Exhibit 4.02
CALCULATION AGENCY AGREEMENT
CALCULATION AGENCY AGREEMENT, dated as of October 18, 2002
(the "Agreement"), between Xxxxxx Brothers Holdings Inc. (the "Company") and
Xxxxxx Brothers Inc., as Calculation Agent.
WHEREAS, the Company has authorized the issuance of up to
$7,015,000 aggregate principal amount of S&P 500(R) Index SUNS(R), 106.4%
Minimum Redemption PrincipalPlus Stock Upside Note Securities(R) Due October 18,
2008 (the "Securities")*;
WHEREAS, the Securities will be issued under an Indenture,
dated as of September 1, 1987, between the Company and Citibank, N.A., as
Trustee (the "Trustee"), as supplemented and amended by supplemental indentures
dated as of November 25, 1987, November 27, 1990, September 13, 1991, October 4,
1993, October 1, 1995, and June 26, 1997, and incorporating Standard Multiple
Series Indenture Provisions dated July 30, 1987, as amended November 16, 1987
(collectively, the "Indenture"); and
WHEREAS, the Company requests the Calculation Agent to perform
certain services described herein in connection with the Securities;
NOW THEREFORE, the Company and the Calculation Agent agree as
follows:
1. Appointment of Agent. The Company hereby appoints
Xxxxxx Brothers Inc. as Calculation Agent and Xxxxxx Brothers Inc. hereby
accepts such appointment as the Company's agent for the purpose of
performing the services hereinafter described upon the terms and subject to the
conditions hereinafter mentioned.
2. Calculations and Information Provided. In response to a
request made by the Trustee for a determination of the Maturity Payment Amount
due at Stated Maturity of the Securities, the Calculation Agent shall determine
such Maturity Payment Amount and notify the Trustee of its determination. The
Calculation Agent shall also be responsible for (a) the determination of the
Maturity Payment Amount, (b) the determination of the Equity Bonus, (c) the
determination of the Successor Index if publication of the Index is
discontinued, (d) adjustments to the Closing Level and (e) the determination of
whether a Market Disruption Event has occurred. The Calculation Agent shall
notify the Trustee of any such adjustment or any such Successor Index, or if a
Market Disruption Event has occurred. Annex A hereto sets forth the procedures
the Calculation Agent will use to determine the information described in this
Section 2.
* "Standard & Poor's(R)," "S&P(R)," "S&P 500(R)," "Standard & Poor's
500," and "500" are trademarks of XxXxxx-Xxxx, Inc. and have been
licensed for use by Xxxxxx Brothers Holdings Inc. The notes, based on
the performance of the S&P 500(R) Index, are not sponsored, endorsed,
sold or promoted by Standard & Poor's and Standard & Poor's makes no
representation regarding the advisability of investing in the notes.
"Stock Upside Note Securities" and "SUNS" are trademarks of Xxxxxx
Brothers Inc.
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3. Calculations. Any calculation or determination
by the Calculation Agent pursuant hereto shall (in the absence of manifest
error) be final and binding. Any calculation made by the Calculation
Agent hereunder shall, at the Trustee's request, be made available at the
Corporate Trust Office.
4. Fees and Expenses. The Calculation Agent shall be
entitled to reasonable compensation for all services rendered by it as agreed
to between the Calculation Agent and the Company.
5. Terms and Conditions. The Calculation Agent
accepts its obligations herein set out upon the terms and conditions hereof,
including the following, to all of which the Company agrees:
(a) in acting under this Agreement, the Calculation Agent is
acting solely as an independent expert of the Company and does not
assume any obligation toward, or any relationship of agency or trust
for or with, any of the holders of the Securities;
(b) unless otherwise specifically provided herein, any order,
certificate, notice, request, direction or other communication from the
Company or the Trustee made or given under any provision of this
Agreement shall be sufficient if signed by any person who the
Calculation Agent reasonably believes to be a duly authorized officer
or attorney-in-fact of the Company or the Trustee, as the case may be;
(c) the Calculation Agent shall be obliged to perform
only such duties as are set out specifically herein and any duties necessarily
incidental thereto;
(d) the Calculation Agent, whether acting for itself or in any
other capacity, may become the owner or pledgee of Securities with the
same rights as it would have had if it were not acting hereunder as
Calculation Agent; and
(e) the Calculation Agent shall incur no liability hereunder
except for loss sustained by reason of its gross negligence or wilful
misconduct.
6. Resignation; Removal; Successor. (a) The Calculation Agent
may at any time resign by giving written notice to the Company of such intention
on its part, specifying the date on which its desired resignation shall become
effective, subject to the appointment of a successor Calculation Agent and
acceptance of such appointment by such successor Calculation Agent, as
hereinafter provided. The Calculation Agent hereunder may be removed at any time
by the filing with it of an instrument in writing signed by or on behalf of the
Company and specifying such removal and the date when it shall become effective.
Such resignation or removal shall take effect upon the appointment by the
Company, as hereinafter provided, of a successor Calculation Agent and the
acceptance of such appointment by such successor Calculation Agent. In the event
a successor Calculation Agent has not been appointed and has not accepted its
duties within 90 days of the Calculation Agent's notice of resignation, the
Calculation Agent may apply to any court of competent jurisdiction for the
designation of a successor Calculation Agent.
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(b) In case at any time the Calculation Agent shall resign, or
shall be removed, or shall become incapable of acting, or shall be adjudged
bankrupt or insolvent, or make an assignment for the benefit of its creditors or
consent to the appointment of a receiver or custodian of all or any substantial
part of its property, or shall admit in writing its inability to pay or meet its
debts as they mature, or if a receiver or custodian of it or all or any
substantial part of its property shall be appointed, or if any public officer
shall have taken charge or control of the Calculation Agent or of its property
or affairs, for the purpose of rehabilitation, conservation or liquidation, a
successor Calculation Agent shall be appointed by the Company by an instrument
in writing, filed with the successor Calculation Agent. Upon the appointment as
aforesaid of a successor Calculation Agent and acceptance by the latter of such
appointment, the Calculation Agent so superseded shall cease to be Calculation
Agent hereunder.
(c) Any successor Calculation Agent appointed hereunder shall
execute, acknowledge and deliver to its predecessor, to the Company and to the
Trustee an instrument accepting such appointment hereunder and agreeing to be
bound by the terms hereof, and thereupon such successor Calculation Agent,
without any further act, deed or conveyance, shall become vested with all the
authority, rights, powers, trusts, immunities, duties and obligations of such
predecessor with like effect as if originally named as Calculation Agent
hereunder, and such predecessor, upon payment of its charges and disbursements
then unpaid, shall thereupon become obligated to transfer, deliver and pay over,
and such successor Calculation Agent shall be entitled to receive, all moneys,
securities and other property on deposit with or held by such predecessor, as
Calculation Agent hereunder.
(d) Any corporation into which the Calculation Agent hereunder
may be merged or converted or any corporation with which the Calculation Agent
may be consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Calculation Agent shall be a party, or any
corporation to which the Calculation Agent shall sell or otherwise transfer all
or substantially all of the assets and business of the Calculation Agent shall
be the successor Calculation Agent under this Agreement without the execution or
filing of any paper or any further act on the part of any of the parties hereto.
7. Certain Definitions. Terms not otherwise defined
herein or in Annex A hereto are used herein as defined in the Indenture or the
Securities.
8. Indemnification. The Company will indemnify the Calculation
Agent against any losses or liability which it may incur or sustain in
connection with its appointment or the exercise of its powers and duties
hereunder except such as may result from the gross negligence or wilful
misconduct of the Calculation Agent or any of its agents or employees. The
Calculation Agent shall incur no liability and shall be indemnified and held
harmless by the Company for or in respect of any action taken or suffered to be
taken in good faith by the Calculation Agent in reliance upon written
instructions from the Company.
9. Notices. Any notice required to be given hereunder shall be
delivered in person, sent (unless otherwise specified in this Agreement) by
letter, telex or facsimile transmission or communicated by telephone (confirmed
in a writing dispatched within two Business Days), (a) in the case of the
Company, to it at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (facsimile: (646)
000-0000) (telephone: (000) 000-0000), Attention: Treasurer, with a copy to 000
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 (facsimile: (000) 000-0000) (telephone:
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(000) 000-0000), Attention: Corporate Secretary, (b) in the case of the
Calculation Agent, to it at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(facsimile: (000) 000-0000) (telephone: (000) 000-0000), Attention: Equity
Derivatives Trading and (c) in the case of the Trustee, to it at 000 Xxxx
Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000 (facsimile: (000) 000-0000)
(telephone: (000) 000-0000), Attention: Corporate Trust Department or, in any
case, to any other address or number of which the party receiving notice shall
have notified the party giving such notice in writing. Any notice hereunder
given by telex, facsimile or letter shall be deemed to be served when in the
ordinary course of transmission or post, as the case may be, it would be
received.
10. Governing Law. This Agreement shall be governed
by and continued in accordance with the laws of the State of New York.
11. Counterparts. This Agreement may be executed in
any number of counterparts, each of which when so executed shall be deemed to
be an original and all of which taken together shall constitute one and
the same agreement.
12. Benefit of Agreement. This Agreement is solely
for the benefit of the parties hereto and their successors and assigns, and no
other person shall acquire or have any rights under or by virtue hereof.
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IN WITNESS WHEREOF, this Calculation Agency Agreement has been
entered into as of the day and year first above written.
XXXXXX BROTHERS HOLDINGS INC.
By:______/s/ Xxxxx Corrigan___
Name: Xxxxx Xxxxxxxx
Title: Vice President
XXXXXX BROTHERS INC.,
as Calculation Agent
By:___/s/ Xxxxx Corrigan____
Name: Xxxxx Xxxxxxxx
Title: Vice President
ANNEX A
1. The Index.
The Index is the S&P 500(R) Index, as calculated by S&P (the "Index").
2. Determination of the Equity Bonus and the Maturity Payment Amount.
The Calculation Agent shall determine (i) the Equity Bonus and
(ii) the amount payable at Stated Maturity for each $1,000 principal amount of
Securities (the "Maturity Payment Amount").
The Maturity Payment Amount shall equal the sum of (a) $1,064
and (b) the Equity Bonus.
3. Discontinuance of the Index.
(a) If S&P discontinues publication of the Index and S&P or another entity
publishes a successor or substitute index (the "Successor Index") that the
Calculation Agent determines, in its sole discretion, to be comparable to the
discontinued Index, then the Calculation Agent shall calculate the Equity Bonus
and the Maturity Payment Amount pursuant to Section 2 hereof by reference to the
index level of such Successor Index at the Close of Trading on the NYSE, AMEX,
Nasdaq or the relevant exchange or market for the Successor Index on the
Calculation Date.
(b) Upon any selection by the Calculation Agent of a Successor Index, the
Company shall promptly give notice to the holders of the Securities.
(c) If S&P discontinues publication of the Index prior to, and such
discontinuance is continuing on, the Calculation Date and the Calculation Agent
determines that no Successor Index is available at such time, then, on such
date, the Calculation Agent shall determine the index to be used in computing
the Equity Bonus and the Maturity Payment Amount. The Equity Bonus and the
Maturity Payment Amount shall be computed by the Calculation Agent in accordance
with the formula for and method of calculating the Index last in effect prior to
such discontinuance, using the Closing Level (or, if trading in the relevant
securities has been materially suspended or materially limited, its good faith
estimate of the Closing Level that would have prevailed but for such suspension
or limitation) at the close of the principal trading session on such date of
each security most recently comprising the Index on the primary organized U.S.
exchange or trading system.
4. Alteration of Method of Calculation.
If at any time the method of calculating the Index or a
Successor Index, or the Closing Level thereof, is changed in a material respect,
or if the Index or a Successor Index is in any other way modified so that such
Index does not, in the opinion of the Calculation Agent, fairly represent the
value of the Index or such Successor Index had such changes or modifications not
been made, then, from and after such time, the Calculation Agent will, at the
Close of Trading in New York City on the Calculation Date, make such
calculations and adjustments as, in the good faith judgment of the Calculation
Agent, may be necessary in order to arrive at a level of a stock index
comparable to the Index or such Successor Index, as the case may be, as if such
changes or modifications had not been made, and calculate the Equity Bonus and
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the Maturity Payment Amount with reference to the Index or such Successor Index,
as adjusted. Accordingly, if the method of calculating the Index or a Successor
Index is modified so that the level of such index is a fraction of what it would
have been if it had not been modified (for example, due to a split in the
index), then the Calculation Agent shall adjust such index in order to arrive at
a level of the Index or such Successor Index as if it had not been modified (for
example, if such split had not occurred).
5. Definitions.
Set forth below are the terms used in the Agreement and in
this Annex A.
"Agreement" shall have the meaning set forth in the preamble
to this Agreement.
"AMEX" shall mean the American Stock Exchange LLC.
"Business Day", notwithstanding any provision in the
Indenture, shall mean any day that is not a Saturday, a Sunday or a day on which
the NYSE, the Nasdaq or the AMEX is not open for trading or banking institutions
or trust companies in the City of New York are authorized or obligated by law or
executive order to close.
"Calculation Agent" shall mean the person that has entered
into an agreement with the Company providing for, among other things, the
determination of the Equity Bonus and the Maturity Payment Amount, which term
shall, unless the context otherwise requires, include its successors and
assigns. The initial Calculation Agent shall be Xxxxxx Brothers Inc.
"Calculation Date" shall mean October 14, 2008; provided, that
if a Market Disruption Event occurs on such day, then the Calculation Date shall
be the next following Business Day on which no Market Disruption Event occurs.
"Close of Trading" shall mean 4:00 p.m., New York City time.
"Closing Level" shall mean, with respect to any day, the last
reported level of the Index, the Successor Index or any security which is a
component of either such index, as the case may be, at the Close of Trading, as
reported by S&P, the publisher of the Successor Index or the primary exchange on
which any such security then trades, as the case may be.
"Company" shall have the meaning set forth in the preamble to
this Agreement.
"Equity Bonus" shall mean, with respect to each $1,000
principal amount of Securities, the greater of (i) zero and (ii) the product of:
(i) $1,000; and
Final Index ------ Initial Index
(ii) ( 0.50 x Level Level ) - 0.064
Initial Index Level
"Final Index Level" shall equal the Closing Level on the
Calculation Date.
"Indenture" shall have the meaning set forth in the preamble
to this Agreement.
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"Index" shall have the meaning set forth in Section 1 of this
Annex A.
"Initial Index Level" shall mean 835.32, the Closing Level on
October 11, 2002.
"Market Disruption Event", on any day, shall mean any of the
following events as determined by the Calculation Agent:
(i) A suspension, absence or material limitation of trading in
20% or more of the underlying stocks which then comprise the Index or
any Successor Index, as the case may be, has occurred on that day, in
each case, for more than two hours of trading or during the one-half
hour period preceding the Close of Trading on the primary organized
U.S. exchange or trading system on which such stocks are traded or, in
the case of a common stock not listed or quoted in the United States,
on the primary exchange, trading system or market for that security.
Limitations on trading during significant market fluctuations imposed
pursuant to NYSE Rule 80B or any applicable rule or regulation enacted
or promulgated by the NYSE, any other exchange, trading system or
market, any other self regulatory organization or the Securities and
Exchange Commission of similar scope or as a replacement for Rule 80B,
may be considered material. Notwithstanding the first sentence of this
paragraph, a Market Disruption Event for a security traded on a
bulletin board means a suspension, absence or material limitation of
trading of that security for more than two hours or during the one hour
period preceding 4:00 p.m., New York City time.
(ii) A suspension, absence or material limitation has occurred
on that day, in each case, for more than two hours of trading or during
the one-half hour period preceding the Close of Trading in options
contracts related to the Index or any Successor Index, as the case may
be, whether by reason of movements in price exceeding levels permitted
by an exchange, trading system or market on which such options
contracts are traded or otherwise.
(iii) Information is unavailable on that date, through a
recognized system of public dissemination of transaction information,
for more than two hours of trading or during the one-half hour period
preceding the Close of Trading, of accurate price, volume or related
information in respect of 20% or more of the underlying stocks which
then comprise the Index or any Successor Index, as the case may be, or
in respect of options contracts related to the Index or any Successor
Index, as the case may be, in each case traded on any major U.S.
exchange or trading system or in the case of securities of a non-U.S.
issuer, traded on the primary non-U.S. exchange, trading system or
market.
For purposes of determining whether a Market Disruption Event has
occurred:
(i) a limitation on the hours or number of days of trading
shall not constitute a Market Disruption Event if it results from an
announced change in the regular business hours of the relevant
exchange, trading system or market;
(ii) any suspension in trading in an options contract on the
Index or any Successor Index, as the case may be, by a major securities
exchange, trading system or market by reason of (a) a price change
violating limits set by such securities market, (b) an imbalance of
orders relating to those contracts, or (c) a disparity in bid and ask
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quotes relating to those contracts, shall constitute a Market
Disruption Event notwithstanding that the suspension or material
limitation is less than two hours;
(iii) a suspension or material limitation on an exchange,
trading system or in a market shall include a suspension or material
limitation of trading by one class of investors provided that the
suspension continues for more than two hours of trading or during the
last one-half hour period preceding the Close of Trading on the
relevant exchange, trading system or market but shall not include any
time when the relevant exchange, trading system or market is closed for
trading as part of that exchange's, trading system's or market's
regularly scheduled business hours; and
(iv) "Trading systems" include bulletin board
services.
"Maturity Payment Amount" shall have the meaning set forth in
Section 2 of this Annex A.
"Nasdaq" shall mean The Nasdaq Stock Market, Inc.
"NYSE" shall mean The New York Stock Exchange, Inc.
"S&P" shall mean Standard & Poor's, a division of XxXxxx-Xxxx,
Inc.
"Stated Maturity" shall mean October 18, 2008 (or if October
18, 2008 is not a Business Day, on the next Business Day); provided, that if a
Market Disruption Event occurs on the Calculation Date, the Stated Maturity
shall be the fourth Business Day following the date that the Final Index Level
is determined.
"Successor Index" shall have the meaning set forth in Section
3(a) of this Annex A.
"Trustee" shall have the meaning set forth in the preamble to
this Agreement.
