PURCHASE CONTRACT AGREEMENT
XL CAPITAL LTD AND U.S. BANK NATIONAL ASSOCIATION,
AS PURCHASE CONTRACT AGENT
PURCHASE CONTRACT AGREEMENT
DATED AS OF MARCH 23, 2004
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION.................................................1
SECTION 1.1. Definitions...............................................................................1
SECTION 1.2. Compliance Certificates and Opinions.....................................................13
SECTION 1.3. Form of Documents Delivered to Agent.....................................................14
SECTION 1.4. Acts of Holders; Record Dates............................................................14
SECTION 1.5. Notices 15
SECTION 1.6. Notice to Holders; Waiver................................................................16
SECTION 1.7. Effect of Headings and Table of Contents.................................................17
SECTION 1.8. Successors and Assigns...................................................................17
SECTION 1.9. Separability Clause......................................................................17
SECTION 1.10. Benefits of Agreement...................................................................17
SECTION 1.11. Governing Law...........................................................................17
SECTION 1.12. Judgment Currency.......................................................................18
SECTION 1.13. Legal Holidays..........................................................................18
SECTION 1.14. Counterparts............................................................................19
SECTION 1.15. Inspection of Agreement.................................................................19
SECTION 1.16. Appointment of Financial Institution as Agent for the Company...........................19
SECTION 1.17. No Waiver...............................................................................19
ARTICLE II CERTIFICATE FORMS.....................................................................................19
SECTION 2.1. Forms of Certificates Generally..........................................................19
SECTION 2.2. Form of Agent's Certificate of Authentication............................................21
ARTICLE III THE UNITS............................................................................................21
SECTION 3.1. Number of Units; Denominations...........................................................21
SECTION 3.2. Rights and Obligations Evidenced by the Certificates.....................................21
SECTION 3.3. Execution, Authentication, Delivery and Dating...........................................22
SECTION 3.4. Temporary Certificates...................................................................23
SECTION 3.5. Registration; Registration of Transfer and Exchange......................................23
SECTION 3.6. Book-Entry Interests.....................................................................25
SECTION 3.7. Notices to Holders.......................................................................25
SECTION 3.8. Appointment of Successor Clearing Agency.................................................25
SECTION 3.9. Definitive Certificates..................................................................26
SECTION 3.10. Mutilated, Destroyed, Lost and Stolen Certificates......................................26
SECTION 3.11. Persons Deemed Owners...................................................................27
SECTION 3.12. Cancellation............................................................................28
SECTION 3.13. Establishment of Stripped Units.........................................................28
SECTION 3.14. Reestablishment of Normal Units.........................................................29
SECTION 3.15. Transfer of Collateral upon Occurrence of Termination Event.............................31
SECTION 3.16. No Consent to Assumption................................................................31
SECTION 3.17. CUSIP Numbers...........................................................................31
SECTION 3.18. Currency of Payments....................................................................32
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ARTICLE IV THE NOTES.............................................................................................32
SECTION 4.1. Payment of Interest; Rights to Interest Payments Preserved; Notice.......................32
SECTION 4.2. Notice and Voting........................................................................32
SECTION 4.3. Special Event Redemption.................................................................33
SECTION 4.4. Consent to Treatment for Tax Purposes....................................................34
ARTICLE V THE PURCHASE CONTRACTS; THE REMARKETING................................................................34
SECTION 5.1. Purchase of Ordinary Shares..............................................................34
SECTION 5.2. Contract Adjustment Payments.............................................................36
SECTION 5.3. Deferral of Contract Adjustment Payments.................................................41
SECTION 5.4. Payment of Purchase Price; Remarketing...................................................43
SECTION 5.5. Issuance of Ordinary Shares..............................................................47
SECTION 5.6. Adjustment of Settlement Rate............................................................47
SECTION 5.7. Notice of Adjustments and Certain Other Events...........................................53
SECTION 5.8. Termination Event; Notice................................................................54
SECTION 5.9. Early Settlement.........................................................................54
SECTION 5.10. Early Settlement Upon Cash Merger.......................................................56
SECTION 5.11. Charges and Taxes.......................................................................58
SECTION 5.12. No Fractional Shares....................................................................58
ARTICLE VI REMEDIES..............................................................................................59
SECTION 6.1. Unconditional Right of Holders to Receive Purchase Contract Adjustment
Payments and Purchase Ordinary Shares................................................59
SECTION 6.2. Restoration of Rights and Remedies.......................................................59
SECTION 6.3. Rights and Remedies Cumulative...........................................................59
SECTION 6.4. Delay or Omission Not Waiver.............................................................59
SECTION 6.5. Undertaking for Costs....................................................................60
SECTION 6.6. Waiver of Stay or Extension Laws.........................................................60
ARTICLE VII THE AGENT............................................................................................60
SECTION 7.1. Certain Duties and Responsibilities......................................................60
SECTION 7.2. Notice of Default........................................................................61
SECTION 7.3. Certain Rights of Agent..................................................................61
SECTION 7.4. Not Responsible for Recitals or Issuance of Units........................................63
SECTION 7.5. May Hold Units...........................................................................63
SECTION 7.6. Money Held in Custody....................................................................63
SECTION 7.7. Compensation and Reimbursement...........................................................63
SECTION 7.8. Corporate Agent Required; Eligibility....................................................64
SECTION 7.9. Resignation and Removal; Appointment of Successor........................................64
SECTION 7.10. Acceptance of Appointment by Successor...................................................65
SECTION 7.11. Merger, Conversion, Consolidation or Succession to Business..............................66
SECTION 7.12. Preservation of Information..............................................................66
SECTION 7.13. No Obligations of Agent..................................................................66
SECTION 7.14. Tax Compliance...........................................................................66
ARTICLE VIII SUPPLEMENTAL AGREEMENTS.............................................................................67
SECTION 8.1. Supplemental Agreements Without Consent of Holders.......................................67
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SECTION 8.2. Supplemental Agreements with Consent of Holders..........................................68
SECTION 8.3. Execution of Supplemental Agreements.....................................................69
SECTION 8.4. Effect of Supplemental Agreements........................................................69
SECTION 8.5. Reference to Supplemental Agreements.....................................................69
ARTICLE IX CONSOLIDATION, MERGER, SALE OR CONVEYANCE.............................................................69
SECTION 9.1. Covenant Not to Merge, Consolidate, Sell or Convey Property Except
Under Certain Conditions ............................................................69
SECTION 9.2. Rights and Duties of Successor Corporation...............................................70
SECTION 9.3. Opinion of Counsel Given to Agent........................................................70
ARTICLE X COVENANTS..............................................................................................70
SECTION 10.1. Performance Under Purchase Contracts....................................................70
SECTION 10.2. Maintenance of Office or Agency.........................................................71
SECTION 10.3. Company to Reserve Ordinary Shares......................................................71
SECTION 10.4. Covenants as to Ordinary Shares.........................................................71
SECTION 10.5. Statements of Officer of the Company as to Default......................................72
SECTION 10.6. Listing.................................................................................72
SECTION 10.7. Registration Statement..................................................................72
SECTION 10.8. Securities Contract.....................................................................72
SECTION 10.9. Additional Amounts......................................................................72
EXHIBITS
EXHIBIT A Form of Normal Units Certificate
EXHIBIT B Form of Stripped Units Certificate
EXHIBIT C Instruction from Purchase Contract Agent to Collateral Agent
EXHIBIT D Instruction to Purchase Contract Agent
EXHIBIT E Notice to Settle by Separate Cash
EXHIBIT F Formula for Fixing Settlement Rate
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PURCHASE CONTRACT AGREEMENT, dated as of March 23, 2004,
between XL Capital Ltd, a Cayman Island exempted limited company (the
"Company"), and U.S. Bank National Association, a national banking association,
acting as purchase contract agent and attorney-in-fact for the Holders of Units
from time to time (the "Agent").
RECITALS
The Company has duly authorized the execution and delivery of
this Agreement and the Certificates evidencing the Units.
All things necessary to make the Purchase Contracts, when the
Certificates are executed by the Company and authenticated, executed on behalf
of the Holders and delivered by the Agent, as provided in this Agreement, the
valid obligations of the Company, and to constitute this Agreement a valid
agreement of the Company, in accordance with its terms, have been done.
WITNESSETH:
For and in consideration of the premises and the purchase of
the Units by the Holders thereof, it is mutually agreed as follows:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.1. DEFINITIONS.
For all purposes of this Agreement, except as otherwise
expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the singular,
and nouns and pronouns of the masculine gender include the feminine and neuter
genders;
(b) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States;
(c) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Agreement as a whole and not to any
particular Article, Section or other subdivision; and
(d) the following terms have the meanings given to them in
this Section 1.1(d):
"Accounting Redemption Event" means the receipt at any time
prior to the earlier of the date of any successful remarketing of the Notes
pursuant to the provisions of Section 5.4 and the Stock Purchase Date by the
audit committee of the Board of Directors of a written report in accordance with
Statement on Auditing Standards ("SAS") No. 97, "Amendment to SAS No. 50 -
Reports on the Application of Accounting Principles," from the Company's
independent
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auditors, provided at the request of the management of the Company, to the
effect that, as a result of a change in accounting rules or interpretations
thereof applicable to the Company after March 23, 2004, the Company must either
(a) account for the Purchase Contracts as derivatives under SFAS 133 (or any
successor accounting standard) or (b) account for the Units using the
if-converted method under SFAS 128 (or any successor accounting standard), and
that such accounting treatment will cease to apply upon redemption of the Notes.
"Accounting Settlement Rate Event" means the receipt at any
time prior to the earlier of the date of any successful remarketing of the Notes
pursuant to the provisions of Section 5.4 and the Stock Purchase Date by the
audit committee of the Board of Directors of a written report in accordance with
Statement on Auditing Standards ("SAS") No. 97, "Amendment to SAS No. 50 -
Reports on the Application of Accounting Principles," from the Company's
independent auditors, provided at the request of the management of the Company,
to the effect that, as a result of a change in accounting rules or
interpretations thereof applicable to the Company after March 23, 2004, the
Company must either (a) account for the Purchase Contracts as derivatives under
SFAS 133 (or any successor accounting standard) or (b) account for the Units
using the if-converted method under SFAS 128 (or any successor accounting
standard), and that such accounting treatment will cease to apply upon the
fixing of the Settlement Rate on the Purchase Contracts.
"Act" when used with respect to any Holder, has the meaning
specified in Section 1.4(a).
"Affiliate" has the same meaning as given to that term in Rule
405 of the Securities Act or any successor rule thereunder.
"Agent" means the Person named as the "Agent" in the first
paragraph of this Agreement until a successor Agent shall have become such
pursuant to the applicable provisions of this Agreement, and thereafter "Agent"
shall mean such Person.
"Agreement" means this agreement as originally executed or as
it may from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Applicable Market Value" has the meaning specified in Section
5.1(c).
"Bankruptcy Code" means Title 11 of the United States Code, or
any other law of the United States that from time to time provides a uniform
system of bankruptcy laws.
"Bankruptcy Law" means (i) the Bankruptcy Code or (ii) any and
all relevant provisions of the Companies Law (2003 Revision), or any successor
thereto, relating to the winding up of the Company at any time when it is unable
to pay its debts as they fall due in the ordinary course of business (including
without limitation in the circumstances set out in Section 95 of the Companies
Law).
"Beneficial Owner" means, with respect to a Book-Entry
Interest, a Person who is the beneficial owner of such Book-Entry Interest as
reflected on the books of the Clearing Agency or on the books of a Person
maintaining an account with such Clearing Agency (directly
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as a Clearing Agency Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).
"Board of Directors" means either the Board of Directors of
the Company or the executive committee of such Board of Directors or any other
committee of such Board of Directors duly authorized to act generally or in any
particular respect for the Board of Directors hereunder.
"Board Resolution" means (i) a copy of a resolution certified
by the Secretary or the Assistant Secretary of the Company to have been duly
adopted by the Board of Directors and to be in full force and effect on the date
of such certification, (ii) a copy of a unanimous written consent of the Board
of Directors or (iii) a certificate signed by the authorized officer or officers
to whom the Board of Directors has delegated its authority and, in each case,
delivered to the Agent.
"Book-Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 3.6.
"Business Day" means any day other than a Saturday, Sunday or
other day in the City of New York, in the City of Boston, Massachussetts, in
Bermuda or in any Place of Payment on which banking institutions are authorized
by law or regulations to close.
"Capital Stock" means any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of or interests
in (however designated, whether voting or non-voting) corporate stock or similar
interests in other types of entities.
"Cash Merger" has the meaning set forth in Section 5.10(a).
"Cash Merger Date" means the date on which a Cash Merger is
consummated.
"Cash Settlement" has the meaning set forth in Section 5.4(a).
"Certificate" means a Normal Units Certificate or a Stripped
Units Certificate.
"Clearing Agency" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act that is acting as
a depositary for the Units and in whose name, or in the name of a nominee of
that organization, shall be registered a Global Certificate and which shall
undertake to effect book-entry transfers and pledges of the Units.
"Clearing Agency Participant" means a broker, dealer, bank,
trust company, clearing corporation, other financial institution or other Person
for whom from time to time the Clearing Agency effects book-entry transfers and
pledges of securities deposited with the Clearing Agency.
"Closing Price" has the meaning set forth in Section 5.1(c).
"Collateral" has the meaning set forth in Section 2.1(a) of
the Pledge Agreement.
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"Collateral Agent" means U.S. Bank Trust National Association,
a national banking association, as Collateral Agent under the Pledge Agreement
until a successor Collateral Agent shall have become such pursuant to the
applicable provisions of the Pledge Agreement, and thereafter "Collateral Agent"
shall mean the Person who is then the Collateral Agent thereunder.
"Collateral Substitution" has the meaning set forth in Section
3.13(a).
"Company" means the Person named as the "Company" in the first
paragraph of this Agreement until a successor shall have become such pursuant to
the applicable provisions of this Agreement, and thereafter "Company" shall mean
such successor.
"Constituent Person" has the meaning set forth in Section
5.6(b).
"Contract Adjustment Payments" means, in the case of Normal
Units and Stripped Units, the amount payable by the Company in respect of each
Purchase Contract constituting a part of such Unit, which amount shall be equal
to 3.97% per year of the Stated Amount, in each case computed (i) for any full
quarterly period, on the basis of a 360-day year of twelve 30-day months and
(ii) for any period shorter than a full quarterly period, on the basis of a
30-day month, and for periods of less than a month, on the basis of the actual
number of days elapsed per 30-day month, plus any Deferred Contract Adjustment
Payments accrued pursuant to Section 5.3.
"Corporate Trust Office" means the corporate trust office of
the Agent at which, at any particular time, its corporate trust business shall
be principally administered, which office at the date hereof is located at 000
Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000, Attention:
[____________].
"Coupon Rate" means the percentage rate per annum at which
each Note will bear interest initially.
"Current Market Price" has the meaning set forth in Section
5.6(a)(8).
"Custodial Agent" means U.S. Bank Trust National Association,
a national banking association, as Custodial Agent under the Pledge Agreement
until a successor Custodial Agent shall have become such pursuant to the
applicable provisions of the Pledge Agreement, and thereafter "Custodial Agent"
shall mean the Person who is then the Custodial Agent thereunder.
"Default" means a default by the Company in any of its
obligations under this Agreement.
"Deferred Contract Adjustment Payments" has the meaning set
forth in Section 5.3(a).
"Depositary" means, initially, DTC, until another Clearing
Agency becomes its successor, and thereafter "Depositary" shall mean such
successor.
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"DTC" means The Depository Trust Company, the initial Clearing
Agency.
"Early Settlement" has the meaning set forth in Section
5.9(a).
"Early Settlement Amount" has the meaning set forth in Section
5.9(a).
"Early Settlement Date" has the meaning set forth in Section
5.9(a).
"Early Settlement Rate" has the meaning set forth in Section
5.9(b).
"Exchange Act" means the Securities Exchange Act of 1934 and
any statute successor thereto, in each case as amended from time to time, and
the rules and regulations promulgated thereunder.
"Expiration Date" has the meaning set forth in Section 1.4(f).
"Expiration Time" has the meaning set forth in Section
5.6(a)(6).
"Failed Remarketing" has the meaning set forth in Section
5.4(b)(ii).
"Fair Market Value," with respect to securities distributed in
a Spin-Off, means (a) in the case of any Spin-Off that is effected
simultaneously with an Initial Public Offering of such securities, the initial
public offering price of those securities and (b) in the case of any other
Spin-Off, the average of the Sale Price of those securities over the first ten
Trading Days after the effective date of such Spin-Off.
"First Supplemental Indenture" means the First Supplemental
Indenture, dated as of March 23, 2004, to the Indenture between the Company and
the Trustee.
"Global Certificate" means a Certificate that evidences all or
part of the Units and is registered in the name of a Depositary or a nominee
thereof.
"Holder" means the Person in whose name the Unit evidenced by
a Normal Units Certificate and/or a Stripped Units Certificate is registered in
the related Normal Units Register and/or the Stripped Units Register, as the
case may be.
"Indenture" means the Indenture, dated as of January 23, 2003,
between the Company and the Trustee pursuant to which the Notes are to be
issued, as originally executed and delivered and as it may from time to time be
supplemented or amended by one or more indentures supplemental thereto entered
into pursuant to the applicable provisions thereof and shall include the terms
of a particular series established as contemplated thereof.
"Initial Public Offering," with respect to a Spin-Off, means
the first time securities of the same class or type as the securities being
distributed in such Spin-Off are bona fide offered to the public for cash.
"Issuer Order" or "Issuer Request" means a written order or
request signed in the name of the Company by the Chief Executive Officer, the
Chief Financial Officer, the President,
6
any Vice-President, the Treasurer, any Assistant Treasurer, the Secretary or any
Assistant Secretary (or other officer performing similar functions) of the
Company and delivered to the Agent.
"Last Failed Remarketing" has the meaning set forth in Section
5.4(b)(ii).
"Merger Early Settlement" has the meaning set forth in Section
5.10(a).
"Merger Early Settlement Amount" has the meaning set forth in
Section 5.10(b).
"Merger Early Settlement Date" has the meaning set forth in
Section 5.10(a)(i).
"Non-electing Share" has the meaning set forth in Section
5.6(b).
"Normal Unit" means the collective rights and obligations of a
Holder of a Normal Units Certificate in respect of a 1/40 undivided beneficial
interest in a Note in the original principal amount of $1,000 or the Treasury
Consideration, as the case may be, subject in each case to the Pledge thereof,
and the related Purchase Contract.
"Normal Units Certificate" means a certificate evidencing the
rights and obligations of a Holder in respect of the number of Normal Units set
forth on such certificate, substantially in the form of Exhibit A hereto.
"Normal Units Register" and "Normal Units Registrar" have the
respective meanings set forth in Section 3.5(a).
"Notes" means the 2.53% Senior Notes due 2009 of the Company
issued under the Indenture.
"NYSE" has the meaning set forth in Section 5.1(c).
"Officers' Certificate" means a certificate signed by the
Chief Executive Officer, the Chief Financial Officer, the President or any
Vice-President, and by the Treasurer, any Assistant Treasurer, the Secretary or
any Assistant Secretary (or other officer performing similar functions) of the
Company and delivered to the Agent.
"Opinion of Counsel" means an opinion in writing signed by
legal counsel, who may be an employee of or counsel to the Company or an
Affiliate of the Company and who shall be reasonably acceptable to the Agent.
"Ordinary Shares" means the Class A Ordinary Shares, par value
$0.01 per share, of the Company.
"Outstanding Units" means, as of the date of determination,
all Normal Units or Stripped Units evidenced by Certificates theretofore
authenticated, executed and delivered under this Agreement, except:
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(i) If a Termination Event has occurred, (A) Stripped
Units and (B) Normal Units for which the related Notes or the
Treasury Consideration, as the case may be, has been
theretofore deposited with the Agent in trust for the Holders
of such Normal Units;
(ii) Normal Units and Stripped Units evidenced by
Certificates theretofore cancelled by the Agent or delivered
to the Agent for cancellation or deemed cancelled pursuant to
the provisions of this Agreement; and
(iii) Normal Units and Stripped Units evidenced by
Certificates in exchange for or in lieu of which other
Certificates have been authenticated, executed on behalf of
the Holder and delivered pursuant to this Agreement, other
than any such Certificate in respect of which there shall have
been presented to the Agent proof satisfactory to it that such
Certificate is held by a protected purchaser in whose hands
the Normal Units or Stripped Units evidenced by such
Certificate are valid obligations of the Company;
provided that, in determining whether the Holders of the requisite number of the
Normal Units or Stripped Units have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Normal Units or Stripped Units
owned by the Company or any Affiliate of the Company shall be disregarded and
deemed not to be outstanding, except that, in determining whether the Agent
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Normal Units or Stripped Units which
a Responsible Officer of the Agent knows to be so owned shall be so disregarded.
Normal Units or Stripped Units so owned which have been pledged in good faith
may be regarded as Outstanding Units if the pledgee establishes to the
satisfaction of the Agent the pledgee's right so to act with respect to such
Normal Units or Stripped Units and that the pledgee is not the Company or any
Affiliate of the Company.
"Payment Date" means each February 15, May 15, August 15 and
November 15, commencing May 15, 2004 and ending on May 15, 2007.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Pledge" means the pledge under the Pledge Agreement of the
Notes, the Treasury Securities or the Treasury Consideration, in each case
constituting a part of the Units, property, cash, securities, financial assets
and security entitlements of the Collateral Account (as defined in the Pledge
Agreement) and any proceeds of any of the foregoing.
"Pledge Agreement" means the Pledge Agreement, dated as of the
date hereof, by and among the Company, the Collateral Agent, the Custodial
Agent, the Securities Intermediary and the Agent, on its own behalf and as
attorney-in-fact for the Holders from time to time of the Units.
"Pledged Notes" has the meaning set forth in Section 2.1(c) of
the Pledge Agreement.
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"Pledged Treasury Consideration" has the meaning set forth in
Section 2.1(c) of the Pledge Agreement.
"Pledged Treasury Securities" has the meaning set forth in
Section 2.1(c) of the Pledge Agreement.
"Predecessor Certificate" means a Predecessor Normal Units
Certificate or a Predecessor Stripped Units Certificate.
"Predecessor Normal Units Certificate" of any particular
Normal Units Certificate means every previous Normal Units Certificate
evidencing all or a portion of the rights and obligations of the Company and the
Holder under the Normal Units evidenced thereby; and, for the purposes of this
definition, any Normal Units Certificate authenticated and delivered under
Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Normal Units Certificate shall be deemed to evidence the same rights and
obligations of the Company and the Holder as the mutilated, destroyed, lost or
stolen Normal Units Certificate.
"Predecessor Stripped Units Certificate" of any particular
Stripped Units Certificate means every previous Stripped Units Certificate
evidencing all or a portion of the rights and obligations of the Company and the
Holder under the Stripped Units evidenced thereby; and, for the purposes of this
definition, any Stripped Units Certificate authenticated and delivered under
Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Stripped Units Certificate shall be deemed to evidence the same rights
and obligations of the Company and the Holder as the mutilated, destroyed, lost
or stolen Stripped Units Certificate.
"Purchase Contract," when used with respect to any Unit, means
the contract forming a part of such Unit and obligating the Company to issue and
sell and the Holder of such Unit to purchase Ordinary Shares on the terms and
subject to the conditions set forth in Article V.
"Purchase Contract Settlement Fund" has the meaning set forth
in Section 5.5.
"Purchase Price" has the meaning set forth in Section 5.1(a).
"Purchased Shares" has the meaning set forth in Section
5.6(a)(6).
"Quotation Agent" means Xxxxxxx, Xxxxx & Co. or any of its
successors or any other primary U.S. government securities dealer in New York
City selected by the Company.
"Record Date" for the payment of a distribution payable on any
Payment Date means, the 15th calendar day preceding such Payment Date.
"Redemption Price" means, for each Note, whether or not
included in a Normal Unit, (a) the greater of the principal amount of such Note
and (b) the product of (i) the principal amount of such Note and (ii) a fraction
whose numerator is the applicable Treasury Portfolio Purchase Price and whose
denominator is the applicable Special Event Redemption Principal Amount.
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"Register" means the Normal Units Register and the Stripped
Units Register, as applicable.
"Registrar" means the Normal Units Registrar and the Stripped
Units Registrar, as applicable.
"Relevant Date" means, in respect of any payment, the date on
which such payment first becomes due and payable, but if the full amount of the
moneys payable has not been received by the Agent on or prior to such due date,
it means the first date on which, the full amount of such moneys having been so
received and being available for payment to Holders, notice to that effect shall
have been duly given to the Holders.
"Remarketing Agent" has the meaning set forth in Section
5.4(b)(i).
"Remarketing Agreement" means the Remarketing Agreement to be
entered into by and among the Company, the Remarketing Agent and the Agent.
"Remarketing Date" means the ninth Business Day before the
Stock Purchase Date, which shall be May 2, 2007.
"Remarketing Fee" has the meaning set forth in Section
5.4(b)(i).
"Remarketing Period" means the seven Business Day period
beginning on the Remarketing Date and ending on the third Business Day preceding
the Stock Purchase Date.
"Remarketing Rate" means the percentage rate per year at which
each Note will bear interest on and following the Reset Date.
"Reorganization Event" has the meaning set forth in Section
5.6(b).
"Reset Date" means the date following the Remarketing Date or
a Subsequent Remarketing Period, as applicable, on which the trades in a
successful remarketing of the Notes, pursuant to the provisions of Section 5.4,
settle. Notwithstanding whether a successful remarketing occurs on the
Remarketing Date or on a Subsequent Remarketing Date, the settlement date for
such remarketing shall be on the Stock Purchase Date; provided that the Company
with the consent of the Remarketing Agent and the Agent shall have the option to
provide for a settlement date of a successful remarketing that is earlier than
the Stock Purchase Date so long as the Company shall pay on the Stock Purchase
Date to the Holders of the Normal Units and the Separate Notes participating in
the remarketing an interest payment on the Notes for the period from and
including the Payment Date immediately preceding the Stock Purchase Date to but
excluding the Stock Purchase Date at the Coupon Rate.
"Responsible Officer" means, when used with respect to the
Agent, any officer within the corporate trust department of the Agent (or any
successor of the Agent), including any Vice-President, any assistant
Vice-President, any assistant secretary, the treasurer, any assistant treasurer,
any trust officer, any senior trust officer or any other officer of the Agent
who customarily performs functions similar to those performed by the Persons who
at the time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of such
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person's knowledge of and familiarity with the particular subject and who, in
each of the above cases, shall have direct responsibility for the administration
of this Agreement.
"Sale Price" of any securities distributed in a Spin-Off on
any Trading Day means the closing sale price per share (or, if no closing sale
price is reported, the average of the bid and ask prices, or, if more than one
in either case, the average of the average bid and average ask prices) on such
Trading Day as reported in composite transactions for the principal U.S.
securities exchange on which such securities are traded, or, if such securities
are not listed on a U.S. national or regional securities exchange, as reported
by the Nasdaq Stock Market, or, if such securities are not so reported, the last
quoted bid price for such securities in the over-the-counter market as reported
by the National Quotation Bureau or similar organization, or, if such bid price
is not available, the market value of such securities on such date as determined
by a nationally recognized independent investment banking firm retained by the
Company for this purpose.
"Securities Act" means the Securities Act of 1933 and any
statute successor thereto, in each case as amended from time to time, and the
rules and regulations promulgated thereunder.
"Securities Intermediary" means U.S. Bank Trust National
Association, a national banking association, in its capacity as Securities
Intermediary under the Pledge Agreement, together with its successors in such
capacity.
"Senior Indebtedness" means indebtedness of any kind of the
Company unless the instrument under which such indebtedness is incurred
expressly provides that it is in parity or subordinate in right of payment to
the Contract Adjustment Payments.
"Separate Notes" has the meaning set forth in the Pledge
Agreement.
"Settlement Date" means any Early Settlement Date or Merger
Early Settlement Date or the Stock Purchase Date.
"Settlement Rate" has the meaning set forth in Section 5.1(a).
"Special Event" means either an Accounting Redemption Event or
a Tax Event.
"Special Event Redemption" means, if a Special Event shall
occur and be continuing, the redemption of the Notes, at the option of the
Company, in whole but not in part, on not less than 30 days' nor more than 60
days' prior written notice.
"Special Event Redemption Date" means the date upon which a
Special Event Redemption is to occur.
"Special Event Redemption Principal Amount" means (i) in the
case of a Special Event Redemption Date occurring prior to a successful
remarketing of the Notes pursuant to the provisions of Section 5.4, the
aggregate principal amount of Notes included in Normal Units outstanding on such
date, and (ii) in the case of a Special Event Redemption Date occurring after
either a successful remarketing of the Notes pursuant to the provisions of
Section 5.4 or the Stock Purchase Date, the aggregate principal amount of the
Notes outstanding on such date.
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"Spin-Off" means a dividend or other distribution on the
Ordinary Shares or shares of Capital Stock of any class or series, or similar
equity interests, of or relating to a subsidiary or other business unit of the
Company.
"Stated Amount" means, with respect to any one Normal Unit or
Stripped Unit, $25, and, with respect to any one Note,
$1,000.
"Stock Purchase Date" means May 15, 2007.
"Stripped Unit" means the collective rights and obligations of
a Holder of a Stripped Units Certificate in respect of a 1/40 undivided
beneficial interest in a Treasury Security, subject to the Pledge thereof, and
the related Purchase Contract.
"Stripped Units Certificate" means a certificate evidencing
the rights and obligations of a Holder in respect of the number of Stripped
Units specified on such certificate, substantially in the form of Exhibit B
hereto.
"Stripped Units Register" and "Stripped Units Registrar" have
the respective meanings set forth in Section 3.5(a).
"Subsequent Remarketing" has the meaning set forth in Section
5.4(b)(ii).
"Subsequent Remarketing Date" means any date during the
Remarketing Period on which the Remarketing Agent attempts a Subsequent
Remarketing.
"Tax Event" has the meaning set forth in Exhibit A of the
First Supplemental Indenture.
"Termination Date" means the date, if any, on which a
Termination Event occurs.
"Termination Event" means the occurrence of any of the
following events:
(i) at any time on or prior to the Stock Purchase Date, a
judgment, decree or court order shall have been entered granting relief
under any Bankruptcy Law or any other similar foreign, federal or state
law, adjudicating the Company to be insolvent, or approving as properly
filed a petition seeking reorganization or liquidation of the Company,
and, unless such judgment, decree or order shall have been entered
within 60 days prior to the Stock Purchase Date, such decree or order
shall have continued undischarged and unstayed for a period of 60 days;
(ii) except under Cayman Islands law, at any time on or prior
to the Stock Purchase Date, a judgment, decree or court order for the
appointment of a custodian, receiver or liquidator or trustee or
assignee in bankruptcy or insolvency of the Company or of its property
substantially in its entirety, or for the winding up or liquidation of
its affairs, shall have been entered, and, unless such judgment, decree
or order shall have been entered within 60 days prior to the Stock
Purchase Date, such judgment, decree or order shall have continued
undischarged and unstayed for a period of 60 days; or
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(iii) at any time on or prior to the Stock Purchase Date, the
Company shall file a petition for relief under any Bankruptcy Law or
any other similar foreign, federal or state law, or shall consent to
the filing of a bankruptcy proceeding against it, or shall file a
petition or answer or consent seeking reorganization or liquidation
under any Bankruptcy Law or any other similar foreign, federal or state
law, or shall consent to the filing of any such petition, or shall
consent to the appointment of a custodian, receiver or liquidator or
trustee or assignee in bankruptcy or insolvency of it or of its
property substantially in its entirety, or shall make an assignment for
the benefit of creditors, or shall admit in writing its inability to
pay its debts generally as they become due; or
(iv) at any time on or prior to the Stock Purchase Date, a
judgment, decree or court order for the appointment of a receiver or
liquidator or trustee or assignee in bankruptcy or insolvency of the
Company or of its property under any Bankruptcy Law of the Cayman
Islands, or for the termination or liquidation of the affairs of the
Company on its bankruptcy or insolvency, shall have been entered and if
such judgment, decree or order shall have been entered more than 60
days prior to the Stock Purchase Date, such judgment, decree or order
shall have continued undischarged and unstayed for a period of 60 days.
"Threshold Appreciation Price" has the meaning set forth in
Section 5.1(a)(i).
"TIA" means the Trust Indenture Act of 1939, and any statute
successor thereto, in each case as amended from time to time, and the rules and
regulations promulgated thereunder.
"Trading Day" has the meaning set forth in Section 5.1(c).
"Treasury Consideration" means, with respect to a Normal Unit,
(A) a 1/40, or 2.5%, undivided beneficial ownership interest in a $1,000
principal or interest amount of a principal or interest strip in a U.S. Treasury
security included in the Treasury Portfolio which matures on or prior to the
Stock Purchase Date and (B) for each scheduled interest Payment Date on the
Notes that occurs after the Special Event Redemption Date and on or before the
Stock Purchase Date, a ___% undivided beneficial ownership interest in a $1,000
principal or interest amount of a principal or interest strip in a U.S. Treasury
security included in the Treasury Portfolio that matures on or prior to that
interest Payment Date.
"Treasury Portfolio" means (i) if a Special Event Redemption
occurs prior to a successful remarketing of the Notes pursuant to the provisions
of Section 5.4, a portfolio of (A) zero-coupon U.S. Treasury securities
consisting of principal or interest strips of U.S. Treasury securities that
mature on or prior to the Stock Purchase Date in an aggregate amount equal to
the applicable Special Event Redemption Principal Amount and (B) with respect to
each scheduled interest Payment Date on the Notes that occurs after the Special
Event Redemption Date and on or before the Stock Purchase Date, interest or
principal strips of U.S. Treasury securities that mature on or prior to such
interest Payment Date in an aggregate amount equal to the aggregate interest
payment that would be due on the applicable Special Event Redemption Principal
Amount on such date if the interest rate of the Notes were not reset on the
Reset Date, and (ii) solely for purposes of determining the Treasury Portfolio
Purchase Price in the case of a Special
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Event Redemption Date occurring after the successful remarketing of the Notes
pursuant to the provisions of Section 5.4 or the Stock Purchase Date, a
portfolio of (A) zero-coupon U.S. Treasury securities consisting of principal or
interest strips of U.S. Treasury securities that mature on or prior to May 15,
2009 in an aggregate amount equal to the applicable Special Event Redemption
Principal Amount and (B) with respect to each scheduled interest Payment Date on
the Notes that occurs after the Special Event Redemption Date and on or before
May 15, 2009, interest or principal strips of U.S. Treasury securities that
mature on or prior to such interest Payment Date in an aggregate amount equal to
the aggregate interest payment that would be due on the applicable Special Event
Redemption Principal Amount of the Notes outstanding on the Special Event
Redemption Date.
"Treasury Portfolio Purchase Price" means the lowest aggregate
price quoted by a primary U.S. government securities dealer in New York City to
the Quotation Agent on the third Business Day immediately preceding the Special
Event Redemption Date for the purchase of the Treasury Portfolio for settlement
on the Special Event Redemption Date.
"Treasury Security" means a zero-coupon U.S. Treasury security
(CUSIP Number 000000XX0) maturing on May 15, 2007 that will pay $1,000 on such
maturity date.
"Trustee" means U.S. Bank National Association, a national
banking association, as trustee under the Indenture and the First Supplemental
Indenture, or any successor thereto.
"Underwriting Agreement" means the Underwriting Agreement
relating to the Units dated March 17, 2004 between the Company and the
underwriters named therein.
"Unit" means a Normal Unit or a Stripped Unit.
"Vice-President" means any vice-president, whether or not
designated by a number or a word or words added before or after the title
"vice-president."
SECTION 1.2. COMPLIANCE CERTIFICATES AND OPINIONS.
Except as otherwise expressly provided by this Agreement, upon
any application or request by the Company to the Agent to take any action under
any provision of this Agreement, the Company shall furnish to the Agent an
Officers' Certificate stating that all conditions precedent, if any, provided
for in this Agreement relating to the proposed action have been complied with
and, if requested by the Agent, an Opinion of Counsel stating that, in the
opinion of such counsel, such action is authorized or permitted by this
Agreement and that all such conditions precedent, if any, have been complied
with, except that in the case of any such application or request as to which the
furnishing of such documents is specifically required by any provision of this
Agreement relating to such particular application or request, no additional
certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement shall include:
(a) a statement that the individual signing such certificate
or opinion has read such covenant or condition and the definitions herein
relating thereto;
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(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;
(c) a statement that, in the opinion of such individual, he or
she has made such examination or investigation as is necessary to enable such
individual to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(d) a statement as to whether, in the opinion of such
individual based on his or her knowledge, such condition or covenant has been
complied with.
SECTION 1.3. FORM OF DOCUMENTS DELIVERED TO AGENT. (a) In any case
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
(b) Any certificate or opinion of an officer of the Company
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate or Opinion of Counsel may
be based, insofar as it relates to factual matters, upon a certificate or
opinion of, or representations by, an officer or officers of the Company stating
that the information with respect to such factual matters is in the possession
of the Company unless such counsel knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Agreement, they may, but need not, be consolidated
and form one instrument.
SECTION 1.4. ACTS OF HOLDERS; RECORD DATES. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Agreement to be given or taken by Holders may be embodied in and evidenced
by one or more instruments of substantially similar tenor signed by such Holders
in person or by an agent duly appointed in writing; and, except as herein
otherwise expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Agent and, where it is hereby
expressly required, to the Company. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Agreement and (subject to Section 7.1)
conclusive in favor of the Agent and the Company, if made in the manner provided
in this Section.
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(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved in any manner which the Agent deems
sufficient.
(c) The ownership of Units shall be proved by the Normal Units
Register or the Stripped Units Register, as the case may be.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Certificate shall bind every
future Holder of the same Certificate and the Holder of every Certificate issued
upon the registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered to be done by the Agent
or the Company in reliance thereon, whether or not notation of such action is
made upon such Certificate.
(e) The Company may set any day as a record date for the
purpose of determining the Holders of Outstanding Units entitled to give, make
or take any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Agreement to be given, made or
taken by Holders of Units. If any record date is set pursuant to this paragraph,
the Holders of the Outstanding Normal Units and the Outstanding Stripped Units,
as the case may be, on such record date, and no other Holders, shall be entitled
to take the relevant action with respect to the Normal Units or the Stripped
Units, as the case may be, whether or not such Holders remain Holders after such
record date; provided that no such action shall be effective hereunder unless
taken on or prior to the applicable Expiration Date by Holders of the requisite
number of Outstanding Units on such record date. Nothing in this paragraph shall
be construed to prevent the Company from setting a new record date for any
action for which a record date has previously been set pursuant to this
paragraph (whereupon the record date previously set shall automatically and with
no action by any Person be cancelled and of no effect), and nothing in this
paragraph shall be construed to render ineffective any action taken by Holders
of the requisite number of Outstanding Units on the date such action is taken.
Promptly after any record date is set pursuant to this paragraph, the Company,
at its own expense, shall cause notice of such record date, the proposed action
by Holders and the applicable Expiration Date to be given to the Agent in
writing and to each Holder of Units in the manner set forth in Section 1.6.
(f) With respect to any record date set pursuant to this
Section, the Company may designate any date as the "Expiration Date" and from
time to time may change the Expiration Date to any earlier or later day;
provided that no such change shall be effective unless notice of the proposed
new Expiration Date is given to the Agent in writing, and to each Holder of
Units in the manner set forth in Section 1.6, on or prior to the existing
Expiration Date. If an Expiration Date is not designated with respect to any
record date set pursuant to this Section, the Company shall be deemed to have
initially designated the 180th day after such record date as the Expiration Date
with respect thereto, subject to its right to change the Expiration Date as
provided in this paragraph. Notwithstanding the foregoing, no Expiration Date
shall be later than the 180th day after the applicable record date.
SECTION 1.5. NOTICES. Any request, demand, authorization, direction,
notice, consent, waiver or Act of Holders or other document provided or
permitted by this Agreement to be made upon, given or furnished to, or filed
with:
16
(a) the Agent by any Holder or by the Company shall be
sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if made, given, furnished or filed in writing and personally
delivered, mailed, first-class postage prepaid, telecopied or delivered by
overnight air courier guaranteeing next day delivery, addressed to and received
by the Agent at 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000,
[Attention: __________________], [telecopy: (___) ___-____], or at any other
address furnished in writing by the Agent to the Holders and the Company; or
(b) the Company by the Agent or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if made, given, furnished or filed in writing and personally
delivered, mailed, first-class postage prepaid, telecopied or delivered by
overnight air courier guaranteeing at least second day delivery, addressed to
and received by the Company at XL Capital Ltd, XX Xxxxx, Xxx Xxxxxxxxxx Xxxx,
Xxxxxxxx XX00, Xxxxxxx Xxxxxxxxx: ____________________________________,
telecopy: (___) ___-____, or at any other address furnished in writing to the
Agent by the Company; or
(c) the Collateral Agent by the Agent, the Company or any
Holder shall be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing and personally
delivered, mailed, first-class postage prepaid, telecopied or delivered by
overnight air courier guaranteeing next day delivery, addressed to and received
by the Collateral Agent at 000 Xxxxxx Xxxxxx, 00xx Xxxxx, Xxxxxxxx, Xxxxxxxxxxx
00000, [Attention: __________________], [telecopy: (___) ___-____], or at any
other address furnished in writing by the Collateral Agent to the Agent, the
Company and the Holders; or
(d) the Trustee by the Company shall be sufficient for every
purpose hereunder (unless otherwise herein expressly provided) if made, given,
furnished or filed in writing and personally delivered, mailed, first-class
postage prepaid, telecopied or delivered by overnight air courier guaranteeing
next day delivery, addressed to and received by the Trustee at 000 Xxxxxx
Xxxxxx, 00xx Xxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000, [Attention:
__________________], [telecopy: (___) ___-____], or at any other address
furnished in writing by the Trustee to the Company.
SECTION 1.6. NOTICE TO HOLDERS; WAIVER. (a) Where this Agreement
provides for notice to Holders of any event, such notice shall be sufficiently
given (unless otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, to each Holder affected by such event, at its
address as it appears in the applicable Register, not later than the latest
date, and not earlier than the earliest date, prescribed for the giving of such
notice. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Where this Agreement provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with the Agent, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
(b) In case by reason of the suspension of regular mail
service or by reason of any other cause it shall be impracticable to give such
notice by mail, then such notification as shall be made with the approval of the
Agent shall constitute a sufficient notification for every purpose hereunder.
17
SECTION 1.7. EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of
Contents are for convenience only and shall not affect the construction hereof.
SECTION 1.8. SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Agreement by the Company
shall bind its successors and assigns, whether so expressed or not.
SECTION 1.9. SEPARABILITY CLAUSE.
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 1.10. BENEFITS OF AGREEMENT.
Nothing in this Agreement or in the Units, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and, to the extent provided hereby, the Holders, any benefits or any
legal or equitable right, remedy or claim under this Agreement. The Holders from
time to time shall be beneficiaries of this Agreement and shall be bound by all
of the terms and conditions hereof and of the Units evidenced by their
Certificates by their acceptance of delivery of such Certificates.
SECTION 1.11. GOVERNING LAW.
This Agreement and the Units shall be governed by, deemed to
be a contract under, and construed in accordance with, the laws of the State of
New York. The Company, the Agent and the Holders from time to time of the Units,
acting through the Agent as their attorney-in-fact, hereby submit to the
nonexclusive jurisdiction of the United States District Court for the Southern
District of New York and of any New York state court sitting in the Borough of
Manhattan in New York City for the purposes of all legal proceedings arising out
of or relating to this Agreement or the transactions contemplated hereby. The
Company, the Agent and the Holders from time to time of the Units, acting
through the Agent as their attorney-in-fact, irrevocably waive, to the fullest
extent permitted by applicable law, any objection which they may now or
hereafter have to the laying of the venue of any such proceeding brought in such
a court and any claim that any such proceeding brought in such a court has been
brought in an inconvenient forum. The Company hereby designates and appoints CT
Corporation System, 000 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 as its
authorized agent upon which process may be served in any legal suit, action or
proceeding arising out of or relating to this Agreement which may be instituted
in any federal or state court in the Borough of Manhattan, The City of New
18
York, New York, and agrees that service of process upon such agent, and written
notice of said service to the Company by the Person serving the same, shall be
deemed in every respect effective service of process upon the Company in any
such suit, action or proceeding and further designates its domicile, the
domicile of CT Corporation System specified above and any domicile CT
Corporation System may have in the future as its domicile to receive any notice
hereunder (including service of process). If for any reason CT Corporation
System (or any successor agent for this purpose) shall cease to act as agent for
service of process as provided above, the Company will promptly appoint a
successor agent for this purpose reasonably acceptable to the Agent. The Company
agrees to take any and all actions as may be necessary to maintain such
designation and appointment of such agent in full force and effect.
SECTION 1.12. JUDGMENT CURRENCY. The Company agrees, to the fullest
extent that it may effectively do so under applicable law, that (a) if for the
purpose of obtaining judgment in any court it is necessary to convert the sum
due (the "Required Currency") into a currency in which a judgment will be
rendered (the "Judgment Currency"), the rate of exchange used shall be the rate
at which in accordance with normal banking procedures the Agent could purchase
in The City of New York the requisite amount of the Required Currency with the
Judgment Currency on the New York Banking Day preceding the day on which a final
unappealable judgment is given and (b) its obligations under this Agreement to
make payments in the Required Currency (i) shall not be discharged or satisfied
by any tender, or any recovery pursuant to any judgment (whether or not entered
in accordance with clause (a)), in any currency other than the Required
Currency, except to the extent that such tender or recovery shall result in the
actual receipt, by the payee, of the full amount of the Required Currency
expressed to be payable in respect of such payments, (ii) shall be enforceable
as an alternative or additional cause of action for the purpose of recovering in
the Required Currency the amount, if any, by which such actual receipt shall
fall short of the full amount of the Required Currency so expressed to be
payable and (iii) shall not be affected by judgment being obtained for any other
sum due under this Agreement. For purpose of the foregoing, "New York Banking
Day" means any day except a Saturday, Sunday or a legal holiday in The City of
New York or a day on which banking institutions in The City of New York are
authorized or obligated by law, regulation or executive order to be closed.
SECTION 1.13. LEGAL HOLIDAYS. (a) In any case where any Payment Date
shall not be a Business Day, then (notwithstanding any other provision of this
Agreement or the Normal Units Certificates) payments on the Units shall not be
made on such date, but such payments shall be made on the next succeeding day
which is a Business Day with the same force and effect as if made on such
Payment Date, provided that no interest shall accrue or be payable by the
Company in respect of such payment for the period from and after any such
Payment Date, except that if such next succeeding Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day with the same force and effect as if made on such Payment
Date.
(b) If any date on which Contract Adjustment Payments are to
be made on the Purchase Contracts is not a Business Day, then payment of the
Contract Adjustment Payments payable on that date will be made on the next
succeeding day which is a Business Day, and no interest or additional payment
will be paid in respect of the delay. However, if that Business Day
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is in the next succeeding calendar year, the payment will be made on the
immediately preceding Business Day with the same force and effect as if made on
that Payment Date.
(c) In any case where the Stock Purchase Date shall not be a
Business Day, then (notwithstanding any other provision of this Agreement or the
Certificates) the Purchase Contracts shall not be performed on such date, but
the Purchase Contracts shall be performed on the next succeeding day which is a
Business Day with the same force and effect as if performed on the Stock
Purchase Date.
SECTION 1.14. 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 1.15. INSPECTION OF AGREEMENT.
A copy of this Agreement shall be available at all reasonable
times during normal business hours at the Corporate Trust Office for inspection
by any Holder.
SECTION 1.16. APPOINTMENT OF FINANCIAL INSTITUTION AS AGENT FOR THE
COMPANY.
The Company may appoint a financial institution (which may be
the Collateral Agent) to act as its agent in performing its obligations and in
accepting and enforcing performance of the obligations of the Agent and the
Holders, under this Agreement and the Purchase Contracts, by giving notice of
such appointment in the manner provided in Section 1.5 hereof. Any such
appointment shall not relieve the Company in any way from its obligation
hereunder.
SECTION 1.17. NO WAIVER.
No failure on the part of the Company, the Agent, the
Collateral Agent, the Securities Intermediary or any of their respective agents
to exercise, and no course of dealing with respect to, and no delay in
exercising, any right, power or remedy hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise by the Company, the Agent, the
Collateral Agent, the Securities Intermediary or any of their respective agents
of any right, power or remedy hereunder preclude any further exercise thereof or
the exercise of any right, power or remedy. The remedies herein are cumulative
and are not exclusive of any remedies provided by law.
ARTICLE II
CERTIFICATE FORMS
SECTION 2.1. FORMS OF CERTIFICATES GENERALLY. (a) The Normal Units Certificates
(including the form of Purchase Contract forming part of the Normal Units
evidenced thereby) shall be in substantially the form set forth in Exhibit A
hereto, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or
20
engraved thereon as may be required by the rules of any securities exchange or
quotation system on which the Normal Units are listed or quoted for trading or
any depositary therefor, or as may, consistently herewith, be determined by the
officers of the Company executing such Normal Units Certificates, as evidenced
by their execution of the Normal Units Certificates.
(b) The definitive Normal Units Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers of the Company executing such
Normal Units Certificates, consistent with the provisions of this Agreement, as
evidenced by their execution thereof.
(c) The Stripped Units Certificates (including the form of
Purchase Contracts forming part of the Stripped Units evidenced thereby) shall
be in substantially the form set forth in Exhibit B hereto, with such letters,
numbers or other marks of identification or designation and such legends or
endorsements printed, lithographed or engraved thereon as may be required by the
rules of any securities exchange or the quotation system on which the Stripped
Units may be listed or quoted for trading or any depositary therefor, or as may,
consistently herewith, be determined by the officers of the Company executing
such Stripped Units Certificates, as evidenced by their execution of the
Stripped Units Certificates.
(d) The definitive Stripped Units Certificates shall be
printed, lithographed or engraved on steel engraved borders or may be produced
in any other manner, all as determined by the officers of the Company executing
such Stripped Units Certificates, consistent with the provisions of this
Agreement, as evidenced by their execution thereof.
(e) Every Global Certificate authenticated, executed on behalf
of the Holders and delivered hereunder shall bear a legend in substantially the
following form:
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT (AS DEFINED ON THE REVERSE HEREOF) AND IS
REGISTERED IN THE NAME OF THE CLEARING AGENCY OR A NOMINEE THEREOF.
THIS CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
CERTIFICATE REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE IN WHOLE OR
IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH
CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
[Unless this Certificate is presented by an authorized representative
of The Depository Trust Company (55 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx)
to the Company or its agent for registration of transfer, exchange or
payment, and any Certificate issued is registered in the name of Cede &
Co., or such other name as requested by an authorized representative of
The Depository Trust Company, and any payment hereon is made to Cede &
Co. or to such other entity as is requested by an authorized
representative of The Depository Trust Company, ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
since the registered owner hereof, Cede & Co., has an interest herein.]
21
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR CERTIFICATES
IN DEFINITIVE REGISTERED FORM IN THE LIMITED CIRCUMSTANCES REFERRED TO
IN THE PURCHASE CONTRACT AGREEMENT, THIS GLOBAL CERTIFICATE MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH
NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY."
SECTION 2.2. FORM OF AGENT'S CERTIFICATE OF AUTHENTICATION. (a) The
form of the Agent's certificate of authentication of the Normal Units shall be
in substantially the form set forth on the form of the Normal Units
Certificates.
(b) The form of the Agent's certificate of authentication of
the Stripped Units shall be in substantially the form set forth on the form of
the Stripped Units Certificates.
ARTICLE III
THE UNITS
SECTION 3.1. NUMBER OF UNITS; DENOMINATIONS. (a) The aggregate number
of Normal Units and Stripped Units, if any, evidenced by Certificates
authenticated, executed on behalf of the Holders and delivered hereunder is
limited to 30,000,000 (33,000,000 if the underwriters' option to purchase
additional Normal Units pursuant to the Underwriting Agreement is exercised in
full), except for Certificates authenticated, executed on behalf of the Holder
and delivered upon registration of transfer of, in exchange for, or in lieu of,
other Certificates pursuant to Section 3.4, 3.5, 3.10, 3.13, 3.14, 5.9(e),
5.10(e) or 8.5.
(b) The Certificates shall be issuable only in registered form
and only in denominations of a single Unit and any integral multiple thereof.
SECTION 3.2. RIGHTS AND OBLIGATIONS EVIDENCED BY THE CERTIFICATES. (a)
Each Normal Units Certificate shall evidence the number of Normal Units
specified therein, with each such Normal Unit representing the ownership by the
Holder thereof of a 1/40 undivided beneficial interest in a Note in the original
principal amount of $1,000 or the Treasury Consideration, as the case may be,
subject to the Pledge of such interest in such Note or the Treasury
Consideration, as the case may be, by such Holder pursuant to the Pledge
Agreement, and the rights and obligations of the Holder thereof and the Company
under one Purchase Contract. The Agent, as attorney-in-fact for, and on behalf
of, the Holder of each Normal Unit, shall pledge, pursuant to the Pledge
Agreement, the interest in such Note or the Treasury Consideration forming a
part of such Normal Unit, to the Collateral Agent and grant to the Collateral
Agent a security interest in the right, title, and interest of such Holder in
such interest in such Note or Treasury Consideration for the benefit of the
Company, to secure the obligation of such Holder under the related Purchase
Contract to purchase Ordinary Shares of the Company.
22
(b) Each Stripped Units Certificate shall evidence the number
of Stripped Units specified therein, with each such Stripped Unit representing
the ownership by the Holder thereof of a 1/40 undivided beneficial interest in a
Treasury Security, subject to the Pledge of such interest in such Treasury
Security by such Holder pursuant to the Pledge Agreement, and the rights and
obligations of the Holder thereof and the Company under one Purchase Contract.
The Agent, as attorney-in-fact for, and on behalf of, the Holder of each
Stripped Unit, shall pledge, pursuant to the Pledge Agreement, the interest in
the Treasury Security forming a part of such Stripped Unit, to the Collateral
Agent and grant to the Collateral Agent a security interest in the right, title,
and interest of such Holder in such interest in the Treasury Security for the
benefit of the Company, to secure the obligation of such Holder under the
related Purchase Contract to purchase Ordinary Shares of the Company.
(c) Prior to the purchase of Ordinary Shares under each
Purchase Contract, such Purchase Contract shall not entitle the Holder of the
related Units Certificates to any of the rights of a holder of Ordinary Shares,
including, without limitation, the right to vote or receive any dividends or
other payments or to consent or to receive notice as a shareholder in respect of
the meetings of shareholders or for the election of directors of the Company or
for any other matter, or any other rights whatsoever as a shareholder of the
Company.
SECTION 3.3. EXECUTION, AUTHENTICATION, DELIVERY AND DATING. (a)
Subject to the provisions of Sections 3.13 and 3.14, upon the execution and
delivery of this Agreement, and at any time and from time to time thereafter,
the Company may deliver Certificates executed by the Company to the Agent for
authentication, execution on behalf of the Holders and delivery, together with
its Issuer Order for authentication and delivery of such Certificates, and the
Agent in accordance with such Issuer Order shall authenticate, execute on behalf
of the Holders and deliver such Certificates.
(b) The Certificates shall be executed on behalf of the
Company by its Chairman of the Board of Directors, a Vice-Chairman, its
President or one of its Vice-Presidents, under its corporate seal reproduced
thereon, and attested by its Secretary or one of its Assistant Secretaries and
delivered to the Agent. The signature of any of these officers on the
Certificates may be manual or facsimile.
(c) Certificates bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Certificates
or did not hold such offices at the date of such Certificates.
(d) No Purchase Contract evidenced by a Certificate shall be
valid until such Certificate has been executed on behalf of the Holder by the
manual signature of an authorized officer of the Agent, as such Holder's
attorney-in-fact. Such signature by an authorized officer of the Agent shall be
conclusive evidence that the Holder of such Certificate has entered into the
Purchase Contract or Purchase Contracts evidenced by such Certificate.
(e) Each Certificate shall be dated the date of its
authentication.
23
(f) No Certificate shall be entitled to any benefit under this
Agreement or be valid or obligatory for any purpose unless there appears on such
Certificate a certificate of authentication substantially in the form provided
for herein executed by an authorized officer of the Agent by manual signature,
and such certificate upon any Certificate shall be conclusive evidence, and the
only evidence, that such Certificate has been duly authenticated and delivered
hereunder.
SECTION 3.4. TEMPORARY CERTIFICATES. (a) Pending the preparation of
definitive Certificates, the Company shall execute and deliver to the Agent, and
the Agent shall authenticate, execute on behalf of the Holders, and deliver, in
lieu of such definitive Certificates, temporary Certificates which are in
substantially the form set forth in Exhibit A or Exhibit B hereto, as the case
may be, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or engraved
thereon as may be required by the rules of any securities exchange on which the
Normal Units or Stripped Units, as the case may be, are listed or quoted for
trading or any depositary transfer, or as may, consistently herewith, be
determined by the officers of the Company executing such Certificates, as
evidenced by their execution of the Certificates.
(b) If temporary Certificates are issued, the Company will
cause definitive Certificates to be prepared without unreasonable delay. After
the preparation of definitive Certificates, the temporary Certificates shall be
exchangeable for definitive Certificates upon surrender of the temporary
Certificates at the Corporate Trust Office or such other office or agency
designated pursuant to Section 10.2 at the expense of the Company and without
charge to the Holder. Upon surrender for cancellation of any one or more
temporary Certificates, the Company shall execute and deliver to the Agent, and
the Agent shall authenticate, execute on behalf of the Holder, and deliver in
exchange therefor, one or more definitive Certificates of like tenor and
denominations and evidencing a like number of Normal Units or Stripped Units, as
the case may be, as the temporary Certificate or Certificates so surrendered.
Until so exchanged, the temporary Certificates shall in all respects evidence
the same benefits and the same obligations with respect to the Normal Units or
Stripped Units, as the case may be, evidenced thereby as definitive
Certificates.
SECTION 3.5. REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE.
(a) The Agent shall keep at the Corporate Trust Office a register (the
register maintained in such office or in any other office or agency designated
pursuant to Section 10.2 being herein referred to as "Normal Units Register") in
which, subject to such reasonable regulations as it may prescribe, the Agent
shall provide for the registration of Normal Units Certificates and of transfers
of Normal Units Certificates (the Agent, in such capacity, the "Normal Units
Registrar") and a register (the register maintained in such office or in any
other office or agency designated pursuant to Section 10.2 being herein referred
to as the "Stripped Units Register") in which, subject to such reasonable
regulations as it may prescribe, the Agent shall provide for the registration of
the Stripped Units Certificates and transfers of Stripped Units Certificates
(the Agent, in such capacity, the "Stripped Units Registrar").
(b) Upon surrender for registration of transfer of any Certificate at
the Corporate Trust Office or such office or agency designated pursuant to
Section 10.2, the Company shall
24
execute and deliver to the Agent, and the Agent shall authenticate, execute on
behalf of the designated transferee or transferees, and deliver one or more new
Certificates of like tenor and denominations, registered in the name of the
designated transferee or transferees, and evidencing a like number of Normal
Units or Stripped Units, as the case may be.
(c) At the option of the Holder, Certificates may be exchanged for
other Certificates, of like tenor and denominations and evidencing a like number
of Normal Units or Stripped Units, as the case may be, upon surrender of the
Certificates to be exchanged at such office or agency. Whenever any Certificates
are so surrendered for exchange, the Company shall execute and deliver to the
Agent, and the Agent shall authenticate, execute on behalf of the Holder, and
deliver the Certificates which the Holder making the exchange is entitled to
receive.
(d) All Certificates issued upon any registration of transfer or
exchange of a Certificate shall evidence the ownership of the same number of
Normal Units or Stripped Units, as the case may be, and be entitled to the same
benefits and subject to the same obligations, under this Agreement as the Normal
Units or Stripped Units, as the case may be, evidenced by the Certificate
surrendered upon such registration of transfer or exchange.
(e) Every Certificate presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company or the Agent) be
duly endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Agent duly executed by the Holder thereof or
its attorney duly authorized in writing.
(f) No service charge shall be made for any registration of transfer or
exchange of a Certificate, but the Company and the Agent may require payment
from the Holder of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Certificates, other than any exchanges pursuant to Sections 3.6, 3.9
and 8.5 not involving any transfer.
(g) Notwithstanding the foregoing, the Company shall not be obligated
to issue or execute and deliver to the Agent, and the Agent shall not be
obligated to authenticate, execute on behalf of the Holder and deliver, any
Certificate presented or surrendered for registration of transfer or for
exchange on or after the Business Day immediately preceding the earlier of the
Stock Purchase Date or the Termination Date. In lieu of delivery of a new
Certificate, upon satisfaction of the applicable conditions specified above in
this Section and receipt of appropriate registration or transfer instructions
from such Holder, the Agent shall,
(i) if the Stock Purchase Date has occurred, deliver the
Ordinary Shares issuable in respect of the Purchase Contracts forming a
part of the Units evidenced by such Certificate,
(ii) in the case of Normal Units, if a Termination Event
shall have occurred prior to the Stock Purchase Date, transfer the
Notes or the Treasury Consideration, as applicable, relating to such
Normal Units, or
(iii) in the case of Stripped Units, if a Termination Event
shall have occurred prior to the Stock Purchase Date, transfer the
Treasury Securities relating to such Stripped Xxxxx,
00
in each case subject to the applicable conditions and in accordance with the
applicable provisions of Article V.
SECTION 3.6. BOOK-ENTRY INTERESTS.
The Certificates, on original issuance, will be issued in the
form of one or more fully registered Global Certificates, to be delivered to the
Depositary or a nominee or custodian thereof by, or on behalf of, the Company.
Such Global Certificate shall initially be registered on the books and records
of the Company in the name of Cede & Co., the nominee of the Depositary, and no
Beneficial Owner will receive a definitive Certificate representing such
Beneficial Owner's interest in such Global Certificate, except as provided in
Section 3.9. The Agent shall enter into a customary agreement with the
Depositary if so requested by the Company. Unless and until definitive, fully
registered Certificates have been issued to Beneficial Owners pursuant to
Section 3.9:
(a) the provisions of this Section 3.6 shall be in full force
and effect;
(b) the Company and the Agent shall be entitled to deal with
the Clearing Agency for all purposes of this Agreement (including the payment of
Contract Adjustment Payments, if any, and receiving approvals, votes or consents
hereunder) as the Holder of the Units and the sole holder of the Global
Certificate(s) and shall have no obligation to the Beneficial Owners;
(c) to the extent that the provisions of this Section 3.6
conflict with any other provisions of this Agreement or any Certificate, the
provisions of this Section 3.6 shall control; and
(d) the rights of the Beneficial Owners shall be exercised
only through the Clearing Agency and shall be limited to those established by
law and agreements between such Beneficial Owners and the Clearing Agency and/or
the Clearing Agency Participants.
The Clearing Agency will make book-entry transfers among
Clearing Agency Participants and receive and transmit payments of Contract
Adjustment Payments to such Clearing Agency Participants.
SECTION 3.7. NOTICES TO HOLDERS.
Whenever a notice or other communication to the Holders is
required to be given under this Agreement, the Company or the Company's agent
shall give such notices and communications to the Holders and, with respect to
any Units registered in the name of a Clearing Agency or the nominee of a
Clearing Agency, the Company or the Company's agent shall, except as set forth
herein, have no obligations to the Beneficial Owners.
SECTION 3.8. APPOINTMENT OF SUCCESSOR CLEARING AGENCY.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Units or ceases to be eligible as a
"clearing agency" under the Exchange Act,
26
the Company may, in its sole discretion, appoint a successor Clearing Agency
with respect to the Units.
SECTION 3.9. DEFINITIVE CERTIFICATES.
If
(i) a Clearing Agency notifies the Company that it is
unwilling or unable to continue its services as securities
depositary with respect to the Units and a successor Clearing
Agency is not appointed within 90 days after such discontinuance
pursuant to Section 3.8,
(ii) the Company elects to terminate the book-entry system
arrangements through the Clearing Agency with respect to the
Units, or
(iii) there shall have occurred and be continuing a default
by the Company in respect of its obligations under this Agreement
or the Indenture governing the Notes,
then, upon surrender of the Global Certificates representing the Book-Entry
Interests with respect to the Units by the Clearing Agency, accompanied by
registration instructions, the Company shall cause definitive Certificates to be
delivered to Beneficial Owners in accordance with the instructions of the
Clearing Agency. The Company shall not be liable for any delay in delivery of
such instructions and may conclusively rely on and shall be protected in relying
on, such instructions.
SECTION 3.10. MUTILATED, DESTROYED, LOST AND STOLEN CERTIFICATES. (a)
If any mutilated Certificate is surrendered to the Agent, the Company shall
execute and deliver to the Agent, and the Agent shall authenticate, execute on
behalf of the Holder, and deliver in exchange therefor, a new Certificate at the
cost of the Holder, evidencing the same number of Normal Units or Stripped
Units, as the case may be, and bearing a Certificate number not
contemporaneously outstanding.
(b) If there shall be delivered to the Company and the Agent
(i) evidence to their satisfaction of the destruction, loss or theft of any
Certificate, and (ii) such security or indemnity at the cost of the Holder as
may be required by them to hold each of them and any agent of either of them
harmless, then, in the absence of notice to the Company or to a Responsible
Officer of the Agent that such Certificate has been acquired by a protected
purchaser, the Company shall execute and deliver to the Agent, and the Agent
shall authenticate, execute on behalf of the Holder, and deliver to the Holder,
in lieu of any such destroyed, lost or stolen Certificate, a new Certificate,
evidencing the same number of Normal Units or Stripped Units, as the case may
be, and bearing a Certificate number not contemporaneously outstanding.
(c) Notwithstanding the foregoing, the Company shall not be
obligated to execute and deliver to the Agent, and the Agent shall not be
obligated to authenticate, execute on behalf of the Holder, and deliver to the
Holder, a Certificate on or after the fifth Business Day immediately preceding
the earlier of the Stock Purchase Date or the Termination Date. In lieu of
delivery of a new Certificate, upon satisfaction of the applicable conditions
specified above in
27
this Section and receipt of appropriate registration or transfer instructions
from such Holder, the Agent shall
(i) if the Stock Purchase Date has occurred, deliver the
Ordinary Shares issuable in respect of the Purchase Contracts
forming a part of the Units evidenced by such Certificate,
(ii) in the case of Normal Units, if a Termination Event
shall have occurred prior to the Stock Purchase Date, transfer the
Notes or the Treasury Consideration, as applicable, relating to
such Normal Units, or
(iii) in the case of Stripped Units, if a Termination Event
shall have occurred prior to the Stock Purchase Date, transfer the
Treasury Securities relating to such Stripped Units,
in each case subject to the applicable conditions and in accordance with the
applicable provisions of Article V.
(d) Upon the issuance of any new Certificate under this
Section, the Company and the Agent may require the payment by the Holder of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in relation thereto and any other expenses (including the fees and expenses of
the Agent) connected therewith.
(e) Every new Certificate issued pursuant to this Section in
lieu of any destroyed, lost or stolen Certificate shall constitute an original
additional contractual obligation of the Company and of the Holder in respect of
the Unit evidenced thereby, whether or not the destroyed, lost or stolen
Certificate (and the Units evidenced thereby) shall be at any time enforceable
by anyone, and shall be entitled to all the benefits and be subject to all the
obligations of this Agreement equally and proportionately with any and all other
Certificates delivered hereunder.
(f) The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Certificates.
SECTION 3.11. PERSONS DEEMED OWNERS.
(a) Prior to due presentment of a Certificate for registration
of transfer, the Company and the Agent, and any agent of the Company or the
Agent, may treat the Person in whose name such Certificate is registered on the
Register as the owner of the Units evidenced thereby, for the purpose of
receiving quarterly payments on the Notes or Treasury Consideration, receiving
payment of Contract Adjustment Payments, if any, and any Deferred Contract
Adjustment Payments, performance of the Purchase Contracts and for all other
purposes whatsoever, whether or not any such payments shall be overdue and
notwithstanding any notice to the contrary, and neither the Company nor the
Agent, nor any agent of the Company or the Agent, shall be affected by notice to
the contrary.
28
(b) Notwithstanding the foregoing, with respect to any Global
Certificate, nothing herein shall prevent the Company, the Agent or any agent of
the Company or the Agent, from treating the Clearing Agency as the sole Holder
of such Global Certificate or from giving effect to any written certification,
proxy or other authorization furnished by any Clearing Agency (or its nominee),
as a Holder of such Global Certificate, with respect to such Global Certificate
or impair, as between such Clearing Agency and owners of beneficial interests in
such Global Certificate, the operation of customary practices governing the
exercise of rights of such Clearing Agency (or its nominee) as a Holder of such
Global Certificate.
SECTION 3.12. CANCELLATION. (a) All Certificates surrendered (i) for
delivery of Ordinary Shares on or after any Settlement Date; (ii) upon the
transfer of Notes or Treasury Consideration or Treasury Securities, as the case
may be, after the occurrence of a Termination Event or pursuant to an Early
Settlement or Merger Early Settlement, or a Collateral Substitution or an
establishment or re-establishment of a Normal Unit; or (iii) upon the
registration of a transfer or exchange of a Unit shall, if surrendered to any
Person other than the Agent, be delivered to the Agent and, if not already
cancelled, shall be promptly cancelled by it. The Company may at any time
deliver to the Agent for cancellation any Certificates previously authenticated,
executed on behalf of the Holder and delivered hereunder which the Company may
have acquired in any manner whatsoever, and all Certificates so delivered shall,
upon Issuer Order, be promptly cancelled by the Agent. No Certificates shall be
authenticated, executed on behalf of the Holder and delivered in lieu of or in
exchange for any Certificates cancelled as provided in this Section, except as
expressly permitted by this Agreement. All cancelled Certificates held by the
Agent shall be disposed of by the Agent in accordance with its then customary
procedures.
(b) If the Company or any Affiliate of the Company shall
acquire any Certificate, such acquisition shall not operate as a cancellation of
such Certificate unless and until such Certificate is cancelled or delivered to
the Agent for cancellation.
SECTION 3.13. ESTABLISHMENT OF STRIPPED UNITS. (a) A Holder may
separate the Pledged Notes or Pledged Treasury Consideration, as applicable,
from the related Purchase Contracts in respect of the Normal Units held by such
Holder by substituting for such Pledged Notes or Pledged Treasury Consideration,
as the case may be, Treasury Securities that will pay at the Stock Purchase Date
an amount equal to the aggregate Stated Amount of such Normal Units (a
"Collateral Substitution"), at any time from and after the date of this
Agreement and on or prior to the thirteenth Business Day immediately preceding
the Stock Purchase Date, by (i) depositing with the Collateral Agent Treasury
Securities having an aggregate principal amount equal to the aggregate Stated
Amount of such Normal Units, and (ii) transferring the related Normal Units to
the Agent accompanied by a notice to the Agent, substantially in the form of
Exhibit D hereto, stating that the Holder has transferred the relevant amount of
Treasury Securities to the Collateral Agent and requesting that the Agent
instruct the Collateral Agent to release the Pledged Notes or Pledged Treasury
Consideration, as the case may be, underlying such Normal Units, whereupon the
Agent shall promptly give such instruction to the Collateral Agent,
substantially in the form of Exhibit C hereto. Upon receipt of the Treasury
Securities described in clause (i) above and the instruction described in clause
(ii) above, in accordance with the terms of the Pledge Agreement, the Collateral
Agent will release to the Agent, on behalf of the Holder, such Pledged Notes or
Pledged Treasury Consideration from the Pledge, free and
29
clear of the Company's security interest therein, and upon receipt thereof the
Agent shall promptly:
(x) cancel the related Normal Units Certificate;
(y) transfer the Pledged Notes or Pledged Treasury
Consideration, as the case may be, to the Holder; and
(z) authenticate, execute on behalf of such Holder and deliver
a Stripped Units Certificate executed by the Company in
accordance with Section 3.3 evidencing the same number of
Purchase Contracts as were evidenced by the cancelled Normal
Units.
(b) Holders who elect to separate the Pledged Notes or Pledged
Treasury Consideration, as the case may be, from the related Purchase Contract
and to substitute Treasury Securities for such Pledged Notes or Pledged Treasury
Consideration shall be responsible for any fees or expenses payable to the
Collateral Agent for its services as Collateral Agent in respect of the
substitution, and the Company shall not be responsible for any such fees or
expenses.
(c) Holders may make Collateral Substitutions (i) if Treasury
Securities are being substituted for Pledged Notes, only in integral multiples
of 40 Normal Units, or (ii) if the Collateral Substitutions occur after a
Special Event Redemption, as the case may be, only in integral multiples of
Normal Units such that the Treasury Securities to be deposited and the Treasury
Consideration to be released are in integral multiples of $1,000.
(d) In the event a Holder making a Collateral Substitution
pursuant to this Section 3.13 fails to effect a book-entry transfer of the
Normal Units or fails to deliver a Normal Units Certificate to the Agent after
depositing Treasury Securities with the Collateral Agent, the Pledged Notes or
Pledged Treasury Consideration, as the case may be, constituting a part of such
Normal Units, and any distributions on such Pledged Notes or Pledged Treasury
Consideration shall be held in the name of the Agent or its nominee in trust for
the benefit of such Holder, until such Normal Units are so transferred or the
Normal Units Certificate is so delivered, as the case may be, or, with respect
to a Normal Units Certificate, such Holder provides evidence satisfactory to the
Company and the Agent that such Normal Units Certificate has been destroyed,
lost or stolen, together with any indemnity that may be required by the Agent
and the Company.
(e) Except as described in this Section 3.13, for so long as
the Purchase Contract underlying a Normal Unit remains in effect, such Normal
Unit shall not be separable into its constituent parts, and the rights and
obligations of the Holder of such Normal Unit in respect of the Pledged Note or
the Pledged Treasury Consideration, as the case may be, and the Purchase
Contract comprising such Normal Unit may be acquired, and may be transferred and
exchanged, only as a Normal Unit.
SECTION 3.14. REESTABLISHMENT OF NORMAL UNITS. (a) A Holder of Stripped
Units may reestablish Normal Units at any time from and after the date of this
Agreement and on or prior to the thirteenth Business Day immediately preceding
the Stock Purchase Date, by (i) depositing with the Collateral Agent Notes in a
principal amount or the Treasury Consideration (identified
30
and calculated by reference to the Treasury Consideration then comprising Normal
Units), as the case may be, then comprising such number of Normal Units as is
equal to the number of such Stripped Units; and
(ii) transferring such Stripped Units to the Agent accompanied
by a notice to the Agent, substantially in the form of Exhibit D hereto, stating
that the Holder has transferred the relevant principal amount of Notes or the
Treasury Consideration, as the case may be, to the Collateral Agent and
requesting that the Agent instruct the Collateral Agent to release the Pledged
Treasury Securities underlying such Stripped Unit, whereupon the Agent shall
promptly give such instruction to the Collateral Agent, substantially in the
form of Exhibit C hereto. Upon receipt of the Notes or the Treasury
Consideration, as the case may be, described in clause (i) above and the
instruction described in clause (ii) above, in accordance with the terms of the
Pledge Agreement, the Collateral Agent will release to the Agent, on behalf of
the Holder, such Pledged Treasury Securities from the Pledge, free and clear of
the Company's security interest therein, and upon receipt thereof the Agent
shall promptly:
(x) cancel the related Stripped Units certificate;
(y) transfer the Pledged Treasury Securities to the Holder;
and
(z) authenticate, execute on behalf of such Holder and
deliver a Normal Units Certificate executed by the Company
in accordance with Section 3.3 evidencing the same number
of Purchase Contracts as were evidenced by the cancelled
Stripped Units.
(b) Holders of Stripped Units may reestablish Normal Units (i)
if Notes are being substituted for the Pledged Treasury Securities, only in
integral multiples of 40 Stripped Units for 40 Normal Units or (ii) if the
reestablishment occurs after a Special Event Redemption, as the case may be,
only in integral multiples of Stripped Units such that the Treasury
Consideration to be deposited and the Treasury Securities to be released are in
integral multiples of $1,000.
(c) Except as provided in this Section 3.14, for so long as
the Purchase Contract underlying a Stripped Unit remains in effect, such
Stripped Unit shall not be separable into its constituent parts, and the rights
and obligations of the Holder of such Stripped Unit in respect of the Pledged
Treasury Securities and Purchase Contract comprising such Stripped Unit may be
acquired, and may be transferred and exchanged, only as a Stripped Unit.
(d) In the event a Holder who reestablishes Normal Units
pursuant to this Section 3.14 fails to effect a book-entry transfer of the
Stripped Units or fails to deliver a Stripped Units Certificate to the Agent
after depositing Pledged Notes with the Collateral Agent, the Treasury
Securities constituting a part of such Stripped Units, and any distributions on
such Treasury Securities shall be held in the name of the Agent or its nominee
in trust for the benefit of such Holder, until such Stripped Units are so
transferred or the Stripped Units Certificate is so delivered, as the case may
be, or, with respect to a Stripped Units Certificate, such Holder provides
evidence satisfactory to the Company and the Agent that such Stripped Units
Certificate
31
has been destroyed, lost or stolen, together with any indemnity that may be
required by the Agent and the Company.
SECTION 3.15. TRANSFER OF COLLATERAL UPON OCCURRENCE OF TERMINATION
EVENT.
Upon the occurrence of a Termination Event and the transfer to
the Agent of the Notes or the Treasury Consideration or the Treasury Securities,
as the case may be, underlying the Normal Units and the Stripped Units pursuant
to the terms of the Pledge Agreement, the Agent shall request transfer
instructions with respect to such Notes or the Treasury Consideration or
Treasury Securities, as the case may be, from each Holder by written request
mailed to such Holder at its address as it appears in the Normal Units Register
or the Stripped Units Register, as the case may be. Upon book-entry transfer of
the Normal Units or Stripped Units or delivery of a Normal Units Certificate or
Stripped Units Certificate to the Agent with such transfer instructions, the
Agent shall transfer the Notes, the Treasury Consideration or the Treasury
Securities underlying such Normal Units or Stripped Units, as the case may be,
to such Holder by book-entry transfer, or other appropriate procedures, in
accordance with such instructions. In the event a Holder of Normal Units or
Stripped Units fails to effect such transfer or delivery, the Notes, the
Treasury Consideration or the Treasury Securities, as the case may be,
underlying such Normal Units or Stripped Units, as the case may be, and any
distributions thereon, shall be held in the name of the Agent or its nominee in
trust for the benefit of such Holder, until such Normal Units or Stripped Units
are transferred or the Normal Units Certificate or Stripped Units Certificate is
surrendered or such Holder provides satisfactory evidence that such Normal Units
Certificate or Stripped Units Certificate has been destroyed, lost or stolen,
together with any indemnity that may be required by the Agent and the Company.
In the case of the Treasury Portfolio or any Treasury Securities, the Agent may
dispose of the subject securities for cash and pay the applicable portion of
such cash to the Holders in lieu of such Holders' Treasury Securities, where
such Holder would otherwise have been entitled to receive less than $1,000 of
any such security.
SECTION 3.16. NO CONSENT TO ASSUMPTION.
Each Holder of a Unit, by acceptance thereof, shall be deemed
expressly to have withheld any consent to the assumption (i.e., affirmance),
under Section 365 of the Bankruptcy Code or otherwise, of the Purchase Contract
by the Company, any receiver, liquidator or person or entity performing similar
functions or its trustee in the event that the Company becomes the debtor under
the Bankruptcy Code or subject to other similar state or federal or other law
providing for reorganization or liquidation.
SECTION 3.17. CUSIP NUMBERS.
The Company in issuing the Units may use "CUSIP" numbers (if
then generally in use), and, if so, the Agent shall use "CUSIP" numbers in
notices to Holders as a convenience to Holders; provided that any such notice
may state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice to Holders and
that reliance may be placed only on the other identification numbers printed on
the Units, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Company will promptly notify the Agent of any
changes in the "CUSIP" numbers.
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SECTION 3.18. CURRENCY OF PAYMENTS. Any cash payments under this
Agreement shall be paid in U.S. dollars in immediately available funds.
ARTICLE IV
THE NOTES
SECTION 4.1. PAYMENT OF INTEREST; RIGHTS TO INTEREST PAYMENTS
PRESERVED; NOTICE. (a) A payment on any Note or Treasury Consideration, as the
case may be, which is paid on any Payment Date shall, subject to receipt thereof
by the Agent from the Collateral Agent (if the Collateral Agent is the
registered owner thereof) as provided by the terms of the Pledge Agreement, be
paid to the Person in whose name the Normal Units Certificate (or one or more
Predecessor Normal Units Certificates), of which such Note or the Treasury
Consideration is a part, is registered at the close of business on the Record
Date for such Payment Date.
(b) Each Normal Units Certificate evidencing Notes delivered
under this Agreement upon registration of transfer of or in exchange for or in
lieu of any other Normal Units Certificate shall carry the rights to interest
accrued and unpaid, and rights to accrue interest, which were carried by the
Notes or Treasury Consideration, as the case may be, underlying such other
Normal Units Certificate.
(c) In the case of any Normal Unit, with respect to which
Early Settlement of the underlying Purchase Contract is effected on an Early
Settlement Date, or with respect to which Merger Early Settlement of the
underlying Purchase Contract is effected on a Merger Early Settlement Date, or
with respect to which Cash Settlement is effected on or prior to the thirteenth
Business Day immediately preceding the Stock Purchase Date, or with respect to
which a Collateral Substitution is effected, in each case on a date that is
after any Record Date and on or prior to the next succeeding Payment Date,
payments on the Note or the Treasury Consideration, as the case may be,
underlying such Normal Unit otherwise payable on such Payment Date shall be
payable on such Payment Date notwithstanding such Early Settlement, Merger Early
Settlement, Cash Settlement or Collateral Substitution, as the case may be, and
such payments shall, subject to receipt thereof by the Agent, be payable to the
Person in whose name the Normal Units Certificate (or one or more Predecessor
Normal Unit Certificates) was registered at the close of business on such Record
Date. Except as otherwise expressly provided in the immediately preceding
sentence, in the case of any Normal Unit with respect to which Early Settlement,
Merger Early Settlement or Cash Settlement of the underlying Purchase Contract
is effected, or with respect to which a Collateral Substitution has been
effected, payments on the related Notes or payments on the Treasury
Consideration that would otherwise be payable after the applicable Settlement
Date or after such Collateral Substitution, as the case may be, shall not be
payable hereunder to the Holder of such Normal Unit; provided that, to the
extent that such Holder continues to hold the separated Notes that formerly
comprised a part of such Holder's Normal Units, such Holder shall be entitled to
receive any payments on such separated Notes.
SECTION 4.2. NOTICE AND VOTING.
The Agent will be entitled to exercise the voting and any
other consensual rights pertaining to the Pledged Notes but only to the extent
instructed in writing by the Holders as
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described below. Upon receipt of notice of any meeting at which holders of Notes
are entitled to vote or upon any solicitation of consents, waivers or proxies of
holders of Notes, the Agent shall, as soon as practicable thereafter, mail to
the Holders of Normal Units a notice prepared by the Company at the Company's
expense (a) containing such information as is contained in the notice or
solicitation, (b) stating that each Holder on the record date set by the Agent
therefor (which, to the extent possible, shall be the same date as the record
date for determining the holders of Notes entitled to vote) shall be entitled to
instruct the Agent as to the exercise of the voting rights pertaining to the
Pledged Notes underlying their Normal Units and (c) stating the manner in which
such instructions may be given. Upon the written request of any Holder of Normal
Units on such record date, the Agent shall endeavor insofar as practicable to
vote or cause to be voted, in accordance with the instructions set forth in such
request, the maximum number of Pledged Notes as to which any particular voting
instructions are received. In the absence of specific instructions from the
Holder of a Normal Unit, the Agent shall abstain from voting the Pledged Note
underlying such Normal Unit. The Company hereby agrees, if applicable, to
solicit Holders of Normal Units to timely instruct the Agent in writing in order
to enable the Agent to vote such Pledged Notes.
SECTION 4.3. SPECIAL EVENT REDEMPTION.
Upon the occurrence of a Special Event Redemption prior to the
successful remarketing of the Notes pursuant to the provisions of Section 5.4,
the Company shall instruct in writing the Collateral Agent to apply, and upon
such written instruction, the Collateral Agent shall apply, out of the aggregate
Redemption Price for the Notes that are components of Normal Units, an amount
equal to the Special Event Redemption Principal Amount to purchase on behalf of
the Holders of Normal Units the Treasury Portfolio and promptly remit the
remaining portion of such Redemption Price to the Agent for payment to the
Holders of such Normal Units. The Treasury Portfolio will be substituted for the
Pledged Notes, and will be pledged to the Collateral Agent in accordance with
the terms of the Pledge Agreement to secure the obligation of each Holder of a
Normal Unit to purchase the Ordinary Shares under the Purchase Contract
constituting a part of such Normal Unit. Following the occurrence of a Special
Event Redemption prior to a successful remarketing of the Notes pursuant to the
provisions of Section 5.4, the Holders of Normal Units and the Collateral Agent
shall have such security interests, rights and obligations with respect to the
Treasury Portfolio as the Holder of Normal Units and the Collateral Agent had in
respect of the Notes, as the case may be, subject to the Pledge thereof as
provided in Articles II, III, IV, V and VI of the Pledge Agreement, and any
reference herein or in the Certificates to the Note shall be deemed to be a
reference to such Treasury Portfolio and any reference herein or in the
Certificates to interest on the Notes shall be deemed to be a reference to
corresponding distributions on the Treasury Portfolio. The Company may cause to
be made in any Normal Unit Certificates thereafter to be issued such change in
phraseology and form (but not in substance) as may be appropriate to reflect the
substitution of the Treasury Portfolio for Notes as collateral.
The Company shall cause notice of any Special Event Redemption
to be mailed, at least 30 calendar days but not more than 60 calendar days
before such Special Event Redemption Date, to each Holder of Normal Units
including Notes to be redeemed at its registered address.
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Upon the occurrence of a Special Event Redemption after the
successful remarketing of the Notes or after the Stock Purchase Date, the
Redemption Price will be payable in cash to the holders of the Notes.
SECTION 4.4. CONSENT TO TREATMENT FOR TAX PURPOSES.
The Company and each Holder of a Normal Unit or a Stripped
Unit, by its acceptance thereof, covenants and agrees (a) to treat a Holder's
acquisition of the Normal Unit as the acquisition of the Note and Purchase
Contract constituting the Normal Unit, (b) to treat a Holder's acquisition of a
Stripped Unit as the acquisition of a Treasury Security and Purchase Contract
constituting the Stripped Unit, (c) to treat each Holder as the owner, for
federal, state and local income and franchise tax purposes of (i) the related
Notes or the Treasury Consideration, in the case of the Normal Units, or (ii)
the Treasury Securities, in the case of the Stripped Units, (d) to treat the
Notes as indebtedness of the Company for federal, state and local income and
franchise tax purposes and (e) to allocate 100% of the issue price of a Normal
Unit to the beneficial interest in the Note and 0.00% of the issue price to the
Purchase Contract.
ARTICLE V
THE PURCHASE CONTRACTS; THE REMARKETING
SECTION 5.1. PURCHASE OF ORDINARY SHARES. (a) Each Purchase Contract shall,
unless a Termination Event, an Early Settlement or a Merger Early Settlement
shall have occurred prior to the Stock Purchase Date, obligate the Holder of the
related Unit to purchase, and the Company to sell, on the Stock Purchase Date at
a price equal to $25 (the "Purchase Price"), a number of validly issued, fully
paid and non-assessable newly issued Ordinary Shares equal to the Settlement
Rate or, if we have fixed the Settlement Rate pursuant to Section 5.1(f), the
Fixed Settlement Rate. The "Settlement Rate" is equal to,
(i) if the Applicable Market Value (as defined below) is
equal to or greater than $93.99 (the "Threshold Appreciation
Price"), 0.2660 Ordinary Shares per Purchase Contract,
(ii) if the Applicable Market Value is less than the
Threshold Appreciation Price, but is greater than $75.19 (the
"Reference Price"), the number of Ordinary Shares per Purchase
Contract equal to the Purchase Price divided by the Applicable
Market Value, and
(iii) if the Applicable Market Value is equal to or less
than $75.19, 0.3325 Ordinary Shares per Purchase Contract,
in each case subject to adjustment as provided in Section 5.6 (and in each case
rounded upward or downward to the nearest 1/10,000th of a share).
(b) No fractional Ordinary Shares will be issued by the
Company with respect to the payment of Contract Adjustment Payments on the Stock
Purchase Date. In lieu of fractional shares otherwise issuable with respect to
such payment of Contract Adjustment Payments, the Holder will be entitled to
receive an amount in cash as provided in Section 5.12.
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(c) The "Applicable Market Value" means the average of the
Closing Price per Ordinary Share on each of the 20 consecutive Trading Days
ending on the third Trading Day immediately preceding the Stock Purchase Date
or, in the event of a Cash Merger, the Cash Merger Date. The "Closing Price" of
the Ordinary Shares on any date of determination means the closing sale price
(or, if no closing sale price is reported, the last reported sale price) of the
Ordinary Shares on the New York Stock Exchange (the "NYSE") on such date or, if
the Ordinary Shares are not listed for trading on the NYSE on any such date, as
reported in the composite transactions for the principal United States
securities exchange on which the Ordinary Shares are so listed, or if the
Ordinary Shares are not so listed on a United States securities exchange, as
reported by The Nasdaq Stock Market, or, if the Ordinary Shares are not so
reported, the last quoted bid price for the Ordinary Shares in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization, or, if such bid price is not available, the market value of the
Ordinary Shares on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the Company. A
"Trading Day" means a day on which the Ordinary Shares (A) are not suspended
from trading on any national or regional securities exchange or association or
over-the-counter market at the close of business and (B) have traded at least
once on the national or regional securities exchange or association or
over-the-counter market that is the primary market for the trading of the
Ordinary Shares at the close of business on such day.
(d) Each Holder of a Unit, by its acceptance thereof,
irrevocably authorizes the Agent to enter into and perform the related Purchase
Contract on its behalf as its attorney-in-fact (including the execution of
Certificates on behalf of such Holder), agrees to be bound by the terms and
provisions thereof, covenants and agrees to perform its obligations under such
Purchase Contract, consents to the provisions hereof, irrevocably authorizes the
Agent as its attorney-in-fact to enter into and perform the Pledge Agreement on
its behalf as its attorney-in-fact, and consents to and agrees to be bound by
the Pledge of the Notes, the Treasury Consideration or the Treasury Securities
pursuant to the Pledge Agreement; provided that upon a Termination Event, the
rights of the Holder of such Unit under the Purchase Contract may be enforced
without regard to any other rights or obligations. Each Holder of a Unit, by its
acceptance thereof, further covenants and agrees that, to the extent and in the
manner provided in Section 5.4 and the Pledge Agreement, but subject to the
terms thereof, payments in respect of the Pledged Notes, the Pledged Treasury
Consideration or the Pledged Treasury Securities to be paid upon settlement of
such Holder's obligations to purchase Ordinary Shares under the Purchase
Contract, shall be paid on the Stock Purchase Date by the Collateral Agent to
the Company in satisfaction of such Holder's obligations under such Purchase
Contract and such Holder shall acquire no right, title or interest in such
payments.
(e) Upon registration of transfer of a Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee) under the terms of this Agreement, the Purchase Contracts
underlying such Certificate and the Pledge Agreement, and the transferor shall
be released from the obligations under this Agreement, the Purchase Contracts
underlying the Certificate so transferred and the Pledge Agreement. The Company
covenants and agrees, and each Holder of a Certificate, by its acceptance
thereof, likewise covenants and agrees, to be bound by the provisions of this
paragraph.
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(f) If an Accounting Settlement Rate Event occurs and is
continuing at any time prior to the earlier of the date of any successful
remarketing of the Notes and the Stock Purchase Date, the Company may elect to
fix the Settlement Rate in accordance with the formula (the "Fixing Formula")
set forth on Exhibit F hereto (the new Settlement Rate referred to as the "Fixed
Settlement Rate"). If the Company elects to fix the Settlement Rate, the Company
must prepare and transmit to the Agent an Officers' Certificate setting forth
its intention to fix the Settlement Rate. Prior to 10:00 a.m., New York City
time, on the Business Day following the expiration of the 20 consecutive Trading
Day period commencing the third Trading Day following the date of such Officers'
Certificate, the Company will be required, in accordance with Section 5.7, to
prepare and transmit to the Agent an additional Officers' Certificate setting
forth its calculation of the Fixed Settlement Rate in accordance with the Fixing
Formula and the effective date of the Fixed Settlement Rate. In no event will
the Fixed Settlement Rate be greater than 0.3325, subject to adjustment as
provided in Section 5.6. The Fixed Settlement Rate will become effective at the
open of business two Business Days after the close of the 20 consecutive Trading
Day period. The Fixed Settlement Rate shall be adjusted in the same manner and
at the same time as the Settlement Rate pursuant to Section 5.6.
SECTION 5.2. CONTRACT ADJUSTMENT PAYMENTS(a) Contract Adjustment
Payments shall accumulate on each Purchase Contract constituting a part of a
Unit at 3.97% per year of the Stated Amount of such Unit, from March 23, 2004
through and including the Stock Purchase Date, provided that no Contract
Adjustment Payment shall accrue after an Early Settlement or Merger Early
Settlement. Subject to Section 5.3, the Company shall pay, on each Payment Date,
the Contract Adjustment Payments, if any, payable in respect of each Purchase
Contract to the Person in whose name a Certificate (or one or more Predecessor
Certificates) is registered on the Register at the close of business on the
Record Date next preceding such Payment Date in such coin or currency of the
United States as at the time of payment shall be legal tender for payments. The
Contract Adjustment Payments, if any, will be payable at the Corporate Trust
Office or, at the option of the Company, by check mailed to the address of the
Person entitled thereto at such Person's address as it appears on the Register
or by wire transfer to the account maintained in the United States designated by
a prior written notice by such Person.
(b) Upon the occurrence of a Termination Event, the Company's
obligation to pay Contract Adjustment Payments (including any accrued and unpaid
Deferred Contract Adjustment Payments), if any, shall cease.
(c) Each Certificate delivered under this Agreement upon
registration of transfer of or in exchange for or in lieu of any other
Certificate (including as a result of a Collateral Substitution or the
re-establishment of a Normal Unit) shall carry the rights to receive Contract
Adjustment Payments (including any accrued and unpaid Deferred Contract
Adjustment Payments), if any, and to accrue Contract Adjustment Payments, if
any, which were carried by the Purchase Contracts underlying such other
Certificates.
(d) Subject to Sections 5.4, 5.9 and 5.10, in the case of any
Unit with respect to which Early Settlement or Merger Early Settlement of the
underlying Purchase Contract is effected on an Early Settlement Date or a Merger
Early Settlement Date, respectively, or in respect of which Cash Settlement of
the underlying Purchase Contract is effected on the thirteenth Business Day
immediately preceding the Stock Purchase Date, or with respect to
37
which a Collateral Substitution or an establishment or re-establishment of a
Normal Unit pursuant to Section 3.14 is effected, in each case on a date that is
after any Record Date and on or prior to the next succeeding Payment Date,
Contract Adjustment Payments on the Purchase Contract underlying such Unit
otherwise payable on such Payment Date shall be payable on such Payment Date
notwithstanding such Cash Settlement, Early Settlement, Merger Early Settlement,
Collateral Substitution or establishment or re-establishment of Normal Units,
and such Contract Adjustment Payments shall, subject to receipt thereof by the
Agent, be payable to the Person in whose name the Certificate evidencing such
Unit (or one or more Predecessor Certificates) was registered at the close of
business on such Record Date. Except as otherwise expressly provided in the
immediately preceding sentence, in the case of any Unit with respect to which
Early Settlement or Merger Early Settlement on an Early Settlement Date or
Merger Early Settlement Date, as the case may be, Contract Adjustment Payments,
if any, that would otherwise be payable after the Early Settlement Date, or
Merger Early Settlement Date, with respect to such Purchase Contract shall not
be payable.
(e) The Company's obligations with respect to Contract Adjustment
Payments (including any accrued or Deferred Contract Adjustment Payments) will
be subordinated and junior in right of payment to the Company's obligations
under any Senior Indebtedness to the extent set forth in Section 5.2(f).
(f) Subject to the provisions of Section 5.8, in the event (x) of any
payment by, or distribution of assets of, the Company of any kind or character,
whether in cash, property or securities, to creditors upon any dissolution,
winding-up, liquidation or reorganization of the Company, whether voluntary or
involuntary or in bankruptcy, insolvency, receivership or other proceedings, or
(y) subject to the provisions of Section 5.2(h) below, that (i) a default shall
have occurred and be continuing with respect to the payment of principal,
interest or any other monetary amounts due and payable on any Senior
Indebtedness and such default shall have continued beyond the period of grace,
if any, specified in the instrument evidencing such Senior Indebtedness (and the
Agent shall have received written notice thereof from the Company or one or more
holders of Senior Indebtedness or their representative or representatives or the
trustee or trustees under any indenture pursuant to which any such Senior
Indebtedness may have been issued), or (ii) the maturity of any Senior
Indebtedness shall have been accelerated because of a default in respect of such
Senior Indebtedness (and the Agent shall have received written notice thereof
from the Company or one or more holders of Senior Indebtedness or their
representative or representatives or the trustee or trustees under any indenture
pursuant to which any such Senior Indebtedness may have been issued), then:
(i) the holders of all Senior Indebtedness shall first be
entitled to receive, in the case of clause (x) above, payment
in full of all amounts due or to become due upon all Senior
Indebtedness and, in the case of subclauses (i) and (ii) of
clause (y) above, payment of all amounts due thereon, or
provision shall be made for such payment in money or money's
worth, before the Holders of any of the Units are entitled to
receive any Contract Adjustment Payments on the Purchase
Contracts underlying the Units;
(ii) any payment by, or distribution of assets of, the
Company of any kind or character, whether in cash, property or
securities, to which the Holders of
38
any of the Units would be entitled except for the provisions
of Sections 5.2(e) through (q), including any such payment or
distribution which may be payable or deliverable by reason of
the payment of any other indebtedness of the Company being
subordinated to the payment of such Contract Adjustment
Payments on the Purchase Contracts underlying the Units, shall
be paid or delivered by the Person making such payment or
distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee or otherwise, directly to the holders of
such Senior Indebtedness or their representative or
representatives or to the trustee or trustees under any
indenture under which any instruments evidencing any of such
Senior Indebtedness may have been issued, ratably according to
the aggregate amounts remaining unpaid on account of such
Senior Indebtedness held or represented by each, to the extent
necessary to make payment in full of all Senior Indebtedness
remaining unpaid after giving effect to any concurrent payment
or distribution (or provision therefor) to the holders of such
Senior Indebtedness, before any payment or distribution is
made of such Contract Adjustment Payments to the Holders of
such Units; and
(iii) in the event that, notwithstanding the foregoing, any
payment by, or distribution of assets of, the Company of any
kind or character, whether in cash, property or securities,
including any such payment or distribution which may be
payable or deliverable by reason of the payment of any other
indebtedness of the Company being subordinated to the payment
of Contract Adjustment Payments on the Purchase Contracts
underlying the Units, shall be received by the Agent or the
Holders of any of the Units when such payment or distribution
is prohibited pursuant to Sections 5.2(e) through (q), such
payment or distribution shall be paid over to the holders of
such Senior Indebtedness or their representative or
representatives or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any
such Senior Indebtedness may have been issued, ratably as
aforesaid, for application to the payment of all Senior
Indebtedness remaining unpaid until all such Senior
Indebtedness shall have been paid in full, after giving effect
to any concurrent payment or distribution (or provision
therefor) to the holders of such Senior Indebtedness.
(g) For purposes of Sections 5.2(e) through (q), the words
"cash, property or securities" shall not be deemed to include shares of stock of
the Company as reorganized or readjusted, or securities of the Company or any
other Person provided for by a plan of reorganization or readjustment, the
payment of which is subordinated at least to the extent provided in Sections
5.2(e) through (q) with respect to such Contract Adjustment Payments on the
Units to the payment of all Senior Indebtedness which may at the time be
outstanding; provided that (i) the indebtedness or guarantee of indebtedness, as
the case may be, that constitutes Senior Indebtedness is assumed by the Person,
if any, resulting from any such reorganization or readjustment, and (ii) the
rights of the holders of the Senior Indebtedness are not, without the consent of
each such holder adversely affected thereby, altered by such reorganization or
readjustment.
(h) Any failure by the Company to make any payment on or
perform any other obligation under Senior Indebtedness, other than any
indebtedness incurred by the Company or
39
assumed or guaranteed, directly or indirectly, by the Company for money borrowed
(or any deferral, renewal, extension or refunding thereof) or any indebtedness
or obligation as to which the provisions of Sections 5.2(e) through (g) shall
have been waived by the Company in the instrument or instruments by which the
Company incurred, assumed, guaranteed or otherwise created such indebtedness or
obligation, shall not be deemed a default or event of default if (i) the Company
shall be disputing its obligation to make such payment or perform such
obligation and (ii) either (A) no final judgment relating to such dispute shall
have been issued against the Company which is in full force and effect and is
not subject to further review, including a judgment that has become final by
reason of the expiration of the time within which a party may seek further
appeal or review, and (B) in the event a judgment that is subject to further
review or appeal has been issued, the Company shall in good faith be prosecuting
an appeal or other proceeding for review and a stay of execution shall have been
obtained pending such appeal or review.
(i) Subject to the payment in full of all Senior Indebtedness,
the Holders of the Purchase Contracts underlying the Units shall be subrogated
(equally and ratably with the holders of all obligations of the Company which by
their express terms are subordinated to Senior Indebtedness of the Company to
the same extent as payment of the Contract Adjustment Payments in respect of the
Purchase Contracts underlying the Units is subordinated and which are entitled
to like rights of subrogation) to the rights of the holders of Senior
Indebtedness to receive payments or distributions of cash, property or
securities of the Company applicable to the Senior Indebtedness until all such
Contract Adjustment Payments owing on the Purchase Contracts underlying the
Units shall be paid in full, and as between the Company, its creditors other
than holders of such Senior Indebtedness and the Holders, no such payment or
distribution made to the holders of Senior Indebtedness by virtue of Sections
5.2(e) through (q) that otherwise would have been made to the Holders shall be
deemed to be a payment by the Company on account of such Senior Indebtedness, it
being understood that the provisions of Sections 5.2(e) through (q) are and are
intended solely for the purpose of defining the relative rights of the Holders,
on the one hand, and the holders of Senior Indebtedness, on the other hand.
(j) Nothing contained in Sections 5.2(e) through (q) or
elsewhere in this Agreement or in the Units is intended to or shall impair, as
among the Company, its creditors other than the holders of Senior Indebtedness
and the Holders, the obligation of the Company, which, subject to the occurrence
of a Termination Event as described in Section 5.2(b) and the Company's right
pursuant to Section 5.3 to defer Contract Adjustment Payments, is absolute and
unconditional, to pay to the Holders such Contract Adjustment Payments on the
Purchase Contracts underlying the Units as and when the same shall become due
and payable in accordance with their terms, or is intended to or shall affect
the relative rights of the Holders and creditors of the Company other than the
holders of Senior Indebtedness, nor shall anything herein or therein prevent the
Agent or any Holder from exercising all remedies otherwise permitted by
applicable law upon default under this Agreement, subject to the rights, if any,
under these Sections 5.2(e) through (q), of the holders of Senior Indebtedness
in respect of cash, property or securities of the Company received upon the
exercise of any such remedy.
(k) Upon payment or distribution of assets of the Company
referred to in these Sections 5.2(e) through (q), the Agent and the Holders
shall be entitled to rely upon any order or decree made by any court of
competent jurisdiction in which any such dissolution, winding up,
40
liquidation or reorganization proceeding affecting the affairs of the Company is
pending or upon a certificate of the trustee in bankruptcy, receiver, assignee
for the benefit of creditors, liquidating trustee or agent or other Person
making any payment or distribution, delivered to the Agent or to the Holders,
for the purpose of ascertaining the Persons entitled to participate in such
payment or distribution, the holders of the Senior Indebtedness and other
indebtedness of the Company, the amount thereof or payable thereon, the amount
or amounts paid or distributed thereon and all other facts pertinent thereto or
to these Sections 5.2(e) through (q).
(l) The Agent shall be entitled to rely on the delivery to it
of a written notice by a Person representing himself to be a holder of Senior
Indebtedness (or a trustee or representative on behalf of such holder) to
establish that such notice has been given by a holder of Senior Indebtedness or
a trustee or representative on behalf of any such holder or holders. In the
event that the Agent determines in good faith that further evidence is required
with respect to the right of any Person as a holder of Senior Indebtedness to
participate in any payment or distribution pursuant to Sections 5.2(e) through
(q), the Agent may request such Person to furnish evidence to the reasonable
satisfaction of the Agent as to the amount of Senior Indebtedness held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts pertinent to the rights of such
Person under Sections 5.2(e) through (q), and, if such evidence is not
furnished, the Agent may defer payment to such Person pending judicial
determination as to the right of such Person to receive such payment.
(m) Nothing contained in Sections 5.2(e) through (q) shall
affect the obligations of the Company to make, or prevent the Company from
making, payment of the Contract Adjustment Payments, except as provided in these
Sections 5.2(e) through (q).
(n) Each Holder of Units, by his acceptance thereof,
authorizes and directs the Agent on his, her or its behalf to take such action
as may be necessary or appropriate to effectuate the subordination provided in
Sections 5.2(e) through (q) and appoints the Agent his, her or its
attorney-in-fact, as the case may be, for any and all such purposes.
(o) The Company shall give prompt written notice to the Agent
of any fact known to the Company that would prohibit the making of any payment
of moneys to or by the Agent in respect of the Purchase Contracts underlying the
Units pursuant to the provisions of this Section 5.2. Notwithstanding the
provisions of Sections 5.2(e) through (q) or any other provisions of this
Agreement, the Agent shall not be charged with knowledge of the existence of any
facts that would prohibit the making of any payment of moneys to or by the
Agent, or the taking of any other action by the Agent, unless and until the
Agent shall have received written notice thereof mailed or delivered to a
Responsible Officer of the Agent from the Company, any Holder, any paying agent
or the holder or representative of any Senior Indebtedness; provided that, if at
least two Business Days prior to the date upon which by the terms hereof any
such moneys may become payable for any purpose, the Agent shall not have
received with respect to such moneys the notice provided for in this Section
5.2(o), then, anything herein contained to the contrary notwithstanding, the
Agent shall have full power and authority to receive such moneys and to apply
the same to the purpose for which they were received and shall not be affected
by any notice to the contrary that may be received by it within two Business
Days prior to or on or after such date.
41
(p) The Agent in its individual capacity shall be entitled to
all the rights set forth in this Section 5.2 with respect to any Senior
Indebtedness at the time held by it, to the same extent as any other holder of
Senior Indebtedness and nothing in this Agreement shall deprive the Agent of any
of its rights as such holder.
(q) No right of any present or future holder of any Senior
Indebtedness to enforce the subordination herein shall at any time or in any way
be prejudiced or impaired by any act or failure to act on the part of the
Company or by any noncompliance by the Company with the terms, provisions and
covenants of this Agreement, regardless of any knowledge thereof which any such
holder may have or be otherwise charged with.
(r) Nothing in this Section 5.2 shall apply to claims of, or
payments to, the Agent under or pursuant to Section 7.7 hereof.
With respect to the holders of Senior Indebtedness, (i) the
duties and obligations of the Agent shall be determined solely by the express
provisions of this Agreement; (ii) the Agent shall not be liable except for the
performance of such duties and obligations as are specifically set forth in this
Agreement; (iii) no implied covenants or obligations shall be read into this
Agreement against the Agent; and (iv) the Agent shall not be deemed to be a
fiduciary as to such holders.
SECTION 5.3. DEFERRAL OF CONTRACT ADJUSTMENT PAYMENTS. (a) The Company
shall have the right, at any time prior to the Stock Purchase Date, to defer the
payment of any or all of the Contract Adjustment Payments otherwise payable on
any Payment Date, but only if the Company shall give the Holders and the Agent
written notice of its election to defer each such deferred Contract Adjustment
Payment (specifying the amount to be deferred) at least ten Business Days prior
to the earlier of (i) the next succeeding Payment Date or (ii) the date the
Company is required to give notice of the Record Date or Payment Date with
respect to payment of such Contract Adjustment Payments to the NYSE or other
applicable self-regulatory organization or to Holders of the Units, but in any
event not less than one Business Day prior to such Record Date. Any Contract
Adjustment Payments so deferred shall, to the extent permitted by law, accrue
additional Contract Adjustment Payments thereon at the rate of 6.50% per year
(computed on the basis of a 360-day year of twelve 30-day months), compounding
on each succeeding Payment Date, until paid in full (such deferred installments
of Contract Adjustment Payments, if any, together with the additional Contract
Adjustment Payments, if any, accrued thereon, being referred to herein as the
"Deferred Contract Adjustment Payments"). Deferred Contract Adjustment Payments,
if any, shall be due on the next succeeding Payment Date except to the extent
that payment is deferred pursuant to this Section 5.3. No Contract Adjustment
Payments may be deferred to a date that is after the Settlement Date and no such
deferral period may end other than on a Payment Date. If the Purchase Contracts
are terminated upon the occurrence of a Termination Event, the Holder's right to
receive Contract Adjustment Payments, if any, and any Deferred Contract
Adjustment Payments, will terminate.
(b) In the event that the Company elects to defer the payment
of Contract Adjustment Payments on the Purchase Contracts until a Payment Date
prior to the Stock Purchase Date, then all Deferred Contract Adjustment
Payments, if any, shall be payable to
42
the registered Holders as of the close of business on the Record Date
immediately preceding such Payment Date.
(c) In the event that the Company elects to defer the payment
of Contract Adjustment Payments on the Purchase Contracts until the Stock
Purchase Date, each Holder will receive on the Stock Purchase Date in lieu of a
cash payment a number of Ordinary Shares (in addition to a number of Ordinary
Shares equal to the Settlement Rate or, if the Settlement Rate has been fixed
pursuant to Section 5.1(f), the Fixed Settlement Rate) equal to (A) the
aggregate amount of Deferred Contract Adjustment Payments payable to such Holder
(net of any required tax withholding on such Deferred Contract Adjustment
Payment, which shall be remitted to the appropriate taxing jurisdiction) divided
by (B) the Applicable Market Value.
(d) No fractional Ordinary Shares will be issued by the
Company with respect to the payment of Deferred Contract Adjustment Payments on
the Stock Purchase Date. In lieu of fractional shares otherwise issuable with
respect to such payment of Deferred Contract Adjustment Payments, the Holder
will be entitled to receive an amount in cash as provided in Section 5.12.
(e) In the event the Company exercises its option to defer the
payment of Contract Adjustment Payments then, until the earlier of (x) the
Termination Date or (y) the date on which the Deferred Contract Adjustment
Payments have been paid, the Company shall not declare or pay dividends on, make
distributions with respect to, or redeem, purchase or acquire, or make a
liquidation payment with respect to, any of the Company's Capital Stock other
than:
(i) repurchases, redemptions or acquisitions of Ordinary
Shares of the Company in connection with any employment
contract, benefit plan or other similar arrangement with or
for the benefit of employees, officers, directors or agents or
a share purchase or dividend reinvestment plan, or the
satisfaction by the Company of its obligations pursuant to any
contract or security outstanding on the date the Company
exercises its right to defer the payment of Contract
Adjustment Payments;
(ii) as a result of a reclassification of the Company's
Capital Stock or the exchange or conversion of one class or
series of the Company's Capital Stock for another class or
series of the Company's Capital Stock;
(iii) the purchase of fractional interests of the Company's
Capital Stock pursuant to the conversion or exchange
provisions of such Capital Stock or the security being
converted or exchanged;
(iv) dividends or distributions in the Company's Capital
Stock (or rights to acquire the Company's Capital Stock) or
repurchases, redemptions or acquisitions of the Company's
Capital Stock in exchange for or out of the net cash proceeds
of the sale of the Company's Capital Stock (or securities
convertible into or exchangeable for shares of the Company's
Capital Stock); or
(v) redemptions, exchanges or repurchases of any rights
outstanding under a shareholder rights plan on the date the
Company exercises its right to
43
defer the payment of Contract Adjustment Payments or the
declaration or payment thereunder of a dividend or
distribution of or with respect to rights in the future, or
the redemption or repurchase of any rights pursuant thereto.
SECTION 5.4. PAYMENT OF PURCHASE PRICE; REMARKETING. (a) Unless a
Special Event Redemption or Termination Event has occurred, or a Holder of a
Unit has settled the underlying Purchase Contract through an Early Settlement
pursuant to Section 5.9 or a Merger Early Settlement pursuant to Section 5.10,
each Holder of a Normal Unit may pay in cash ("Cash Settlement") the Purchase
Price for the Ordinary Shares to be purchased pursuant to a Purchase Contract if
such Holder notifies the Agent by surrender of the Normal Unit Certificate and
delivery of a notice in substantially the form of Exhibit E hereto of its
intention to make a Cash Settlement. Such notice shall be made on or prior to
5:00 p.m., New York City time, on the thirteenth Business Day immediately
preceding the Stock Purchase Date. The Agent shall promptly notify the
Collateral Agent of the receipt of such a notice from a Holder intending to make
a Cash Settlement.
(i) A Holder of a Normal Unit who has so notified the Agent
of its intention to make a Cash Settlement is required to pay
the Purchase Price to the Collateral Agent prior to 10:00
a.m., New York City time, on the thirteenth Business Day
immediately preceding the Stock Purchase Date in lawful money
of the United States by certified or cashier's check or wire
transfer, in each case in immediately available funds payable
to or upon the order of the Collateral Agent for deposit in
the Collateral Account. Any cash received by the Collateral
Agent will be paid to the Company on the Stock Purchase Date
in settlement of the Purchase Contract in accordance with the
terms of this Agreement and the Pledge Agreement, and any
funds received by the Collateral Agent in excess of the
Purchase Price for the Ordinary Shares to be purchased by such
Holder shall be distributed to the Purchase Contract Agent
when received for payment to the Holder.
(ii) If a Holder of a Normal Unit fails to notify the Agent
of its intention to make a Cash Settlement in accordance with
paragraph (a)(i) above, the Holder shall be deemed to have
consented to the disposition of the Pledged Notes pursuant to
the remarketing as described in paragraph (b) below. If a
Holder of a Normal Unit does notify the Agent as provided in
paragraph (a)(i) above of its intention to pay the Purchase
Price in cash, but fails to make such payment as required by
paragraph (a)(i) above, the Holder shall be deemed to have
consented to the disposition of the Pledged Notes pursuant to
the remarketing as described in paragraph 5.4.
(b) (i) Unless a Special Event Redemption has occurred, the
Company shall engage, no later than 30 days prior to the Remarketing Date, a
nationally recognized investment bank (the "Remarketing Agent") pursuant to a
Remarketing Agreement to be mutually agreed on by the Company, the Agent and the
Remarketing Agent, but providing for remarketing procedures substantially as set
forth below to sell the Notes of Holders of Normal Units, other than Holders
that have elected not to participate in the
44
remarketing pursuant to the procedures set forth in clause (iv) below, and
holders of Separate Notes that have elected to participate in the remarketing
pursuant to the procedures set forth in Section 4.5(d) of the Pledge Agreement
and Section 2.19 of the First Supplemental Indenture. The Company or the Agent,
at the Company's request, shall notify (the "Remarketing Notice"), not later
than seven Business Days immediately preceding the Remarketing Date, Holders of
Normal Units, and holders of Separate Notes that have elected to participate in
the remarketing pursuant to the procedures set forth in Section 4.5(d) of the
Pledge Agreement, of the remarketing to take place on the ninth Business Day
immediately preceding the Stock Purchase Date (the "Remarketing Date"), and if
necessary, on the eighth Business Day immediately preceding the Stock Purchase
Date, and if necessary, on the seventh Business Day immediately preceding the
Stock Purchase Date, and if necessary, on the sixth Business Day immediately
preceding the Stock Purchase Date, and if necessary, on the fifth Business Day
immediately preceding the Stock Purchase Date, and if necessary, on the fourth
Business Day immediately preceding the Stock Purchase Date, and if necessary, on
the third Business Day immediately preceding the Stock Purchase Date (each such
date other than the Remarketing Date a "Subsequent Remarketing Date") (and if
such Normal Units or Separate Notes are held in global form, the Company, or the
Agent, at the Company's request, will cause the Clearing Agency to notify the
Clearing Agency participants of such remarketing). The Remarketing Notice will
include the amount of cash that must be delivered by the Holders of Normal Units
that elect not to participate in the remarketing and the deadline for such
delivery, as well as information with respect to the exercise of the Put Right
(as defined in the First Supplemental Indenture). The Agent shall notify, by
10:00 a.m., New York City time, on the eleventh Business Day preceding the Stock
Purchase Date, the Remarketing Agent and the Collateral Agent of the aggregate
principal amount of Notes of Normal Unit Holders to be remarketed. On the
eleventh Business Day preceding the Stock Purchase Date, no later than by 10:00
a.m., New York City time, pursuant to the terms of the Pledge Agreement, the
Custodial Agent will notify the Remarketing Agent of the aggregate principal
amount of Separate Notes to be remarketed. No later than 10:00 a.m., New York
City time, on the tenth Business Day immediately preceding the Stock Purchase
Date, the Collateral Agent and the Custodial Agent, pursuant to the terms of the
Pledge Agreement, will deliver for remarketing to the Remarketing Agent all
Notes to be remarketed. Upon receipt of such notice from the Agent and the
Custodial Agent and such Notes from the Collateral Agent and the Custodial
Agent, the Remarketing Agent will, on the Remarketing Date, and if necessary, on
each Subsequent Remarketing Date, use its reasonable best efforts to sell such
Notes on such dates at an aggregate price equal to 100.25% of the aggregate
principal amount of such Notes. If the Remarketing Agent is able to remarket
such Notes at a price equal to or greater than 100.25% of the aggregate
principal amount of such Notes, the proceeds will be paid to the Agent in direct
settlement of the obligations of the Holders under the related Purchase
Contracts to purchase Ordinary Shares of the Company. In the event of a
successful remarketing pursuant to this Section 5.4, the Remarketing Agent will
deduct as a remarketing fee an amount not exceeding 25 basis points (0.25%) of
the total proceeds of such remarketing of Notes (the "Remarketing Fee"). The
Remarketing Agent will remit (1) the portion of the proceeds from the
remarketing attributable to the Separate Notes to the holders of Separate Notes
that were remarketed and (2) the remaining portion of the proceeds, less those
proceeds used to pay the Company in direct settlement of the Holders'
obligations under the Purchase Contracts, to the Agent for the benefit of the
Holders of the Normal Units that were remarketed, all determined on a pro rata
basis, in each case, on or prior to the third Business Day following the date on
which the Notes were successfully remarketed. Holders whose Notes are so
45
remarketed will not otherwise be responsible for the payment of any Remarketing
Fee in connection therewith.
(ii) If, in spite of using its reasonable best efforts, the
Remarketing Agent cannot remarket the Notes included in the
remarketing at a price equal to 100.25% of the principal
amount of the Notes included in the remarketing an the
Remarketing Date, the Remarketing Agent will attempt to
establish a Remarketing Rate meeting these requirements on
each of the Subsequent Remarketing Dates. If, in spite of
using its reasonable best efforts, the Remarketing Agent fails
to remarket the Notes included in the remarketing at a price
equal to 100.25% of the principal amount of the Notes included
in the remarketing on or before 4:00 p.m., New York City time
on the third Business Day immediately preceding the Stock
Purchase Date, the remarketing will be deemed to have failed
(the "Last Failed Remarketing"). Within three Business Days
following the date of the Last Failed Remarketing, the
Remarketing Agent shall return any Notes delivered to it to
the Collateral Agent and the Custodial Agent, as applicable.
The Collateral Agent, for the benefit of the Company, may
exercise its rights as a secured party with respect to such
Notes, including those actions specified in (b) (iii) below;
provided that if upon the Last Failed Remarketing, the
Collateral Agent exercises such rights for the benefit of the
Company with respect to such Notes, any accumulated and unpaid
interest on such Notes will become payable by the Company to
the Agent for payment to the Holders of the Normal Units to
which such Notes relate. Such payment will be made by the
Company on or prior to 11:00 a.m., New York City time, on the
Stock Purchase Date in lawful money of the United States by
certified or cashier's check or wire transfer in immediately
available funds payable to or upon the order of the Agent. The
Company will cause a notice of any failed remarketing and of
the Last Failed Remarketing to be published before 9:00 a.m.,
New York City time, on the Business Day following each failed
remarketing and the Last Failed Remarketing, as the case may
be, in a daily newspaper in the English language of general
circulation in the City of New York, which shall be The Wall
Street Journal, if such newspaper is then so published. The
Company will also release this information by means of
Bloomberg and Reuters newswire (or any successor or equivalent
of such newswires).
(iii) With respect to any Notes which constitute part of
Normal Units which are subject to the Last Failed Remarketing,
the Collateral Agent for the benefit of the Company reserves
all of its rights as a secured party with respect thereto and,
subject to applicable law and Section 5.4 (e) below, may,
among other things, (A) retain such Notes in full satisfaction
of the Holders' obligations under the Purchase Contracts or
(B) sell such Notes in one or more public or private sales or
otherwise.
(iv) A Holder of Normal Units may elect not to participate
in the remarketing and retain the Notes underlying such Units
by notifying the Agent of such election and delivering the
requisite amount of cash in lawful money of the United States
by certified or cashier's check or wire transfer, in each
case, in
46
immediately available funds, of $25 per Purchase Contract to
the Agent not later than 5:00 p.m. New York City time on the
thirteenth Business Day prior to the Stock Purchase Date as
set forth in the Remarketing Notice. Upon receipt thereof by
the Agent, the Agent shall deliver such cash to the Collateral
Agent, which will for the benefit of the Company, thereupon
apply such cash to secure such Holder's obligations under the
Purchase Contracts. On the second Business Day immediately
preceding the first day of the Remarketing Period, the
Collateral Agent, pursuant to the terms of the Pledge
Agreement, will deliver the Pledged Notes of such Holder to
the Agent and within three Business Days thereof, the Agent
shall distribute such Notes to the Holders thereof. A Holder
that does not so deliver the requisite cash or does not so
notify the Agent of its election not to participate in the
remarketing pursuant to this clause (iv) shall be deemed to
have elected to participate in the remarketing. Any cash
received by the Collateral Agent will be paid to the Company
on the Stock Purchase Date in settlement of the Purchase
Contract in accordance with the terms of this Agreement and
the Pledge Agreement, and any funds received by the Collateral
Agent in excess of the Purchase Price for the Ordinary Shares
to be purchased by such Holder shall be distributed to the
Purchase Contract Agent when received for payment to the
Holder.
(c) Upon the maturity of the Pledged Treasury Securities
underlying the Stripped Units and, in the event of a Special Event Redemption,
the Pledged Treasury Consideration underlying the Normal Units on the Stock
Purchase Date, the Collateral Agent shall remit to the Company an amount equal
to the aggregate Purchase Price applicable to such Units, as payment for the
Ordinary Shares issuable upon settlement thereof without needing to receive any
instructions from the Holders of such Units. In the event the payments in
respect of the Pledged Treasury Securities or the Pledged Treasury Consideration
underlying a Unit is in excess of the Purchase Price of the Purchase Contract
being settled thereby, the Collateral Agent will distribute such excess to the
Agent for the benefit of the Holder of such Unit when received.
(d) Any distribution to Holders of excess funds and interest
described in Section 5.4 (b) and (c) above shall be payable at the Corporate
Trust Office or, at the option of the Holder or the holder of Separate Notes, as
applicable, by check mailed to the address of the Person entitled thereto at
such address as it appears on the Register or by wire transfer to an account
maintained in the United States specified by the Holder or the holder of
Separate Notes, as applicable.
(e) Notwithstanding anything to the contrary herein or in the
Pledge Agreement, subject to Section 3.2 of the Pledge Agreement, the
obligations of each Holder to pay the Purchase Price are non-recourse
obligations and are payable solely out of the proceeds of any Collateral pledged
to secure the obligations of the Holders (except to the extent paid by Cash
Settlement, Early Settlement or Merger Early Settlement) and in no event will
Holders be liable for any deficiency between such payments and the Purchase
Price.
(f) Notwithstanding anything to the contrary herein, the
Company shall not be obligated to issue any Ordinary Shares in respect of a
Purchase Contract or deliver any certificates therefor to the Holder of the
related Unit unless the Company shall have (i) received
47
payment in full of the aggregate Purchase Price for the Ordinary Shares to be
purchased thereunder by such Holder in the manner herein set forth or (ii)
become entitled to exercise its rights as a secured party under Section
5.4(b)(iii).
SECTION 5.5. ISSUANCE OF ORDINARY SHARES.
Unless a Termination Event shall have occurred on or prior to
the Stock Purchase Date or an Early Settlement or a Merger Early Settlement
shall have occurred, on the Stock Purchase Date, upon the Company's receipt of
payment in full of the Purchase Price for the Ordinary Shares purchased by the
Holders pursuant to the foregoing provisions of this Article and subject to
Section 5.6(b) or the Company's exercise of its rights as a secured party
pursuant to Section 5.4(b)(iii), the Company shall issue and deposit with the
Agent, for the benefit of the Holders of the Outstanding Units, one or more
certificates representing the newly issued Ordinary Shares, registered in the
name of the Agent (or its nominee) as custodian for the Holders (such
certificates for Ordinary Shares, together with any dividends or distributions
for which both a record date and payment date for such dividend or distribution
has occurred after the Stock Purchase Date, being hereinafter referred to as the
"Purchase Contract Settlement Fund"), to which the Holders are entitled
hereunder. Subject to the foregoing, upon surrender of a Certificate to the
Agent on or after the Stock Purchase Date, together with settlement instructions
thereon duly completed and executed, the Holder of such Certificate shall be
entitled to receive in exchange therefor a certificate representing that number
of whole Ordinary Shares which such Holder is entitled to receive pursuant to
the provisions of this Article V (after taking into account all Units then held
by such Holder) together with cash in lieu of fractional shares as provided in
Section 5.12 and any dividends or distributions with respect to such shares
constituting part of the Purchase Contract Settlement Fund, but without any
interest thereon, and the Certificate so surrendered shall forthwith be
cancelled. Such shares shall be registered in the name of the Holder or the
Holder's designee as specified in the settlement instructions provided by the
Holder to the Agent. If any Ordinary Shares issued in respect of a Purchase
Contract are to be registered to a Person other than the Person in whose name
the Certificate evidencing such Purchase Contract is registered, no such
registration shall be made unless the Person requesting such registration has
paid any transfer and other taxes required by reason of such registration in a
name other than that of the registered Holder of such Certificate or has
established to the satisfaction of the Company that such tax either has been
paid or is not payable.
SECTION 5.6. ADJUSTMENT OF SETTLEMENT RATE.
(a) Adjustments for Dividends, Distributions, Stock Splits,
Etc.
(1) Stock Dividends. In case the Company shall pay or make a
dividend or other distribution to all holders of its Ordinary Shares payable
exclusively in Ordinary Shares, the Settlement Rate, as in effect at the opening
of business on the day following the date fixed for the determination of
shareholders entitled to receive such dividend or other distribution shall be
increased by dividing such Settlement Rate by a fraction of which the numerator
shall be the number of Ordinary Shares outstanding at the close of business on
the date fixed for such determination and the denominator shall be the sum of
such number of Ordinary Shares and the total number of Ordinary Shares
constituting such dividend or other distribution, such increase to become
effective immediately after the opening of business on the day following the
date fixed
48
for such determination. For the purposes of this paragraph (1), the number of
Ordinary Shares at the time outstanding shall not include shares held in the
treasury of the Company but shall include any shares issuable in respect of any
scrip certificates issued in lieu of fractions of Ordinary Shares. The Company
will not pay any dividend or make any distribution on Ordinary Shares held in
the treasury of the Company.
(2) Stock Purchase Rights. In case the Company shall issue, to
all holders of its Ordinary Shares, rights, options or warrants to all holders
of its Ordinary Shares (that are not available on an equivalent basis to Holders
of the Units upon settlement of the Purchase Contracts underlying such Units)
entitling them, for a period expiring within 45 days after the record date for
the determination of shareholders entitled to receive such rights, options or
warrants, to subscribe for or purchase Ordinary Shares at a price per share less
than the Current Market Price per share of Ordinary Shares on the date fixed for
the determination of shareholders entitled to receive such rights, options or
warrants, the Settlement Rate in effect at the opening of business on the day
following the date fixed for such determination shall be increased by dividing
such Settlement Rate by a fraction, the numerator of which shall be the number
of Ordinary Shares outstanding at the close of business on the date fixed for
such determination plus the number of Ordinary Shares which the aggregate of the
offering price of the total number of Ordinary Shares so offered for
subscription or purchase would purchase at such Current Market Price per
Ordinary Share and the denominator of which shall be the number of Ordinary
Shares outstanding at the close of business on the date fixed for such
determination plus the number of Ordinary Shares so offered for subscription or
purchase, such increase to become effective immediately after the opening of
business on the day following the date fixed for such determination. For the
purposes of this paragraph (2), the number of Ordinary Shares at any time
outstanding shall not include shares held in the treasury of the Company but
shall include any shares issuable in respect of any scrip certificates issued in
lieu of fractions of Ordinary Shares. The Company shall not issue any such
rights, options or warrants in respect of Ordinary Shares held in the treasury
of the Company.
(3) Stock Splits; Reverse Splits. In case outstanding Ordinary
Shares shall be subdivided or split into a greater number of Ordinary Shares,
the Settlement Rate in effect at the opening of business on the day following
the day upon which such subdivision or split becomes effective shall be
proportionately increased, and, conversely, in case outstanding Ordinary Shares
shall each be combined into a smaller number of Ordinary Shares, the Settlement
Rate in effect at the opening of business on the day following the day upon
which such combination becomes effective shall be proportionately reduced, such
increase or reduction, as the case may be, to become effective immediately after
the opening of business on the day following the day upon which such
subdivision, split or combination becomes effective.
(4) Debt or Asset Distributions. (i) In case the Company
shall, by dividend or otherwise, distribute to all holders of its Ordinary
Shares evidences of its indebtedness or assets (including securities, but
excluding any rights or warrants referred to in paragraph (2) of this Section
5.6(a), shares of capital stock of any class or series, or similar equity
interests, of or relating to a subsidiary or other business unit in the case of
a Spin-Off referred to in the next paragraph, or any dividend or distribution
paid exclusively in cash and any dividend or distribution referred to in
paragraph (1) of this Section 5.6(a)), the Settlement Rate shall be adjusted so
that the same shall equal the rate determined by dividing the Settlement Rate in
effect
49
immediately prior to the close of business on the date fixed for the
determination of shareholders entitled to receive such distribution by a
fraction, the numerator of which shall be the Current Market Price per Ordinary
Share on the date fixed for such determination less the then fair market value
(as determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution filed with the Agent) of the
portion of the assets or evidences of indebtedness so distributed applicable to
one Ordinary Share and the denominator of which shall be such Current Market
Price per Ordinary Share, such adjustment to become effective immediately prior
to the opening of business on the day following the date fixed for the
determination of shareholders entitled to receive such distribution. In any case
in which this paragraph (4) is applicable, paragraph (2) of this Section 5.6(a)
shall not be applicable.
(ii) In the case of a Spin-Off, the Settlement Rate in effect
immediately before the close of business on the record date fixed for
determination of shareholders entitled to receive that distribution will be
increased by dividing the Settlement Rate by a fraction, the numerator of which
is the Current Market Price per Ordinary Share less the Fair Market Value of the
portion of those shares of Capital Stock or similar equity interests so
distributed applicable to one Ordinary Share and the denominator of which is the
Current Market Price per Ordinary Share. Any adjustment to the settlement rate
under this paragraph 4(ii) will occur on the date that is the earlier of (1) the
tenth Trading Day following the effective date of the Spin-Off and (2) the date
of the securities being offered in the Initial Public Offering of the Spin-Off,
if that Initial Public Offering is effected simultaneously with the Spin-Off.
(5) Tender Offers. In case (i) a tender or exchange offer made
by the Company or any subsidiary of the Company for all or any portion of the
Ordinary Shares shall expire and such tender or exchange offer (as amended upon
the expiration thereof) shall require the payment to shareholders (based on the
acceptance (up to any maximum specified in the terms of the tender or exchange
offer) of Purchased Shares) of an aggregate consideration having a fair market
value (as determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution filed with the Agent) that when
combined together with (ii) the aggregate of the cash plus the fair market value
(as determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution filed with the Agent), as of the
expiration of such tender or exchange offer (other than consideration payable in
respect of any odd-lot tender offer), of consideration payable in respect of any
other tender or exchange offer, by the Company or any subsidiary of the Company
for all or any portion of the Ordinary Shares expiring within the 12 months
preceding the expiration of such tender or exchange offer and in respect of
which no adjustment pursuant to this paragraph (5) has been made and (iii) the
aggregate amount of any distributions to all holders of the Ordinary Shares made
exclusively in cash (other than regular quarterly, semi-annual or annual cash
dividends) within the 12 months preceding the expiration of such tender or
exchange offer and in respect of which no adjustment pursuant to this paragraph
(5) has been made, exceeds 12.5% of the product of the Current Market Price per
Ordinary Share as of the last time (the "Expiration Time") tenders could have
been made pursuant to such tender or exchange offer (as it may be amended) times
the number of Ordinary Shares outstanding (including any tendered shares) on the
Expiration Time, then, and in each such case, immediately after the close of
business on the fifth Trading Day after the date of the Expiration Time, the
Settlement Rate shall be adjusted so that the same shall equal the rate
determined by dividing the Settlement Rate immediately prior to the close of
business on the date of the Expiration Time by a fraction (A) the numerator of
which
50
shall be equal to (x) the product of (I) the Current Market Price per share of
the Ordinary Shares and (II) the number of Ordinary Shares outstanding
(including any tendered shares) on the fifth Trading Day following the date of
the Expiration Time less (y) the amount of cash plus the fair market value
(determined as aforesaid) of the aggregate consideration payable to shareholders
based on the transactions described in clauses (i), (ii) and, to the extent no
adjustment has been made pursuant to clause (7), (iii) of this paragraph (5)
(assuming in the case of clause (i) the acceptance, up to any maximum specified
in the terms of the tender or exchange offer, of Purchased Shares), and (B) the
denominator of which shall be equal to the product of (x) the Current Market
Price per share of the Ordinary Shares and (y) the number of Ordinary Shares
outstanding (including any tendered shares) on the fifth Trading Day following
the date of the Expiration Time less the number of all shares validly tendered
and not withdrawn as of the Expiration Time (the shares deemed so accepted, up
to any such maximum, being referred to as the "Purchased Shares"). Such increase
in the Settlement Rate shall be given effect retroactively as of the close of
business on the date of the Expiration Time.
(6) Reclassification. The reclassification of Ordinary Shares
into securities including securities other than Ordinary Shares (other than any
reclassification upon a Reorganization Event to which Section 5.6(b) applies)
shall be deemed to involve (i) a distribution of such securities other than
Ordinary Shares to all holders of Ordinary Shares (and the effective date of
such reclassification shall be deemed to be "the date fixed for the
determination of shareholders entitled to receive such distribution" and the
"date fixed for such determination" within the meaning of paragraph (4) of this
Section 5.6(a)), and (ii) a subdivision, split or combination, as the case may
be, of the number of Ordinary Shares outstanding immediately prior to such
reclassification into the number of Ordinary Shares outstanding immediately
thereafter (and the effective date of such reclassification shall be deemed to
be "the day upon which such subdivision or split becomes effective" or "the day
upon which such combination becomes effective," as the case may be, and "the day
upon which such subdivision, split or combination becomes effective" within the
meaning of paragraph (3) of this Section 5.6(a)).
(7) Cash Distributions. In case the Company or any of its
Subsidiaries shall, by dividend or otherwise, make regular quarterly,
semi-annual or annual cash dividends or make any other distributions consisting
exclusively of cash to all holders of its Ordinary Shares, excluding any cash
dividend or distribution on the Ordinary Shares to the extent that the aggregate
cash dividend or distribution per Ordinary Share in any three month period does
not exceed $0.49 (the "Dividend Threshold Amount") (the Dividend Threshold
Amount is subject to adjustment on the same basis as the Settlement Rate,
provided that no adjustment shall be made to the Dividend Threshold Amount for
any adjustment made pursuant to this clause (7)) then, in such case, the
Settlement Rate in effect at the close of business on the date fixed for the
determination of shareholders entitled to receive such distribution dividend or
distribution shall be adjusted by dividing such rate by a fraction of which the
numerator shall be the Current Market Price per Ordinary Share on such date less
the amount of cash so distributed applicable to one Ordinary Share in excess of
the Dividend Threshold Amount; and the denominator shall be the Current Market
Price per Ordinary Share on such date, such adjustment to be effective at the
opening of business on the day following the date fixed for the determination of
shareholders entitled to receive such dividend or distribution; provided that if
the portion of the cash so distributed applicable to one Ordinary Share in
excess of the Dividend Threshold Amount is
51
equal to or greater than the Current Market Price on such date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each holder of a
Unit shall have the right to receive upon settlement of the Units such excess
amount. In the event that such dividend or distribution is not so paid or made,
the Settlement Rate shall again be adjusted to be the Settlement Rate that would
then be in effect if such dividend or distribution had not been declared.
(8) "Current Market Price". The "Current Market Price" per
Ordinary Share means (a) except as provided in clauses (b) through (d) of this
paragraph (8), for purposes of paragraphs (2), (4), (5) and (6) of this Section
5.6(a), on any day the average of the Closing Price per Ordinary Share on each
of the five consecutive Trading Days ending on the earlier of the day in
question and the day before the "ex date" with respect to the issuance or
distribution requiring such computation, (b) for purposes of subclauses (A) and
(B) of paragraph (5) of this Section 5.6(a), the average of the Closing Price
per Ordinary Share on each of the five consecutive Trading Days immediately
following the date of the Expiration Time, (c) in the case of any Spin-Off that
is effected simultaneously with an Initial Public Offering of the securities
being distributed in the Spin-Off, the Closing Price of the Ordinary Shares on
the Trading Day on which the initial price of the securities being distributed
in the Spin-Off is determined, and (d) in the case of any other Spin-Off, the
average of the Closing Prices per Ordinary Share over the first 10 Trading Days
after the effective date of such Spin-Off. For purposes of this paragraph and
the last sentence of paragraph (5) of this Section 5.6(a), the term "ex date,"
when used with respect to any issuance or distribution, shall mean the first
date on which the Ordinary Shares trade regular way on such exchange or in such
market without the right to receive such issuance or distribution.
(9) Calculation of Adjustments. All adjustments to the
Settlement Rate shall be calculated by the Company to the nearest 1/10,000th of
an Ordinary Share (or if there is not a nearest 1/10,000th of a share, to the
next lower 1/10,000th of a share). No adjustment to the Settlement Rate shall be
required unless such adjustment would require an increase or a decrease of at
least one percent; provided that any adjustments made shall be carried forward
and taken into account in any subsequent adjustment and notwithstanding whether
or not such one percent threshold shall have been met, all such adjustments
shall be made on the Stock Purchase Date. If an adjustment is made to the
Settlement Rate pursuant to paragraph (1) through (7) or (10) of this Section
5.6(a), an adjustment shall also be made to the Applicable Market Value solely
to determine which of clauses (i), (ii) or (iii) of the definition of Settlement
Rate in Section 5.1(a) will apply on the Stock Purchase Date. Such adjustment
shall be made by multiplying the Applicable Market Value by a fraction, the
numerator of which shall be the Settlement Rate immediately after such
adjustment pursuant to paragraph (1) through (7) or (10) of this Section 5.6(a)
and the denominator of which shall be the Settlement Rate immediately before
such adjustment; provided that if such adjustment to the Settlement Rate is
required to be made pursuant to the occurrence of any of the events contemplated
by paragraph (1) through (7) or (10) of this Section 5.6(a) during the period
taken into consideration for determining the Applicable Market Value,
appropriate and customary adjustments shall be made to the Settlement Rate.
52
(10) Increase of Settlement Rate. The Company may make such
increases in the Settlement Rate, in addition to those required by this Section,
as it considers to be advisable in order to avoid or diminish any income tax to
any holders of Ordinary Shares resulting from any dividend or distribution of
Capital Stock or issuance of rights or warrants to purchase or subscribe for
stock or from any event treated as such for income tax purposes or for any other
reasons.
(11) There shall not be any adjustment to the Settlement Rate
as a result of (a) the issuance of rights, (b) the distribution of separate
certificates representing rights, (c) the exercise or redemption of rights in
accordance with any rights agreement or (d) the termination or invalidation of
rights, in each case, pursuant to the Company's Rights Plan dated as of
September 1998 or any other similar rights plan of the Company (collectively, a
"Rights Plan"). To the extent that the Company has a Rights Plan in effect upon
settlement of a Purchase Contract (including the Company's Rights Plan dated as
of September 1998), the Holder shall receive, in addition to the Ordinary
Shares, the rights under the Rights Plan, unless, prior to any settlement of a
Purchase Contract, the rights have separated from the Ordinary Shares, in which
case the Settlement Rate will be adjusted at the time of separation as if the
Company made a distribution to all holders of its Ordinary Shares as described
in clause (4) above, subject to readjustment in the event of the expiration,
termination or redemption of the rights. For the avoidance of doubt, the
Settlement Rate shall not be adjusted (i) upon the issuance of any Ordinary
Shares pursuant to any present or future plan providing for the reinvestment of
dividends or interest payable on securities of the Company and the investment of
additional optional amounts in Ordinary Shares under any plan, (ii) upon the
issuance of any Ordinary Shares or options or rights to purchase those shares
pursuant to any present or future employee, director or consultant benefit plan
or program of or assumed by the Company or any of its subsidiaries, or (iii)
upon the issuance of any Ordinary Shares pursuant to any option, warrant, right,
or exercisable, exchangeable or convertible security outstanding as of the date
the Units were first issued.
(b) Adjustment for Consolidation, Merger or Other
Reorganization Event. In the event of
(1) any consolidation or merger of the Company with or into
another Person (other than a merger or consolidation in which the Company is the
continuing corporation and in which the Ordinary Shares outstanding immediately
prior to the merger or consolidation are not exchanged for cash, securities
other property of the Company or another corporation),
(2) any sale, transfer, lease or conveyance to another Person
of the property of the Company as an entirety or substantially as an entirety,
(3) any statutory exchange of securities of the Company with
another Person (other than in connection with a merger or acquisition), or
(4) any liquidation, dissolution or winding up of the Company
other than as a result of or after the occurrence of a Termination Event (any
such event, a "Reorganization Event"),
53
each Ordinary Share covered by each Purchase Contract forming part of a Unit
immediately prior to such Reorganization Event shall, after such Reorganization
Event, be converted for purposes of the Purchase Contract into the kind and
amount of securities, cash and other property receivable in such Reorganization
Event (without any interest thereon, and without any right to dividends or
distribution thereon which have a record date that is prior to the Stock
Purchase Date) per Ordinary Share by a holder of Ordinary Shares that (i) is not
a Person with which the Company consolidated or into which the Company merged or
which merged into the Company or to which such sale or transfer was made, as the
case may be (any such Person, a "Constituent Person"), or an Affiliate of a
Constituent Person to the extent such Reorganization Event provides for
different treatment of Ordinary Shares held by Affiliates of the Company and
non-Affiliates, and (ii) failed to exercise his rights of election, if any, as
to the kind or amount of securities, cash and other property receivable upon
such Reorganization Event (provided that if the kind or amount of securities,
cash and other property receivable upon such Reorganization Event is not the
same for each Ordinary Share held immediately prior to such Reorganization Event
by a Person other than a Constituent Person or an Affiliate thereof and in
respect of which such rights of election shall not have been exercised
("Non-electing Share"), then for the purpose of this Section the kind and amount
of securities, cash and other property receivable upon such Reorganization Event
by each Non-electing Share shall be deemed to be the kind and amount so
receivable per Ordinary Share by a plurality of the Non-electing Shares). On the
Stock Purchase Date, the Settlement Rate then in effect will be applied to the
value on the Stock Purchase Date of such securities, cash or other property.
In the event of such a Reorganization Event, the Person formed
by such consolidation, merger or exchange or the Person which acquires the
assets of the Company or, in the event of a liquidation or dissolution of the
Company, the Company or a liquidating trust created in connection therewith,
shall execute and deliver to the Agent an agreement supplemental hereto
providing that the Holder of each Outstanding Unit shall have the rights
provided by this Section 5.6. Such supplemental agreement shall provide for
adjustments which, for events subsequent to the effective date of such
supplemental agreement, shall be as nearly equivalent as may be practicable to
the adjustments provided for in this Section. The above provisions of this
Section shall similarly apply to successive Reorganization Events.
SECTION 5.7. NOTICE OF ADJUSTMENTS AND CERTAIN OTHER EVENTS.
(a) Whenever the Settlement Rate is adjusted as herein
provided or the Settlement Rate is fixed pursuant to Section 5.1(f), the Company
shall:
(i) forthwith compute the Settlement Rate and the
Applicable Market Value in accordance with Section 5.6 or in the case of
a fixing of the Settlement Rate pursuant to Section 5.1(f) and prepare
and transmit to the Agent an Officers' Certificate setting forth the
Settlement Rate and the Applicable Market Value or the Fixed Settlement
Rate, as the case may be, the method of calculation thereof in
reasonable detail, and the facts requiring such adjustment and upon
which such adjustment is based (which Officers' Certificate, in the case
of the fixing of the Settlement Rate pursuant to Section 5.1(f) shall be
delivered by such time and date as specified in Section 5.1(f)); and
54
(ii) as soon as practicable following the occurrence of an
event that requires an adjustment to the Settlement Rate pursuant to
Section 5.6 (or if the Company is not aware of such occurrence, as soon
as practicable after becoming so aware), provide a written notice to the
Agent of the occurrence of such event and a statement setting forth in
reasonable detail the method by which the adjustment to the Settlement
Rate and the Applicable Market Value or the Settlement Rate was fixed
was determined and setting forth the adjusted Settlement Rate and the
Applicable Market Value or the Fixed Settlement Rate, as the case may
be.
(b) The Agent shall not at any time be under any duty or
responsibility to any Holder of Units to determine whether any facts exist which
may require any adjustment of the Settlement Rate and the Applicable Market
Value, or with respect to the nature or extent or calculation of any such
adjustment when made, or with respect to the method employed in making the same.
The Agent shall not be accountable with respect to the validity or value (or the
kind or amount) of any Ordinary Shares, or of any securities or property, which
may at the time be issued or delivered with respect to any Purchase Contract,
and the Agent makes no representation with respect thereto. The Agent shall not
be responsible for any failure of the Company to issue, transfer or deliver any
Ordinary Shares pursuant to a Purchase Contract or to comply with any of the
duties, responsibilities or covenants of the Company contained in this Article.
SECTION 5.8. TERMINATION EVENT; NOTICE.
The Purchase Contracts and all obligations and rights of the
Company and the Holders thereunder, including, without limitation, the rights of
Holders to receive Contract Adjustment Payments, if any, or any Deferred
Contract Adjustment Payments and obligations of Holders to purchase Ordinary
Shares, shall immediately and automatically terminate, without the necessity of
any notice or action by any Holder, the Agent or the Company, if, on or prior to
the Stock Purchase Date, a Termination Event shall have occurred. Upon and after
the occurrence of a Termination Event, the Normal Units shall thereafter
represent the right to receive the Notes or the Treasury Consideration, as the
case may be, forming a part of such Normal Units, and the Stripped Units shall
thereafter represent the right to receive the Treasury Securities forming a part
of such Stripped Units, in each case in accordance with the provisions of
Section 4.3 of the Pledge Agreement. Upon the occurrence of a Termination Event,
the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Agent, the Collateral Agent and to the
Holders, at their addresses as they appear in the Register.
SECTION 5.9. EARLY SETTLEMENT. (a) Subject to and upon compliance with
the provisions of this Section 5.9, Purchase Contracts underlying Units having
an aggregate Stated Amount equal to $1,000 or an integral multiple thereof may,
at the option of the Holder thereof, be settled early ("Early Settlement") on or
prior to 10:00 a.m., New York City time, on the thirteenth Business Day
immediately preceding the Stock Purchase Date. Holders of Stripped Units may
only effect Early Settlement of the related Purchase Contracts in integral
multiples of 40 Stripped Units, and if Treasury Consideration has been
substituted for the Notes as a component in the Normal Units due to the
occurrence of a Special Event Redemption, Purchase Contracts underlying such
Normal Units may only be settled early in integral multiples of
55
Normal Units such that the Treasury Consideration to be deposited and the
Treasury Consideration to be released are in integral multiples of $1,000. In
order to exercise the right to effect Early Settlement with respect to any
Purchase Contracts, the Holder of the Certificate evidencing the related Units
shall deliver such Certificate to the Agent at the Corporate Trust Office duly
endorsed for transfer to the Company or in blank with the form of Election to
Settle Early on the reverse thereof duly completed and accompanied by payment
payable to the Company in immediately available funds in an amount (the "Early
Settlement Amount") equal to (A) the product of (i) the Purchase Price
multiplied by (ii) the number of Purchase Contracts with respect to which the
Holder has elected to effect Early Settlement, plus (B) if such delivery is made
with respect to any Purchase Contracts during the period from the close of
business on any Record Date next preceding any Payment Date to the opening of
business on such Payment Date, an amount equal to the Contract Adjustment
Payments, if any, payable on such Payment Date with respect to such Purchase
Contracts; provided that no payment shall be required pursuant to clause (B) of
this sentence if the Company shall have elected to defer the Contract Adjustment
Payments which would otherwise be payable on such Payment Date. Except as
provided in the immediately preceding sentence and subject to Section 5.2(d), no
payment or adjustment shall be made upon Early Settlement of any Purchase
Contract on any Contract Adjustment Payments accrued on such Purchase Contract
or on account of any dividends on the Ordinary Shares issued upon such Early
Settlement. If the foregoing requirements are first satisfied with respect to
Purchase Contracts underlying any Unit at or prior to 5:00 p.m., New York City
time, on a Business Day, such day shall be the "Early Settlement Date" with
respect to such Unit and if such requirements are first satisfied after 5:00
p.m., New York City time, on a Business Day or on a day that is not a Business
Day, the "Early Settlement Date" with respect to such Units shall be the next
succeeding Business Day.
(b) Upon Early Settlement of any Purchase Contract by the
Holder of the related Units, the Company shall issue, and the Holder shall be
entitled to receive, 0.2660 Ordinary Shares on account of such Purchase Contract
(the "Early Settlement Rate"), or, if the Company has fixed the Settlement Rate
pursuant to Section 5.1(f) of this Agreement, the Fixed Settlement Rate. The
Early Settlement Rate shall be adjusted in the same manner and at the same time
as the Settlement Rate is adjusted pursuant to Section 5.6. As promptly as
practicable after Early Settlement of Purchase Contracts in accordance with the
provisions of this Section 5.9, the Company shall issue and shall deliver to the
Agent at the Corporate Trust Office a certificate or certificates for the full
number of Ordinary Shares issuable upon such Early Settlement together with
payment in lieu of any fraction of a share, as provided in Section 5.12.
(c) No later than the third Business Day after the applicable
Early Settlement Date the Company shall cause (i) the Ordinary Shares issuable
upon Early Settlement of Purchase Contracts to be issued and delivered, and (ii)
the related Pledged Notes or Pledged Treasury Consideration, in the case of
Normal Units, or the related Pledged Treasury Securities, in the case of
Stripped Units, to be released from the Pledge by the Collateral Agent and
transferred, in each case, to the Agent for delivery to the Holder thereof or
the Holder's designee.
(d) Upon Early Settlement of any Purchase Contracts, and
subject to receipt of Ordinary Shares from the Company and the Pledged Notes,
Pledged Treasury Consideration or Pledged Treasury Securities, as the case may
be, from the Collateral Agent, as applicable, the Agent shall, in accordance
with the instructions provided by the Holder thereof on the applicable
56
form of Election to Settle Early on the reverse of the Certificate evidencing
the related Units, (i) transfer to the Holder the Pledged Notes, Pledged
Treasury Consideration or Pledged Treasury Securities, as the case may be,
forming a part of such Units, and (ii) deliver to the Holder a certificate or
certificates for the full number of Ordinary Shares issuable upon such Early
Settlement together with payment in lieu of any fraction of a share, as provided
in Section 5.12.
(e) In the event that Early Settlement is effected with
respect to Purchase Contracts underlying less than all the Units evidenced by a
Certificate, upon such Early Settlement the Company shall execute and the Agent
shall authenticate, execute on behalf of the Holder and deliver to the Holder
thereof, at the expense of the Company, a Certificate evidencing the Units as to
which Early Settlement was not effected.
(f) No Early Settlement will be permitted under this Section
5.9 unless, at the time of delivery of the Election to Settle Early form or the
time the Early Settlement is effected, there is an effective shelf or other
registration statement with respect to the Ordinary Shares to be issued and
delivered in connection with such Early Settlement unless the Company has been
advised by counsel that no such registration statement is required under the
Securities Act or that no prospectus is required to be delivered in connection
therewith. In addition, the Company may suspend the use of any such prospectus
up to four times in any 360-day period not to exceed 90 days in any such 360-day
period if (i) any such prospectus would, in the Company's judgment, contain a
material misstatement or omission as a result of an event that has occurred and
is continuing or as a result of any proposed or pending material business
transaction, event or announcement; and (ii) the Company reasonably determines
that the disclosure of such material non-public information could have a
material adverse effect on the Company and its subsidiaries taken as a whole or
could impede the consummation of any proposed or pending material business
transaction.
(g) If, to effect an Early Settlement, the United States
federal securities law so require, the Company will use commercially reasonable
efforts to (i) have in effect a registration statement covering the Ordinary
Shares to be delivered in respect of the Purchase Contracts being settled and
(ii) provided a prospectus in connection therewith, in each case that maybe used
in connection with such Early Settlement.
SECTION 5.10. EARLY SETTLEMENT UPON CASH MERGER. (a) In the event of a
merger or consolidation of the Company of the type described in clause (1) of
Section 5.6(b) in which the Ordinary Shares outstanding immediately prior to
such merger or consolidation are exchanged for consideration consisting of at
least 30% cash or cash equivalents (any such event a "Cash Merger"), then the
Company (or the successor to the Company hereunder) shall be required to offer
the Holder of each Unit the right to settle the Purchase Contract underlying
such Unit prior to the Stock Purchase Date ("Merger Early Settlement") as
provided herein. On or before the fifth Business Day after the consummation of a
Cash Merger, the Company or, at the request and expense of the Company, the
Agent, shall give all Holders notice of the occurrence of the Cash Merger and of
the right of Merger Early Settlement arising as a result thereof. The Company
shall also deliver a copy of such notice to the Agent and the Collateral Agent.
Each such notice shall contain:
57
(i) the date, which shall be not less than 20 or more than
30 calendar days after the date of such notice, on which the
Merger Early Settlement will be effected (the "Merger Early
Settlement Date");
(ii) the date, which shall be on or one Business Day prior
to the Merger Early Settlement Date, by which the Merger Early
Settlement right must be exercised;
(iii) the Settlement Rate in effect as a result of such
Cash Merger and the kind and amount of securities, cash and
other property receivable by the Holder upon settlement of
each Purchase Contract pursuant to Section 5.6(b);
(iv) a statement to the effect that all or a portion of the
Purchase Price payable by the Holder to settle the Purchase
Contract will be offset against the amount of cash so
receivable upon exercise of Merger Early Settlement, as
applicable; and
(v) the instructions a Holder must follow to exercise the
Merger Early Settlement right.
(b) To exercise a Merger Early Settlement right, a Holder
shall deliver to the Agent at the Corporate Trust Office on or before 5:00 p.m.,
New York City time, on the date specified in the notice the Certificate(s)
evidencing the Units with respect to which the Merger Early Settlement right is
being exercised duly endorsed for transfer to the Company or in blank with the
form of Election to Settle Early on the reverse thereof duly completed and
accompanied by payment payable to the Company in immediately available funds in
an amount equal to the Early Settlement Amount less the amount of cash that
otherwise would be deliverable by the Company or its successor upon settlement
of the Purchase Contract in lieu of Ordinary Shares pursuant to Section 5.6(b)
and as described in the notice to Holders (the "Merger Early Settlement
Amount").
(c) On the Merger Early Settlement Date, the Company shall
deliver or cause to be delivered (i) the net cash, securities and other property
to be received by such exercising Holder, equal to the Settlement Rate or if the
Company has fixed the Settlement Rate pursuant to Section 5.1(f), the Fixed
Settlement Rate, as adjusted pursuant to Section 5.6, in respect of the number
of Purchase Contracts for which such Merger Early Settlement right was
exercised, and (ii) the related Pledged Notes or Pledged Treasury Consideration,
in the case of Normal Units, or Pledged Treasury Securities, in the case of
Stripped Units, to be released from the Pledge by the Collateral Agent and
transferred, in each case, to the Corporate Trust Office for delivery to the
Holder thereof or its designee. In the event a Merger Early Settlement right
shall be exercised by a Holder in accordance with the terms hereof, all
references herein to Stock Purchase Date shall be deemed to refer to such Merger
Early Settlement Date. If a Holder effects a Merger Early Settlement of some or
all of its Purchase Contracts, such Holder shall be entitled to receive, on the
Merger Early Settlement Date, the aggregate amount of any Deferred Contract
Adjustment Payments and any accumulated and unpaid Contract Adjustment Payments
since the immediately preceding Payment Date with respect to such Purchase
Contracts. The Company
58
shall pay such amount as a credit against the amount otherwise payable by the
Holders to effect such Specified Merger Early Settlement and in any remainder in
the form of a cash payment.
(d) Upon Merger Early Settlement of any Purchase Contracts,
and subject to receipt of such net cash, securities or other property from the
Company and the Pledged Notes, Pledged Treasury Consideration or Pledged
Treasury Securities, as the case may be, from the Collateral Agent, as
applicable, the Agent shall, in accordance with the instructions provided by the
Holder thereof on the applicable form of Election to Settle Early on the reverse
of the Certificate evidencing the related Units, (i) transfer to the Holder the
Pledged Notes, Pledged Treasury Consideration or Pledged Treasury Securities, as
the case may be, forming a part of such Units, and (ii) deliver to the Holder
such net cash, securities or other property issuable upon such Merger Early
Settlement together with payment in lieu of any fraction of a share, as provided
in Section 5.12.
(e) In the event that Merger Early Settlement is effected with
respect to Purchase Contracts underlying less than all the Units evidenced by a
Certificate, upon such Merger Early Settlement the Company (or the successor to
the Company hereunder) shall execute and the Agent shall authenticate, execute
on behalf of the Holder and deliver to the Holder thereof, at the expense of the
Company, a Certificate evidencing the Units as to which Merger Early Settlement
was not effected.
SECTION 5.11. CHARGES AND TAXES.
The Company will pay all stock transfer and similar taxes
attributable to the initial issuance and delivery of the Ordinary Shares
pursuant to the Purchase Contracts and in payment of any Deferred Contract
Adjustment Payments; provided that the Company shall not be required to pay any
such tax or taxes which may be payable in respect of any exchange of or
substitution for a Certificate evidencing a Unit or any issuance of a Ordinary
Share in a name other than that of the registered Holder of a Certificate
surrendered in respect of the Units evidenced thereby, other than in the name of
the Agent, as custodian for such Holder, and the Company shall not be required
to issue or deliver such Certificate or Ordinary Share unless and until the
Person or Persons requesting the transfer or issuance thereof shall have paid to
the Company the amount of such tax or shall have established to the satisfaction
of the Company that such tax has been paid.
SECTION 5.12. NO FRACTIONAL SHARES.
No fractional shares or scrip representing fractional Ordinary
Shares shall be issued or delivered upon settlement on the Stock Purchase Date
or upon Early Settlement or Merger Early Settlement of any Purchase Contracts.
If Certificates evidencing more than one Purchase Contract shall be surrendered
for settlement at one time by the same Holder, the number of full Ordinary
Shares which shall be delivered upon settlement shall be computed on the basis
of the aggregate number of Purchase Contracts evidenced by the Certificates so
surrendered. Instead of any fractional Ordinary Share which would otherwise be
deliverable upon settlement of any Purchase Contracts on the applicable
Settlement Date or upon Early Settlement or Merger Early Settlement, the
Company, through the Agent, shall make a cash payment in respect of such
fractional shares in an amount equal to the value of such fractional
59
shares times the Applicable Market Value. The Company shall provide the Agent
from time to time with sufficient funds to permit the Agent to make all cash
payments required by this Section 5.12 in a timely manner.
ARTICLE VI
REMEDIES
SECTION 6.1. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PURCHASE
CONTRACT ADJUSTMENT PAYMENTS AND PURCHASE ORDINARY SHARES.
The Holder of any Unit shall have the right, which is absolute
and unconditional,
(a) subject to the right of the Company to defer payment
thereof pursuant to Section 5.3, and to the forfeiture of any Deferred Contract
Adjustment Payments upon Early Settlement pursuant to Section 5.9 or upon the
occurrence of a Termination Event, to receive payment of each installment of the
Contract Adjustment Payments, if any, with respect to the Purchase Contract
constituting a part of such Unit on the respective Payment Date for such Unit,
and to institute suit for the enforcement of such right to receive Contract
Adjustment Payments, and
(b) to purchase Ordinary Shares pursuant to the Purchase
Contract constituting a part of such Unit and to institute suit for the
enforcement of any such right to purchase Ordinary Shares, and such rights shall
not be impaired without the consent of such Holder.
SECTION 6.2. RESTORATION OF RIGHTS AND REMEDIES.
If any Holder has instituted any proceeding to enforce any
right or remedy under this Agreement and such proceeding has been discontinued
or abandoned for any reason, or has been determined adversely to such Holder,
then and in every such case, subject to any determination in such proceeding,
the Company and such Holder shall be restored severally and respectively to
their former positions hereunder and thereafter all rights and remedies of such
Holder shall continue as though no such proceeding had been instituted.
SECTION 6.3. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Certificates in Section
3.10(f), no right or remedy herein conferred upon or reserved to the Holders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
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SECTION 6.4. DELAY OR OMISSION NOT WAIVER.
No delay or omission of any Holder to exercise any right or
remedy upon a default shall impair any such right or remedy or constitute a
waiver of any such right. Every right and remedy given by this Article or by law
to the Holders may be exercised from time to time, and as often as may be deemed
expedient, by such Holders.
SECTION 6.5. UNDERTAKING FOR COSTS.
All parties to this Agreement agree, and each Holder of a
Unit, by its acceptance of such Unit shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Agreement, or in any suit against the Agent for any
action taken, suffered or omitted by it as Agent, the filing by any party
litigant in such suit of an undertaking to pay the costs of such suit, and that
such court may in its discretion assess reasonable costs, including reasonable
attorneys' fees, against any party litigant in such suit, having due regard to
the merits and good faith of the claims or defenses made by such party litigant;
provided that the provisions of this Section shall not apply to any suit
instituted by the Company, to any suit instituted by the Agent, to any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% of the Outstanding Units, or to any suit instituted by any Holder for
the enforcement of distributions on any Notes or Contract Adjustment Payments,
if any, on any Purchase Contract on or after the respective Payment Date
therefor in respect of any Unit held by such Holder, or for enforcement of the
right to purchase Ordinary Shares under the Purchase Contract constituting part
of any Unit held by such Holder.
SECTION 6.6. WAIVER OF STAY OR EXTENSION LAWS.
The Company covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, or plead, or in any manner
whatsoever claim or take the benefit or advantage of, any stay or extension law
wherever enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of this Agreement; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law, but will suffer and permit the execution of every such power as
though no such law had been enacted.
ARTICLE VII
THE AGENT
SECTION 7.1. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) The Agent shall act as agent and attorney-in-fact for the
Holders of the Normal Units and Stripped Units hereunder with such powers as are
specifically vested in the Agent by the terms of this Agreement, the Pledge
Agreement, the Remarketing Agreement, the Notes, the Normal Units and Stripped
Units, and any documents evidencing them or related thereto, together with such
other powers as are reasonably incidental thereto. The Agent:
(1) undertakes to perform, with respect to the Units and
Separate Notes, such duties and only such duties as are specifically set forth
in this Agreement and the Pledge
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Agreement, and no implied covenants or obligations shall be read into this
Agreement against the Agent; and
(2) in the absence of bad faith, willful misconduct or
negligence on its part, the Agent may, with respect to the Units and Separate
Notes, conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished to
the Agent reasonably believed by the Agent to be genuine and correct and
conforming to the requirements of this Agreement, but in the case of any
certificates or opinions which by any provision hereof are specifically required
to be furnished to the Agent, the Agent shall be under a duty to examine the
same to determine whether or not they conform to the requirements of this
Agreement (but need not confirm or investigate the accuracy of the mathematical
calculations or other facts stated therein).
(b) No provision of this Agreement shall be construed to
relieve the Agent from liability for its own negligent action, its own negligent
failure to act, its own bad faith or its own willful misconduct, except that:
(1) this paragraph (b) shall not be construed to limit the
effect of paragraph (a) of this Section;
(2) the Agent shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved that the
Agent was negligent in ascertaining the pertinent facts; and
(3) no provision of this Agreement shall require the Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers.
(c) Whether or not therein expressly so provided, every
provision of this Agreement relating to the conduct or affecting the liability
of or affording protection to the Agent shall be subject to the provisions of
this Section.
(d) The Agent is authorized to execute and deliver the Pledge
Agreement in its capacity as Agent.
SECTION 7.2. NOTICE OF DEFAULT.
Within 30 days after the occurrence of any default by the
Company hereunder or under a Purchase Contract of which a Responsible Officer of
the Agent has actual knowledge, the Agent shall transmit by mail to the Company
and the Holders of Units, as their names and addresses appear in the applicable
Register, notice of such default hereunder, unless such default shall have been
cured or waived.
SECTION 7.3. CERTAIN RIGHTS OF AGENT. Subject to the provisions of
Section 7.1:
(a) the Agent may conclusively rely and shall be fully
protected in acting or refraining from acting upon any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness
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or other paper or document reasonably believed by it to be genuine and to have
been signed or presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by an Officers' Certificate, Issuer Order or
Issuer Request, and any resolution of the Board of Directors of the Company may
be sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Agreement the Agent
shall deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Agent (unless other evidence be
herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate of the Company;
(d) the Agent may consult with counsel and the advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(e) the Agent shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document, but
the Agent, in its discretion, may make reasonable further inquiry or
investigation into such facts or matters related to the execution, delivery and
performance of the Purchase Contracts as it may see fit, and, if the Agent shall
determine to make such further inquiry or investigation, it shall be given a
reasonable opportunity to examine the books, records and premises of the
Company, personally or by agent or attorney;
(f) the Agent may execute any of the powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys or an Affiliate of the Agent and the Agent shall not be responsible
for any misconduct or negligence on the part of any agent or attorney or an
affiliate of the Agent appointed with due care hereunder;
(g) the Agent shall be under no obligation to exercise any of
the rights or powers vested in it by this Agreement solely at the request or
direction of any of the Holders pursuant to this Agreement, unless such Holders
shall have offered to the Agent security or indemnity reasonably satisfactory to
the Agent against the costs, expenses and liabilities which might be incurred by
it in compliance with such request or direction;
(h) the Agent shall not be deemed to have notice of any
default unless a Responsible Officer of the Agent has actual knowledge thereof
or unless written notice of any event which is in fact such a default is
received by the Agent at the Corporate Trust Office of the Agent, and such
notice references the Units and this Agreement and states that it is a notice of
default; and
(i) the Agent may request that the Company deliver an
Officers' Certificate setting forth the names of individuals and/or titles of
officers authorized at such time to take specified actions pursuant to this
Agreement, which Officers' Certificate may be signed by any person authorized to
sign an Officers' Certificate, including any person specified as so authorized
in any such Certificate previously delivered and not superseded.
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SECTION 7.4. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF UNITS.
The recitals contained herein and in the Certificates shall be
taken as the statements of the Company and the Agent assumes no responsibility
for their accuracy. The Agent makes no representations as to the validity or
sufficiency of either this Agreement or of the Units, or of the Pledge Agreement
or the Pledge. The Agent shall not be accountable for the use or application by
the Company of the Units or the proceeds therefrom or in respect of the Purchase
Contracts.
SECTION 7.5. MAY HOLD UNITS.
Any Registrar or any other agent of the Company, or the Agent
and its Affiliates, in their individual or any other capacity, may become the
owner or pledgee of Units and may otherwise deal with the Company, the
Collateral Agent or any other Person with the same rights it would have if it
were not Registrar or such other agent, or the Agent.
SECTION 7.6. MONEY HELD IN CUSTODY.
Money held by the Agent in custody hereunder need not be
segregated from the Agent's other funds except to the extent required by law or
provided herein. The Agent shall be under no obligation to invest or pay
interest on any money received by it hereunder except as otherwise agreed in
writing with the Company.
SECTION 7.7. COMPENSATION AND REIMBURSEMENT. The Company agrees:
(a) to pay to the Agent from time to time reasonable
compensation for all services rendered by it hereunder;
(b) except as otherwise expressly provided herein, to
reimburse the Agent upon its request for all reasonable expenses, disbursements
and advances incurred or made by the Agent in accordance with any provision of
this Agreement (including the reasonable compensation and the reasonable
expenses and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence, willful
misconduct or bad faith; and
(c) to indemnify the Agent and any predecessor Agent, their
officers, directors, employees and agents for, and to hold it harmless against,
any loss, liability or expense incurred without gross negligence, willful
misconduct or bad faith on its part, arising out of or in connection with the
acceptance or administration of its duties hereunder, including the costs and
expenses of defending itself against any claim or liability in connection with
the exercise or performance of any of its powers or duties hereunder. The Agent
shall promptly notify the Company of any third-party claim which may give rise
to the indemnity hereunder and give the Company the opportunity to control 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.
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For purposes of this Section 7.7, "Agent" shall include any
predecessor Agent; provided that the negligence, bad faith or willful misconduct
of any Agent hereunder shall not affect the rights of any other Agent hereunder.
The provisions of this Section 7.7 shall survive the
termination of this Agreement, the satisfaction or discharge of the Units and/or
the Separate Notes and/or the resignation or removal of the Agent.
The Company will also pay all fees and expenses relating to
the enforcement by the Agent of the rights of the Holders of the Purchase
Contracts and the retention of the Collateral Agent.
In no event shall the Agent be liable for any indirect,
special, punitive or consequential loss or damage of any kind whatsoever,
including, but not limited to, lost profits, even if the Agent has been advised
of the likelihood of such loss or damage and regardless of the form of action.
In no event shall the Agent be liable for any failure or delay
in the performance of its obligations hereunder because of circumstances beyond
its control, including, but not limited to, acts of God, flood, war (whether
declared or undeclared), terrorism, fire, riot, embargo, government action,
including any laws, ordinances, regulations, governmental action or the like
which delay, restrict or prohibit the providing of services contemplated by this
Agreement.
SECTION 7.8. CORPORATE AGENT REQUIRED; ELIGIBILITY.
There shall at all times be an Agent hereunder which shall be
a corporation organized and doing business under the laws of the United States
of America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having (or being a member of a bank
holding company having) a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by federal or state authority and having a
Corporate Trust Office in the Borough of Manhattan, The City of New York, if
there be such a corporation, qualified and eligible under this Article and
willing to act on reasonable terms. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Agent shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.
SECTION 7.9. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR. (a) No
resignation or removal of the Agent and no appointment of a successor Agent
pursuant to this Article shall become effective until the acceptance of
appointment by the successor Agent in accordance with the applicable
requirements of Section 7.10.
(b) The Agent may resign at any time by giving written notice
thereof to the Company 60 days prior to the effective date of such resignation.
If the instrument of acceptance by a successor Agent required by Section 7.10
shall not have been delivered to the Agent within
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30 days after the giving of such notice of resignation, the resigning Agent may
petition any court of competent jurisdiction for the appointment of a successor
Agent.
(c) The Agent may be removed at any time by Act of the Holders
of a majority in number of the Outstanding Units delivered to the Agent and the
Company.
(d) If at any time:
(1) the Agent fails to comply with Section 310(b) of the TIA,
as if the Agent were an indenture trustee under an indenture qualified under the
TIA, after written request therefor by the Company or by any Holder who has been
a bona fide Holder of a Unit for at least six months; or
(2) the Agent shall cease to be eligible under Section 7.8 and
shall fail to resign after written request therefor by the Company or by any
such Holder; or
(3) the Agent shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Agent or of its property
shall be appointed or any public officer shall take charge or control of the
Agent or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation;
then, in any such case, (x) the Company by a Board Resolution may remove the
Agent, or (y) any Holder who has been a bona fide Holder of a Unit for at least
six months may, on behalf of himself and all others similarly situated, petition
any court of competent jurisdiction for the removal of the Agent and the
appointment of a successor Agent.
(e) If the Agent shall resign, be removed or become incapable
of acting, or if a vacancy shall occur in the office of Agent for any reason,
the Company, by a Board Resolution, shall promptly appoint a successor Agent and
shall comply with the applicable requirements of Section 7.10. If no successor
Agent shall have been so appointed by the Company and accepted appointment in
the manner required by Section 7.10, any Holder who has been a bona fide Holder
of a Unit for at least six months may, on behalf of itself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Agent.
(f) The Company shall give, or shall cause such successor
Agent to give, notice of each resignation and each removal of the Agent and each
appointment of a successor Agent by mailing written notice of such event by
first-class mail, postage prepaid, to all Holders as their names and addresses
appear in the applicable Register. Each notice shall include the name of the
successor Agent and the address of its Corporate Trust Office.
SECTION 7.10. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. (a) In case of
the appointment hereunder of a successor Agent, every such successor Agent so
appointed shall execute, acknowledge and deliver to the Company and to the
retiring Agent an instrument accepting such appointment, and thereupon the
resignation or removal of the retiring Agent shall become effective and such
successor Agent, without any further act, deed or conveyance, shall become
vested with all the rights, powers, agencies and duties of the retiring Agent.
On the request of the Company or the successor Agent, such retiring Agent shall,
upon payment of its charges, execute and deliver an instrument transferring to
such successor Agent all the rights,
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powers and trusts of the retiring Agent and shall duly assign, transfer and
deliver to such successor Agent all property and money held by such retiring
Agent hereunder.
(b) Upon request of any such successor Agent, the Company
shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Agent all such rights, powers and agencies
referred to in paragraph (a) of this Section.
No successor Agent shall accept its appointment unless at the
time of such acceptance such successor Agent shall be qualified and eligible
under this Article.
SECTION 7.11. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS.
Any Person into which the Agent may be merged or converted or
with which it may be consolidated, or any Person resulting from any merger,
conversion or consolidation to which the Agent shall be a party, or any Person
succeeding to all or substantially all the corporate trust business of the
Agent, shall be the successor of the Agent hereunder, provided such Person shall
be otherwise qualified and eligible under this Article, without the execution or
filing of any paper or any further act on the part of any of the parties hereto.
In case any Certificates shall have been authenticated and executed on behalf of
the Holders, but not delivered, by the Agent then in office, any successor to
such
Agent shall adopt such authentication and execution and
deliver the Certificates so authenticated and executed with the same effect as
if such successor Agent had itself authenticated and executed such Units.
SECTION 7.12. PRESERVATION OF INFORMATION.
The Agent shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders received by the Agent
in its capacity as Registrar.
SECTION 7.13. NO OBLIGATIONS OF AGENT.
Except to the extent otherwise provided in this Agreement, the
Agent assumes no obligation and shall not be subject to any liability under this
Agreement, the Pledge Agreement or any Purchase Contract in respect of the
obligations of the Holder of any Unit thereunder. The Company agrees, and each
Holder of a Certificate, by such Holder's acceptance thereof, shall be deemed to
have agreed, that the Agent's execution of the Certificates on behalf of the
Holders shall be solely as agent and attorney-in-fact for the Holders, and that
the Agent shall have no obligation to perform such Purchase Contracts on behalf
of the Holders, except to the extent expressly provided in Article V.
SECTION 7.14. TAX COMPLIANCE. (a) The Agent, on its own behalf and on
behalf of the Company, will comply with all applicable certification,
information reporting and withholding (including "backup" withholding)
requirements imposed by applicable tax laws, regulations or administrative
practice with respect to (i) any payments made with respect to the Units or (ii)
the issuance, delivery, holding, transfer, redemption or exercise of rights
under the Units. Such compliance shall include, without limitation, the
preparation and timely filing of required returns and the timely payment of all
amounts required to be withheld to the appropriate taxing authority
67
or its designated agent. For purposes of United States backup withholding tax
and information reporting requirements, each Holder will provide the Agent with
an executed copy of Internal Revenue Service Form W-9 (for United States
persons) or Form W-8 (for non-United States persons) or any successor forms.
(b) The Agent shall comply with any reasonable written direction timely
received from the Company with respect to the execution or certification of any
required documentation and the application of such requirements to particular
payments or Holders or in other particular circumstances, and may for purposes
of this Agreement conclusively rely on any such direction in accordance with the
provisions of Section 7.1(a)(2).
(c) The Agent shall maintain all appropriate records documenting
compliance with such requirements, and shall make such records available, on
written request, to the Company or its authorized representative within a
reasonable period of time after receipt of such request.
ARTICLE VIII
SUPPLEMENTAL AGREEMENTS
SECTION 8.1. SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company and the Agent,
at any time and from time to time, may enter into one or more agreements
supplemental hereto, in form satisfactory to the Company and the Agent, for any
of the following purposes:
(a) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of the
Company herein and in the Certificates; or
(b) to add to the covenants of the Company for the benefit of
the Holders, or to surrender any right or power herein conferred upon the
Company (provided such covenants or such surrender shall not adversely affect
the validity, perfection or priority of the security interests granted or
created under the Pledge Agreement); or
(c) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(d) to make provision with respect to the rights of Holders
pursuant to the requirements of Section 5.6(b) or 5.10; or
(e) to cure any ambiguity, to correct or supplement any
provisions herein which may be inconsistent with any other provisions herein, or
to make any other provisions with respect to such matters or questions arising
under this Agreement, provided such action shall not adversely affect the
interests of the Holders; or
(f) to permit the substitution by the Holders of designated
Company debt instruments for the Pledged Notes as Collateral under this
Agreement.
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SECTION 8.2. SUPPLEMENTAL AGREEMENTS WITH CONSENT OF HOLDERS(a) With
the consent of the Holders of not less than a majority of the outstanding
Purchase Contracts voting together as one class, by Act of said Holders
delivered to the Company and the Agent, the Company, when authorized by a Board
Resolution, and the Agent may enter into an agreement or agreements supplemental
hereto, in form satisfactory to the Company and the Agent, for the purpose of
modifying in any manner the terms of the Purchase Contracts, or the provisions
of this Agreement or the rights of the Holders in respect of the Units; provided
that, except as contemplated herein, no such supplemental agreement shall,
without the consent of the Holder of each Outstanding Unit affected thereby:
(1) change any Payment Date;
(2) change the amount or the type of Collateral required to be
Pledged to secure a Holder's obligations under the Purchase Contract, impair the
right of the Holder of any Purchase Contract or Unit to receive distributions on
the related Collateral (except as provided in Section 8.1(f) above and except
for the rights of Holders of Normal Units to substitute the Treasury Securities
for the Pledged Notes or Pledged Treasury Consideration or the rights of holders
of Stripped Units to substitute Notes or Treasury Consideration for the Pledged
Treasury Securities) or otherwise materially adversely affect the Holder's
rights in or to such Collateral;
(3) reduce any Contract Adjustment Payments or any Deferred
Contract Adjustment Payment, or change any place where, or the coin or currency
in which, any Contract Adjustment Payment or other payment under this Agreement
is payable or increase any amounts payable by the Holders in respect of the
Units or decrease any other amounts receivable by Holders in respect of the
Units;
(4) impair the right to institute suit for the enforcement of
any Purchase Contract, any Contract Adjustment Payment, if any, or any Deferred
Contract Adjustment Payment, if any;
(5) reduce the number of Ordinary Shares to be purchased
pursuant to any Purchase Contract, increase the price to purchase Ordinary
Shares upon settlement of any Purchase Contract, change the Stock Purchase Date
or otherwise materially adversely affect the Holder's rights under any Purchase
Contract; or
(6) reduce the percentage of the outstanding Purchase
Contracts the consent of whose Holders is required for any such supplemental
agreement;
provided that if any amendment or proposal referred to above would adversely
affect only the Normal Units or the Stripped Units, then only the affected class
of Holder as of the record date for the Holders entitled to vote thereon will be
entitled to vote on or consent to 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; provided, however, that no such agreement,
whether with or without the consent of Holders, shall affect Section 3.16; and
provided, further, that the unanimous consent of the Holders of each outstanding
Unit of such class affected thereby shall be required to approve any amendment
or proposal specified in clauses (1) through (6) above.
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(b) It shall not be necessary for any Act of Holders under
this Section to approve the particular form of any proposed supplemental
agreement, but it shall be sufficient if such Act shall approve the substance
thereof.
SECTION 8.3. EXECUTION OF SUPPLEMENTAL AGREEMENTS.
In executing, or accepting the additional agencies created by,
any supplemental agreement permitted by this Article or the modifications
thereby of the agencies created by this Agreement, the Agent shall be entitled
to receive and (subject to Section 7.1) shall be fully protected in relying
upon, an Officer's Certificate and an Opinion of Counsel stating that the
execution of such supplemental agreement is authorized or permitted by this
Agreement and that all conditions precedent to the execution of such
supplemental agreement have been satisfied. The Agent shall enter into any such
supplemental agreement which does not materially adversely affect the Agent's
own rights, duties or immunities under this Agreement or otherwise.
SECTION 8.4. EFFECT OF SUPPLEMENTAL AGREEMENTS.
Upon the execution of any supplemental agreement under this
Article, this Agreement shall be modified in accordance therewith, and such
supplemental agreement shall form a part of this Agreement for all purposes; and
every Holder of Certificates theretofore or thereafter authenticated, executed
on behalf of the Holders and delivered hereunder shall be bound thereby.
SECTION 8.5. REFERENCE TO SUPPLEMENTAL AGREEMENTS.
Certificates authenticated, executed on behalf of the Holders
and delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Agent, bear a notation in form
approved by the Agent as to any matter provided for in such supplemental
agreement. If the Company shall so determine, new Certificates so modified as to
conform, in the opinion of the Agent and the Company, to any such supplemental
agreement may be prepared and executed by the Company and authenticated,
executed on behalf of the Holders and delivered by the Agent in exchange for
Outstanding Certificates.
ARTICLE IX
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.1. COVENANT NOT TO MERGE, CONSOLIDATE, SELL OR CONVEY
PROPERTY EXCEPT UNDER CERTAIN CONDITIONS.
(a) The Company covenants that, so long as any Units are
outstanding, it will not (a) merge with or into or consolidate with any other
Person or (b) transfer, lease or convey all or substantially all its assets to
any Person or buy all or substantially all of the assets of another Person,
unless (i) either the Company shall be the surviving person or the Person (if
other than the Company) formed by such consolidation or into which the Company
is merged or the Person which acquires by conveyance, transfer or lease all or
substantially all of the properties and assets of the Company is an entity
organized and existing under the laws of the United States of America (including
any State thereof or the District of Columbia), the United Kingdom, the
00
Xxxxxx Xxxxxxx, Xxxxxxx or any country which is, on the date of this Agreement,
a member of the Organization of Economic Cooperation and Development or the
European Union and shall expressly assume, all the obligations of the Company
under the Purchase Contracts, this Agreement, the Remarketing Agreement and the
Pledge Agreement by one or more supplemental agreements in form reasonably
satisfactory to the Agent and the Collateral Agent, executed and delivered to
the Agent and the Collateral Agent by such Person, and (ii) the Company or such
successor, as the case may be, shall not, immediately after such merger or
consolidation, or such transfer, lease or conveyance, be in default in the
performance of any covenant or condition hereunder, under any of the Purchase
Contracts, under the Remarketing Agreement or under the Pledge Agreement.
SECTION 9.2. RIGHTS AND DUTIES OF SUCCESSOR CORPORATION. (a) In case of
any such consolidation, merger, transfer, lease, purchase or conveyance and upon
any such assumption by a successor entity in accordance with Section 9.1, such
successor entity shall succeed to and be substituted for the Company with the
same effect as if it had been named herein as the Company. Such successor entity
thereupon may cause to be signed, and may issue either in its own name or in the
name of the Company, any or all of the Certificates evidencing Units issuable
hereunder which theretofore shall not have been signed by the Company and
delivered to the Agent; and, upon the order of such successor corporation,
instead of the Company, and subject to all the terms, conditions and limitations
in this Agreement prescribed, the Agent shall authenticate and execute on behalf
of the Holders and deliver any Certificates which previously shall have been
signed and delivered by the officers of the Company to the Agent for
authentication, execution on behalf of the Holder and delivery, and any
Certificate evidencing Units which such successor entity thereafter shall cause
to be signed and delivered to the Agent for that purpose. All the Certificates
so issued shall in all respects have the same legal rank and benefit under this
Agreement as the Certificates theretofore or thereafter issued in accordance
with the terms of this Agreement as though all of such Certificates had been
issued at the date of the execution hereof.
(b) In case of any such consolidation, merger, transfer,
lease, purchase or conveyance such change in phraseology and form (but not in
substance) may be made in the Certificates evidencing Units thereafter to be
issued as may be appropriate.
SECTION 9.3. OPINION OF COUNSEL GIVEN TO AGENT.
The Agent, subject to Sections 7.1 and 7.3, shall receive an
Opinion of Counsel as conclusive evidence that any such consolidation, merger,
transfer, lease, purchase or conveyance, and any such assumption, complies with
the provisions of this Article and that all conditions precedent to the
consummation of any such consolidation, merger, sale, assignment, transfer,
lease, purchase or conveyance have been met.
ARTICLE X
COVENANTS
SECTION 10.1. PERFORMANCE UNDER PURCHASE CONTRACTS.
71
The Company covenants and agrees for the benefit of the
Holders from time to time of the Units that it will duly and punctually perform
its obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement. In the case of an Early Settlement, if
the United States federal securities law so require, the Company will use
commercially reasonable efforts to (i) have in effect a registration statement
covering the Ordinary Shares to be delivered in respect of the Purchase
Contracts being settled and (ii) provided a prospectus in connection therewith,
in each case that may be used in connection with such Early Settlement.
SECTION 10.2. MAINTENANCE OF OFFICE OR AGENCY. (a) The Company will
maintain in the Borough of Manhattan, The City of New York an office or agency
where Certificates may be presented or surrendered for payment of Contract
Adjustment Payments, acquisition of Ordinary Shares upon settlement of the
Purchase Contracts on any Settlement Date and for transfer of Collateral upon
occurrence of a Termination Event, where Certificates may be surrendered for
registration of transfer or exchange, for a Collateral Substitution or
reestablishment of Normal Units and where notices and demands to or upon the
Company in respect of the Units and this Agreement may be served. The Company
will give prompt written notice to the Agent of the location, and any change in
the location, of such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Agent
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the Corporate Trust Office, and the Company hereby
appoints the Agent as its agent to receive all such presentations, surrenders,
notices and demands.
(b) The Company may also from time to time designate one or
more other offices or agencies where Certificates may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided that no such designation or rescission shall in any
manner relieve the Company of its obligation to maintain an office or agency in
the Borough of Manhattan, The City of New York for such purposes. The Company
will give prompt written notice to the Agent of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby designates as the place of payment for the Units the
Corporate Trust Office and appoints the Agent at its Corporate Trust Office as
paying agent in such city.
SECTION 10.3. COMPANY TO RESERVE ORDINARY SHARES.
The Company shall at all times prior to the Stock Purchase
Date reserve and keep available, free from preemptive rights, out of its
authorized but unissued Ordinary Shares the maximum number of Ordinary Shares
issuable against tender of payment in respect of all Purchase Contracts
constituting a part of the Units evidenced by Outstanding Certificates.
SECTION 10.4. COVENANTS AS TO ORDINARY SHARES.
The Company covenants that all Ordinary Shares which may be
issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Units will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable. No shareholder
consents are required in respect of the issuance of the foregoing Ordinary
Shares.
72
SECTION 10.5. STATEMENTS OF OFFICER OF THE COMPANY AS TO DEFAULT.
The Company will deliver to the Agent, within 120 days after
the end of each fiscal year of the Company ending after the date hereof, an
Officers' Certificate, stating whether or not to the best knowledge of the
signers thereof the Company is in default in the performance and observance of
any of the terms, provisions and conditions hereof, and if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which such Officers may have knowledge. In the event the Company shall change
its fiscal year at any time the Units are outstanding, the Company shall notify
the Agent of the effective date of such change.
SECTION 10.6. LISTING. In the event that the Stripped Units or Notes
become separately traded from the Normal Units to the extent that applicable
exchange listing requirements are met, the Company covenants and agrees to use
commercially reasonable efforts to cause such Stripped Units or Notes, as the
case may be, to be listed on the securities exchange on which the Normal Units
are then listed.
SECTION 10.7. REGISTRATION STATEMENT
The Company agrees to use commercially reasonable efforts to ensure
that, if required by applicable law, a registration statement with regard to the
full amount of the Notes to be remarketed in the remarketing shall be effective
with the Securities and Exchange Commission in a form that will enable the
Remarketing Agent to rely on it in connection with such remarketing.
SECTION 10.8. SECURITIES CONTRACT.
Without limiting the applicability of Section 365 of the Bankruptcy
Code, it is the intention of the Company that this Agreement shall constitute a
"securities contract" for purposes of and subject to the provisions of Section
555 of the Bankruptcy Code. The Company agrees that (i) prior to an exercise by
the Collateral Agent on behalf of the Company of its rights as a secured party
pursuant to the Pledge Agreement, the Company does not have any ownership right,
title or interest in and to the Pledged Notes and (ii) the Holders of a Ordinary
Shares shall not be deemed to have purchased, and the Company shall not be
deemed to have sold any Ordinary Shares pursuant to a Purchase Contract related
to such Security prior to a Cash Settlement, an Early Settlement or the
occurrence of the Stock Purchase Date (provided that no prior occurrence of a
Termination Event with respect to such Ordinary Shares has occurred).
SECTION 10.9. ADDITIONAL AMOUNTS
All amounts payable (whether in respect of a Contract
Adjustment Payment, Deferred Contract Adjustment Payment or otherwise) in
respect of the Purchase Contracts and the Units will be made free and clear of
and without withholding or deduction for or on account of any present or future
taxes, duties, levies, assessments or governmental charges of whatever nature
imposed or levied by or on behalf of the Cayman Islands or Bermuda or any
political subdivision thereof or any authority or agency therein or thereof
having power to tax, unless the withholding or deduction of such taxes, duties,
levies, assessments or governmental charges is required by law. In that event,
the Company will pay, or cause to be paid, such additional amounts
73
as may be necessary in order that the net amounts receivable by a Holder after
such withholding or deduction (including any withholding or deduction on such
payment of additional amounts) shall equal the respective amounts that would
have been receivable by such Holder had no such withholding or deduction been
required ("Additional Amounts"), except that no such Additional Amounts shall be
payable in relation to any payment in respect of any of the Purchase Contracts
or Units (a) to, or to a third party on behalf of, a Person who would be able to
avoid such withholding or deduction but for a failure to satisfy any applicable
statutory certification, information or documentation requirements concerning
the nationality, residence or identity of such Person or to make a declaration
of non-residence or similar claim for exemption which, in either case, is
required as a precondition to exemption, or is liable for such taxes, duties,
levies, assessments or governmental charges in respect of such Purchase Contract
or Unit by reason of his having some connection with (including, without
limitation, being a citizen of, being incorporated or engaged in a trade or
business in, or having a residence or principal place of business or other
presence in) the Cayman Islands or Bermuda, as the case may be, other than (i)
the mere holding of such Purchase Contract or Unit or (ii) the receipt of
principal, interest, or other amount in respect of such Purchase Contract or
Unit; (b) presented for payment more than 30 days after the Relevant Date,
except to the extent that the relevant Holder would have been entitled to such
Additional Amounts on presenting the same for payment on or before the expiry of
such period of 30 days; (c) on account of any inheritance, gift, estate,
personal property, sales or transfer or similar taxes, duties, levies,
assessments or similar governmental charges; or (d) on account of any taxes,
duties, levies, assessments or governmental charges that are payable otherwise
than by withholding from payments in respect of such Purchase Contract or Unit.
If the Company becomes subject generally at any time to any
taxing jurisdiction other than or in addition to the Cayman Islands and Bermuda,
references in this section to the Cayman Islands and Bermuda shall be read and
construed as references to such other jurisdiction(s) and/or to the Cayman
Islands and Bermuda.
Any reference in this Agreement to Contract Adjustment
Amounts, Deferred Contract Adjustment Amounts or other amounts due from the
Company in respect of the Purchase Contracts or Units, any redemption amount and
any other amounts in the nature of principal, shall be deemed also to refer to
any Additional Amounts that may be payable under this Agreement, the Units or
the Purchase Contracts, and the express mention of the payment of Additional
Amounts (if applicable) in any provision hereof shall not be construed as
excluding Additional Amounts in those provisions hereof where such express
mention is not made.
Except as otherwise provided in or pursuant to this
Agreement, if the Purchase Contracts or Units require the
payment of Additional Amounts, at least 30 days prior to each date on which any
payments under or with respect to the Purchase Contracts or Units are due and
payable (unless such obligation to pay Additional Amounts arises shortly before
or after the 30th day prior to such date, in which case it shall be promptly
thereafter) the Company, or its designee shall furnish to the Agent an Officers'
Certificate stating the fact that Additional Amounts will be payable, the
amounts so payable, and any other information to enable the Trustee or such
Paying Agent to pay such Additional Amounts to Holders on the payment date.
74
The Company will pay any present or future stamp, court or
documentary taxes, or any other excise or property taxes, charges or similar
levies which arise in any jurisdiction from the execution, delivery or
registration of any Purchase Contracts or Units or any other document or
instrument referred to therein (other than a transfer of the Purchase Contracts
or Units), or the receipt of any payments with respect to the Purchase Contracts
or Units, excluding any such taxes, charges or similar levies imposed by any
jurisdiction outside the Cayman Islands or Bermuda in which a Paying Agent is
located, other than those resulting from, or required to be paid in connection
with, the enforcement of the Purchase Contracts or Units, this Agreement, the
Pledge Agreement or any other such document or instrument following the
occurrence of any event of default with respect to the Purchase Contracts or
Units.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
XL CAPITAL LTD
By:
-------------------------------------
Name:
-------------------------------
Title:
-------------------------------
U.S. BANK NATIONAL ASSOCIATION,
as Purchase Contract Agent
By:
-------------------------------------
Name:
-------------------------------
Title:
-------------------------------
EXHIBIT A
FORM OF NORMAL UNITS CERTIFICATE
(Form of Global Certificate Legend)
[THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE PURCHASE
CONTRACT AGREEMENT (AS DEFINED ON THE REVERSE HEREOF) AND IS REGISTERED IN THE
NAME OF THE CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE
EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER OF
THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.]*
[so long as DTC is the Depositary, insert: Unless this Certificate is presented
by an authorized representative of The Depository Trust Company (55 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx) to the Company or its agent for registration of
transfer, exchange or payment, and any Certificate issued is registered in the
name of Cede & Co., or such other name as requested by an authorized
representative of The Depository Trust Company, and any payment hereon is made
to Cede & Co. or to such other entity as is requested by an authorized
representative of The Depository Trust Company, ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the
registered owner hereof, Cede & Co., has an interest herein.]
[UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR CERTIFICATES IN
DEFINITIVE REGISTERED FORM IN THE LIMITED CIRCUMSTANCES REFERRED TO IN THE
PURCHASE CONTRACT AGREEMENT, THIS GLOBAL CERTIFICATE MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY
OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE
OF SUCH SUCCESSOR DEPOSITARY.]*
------------------------------
*To be inserted in Global Certificates only.
A-1
(FORM OF FACE OF NORMAL UNITS CERTIFICATE)
XL CAPITAL LTD
6.50% Equity Security Units
No. CUSIP No. X00000000
Number of Normal Units
This Normal Units Certificate certifies that _______________is the
registered Holder of the number of Normal Units set forth above [If the
Certificate is a Global Certificate, insert - , as such number may be increased
or decreased as set forth on the Schedule of Increases or Decreases in Global
Certificate annexed hereto]. Each Normal Unit represents (i) either (a) a 1/40,
or 2.5%, beneficial ownership interest of the Holder in one 2.53 % Senior Note
due 2009 (the "Note") of XL Capital Ltd, a Cayman Islands exempted limited
company (the "Company"), having a principal amount of $1,000, subject to the
Pledge of such Note by such Holder pursuant to the Pledge Agreement, or (b) if a
Special Event Redemption related to a Tax Event, the Treasury Consideration,
subject to the Pledge of such Treasury Consideration by such Holder pursuant to
the Pledge Agreement, and (ii) the rights and obligations of the Holder under
one Purchase Contract with the Company. Each Normal Unit will have a stated
amount of $25 (the "Stated Amount"). All capitalized terms used herein which are
defined in the Purchase Contract Agreement have the meaning set forth therein.
Pursuant to the Pledge Agreement, the interest in the Note or the
Treasury Consideration, as the case may be, constituting part of each Normal
Unit evidenced hereby has been pledged to the Collateral Agent, for the benefit
of the Company, to secure the obligations of the Holder under the Purchase
Contract comprising a part of such Normal Unit to purchase Ordinary Shares of
the Company. Prior to the purchase of Ordinary Shares under each Purchase
Contract, such Purchase Contracts shall not entitle the Holders of Normal Units
Certificates to any of the rights of a holder of Ordinary Shares, including
without limitation, the right to vote or receive any dividends or other payments
or to consent or to receive notice as shareholders in respect of the meetings of
shareholders, or for the election of directors of the Company or for any other
matter or any other rights whatsoever as shareholder of the Company.
The Pledge Agreement provides that all payments in respect of the
Pledged Notes or Pledged Treasury Consideration received by the Collateral Agent
shall be paid by the Collateral Agent by wire transfer in same day funds (i) in
the case of (A) any interest payments on Normal Units which include Pledged
Notes or Pledged Treasury Consideration, as the case may be, and (B) any
payments in respect of the Notes or Treasury Consideration, as the case may be,
that have been released from the Pledge pursuant to the Pledge Agreement, to the
Agent to the account designated by the Agent, no later than 11:00 a.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 10:30 a.m., New York City time, on a
Business Day, then such payment shall be made no later than 9:30 a.m., New York
City time, on the next succeeding Business Day) and (ii) in the case of payments
in respect of any Pledged Notes or Pledged Treasury Consideration, as the case
may be, to be paid
A-2
upon settlement of such Holder's obligations to purchase Ordinary Shares under
the Purchase Contract, to the Company on the Stock Purchase Date (as defined
herein) in accordance with the terms of the Pledge Agreement, in full
satisfaction of the respective obligations of the Holders of the Normal Units of
which such Pledged Notes or Pledged Treasury Consideration are a part under the
Purchase Contracts forming a part of such Normal Units. Interest payments
payable on each Payment Date (as defined below) with respect to Pledged Notes or
the appropriate Pledged Treasury Consideration included in the Normal Units
shall be made quarterly in arrears on such Payment Date, subject to receipt
thereof by the Agent from the Trustee or Collateral Agent, as the case may be,
to the Person in whose name this Normal Units Certificate (or a Predecessor
Normal Units Certificate) is registered at the close of business on the Record
Date for such Payment Date.
Each Purchase Contract evidenced hereby obligates the Holder of this
Normal Units Certificate to purchase, and the Company to sell, on May 15, 2007
(the "Stock Purchase Date"), at a price equal to $25 (the "Purchase Price"), a
number of Class A Ordinary Shares, par value $0.01 per share ("Ordinary
Shares"), of the Company, equal to the Settlement Rate or, if the Company has
fixed the Settlement Rate pursuant to Section 5.1(f) of the Purchase Contract
Agreement, the Fixed Settlement Rate, unless on or prior to the Stock Purchase
Date there shall have occurred a Termination Event or an Early Settlement or
Merger Early Settlement with respect to the Normal Units of which such Purchase
Contract is a part, all as provided in the Purchase Contract Agreement, as
defined and more fully described on the reverse hereof. The Purchase Price for
the Ordinary Shares purchased pursuant to each Purchase Contract evidenced
hereby, if not paid earlier, shall be satisfied on the Stock Purchase Date by
either (i) the application of payments received with regard to Pledged Treasury
Consideration, or (ii) the exercise of the Company's rights as a secured party
in connection with the Pledged Notes, as the case may be.
The Company shall pay on each February 15, May 15, August 15 and
November 15 each year, commencing May 15, 2004 (each a "Payment Date") in
respect of each Purchase Contract forming part of a Normal Unit evidenced hereby
an amount (the "Contract Adjustment Payments") equal to 3.97% per year of the
Stated Amount, computed on the basis of a 360-day year of twelve 30-day months,
subject to deferral at the option of the Company as provided in the Purchase
Contract Agreement and more fully described on the reverse hereof (provided that
if on any date on which Contract Adjustment Payments are to be made on the
Purchase Contracts is not a Business Day, then payment of the Contract
Adjustment Payments payable on that date will be made on the next succeeding day
which is a Business Day, and no interest or payment will be paid in respect of
the delay, except that if such next succeeding Business Day is in the next
succeeding calendar year, such payment will be made on the immediately preceding
Business Day). Such Contract Adjustment Payments shall be payable to the Person
in whose name this Normal Units Certificate (or a Predecessor Normal Units
Certificate) is registered at the close of business on the Record Date for such
Payment Date.
Contract Adjustment Payments and payments on the Notes or the Treasury
Consideration will be payable at the office of the Agent in The City of New York
or, at the option of the Company, by check mailed to the address of the Person
entitled thereto as such address appears on the Normal Units Register or by wire
transfer to the account designated by such Person in writing.
A-3
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Normal Units Certificate shall not be
entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
Dated: XL CAPITAL LTD
------------------ By:
---------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the Purchase
Contracts evidenced hereby)
By: U.S. BANK NATIONAL ASSOCIATION,
not individually but solely as
Attorney-in-Fact of such Holder
By:
---------------------------------------
Name:
Title:
A-4
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Normal Units Certificates referred to in the within
mentioned Purchase Contract Agreement.
U.S. Bank National Association, as Purchase
Contract Agent
Dated: By:
--------------------- ----------------------------------------
Authorized Officer
A-5
(Form of Reverse of Normal Units Certificate)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of March 23, 2004 (as may be supplemented from time
to time, the "Purchase Contract Agreement"), between the Company and U.S. Bank
National Association, as Purchase Contract Agent (including its successors
thereunder, herein called the "Agent"), to which Purchase Contract Agreement and
supplemental agreements thereto reference is hereby made for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Agent, the Company, and the Holders and of the terms upon
which the Normal Units Certificates are, and are to be, executed and delivered.
All defined terms used but not defined in this Certificate have the meanings
ascribed to them in the Purchase Contract Agreement.
Each Purchase Contract evidenced hereby obligates the Holder of this
Normal Units Certificate to purchase, and the Company to sell, on the Stock
Purchase Date at a price equal to $25 (the "Purchase Price"), a number of
Ordinary Shares of the Company equal to the Settlement Rate or, if the Company
has fixed the Settlement Rate pursuant to Section 5.1(f) of the Purchase
Contract Agreement, the Fixed Settlement Rate, unless, on or prior to the Stock
Purchase Date, there shall have occurred a Termination Event or a Cash
Settlement, Early Settlement or Merger Early Settlement with respect to the Unit
of which such Purchase Contract is a part. The "Settlement Rate" is equal to (a)
if the Applicable Market Value (as defined below) is equal to or greater than
$93.99 (the "Threshold Appreciation Price"), 0.2660 Ordinary Shares per Purchase
Contract, (b) if the Applicable Market Value is less than the Threshold
Appreciation Price but is greater than $75.19, the number of Ordinary Shares per
Purchase Contract equal to the Purchase Price divided by the Applicable Market
Value and (c) if the Applicable Market Value is equal to or less than $75.19,
0.3325 Ordinary Shares per Purchase Contract, in each case subject to adjustment
as provided in the Purchase Contract Agreement. No fractional Ordinary Shares
will be issued upon settlement of Purchase Contracts, as provided in the
Purchase Contract Agreement.
The "Applicable Market Value" means the average of the Closing Price
per Ordinary Share on each of the 20 consecutive Trading Days ending on the
third Trading Day immediately preceding the Stock Purchase Date or, in the event
of a Cash Merger, the Cash Merger Date.
The "Closing Price" of the Ordinary Shares on any date of determination
means the closing sale price (or, if no closing sale price is reported, the last
reported sale price) of the Ordinary Shares on the New York Stock Exchange (the
"NYSE") on such date or, if the Ordinary Shares are not listed for trading on
the NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Ordinary Shares are so
listed, or if the Ordinary Shares are not so listed on a United States national
or regional securities exchange, as reported by The Nasdaq Stock Market, or, if
the Ordinary Shares are not so reported, the last quoted bid price for the
Ordinary Shares in the over-the-counter market as reported by the National
Quotation Bureau or similar organization, or, if such bid price is not
available, the market value of the Ordinary Shares on such date as determined by
a nationally recognized independent investment banking firm retained for this
purpose by the Company.
A-6
A "Trading Day" means a day on which the Ordinary Shares (A) are not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) have
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Ordinary Shares at the close of business on such day.
Each Purchase Contract evidenced hereby may be settled prior to the
Stock Purchase Date through Cash Settlement, Early Settlement or Merger Early
Settlement, in accordance with the terms of the Purchase Contract Agreement.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Normal Units Certificate shall pay the Purchase Price for the
Ordinary Shares purchased pursuant to each Purchase Contract evidenced hereby
(i) by effecting a Cash Settlement, an Early Settlement or Merger Early
Settlement; (ii) if the Holder has elected not to participate in the
remarketing, by application of the cash payment delivered in respect thereof
deposited by such Holder in respect of such Purchase Contract or (iii) if a
Special Event Redemption has occurred prior to the successful remarketing of the
Notes as contemplated by Section 5.4 of the Purchase Contract Agreement, by
application of payments received in respect of the Pledged Treasury
Consideration purchased by the Collateral Agent on behalf of the Holder of this
Normal Units Certificate. The Company shall not be obligated to issue any
Ordinary Shares in respect of a Purchase Contract or deliver any certificates
therefor to the Holder unless it shall have received payment in full of the
aggregate Purchase Price for the Ordinary Shares to be purchased thereunder or
become entitled to exercise its rights as a secured party in the manner set
forth in the Purchase Contract Agreement. If, as provided in the Purchase
Contract Agreement, upon the occurrence of a Last Failed Remarketing the
Collateral Agent, for the benefit of the Company, exercises its rights as a
secured creditor with respect to the Pledged Notes related to this Normal Units
Certificate, any accrued and unpaid interest on such Pledged Notes will become
payable by the Company to the Holder of this Normal Units Certificate in the
manner provided for in the Purchase Contract Agreement.
The Agent will be entitled to exercise the voting and any other
consensual rights pertaining to the Pledged Notes, but only to the extent
instructed by the Holders as described below. Upon receipt of notice of any
meeting at which holders of Notes are entitled to vote or upon the solicitation
of consents, waivers or proxies of holders of Notes, the Agent shall, as soon as
practicable thereafter, mail to the Holders of Normal Units a notice (a)
containing such information as is contained in the notice or solicitation, (b)
stating that each such Holder on the record date set by the Agent therefor
(which, to the extent possible, shall be the same date as the record date for
determining the holders of Notes entitled to vote) shall be entitled to instruct
the Agent as to the exercise of the voting rights pertaining to the Pledged
Notes constituting a part of such Holder's Normal Units and (c) stating the
manner in which such instructions may be given. Upon the written request of any
Holder of Normal Units on such record date, the Agent shall endeavor insofar as
practicable to vote or cause to be voted, in accordance with the instructions
set forth in such request the maximum number of Pledged Notes as to which any
particular voting instructions are received. In the absence of specific
instructions from the Holder of a Normal Unit, the Agent shall abstain from
voting the Pledged Note evidenced by such Normal Unit.
A-7
The Normal Units Certificates are issuable only in registered form and
only in denominations of a single Normal Unit and any integral multiple thereof.
The transfer of any Normal Units Certificate will be registered and Normal Units
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The Normal Units Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents permitted by the Purchase
Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange of a Normal Units Certificate, but the
Company and the Agent may require payment of a sum sufficient to cover any tax
or other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Certificates, other than exchanges not
involving any transfer as provided for in the Purchase Contract Agreement. The
Holder of a Normal Unit may substitute for the Pledged Notes or Pledged Treasury
Consideration securing its obligations under the related Purchase Contract
Treasury Securities in accordance with the terms of the Purchase Contract
Agreement and the Pledge Agreement. From and after such Collateral Substitution,
the Unit for which such Pledged Treasury Securities secures the Holder's
obligation under the Purchase Contract shall be referred to as a "Stripped
Unit." A Holder that elects to substitute Treasury Securities for Pledged Notes
or Pledged Treasury Consideration, thereby creating Stripped Units, shall be
responsible for any fees or expenses payable in connection therewith. Except as
provided in the Purchase Contract Agreement, for so long as the Purchase
Contract underlying a Normal Unit remains in effect, such Normal Unit shall not
be separable into its constituent parts, and the rights and obligations of the
Holder of such Normal Units in respect of the Pledged Note or Pledged Treasury
Consideration and Purchase Contract comprising such Normal Unit may be acquired,
and may be transferred and exchanged, only as a Normal Unit.
A Holder of Stripped Units may reestablish Normal Units at any time
from and after the date of the Purchase Contract Agreement and on or prior to
the thirteenth Business Day immediately preceding the Stock Purchase Date by
depositing with the Collateral Agent the Notes or the Treasury Consideration in
exchange for the release of the Pledged Treasury Securities in accordance with
the terms of the Purchase Contract Agreement and the Pledge Agreement.
Subject to the next succeeding paragraph, the Company shall pay, on
each Payment Date, the Contract Adjustment Payments, if any, payable in respect
of each Purchase Contract to the Person in whose name the Normal Units
Certificate (or one or more Predecessor Normal Units Certificates) evidencing
such Purchase Contract is registered on the Normal Units Register at the close
of business on the Record Date next preceding such Payment Date. The Contract
Adjustment Payments, if any, will be payable at the office of the Agent in The
City of New York or, at the option of the Company, by check mailed to the
address of the Person entitled thereto as such address appears on the Normal
Units Register or by wire transfer to the account designated by such Person in
writing.
The Company shall have the right, at any time prior to the Stock
Purchase Date, to defer the payment of any or all of the Contract Adjustment
Payments otherwise payable on any Payment Date, but only if the Company shall
give the Holders and the Agent written notice of its election to defer each such
Contract Adjustment Payments as provided in the Purchase Contract Agreement. Any
Contract Adjustment Payments so deferred shall, to the extent permitted by law,
accrue additional Contract Adjustment Payments thereon at the rate of 6.50% per
year (computed
A-8
on the basis of a 360-day year of twelve 30-day months), compounding on each
succeeding Payment Date, until paid in full (such deferred installments of
Contract Adjustment Payments, if any, together with the additional Contract
Adjustment Payments, if any, accrued thereon, are referred to herein as the
"Deferred Contract Adjustment Payments"). Deferred Contract Adjustment Payments,
if any, shall be due on the next succeeding Payment Date except to the extent
that payment is deferred pursuant to the Purchase Contract Agreement. No
Contract Adjustment Payments may be deferred to a date that is after the Stock
Purchase Date and no such deferral period may end other than on a Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until a Payment Date prior to the
Stock Purchase Date, then all Deferred Contract Adjustment Payments, if any,
shall be payable to the registered Holders as of the close of business on the
Record Date immediately preceding such Payment Date.
The Company's obligations with respect to Contract Adjustment Payments
(including any accrued or Deferred Contract Adjustment Payments) will be
subordinated and junior in right of payment to the Company's obligations under
any Senior Indebtedness in the manner and to the extent set forth in the
Purchase Contract Agreement.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until the Stock Purchase Date, the
Holder of this Normal Units Certificate will receive on the Stock Purchase Date,
in lieu of a cash payment, a number of Ordinary Shares (in addition to the
number of Ordinary Shares equal to the Settlement Rate) equal to (i) the
aggregate amount of Deferred Contract Adjustment Payments payable to the Holder
of this Normal Units Certificate divided by (ii) the Applicable Market Value.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, then, until the earlier of (x) the Termination
Date and (y) the date on which the Deferred Contract Adjustment Payments have
been paid, the Company shall not, and will not permit any subsidiary of the
Company to, declare or pay dividends on, make distributions with respect to, or
redeem, purchase or acquire, or make a liquidation payment with respect to, any
of the Company's Capital Stock other than (i) repurchases, redemptions or
acquisitions of Ordinary Shares of the Company in connection with any employment
contract, benefit plan or other similar arrangement with or for the benefit of
employees, officers, directors or agents or a stock purchase or dividend
reinvestment plan, or the satisfaction by the Company of its obligations
pursuant to any contract or security outstanding on the date the Company
exercises its rights to defer the Contract Adjustment Payments; (ii) as a result
of a reclassification of the Company's Capital Stock or the exchange or
conversion of one class or series of the Company's Capital Stock for another
class or series of the Company's Capital Stock; (iii) the purchase of fractional
interests in shares of any series of the Company's Capital Stock pursuant to the
conversion or exchange provisions of such Capital Stock or the security being
converted or exchanged; (iv) dividends or distributions in any series of the
Company's Capital Stock (or rights to acquire the Company's Capital Stock) or
repurchases, redemptions or acquisitions of the Company's Capital Stock in
exchange for or out of the net cash proceeds of the sale of the Company's
Capital Stock (or securities convertible into or exchangeable for shares of the
Company's Capital Stock); or (v) redemptions, exchanges or repurchases of any
rights outstanding under a shareholder rights plan on the date the Company
exercises its right to
A-9
defer the payment of Contract Adjustment Payments or the declaration or payment
thereunder of a dividend or distribution of or with respect to rights in the
future, or the redemption or repurchase of any rights pursuant thereto.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive accumulated Contract Adjustment Payments, if any, or any
Deferred Contract Adjustment Payments and the obligations of the Holders to
purchase Ordinary Shares, shall immediately and automatically terminate, without
the necessity of any notice or action by any Holder, the Agent or the Company,
if, on or prior to the Stock Purchase Date, a Termination Event shall have
occurred. Upon the occurrence of a Termination Event, the Company shall promptly
but in no event later than two Business Days thereafter give written notice to
the Agent, the Collateral Agent and to the Holders, at their addresses as they
appear in the Normal Units Register. Upon and after the occurrence of a
Termination Event, the Collateral Agent shall release the Pledged Notes or
Pledged Treasury Consideration from the Pledge in accordance with the provisions
of the Pledge Agreement.
Upon registration of transfer of this Normal Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract
Agreement, the Purchase Contracts evidenced hereby and the Pledge Agreement and
the transferor shall be released from the obligations under the Purchase
Contract Agreement, the Purchase Contracts evidenced by this Normal Units
Certificate and the Pledge Agreement. The Company covenants and agrees, and the
Holder, by its acceptance hereof, likewise covenants and agrees, to be bound by
the provisions of this paragraph.
The Holder of this Normal Units Certificate, by its acceptance hereof,
irrevocably authorizes the Agent to enter into and perform the related Purchase
Contracts forming part of the Normal Units evidenced hereby on his behalf as his
attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Purchase Contracts by the Company, any receiver, liquidator
or person or entity performing similar functions or its trustee in the event
that the Company becomes the debtor under the Bankruptcy Code or subject to
other similar state or federal or other law, agrees to be bound by the terms and
provisions thereof, covenants and agrees to perform such Holder's obligations
under such Purchase Contracts, consents to the provisions of the Purchase
Contract Agreement, irrevocably authorizes the Agent to enter into and perform
the Pledge Agreement on such Holder's behalf as attorney-in-fact, and consents
to the Pledge of the Notes or the Treasury Consideration underlying this Normal
Units Certificate pursuant to the Pledge Agreement, provided, that, upon a
Termination Event, the rights of the Holder of such Notes may be enforced
without regard to any other rights or obligations. The Holder further covenants
and agrees, that, to the extent and in the manner provided in the Purchase
Contract Agreement and the Pledge Agreement, but subject to the terms thereof,
payments in respect of the Pledged Notes or the Pledged Treasury Consideration
to be paid upon settlement of such Holder's obligations to purchase Ordinary
Shares under the Purchase Contract, shall be paid on the Stock Purchase Date by
the Collateral Agent to the Company in satisfaction of such Holder's obligations
under such Purchase Contract and such Holder shall acquire no right, title or
interest in such payments. The obligations of each Holder to pay the Purchase
Price are non-recourse obligations and except to the extent paid by Cash
Settlement,
A-10
Early Settlement or Merger Early Settlement, are payable solely out of the
proceeds of any Collateral pledged to secure the obligations of the Holders and
in no event will Holders be liable for any deficiency between such payments and
the Purchase Price. Notwithstanding anything to the contrary herein, the Company
shall not be obligated to issue any Ordinary Shares in respect of a Purchase
Contract or deliver any certificates therefor to the Holder of the related Unit
unless the Company shall have (i) received payment in full of the aggregate
Purchase Price for the Ordinary Shares to be purchased thereunder by such Holder
in the manner herein set forth or (ii) exercised its rights as a secured party
under Section 5.4(b)(iii) of the Purchase Contract Agreement.
The Company and each Holder of a Normal Unit or a Stripped Unit, by its
acceptance thereof, covenants and agrees (a) to treat a Holder's acquisition of
the Normal Unit as the acquisition of the Note and Purchase Contract
constituting the Normal Unit, (b) to treat a Holder's acquisition of a Stripped
Unit as the acquisition of a Treasury Security and Purchase Contract
constituting the Stripped Unit, (c) to treat each Holder as the owner, for
federal, state and local income and franchise tax purposes of (i) the related
Notes or the Treasury Consideration, in the case of the Normal Units, or (ii)
the Treasury Securities, in the case of the Stripped Units, (d) to treat the
Notes as indebtedness of the Company for federal, state and local income and
franchise tax purposes and (e) to allocate 100% of the issue price of a Normal
Unit to the beneficial interest in the Note and 0.00% of the issue price to the
Purchase Contract.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
outstanding Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by, deemed to
be a contract under, and construed in accordance with, the laws of the State of
New York.
The Company, the Agent and its Affiliates and any agent of the Company
or the Agent may treat the Person in whose name this Normal Units Certificate is
registered as the owner of the Normal Units evidenced hereby for the purpose of
receiving quarterly payments of interest on the Notes or the Treasury
Consideration, as the case may be, receiving payments of Contract Adjustment
Payments, if any, and any Deferred Contract Adjustment Payments, performance of
the Purchase Contracts and for all other purposes whatsoever, whether or not any
payments in respect thereof be overdue and notwithstanding any notice to the
contrary, and neither the Company, the Agent, such Affiliates nor any such agent
shall be affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of Ordinary Shares.
A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Agent.
A-11
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - Custodian
--------------------------------------------
(cust) (minor)
Under Uniform Gifts to Minors Act
--------------------------------------------
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship
and not as tenants in common
Additional abbreviations may also be used though not in the above list.
A-12
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
--------------------------------------------------------------------------------
(Please insert Social Security or Taxpayer I.D. or other Identifying
Number of Assignee)
--------------------------------------------------------------------------------
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Normal Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing ______________attorney to transfer said
Normal Units Certificates on the books of XL Capital Ltd with full power of
substitution in the premises.
Dated: Signature:
---------- -----------------------------
NOTICE: The signature to this assignment
must correspond with the name as it
appears upon the face of the within
Normal Units Certificates in every
particular, without alteration or
enlargement or any change whatsoever.
Signature Guarantee:
------------------------------------------------------------
A-13
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for Ordinary Shares
deliverable upon settlement on or after the Stock Purchase Date of the Purchase
Contracts underlying the number of Normal Units evidenced by this Normal Units
Certificate be registered in the name of, and delivered, together with a check
in payment for any fractional share, to the undersigned at the address indicated
below unless a different name and address have been indicated below. If shares
are to be registered in the name of a Person other than the undersigned, the
undersigned will pay any transfer tax payable incident thereto.
Dated: Signature:
---------- -----------------------------
Signature Guarantee:
-------------------
(if assigned to another person)
If shares are to be registered in the
name of and delivered to a Person other REGISTERED HOLDER
than the Holder, please (i) print such
Person's name and address and (ii) Please print name
provide a guarantee of your signature: and address of Registered Holder:
------------------------------------- ---------------------------------------
Name Name
------------------------------------- ---------------------------------------
Address Address
Social Security or other Taxpayer
Identification Number, if any:
A-14
ELECTION TO SETTLE EARLY
The undersigned Holder of this Normal Units Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Normal Units evidenced by this Normal Units
Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Normal Units with
an aggregate Purchase Price equal to $1,000 or an integral multiple thereof. The
undersigned Holder directs that a certificate for Ordinary Shares deliverable
upon such Early Settlement be registered in the name of, and delivered, together
with a check in payment for any fractional share and any Normal Units
Certificate representing any Normal Units evidenced hereby as to which Early
Settlement of the related Purchase Contracts is not effected, to the undersigned
at the address indicated below unless a different name and address have been
indicated below. Pledged Notes or Pledged Treasury Consideration deliverable
upon such Early Settlement will be transferred in accordance with the transfer
instructions set forth below. If Ordinary Shares are to be registered in the
name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.
Dated: Signature:
----------- -----------------------------
Signature Guarantee:
-------------------------------------
Number of Units evidenced hereby as to which Early Settlement
of the related Purchase Contracts is being elected:
If Ordinary Shares are to be registered
in the name of and delivered to and REGISTERED HOLDER
Pledged Notes or Pledged Treasury
Consideration are to be transferred to a
Person other than the Holder, please Please print name
print such Person's name and address: and address of Registered Holder:
------------------------------------- ---------------------------------------
Name Name
------------------------------------- ---------------------------------------
Address Address
Social Security or other Taxpayer
Identification Number, if any:
---------------------------------------
A-15
Transfer instructions for Pledged Notes or Pledged Treasury Consideration
transferable upon Early Settlement or a Termination Event:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
A-16
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have
been made:
STATED AMOUNT OF
THE GLOBAL
AMOUNT OF AMOUNT OF CERTIFICATE
DECREASE IN STATED INCREASE IN STATED FOLLOWING SUCH SIGNATURE OF
AMOUNT OF THE AMOUNT OF THE DECREASE OF AUTHORIZED OFFICER
DATE GLOBAL CERTIFICATE GLOBAL CERTIFICATE INCREASE OF AGENT
---- ------------------ ------------------ -------- -------------------
A-17
EXHIBIT B
FORM OF STRIPPED UNITS CERTIFICATE
(Form of Global Certificate Legend)
[THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT (AS DEFINED ON THE REVERSE HEREOF) AND IS REGISTERED
IN THE NAME OF A CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT
BE EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER
OF THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.]
[so long as DTC is the Depositary, insert: Unless this Certificate is
presented by an authorized representative of The Depository Trust Company (55
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) to the Company or its agent for registration
of transfer, exchange or payment, and any Certificate issued is registered in
the name of Cede & Co., or such other name as requested by an authorized
representative of The Depository Trust Company, and any payment hereon is made
to Cede & Co. or to such other entity as is requested by an authorized
representative of The Depository Trust Company, ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the
registered owner hereof, Cede & Co., has an interest herein.]
[UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR CERTIFICATES
IN DEFINITIVE REGISTERED FORM IN THE LIMITED CIRCUMSTANCES REFERRED TO IN THE
PURCHASE CONTRACT AGREEMENT, THIS GLOBAL CERTIFICATE MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY
OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE
OF SUCH SUCCESSOR DEPOSITARY.]*
-----------------------
* To be inserted in Global Certificates only.
B-1
(Form of Face of Stripped Units Certificate)
XL Capital Ltd
6.50% Equity Security Units
No. CUSIP No. X00000000
Number of Stripped Units
This Stripped Units Certificate certifies that ________________________
is the registered Holder of the number of Stripped Units set forth above [If the
Certificate is a Global Certificate, insert - , as such number may be increased
or decreased as set forth on the Schedule of Increases or Decreases in Global
Certificate annexed hereto]. Each Stripped Unit represents (i) a 1/40 undivided
beneficial ownership interest in a Treasury Security, subject to the Pledge of
such interest in such Treasury Security by such Holder pursuant to the Pledge
Agreement, and (ii) the rights and obligations of the Holder under one Purchase
Contract with XL Capital Ltd, a Cayman Islands exempted limited company (the
"Company"). Each Stripped Unit will have a stated amount of $25 (the "Stated
Amount"). All capitalized terms used herein which are defined in the Purchase
Contract Agreement have the meaning set forth therein.
Pursuant to the Pledge Agreement, the Treasury Security constituting
part of each Stripped Unit evidenced hereby has been pledged to the Collateral
Agent, for the benefit of the Company, to secure the obligations of the Holder
under the Purchase Contract comprising a part of such Stripped Unit to purchase
Ordinary Shares of the Company. Prior to the purchase of Ordinary Shares under
each Purchase Contract, such Purchase Contracts shall not entitle the Holders of
Normal Units Certificates to any of the rights of a holder of Ordinary Shares,
including without limitation, the right to vote or receive any dividends or
other payments or to consent or to receive notice as shareholders in respect of
the meetings of shareholders, or for the election of directors of the Company or
for any other matter or any other rights whatsoever as shareholder of the
Company.
Each Purchase Contract evidenced hereby obligates the Holder of this
Stripped Units Certificate to purchase, and the Company to sell, on May 15, 2007
(the "Stock Purchase Date"), at a price equal to $25 (the "Purchase Price"), a
number of Class A Ordinary Shares, par value $0.01 per share ("Ordinary
Shares"), of the Company, equal to the Settlement Rate or, if the Company has
fixed the Settlement Rate pursuant to Section 5.1(f) of the Purchase Contract
Agreement, the Fixed Settlement Rate, unless on or prior to the Stock Purchase
Date there shall have occurred a Termination Event or an Early Settlement or
Merger Early Settlement with respect to the Stripped Units of which such
Purchase Contract is a part, all as provided in the Purchase Contract Agreement
and more fully described on the reverse hereof. The Purchase Price (as defined
herein) for the Ordinary Shares purchased pursuant to each Purchase Contract
evidenced hereby, if not paid earlier, shall be paid on the Stock Purchase Date
by application of payments received in respect of the Pledged Treasury
Securities pledged to secure the obligations of the Holder under such Purchase
Contract in accordance with the terms of the Pledge Agreement.
B-2
The Company shall pay on each Payment Date in respect of each Purchase
Contract forming part of a Stripped Unit evidenced hereby an amount (the
"Contract Adjustment Payments") equal to 3.97% per year of the Stated Amount,
computed on the basis of a 360-day year of twelve 30-day months, subject to
deferral at the option of the Company as provided in the Purchase Contract
Agreement and more fully described on the reverse hereof (provided that if on
any date on which Contract Adjustment Payments are to be made on the Purchase
Contracts is not a Business Day, then payment of the Contract Adjustment
Payments payable on that date will be made on the next succeeding day which is a
Business Day, and no interest or payment will be paid in respect of the delay,
except that if such next succeeding Business Day is in the next succeeding
calendar year, such payment will be made on the immediately preceding Business
Day). Such Contract Adjustment Payments shall be payable to the Person in whose
name this Stripped Units Certificate (or a Predecessor Stripped Units
Certificate) is registered at the close of business on the Record Date for such
Payment Date.
Contract Adjustment Payments will be payable at the office of the Agent
in the City of New York or, at the option of the Company, by check mailed to the
address of the Person entitled thereto as such address appears on the Stripped
Units Register or by wire transfer to the account designated by such Person in
writing.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Stripped Units Certificate shall not be
entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.
B-3
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
Dated:
------------------
XL CAPITAL LTD
By:
-----------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the Purchase Contracts
evidenced hereby)
By: U.S. BANK NATIONAL ASSOCIATION, not
individually but solely as Attorney-in-Fact
of such Holder
By:
-----------------------------------------
Name:
Title:
B-4
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Stripped Units Certificates referred to in the
within-mentioned Purchase Contract Agreement.
Dated:
------------------
U.S. Bank National Association,
as Purchase Contract Agent
By:
----------------------------------
Authorized Officer
B-5
(Form of Reverse of Stripped Units Certificate)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of March 23, 2004 (as may be supplemented from time
to time, the "Purchase Contract Agreement"), between the Company and U.S. Bank
National Association, as Purchase Contract Agent (including its successors
thereunder, herein called the "Agent"), to which the Purchase Contract Agreement
and supplemental agreements thereto reference is hereby made for a description
of the respective rights, limitations of rights, obligations, duties and
immunities thereunder of the Agent, the Company and the Holders and of the terms
upon which the Stripped Units Certificates are, and are to be, executed and
delivered. All defined terms used but not defined in this Certificate have the
meanings ascribed to them in the Purchase Contract Agreement.
Each Purchase Contract evidenced hereby obligates the Holder of this
Stripped Units Certificate to purchase, and the Company to sell, on the Stock
Purchase Date at a price equal to $25 (the "Purchase Price"), a number of
Ordinary Shares of the Company equal to the Settlement Rate or, if the Company
has fixed the Settlement Rate pursuant to Section 5.1(f) of the Purchase
Contract Agreement, the Fixed Settlement Rate, unless, on or prior to the Stock
Purchase Date, there shall have occurred a Termination Event or a Cash
Settlement, an Early Settlement or Merger Early Settlement with respect to the
Unit of which such Purchase Contract is a part. The "Settlement Rate" is equal
to (a) if the Applicable Market Value (as defined below) is equal to or greater
than $93.99 (the "Threshold Appreciation Price"), 0.2660 Ordinary Shares per
Purchase Contract, (b) if the Applicable Market Value is less than the Threshold
Appreciation Price but is greater than $75.19, the number of Ordinary Shares per
Purchase Contract equal to the Purchase Price divided by the Applicable Market
Value and (c) if the Applicable Market Value is equal to or less than $75.19,
0.3325 Ordinary Shares per Purchase Contract, in each case subject to adjustment
as provided in the Purchase Contract Agreement. No fractional Ordinary Shares
will be issued upon settlement of Purchase Contracts, as provided in the
Purchase Contract Agreement.
The "Applicable Market Value" means the average of the Closing Price
per Ordinary Share on each of the 20 consecutive Trading Days ending on the
third Trading Day immediately preceding the Stock Purchase Date or in the event
of a Cash Merger, the Cash Merger Date.
The "Closing Price" of the Ordinary Shares on any date of determination
means the closing sale price (or, if no closing sale price is reported, the last
reported sale price) of the Ordinary Shares on the New York Stock Exchange (the
"NYSE") on such date or, if the Ordinary Shares are not listed for trading on
the NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Ordinary Shares are so
listed, or if the Ordinary Shares are not so listed on a United States national
or regional securities exchange, as reported by The Nasdaq Stock Market, or, if
the Ordinary Shares are not so reported, the last quoted bid price for the
Ordinary Shares in the over-the-counter market as reported by the National
Quotation Bureau or similar organization, or, if such bid price is not
available, the market value of the Ordinary Shares on such date as determined by
a nationally recognized independent investment banking firm retained for this
purpose by the Company.
B-6
A "Trading Day" means a day on which the Ordinary Shares (A) are not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) have
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Ordinary Shares at the close of business of such day.
Each Purchase Contract evidenced hereby may be settled prior to the
Stock Purchase Date through Cash Settlement, Early Settlement or Merger Early
Settlement, in accordance with the terms of the Purchase Contract Agreement.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Stripped Units Certificate shall pay the Purchase Price for the
Ordinary Shares purchased pursuant to each Purchase Contract evidenced hereby
(i) by effecting a Cash Settlement, an Early Settlement or Merger Early
Settlement or (ii) by application of payments received in respect of the Pledged
Treasury Securities underlying the Stripped Units represented by this Stripped
Units Certificate.
The Company shall not be obligated to issue any Ordinary Shares in
respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment in full of the aggregate Purchase
Price for the Ordinary Shares to be purchased thereunder in the manner herein
set forth.
The Stripped Units Certificates are issuable only in registered form
and only in denominations of a single Stripped Unit and any integral multiple
thereof. The transfer of any Stripped Units Certificate will be registered and
Stripped Units Certificates may be exchanged as provided in the Purchase
Contract Agreement. The Stripped Units Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents
permitted by the Purchase Contract Agreement. No service charge shall be
required for any such registration of transfer or exchange of a Stripped Units
Certificate, but the Company and the Agent may require payment from the Holder
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any registration of transfer or exchange of
Certificates, other than exchanges not involving any transfer as provided for in
the Purchase Contract Agreement. The Holder of a Stripped Unit may substitute
for the Pledged Treasury Securities securing its obligations under the related
Purchase Contract Notes or the Treasury Consideration in accordance with the
terms of the Purchase Contract Agreement and the Pledge Agreement. From and
after such Collateral Substitution, the Unit for which such Pledged Notes or
Pledged Treasury Consideration secures the Holder's obligation under the
Purchase Contract shall be referred to as a "Normal Unit." A Holder that elects
to substitute Notes or the Treasury Consideration for Pledged Treasury
Securities, thereby reestablishing Normal Units, shall be responsible for any
fees or expenses payable in connection therewith. Except as provided in the
Purchase Contract Agreement, for so long as the Purchase Contract underlying a
Stripped Unit remains in effect, such Stripped Unit shall not be separable into
its constituent parts, and the rights and obligations of the Holder of such
Stripped Unit in respect of the Pledged Treasury Security and the Purchase
Contract comprising such Stripped Unit may be acquired, and may be transferred
and exchanged, only as a Stripped Unit.
B-7
A Holder of Normal Units may establish Stripped Units at any time from
and after the date of the Purchase Contract Agreement and on or prior to the
thirteenth Business Day immediately preceding the Stock Purchase Date by
depositing with the Collateral Agent Treasury Securities in exchange for the
release of the Pledged Notes or the Pledged Treasury Consideration in accordance
with the terms of the Purchase Contract Agreement and the Pledge Agreement.
Subject to the next succeeding paragraph, the Company shall pay, on
each Payment Date, the Contract Adjustment Payments, if any, payable in respect
of each Purchase Contract to the Person in whose name the Stripped Units
Certificate (or one or more Predecessor Stripped Units Certificates) evidencing
such Purchase Contract is registered on the Stripped Units Register at the close
of business on the Record Date next preceding such Payment Date. Contract
Adjustment Payments, if any, will be payable at the office of the Agent in The
City of New York or, at the option of the Company, by check mailed to the
address of the Person entitled thereto as such address appears on the Stripped
Units Register or by wire transfer to the account designated by such Person in
writing.
The Company shall have the right, at any time prior to the Stock
Purchase Date, to defer the payment of any or all of the Contract Adjustment
Payments otherwise payable on any Payment Date, but only if the Company shall
give the Holders and the Agent written notice of its election to defer each such
Contract Adjustment Payments as provided in the Purchase Contract Agreement. Any
Contract Adjustment Payments so deferred shall, to the extent permitted by law,
accrue additional Contract Adjustment Payments thereon at the rate of 6.50% per
year (computed on the basis of a 360-day year of twelve 30-day months),
compounding on each succeeding Payment Date, until paid in full (such deferred
installments of Contract Adjustment Payments, if any, together with the
additional Contract Adjustment Payments, if any, accrued thereon, are referred
to herein as the "Deferred Contract Adjustment Payments"). Deferred Contract
Adjustment Payments, if any, shall be due on the next succeeding Payment Date
except to the extent that payment is deferred pursuant to the Purchase Contract
Agreement. No Contract Adjustment Payments may be deferred to a date that is
after the Stock Purchase Date and no such deferral period may end other than on
a Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until a Payment Date prior to the
Stock Purchase Date, then all Deferred Contract Adjustment Payments, if any,
shall be payable to the registered Holders as of the close of business on the
Record Date immediately preceding such Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until the Stock Purchase Date, the
Holder of this Stripped Units Certificate will receive on the Stock Purchase
Date, in lieu of a cash payment, a number of Ordinary Shares (in addition to the
number of Ordinary Shares equal to the Settlement Rate) equal to (i) the
aggregate amount of Deferred Contract Adjustment Payments payable to the Holder
of this Stripped Units Certificate divided by (ii) the Applicable Market Value.
The Company's obligations with respect to Contract Adjustment Payments
(including any accrued or Deferred Contract Adjustment Payments) will be
subordinated and junior in
B-8
right of payment to the Company's obligations under any Senior Indebtedness in
the manner and to the extent set forth in the Purchase Contract Agreement.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, then, until the earlier of (x) the Termination
Date and (y) the date on which the Deferred Contract Adjustment Payments have
been paid, the Company shall not, and will not permit any subsidiary of the
Company to, declare or pay dividends on, make distributions with respect to, or
redeem, purchase or acquire, or make a liquidation payment with respect to, any
of the Company's Capital Stock other than (i) repurchases, redemptions or
acquisitions of Ordinary Shares of the Company in connection with any employment
contract, benefit plan or other similar arrangement with or for the benefit of
employees, officers, directors or agents or a stock purchase or dividend
reinvestment plan, or the satisfaction by the Company of its obligations
pursuant to any contract or security outstanding on the date the Company
exercises its rights to defer the Contract Adjustment Payments; (ii) as a result
of a reclassification of the Company's Capital Stock or the exchange or
conversion of one class or series of the Company's Capital Stock for another
class or series of the Company's Capital Stock; (iii) the purchase of fractional
interests in shares of any series of the Company's Capital Stock pursuant to the
conversion or exchange provisions of such Capital Stock or the security being
converted or exchanged; (iv) dividends or distributions in any series of the
Company's Capital Stock (or rights to acquire the Company's Capital Stock) or
repurchases, redemptions or acquisitions of the Company's Capital Stock in
exchange for or out of the net cash proceeds of the sale of the Company's
Capital Stock (or securities convertible into or exchangeable for shares of the
Company's Capital Stock); or (v) redemptions, exchanges or repurchases of any
rights outstanding under a shareholder rights plan on the date the Company
exercises its right to defer the payment of Contract Adjustment Payments or the
declaration or payment thereunder of a dividend or distribution of or with
respect to rights in the future, or the redemption or repurchase of any rights
pursuant thereto.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive accumulated Contract Adjustment Payments, if any, or any
Deferred Contract Adjustment Payments, and the obligations of the Holders to
purchase Ordinary Shares, shall immediately and automatically terminate, without
the necessity of any notice or action by any Holder, the Agent or the Company,
if, on or prior to the Stock Purchase Date, a Termination Event shall have
occurred. Upon the occurrence of a Termination Event, the Company shall promptly
but in no event later than two business days thereafter give written notice to
the Agent, the Collateral Agent and to the Holders, at their addresses as they
appear in the Stripped Units Register. Upon and after the occurrence of a
Termination Event, the Collateral Agent shall release the Pledged Treasury
Securities from the Pledge in accordance with the provisions of the Pledge
Agreement.
Upon registration of transfer of this Stripped Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract
Agreement, the Purchase Contracts evidenced hereby and the Pledge Agreement and
the transferor shall be released from the obligations under the Purchase
Contract Agreement, the Purchase Contracts evidenced by this Stripped Units
Certificate and the Pledge
B-9
Agreement. The Company covenants and agrees, and the Holder, by his acceptance
hereof, likewise covenants and agrees, to be bound by the provisions of this
paragraph.
The Holder of this Stripped Units Certificate, by its acceptance
hereof, irrevocably authorizes the Agent to enter into and perform the related
Purchase Contracts forming part of the Stripped Units evidenced hereby on his
behalf as its attorney-in-fact, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company, any
receiver, liquidator or person or entity performing similar functions or its
trustee in the event that the Company becomes the debtor under the Bankruptcy
Code or subject to other similar state or federal or other law, agrees to be
bound by the terms and provisions thereof, covenants and agrees to perform such
Holder's obligations under such Purchase Contracts, consents to the provisions
of the Purchase Contract Agreement, irrevocably authorizes the Agent to enter
into and perform the Pledge Agreement on such Holder's behalf as
attorney-in-fact, and consents to the Pledge of the Treasury Securities
underlying this Stripped Units Certificate pursuant to the Pledge Agreement,
provided that upon a Termination Event, the rights of the Holder of such
Stripped Units may be enforced without regard to any other rights or
obligations. The Holder further covenants and agrees, that, to the extent and in
the manner provided in the Purchase Contract Agreement and the Pledge Agreement,
but subject to the terms thereof, payments in respect of the Pledged Treasury
Securities, to be paid upon settlement of such Holder's obligations to purchase
Ordinary Shares under the Purchase Contract, shall be paid on the Stock Purchase
Date by the Collateral Agent to the Company in satisfaction of such Holder's
obligations under such Purchase Contract and such Holder shall acquire no right,
title or interest in such payments. The obligations of each Holder to pay the
Purchase Price are non-recourse obligations and except to the extent paid by
Early Settlement or Merger Early Settlement, are payable solely out of the
proceeds of any Collateral pledged to secure the obligations of the Holders and
in no event will Holders be liable for any deficiency between such payments and
the Purchase Price.
Each Holder of any Unit, and each Beneficial Owner thereof, by its
acceptance thereof or of its interest therein, further agrees to treat (i) the
formation of Stripped Units as the purchase of a Unit consisting of the Purchase
Contract and the Treasury Securities and (ii) itself as the owner of the related
Notes, Treasury Consideration or Treasury Securities, as the case may be.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by and deemed
to be a contract under, and construed in accordance with, the laws of the State
of New York.
The Company, the Agent and its Affiliates and any agent of the Company
or the Agent may treat the Person in whose name this Stripped Units Certificate
is registered as the owner of the Stripped Units evidenced hereby for the
purpose of receiving any Contract Adjustment Payments and any Deferred Contract
Adjustment Payments, performance of the Purchase Contracts and for all other
purposes whatsoever, whether or not any payments in respect thereof be overdue
and notwithstanding any notice to the contrary, and neither the Company, the
Agent, such Affiliate, nor any such agent shall be affected by notice to the
contrary.
B-10
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of Ordinary Shares.
A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Agent.
B-11
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - Custodian
-------------------------------------------
(cust) (minor)
Under Uniform Gifts to Minors Act
-------------------------------------------
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship
and not as tenants in common
Additional abbreviations may also be used though not in the above list.
B-12
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
--------------------------------------------------------------------------------
(Please insert Social Security or Taxpayer I.D. or other Identifying
Number of Assignee)
--------------------------------------------------------------------------------
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Stripped Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing ______________attorney to transfer said
Stripped Units Certificates on the books of XL Capital Ltd with full power of
substitution in the premises.
Dated:
--------- ----------------------------------------
Signature
NOTICE: The signature to this assignment
must correspond with the name as it
appears upon the face of the within
Stripped Units Certificates in every
particular, without alteration or
enlargement or any change whatsoever.
Signature Guarantee:
------------------------------------------------------------
B-13
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for Ordinary Shares
deliverable upon settlement on or after the Stock Purchase Date of the Purchase
Contracts underlying the number of Stripped Units evidenced by this Stripped
Units Certificate be registered in the name of, and delivered, together with a
check in payment for any fractional share, to the undersigned at the address
indicated below unless a different name and address have been indicated below.
If shares are to be registered in the name of a Person other than the
undersigned, the undersigned will pay any transfer tax payable incident thereto.
Dated: Signature:
---------- -----------------------------
Signature Guarantee:
-------------------
(if assigned to another person)
If shares are to be registered in the
name of and delivered to a Person other REGISTERED HOLDER
than the Holder, please (i) print such
Person's name and address and (ii) Please print name and address of
provide a guarantee of your signature: Registered Holder:
------------------------------------- ---------------------------------------
Name Name
------------------------------------- ---------------------------------------
Address Address
Social Security or other Taxpayer
Identification Number, if any:
B-14
ELECTION TO SETTLE EARLY
The undersigned Holder of this Stripped Units Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Stripped Units evidenced by this Stripped
Units Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Stripped Units with
an aggregate Purchase Price equal to $1,000 or an integral multiple thereof. The
undersigned Holder directs that a certificate for Ordinary Shares deliverable
upon such Early Settlement be registered in the name of, and delivered, together
with a check in payment for any fractional share and any Stripped Units
Certificate representing any Stripped Units evidenced hereby as to which Early
Settlement of the related Purchase Contracts is not effected, to the undersigned
at the address indicated below unless a different name and address have been
indicated below. Pledged Treasury Securities deliverable upon such Early
Settlement will be transferred in accordance with the transfer instructions set
forth below. If Ordinary Shares are to be registered in the name of a Person
other than the undersigned, the undersigned will pay any transfer tax payable
incident thereto.
Dated: Signature:
---------- -----------------------------
Signature Guarantee:
-------------------
Number of Units evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:
If Ordinary Shares are to be registered
in the name of and delivered to and REGISTERED HOLDER
Pledged Treasury Securities are to be
transferred to a Person other than the
Holder, please print such Person's name Please print name and address of
and address: Registered Holder:
------------------------------------- ---------------------------------------
Name Name
------------------------------------- ---------------------------------------
Address Address
Social Security or other Taxpayer
Identification Number, if any
Transfer instructions for Pledged Treasury Securities, transferable upon Early
Settlement or a Termination Event:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
B-15
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have
been made:
STATED AMOUNT OF
THE GLOBAL
AMOUNT OF AMOUNT OF CERTIFICATE
DECREASE IN STATED INCREASE IN STATED FOLLOWING SUCH SIGNATURE OF
AMOUNT OF THE AMOUNT OF THE DECREASE OR AUTHORIZED OFFICER
DATE GLOBAL CERTIFICATE GLOBAL CERTIFICATE INCREASE OF AGENT
---- ------------------ ------------------ -------- ------------------
B-16
EXHIBIT C
INSTRUCTION FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
U.S. Bank Trust National Association
000 Xxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: [_________________________]
Re: 6.50% Equity Security Units of XL Capital Ltd (the "Company")
We hereby notify you in accordance with Section 4.1 of the Pledge
Agreement, dated as of March 23, 2004, among the Company, you, as Collateral
Agent, Custodial Agent and Securities Intermediary, and us, as Purchase Contract
Agent and as attorney-in-fact for the holders of [Normal Units] [Stripped Units]
from time to time, that the holder of securities listed below (the "Holder") has
elected to substitute [$ ______aggregate principal amount of Treasury Securities
(CUSIP No. 000000XX0)] [$_____principal amount of Notes or the Treasury
Consideration, as the case may be,] in exchange for the related [Pledged Notes
or Pledged Treasury Consideration] [Pledged Treasury Securities (CUSIP No.
[___________]),] held by you in accordance with the Pledge Agreement and has
delivered to us a notice stating that the Holder has transferred [Treasury
Securities] [Notes or the Treasury Consideration] to you, as Collateral Agent.
We hereby instruct you, upon receipt of such [Pledged Treasury Securities]
[Pledged Notes or Pledged Treasury Consideration], and upon the payment by such
Holder of any applicable fees, to release the [Notes or Treasury Consideration,
as the case may be,] [Treasury Securities] related to such [Normal Units]
[Stripped Units] to us in accordance with the Holder's instructions. Capitalized
terms used herein but not defined shall have the meaning set forth in the
Purchase Contract Agreement.
Date:
-------------------
U.S. Bank National Association,
As Purchase Contract Agent under the Purchase
Contract Agreement, dated as of March 23, 2004,
between the Company and the Purchase Contract
Agent
By:
--------------------------------------------
Name:
Title:
C-1
Please print name and address of Registered Holder electing to substitute
[Treasury Securities] Notes or Treasury Consideration, as the case may be,] for
the Notes or Pledged Treasury Consideration, as the case may be,] [Pledged
Treasury Securities]:
------------------------------------- -----------------------------------
Name: Social Security or other Taxpayer
Identification Number, if any
-------------------------------------
Address
------------------------------------
------------------------------------
------------------------------------
C-2
EXHIBIT D
INSTRUCTION TO PURCHASE CONTRACT AGENT
U.S. Bank National Association,
as Purchase Contract Agent
000 Xxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: [__________________]
Re: 6.50% Equity Security Units of XL Capital Ltd (the "Company")
The undersigned Holder hereby notifies you, as Purchase Contract Agent
under the Purchase Contract Agreement, dated as of March 23, 2004, between the
Company and you, that it has delivered to U.S. Bank Trust National Association,
as Collateral Agent, Custodial Agent and Securities Intermediary
[$__________aggregate principal amount of Treasury Securities] [$_________
principal amount of Notes or the Treasury Consideration, as the case may be,] in
exchange for the related [Pledged Notes or Pledged Treasury Consideration, as
the case may be,] [Pledged Treasury Securities] held by the Collateral Agent, in
accordance with Section 4.1 of the Pledge Agreement, dated as of March 23, 2004,
among you, the Company and the Collateral Agent. The undersigned Holder has paid
the Collateral Agent all applicable fees relating to such exchange. The
undersigned Holder hereby instructs you to instruct the Collateral Agent to
release to you on behalf of the undersigned Holder the [Pledged Notes or Pledged
Treasury Consideration, as the case may be,] [Pledged Treasury Securities]
related to such [Normal Units] [Stripped Units]. Capitalized terms used herein
but not defined shall have the meaning set forth in the Purchase Contract
Agreement.
Date: By:
---------------- ----------------------------------------
-------------------------------------------
Signature Guarantee:
D-1
Dated:
Please print name and address of
Registered Holder:
Name: Social Security or other Taxpayer
------------------------------------ Identification Number, if any:
-------------------------------------
Address:
------------------------------------------
------------------------------------------
------------------------------------------
D-2
EXHIBIT E
NOTICE TO SETTLE BY SEPARATE CASH
U.S. Bank National Association,
as Purchase Contract Agent
000 Xxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: __________________]
Re: 6.50% Equity Security Units of XL Capital Ltd (the "Company")
The undersigned Holder hereby notifies you in accordance with Section
5.4 of the Purchase Contract Agreement, dated as of March 23, 2004, between the
Company and you, as Purchase Contract Agent, Attorney-in-Fact and Trustee for
the Holders of the Purchase Contracts, that it has delivered to U.S. Bank Trust
National Association, as Collateral Agent, Custodial Agent and Securities
Intermediary, that such Holder has elected to pay to the Collateral Agent, on or
prior to 11:00 a.m. New York City time, on the thirteenth Business Day
immediately preceding the Stock Purchase Date, (in lawful money of the United
States by certified or cashier's check or wire transfer, in each case in
immediately available funds), $___ as the Purchase Price for the Ordinary Shares
issuable to such Holder by the Company under the related Purchase Contract on
the Stock Purchase Date. The undersigned Holder hereby instructs you to notify
promptly the Collateral Agent of the undersigned Holder's election to make such
cash settlement with respect to the Purchase Contracts related to such Holder's
Normal Units. Capitalized terms used herein but not defined shall have the
meaning set forth in the Purchase Contract Agreement.
Dated: By:
------------------ ------------------------------------
Signature Guarantee:
-------------------------------------
E-1
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Please print name and address of Social Security or other Taxpayer
Registered Holder: Identification Number, if any
------------------------------------- ---------------------------------------
Name
-------------------------------------
Address
E-2
EXHIBIT F
FORMULA FOR FIXING SETTLEMENT RATE
F-1
