Exhibit 4.2
DEED OF COVENANT
THIS DEED OF COVENANT is made on 27th March, 2002 by each of Ciba Specialty
Chemicals Corporation, Ciba Specialty Chemicals PLC, Ciba Spezialitatenchemie
Holding Deutschland GmbH and Ciba Specialty Chemicals Eurofinance Ltd. (each
an "ISSUER") in favour of the account holders of Clearstream Banking, societe
anonyme ("CLEARSTREAM, LUXEMBOURG") and Euroclear Bank S.A./N.V. as operator
of the Euroclear System ("EUROCLEAR"), or any successor to the business
thereof or any other additional clearing system or systems as are specified in
the Pricing Supplement relating to any Note (as defined below) (each a
"CLEARING SYSTEM").
WHEREAS:
(A) Each Issuer has entered into an amended and restated Program
Agreement (the "PROGRAM AGREEMENT", which expression includes the
same as it may be amended, supplemented, novated or restated from
time to time) dated 27th March, 2002 with Ciba Specialty Chemicals
Holding Inc. (the "GUARANTOR") and the Dealers named therein under
which the relevant Issuer proposes from time to time to issue Euro
Medium Term Notes (the "NOTES"), which amends and restates the
amended and restated program agreement dated 16th June, 2000 with
Ciba Specialty Chemicals Corporation, Ciba Specialty Chemicals PLC,
Ciba Spezialitatenchemie Holdings Deutschland GmbH, Ciba Specialty
Chemicals Eurofinance Ltd., the Guarantor and the Dealers named
therein (the "PRINCIPAL PROGRAM AGREEMENT").
(B) Each Issuer has also entered into an amended and restated Agency
Agreement (the "AGENCY AGREEMENT", which expression includes the same
as it may be amended, supplemented, novated or restated from time to
time) dated 27th March, 2002 between, inter alios, the Issuer and
JPMorgan Chase Bank (the "AGENT").
(C) The Notes will initially be represented by, and comprised in,
Temporary Global Notes (the "TEMPORARY GLOBAL NOTES") and thereafter
may be represented by, and comprised in, Permanent Global Notes (the
"PERMANENT GLOBAL NOTES" and together with the Temporary Global
Notes, the "GLOBAL NOTES"), such Global Notes representing a certain
number of underlying Notes (the "UNDERLYING NOTES").
(D) Each Global Note will, after issue, be deposited with a common
depository for one or more Clearing Systems (each such Clearing
System or all such Clearing Systems together, the "RELEVANT CLEARING
SYSTEM"). Upon such deposit of a Global Note the Underlying Notes
represented by such Global Note will be credited to a securities
account or securities accounts with the Relevant Clearing System. Any
account holder with the Relevant Clearing System which has Underlying
Notes credited to its securities account from time to time (each a
"RELEVANT ACCOUNT HOLDER") will, subject to and in accordance with
the terms and conditions and operating procedures or management
regulations of the Relevant Clearing System, be entitled to transfer
such Underlying Notes and (subject to and upon payment being made by
the relevant Issuer to the bearer in accordance with the terms of the
relevant Global Note) will be entitled to receive payments from the
Relevant Clearing System calculated by reference to the Underlying
Notes credited to its securities account.
(E) In certain circumstances specified in each Global Note, a Global Note
will become void. The time at which a Global Note becomes void is
hereinafter referred to as the "RELEVANT TIME". In such circumstances
each Relevant Account Holder will, subject to and in accordance with
the terms of this Deed, acquire against the relevant Issuer all those
rights which such Relevant Account Holder would have had if, prior to
the Global Note becoming void, duly executed
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and authenticated Definitive Note(s) (as defined in the Agency
Agreement) and, if the Notes are repayable in instalments, receipts
in respect thereof (the "Receipts") and interest coupons (the
"Coupons") appertaining to the Definitive Note(s) (if appropriate)
had been issued in respect of its Underlying Note(s) and such
Definitive Notes(s), Receipts (if appropriate) and Coupons (if
appropriate) were held and beneficially owned by such Relevant
Account Holder.
(F) The obligations of each Issuer under this Deed have been guaranteed
by the Guarantor pursuant to the amended and restated Deed of
Guarantee (the "Guarantee") executed by the Guarantor on 27th March,
2002 and an executed copy of the Guarantee has been deposited with
and shall be held by the Agent for the time being for the Notes. A
copy of the Guarantee shall be available for inspection at the office
of the Agent for the time being (being at the date hereof at Xxxxxxx
Xxxxx, 0 Xxxxxx Xxxx Xxxxxx, Xxxxxx X0 0XX).
(G) This Deed of Covenant amends and restates the amended and restated
Deed of Covenant entered into by Ciba Specialty Chemicals
Corporation, Ciba Specialty Chemicals PLC and Ciba
Spezialitatenchemie Holding Deutschland GmbH dated 30th March, 2001.
This Deed of Covenant does not affect any Notes issued pursuant to
the Principal Program Agreement prior to the date hereof.
NOW THIS DEED WITNESSES AS FOLLOWS:
1. If any Global Note becomes void in accordance with the terms thereof
the relevant Issuer hereby undertakes and covenants with each
Relevant Account Holder (other than when any Relevant Clearing System
is an account holder of any other Relevant Clearing System) that each
Relevant Account Holder shall automatically acquire at the Relevant
Time, without the need for any further action on behalf of any
person, against the relevant Issuer all those rights which such
Relevant Account Holder would have had if at the Relevant Time it
held and beneficially owned duly executed and authenticated
Definitive Note(s), Receipts (if appropriate) and Coupons (if
appropriate) in respect of each Underlying Note represented by such
Global Note which such Relevant Account Holder has credited to its
securities account with the Relevant Clearing System at the Relevant
Time. The relevant Issuer's obligation pursuant to this clause shall
be a separate and independent obligation by reference to each
Underlying Note which a Relevant Account Holder has credited to its
securities account with the Relevant Clearing System and the relevant
Issuer agrees that a Relevant Account Holder may assign its rights
hereunder in whole or in part.
2. The records of the Relevant Clearing System shall be conclusive
evidence of the identity of the Relevant Account Holders and the
number of Underlying Notes credited to the securities account of each
Relevant Account Holder. For the purposes hereof a statement issued
by the Relevant Clearing System stating:
(i) the name of the Relevant Account Holder to which such
statement is issued; and
(ii) the aggregate nominal amount of Underlying Notes credited to
the securities account of such Relevant Account Holder as at
the opening of business on the first day following the
Relevant Time on which the Relevant Clearing System is open
for business,
shall be conclusive evidence of the records of the Relevant Clearing
System at the Relevant Time.
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3. In the event of a dispute, the determination of the Relevant Time by
the Relevant Clearing System shall be final and conclusive for all
purposes in connection with the Relevant Account Holders with
securities accounts with the Relevant Clearing System.
4.(a) Where the Issuer is Ciba Specialty Chemicals Corporation:
The Issuer will, subject to the exceptions and limitations set forth
below, pay as additional interest on an Underlying Note such
additional amounts as are necessary in order that the net amounts
receivable pursuant to the terms of the Underlying Note by each
Relevant Account Holder who is a United States Alien (as such term is
defined below), after deduction for any present or future tax,
assessment or governmental charge of the United States (as such term
is defined below), or a political subdivision or authority thereof or
therein, imposed by withholding with respect to the payment, will not
be less than the amounts provided for in such Underlying Note to be
then due and payable; provided, however, that the foregoing
obligation to pay additional amounts shall not apply to:
(i) any tax, assessment or governmental charge that would not
have been so imposed but for the existence of any present or
former connection between such Relevant Account Holder (or
between a fiduciary, settlor, beneficiary, member or
shareholder of, or holder of power over, such holder, if
such Relevant Account Holder is an estate, trust,
partnership or corporation) and the United States,
including, without limitation, such Relevant Account Holder
(or fiduciary, settlor, beneficiary, member, shareholder or
holder of a power) being considered as:
(A) being or having been present or engaged in a trade
or business in the United States or having or
having had a permanent establishment therein;
(B) having a current or former relationship with the
United States, including a relationship as a
citizen or resident or being treated as a resident
thereof;
(C) being or having been a personal holding company, a
controlled foreign corporation, a passive foreign
investment company, a foreign personal holding
company with respect to the United States, a
corporation that has accumulated earnings to avoid
United States Federal income tax or a private
foundation or other tax-exempt organisation; or
(D) an actual or a constructive "10-per cent
shareholder" of the Issuer as defined in Section
871(h)(3) of the United States Internal Revenue
Code of 1986, as amended (the "CODE");
(ii) any Relevant Account Holder who is a fiduciary or
partnership or other than the sole beneficial owner of the
Underlying Note, but only to the extent that a beneficiary
or settlor with respect to such fiduciary or member of such
partnership or a beneficial owner of the Underlying Note
would not have been entitled to the payment of an additional
amount had such beneficiary, settlor, member or beneficial
owner been the Relevant Account Holder of such Underlying
Note;
(iii) any tax, assessment or governmental charge that would not
have been imposed or withheld but for the failure of the
Relevant Account Holder, if required, to comply with
certification, identification or information reporting
requirements under United States income tax laws, without
regard to any tax treaty, with respect to the payment,
concerning the nationality, residence, identity or
connection with the United States of the Relevant Account
Holder or a beneficial owner of such Underlying Note, if
such
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compliance is required by United States income tax laws,
without regard to any tax treaty, as a precondition to
relief or exemption from such tax, assessment or
governmental charge;
(iv) any estate, inheritance, gift, sales, transfer, excise,
wealth or personal property tax or any similar tax,
assessment or governmental charge;
(v) any tax, assessment or governmental charge that is payable
otherwise than by withholding from the payment of the
amounts receivable in respect of such Underlying Note;
(vi) any tax, assessment or governmental charge required to be
withheld by any paying agent from such payment of amounts
receivable in respect of any Underlying Note, if such
payment can be made without such withholding by any other
paying agent; or
(vii) any combination of items (i), (ii), (iii), (iv), (v) or
(vi).
As used in this Clause, "UNITED STATES" means the United States of
America, the Commonwealth of Puerto Rico and each possession of the
United States of America and place subject to its jurisdiction and
"UNITED STATES ALIEN" means any corporation, partnership, individual
or fiduciary that, as to the United States, is for United States
Federal income tax purposes (A) a foreign corporation, (B) a foreign
partnership one or more of the members of which is, for United States
Federal income tax purposes, a foreign corporation, a non-resident
alien individual or a non-resident alien fiduciary of a foreign
estate or trust, (C) a non-resident alien individual or (D) a
non-resident alien fiduciary of a foreign estate or trust.
(b) Where the Issuer is Ciba Spezialitatenchemie Holding Deutschland
GmbH:
All payments in respect of the Underlying Note by the Issuer will be
made without withholding or deduction for or on account of any
present or future taxes or duties of whatever nature imposed or
levied by or on behalf of Germany or any state (Bundesland),
municipality or other political subdivision or any authority thereof
or therein having power to tax, unless such withholding or deduction
is required by law. In such event, the Issuer will pay such
additional amounts as shall be necessary in order that the net
amounts received by the Relevant Account Holders after such
withholding or deduction shall equal the amounts which would
otherwise have been receivable in respect of the Underlying Note in
the absence of such withholding or deduction; except that no such
additional amounts shall be payable with respect to any Underlying
Note to or to the order of a Relevant Account Holder who is liable
for such taxes or duties in respect of such Underlying Note by reason
of his having some connection with Germany other than the mere
holding of such Underlying Note or with respect to any Underlying
Note presented for payment to a paying agent which is required to
deduct or withhold an amount for or on account of such taxes or
duties if such amount can be paid without any deduction or
withholding for or on account of any taxes or duties by any other
paying agent. Any advance income tax (Zinsabschlagsteuer) levied in
Germany since 1993 as well as the solidarity surcharge
(Solidaritatszuschlag) imposed thereon since 1995 do not constitute a
withholding or deduction within the meaning of this Clause 4(b).
(c) Where the Issuer is Ciba Specialty Chemicals PLC:
All payments by the Issuer in respect of the Underlying Notes shall
be made without withholding or deduction for or on account of any
present or future tax, duty or charge of whatever nature imposed or
levied by or on behalf of the United Kingdom, or any authority
thereof or therein having power to tax unless the withholding or
deduction is required by law.
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In that event, the Issuer shall pay such additional amounts as will
result (after such withholding or deduction) in the receipt by the
Relevant Account Holders of the sums which would have been receivable
(in the absence of such withholding or deduction) from the Issuer in
respect of their Underlying Notes; except that no such additional
amounts shall be payable with respect to any Underlying Note to or to
the order of a person liable to such tax, duty or charge in respect
of such Underlying Note by reason of his having some connection with
the United Kingdom other than the mere holding or ownership of such
Underlying Note or with respect to any Underlying Note presented for
payment to a paying agent which is required to deduct or withhold an
amount for or on account of such tax, duty or charge if such amount
can be paid without any deduction or withholding for or on account of
any tax, duty or charge by any other paying agent.
(d) Where the Issuer is Ciba Specialty Chemicals Eurofinance Ltd.:
All payments by the Issuer in respect of the Underlying Notes shall
be made without withholding or deduction for or on account of any
present or future tax, duty or charge of whatever nature imposed or
levied by or on behalf of Bermuda, or any authority thereof or
therein having power to tax unless the withholding or deduction is
required by law. In that event, the Issuer shall pay such additional
amounts as will result (after such withholding or deduction) in the
receipt by the Relevant Account Holders of the sums which would have
been receivable (in the absence of such withholding or deduction)
from the Issuer in respect of their Underlying Notes; except that no
such additional amounts shall be payable with respect to any
Underlying Note to or to the order of any person liable to such tax,
duty or charge in respect of such underlying Note by reason of his
having some connection with Bermuda other than the mere holding or
ownership of such Underlying Note.
5. Each Issuer hereby warrants, represents and covenants with each
Relevant Account Holder that it has all corporate power, and has
taken all necessary corporate or other steps, to enable it to
execute, deliver and perform this Deed, and that this Deed
constitutes a legal, valid and binding obligation of the relevant
Issuer enforceable in accordance with its terms subject to the laws
of bankruptcy and other laws affecting the rights of creditors
generally.
6. This Deed shall take effect as a Deed Poll for the benefit of the
Relevant Account Holders from time to time and for the time being.
This Deed shall be deposited with and held by a depository for
Clearstream, Luxembourg and Euroclear, or any successor to the
business thereof and for the time being (being at the date hereof
JPMorgan Chase Bank at Xxxxxxx Xxxxx, 0 Xxxxxx Xxxx Xxxxxx, Xxxxxx X0
0XX) until all the obligations of each Issuer hereunder have been
discharged in full.
7. Each Issuer hereby acknowledges the right of every Relevant Account
Holder to the production of, and the right of every Relevant Account
Holder to obtain (upon payment of a reasonable charge) a copy of,
this Deed, and further acknowledges and covenants that the
obligations binding upon it contained herein are owed to, and shall
be for the account of, each and every Relevant Account Holder, and
that each Relevant Account Holder shall be entitled severally to
enforce the said obligations against the relevant Issuer.
8. No rights are conferred on any person under the Contracts (Rights of
Third Parties) Xxx 0000 to enforce any term of this Deed, but this
does not affect any right or remedy of any person which exists or is
available apart from that Act.
9. This Deed is governed by, and shall be construed in accordance with,
the laws of England.
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Each Issuer hereby irrevocably agrees, for the exclusive benefit of
the Relevant Account Holders, that the courts of England are to have
jurisdiction to settle any dispute which may arise out of, or in
connection with, this Deed and that accordingly any suit, action or
proceedings (together referred to as "PROCEEDINGS") arising out of,
or in connection with, this Deed may be brought in such courts. Each
Issuer irrevocably waives any objection which it may have now or
hereafter to the laying of the venue of any Proceedings in any such
court and any claim that any such Proceedings have been brought in an
inconvenient forum and further irrevocably agrees that a judgment in
any Proceedings brought in the English courts shall be conclusive and
binding upon the relevant Issuer and may be enforced in the courts of
any other jurisdiction (subject to the laws of the jurisdiction in
which enforcement is sought). Nothing contained in this Clause shall
limit any right to take Proceedings against any Issuer in any other
court of competent jurisdiction, nor shall the taking of Proceedings
in one or more jurisdictions preclude the taking of Proceedings in
any other jurisdiction, whether concurrently or not (subject to the
laws of the relevant jurisdictions). Ciba Specialty Chemicals
Corporation, Ciba Spezialitatenchemie Holding Deutschland GmbH and
Ciba Specialty Chemicals Eurofinance Ltd. each hereby appoints Ciba
Specialty Chemicals PLC at its registered office for the time being
to accept service of process on its behalf. If Ciba Specialty
Chemicals PLC shall cease to be registered under the laws of England
and Wales, the relevant Issuer shall appoint another person with an
office in London to accept such service. Nothing herein shall affect
the right to serve process in any other manner permitted by law.
10. This Deed may be executed by any one or more of the parties hereto in
any number of counterparts, each of which shall be deemed to be an
original, but all such counterparts shall together constitute one and
the same instrument.
IN WITNESS whereof each Issuer has caused this Deed to be duly executed the
day and year first above mentioned.
EXECUTED as a Deed by CIBA )
SPECIALTY CHEMICALS )
CORPORATION )
acting by ) XXXXXX XXXXX XXXX XXXXXXXX
and )
acting under the authority of that company )
in the presence of: )
Witness's X. XXXXXXX
Signature----------------------------------------
X. XXXXXXX
Name ----------------------------------------
C/o CIBA SPECIALTY CHEMICALS INC.
Address ----------------------------------------
XX-0000 XXXXX
----------------------------------------
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EXECUTED as a Deed by CIBA )
SPECIALTY CHEMICALS )
PLC )
acting by its attorney(s) ) XXXXXX XXXXX XXXX XXXXXXXX
)
in the presence of: )
Witness's X. XXXXXXX
Signature----------------------------------------
X. XXXXXXX
Name ----------------------------------------
C/o CIBA SPECIALTY CHEMICALS INC.
Address ----------------------------------------
XX-0000 XXXXX
----------------------------------------
EXECUTED as a Deed by CIBA )
SPEZIALITATENCHEMIE )
HOLDING DEUTSCHLAND GMBH )
acting by ) XXXXXX XXXXX XXXX XXXXXXXX
and )
acting under the authority of that company )
in the presence of: )
Witness's X. XXXXXXX
Signature----------------------------------------
X. XXXXXXX
Name ----------------------------------------
C/o CIBA SPECIALTY CHEMICALS INC.
Address ----------------------------------------
XX-0000 XXXXX
----------------------------------------
EXECUTED as a Deed under )
Seal by CIBA SPECIALTY CHEMICALS )
EUROFINANCE LTD. )
and SIGNED and DELIVERED as )
a deed on its behalf by )
) XXXXXX XXXXX XXXX XXXXXXXX
in the presence of: )
Witness's X. XXXXXXX
Signature----------------------------------------
X. XXXXXXX
Name ----------------------------------------
C/o CIBA SPECIALTY CHEMICALS INC.
Address ----------------------------------------
XX-0000 XXXXX
----------------------------------------
CONFORMED COPY
27TH MARCH, 2002
CIBA SPECIALTY CHEMICALS PLC
CIBA SPECIALTY CHEMICALS CORPORATION
CIBA SPEZIALITATENCHEMIE HOLDING DEUTSCHLAND GMBH
CIBA SPECIALTY CHEMICALS EUROFINANCE LTD.
AS ISSUERS
---------------------------------------------
DEED OF COVENANT
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[XXXXX & OVERY LOGO]
London
