Stock that
(i) is not a Person with which the Company consolidated or into which the
Company merged or which merged into the Company or to which such sale or
transfer was made, as the case may be (any such Person, a "Constituent Person"),
or an Affiliate of a Constituent Person to the extent such Reorganization Event
provides for different treatment of Common Stock held by Affiliates of the
Company and non-Affiliates, and (ii) failed to exercise his rights of election,
if any, as to the kind or amount of securities, cash and other property
receivable upon such Reorganization Event (provided that if the kind or amount
of securities, cash and other property receivable upon such Reorganization Event
is not the same for each share of Common Stock held immediately prior to such
Reorganization Event by other than a Constituent Person or an Affiliate thereof
and in respect of which such rights of election shall not have been exercised
("Non-electing Share"), then for the purpose of this Section the kind and amount
of securities, cash and other property receivable upon such Reorganization Event
by each Non-electing Share shall be deemed to be the kind and amount so
receivable per share by a plurality of the Non-electing Shares). On the Stock
Purchase Date, the Settlement Rate then in effect will be applied to the value
on the Stock Purchase Date of such securities, cash or other property, as the
case may be.
48
In the event of such a Reorganization Event, the Person formed
by such consolidation, merger or exchange or the Person which acquires the
assets of the Company or, in the event of a liquidation or dissolution of the
Company, the Company or a liquidating trust created in connection therewith,
shall execute and deliver to the Agent an agreement supplemental hereto
providing that the Holder of each Outstanding Unit shall have the rights
provided by this Section 5.6. Such supplemental agreement shall provide for
adjustments which, for events subsequent to the effective date of such
supplemental agreement, shall be as nearly equivalent as may be practicable to
the adjustments provided for in this Section. The above provisions of this
Section shall similarly apply to successive Reorganization Events.
Section 5.7 Notice of Adjustments and Certain Other Events.
(a) Whenever the Settlement Rate is adjusted as herein
provided, the Company shall:
(i) forthwith compute the Settlement Rate and the
Applicable Market Value in accordance with Section 5.6 and
prepare and transmit to the Agent an Officer's Certificate
setting forth the Settlement Rate and the Applicable Market
Value, the method of calculation thereof in reasonable detail,
and the facts requiring such adjustment and upon which such
adjustment is based; and
(ii) as soon as practicable following the occurrence
of an event that requires an adjustment to the Settlement Rate
pursuant to Section 5.6 (or if the Company is not aware of
such occurrence, as soon as practicable after becoming so
aware), provide a written notice to the Holders of the Units
of the occurrence of such event and a statement in reasonable
detail setting forth the method by which the adjustment to the
Settlement Rate and the Applicable Market Value was determined
and setting forth the adjusted Settlement Rate and the
Applicable Market Value.
(b) The Agent shall not at any time be under any duty or
responsibility to any Holder of Units to determine whether any facts
exist which may require any adjustment of the Settlement Rate and the
Applicable Market Value, or with respect to the nature or extent or
calculation of any such adjustment when made, or with respect to the
method employed in making the same. The Agent shall not be accountable
with respect to the validity or value (or the kind or amount) of any
shares of Common Stock, or of any securities or property, which may at
the time be issued or delivered with respect to any Purchase Contract;
and the Agent makes no representation with respect thereto. The Agent
shall not be responsible for any failure of the Company to issue,
transfer or deliver any shares of Common Stock pursuant to a Purchase
Contract or to comply with any of the duties, responsibilities or
covenants of the Company contained in this Article.
49
Section 5.8 Termination Event; Notice.
The Purchase Contracts and all obligations and rights of the
Company and the Holders thereunder, including the rights and obligations of
Holders to purchase Common Stock, shall immediately and automatically terminate,
without the necessity of any notice or action by any Holder, the Agent or the
Company, if, on or prior to the Stock Purchase Date, a Termination Event shall
have occurred. Upon and after the occurrence of a Termination Event, the Normal
Units shall thereafter represent the right to receive the Pledged Notes or the
Applicable Ownership Interest in the Treasury Portfolio, as the case may be,
forming a part of such Normal Units, and the Stripped Units shall thereafter
represent the right to receive the Pledged Treasury Securities forming a part of
such Stripped Units, in each case in accordance with the provisions of Section
4.3 of the Pledge Agreement. Upon the occurrence of a Termination Event, the
Company shall promptly but in no event later than two Business Days thereafter
give written notice to the Agent, the Collateral Agent and to the Holders, at
their addresses as they appear in the Register.
Section 5.9 Early Settlement.
(a) Unless a Holder has effected a Merger Early Settlement or
a Termination Event shall have occurred, subject to and upon compliance
with the provisions of this Section 5.9, Purchase Contracts underlying
Units having an aggregate Stated Amount equal to $1,000 or an integral
multiple thereof, may, at the option of the Holder thereof, be settled
early ("Early Settlement") at any time, provided that Holders may not
settle early after 10:00 a.m. (New York City time) (i) on the fourth
Business Day immediately preceding the Initial Remarketing Date until
the next Business Day immediately following such Initial Remarketing
Date; (ii) on the fourth Business Day immediately preceding the first
day of a Subsequent Remarketing Period ending on June 16, 2005 or July
14, 2005 until the next Business Day immediately following such
Remarketing Period or (iii) after the tenth Business Day immediately
preceding the Stock Purchase Date. In order to exercise the right to
effect Early Settlement with respect to any Purchase Contract, the
Holder of the Certificate evidencing the related Unit shall deliver
such Certificate to the Agent at the Corporate Trust Office an
"Election to Settle Early" form on the reverse side of the Certificate
and any other documents requested by the Agent and accompanied by
payment payable to the Company in immediately available funds in an
amount (the "Early Settlement Amount") equal to the product of (i) the
Stated Amount of such Units multiplied by (ii) the number of Purchase
Contracts with respect to which the Holder has elected to effect Early
Settlement within the time frames specified in the preceding sentence.
If the foregoing requirements are first satisfied with respect to
Purchase Contracts underlying any Unit at or prior to 5:00 p.m. (New
York City time) on a Business Day, such day shall be the "Early
Settlement Date" with respect to such Unit and if such requirements are
first satisfied after 5:00 p.m. (New York City time) on a Business Day
or on a day that is not a Business Day, the "Early Settlement Date"
with respect to such Units shall be the next succeeding Business Day.
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(b) Upon payment of the Early Settlement Amount by the Holder
of the related Normal Units or Stripped Units, as the case may be, the
Company shall issue, and the Holder shall be entitled to receive,
2.3202 shares of Common Stock on account of such Purchase Contract (the
"Early Settlement Rate"). The Early Settlement Rate shall be adjusted
in the same manner and at the same time as the Settlement Rate is
adjusted pursuant to Section 5.6.
(c) No later than the third Business Day after the applicable
Early Settlement Date, the Company shall cause:
(i) the shares of Common Stock issuable upon Early
Settlement of Purchase Contracts to be issued and delivered;
and
(ii) the related Pledged Notes or Pledged Applicable
Ownership Interest in the Treasury Portfolio, in the case of
Normal Units, or the related Pledged Treasury Securities, in
the case of Stripped Units, to be released from the Pledge by
the Collateral Agent and transferred, in each case, to the
Agent for delivery to the Holder thereof or the Holder's
designee, pursuant to the Pledge Agreement.
(d) Upon Early Settlement of any Purchase Contracts, and
subject to receipt of shares of Common Stock from the Company and the
Pledged Notes, Pledged Applicable Ownership Interest (as specified in
clause (A) of the definition of Applicable Ownership Interest) in the
Treasury Portfolio, or Pledged Treasury Securities, as the case may be,
from the Collateral Agent, as applicable, the Agent shall, in
accordance with the instructions provided by the Holder thereof on the
applicable form of Election to Settle Early on the reverse of the
Certificate evidencing the related Units;
(i) transfer to the Holder the Pledged Notes, Pledged
Applicable Ownership Interest in the Treasury Portfolio, or
Pledged Treasury Securities, as the case may be, forming a
part of such Units pursuant to the Pledge Agreement; and
(ii) deliver to the Holder a certificate or
certificates for the full number of shares of Common Stock
issuable upon such Early Settlement together with payment in
lieu of any fraction of a share, as provided in Section 5.12.
(e) In the event that Early Settlement is effected with
respect to Purchase Contracts underlying less than all the Units
evidenced by a Certificate, upon such Early Settlement, the Company
shall execute and the Agent shall authenticate, execute and deliver to
the Holder thereof, at the expense of the Company, a Certificate
evidencing the Units as to which Early Settlement was not effected.
(f) The Company agrees that, if required under U.S. Federal
securities laws, it will use commercially reasonable efforts to (i)
have in effect a registration statement covering the shares of our
Common Stock to be delivered in respect of the Purchase Contracts being
settled and (ii) provide a prospectus in connection therewith, in each
case in a form that may be used in connection with the Early Settlement
pursuant to this Section 5.9.
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Section 5.10 Early Settlement Upon Merger.
(a) In the event of a merger or consolidation of the Company
of the type described in clause (1) of Section 5.6(b) in which the
Common Stock outstanding immediately prior to such merger or
consolidation is exchanged for consideration consisting of at least 30%
cash or cash equivalents (any such event, a "Cash Merger"), then the
Company (or the successor to the Company hereunder) shall be required
to offer the Holder of each Unit the right to settle the Purchase
Contract underlying such Unit prior to the Stock Purchase Date ("Merger
Early Settlement") as provided herein. On or before the fifth Business
Day after the consummation of a Cash Merger, the Company shall give all
Holders notice of the occurrence of the Cash Merger and of the right of
Merger Early Settlement arising as a result thereof. The Company shall
also deliver a copy of such notice to the Agent and the Collateral
Agent.
Each such notice shall contain:
(i) the date, which shall be 10 Business Days after
the date of such notice, on which the Merger Early Settlement
may be effected (the "Merger Early Settlement Date");
(ii) the date, which shall be on or by the third
Business Day prior to the Merger Early Settlement Date, by
which the Merger Early Settlement right must be exercised;
(iii) the Settlement Rate that will be in effect on
the Merger Early Settlement Date after giving effect to such
Cash Merger and the kind and amount of securities, cash and
other property receivable by the Holder upon settlement of
each Purchase Contract pursuant to Section 5.6(b);
(iv) a statement to the effect that all or a portion
of the Purchase Price payable by the Holder to settle the
Purchase Contract will be offset against the amount of cash so
receivable upon exercise of Merger Early Settlement, as
applicable; and
(v) the instructions a Holder must follow to exercise
the Merger Early Settlement right.
(b) To exercise a Merger Early Settlement right, a Holder
shall deliver to the Agent at the Corporate Trust Office on or before
5:00 p.m. (New York City time) on the third Business Day before the
Merger Early Settlement Date the Certificate(s) evidencing the Units
with respect to which the Merger Early Settlement right is being
exercised and, if the Holder holds physical Certificates, such Holder
shall deliver the Certificate(s) duly endorsed for transfer to the
Company or in blank with the form of Election to Settle Early on the
reverse thereof duly completed and, in each instance, accompanied by
payment payable to the Company in immediately available funds in an
amount equal to the Early Settlement Amount less the amount of cash
that otherwise would be deliverable by the Company or its successor
upon settlement of the Purchase Contract in lieu of Common Stock
pursuant to Section 5.6(b) and as described in the notice to Holders
(the "Merger Early Settlement Amount").
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(c) On the Merger Early Settlement Date, if the Company has
received the Merger Early Settlement Amount for the applicable number
of Purchase Contracts being settled by Merger Early Settlement, the
Company shall deliver or cause to be delivered (i) the net cash,
securities and other property to be received by such exercising Holder,
equal to the Settlement Rate as adjusted pursuant to Section 5.6, in
respect of the number of Purchase Contracts for which such Merger Early
Settlement right was exercised, and (ii) the related Pledged Notes or
Pledged Applicable Ownership Interest in the Treasury Portfolio, in the
case of Normal Units, or Pledged Treasury Securities, in the case of
Stripped Units, to be released from the Pledge by the Collateral Agent
and transferred, in each case, to the Agent for delivery to the Holder
thereof or its designee pursuant to the Pledge Agreement. In the event
a Merger Early Settlement right shall be exercised by a Holder in
accordance with the terms hereof, all references herein to Stock
Purchase Date shall be deemed to refer to such Merger Early Settlement
Date.
(d) Upon Merger Early Settlement of any Purchase Contracts,
and subject to receipt of such net cash, securities or other property
from the Company and the Pledged Notes, Pledged Applicable Ownership
Interest in the Treasury Portfolio or Pledged Treasury Securities, as
the case may be, from the Collateral Agent, as applicable, the Agent
shall, in accordance with the instructions provided by the Holder
thereof on the applicable form of Election to Settle Early on the
reverse of the Certificate evidencing the related Units, (i) transfer
to the Holder the Pledged Notes, Pledged Treasury Consideration,
Pledged Applicable Ownership Interest in the Treasury Portfolio, or
Pledged Treasury Securities, as the case may be, forming a part of such
Units, pursuant to the Pledge Agreement, and (ii) deliver to the Holder
such net cash, securities or other property issuable upon such Merger
Early Settlement together with payment in lieu of any fraction of a
share, as provided in Section 5.12.
(e) In the event that Merger Early Settlement is effected with
respect to Purchase Contracts underlying less than all the Units
evidenced by a Certificate, upon such Merger Early Settlement, the
Company (or the successor to the Company hereunder) shall execute and
the Agent shall authenticate, execute and deliver to the Holder
thereof, at the expense of the Company, a Certificate evidencing the
Units as to which Merger Early Settlement was not effected.
Section 5.11 Charges and Taxes.
The Company will pay all stock transfer and similar taxes
attributable to the initial issuance and delivery of the shares of Common Stock
pursuant to the Purchase Contracts provided, that the Company shall not be
required to pay any such tax or taxes which may be payable in respect of any
exchange of or substitution for a Certificate evidencing a Unit or any issuance
of a share of Common Stock in a name other than that of the registered Holder of
a Certificate surrendered in respect of the Units evidenced thereby, other than
in the name of the Agent, as custodian for such Holder, and the Company shall
not be required to issue or deliver such share certificates or Certificates
unless and until the Person or Persons requesting the transfer or issuance
thereof shall have paid to the Company the amount of such tax or shall have
established to the satisfaction of the Company that such tax has been paid.
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Section 5.12 No Fractional Shares.
No fractional shares or scrip representing fractional shares
of Common Stock shall be issued or delivered upon settlement on the Stock
Purchase Date or upon Early Settlement or Merger Early Settlement of any
Purchase Contracts. If Certificates evidencing more than one Purchase Contract
shall be surrendered for settlement at one time by the same Holder, the number
of full shares of Common Stock which shall be delivered upon settlement shall be
computed on the basis of the aggregate number of Purchase Contracts evidenced by
the Certificates so surrendered. Instead of any fractional share of Common Stock
which would otherwise be deliverable upon settlement of any Purchase Contracts
on the applicable Settlement Date or upon Early Settlement or Merger Early
Settlement, the Company, through the Agent, shall make a cash payment in respect
of such fractional shares in an amount equal to the value of such fractional
shares times the Applicable Market Value. The Company shall provide the Agent
from time to time with sufficient funds to permit the Agent to make all cash
payments required by this Section 5.12 in a timely manner.
ARTICLE 6
REMEDIES
Section 6.1 Unconditional Right of Holders to Purchase Common
Stock.
The Holder of any Unit shall have the right, which is absolute
and unconditional, to purchase Common Stock pursuant to the Purchase Contract
constituting a part of such Unit and to institute suit for the enforcement of
any such right to purchase Common Stock, and such rights shall not be impaired
without the consent of such Holder.
Section 6.2 Restoration of Rights and Remedies.
If any Holder has instituted any proceeding to enforce any
right or remedy under this Agreement and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to such Holder,
then and in every such case, subject to any determination in such proceeding,
the Company and such Holder shall be restored severally and respectively to
their former positions hereunder and thereafter all rights and remedies of such
Holder shall continue as though no such proceeding had been instituted.
Section 6.3 Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Certificates in the last
paragraph of Section 3.10, no right or remedy herein conferred upon or reserved
to the Holders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
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Section 6.4 Delay or Omission Not Waiver.
No delay or omission of any Holder to exercise any right or
remedy upon a default shall impair any such right or remedy or constitute a
waiver of any such right. Every right and remedy given by this Article or by law
to the Holders may be exercised from time to time, and as often as may be deemed
expedient, by such Holders.
Section 6.5 Undertaking for Costs.
All parties to this Agreement agree, and each Holder of a
Unit, by its acceptance of such Unit shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Agreement, or in any suit against the Agent for any
action taken, suffered or omitted by it as Agent, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in such suit, having
due regard to the merits and good faith of the claims or defenses made by such
party litigant; provided that the provisions of this Section shall not apply to
any suit instituted by the Company, to any suit instituted by the Agent, to any
suit instituted by any Holder, or group of Holders, holding in the aggregate
more than 10% of the Outstanding Units, or to any suit instituted by any Holder
for the enforcement of distributions on any Notes on any Purchase Contract on or
after the respective Payment Date therefor in respect of any Unit held by such
Holder, or for enforcement of the right to purchase shares of Common Stock under
the Purchase Contract constituting part of any Unit held by such Holder.
Section 6.6 Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
wherever enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of this Agreement; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law, but will suffer and permit the execution of every such power as
though no such law had been enacted.
ARTICLE 7
THE AGENT
Section 7.1 Certain Duties, Rights and Immunities.
(a) (i) The Agent shall act as agent for the Holders of the
Units hereunder with such powers as are specifically vested in
the Agent by the terms of this Agreement, the Pledge
Agreement, the Remarketing Agreement, the Notes and the Units,
and any documents evidencing thereof or related thereto (the
"Transaction Documents"), together with such other powers as
are reasonably incidental thereto.
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(ii) The Agent shall have no duties or
responsibilities except those expressly set forth in the
Transaction Documents and no implied covenants or obligations
shall be inferred from any Transaction Documents against the
Agent, nor shall the Agent be bound by the provisions of any
agreement by any party hereto beyond the specific terms
hereof.
(iii) In the absence of bad faith on its part, the
Agent shall be entitled conclusively to rely upon (x) any
certification, order, judgment, opinion, notice or other
communication (including, without limitation, any thereof by
telephone or facsimile) furnished to the Agent and conforming
to the requirement of the Transaction Document and reasonably
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), (y) the truth of the statements and the
correctness of the opinions expressed therein and (z) advice
and statements of legal counsel and other experts selected by
the Agent; but in the case of any such certificates or
opinions which by any provisions hereof are specifically
required to be furnished to such Agent, such Agent shall be
under a duty to examine the same to determine whether or not
they conform to the requirements of this Agreement.
(iv) The Agent as to any matters not expressly
provided for by any Transaction Document, shall in all cases
be fully protected in acting, or in refraining from acting,
hereunder or thereunder in accordance with instructions given
by the Company or the Holders in accordance with the
Transaction Documents.
(v) The Agent shall not be responsible for any
recitals contained in any Transaction Document, or in any
certificate or other document referred to or provided for in,
or received by it under, any Transaction Document or the
Units, or for the value, validity, effectiveness, genuineness,
enforceability or sufficiency of any Transaction Document
(other than as against the Agent) or the Units or any other
document referred to or provided for herein or therein or for
any failure by the Company, any Holder or any other Person
(except the Agent) to perform any of its obligations hereunder
or thereunder or for the perfection, priority or, except as
expressly required hereby, existence, validity, perfection or
maintenance of any security interest created under the Pledge
Agreement, or for the use or application by the Company of the
proceeds in respect of the Purchase Contracts.
(vi) The Agent shall not be required to initiate or
conduct any litigation or collection proceedings hereunder.
(vii) The Agent shall not be responsible for any
action taken or omitted to be taken by it in good faith
hereunder or under any other document or instrument referred
to or provided for herein or in connection herewith or
therewith, except for its own gross negligence or willful
misconduct.
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(viii) The Agent 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 Units or other rights
under any Transaction Document.
(b) No provision of any Transaction Document shall be
construed to relieve the Agent from liability for its own grossly
negligent action, its own grossly negligent failure to act, its own bad
faith, or its own willful misconduct, except that:
(i) this paragraph (b) shall not be construed to
limit the effect of paragraph (a) of this Section;
(ii) the Agent shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless
it shall be proved that the Agent was grossly negligent in
ascertaining the pertinent facts; and
(iii) in no event shall the Agent be required to
expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder,
or in the exercise of its rights or powers, if it shall have
reasonable grounds for believing that repayment of such funds
or adequate indemnity against such risk or liability is not
reasonably assured to it.
(c) In no event shall the Agent or its officers, employees or
agents be liable for any special, indirect, individual, punitive or
consequential loss or damages, lost profits or loss of business,
arising in connection with any Transaction Document, whether or not the
likelihood of such loss or damage was known to the Agent, and
regardless of the form of action.
(d) Whether or not therein expressly so provided, every
provision of every Transaction Document relating to the conduct or
affecting the liability of or affording protection to the Agent shall
be subject to the provisions of this Section.
(e) The Agent is authorized to execute and deliver this
Agreement and the Pledge Agreement and any supplement thereto in its
capacity as Agent.
(f) The Agent shall have no liability whatsoever for the
action or inaction of any Clearing Agency or any book-entry system
thereof. In no event shall any Clearing Agency or any book-entry system
thereof be deemed an agent or subcustodian of the Agent.
Section 7.2 Notice of Default.
Within 60 days after the occurrence of any default by the
Company hereunder of which a Responsible Officer of the Agent has actual
knowledge, the Agent shall transmit by mail to the Company and the Holders of
Units, as their names and addresses appear in the Register, notice of such
default hereunder, unless such default shall have been cured or waived;
provided, however, the Agent shall be protected in withholding such notice if
and so long as the board of directors, the executive committee and/or the
Responsible Officers of the Agent in good faith determines that the withholding
of such notice is in the interest of the Holders of the Units.
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Section 7.3 Certain Rights of Agent.
Subject to the provisions of Section 7.1:
(a) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by an Officer's Certificate, Issuer
Order or Issuer Request, and any resolution of the Board of Directors
of the Company may be sufficiently evidenced by a Board Resolution;
(b) whenever in the administration of this Agreement the Agent
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Agent (unless
other evidence be herein specifically prescribed) may, in the absence
of negligence or bad faith on its part, rely upon an Officer's
Certificate of the Company;
(c) the Agent may consult with counsel of its choice and the
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in reliance
thereon;
(d) the Agent shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness
or other paper or document, but the Agent, in its discretion, may make
reasonable further inquiry or investigation into such facts or matters
as it may see fit, and, if the Agent shall determine to make such
further inquiry or investigation, it shall be given a reasonable
opportunity to examine the books, records and premises of the Company,
personally or by agent or attorney at the sole cost of the Company and
shall incur no liability or additional liability of any kind by reason
of such inquiry or investigation; and
(e) the Agent may execute any of the powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys or an Affiliate of the Agent and the Agent shall not be
responsible for any misconduct or negligence on the part of any agent
or attorney or an Affiliate appointed with due care by it hereunder.
Section 7.4 Not Responsible for Recitals, Etc.
The recitals contained herein and in the Certificates shall be
taken as the statements of the Company.
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Section 7.5 May Hold Units and Other Dealings.
Any Registrar or any other agent of the Company, or the Agent
and its Affiliates, in their individual or any other capacity, may become the
owner or pledgee of Units and may otherwise deal with the Company, the
Collateral Agent or any other Person with the same rights it would have if it
were not Registrar or such other agent, or the Agent. The Agent and its
Affiliates may (without having to account therefor to the Company or any Holder
of Units or holder of Separate Notes) accept deposits from, lend money to, make
their investments in and generally engage in any kind of banking, trust or other
business with the Company, any Holder of Units and any holder of Separate Notes
(and any of their respective subsidiaries or Affiliates) as if it were not
acting as the Agent and the Agent and their Affiliates may accept fees and other
consideration from the Company, any Holder of Units or any holder of Separate
Notes without having to account for the same to any such Person.
Section 7.6 Money Held In Custody.
Money held by the Agent in custody hereunder need not be
segregated from the Agent's other funds except to the extent required by law or
provided herein. The Agent shall be under no obligation to invest or pay
interest on any money received by it hereunder except as otherwise agreed in
writing with the Company.
Section 7.7 Compensation and Reimbursement.
The Company agrees:
(a) to pay all fees and expenses related to the retention of
the Collateral Agent under the Pledge Agreement;
(b) to pay all fees and expenses related to the; enforcement
by the Agent of the rights of the Holders hereunder or under the
Transaction Documents;
(c) to pay to the Agent from time to time compensation for all
services rendered by it hereunder or under the Transaction Documents as
shall be agreed in writing between the Company and the Agent;
(d) to reimburse the Agent upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Agent in
accordance with any provision of this Agreement or the Transaction
Documents (including the reasonable compensation and the reasonable
expenses and disbursements of its agents and counsel), except any such
expense, disbursement or advance as may be attributable to its
negligence, willful misconduct or bad faith; and
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(e) to indemnify the Agent and any predecessor Agent for, and
to hold it harmless against, any loss, damage, claim, liability or
expense including taxes (other than taxes based upon, measured by or
determined by the income of the Agent), incurred without gross
negligence, willful misconduct or bad faith on their part, arising out
of or in connection with the acceptance or administration of its duties
under the Transaction Documents, including the costs and expenses
(including reasonable fees and expenses of counsel) of defending
themselves against any claim or liability in connection with the
exercise or performance of any of its powers or duties under the
Transaction Documents. The Agent shall 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,
provided that any failure to give any such notice shall not affect the
obligation of the Company under this Section.
The provisions of this Section 7.7 shall survive the
termination of this Agreement or the resignation or removal of the Agent.
Section 7.8 Corporate Agent Required; Eligibility.
There shall at all times be an Agent hereunder which shall be
a corporation organized and doing business under the laws of the United States
of America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having (or being a member of a bank
holding company having) a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by Federal or state authority and having a
Corporate Trust Office in the Borough of Manhattan, The City of New York, if
there be such a corporation, qualified and eligible under this Article and
willing to act on reasonable terms. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Agent shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.
Section 7.9 Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Agent and no appointment
of a successor Agent pursuant to this Article shall become effective
until the acceptance of appointment by the successor Agent in
accordance with the applicable requirements of Section 7.10.
(b) The Agent may resign at any time by giving written notice
thereof to the Company 60 days prior to the effective date of such
resignation. If the instrument of acceptance by a successor Agent
required by Section 7.10 shall not have been delivered to the Agent
within 30 days after the giving of such notice of resignation, the
resigning Agent may petition any court of competent jurisdiction at the
expense of the Company for the appointment of a successor Agent.
(c) The Agent may be removed at any time by Act of the Holders
of a majority in number of the Outstanding Units delivered to the Agent
and the Company.
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(d) If at any time:
(i) the Agent fails to comply with Section 310(b) of
the TIA, as if the Agent were an Trustee under an indenture
qualified under the TIA, after written request therefor by the
Company or by any Holder who has been a bona fide Holder of a
Unit for at least six months; or
(ii) the Agent shall cease to be eligible under
Section 7.8 and shall fail to resign after written request
therefor by the Company or by any such Holder; or
(iii) the Agent shall become incapable of acting or
shall be adjudged a bankrupt or insolvent or a receiver of the
Agent or of its property shall be appointed or any public
officer shall take charge or control of the Agent or of its
property or affairs for the purpose of rehabilitation,
conservation or liquidation;
then, in any such case, (x) the Company by a Board Resolution may
remove the Agent, or (y) any Holder who has been a bona fide Holder of
a Unit for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for
the removal of the Agent and the appointment of a successor Agent.
(e) If the Agent shall resign, be removed or become incapable
of acting, or if a vacancy shall occur in the office of Agent for any
cause, the Company, by a Board Resolution, shall promptly appoint a
successor Agent and shall comply with the applicable requirements of
Section 7.10. If no successor Agent shall have been so appointed by the
Company and accepted appointment in the manner required by Section
7.10, any Holder who has been a bona fide Holder of a Unit for at least
six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a
successor Agent.
(f) The Company shall give, or shall cause such successor
Agent to give, notice of each resignation and each removal of the Agent
and each appointment of a successor Agent by mailing written notice of
such event by first-class mail, postage prepaid, to all Holders as
their names and addresses appear in the applicable Register. Each
notice shall include the name of the successor Agent and the address of
its Corporate Trust Office.
Section 7.10 Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Agent,
every such successor Agent so appointed shall execute, acknowledge and
deliver to the Company and to the retiring Agent an instrument
accepting such appointment, and thereupon the resignation or removal of
the retiring Agent shall become effective and such successor Agent,
without any further act, deed or conveyance, shall become vested with
all the rights, powers, agencies and duties of the retiring Agent; but,
on the request of the Company or the successor Agent, such retiring
Agent shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Agent all the rights, powers
and trusts of the retiring Agent and duly assign, transfer and deliver
to such successor Agent all property and money held by such retiring
Agent hereunder.
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(b) Upon request of any such successor Agent, the Company
shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Agent all such rights,
powers and agencies referred to in paragraph (a) of this Section.
(c) No successor Agent shall accept its appointment unless at
the time of such acceptance such successor Agent shall be qualified and
eligible under this Article.
Section 7.11 Merger, Conversion, Consolidation or Succession
to Business.
Any corporation into which the Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Agent shall be a
party, or any corporation succeeding to all or substantially all the corporate
trust business of the Agent, shall be the successor of the Agent hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Certificates shall have been
authenticated and executed on behalf of the Holders, but not delivered, by the
Agent then in office, any successor by merger, conversion or consolidation to
such Agent shall adopt such authentication and execution and deliver the
Certificates so authenticated and executed with the same effect as if such
successor Agent had itself authenticated and executed such Units.
Section 7.12 Preservation of Information; Communications to
Holders.
(a) The Agent shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders received by
the Agent in its capacity as Registrar.
(b) If three or more Holders (herein referred to as
"Applicants") apply in writing to the Agent, and furnish to the Agent
reasonable proof that each such Applicant has owned a Unit for a period
of at least six months preceding the date of such application, and such
application states that the Applicants desire to communicate with other
Holders with respect to their rights under this Agreement or under the
Units and is accompanied by a copy of the form of proxy or other
communication which such applicants propose to transmit, then the Agent
shall mail to all the Holders copies of the form of proxy or other
communication which is specified in such request, with reasonable
promptness after a tender to the Agent of the materials to be mailed
and of payment, or provision, in the absence of bad faith, satisfactory
to the Agent for the payment, of the reasonable expenses of such
mailing.
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Section 7.13 Failure to Act.
In the event of any dispute between or conflicting claims by
or among the parties hereto or any other Person, the Agent shall be entitled,
after prompt notice to the Company and the Holders of Units, at its sole option,
to refuse to comply with any and all such claims, demands or instructions so
long as such dispute or conflict shall continue, and the Agent shall not be or
become liable in any way to any of the parties hereto for its failure or refusal
to comply with such conflicting claims, demands or instructions. The 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, reasonably satisfactory to the Agent, or (ii) the Agent
shall have received security or an indemnity reasonably satisfactory to the
Agent sufficient to save the Agent harmless from and against any and all loss,
liability or reasonable out-of-pocket expense which the Agent may incur by
reason of its acting without bad faith, willful misconduct or gross negligence.
The Agent may in addition elect to commence an interpleader action or seek other
judicial relief or orders as the Agent may deem necessary. Notwithstanding
anything contained herein to the contrary, the Agent shall not be required to
take any action that is in its opinion contrary to law or to the terms of any
Transaction Document, or which would in its opinion subject it or any of its
officers, employees or directors to liability.
Section 7.14 No Obligations of Agent.
Except to the extent otherwise provided in this Agreement, the
Agent assumes no obligation and shall not be subject to any liability under this
Agreement, the Pledge Agreement or any Purchase Contract in respect of the
obligations of the Holder of any Unit thereunder. The Company agrees, and each
Holder of a Certificate, by such Holder's acceptance thereof, shall be deemed to
have agreed, that the Agent's execution of the Certificates on behalf of the
Holders shall be solely as agent and attorney-in-fact for the Holders, and that
the Agent shall have no obligation to perform such Purchase Contracts on behalf
of the Holders, except to the extent expressly provided in Article V.
Section 7.15 Tax Compliance.
(a) The Agent, on its own behalf and on behalf of the Company,
will comply with all applicable certification, information reporting
and withholding (including "backup" withholding) requirements imposed
on it as a paying agent by applicable tax laws, regulations or
administrative practice with respect to any payments made with respect
to the Units. Such compliance shall include, without limitation, the
preparation and timely filing of required returns and the timely
payment of all amounts required to be withheld to the appropriate
taxing authority or its designated agent.
(b) The Agent shall comply with any reasonable written
direction timely received from the Company with respect to the
application of such requirements to particular payments or Holders or
in other particular circumstances, and may for purposes of this
Agreement rely on any such direction in accordance with the provisions
of Section 7.1(a)(2).
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(c) The Agent shall maintain all appropriate records
documenting compliance with such requirements, and shall make such
records available, on written request, to the Company or its authorized
representative within a reasonable period of time after receipt of such
request.
ARTICLE 8
SUPPLEMENTAL AGREEMENTS
Section 8.1 Supplemental Agreements Without Consent of
Holders.
Without the consent of any Holders, the Company and the Agent,
at any time and from time to time, may enter into one or more agreements
supplemental hereto, in form satisfactory to the Company and the Agent, for any
of the following purposes:
(a) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of
the Company herein and in the Certificates; or
(b) to add to the covenants of the Company for the benefit of
the Holders, or to surrender any right or power herein conferred upon
the Company; or
(c) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(d) to make provision with respect to the rights of Holders
pursuant to the requirements of Section 5.6(b) or 5.10; or
(e) to cure any ambiguity, to correct or supplement any
provisions herein which may be inconsistent with any other provisions
herein, or to make any other provisions with respect to such matters or
questions arising under this Agreement, provided such action shall not
adversely affect the interests of the Holders.
Section 8.2 Supplemental Agreements With Consent of Holders.
(a) With the consent of the Holders of not less than a
majority of the outstanding Purchase Contracts voting together as one
class, by Act of said Holders delivered to the Company and the Agent,
the Company, when authorized by a Board Resolution, and the Agent may
enter into an agreement or agreements supplemental hereto, in form
satisfactory to the Company and the Agent, for the purpose of modifying
in any manner the terms of the Purchase Contracts, or the provisions of
this Agreement or the rights of the Holders in respect of the Units;
provided, that, except as contemplated herein, no such supplemental
agreement shall, without the consent of the Holder of each Outstanding
Unit affected thereby:
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(i) change any Payment Date;
(ii) change the amount or the type of Collateral
required to be Pledged to secure a Holder's obligations under
the Purchase Contract, impair the right of the Holder of any
Purchase Contract to receive distributions on the related
Collateral (except for the rights of Holders of Normal Units
to substitute the Treasury Securities for the Pledged Notes,
Pledged Treasury Consideration or Pledged Applicable Ownership
Interest in the Treasury Portfolio, or the rights of holders
of Stripped Units to substitute Notes or Applicable Ownership
Interest in the Treasury Portfolio for the Pledged Treasury
Securities) or otherwise adversely affect the Holder's
beneficial rights in or to such Collateral or materially
adversely alter the rights in or to such Collateral subject to
the Pledge Agreement;
(iii) impair the right to institute suit for the
enforcement of any Purchase Contract;
(iv) reduce the number of shares of Common Stock to
be purchased pursuant to any Purchase Contract, increase the
price to purchase shares of Common Stock upon settlement of
any Purchase Contract, change the Stock Purchase Date or
otherwise materially adversely affect the Holder's rights
under any Purchase Contract;
(v) reduce the percentage of the outstanding Purchase
Contracts the consent of whose Holders is required for any
such supplemental agreement; or
(vi) change the place or currency of payment for any
amounts payable in respect of the Units, increase any amounts
payable by Holders in respect of the Units or decrease any
other amounts receivable by Holders in respect of the Units,
provided that, if any amendment or proposal referred to above would
adversely affect only the Normal Units or the Stripped Units, then only
the affected class of Holder as of the record date for the Holders
entitled to vote thereon will be entitled to vote on such amendment or
proposal, and such amendment or proposal shall not be effective except
with the consent of Holders of not less than a majority or 100% of such
class, as the case may be.
(b) It shall not be necessary for any Act of Holders under
this Section to approve the particular form of any proposed
supplemental agreement, but it shall be sufficient if such Act shall
approve the substance thereof.
Section 8.3 Execution of Supplemental Agreements.
In executing, or accepting the additional agencies created by,
any supplemental agreement permitted by this Article or the modifications
thereby of the agencies created by this Agreement, the Agent shall be provided
and (subject to Section 7.1) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental agreement is
authorized or permitted by this Agreement. The Agent may, but shall not be
obligated to, enter into any such supplemental agreement which affects the
Agent's own rights, duties or immunities under this Agreement or otherwise.
65
Section 8.4 Effect of Supplemental Agreements.
Upon the execution of any supplemental agreement under this
Article, this Agreement shall be modified in accordance therewith, and such
supplemental agreement shall form a part of this Agreement for all purposes; and
every Holder of Certificates theretofore or thereafter authenticated, executed
on behalf of the Holders and delivered hereunder shall be bound thereby.
Section 8.5 Reference to Supplemental Agreements.
Certificates authenticated, executed on behalf of the Holders
and delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Agent, bear a notation in form
approved by the Agent as to any matter provided for in such supplemental
agreement. If the Company shall so determine, new Certificates so modified as to
conform, in the opinion of the Agent and the Company, to any such supplemental
agreement may be prepared and executed by the Company and authenticated,
executed on behalf of the Holders and delivered by the Agent in exchange for
outstanding Certificates.
ARTICLE 9
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
Section 9.1 Covenant Not to Merge, Consolidate, Sell or Convey
Assets Except Under Certain Conditions.
The Company covenants that it shall not consolidate with or
merge into any other entity or convey or transfer its properties and assets
substantially as an entirety to any Person unless:
(i) the Person formed by such consolidation or into
which the Company is merged or the Person which acquires by
conveyance or transfer the properties and assets of the
Company substantially as an entirety shall be a corporation,
limited liability company or trust (if not the Company)
organized and validly existing under the laws of the United
States of America or any State thereof or the District of
Columbia, and shall expressly assume all the obligations of
the Company under the Purchase Contracts, this Agreement, the
Remarketing Agreement and the Pledge Agreement by one or more
supplemental agreements in form reasonably satisfactory to the
Agent and the Collateral Agent, executed and delivered to the
Agent and the Collateral Agent by such successor entity, the
due and punctual performance of every obligation and covenant
of this Agreement on the part of the Company to be performed
or observed;
(ii) immediately after giving effect to such
transaction, no default and no event which, after notice or
lapse of time, or both, would become a default under this
Agreement, the Purchase Contracts, the Pledge Agreement or the
Remarketing Agreement, shall have occurred and be continuing;
and
66
(iii) the Company has delivered to the to the Agent
and the Collateral Agent an Officers' Certificate and an
Opinion of Counsel each stating that such consolidation,
merger, conveyance or transfer and such supplemental agreement
comply with this Article and that all conditions precedent
herein provided for relating to such transaction have been
complied with.
In the event the Company is not the successor of any such
consolidation, merger or sale of the assets substantially as an entirety and the
successor is a limited liability company or trust, then the Company or such
trust or limited liability company, in connection with such transaction, shall
create a corporation to act as a co-obligor of the Purchase Contracts, Notes and
Units.
Section 9.2 Rights and Duties of Successor Corporation.
Upon any consolidation or merger, or any conveyance or
transfer of the properties and assets of the Company substantially as an
entirety in accordance with Section 9.1, the successor Person formed by such
consolidation or into which the Company is merged or to which such conveyance or
transfer is made shall succeed to, and be substituted for, and may exercise
every right and power of, the Company under this Agreement, the Pledge Agreement
and the Purchase Contracts with the same effect as if such successor Person had
been named as the Company herein, and thereafter the predecessor Person shall be
relieved of all obligations and covenants under this Agreement, the Pledge
Agreement and the Purchase Contracts. In the event of any such conveyance or
transfer, the Company as the predecessor Person may thereupon or at any time
thereafter be dissolved, wound up, or liquidated.
ARTICLE 10
COVENANTS
Section 10.1 Performance Under Purchase Contracts.
The Company covenants and agrees for the benefit of the
Holders from time to time of the Units that it will duly and punctually perform
its obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.
Section 10.2 Maintenance of Office or Agency.
(a) The Company will maintain in the Borough of Manhattan, The
City of New York an office or agency where Certificates may be
presented or surrendered for acquisition of shares of Common Stock upon
settlement of the Purchase Contracts on any Settlement Date and for
transfer of Collateral upon occurrence of a Termination Event, where
Certificates may be surrendered for registration of transfer or
exchange, for a Collateral Substitution or reestablishment of Normal
Units and where notices and demands to or upon the Company in respect
of the Units and this Agreement may be served. The Company will give
prompt written notice to the Agent of the location, and any change in
the location, of such office or agency. If at any time the Company
shall fail to maintain any such required office or agency or shall fail
to furnish the Agent with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate
Trust Office, and the Company hereby appoints the Agent as its agent to
receive all such presentations, surrenders, notices and demands.
67
(b) The Company may also from time to time designate one or
more other offices or agencies where Certificates may be presented or
surrendered for any or all such purposes and may from time to time
rescind such designations; provided, that no such designation or
rescission shall in any manner relieve the Company of its obligation to
maintain an office or agency in the Borough of Manhattan, The City of
New York for such purposes. The Company will give prompt written notice
to the Agent of any such designation or rescission and of any change in
the location of any such other office or agency. The Company hereby
designates as the place of payment for the Units the Corporate Trust
Office and appoints the Agent at its Corporate Trust Office as paying
agent in such city.
Section 10.3 Company to Reserve Common Stock.
The Company shall at all times prior to the Stock Purchase
Date reserve and keep available, free from preemptive rights, out of its
authorized but unissued Common Stock the full number of shares of Common Stock
issuable against tender of payment in respect of all Purchase Contracts
constituting a part of the Units evidenced by Outstanding Certificates without
giving effect to any changes in the number of such shares due to Sections 5.6
and 5.7.
Section 10.4 Covenants as to Common Stock.
The Company covenants that all shares of Common Stock which
may be issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Units will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.
Section 10.5 Statements of Officer of the Company as to
Default.
The Company will deliver to the Agent, within 120 days after
the end of each fiscal year of the Company ending after the date hereof, an
Officer's Certificate, stating whether or not to the best knowledge of the
signer thereof the Company is in default in the performance and observance of
any of the terms, provisions and conditions hereof, and if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which such Officer may have knowledge.
68
Section 10.6 Tax Treatment.
The Company and the Holders by purchasing a Normal Unit,
covenant and agree, for all tax purposes, to (i) treat a Holder's acquisition of
the Normal Units as the acquisition of the Note and Purchase Contract
constituting the Normal Unit, (ii) treat the Holder's acquisition of the
Stripped Units as the acquisition of the Treasury Security and the Purchase
Contract constituting the Stripped Unit and (iii) treat each Holder as the owner
of the related Notes, Applicable Ownership Interest in the Treasury Portfolio or
Treasury Securities, as the case may be.
[SIGNATURE PAGES FOLLOW]
69
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
TOYS "R" US, INC.
By: /s/ Xxxxx Xxxxxxxxx
------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Executive Vice President -
Chief Executive Officer
THE BANK OF NEW YORK
as Purchase Contract Agent
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Assistant Vice President
70
EXHIBIT A
FORM OF NORMAL UNITS CERTIFICATE
(Form of Face of Normal Units Certificate)
[For inclusion in Global CertificateS only -- THIS CERTIFICATE
IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE CONTRACT AGREEMENT
(AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE NAME OF THE CLEARING AGENCY OR
A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR
A CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE IN WHOLE OR IN
PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH CLEARING
AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE PURCHASE CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized
representative of The Depository Trust Company (55 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 10041-0099) to the Company or its agent for registration of
transfer, exchange or payment, and any Certificate issued is registered in the
name of Cede & Co., or such other name as requested by an authorized
representative of The Depository Trust Company, and any payment hereon is made
to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY A PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an
interest herein.]
No. ______________ CUSIP No. 000000000
Number of Normal Units___
Normal Units
This Normal Units Certificate certifies that [For inclusion in
Global Certificates only -- Cede & Co.] is the registered Holder of the number
of Normal Units set forth above [For inclusion in Global Certificates only - or
such other number of Normal Units reflected in the Schedule of Increases or
Decreases in Global Certificates attached hereto]. Each Normal Unit represents
(i) any one of (a) a beneficial ownership by the Holder of one Senior Note due
2007 (the "Note") of Toys "R" Us, Inc., a Delaware corporation (the "Company"),
having a principal amount of $50, subject to the Pledge of such Note by such
Holder pursuant to the Pledge Agreement, or (b) if the Note has been remarketed
by the Remarketing Agent (or if the Holder has elected not to have the Note
remarketed), the Applicable Ownership Interest in the Treasury Portfolio by such
Holder pursuant to the Pledge Agreement or (c) if a Tax Event Redemption has
occurred, the Applicable Ownership Interest in the Treasury Portfolio subject to
the Pledge pursuant to the Pledge Agreement, and (ii) the rights and obligations
of the Holder under one Purchase Contract of the Company. All capitalized terms
used but not defined herein which are defined in the Purchase Contract Agreement
have the meaning set forth therein.
Pursuant to the Pledge Agreement, the Notes or Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, constituting
part of each Normal Units evidenced hereby has been, or will be, as the case may
be, pledged to the Collateral Agent, for the benefit of the Company, to secure
the obligations of the Holder under the Purchase Contract comprising a part of
such Normal Units.
A-1
The Pledge Agreement provides that all payments of principal
on the Pledged Notes or, if applicable, the Pledged Applicable Ownership
Interest (as specified in clause (A) of the definition of Applicable Ownership
Interest) in the Treasury Portfolio, as the case may be, or interest payments on
the Pledged Notes (as defined in the Pledge Agreement) or on the Applicable
Ownership Interest (as specified in clause (B) of the definition of such term)
in the Treasury Portfolio, as the case may be, constituting part of the Normal
Units received by the Collateral Agent shall be paid by the Collateral Agent by
wire transfer in same day funds (i) in the case of (A) interest payments with
respect to Pledged Notes or Pledged Applicable Ownership Interest (as specified
in clause (B) of the definition of Applicable Ownership Interest) in the
Treasury Portfolio, as the case may be, and (B) any payments of principal with
respect to any Notes or the Applicable Ownership Interest (as specified in
clause (A) of the definition of such terms) in the Treasury Portfolio, as the
case may be, that have been released from the Pledge pursuant to the Pledge
Agreement, to the Agent to the account designated by the Agent, no later than
2:00 p.m. (New York City time) on the Business Day such payment is received by
the Collateral Agent (provided that in the event such payment is received by the
Collateral Agent on a day that is not a Business Day or after 12:30 p.m. (New
York City time) on a Business Day, then such payment shall be made no later than
10:30 a.m. (New York City time) on the next succeeding Business Day) and (ii) in
the case of payments of principal on any Pledged Notes or the Pledged Applicable
Ownership Interest (as specified in clause (A) of the definition of Applicable
Ownership Interest) in the Treasury Portfolio, as the case may be, that has not
been released from the Pledge pursuant to the Pledge Agreement to the Company on
the Stock Purchase Date (as defined herein) in accordance with the terms of the
Pledge Agreement, in full satisfaction of the respective obligations of the
Holders of the Normal Units of which such Pledged Notes or Pledged Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, are a part
under the Purchase Contracts forming a part of such Normal Units. Interest on
any Notes or distributions on the Applicable Ownership Interest (as specified in
clause (B) of the definition of such term) of the Treasury Portfolio, as the
case may be, forming part of a Normal Unit evidenced hereby which are payable
quarterly in arrears on February 16, May 16, August 16, and November 16, each
year, commencing on August 16, 2002 (each a "Payment Date"), shall, subject to
receipt thereof from the Collateral Agent, be paid to the Person in whose name
this Normal Units Certificate (or a Predecessor Normal Units Certificate) is
registered at the close of business on the Record Date for such Payment Date.
Each Purchase Contract evidenced hereby obligates the Holder
of this Normal Units Certificate to purchase, and the Company to sell, on August
16, 2005 (the "Stock Purchase Date"), at a price equal to $50 (the "Stated
Amount"), a number of newly issued shares of common stock, $.10 par value per
share ("Common Stock"), of the Company, equal to the Settlement Rate, then in
effect, unless on or prior to the Stock Purchase Date there shall have occurred
a Termination Event, Cash Settlement, Early Settlement or Merger Early
Settlement with respect to the Normal Units of which such Purchase Contract is a
part, all as provided in the Purchase Contract Agreement and more fully
described on the reverse hereof. The Purchase Price for the shares of Common
Stock purchased pursuant to each Purchase Contract evidenced hereby, if not paid
earlier, shall be paid on the Stock Purchase Date by application of payments
received in respect of the Pledged Notes or Pledged Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, pledged to secure the
obligations of the Holder under such Purchase Contract in accordance with the
terms of the Pledge Agreement.
A-2
Payments on the Notes or Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, will be payable at the office of the
Agent in The City of New York or, at the option of the Company, by check mailed
to the address of the Person entitled thereto as such address appears on the
Normal Units Register or by wire transfer to an account specified by such Person
at least five Business Days prior to the applicable Payment Date.
Reference is hereby made to the further provisions set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
authenticated by the Agent by manual signature, this Normal Units Certificate
shall not be entitled to any benefit under the Pledge Agreement or the Purchase
Contract Agreement or be valid or obligatory for any purpose.
A-3
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
TOYS "R" US, INC.
By:
------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations of
such Holder under the Purchase Contracts
evidenced hereby)
By: THE BANK OF NEW YORK, not individually
but solely as Attorney-in-Fact of such
Holder
By:
----------------------------------
Authorized Signatory
A-4
AGENT'S CERTIFICATE OF AUTHENTICATION This is one of the
Normal Units Certificates referred to in the within mentioned Purchase Contract
Agreement.
THE BANK OF NEW YORK,
as Purchase Contract Agent
Dated: By:
----------------------- ---------------------------
Authorized Signatory
A-5
(Form of Reverse of Normal Units Certificate)
Each Purchase Contract evidenced hereby is governed by the
Purchase Contract Agreement, dated as of May 28, 2002 (as may be supplemented
from time to time, the "Purchase Contract Agreement"), between the Company and
The Bank of New York, as Purchase Contract Agent (including its successors
thereunder, herein called the "Agent"), to which Purchase Contract Agreement and
supplemental agreements thereto reference is hereby made for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Agent, the Company, and the Holders and of the terms upon
which the Normal Units Certificates are, and are to be, executed and delivered.
In the case of any inconsistency between this Normal Units Certificate and the
terms of the Purchase Contract Agreement, the terms of the Purchase Contract
Agreement govern.
Each Purchase Contract evidenced hereby obligates the Holder
of this Normal Units Certificate to purchase, and the Company to sell, on the
Stock Purchase Date at a price equal to $50 (the "Purchase Price"), a number of
shares of Common Stock of the Company equal to the Settlement Rate, then in
effect, unless, on or prior to the Stock Purchase Date, there shall have
occurred a Termination Event, an Early Settlement, Merger Early Settlement or
Cash Settlement with respect to the Units of which such Purchase Contract is a
part. The "Settlement Rate" is equal to (a) if the Applicable Market Value is
greater than or equal to $21.55 (the "Threshold Appreciation Price"), 2.3202
shares of Common Stock per Purchase Contract, (b) if the Applicable Market Value
is less than the Threshold Appreciation Price but is greater than $17.65, the
number of shares of Common Stock per Purchase Contract equal to the Stated
Amount of the related Unit divided by the Applicable Market Value and (c) if the
Applicable Market Value is less than or equal to $17.65, 2.8329 shares of Common
Stock per Purchase Contract, in each case subject to adjustment as provided in
the Purchase Contract Agreement. No fractional shares of Common Stock will be
issued upon settlement of Purchase Contracts, as provided in the Purchase
Contract Agreement. The number of shares of Common Stock per Purchase Contract
will be subject to adjustment as provided by Sections 5.6 and 5.7 of the
Purchase Contract Agreement.
The "Applicable Market Value" means the average of the Closing
Price per share of Common Stock on each of the 20 consecutive Trading Days
ending on the third Trading Day immediately preceding the Stock Purchase Date.
The "Closing Price" of the Common Stock on any date of
determination means the closing sale price per share (or, if no closing price is
reported, the last reported sale price per share) of the Common Stock on the New
York Stock Exchange (the "NYSE") on such date or, if the Common Stock is not
listed for trading on the NYSE on any such date, as reported in the composite
transactions for the principal United States securities exchange on which the
Common Stock is so listed, or if the Common Stock is not so listed on a United
States national or regional securities exchange, as reported by The Nasdaq Stock
Market, or, if the Common Stock is not so reported, the last quoted bid price
for the Common Stock in the over-the-counter market as reported by the National
Quotation Bureau or similar organization, or, if such bid price is not
available, the market value of the Common Stock on such date as determined by a
nationally recognized independent investment banking firm retained for this
purpose by the Company.
A-6
A "Trading Day" means a day on which the Common Stock (A) is
not suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
Each Purchase Contract evidenced hereby may be settled prior
to the Stock Purchase Date through Cash Settlement, Early Settlement or Merger
Early Settlement, in accordance with the terms of the Purchase Contract
Agreement.
In accordance with the terms of the Purchase Contract
Agreement, the Holder of this Normal Units Certificate shall pay the Purchase
Price for the shares of Common Stock purchased pursuant to each Purchase
Contract evidenced hereby (i) by effecting a Cash Settlement, Early Settlement
or Merger Early Settlement, (ii) by application of payments received in respect
of the Pledged Applicable Ownership Interest in the Treasury Portfolio acquired
from the proceeds of a remarketing of the related Pledged Notes underlying the
Normal Units represented by this Normal Units Certificate, (iii) if the Holder
has elected not to participate in the remarketing, by application of payments
received in respect of the Opt-out Treasury Consideration deposited by such
Holder in respect of such Purchase Contract or (iv) if a Tax Event Redemption
has occurred prior to the successful remarketing of the Notes by application of
payments received in respect of the Pledged Applicable Ownership Interest in the
Treasury Portfolio by the Collateral Agent on behalf of the Holder of this
Normal Units Certificate. If, as provided in the Purchase Contract Agreement,
upon the occurrence of a Last Failed Remarketing the Collateral Agent, for the
benefit of the Company, exercises its rights as a secured creditor with respect
to the Pledged Notes related to this Normal Units Certificate, any accrued and
unpaid interest on such Pledged Notes will become payable by the Company to the
Holder of this Normal Units Certificate in the manner provided for in the
Purchase Contract Agreement and the Indenture.
The Company shall not be obligated to issue any shares of
Common Stock in respect of a Purchase Contract or deliver any certificates
therefor to the Holder unless it shall have received payment in full of the
aggregate Purchase Price for the shares of Common Stock to be purchased
thereunder in the manner herein set forth.
Under the terms of the Pledge Agreement, the Agent will be
entitled to exercise the voting and any other consensual rights pertaining to
the Pledged Notes. Upon receipt of notice of any meeting at which holders of
Notes are entitled to vote or upon the solicitation of consents, waivers or
proxies of holders of Notes, the Agent shall, as soon as practicable thereafter,
mail to the Holders of Normal Units a notice (a) containing such information as
is contained in the notice or solicitation, (b) stating that each such Holder on
the record date set by the Agent therefor (which, to the extent possible, shall
be the same date as the record date for determining the holders of Notes
entitled to vote) shall be entitled to instruct the Agent as to the exercise of
the voting rights pertaining to the Pledged Notes constituting a part of such
Holder's Normal Units and (c) stating the manner in which such instructions may
be given. Upon the written request of the Holders of Normal Units on such record
date, the Agent shall endeavor insofar as practicable to vote or cause to be
voted, in accordance with the instructions set forth in such requests, the
maximum number of Pledged Notes as to which any particular voting instructions
are received. In the absence of specific instructions from the Holder of a
Normal Unit, the Agent shall abstain from voting the Pledged Note evidenced by
such Normal Unit.
A-7
The Normal Units Certificates are issuable only in registered
form and only in denominations of a single Normal Unit and any integral multiple
thereof. The transfer of any Normal Units Certificate will be registered and
Normal Units Certificates may be exchanged as provided in the Purchase Contract
Agreement. The Normal Units Registrar may require a Holder, among other things,
to furnish appropriate endorsements and transfer documents permitted by the
Purchase Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Agent may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. The Holder of a Normal Unit may substitute
Treasury Securities for the Pledged Notes or Pledged Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, securing its obligations
under the related Purchase Contract in accordance with the terms of the Purchase
Contract Agreement and the Pledge Agreement. From and after such Collateral
Substitution, the Unit for which such Pledged Treasury Securities secures the
Holder's obligation under the Purchase Contract shall be referred to as a
"Stripped Unit" evidenced by a Stripped Units Certificate. A Holder that elects
to substitute a Treasury Security for Pledged Notes or Pledged Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, thereby
creating Stripped Units, shall be responsible for any fees or expenses payable
in connection therewith. Except as provided in the Purchase Contract Agreement,
for so long as the Purchase Contract underlying a Normal Unit remains in effect,
such Normal Unit shall not be separable into its constituent parts, and the
rights and obligations of the Holder of such Normal Units in respect of the
Pledged Note or Pledged Applicable Ownership Interest in the Treasury Portfolio,
as the case may be, and Purchase Contract constituting such Normal Unit may be
transferred and exchanged only as a Normal Unit.
A Holder of Stripped Units may reestablish Normal Units by
delivering to the Collateral Agent Notes or the Applicable Ownership Interest in
the Treasury Portfolio, as the case may be, in exchange for the release of the
Pledged Treasury Securities in accordance with the terms of the Purchase
Contract Agreement and the Pledge Agreement.
The Purchase Contracts and all obligations and rights of the
Company and the Holders thereunder, including, without limitation, the rights of
the Holders to purchase Common Stock, shall immediately and automatically
terminate, without the necessity of any notice or action by any Holder, the
Agent or the Company, if, on or prior to the Stock Purchase Date, a Termination
Event shall have occurred. Upon the occurrence of a Termination Event, the
Company shall promptly but in no event later than two Business Days thereafter
give written notice to the Agent, the Collateral Agent and to the Holders, at
their addresses as they appear in the Normal Units Register. Upon and after the
occurrence of a Termination Event, the Collateral Agent shall release the
Pledged Notes or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, from the Pledge in accordance with the provisions
of the Pledge Agreement.
A-8
Subject to and upon compliance with the provisions of the
Purchase Contract Agreement, at the option of the Holder thereof, Purchase
Contracts may be settled early ("Early Settlement") as provided in the Purchase
Contract Agreement. In order to exercise the right to effect Early Settlement
with respect to any Purchase Contracts evidenced by this Normal Units
Certificate, the Holder of this Normal Units Certificate shall deliver to the
Agent at the Corporate Trust Office an Election to Settle Early form set forth
below and any other documents requested by the Agent duly completed and
accompanied by payment in the form of immediately available funds payable to the
order of the Company in an amount (the "Early Settlement Amount") equal to the
product of (A) $50 times (B) the number of Purchase Contracts with respect to
which the Holder has elected to effect Early Settlement.
Upon Early Settlement of Purchase Contracts by a Holder of the
related Units, the Notes or Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) in the Treasury Portfolio, as the
case may be, underlying such Units shall be released from the Pledge as provided
in the Pledge Agreement and the Holder of each Purchase Contract forming part of
a Normal Unit as to which Early Settlement is effected equal to 2.3202 shares of
Common Stock per Purchase Contract (the "Early Settlement Rate"). The Early
Settlement Rate shall be adjusted in the same manner and at the same time as the
Settlement Rate is adjusted as provided in the Purchase Contract Agreement.
Upon registration of transfer of this Normal Units
Certificate, the transferee shall be bound (without the necessity of any other
action on the part of such transferee, except as may be required by the Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Normal Units Certificate. The Company covenants and agrees,
and the Holder, by its acceptance hereof, likewise covenants and agrees, to be
bound by the provisions of this paragraph.
The Holder of this Normal Units Certificate, by its acceptance
hereof, authorizes the Agent to enter into and perform the related Purchase
Contracts forming part of the Normal Units evidenced hereby on its behalf as its
attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Purchase Contracts by the Company or its trustee in the event
that the Company becomes the subject of a case under the Bankruptcy Code, agrees
to be bound by the terms and provisions thereof, covenants and agrees to perform
such Holder's obligations under such Purchase Contracts, consents to the
provisions of the Purchase Contract Agreement, authorizes the Agent to enter
into and perform the Pledge Agreement on such Holder's behalf as
attorney-in-fact, and consents to the Pledge of the Notes or the Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, underlying
this Normal Units Certificate pursuant to the Pledge Agreement. The Holder
further covenants and agrees, that, to the extent and in the manner provided in
the Purchase Contract Agreement and the Pledge Agreement, but subject to the
terms thereof, payments in respect of the Pledged Notes or Pledged Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, to be paid
upon settlement of such Holder's obligations to purchase Common Stock under the
Purchase Contract, shall be paid on the Stock Purchase Date by the Collateral
Agent to the Company in satisfaction of such Holder's obligations under such
Purchase Contract and such Holder shall acquire no right, title or interest in
such payments.
Each Purchase Contract evidenced hereby obligates the Holder
to agree, for U.S. tax purposes, to (i) treat an acquisition of the Normal Unit
as an acquisition of the Note and Purchase Contract constituting the Normal Unit
and (ii) treat itself as owner of the related Notes, Applicable Ownership
Interest in the Treasury Portfolio or Treasury Securities, as the case may be.
A-9
Subject to certain exceptions, the provisions of the Purchase
Contract Agreement may be amended with the consent of the Holders of a majority
of the Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by,
and construed in accordance with, the laws of the State of New York.
The Company, the Agent and its Affiliates and any agent of the
Company or the Agent may treat the Person in whose name this Normal Units
Certificate is registered as the owner of the Normal Units evidenced hereby for
the purpose of receiving quarterly payments on the Notes, or the Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, performance of
the Purchase Contracts and for all other purposes whatsoever (subject to the
Record Date provisions hereof), whether or not any payments in respect thereof
be overdue and notwithstanding any notice to the contrary, and neither the
Company, the Agent, such Affiliates nor any such agent shall be affected by
notice to the contrary.
The Purchase Contracts shall not, prior to the settlement
thereof, entitle the Holder to any of the rights of a holder of shares of Common
Stock.
A copy of the Purchase Contract Agreement is available for
inspection at the offices of the Agent.
A-10
ABBREVIATIONS
The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - Custodian
--------------------------------
(cust) (minor)
Under Uniform Gifts to Minors Act
--------------------------------
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of
survivorship and not as tenants in common
Additional abbreviations may also be used though not in the above list.
A-11
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Normal Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing ____________________________ attorney to
transfer said Normal Units Certificates on the books of Toys "R" Us, Inc. with
full power of substitution in the premises.
Dated: Signature:
----------------------- --------------------------
NOTICE: The signature to this assignment must correspond with
the name as it appears upon the face of the within Normal Units Certificates in
every particular, without alteration or enlargement or any change whatsoever.
Signature Guarantee:
----------------------------------------------------
A-12
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares
of Common Stock deliverable upon settlement on or after the Stock Purchase Date
of the Purchase Contracts underlying the number of Normal Units evidenced by
this Normal Units Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional shares, to the undersigned
at the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated: Signature:
------------------------ ---------------------------
Signature Guarantee:
------------------
(if assigned to another person)
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
If shares are to be registered in REGISTERED HOLDER
the name of and delivered to a
Person other than the Holder, please Please print name and address of
(i) print such Person's name and Registered Holder:
address and (ii) provide a guarantee
of your signature:
---------------------------------- ----------------------------------
Name Name
---------------------------------- ----------------------------------
Address Address
Social Security or other Taxpayer
Identification Number, if any
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
A-13
ELECTION TO SETTLE EARLY
The undersigned Holder of this Normal Units Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
Section 5.9 of the terms of the Purchase Contract Agreement with respect to the
Purchase Contracts underlying the number of Normal Units evidenced by this
Normal Units Certificate specified below. The option to effect Early Settlement
may be exercised only with respect to Purchase Contracts underlying Normal Units
with an aggregate Stated Amount equal to $50 or an integral multiple thereof,
provided, however, that such option may only be exercised with respect to
Purchase Contracts underlying Normal Units secured by Pledged Applicable
Ownership Interest in the Treasury Portfolio with an aggregate Stated Amount
equal to $1,000 or an integral multiple thereof. The undersigned Holder directs
that a certificate for shares of Common Stock deliverable upon such Early
Settlement be registered in the name of, and delivered, together with a check in
payment for any fractional shares and any Normal Units Certificate representing
any Normal Units evidenced hereby as to which Early Settlement of the related
Purchase Contracts is not effected, to the undersigned at the address indicated
below unless a different name and address have been indicated below. Pledged
Notes or Pledged Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, deliverable upon such Early Settlement will be transferred in
accordance with the transfer instructions set forth below. If shares are to be
registered in the name of a Person other than the undersigned, the undersigned
will pay any transfer tax payable incident thereto.
Dated: Signature:
------------------------ ---------------------------
Signature Guarantee:
------------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Number of Units evidenced hereby as to which Early Settlement
of the related Purchase Contracts is being elected:
If shares of Common Stock are to be REGISTERED HOLDER
registered in the name of and
delivered to and Pledged Notes or Please print name and address of
Pledged Applicable Ownership Registered Holder:
Interest in the Treasury Portfolio,
as the case may be, are to be
transferred to a Person other than
the Holder, please print such
Person's name and address:
---------------------------------- ----------------------------------
Name Name
---------------------------------- ----------------------------------
Address Address
A-14
Social Security or other Taxpayer
Identification Number, if any
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Transfer instructions for Pledged Notes or Pledged Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, transferable
upon Early Settlement or a Termination Event:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
A-15
(TO BE ATTACHED TO GLOBAL CERTIFICATES)
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global
Certificate have been made:
Stated Amount of
Amount of decrease Amount of increase the Global
in Stated Amount in Stated Amount of Certificate
of the Global the Global Following Such Signature of Authorized
Date Certificate Certificate decrease or increase Signatory
A-16
EXHIBIT B
FORM OF STRIPPED UNITS CERTIFICATE
(Form of Face of Stripped Units Certificate)
[FOR INCLUSION IN GLOBAL CERTIFICATES ONLY -- THIS CERTIFICATE
IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE CONTRACT AGREEMENT
(AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE NAME OF A CLEARING AGENCY OR A
NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE IN WHOLE OR IN PART
MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH CLEARING AGENCY OR
A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE
CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized
representative of The Depository Trust Company (55 Xxxxx Xxxxxx, 00xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 10041-0099) to the Company or its agent for registration of
transfer, exchange or payment, and any Certificate issued is registered in the
name of Cede & Co., or such other name as requested by an authorized
representative of The Depository Trust Company, and any payment hereon is made
to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY A PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an
interest herein.]
No. _____ CUSIP No. 000000000
Number of Stripped Units ___________
Stripped Units
This Stripped Units Certificate certifies that [For inclusion
in Global Certificates only -- Cede & Co.] is the registered Holder of the
number of Stripped Units set forth above [For inclusion in Global Certificates
only - or such other number of Stripped Units reflected in the Schedule of
Increases or Decreases in Global Certificate attached hereto]. Each Stripped
Unit represents (i) a 1/20 or 5.0% undivided beneficial ownership interest in a
Treasury Security, subject to the Pledge of such interest in such Treasury
Security by such Holder pursuant to the Pledge Agreement, and (ii) the rights
and obligations of the Holder under one Purchase Contract with Toys "R" Us,
Inc., a Delaware corporation (the "Company"). All capitalized terms used but not
defined herein which are defined in the Purchase Contract Agreement have the
meaning set forth therein.
Pursuant to the Pledge Agreement, the Treasury Security
constituting part of each Stripped Units evidenced hereby has been pledged to
the Collateral Agent, for the benefit of the Company, to secure the obligations
of the Holder under the Purchase Contract comprising a part of such Stripped
Units.
Each Purchase Contract evidenced hereby obligates the Holder
of this Stripped Units Certificate to purchase, and the Company to sell, on
August 16, 2005 (the "Stock Purchase Date"), at a price equal to $50 (the
"Stated Amount"), a number of shares of common stock, $.10 par value per share
("Common Stock"), of the Company, equal to the Settlement Rate, then in effect,
unless on or prior to the Stock Purchase Date there shall have occurred a
Termination Event, Cash Settlement, Early Settlement or Merger Early Settlement
with respect to the Stripped Units of which such Purchase Contract is a part,
all as provided in the Purchase Contract Agreement and more fully described on
the reverse hereof. The Purchase Price (as defined herein) for the shares of
Common Stock purchased pursuant to each Purchase Contract evidenced hereby, if
not paid earlier, shall be paid on the Stock Purchase Date by application of
payments received in respect of the Pledged Treasury Securities pledged to
secure the obligations under such Purchase Contract in accordance with the terms
of the Pledge Agreement.
B-1
Payments on the Treasury Securities will be payable at the
office of the Agent in The City of New York or, at the option of the Company, by
check mailed to the address of the Person entitled thereto as such address
appears on the Stripped Units Register or by wire transfer to an account
specified by such Person at least five business Days prior to the applicable
Payment Date.
Reference is hereby made to the further provisions set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Agent by manual signature, this Stripped Units Certificate shall
not be entitled to any benefit under the Pledge Agreement or the Purchase
Contract Agreement or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
TOYS "R" US, INC.
By:
---------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations of
such Holder under the Purchase Contracts)
By: THE BANK OF NEW YORK, not individually
but solely as Attorney-in-Fact of such
Holder
By:
---------------------------------------
Authorized Signatory
B-2
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Stripped Units referred to in the
within-mentioned Purchase Contract Agreement.
THE BANK OF NEW YORK,
as Purchase Contract Agent
Dated: By:
----------------------- ---------------------------
Authorized Signatory
B-3
(Reverse of Stripped Units Certificate)
Each Purchase Contract evidenced hereby is governed by a
Purchase Contract Agreement, dated as of May 28, 2002 (as may be supplemented
from time to time, the "Purchase Contract Agreement"), between the Company and
The Bank of New York, as Purchase Contract Agent (including its successors
thereunder, herein called the "Agent"), to which the Purchase Contract Agreement
and supplemental agreements thereto reference is hereby made for a description
of the respective rights, limitations of rights, obligations, duties and
immunities thereunder of the Agent, the Company and the Holders and of the terms
upon which the Stripped Units Certificates are, and are to be, executed and
delivered. In the case of any inconsistency between this Stripped Units
Certificate and the terms of the Purchase Contract Agreement, the terms of the
Purchase Contract Agreement govern.
Each Purchase Contract evidenced hereby obligates the Holder
of this Stripped Units Certificate to purchase, and the Company to sell, on the
Stock Purchase Date at a price equal to $50 (the "Purchase Price"), a number of
shares of Common Stock of the Company equal to the Settlement Rate, then in
effect, unless, on or prior to the Stock Purchase Date, there shall have
occurred a Termination Event, an Early Settlement, Merger Early Settlement or
Cash Settlement with respect to the Units of which such Purchase Contract is a
part. The "Settlement Rate" is equal to (a) if the Applicable Market Value (as
defined below) is greater than or equal to $21.55 (the "Threshold Appreciation
Price"), 2.3202 shares of Common Stock per Purchase Contract, (b) if the
Applicable Market Value is less than the Threshold Appreciation Price but is
greater than $17.65, the number of shares of Common Stock per Purchase Contract
equal to the Stated Amount divided by the Applicable Market Value and (c) if the
Applicable Market Value is less than or equal to $17.65, 2.8329 shares of Common
Stock per Purchase Contract, in each case subject to adjustment as provided in
the Purchase Contract Agreement. No fractional shares of Common Stock will be
issued upon settlement of Purchase Contracts, as provided in the Purchase
Contract Agreement. The number of shares of Common Stock per Purchase Contract
will be subject to adjustment as provided by Sections 5.6 and 5.7 of the
Purchase Contract Agreement.
The "Applicable Market Value" means the average of the Closing
Price per share of Common Stock on each of the 20 consecutive Trading Days
ending on the third Trading Day immediately preceding the Stock Purchase Date.
The "Closing Price" of the Common Stock on any date of
determination means the closing sale price (or, if no closing price is reported,
the last reported sale price) of the Common Stock on the New York Stock Exchange
(the "NYSE") on such date or, if the Common Stock is not listed for trading on
the NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States national or
regional securities exchange, as reported by The Nasdaq Stock Market, or, if the
Common Stock is not so reported, the last quoted bid price for the Common Stock
in the over-the-counter market as reported by the National Quotation Bureau or
similar organization, or, if such bid price is not available, the market value
of the Common Stock on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the Company.
B-4
A "Trading Day" means a day on which the Common Stock (A) is
not suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
Each Purchase Contract evidenced hereby may be settled prior
to the Stock Purchase Date through Early Settlement, Merger Early Settlement or
Cash Settlement, in accordance with the terms of the Purchase Contract
Agreement.
In accordance with the terms of the Purchase Contract
Agreement, the Holder of this Stripped Units Certificate shall pay the Purchase
Price for the shares of Common Stock purchased pursuant to each Purchase
Contract evidenced hereby (i) by effecting an Early Settlement, Merger Early
Settlement or Cash Settlement or (ii) by application of payments received in
respect of the Pledged Treasury Securities underlying the Stripped Units
represented by this Stripped Units Certificate.
The Company shall not be obligated to issue any shares of
Common Stock in respect of a Purchase Contract or deliver any certificates
therefor to the Holder unless it shall have received payment in full of the
aggregate Purchase Price for the shares of Common Stock to be purchased
thereunder in the manner herein set forth.
The Stripped Units Certificates are issuable only in
registered form and only in denominations of a single Stripped Unit and any
integral multiple thereof. The transfer of any Stripped Units Certificate will
be registered and Stripped Units Certificates may be exchanged as provided in
the Purchase Contract Agreement. The Stripped Units Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents permitted by the Purchase Contract Agreement. No service charge shall
be required for any such registration of transfer or exchange, but the Company
and the Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. The Holder of a Stripped
Units may substitute for the Pledged Treasury Securities securing its
obligations under the related Purchase Contract Notes or Applicable Ownership
Interest in the Treasury Portfolio in accordance with the terms of the Purchase
Contract Agreement and the Pledge Agreement. From and after such substitution,
the Units for which such Pledged Notes or Pledged Applicable Ownership Interest
in the Treasury Portfolio secures the Holder's obligation under the Purchase
Contract shall be referred to as a "Normal Units" evidenced by a Normal Units
Certificate. A Holder that elects to substitute Notes or Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, for Pledged Treasury
Securities, thereby reestablishing Normal Units, shall be responsible for any
fees or expenses payable in connection therewith. Except as provided in the
Purchase Contract Agreement, for so long as the Purchase Contract underlying a
Stripped Unit remains in effect, such Stripped Unit shall not be separable into
its constituent parts, and the rights and obligations of the Holder of such
Stripped Unit in respect of the Pledged Treasury Security and the Purchase
Contract constituting such Stripped Unit may be transferred and exchanged only
as a Stripped Units.
B-5
The Purchase Contracts and all obligations and rights of the
Company and the Holders thereunder, including, without limitation, the rights
and obligations of Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Agent or the Company, if, on or prior to the Stock Purchase Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Agent, the Collateral Agent and to the
Holders, at their addresses as they appear in the Stripped Units Register. Upon
and after the occurrence of a Termination Event, the Collateral Agent shall
release the Pledged Treasury Securities from the Pledge in accordance with the
provisions of the Pledge Agreement.
Subject to and upon compliance with the provisions of the
Purchase Contract Agreement, at the option of the Holder thereof, Purchase
Contracts may be settled early ("Early Settlement") as provided in the Purchase
Contract Agreement. In order to exercise the right to effect Early Settlement
with respect to any Purchase Contracts evidenced by this Stripped Units
Certificate, the Holder of this Stripped Units Certificate shall deliver to the
Agent at the Corporate Trust Office an Election to Settle Early form set forth
below and any other documents requested by the Agent duly completed and
accompanied by payment in the form of immediately available funds payable to the
order of the Company in an amount (the "Early Settlement Amount") equal to the
product of (A) $50 times (B) the number of Purchase Contracts with respect to
which the Holder has elected to effect Early Settlement.
Upon Early Settlement of Purchase Contracts by a Holder of the
related Units, the Pledged Treasury Securities underlying such Units shall be
released from the Pledge as provided in the Pledge Agreement and the Holder of
each Purchase Contract forming part of Pledged Treasury Securities Units as to
which Early Settlement is effected equal to 2.3202 shares of Common Stock per
Purchase Contract (the "Early Settlement Rate"). The Early Settlement Rate shall
be adjusted in the same manner and at the same time as the Settlement Rate is
adjusted as provided in the Purchase Contract Agreement.
Upon registration of transfer of this Stripped Units
Certificate, the transferee shall be bound (without the necessity of any other
action on the part of such transferee, except as may be required by the Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Stripped Units Certificate. The Company covenants and agrees,
and the Holder, by his acceptance hereof, likewise covenants and agrees, to be
bound by the provisions of this paragraph.
The Holder of this Stripped Units Certificate, by his
acceptance hereof, authorizes the Agent to enter into and perform the related
Purchase Contracts forming part of the Stripped Units evidenced hereby on its
behalf as its attorney-in-fact, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company or its
trustee in the event that the Company becomes the subject of a case under the
Bankruptcy Code, agrees to be bound by the terms and provisions thereof,
covenants and agrees to perform such Holder's obligations under such Purchase
Contracts, consents to the provisions of the Purchase Contract Agreement,
authorizes the Agent to enter into and perform the Pledge Agreement on such
Holder's behalf as attorney-in-fact, and consents to the Pledge of the Treasury
Securities underlying this Stripped Units Certificate pursuant to the Pledge
Agreement. The Holder further covenants and agrees, that, to the extent and in
the manner provided in the Purchase Contract Agreement and the Pledge Agreement,
but subject to the terms thereof, payments in respect of the Pledged Treasury
Securities, to be paid upon settlement of such Holder's obligations to purchase
Common Stock under the Purchase Contract, shall be paid on the Stock Purchase
Date by the Collateral Agent to the Company in satisfaction of such Holder's
obligations under such Purchase Contract and such Holder shall acquire no right,
title or interest in such payments.
B-6
Each Purchase Contract evidenced hereby obligates the Holder
to agree, for U.S. tax purposes, to (i) treat an acquisition of the Stripped
Units as an acquisition of the Treasury Security and Purchase Contract
constituting the Stripped Units and (ii) treat itself as owner of the Treasury
Securities.
Subject to certain exceptions, the provisions of the Purchase
Contract Agreement may be amended with the consent of the Holders of a majority
of the Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by,
and construed in accordance with, the laws of the State of New York.
The Company, the Agent and its Affiliates and any agent of the
Company or the Agent may treat the Person in whose name this Stripped Units
Certificate is registered as the owner of the Stripped Units evidenced hereby
for the purpose of, performance of the Purchase Contracts and for all other
purposes whatsoever (subject to the Record Date provisions hereof), whether or
not any payments in respect thereof be overdue and notwithstanding any notice to
the contrary, and neither the Company, the Agent, such Affiliate, nor any such
agent shall be affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement
thereof, entitle the Holder to any of the rights of a holder of shares of Common
Stock.
A copy of the Purchase Contract Agreement is available for
inspection at the offices of the Agent.
B-7
ABBREVIATIONS
The following abbreviations, when used in the inscription on
the face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - Custodian
--------------------------------
(cust) (minor)
Under Uniform Gifts to Minors Act
--------------------------------
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of
survivorship and not as tenants in common
Additional abbreviations may also be used though not in the above list.
B-8
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Stripped Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing ____________________________ attorney to
transfer said Stripped Units Certificates on the books of Toys "R" Us, Inc. with
full power of substitution in the premises.
Dated: Signature:
------------------------ ---------------------------
NOTICE: The signature to this assignment
must correspond with the name as it
appears upon the face of the within
Stripped Units Certificates in every
particular, without alteration or
enlargement or any change whatsoever.
Signature Guarantee:
---------------------------------------------
B-9
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares
of Common Stock deliverable upon settlement on or after the Stock Purchase Date
of the Purchase Contracts underlying the number of Stripped Units evidenced by
this Stripped Units Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional share, to the undersigned at
the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated: Signature:
---------------------------- ----------------------------
Signature Guarantee:
-------------------
(if assigned to another person)
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
If shares are to be registered in REGISTERED HOLDER
the name of and delivered to a
Person other than the Holder, please Please print name and address of
(i) print such Person's name and Registered Holder:
address and (ii) provide a guarantee
of your signature:
---------------------------------- ----------------------------------
Name Name
---------------------------------- ----------------------------------
Address Address
Social Security or other Taxpayer
Identification Number, if any
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
B-10
ELECTION TO SETTLE EARLY
The undersigned Holder of this Stripped Units Certificate
hereby irrevocably exercises the option to effect Early Settlement in accordance
with the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Stripped Units evidenced by this Stripped
Units Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Stripped Units with
an aggregate Stated Amount equal to $1,000 or an integral multiple thereof. The
undersigned Holder directs that a certificate for shares of Common Stock
deliverable upon such Early Settlement be registered in the name of, and
delivered, together with a check in payment for any fractional share and any
Stripped Units Certificate representing any Stripped Units evidenced hereby as
to which Early Settlement of the related Purchase Contracts is not effected, to
the undersigned at the address indicated below unless a different name and
address have been indicated below. Pledged Treasury Securities deliverable upon
such Early Settlement will be transferred in accordance with the transfer
instructions set forth below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.
Dated: Signature:
---------------------------- ----------------------------
Signature Guarantee:
-------------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Number of Units evidenced hereby as to which Early Settlement
of the related Purchase Contracts is being elected:
If shares of Common Stock are to be REGISTERED HOLDER
registered in the name of and
delivered to and Pledged Treasury Please print name and address of
Securities are to be transferred to Registered Holder:
a Person other than the Holder,
please print such Person's name and
address:
---------------------------------- ----------------------------------
Name Name
---------------------------------- ----------------------------------
Address Address
B-11
Social Security or other Taxpayer
Identification Number, if any
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Transfer instructions for Pledged Treasury Securities
transferable upon Early Settlement or a Termination Event:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
B-12
(TO BE ATTACHED TO GLOBAL CERTIFICATES)
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global
Certificate have been made:
Stated Amount of
Amount of decrease Amount of increase the Global
in Stated Amount in Stated Amount of Certificate
of the Global the Global Following Such Signature of Authorized
Date Certificate Certificate decrease or increase Signatory
B-13
EXHIBIT C
INSTRUCTION FROM PURCHASE CONTRACT AGENT TO
COLLATERAL AGENT
JPMorgan Chase Bank,
as Collateral Agent
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Institutional Trust Services
Re: Equity Security Units of Toys "R" Us, Inc. (the "Company")
---------------------------------------------------------
We hereby notify you in accordance with Section [4.1] [4.2] of the
Pledge Agreement, dated as of May 28, 2002, (the "Pledge Agreement") among the
Company, you, as Collateral Agent, Custodial Agent and Securities Intermediary
and us, as Purchase Contract Agent and as attorney-in-fact for the holders of
Normal Units and Stripped Units from time to time, that the holder of Units
listed below (the "Holder") has elected to substitute [$_____ aggregate
principal amount of Treasury Securities (CUSIP No. 000000XX0)] [$_______
aggregate principal amount of Notes or $_____ Applicable Ownership Interest in
the Treasury Portfolio, as the case may be,] in exchange for the related
[Pledged Notes] [Pledged Applicable Ownership Interest in 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 such [Treasury Securities] [Notes] [Applicable Ownership Interest in
the Treasury Portfolio] to you, as Collateral Agent. We hereby instruct you,
upon receipt of such [Pledged Treasury Securities] [Pledged Notes] [Pledged
Applicable Ownership Interest in the Treasury Portfolio], and upon the payment
by such Holder of any applicable fees, to release the [Notes] [Applicable
Ownership Interest in the Treasury Portfolio] [Treasury Securities] related to
such [Normal Units] [Stripped Units] to us in accordance with the Holder's
instructions. Capitalized terms used herein but not defined shall have the
meaning set forth in the Purchase Contract.
C-1
Date:
---------------------
THE BANK OF NEW YORK,
as Purchase Contract Agent
By:
----------------------------
Name:
Title:
Please print name and address of Registered Holder electing to substitute
[Treasury Securities] [Notes] [Applicable Ownership Interest in the Treasury
Portfolio] for the [Pledged Notes] [Pledged Applicable Ownership Interest in the
Treasury Portfolio] [Pledged Treasury Securities]:
Name:
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Social Security or other Taxpayer
Identification Number, if any:
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Address:
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C-2
EXHIBIT D
INSTRUCTION FROM HOLDER TO PURCHASE CONTRACT AGENT
The Bank of New York,
as Purchase Contract Agent
000 Xxxxxxx Xxxxxx
Xxxxx 00 X
Xxx Xxxx, XX 00000
Attn: Corporate Trust Administration
Telecopy: 000-000-0000
Re: Equity Security Units of Toys "R" Us, Inc. (the "Company")
The undersigned Holder hereby notifies you that it has
delivered to JPMorgan Chase Bank, as Collateral Agent [$_______ aggregate
principal amount of Treasury Securities (CUSIP No. 000000XX0)] [$_______
aggregate principal amount of [Notes] [Applicable Ownership Interest in the
Treasury Portfolio] in exchange for the related [Pledged Notes] [Pledged
Applicable Ownership Interest in the Treasury Portfolio] [Pledged Treasury
Securities] held by the Collateral Agent, in accordance with Section [4.1] [4.2]
of the Pledge Agreement, dated as of May 28, 2002 (the "Pledge Agreement"),
among you, the Company and JPMorgan Chase Bank, as Collateral Agent, Custodial
Agent and Securities Intermediary. The undersigned Holder has paid the
Collateral Agent all applicable fees relating to such exchange. The undersigned
Holder hereby instructs you to instruct the Collateral Agent to release to you
on behalf of the undersigned Holder the [Pledged Notes] [Pledged Applicable
Ownership Interest in the Treasury Portfolio] [Pledged Treasury Securities]
related to such [Normal Units] [Stripped Units]. Capitalized terms used herein
but not defined shall have the meaning set forth in the Purchase Contract
Agreement.
Date: Signature:
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Signature Guarantee:
----------------------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Please print name and address of Registered Holder:
Name:
Social Security or other Taxpayer Identification Number, if any:
Address:
D-1
EXHIBIT E
NOTICE TO SETTLE BY CASH
The Bank of New York,
as Purchase Contract Agent
000 Xxxxxxx Xxxxxx
Xxxxx 00 X
Xxx Xxxx, XX 00000
Attn: Corporate Trust Administration
Telecopy: 000-000-0000
Re: Equity Security Units of Toys "R" Us, Inc. (the" Company")
The undersigned Holder hereby irrevocably notifies you in
accordance with Section 5.4(a) of the Purchase Contract Agreement dated as of
May 28, 2002 among the Company and you, as Purchase Contract Agent and as
attorney-in-fact for the Holders of the Purchase Contracts, that such Holder has
elected to pay to the Collateral Agent, on or prior to 10:00 a.m. (New York City
time) on the seventh Business Day immediately preceding the Stock Purchase Date
(in Cash) by wire transfer, in each case in immediately available funds),
$_________ as the Purchase Price for the shares of Common Stock issuable to such
Holder by the Company under the related Purchase Contract on the Stock Purchase
Date. The undersigned Holder hereby instructs you to notify promptly the
Collateral Agent of the undersigned Holder's election to make such cash
settlement with respect to the Purchase Contracts related to such Holder's
Normal Units. Capitalized terms used herein but not defined shall have the
meaning set forth in the Purchase Contract.
Date: Signature:
------------------- --------------------------------------
Signature Guarantee:
----------------------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Please print name and address of Registered Holder:
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Social Security or other Taxpayer Identification Number, if any:
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E-1
