Exhibit 4(hhhh)
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION ("DTC"), TO A NOMINEE OF DTC OR BY DTC OR ANY
SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR
DEPOSITARY. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
TO XXXXXXX XXXXX & CO., INC. OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE
OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
REGISTERED XX. 0 XXXXX Xx. 000000 ___
XXXXXXX XXXXX & CO., INC.
MEDIUM-TERM NOTE,
SERIES B
7% Stock Portfolio Linked Notes due August 18, 2000
(Linked to the performance of the Common Stock of
Intuit Inc., CKS Group, Inc. and CNET, Inc.)
XXXXXXX XXXXX & CO., INC., a Delaware corporation (hereinafter referred to
as the "Company", which term includes any successor corporation under the
Indenture herein referred to), for value received, hereby promises to pay and
discharge each Note evidenced hereby on August 18, 2000 (the "Maturity Date") by
delivering to CEDE & CO., or registered assigns with respect to ______________
DOLLARS ($____________) of the principal amount hereof (i) the Cash Amount or
(ii) if the holder so elects as hereinafter provided, the Equivalent Share
Amount, each as defined below and determined in accordance with the provisions
set forth below, and to pay interest on the principal amount hereof from August
18, 1998, or from the most recent date in respect of which interest has been
paid or duly provided for, semiannually in arrears on February 18 and August 18,
in each year (each an "Interest Payment Date"), commencing
1
February 18, 1999, at the rate of 7% per annum (the "Interest Rate"), until the
Cash Amount is paid or duly made available for payment or the Equivalent Share
Amount is delivered or duly made available for delivery, as the case may be. The
Notes will be issued in minimum denominations of $1,000 and integral multiples
thereof. The interest so payable and punctually paid or duly provided for on any
Interest Payment Date will, as provided in such Indenture, be paid to the Person
in whose name this Note (or one or more Predecessor Securities) is registered at
the close of business on the Regular Record Date for such interest, which shall
be the fifteenth day (whether or not a Business Day) next preceding such
Interest Payment Date. Any such interest which is payable, but is not punctually
paid or duly provided for on any Interest Payment Date, shall forthwith cease to
be payable to the registered Holder on such Regular Record Date, and may be paid
to the Person in whose name this Note (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Trustee, notice whereof shall be
given to the Holder of this Note not less than 10 days prior to such Special
Record Date, or may be paid at any time in any other lawful manner, as more
fully provided in such Indenture.
Payment of interest, the Cash Amount, and, if applicable, delivery of the
Equivalent Share Amount, if any, with respect to this Note shall be made at the
office or agency of the Company maintained for that purpose in the Borough of
Manhattan, The City of New York, in such coin or currency of the United States
of America as at the time of payment is legal tender for payment of public and
private debts. The Company shall, or shall cause the Calculation Agent to,
deliver U.S. Dollars (or Portfolio Securities, if the Holder of this Note
exercises the Right to Receive the Equivalent Share Amount) to the Trustee for
delivery to the Holder of this Note.
As used herein:
"Business Day" means any day other than a Saturday or Sunday that is
neither a legal holiday nor a day on which banking institutions are authorized
or required by law or regulation to close in The City of New York and that is a
Trading Day.
"Calculation Agent" means Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated (including any successor thereto).
"Cash Amount" means, with respect to this Note, an amount in U.S. dollars
determined in accordance with the following formula, subject to certain
adjustments: (i) if the Final Portfolio Value is greater than or equal to the
Portfolio Value Cap, each Note will be redeemed for an amount equal to the
Portfolio Value Cap and (ii) if the Final Portfolio Value is less than the
Portfolio Value Cap, each Note will be redeemed for the Final Portfolio Value.
"Closing Price" for any Trading Day for any security listed on a national
securities exchange or traded on NASDAQ, as applicable, means the official
closing price or the last reported sale price (as of 4:00 p.m. in the City of
New York) on such day as reported by the principal trading market. If for any
reason neither the official closing price nor the last reported sale price is
available for any security, the applicable Closing Price for such security on
such day
2
shall be the mean, as determined by the Calculation Agent, of the bid prices for
such security obtained from as many dealers in such security, but not exceeding
three, as will make such bid prices available to the Calculation Agent.
"Determination Date" means the fifth Trading Day preceding the Maturity
Date or, if there is a Market Disruption Event with respect to any Portfolio
Security on such day, the Determination Date will be the immediately succeeding
Trading Day on which no Market Disruption Event with respect to any Portfolio
Security shall have occurred; provided that the Determination Date will be no
later than the third Trading Day preceding the Maturity Date, notwithstanding
the occurrence of a Market Disruption Event with respect to any Portfolio
Security on such Trading Day (each, an "Affected Portfolio Security"); and
provided further that, with respect to each such Affected Portfolio Security,
(i) the Calculation Agent will determine its good faith estimate of the Closing
Price for each such Affected Portfolio Security that would have prevailed on
such Trading Day but for such Market Disruption Event and (ii) for holders of
Notes that have not otherwise elected to receive the Equivalent Share Amount,
the Company may, in its sole discretion, deliver to such holders on the Maturity
Date the Equivalent Share Amount attributable to such Affected Portfolio
Security per Note in lieu of delivering the portion of the Cash Amount
attributable to such Affected Portfolio Security per Note.
"Equivalent Share Amount" means, with respect to this Note and as
determined by the Calculation Agent, (i) if the Final Portfolio Value is less
than or equal to the Portfolio Value Cap, the number of shares of each Portfolio
Security equal to the Multiplier for such Portfolio Security on such date; or
(ii) if the Final Portfolio Value is greater than the Portfolio Value Cap, the
number of shares of each Portfolio Security equal to the Multiplier for such
Portfolio Security on such date multiplied by a fraction, the numerator of which
is the Portfolio Value Cap and the denominator of which is the Final Portfolio
Value; provided, however, that the Company will pay cash in lieu of delivering
fractional shares, in an amount as determined by the Calculation Agent. Unless
the Calculation Agent otherwise determines that it is not practicable to deliver
the Equivalent Share Amount, the Equivalent Share Amount will be delivered to
the holder on the Maturity Date; provided that in the event of certain Market
Disruption Events, the delivery of the Portfolio Securities may be delayed until
after the Maturity Date.
"Final Portfolio Value", as determined by the Calculation Agent, means the
sum of the Closing Prices of the Portfolio Securities on the Determination Date,
each as multiplied by the Multiplier for such Portfolio Security; provided,
however, that in the event of the occurrence of certain corporate events
affecting any Portfolio Security, the method of calculating the Final Portfolio
Value may be adjusted by the Calculation Agent as set forth herein.
"Initial Portfolio Value" equals $1,000.
"Issue Price" means an amount equal to $1,000 per $1,000 principal amount
of each Note evidenced hereby.
"Market Disruption Event" means:
3
(i) a suspension, absence (including the absence of an official closing
price, if applicable) or material limitation of trading of any Portfolio
Security on NASDAQ or other relevant securities exchanges for more than
two hours of trading or during the one-half hour period preceding or at
the close of trading in such market; or the suspension or material
limitation on the primary market for trading in options contracts related
to any Portfolio Security, if available, during the one-half hour period
preceding or at the close of trading in the applicable market in each case
as determined by the Calculation Agent in its sole discretion; and
(ii) a determination by the Calculation Agent in its sole discretion that
the event described in clause (i) above materially interfered with the
ability of the Company or any of its affiliates to unwind all or a
material portion of the hedge with respect to the Notes or to purchase any
Portfolio Security for the purposes of delivering the Equivalent Share
Amount.
For the purposes of determining whether a Market Disruption Event has occurred:
(1) a limitation on the hours or number of days of trading will not constitute a
Market Disruption Event if it results from an announced change in the regular
business hours of the relevant exchange, (2) a decision to permanently
discontinue trading in any relevant option contract will not constitute a Market
Disruption Event, (3) limitations pursuant to any rule or regulation enacted or
promulgated by NASDAQ or other relevant securities exchanges (or other
regulatory organization with jurisdiction over NASDAQ or other relevant
securities exchanges, as applicable) on trading during significant market
fluctuations will constitute a suspension or material limitation of trading in
any Portfolio Security, (4) a suspension of trading in an options contract on
any Portfolio Security by the primary securities market trading in such options,
if available, by reason of (x) a price change exceeding limits set by such
securities exchange or market, (y) an imbalance of orders relating to such
contracts or (z) a disparity in bid and ask quotes relating to such contracts
will constitute a suspension or material limitation of trading in options
contracts related to such Portfolio Security and (5) a suspension, absence or
material limitation of trading on the primary securities market on which options
contracts related to any Portfolio Security are traded will not include any time
when such securities market is itself closed for trading under ordinary
circumstances.
"Market Price" for any security listed on a national securities exchange
or traded on NASDAQ means (i) at any time prior to the availability of a Closing
Price for such security on such day, the last reported sale price at such time
as reported by the principal trading market and (ii) at any time after the
availability of a Closing Price for such security on such day, the Closing
Price. If for any reason the last reported sale price is not available at any
time prior to the availability of a Closing Price for any security, the
applicable Market Price for such security on such day shall be the mean, as
determined by the Calculation Agent, of the bid prices for such security
obtained from as many dealers in such security, but not exceeding three, as will
make such bid prices available to the Calculation Agent.
4
"Multiplier" means, initially, 7.0541 in the case of the Intuit Stock,
17.4483 in the case of the CKS Stock and 7.0304 in the case of the CNET Stock.
The Multiplier for each Portfolio Security is subject to adjustment by the
Calculation Agent as set forth elsewhere herein.
"NASDAQ" means the Nasdaq National Market System.
"Portfolio Securities" means common stock of Intuit Inc., par value $0.01,
common stock of CKS Group, Inc., par value $0.001, and common stock of CNET,
Inc., par value $0.0001.
"Portfolio Value Cap" equals $1600 per Note.
"Trading Day " means a day on which the New York Stock Exchange, the
American Stock Exchange and NASDAQ are open for trading, as determined by the
Calculation Agent.
The Holder of this Note will be entitled, upon completion by the holder
and delivery to the Company and the Calculation Agent of an Official Notice of
Exercise of Right to Receive Equivalent Share Amount (in the form of Annex A
attached hereto) prior to 11:00 a.m., New York City time on or prior to the
fifteenth Business Day preceding the Maturity Date, to elect to receive, with
respect to any of the Notes evidenced hereby, the Equivalent Share Amount at
maturity, in lieu of the Cash Amount, unless it is not reasonably practicable at
such time, in the opinion of the Calculation Agent, to obtain such Equivalent
Share Amount for all Notes with respect to which Holders have elected to receive
the Equivalent Share Amount at maturity, in which case the Cash Amount will be
paid on the Maturity Date. If the Calculation Agent determines that it is not
reasonably practicable to obtain the Equivalent Share Amount, the Calculation
Agent will provide written notice to the Trustee at its New York office and to
The Depository Trust Company, or any successor depositary ("DTC"), on which
notice the Trustee and DTC may conclusively rely, of such determination on or
prior to 4:00 p.m. on the second Business Day immediately preceding the Maturity
Date.
Prior to 9:30 a.m. on the first Business Day immediately preceding the
Maturity Date, the Company shall cause the Calculation Agent to provide written
notice to the Trustee at its New York office and to DTC , on which notice the
Trustee and DTC may conclusively rely, (i) of its receipt of any such "Official
Notice of Instruction to Deliver the Equivalent Share Amount," (ii) of the
Company's determination to deliver the Equivalent Share Amount (which
determination shall be deemed made unless the Calculation Agent has determined
as aforesaid that it is not reasonably practicable to obtain the Equivalent
Share Amount) and (iii) if Portfolio Securities are to be delivered, of the
number of shares of each Portfolio Security per Note and of the amount of any
cash to be paid in lieu of fractional Portfolio Securities.
The Company shall, or shall cause the Calculation Agent to, deliver such
Portfolio Securities or cash to the Trustee for delivery to the Holders.
The Multiplier with respect to any Portfolio Security will be adjusted by
the Calculation Agent as follows:
5
1. If a Portfolio Security is subject to a stock split or reverse
stock split, then once such split has become effective, the Multiplier
relating to such Portfolio Security will be adjusted to equal the product
of the prior Multiplier and the number of shares issued in such stock
split or reverse stock split with respect to one share of such Portfolio
Security.
2. If a Portfolio Security is subject to a stock dividend (issuance
of additional shares of the Portfolio Security) that is given ratably to
all holders of shares of common stock of the issuer of such Portfolio
Security, then once such Portfolio Security is trading ex-dividend, the
Multiplier will be adjusted so that the new Multiplier shall equal the
prior Multiplier plus the product of (i) the number of shares of such
Portfolio Security issued with respect to one share of such Portfolio
Security and (ii) the prior Multiplier.
3. There will be no adjustments to the Multipliers to reflect cash
dividends or distributions paid with respect to a Portfolio Security other
than distributions described in clause (v) of paragraph 5 below and
Extraordinary Dividends as described below. A cash dividend or other
distribution with respect to a Portfolio Security will be deemed to be an
"Extraordinary Dividend" if such dividend or other distribution exceeds
the immediately preceding non-Extraordinary Dividend for such Portfolio
Security by an amount equal to at least 10% of the Closing Price of such
Portfolio Security on the Trading Day preceding the day for the payment of
such Extraordinary Dividend (the "ex-dividend date"). If an Extraordinary
Dividend occurs with respect to a Portfolio Security, the Multiplier with
respect to such Portfolio Security will be adjusted on the ex-dividend
date with respect to such Extraordinary Dividend so that the new
Multiplier will equal the product of (i) the then current Multiplier, and
(ii) a fraction, the numerator of which is the Closing Price on the
Trading Day preceding the ex-dividend date, and the denominator of which
is the amount by which the Closing Price on the Trading Day preceding the
ex-dividend date exceeds the Extraordinary Dividend Amount. The
"Extraordinary Dividend Amount" with respect to an Extraordinary Dividend
for a Portfolio Security will equal (i) in the case of cash dividends or
other distributions that constitute quarterly dividends, the amount per
share of such Extraordinary Dividend minus the amount per share of the
immediately preceding non-Extraordinary Dividend for any Portfolio
Security or (ii) in the case of cash dividends or other distributions that
do not constitute quarterly dividends, the amount per share of such
Extraordinary Dividend. To the extent an Extraordinary Dividend is not
paid in cash, the value of the non-cash component will be determined by
the Calculation Agent, whose determination shall be conclusive. A
distribution on any Portfolio Security described in clause (v) of
paragraph 5 below that also constitutes an Extraordinary Dividend shall
cause an adjustment to the Multiplier pursuant only to clause (v) of
paragraph 5.
4. If an issuer of one of the Portfolio Securities issues
transferable rights or warrants to all holders of such Portfolio Security
to subscribe for or purchase such Portfolio Security (including new or
existing rights to purchase such Portfolio Security pursuant to a
shareholders rights plan or arrangement, once a triggering event shall
have occurred thereunder), then the method of determining the amount
payable at maturity for
6
each Note will be adjusted to provide that each holder of Notes will
receive at maturity, in respect of the principal amount of each Note, in
addition to the Cash Amount or Equivalent Share Amount, cash in an amount
equal to the Rights Value (as defined below) of such Portfolio Security
plus accrued interest thereon from the Trading Day immediately following
receipt by holders of such Portfolio Security of such rights or warrants
to the maturity date at LIBOR (as defined below), reset monthly on the
first Trading Day of each month. The "Rights Value" shall be the Closing
Prices of such rights or warrants on the Trading Day immediately following
receipt by holders of such Portfolio Security of such rights or warrants.
"LIBOR" shall be the rate for deposits in U.S. Dollars for a period of one
month which appears on the Reuters Screen ISDA Page as of 11:00 a.m.,
London time, on the day that is two Trading Days preceding the reset date,
or in the case of the initial determination of LIBOR, on the Trading Day
immediately preceding the date on which the holders of such Portfolio
Security received such rights, warrants, cash or other property.
5. If (i) there occurs any reclassification or change of any
Portfolio Security, (ii) the issuer of such Portfolio Security, or any
surviving entity or subsequent surviving entity of the issuer of such
Portfolio Security (a "Successor Entity") has been subject to a merger,
combination or consolidation and is not the surviving entity, (iii) any
statutory exchange of securities of any issuer of the Portfolio Securities
or any Successor Entity with another corporation occurs (other than
pursuant to clause (ii) above), (iv) any issuer of the Portfolio
Securities is liquidated, (v) any issuer of the Portfolio Securities
issues to all of its shareholders equity securities of an issuer other
than such issuer of the Portfolio Securities (other than in a transaction
described in clauses (ii), (iii) or (iv) above) (a "Spin-off Event") or
(vi) a tender or exchange offer is consummated for all the outstanding
shares of any issuer of the Portfolio Securities (any such event in
clauses (i) through (vi) a "Reorganization Event"), the method of
determining the amount payable at maturity for each Note will be adjusted
to provide that each holder of Notes will receive at maturity, in respect
of the principal amount of each Note and in lieu of the Cash Amount, cash
in an amount equal to the Transaction Value (as defined below). "Exchange
Property" means the securities, cash or any other assets distributed in
any such Reorganization Event, including, in the case of a Spin-off Event,
the share of such Portfolio Securities with respect to which the spun-off
security was issued. "Transaction Value" means (i) for any cash received
in any such Reorganization Event, an amount equal to (a) the amount of
cash received per share of such Portfolio Security plus accrued interest
thereon at LIBOR reset monthly for the period beginning on the date such
cash is distributed to the holders of such Portfolio Security to but
excluding the Maturity Date, multiplied by (b) the Multiplier in effect on
the date all of the holders of shares of the relevant issuer of the
Portfolio Securities have agreed or have become irrevocably obligated to
exchange such shares, (ii) for any property other than cash or securities
received in any such Reorganization Event, the market value (as determined
by the Calculation Agent) of such Exchange Property received for each
share of such Portfolio Security at the date of the receipt of such
Exchange Property multiplied by the then current Multiplier and (iii) for
any security received in any such Reorganization Event, an
7
amount equal to the Closing Price per share of such security on the
Determination Date multiplied by the quantity of such security received
for each share of such Portfolio Security multiplied by the then current
Multiplier.
6. If there occurs a cash tender offer for at least 25% but less
than all of any Portfolio Security then outstanding at a price per share
in excess of the Closing Price of such Portfolio Security on the date such
offer is announced (the "Announcement Date"), then the method of
determining the amount payable at maturity for each Note will be adjusted
to provide that each holder of Notes will receive at maturity, in respect
of the applicable Portfolio Security, in lieu of the Cash Amount or
Equivalent Share Amount attributable to such Portfolio Security, cash in
an amount equal to the Tender Value. "Tender Value" means an amount equal
to the product of (a) the sum of the Closing Price of such Portfolio
Security on the Trading Day immediately following the Announcement Date
plus accrued interest thereon at LIBOR reset monthly for the period
beginning on the fourth Trading Day following the Announcement Date to but
excluding the Maturity Date, multiplied by (b) the Multiplier for such
Portfolio Security in effect on the Announcement Date.
For purposes of paragraph 5 above, in the case of a consummated tender or
exchange offer for all Exchange Property of a particular type, Exchange Property
shall be deemed to include the amount of cash or other property paid by the
offeror in the tender or exchange offer with respect to such Exchange Property
(in an amount determined on the basis of the rate of exchange in such tender or
exchange offer). In the event of a tender or exchange offer with respect to
Exchange Property in which an offeree may elect to receive cash or other
property, Exchange Property shall be deemed to include the kind and amount of
cash and other property received by offerees who elect to receive cash.
No adjustments to the Multiplier will be required unless such Multiplier
adjustment would require a change of at least 0.1% in the Multiplier then in
effect. The Multiplier resulting from any of the adjustments specified above
will be rounded to the nearest one thousandth with five ten-thousandths being
rounded upward.
No adjustments to the Multiplier or to the amount payable at maturity of
the Notes will be required other than those specified above. However, the
Company may, at its sole discretion, cause the Calculation Agent to make
additional adjustments to the Multiplier to reflect changes occurring in
relation to any Portfolio Security or any other Exchange Property in other
circumstances where the Company determines that it is appropriate to reflect
such changes. The required adjustments specified above do not cover all events
that could affect the Market Price or Closing Price, as applicable, of such
Portfolio Security, including, without limitation, a partial tender or exchange
offer for such Portfolio Security.
The Calculation Agent shall be solely responsible for the determination
and calculation of any adjustments to the Multiplier and of any related
determinations and calculations with respect to any distributions of stock,
other securities or other property or assets (including cash) in
8
connection with any corporate event described in paragraph 5 above, and its
determinations and calculations with respect thereto shall be conclusive.
The Calculation Agent will provide information as to any adjustments to
the Multiplier upon written request by any holder of the Notes.
All percentages resulting from any calculation on the Notes will be
rounded to the nearest one hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upwards (e.g., 9.876545% (or
.09876545) would be rounded to 9.87655% (or .0987655)), and all U.S. Dollar
amounts used in or resulting from such calculation will be rounded to the
nearest cent with one-half cent being rounded upwards.
The Company, by its sale of this Note and every Holder of this Note (and
any successor Holder of this Note), by its respective purchase hereof, hereby
agree (in the absence of an administrative determination or judicial ruling to
the contrary):
1. To characterize this Note for all tax purposes as an investment unit
consisting of the following components (the "Components"): (i) a
debt instrument of the Company (the "Debt Instrument") with a fixed
principal amount unconditionally payable on the Maturity Date equal
to the Principal Amount of this Note and bearing stated interest at
the Interest Rate and (ii) a contract (the "Forward Contract")
pursuant to which the Holder agrees to use the principal payment due
on the Debt Instrument to make a payment to the Company in exchange
for the right to receive the Cash Amount payable at maturity or the
Equivalent Share Amount, which treatment will require, among other
things, each Holder that is subject to United States Federal income
tax in connection with its ownership of the Notes to include
currently in income payments denominated as interest that are made
with respect to this Note in accordance with such Holder's regular
method of tax accounting;
2. In the case of purchases of Notes in connection with the original
issuance thereof, to assign an amount equal to 102.24% of the entire
initial purchase price of a Note (i.e., the Issue Price of the
Notes) to the Debt Instrument component and to assign an amount
equal to 2.24% of the Issue Price to the Forward Contract component;
and
3. To file all United States Federal, state and local income, franchise
and estate tax returns consistent with the treatment of each Note as
a unit consisting of the Debt Instrument and the Forward Contract
(in the absence of an administrative determination or judicial
ruling to the contrary).
General
Unless the certificate of authentication hereon has been executed by or on
behalf of The Chase Manhattan Bank, the Trustee for this Note under the
Indenture, or its successor thereunder, by the manual signature of one of its
authorized officers, this Note shall not be entitled to any benefit under the
Indenture or be valid or obligatory for any purpose.
9
This Note is one of a duly authorized issue of Securities (hereinafter
called the "Securities") of the Company designated as its Medium-Term Notes,
Series B (the "Notes"). The Securities are issued and to be issued under an
indenture (the "Indenture") dated as of October 1, 1993, as amended and
supplemented, between the Company and The Chase Manhattan Bank, as trustee
(herein called the "Trustee," which term includes any successor Trustee under
the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights thereunder of
the Company, the Trustee and the Holders of the Notes and the terms upon which
the Notes are to be authenticated and delivered. The terms of individual Notes
may vary with respect to interest rates or interest rate formulas, issue dates,
maturity, redemption, repayment, currency of payment and otherwise as provided
in the Indenture.
The Notes are issuable only in registered form without coupons in
denominations, unless otherwise specified above, of $1,000 and integral
multiples thereof. References to payment "per Note" refer to each $1,000
principal amount of each Note evidenced hereby. As provided in the Indenture and
subject to certain limitations therein set forth, the Notes are exchangeable for
a like aggregate principal amount of Notes as requested by the Holder
surrendering the same. If (x) the Depository is at any time unwilling or unable
to continue as depository and a successor depository is not appointed by the
Company within 60 days, (y) the Company executes and delivers to the Trustee a
Company Order to the effect that this Note shall be exchangeable or (z) an Event
of Default has occurred and is continuing with respect to the Notes, this Note
shall be exchangeable for Notes in definitive form of like tenor and of an equal
aggregate principal amount, in authorized denominations. Such definitive Notes
shall be registered in such name or names as the Depository shall instruct the
Trustee. If definitive Notes are so delivered, the Company may make such changes
to the form of this Note as are necessary or appropriate to allow for the
issuance of such definitive Notes.
This Note is not subject to any sinking fund.
This Note is not subject to repayment at the option of the Holder prior to
its Maturity Date.
If an Event of Default (as defined in the Indenture) with respect to the
Notes shall occur and be continuing, the principal of all the Notes may be
declared due and payable in the manner and with the effect provided in the
Indenture; provided, however, that in case an Event of Default with respect to
any Notes shall have occurred and be continuing, the amount payable to a
beneficial owner of a Note upon any acceleration permitted by the Notes will be
determined by the Calculation Agent and will be equal to the Cash Amount
determined as though the Determination Date were the date of acceleration of the
Notes, as provided above, plus any accrued but unpaid interest to but not
including the date of acceleration.
In case of default in (i) payment of the Notes (whether at their stated
maturity or upon acceleration), from and after the maturity date the Notes shall
bear interest, payable upon demand of the beneficial owners thereof, at the rate
of 5% per annum (to the extent that payment
10
of such interest shall be legally enforceable) on the unpaid amount due and
payable on such date in accordance with the terms of the Notes to the date
payment of such amount has been made or duly provided for, or (ii) delivery of
the Equivalent Share Amount of the Notes at their stated maturity, from and
after the maturity date the Notes shall bear interest, payable upon demand of
the beneficial owners thereof, at the rate of 5% per annum (to the extent that
payment of such interest shall be legally enforceable) on the Cash Amount
otherwise payable on such date in accordance with the terms of the Notes to the
date payment of such Cash Amount has been made or duly provided for.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of 66-2/3% in aggregate principal amount of the
Securities at the time Outstanding, as defined in the Indenture, of each series
affected thereby. The Indenture also contains provisions permitting the Holders
of specified percentages in aggregate principal amount of the Securities of each
series at the time Outstanding, on behalf of the Holders of all the Securities
of each series, to waive compliance by the Company with certain provisions of
the Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Note shall be
conclusive and binding upon such Holder and upon all future Holders of this Note
and of any Note issued upon the registration of transfer hereof or in exchange
herefor or in lieu hereof whether or not notation of such consent or waiver is
made upon this Note.
No reference herein to the Indenture and no provision of this Note or of
the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the interest on, and the Cash Amount or
Equivalent Share Amount, with respect to this Note and any interest on any
overdue amount thereof at the time, place and rate, and in the coin or currency,
herein prescribed.
As provided in the Indenture and subject to certain limitations set forth
therein and on the face hereof, the transfer of this Note may be registered on
the Security Register of the Company, upon surrender of this Note for
registration of transfer at the office or agency of the Company in the Borough
of Manhattan, The City of New York, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Company duly executed
by, the Holder hereof or by his attorney duly authorized in writing, and
thereupon one or more new Notes of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this
11
Note is registered as the owner hereof for all purposes, whether or not this
Note be overdue, and neither the Company, the Trustee nor any such agent shall
be affected by notice to the contrary.
The Indenture and the Notes shall be governed by and construed in
accordance with the laws of the State of New York.
All terms used in this Note which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
12
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: August 18, 1998
CERTIFICATE OF AUTHENTICATION Xxxxxxx Xxxxx & Co., Inc.
This is one of the Securities of the [Copy of Seal]
series designated therein referred to
in the within-mentioned Indenture.
The Chase Manhattan Bank, as Trustee By:
Treasurer
By: Attest:
Authorized Officer Secretary
13
ANNEX A
OFFICIAL NOTICE OF EXERCISE OF RIGHT
TO RECEIVE EQUIVALENT SHARE AMOUNT
7% Stock Portfolio Linked Medium-Term Notes due August 18, 2000
(Linked to the performance of the Common Stock of Intuit Inc.,
CKS Group, Inc. and CNET, Inc.)
Dated: [On or prior to the fifteenth Business Day prior to August 18,
2000]
Xxxxxxx Xxxxx & Co., Inc.
World Financial Center
Xxxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Fax No.: (000) 000-0000
(Attn: Treasury)
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, as Calculation Agent
World Financial Center
Xxxxx Xxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Fax No.: (000) 000-0000
(Attn: Operations (Xxxxxxx Xxxxxxxx))
The Chase Manhattan Bank
000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax No.: (000) 000-0000
(Attn: Corporate Trust Department)
Dear Sirs:
The undersigned holder of the 7% Stock Portfolio Linked Medium-Term Notes
due August 18, 2000 (Linked to the performance of the Common Stock of Intuit
Inc., CKS Group, Inc. and CNET, Inc.) of Xxxxxxx Xxxxx & Co., Inc. (the "Notes")
hereby irrevocably elects to exercise with respect to the number of Notes
indicated below, as of the date hereof, provided that such day is prior to the
fifteenth Business Day prior to August 18, 2000, the Right to Receive the
Equivalent Share Amount as described in Pricing Supplement dated August 11, 1998
(the
14
"Pricing Supplement") to the Prospectus Supplement and Prospectus dated July 30,
1998. Capitalized terms not defined herein have the meanings given to such terms
in the Pricing Supplement. Please date and acknowledge receipt of this notice in
the place provided below on the date of receipt, and fax a copy to the fax
number indicated, whereupon the Company will deliver Portfolio Securities, in
accordance with the terms of the Notes described in the Pricing Supplement.
Very truly yours,
_____________________________
[Name of Holder]
By:__________________________________________
[Title]
_____________________________________________
[Fax No.]
$____________________________________________
Number of Notes surrendered for exercise of the Right to Receive the
Equivalent Share Amount
If you want the Portfolio Securities made out in another person's name,
fill in the form below:
_____________________________________________
(Insert person's soc. sec. or tax ID no.)
_____________________________________________
(Print or type person's name, address and zip code)
Date: _______________________________
Your Signature:______________________________________
15
Receipt of the above Official Notice of
Exchange is hereby acknowledged.
XXXXXXX XXXXX & CO., INC., as Issuer
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED,
as Calculation Agent
By: THE CHASE MANHATTAN BANK,
as Trustee
By: _________________________________________________
Name:
Title:
Date and time of acknowledgment ____________________
16
ASSIGNMENT/TRANSFER FORM
FOR VALUE RECEIVED the undersigned registered Holder hereby sell(s),
assign(s) and transfer(s) unto
(insert Taxpayer Identification No.)
(Please print or typewrite name and address including postal zip code of
assignee)
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing _______________________ attorney to transfer said Note on the books
of the Company with full power of substitution in the premises.
Dated: _____________________
NOTICE: The signature of the registered Holder to
this assignment must correspond with the name as
written upon the face of the within instrument in
every particular, without alteration or
enlargement or any change whatsoever.
17
