EX-99.7 9 accelsharerep.htm ACCELERATED SHARE REPURCHASE AGREEMENT November 7, 2007 Nu Skin Enterprises, Inc. 75 West Center Street Provo, UT 84601 Ladies and Gentlemen: The purpose of this letter agreement (this “Confirmation”) is to confirm the...
November 7, 2007
Nu Skin Enterprises, Inc. 00 Xxxx Xxxxxx Xxxxxx Xxxxx, XX 00000
Ladies and Gentlemen:
The purpose of this letter agreement (this “Confirmation”) is to confirm the terms and conditions of the Transaction entered into between X.X. Xxxxxx Securities Inc., as agent for JPMorgan Chase Bank, National Association, London Branch (the “Seller”), and Nu Skin Enterprises, Inc., a Delaware corporation (the “Purchaser”), on the Trade Date specified below (the “Transaction”). This Confirmation constitutes a “Confirmation” as referred to in the Agreement specified below. In the event of a conflict between the Agreement (as defined below) and this Confirmation, the terms of this Confirmation shall govern.
This Confirmation evidences a complete and binding agreement between the Seller and the Purchaser as to the terms of the Transaction to which this Confirmation relates. This Confirmation shall supplement, form a part of, and be subject to an agreement in the form of the 2002 ISDA Master Agreement (the “Agreement”) as if the Seller and the Purchaser had executed an agreement in such form (but without any Schedule except for the election of the laws of the State of New York as the governing law) on the Trade Date. In the event of any inconsistency between provisions of that Agreement and this Confirmation, this Confirmation will prevail for the purpose of the Transaction to which this Confirmation relates. The parties hereby agree that no Transaction other than the Transaction to which this Confirmation relates shall be governed by the Agreement.
ARTICLE 1
“10b-18 VWAP” means, (A) for any Trading Day described in clause (x) of the definition of Trading Day hereunder, the volume-weighted average price at which the Common Stock trades as reported in the composite transactions for the principal United States securities exchange on which such Common Stock is then listed (or, if applicable, the Successor Exchange on which the Common Stock has been listed in accordance with Section 7.01(c)), on such Trading Day, excluding (i) trades that do not settle regular way, (ii) opening (regular way) reported trades in the consolidated system on such Trading Day, (iii) trades that occur in the last ten minutes before the scheduled close of trading on the Exchange on such Trading Day and ten minutes before the scheduled close of the primary trading in the market where the trade is effected, and (iv) trades on such Trading Day that do not satisfy the requirements of Rule 10b-18(b)(3), as determined in good faith by the Calculation Agent, or (B) for any Trading Day that is described in clause (y) of the definition of Trading Day hereunder, an amount determined in good faith by the Calculation Agent as 10b-18 VWAP. The Purchaser acknowledges that the Seller may refer to the Bloomberg Page “NUS.N <Equity> AQR SEC” (or any successor thereto), in its judgment, for such Trading Day to determine the 10b-18 VWAP.
“Additional Termination Event” has the meaning set forth in Section 7.01.
“Agreement” has the meaning set forth in the second paragraph of this Confirmation.
“Affected Party” has the meaning set forth in Section 14 of the Agreement.
“Affected Transaction” has the meaning set forth in Section 14 of the Agreement.
“Affiliated Purchaser” means any “affiliated purchaser” (as such term is defined in Rule 10b-18) of the Purchaser.
“Alternative Termination Delivery Unit” means (i) in the case of a Termination Event (other than a Merger Event or Nationalization) or Event of Default (as defined in the Agreement), one share of Common Stock and (ii) in the case of a Merger Event or Nationalization, a unit consisting of the number or amount of each type of property received by a holder of one share of Common Stock in such Merger Event or Nationalization; provided that if such Merger Event involves a choice of consideration to be received by holders of the Common Stock, an Alternative Termination Delivery Unit shall be deemed to include the amount of cash received by a holder who had elected to receive the maximum possible amount of cash as consideration for his shares.
“Averaging Period” means the period of consecutive Trading Days from and including the first Trading Day following the Hedging Completion Date to and including the Valuation Completion Date.
“Bankruptcy Code” has the meaning set forth in Section 9.07.
“Business Day” means any day on which the Exchange is open for trading.
“Calculation Agent” means JPMorgan Chase Bank, National Association.
“Common Stock” has the meaning set forth in Section 2.01.
“Communications Procedures” has the meaning set forth in Annex A hereto.
“Confirmation” has the meaning set forth in the first paragraph of this letter agreement.
“Contract Fee” means the amount specified as such in the Pricing Supplement.
“Contract Period” means the period commencing on and including the Trade Date and ending on and including the date all payments or deliveries of shares of Common Stock pursuant to Article 3 or Section 7.03 have been made.
“Default Notice Day” has the meaning set forth in Section 7.02(a).
“De-Listing” has the meaning set forth in Section 7.01(c).
“Discount” means the amount specified as such in the Pricing Supplement.
“Early Termination Date” has the meaning set forth in Section 14 of the Agreement.
“Event of Default” has the meaning set forth in Section 14 of the Agreement.
“Exchange” means the New York Stock Exchange.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Expiration Date” means the 61st Trading Day following the Hedging Completion Date.
“Extraordinary Cash Dividend” means the per share cash dividend or distribution, or a portion thereof, declared by the Purchaser on shares of Common Stock that is classified by the board of directors of the Purchaser as an “extraordinary” dividend.
“Hedging Completion Date” means the Trading Day on which the Seller completes the establishment of its initial hedge position with respect to this Transaction.
“Hedging Price” means the volume weighted average of the per share prices at which the Seller (or an affiliate of the Seller) purchases shares of Common Stock during the Hedging Period to establish Seller’s initial hedge position with respect to this Transaction.
“Hedging Period” has the meaning set forth in Section 2.04(a).
“Hedging Threshold Price” means the price per share equal to the quotient of (A) the Purchase Price divided by (B) the product of the percentage contained in the definition of the Upside Threshold and the Initial Number of Shares.
“Indemnified Person” has the meaning set forth in Section 9.02.
“Indemnifying Party” has the meaning set forth in Section 9.02.
“Initial Number of Shares” means the number of shares of Common Stock specified as such in the Pricing Supplement.
“Initial Settlement Date” means the first Business Day immediately following the Trade Date.
“Merger Event” has the meaning set forth in Section 7.01(d).
“Minimum Delivery Number” means the number of shares of Common Stock, rounded down to the nearest integer, equal to (A) the Purchase Price divided by (B) the Upside Threshold.
“Nationalization” has the meaning set forth in Section 7.01(e).
“Obligations” has the meaning set forth in Section 9.02.
“Ordinary Cash Dividend” has the meaning set forth in Section 8.01(b).
“Pricing Supplement” means the Pricing Supplement attached hereto as Annex B.
“Purchase Price” has the meaning set forth in Section 2.01.
“Purchaser” has the meaning set forth in the first paragraph of this Confirmation.
“Regulation M” means Regulation M under the Exchange Act.
“Rule 10b-18” means Rule 10b-18 promulgated under the Exchange Act (or any successor rule thereto).
“SEC” means the Securities and Exchange Commission.
“Securities Act” means the Securities Act of 1933, as amended.
“Seller” has the meaning set forth in the first paragraph hereto.
“Seller Termination Share Purchase Period” has the meaning set forth in Section 7.03.
“Settlement Number” means the number of shares of Common Stock equal to (i) the Valuation Number minus (ii) the Minimum Delivery Number.
“Share Cap” means, for any date, (i) 200,000,000 shares of Common Stock, minus (ii) the net number of shares of Common Stock delivered by the Purchaser to the Seller in respect of this Transaction on or prior to such date, plus (iii) the net number of shares of Common Stock delivered by the Seller to the Purchaser in respect of this Transaction on or prior to such date, subject to appropriate adjustments pursuant to Section 8.02.
“Share De-listing Event” has the meaning set forth in Section 7.01(c).
“Successor Exchange” has the meaning set forth in Section 7.01(c).
“Termination Amount” has the meaning set forth in Section 7.02(a).
“Termination Event” has the meaning set forth in Section 14 of the Agreement.
“Termination Price” means the value of an Alternative Termination Delivery Unit to the Seller, as determined by the Calculation Agent.
“Trade Date” has the meaning set forth in Section 2.01.
“Trading Day” means (x) any day (i) other than a Saturday, a Sunday or a day on which the Exchange is not open for business, (ii) during which trading of any securities of the Purchaser on any national securities exchange has not been suspended, (iii) during which there has not been, in the Seller’s judgment, a material limitation in the trading of Common Stock or any options contract or futures contract related to the Common Stock, and (iv) during which there has been no suspension pursuant to Section 4.02 of this Confirmation, or (y) any day that, notwithstanding the occurrence of events contemplated in clauses (ii), (iii) and (iv) of this definition, the Calculation Agent determines to be a Trading Day.
“Transaction” has the meaning set forth in the first paragraph of this Confirmation.
“Upside Threshold” has the meaning specified as such in the Pricing Supplement.
“Valuation Completion Date” has the meaning specified as such in the Pricing Supplement.
“Valuation Number” means the number of shares of Common Stock, rounded down to the nearest integer, equal to the Purchase Price divided by the Valuation Price; provided, however, that if such number of shares of Common Stock is less than the Minimum Delivery Number, the Valuation Number shall be equal to the Minimum Delivery Number.
“Valuation Price” means the average of the 10b-18 VWAPs for all Trading Days in the Averaging Period minus the Discount.
ARTICLE 2
(b) At the conclusion of the Hedging Period, based on the amounts and prices at which an affiliate of the Seller effects purchases of shares of Common Stock during the Hedging Period to establish Seller’s initial hedge position in connection with this Transaction, the Calculation Agent shall determine the Hedging Price, the Upside Threshold and the Minimum Delivery Number for this Transaction; provided that if, at any time during the Hedging Period, the weighted average price at which the Seller, or an affiliate of the Seller, has until such time purchased shares of Common Stock in connection with establishing its initial hedge position with respect to this Transaction equals to or exceeds the Hedging Threshold Price, (i) the Seller shall have the right to terminate the Hedging Period as of such time and (ii) the Calculation Agent may make adjustments to the Upside Threshold and any other variable or term relevant to the terms of the Transaction and, for the purposes of calculating the Settlement Number pursuant to Article 3 hereof, shall adjust the Purchase Price for this Transaction, to preserve the fair value of this Transaction to the Seller and ensure that the Seller’s, or its affiliate’s, initial theoretical delta for this Transaction is equal to the number of shares of Common Stock purchased by the Seller or an affiliate of the Seller during the Hedging Period at the time of such termination.
(c) On the first Business Day following the Hedging Completion Date, in addition to satisfying its obligations under Section 3.01(a), the Seller shall deliver to the Purchaser a hedging completion notice, substantially in the form of Exhibit A attached hereto, setting forth the Hedging Price, the Upside Threshold, the Minimum Delivery Number and the first day of the Averaging Period for this Transaction.
ARTICLE 3
(b) On the third Business Day immediately following the Valuation Completion Date, the Seller shall deliver to the Purchaser the Settlement Number, if any.
(c) Delivery pursuant to this Article 3 shall be effected in accordance with the Seller’s customary procedures.
ARTICLE 4
Section 4.01 . Transactions by the Seller. (a) The parties agree and acknowledge that:
(i) | During the Hedging Period and any Seller Termination Share Purchase Period, the Seller (or its agent or affiliate) may effect transactions in shares of Common Stock in connection with this Confirmation. The timing of such transactions by the Seller, the price paid or received per share of Common Stock pursuant to such transactions and the manner in which such transactions are made, including without limitation whether such transactions are made on any securities exchange or privately, shall be within the sole judgment of the Seller; provided that the Seller shall use good faith efforts to make all purchases of Common Stock in a manner that would comply with the limitations set forth in clauses (b)(2), (b)(3), (b)(4) and (c) of Rule 10b-18 as if such rule were applicable to such purchases. |
(ii) | During the Averaging Period, the Seller (or its agent or affiliate) may effect transactions in shares of Common Stock in connection with this Confirmation. The timing of such transactions by the Seller, the price paid or received per share of Common Stock pursuant to such transactions and the manner in which such transactions are made, including without limitation whether such transactions are made on any securities exchange or privately, shall be within the sole judgment of the Seller. |
(iii) | The Purchaser shall, at least one day prior to the first day of the Hedging Period or the Seller Termination Share Purchase Period, notify the Seller of the total number of shares of Common Stock purchased in Rule 10b-18 purchases of blocks pursuant to the once-a-week block exception set forth in Rule 10b-18(b)(4) by or for the Purchaser or any of its Affiliated Purchasers during each of the four calendar weeks preceding such day and during the calendar week in which such day occurs (“Rule 10b-18 purchase” and “blocks” each being used as defined in Rule 10b-18), which notice shall be substantially in the form set forth as Exhibit B hereto. |
(b) | The Purchaser acknowledges and agrees that (i) all transactions effected pursuant to Section 4.01 hereunder shall be made in the Seller’s sole judgment and for the Seller’s own account and (ii) the Purchaser does not have, and shall not attempt to exercise, any influence over how, when or whether to effect such transactions, including, without limitation, the price paid or received per share of Common Stock pursuant to such transactions whether such transactions are made on any securities exchange or privately. It is the intent of the Seller and the Purchaser that this Transaction comply with the requirements of Rule 10b5-1(c) of the Exchange Act and that this Confirmation shall be interpreted to comply with the requirements of Rule 10b5-1(c)(1)(i)(B) and the Seller shall take no action that results in the Transaction not so complying with such requirements. |
(c) | Notwithstanding anything to the contrary in this Confirmation, the Purchaser acknowledges and agrees that, on any day, the Seller shall not be obligated to deliver or receive any shares of Common Stock to or from the Purchaser and the Purchaser shall not be entitled to receive any shares of Common Stock from the Seller on such day, to the extent (but only to the extent) that after such transactions the Seller’s ultimate parent entity would directly or indirectly beneficially own (as such term is defined for purposes of Section 13(d) of the Exchange Act) at any time on such day in excess of 8.0% of the outstanding shares of Common Stock. Any purported receipt or delivery of shares of Common Stock shall be void and have no effect to the extent (but only to the extent) that after any receipt or delivery of such shares of Common Stock the Seller’s ultimate parent entity would directly or indirectly so beneficially own in excess of 8.0% of the outstanding shares of Common Stock. If, on any day, any delivery or receipt of shares of Common Stock by the Seller is not effected, in whole or in part, as a result of this provision, the Seller’s and Purchaser’s respective obligations to make or accept such receipt or delivery shall not be extinguished and such receipt or delivery shall be effected over time as promptly as the Seller determines, in the reasonable determination of the Seller, that after such receipt or delivery its ultimate parent entity would not directly or indirectly beneficially own in excess of 8.0% of the outstanding shares of Common Stock. |
(b) The Purchaser agrees that, during the Contract Period, neither the Purchaser nor any of its affiliates or agents shall make any distribution (as defined in Regulation M) of Common Stock, or any security for which the Common Stock is a reference security (as defined in Regulation M) or take any other action that would, in the view of the Seller, preclude purchases by the Seller of the Common Stock or cause the Seller to violate any law, rule or regulation with respect to such purchases.
Section 4.03 . Purchases of Common Stock by the Purchaser. Except for transactions effected by an agent independent of the Purchaser within the meaning of Rule 10b-18(a)(13)(ii) by or for Purchaser’s 2006 Stock Incentive Plan, without the prior written consent of the Seller, the Purchaser shall not, and shall cause its affiliates and affiliated purchasers (each as defined in Rule 10b-18) not to, directly or indirectly (including, without limitation, by means of a derivative instrument) purchase, offer to purchase, place any bid or limit order that would effect a purchase of, or commence any tender offer relating to, any shares of Common Stock (or equivalent interest, including a unit of beneficial interest in a trust or limited partnership or a depository share) or any security convertible into or exchangeable for shares of Common Stock during the Contract Period.
ARTICLE 5
REPRESENTATIONS, WARRANTIES AND AGREEMENTS
(a) Disclosure; Compliance with Laws. The reports and other documents filed by the Purchaser with the SEC pursuant to the Exchange Act when considered as a whole (with the more recent such reports and documents deemed to amend inconsistent statements contained in any earlier such reports and documents), do not contain any untrue statement of a material fact or any omission of a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading. The Purchaser is not in possession of any material nonpublic information regarding the Purchaser or the Common Stock.
(b) Rule 10b5-1. The Purchaser acknowledges that (i) the Purchaser does not have, and shall not attempt to exercise, any influence over how, when or whether to effect purchases of Common Stock by the Seller (or its agent or affiliate) in connection with this Confirmation and (ii) the Purchaser is entering into the Agreement and this Confirmation in good faith and not as part of a plan or scheme to evade compliance with federal securities laws including, without limitation, Rule 10b-5 promulgated under the Exchange Act. The Purchaser also acknowledges and agrees that any amendment, modification, waiver or termination of this Confirmation must be effected in accordance with the requirements for the amendment or termination of a “plan” as defined in Rule 10b5-1(c) under the Exchange Act. Without limiting the generality of the foregoing, any such amendment, modification, waiver or termination shall be made in good faith and not as part of a plan or scheme to evade the prohibitions of Rule 10b-5 under the Exchange Act, and no amendment, modification or waiver shall be made at any time at which the Purchaser or any officer or director of the Purchaser is aware of any material nonpublic information regarding the Purchaser or the Common Stock.
(f) Due Authorization and Good Standing. The Purchaser is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. This Confirmation has been duly authorized, executed and delivered by the Purchaser and (assuming due authorization, execution and delivery thereof by the Seller) constitutes a valid and legally binding obligation of the Purchaser. The Purchaser has all corporate power to enter into this Confirmation and to consummate the transactions contemplated hereby and to purchase the Common Stock in accordance with the terms hereof.
(b) Non-Reliance. Each party has entered into this Transaction solely in reliance on its own judgment. Neither party has any fiduciary obligation to the other party relating to this Transaction. In addition, neither party has held itself out as advising, or has held out any of its employees or agents as having the authority to advise, the other party as to whether or not the other party should enter into this Transaction, any subsequent actions relating to this Transaction or any other matters relating to this Transaction. Neither party shall have any responsibility or liability whatsoever in respect of any advice of this nature given, or views expressed, by it or any such persons to the other party relating to this Transaction, whether or not such advice is given or such views are expressed at the request of the other party. The Purchaser has conducted its own analysis of the legal, accounting, tax and other implications of this Transaction and consulted such advisors, accountants and counsel as it has deemed necessary.
(a) Due Authorization. This Confirmation has been duly authorized, executed and delivered by the Seller and (assuming due authorization, execution and delivery thereof by the Purchaser) constitutes a valid and legally binding obligation of the Seller. The Seller has all corporate power to enter into this Confirmation and to consummate the transactions contemplated hereby and to deliver the Common Stock in accordance with the terms hereof.
(b) Right to Transfer. The Seller will, at the Initial Settlement Date, have the free and unqualified right to transfer the Number of Shares of Common Stock to be sold by the Seller pursuant to Section 2.01 hereof, free and clear of any security interest, mortgage, pledge, lien, charge, claim, equity or encumbrance of any kind.
ARTICLE 6
ARTICLE 7
(b) An Additional Termination Event shall occur in respect of which the Purchaser is the sole Affected Party and this Transaction is the sole Affected Transaction if (i) a Share De-listing Event occurs; (ii) a Merger Event occurs; (iii) a Nationalization occurs, (iv) the 10b-18 VWAP on any Trading Day following the Trade Date shall have been less than $8.50 (subject to adjustment under Section 8.02) or (v) an event described in paragraph III of Annex A occurs.
(c) A “Share De-listing Event” means that at any time during the Contract Period, the Common Stock ceases to be listed, traded or publicly quoted on the Exchange for any reason (other than a Merger Event, a “De-Listing”) and is not immediately re-listed, traded or quoted as of the date of such de-listing, on another U.S. national securities exchange or a U.S. automated interdealer quotation system (a “Successor Exchange”), provided that it shall not constitute an Additional Termination Event if the Common Stock is immediately re-listed on a Successor Exchange upon its De-Listing from the Exchange, and the Successor Exchange shall be deemed to be the Exchange for all purposes. In addition, in such event, the Seller shall make any commercially reasonable adjustments it deems necessary to the terms of the Transaction.
(d) A “Merger Event” means the public announcement, including any public announcement as defined in Rule 165(f) of the Securities Act (by the Purchaser or otherwise) at any time during the Contract Period of any (i) planned recapitalization, reclassification or change of the Common Stock that will, if consummated, result in a transfer of more than 20% of the outstanding shares of Common Stock, (ii) planned consolidation, amalgamation, merger or similar transaction of the Purchaser with or into another entity (other than a consolidation, amalgamation or merger in which the Purchaser will be the continuing entity and which does not result in any such recapitalization, reclassification or change of more than 20% of such shares outstanding), (iii) other takeover offer for the shares of Common Stock that is aimed at resulting in a transfer of more than 20% of such shares of Common Stock (other than such shares owned or controlled by the offeror) or (iv) irrevocable commitment to any of the foregoing.
(e) A “Nationalization” means that all or substantially all of the outstanding shares of Common Stock or assets of the Purchaser are nationalized, expropriated or are otherwise required to be transferred to any governmental agency, authority or entity.
(b) If cash settlement applies in respect of an Early Termination Date, Section 6 of the Agreement shall apply.
ARTICLE 8
(b) If the Purchaser declares any cash dividend on shares of Common Stock that is not an Extraordinary Cash Dividend (an “Ordinary Cash Dividend”) and that has a record date during the Contract Period, and the amount of such Ordinary Cash Dividend, together with all prior declared Ordinary Cash Dividends that have a record date during the same regular dividend period of the Purchaser, exceeds the amount set forth in the Pricing Supplement for such regular dividend period, the Calculation Agent shall make corresponding adjustments with respect to the Initial Purchase Price, the Upside Threshold and the Minimum Delivery Number as the Calculation Agent determines appropriate to preserve the fair value of the Transaction to the Seller, and shall determine the effective date of such adjustment.
ARTICLE 9
(a) If to the Purchaser:
Nu Skin Enterprises, Inc. 00 Xxxx Xxxxxx Xxxxxx Xxxxx, XX 00000 Attention: Xxxxx Xxxxx Title: Vice President of Finance Telephone No: (000) 000-0000 Facsimile No: (000) 000-0000 |
(b) If to the Seller:
JPMorgan Chase Bank, National Associationc/o X.X. Xxxxxx Securities Xxx.000 Xxxx Xxxxxx Xxx Xxxx, XX 00000 Attention: Xxxx Xxxxxxxx Title: Operations Analyst EDG Corporate Marketing Telephone No: (000) 000-0000 Facsimile No: (000) 000-0000 |
A-2
Please confirm that the foregoing correctly sets forth the terms of our agreement by executing the copy of this Confirmation enclosed for that purpose and returning it to us.
Yours sincerely,
X.X. XXXXXX SECURITIES INC., as agent for JPMorgan Chase Bank, National Association, London Branch
By: /s/ Xxxxxx La Mariana Name: Xxxxxx La Mariana Title: Vice President
Confirmed as of the date first above written:
NU SKIN ENTERPRISES, INC.
By: /s/ Xxxxx Xxxx Name: Xxxxx Xxxx Title: Chief Financial Officer
ANNEX A
COMMUNICATIONS PROCEDURES
November 7, 2007
I. Introduction
Nu Skin Enterprises, Inc., a Delaware corporation (“Counterparty”) and X.X. Xxxxxx Securities Inc., as agent for JPMorgan Chase Bank, National Association, London Branch (“JPMorgan”) have adopted these communications procedures (the “Communications Procedures”) in connection with entering into the Confirmation (the “Confirmation”) dated as of November 7, 2007 between JPMorgan and Counterparty relating to the sale by JPMorgan to Counterparty of common stock, par value $0.001 per share, or security entitlements in respect thereof (the “Common Stock”) of the Counterparty. These Communications Procedures supplement, form part of, and are subject to the Confirmation.
II. Communications Rules
1. From the date hereof until the end of the Contract Period, Counterparty and its Employees and Designees shall not engage in any Program-Related Communication with, or disclose any Material Non-Public Information to, any EDG Trading Personnel. Except as set forth in the preceding sentence, the Confirmation shall not limit Counterparty and its Employees and Designees in their communication with Affiliates and Employees of JPMorgan, including without limitation Employees who are EDG Permitted Contacts.
III. Termination
If, in the sole judgment of any EDG Trading Personnel or any affiliate or Employee of JPMorgan participating in any Communication with Counterparty or any Employee or Designee of Counterparty, such Communication would not be permitted by these Communications Procedures, such EDG Trading Personnel or affiliate or Employee of JPMorgan shall immediately terminate such Communication. In such case, or if such EDG Trading Personnel or affiliate or Employee of JPMorgan determines following completion of any Communication with Counterparty or any Employee or Designee of Counterparty that such Communication was not permitted by these Communications Procedures, such EDG Trading Personnel or such affiliate or Employee of JPMorgan shall promptly consult with his or her supervisors and with counsel for JPMorgan regarding such Communication. If, in the reasonable judgment of JPMorgan’s counsel following such consultation, there is more than an insignificant risk that such Communication could materially jeopardize the availability of the affirmative defenses provided in Rule 10b5-1 under the 1934 Act with respect to any ongoing or contemplated activities of JPMorgan or its affiliates in respect of the Confirmation, it shall be an Additional Termination Event with respect to the Confirmation.
IV. Definitions
Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in the Confirmation. As used herein, the following words and phrases shall have the following meanings:
“Communication” means any contact or communication (whether written, electronic, oral or otherwise) between Counterparty or any of its Employees or Designees, on the one hand, and JPMorgan or any of its affiliates or Employees, on the other hand.
“Designee” means a person designated, in writing or orally, by Counterparty to communicate with JPMorgan on behalf of Counterparty.
“EDG Permitted Contact” means any of Xx. Xxxxx Xxxxxxxx, Xx. Xxxxxxxxxx Xxxxxxx, Xx. Xxxxxxx Xxxxxxx, Xx. Xxxxxx Xxxxxx, Xx. Xxxxxxx Xxxxx, Xx. Xxxxx Xxxxxxxxxx and Xx. Xxxxx X. Xxxxx, Xx. Xxxx Xxxxxxxxx, Xx. Xxxxxx Xxxxxx or any of their designees; provided that JPMorgan may amend the list of EDG Permitted Contacts by delivering a revised list of EDG Permitted Contacts to Counterparty.
“EDG Trading Personnel” means Xxxxxx Xxxxx, Xxxxxx Xxxxx and any other Employee of the public side of the Equity Derivatives Group or the Special Equities Group of X.X. Xxxxxx Chase & Co.; provided that JPMorgan may amend the list of EDG Trading Personnel by delivering a revised list of EDG Trading Personnel to Counterparty; and provided further that, for the avoidance of doubt, the persons listed as EDG/SEG Permitted Contacts are not EDG/SEG Trading Personnel.
“Employee” means, with respect to any entity, any owner, principal, officer, director, employee or other agent or representative of such entity, and any affiliate of any of such owner, principal, officer, director, employee, agent or representative.
“Material Non-Public Information” means information relating to the Counterparty or the Common Stock that (a) has not been widely disseminated by wire service, in one or more newspapers of general circulation, by communication from the Counterparty to its shareholders or in a press release, or contained in a public filing made by the Counterparty with the Securities and Exchange Commission and (b) a reasonable investor might consider to be of importance in making an investment decision to buy, sell or hold shares of Common Stock. For the avoidance of doubt and solely by way of illustration, information should be presumed “material” if it relates to such matters as dividend increases or decreases, earnings estimates, changes in previously released earnings estimates, significant expansion or curtailment of operations, a significant increase or decline of orders, significant merger or acquisition proposals or agreements, significant new products or discoveries, extraordinary borrowing, major litigation, liquidity problems, extraordinary management developments, purchase or sale of substantial assets and similar matters.
“Program-Related Communication” means any Communication the subject matter of which relates to the Confirmation or any Transaction under the Confirmation or any activities of JPMorgan (or any of its affiliates) in respect of the Confirmation or any Transaction under the Confirmation.
B-1
ANNEX B
PRICING SUPPLEMENT
This Pricing Supplement is subject to the Confirmation dated as of November 7, 2007 (the “Confirmation”) between X.X. Xxxxxx Securities Inc., as agent for JPMorgan Chase Bank, National Association, London Branch (the “Seller”), and Nu Skin Enterprises, Inc., a Delaware corporation (the “Purchaser”). Capitalized terms used herein have the meanings set forth in the Confirmation.
1 | Discount: | $0.17 | ||||||
2 | Initial Number of Shares | 1,000,000 shares of Common Stock | ||||||
3 | Upside Threshold: | Subject to the proviso contained in Section 2.04(b), 113% of the Hedging Price. | ||||||
4 | Valuation Completion Date: | The Trading Day, during the period commencing on and including the 31st Trading Day following the Hedging Completion Date and ending on and including the Expiration Date, specified as such by the Seller, in its sole judgment, by delivering a notice designating such Trading Day as a Valuation Completion Date by the close of business on the Business Day immediately following such Trading Day; provided that if the Seller fails to validly designate the Valuation Completion Date prior to the Expiration Date, the Valuation Completion Date shall be the Expiration Date. | ||||||
5 | Ordinary Dividend Amount: : | Ordinary Dividend Amount: | Dividend Period | |||||
$0.00 per share of Common Stock | November 7, 2007-November 29, 2007 | |||||||
$0.105 per share of Common Stock | November 30, 2007-March 2, 2008 | |||||||
$0.00 per share of Common Stock | Any period after March 3, 2008 |
Exh-A-1
EXHIBIT A
FORM OF HEDGING COMPLETION NOTICE
JPMorgan Chase Bank, National Association
c/o X.X. Xxxxxx Securities Inc.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
[Date]
Nu Skin Enterprises, Inc. 00 Xxxx Xxxxxx Xxxxxx Xxxxx, XX 00000
Ladies and Gentlemen:
This letter is a hedging completion notice within the meaning of Section 2.04(c) of the Confirmation dated as of November 7, 2007 (the “Confirmation”) between Nu Skin Enterprises, Inc. (the “Purchaser”) and JPMorgan Chase Bank, National Association, London Branch (the “Seller”), by X.X. Xxxxxx Securities Inc., as its agent. Capitalized terms used herein have the meanings set forth in the Confirmation.
This hedging completion notice relates to the Transaction described in the Confirmation. Upon the terms and subject to the conditions of the Confirmation, the terms of the Transaction shall be as follows:
1. Hedging Price: [__________]. 2. Upside Threshold: [__________] 3. Minimum Delivery Number: [__________]. 4. First Day of the Averaging Period: [__________].
The expected last day of the Averaging Period is [________].
Very truly yours,
X.X. XXXXXX SECURITIES INC., as agent for JPMorgan Chase Bank, National Association, London Branch By: Name: Title: |
Acknowledged and Confirmed:
NU SKIN ENTERPRISES, INC.
By: Name: Title:
Exh-B-1
EXHIBIT B
[Letterhead of Purchaser]
JPMorgan Chase Bank, National Association c/o X.X. Xxxxxx Securities Inc. 000 Xxxx Xxxxxx00xx Xxxxx Xxx Xxxx, Xxx Xxxx 00000
Re: Accelerated Purchase of Equity Securities
Ladies and Gentlemen:
In connection with our entry into the Confirmation dated as of November 7, 2007 (the “Confirmation”), we hereby represent that set forth below is the total number of shares of our common stock purchased by or for us or any of our affiliated purchasers in Rule 10b-18 purchases of blocks (all defined in Rule 10b-18 under the Securities Exchange Act of 1934) pursuant to the once-a-week block exception set forth in Rule 10b-18(b)(4) during the four full calendar weeks immediately preceding the first day of the Averaging Period (as defined in the Confirmation) and the week during which the first day of the Hedging Period occurs.
Number of Shares: __________________
We understand that you will use this information in calculating trading volume for purposes of Rule 10b-18.
Very truly yours,
NU SKIN ENTERPRISES, INC. By: Name: Title: