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EXECUTION COPY
EXHIBIT 4.6
PPL CORPORATION
and
THE BANK OF NEW YORK, as Collateral Agent,
Securities Intermediary and Custodial Agent
and
THE CHASE MANHATTAN BANK, as Purchase Contract Agent
PLEDGE AGREEMENT
Dated as of May 9, 2001
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TABLE OF CONTENTS
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Section 1. Definitions...............................................................2
Section 2. Pledge....................................................................6
Section 2.1 Pledge...........................................................6
Section 2.2 Control; Financing Statement.....................................6
Section 2.3 Termination......................................................6
Section 3. Distributions on Pledged Collateral.......................................7
Section 3.1 Income Distributions.............................................7
Section 3.2 Principal Payments Following Termination Event...................7
Section 3.3 Principal Payments Prior To or On Purchase Contract Settlement
Date.............................................................7
Section 3.4 Payments to Purchase Contract Agent..............................8
Section 3.5 Assets Not Properly Released.....................................8
Section 4. Control...................................................................8
Section 4.1 Establishment of Collateral Account..............................8
Section 4.2 Treatment as Financial Assets....................................9
Section 4.3 Sole Control by Collateral Agent.................................9
Section 4.4 Securities Intermediary's Location...............................9
Section 4.5 No Other Claims..................................................9
Section 4.6 Investment and Release..........................................10
Section 4.7 Statements and Confirmations....................................10
Section 4.8 Tax Allocations.................................................10
Section 4.9 No Other Agreements.............................................10
Section 4.10 Powers Coupled With An Interest.................................10
Section 4.11 Wire Transfer Instructions......................................11
Section 5. Initial Deposit; Establishment of Treasury PEPS Units and Re-establishment
of PEPS Units............................................................11
Section 5.1 Initial Deposit of Trust Preferred Securities...................11
Section 5.2 Establishment of Treasury PEPS Units............................11
Section 5.3 Reestablishment of PEPS Units...................................13
Section 5.4 Termination Event...............................................14
Section 5.5 Cash Settlement.................................................16
Section 5.6 Early Settlement................................................17
Section 5.7 Application of Proceeds in Settlement of Purchase Contracts.....18
Section 5.8 Tax Event Redemption............................................20
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Section 6. Voting Rights - Pledged Preferred Securities and Pledged Subordinated
Notes....................................................................21
Section 7. Rights and Remedies......................................................22
Section 7.1 Rights and Remedies of the Collateral Agent.....................22
Section 7.2 Substitution of Subordinated Notes..............................23
Section 7.3 Tax Event Redemption............................................23
Section 7.4 Initial and Additional Remarketing; Treasury Portfolio Cash
Payment to Remarketing Agent or Its Designated Entity...........24
Section 7.5 Substitutions...................................................25
Section 8. Representations and Warranties; Covenants................................25
Section 8.1 Representations and Warranties..................................25
Section 8.2 Covenants.......................................................26
Section 9. The Collateral Agent, the Securities Intermediary and the Custodial
Agent....................................................................27
Section 9.1 Appointment, Powers and Immunities..............................27
Section 9.2 Instructions of the Company.....................................28
Section 9.3 Reliance by Collateral Agent, Securities Intermediary and Custodial
Agent...........................................................28
Section 9.4 Rights in Other Capacities......................................29
Section 9.5 Non-Reliance on Collateral Agent, Securities Intermediary and
Custodial Agent.................................................29
Section 9.6 Compensation and Indemnity......................................29
Section 9.7 Failure to Act..................................................30
Section 9.8 Resignation of Collateral Agent, Securities Intermediary and
Custodial Agent.................................................31
Section 9.9 Right to Appoint Agent or Advisor...............................32
Section 9.10 Survival........................................................32
Section 9.11 Exculpation.....................................................32
Section 10. Amendment................................................................33
Section 10.1 Amendment Without Consent of Holders............................33
Section 10.2 Amendment With Consent of Holders...............................33
Section 10.3 Execution of Amendments.........................................34
Section 10.4 Effect of Amendments............................................34
Section 10.5 Reference to Amendments.........................................34
Section 11. Miscellaneous............................................................35
Section 11.1 No Waiver.......................................................35
Section 11.2 Governing Law...................................................35
Section 11.3 Notices.........................................................35
Section 11.4 Successors and Assigns..........................................36
Section 11.5 Counterparts....................................................36
Section 11.6 Severability....................................................36
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Section 11.7 Expenses, Etc...................................................36
Section 11.8 Security Interest Absolute......................................37
Section 11.9 Notice of Tax Event, Tax Event Redemption and Termination Event.37
Section 11.10Book-entry Interests............................................38
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EXHIBIT A INSTRUCTION FROM PURCHASE CONTRACT AGENT TO
COLLATERAL AGENT (Establishment of Treasury PEPS Units)...............A-1
EXHIBIT B INSTRUCTION FROM COLLATERAL AGENT TO SECURITIES
INTERMEDIARY (Establishment of Treasury PEPS Units)...................B-1
EXHIBIT C INSTRUCTION FROM PURCHASE CONTRACT AGENT TO
COLLATERAL AGENT (Reestablishment of PEPS Units ).....................C-1
EXHIBIT D INSTRUCTION FROM COLLATERAL AGENT TO SECURITIES
INTERMEDIARY (Reestablishment of PEPS Units)..........................D-1
EXHIBIT E NOTICE OF CASH SETTLEMENT FROM SECURITIES
INTERMEDIARY TO PURCHASE CONTRACT AGENT (Cash
Settlement Amounts)...................................................E-1
EXHIBIT F INSTRUCTION TO CUSTODIAL AGENT REGARDING
REMARKETING...........................................................F-1
EXHIBIT G INSTRUCTION TO CUSTODIAL AGENT REGARDING
WITHDRAWAL FROM REMARKETING...........................................G-1
EXHIBIT H NOTICE TO MAKE TREASURY PORTFOLIO CASH PAYMENT........................H-1
EXHIBIT I INSTRUCTION TO PURCHASE CONTRACT AGENT................................I-1
EXHIBIT J INSTRUCTION FROM PURCHASE CONTRACT AGENT TO
COLLATERAL AGENT......................................................H-1
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PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of May 9, 2001, among PPL Corporation, a
Pennsylvania corporation (the "COMPANY"), The Bank of New York, a New York
banking corporation, as collateral agent (in such capacity, together with its
successors in such capacity, the "COLLATERAL AGENT"), as securities intermediary
with respect to the Collateral Account (as defined below) (in such capacity,
together with its successors in such capacity, the "SECURITIES INTERMEDIARY"),
and as custodial agent for the Company (in such capacity, together with its
successors in such capacity, the "CUSTODIAL AGENT") and The Chase Manhattan
Bank, as purchase contract agent and as attorney-in-fact of the Holders from
time to time of the Securities under the Purchase Contract Agreement (in such
capacity, together with its successors in such capacity, the "PURCHASE CONTRACT
AGENT").
RECITALS
The Company and the Purchase Contract Agent are parties to the Purchase
Contract Agreement dated as of the date hereof (as modified and supplemented and
in effect from time to time, the "PURCHASE CONTRACT AGREEMENT"), pursuant to
which there may be issued up to $575,000,000 Premium Equity Participating
Security Units--PEPS(SM) Units (including any Treasury PEPS Units (as referred
to below), the "SECURITIES") (including $75,000,000 Securities relating to the
over-allotment option granted to the underwriters pursuant to the Underwriting
Agreement).
Each Security, at issuance, consists of a unit comprised of (a) a stock
purchase contract (the "PURCHASE CONTRACT") under which the Holder will purchase
from the Company on May 18, 2004 (the "PURCHASE CONTRACT SETTLEMENT DATE"), for
an amount equal to $25 (the "STATED AMOUNT"), a number of shares of PPL
Corporation common stock, par value $0.01 per share ("COMMON STOCK"), equal to
the Settlement Rate, and (b) a Trust Preferred Security (a "PREFERRED SECURITY")
issued by PPL Capital Funding Trust I (the "TRUST"), having a stated liquidation
amount equal to the Stated Amount and maturing on May 18, 2006, representing an
undivided beneficial ownership interest in the assets of the Trust and
guaranteed by the Company.
Pursuant to the terms of the Purchase Contract Agreement and the
Purchase Contracts, the Holders of the Securities have irrevocably authorized
the Purchase Contract Agent, as attorney-in-fact of such Holders to, among other
things, execute and deliver this Agreement on behalf of such Holders and grant
the pledge provided herein of the Collateral Account to secure the Obligations
(as defined below).
Accordingly, the Company, the Collateral Agent, the Securities
Intermediary, the Custodial Agent and the Purchase Contract Agent, on its own
behalf and as attorney-in-fact of the Holders from time to time of the
Securities, agree as follows:
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SECTION 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 Section 1 have the meanings assigned to
them in this Section 1 and include the plural as well as the singular;
(b) the words "HEREIN," "HEREOF" and "HEREUNDER" and other words of
similar import refer to this Agreement as a whole and not to any particular
Section, Exhibit or other subdivision;
(c) the following terms which are defined in the UCC shall have the
meanings set forth therein: "CERTIFICATED SECURITY," "CONTROL," "FINANCIAL
ASSET," "ENTITLEMENT ORDER," "SECURITIES ACCOUNT" and "SECURITY ENTITLEMENT";
(d) the following terms have the meanings assigned to them in the
Purchase Contract Agreement: "ACT," "APPLICABLE OWNERSHIP INTEREST," "BANKRUPTCY
CODE," "BENEFICIAL OWNER," "BUSINESS DAY," "CASH SETTLEMENT," "CERTIFICATE,"
"CODE," "DEPOSITARY," "EARLY SETTLEMENT," "EARLY SETTLEMENT AMOUNT," "EARLY
SETTLEMENT DATE," "FAILED INITIAL REMARKETING," "FAILED FINAL REMARKETING,"
"FINAL REMARKETING DATE," "HOLDER," "INDENTURE TRUSTEE" "INITIAL REMARKETING
DATE," "OFFICERS' CERTIFICATE," "OPINION OF COUNSEL," "OUTSTANDING SECURITIES,"
"PEPS UNIT," "PERSON," "PURCHASE CONTRACT," "PURCHASE CONTRACT SETTLEMENT DATE,"
"PURCHASE PRICE," "QUOTATION AGENT," "REDEMPTION AMOUNT," "REMARKETING AGENT,"
"REMARKETING AGREEMENT," "REMARKETING FEE," "SETTLEMENT RATE," "SUBORDINATED
NOTES," "SUCCESSFUL INITIAL REMARKETING," "SUPPLEMENTAL REMARKETING AGREEMENT,"
"TAX EVENT REDEMPTION AMOUNT," "TERMINATION EVENT," "TREASURY PEPS UNIT,"
"TREASURY PORTFOLIO," "TREASURY PORTFOLIO PURCHASE PRICE," and "UNDERWRITING
AGREEMENT";
(e) the following terms have the meanings assigned to them in the
Amended and Restated Trust Agreement of PPL Capital Funding Trust I, of even
date herewith: "PROPERTY TRUSTEE," "REDEMPTION PRICE," "TAX EVENT," "TAX EVENT
REDEMPTION," and "TAX EVENT REDEMPTION DATE"; and
(f) the following terms have the meanings given to them in this Section
1(f):
"AGREEMENT" means this Pledge Agreement, as the same may be amended,
modified or supplemented from time to time by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"CASH" means any coin or currency of the United States as at the time
shall be legal tender for payment of public and private debts.
"COLLATERAL ACCOUNT" means the collective reference to:
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(1) the securities account of The Bank of New York, as
Collateral Agent, maintained by the Securities Intermediary and
designated "The Bank of New York, as Collateral Agent of PPL
Corporation, as pledgee of The Chase Manhattan Bank, as the Purchase
Contract Agent on behalf of and as attorney-in-fact for the Holders";
(2) all investment property and other financial assets from time
to time credited to the Collateral Account, including, without
limitation, (A) the Preferred Securities and security entitlements
relating thereto which are a component of the PEPS Units from time to
time, (B) the Applicable Ownership Interests (as specified in Clause (A)
of the definition of such term) of the Holders with respect to the
Treasury Portfolio which are a component of the PEPS Units from time to
time and any interest accruing thereon; (C) the Subordinated Notes and
security entitlements relating thereto which are a component of the PEPS
Units from time to time, (D) any Treasury Securities and security
entitlements relating thereto delivered from time to time upon
establishment of Treasury PEPS Units in accordance with Section 5.2
hereof and (E) payments made by Holders pursuant to Section 5.5 hereof;
(3) all Proceeds of any of the foregoing (whether such Proceeds
arise before or after the commencement of any proceeding under any
applicable bankruptcy, insolvency or other similar law, by or against
the pledgor or with respect to the pledgor); and
(4) all powers and rights now owned or hereafter acquired under
or with respect to the Collateral Account
((2), (3) and (4), being collectively referred to as the "COLLATERAL").
"COMPANY" means the Person named as the "COMPANY" in the first
paragraph of this instrument until a successor shall have become such,
and thereafter "COMPANY" shall mean such successor.
"OBLIGATIONS" means, with respect to each Holder, the collective
reference to all obligations and liabilities of such Holder under such
Holder's Purchase Contract, the Purchase Contract Agreement, and this
Agreement or any other document made, delivered or given in connection
herewith or therewith, in each case whether on account of principal,
interest (including, without limitation, interest accruing before and
after the filing of any petition in bankruptcy, or the commencement of
any insolvency, reorganization or like proceeding, relating to such
Holder, whether or not a claim for post-filing or post-petition interest
is allowed in such proceeding), fees, indemnities, costs, expenses or
otherwise (including, without limitation, all fees and disbursements of
counsel to the Company or the Collateral Agent or the Securities
Intermediary or the Custodial Agent that are required to be paid by the
Holder pursuant to the terms of any of the foregoing agreements).
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"PERMITTED INVESTMENTS" means any one or more of the following
which shall mature not later than the next succeeding Business Day:
(1) any evidence of indebtedness with an original maturity of 365
days or less issued, or directly and fully guaranteed or insured, by the
United States of America or any agency or instrumentality thereof
(provided that the full faith and credit of the United States of America
is pledged in support of the timely payment thereof or such indebtedness
constitutes a general obligation of it);
(2) deposits, certificates of deposit or acceptances with an
original maturity of 365 days or less of any institution which is a
member of the Federal Reserve System having combined capital and surplus
and undivided profits of not less than $200.0 million at the time of
deposit (and which may include the Collateral Agent);
(3) investments with an original maturity of 365 days or less of
any Person that is fully and unconditionally guaranteed by a bank
referred to in clause (2);
(4) repurchase agreements and reverse repurchase agreements
relating to marketable direct obligations issued or unconditionally
guaranteed by the United States Government or issued by any agency
thereof and backed as to timely payment by the full faith and credit of
the United States Government;
(5) investments in commercial paper, other than commercial paper
issued by the Company or its affiliates, of any corporation incorporated
under the laws of the United States or any State thereof, which
commercial paper has a rating at the time of purchase at least equal to
"A-1" by Standard & Poor's Ratings Services ("S&P") or at least equal to
"P-1" by Xxxxx'x Investors Service, Inc. ("MOODY'S"); and
(6) investments in money market funds (including, but not limited
to, money market funds managed by the Collateral Agent or an affiliate
of the Collateral Agent) registered under the Investment Company Act of
1940, as amended, rated in the highest applicable rating category by S&P
or Moody's.
"PLEDGE" means the lien and security interest created by this
Agreement.
"PLEDGED PREFERRED SECURITIES" means the Preferred Securities and
security entitlements with respect thereto from time to time credited to
the Collateral Account and not then released from the Pledge.
"PLEDGED SUBORDINATED NOTES" means Subordinated Notes and
security entitlements with respect thereto from time to time credited to
the Collateral Account and not then released from the Pledge.
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"PLEDGED TREASURY SECURITIES" means Treasury Securities and
security entitlements with respect thereto from time to time credited to
the Collateral Account and not then released from the Pledge.
"PROCEEDS" has the meaning ascribed thereto in the UCC and
includes, without limitation, all interest, dividends, cash,
instruments, securities, financial assets (as defined in Section
8-102(a)(9) of the UCC) and other property received, receivable or
otherwise distributed upon the sale, exchange, collection or disposition
of any financial assets from time to time held in the Collateral
Account.
"PURCHASE CONTRACT AGENT" has the meaning specified in the
paragraph preceding the recitals of this Agreement.
"SEPARATE SECURITIES" means any Preferred Securities that are not
Pledged Preferred Securities or any Subordinated Notes that are not
Pledged Subordinated Notes, as the case may be.
"TRADES" means the Treasury/Reserve Automated Debt Entry System
maintained by the Federal Reserve Bank of New York pursuant to the
TRADES Regulations.
"TRADES REGULATIONS" means the regulations of the United States
Department of the Treasury, published at 31 C.F.R. Part 357, as amended
from time to time. Unless otherwise defined herein, all terms defined in
the TRADES Regulations are used herein as therein defined.
"TRANSFER" means in the case of certificated securities in
registered form, delivery as provided in Section 8-301(a) of the UCC,
indorsed to the transferee or in blank by an effective endorsement; in
the case of Treasury Securities, registration of the transferee as the
owner of such Treasury Securities on TRADES; and in the case of security
entitlements, including, without limitation, security entitlements with
respect to Treasury Securities, a securities intermediary indicating by
book entry that such security entitlement has been credited to the
transferee's securities account.
"TREASURY PORTFOLIO CASH PAYMENT" shall have the meaning set
forth in Section 7.4.
"TREASURY SECURITIES" means zero-coupon U.S. treasury securities
(Cusip No. 000000XX0) that mature on May 17, 2004.
"UCC" means the Uniform Commercial Code as in effect in the State
of New York from time to time.
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"VALUE" means, with respect to any item of Collateral on any
date, as to (1) Cash, the face amount thereof and (2) Treasury
Securities or Pledged Treasury Securities, the aggregate principal
amount thereof due at maturity and (3) the Preferred Securities or
Pledged Preferred Securities, the stated liquidation amount thereof and
(4) Subordinated Notes or Pledged Subordinated Notes, the aggregate
principal amount thereof due at maturity.
SECTION 2. PLEDGE.
SECTION 2.1 PLEDGE.
Each Holder, acting through the Purchase Contract Agent as such Holder's
attorney-in-fact, hereby pledges and grants to the Collateral Agent, as agent of
and for the benefit of the Company, a continuing first priority security
interest in and to, and a lien upon and right of set-off against, all of such
Holder's right, title and interest in and to the Collateral Account to secure
the prompt and complete payment and performance when due (whether at stated
maturity, by acceleration or otherwise) of the Obligations. The Collateral Agent
shall have all of the rights, remedies and recourses with respect to the
Collateral afforded a secured party by the UCC, in addition to, and not in
limitation of, the other rights, remedies and recourses afforded to the
Collateral Agent by this Agreement.
SECTION 2.2 CONTROL; FINANCING STATEMENT.
(a) The Collateral Agent shall have control of the Collateral Account
pursuant to the provisions of Section 4 of this Agreement.
(b) As soon as practicable after the date of initial issuance of the
Securities, the Company shall deliver to the Collateral Agent a financing
statement under the UCC which was prepared for filing by the Company in the
Office of the Secretary of State of the State of New York and any other
jurisdictions which the Company deems necessary, signed by the Purchase Contract
Agent, as attorney-in-fact for the Holders, as Debtors, and describing the
Collateral, together with evidence of the filing thereof and of the filing
information of the filing officer of each office in which so filed.
SECTION 2.3 TERMINATION.
As to each Holder, this Agreement and the Pledge created hereby shall
terminate upon the satisfaction of such Holder's Obligations. Upon such
termination, the Securities Intermediary shall Transfer such Holder's portion of
the Collateral to the Purchase Contract Agent for distribution to such Holder in
accordance with his interest, free and clear of any lien, pledge or security
interest created hereby.
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SECTION 3. DISTRIBUTIONS ON PLEDGED COLLATERAL.
SECTION 3.1 INCOME DISTRIBUTIONS.
All income distributions received by the Securities Intermediary on
account of the Preferred Securities, the Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio, the Subordinated Notes or Permitted Investments from time to time
held in the Collateral Account shall be distributed to the Purchase Contract
Agent (The Chase Manhattan Bank, ABA No. 000000000, DDA No. 507947533, FFC A/C
No. 160268.1, Re: PPL Corporation PEPS Units) for the benefit of the applicable
Holders as provided in the Purchase Contracts or Purchase Contract Agreement.
SECTION 3.2 PRINCIPAL PAYMENTS FOLLOWING TERMINATION EVENT.
All payments received by the Securities Intermediary following a
Termination Event of (1) the liquidation amount of Pledged Preferred Securities
or securities entitlements thereto, or (2) the Applicable Ownership Interests
(as specified in Clause (A) of the definition thereof) of the Treasury
Portfolio, (3) the aggregate principal amount of the Pledged Subordinated Notes
or securities entitlements thereto, or (4) the principal amount of the Pledged
Treasury Securities or security entitlements with respect thereto, shall be
distributed to the Purchase Contract Agent for the benefit of the applicable
Holders for distribution to such Holders in accordance with their respective
interests.
SECTION 3.3 PRINCIPAL PAYMENTS PRIOR TO OR ON PURCHASE CONTRACT
SETTLEMENT DATE.
(a) Subject to the provisions of Section 7.2, and except as provided in
clause 3.3(b) below, if no Termination Event shall have occurred, all payments
received by the Securities Intermediary of (1) the liquidation amount with
respect to the Pledged Preferred Securities or security entitlements with
respect thereto, (2) the Applicable Ownership Interests (as specified in Clause
(A) of the definition thereof) of the Treasury Portfolio, (3) the aggregate
principal amount with respect to the Pledged Subordinated Notes or security
entitlements with respect thereto or (4) the principal amount of Pledged
Treasury Securities or security entitlements with respect thereto, shall be held
and invested in Permitted Investments until the Purchase Contract Settlement
Date and on the Purchase Contract Settlement Date distributed to the Company as
provided in Section 5.7 hereof. Any balance remaining in the Collateral Account
shall be distributed to the Purchase Contract Agent for the benefit of the
applicable Holders for distribution to such Holders in accordance with their
respective interests. Upon the request of the Securities Intermediary, the
Company shall instruct the Securities Intermediary as to the type of Permitted
Investments in which any payments made under this Section shall be invested,
provided, however, that if the Company fails to deliver such instructions by
10:30 a.m. (New York City time), the Securities Intermediary shall invest such
payments in the Permitted Investments described in clause 6 of the definition of
Permitted Investments.
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(b) All payments received by the Securities Intermediary of (1) the
liquidation amount of Preferred Securities or security entitlements with respect
thereto, (2) the Applicable Ownership interests (as specified in Clause (A) of
the definition thereof) of the Treasury Portfolio, (3) the aggregate principal
amount with respect to the Subordinated Notes or security entitlements with
respect thereto or (4) the principal amount of Treasury Securities or security
entitlements with respect thereto, that, in each case, have been released from
the Pledge shall be distributed to the Purchase Contract Agent for the benefit
of the applicable Holders for distribution to such Holders in accordance with
their respective interests.
SECTION 3.4 PAYMENTS TO PURCHASE CONTRACT AGENT.
The Securities Intermediary shall use all commercially reasonable
efforts to deliver payments to the Purchase Contract Agent hereunder to the
account designated by the Purchase Contract Agent for such purpose not later
than the close of business on the Business Day such payment is received by the
Securities Intermediary; provided, however, that if such payment is received on
a day that is not a Business Day or after 11:00 A.M. (New York City time) on a
Business Day, then the Securities Intermediary shall use all commercially
reasonable efforts to deliver such payment no later than 10:30 a.m. (New York
City time) on the next succeeding Business Day.
SECTION 3.5 ASSETS NOT PROPERLY RELEASED.
If the Purchase Contract Agent or any Holder shall receive any principal
payments on account of financial assets credited to the Collateral Account and
not released therefrom in accordance with this Agreement, the Purchase Contract
Agent or such Holder shall hold the same as trustee of an express trust for the
benefit of the Company and, upon receipt of an Officers' Certificate of the
Company so directing, promptly deliver the same to the Securities Intermediary
for credit to the Collateral Account or to the Company for application to the
Obligations of the Holders, and the Purchase Contract Agent and Holders shall
acquire no right, title or interest in any such payments of principal amounts so
received.
SECTION 4. CONTROL.
SECTION 4.1 ESTABLISHMENT OF COLLATERAL ACCOUNT.
The Securities Intermediary hereby confirms that:
(1) the Securities Intermediary has established the Collateral
Account;
(2) the Collateral Account is a securities account;
(3) subject to the terms of this Agreement, the Securities
Intermediary shall treat the Purchase Contract Agent as entitled to
exercise the rights that comprise any financial asset credited to the
Collateral Account;
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(4) all property delivered to the Securities Intermediary
pursuant to this Agreement or the Purchase Contract Agreement will be
credited promptly to the Collateral Account;
(5) all securities or other property underlying any financial
assets credited to the Collateral Account shall be registered in the
name of the Securities Intermediary, indorsed to the Securities
Intermediary or in blank, or credited to another securities account
maintained in the name of the Securities Intermediary, and in no case
will any financial asset credited to the Collateral Account be
registered in the name of the Purchase Contract Agent or any Holder,
payable to the order of the Purchase Contract Agent or any Holder or
specially indorsed to the Purchase Contract Agent or any Holder.
SECTION 4.2 TREATMENT AS FINANCIAL ASSETS.
Each item of property (whether investment property, financial asset,
security, instrument or cash) credited to the Collateral Account shall be
treated as a financial asset.
SECTION 4.3 SOLE CONTROL BY COLLATERAL AGENT.
Except as provided in Section 6, at all times prior to the termination
of the Pledge, the Collateral Agent shall have sole control of the Collateral
Account, and the Securities Intermediary shall take instructions and directions
with respect to the Collateral Account solely from the Collateral Agent. If at
any time the Securities Intermediary shall receive an entitlement order issued
by the Collateral Agent and relating to the Collateral Account, the Securities
Intermediary shall comply with such entitlement order without further consent by
the Purchase Contract Agent or any Holder or any other Person. Until termination
of the Pledge, the Securities Intermediary will not comply with any entitlement
orders issued by the Purchase Contract Agent or any Holder.
SECTION 4.4 SECURITIES INTERMEDIARY'S LOCATION.
The Collateral Account, and the rights and obligations of the Securities
Intermediary, the Collateral Agent, the Purchase Contract Agent and the Holders
with respect thereto, shall be governed by the laws of the State of New York.
Regardless of any provision in any other agreement, for purposes of the UCC, New
York shall be deemed to be the Securities Intermediary's location.
SECTION 4.5 NO OTHER CLAIMS.
Except for the claims and interest of the Collateral Agent and of the
Purchase Contract Agent and the Holders in the Collateral Account, the
Securities Intermediary (without making any investigation) does not know of any
claim to, or interest in, the Collateral Account or in any financial asset
credited thereto. If any Person asserts any lien, encumbrance or adverse claim
(including any writ, garnishment, judgment, warrant of attachment, execution or
similar process) against the Collateral Account or in any
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financial asset carried therein, the Securities Intermediary will promptly
notify the Collateral Agent and the Purchase Contract Agent.
SECTION 4.6 INVESTMENT AND RELEASE.
All proceeds of financial assets from time to time deposited in the
Collateral Account shall be invested and reinvested as provided in this
Agreement. At all times prior to termination of the Pledge, no property shall be
released from the Collateral Account except in accordance with this Agreement or
upon written instructions of the Collateral Agent.
SECTION 4.7 STATEMENTS AND CONFIRMATIONS.
The Securities Intermediary will send copies of all statements,
confirmations and other correspondence concerning the Collateral Account and any
financial assets credited thereto to each of the Purchase Contract Agent and the
Collateral Agent, simultaneously, at their addresses for notices under this
Agreement.
SECTION 4.8 TAX ALLOCATIONS.
The Company shall report all items of income, gain, expense and loss
recognized in the Collateral Account, to the extent such reporting is required
by law, to the Internal Revenue Service and all state and local taxing
authorities under the names and taxpayer identification numbers of the Holders.
None of the Securities Intermediary, the Collateral Agent or the Custodial Agent
shall have any tax reporting duties hereunder.
SECTION 4.9 NO OTHER AGREEMENTS.
The Securities Intermediary has not entered into, and prior to the
termination of the Pledge will not enter into, any agreement with any other
Person relating to the Collateral Account or any financial assets credited
thereto, including, without limitation, any agreement to comply with entitlement
orders of any Person other than the Collateral Agent.
SECTION 4.10 POWERS COUPLED WITH AN INTEREST.
The rights and powers granted in this Section 4 to the Collateral Agent
have been granted in order to perfect its security interests in the Collateral
Account, are powers coupled with an interest and will be affected neither by the
bankruptcy of the Purchase Contract Agent or any Holder nor by the lapse of
time. The obligations of the Securities Intermediary under this Section 4 shall
continue in effect until the termination of the Pledge.
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SECTION 4.11 WIRE TRANSFER INSTRUCTIONS.
Any moneys transferred hereunder for deposit into the Collateral Account
shall be delivered by wire transfer in immediately available funds addressed as
follows: The Bank of New York, ABA No. 000000000; Corporate Trust Agency GLA
111565; Ref.: BNY as Collateral Agent for PPL Pledge; Account No.: 015715.
SECTION 5. INITIAL DEPOSIT; ESTABLISHMENT OF TREASURY PEPS UNITS AND
RE-ESTABLISHMENT OF PEPS UNITS.
SECTION 5.1 INITIAL DEPOSIT OF TRUST PREFERRED SECURITIES.
Prior to or concurrently with the execution and delivery of this
Agreement, the Purchase Contract Agent, on behalf of the initial Holders of the
PEPS Units, shall Transfer to the Securities Intermediary, for credit to the
Collateral Account, the Preferred Securities or security entitlements relating
thereto, and the Securities Intermediary shall indicate by book-entry that a
securities entitlement to such Preferred Securities has been credited to the
Collateral Account.
SECTION 5.2 ESTABLISHMENT OF TREASURY PEPS UNITS.
(a) So long as the Trust shall not have been dissolved and liquidated,
at any time on or prior to the fifth Business Day immediately preceding the
Purchase Contract Settlement Date, a Holder of PEPS Units shall have the right
to substitute Treasury Securities or security entitlements with respect thereto
for the Pledged Preferred Securities securing such Holder's obligations under
the Purchase Contract comprising a part of such Holder's PEPS Units in integral
multiples of 40 PEPS Units by:
(1) Transferring to the Securities Intermediary for credit to
the Collateral Account Treasury Securities or security entitlements with
respect thereto having a Value equal to the aggregate liquidation amount
of the Pledged Preferred Securities to be released accompanied by a
notice, substantially in the form of Exhibit C to the Purchase Contract
Agreement, and all applicable fees, whereupon the Purchase Contract
Agent shall deliver to the Collateral Agent a notice, substantially in
the form of Exhibit A hereto, (A) stating that such Holder has
Transferred Treasury Securities or security entitlements with respect
thereto to the Securities Intermediary for credit to the Collateral
Account, (B) stating the Value of the Treasury Securities or security
entitlements with respect thereto Transferred by or on behalf of such
Holder and (C) requesting that the Collateral Agent release from the
Pledge the Pledged Preferred Securities that are a component of such
PEPS Units; and
(2) delivering the related PEPS Units to the Purchase Contract
Agent.
Upon receipt of such notice and confirmation that Treasury Securities or
security entitlements with respect thereto have been credited to the Collateral
Account as
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described in such notice, the Collateral Agent shall instruct the Securities
Intermediary by a notice, substantially in the form of Exhibit B hereto, to
release such Pledged Preferred Securities from the Pledge by Transfer to the
Purchase Contract Agent for distribution to such Holder, free and clear of any
lien, pledge or security interest created hereby.
(b) If no Tax Event Redemption shall have occurred, but the
Trust shall have been dissolved and liquidated, and the Subordinated
Notes have become a component of the PEPS Units, at any time on or prior
to the fifth Business Day immediately preceding the Purchase Contract
Settlement Date, a Holder of PEPS Units shall have the right to
substitute Treasury Securities or security entitlements with respect
thereto for the Pledged Subordinated Notes comprising a part of such
Holder's PEPS Units in integral multiples of 40 PEPS Units by:
(1) Transferring to the Securities Intermediary for
credit to the Collateral Account Treasury Securities or security
entitlements with respect thereto having a Value equal to the
aggregate principal amount at maturity of Pledged Subordinated
Notes to be released accompanied by a notice, substantially in
the form of Exhibit C to the Purchase Contract Agreement, and
all applicable fees, whereupon the Purchase Contract Agent shall
deliver to the Collateral Agent a notice, substantially in the
form of Exhibit A hereto, (A) stating that such Holder has
Transferred Treasury Securities or security entitlements with
respect thereto to the Securities Intermediary for credit to the
Collateral Account, (B) stating the Value of the Treasury
Securities or securities entitlements with respect thereto
Transferred by or on behalf of such Holder and (C) requesting
that the Collateral Agent release from the Pledge the Pledged
Subordinated Notes that are a component of such PEPS Units; and
(2) delivering the related PEPS Units to the Purchase
Contract Agent.
Upon receipt of such notice and confirmation that Treasury Securities or
security entitlements with respect thereto have been credited to the Collateral
Account as described in such notice, the Collateral Agent shall instruct the
Securities Intermediary by a notice, substantially in the form of Exhibit B
hereto, to release such Pledged Subordinated Notes from the Pledge by Transfer
to the Purchase Contract Agent for distribution to such Holder free and clear of
any lien, pledge or security interest created hereby.
(c) Upon credit to the Collateral Account of Treasury Securities or
security entitlements with respect thereto delivered by a Holder of PEPS Units
and receipt of the related instruction from the Collateral Agent, the Securities
Intermediary shall release the Pledged Preferred Securities or the Pledged
Subordinated Notes, as the case may be, and shall promptly transfer the same to
the Purchase Contract Agent for distribution to such Holder, free and clear of
any lien, pledge or security interest created hereby.
(d) All Treasury Securities delivered under this Agreement for credit to
the Collateral Account shall be delivered addressed as follows: Treasuries, The
Bank of New
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York; ABA No.: 000000000; BK of NYC/Cust. Account No.: 015715; Contact: Xxxx X.
Xxxxxxxxx, (000) 000-0000.
SECTION 5.3 REESTABLISHMENT OF PEPS UNITS.
(a) So long as the Trust shall not have been dissolved and liquidated
and so long as the Treasury Portfolio has not replaced the Treasury Securities
as a component of the Treasury PEPS Units as a result of a Successful Initial
Remarketing or a Tax Event Redemption, at any time on or prior to the seventh
Business Day immediately preceding the Purchase Contract Settlement Date, a
Holder of Treasury PEPS Units shall have the right to reestablish PEPS Units by
substitution of Preferred Securities or security entitlements with respect
thereto, for Pledged Treasury Securities or security entitlements with respect
thereto in integral multiples of 40 Treasury PEPS Units by:
(1) Transferring to the Securities Intermediary for credit to
the Collateral Account Preferred Securities or security entitlements
with respect thereto having a liquidation amount equal to the Value of
the Pledged Treasury Securities to be released, accompanied by a notice,
substantially in the form of Exhibit C to the Purchase Contract
Agreement, and all applicable fees whereupon the Purchase Contract Agent
shall deliver to the Collateral Agent a notice, substantially in the
form of Exhibit C hereto, stating that such Holder has Transferred Trust
Preferred Securities or security entitlements with respect thereto, to
the Securities Intermediary for credit to the Collateral Account and
requesting that the Collateral Agent release from the Pledge the Pledged
Treasury Securities related to such Treasury PEPS Units; and
(2) Delivering the related Treasury PEPS Units to the Purchase
Contract Agent.
Upon receipt of such notice and confirmation that Preferred Securities
or security entitlements thereto have been credited to the Collateral Account as
described in such notice, the Collateral Agent shall instruct the Securities
Intermediary by a notice in the form provided in Exhibit D hereto to release
such Pledged Treasury Securities from the Pledge by Transfer to the Purchase
Contract Agent for distribution to such Holder, free and clear of any lien,
pledge or security interest created hereby.
(b) If no Tax Event Redemption shall have occurred, but the Trust shall
have been dissolved and liquidated, and the Subordinated Notes have become a
component of the PEPS Units, at any time on or prior to the seventh Business Day
immediately preceding the Purchase Contract Settlement Date, a Holder of
Treasury PEPS Units shall have the right to reestablish PEPS Units by
substitution of Subordinated Notes or security entitlements with respect thereto
for Pledged Treasury Securities in integral multiples of 40 Treasury PEPS Units
by:
(1) Transferring to the Securities Intermediary for credit to the
Collateral Account Subordinated Notes or security entitlements with
respect thereto having a
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principal amount equal to the Value of the Pledged Treasury Securities
to be released, accompanied by a notice, substantially in the form of
Exhibit C to the Purchase Contract Agreement, and all applicable fees
whereupon the Purchase Contract Agent shall deliver to the Collateral
Agent a notice, substantially in the form of Exhibit C hereto, stating
that such Holder has Transferred the Subordinated Notes or security
entitlements with respect thereto, to the Securities Intermediary for
credit to the Collateral Account and requesting that the Collateral
Agent release from the Pledge the Pledged Treasury Securities related to
such Treasury PEPS Units; and
(2) delivering the related Treasury PEPS Units to the Purchase
Contract Agent.
Upon receipt of such notice and confirmation that Subordinated Notes or
security entitlements with respect thereto have been credited to the Collateral
Account as described in such notice, the Collateral Agent shall instruct the
Securities Intermediary by a notice in the form provided in Exhibit D hereto to
release such Pledged Treasury Securities from Pledge by Transfer to the Purchase
Contract Agent for distribution to such Holder, free and clear of any lien,
pledge or security interest created hereby.
(c) Upon credit to the Collateral Account of Preferred Securities or
security entitlements with respect thereto or Subordinated Notes or security
entitlements with respect thereto, as the case may be, delivered by a Holder of
Treasury PEPS Units and receipt of the related instruction from the Collateral
Agent, the Securities Intermediary shall release the Pledged Treasury Securities
and shall promptly transfer the same to the Purchase Contract Agent for
distribution to such Holder, free and clear of any lien, pledge or security
interest created hereby.
SECTION 5.4 TERMINATION EVENT.
(a) Upon receipt by the Collateral Agent of written notice from the
Company or the Purchase Contract Agent that a Termination Event has occurred,
the Collateral Agent shall release all Collateral from the Pledge and shall
promptly Transfer:
(1) any Pledged Preferred Securities or security entitlements
with respect thereto or the Applicable Ownership Interest (as specified
in clause (A) of the definition of such term) of the Treasury Portfolio
(if a Tax Event Redemption or a Successful Initial Remarketing has
occurred and the Treasury Portfolio has become a component of the PEPS
Units) or the Pledged Subordinated Notes or security entitlements with
respect thereto (if the Trust has been dissolved and liquidated, and the
Subordinated Notes or security entitlements with respect thereto have
become a component of the PEPS Units);
(2) any Pledged Treasury Securities, and
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(3) payments by Holders (or the Permitted Investments of such
payments) pursuant to Section 5.5 hereof,
to the Purchase Contract Agent for the benefit of the Holders for distribution
to such Holders in accordance with their respective interests, free and clear of
any lien, pledge or security interest or other interest created hereby;
provided, however, if any Holder shall be entitled to receive less than $1,000
with respect to his interest in the Applicable Ownership Interest (as specified
in clause (A) of the definition of such term) of the Treasury Portfolio, the
Purchase Contract Agent shall have the right to dispose of such interest for
cash and deliver to such Holder cash in lieu of delivering the Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio.
(b) If such Termination Event shall result from the Company's becoming a
debtor under the Bankruptcy Code, and if the Collateral Agent shall for any
reason fail promptly to effectuate the release and Transfer of all Pledged
Preferred Securities, the Applicable Ownership Interest (as specified in clause
(A) of the definition of such term) of the Treasury Portfolio, the Pledged
Subordinated Notes, the Pledged Treasury Securities or payments by Holders (or
the Permitted Investments of such payments) pursuant to Section 5.5 hereof, as
the case may be, as provided by this Section 5.4, the Purchase Contract Agent
shall:
(1) use its commercially reasonable efforts to obtain an opinion
of a nationally recognized law firm reasonably acceptable to the
Collateral Agent to the effect that, as a result of the Company's being
the debtor in such a bankruptcy case, the Collateral Agent will not be
prohibited from releasing or Transferring the Collateral as provided in
this Section 5.4, and shall deliver such opinion to the Collateral Agent
within ten days after the occurrence of such Termination Event, and if
(A) the Purchase Contract Agent shall be unable to obtain such opinion
within ten days after the occurrence of such Termination Event or (B)
the Collateral Agent shall continue, after delivery of such opinion, to
refuse to effectuate the release and Transfer of all Preferred
Securities, Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio, all the Pledged
Subordinated Notes, the Pledged Treasury Securities, the payments by
Holders or the Permitted Investments of such payments pursuant to
Section 5.5 hereof or the Proceeds of any of the foregoing, as the case
may be, as provided in this Section 5.4, then the Purchase Contract
Agent shall within fifteen days after the occurrence of such Termination
Event commence an action or proceeding in the court having jurisdiction
of the Company's case under the Bankruptcy Code seeking an order
requiring the Collateral Agent to effectuate the release and transfer of
all Pledged Preferred Securities, Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio, all the Pledged Subordinated Notes, the Pledged Treasury
Securities, or the payments by Holders or the
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Permitted Investments of such payments pursuant to Section 5.5 hereof,
or as the case may be, as provided by this Section 5.4; or
(2) commence an action or proceeding like that described in
clause 5.4(b)(1) hereof within ten days after the occurrence of such
Termination Event.
SECTION 5.5 CASH SETTLEMENT.
(a) Upon receipt by the Collateral Agent of (1) (i) in the case of PEPS
Units, a notice from the Purchase Contract Agent promptly after the receipt by
the Purchase Contract Agent of a notice from a Holder of PEPS Units prior to or
at 11:00 a.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date that such Holder has elected, in
accordance with the procedures specified in Section 5.03(a)(i) of the Purchase
Contract Agreement to effect a Cash Settlement, or (ii) in the case of Treasury
PEPS Units, receipt of such notice on the second Business Day immediately
preceding the Purchase Contract Settlement Date that such Holder has elected, in
accordance with the procedures specified in Section 5.03(f)(i) of the Purchase
Contract Agreement to effect a Cash Settlement, and (2) payment by such Holder
by deposit in the Collateral Account prior to or at 11:00 a.m. (New York City
time) (i) in the case of PEPS Units, on the fourth Business Day immediately
preceding the Purchase Contract Settlement Date, or (ii) in the case of Treasury
PEPS Units, on the Business Day immediately preceding the Purchase Contract
Settlement Date, of the Purchase Price in lawful money of the United States by
wire transfer of immediately available funds payable to or upon the order of the
Securities Intermediary, then the Collateral Agent shall:
(1) instruct the Securities Intermediary promptly to invest any
such Cash in Permitted Investments;
(2) release from the Pledge the PEPS Unit holder's or the
Treasury PEPS Unit holder's related Pledged Preferred Securities, the
Pledged Subordinated Notes or Pledged Treasury Securities, as
applicable, as to which such Holder has elected to effect a Cash
Settlement pursuant to this Section 5.5(a); and
(3) instruct the Securities Intermediary to Transfer all such
Pledged Preferred Securities, Pledged Subordinated Notes or the Pledged
Treasury Securities, as the case may be, to the Purchase Contract Agent
for the benefit of such Holder, in each case free and clear of the
Pledge created hereby, for distribution to such Holder.
The Company shall instruct the Securities Intermediary as to the type of
Permitted Investments in which any such Cash shall be invested; provided,
however, that if the Company fails to deliver such instructions by 10:30 a.m.
(New York City time), the Securities Intermediary shall invest such Cash in the
Permitted Investments described in clause 6 of the definition of Permitted
Investments.
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Upon receipt of the proceeds upon the maturity of the Permitted
Investments on the Purchase Contract Settlement Date, the Collateral Agent shall
(A) instruct the Securities Intermediary to pay the portion of such proceeds, in
an aggregate amount equal to the Purchase Price, to the Company on the Purchase
Contract Settlement Date, and (B) instruct the Securities Intermediary to
release any amounts in excess of the Purchase Price earned from such Permitted
Investments to the Purchase Contract Agent for distribution to such Holder.
(b) If a Holder of PEPS Units (if neither a Tax Event Redemption nor a
Successful Initial Remarketing shall have occurred) notifies the Purchase
Contract Agent as provided in paragraph 5.03(a)(i) of the Purchase Contract
Agreement of its intention to pay the Purchase Price in cash, but fails to make
such payment as required by paragraph 5.03(a)(ii) of the Purchase Contract
Agreement, such Holder shall be deemed to have consented to the disposition of
such Holder's Pledged Preferred Securities or Pledged Subordinated Notes in
accordance with the remarketing procedures as described in paragraph
5.03(a)(iii) of the Purchase Contract Agreement.
(c) If a Holder of a Treasury PEPS Unit notifies the Purchase Contract
Agent as provided in paragraph 5.03(f)(i) of the Purchase Contract Agreement of
its intention to pay the Purchase Price in cash, but fails to make such payment
as required by paragraph 5.03(f)(ii) of the Purchase Contract Agreement, such
Holder shall be deemed to have elected to pay the Purchase Price in accordance
with paragraph 5.03(f)(iii) of the Purchase Contract Agreement.
(d) In the event of a Failed Final Remarketing as described in Section
5.02 of the Purchase Contract Agreement, the Collateral Agent, for the benefit
of the Company, will also exercise its rights as a secured party with respect to
such Pledged Preferred Securities at the direction of the Company to retain or
dispose of the Collateral in accordance with applicable law.
(e) As soon as practicable after 11:00 a.m. (New York City time) (i) in
the case of PEPS Units, on the fourth Business Day immediately preceding the
Purchase Contract Settlement Date, and (ii) in the case of Treasury PEPS Units,
on the Business Day immediately preceding the Purchase Contract Settlement Date,
the Securities Intermediary shall deliver to the Purchase Contract Agent a
notice, substantially in the form of Exhibit E hereto, stating the amount of
cash that it has received with respect to the Cash Settlement of PEPS Units or
the amount of cash that it has received with respect to the Cash Settlement of
Treasury PEPS Units, as the case may be.
SECTION 5.6 EARLY SETTLEMENT.
Upon receipt by the Collateral Agent of a notice from the Purchase
Contract Agent that a Holder of Securities has elected to effect Early
Settlement of its obligations under the Purchase Contracts forming a part of
such Securities in accordance with the terms of the Purchase Contracts and
Section 5.08 of the Purchase Contract Agreement (which notice shall set forth
the number of such Purchase Contracts as to which such
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Holder has elected to effect Early Settlement), and that the Purchase Contract
Agent has received from such Holder, and paid to the Company as confirmed in
writing by the Company, the related Early Settlement Amounts pursuant to the
terms of the Purchase Contracts and the Purchase Contract Agreement and that all
conditions to such Early Settlement have been satisfied, then the Collateral
Agent shall release from the Pledge, (1) Pledged Preferred Securities or the
appropriate Applicable Ownership Interest (as specified in clause (A) of the
definitions at such term) of the Treasury Portfolio or Pledged Subordinated
Notes in the case of a Holder of PEPS Units or (2) Pledged Treasury Securities,
in the case of a Holder of Treasury PEPS Units, with a Value equal to the
product of (x) the Stated Amount times (y) the number of Purchase Contracts as
to which such Holder has elected to effect Early Settlement, and shall instruct
the Securities Intermediary to Transfer all such Pledged Preferred Securities or
the appropriate Applicable Ownership Interest (as specified in clause (A) of the
definitions at such term) of the Treasury Portfolio or Pledged Subordinated
Notes or Pledged Treasury Securities, as the case may be, to the Purchase
Contract Agent for the benefit of such Holder, in each case free and clear of
the Pledge created hereby, for distribution to such Holder. A Treasury PEPS Unit
holder may settle early only in integral multiples of 40 Purchase Contracts.
SECTION 5.7 APPLICATION OF PROCEEDS IN SETTLEMENT OF PURCHASE
CONTRACTS.
(a) If a Holder of PEPS Units (if neither a Tax Event Redemption nor a
Successful Initial Remarketing has occurred) has not elected to make an
effective Cash Settlement by notifying the Purchase Contract Agent in the manner
provided for in Section 5.03(a)(i) in the Purchase Contract Agreement, such
Holder shall be deemed to have elected to pay for the shares of Common Stock to
be issued under such Purchase Contracts from the proceeds of the remarketing of
the related Pledged Preferred Securities or Pledged Subordinated Notes. Upon
notice of such event from the Purchase Contract Agent, the Collateral Agent
shall, by 11:00 a.m., New York City time, on the fourth Business Day immediately
preceding the Purchase Contract Settlement Date, without any instruction from
such Holder of PEPS Units, instruct the Securities Intermediary to Transfer the
related Pledged Preferred Securities or Pledged Subordinated Notes to the
Remarketing Agent for remarketing. Upon receiving such Pledged Preferred
Securities or the Pledged Subordinated Notes, the Remarketing Agent, pursuant to
the terms of the Remarketing Agreement and the Supplemental Remarketing
Agreement, will use reasonable efforts to remarket the Pledged Preferred
Securities or Pledged Subordinated Notes on the Final Remarketing Date at a
price of approximately 100.25% (but not less than 100%) of the aggregate Value
of such Pledged Preferred Securities or Pledged Subordinated Notes. After
deducting as the Remarketing Fee an amount not exceeding 25 basis points (.25%)
of the aggregate Value of the remarketed Pledged Preferred Securities or Pledged
Subordinated Notes from any amount of such proceeds in excess of the aggregate
Value of the remarketed Pledged Preferred Securities or Pledged Subordinated
Notes, the Remarketing Agent will remit the entire amount of the proceeds of
such remarketing to the Collateral Agent. On the Purchase Contract Settlement
Date, the Purchase Contract Agent shall give written direction to the
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Collateral Agent specifying the instruction the Collateral Agent shall give to
the Securities Intermediary in order to apply a portion of the Proceeds from
such remarketing equal to the aggregate liquidation amount of the Preferred
Securities or aggregate principal amount of such Pledged Subordinated Note to
satisfy in full such Holder's obligations to pay the Purchase Price to purchase
the shares of Common Stock under the related Purchase Contracts and the balance
of the Proceeds from the remarketing, if any, that shall be transferred to the
Purchase Contract Agent for the benefit of such Holder for distribution to such
Holder.
If the Remarketing Agent advises the Collateral Agent in writing that it
cannot remarket the related Pledged Preferred Securities or Pledged Subordinated
Notes of such Holders of PEPS Units at a price not less than 100% of the
aggregate Value of such Pledged Preferred Securities or Pledged Subordinated
Notes or if the remarketing shall not have occurred because a condition
precedent to the remarketing shall not have been fulfilled, thus resulting in a
Failed Final Remarketing, the Collateral Agent, for the benefit of the Company
shall, at the written direction of the Company, retain or dispose of the Pledged
Preferred Securities or Pledged Subordinated Notes in accordance with applicable
law and satisfy in full, from such retention or disposition, such Holder's
obligations to pay the Purchase Price for the shares of Common Stock.
(b) If a Holder of a Treasury PEPS Unit has not elected to make an
effective Cash Settlement by notifying the Purchase Contract Agent in the manner
provided for in Section 5.03(f)(i) of the Purchase Contract Agreement, or in all
cases where the Treasury Portfolio has become a component of PEPS Units or
Treasury PEPS Units such Holder shall be deemed to have elected to pay for the
shares of Common Stock to be issued under such Purchase Contracts from the
Proceeds of the related Pledged Treasury Securities or the Applicable Ownership
Interest (as specified in clause (A) of the definition of such term) of the
Treasury Portfolio, as the case may be. Promptly, after 11:00 a.m. (New York
City time) on the Business Day immediately prior to the Purchase Contract
Settlement Date, the Securities Intermediary shall invest the Cash Proceeds of
the maturing Pledged Treasury Securities or the Applicable Ownership Interest
(as specified in clause (A) of the definition of such term) of the Treasury
Portfolio, as the case may be, in Permitted Investments in clause 6 of the
definition of Permitted Investments, unless prior to 10:30 a.m. (New York City
time), the Company shall otherwise instruct the Securities Intermediary as to
the type of Permitted Investments in which any such Cash Proceeds shall be
invested. Without receiving any instruction from any such Holder, the Collateral
Agent shall apply the Proceeds of the related Pledged Treasury Securities or
such Applicable Ownership Interest (as specified in clause (A) of the definition
of such term) of the Treasury Portfolio, as the case may be, to the settlement
of such Purchase Contracts on the Purchase Contract Settlement Date. In the
event the sum of the Proceeds from the related Pledged Treasury Securities or
such Applicable Ownership Interest (as specified in clause (A) of the definition
of such term) of the Treasury Portfolio as the case may be, and the investment
earnings from the investment in Permitted Investments exceeds the aggregate
Purchase Price of the Purchase Contracts being settled thereby, the Collateral
Agent shall instruct the Securities
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Intermediary to distribute such excess, when received, to the Purchase Contract
Agent for the benefit of such Holder for distribution to such Holder.
(c) Pursuant to the Remarketing Agreement and subject to the terms of
the Supplemental Remarketing Agreement, on or prior to the fifth Business Day
immediately preceding February 18, 2004 or the Final Remarketing Date, as
applicable, or in the event of any Additional Remarketing, on or prior to the
second Business Day following the notification by the Remarketing Agent of its
intention to conduct an Additional Remarketing, but no earlier than the Payment
Date immediately preceding any such date, Holders of Separate Securities may
elect to have their Separate Securities remarketed by delivering their Separate
Securities, together with a notice of such election, substantially in the form
of Exhibit F hereto, to the Custodial Agent. The Custodial Agent shall hold such
Separate Securities in an account separate from the Collateral Account. A Holder
of Separate Securities electing to have its Separate Securities remarketed will
also have the right to withdraw such election by written notice to the Custodial
Agent, substantially in the form of Exhibit G hereto, on or prior to the second
Business Day immediately preceding the first Initial Remarketing taking place on
the third Business Day prior to February 18, 2004 or the Final Remarketing Date,
as applicable, upon receipt of which notice the Custodial Agent shall return
such Separate Securities to such Holder. On the Business Day immediately
preceding any Initial Remarketing Date or the Final Remarketing Date, as
applicable, the Custodial Agent shall notify the Remarketing Agent and the
Company of the aggregate liquidation amount, or the aggregate principal amount,
as the case may be, of the Separate Securities to be remarketed and will deliver
to the Remarketing Agent for remarketing all Separate Securities delivered to
the Custodial Agent pursuant to this Section 5.7(c) and not withdrawn pursuant
to the terms hereof prior to such date. After deducting the Remarketing Fee to
the extent permitted under the terms of the Remarketing Agreement, the
Remarketing Agent will remit to the Custodial Agent the remaining portion of the
proceeds for the benefit of such Holders. In the event of any Failed Initial
Remarketing or a Failed Final Remarketing, as applicable, the Remarketing Agent
will promptly return such Separate Securities to the Custodial Agent for
redelivery to such Holders.
(d) The Purchase Contract Agent, on behalf of itself and the Holders,
acknowledges and irrevocably agrees that any remarketing of the Preferred
Securities or Subordinated Notes on any Initial Remarketing Date or the Final
Remarketing Date shall not constitute a foreclosure of the Pledge of or other
exercise of default remedies with respect to the Preferred Securities or
Subordinated Notes within the meaning of the Code, but rather shall constitute a
voluntary sale of the Preferred Securities or Subordinated Notes by and on
behalf of the Holders and the Purchase Contract Agent.
SECTION 5.8 TAX EVENT REDEMPTION.
If the Securities Intermediary receives notice that a Tax Event
Redemption has occurred prior to the Purchase Contract Settlement Date, the
Securities Intermediary in accordance with Section 7.3 hereof shall apply the
Redemption Amount to purchase the
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Treasury Portfolio and the Securities Intermediary shall credit the Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio to the Collateral Account and shall transfer the
Applicable Ownership Interest (as specified in clause (B) of the definition of
such term) of the Treasury Portfolio to the Purchase Contract Agent for
distribution to the Holders of the PEPS Units. Upon credit to the Collateral
Account of the Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio having a Value equal to the
liquidation amount of the Pledged Preferred Securities or the aggregate
principal amount of the Pledged Subordinated Notes, the Securities Intermediary
shall release the Pledged Preferred Securities or the Pledged Subordinated
Notes, as applicable, from the Collateral Account and shall promptly transfer
the Pledged Preferred Securities to the Trust or the Pledged Subordinated Notes
to the Company, as applicable.
SECTION 6. VOTING RIGHTS - PLEDGED PREFERRED SECURITIES AND PLEDGED
SUBORDINATED NOTES.
The Purchase Contract Agent may exercise, or refrain from exercising,
any and all voting and other consensual rights pertaining to the Pledged
Preferred Securities or the Pledged Subordinated Notes or any part thereof for
any purpose not inconsistent with the terms of this Agreement and in accordance
with the terms of the Contract Agreement; provided, that the Purchase Contract
Agent shall not exercise or shall not refrain from exercising such right, as the
case may be, if, in the judgment of the Company, such action would impair or
otherwise have a material adverse effect on the value of all or any of the
Pledged Preferred Securities or the Pledged Subordinated Notes; and provided,
further, that the Purchase Contract Agent, upon receipt of notice of any such
voting rights by the Company, shall give the Company and the Collateral Agent at
least five Business Days' prior written notice of the manner in which it intends
to exercise, or its reasons for refraining from exercising, any such right. Upon
receipt of any notices and other communications in respect of any Pledged
Preferred Securities or the Pledged Subordinated Notes, including notice of any
meeting at which holders of the Pledged Preferred Securities or the Pledged
Subordinated Notes are entitled to vote or solicitation of consents, waivers or
proxies of holders of the Preferred Securities or Subordinated Notes, the
Collateral Agent shall use reasonable efforts to send promptly to the Purchase
Contract Agent such notice or communication, and as soon as reasonably
practicable after receipt of a written request therefor from the Purchase
Contract Agent, execute and deliver to the Purchase Contract Agent such proxies
and other instruments in respect of such Pledged Preferred Securities or the
Pledged Subordinated Notes (in form and substance satisfactory to the Collateral
Agent) as are prepared by the Purchase Contract Agent with respect to the
Pledged Preferred Securities or the Pledged Subordinated Notes.
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SECTION 7. RIGHTS AND REMEDIES.
SECTION 7.1 RIGHTS AND REMEDIES OF THE COLLATERAL AGENT.
(a) In addition to the rights and remedies specified in Section 5.7
hereof or otherwise available at law or in equity, after an event of default (as
specified in Section 7.1(b) below) hereunder, the Collateral Agent shall have
all of the rights and remedies with respect to the Collateral of a secured party
under the UCC (whether or not the UCC is in effect in the jurisdiction where the
rights and remedies are asserted) and the TRADES Regulations and such additional
rights and remedies to which a secured party is entitled under the laws in
effect in any jurisdiction where any rights and remedies hereunder may be
asserted. Without limiting the generality of the foregoing, such remedies may
include, to the extent permitted by applicable law, (1) retention of the Pledged
Preferred Securities, Pledged Subordinated Notes, Pledged Treasury Securities or
the appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) in full satisfaction of the Holders' obligations under
the Purchase Contracts and the Purchase Contract Agreement or (2) sale of the
Pledged Preferred Securities, Pledged Subordinated Notes, Pledged Treasury
Securities or the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) in one or more public or private
sales.
(b) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, in the event the Collateral Agent is unable
to make payments to the Company on account of the appropriate Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio, or on account of principal payments of any Pledged
Treasury Securities as provided in Section 3 hereof, in satisfaction of the
Obligations of the Holder of the PEPS Units (if a Tax Event Redemption has
occurred) of which such appropriate Applicable Ownership Interest (as specified
in clause (A) of the definition of such term) of the Treasury Portfolio or the
Holder of the Treasury PEPS Units of which such Pledged Treasury Securities, as
applicable, is a part under the related Purchase Contracts, the inability to
make such payments shall constitute an event of default hereunder and the
Collateral Agent shall have and may exercise, with reference to such Pledged
Treasury Securities or the appropriate Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio, as applicable, any and all of the rights and remedies available to a
secured party under the UCC and the TRADES Regulations after default by a
debtor, and as otherwise granted herein or under any other law.
(c) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, the Collateral Agent is hereby irrevocably
authorized to receive and collect all payments of (i) the liquidation amount of
the Pledged Preferred Securities, (ii) the principal amount of the Pledged
Subordinated Notes, (iii) the principal amount of the Pledged Treasury
Securities and (iv) the principal amount of the Applicable Ownership Interest
(as specified in clause (A) of the definition of such term) of the Treasury
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Portfolio, subject, in each case, to the provisions of Section 3 hereof, and as
otherwise granted herein.
(d) The Purchase Contract Agent and each Holder of Securities agrees
that, from time to time, upon the written request of the Company or the Purchase
Contract Agent, such Holder shall execute and deliver such further documents and
do such other acts and things as the Company may reasonably request in order to
maintain the Pledge, and the perfection and priority thereof, and to confirm the
rights of the Company and the Collateral Agent hereunder. The Purchase Contract
Agent shall have no liability to any Holder for executing any documents or
taking any such acts requested by the Company hereunder, except for liability
for its own gross negligent acts, its own gross negligent failure to act or its
own willful misconduct.
SECTION 7.2 SUBSTITUTION OF SUBORDINATED NOTES.
If the Trust shall have been dissolved and liquidated prior to the
Purchase Contract Settlement Date, the Securities Intermediary shall transfer to
the Collateral Agent Subordinated Notes having a Value equal to the liquidation
amount of the Pledged Preferred Securities for credit to the Collateral Account.
Upon credit to the Collateral Account of such Subordinated Notes, the Collateral
Agent shall release the Pledged Preferred Securities from the Collateral Account
and shall promptly transfer the same to the Trust.
SECTION 7.3 TAX EVENT REDEMPTION.
Upon the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, the Redemption Price payable on the Tax Event
Redemption Date with respect to the Tax Event Redemption Amount shall be
credited to the Collateral Account by the Property Trustee or, in case there has
been a dissolution of the Trust and the distribution of the related Subordinated
Notes, by the Indenture Trustee, on or prior to 12:30 p.m., New York City time
on such Tax Event Redemption date, by wire transfer of immediately available
funds. The Collateral Agent is hereby authorized to present the Pledged
Preferred Securities or the Pledged Subordinated Notes for payment as may be
required by their respective terms. Upon receipt of such funds, the Pledged
Preferred Securities or Pledged Subordinated Notes, as the case may be, shall be
released from the Collateral Account. In the event such funds are credited to
the Collateral Account, the Collateral Agent, at the written direction of the
Company, shall instruct the Securities Intermediary to (a) apply an amount equal
to the Redemption Amount of such Redemption Price to purchase the Treasury
Portfolio from the Quotation Agent for credit to the Collateral Account and (b)
promptly remit the remaining portion of such Redemption Price, if any, to the
Purchase Contract Agent for payment to the Holders of PEPS Units.
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SECTION 7.4 INITIAL AND ADDITIONAL REMARKETING; TREASURY PORTFOLIO
CASH PAYMENT TO REMARKETING AGENT OR ITS DESIGNATED
ENTITY.
(a) Unless a Tax Event Redemption shall have occurred, the Collateral
Agent shall, by 11:00 a.m., New York City time, on the fifth Business Day
immediately preceding February 18, 2004 or, in the case of any Additional
Remarketing subsequent to that date (written notice of which the Collateral
Agent shall have received from the Remarketing Agent), by 11:00 a.m., New York
City time on the second Business Day immediately preceding the date of such
Additional Remarketing, without any instruction from any Holder of PEPS Units,
present the related Pledged Preferred Securities or Pledged Subordinated Notes,
as the case may be, to the Remarketing Agent for remarketing other than those
Pledged Preferred Securities or Pledged Subordinated Notes in respect of which a
Holder shall have delivered a notice in the form set forth as Exhibit H hereto
together with cash in an amount equal to 100% of the Treasury Portfolio Purchase
Price plus such fees and expenses that the Remarketing Agent or its designated
entity shall charge from time to time to purchase such Treasury Portfolio (the
"Treasury Portfolio Cash Payment") to the Remarketing Agent or its designated
entity by 11:00 a.m., New York City time, on the fifth Business Day immediately
preceding the first Initial Remarketing Date, or by 11:00 a.m., New York City
time on the Second Business Day preceding the date of the Additional
Remarketing. Upon receiving such Pledged Preferred Securities or Pledged
Subordinated Notes, as the case may be, the Remarketing Agent, pursuant to the
terms of the Remarketing Agreement and the Supplemental Remarketing Agreement,
will use its reasonable efforts to remarket such Pledged Preferred Securities or
Pledged Subordinated Notes, as the case may be, on the Initial Remarketing Date
at a price of approximately 100.25% (but not less than 100%) of the Treasury
Portfolio Purchase Price. After deducting as the Remarketing Fee an amount not
exceeding 25 basis points (.25%) of the Treasury Portfolio Purchase Price from
any amount of such Proceeds in excess of the Treasury Portfolio Purchase Price,
the Remarketing Agent will remit the entire amount of the Proceeds of such
remarketing to the Collateral Agent on or prior to 12:00 p.m., New York City
time, on such remarketing date, by wire transfer in immediately available funds,
per the instructions and to the account specified in Section 4.11 hereof, in
exchange for the Pledged Preferred Securities or Pledged Subordinated Notes, as
the case may be. In the event a Holder elects to make the Treasury Portfolio
Cash Payment, such payment shall be made on or prior to 11:00 a.m., New York
City time, on the fifth Business Day immediately preceding the first Initial
Remarketing Date, or by 11:00 a.m., New York City time on the Second Business
Day preceding the date of the Additional Remarketing, by wire transfer in
immediately available funds at such place and at such account as may be
designated therefor by the Remarketing Agent. In the event the Collateral Agent
receives from the Remarketing Agent such proceeds from an Initial Remarketing,
the Collateral Agent will, at the written direction of the Company, apply an
amount equal to the Treasury Portfolio Purchase Price to purchase from the
Quotation Agent the Treasury Portfolio and promptly remit any remaining portion
of such proceeds to the Purchase Contract Agent for payment to the Holders of
PEPS Units. The Collateral Agent shall Transfer the Treasury Portfolio to the
Collateral Account to secure the obligation of all Holders of PEPS Units to
purchase
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Common Stock of the Company under the Purchase Contracts constituting a part of
such PEPS Units, in substitution for the Pledged Preferred Securities or Pledged
Subordinated Notes, as the case may be. Thereafter the Collateral Agent shall
have such security interests, rights and obligations with respect to the
Treasury Portfolio as it had in respect of the Pledged Preferred Securities or
Pledged Subordinated Notes, as the case may be, as provided herein, and any
reference herein to the Pledged Preferred Securities or Pledged Subordinated
Notes, as the case may be, shall be deemed to be reference to such Treasury
Portfolio, and any reference herein to distributions on the Pledged Preferred
Securities or interest on the Pledged Subordinated Notes, as the case may be,
shall be deemed to be a reference to distributions on such Treasury Portfolio.
(b) In connection with the Treasury Portfolio Cash Payment paid to the
Remarketing Agent for a Collateral substitution of the Pledged Preferred
Securities or Pledged Subordinated Notes, as the case may be, pursuant to
Section 7.4(a) hereof, subject to receipt by the Collateral Agent of the
Applicable Ownership Interest of the Treasury Portfolio required by Section 5.02
of the Purchase Contract Agreement, the Collateral Agent shall release, upon
written instruction from the Purchase Contract Agent substantially in the form
of Exhibit J hereto, the Pledged Preferred Securities or the Pledged
Subordinated Notes, as the case may be, underlying the number of PEPS Units
indicated in such instruction from the Pledge and transfer, without recourse,
such released Pledged Securities, free and clear of any lien, pledge or security
interest created hereby, to the Purchase Contract Agent for delivery by the
Purchase Contract Agent pursuant to the provisions of the Purchase Contract
Agreement. The Applicable Ownership Interest of the Treasury Portfolio received
by the Collateral Agent in connection with the Collateral substitution shall be
subject to the Pledge.
SECTION 7.5 SUBSTITUTIONS.
Whenever a Holder has the right to substitute Treasury Securities, Trust
Preferred Securities, Subordinated Notes or security entitlements for any of
them or the appropriate Applicable Ownership Interest of the Treasury Portfolio,
as the case may be, for financial assets held in the Collateral Account, such
substitution shall not constitute a novation of the security interest created
hereby.
SECTION 8. REPRESENTATIONS AND WARRANTIES; COVENANTS.
SECTION 8.1 REPRESENTATIONS AND WARRANTIES.
Each Holder from time to time, acting through the Purchase Contract
Agent as attorney-in-fact (it being understood that the Purchase Contract Agent
shall not be liable for any representation or warranty made by or on behalf of a
Holder), hereby represents and warrants to the Collateral Agent and the Company
(with respect to such Holder's interest in the Collateral), which
representations and warranties shall be deemed repeated on each day a Holder
Transfers Collateral that:
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(1) such Holder has the power to grant a security interest in and
lien on the Collateral;
(2) such Holder is the sole beneficial owner of the Collateral
and, in the case of Collateral delivered in physical form, is the sole
Holder of such Collateral and is the sole beneficial owner of, or has
the right to Transfer, the Collateral it Transfers to the Securities
Intermediary for credit to the Collateral Account, free and clear of any
security interest, lien, encumbrance, call, liability to pay money or
other restriction other than the security interest and lien granted
under Section 2 hereof;
(3) upon the Transfer of the Collateral to the Securities
Intermediary for credit to the Collateral Account, the Collateral Agent,
for the benefit of the Company, will have a valid and perfected first
priority security interest therein (assuming that any central clearing
operation or any securities intermediary or other entity not within the
control of the Holder involved in the Transfer of the Collateral,
including the Company, or Collateral Agent and the Securities
Intermediary on the Company's behalf, gives the notices and takes the
action required of it hereunder and under applicable law for perfection
of that interest and assuming the establishment and exercise of control
pursuant to Section 4 hereof); and
(4) the execution and performance by the Holder of its
obligations under this Agreement will not result in the creation of any
security interest, lien or other encumbrance on the Collateral other
than the security interest and lien granted under Section 2 hereof or
violate any provision of any existing law or regulation applicable to it
or of any mortgage, charge, pledge, indenture, contract or undertaking
to which it is a party or which is binding on it or any of its assets.
SECTION 8.2 COVENANTS.
The Holders from time to time, acting through the Purchase Contract
Agent as their attorney-in-fact (it being understood that the Purchase Contract
Agent shall not be liable for any covenant made by or on behalf of a Holder),
hereby covenant to the Collateral Agent that for so long as the Collateral
remains subject to the Pledge:
(1) neither the Purchase Contract Agent nor such Holders will
create or purport to create or allow to subsist any mortgage, charge,
lien, pledge or any other security interest whatsoever over the
Collateral or any part of it other than pursuant to this Agreement; and
(2) neither the Purchase Contract Agent nor such Holders will
sell or otherwise dispose (or attempt to dispose) of the Collateral or
any part of it except for the beneficial interest therein, subject to
the Pledge hereunder, transferred in connection with the Transfer of the
Securities.
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SECTION 9. THE COLLATERAL AGENT, THE SECURITIES INTERMEDIARY AND THE
CUSTODIAL AGENT.
It is hereby agreed as follows:
SECTION 9.1 APPOINTMENT, POWERS AND IMMUNITIES.
The Collateral Agent, the Securities Intermediary and the Custodial
Agent shall act as agents for the Company hereunder with such powers as are
specifically vested in the Collateral Agent, the Securities Intermediary and the
Custodial Agent by the terms of this Agreement, together with such other powers
as are reasonably incidental thereto, and shall have no duties, fiduciary or
otherwise, to any other Person. Each of the Collateral Agent, the Securities
Intermediary and the Custodial Agent and the Securities Intermediary shall:
(1) have no duties or responsibilities except those expressly set
forth in this Agreement and no implied covenants or obligations shall be
inferred from this Agreement against any of them, nor shall any of them
be bound by the provisions of any agreement by any party hereto beyond
the specific terms hereof;
(2) not be responsible for any recitals contained in this
Agreement, or in any certificate or other document referred to or
provided for in, or received by it under, this Agreement, the Securities
or the Purchase Contract Agreement, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this
Agreement (other than as against the Collateral Agent), the Securities
or the Purchase Contract Agreement or any other document referred to or
provided for herein or therein, or for any failure by the Company or any
other Person (except the Collateral Agent, the Securities Intermediary
or the Custodial Agent, as the case may be) to perform any of its
obligations hereunder or thereunder, or for the attachment, perfection,
priority or, except as expressly required hereby, maintenance of any
lien or security interest created or intended to be created hereunder;
(3) not be required to initiate or conduct any litigation or
collection proceedings hereunder (except in the case of the Collateral
Agent pursuant to directions furnished under Section 9.2 hereof, subject
to Section 9.6 hereof);
(4) not be responsible for any action taken, suffered or omitted
to be taken by it hereunder or under any other document or instrument
referred to or provided for herein or in connection herewith or
therewith, except for its own gross negligence or willful misconduct;
and
(5) not be required to advise any party as to selling or
retaining, or taking or refraining from taking any action with respect
to, any securities or other property deposited hereunder.
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Subject to the foregoing, during the term of this Agreement, the Collateral
Agent and the Securities Intermediary shall take all reasonable action in
connection with the safekeeping and preservation of the Collateral hereunder.
No provision of this Agreement shall require the Collateral Agent, the
Securities Intermediary or the Custodial Agent to expend or risk its own funds
or otherwise incur any financial liability in the performance of any of its
duties hereunder. In no event shall the Collateral Agent, the Securities
Intermediary or the Custodial Agent be liable for any amount in excess of the
Value of the Collateral. Notwithstanding the foregoing, each of the Collateral
Agent, the Securities Intermediary, the Custodial Agent and the Purchase
Contract Agent in its individual capacity hereby waives any right of setoff,
bankers' lien, liens or perfection rights as securities intermediary or any
counterclaim with respect to any of the Collateral.
SECTION 9.2 INSTRUCTIONS OF THE COMPANY.
The Company shall have the right, by one or more written instruments
executed and delivered to the Collateral Agent, the Securities Intermediary or
the Custodial Agent, as the case may be, to direct the time, method and place of
conducting any proceeding for the realization of any right or remedy available
to the Collateral Agent, or of exercising any power conferred on the Collateral
Agent, the Securities Intermediary or the Custodial Agent, as the case may be,
or to direct the taking or refraining from taking of any action authorized by
this Agreement; provided, however, that (i) such direction shall not conflict
with the provisions of any law or of this Agreement and (ii) the Collateral
Agent, the Securities Intermediary and the Custodial Agent shall be adequately
indemnified as provided herein and shall not be subject to personal liability.
Nothing contained in this Section 9.2 shall impair the right of the Collateral
Agent in its discretion to take any action or omit to take any action which it
deems proper and which is not inconsistent with such direction.
SECTION 9.3 RELIANCE BY COLLATERAL AGENT, SECURITIES INTERMEDIARY AND
CUSTODIAL AGENT.
Each of the Collateral Agent, the Securities Intermediary and the
Custodial Agent shall be entitled to rely upon any certification, order,
judgment, opinion, notice or other written communication (including, without
limitation, any thereof by telecopy) believed by it to be genuine and to have
been signed or sent by or on behalf of the proper Person or Persons (without
being required to determine the correctness of any fact stated therein) and
consult with and rely upon advice, opinions and statements of legal counsel and
other experts selected by the Collateral Agent, the Securities Intermediary, or
the Custodial Agent, as the case may be. Each of the Collateral Agent and the
Securities Intermediary 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. As to any matters not expressly provided
for by this Agreement, the Collateral Agent, the Securities
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Intermediary and the Custodial Agent shall in all cases be entitled to receive
and shall be fully protected in acting, or in refraining from acting, hereunder
in accordance with instructions given by the Company in accordance with this
Agreement.
SECTION 9.4 RIGHTS IN OTHER CAPACITIES.
The Collateral Agent, the Securities Intermediary and the Custodial
Agent and their affiliates may (without having to account therefor to the
Company) accept deposits from, lend money to, make their investments in and
generally engage in any kind of banking, trust or other business with the
Purchase Contract Agent, any other Person interested herein and any Holder of
Securities (and any of their respective subsidiaries or affiliates) as if it
were not acting as the Collateral Agent, the Securities Intermediary or the
Custodial Agent, as the case may be, and the Collateral Agent, the Securities
Intermediary and the Custodial Agent and their affiliates may accept fees and
other consideration from the Purchase Contract Agent and any Holder of
Securities without having to account for the same to the Company; provided that
each of the Securities Intermediary, the Collateral Agent and the Custodial
Agent covenants and agrees with the Company that it shall not accept, receive or
permit there to be created in favor of itself and shall take no affirmative
action to permit there to be created in favor of any other Person, any security
interest, lien or other encumbrance of any kind in or upon the Collateral other
than the lien created by the Pledge.
SECTION 9.5 NON-RELIANCE ON COLLATERAL AGENT, SECURITIES INTERMEDIARY
AND CUSTODIAL AGENT.
Neither the Securities Intermediary, the Collateral Agent nor the
Custodial Agent shall be required to keep itself informed as to the performance
or observance by the Purchase Contract Agent or any Holder of Securities of this
Agreement, the Purchase Contract Agreement, the Securities or any other document
referred to or provided for herein or therein or in connection herewith or
therewith or to inspect the properties or books of the Purchase Contract Agent
or any Holder of Securities. None of the Collateral Agent, the Securities
Intermediary or the Custodial Agent shall have any duty or responsibility to
provide the Company with any credit or other information concerning the affairs,
financial condition or business of the Purchase Contract Agent or any Holder of
Securities (or any of their respective affiliates) that may come into the
possession of the Collateral Agent, the Securities Intermediary or and the
Custodial Agent or any of their respective affiliates.
SECTION 9.6 COMPENSATION AND INDEMNITY.
The Company agrees to:
(1) pay the Collateral Agent, the Securities Intermediary and the
Custodial Agent from time to time such compensation as shall be agreed
in writing between the Company and the Collateral Agent, the Securities
Intermediary or the Custodial Agent, as the case may be, for all
services rendered by them hereunder;
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(2) indemnify and hold harmless the Collateral Agent, the
Securities Intermediary and the Custodial Agent and each of their
respective directors, officers, agents and employees (collectively, the
"INDEMNITEES"), harmless from and against any and all claims,
liabilities, losses, damages, fines, penalties and expenses (including
reasonable fees and expenses of counsel) (collectively, "LOSSES" and
individually, a "LOSS") that may be imposed on, incurred by, or asserted
against, the Indemnitees or any of them for following any instructions
or other directions upon which either the Collateral Agent, the
Securities Intermediary or the Custodial Agent is entitled to rely
pursuant to the terms of this Agreement; and
(3) in addition to and not in limitation of paragraph (2)
immediately above, indemnify and hold the Indemnitees and each of them
harmless from and against any and all Losses that may be imposed on,
incurred by or asserted against, the Indemnitees or any of them in
connection with or arising out of the Collateral Agent's, the Securities
Intermediary's or the Custodial Agent's acceptance or performance of its
powers and duties under this Agreement, provided the Collateral Agent,
the Securities Intermediary or the Custodial Agent have not acted with
gross negligence or engaged in willful misconduct with respect to the
specific Loss against which indemnification is sought.
Without prejudice to its rights hereunder, when any of the Collateral
Agent or Securities Intermediary incurs expenses or renders services after a
Termination Event occurs, the expenses and compensation for the services are
intended to constitute expenses of administration under the Bankruptcy Code or
any applicable state bankruptcy, insolvency or other similar law.
SECTION 9.7 FAILURE TO ACT.
In the event of any ambiguity in the provisions of this Agreement or any
dispute between or conflicting claims by or among the parties hereto or any
other Person with respect to any funds or property deposited hereunder, then at
its sole option, each of the Collateral Agent, the Securities Intermediary and
the Custodial Agent shall be entitled, after prompt notice to the Company and
the Purchase Contract Agent, to refuse to comply with any and all claims,
demands or instructions with respect to such property or funds so long as such
dispute or conflict shall continue, and the Collateral Agent, the Securities
Intermediary and the Custodial Agent shall not be or become liable in any way to
any of the parties hereto for its failure or refusal to comply with such
conflicting claims, demands or instructions. The Collateral Agent, the
Securities Intermediary and the Custodial Agent shall be entitled to refuse to
act until either:
(1) such conflicting or adverse claims or demands shall have been
finally determined by a court of competent jurisdiction or settled by
agreement between the conflicting parties as evidenced in a writing
satisfactory to the Collateral Agent, the Securities Intermediary or the
Custodial Agent, as the case may be; or
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(2) the Collateral Agent, the Securities Intermediary or the
Custodial Agent, as the case may be, shall have received security or an
indemnity satisfactory to it sufficient to save it harmless from and
against any and all loss, liability or reasonable out-of-pocket expense
which it may incur by reason of its acting.
The Collateral Agent, the Securities Intermediary and the Custodial Agent may in
addition elect to commence an interpleader action or seek other judicial relief
or orders as the Collateral Agent, the Securities Intermediary or the Custodial
Agent may deem necessary. Notwithstanding anything contained herein to the
contrary, neither the Collateral Agent, the Securities Intermediary nor the
Custodial Agent shall be required to take any action that is in its opinion
contrary to law or to the terms of this Agreement, or which would in its opinion
subject it or any of its officers, employees or directors to liability.
SECTION 9.8 RESIGNATION OF COLLATERAL AGENT, SECURITIES INTERMEDIARY
AND CUSTODIAL AGENT.
(a) Subject to the appointment and acceptance of a successor Collateral
Agent, Securities Intermediary or Custodial Agent as provided below:
(1) the Collateral Agent, the Securities Intermediary and the
Custodial Agent may resign at any time by giving notice thereof to the
Company and the Purchase Contract Agent as attorney-in-fact for the
Holders of Securities;
(2) the Collateral Agent, the Securities Intermediary and the
Custodial Agent may be removed at any time by the Company; and
(3) if the Collateral Agent, Securities Intermediary or the
Custodial Agent fails to perform any of its material obligations
hereunder in any material respect for a period of not less than 20 days
after receiving written notice of such failure by the Purchase Contract
Agent and such failure shall be continuing, the Collateral Agent, the
Securities Intermediary or the Custodial Agent may be removed by the
Purchase Contract Agent.
The Purchase Contract Agent shall promptly notify the Company of any removal of
the Collateral Agent, Securities Intermediary or Custodial Agent pursuant to
clause (3) of the immediately preceding sentence. Upon any such resignation or
removal, the Company shall have the right to appoint a successor Collateral
Agent, Securities Intermediary or the Custodial Agent, as the case may be. If no
successor Collateral Agent, Securities Intermediary or Custodial Agent, as the
case may be, shall have been so appointed and shall have accepted such
appointment within 30 days after the retiring Collateral Agent's, Securities
Intermediary's or Custodial Agent's giving of notice of resignation or the
Company or the Purchase Contract Agent giving notice of such removal, then the
retiring Collateral Agent, Securities Intermediary or Custodial Agent, as the
case may be, may petition any court of competent jurisdiction for the
appointment of a successor Collateral
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Agent, Securities Intermediary or the Custodial Agent, as the case may be. Each
of the Collateral Agent, the Securities Intermediary and Custodial Agent shall
be a bank or a national banking association which has an office (or an agency
office) in New York City with a combined capital and surplus of at least
$50,000,000 and shall not be the Purchase Contract Agent or any of its
affiliates. Upon the acceptance of any appointment as Collateral Agent,
Securities Intermediary or Custodial Agent, as the case may be, hereunder by a
successor Collateral Agent, Securities Intermediary or Custodial Agent, as the
case may be, such successor shall thereupon succeed to and become vested with
all the rights, powers, privileges and duties of the retiring Collateral Agent,
Securities Intermediary, or Custodial Agent, as the case may be, and the
retiring Collateral Agent, Securities Intermediary or Custodial Agent, as the
case may be, shall take all appropriate action to transfer any money and
property held by it hereunder (including the Collateral) to such successor. The
retiring Collateral Agent, Securities Intermediary or Custodial Agent shall,
upon such succession, be discharged from its duties and obligations as
Collateral Agent, Securities Intermediary or Custodial Agent hereunder. After
any retiring Collateral Agent's, Securities Intermediary's or Custodial Agent's
resignation hereunder as Collateral Agent, Securities Intermediary or Custodial
Agent, the provisions of Sections 9 and 11.7 hereof shall continue in effect for
its benefit in respect of any actions taken or omitted to be taken by it while
it was acting as the Collateral Agent, the Securities Intermediary or the
Custodial Agent.
SECTION 9.9 RIGHT TO APPOINT AGENT OR ADVISOR.
The Collateral Agent shall have the right to appoint agents or advisors
in connection with any of its duties hereunder, and the Collateral Agent shall
not be liable for any action taken or omitted by, or in reliance upon the advice
of, such agents or advisors selected in good faith. The appointment of agents
pursuant to this Section 9.9 shall be subject to prior consent of the Company,
which consent shall not be unreasonably withheld.
SECTION 9.10 SURVIVAL.
The provisions of Sections 9 and 11.7 hereof shall survive termination
of this Agreement and the resignation or removal of the Collateral Agent, the
Securities Intermediary or the Custodial Agent.
SECTION 9.11 EXCULPATION.
Anything contained in this Agreement to the contrary notwithstanding, in
no event shall the Collateral Agent, the Securities Intermediary or the
Custodial Agent or their officers, directors, employees or agents be liable
under this Agreement for indirect, special, punitive, or consequential loss or
damage of any kind whatsoever, including, but not limited to, lost profits,
whether or not the likelihood of such loss or damage was known to the Collateral
Agent, the Securities Intermediary or the Custodial Agent, or any of them.
32
38
SECTION 10. AMENDMENT.
SECTION 10.1 AMENDMENT WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company, the Collateral Agent,
the Securities Intermediary, the Custodial Agent and the Purchase Contract
Agent, at any time and from time to time, may amend this Agreement, in form
satisfactory to the Company, the Collateral Agent, the Securities Intermediary,
the Custodial Agent and the Purchase Contract Agent, to:
(1) evidence the succession of another Person to the Company, and
the assumption by any such successor of the covenants of the Company;
(2) evidence and provide for the acceptance of appointment
hereunder by a successor Collateral Agent, Securities Intermediary,
Custodial Agent or Purchase Contract Agent;
(3) add to the covenants of the Company for the benefit of the
Holders, or surrender any right or power herein conferred upon the
Company, provided such covenants or such surrender do not adversely
affect the validity, perfection or priority of the Pledge created
hereunder; or
(4) cure any ambiguity (or formal defect), correct or supplement
any provisions herein which may be inconsistent with any other such
provisions herein, or 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.
SECTION 10.2 AMENDMENT WITH CONSENT OF HOLDERS.
With the consent of the Holders of not less than a majority of the
Purchase Contracts at the time outstanding, by Act of such Holders delivered to
the Company, the Purchase Contract Agent, the Securities Intermediary, the
Collateral Agent and the Custodial Agent, as the case may be, the Company, the
Purchase Contract Agent, the Securities Intermediary, the Collateral Agent and
the Custodial Agent may amend this Agreement for the purpose of modifying in any
manner the provisions of this Agreement or the rights of the Holders in respect
of the Securities; provided, however, that no such supplemental agreement shall,
without the unanimous consent of the Holders of each Outstanding Security
adversely affected thereby:
(1) Change the amount or type of Collateral underlying a Security
(except for the rights of holders of PEPS Units to substitute the
Treasury Securities for the Pledged Preferred Securities or the Pledged
Subordinated Notes, as the case may be, or the rights of Holders of
Treasury PEPS Units to substitute Preferred Securities or Subordinated
Notes, as applicable, for the Pledged Treasury Securities), impair the
right of the Holder of any Security to receive distributions
33
39
on the underlying Collateral or otherwise adversely affect the Holder's
rights in or to such Collateral; or
(2) otherwise effect any action that would require the consent of
the Holder of each Outstanding Security affected thereby pursuant to the
Purchase Contract Agreement if such action were effected by an agreement
supplemental thereto; or
(3) reduce the percentage of Purchase Contracts the consent of
whose Holders is required for any such amendment;
provided that if any amendment or proposal referred to above would adversely
affect only the PEPS Units or only the Treasury PEPS Units, then only the
affected class of Holders as of the record date for the Holders entitled to vote
thereon will be entitled to vote on such amendment or proposal, and such
amendment or proposal shall not be effective except with the consent of Holders
of not less than a majority of such class; provided, further, that the unanimous
consent of the Holders of each outstanding Purchase Contract of such class
affected thereby shall be required to approve any amendment or proposal
specified in clauses (1) through (3) above.
It shall not be necessary for any Act of Holders under Section 10 hereof
to approve the particular form of any proposed amendment, but it shall be
sufficient if such Act shall approve the substance thereof.
SECTION 10.3 EXECUTION OF AMENDMENTS.
In executing any amendment permitted by Section 10 hereof, the
Collateral Agent, the Securities Intermediary, the Custodial Agent and the
Purchase Contract Agent shall be entitled to receive and (subject to Section 7.1
of the Purchase Contract Agreement with respect to the Purchase Contract Agent)
shall be fully protected in relying upon, an Opinion of Counsel stating that the
execution of such amendment is authorized or permitted by this Agreement and
that all conditions precedent, if any, to the execution and delivery of such
amendment have been satisfied.
SECTION 10.4 EFFECT OF AMENDMENTS.
Upon the execution of any amendment under Section 10 hereof, this
Agreement shall be modified in accordance therewith, and such amendment shall
form a part of this Agreement for all purposes; and every Holder of Certificates
theretofore or thereafter authenticated, executed on behalf of the Holders and
delivered under the Purchase Contract Agreement shall be bound thereby.
SECTION 10.5 REFERENCE TO AMENDMENTS.
Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any amendment pursuant to Section 10 hereof
may, and shall if required
34
40
by the Collateral Agent or the Purchase Contract Agent, bear a notation in form
approved by the Purchase Contract Agent and the Collateral Agent as to any
matter provided for in such amendment. If the Company shall so determine, new
Security Certificates so modified as to conform, in the opinion of the
Collateral Agent, the Purchase Contract Agent and the Company, to any such
amendment may be prepared and executed by the Company and authenticated,
executed on behalf of the Holders and delivered by the Purchase Contract Agent
in accordance with the Purchase Contract Agreement in exchange for Outstanding
Security Certificates.
SECTION 11. MISCELLANEOUS.
SECTION 11.1 NO WAIVER.
No failure on the part of the Collateral Agent, the Securities
Intermediary, the Custodial Agent 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 Collateral Agent, the Securities Intermediary,
the Custodial Agent or any of their respective agents of any right, power or
remedy hereunder preclude any other or further exercise thereof or the exercise
of any other right, power or remedy. The remedies herein are cumulative and are
not exclusive of any remedies provided by law.
SECTION 11.2 GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH,
THE LAWS OF THE STATE OF NEW YORK. The Company, the Collateral Agent, the
Securities Intermediary, the Custodial Agent and the Holders from time to time
of the Securities, acting through the Purchase Contract 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 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 Collateral Agent, the Securities Intermediary, the
Custodial Agent and the Holders from time to time of the Securities, acting
through the Purchase Contract 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.
SECTION 11.3 NOTICES.
All notices, requests, consents and other communications provided for
herein (including, without limitation, any modifications of, or waivers or
consents under, this Agreement) shall be given or made in writing (including,
without limitation, by telecopy) delivered to the intended recipient at the
"ADDRESS FOR NOTICES" specified below its name on the signature pages hereof or,
as to any party, at such other address as shall be
35
41
designated by such party in a notice to the other parties. Except as otherwise
provided in this Agreement, all such communications shall be deemed to have been
duly given when transmitted by telecopier or personally delivered or, in the
case of a mailed notice, upon receipt, in each case given or addressed as
aforesaid.
SECTION 11.4 SUCCESSORS AND ASSIGNS.
This Agreement shall be binding upon and inure to the benefit of the
respective successors and assigns of the Company, the Collateral Agent, the
Securities Intermediary, the Custodial Agent and the Purchase Contract Agent,
and the Holders from time to time of the Securities, by their acceptance of the
same, shall be deemed to have agreed to be bound by the provisions hereof and to
have ratified the agreements of, and the grant of the Pledge hereunder by, the
Purchase Contract Agent.
SECTION 11.5 COUNTERPARTS.
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument, and any of
the parties hereto may execute this Agreement by signing any such counterpart.
SECTION 11.6 SEVERABILITY.
If any provision hereof is invalid and unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in order to carry out the intentions of the parties
hereto as nearly as may be possible and (ii) the invalidity or unenforceability
of any provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction.
SECTION 11.7 EXPENSES, ETC.
The Company agrees to reimburse the Collateral Agent, the Securities
Intermediary and the Custodial Agent for:
(1) all reasonable costs and expenses of the Collateral Agent,
the Securities Intermediary and the Custodial Agent (including, without
limitation, the reasonable fees and expenses of counsel to the
Collateral Agent, the Securities Intermediary and the Custodial Agent),
in connection with the negotiation, preparation, execution and delivery
or performance of any services under or in connection with this
Agreement, including any modification, supplement or waiver of any of
the terms of this Agreement;
(2) in addition to and not in limitation of paragraph (1)
immediately above, all reasonable costs and expenses of the Collateral
Agent, the Securities Intermediary and the Custodial Agent (including,
without limitation, reasonable fees and expenses of counsel) in
connection with (i) any enforcement or
36
42
proceedings resulting or incurred in connection with causing any Holder
of Securities to satisfy its obligations under the Purchase Contracts
forming a part of the Securities and (ii) the enforcement of this
Section 11.7;
(3) all transfer, stamp, documentary or other similar taxes,
assessments or charges levied by any governmental or revenue authority
in respect of this Agreement or any other document referred to herein
and all costs, expenses, taxes, assessments and other charges incurred
in connection with any filing, registration, recording or perfection of
any security interest contemplated hereby (it being understood, however,
that none of the Collateral Agent, Securities Intermediary or Custodial
Agent shall have any duty or obligation in respect of any such filing,
registration, recording or perfection unless and until specifically
requested in writing by the Company to take any action in respect
thereto);
(4) all fees and expenses of any agent, expert or advisor
appointed by the Collateral Agent and, in the case of any agent,
consented to by the Company under Section 9.9 of this Agreement; and
(5) any other out-of-pocket costs and expenses reasonably
incurred by the Collateral Agent, the Securities Intermediary and the
Custodial Agent in connection with the performance of their duties
hereunder.
SECTION 11.8 SECURITY INTEREST ABSOLUTE.
All rights of the Collateral Agent and security interests hereunder, and
all obligations of the Holders from time to time hereunder, shall be absolute
and unconditional irrespective of:
(1) any lack of validity or enforceability of any provision of
the Purchase Contracts or the Securities or any other agreement or
instrument relating thereto;
(2) any change in the time, manner or place of payment of, or any
other term of, or any increase in the amount of, all or any of the
obligations of Holders of the Securities under the related Purchase
Contracts, or any other amendment or waiver of any term of, or any
consent to any departure from any requirement of, the Purchase Contract
Agreement or any Purchase Contract or any other agreement or instrument
relating thereto; or
(3) any other circumstance which might otherwise constitute a
defense available to, or discharge of, a borrower, a guarantor or a
xxxxxxx.
SECTION 11.9 NOTICE OF TAX EVENT, TAX EVENT REDEMPTION AND TERMINATION
EVENT.
Upon the occurrence of a Tax Event, a Tax Event Redemption or a
Termination Event, the Company shall deliver written notice to the Collateral
Agent and the Securities
37
43
Intermediary and unless and until any such notice is so delivered, the
Collateral Agent and the Securities Intermediary may conclusively presume that
no such events exist. Upon the written request of the Collateral Agent or the
Securities Intermediary, the Company shall inform such party whether or not a
Tax Event, a Tax Event Redemption or a Termination Event has occurred.
SECTION 11.10 BOOK-ENTRY INTERESTS
Unless and until definitive, fully registered Certificates have been
issued to Beneficial Owners pursuant to Section 3.09 of the Purchase Contract
Agreement, the Collateral Agent, Securities Intermediary and Custodial Agent
shall be entitled to deal with the Depositary for all purposes of this Agreement
(including the receipt or transfer of any funds hereunder) as the Holder of the
Securities, shall have no obligation to the Beneficial Owners and the rights of
the Beneficial Owners shall be exercised only through the Depositary and shall
be limited to those established by law and agreement between such Beneficial
Owners and the Depositary or the Depositary Participants. The provisions of
Sections 3.06 and 3.07 of the Purchase Contract Agreement are hereby made
applicable to the Collateral Agent, Securities Intermediary and Custodial Agent,
mutatis mutandis, as if they were the Purchase Contract Agent as referred to
therein.
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44
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
PPL CORPORATION THE CHASE MANHATTAN BANK as
Purchase Contract Agent and as
attorney-in-fact of the Holders from time
to time of the Securities
By: /s/ Xxxxx X. Xxxx By: /s/ Xxxxxxx X. Xxxxxxx
----------------------------------------------- -------------------------------------------
Name: Xxxxx X. Xxxx Name: Xxxxxxx X. Xxxxxxx
Title: Vice-President - Finance and Title: Vice President
Treasurer
Address for Notices: Address for Notices:
PPL Corporation The Chase Manhattan Bank
Two North Ninth Street 000 Xxxx 00xx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxxx 00000-0000 Xxx Xxxx, XX 00000
Attention: Treasurer Attention: Institutional Trust Services
Telecopy: (000) 000-0000 Administration
Telecopy: (000) 000-0000
THE BANK OF NEW YORK, THE BANK OF NEW YORK,
As Collateral Agent as Securities Intermediary
By: /s/ Xxxx X. Xxxxxxxxx By: /s/ Xxxx X. Xxxxxxxxx
----------------------------------------------- -------------------------------------------
Name: Xxxx X. Xxxxxxxxx Name: Xxxx X. Xxxxxxxxx
Title: Vice President Title: Vice President
Addresses for Notices: Addresses for Notices:
The Bank of New York The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 21 West 000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 10286 Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration- Attention: Corporate Trust Administration-
Corporate Finance Unit Corporate Finance Unit
Telecopy: (000) 000-0000 Telecopy: (000) 000-0000
39
45
THE BANK OF NEW YORK,
As Custodial Agent
By: /s/ Xxxx X. Xxxxxxxxx
-----------------------------------------------
Name: Xxxx X. Xxxxxxxxx
Title: Vice President
Addresses for Notices:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration-
Corporate Finance Unit
Telecopy: (000) 000-0000
40
46
EXHIBIT A
INSTRUCTION
FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
(Establishment of Treasury PEPS Units)
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration-Corporate Finance Unit
Telecopy: (000) 000-0000
Re: PEPS Units of PPL Corporation (the "COMPANY") and PPL Capital
Funding Trust I
The securities account of The Bank of New York, as Collateral
Agent, maintained by the Securities Intermediary and designated
The Bank of New York, as Collateral Agent of PPL Corporation, as
pledgee of The Chase Manhattan Bank, as the Purchase Contract
Agent on behalf of and as attorney-in-fact for the Holders" (the
"COLLATERAL ACCOUNT")
Please refer to the Pledge Agreement, dated as of May 9, 2001 (the
"PLEDGE AGREEMENT"), among the Company, you, as Collateral Agent, , as
Securities Intermediary, and as Custodial Agent, and the undersigned, as
Purchase Contract Agent and as attorney-in-fact for the holders of PEPS Units
from time to time. Capitalized terms used herein but not defined shall have the
meaning set forth in the Pledge Agreement.
We hereby notify you in accordance with Section 5.2 of the Pledge
Agreement that the holder of securities named below (the "HOLDER") has elected
to substitute $__________ Value of Treasury Securities or security entitlements
with respect thereto in exchange for [an equal Value of [Pledged Preferred
Securities] [Pledged Subordinated Notes] relating to _________ PEPS Units] and
has delivered to the undersigned a notice stating that the Holder has
Transferred such Treasury Securities or security entitlements with respect
thereto to the Securities Intermediary for credit to the Collateral Account.
We hereby request that you instruct the Securities Intermediary, upon
confirmation that such Treasury Securities or security entitlements with respect
thereto have been credited to the Collateral Account, to release to the
undersigned [an equal Value of [Pledged Preferred Securities] [Pledged
Subordinated Notes]] in accordance with Section 5.2 of the Pledge Agreement. We
also hereby confirm that no Tax Event Redemption has occurred.
A-1
47
THE CHASE MANHATTAN BANK,
as Purchase Contract Agent and as
Date: attorney-in-fact of the Holders from
------------- time to time of the Securities
By:
-----------------------------------
Name:
Title:
A-2
48
Please print name and address of Holder electing to substitute Treasury
Securities or security entitlements thereto for the [Pledged Preferred
Securities] [Pledged Subordinated Notes]:
------------------------------ ---------------------------------------
Name Social Security or other
Taxpayer Identification Number,
if any
------------------------------
Address
------------------------------
------------------------------
---------------------------------------
------------------------------
Trades Account No. of or through
which Holder transferred Treasury
Securities
A-3
49
EXHIBIT B
INSTRUCTION
FROM COLLATERAL AGENT
TO SECURITIES INTERMEDIARY
(Establishment of Treasury PEPS Units)
The Bank of New York, as Securities Intermediary
000 Xxxxxxx Xxxxxx
Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration-Corporate Finance Unit
Telecopy: (000) 000-0000
Re: PEPS Units of PPL Corporation (the "COMPANY") and PPL Capital
Funding Trust I
The securities account of The Bank of New York, as Collateral
Agent, maintained by the Securities Intermediary and designated
The Bank of New York, as Collateral Agent of PPL Corporation, as
pledgee of The Chase Manhattan Bank, as the Purchase Contract
Agent on behalf of and as attorney-in-fact for the Holders" (the
"COLLATERAL ACCOUNT")
Please refer to the Pledge Agreement, dated as of May 9, 2001 (the
"PLEDGE AGREEMENT"), among the Company, you, as Collateral Agent, as Securities
Intermediary and as Custodial Agent, The Chase Manhattan Bank, as Purchase
Contract Agent and as attorney-in-fact for the holders of PEPS Units from time
to time, and the undersigned, as Collateral Agent. Capitalized terms used herein
but not defined shall have the meanings set forth in the Pledge Agreement.
When you have confirmed that $__________ Value of Treasury Securities or
security entitlements thereto has been credited to the Collateral Account by or
for the benefit of _________, as Holder of PEPS Units (the "HOLDER"), you are
hereby instructed to release from the Collateral Account [an equal Value of
[Preferred Securities or security entitlements thereto] [Subordinated Notes or
security entitlements thereto]] relating to _____ PEPS Units of the Holder] by
Transfer to the Purchase Contract Agent.
The Bank of New York,
Dated: as Collateral Agent
------------
By:
-----------------------------------
Name:
Title:
B-1
50
Please print name and address of Holder:
------------------------------ ---------------------------------------
Name Social Security or other
Taxpayer Identification Number,
if any
------------------------------
Address
------------------------------
------------------------------
---------------------------------------
------------------------------
Trades Account No. of or through
which Holder transferred Treasury
Securities
B-2
51
EXHIBIT C
INSTRUCTION
FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
(Reestablishment of PEPS Units )
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration-Corporate Finance Unit
Telecopy: (000) 000-0000
Re: PEPS Units of PPL Corporation (the "COMPANY") and PPL Capital
Funding Trust I
Please refer to the Pledge Agreement dated as of May 9, 2001 (the
"PLEDGE AGREEMENT"), among the Company, you, as Collateral Agent, as Securities
Intermediary and as Custodial Agent, and the undersigned, as Purchase Contract
Agent and as attorney-in-fact for the holders of PEPS Units from time to time.
Capitalized terms used herein but not defined shall have the meaning set forth
in the Pledge Agreement.
We hereby notify you in accordance with Section 5.3(a) of the Pledge
Agreement that the holder of securities listed below (the "HOLDER") has elected
to substitute [$_____________ Value of [Preferred Securities or security
entitlements thereto] [Subordinated Notes or security entitlements thereto]] in
exchange for $__________ Value of Pledged Treasury Securities and has delivered
to the undersigned a notice stating that the holder has Transferred such
[Preferred Securities or security entitlements thereto] [Subordinated Notes or
security entitlements thereto] to the Securities Intermediary, for credit to the
Collateral Account.
We hereby request that you instruct the Securities Intermediary, upon
confirmation that such [Preferred Securities or security entitlements thereto]
[Subordinated Notes or security entitlements thereto] have been credited to the
Collateral Account, to release to the undersigned $__________ Value of Treasury
Securities or security entitlements thereto related to _____ PEPS Units of such
Holder in accordance with Section 5.3(a) of the Pledge Agreement. We also hereby
confirm that no Tax Event Redemption nor a successful Initial Remarketing has
occurred.
THE CHASE MANHATTAN BANK,
Date: as Purchase Contract Agent
-------------
By:
----------------------------------
Name:
Title:
C-1
52
Please print name and address of Holder electing to substitute
[Preferred Securities or security entitlements thereto] [Subordinated Notes or
security entitlements thereto] for Pledged Treasury Securities:
------------------------------ ---------------------------------------
Name Social Security or other
Taxpayer Identification Number,
if any
------------------------------
Address
------------------------------
------------------------------
---------------------------------------
------------------------------
DTC Account No. through which
Holder transferred Preferred
Securities or Subordinated Notes or
security entitlements thereto
C-2
53
EXHIBIT D
INSTRUCTION
FROM COLLATERAL AGENT
TO SECURITIES INTERMEDIARY
(Reestablishment of PEPS Units)
The Bank of New York, as Securities Intermediary
000 Xxxxxxx Xxxxxx
Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration-Corporate Finance Unit
Telecopy: (000) 000-0000
Re: _______ PEPS Units of PPL Corporation
(the "COMPANY") and PPL Capital Funding Trust I
The securities account of The Bank of New York, as Collateral
Agent, maintained by the Securities Intermediary and designated
The Bank of New York, as Collateral Agent of PPL Corporation, as
pledgee of The Chase Manhattan Bank, as the Purchase Contract
Agent on behalf of and as attorney-in-fact for the Holders" (the
"COLLATERAL ACCOUNT")
Please refer to the Pledge Agreement dated as of May 9, 2001 (the
"PLEDGE AGREEMENT"), among the Company, you, as Collateral Agent, as Securities
Intermediary and as Custodial Agent, The Chase Manhattan Bank, as Purchase
Contract Agent and as attorney-in-fact for the holders of PEPS Units from time
to time, and the undersigned, as Collateral Agent. Capitalized terms used herein
but no defined shall have the meaning set forth in the Pledge Agreement.
When you have confirmed that $ __________ Value of [Preferred Securities
or security entitlements thereto] [Subordinated Notes or security entitlements
thereto] has been credited to the Collateral Account by or for the benefit of
________________, as Holder of PEPS Units (the "HOLDER"), you are hereby
instructed to release from the Collateral Account $ ________________ Value of
Treasury Securities or security entitlements thereto by Transfer to the Purchase
Contract Agent.
The Bank of New York,
Dated: As Collateral Agent
------------
By:
--------------------------------
Name:
Title:
D-1
54
Please print name and address of Holder electing to substitute
[Preferred Securities or security entitlements thereto] [Subordinated Notes or
security entitlements thereto] for Pledged Treasury Securities:
------------------------------ ---------------------------------------
------------------------------ ---------------------------------------
Name Social Security or other
Taxpayer Identification Number,
if any
------------------------------
Address
------------------------------
------------------------------
---------------------------------------
------------------------------
DTC Account No. through which
Holder transferred Preferred
Securities or Subordinated Notes or
security entitlements thereto
D-2
55
EXHIBIT E
NOTICE OF CASH SETTLEMENT FROM SECURITIES INTERMEDIARY
TO PURCHASE CONTRACT AGENT
(Cash Settlement Amounts)
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Corporate Trustee Administration
Telecopy:
-------------------
Re: PEPS Units of PPL Corporation
(the "COMPANY") and PPL Capital Funding Trust I
Please refer to the Pledge Agreement dated as of May 9, 2001 (the
"PLEDGE AGREEMENT"), by and among you, the Company, The Bank of New York, as
Collateral Agent, as Custodial Agent and the undersigned, as Securities
Intermediary. Unless otherwise defined herein, terms defined in the Pledge
Agreement are used herein as defined therein.
In accordance with Section 5.5(d) of the Pledge Agreement, we hereby
notify you that as of 11:00 a.m. (New York City time) [(i) on the fourth
Business Day immediately preceding May 18, 2004], [on the Business Day
immediately preceding May 18, 2004], we have received [(i) $ _______________ in
immediately available funds paid in an aggregate amount equal to the Purchase
Price to the Company on the Purchase Contract Settlement Date with respect to
________________ PEPS Units] [(ii) $ ___________ in immediately available funds
paid in an aggregate amount equal to the Purchase Price to the Company on the
Purchase Contract Settlement Date with respect to ______ Treasury PEPS Units].
The Bank of New York,
Date: as Securities Intermediary
-------------
By:
--------------------------------
Name:
Title:
X-0
00
XXXXXXX X
TO CUSTODIAL AGENT REGARDING REMARKETING
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration-Corporate Finance Unit
Telecopy: (000) 000-0000
Re: [Preferred Securities] [Subordinated Notes] of [PPL Capital
Funding Trust I] [PPL Capital Funding, Inc.]
The undersigned hereby notifies you in accordance with Section 5.7(c) of
the Pledge Agreement, dated as of May 9, 2001 (the "PLEDGE AGREEMENT"), among
PPL Corporation, yourselves, as Collateral Agent and Securities Intermediary and
Custodial Agent, and The Chase Manhattan Bank, as Purchase Contract Agent and as
attorney-in-fact for the Holders of PEPS Units and of Treasury PEPS Units from
time to time, that the undersigned elects to deliver $____ [aggregate
liquidation preference] [principal amount] of [Preferred Securities]
[Subordinated Notes] for delivery to the Remarketing Agent on the Business Day
immediately preceding the [Initial Remarketing Date] [Final Remarketing Date]
for remarketing pursuant to Section 5.7(c) of the Pledge Agreement. The
undersigned will, upon request of the Remarketing Agent, execute and deliver any
additional documents deemed by the Remarketing Agent or by the Company to be
necessary or desirable to complete the sale, assignment and transfer of the
[Preferred Securities] [Subordinated Notes] tendered hereby.
The undersigned hereby instructs you, upon receipt of the Proceeds of
such remarketing from the Remarketing Agent to deliver such Proceeds to the
undersigned in accordance with the instructions indicated herein under "A.
Payment Instructions". The undersigned hereby instructs you, in the event of a
Failed [Initial] [Final] Remarketing, upon receipt of the [Preferred Securities]
[Subordinated Notes] tendered herewith from the Remarketing Agent, to deliver
the [Preferred Securities] [Subordinated Notes] to the person(s) and the
address(es) indicated herein under "B. Delivery Instructions."
With this notice, the undersigned hereby (i) represents and warrants
that the undersigned has full power and authority to tender, sell, assign and
transfer the [Preferred Securities] [Subordinated Notes] tendered hereby and
that the undersigned is the record owner of any [Preferred Securities]
[Subordinated Notes] tendered herewith in physical form or a participant in The
Depositary Trust Company ("DTC") and the beneficial owner of any [Preferred
Securities] [Subordinated Notes] tendered herewith by book-entry transfer to
your account at DTC and (ii) agrees to be bound by the terms and conditions of
Section 5.7(c) of the Pledge Agreement. Capitalized terms used herein but not
defined shall have the meaning set forth in the Pledge Agreement.
F-1
57
EXHIBIT F
Date:
-------------
By:
--------------------------------
Name:
Title:
Signature Guarantee:
Please print name and address:
----------------------------------- --------------------------------
Name Social Security or other
Taxpayer Identification
Number, if any
Address
-----------------------------------
-----------------------------------
-----------------------------------
---------------------------------------------- -----------------------------------------
A. PAYMENT INSTRUCTIONS B. DELIVERY INSTRUCTIONS
---------------------------------------------- -----------------------------------------
Proceeds of the remarketing should be paid In the event of a failed
by check in the name of the person(s) set remarketing, Preferred
forth below and mailed to the address set Securities or Subordinated
forth below Notes which are in physical
form should be delivered to the
person(s) set forth
below and mailed to the address set
forth below.
Name(s)
----------------------------- Name(s)
(Please Print)
-----------------------------
Address (Please Print)
----------------------------- Address
(Please Print)
-----------------------------
(Please Print)
-----------------------------
----------------------------- -----------------------------
(Zip Code)
-----------------------------
(Zip Code)
-----------------------------
(Tax Identification or Social Security
Number) -----------------------------
(Tax Identification or Social Security
If a DTC Participant, add wire transfer Number)
instructions and DTC Account No.
In the event of a failed remarketing,
Preferred Securities or Subordinated
----------------------------- Notes which are in book-entry form
Wire transfer instructions should be credited to the account at
The Depositary Trust Company set forth
below.
-----------------------------
DTC Account Number
-----------------------------
DTC Account Number
---------------------------------------------- -----------------------------------------
F-2
58
EXHIBIT F
---------------------------------------------- -----------------------------------------
Name of Account Party:
---------------------------------------------- -----------------------------------------
F-3
59
EXHIBIT G
INSTRUCTION TO CUSTODIAL AGENT REGARDING
WITHDRAWAL FROM REMARKETING
The Bank of New York
000 Xxxxxxx Xxxxxx
Xxxxx 00 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust Administration-Corporate Finance Unit
Telecopy: (000) 000-0000
Re: [Preferred Securities] [Subordinated Notes] of [PPL Capital
Funding Trust I] [PPL Capital Funding, Inc.]
The undersigned hereby notifies you in accordance with Section 5.7(c) of
the Pledge Agreement, dated as of May 9, 2001 (the "PLEDGE AGREEMENT"), among
PPL Corporation, yourselves, as Collateral Agent, Securities Intermediary and
Custodial Agent, and The Chase Manhattan Bank, as Purchase Contract Agent and as
attorney-in-fact for the Holders of PEPS Units and Treasury PEPS Units from time
to time, that the undersigned elects to withdraw the $____ [aggregate
liquidation preference] [principal amount] of [Preferred Securities]
[Subordinated Notes] delivered to the Custodial Agent on ______________,
__________ for remarketing pursuant to Section 5.7(c) of the Pledge Agreement.
The undersigned hereby instructs you to return such [Preferred Securities]
[Subordinated Notes] to the undersigned in accordance with the undersigned's
instructions. With this notice, the undersigned hereby agrees to be bound by the
terms and conditions of Section 5.7(c) of the Pledge Agreement. Capitalized
terms used herein but not defined shall have the meaning set forth in the Pledge
Agreement.
Date:
-------------
By:
-------------------------------
Name:
Title:
Signature Guarantee:
G-1
60
Please print name and address:
------------------------------ ---------------------------------------
Name Social Security or other
Taxpayer Identification Number,
if any
Address
------------------------------
------------------------------
------------------------------
---------------------------------------
------------------------------
DTC Account No. to which such Preferred
Securities or Subordinated Notes or
security entitlements thereto are to be
credited at the Depository Trust Company
G-2
61
Exhibit H
NOTICE TO MAKE TREASURY PORTFOLIO CASH PAYMENT
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Re: ________ PEPS Units of PPL Corporation, a Pennsylvania
corporation (the "COMPANY") and PPL Capital Funding Trust I
The undersigned Holder hereby irrevocably notifies you in accordance
with Section 5.02 of the Purchase Contract Agreement, dated as of May 9, 2001
(the "PURCHASE CONTRACT AGREEMENT") and Section 7.4 of the Pledge Agreement,
dated as of May 9, 2001 (the "PLEDGE AGREEMENT"); that such Holder has elected
to pay to the Remarketing Agent for purchase of the Treasury Portfolio, prior to
or at 11:00 a.m. (New York City time) on the fifth Business Day immediately
preceding the first Initial Remarketing Date or the third Business Day
immediately preceding February 18, 2004, or, in the case of an Additional
Remarketing, on the second Business Day immediately preceding such Initial
Remarketing Date (in lawful money of the United States by wire transfer, in
immediately available funds), $______ as the Treasury Portfolio Purchase Price
for the Treasury Portfolio to be purchased and substituted for the Holder's
Preferred Trust Securities on the applicable Reset Effective Date.
Date:
---------------------------- -----------------------------------
Signature
Signature Guarantee:
---------------
H-1
62
Please print name and address of Registered Holder:
------------------------------ ---------------------------------------
Name Social Security or other
Taxpayer Identification Number,
if any
------------------------------
Address
------------------------------
------------------------------
---------------------------------------
------------------------------
DTC Account No. of Holder
H-2
63
EXHIBIT I
INSTRUCTION TO PURCHASE
CONTRACT AGENT AND SECURITIES INTERMEDIARY
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Corporate Trustee Administration
Re: PEPS Units of PPL Corporation (the "Company")
and PPL Capital Funding Trust I
The undersigned Holder hereby notifies you that it has delivered to the
Remarketing Agent, for credit to the Collateral Account, cash in the amount of
$______ for the purchase of the Applicable Ownership Interest in the Treasury
Portfolio in exchange for $__________ Preferred Securities or Subordinated
Notes, as the case may be, held in the Collateral Account in respect of the
number of PEPS Units specified below, in accordance with the Pledge Agreement,
dated as of May 9, 2001 (the "Pledge Agreement"; unless otherwise defined
herein, terms defined in the Pledge Agreement are used herein as defined
therein). The undersigned Holder has paid 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 Notes related to
such PEPS Units.
Date:
---------------------------- -----------------------------------
Signature
Signature Guarantee:
---------------
Please print name and address of Registered Holder:
------------------------------ ---------------------------------------
Name Social Security or other
Taxpayer Identification Number,
if any
Address
------------------------------ Number of PEPS Units
------------------
------------------------------
------------------------------
I-1
64
EXHIBIT J
INSTRUCTION
FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
The Bank of New York
000 Xxxxxxx Xxxxxx - 0000
Xxx Xxxx, XX 00000
Re: PEPS Units of PPL Corporation (the "Company")
and PPL Capital Funding Trust I
Please refer to the Pledge Agreement dated as of May 9, 2001 (the
"Pledge Agreement"), among the Company, you, as Collateral Agent, Securities
Intermediary and Custodial Agent, and the undersigned, as Purchase Contract
Agent and as attorney-in-fact for the holders of PEPS Units from time to time.
Capitalized terms used herein but not defined shall have the meaning set forth
in the Pledge Agreement.
We hereby instruct you in accordance with Section 74 of the Pledge
Agreement that we have received notice from the Holder named below that the
Holder has elected to substitute $________ per Preferred Security or
Subordinated Note, as the case may be, as permitted under Section 5.02 of the
Purchase Contract Agreement through optional cash payment to the Remarketing
Agent of the Treasury Portfolio Purchase Price. The Applicable Ownership
Interest of the Treasury Portfolio will, upon receipt thereof from the
Remarketing Agent, be substituted for $___________ in principal amount of the
Pledged Preferred Security or the Pledged Subordinated Note, as the case may be.
We have received a notice stating that the Holder has transferred such cash to
the Remarketing Agent for the purchase of the Applicable Ownership Interest of
the Treasury Portfolio.
We hereby request that you as the Collateral Agent cause the Securities
Intermediary, upon confirmation that such Applicable Ownership Interest of the
Treasury Portfolio has been credited to the Collateral Account, to release to us
for delivery to such Holder _________ principal amount of Preferred Security or
Subordinated Note, as the case may be, in accordance with Section 7.4 of the
Pledge Agreement.
THE CHASE MANHATTAN BANK,
as Purchase Contract Agent
Date: By:
------------- ------------------------------
Name:
Title:
J-1
