FORM OF PLEDGE AGREEMENT
between
PROVIDENT FINANCIAL GROUP, INC.
and
X. X. XXXXXX TRUST COMPANY, NATIONAL ASSOCIATION
as Collateral Agent, Custodial Agent,
Forward Purchase Contract Agent and Securities Intermediary
Dated as of June 12, 2002
Table of Contents
Page
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ARTICLE I
DEFINITIONS
Section 1.1 Definitions..................................................................................2
ARTICLE II
Pledge; Control and Perfection
Section 2.1 The Pledge...................................................................................6
Section 2.2 Control and Perfection.......................................................................8
ARTICLE III
Distributions on Pledged Collateral
Section 3.1 Distribution.................................................................................9
ARTICLE IV
Substitution, Release, Repledge and Settlement of Preferred Stock
Section 4.1 Substitution for Preferred Stock and the Creation of Growth PRIDES..........................11
Section 4.2 Substitution of Treasury Securities and the Creation of Income PRIDES.......................11
Section 4.3 Termination Event...........................................................................12
Section 4.4 Cash Settlement.............................................................................13
Section 4.5 Early Settlement............................................................................13
Section 4.6 Application of Proceeds; Settlement.........................................................14
ARTICLE V
Voting Rights --Preferred Stock
Section 5.1 Voting Rights...............................................................................15
ARTICLE VI
Rights and Remedies
Section 6.1 Rights and Remedies of the Collateral Agent.................................................16
Section 6.2 Special Event Redemption....................................................................17
Section 6.3 Substitutions...............................................................................17
ARTICLE VII
Representations and Warranties; Covenants
Section 7.1 Representations and Warranties..............................................................18
Section 7.2 Covenants...................................................................................18
ARTICLE VIII
The Collateral Agent
Section 8.1 Appointment, Powers and Immunities..........................................................19
Section 8.2 Instructions of the Company.................................................................20
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Section 8.3 Reliance by Collateral Agent................................................................20
Section 8.4 Rights in Other Capacities..................................................................20
Section 8.5 Non-Reliance on Collateral Agent............................................................21
Section 8.6 Compensation and Indemnity..................................................................21
Section 8.7 Failure to Act..............................................................................21
Section 8.8 Resignation of Collateral Agent.............................................................22
Section 8.9 Right to Appoint Agent or Advisor...........................................................22
Section 8.10 Survival....................................................................................23
Section 8.11 Exculpation.................................................................................23
ARTICLE IX
Amendment
Section 9.1 Amendment without Consent of Holders........................................................23
Section 9.2 Amendment with Consent of Holders...........................................................24
Section 9.3 Execution of Amendments.....................................................................24
Section 9.4 Effect of Amendments........................................................................25
Section 9.5 Reference to Amendments.....................................................................25
ARTICLE X
Miscellaneous
Section 10.1 No Waiver...................................................................................25
Section 10.2 Governing Law...............................................................................25
Section 10.3 Notices.....................................................................................25
Section 10.4 Successors and Assigns......................................................................26
Section 10.5 Counterparts................................................................................26
Section 10.6 Severability................................................................................26
Section 10.7 Expenses, Etc...............................................................................26
Section 10.8 Security Interest Absolute..................................................................26
Section 10.9 Consent to Jurisdiction; Miscellaneous......................................................27
EXHIBIT A
Instruction to Collateral Agent.................................................................................A-1
EXHIBIT B
Instruction to Forward Purchase Contract Agent..................................................................B-1
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PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of June 12, 2002 (this "Agreement"), among
Provident Financial Group, Inc., a corporation organized and existing under the
laws of the State of Ohio (the "Company" or "Provident"), X. X. Xxxxxx Trust
Company, National Association, a banking corporation organized and existing
under the laws of the United States, not individually but solely as collateral
agent (in such capacity, together with its successors in such capacity, the
"Collateral Agent"), as custodial agent (in such capacity, together with its
successors in such capacity, the "Custodial Agent"), as "securities
intermediary" as defined in Section 8-102(a)(14) of the Code (as defined herein)
(in such capacity, together with its successors in such capacity, the
"Securities Intermediary"), and as forward purchase contract agent and as
attorney-in-fact of the Holders (as defined in the Forward Purchase Contract
Agreement) from time to time of the Securities (as hereinafter defined) (in such
capacity, together with its successors in such capacity, the "Forward Purchase
Contract Agent") under the Forward Purchase Contract Agreement (as herein after
defined).
RECITALS
The Company and the Forward Purchase Contract Agent are parties to the
Forward Purchase Contract Agreement, dated as of the date hereof (as modified
and supplemented and in effect from time to time, the "Forward Purchase Contract
Agreement"), pursuant to which there may be issued up to 6,000,000 PRIDES of the
Company (or 6,900,000 if the over-allotment option pursuant to the Underwriting
Agreement, dated June 6, 2002, among the Company, The Provident Bank, an Ohio
state-chartered member bank of the Federal Reserve System (the "Bank"), PFGI
Capital Corporation (the "REIT"), and the Underwriters (as defined therein) is
exercised in full), having a stated amount of $25 (the "Stated Amount") per
PRIDES.
The PRIDES will initially consist of 6,000,000 (or 6,900,000 if the
over-allotment option is exercised in full) units (referred to as "Income
PRIDES") with a face amount, per Income PRIDES, equal to the Stated Amount. Each
Income PRIDES will be comprised of (a) a stock purchase contract (the "Forward
Purchase Contract") under which the holder will purchase from the Company on
August 17, 2005 (the "Forward Purchase Contract Settlement Date"), a number of
shares of common stock, no par value (the "Common Stock"), of the Company equal
to the Settlement Rate (as defined below), and (b) either (i) one share of
Series A Non-Cumulative Preferred Stock with a liquidation preference of $25
(the "REIT Preferred Stock") issued by the REIT, or (ii) following an Automatic
Exchange (as hereinafter defined), Series A preferred stock of the Bank with a
liquidation preference of $25 (the "Bank Preferred Stock"), or (iii) following a
Special Event Redemption, the Applicable Ownership Interest in the Portfolio
Interests (each, as hereinafter defined).
As provided herein, holders of Income PRIDES may substitute collateral
in order to create units of Growth PRIDES (referred to as "Growth PRIDES" and
together, with the Income PRIDES, the "Securities"). Each Growth PRIDES so
created will be comprised of (a) a Forward Purchase Contract under which the
holder will purchase from the Company not later than the Forward Purchase
Contract Settlement Date, for an amount in cash equal to the Stated Amount, a
number of shares of Common Stock equal to the Settlement Rate, and (b) a 1/40th
undivided
beneficial interest in a zero-coupon U.S. Treasury Security (CUSIP No.
000000XX0) having a principal amount at maturity equal to the aggregate
liquidation preference of Preferred Stock for which substitution is being made
and maturing on August 15, 2005 (the "Treasury Securities").
Pursuant to the terms of the Forward Purchase Contract Agreement and
the Forward Purchase Contracts, the Holders, from time to time, of the
Securities have irrevocably authorized the Forward Purchase Contract Agent, as
attorney-in-fact of such Holders, among other things, to execute and deliver
this Agreement on behalf of such Holders and to grant the pledge provided hereby
of the Preferred Stock (as hereinafter defined), any Applicable Ownership
Interests (as specified in clause (A) of the definition of such term) in the
Treasury Portfolio (such securities (as defined in Section 8-102(a)(15) of the
Code) and Security Entitlements, collectively, the "Portfolio Interests") and
any Treasury Securities delivered in exchange or substitution therefor and all
cash and other Proceeds thereof to secure each Holder's obligations under the
related Forward Purchase Contract, as provided herein and subject to the terms
hereof. Upon such pledge, the Preferred Stock, the Portfolio Interests and the
Treasury Securities will be beneficially owned by the Holders but will be owned
of record by the Forward Purchase Contract Agent or the Securities Intermediary
subject to the Pledge hereunder.
Accordingly, the Company, the Collateral Agent, the Securities
Intermediary, the Custodial Agent and the Forward Purchase Contract Agent, on
its own behalf and as attorney-in-fact of the Holders from time to time of the
Securities, agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1 Definitions. For all purposes of this agreement,
except as otherwise expressly provided or unless the context otherwise
requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular;
(b) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Agreement as a whole and not to
any particular Article, Section or other subdivision;
(c) capitalized terms used but not otherwise defined herein
have the meanings assigned to such terms in the Forward Purchase
Contract Agreement; and
(d) terms used herein and defined in Article 8 or 9 of the
Code and not otherwise defined herein are used herein as defined in
Article 8 or 9 of the Code.
"Agreement" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Applicable Ownership Interest" has the meaning specified in the
Forward Purchase Contract Agreement.
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"Automatic Exchange" has the meaning specified in the Forward Purchase
Contract Agreement.
"Bank" has the meaning specified in the Recitals.
"Bank Preferred Stock" has the meaning specified in the Recitals.
"Cash" means any coin or currency of the United States as at the time
shall be legal tender for payment of public and private debts.
"Code" has the meaning specified in Section 6.1 hereof.
"Collateral" has the meaning specified in Section 2.1 hereof.
"Collateral Account" means the securities account (number ) maintained
at X.X. Xxxxxx Trust Company, National Association in the name "X. X. Xxxxxx
Trust Company, National Association, as Forward Purchase Contract Agent on
behalf of the holders of certain securities of Provident Financial Group, Inc.,
subject to the security interest of X. X. Xxxxxx Trust Company, National
Association, as Collateral Agent, for the benefit of Provident Financial Group,
Inc., as pledgee" and any successor account.
"Collateral Agent" has the meaning specified in the first paragraph of
this Agreement.
"Common Stock" has the meaning specified in the Recitals.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such, and
thereafter "Company" shall mean such successor.
"Custodial Agent" has the meaning specified in the Recitals.
"Failed Remarketing" has the meaning specified in the Forward Purchase
Contract Agreement.
"Forward Purchase Contract" has the meaning specified in the Recitals.
"Forward Purchase Contract Agent" has the meaning specified in the
first paragraph of this Agreement.
"Forward Purchase Contract Agreement" has the meaning specified in the
Recitals.
"Forward Purchase Contract Settlement Date" has the meaning specified
in the Recitals.
"Growth PRIDES" has the meaning specified in the Forward Purchase
Contract Agreement.
"Holder" has the meaning specified in the Forward Purchase Contract
Agreement.
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"Income PRIDES" has the meaning specified in the Forward Purchase
Contract Agreement.
"Intermediary" means any entity that in the ordinary course of its
business maintains securities accounts for others and is acting in that
capacity.
"Old Stock Certificates" has the meaning specified in Section 4.6
hereof.
"Permitted Investments" means any one of the following which shall
mature not later than the next succeeding Business Day: (i) any evidence of
indebtedness with an original maturity of 365 days or less issued, or directly
and fully guaranteed or insured, by the United States of America or any agency
or instrumentality thereof (provided that the full faith and credit of the
United States of America is pledged in support thereof or such indebtedness
constitutes a general obligation of it); (ii) deposits, certificates of deposit
or acceptances with an original maturity of 365 days or less of any institution
which is a member of the Federal Reserve System having combined capital and
surplus and undivided profits of not less than US$200,000,000 at the time of
deposit; (iii) investments with an original maturity of 365 days or less of any
Person that are fully and unconditionally guaranteed by a bank of the type
referred to in clause (ii); (iv) investments in commercial paper, other than
commercial paper issued by the Company or its affiliates, of any corporation
incorporated under the laws of the United States or any State thereof, which
commercial paper has a rating at the time of purchase at least equal to "A-1" by
Standard & Poor's Ratings Services ("S&P") or at least equal to "P-1" by Xxxxx'x
Investors Service, Inc. ("Moody's"); and (v) investments in money market funds
registered under the Investment Company Act of 1940, as amended, and rated in
the highest applicable rating category by S&P or Moody's.
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Pledge" has the meaning specified in Section 2.1 hereof.
"Pledged Portfolio Interests" has the meaning specified in Section 2.1
hereof.
"Pledged Preferred Stock" has the meaning specified in Section 2.1
hereof.
"Pledged Treasury Securities" has the meaning specified in Section 2.1
hereof.
"Portfolio Interests" has the meaning specified in the Recitals.
"Preferred Stock" means the REIT Preferred Stock or, in the event an
Automatic Exchange has occurred, Bank Preferred Stock.
"Proceeds" means all interest, dividends, cash, instruments,
securities, distributions, financial assets (as defined in Section 8-102(a)(9)
of the Code) and other property from time to time received, receivable or
otherwise distributed upon the sale, exchange, collection or disposition of the
Collateral or any proceeds thereof.
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"Purchase Price" has the meaning specified in the Forward Purchase
Contract Agreement.
"Redemption Date" has the meaning specified in the Forward Purchase
Contract Agreement.
"REIT" has the meaning specified in the Recitals.
"REIT Preferred Stock" has the meaning specified in the Recitals.
"Remarketing Agent" means the remarketing agent under the Remarketing
Agreement.
"Remarketing Agreement" means the remarketing agreement among the
Company, the Forward Purchase Contract Agent and Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated dated as of the date hereof.
"Remarketing Underwriting Agreement" means the Remarketing Underwriting
Agreement attached as Exhibit A to the Remarketing Agreement.
"Securities" has the meaning specified in the Recitals.
"Securities Intermediary" has the meaning specified in the first
paragraph of this Agreement.
"Security Entitlement" has the meaning set forth in Section
8-102(a)(17) of the Code.
"Separate Preferred Stock" means any Preferred Stock that is not
Pledged Preferred Stock.
"Stated Amount" has the meaning specified in the Recitals.
"Special Event Redemption" has the meaning specified in the Forward
Purchase Contract Agreement.
"Special Event Redemption Date" means the date upon which a Special
Event Redemption is to occur.
"TRADES" means the Treasury/Reserve Automated Debt Entry System
maintained by the Federal Reserve Bank of New York pursuant to the TRADES
Regulations.
"TRADES Regulations" means the regulations of the United States
Department of the Treasury, published at 31 C.F.R. Part 357, as amended from
time to time. Unless otherwise defined herein, all terms defined in the TRADES
Regulations are used herein as therein defined.
"Transfer" means, with respect to the Collateral and in accordance with
the instructions of the Collateral Agent, the Forward Purchase Contract Agent or
the Holder, as applicable:
(i) in the case of Collateral consisting of securities which
cannot be delivered by book-entry or which the parties agree are to be
delivered in
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physical form, delivery in appropriate physical form to the recipient
accompanied by any duly executed instruments of transfer, undated stock
powers duly endorsed in blank, assignments in blank, transfer tax
stamps and any other documents necessary to constitute a legally valid
transfer to the recipient; and
(ii) in the case of Collateral consisting of securities
maintained in book-entry form, by causing a "securities intermediary"
(as defined in Section 8-102(a)(14) of the Code) to: (i) credit a
"security entitlement" (as defined in Section 8-102(a)(17) of the Code)
with respect to such securities to a "securities account" (as defined
in Section 8-501(a) of the Code) maintained by or on behalf of the
recipient; and (ii) to issue a confirmation to the recipient with
respect to such credit. In the case of Collateral to be delivered to
the Collateral Agent, the securities intermediary shall be the
Securities Intermediary and the securities account shall be the
Collateral Account.
"Treasury Portfolio" has the meaning specified in the Forward Purchase
Contract Agreement.
"Treasury Securities" has the meaning specified in the Recitals.
"Trust" has the meaning specified in the Recitals.
"Value" with respect to any item of Collateral on any date means, as
to: (i) a share of Preferred Stock, the Liquidation Preference thereof, (ii)
Cash, the face amount thereof; and (iii) Treasury Securities and Applicable
Ownership Interests (as specified in clause (A) of the definition of such term)
in the Portfolio Interests, the aggregate principal amount thereof at maturity.
ARTICLE II
Pledge; Control and Perfection
Section 2.1 The Pledge. The Holders from time to time acting
through the Forward Purchase Contract Agent, as their attorney-in-fact, and the
Forward Purchase Contract Agent, as such attorney-in-fact, hereby pledge and
grant to the Collateral Agent, for the benefit of the Company, as collateral
security for the performance when due by such Holders (whether now owned,
hereafter acquired, or whether now or hereafter existing or arising) of their
respective obligations under the related Forward Purchase Contracts, a security
interest in all of the right, title and interest of the Forward Purchase
Contract Agent and such Holders in (a) Preferred Stock constituting a part of
Income PRIDES from time to time; (b) Treasury Securities constituting a part of
the Growth PRIDES from time to time, (c) the Applicable Ownership Interests (as
specified in Clause (A) of the definition of such term) of the Treasury
Portfolio constituting a part of Income PRIDES from time to time after the
occurrence of a Special Event Redemption; (d) payments made by Holders pursuant
to Section 4.4.; (e) the Collateral Account and all securities, financial assets
(as defined in Section 8-102(a)(9) of the Code), Cash and other property
credited thereto and all Security Entitlements related thereto; and (f) all
Proceeds of the foregoing (all of the foregoing, collectively, the
"Collateral"). The pledge provided in this Section 2.1 is herein referred to as
the "Pledge" and the Preferred Stock, the Treasury Securities and the Portfolio
Interests subject to the Pledge, excluding any Preferred Stock that are
delivered
6
pursuant to Section 6.4 hereof and Treasury Securities or Portfolio
Interests released from the Pledge as provided in Sections 4.1 and 4.2 hereof,
respectively are hereinafter referred to as the "Pledged Preferred Stock,"
"Pledged Treasury Securities" and the "Pledged Portfolio Interests,"
respectively.
Prior to or concurrently with the execution and delivery of this
Agreement, the Forward Purchase Contract Agent, on behalf of the initial Holders
of the Securities, shall cause the Preferred Stock comprising a part of the
Income PRIDES to be Transferred to the Collateral Agent for the benefit of the
Company. Such Preferred Stock shall be Transferred by physically delivering such
Preferred Stock to the Collateral Agent endorsed in blank or together with such
powers undated and duly endorsed in blank as the Collateral Agent or the
Company, which Transfer shall constitute delivery (as defined in Section 8-301
of the Code) of the Preferred Stock. The Collateral Agent shall deliver such
Preferred Stock to the Securities Intermediary and the Securities Intermediary
will credit the Collateral Account with such Preferred Stock such that any
Security Entitlement with respect to such Preferred Stock is credited to such
Collateral Account. In the event a Holder of Income PRIDES so elects, such
Holder may Transfer Treasury Securities to the Collateral Agent for the benefit
of the Company (as provided in Section 4.1 hereof) in exchange for the release
by the Collateral Agent on behalf of the Company to the Forward Purchase
Contract Agent of Preferred Stock or Portfolio Interests, as the case may be,
with a Liquidation Preference equal to the aggregate principal amount of the
Treasury Securities so Transferred, in the case of the Preferred Stock, or with
an appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, equal to the aggregate
principal amount of the Treasury Securities so Transferred. In the event a
Holder of Growth PRIDES so elects, such Holder may Transfer Preferred Stock or
Portfolio Interests to the Collateral Agent for the benefit of the Company in
exchange for the release by the Collateral Agent on behalf of the Company (as
provided in Section 4.2 hereof) to the Forward Purchase Contract Agent of
Treasury Securities with an aggregate principal amount at maturity equal to, as
the case may be, the aggregate Liquidation Preference of the Preferred Stock or
the aggregate principal amount at maturity of the appropriate Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio, so Transferred to the Forward Purchase Contract Agent
on behalf of such Holder. Such Treasury Securities and Portfolio Interests, as
applicable, shall be Transferred to the Collateral Account maintained by the
Collateral Agent at the Securities Intermediary by book-entry transfer to the
Collateral Account in accordance with the TRADES Regulations and other
applicable law and by the notation by the Securities Intermediary on its books
that a Security Entitlement with respect to such Treasury Securities or such
Portfolio Interests has been credited to the Collateral Account. For purposes of
perfecting the Pledge under applicable law, including, to the extent applicable,
the TRADES Regulations or the Uniform Commercial Code as adopted and in effect
in any applicable jurisdiction, the Collateral Agent shall be the agent of the
Company as provided herein. Subject to the Pledge and the provisions of Section
2.2 hereof, the Holders from time to time shall have full beneficial ownership
of the Collateral. Whenever directed by the Collateral Agent acting on behalf of
the Company, the Securities Intermediary shall have the right to reregister the
Preferred Stock or any other Securities held in physical form in its name for
the benefit of the Company.
Except as may be required in order to release Preferred Stock in
connection with a Holder's election to convert its investment from an Income
PRIDES to a Growth PRIDES, or
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except as otherwise required to release Securities as specified herein, neither
the Collateral Agent nor the Securities Intermediary shall relinquish physical
possession of any security certificate evidencing a Preferred Stock prior to the
termination of this Agreement except Preferred Stock may be held in any clearing
corporation in an account including only assets of customers of the Collateral
Agent or Securities Intermediary. If it becomes necessary for the Securities
Intermediary to relinquish physical possession of a security certificate in
order to release a portion of the Pledged Preferred Stock evidenced thereby from
the Pledge, the Securities Intermediary shall use its best efforts to obtain
physical possession of a replacement security certificate evidencing any
Preferred Stock remaining subject to the Pledge hereunder registered to it or
endorsed in blank within fifteen days of the date it relinquished possession.
The Securities Intermediary shall promptly notify the Company and the Collateral
Agent of the Securities Intermediary's failure to obtain possession of any such
replacement certificate as required hereby.
Section 2.2 Control and Perfection. (a) In connection with the
Pledge granted in Section 2.1, and subject to the other provisions of this
Agreement, the Holders from time to time acting through the Forward Purchase
Contract Agent, as their attorney-in-fact, and the Forward Purchase Contract
Agent hereby authorize and direct the Securities Intermediary (without the
necessity of obtaining the further consent of, or giving notice to, the Forward
Purchase Contract Agent or any of the Holders), and the Securities Intermediary
agrees, to comply with and follow any instructions and entitlement orders (as
defined in Section 8-102(a)(8) of the Code) that the Collateral Agent on behalf
of the Company may give in writing with respect to the Collateral Account, the
Collateral credited thereto and any Security Entitlements with respect to any
thereof. Such instructions and entitlement orders may, without limitation,
direct the Securities Intermediary to transfer, redeem, sell, liquidate, assign,
deliver or otherwise dispose of the Preferred Stock, the Treasury Securities,
the Portfolio Interests and any Security Entitlements with respect thereto and
to pay and deliver any income, Proceeds or other funds derived therefrom to the
Company. The Holders from time to time acting through the Forward Purchase
Contract Agent hereby further authorize and direct the Collateral Agent, as
agent of the Company, to itself issue instructions and entitlement orders, and
to otherwise take action, with respect to the Collateral Account, the Collateral
credited thereto and any Security Entitlements with respect thereto, pursuant to
the terms and provisions hereof, all without the necessity of obtaining the
further consent of or giving notice to the Forward Purchase Contract Agent or
any of the Holders. The Collateral Agent shall be the agent of the Company and
shall act as directed in writing by the Company. Without limiting the generality
of the foregoing, the Collateral Agent shall issue entitlement orders to the
Securities Intermediary when and as directed by the Company.
(b) The Securities Intermediary hereby confirms and agrees
that: (i) it is a Person that in the ordinary course of business
maintains securities accounts for others and is acting in that
capacity; (ii) all securities or other property underlying any
financial assets credited to the Collateral Account shall be registered
in the name of the Collateral Agent, endorsed to the Securities
Intermediary or in blank or credited to another Securities Account
maintained in the name of the Collateral Agent and in no case will any
financial asset credited to the Collateral Account be registered in the
name of the Forward Purchase Contract Agent, the Company or any Holder,
payable to the order of, or specially endorsed to, the Forward Purchase
Agent, the Company or any Holder except
8
to the extent the foregoing have been specially endorsed to the
Collateral Agent or in blank; (iii) all property delivered to the
Securities Intermediary pursuant to this Pledge Agreement (including,
without limitation, any Preferred Stock, the Portfolio Interests or
Treasury Securities) will be promptly credited to the Collateral
Account; (iv) the Collateral Account is an account to which financial
assets are or may be credited, and the Securities Intermediary shall,
subject to the terms of this Agreement, treat the Collateral Agent as
entitled to exercise the rights of any financial asset credited to the
Collateral Account; (v) the Securities Intermediary has not entered
into, and until the termination of this Agreement will not enter into,
any agreement with any other Person relating to the Collateral Account
and/or any financial assets credited thereto pursuant to which it has
agreed to comply with entitlement orders (as defined in Section
8-102(a)(8) of the Code) of such other Person; and (vi) the Securities
Intermediary has not entered into, and until the termination of this
Agreement, except to the extent permitted hereunder, will not enter
into, any agreement with the Company, any Holder or the Forward
Purchase Contract Agent purporting to limit or condition the obligation
of the Securities Intermediary to comply with entitlement orders as set
forth in this Section 2.2 hereof.
(c) The Securities Intermediary hereby agrees that each item
of property (whether investment property, financial asset, security,
instrument or cash) credited to the Collateral Account shall be treated
as a "financial asset" within the meaning of Section 8-102(a)(9) of the
Code.
(d) In the event of any conflict between this Agreement (or
any portion thereof) and any other agreement now existing or hereafter
entered into, the terms of this Agreement shall prevail.
(e) The Forward Purchase Contract Agent hereby irrevocably
constitutes and appoints the Collateral Agent and the Company, with
full power of substitution, as the Forward Purchase Contract Agent's
attorney-in-fact to take on behalf of, and in the name, place and stead
of, the Forward Purchase Contract Agent and the Holders, any action
necessary or desirable to perfect and to keep perfected the security
interest in the Collateral referred to in Section 2.1. The grant of
such power-of-attorney shall not be deemed to require of the Collateral
Agent any specific duties or obligations not otherwise assumed by the
Collateral Agent hereunder.
ARTICLE III
Distributions on Pledged Collateral
Section 3.1 Distributions. So long as the Forward Purchase
Contract Agent is the registered holder of the Pledged Preferred Stock and is
acting in such capacity, it shall receive all payments thereon. If the Pledged
Preferred Stock are reregistered, such that the Collateral Agent becomes the
registered holder, all payments of the Liquidation Preference, or dividend
payments on, the Pledged Preferred Stock or, if applicable, principal payments
or other cash distributions on the Pledged Portfolio Interests, as the case may
be, and all payments of the principal of, or cash distributions on, any Pledged
Treasury Securities received by the Collateral Agent that are properly payable
hereunder shall be paid by the Collateral Agent by wire transfer in immediately
available funds:
9
(i) In the case of (A) dividend payments with respect to the
Pledged Preferred Stock or payments with respect to the appropriate
Applicable Ownership Interest (as specified in clause (B) of the
definition of such term) of the Treasury Portfolio, as the case may be,
and (B) any payments of the Liquidation Preference with respect to any
Preferred Stock or payments at maturity on the Pledged Portfolio
Interests, as the case may be, that have been released from the Pledge
pursuant to Section 4.1 or Section 4.3 hereof, to the Forward Purchase
Contract Agent, for the benefit of the relevant Holders of Securities,
to the account designated by the Forward Purchase Contract Agent for
such purpose, no later than 2:00 p.m., New York City time, on the
Business Day such payment is received by the Collateral Agent (provided
that in the event such payment is received by the Collateral Agent on a
day that is not a Business Day or after 12:30 p.m., New York City time,
on a Business Day, then such payment shall be made no later than 10:30
a.m., New York City time, on the next succeeding Business Day);
(ii) In the case of any principal payments with respect to any
Treasury Securities that have been released from the Pledge pursuant to
Section 4.2 or Section 4.3 hereof, to the Forward Purchase Contract
Agent for the benefit of the Holders of the Growth PRIDES, to the
account designated by the Forward Purchase Contract Agent for such
purpose no later than 2:00 p.m., New York City time, on the Business
Day such payment is received by the Collateral Agent (provided that in
the event such payment is received by the Collateral Agent on a day
that is not a Business Day or after 12:30 p.m., New York City time, on
a Business Day, then such payment shall be made no later than 10:30
a.m., New York City time, on the next succeeding Business Day); and
(iii) In the case of payments of Proceeds of any Pledged
Preferred Stock or Pledged Portfolio Interests, as the case may be, or
the Proceeds of any Pledged Treasury Securities, to the Company, the
REIT or the Bank, as the case may be, on the Forward Purchase Contract
Settlement Date to the extent of the Purchase Price in accordance with
the procedure set forth in Section 4.6(a) or 4.6(b) hereof, in full
satisfaction of the respective obligations of the Holders under the
related Forward Purchase Contracts and, to the extent such Proceeds
exceed the Purchase Price, to the Forward Purchase Contract Agent for
the benefit of the Holders.
All payments received by the Forward Purchase Contract Agent as
provided herein shall be applied by the Forward Purchase Contract Agent pursuant
to the provisions of the Forward Purchase Contract Agreement. If,
notwithstanding the foregoing, the Forward Purchase Contract Agent shall receive
any payments of the Liquidation Preference on account of any Preferred Stock or,
if applicable, payments at maturity on the Pledged Portfolio Interests or a
Holder of a Growth PRIDES shall receive any payments of principal on account of
any Treasury Securities that, at the time of such payment, are Pledged Treasury
Securities, the Forward Purchase Contract Agent or such Holder shall hold the
same as trustee of an express trust for the benefit of the Company (and promptly
deliver the same over to the Company) for application to the obligations of the
Holders under the related Forward Purchase Contracts, and the Holders shall
acquire no right, title or interest in any such payments of Liquidation
Preference or principal so received.
10
ARTICLE IV
Substitution, Release, Repledge and Settlement of Preferred Stock
Section 4.1 Substitution for Preferred Stock and the Creation of
Growth PRIDES. At any time on or prior to the seventh Business Day immediately
preceding the Forward Purchase Contract Settlement Date (or on or prior to the
second Business Day immediately preceding the Forward Purchase Contract
Settlement Date, if a Special Event Redemption has occurred), a Holder of Income
PRIDES shall have the right to substitute Treasury Securities for the Pledged
Preferred Stock (or, if a Special Event Redemption has occurred, the appropriate
Portfolio Interests) securing such Holder's obligations under the Forward
Purchase Contract(s) comprising a part of its Income PRIDES in integral
multiples of 40 Income PRIDES by (a) Transferring to the Collateral Agent
Treasury Securities having a Value equal to the aggregate Liquidation Preference
of the Preferred Stock (or the aggregate principal amount of the appropriate
Portfolio Interests, as the case may be), to be released, and (b) delivering the
related Income PRIDES to the Forward Purchase Contract Agent, accompanied by a
notice, substantially in the form of Exhibit B hereto, to the Forward Purchase
Contract Agent stating that such Holder has Transferred Treasury Securities to
the Collateral Agent pursuant to clause (a) above (stating the Value of the
Treasury Securities Transferred by such Holder) and requesting that the Forward
Purchase Contract Agent instruct the Collateral Agent to release from the Pledge
the Pledged Preferred Stock or the Pledged Portfolio Interests, as the case may
be, related to such Income PRIDES. The Forward Purchase Contract Agent shall
instruct the Collateral Agent in the form provided in Exhibit A; provided,
however, that if a Special Event Redemption has occurred and the Portfolio
Interests have become a component of the Income PRIDES, Holders of Income PRIDES
may make such substitution only in integral multiples of [ ] Income PRIDES at
any time on or prior to the second Business Day immediately preceding the
Forward Purchase Contract Settlement Date. Upon receipt of Treasury Securities
from a Holder of Income PRIDES and the related instruction from the Forward
Purchase Contract Agent, the Collateral Agent shall release the Pledged
Preferred Stock or the Pledged Portfolio Interests, as the case may be, and
shall promptly Transfer such Pledged Preferred Stock or Pledged Portfolio
Interests, as the case may be, free and clear of any lien, pledge or security
interest created hereby, to the Forward Purchase Contract Agent. All items
Transferred and/or substituted by any Holder pursuant to this Section 4.1,
Section 4.2 or any other Section of this Agreement shall be Transferred and/or
substituted free and clear of all liens, claims and encumbrances.
Section 4.2 Substitution of Treasury Securities and the Creation
of Income PRIDES. At any time on or prior to the seventh Business Day
immediately preceding the Forward Purchase Contract Settlement Date (or on or
prior to the second Business Day immediately preceding the Forward Purchase
Contract Settlement Date, if a Special Event Redemption has occurred), a Holder
of Growth PRIDES shall have the right to reestablish Income PRIDES consisting of
the Forward Purchase Contracts and Preferred Stock in integral multiples of 40
Income PRIDES by (a) Transferring to the Collateral Agent Preferred Stock having
a Value equal to the Value of the Pledged Treasury Securities to be released (or
the appropriate Applicable Ownership Interests (as specified in clause (A) of
the definition of such term) in the Portfolio Interests having a Value equal to
the Value of the Pledged Treasury Securities to be released) and (b) delivering
the related Growth PRIDES to the Forward Purchase Contract Agent, accompanied by
a notice, substantially in the form of Exhibit B hereto, to the Forward Purchase
Contract Agent stating that such Holder has transferred the relevant amount of
11
Preferred Stock (or the appropriate Portfolio Interests, as the case may be) to
the Collateral Agent pursuant to clause (a) above and requesting that the
Forward Purchase Contract Agent instruct the Collateral Agent to release from
the Pledge the Pledged Treasury Securities related to such Growth PRIDES. The
Forward Purchase Contract Agent shall instruct the Collateral Agent in the form
provided in Exhibit A; provided, however, that if a Special Event Redemption has
occurred and the Treasury Portfolio has become a component of the Income PRIDES,
Holders of Growth PRIDES may make such substitution only in integral multiples
of [ ] Growth PRIDES at any time on or prior to the second Business Day
immediately preceding the Forward Purchase Contract Settlement Date. Upon
receipt of the Preferred Stock or the Applicable Ownership Interests (as
specified in clause (A) of the definition of such term) in the Portfolio
Interests as the case may be, from such Holder and the instruction from the
Forward Purchase Contract Agent, the Collateral Agent shall release the Treasury
Securities having a corresponding aggregate principal amount from the Pledge and
shall promptly Transfer such Treasury Securities, free and clear of any lien,
pledge or security interest created hereby, to the Forward Purchase Contract
Agent.
Section 4.3 Termination Event. Upon receipt by the Collateral
Agent of written notice from the Company or the Forward Purchase Contract Agent
that there has occurred a Termination Event, the Collateral Agent shall release
all Collateral from the Pledge and shall promptly Transfer any Pledged Preferred
Stock (or Pledged Portfolio Interests if a Special Event Redemption has
occurred) and Pledged Treasury Securities to the Forward Purchase Contract Agent
for the benefit of the Holders of the Income PRIDES and the Growth PRIDES,
respectively, free and clear of any lien, pledge or security interest or other
interest created hereby.
If such Termination Event shall result from the Company's becoming a
debtor under any applicable uniform bankruptcy laws, and if the Collateral Agent
shall for any reason fail promptly to effectuate the release and Transfer of all
Pledged Preferred Stock, the Pledged Portfolio Interests or of the Pledged
Treasury Securities, as the case may be, as provided by this Section 4.3, the
Forward Purchase Contract Agent shall (i) use its best efforts to obtain an
opinion of a recognized law firm practicing law in the applicable jurisdiction
to the effect that, as a result of the Company's being the debtor in such a
bankruptcy case, the Collateral Agent will not be prohibited from releasing or
Transferring the Collateral as provided in this Section 4.3, and shall deliver
such opinion to the Collateral Agent within ten days after the occurrence of
such Termination Event, and if (y) the Forward Purchase Contract Agent shall be
unable to obtain such opinion within ten days after the occurrence of such
Termination Event or (z) the Collateral Agent shall continue, after delivery of
such opinion, to refuse to effectuate the release and Transfer of all Pledged
Preferred Stock, the Pledged Portfolio Interests or the Pledged Treasury
Securities, as the case may be, as provided in this Section 4.3, then the
Forward Purchase Contract Agent shall within fifteen days after the occurrence
of such Termination Event commence an action or proceeding in the court with
jurisdiction of the Company's case under the any such applicable bankruptcy laws
seeking an order requiring the Collateral Agent to effectuate the release and
transfer of all Pledged Preferred Stock, the Pledged Portfolio Interests or of
the Pledged Treasury Securities, as the case may be, as provided by this Section
4.3 or (ii) commence an action or proceeding like that described in subsection
(i)(z) hereof within ten days after the occurrence of such Termination Event.
12
Section 4.4 Cash Settlement. (a) Upon receipt by the Collateral
Agent of (i) a notice from the Forward Purchase Contract Agent promptly after
the receipt by the Forward Purchase Contract Agent of such notice that a Holder
of an Income PRIDES or Growth PRIDES has elected, in accordance with the
procedures specified in Section 5.3(a)(i) or (b)(i) of the Forward Purchase
Contract Agreement, respectively, to settle its Forward Purchase Contract with
Cash and (ii) payment of the amount required to settle such contract by such
Holder on or prior to 11:00 a.m., New York City time, on the Business Day
immediately preceding the Forward Purchase Contract Settlement Date in lawful
money of the United States by certified or cashiers' check or wire transfer in
immediately available funds payable to or upon the order of the Company, then
the Collateral Agent shall (pursuant to the written direction of the Company,
which may be in the form of a standing order) promptly invest any Cash received
from a Holder in connection with a Cash Settlement in Permitted Investments.
Upon receipt of the Proceeds upon the maturity of the Permitted Investments on
the Forward Purchase Contract Settlement Date, the Collateral Agent shall pay
the portion of such Proceeds and deliver any certified or cashiers' checks
received and any funds so wired, in an aggregate amount equal to the Purchase
Price, to the Company on the Forward Purchase Contract Settlement Date, and
shall distribute any funds in respect of the interest earned from the Permitted
Investments to the Forward Purchase Contract Agent for payment to the relevant
Holder.
(b) If a Special Event Redemption, Early Settlement or a
Termination Event has not occurred, and a Holder of an Income PRIDES
fails to notify the Forward Purchase Contract Agent of its intention to
make a Cash Settlement in accordance with Section 5.3(a)(i) of the
Forward Purchase Contract Agreement and the Holder shall be deemed to
have consented to the disposition of the Pledged Preferred Stock
pursuant to the remarketing as described in Section 5.2 of the Forward
Purchase Contract Agreement, which is incorporated herein by reference.
If a Holder of an Income PRIDES does notify the Forward Purchase
Contract Agent as provided in Section 5.3(a)(i) of the Forward Purchase
Contract Agreement of its intention to pay the Purchase Price in cash,
but fails to make such payment as required by Section 5.3(a)(ii) of the
Forward Purchase Contract Agreement and the Preferred Stock of such a
Holder will not be remarketed but instead the Collateral Agent, for the
benefit of the Company shall, in exercise of its rights as a secured
party with respect to such Preferred Stock and in full satisfaction of
the Holders' obligations under the Forward Purchase Contract Agreement
to pay the Purchase Price for the Common Stock, transfer such Preferred
Stock to the Bank, representing a capital contribution of such
Preferred Stock by the Company to the Bank.
Section 4.5 Early Settlement. Upon written notice to the
Collateral Agent by the Forward Purchase Contract Agent that one or more Holders
of Securities have elected to effect Early Settlement of their respective
obligations under the Forward Purchase Contracts forming a part of such
Securities in accordance with the terms of the Forward Purchase Contracts and
the Forward Purchase Contract Agreement (setting forth the number of such
Forward Purchase Contracts as to which such Holders have elected to effect Early
Settlement), and that the Forward Purchase Contract Agent has received from such
Holders, and paid to the Company as confirmed in writing by the Company, the
related Early Settlement Amounts pursuant to the terms of the Forward Purchase
Contracts and the Forward Purchase Contract Agreement and that all conditions to
such Early Settlement have been satisfied, then the Collateral Agent shall
release from the Pledge, (a) Pledged Preferred Stock or the Pledged Portfolio
Interests, as the case may
13
be, in the case of a Holder of Income PRIDES or (b) Pledged Treasury Securities
in the case of a Holder of Growth PRIDES, as the case may be, in each case with
a Liquidation Preference or principal amount at maturity, as applicable, equal
to the product of (i) the Stated Amount times (ii) the number of such Forward
Purchase Contracts as to which such Holders have elected to effect Early
Settlement and shall Transfer all such Pledged Preferred Stock, the Pledged
Portfolio Interests, or Pledged Treasury Securities, as the case may be, free
and clear of the Pledge created hereby, to the Forward Purchase Contract Agent
for the benefit of the Holders.
Section 4.6 Application of Proceeds; Settlement. (a) In the event
a Holder of Income PRIDES (unless a Special Event Redemption, Early Settlement
or a Termination Event has occurred) has not made an effective Cash Settlement
by notifying the Forward Purchase Contract Agent in the manner provided for in
Section 5.3(a)(i) in the Forward Purchase Contract Agreement, such Holder shall
be deemed to have elected to pay for the Common Stock to be issued under such
Forward Purchase Contract(s) from the Proceeds of the related Pledged Preferred
Stock. Upon notice in writing from the Remarketing Agent of a Successful
Remarketing, no later than two Business Days prior to the Forward Purchase
Contract Settlement Date, the REIT or the Bank, as the case may be, will
promptly deliver to the Collateral Agent one or more certificates representing
the remarketed Preferred Stock (containing the dividend rate, CUSIP number, a
designation as "Series A-R Non-Cumulative Preferred Stock" and redemption date
applicable following remarketing) to replace the certificate or certificates
previously representing the remarketed Preferred Stock (the "Old Stock
Certificates") and upon receipt thereof, the Collateral Agent shall without any
instruction from such Holder of Income PRIDES, cancel and destroy the Old Stock
Certificates. The Collateral Agent shall deliver the new certificates
representing the remarketed Preferred Stock to the Remarketing Agent in exchange
for the Proceeds from the remarketing (minus the remarketing fee, if any,
pursuant to the Remarketing Agreement). With respect to that portion of the
Proceeds from such remarketing equal to the aggregate Liquidation Preference of
such remarketed Preferred Stock, the Collateral Agent shall transfer such
Proceeds to the REIT or, if an Automatic Exchange has previously occurred, to
the Bank in accordance with the written instructions of the REIT or the Bank, as
the case may be. With respect to that portion of the remarketing Proceeds in
excess of the aggregate Liquidation Preference, if any, the Collateral Agent
shall remit such Proceeds to the Forward Purchase Contract Agent for payment to
the Holders.
In the event that the Remarketing Agent advises the Collateral Agent in
writing that a Failed Remarketing has occurred, the Collateral Agent, for the
benefit of the Company shall, on the Forward Purchase Contract Settlement Date,
in exercise of its rights as a secured party with respect to the relevant
Pledged Preferred Stock and in full satisfaction of the relevant Holders'
obligations under the Forward Purchase Contract Agreement to pay the Purchase
Price for the Common Stock, promptly transfer such Preferred Stock to the Bank,
representing a capital contribution of such Preferred Stock by the Company to
the Bank.
(b) In the event a Holder of Growth PRIDES or, if a Special
Event Redemption has occurred, Income PRIDES has not made an Early
Settlement or Cash Settlement of the Forward Purchase Contract(s)
underlying its Growth PRIDES or Income PRIDES prior to 11:00 a.m. (New
York City time) on the Business Day immediately preceding the Forward
Purchase Contract Settlement Date), such Holder shall be deemed to have
elected to pay for the Common Stock to be issued under such
14
Forward Purchase Contract(s) from the Proceeds of the related Pledged
Treasury Securities or Pledged Portfolio Interests, as the case may be.
On the Business Day immediately prior to the Forward Purchase Contract
Settlement Date, the Collateral Agent shall invest (pursuant to the
written direction of the Company, which may be in the form of a
standing order) the Cash Proceeds of the maturing Pledged Treasury
Securities, or the maturing Pledged Portfolio Interests, as the case
may be, in any overnight Permitted Investments. Without receiving any
instruction from any such Holder of Growth PRIDES or Income PRIDES, the
Collateral Agent shall apply the Proceeds of the related Pledged
Treasury Securities or Pledged Portfolio Interests to the settlement of
such Forward Purchase Contracts on the Forward Purchase Contract
Settlement Date. In the event the sum of the Proceeds from the related
Pledged Treasury Securities or Pledged Portfolio Interests, as the case
may be, and the investment earnings from the investment in overnight
Permitted Investments is in excess of the aggregate Purchase Price of
the Forward Purchase Contracts being settled thereby, the Collateral
Agent will distribute such excess to the Forward Purchase Contract
Agent for the benefit of the Holder of the related Growth PRIDES or
Income PRIDES when received.
ARTICLE V
Voting Rights -- Preferred Stock
Section 5.1 Voting Rights. Provided no default hereunder or under
the Forward Purchase Contract exists, the Forward Purchase Contract Agent may
exercise, or refrain from exercising, any and all voting and other consensual
rights pertaining to the Pledged Preferred Stock or any part thereof for any
purpose not inconsistent with the terms of this Agreement and in accordance with
the terms of the Forward Purchase Contract Agreement; provided, that the Forward
Purchase Contract Agent shall not exercise or, as the case may be, shall not
refrain from exercising such right if, in the judgment of the Company (as
expressed to the Forward Purchase Contract Agent in writing), such action would
impair or otherwise have a material adverse effect on the value of all or any of
the Pledged Preferred Stock; and provided, further, that the Forward Purchase
Contract Agent shall, to the extent practicable, give the Company and the
Collateral Agent at least five days' prior written notice of the manner in which
it intends to exercise, or its reasons for refraining from exercising, any such
right. Upon receipt of any notices and other communications in respect of any
Pledged Preferred Stock, including notice of any meeting at which holders of
Preferred Stock are entitled to vote or solicitation of consents, waivers or
proxies of holders of Preferred Stock, the Collateral Agent shall use reasonable
efforts to send promptly to the Forward Purchase Contract Agent such notice or
communication, and as soon as reasonably practicable after receipt of a written
request therefor from the Forward Purchase Contract Agent, execute and deliver
to the Forward Purchase Contract Agent such proxies and other instruments in
respect of such Pledged Preferred Stock (in form and substance satisfactory to
the Collateral Agent) as are prepared by the Forward Purchase Contract Agent
with respect to the Pledged Preferred Stock.
15
ARTICLE VI
Rights and Remedies
Section 6.1 Rights and Remedies of the Collateral Agent. (a) In
addition to the rights and remedies specified in Section 4.4 hereof or otherwise
available at law or in equity, after an event of default hereunder or under the
Forward Purchase Contract Agreement, the Collateral Agent shall have all of the
rights and remedies with respect to the Collateral of a secured party under the
Uniform Commercial Code (or any successor thereto) as in effect in the State of
New York from time to time (the "Code") (whether or not the Code is in effect in
the jurisdiction where the rights and remedies are asserted) and the TRADES
Regulations and such additional rights and remedies to which a secured party is
entitled under the laws in effect in any jurisdiction where any rights and
remedies hereunder may be asserted. Wherever reference is made in this Agreement
to any section of the Code, such reference shall be deemed to include a
reference to any provision of the Code which is a successor to, or amendment of,
such section. Without limiting the generality of the foregoing, such remedies
may include, to the extent permitted by applicable law, (i) retention of the
Pledged Preferred Stock or other Collateral in full satisfaction of the Holders'
obligations under the Forward Purchase Contracts or (ii) sale of the Pledged
Preferred Stock or other Collateral in one or more public or private sales. Each
Holder through the Forward Purchase Contract Agent agrees and acknowledges that
the Collateral is of a type customarily sold in a recognized market and that,
accordingly, no notice of intended disposition of the Collateral need be given
by the Collateral Agent.
(b) Without limiting any rights or powers otherwise granted by
this Agreement to the Collateral Agent, in the event the Collateral
Agent is unable to make payments to the Company, on account of Pledged
Portfolio Interests or on account of principal payments of any Pledged
Treasury Securities as provided in Article III hereof in satisfaction
of the obligations of the Holder of Growth PRIDES of which such Pledged
Treasury Securities or Pledged Portfolio Interests, as applicable, is a
part under the related Forward Purchase Contracts, the inability to
make such payments shall constitute an event of default hereunder and
the Collateral Agent shall have and may exercise, with reference to
such Pledged Treasury Securities or such Pledged Portfolio Interests,
as applicable, and such obligations of such Holder, any and all of the
rights and remedies available to a secured party under the Code and the
TRADES Regulations after default by a debtor, and as otherwise granted
herein or under any other law.
(c) Without limiting any rights or powers otherwise granted by
this Agreement to the Collateral Agent, the Collateral Agent is hereby
irrevocably authorized to receive and collect all payments of (i) the
Liquidation Preference of, or dividend on, the Pledged Preferred Stock,
(ii) the principal amount at maturity of the Pledged Treasury
Securities or (iii) the Pledged Portfolio Interests, subject, in each
case, to the provisions of Article III, and as otherwise granted
herein.
(d) The Forward Purchase Contract Agent, individually and as
attorney-in-fact for each Holder of Securities agrees that, from time
to time, upon the written request of the Company, the Collateral Agent,
the Forward Purchase Contract Agent or such Holder shall execute and
deliver such further documents and do such other acts and things as the
Collateral Agent may reasonably request in order to maintain the
Pledge,
16
and the perfection and priority thereof, and to confirm the
rights of the Collateral Agent hereunder. The Forward Purchase Contract
Agent shall have no liability to any Holder for executing any documents
or taking any such acts requested by the Collateral Agent hereunder,
except for liability for its own negligent act, its own negligent
failure to act, its bad faith or its own willful misconduct.
Section 6.2 Special Event Redemption. Upon the occurrence of a
Special Event Redemption prior to the Forward Purchase Contract Settlement Date,
the aggregate Redemption Price payable on the Special Event Redemption Date with
respect to the Pledged Preferred Stock shall be delivered by the REIT on or
prior to 12:00 p.m., New York City time, by check or wire transfer in
immediately available funds to the Collateral Agent or such other account as may
be designated in writing by the Collateral Agent in exchange for the Pledged
Preferred Stock. In the event the Collateral Agent receives such Redemption
Price, the Collateral Agent will, at the written direction of the REIT or the
Company, apply an amount, out of such Redemption Price, equal to the aggregate
Redemption Amount with respect to the Pledged Preferred Stock to purchase from
the Quotation Agent the Treasury Portfolio and promptly remit any remaining
portion of such Redemption Price to the Forward Purchase Contract Agent for
payment to the Holders of Income PRIDES. The Collateral Agent shall Transfer (or
cause to be Transferred) the Applicable Ownership Interests (as specified in
clause (A) of the definition of such term) in the Portfolio Interests to the
Collateral Account pursuant to the Pledge hereunder, in substitution for the
Pledged Preferred Stock and shall Transfer the Applicable Ownership Interests
(as specified in clause (B) of the definition of such term) of the Portfolio
Interests to the Forward Purchase Contract Agent for the benefit of the holders
of the Income PRIDES. Thereafter, the Collateral Agent shall have such security
interests, rights and obligations with respect to the Treasury Portfolio as it
had in respect of the Pledged Preferred Stock as provided herein, and any
reference herein to the Preferred Stock shall be deemed to be a reference to
such Pledged Portfolio Interests. During any period greater than one Business
Day between the receipt of the Redemption Price in Cash upon the Special Event
Redemption and the payment of all or a portion thereof to the Quotation Agent
for the purchase of the Treasury Portfolio, as provided above, the Collateral
Agent shall (pursuant to the written direction of the Company, which may be in
the form of a standing order) promptly invest any such Cash in Permitted
Investments. Upon receipt of the Proceeds upon the maturity of such Permitted
Investments on the date of the purchase of the Treasury Portfolio as described
above, the Collateral Agent (i) shall pay such Proceeds (and deliver any
certified or cashiers checks received and any funds so wired) in an amount equal
to the purchase price of the Treasury Portfolio to the Quotation Agent and (ii)
shall distribute any funds in respect of the interest earned from the Permitted
Investments to the Forward Purchase Contract Agent for payment to the relevant
Holders.
Section 6.3 Substitutions. Whenever a Holder has the right to
substitute Treasury Securities or Preferred Stock (or Portfolio Interests), as
the case may be, for Collateral held by the Collateral Agent, such substitution
shall not constitute a novation of the security interest created hereby.
17
ARTICLE VII
Representations and Warranties; Covenants
Section 7.1 Representations and Warranties. The Holders from time
to time, acting through the Forward Purchase Contract Agent as their
attorney-in-fact (it being understood that the Forward Purchase Contract Agent
shall not be liable for any representation or warranty made by or on behalf of a
Holder), hereby represent and warrant to the Collateral Agent, which
representations and warranties shall be deemed repeated on each day a Holder
Transfers Collateral that:
(a) such Holder has the power to grant a security interest in
and lien on the Collateral;
(b) such Holder is the sole beneficial owner of the Collateral
and, in the case of Collateral delivered in physical form, is the sole
holder of such Collateral and is the sole beneficial owner of, or has
the right to Transfer, the Collateral it Transfers to the Collateral
Agent, free and clear of any security interest, lien, encumbrance,
judgment, call, liability to pay money or other restriction other than
the security interest and lien granted under Section 2.1 hereof;
(c) upon the Transfer of the Collateral to the Collateral
Account, the Collateral Agent, for the benefit of the Company, will
have a valid and perfected first priority security interest therein
(assuming that any central clearing operation or any Intermediary or
other entity not within the control of the Holder involved in the
Transfer of the Collateral, including the Collateral Agent, gives the
notices and takes the action required of it hereunder and under
applicable law for perfection of that interest and assuming the
establishment and exercise of control pursuant to Section 2.2 hereof);
and
(d) the execution and performance by the Holder of its
obligations under this Agreement will not result in the creation of any
security interest, lien or other encumbrance on the Collateral other
than the security interest and lien granted under Section 2.1 hereof or
violate any provision of any existing law or regulation applicable to
it or of any mortgage, charge, pledge, indenture, contract or
undertaking to which it is a party or which is binding on it or any of
its assets.
Section 7.2 Covenants. The Holders from time to time, acting
through the Forward Purchase Contract Agent as their attorney-in-fact (it being
understood that the Forward Purchase Contract Agent shall not be liable for any
covenant made by or on behalf of a Holder), hereby covenant to the Collateral
Agent that for so long as the Collateral remains subject to the Pledge:
(a) neither the Forward Purchase Contract Agent nor such
Holders will create or purport to create or allow to subsist any
mortgage, charge, lien, pledge or any other security interest
whatsoever over the Collateral or any part of it other than pursuant to
this Agreement;
(b) neither the Forward Purchase Contract Agent nor such
Holders will sell or otherwise dispose (or attempt to dispose) of the
Collateral or any part of it except for the
18
beneficial interest therein, subject to the Pledge hereunder,
transferred in connection with the Transfer of the Securities; and
(c) if any Collateral is delivered to any Holder or to the
Forward Purchase Contract Agent, such Holder or the Forward Purchase
Contract Agent will deliver the same to the Collateral Agent, properly
endorsed when required, and in the form received.
ARTICLE VIII
The Collateral Agent
Section 8.1 Appointment, Powers and Immunities. The Collateral
Agent shall act as Agent for the Company hereunder with such powers as are
specifically vested in the Collateral Agent by the terms of this Agreement,
together with such other powers as are reasonably incidental thereto. Each of
the Collateral Agent, the Custodial Agent and the Securities Intermediary: (a)
shall have no duties or responsibilities except those expressly set forth in
this Agreement and no implied covenants or obligations shall be inferred from
this Agreement against any of them, nor shall any of them be bound by the
provisions of any agreement by any party hereto beyond the specific terms
hereof; (b) shall not be responsible for any recitals contained in this
Agreement, or in any certificate or other document referred to or provided for
in, or received by it under, this Agreement, the Income PRIDES, Growth PRIDES or
the Forward Purchase Contract Agreement, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement
(other than as against the Collateral Agent), the Securities or the Forward
Purchase Contract Agreement or any other document referred to or provided for
herein or therein or for any failure by the Company or any other Person (except
the Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be) to perform any of its obligations hereunder or thereunder or for
the perfection, priority or, except as expressly required hereby, maintenance of
any security interest created hereunder; (c) shall not be required to initiate
or conduct any litigation or collection proceedings hereunder (except in the
case of the Collateral Agent, pursuant to directions furnished under Section 8.2
hereof, subject to Section 8.6 hereof); (d) shall not be responsible for any
action taken or omitted to be taken by it hereunder or under any other document
or instrument referred to or provided for herein or in connection herewith or
therewith, except for its own negligence, bad faith or willful misconduct; and
(e) shall not be required to advise any party as to selling or retaining, or
taking or refraining from taking any action with respect to, the Securities or
other property deposited hereunder. Subject to the foregoing, during the term of
this Agreement, the Collateral Agent shall take all reasonable action in
connection with the safekeeping and preservation of the Collateral hereunder.
No provision of this Agreement shall require the Collateral Agent, the
Custodial Agent or the Securities Intermediary to expend or risk its own funds
or otherwise incur any financial liability in the performance of any of its
duties hereunder. In no event shall the Collateral Agent, the Custodial Agent or
the Securities Intermediary be liable for any amount in excess of the Value of
the Collateral. Notwithstanding the foregoing, the Collateral Agent, the
Custodial Agent, the Forward Purchase Contract Agent and Securities
Intermediary, each in its individual capacity, hereby waive any right of setoff,
bankers lien, liens or perfection rights as securities intermediary or any
counterclaim with respect to any of the Collateral.
19
Section 8.2 Instructions of the Company. The Company shall have
the right, by one or more instruments in writing executed and delivered to the
Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be, to direct the time, method and place of conducting any proceeding
for the realization of any right or remedy available to the Collateral Agent, or
of exercising any power conferred on the Collateral Agent, the Custodial Agent
or the Securities Intermediary, as the case may be, or to direct the taking or
refraining from taking of any action authorized by this Agreement; provided,
however, that (i) such direction shall not conflict with the provisions of any
law or of this Agreement and (ii) the Collateral Agent, the Custodial Agent and
the Securities Intermediary shall be adequately indemnified as provided herein.
Nothing in this Section 8.2 shall impair the right of the Collateral Agent in
its discretion to take any action or omit to take any action which it deems
proper and which is not inconsistent with such direction.
The Collateral Agent, Custodial Agent and Securities Intermediary 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 Collateral
Agent, Custodial Agent and Securities Intermediary.
Section 8.3 Reliance by Collateral Agent. Each of the Securities
Intermediary, the Custodial Agent and the Collateral Agent shall be entitled
conclusively to rely upon any certification, order, judgment, opinion, notice or
other communication (including, without limitation, any thereof by telephone or
facsimile) believed by it in good faith to be genuine and correct and to have
been signed or sent by or on behalf of the proper Person or Persons (without
being required to determine the correctness of any fact stated therein), and
upon advice and statements of legal counsel and other experts selected by the
Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be. As to any matters not expressly provided for by this Agreement, the
Collateral Agent, the Custodial Agent and the Securities Intermediary shall in
all cases be fully protected in acting, or in refraining from acting, hereunder
in accordance with instructions given by the Company in accordance with this
Agreement.
Section 8.4 Rights in Other Capacities. The Collateral Agent, the
Custodial Agent and the Securities Intermediary and their affiliates may
(without having to account therefor to the Company) accept deposits from, lend
money to, make their investments in and generally engage in any kind of banking,
trust or other business with the Forward Purchase Contract Agent, any Holder of
Income PRIDES or Growth PRIDES and any holder of Separate Preferred Stock (and
any of their respective subsidiaries or affiliates) as if it were not acting as
the Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be, and the Collateral Agent, the Custodial Agent and the Securities
Intermediary and their affiliates may accept fees and other consideration from
the Forward Purchase Contract Agent, any Holder of Income PRIDES or Growth
PRIDES or any holder of Separate Preferred Stock without having to account for
the same to the Company; provided that each of the Securities Intermediary, the
Custodial Agent and the Collateral Agent covenants and agrees with the Company
that it shall not accept, receive or permit there to be created in favor of
itself and shall take no affirmative action to permit there to be created in
favor of any other Person, any security interest, lien or other encumbrance of
any kind in or upon the Collateral and the Collateral shall not be commingled
with any other assets of any such Person.
20
Section 8.5 Non-Reliance on Collateral Agent. None of the
Securities Intermediary, the Custodial Agent or the Collateral Agent shall be
required to keep itself informed as to the performance or observance by the
Forward Purchase Contract Agent or any Holder of Securities of this Agreement,
the Forward Purchase Contract Agreement, the Income PRIDES or Growth PRIDES or
any other document referred to or provided for herein or therein or to inspect
the properties or books of the Forward Purchase Contract Agent or any Holder of
Income PRIDES or Growth PRIDES. The Collateral Agent, the Custodial Agent and
the Securities Intermediary shall not have any duty or responsibility to provide
the Company or the Remarketing Agent with any credit or other information
concerning the affairs, financial condition or business of the Forward Purchase
Contract Agent, any Holder of Income PRIDES or Growth PRIDES or any holder of
Separate Preferred Stock (or any of their respective subsidiaries or affiliates)
that may come into the possession of the Collateral Agent, the Custodial Agent
or the Securities Intermediary or any of their respective affiliates.
Section 8.6 Compensation and Indemnity. The Company agrees: (i)
to pay each of the Collateral Agent and the Custodial Agent from time to time
such compensation as shall be agreed in writing between the Company and the
Collateral Agent or the Custodial Agent, as the case may be, for all services
rendered by each of them hereunder and (ii) to indemnify the Collateral Agent,
the Custodial Agent and the Securities Intermediary for, and to hold each of
them harmless from and against, any loss, liability or reasonable out-of-pocket
expense incurred without negligence, willful misconduct or bad faith on its
part, arising out of or in connection with the acceptance or administration of
its powers and duties under this Agreement, including the reasonable
out-of-pocket costs and expenses (including reasonable fees and
expenses of counsel) of defending itself against any claim or liability in
connection with the exercise or performance of such powers and duties. The
Collateral Agent, the Custodial Agent and the Securities Intermediary shall each
promptly notify the Company of any third party claim which may give rise to the
indemnity hereunder and give the Company the opportunity to participate in the
defense of such claim with counsel reasonably satisfactory to the indemnified
party, and no such claim shall be settled without the written consent of the
Company, which consent shall not be unreasonably withheld.
Section 8.7 Failure to Act. In the event of any ambiguity in the
provisions of this Agreement or any dispute between or conflicting claims by or
among the parties hereto or any other Person with respect to any funds or
property deposited hereunder, the Collateral Agent and the Custodial Agent shall
be entitled, after prompt notice to the Company and the Forward Purchase
Contract Agent, at its sole option, to refuse to comply with any and all claims,
demands or instructions with respect to such property or funds so long as such
dispute or conflict shall continue, and neither the Collateral Agent nor the
Custodial Agent shall be or become liable in any way to any of the parties
hereto for its failure or refusal to comply with such conflicting claims,
demands or instructions. The Collateral Agent and the Custodial Agent shall be
entitled to refuse to act until either (i) such conflicting or adverse claims or
demands shall have been finally determined by a court of competent jurisdiction
or settled by agreement between the conflicting parties as evidenced in a
writing, satisfactory to the Collateral Agent or the Custodial Agent, as the
case may be, or (ii) the Collateral Agent or the Custodial Agent, as the case
may be, shall have received security or an indemnity reasonably satisfactory to
the Collateral Agent or the Custodial Agent, as the case may be, sufficient to
save the Collateral Agent or the Custodial Agent, as the case may be, harmless
from and against any and all loss, liability or
21
reasonable out-of-pocket expense which the Collateral Agent or the Custodial
Agent, as the case may be, may incur by reason of its acting without bad faith,
willful misconduct or gross negligence. The Collateral Agent or the Custodial
Agent may in addition elect to commence an interpleader action or seek other
judicial relief or orders as the Collateral Agent or the Custodial Agent, as the
case may be, may deem necessary. Notwithstanding anything contained herein to
the contrary, neither the Collateral Agent nor the Custodial Agent shall be
required to take any action that is in its opinion contrary to law or to the
terms of this Agreement, or which would in its opinion subject it or any of its
officers, employees or directors to liability.
Section 8.8 Resignation of Collateral Agent. Subject to the
appointment and acceptance of a successor Collateral Agent or Custodial Agent as
provided below, (a) the Collateral Agent and the Custodial Agent may resign at
any time by giving not less than 20 days prior notice thereof to the Company and
the Forward Purchase Contract Agent as attorney-in-fact for the Holders of
Income PRIDES or Growth PRIDES, (b) the Collateral Agent and the Custodial Agent
may be removed at any time by the Company and (c) if the Collateral Agent or the
Custodial Agent fails to perform any of its material obligations hereunder in
any material respect for a period of not less than 20 days after receiving
written notice of such failure by the Forward Purchase Contract Agent and such
failure shall be continuing, the Collateral Agent or the Custodial Agent may be
removed by the Forward Purchase Contract Agent. The Forward Purchase Contract
Agent shall promptly notify the Company of any removal of the Collateral Agent
pursuant to clause (c) of the immediately preceding sentence. Upon any such
resignation or removal, the Company shall have the right to appoint a successor
Collateral Agent or Custodial Agent, as the case may be. If no successor
Collateral Agent or Custodial Agent, as the case may be, shall have been so
appointed and shall have accepted such appointment within 30 days after the
retiring Collateral Agent's or Custodial Agent's giving of notice of resignation
or such removal, then the retiring Collateral Agent or Custodial Agent, as the
case may be, may, at the expense of the Company, petition any court of competent
jurisdiction for the appointment of a successor Collateral Agent or Custodial
Agent, as the case may be. Each of the Collateral Agent and the Custodial Agent
shall be a bank which has an office in New York, New York with a combined
capital and surplus of at least $75,000,000. Upon the acceptance of any
appointment as Collateral Agent or Custodial Agent, as the case may be,
hereunder by a successor Collateral Agent or Custodial Agent, as the case may
be, such successor shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring Collateral Agent or
Custodial Agent, as the case may be, and the retiring Collateral Agent or
Custodial Agent, as the case may be, shall take all appropriate action to
transfer any money and property held by it hereunder (including the Collateral)
to such successor. The retiring Collateral Agent or Custodial Agent shall, upon
such succession, be discharged from its duties and obligations as Collateral
Agent or Custodial Agent hereunder. After any retiring Collateral Agent's or
Custodial Agent's resignation hereunder as Collateral Agent or Custodial Agent,
the provisions of this Article VIII shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting as
the Collateral Agent or Custodial Agent. Any resignation or removal of the
Collateral Agent hereunder shall be deemed for all purposes of this Agreement as
the simultaneous resignation or removal of the Custodial Agent and the
Securities Intermediary.
Section 8.9 Right to Appoint Agent or Advisor. The Collateral
Agent shall have the right to appoint agents or advisors in connection with any
of its duties hereunder, and the
22
Collateral Agent shall not be liable for any action taken or omitted by, or in
reliance upon the advice of, such agents or advisors selected in good faith. The
appointment of agents pursuant to this Section 8.9 shall be subject to prior
consent of the Company, which consent shall not be unreasonably withheld.
Section 8.10 Survival. The provisions of this Article VIII shall
survive termination of this Agreement and the resignation or removal of the
Collateral Agent or the Custodial Agent.
Section 8.11 Exculpation. Anything in this Agreement to the
contrary notwithstanding, in no event shall any of the Collateral Agent, the
Custodial Agent or the Securities Intermediary or their officers, employees or
agents be liable under this Agreement to any third party for indirect, special,
punitive, or consequential loss or damage of any kind whatsoever, including lost
profits, whether or not the likelihood of such loss or damage was known to the
Collateral Agent, the Custodial Agent or the Securities Intermediary, or any of
them, incurred without any act or deed that is found to be attributable to gross
negligence, bad faith or willful misconduct on the part of the Collateral Agent,
the Custodial Agent or the Securities Intermediary.
ARTICLE IX
Amendment
Section 9.1 Amendment without Consent of Holders. Without the
consent of any Holders or the holders of any Separate Preferred Stock, the
Company, the Collateral Agent, the Custodial Agent, the Securities Intermediary
and the Forward Purchase Contract Agent, at any time and from time to time, may
amend this Agreement, in form satisfactory to the Company, the Collateral Agent,
the Custodial Agent, the Securities Intermediary and the Forward Purchase
Contract Agent, for any of the following purposes:
(i) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of
the Company; or
(ii) to add to the covenants of the Company for the benefit of
the Holders, or to surrender any right or power herein conferred upon
the Company so long as such covenants or such surrender do not
adversely affect the validity, perfection or priority of the security
interests granted or created hereunder; or
(iii) to evidence and provide for the acceptance of
appointment hereunder by a successor Collateral Agent, Custodial Agent,
Securities Intermediary or Forward Purchase Contract Agent; or
(iv) to cure any ambiguity, to correct or supplement any
provisions herein which may be inconsistent with any other such
provisions herein, or to make any other provisions with respect to such
matters or questions arising under this Agreement, provided such action
shall not adversely affect the interests of the Holders in any material
respect.
23
Section 9.2 Amendment with Consent of Holders. With the consent
of the Holders of not less than a majority of the Forward Purchase Contracts at
the time outstanding, by Act of said Holders delivered to the Company, the
Forward Purchase Contract Agent or the Collateral Agent, as the case may be, the
Company, when duly authorized, the Company, the Forward Purchase Contract Agent,
the Collateral Agent, the Custodial Agent and the Securities Intermediary may
amend this Agreement for the purpose of modifying in any manner the provisions
of this Agreement or the rights of the Holders in respect of the Income PRIDES
and Growth PRIDES; provided, however, that no such supplemental agreement shall,
without the consent of the Holder of each Outstanding Income PRIDES and Growth
PRIDES adversely affected thereby,
(i) change the amount or type of Collateral underlying an
Income PRIDES or Growth PRIDES (except for the rights of holders of
Income PRIDES to substitute the Treasury Securities for the Pledged
Preferred Stock (or Pledged Portfolio Interests), or the rights of
Holders of Growth PRIDES to substitute Preferred Stock (or the
Applicable Ownership Interests (as specified in clause (A) of the
definition of such term) in the Portfolio Interests, as applicable) for
the Pledged Treasury Securities), impair the right of the Holder of any
Income PRIDES or Growth PRIDES to receive distributions on the
underlying Collateral or otherwise adversely affect the Holder's rights
in or to such Collateral; or
(ii) otherwise effect any action that would require the
consent of the Holder of each Outstanding Income PRIDES or Growth
PRIDES affected thereby pursuant to the Forward Purchase Contract
Agreement if such action were effected by an agreement supplemental
thereto; or
(iii) reduce the percentage of Forward Purchase Contracts the
consent of whose Holders is required for any such amendment
provided that if any amendment or proposal referred to above would adversely
affect only the Income PRIDES or the Growth PRIDES, then only the affected class
of Holders as of the record date for the Holders entitled to vote thereon will
be entitled to vote on such amendment or proposal, and such amendment or
proposal shall not be effective except with the consent of Holders of not less
than a majority of such class; and provided, further, that the unanimous consent
of the Holders of each outstanding Forward Purchase Contract of such class
affected thereby shall be required to approve any amendment or proposal
specified in clauses (i) through (iii) above.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed amendment, but it shall be
sufficient if such Act shall approve the substance thereof.
Notwithstanding anything to contrary contained herein, Sections 4.4(b)
and 4.6(a) may not be amended without prior approval of the Board of Governors
of the Federal Reserve System.
Section 9.3 Execution of Amendments. In executing any amendment
permitted by this Article IX, the Collateral Agent, the Custodial Agent, the
Securities Intermediary and the
24
Forward Purchase Contract Agent shall be entitled to receive and (subject to
Section 6.1 hereof, with respect to the Collateral Agent, and Section 8.1 of the
Forward Purchase Contract Agreement, with respect to the Forward Purchase
Contract Agent) shall be fully protected in relying upon, an Opinion of Counsel
stating that the execution of such amendment is authorized or permitted by this
Agreement and that all conditions precedent, if any, to the execution and
delivery of such amendment have been satisfied.
Section 9.4 Effect of Amendments. Upon the execution of any
amendment under this Article 9, this Agreement shall be modified in accordance
therewith, and such amendment shall form a part of this Agreement for all
purposes; and every Holder of Certificates theretofore or thereafter
authenticated, executed on behalf of the Holders and delivered under the Forward
Purchase Contract Agreement shall be bound thereby.
Section 9.5 Reference to Amendments. Security Certificates
authenticated, executed on behalf of the Holders and delivered after the
execution of any amendment pursuant to this Section may, and shall if required
by the Collateral Agent or the Forward Purchase Contract Agent, bear a notation
in form approved by the Forward Purchase Contract Agent and the Collateral Agent
as to any matter provided for in such amendment. If the Company shall so
determine, new Security Certificates so modified as to conform, in the opinion
of the Collateral Agent, the Forward Purchase Contract Agent and the Company, to
any such amendment may be prepared and executed by the Company and
authenticated, executed on behalf of the Holders and delivered by the Forward
Purchase Contract Agent in accordance with the Forward Purchase Contract
Agreement in exchange for Outstanding Security Certificates.
ARTICLE X
Miscellaneous
Section 10.1 No Waiver. No failure on the part of any party hereto
or any of its agents to exercise, and no course of dealing with respect to, and
no delay in exercising, any right, power or remedy hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise by any party hereto or
any of its agents of any right, power or remedy hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or remedy.
The remedies herein are cumulative and are not exclusive of any remedies
provided by law.
Section 10.2 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. Without
limiting the foregoing, the above choice of law is expressly agreed to by the
Securities Intermediary, the Collateral Agent and the Holders from time to time
acting through the Forward Purchase Contract Agent, as their attorney-in-fact,
in connection with the establishment and maintenance of the Collateral Account.
Section 10.3 Notices. All notices, requests, consents and other
communications provided for herein (including, without limitation, any
modifications of, or waivers or consents under, this Agreement) shall be given
or made in writing (including, without limitation, by telecopy) delivered to the
intended recipient at the "Address for Notices" specified below its name on the
signature pages hereof or, as to any party, at such other address as shall be
designated by such party in a notice to the other parties. Except as otherwise
provided in this
25
Agreement, all such communications shall be deemed to have been duly given when
transmitted by telecopier or personally delivered or, in the case of a mailed
notice, upon receipt, in each case given or addressed as aforesaid.
Section 10.4 Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the respective successors and assigns
of the Company, the Collateral Agent, the Custodial Agent, the Securities
Intermediary and the Forward Purchase Contract Agent, and the Holders from time
to time of the Income PRIDES and Growth PRIDES, by their acceptance of the same,
shall be deemed to have agreed to be bound by the provisions hereof and to have
ratified the agreements of, and the grant of the Pledge hereunder by, the
Forward Purchase Contract Agent.
Section 10.5 Counterparts. This Agreement may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument, and any of the parties hereto may execute this Agreement by
signing any such counterpart.
Section 10.6 Severability. If any provision hereof is invalid and
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(i) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in order to carry out the
intentions of the parties hereto as nearly as may be possible and (ii) the
invalidity or unenforceability of any provision hereof in any jurisdiction shall
not affect the validity or enforceability of such provision in any other
jurisdiction.
Section 10.7 Expenses, Etc. The Company agrees to reimburse the
Collateral Agent, the Custodial Agent and the Securities Intermediary for: (a)
all reasonable out-of-pocket costs and expenses of the Collateral Agent, the
Custodial Agent and the Securities Intermediary (including, without limitation,
the reasonable fees and expenses of counsel for the Collateral Agent, the
Custodial Agent and the Securities Intermediary), in connection with (i) the
negotiation, preparation, execution and delivery or performance of this
Agreement and (ii) any modification, supplement or waiver of any of the terms of
this Agreement; (b) all reasonable costs and expenses of the Collateral Agent
(including, without limitation, reasonable fees and expenses of counsel) in
connection with (i) any enforcement or proceedings resulting or incurred in
connection with causing any Holder of Securities to satisfy its obligations
under the Forward Purchase Contracts forming a part of the Securities and (ii)
the enforcement of this Section 10.7; and (c) all transfer, stamp, documentary
or other similar taxes, assessments or charges levied by any governmental or
revenue authority in respect of this Agreement or any other document referred to
herein and all costs, expenses, taxes, assessments and other charges incurred in
connection with any filing, registration, recording or perfection of any
security interest contemplated hereby.
Section 10.8 Security Interest Absolute. All rights of the
Collateral Agent and security interests hereunder, and all obligations of the
Holders from time to time hereunder, shall be absolute and unconditional
irrespective of:
(a) any lack of validity or enforceability of any provision of
the Forward Purchase Contracts or the Securities or any other agreement
or instrument relating thereto;
26
(b) any change in the time, manner or place of payment of, or
any other term of, or any increase in the amount of, all or any of the
obligations of Holders of Securities under the related Forward Purchase
Contracts, or any other amendment or waiver of any term of, or any
consent to any departure from any requirement of, the Forward Purchase
Contract Agreement or any Forward Purchase Contract or any other
agreement or instrument relating thereto; or
(c) any other circumstance which might otherwise constitute a
defense available to, or discharge of, a borrower, a guarantor or a
pledgor.
Section 10.9 Consent to Jurisdiction; Miscellaneous. Each of the
parties hereto hereby expressly and irrevocably submits to the non-exclusive
jurisdiction of any competent court in the place of its domicile and any United
States Federal or New York State court sitting in the Borough of Manhattan in
The City of New York in any action, suit or proceeding arising out of or
relating to this Underwriting Agreement or the transactions contemplated hereby
to the extent that such court has subject matter jurisdiction over the
controversy, and expressly and irrevocably waives, to the extent permitted under
applicable law, any immunity from the jurisdiction thereof and any claim or
defense in such action, suit or proceeding based on a claim of improper venue,
forum non conveniens or any similar basis to which it might otherwise be
entitled in any such action, suit or proceeding.
27
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
PROVIDENT FINANCIAL GROUP, INC.
By: ___________________________________________
Name:
Title:
Address for Notices:
Provident Financial Group, Inc.
Xxx Xxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxx 00000
Attention: General Counsel
Telecopy: 000-000-0000
X. X. XXXXXX TRUST COMPANY, NATIONAL ASSOCIATION,
as Forward Purchase Contract Agent, Collateral
Agent, Custodial Agent, Securities Intermediary and
as attorney-in-fact of the Holders from time to
time of the Income PRIDES and Growth PRIDES
By: ___________________________________
Name:
Title:
Address for Notices:
X. X. Xxxxxx Trust Company, National Association
Chase Financial Tower
Suite 220
000 X. Xxxxx Xxxx
Xxxxxxxxx, Xxxx 00000
Attention: Institutional Trust Services
Telecopy: 000-000-0000
28
EXHIBIT A
INSTRUCTION FROM FORWARD PURCHASE CONTRACT
AGENT TO COLLATERAL AGENT
X. X. Xxxxxx Trust Company, National Association, as Collateral Agent
Chase Financial Tower
Suite 220
000 X. Xxxxx Xxxx
Xxxxxxxxx, Xxxx 00000
Attention: Institutional Trust Services
Telecopy: 000-000-0000
Re: PRIDES of Provident Financial Group, Inc. (the "Company")
and PFGI Capital Corporation
We hereby notify you in accordance with Section [4.1] [4.2] of the
Pledge Agreement, dated as of June 12, 2002 (the "Pledge Agreement") among the
Company, yourselves, as Collateral Agent, Custodial Agent and Securities
Intermediary and ourselves, as Forward Purchase Contract Agent and as
attorney-in-fact for the holders of [Income PRIDES] [Growth PRIDES] from time to
time, that the holder of the Securities listed below (the "Holder") has elected
to substitute [$_____ aggregate principal amount at maturity of Treasury
Securities] [$_______ Liquidation Preference of Preferred Stock] [$_______
aggregate principal amount of Portfolio Interests] in exchange for an equal
Value of [Pledged Preferred Stock] [Pledged Portfolio Interests], [Pledged
Treasury Securities] held by you in accordance with the Pledge Agreement and has
delivered to us a notice stating that the Holder has Transferred [Treasury
Securities] [Preferred Stock] [Portfolio Interests] to you, as Collateral Agent.
We hereby instruct you, upon receipt of such [Pledged Treasury Securities]
[Pledged Preferred Stock] [Pledged Portfolio Interests], and upon the payment by
such Holder of any applicable fees, to release the [Preferred Stock or Portfolio
Interests] [Treasury Securities] related to such [Income PRIDES] [Growth PRIDES]
to us in accordance with the Holder's instructions. Capitalized terms used
herein but not defined shall have the meaning set forth in the Pledge Agreement.
Date: __________________ X.X. XXXXXX TRUST COMPANY, NATIONAL ASSOCIATION, as
Forward Purchase Contract Agent
By:________________________________
Name:
Title:
Signature Guarantee:
A-1
Please print name and address of Registered Holder electing to substitute
[Treasury Securities] [Preferred Stock] [Portfolio Interests] for the [Pledged
Preferred Stock] [Pledged Portfolio Interests] [Pledged Treasury Securities]:
-------------------------------- ----------------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
--------------------------------
Address
--------------------------------
--------------------------------
A-2
EXHIBIT B
INSTRUCTION TO FORWARD PURCHASE CONTRACT AGENT
X. X. Xxxxxx Trust Company, National Association,
as Forward Purchase Contract Agent
Chase Financial Tower
Suite 220
000 X. Xxxxx Xxxx
Xxxxxxxxx, Xxxx 00000
Attention: Institutional Trust Services
Telecopy: 000-000-0000
Re: PRIDES of Provident Financial Group, Inc. (the "Company") and
PFGI Capital Corporation
The undersigned Holder hereby notifies you that it has delivered to X.
X. Xxxxxx Trust Company, National Association, as Collateral Agent, [$_______
aggregate principal amount at maturity of Treasury Securities] [$________
aggregate Liquidation Preference of Preferred Stock] [$_______ aggregate
principal amount of Portfolio Interests] in exchange for an equal Value of
[Pledged Preferred Stock] [Pledged Portfolio Interests] [Pledged Treasury
Securities] held by the Collateral Agent, in accordance with Section [4.1][4.2]
of the Pledge Agreement, dated June 12, 2002 (the "Pledge Agreement"), between
you, as Forward Purchase Contract Agent and Collateral Agent, and the Company.
The undersigned Holder has paid the Collateral Agent all applicable fees and
expenses relating to such exchange. The undersigned Holder hereby instructs you
as Forward Purchase Contract Agent to instruct the Collateral Agent to release
to you on behalf of the undersigned Holder the [Pledged Preferred Stock]
[Pledged Portfolio Interests] [Pledged Treasury Securities] related to such
[Income PRIDES] [Growth PRIDES]. Capitalized terms used herein but not defined
shall have the meaning set forth in the Pledge Agreement.
Date: _____________________________ ______________________________
Signature Guarantee:___________________
Please print name and address of Registered Holder:
---------------------------------- ------------------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
----------------------------------
Address
----------------------------------
----------------------------------
B-1
