Exhibit 8
MOTOROLA, INC.
AND
FIRST UNION TRUST COMPANY, NATIONAL ASSOCIATION,
AS PURCHASE CONTRACT AGENT
PURCHASE CONTRACT AGREEMENT
Dated as of October 31, 2001
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF
GENERAL APPLICATION
SECTION 1.1 Definitions................................................. 1
SECTION 1.2 Compliance Certificates and Opinions........................ 15
SECTION 1.3 Form of Documents Delivered to Agent........................ 15
SECTION 1.4 Acts of Holders; Record Dates............................... 16
SECTION 1.5 Notices..................................................... 17
SECTION 1.6 Notice to Holders; Waiver................................... 18
SECTION 1.7 Effect of Headings and Table of Contents.................... 19
SECTION 1.8 Successors and Assigns...................................... 19
SECTION 1.9 Separability Clause......................................... 19
SECTION 1.10 Benefits of Agreement....................................... 19
SECTION 1.11 Governing Law............................................... 19
SECTION 1.12 Legal Holidays.............................................. 19
SECTION 1.13 Counterparts................................................ 20
SECTION 1.14 Inspection of Agreement..................................... 20
ARTICLE II
CERTIFICATE FORMS
SECTION 2.1 Forms of Certificates Generally............................. 20
SECTION 2.2 Form of Agent's Certificate of Authentication............... 21
ARTICLE III
THE UNITS
SECTION 3.1 Title and Terms; Denominations.............................. 22
SECTION 3.2 Rights and Obligations Evidenced by the Certificates........ 22
SECTION 3.3 Execution, Authentication, Delivery and Dating.............. 23
SECTION 3.4 Temporary Certificates...................................... 24
SECTION 3.5 Registration; Registration of Transfer and Exchange......... 25
SECTION 3.6 Book-Entry Interests........................................ 26
SECTION 3.7 Notices to Holders.......................................... 27
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SECTION 3.8 Appointment of Successor Clearing Agency.................... 27
SECTION 3.9 Definitive Certificates..................................... 27
SECTION 3.10 Mutilated, Destroyed, Lost and Stolen Certificates.......... 28
SECTION 3.11 Persons Deemed Owners....................................... 29
SECTION 3.12 Cancellation................................................ 29
SECTION 3.13 Establishment of Stripped Units............................. 30
SECTION 3.14 Reestablishment of Normal Units............................. 32
SECTION 3.15 Transfer of Collateral upon Occurrence of Termination Event. 33
SECTION 3.16 No Consent to Assumption.................................... 34
ARTICLE IV
THE NOTES
SECTION 4.1 Payment of Interest; Rights to Interest Payments Preserved;
Notice...................................................... 34
SECTION 4.2 Notice and Voting........................................... 35
SECTION 4.3 Tax Event Redemption........................................ 35
ARTICLE V
THE PURCHASE CONTRACTS; THE REMARKETING
SECTION 5.1 Purchase of Shares of Common Stock.......................... 36
SECTION 5.2 Contract Adjustment Payments................................ 38
SECTION 5.3 Deferral of Contract Adjustment Payments.................... 39
SECTION 5.4 Payment of Purchase Price: Remarketing...................... 41
SECTION 5.5 Issuance of Shares of Common Stock.......................... 46
SECTION 5.6 Adjustment of Settlement Rate............................... 47
SECTION 5.7 Notice of Adjustments and Certain Other Events.............. 53
SECTION 5.8 Termination Event; Notice................................... 54
SECTION 5.9 Early Settlement............................................ 55
SECTION 5.10 Early Settlement Upon Merger................................ 56
SECTION 5.11 Charges and Taxes........................................... 58
SECTION 5.12 No Fractional Shares........................................ 58
ARTICLE VI
REMEDIES
SECTION 6.1 Unconditional Right of Holders to Purchase Common Stock..... 59
SECTION 6.2 Restoration of Rights and Remedies.......................... 59
SECTION 6.3 Rights and Remedies Cumulative.............................. 60
SECTION 6.4 Delay or Omission Not Waiver................................ 60
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SECTION 6.5 Undertaking for Costs....................................... 60
SECTION 6.6 Waiver of Stay or Extension Laws............................ 60
ARTICLE VII
THE AGENT
SECTION 7.1 Certain Duties, Rights and Immunities....................... 61
SECTION 7.2 Notice of Default........................................... 63
SECTION 7.3 Certain Rights of Agent..................................... 63
SECTION 7.4 Not Responsible for Recitals, Etc........................... 64
SECTION 7.5 May Hold Units.............................................. 64
SECTION 7.6 Money Held in Custody....................................... 64
SECTION 7.7 Compensation and Reimbursement.............................. 64
SECTION 7.8 Corporate Agent Required; Eligibility....................... 65
SECTION 7.9 Resignation and Removal; Appointment of Successor........... 66
SECTION 7.10 Acceptance of Appointment by Successor...................... 67
SECTION 7.11 Merger, Conversion, Consolidation or Succession to Business. 67
SECTION 7.12 Preservation of Information; Communications to Holders...... 68
SECTION 7.13 Failure to Act.............................................. 68
SECTION 7.14 No Obligations of Agent..................................... 69
SECTION 7.15 Tax Compliance.............................................. 69
ARTICLE VIII
SUPPLEMENTAL AGREEMENTS
SECTION 8.1 Supplemental Agreements Without Consent of Holders.......... 70
SECTION 8.2 Supplemental Agreements with Consent of Holders............. 70
SECTION 8.3 Execution of Supplemental Agreements........................ 71
SECTION 8.4 Effect of Supplemental Agreements........................... 72
SECTION 8.5 Reference to Supplemental Agreements........................ 72
ARTICLE IX
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.1 Covenant Not to Merge, Consolidate, Sell or Convey Property
Except Under Certain Conditions............................. 72
SECTION 9.2 Rights and Duties of Successor Corporation.................. 73
SECTION 9.3 Opinion of Counsel Given to Agent........................... 73
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ARTICLE X
COVENANTS
SECTION 10.1 Performance Under Purchase Contracts........................ 74
SECTION 10.2 Maintenance of Office or Agency............................. 74
SECTION 10.3 Company to Reserve Common Stock............................. 74
SECTION 10.4 Covenants as to Common Stock................................ 75
SECTION 10.5 Statements of Officer of the Company as to Default.......... 75
EXHIBITS
EXHIBIT A Form of Normal Units Certificate
EXHIBIT B Form of Stripped Units Certificate
EXHIBIT C Instruction from Purchase Contract Agent to Collateral Agent
EXHIBIT D Instruction to Purchase Contract Agent
EXHIBIT E Notice to Settle By Separate Cash
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PURCHASE CONTRACT AGREEMENT, dated as of October 31, 2001, between
Motorola, Inc., a Delaware corporation (the "Company"), and First Union Trust
Company, National Association, a national banking association, acting as
purchase contract agent for the Holders of Units from time to time (the
"Agent").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the Units.
All things necessary to make the Purchase Contracts, when the
Certificates are executed by the Company and authenticated, executed on behalf
of the Holders and delivered by the Agent, as provided in this Agreement, the
valid obligations of the Company, and to constitute this Agreement a valid
agreement of the Company, in accordance with its terms, have been done.
WITNESSETH:
For and in consideration of the premises and the purchase of the Units
by the Holders thereof, it is mutually agreed as follows:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.1 DEFINITIONS.
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular, and
nouns and pronouns of the masculine gender include the feminine and neuter
genders;
(b) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States;
(c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision; and
(d) the following terms have the meanings given to them in this
Section 1.1(d):
"Act," when used with respect to any Holder, has the meaning
specified in Section 1.4.
"Affiliate" has the same meaning as given to that term in Rule 405 of
the Securities Act or any successor rule thereunder.
"Agent" means the Person named as the "Agent" in the first paragraph
of this instrument until a successor Agent shall have become such pursuant
to the applicable provisions of this Agreement, and thereafter "Agent"
shall mean such Person.
"Agent-purchased Treasury Consideration" has the meaning specified in
Section 5.4(b)(i).
"Agreement" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions
hereof.
"Applicable Market Value" has the meaning specified in Section 5.1(c).
"Applicable Ownership Interest" means, with respect to a Normal Unit
and the Treasury Securities in the Treasury Portfolio, (A) a 1/20, or 5.0%,
undivided beneficial ownership interest in a $1,000 principal or interest
amount of a principal or interest strip in a U.S. Treasury security
included in such Treasury Portfolio which matures on or prior to November
16, 2004 and (B) for the scheduled interest Payment Date on the Notes that
occurs on the Stock Purchase Date, in the case of a successful remarketing,
or for each scheduled interest Payment Date on the Notes that occurs after
the Tax Event Redemption Date and on or before the Stock Purchase Date, in
the case of a Tax Event Redemption, a 5.0% undivided beneficial ownership
interest in a $1,000 principal or interest of a principal or interest strip
in a U.S. Treasury security included in the Treasury Portfolio that matures
on or prior to that interest Payment Date or Dates.
"Applicants" has the meaning specified in Section 7.12(b).
"Bankruptcy Code" means Title 11 of the United States Code, or any
other law of the United States that from time to time provides a uniform
system of bankruptcy laws.
"Beneficial Owner" means, with respect to a Book-Entry Interest, a
Person who is the beneficial owner of such Book-Entry Interest as reflected
on the books of the Clearing Agency or on the books of a Person maintaining
an account with
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such Clearing Agency (directly as a Clearing Agency Participant or as an
indirect participant, in each case in accordance with the rules of such
Clearing Agency).
"Board of Directors" means either the Board of Directors of the
Company or the Executive Committee of such Board or any other committee of
such Board duly authorized to act generally or in any particular respect
for the Board hereunder.
"Board Resolution" means (i) a copy of a resolution certified by the
Secretary or the Assistant Secretary of the Company to have been duly
adopted by the Board of Directors and to be in full force and effect on the
date of such certification, (ii) a copy of a unanimous written consent of
the Board of Directors or (iii) a certificate signed by the authorized
officer or officers to whom the Board of Directors has delegated its
authority, and in each case, delivered to the Agent.
"Book-Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 3.6.
"Business Day" means any day that is not a Saturday, Sunday or day on
which banking institutions and trust companies in The State of New York,
The City of Wilmington, Delaware or The City of Charlotte, North Carolina
or at a place of payment are authorized or required by law, regulation or
executive order to close.
"Capital Stock" means any and all shares, interests, rights to
purchase, warrants, options, participations or other equivalents of or
interests in (however designated, whether voting or non-voting) corporate
stock or similar interests in other types of entities.
"Cash Merger" has the meaning set forth in Section 5.10.
"Cash Settlement" has the meaning set forth in Section 5.4(a).
"Certificate" means a Normal Units Certificate or a Stripped Units
Certificate.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as a
depositary for the Units and in whose name, or in the name of a nominee of
that organization, shall be registered a Global Certificate and which shall
undertake to effect book-entry transfers and pledges of the Units.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the
Clearing
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Agency effects book-entry transfers and pledges of securities deposited
with the Clearing Agency.
"Closing Price" has the meaning specified in Section 5.1(c).
"Collateral" has the meaning specified in Section 2.1(a)(iii) of the
Pledge Agreement.
"Collateral Agent" means The Chase Manhattan Bank, a national banking
corporation, as Collateral Agent under the Pledge Agreement until a
successor Collateral Agent shall have become such pursuant to the
applicable provisions of the Pledge Agreement, and thereafter "Collateral
Agent" shall mean the Person who is then the Collateral Agent thereunder.
"Collateral Substitution" has the meaning specified in Section
3.13(a).
"Common Stock" means the Common Stock, par value $3 per share, of the
Company.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such
pursuant to the applicable provision of this Agreement, and thereafter
"Company" shall mean such successor.
"Constituent Person" has the meaning specified in Section 5.6(b).
"Contract Adjustment Payments" means, in the case of Normal Units and
Stripped Units, the amount payable by the Company in respect of each
Purchase Contract constituting a part of such Unit, equal to 0.50% per year
of the Stated Amount, in each case computed on the basis of a 360-day year
of twelve 30-day months, plus any Deferred Contract Adjustment Payments
accrued pursuant to Section 5.3.
"Corporate Trust Office" means the principal corporate trust office of
the Agent at which, at any particular time, its corporate trust business
shall be administered, which office at the date hereof is located at First
Union Trust Company, National Association, Xxx Xxxxxx Xxxxxx, Xxxxx 000,
000 Xxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000.
"Coupon Rate" means the percentage rate per annum at which each Note
will bear interest initially.
"Current Market Price" has the meaning specified in Section 5.6(a)(8).
"Custodial Agent" means The Chase Manhattan Bank, a national banking
corporation, as Custodial Agent under the Pledge Agreement until a
successor
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Custodial Agent shall have become such pursuant to the applicable
provisions of the Pledge Agreement, and thereafter "Custodial Agent" shall
mean the Person who is then the Custodial Agent thereunder.
"Deferred Contract Adjustment Payments" has the meaning specified in
Section 5.3(a).
"Depositary" means, initially, DTC, until another Clearing Agency
becomes its successor.
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"Early Settlement" has the meaning specified in Section 5.9(a).
"Early Settlement Amount" has the meaning specified in Section 5.9(a).
"Early Settlement Date" has the meaning specified in Section 5.9(a).
"Early Settlement Rate" has the meaning specified in Section 5.9(b).
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time, and
the rules and regulations promulgated thereunder.
"Expiration Date" has the meaning specified in Section 1.4(f).
"Expiration Time" has the meaning specified in Section 5.6(a)(6).
"Failed Remarketing" has the meaning specified in Section 5.4(b)(ii).
"Fair Market Value" with respect to securities distributed in a Spin-
Off means (a) in the case of any Spin-Off that is effected simultaneously
with and Initial Public Offering of such securities, the initial public
offering price of those securities, and (b) in the case of any other Spin-
Off, the average of the Sale Prices of those securities over the first 10
Trading Days after the effective date of such Spin-Off.
"Global Certificate" means a Certificate that evidences all or part of
the Units and is registered in the name of a Depositary or a nominee
thereof.
"Holder" means the Person in whose name the Unit evidenced by a Normal
Units Certificate and/or a Stripped Units Certificate is registered in the
related Normal Units Register and/or the Stripped Units Register, as the
case may be.
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"Indenture" means the Indenture, dated as of May 1, 1995, between the
Company and the Trustee.
"Initial Public Offering" with respect to a Spin-Off means the first
time securities of the same class or type as the securities being
distributed in such Spin-Off are bona fide offered to the public for cash.
"Issuer Order" or "Issuer Request" means a written order or request
signed in the name of the Company by the Chief Executive Officer, the Chief
Financial Officer, the President, any Vice-President, the Treasurer, any
Assistant Treasurer, the Secretary or any Assistant Secretary (or other
officer performing similar functions) of the Company and delivered to the
Agent.
"Last Failed Remarketing" has the meaning specified in Section
5.4(b)(ii).
"Merger Early Settlement" has the meaning specified in Section
5.10(a).
"Merger Early Settlement Amount" has the meaning specified in Section
5.10(b).
"Merger Early Settlement Date" has the meaning specified in Section
5.10(a)(i).
"Non-electing Share" has the meaning specified in Section 5.6(b).
"Normal Unit" means the collective rights and obligations of a Holder
of a Normal Units Certificate in respect of a Note or the appropriate
Treasury Consideration or Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, subject in each case to the Pledge thereof,
and the related Purchase Contract.
"Normal Units Certificate" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Normal Units
specified on such certificate, substantially in the form of Exhibit A
hereto.
"Normal Units Register" and "Normal Units Registrar" have the
respective meanings specified in Section 3.5(a).
"Notes" means the series of senior debt securities of the Company
designated the 6.50% Senior Notes due 2007, to be issued under the
Indenture, dated as of the date hereof, between the Company and Bank One
Trust Company, N.A., as trustee.
"NYSE" has the meaning specified in Section 5.1(c).
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"Officer's Certificate" means a certificate signed by the Chief
Executive Officer, the Chief Financial Officer, the President, any Vice-
President, the Treasurer, any Assistant Treasurer, the Secretary or any
Assistant Secretary (or other officer performing similar functions) of the
Company and delivered to the Agent.
"Opinion of Counsel" means an opinion in writing signed by legal
counsel, who may be an employee of or counsel to the Company or an
Affiliate and who shall be reasonably acceptable to the Agent.
"Opt-out Treasury Consideration" has meaning specified in Section
5.4(b)(iv).
"Outstanding Units" means, as of the date of determination, all Normal
Units or Stripped Units evidenced by Certificates theretofore
authenticated, executed and delivered under this Agreement, except:
(i) If a Termination Event has occurred, (A) Stripped Units and
(B) Normal Units for which the related Note or the appropriate
Treasury Consideration or Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, has been theretofore deposited
with the Agent in trust for the Holders of such Normal Units;
(ii) Normal Units and Stripped Units evidenced by Certificates
theretofore cancelled by the Agent or delivered to the Agent for
cancellation or deemed cancelled pursuant to the provisions of this
Agreement; and
(iii) Normal Units and Stripped Units evidenced by Certificates
in exchange for or in lieu of which other Certificates have been
authenticated, executed on behalf of the Holder and delivered pursuant
to this Agreement, other than any such Certificate in respect of which
there shall have been presented to the Agent proof satisfactory to it
that such Certificate is held by a bona fide purchaser in whose hands
the Normal Units or Stripped Units evidenced by such Certificate are
valid obligations of the Company;
provided, that in determining whether the Holders of the requisite number
of the Normal Units or Stripped Units have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Normal Units
or Stripped Units owned by the Company or any Affiliate of the Company
shall be disregarded and deemed not to be outstanding, except that, in
determining whether the Agent shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Normal Units or Stripped Units which a Responsible Officer of the Agent
knows to be so owned shall be so disregarded. Normal Units or Stripped
Units so owned which have been pledged in good faith
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may be regarded as Outstanding Units if the pledgee establishes to the
satisfaction of the Agent the pledgee's right so to act with respect to
such Normal Units or Stripped Units and that the pledgee is not the Company
or any Affiliate of the Company.
"Payment Date" means each February 16, May 16, August 16 and November
16, commencing February 16, 2002.
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
"Pledge" means the pledge under the Pledge Agreement of the Notes, the
Treasury Securities or the appropriate Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio, in each case constituting a
part of the Units, property, cash, securities, financial assets and
security entitlements of the Collateral Account (as defined in the Pledge
Agreement) and any proceeds of any of the foregoing.
"Pledge Agreement" means the Pledge Agreement, dated as of the date
hereof, by and among the Company, the Collateral Agent, the Custodial
Agent, the Securities Intermediary and the Agent, on its own behalf and as
attorney-in-fact for the Holders from time to time of the Units.
"Pledged Applicable Ownership Interest in the Treasury Portfolio" has
the meaning set forth in Section 2.1(c) of the Pledge Agreement.
"Pledged Notes" has the meaning set forth in Section 2.1(c) of the
Pledge Agreement.
"Pledged Treasury Consideration" has the meaning set forth in Section
2.1(c) of the Pledge Agreement.
"Pledged Treasury Securities" has the meaning set forth in Section
2.1(c) of the Pledge Agreement.
"Predecessor Certificate" means a Predecessor Normal Units Certificate
or a Predecessor Stripped Units Certificate.
"Predecessor Normal Units Certificate" of any particular Normal Units
Certificate means every previous Normal Units Certificate evidencing all or
a portion of the rights and obligations of the Company and the Holder under
the Normal Units evidenced thereby; and, for the purposes of this
definition, any Normal Units Certificate authenticated and delivered under
Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Normal Units Certificate shall be deemed to evidence the same rights
and obligations of the
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Company and the Holder as the mutilated, destroyed, lost or stolen Normal
Units Certificate.
"Predecessor Stripped Units Certificate" of any particular Stripped
Units Certificate means every previous Stripped Units Certificate
evidencing all or a portion of the rights and obligations of the Company
and the Holder under the Stripped Units evidenced thereby; and, for the
purposes of this definition, any Stripped Units Certificate authenticated
and delivered under Section 3.10 in exchange for or in lieu of a mutilated,
destroyed, lost or stolen Stripped Units Certificate shall be deemed to
evidence the same rights and obligations of the Company and the Holder as
the mutilated, destroyed, lost or stolen Stripped Units Certificate.
"Purchase Contract," when used with respect to any Unit, means the
contract forming a part of such Unit and obligating the Company to sell and
the Holder of such Unit to purchase Common Stock on the terms and subject
to the conditions set forth in Article V.
"Purchase Contract Settlement Fund" has the meaning specified in
Section 5.5.
"Purchase Price" has the meaning specified in Section 5.1(a).
"Purchased Shares" has the meaning specified in Section 5.6(a)(6).
"Quotation Agent" means Xxxxxxx, Xxxxx & Co., X.X. Xxxxxx Securities
Inc. or Xxxxxxx Xxxxx Xxxxxx Inc., or any of their successors or any other
primary U.S. government securities dealer in New York City selected by the
Company.
"Record Date" for the distribution payable on any Payment Date means,
as to any Global Certificate, the Business Day next preceding such Payment
Date, and as to any other Certificate, the 15th day preceding such Payment
Date.
"Redemption Amount" means, for each Note, the product of (i) the
principal amount of such Note and (ii) a fraction whose numerator is the
applicable Treasury Portfolio Purchase Price and whose denominator is the
applicable Tax Event Redemption Principal Amount.
"Redemption Price" means the redemption price per Note equal to the
Redemption Amount plus any accrued and unpaid interest on such Note to the
date of redemption.
"Register" means the Normal Units Register and the Stripped Units
Register, as applicable.
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"Registrar" means the Normal Units Registrar and the Stripped Units
Registrar, as applicable.
"Remarketing Agent" has the meaning specified in Section 5.4(b)(i).
"Remarketing Agreement" means the Remarketing Agreement to be entered
into by and among the Company, the Remarketing Agent and the Agent.
"Remarketing Date" means the third business day preceding August 16,
2004.
"Remarketing Fee" has the meaning specified in Section 5.4(b)(i).
"Remarketing Period" means the three Business Day period either (i)
beginning on the Remarketing Date and ending after the two immediately
following Business Days; (ii) immediately preceding October 1, 2004; or
(iii) immediately preceding November 16, 2004.
"Remarketing Value" means the sum of
(i) the value at the Remarketing Date or any Subsequent
Remarketing Date, as the case may be, of U.S. Treasury securities that
will pay, on or prior to the Payment Date falling on the Stock
Purchase Date, an amount of cash equal to the aggregate interest
payments that are scheduled to be payable on that Payment Date, on the
Notes which are included in Normal Units and are participating in the
remarketing, assuming for that purpose, even if not true, that the
interest rate on the Notes is equal to the Coupon Rate, and
(ii) the value at the Remarketing Date or any Subsequent
Remarketing Date, as the case may be, of U.S. Treasury securities that
will pay, on or prior to the Stock Purchase Date, an amount of cash
equal to the Stated Amount of such Notes that are included in Normal
Units and which are participating in the remarketing,
provided that for purposes of clauses (i) and (ii) above, the Remarketing
Value shall be calculated on the assumptions that (x) the U.S. Treasury
securities are highly liquid and mature on or within 35 days prior to the
Stock Purchase Date, as determined in good faith by the Remarketing Agent
in a manner intended to minimize the cash value of the U.S. Treasury
securities, and (y) the U.S. Treasury securities are valued based on the
ask-side price of the U.S. Treasury securities at a time between 9:00 a.m.
and 11:00 a.m., New York City time, selected by the Remarketing Agent, on
the Remarketing Date or any Subsequent Remarketing Date, as the case may
be, as determined on a third-day settlement basis by a reasonable and
customary means selected in good faith by the Remarketing Agent, plus
accrued interest to that date.
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"Reorganization Event" has the meaning specified in Section 5.6(b).
"Responsible Officer" means, when used with respect to the Agent, any
officer within the corporate trust department of the Agent (or any
successor of the Agent), including any Vice President, any assistant Vice
President, any assistant secretary, the treasurer, any assistant treasurer,
any trust officer or any other officer of the Agent who customarily
performs functions similar to those performed by the Persons who at the
time shall be such officers, respectively, or to whom any corporate trust
matter is referred because of such Person's knowledge of and familiarity
with the particular subject and who shall have direct responsibility for
the administration of this Agreement.
"Sale Price" of the Common Stock or any securities distributed in a
Spin-Off, as the case may be, on any Trading Day means the closing sale
price per share (or if no closing sale price is reported, the average of
the bid and ask prices or, if more than one in either case, the average of
the average bid and the average asked prices) on such Trading Day as
reported in composite transactions for the principal U.S. securities
exchange on which the Common Stock or such securities are traded or, if the
Common Stock or such securities are not listed on a U.S. national or
regional securities exchange, as reported by Nasdaq.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Intermediary" means The Chase Manhattan Bank, a national
banking corporation, in its capacity as Securities Intermediary under the
Pledge Agreement, together with its successors in such capacity.
"Separate Notes" has the meaning set forth in the Pledge Agreement.
"Settlement Date" means any Early Settlement Date or Merger Early
Settlement Date or the Stock Purchase Date.
"Settlement Rate" has the meaning specified in Section 5.1(a).
"Spin-Off" means a dividend or other distribution of shares of Capital
Stock of any class or series, or similar equity interests, of or relating
to a subsidiary or other business unit of the Company.
"Stated Amount" means, with respect to any one Note, Normal Unit or
Stripped Unit, $50.
"Stock Purchase Date" means November 16, 2004.
"Stripped Unit" means the collective rights and obligations of a
holder of a Stripped Units Certificate in respect of a 1/20 undivided
beneficial interest in a
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Treasury Security, subject in each case to the Pledge thereof, and the
related Purchase Contract.
"Stripped Units Certificate" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Stripped Units
specified on such certificate, substantially in the form of Exhibit B
hereto.
"Stripped Units Register" and "Stripped Units Registrar" have the
respective meanings specified in Section 3.5(a).
"Subsequent Remarketing Date" means, provided there has been one or
more Failed Remarketings, the date on which the Remarketing Agent has
consummated a successful remarketing in accordance with Section 5.4 hereof,
such date to be no later than the business day immediately preceding the
Stock Purchase Date.
"Tax Event" means the receipt by the Company of an opinion of a
nationally recognized tax counsel experienced in such matters, which may be
XxXxxxxxx, Will & Xxxxx, to the effect that there is more than an
insubstantial risk that interest payable by the Company on the Notes on the
next Payment Date would not be deductible, in whole or in part, by the
Company for United States federal income tax purposes, as a result of (a)
any amendment to, or change (including any announced proposed change) in,
the laws (or any regulations thereunder) of the United States or any
political subdivision or taxing authority thereof or therein affecting
taxation, (b) any amendment to or change in an official interpretation or
application of such laws or regulations by any legislative body, court,
governmental agency or regulatory authority or (c) any official
interpretation or pronouncement that provides for a position with respect
to such laws or regulations that differs from the generally accepted
position on October 26, 2001, which amendment, change or proposed change is
effective or which interpretation or pronouncement is announced on or after
October 26, 2001.
"Tax Event Redemption" means, if a Tax Event shall occur and be
continuing, the redemption of the Notes, at the option of the Company, in
whole but not in part, on not less than 30 days nor more than 60 days'
written notice.
"Tax Event Redemption Date" means the date upon which a Tax Event
Redemption is to occur.
"Tax Event Redemption Principal Amount" means in the case of a Tax
Event Redemption occurring prior to a successful remarketing of the Notes,
for each Note the product of the principal amount of the Note and a
fraction whose numerator is the Treasury Portfolio Purchase Price and whose
denominator is the aggregate principal amount of Notes included in Normal
Units, and in the case of a Tax Event Redemption Date occurring after a
successful remarketing of the Notes, the par value of the Notes.
12
"Termination Date" means the date, if any, on which a Termination
Event occurs.
"Termination Event" means the occurrence of any of the following
events:
(i) at any time on or prior to the Stock Purchase Date, a
judgment, decree or court order shall have been entered granting
relief under the Bankruptcy Code or any other similar Federal or state
law, adjudicating the Company to be insolvent, or approving as
properly filed a petition seeking reorganization or liquidation of the
Company, and, unless such judgment, decree or order shall have been
entered within 60 days prior to the Stock Purchase Date, such decree
or order shall have continued undischarged and unstayed for a period
of 60 days;
(ii) a judgment, decree or court order for the appointment of a
receiver or liquidator or trustee or assignee in bankruptcy or
insolvency of the Company or of its property, or for the winding up or
liquidation of its affairs, shall have been entered, and, unless such
judgment, decree or order shall have been entered within 60 days prior
to the Stock Purchase Date, such judgment, decree or order shall have
continued undischarged and unstayed for a period of 60 days; or
(iii) at any time on or prior to the Stock Purchase Date the
Company shall file a petition for relief under the Bankruptcy Code or
any other similar federal or state law, or shall consent to the filing
of a bankruptcy proceeding against it, or shall file a petition or
answer or consent seeking reorganization or liquidation under the
Bankruptcy Code or any other similar federal or state law, or shall
consent to the filing of any such petition, or shall consent to the
appointment of a receiver or liquidator or trustee or assignee in
bankruptcy or insolvency of it or of its property, or shall make an
assignment for the benefit of creditors, or shall admit in writing its
inability to pay its debts generally as they become due.
"Threshold Appreciation Price" has the meaning specified in Section
5.1(a)(i).
"TIA" means the Trust Indenture Act of 1939, as amended.
"Trading Day" has the meaning specified in Section 5.1(c).
"Transaction Documents" has the meaning specified in Section 7.1(a).
"Treasury Consideration" means the Agent-purchased Treasury
Consideration or the Opt-out Treasury Consideration.
13
"Treasury Portfolio" means: (i) if a Tax Event Redemption occurs prior
to a successful remarketing of the Notes, a portfolio of principal or
interest strips of U.S. Treasury Securities that mature on or prior to the
Stock Purchase Date in an aggregate amount equal to the aggregate principal
amount of the Notes included in the Normal Units on the Tax Event
Redemption Date and with respect to each scheduled interest Payment Date on
the Notes that occurs after the Tax Event Redemption Date and on or before
the Stock Purchase Date, interest or principal strips of U.S. Treasury
Securities that mature on or prior to such interest Payment Date in an
aggregate amount equal to the aggregate interest payment that would be due
on the aggregate principal amount of the Notes on such date if the interest
rate of the Notes were not reset on the applicable Remarketing Date, and
(ii) solely for purposes of determining the Treasury Portfolio Purchase
Price in the case of a Tax Event Redemption Date occurring prior to a
successful remarketing of the Notes, a portfolio of U.S. Treasury
Securities consisting of principal or interest strips of U.S. Treasury
Securities that mature on or prior to the Stock Purchase Date in an
aggregate amount equal to the aggregate principal amount of the Notes
outstanding on the Tax Event Redemption Date and with respect to each
scheduled interest Payment Date on the Notes that occurs after the Tax
Event Redemption Date and on or before the Stock Purchase Date, interest or
principal strips of U.S. Treasury Securities that mature on or prior to
such interest Payment Date in an aggregate amount equal to the aggregate
interest payment that would be due on the aggregate principal amount of the
Notes outstanding on the Tax Event Redemption Date.
"Treasury Portfolio Purchase Price" means the lowest aggregate price
quoted by a primary U.S. government securities dealer in New York City to
the Quotation Agent on the third Business Day immediately preceding the Tax
Event Redemption Date for the purchase of the Treasury Portfolio for
settlement on the Tax Event Redemption Date.
"Treasury Security" means a zero-coupon U.S. Treasury security (CUSIP
Number 912833FY7) maturing on the Stock Purchase Date that will pay $1,000
on such maturity date.
"Trustee" means Bank One Trust Company, N.A., a national banking
association, as trustee under the Indenture, or any successor thereto.
"Underwriting Agreement" means the Underwriting Agreement relating to
the Units dated October 25, 2001 among the Company and the underwriters
named therein.
"Unit" means a Normal Unit or a Stripped Unit.
"Vice-President" means any vice-president, whether or not designated
by a number or a word or words added before or after the title "vice-
president."
14
SECTION 1.2 COMPLIANCE CERTIFICATES AND OPINIONS.
Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Agent to take any action under any
provision of this Agreement, the Company shall furnish to the Agent an Officer's
Certificate stating that all conditions precedent, if any, provided for in this
Agreement relating to the proposed action have been complied with and, if
requested by the Agent, an Opinion of Counsel stating that, in the opinion of
such counsel, all such conditions precedent, if any, have been complied with,
except that in the case of any such application or request as to which the
furnishing of such documents is specifically required by any provision of this
Agreement relating to such particular application or request, no additional
certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement shall include:
(a) a statement that the individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such individual, he or she has
made such examination or investigation as is necessary to enable such
individual to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of such individual, such
condition or covenant has been complied with.
SECTION 1.3 FORM OF DOCUMENTS DELIVERED TO AGENT.
(a) In any case where several matters are required to be certified by,
or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one
such Person, or that they be so certified or covered by only one document,
but one such Person may certify or give an opinion with respect to some
matters and one or more other such Persons as to other matters, and any
such Person may certify or give an opinion as to such matters in one or
several documents.
(b) Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or
in the exercise of reasonable care should know, that the certificate or
opinion or representations with respect to the matters upon which his
certificate or opinion is based are
15
erroneous. Any such certificate or Opinion of Counsel may be based, insofar
as it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of
the Company unless such counsel knows, or in the exercise of reasonable
care should know, that the certificate or opinion or representations with
respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
SECTION 1.4 ACTS OF HOLDERS; RECORD DATES.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent
duly appointed in writing; and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or
instruments are delivered to the Agent and, where it is hereby expressly
required, to the Company. Such instrument or instruments (and the action
embodied therein and evidenced thereby) are herein sometimes referred to as
the "Act" of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Agreement and (subject to
Section 7.1) conclusive in favor of the Agent and the Company, if made in
the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner which the Agent deems
sufficient.
(c) The ownership of Units shall be proved by the Normal Units
Register or the Stripped Units Register, as the case may be.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Certificate shall bind every
future Holder of the same Certificate and the Holder of every Certificate
issued upon the registration of transfer thereof or in exchange therefor or
in lieu thereof in respect of anything done, omitted or suffered to be done
by the Agent or the Company in reliance thereon, whether or not notation of
such action is made upon such Certificate.
(e) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Units entitled to give, make or take
any request, demand, authorization, direction, notice, consent, waiver or
other action provided or permitted by this Agreement to be given, made or
taken by Holders of
16
Units. If any record date is set pursuant to this paragraph, the Holders of
the Outstanding Normal Units and the Outstanding Stripped Units, as the
case may be, on such record date, and no other Holders, shall be entitled
to take the relevant action with respect to the Normal Units or the
Stripped Units, as the case may be, whether or not such Holders remain
Holders after such record date; provided that no such action shall be
effective hereunder unless taken on or prior to the applicable Expiration
Date by Holders of the requisite number of Outstanding Units on such record
date. Nothing in this paragraph shall be construed to prevent the Company
from setting a new record date for any action for which a record date has
previously been set pursuant to this paragraph (whereupon the record date
previously set shall automatically and with no action by any Person be
cancelled and of no effect), and nothing in this paragraph shall be
construed to render ineffective any action taken by Holders of the
requisite number of Outstanding Units on the date such action is taken.
Promptly after any record date is set pursuant to this paragraph, the
Company, at its own expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be given
to the Agent in writing and to each Holder of Units in the manner set forth
in Section 1.6.
(f) With respect to any record date set pursuant to this Section, the
Company may designate any date as the "Expiration Date" and from time to
time may change the Expiration Date to any earlier or later day; provided
that no such change shall be effective unless notice of the proposed new
Expiration Date is given to the Agent in writing, and to each Holder of
Units in the manner set forth in Section 1.6, on or prior to the existing
Expiration Date. If an Expiration Date is not designated with respect to
any record date set pursuant to this Section, the Company shall be deemed
to have initially designated the 180th day after such record date as the
Expiration Date with respect thereto, subject to its right to change the
Expiration Date as provided in this paragraph. Notwithstanding the
foregoing, no Expiration Date shall be later than the 180th day after the
applicable record date.
SECTION 1.5 NOTICES.
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Agreement to
be made upon, given or furnished to, or filed with:
(a) the Agent by any Holder or by the Company shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or filed in writing and personally delivered,
mailed, first-class postage prepaid, telecopied or delivered by overnight
air courier guaranteeing next day delivery, to the Agent at First Union
Trust Company, National Association, Xxx Xxxxxx Xxxxxx, Xxxxx 000, 000 Xxxx
Xxxxxx, Xxxxxxxxxx, Xxxxxxxx, 00000, Attention: Corporate Trust
Administration, telecopy: (302)
17
888-7544, or at any other address furnished in writing by the Agent to the
Holders and the Company; or
(b) the Company by the Agent or by any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or filed in writing and personally delivered,
mailed, first-class postage prepaid, telecopied or delivered by overnight
air courier guaranteeing next day delivery, to the Company at Motorola,
Inc., 0000 Xxxx Xxxxxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx 00000, telecopy: (847)
576-4768, Attention: Treasurer, or at any other address furnished in
writing to the Agent by the Company; or
(c) the Collateral Agent by the Agent, the Company or any Holder shall
be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing and
personally delivered, mailed, first-class postage prepaid, telecopied or
delivered by overnight air courier guaranteeing next day delivery,
addressed to the Collateral Agent at The Chase Manhattan Bank, 000 Xxxx
00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Institutional Trust
Services, telecopy: (000) 000-0000, or at any other address furnished in
writing by the Collateral Agent to the Agent, the Company and the Holders;
or
(d) the Trustee by the Company shall be sufficient for every purpose
hereunder (unless otherwise herein expressly provided) if made, given,
furnished or filed in writing and personally delivered, mailed, first-class
postage prepaid, telecopied or delivered by overnight air courier
guaranteeing next day delivery, addressed to the Trustee at Bank One, N.A.,
1 Bank Xxx Xxxxx, Xxxxx XX0-0000, Xxxxxxx, XX 00000-0000, Attention: Global
Corporate Trust Services, telecopy: (000) 000-0000 or at any other address
furnished in writing by the Trustee to the Company.
SECTION 1.6 NOTICE TO HOLDERS; WAIVER.
(a) Where this Agreement provides for notice to Holders of any event,
such notice shall be sufficiently given (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to each
Holder affected by such event, at its address as it appears in the
applicable Register, not later than the latest date, and not earlier than
the earliest date, prescribed for the giving of such notice. In any case
where notice to Holders is given by mail, neither the failure to mail such
notice, nor any defect in any notice so mailed to any particular Holder
shall affect the sufficiency of such notice with respect to other Holders.
Where this Agreement provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Holders shall be filed with the Agent, but
such filing
18
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
(b) In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the
Agent shall constitute a sufficient notification for every purpose
hereunder.
SECTION 1.7 EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 1.8 SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Agreement by the Company shall
bind its successors and assigns, whether so expressed or not.
SECTION 1.9 SEPARABILITY CLAUSE.
In case any provision in this Agreement or in the securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof and thereof shall not in any way be affected or
impaired thereby.
SECTION 1.10 BENEFITS OF AGREEMENT.
Nothing in this Agreement or in the Units, express or implied, shall
give to any Person, other than the parties hereto and their successors hereunder
and, to the extent provided hereby, the Holders, any benefits or any legal or
equitable right, remedy or claim under this Agreement. The Holders from time to
time shall be beneficiaries of this Agreement and shall be bound by all of the
terms and conditions hereof and of the Units evidenced by their Certificates by
their acceptance of delivery of such Certificates.
SECTION 1.11 GOVERNING LAW.
This Agreement and the Units shall be governed by and construed in
accordance with the laws of the State of New York, without regard to its
principles of conflicts of laws.
SECTION 1.12 LEGAL HOLIDAYS.
(a) In any case where any Payment Date shall not be a Business Day,
then (notwithstanding any other provision of this Agreement or the Normal
Units Certificates) payments on the Notes shall not be made on such date,
but such payments shall be made on the next succeeding Business Day with
the same force and effect as if made on such Payment Date, provided that no
interest shall accrue
19
or be payable by the Company for the period from and after any such Payment
Date, except that if such next succeeding Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day with the same force and effect as if made on such
Payment Date.
(b) If any date on which Contract Adjustment Payments are to be made
on the Purchase Contracts is not a Business Day, then payment of the
Contract Adjustment Payments payable on that date will be made on the next
succeeding day which is a Business Day, and no interest or additional
payment will be paid in respect of the delay. However, if that Business Day
is in the next succeeding calendar year, the payment will be made on the
immediately preceding Business Day with the same force and effect as if
made on that Payment Date.
(c) In any case where the Stock Purchase Date shall not be a Business
Day, then (notwithstanding any other provision of this Agreement or the
Certificates), the Purchase Contracts shall not be performed on such date,
but the Purchase Contracts shall be performed on the immediately following
Business Day with the same force and effect as if performed on the Stock
Purchase Date.
SECTION 1.13 COUNTERPARTS.
This Agreement may be executed in any number of counterparts by the
parties hereto, each of which, when so executed and delivered, shall be deemed
an original, but all such counterparts shall together constitute one and the
same instrument.
SECTION 1.14 INSPECTION OF AGREEMENT.
A copy of this Agreement shall be available at all reasonable times
during normal business hours at the Corporate Trust Office for inspection by any
Holder.
ARTICLE II
CERTIFICATE FORMS
SECTION 2.1 FORMS OF CERTIFICATES GENERALLY.
(a) The Normal Units Certificates (including the form of Purchase
Contract forming part of the Normal Units evidenced thereby) shall be in
substantially the form set forth in Exhibit A hereto, with such letters,
numbers or other marks of identification or designation and such legends or
endorsements printed, lithographed or engraved thereon as may be required
by the rules of any securities exchange or quotation system on which the
Normal Units are listed or quoted for trading or any depositary therefor,
or as may, consistently herewith, be determined by the officers of the
Company executing such Normal Units Certificates, as evidenced by their
execution of the Normal Units Certificates.
20
(b) The definitive Normal Units Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in
any other manner, all as determined by the officers of the Company
executing such Normal Units Certificates, consistent with the provisions of
this Agreement, as evidenced by their execution thereof.
(c) The Stripped Units Certificates (including the form of Purchase
Contracts forming part of the Stripped Units evidenced thereby) shall be in
substantially the form set forth in Exhibit B hereto, with such letters,
numbers or other marks of identification or designation and such legends or
endorsements printed, lithographed or engraved thereon as may be required
by the rules of any securities exchange or the quotation system on which
the Stripped Units may be listed or quoted for trading or any depositary
therefor, or as may, consistently herewith, be determined by the officers
of the Company executing such Stripped Units Certificates, as evidenced by
their execution of the Stripped Units Certificates.
(d) The definitive Stripped Units Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in
any other manner, all as determined by the officers of the Company
executing such Stripped Units Certificates, consistent with the provisions
of this Agreement, as evidenced by their execution thereof.
(e) Every Global Certificate authenticated, executed on behalf of the
Holders and delivered hereunder shall bear a legend in substantially the
following form:
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED
IN THE NAME OF THE CLEARING AGENCY OR A NOMINEE THEREOF. THIS
CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE
REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE IN WHOLE OR IN PART
MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH CLEARING
AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT."
SECTION 2.2 FORM OF AGENT'S CERTIFICATE OF AUTHENTICATION.
(a) The form of the Agent's certificate of authentication of the
Normal Units shall be in substantially the form set forth on the form of
the Normal Units Certificates.
21
(b) The form of the Agent's certificate of authentication of the
Stripped Units shall be in substantially the form set forth on the form of
the Stripped Units Certificates.
ARTICLE III
THE UNITS
SECTION 3.1 TITLE AND TERMS; DENOMINATIONS.
(a) The aggregate number of Normal Units and Stripped Units, if any,
evidenced by Certificates authenticated, executed on behalf of the Holders
and delivered hereunder is limited to 21,000,000 (24,000,000 if the
Underwriters' (as defined in the Underwriting Agreement) over-allotment
option pursuant to the Underwriting Agreement is exercised in full), except
for Certificates authenticated, executed and delivered upon registration of
transfer of, in exchange for, or in lieu of, other Certificates pursuant to
Section 3.4, 3.5, 3.10, 3.13, 3.14, 5.9, 5.10 or 8.5.
(b) The Certificates shall be issuable only in registered form and
only in denominations of a single Unit and any integral multiple thereof.
SECTION 3.2 RIGHTS AND OBLIGATIONS EVIDENCED BY THE CERTIFICATES.
(a) Each Normal Units Certificate shall evidence the number of Normal
Units specified therein, with each such Normal Unit representing the
ownership by the Holder thereof of a beneficial interest in a Note or the
appropriate Treasury Consideration or Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, subject to the Pledge of such Note,
Treasury Consideration or Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, by such Holder pursuant to the Pledge
Agreement, and the rights and obligations of the Holder thereof and the
Company under one Purchase Contract. The Agent as attorney-in-fact for, and
on behalf of, the Holder of each Normal Unit shall pledge, pursuant to the
Pledge Agreement, the Note or the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, forming a part of such Normal Unit, to the Collateral Agent and grant
to the Collateral Agent a security interest in the right, title, and
interest of such Holder in such Note, Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, for the
benefit of the Company, to secure the obligation of the Holder under each
Purchase Contract to purchase the Common Stock of the Company. Prior to the
purchase of shares of Common Stock under each Purchase Contract, such
Purchase Contracts shall not entitle the Holders of Normal Units
Certificates to any of the rights of a holder of shares of Common Stock,
including, without limitation, the right to vote or receive any dividends
or other payments or to
22
consent or to receive notice as stockholders in respect of the meetings of
stockholders or for the election of directors of the Company or for any
other matter, or any other rights whatsoever as stockholders of the
Company.
(b) Each Stripped Units Certificate shall evidence the number of
Stripped Units specified therein, with each such Stripped Unit representing
the ownership by the Holder thereof of a 1/20 undivided beneficial interest
in a Treasury Security, subject to the Pledge of such interest in such
Treasury Security by such Holder pursuant to the Pledge Agreement, and the
rights and obligations of the Holder thereof and the Company under one
Purchase Contract. Prior to the purchase of shares of Common Stock under
each Purchase Contract, such Purchase Contracts shall not entitle the
Holders of Stripped Units Certificates to any of the rights of a holder of
shares of Common Stock, including, without limitation, the right to vote or
receive any dividends or other payments or to consent or to receive notice
as stockholders in respect of the meetings of stockholders or for the
election of directors of the Company or for any other matter, or any other
rights whatsoever as stockholders of the Company.
SECTION 3.3 EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
(a) Subject to the provisions of Sections 3.13 and 3.14, upon the
execution and delivery of this Agreement, and at any time and from time to
time thereafter, the Company may deliver Certificates executed by the
Company to the Agent for authentication, execution on behalf of the Holders
and delivery, together with its Issuer Order for authentication of such
Certificates, and the Agent in accordance with such Issuer Order shall
authenticate, execute on behalf of the Holders and deliver such
Certificates.
(b) The Certificates shall be executed on behalf of the Company by
the Chief Executive Officer, the Chief Financial Officer, the President,
any Vice-President, the Treasurer, any Assistant Treasurer, the Secretary
or any Assistant Secretary (or other officer performing similar functions)
of the Company and delivered to the Agent. The signature of any of these
officers on the Certificates may be manual or facsimile.
(c) Certificates bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall
bind the Company, notwithstanding that such individuals or any of them have
ceased to hold such offices prior to the authentication and delivery of
such Certificates or did not hold such offices at the date of such
Certificates.
(d) No Purchase Contract evidenced by a Certificate shall be valid
until such Certificate has been executed on behalf of the Holder by the
manual signature of an authorized signatory of the Agent, as such Holder's
attorney-in-fact. Such signature by an authorized signatory of the Agent
shall be conclusive
23
evidence that the Holder of such Certificate has entered into the Purchase
Contracts evidenced by such Certificate.
(e) Each Certificate shall be dated the date of its authentication.
(f) No Certificate shall be entitled to any benefit under this
Agreement or be valid or obligatory for any purpose unless there appears on
such Certificate a certificate of authentication substantially in the form
provided for herein executed by an authorized signatory of the Agent by
manual signature, and such certificate upon any Certificate shall be
conclusive evidence, and the only evidence, that such Certificate has been
duly authenticated and delivered hereunder.
SECTION 3.4 TEMPORARY CERTIFICATES.
(a) Pending the preparation of definitive Certificates, the Company
shall execute and deliver to the Agent, and the Agent shall authenticate,
execute on behalf of the Holders, and deliver, in lieu of such definitive
Certificates, temporary Certificates which are in substantially the form
set forth in Exhibit A or Exhibit B hereto, as the case may be, with such
letters, numbers or other marks of identification or designation and such
legends or endorsements printed, lithographed or engraved thereon as may be
required by the rules of any securities exchange on which the Normal Units
or Stripped Units, as the case may be, are listed, or as may, consistent
herewith, be determined by the officers of the Company executing such
Certificates, as evidenced by their execution of the Certificates.
(b) If temporary Certificates are issued, the Company will cause
definitive Certificates to be prepared without unreasonable delay. After
the preparation of definitive Certificates, the temporary Certificates
shall be exchangeable for definitive Certificates upon surrender of the
temporary Certificates at the Corporate Trust Office, at the expense of the
Company and without charge to the Holder. Upon surrender for cancellation
of any one or more temporary Certificates, the Company shall execute and
deliver to the Agent, and the Agent shall authenticate, execute on behalf
of the Holder, and deliver in exchange therefor, one or more definitive
Certificates of like tenor and denominations and evidencing a like number
of Normal Units or Stripped Units, as the case may be, as the temporary
Certificate or Certificates so surrendered. Until so exchanged, the
temporary Certificates shall in all respects evidence the same benefits and
the same obligations with respect to the Normal Units or Stripped Units, as
the case may be, evidenced thereby as definitive Certificates.
24
SECTION 3.5 REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE.
(a) The Agent shall keep at the Corporate Trust Office a register
(the "Normal Units Register") in which, subject to such reasonable
regulations as it may prescribe, the Agent shall provide for the
registration of Normal Units Certificates and of transfers of Normal Units
Certificates (the Agent, in such capacity, the "Normal Units Registrar")
and a register (the "Stripped Units Register") in which, subject to such
reasonable regulations as it may prescribe, the Agent shall provide for the
registration of the Stripped Units Certificates and transfers of Stripped
Units Certificates (the Agent, in such capacity, the "Stripped Units
Registrar").
(b) Upon surrender for registration of transfer of any Certificate at
the Corporate Trust Office, the Company shall execute and deliver to the
Agent, and the Agent shall authenticate, execute on behalf of the
designated transferee or transferees, and deliver, in the name of the
designated transferee or transferees, one or more new Certificates of like
tenor and denominations, and evidencing a like number of Normal Units or
Stripped Units, as the case may be.
(c) At the option of the Holder, Certificates may be exchanged for
other Certificates, of like tenor and denominations and evidencing a like
number of Normal Units or Stripped Units, as the case may be, upon
surrender of the Certificates to be exchanged at the Corporate Trust
Office. Whenever any Certificates are so surrendered for exchange, the
Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver the Certificates
which the Holder making the exchange is entitled to receive.
(d) All Certificates issued upon any registration of transfer or
exchange of a Certificate shall evidence the ownership of the same number
of Normal Units or Stripped Units, as the case may be, and be entitled to
the same benefits and subject to the same obligations, under this Agreement
as the Normal Units or Stripped Units, as the case may be, evidenced by the
Certificate surrendered upon such registration of transfer or exchange.
(e) Every Certificate presented or surrendered for registration of
transfer or for exchange shall (if so required by the Agent) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Agent duly executed, by the Holder
thereof or its attorney duly authorized in writing.
(f) No service charge shall be made for any registration of transfer
or exchange of a Certificate, but the Company and the Agent may require
payment from the Holder of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration
of transfer or exchange
25
of Certificates, other than any exchanges pursuant to Sections 3.6, 3.9 and
8.5 not involving any transfer.
(g) Notwithstanding the foregoing, the Company shall not be obligated
to execute and deliver to the Agent, and the Agent shall not be obligated
to authenticate, execute on behalf of the Holder and deliver any
Certificate presented or surrendered for registration of transfer or for
exchange on or after the Business Day immediately preceding the earlier of
the Stock Purchase Date or the Termination Date. In lieu of delivery of a
new Certificate, upon satisfaction of the applicable conditions specified
above in this Section and receipt of appropriate registration or transfer
instructions from such Holder, the Agent shall,
(i) if the Stock Purchase Date has occurred, deliver the shares
of Common Stock issuable in respect of the Purchase Contracts forming
a part of the Units evidenced by such Certificate,
(ii) in the case of Normal Units, if a Termination Event shall
have occurred prior to the Stock Purchase Date, transfer the Notes or
the appropriate Treasury Consideration or Applicable Ownership
Interest in the Treasury Portfolio, as applicable, relating to such
Normal Units, or
(iii) in the case of Stripped Units, if a Termination Event
shall have occurred prior to the Stock Purchase Date, transfer the
Treasury Securities relating to such Stripped Units, in each case
subject to the applicable conditions and in accordance with the
applicable provisions of Article V.
SECTION 3.6 BOOK-ENTRY INTERESTS.
The Certificates, on original issuance, will be issued in the form of
one or more, fully registered Global Certificates, to be delivered to the
Depositary by, or on behalf of, the Company. Such Global Certificate shall
initially be registered on the books and records of the Company in the name of
Cede & Co., the nominee of the Depositary, and no Beneficial Owner will receive
a definitive Certificate representing such Beneficial Owner's interest in such
Global Certificate, except as provided in Section 3.9. The Agent shall enter
into an agreement with the Depositary if so requested by the Company. Unless and
until definitive, fully registered Certificates have been issued to Beneficial
Owners pursuant to Section 3.9:
(a) the provisions of this Section 3.6 shall be in full force and
effect;
(b) the Company shall be entitled to deal with the Clearing Agency
for all purposes of this Agreement (including receiving approvals, votes or
consents hereunder) as the Holder of the Units and the sole holder of the
Global Certificate(s) and shall have no obligation to the Beneficial
Owners;
26
(c) to the extent that the provisions of this Section 3.6 conflict
with any other provisions of this Agreement, the provisions of this Section
3.6 shall control; and
(d) the rights of the Beneficial Owners shall be exercised only
through the Clearing Agency and shall be limited to those established by
law and agreements between such Beneficial Owners and the Clearing Agency
and/or the Clearing Agency Participants. The Clearing Agency will make
book-entry transfers among Clearing Agency Participants.
SECTION 3.7 NOTICES TO HOLDERS.
Whenever a notice or other communication to the Holders is required to
be given under this Agreement, the Company or the Company's agent shall give
such notices and communications to the Holders and, with respect to any Units
registered in the name of a Clearing Agency or the nominee of a Clearing Agency,
the Company or the Company's agent shall, except as set forth herein, have no
obligations to the Beneficial Owners.
SECTION 3.8 APPOINTMENT OF SUCCESSOR CLEARING AGENCY.
If any Clearing Agency elects to discontinue its services as
securities depositary with respect to the Units, the Company may, in its sole
discretion, appoint a successor Clearing Agency with respect to the Units.
SECTION 3.9 DEFINITIVE CERTIFICATES.
If
(i) a Clearing Agency elects to discontinue its services as
securities depositary with respect to the Units and a successor
Clearing Agency is not appointed within 90 days after such
discontinuance pursuant to Section 3.8,
(ii) the Company elects to terminate the book-entry system
through the Clearing Agency with respect to the Units, or
(iii) there shall have occurred and be continuing a default by
the Company in respect of its obligations under one or more Purchase
Contracts,
then upon surrender of the Global Certificates representing the Book-
Entry Interests with respect to the Units by the Clearing Agency,
accompanied by registration instructions, the Company shall cause
definitive Certificates to be delivered to Beneficial Owners in
accordance
27
with the instructions of the Clearing Agency. The Company
shall not be liable for any delay in delivery of such instructions and
may conclusively rely on and shall be protected in relying on, such
instructions.
SECTION 3.10 MUTILATED, DESTROYED, LOST AND STOLEN CERTIFICATES.
(a) If any mutilated Certificate is surrendered to the Agent, the
Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver in exchange
therefor, a new Certificate at the cost of the Holder, evidencing the same
number of Normal Units or Stripped Units, as the case may be, and bearing a
Certificate number not contemporaneously outstanding.
(b) If there shall be delivered to the Company and the Agent (i)
evidence to their satisfaction of the destruction, loss or theft of any
Certificate, and (ii) such security or indemnity at the cost of the Holder
as may be required by them to hold each of them and any agent of any of
them harmless, then, in the absence of notice to the Company or the Agent
that such Certificate has been acquired by a bona fide purchaser, the
Company shall execute and deliver to the Agent, and the Agent shall
authenticate, execute on behalf of the Holder, and deliver to the Holder,
in lieu of any such destroyed, lost or stolen Certificate, a new
Certificate, evidencing the same number of Normal Units or Stripped Units,
as the case may be, and bearing a Certificate number not contemporaneously
outstanding.
(c) Notwithstanding the foregoing, the Company shall not be obligated
to execute and deliver to the Agent, and the Agent shall not be obligated
to authenticate, execute on behalf of the Holder, and deliver to the
Holder, a Certificate on or after the Business Day immediately preceding
the earlier of the Stock Purchase Date or the Termination Date. In lieu of
delivery of a new Certificate, upon satisfaction of the applicable
conditions specified above in this Section and receipt of appropriate
registration or transfer instructions from such Holder, the Agent shall (i)
if the Stock Purchase Date has occurred, deliver the shares of Common Stock
issuable in respect of the Purchase Contracts forming a part of the Units
evidenced by such Certificate, or (ii) if a Termination Event shall have
occurred prior to the Stock Purchase Date, transfer the Notes, the
appropriate Treasury Consideration or Applicable Ownership Interest in the
Treasury Portfolio, or the Treasury Securities, as the case may be,
evidenced thereby, in each case subject to the applicable conditions and in
accordance with the applicable provisions of Article V.
(d) Upon the issuance of any new Certificate under this Section, the
Company and the Agent may require the payment by the Holder of a sum
sufficient to cover any tax or other governmental charge that may be
imposed in
28
relation thereto and any other expenses (including the fees and expenses of
the Agent) connected therewith.
(e) Every new Certificate issued pursuant to this Section in lieu of
any destroyed, lost or stolen Certificate shall constitute an original
additional contractual obligation of the Company and of the Holder in
respect of the Unit evidenced thereby, whether or not the destroyed, lost
or stolen Certificate (and the Units evidenced thereby) shall be at any
time enforceable by anyone, and shall be entitled to all the benefits and
be subject to all the obligations of this Agreement equally and
proportionately with any and all other Certificates delivered hereunder.
(f) The provisions of this Section are exclusive and shall preclude
(to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen
Certificates.
SECTION 3.11 PERSONS DEEMED OWNERS.
(a) Prior to due presentment of a Certificate for registration of
transfer, the Company and the Agent, and any agent of the Company or the
Agent, may treat the Person in whose name such Certificate is registered as
the owner of the Units evidenced thereby, for the purpose of receiving
interest payments on the Notes, receiving payment of Contract Adjustment
Payments, performance of the Purchase Contracts and for all other purposes
whatsoever, whether or not any such payments shall be overdue and
notwithstanding any notice to the contrary, and neither the Company nor the
Agent, nor any agent of the Company or the Agent, shall be affected by
notice to the contrary.
(b) Notwithstanding the foregoing, with respect to any Global
Certificate, nothing herein shall prevent the Company, the Agent or any
agent of the Company or the Agent, from giving effect to any written
certification, proxy or other authorization furnished by any Clearing
Agency (or its nominee), as a Holder, with respect to such Global
Certificate or impair, as between such Clearing Agency and owners of
beneficial interests in such Global Certificate, the operation of customary
practices governing the exercise of rights of such Clearing Agency (or its
nominee) as Holder of such Global Certificate.
SECTION 3.12 CANCELLATION.
(a) All Certificates surrendered (i) for delivery of shares of Common
Stock on or after any Settlement Date; (ii) upon the transfer of Notes, the
appropriate Treasury Consideration or Applicable Ownership Interest in the
Treasury Portfolio, or Treasury Securities, as the case may be, after the
occurrence of a Termination Event; or (iii) upon the registration of a
transfer or exchange of a Unit shall, if surrendered to any Person other
than the Agent, be delivered to the Agent and, if not already cancelled,
shall be promptly cancelled
29
by it. The Company may at any time deliver to the Agent for cancellation
any Certificates previously authenticated, executed and delivered hereunder
which the Company may have acquired in any manner whatsoever, and all
Certificates so delivered shall, upon Issuer Order, be promptly cancelled
by the Agent. No Certificates shall be authenticated, executed on behalf of
the Holder and delivered in lieu of or in exchange for any Certificates
cancelled as provided in this Section, except as expressly permitted by
this Agreement. All cancelled Certificates held by the Agent shall be
destroyed by the Agent unless otherwise directed by Issuer Order.
(b) If the Company or any Affiliate of the Company shall acquire any
Certificate, such acquisition shall not operate as a cancellation of such
Certificate unless and until such Certificate is delivered to the Agent
cancelled or for cancellation.
SECTION 3.13 ESTABLISHMENT OF STRIPPED UNITS.
(a) A Holder may separate the Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as applicable, from the related Purchase Contracts in respect of
the Normal Units held by such Holder by substituting for such Pledged
Notes, Pledged Treasury Consideration or Pledged Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, Treasury Securities
that will pay, on the Stock Purchase Date, an amount equal to the aggregate
principal amount of such Notes or the appropriate Treasury Consideration or
Applicable Ownership Interest (as specified in clause (A) of the definition
of such term) of the Treasury Portfolio (a "Collateral Substitution"), at
any time from and after the date of this Agreement and on or prior to the
second Business Day immediately preceding the Stock Purchase Date, by (i)
depositing with the Collateral Agent Treasury Securities having an
aggregate principal amount equal to the aggregate Stated Amount of such
Normal Units, and (ii) transferring the related Normal Units to the Agent
accompanied by a notice to the Agent, substantially in the form of Exhibit
D hereto, stating that the Holder has transferred the relevant amount of
Treasury Securities to the Collateral Agent and requesting that the Agent
instruct the Collateral Agent to release the Pledged Notes, Pledged
Treasury Consideration or Pledged Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, underlying such Normal Units,
whereupon the Agent shall promptly give such instruction to the Collateral
Agent, substantially in the form of Exhibit C hereto. Notwithstanding the
foregoing, a Holder may not separate the Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, from the related Purchase Contracts in
respect of the Normal Units held by such Holder during the periods
beginning on the fourth Business Day prior to any Remarketing Period and
ending on the third business day after the end of such Remarketing Period.
Upon receipt of the Treasury Securities described in clause (i) above and
30
the instruction described in clause (ii) above, in accordance with the
terms of the Pledge Agreement, the Collateral Agent will release to the
Agent, on behalf of the Holder, such Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, from the Pledge, free and clear of the
Company's security interest therein, and upon receipt thereof the Agent
shall promptly:
(i) cancel the related Normal Units;
(ii) transfer the Pledged Notes, Pledged Treasury Consideration
or Pledged Applicable Ownership Interest of the Treasury Portfolio, as
the case may be, to the Holder; and
(iii) authenticate, execute on behalf of such Holder and deliver
a Stripped Units Certificate executed by the Company in accordance
with Section 3.3 evidencing the same number of Purchase Contracts as
were evidenced by the cancelled Normal Units.
(b) Holders who elect to separate the Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, from the related Purchase Contract and to
substitute Treasury Securities for such Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, shall be responsible for any fees or
expenses payable to the Collateral Agent for its services as Collateral
Agent in respect of the substitution, and the Company shall not be
responsible for any such fees or expenses.
(c) Holders may make Collateral Substitutions (i) if Treasury
Securities are being substituted for Pledged Notes, only in integral
multiples of 20 Normal Units, or (ii) if the Collateral Substitutions occur
after the Remarketing Date or any Subsequent Remarketing Date, or after a
Tax Event Redemption, as the case may be, only in integral multiples of
Normal Units such that the Treasury Securities to be deposited and the
Treasury Consideration, or the Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, to be released are in integral
multiples of $1,000.
(d) In the event a Holder making a Collateral Substitution pursuant
to this Section 3.13 fails to effect a book-entry transfer of the Normal
Units or fails to deliver a Normal Units Certificate to the Agent after
depositing Treasury Securities with the Collateral Agent, the Pledged
Notes, Pledged Treasury Consideration or Pledged Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, constituting a part
of such Normal Units, and any distributions on such Pledged Notes, Pledged
Treasury Consideration or Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, shall be held in the name of the
Agent or its nominee in trust for the benefit of such Holder, until such
Normal Units are so transferred or the Normal Units Certificate
31
is so delivered, as the case may be, or, with respect to a Normal Units
Certificate, such Holder provides evidence satisfactory to the Company and
the Agent that such Normal Units Certificate has been destroyed, lost or
stolen, together with any indemnity that may be required by the Agent and
the Company.
(e) Except as described in this Section 3.13, for so long as the
Purchase Contract underlying a Normal Unit remains in effect, such Normal
Unit shall not be separable into its constituent parts, and the rights and
obligations of the Holder of such Normal Unit in respect of the Note or the
appropriate Treasury Consideration, as the case may be, and the Purchase
Contract comprising such Normal Unit may be acquired, and may be
transferred and exchanged, only as a Normal Unit.
SECTION 3.14 REESTABLISHMENT OF NORMAL UNITS.
(a) A Holder of Stripped Units may reestablish Normal Units at any
time from and after the date of this Agreement and on or prior to the
second Business Day immediately preceding the Stock Purchase Date, by (i)
depositing with the Collateral Agent the Notes or the appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury Portfolio
(identified and calculated by reference to the Treasury Consideration then
comprising Normal Units), as the case may be, then comprising such number
of Normal Units as is equal to such Stripped Units and (ii) transferring
such Stripped Units to the Agent accompanied by a notice to the Agent,
substantially in the form of Exhibit D hereto, stating that the Holder has
transferred the relevant amount of Notes or the appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury Portfolio,
as the case may be, to the Collateral Agent and requesting that the Agent
instruct the Collateral Agent to release the Pledged Treasury Securities
underlying such Stripped Unit, whereupon the Agent shall promptly give such
instruction to the Collateral Agent, substantially in the form of Exhibit C
hereto. Notwithstanding the foregoing, a Holder may not reestablish Normal
Units during the periods beginning on the fourth Business Day prior to any
Remarketing Period and ending on the third business day after the end of
such Remarketing Period. Upon receipt of the Notes or the appropriate
Treasury Consideration or Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, described in clause (i) above and the
instruction described in clause (ii) above, in accordance with the terms of
the Pledge Agreement, the Collateral Agent will release to the Agent, on
behalf of the Holder, such Pledged Treasury Securities from the Pledge,
free and clear of the Company's security interest therein, and upon receipt
thereof the Agent shall promptly:
(i) cancel the related Stripped Units;
(ii) transfer the Pledged Treasury Securities to the Holder; and
32
(iii) authenticate, execute on behalf of such Holder and deliver
a Normal Units Certificate executed by the Company in accordance with
Section 3.3 evidencing the same number of Purchase Contracts as were
evidenced by the cancelled Stripped Units.
(b) Holders of Stripped Units may reestablish Normal Units (i) only
in integral multiples of 20 Stripped Units for 20 Normal Units or (ii) if
the reestablishment occurs after the Remarketing Date (if such remarketing
is successful) or any Subsequent Remarketing Date, or after a Tax Event
Redemption, only in integral multiples of Stripped Units such that the
Treasury Consideration to be deposited and the Treasury Securities to be
released are in integral multiples of $1,000.
(c) Except as provided in this Section 3.14, for so long as the
Purchase Contract underlying a Stripped Unit remains in effect, such
Stripped Unit shall not be separable into its constituent parts, and the
rights and obligations of the Holder of such Stripped Unit in respect of
the Treasury Security and Purchase Contract comprising such Stripped Unit
may be acquired, and may be transferred and exchanged, only as a Stripped
Unit.
SECTION 3.15 TRANSFER OF COLLATERAL UPON OCCURRENCE OF TERMINATION
EVENT.
Upon the occurrence of a Termination Event and the transfer to the
Agent of the Notes, the appropriate Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio, or the Treasury Securities, as the
case may be, underlying the Normal Units and the Stripped Units pursuant to the
terms of the Pledge Agreement, the Agent shall request transfer instructions
with respect to such Notes or the appropriate Treasury Consideration or Treasury
Securities, as the case may be, from each Holder by written request mailed to
such Holder at its address as it appears in the Normal Units Register or the
Stripped Units Register, as the case may be. Upon book-entry transfer of the
Normal Units or Stripped Units or delivery of a Normal Units Certificate or
Stripped Units Certificate to the Agent with such transfer instructions, the
Agent shall transfer the Notes, the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, or Treasury Securities,
as the case may be, underlying such Normal Units or Stripped Units, as the case
may be, to such Holder by book-entry transfer, or other appropriate procedures,
in accordance with such instructions. In the event a Holder of Normal Units or
Stripped Units fails to effect such transfer or delivery, the Notes, the
appropriate Treasury Consideration or Applicable Ownership Interest in the
Treasury Portfolio, or Treasury Securities, as the case may be, underlying such
Normal Units or Stripped Units, as the case may be, and any distributions
thereon, shall be held in the name of the Agent or its nominee in trust for the
benefit of such Holder, until such Normal Units or Stripped Units are
transferred or the Normal Units Certificate or Stripped Units Certificate is
surrendered or such Holder provides satisfactory evidence that such Normal Units
Certificate or Stripped Units Certificate has been destroyed, lost
33
or stolen, together with any indemnity that may be required by the Agent and the
Company.
SECTION 3.16 NO CONSENT TO ASSUMPTION.
Each Holder of a Unit, by acceptance thereof, shall be deemed
expressly to have withheld any consent to the assumption under Section 365 of
the Bankruptcy Code or otherwise, of the Purchase Contract by the Company, any
receiver, liquidator or person or entity performing similar functions or its
trustee in the event that the Company becomes the debtor under the Bankruptcy
Code or subject to other similar state or federal law providing for
reorganization or liquidation.
ARTICLE IV
THE NOTES
SECTION 4.1 PAYMENT OF INTEREST; RIGHTS TO INTEREST PAYMENTS
PRESERVED; NOTICE.
(a) A payment on any Note, Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, which is
paid on any Payment Date shall, subject to receipt thereof by the Agent
from the Collateral Agent as provided by the terms of the Pledge Agreement,
be paid to the Person in whose name the Normal Units Certificate (or one or
more Predecessor Normal Units Certificates) of which such Note or the
appropriate Treasury Consideration or Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, is a part is registered at the
close of business on the Record Date for such Payment Date.
(b) Each Normal Units Certificate evidencing Notes delivered under
this Agreement upon registration of transfer of or in exchange for or in
lieu of any other Normal Units Certificate shall carry the rights to
interest accrued and unpaid, which were carried by the Notes underlying
such other Normal Units Certificate.
(c) In the case of any Normal Unit with respect to which Early
Settlement of the underlying Purchase Contract is effected on an Early
Settlement Date, Merger Early Settlement of the underlying Purchase
Contract is effected on a Merger Early Settlement Date, Cash Settlement is
effected on the Business Day immediately preceding the Stock Purchase Date,
or a Collateral Substitution is effected, in each case on a date that is
after any Record Date and on or prior to the next succeeding Payment Date,
payments on the Note or the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, underlying such Normal Unit otherwise payable on such Payment Date
shall be payable on such Payment Date notwithstanding such Early
Settlement, Merger Early Settlement, Cash Settlement or Collateral
Substitution,
34
as the case may be, and such payments shall, subject to receipt thereof by
the Agent, be payable to the Person in whose name the Normal Units
Certificate (or one or more Predecessor Normal Unit Certificates) was
registered at the close of business on the Record Date. Except as otherwise
expressly provided in the immediately preceding sentence, in the case of
any Normal Unit with respect to which Early Settlement, Merger Early
Settlement or Cash Settlement of the underlying Purchase Contract is
effected, or with respect to which a Collateral Substitution has been
effected, payments on the related Notes or payments on the appropriate
Treasury Consideration or Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, that would otherwise be payable after the
applicable Settlement Date or after such Collateral Substitution, as the
case may be, shall not be payable hereunder to the Holder of such Normal
Unit; provided, that to the extent that such Holder continues to hold the
Separate Notes that formerly comprised a part of such Holder's Normal
Units, such Holder shall be entitled to receive the payments on such
Separate Notes.
SECTION 4.2 NOTICE AND VOTING.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Pledged
Notes but only to the extent instructed by the Holders as described below. Upon
receipt of notice of any meeting at which holders of Notes are entitled to vote
or upon any solicitation of consents, waivers or proxies of holders of Notes,
the Agent shall, as soon as practicable thereafter, mail to the Holders of
Normal Units a notice (a) containing such information as is contained in the
notice or solicitation, (b) stating that each Holder on the record date set by
the Agent therefor (which, to the extent possible, shall be the same date as the
record date for determining the holders of Notes entitled to vote) shall be
entitled to instruct the Agent as to the exercise of the voting rights
pertaining to the Pledged Notes underlying their Normal Units and (c) stating
the manner in which such instructions may be given. Upon the written request of
the Holders of Normal Units on such record date, the Agent shall endeavor
insofar as practicable to vote or cause to be voted, in accordance with the
instructions set forth in such requests, the maximum number of Pledged Notes as
to which any particular voting instructions are received. In the absence of
specific instructions from the Holder of a Normal Unit, the Agent shall abstain
from voting the Pledged Note underlying such Normal Unit. The Company hereby
agrees, if applicable, to solicit Holders of Normal Units to timely instruct the
Agent in order to enable the Agent to vote such Pledged Notes.
SECTION 4.3 TAX EVENT REDEMPTION.
Upon the occurrence of a Tax Event Redemption prior to the successful
remarketing of the Notes, the Company may elect to instruct in writing the
Collateral Agent to apply, and upon such written instruction, the Collateral
Agent shall apply, out of the aggregate Redemption Price for the Notes that are
components of Normal Units, an amount equal to the aggregate Tax Event
Redemption Principal Amount for the Notes
35
that are components of Normal Units to purchase on behalf of the Holders of
Normal Units the Treasury Portfolio and promptly remit the remaining portion of
such Redemption Price to the Agent for payment to the Holders of such Normal
Units. The Treasury Portfolio will be substituted for the Pledged Notes, and
will be pledged to the Collateral Agent in accordance with the terms of the
Pledge Agreement to secure the obligation of each Holder of a Normal Unit to
purchase the Common Stock under the Purchase Contract constituting a part of
such Normal Unit. Following the occurrence of a Tax Event Redemption prior to a
successful remarketing of the Notes, the Holders of Normal Units and the
Collateral Agent shall have such security interests, rights and obligations with
respect to the Treasury Portfolio as the Holder of Normal Units and the
Collateral Agent had in respect of the Notes, as the case may be, subject to the
Pledge thereof as provided in Articles II, III, IV, V and VI of the Pledge
Agreement, and any reference herein or in the Certificates to the Note shall be
deemed to be a reference to such Treasury Portfolio and any reference herein or
in the Certificates to interest on the Notes shall be deemed to be a reference
to corresponding distributions on the Treasury Portfolio. The Company may cause
to be made in any Normal Unit Certificates thereafter to be issued such change
in phraseology and form (but not in substance) as may be appropriate to reflect
the substitution of the Treasury Portfolio for Notes as collateral.
The Company shall cause notice of any Tax Event Redemption to be
mailed, at least 30 calendar days but not more than 60 calendar days before such
Tax Event Redemption Date, to each Holder of Notes to be redeemed at its
registered address.
Upon the occurrence of a Tax Event Redemption after the successful
remarketing of the Notes, the Redemption Price will be payable in cash to the
holders of the Notes.
ARTICLE V
THE PURCHASE CONTRACTS; THE REMARKETING
SECTION 5.1 PURCHASE OF SHARES OF COMMON STOCK.
(a) Each Purchase Contract shall, unless an Early Settlement has
occurred in accordance with Section 5.9, or a Merger Early Settlement has
occurred in accordance with Section 5.10, obligate the Holder of the
related Unit to purchase, and the Company to sell, on the Stock Purchase
Date at a price equal to $50 (the "Purchase Price"), a number of newly
issued shares of Common Stock equal to the Settlement Rate unless, on or
prior to the Stock Purchase Date, there shall have occurred a Termination
Event with respect to the Unit of which such Purchase Contract is a part.
The "Settlement Rate" is equal to,
(i) if the Applicable Market Value (as defined below) is greater
than or equal to $21.08 (the "Threshold Appreciation Price"), 2.3719
shares of Common Stock per Purchase Contract,
36
(ii) if the Applicable Market Value is less than the Threshold
Appreciation Price, but is greater than $17.28, the number of shares
of Common Stock per Purchase Contract equal to the Stated Amount of
the related Unit divided by the Applicable Market Value, and
(iii) if the Applicable Market Value is equal to or less than
$17.28, 2.8935 shares of Common Stock per Purchase Contract,
in each case subject to adjustment as provided in Section 5.6 (and in each
case rounded upward or downward to the nearest 1/10,000th of a share). As
provided in Section 5.12, no fractional shares of Common Stock will be
issued upon settlement of Purchase Contracts.
(b) No fractional shares of Common Stock will be issued by the Company
with respect to the payment of Contract Adjustment Payments on the Stock
Purchase Date. In lieu of fractional shares otherwise issuable with respect
to such payment of Contract Adjustment Payments, the Holder will be
entitled to receive an amount in cash as provided in Section 5.12.
(c) The "Applicable Market Value" means the average of the Closing
Price per share of Common Stock on each of the 20 consecutive Trading Days
ending on the third Trading Day immediately preceding the Stock Purchase
Date. The "Closing Price" of the Common Stock on any date of determination
means the closing sale price (or, if no closing price is reported, the last
reported sale price) of the Common Stock on the New York Stock Exchange
(the "NYSE") on such date or, if the Common Stock is not listed for trading
on the NYSE on any such date, as reported in the composite transactions for
the principal United States securities exchange on which the Common Stock
is so listed, or if the Common Stock is not so listed on a United States
national or regional securities exchange, as reported by The Nasdaq Stock
Market, or, if the Common Stock is not so reported, the last quoted bid
price for the Common Stock in the over-the-counter market as reported by
the National Quotation Bureau or similar organization, or, if such bid
price is not available, the market value of the Common Stock on such date
as determined by a nationally recognized independent investment banking
firm retained for this purpose by the Company. A "Trading Day" means a day
on which the Common Stock (A) is not suspended from trading on any national
or regional securities exchange or association or over-the-counter market
at the close of business and (B) has traded at least once on the national
or regional securities exchange or association or over-the-counter market
that is the primary market for the trading of the Common Stock.
(d) Each Holder of a Unit, by its acceptance thereof, irrevocably
authorizes the Agent to enter into and perform the related Purchase
Contract on its behalf as its attorney-in-fact (including the execution of
Certificates on behalf of such Holder), agrees to be bound by the terms and
provisions thereof, covenants and
37
agrees to perform its obligations under such Purchase Contracts, and
consents to the provisions hereof, irrevocably authorizes the Agent as its
attorney-in-fact to enter into and perform the Pledge Agreement on its
behalf as its attorney-in-fact, and consents to and agrees to be bound by
the Pledge of the Notes, the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, or the Treasury
Securities, pursuant to the Pledge Agreement; provided that upon a
Termination Event, the rights of the Holder of such Unit under the Purchase
Contract may be enforced without regard to any other rights or obligations.
Each Holder of a Unit, by its acceptance thereof, further covenants and
agrees, that, to the extent and in the manner provided in Section 5.4 and
the Pledge Agreement, but subject to the terms thereof, payments in respect
of the Notes, the appropriate Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio, or the Treasury Securities to
be paid upon settlement of such Holder's obligations to purchase Common
Stock under the Purchase Contract, shall be paid on the Stock Purchase Date
by the Collateral Agent to the Company in satisfaction of such Holder's
obligations under such Purchase Contract.
(e) Upon registration of transfer of a Certificate, the transferee
shall be bound (without the necessity of any other action on the part of
such transferee) under the terms of this Agreement, the Purchase Contracts
underlying such Certificate and the Pledge Agreement, and the transferor
shall be released from the obligations under this Agreement, the Purchase
Contracts underlying the Certificates so transferred and the Pledge
Agreement. The Company covenants and agrees, and each Holder of a
Certificate, by its acceptance thereof, likewise covenants and agrees, to
be bound by the provisions of this paragraph.
SECTION 5.2 CONTRACT ADJUSTMENT PAYMENTS.
(a) Subject to Section 5.3 herein, the Company shall pay, on each
Payment Date, the Contract Adjustment Payments, if any, payable in respect
of each Purchase Contract to the Person in whose name a Certificate (or one
or more Predecessor Certificates) is registered at the close of business on
the Record Date next preceding such Payment Date in such coin or currency
of the United States as at the time of payment shall be legal tender for
payments. The Contract Adjustment Payments, if any, will be payable at the
New York Office maintained for that purpose or, at the option of the
Company, by check mailed to the address of the Person entitled thereto at
such Person's address as it appears on the Register or by wire transfer to
the account designated by a prior written notice by such Person.
(b) Upon the occurrence of a Termination Event, the Company's
obligation to pay Contract Adjustment Payments (including any accrued
Deferred Contract Adjustment Payments), if any, shall cease.
38
(c) Each Certificate delivered under this Agreement upon registration
of transfer of or in exchange for or in lieu of (including as a result of a
Collateral Substitution or the re-establishment of a Normal Unit) any other
Certificate shall carry the rights to Contract Adjustment Payments, if any,
accrued and unpaid, and to accrue Contract Adjustment Payments, if any,
which were carried by the Purchase Contracts underlying such other
Certificates.
(d) Subject to Sections 5.4, 5.9 and 5.10, in the case of any Unit
with respect to which Early Settlement or Merger Early Settlement of the
underlying Purchase Contract is effected on an Early Settlement Date, a
Merger Early Settlement Date, respectively, or in respect of which Cash
Settlement of the underlying Purchase Contract is effected on the Business
Day immediately preceding the Stock Purchase Date, or with respect to which
a Collateral Substitution or an establishment or re-establishment of a
Normal Unit pursuant to Section 3.14 is effected, in each case on a date
that is after any Record Date and on or prior to the next succeeding
Payment Date, Contract Adjustment Payments on the Purchase Contract
underlying such Unit otherwise payable on such Payment Date shall be
payable on such Payment Date notwithstanding such Cash Settlement, Early
Settlement, Merger Early Settlement, Collateral Substitution or
establishment or re-establishment of Normal Units, and such Contract
Adjustment Payments shall be paid to the Person in whose name the
Certificate evidencing such Unit (or one or more Predecessor Certificates)
is registered at the close of business on such Record Date. Except as
otherwise expressly provided in the immediately preceding sentence, in the
case of any Unit with respect to which Cash Settlement, Early Settlement or
Merger Early Settlement of the underlying Purchase Contract is effected on
the Business Day immediately preceding the Stock Purchase Date, an Early
Settlement Date or Merger Early Settlement Date, as the case may be, or
with respect to which a Collateral Substitution or an establishment or re-
establishment of a Normal Unit has been effected, Contract Adjustment
Payments, if any, that would otherwise be payable after the Early
Settlement Date, or Merger Early Settlement Date, Collateral Substitution
or such establishment or re-establishment with respect to such Purchase
Contract shall not be payable.
SECTION 5.3 DEFERRAL OF CONTRACT ADJUSTMENT PAYMENTS.
(a) The Company shall have the right, at any time prior to the Stock
Purchase Date, to defer the payment of any or all of the Contract
Adjustment Payments otherwise payable on any Payment Date, but only if the
Company shall give the Holders and the Agent written notice of its election
to defer each such deferred Contract Adjustment Payment (specifying the
amount to be deferred) at least ten Business Days prior to the earlier of
(i) the next succeeding Payment Date or (ii) the date the Company is
required to give notice of the Record Date or Payment Date with respect to
payment of such Contract Adjustment Payments to
39
the NYSE or other applicable self-regulatory organization or to Holders of
the Units, but in any event not less than one Business Day prior to such
Record Date. Any Contract Adjustment Payments so deferred shall, to the
extent permitted by law, bear additional Contract Adjustment Payments
thereon at the rate of 6.50% per year (computed on the basis of a 360-day
year of 12 30-day months), compounding on each succeeding Payment Date,
until paid in full (such deferred installments of Contract Adjustment
Payments, if any, together with the additional Contract Adjustment Payments
accrued thereon, being referred to herein as the "Deferred Contract
Adjustment Payments"). Deferred Contract Adjustment Payments, if any, shall
be due on the next succeeding Payment Date except to the extent that
payment is deferred pursuant to this Section 5.3. No Contract Adjustment
Payments may be deferred to a date that is after the Purchase Contract
Settlement Date and no such deferral period may end other than on a Payment
Date. If the Purchase Contracts are terminated upon the occurrence of a
Termination Event, the Holder's right to receive Contract Adjustment
Payments, if any, and Deferred Contract Adjustment Payments, will
terminate.
(b) In the event that the Company elects to defer the payment of
Contract Adjustment Payments on the Purchase Contracts until a Payment Date
prior to the Stock Purchase Date, then all Deferred Contract Adjustment
Payments, if any, shall be payable to the registered Holders as of the
close of business on the Record Date immediately preceding such Payment
Date.
(c) In the event that the Company elects to defer the payment of
Contract Adjustment Payments on the Purchase Contracts until the Stock
Purchase Date, each Holder will receive on the Stock Purchase Date in lieu
of a cash payment a number of shares of Common Stock (in addition to a
number of shares of Common Stock equal to the Settlement Rate) equal to (A)
the aggregate amount of Deferred Contract Adjustment Payments payable to
such Holder (net of any required tax withholding on such Deferred Contract
Adjustment Payment, which shall be remitted to the appropriate taxing
jurisdiction) divided by (B) the Applicable Market Value.
(d) No fractional shares of Common Stock will be issued by the Company
with respect to the payment of Deferred Contract Adjustment Payments on the
Stock Purchase Date. In lieu of fractional shares otherwise issuable with
respect to such payment of Deferred Contract Adjustment Payments, the
Holder will be entitled to receive an amount in cash as provided in Section
5.12.
(e) In the event the Company exercises its option to defer the payment
of Contract Adjustment Payments then, until the Deferred Contract
Adjustment Payments have been paid, the Company shall not declare or pay
dividends on, make distributions with respect to, or redeem, purchase or
acquire, or make a liquidation payment with respect to, any of the
Company's Capital Stock other than:
40
(i) purchases, redemptions or acquisitions of shares of Capital
Stock of the Company in connection with any employment contract,
benefit plan or other similar arrangement with or for the benefit of
employees, officers or directors or a stock purchase or dividend
reinvestment plan, or the satisfaction by the Company of its
obligations pursuant to any contract or security outstanding on the
date the Company exercises its right to defer the Contract Adjustment
Payments;
(ii) as a result of a reclassification of the Company's Capital
Stock or the exchange or conversion of one class or series of the
Company's Capital Stock for another class or series of the Company's
Capital Stock;
(iii) the purchase of fractional interests of the Company's
Capital Stock pursuant to the conversion or exchange provisions of
such Capital Stock or the security being converted or exchanged;
(iv) dividends or distributions in any series of the Company's
Capital Stock (or rights to acquire Capital Stock) or repurchases,
acquisitions or redemptions of Capital Stock in connection with the
issuance of exchange of any series of the Company's Capital Stock (or
securities convertible into or exchangeable for shares of the
Company's Capital Stock); or
(v) redemptions, exchanges or repurchases of any rights
outstanding under a shareholder rights plan or the declaration or
payment thereunder of a dividend or distribution of or with respect to
rights in the future.
SECTION 5.4 PAYMENT OF PURCHASE PRICE: REMARKETING.
(a) Unless a Tax Event Redemption, successful remarketing, Termination
Event, Merger Early Settlement or Early Settlement has occurred, each
Holder of a Normal Unit may pay in cash ("Cash Settlement") the Purchase
Price for the shares of Common Stock to be purchased pursuant to a Purchase
Contract if such Holder notifies the Agent by use of a notice in
substantially the form of Exhibit E hereto of its intention to make a Cash
Settlement. Such notice shall be made on or prior to 5:00 p.m., New York
City time, on the seventh Business Day immediately preceding the Stock
Purchase Date. The Agent shall promptly notify the Collateral Agent of the
receipt of such a notice from a Holder intending to make a Cash Settlement.
(i) A Holder of a Normal Unit who has so notified the Agent of
its intention to make a Cash Settlement is required to pay the
Purchase Price to the Collateral Agent prior to 11:00 a.m., New York
City time, on the Business Day immediately preceding the Stock
Purchase Date in
41
lawful money of the United States by certified or cashiers' check or
wire transfer, in each case payable to or upon the order of the
Company. Any cash received by the Collateral Agent will be paid to the
Company on the Stock Purchase Date in settlement of the Purchase
Contract in accordance with the terms of this Agreement and the Pledge
Agreement.
(ii) If a Holder of a Normal Unit fails to notify the Agent of
its intention to make a Cash Settlement in accordance with paragraph
(a)(i) above, such failure shall constitute an event of default and
the Holder shall be deemed to have consented to the disposition of the
Pledged Notes pursuant to the remarketing as described in paragraph
(b) below. If a Holder of a Normal Units does notify the Agent as
provided in paragraph (a)(i) above of its intention to pay the
Purchase Price in cash, but fails to make such payment as required by
paragraph (a)(i) above, such failure shall also constitute a default;
however, the Notes of such a Holder will not be remarketed but instead
the Collateral Agent, for the benefit of the Company, will exercise
its rights as a secured party with respect to such Notes, including
but not limited to those rights specified in subsection (b)(iii)
below.
(b) (i) The Company shall engage a nationally recognized investment
bank (the "Remarketing Agent") pursuant to a Remarketing Agreement to be
mutually agreed on by the Company, the Agent and the Remarketing Agent, but
substantially as set forth below, to sell the Notes of Holders of Normal
Units, other than Holders that have elected not to participate in the
remarketing pursuant to the procedures set forth in clause (iv) below and
holders of Separate Notes that have elected to participate in the
remarketing pursuant to the procedures set forth in Section 4.5(d) of the
Pledge Agreement. On the seventh day prior to the Remarketing Date, the
Agent shall give Holders of Normal Units and holders of Separate Notes
notice of the remarketing in a daily newspaper in the English language of
general circulation in The City of New York, which is expected to be The
Wall Street Journal, including the specific U.S. Treasury security or
securities (including the CUSIP number and/or the principal terms of such
Treasury security or securities) described in clause (iv) below, that must
be delivered by Holders of Normal Units that elect not to participate in
the remarketing pursuant to clause (iv) below, no later than 10:00 a.m. on
the fourth Business Day preceding the Remarketing Date. The Agent shall
notify, by 10:00 a.m., New York City time, on the third Business Day
preceding the Remarketing Date, the Remarketing Agent and the Collateral
Agent of the aggregate number of Notes of Normal Unit Holders to be
remarketed. On the third Business Day preceding the Remarketing Date, no
later than by 10:00 a.m. New York City time, pursuant to the terms of the
Pledge Agreement, the Custodial Agent will notify the Remarketing Agent of
42
the aggregate number of Separate Notes to be remarketed. On the Business
Day immediately preceding the Remarketing Date, the Collateral Agent and
the Custodial Agent, pursuant to the terms of the Pledge Agreement, will
deliver for remarketing to the Remarketing Agent all Notes to be
remarketed. Upon receipt of such notice from the Agent and the Custodial
Agent and such Notes from the Collateral Agent and the Custodial Agent, the
Remarketing Agent will, on the third Business Day following the Remarketing
Date, use its reasonable best efforts to sell such Notes on such date at a
price equal to 100.5% of the Remarketing Value. The Remarketing Agent will
use the proceeds from a successful remarketing to purchase the appropriate
U.S. Treasury securities (the "Agent-purchased Treasury Consideration")
with the CUSIP numbers, if any, selected by the Remarketing Agent,
described in clauses (i) and (ii) of the definition of Remarketing Value
related to the Notes of Holders of Normal Units that were remarketed. On or
prior to the third Business Day following the Remarketing Date, the
Remarketing Agent shall deliver such Agent-purchased Treasury Consideration
to the Agent, which shall thereupon deliver such Agent-purchased Treasury
Consideration to the Collateral Agent. The Collateral Agent, for the
benefit of the Company, will thereupon apply such Agent-purchased Treasury
Consideration, in accordance with the Pledge Agreement, to secure such
Holders' obligations under the Purchase Contracts. The Remarketing Agent
will deduct as a remarketing fee an amount not exceeding 25 basis points
(.25%) of the total proceeds from the remarketing (the "Remarketing Fee").
The Remarketing Agent will remit (1) the portion of the proceeds from the
remarketing attributable to the Separate Notes to the holders of Separate
Notes that were remarketed and (2) the remaining portion of the proceeds,
less those proceeds used to purchase the Agent-purchased Treasury
Consideration, to the Holders of the Normal Units that were remarketed, all
determined on a pro rata basis, in each case, on or prior to the third
Business Day following the Remarketing Date. Holders whose Notes are so
remarketed will not otherwise be responsible for the payment of any
Remarketing Fee in connection therewith.
(ii) If, in spite of using its commercially reasonable best
efforts, the Remarketing Agent cannot remarket the Notes included in
the remarketing at a price equal to at least 100.5% of the Remarketing
Value, the Remarketing Agent will attempt to establish a Remarketing
Rate meeting these requirements on each of the two immediately
following Business Days. If the Remarketing Agent cannot establish a
Remarketing Rate meeting these requirements on either of those days,
it will attempt to establish such a Remarketing Rate on each of the
three Business Days immediately preceding October 1, 2004. If the
Remarketing Agent cannot establish such a Remarketing Rate either on
any of the two Business Days immediately following the Remarketing
Date or on any of the three Business Days immediately preceding
October 1, 2004, the remarketing in each such period will be deemed to
have failed (each, a "Failed Remarketing"). If the Remarketing Agent
cannot establish such a Remarketing Rate on
43
any of the three Business Days immediately preceding October 1, 2004,
the Remarketing Agent will further attempt to establish such a
Remarketing Rate on each of the three Business Days immediately
preceding the Stock Purchase Date. If, in spite of using its
commercially reasonable best efforts, the Remarketing Agent fails to
remarket the Notes underlying the Normal Units at 100.5% of the
Remarketing Value in accordance with the terms of the Pledge Agreement
by 4:00 p.m., New York City time, on the Business Day immediately
preceding the Stock Purchase Date, the "Last Failed Remarketing" will
be deemed to have occurred. In this case, within three Business Days
following the date of the Last Failed Remarketing, the Remarketing
Agent shall return any Notes delivered to it to the Collateral Agent.
The Collateral Agent, for the benefit of the Company, may exercise its
rights as a secured party with respect to such Notes, including those
actions specified in subsection (b) (iii) below; provided, that if
upon the Last Failed Remarketing, the Collateral Agent exercises such
rights for the benefit of the Company with respect to such Notes, any
accumulated and unpaid interest on such Notes will become payable by
the Company to the Agent for payment to the Holder of the Normal Units
to which such Notes relate. Such payment will be made by the Company
on or prior to 11 a.m., New York City time, on the Stock Purchase Date
in lawful money of the United States by certified or cashier's check
or wire transfer in immediately available funds payable to or upon the
order of the Agent. The Company will cause a notice of any Failed
Remarketing and of the Last Failed Remarketing to be published on the
fourth Business Day following the Remarketing Date and the date of the
Last Failed Remarketing and any Subsequent Remarketing Date and the
date of the Last Failed Remarketing, as the case may be, in a daily
newspaper in the English language of general circulation in The City
of New York, which is expected to be The Wall Street Journal. The
Company will also release this information by means of Bloomberg and
Reuters newswire.
(iii) With respect to any Notes which constitute part of Normal
Units which are subject to the Last Failed Remarketing, the Collateral
Agent for the benefit of the Company reserves all of its rights as a
secured party with respect thereto and, subject to applicable law and
Section 5.4 (e) below, may, among other things, retain such Notes in
full satisfaction of the Holders' obligations under the Purchase
Contracts.
(iv) A Holder of Normal Units may elect not to participate in the
remarketing and retain the Notes underlying such Units by notifying
the Agent of such election and delivering the specific U.S. Treasury
security or securities (including the CUSIP number and/or the
principal terms of such security or securities) identified by the
Agent that constitute the U.S. Treasury securities described in
clauses (i) and (ii) of the
44
definition of Remarketing Value relating to the retained Notes (as if
only such Notes were being remarketed) (the "Opt-out Treasury
Consideration") to the Agent not later than 10:00 a.m. on the fourth
Business Day prior to the Remarketing Date (or, in the case of a
Failed Remarketing, not later than 10:00 a.m. on the Business Day
immediately prior to the Subsequent Remarketing Date). Upon receipt
thereof by the Agent, the Agent shall deliver such Opt-out Treasury
Consideration to the Collateral Agent, which will, for the benefit of
the Company, thereupon apply such Opt-out Treasury Consideration to
secure such Holder's obligations under the Purchase Contracts. On the
first Business Day immediately preceding the Remarketing Date, the
Collateral Agent, pursuant to the terms of the Pledge Agreement, will
deliver the Pledged Notes of such Holder to the Agent. Within three
Business Days following the Remarketing Date, (A) if the remarketing
was successful, the Agent shall distribute such Notes to the Holders
thereof, and (B) if there was a Failed Remarketing on such date, the
Agent will deliver such Notes to the Collateral Agent, which will, for
the benefit of the Company, thereupon apply such Notes to secure such
Holders' obligations under the Purchase Contract and return the Opt-
out Treasury Consideration delivered by such Holders to such Holders.
A Holder that does not so deliver the Opt-out Treasury Consideration
pursuant to this clause (iv) shall be deemed to have elected to
participate in the remarketing.
(c) Upon the maturity of the Pledged Treasury Securities underlying
the Stripped Units and the Pledged Treasury Consideration or Pledged
Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, underlying the Normal Units, on the Stock Purchase Date, the Collateral
Agent shall remit to the Company an amount equal to the aggregate Purchase
Price applicable to such Units, as payment for the Common Stock issuable
upon settlement thereof without receiving any instructions from the Holders
of such Units. In the event the payments in respect of the Pledged Treasury
Securities, Pledged Treasury Consideration or Pledged Applicable Ownership
Interest in the Treasury Portfolio underlying a Unit is in excess of the
Purchase Price of the Purchase Contract being settled thereby, the
Collateral Agent will distribute such excess to the Agent for the benefit
of the Holder of such Unit when received.
(d) Any distribution to Holders of excess funds and interest described
in Section 5.4 (b) and (c) above shall be payable at the office of the
Agent in The City of Wilmington, Delaware maintained for that purpose or,
at the option of the Holder or the holder of Separate Notes, as applicable,
by check mailed to the address of the Person entitled thereto at such
address as it appears on the Register or by wire transfer to an account
specified by the Holder or the holder of Separate Notes, as applicable.
45
(e) The obligations of each Holder to pay the Purchase Price are non-
recourse obligations and except to the extent paid by Early Settlement or
Merger Early Settlement, are payable solely out of the proceeds of any
Collateral pledged to secure the obligations of the Holders and in no event
will Holders be liable for any deficiency between such payments and the
Purchase Price.
(f) Notwithstanding anything to the contrary herein, the Company shall
not be obligated to issue any Common Stock in respect of a Purchase
Contract or deliver any certificates therefor to the Holder of the related
Unit unless the Company shall have received payment in full of the
aggregate Purchase Price for the shares of Common Stock to be purchased
thereunder by such Holder in the manner herein set forth.
SECTION 5.5 ISSUANCE OF SHARES OF COMMON STOCK.
Unless a Termination Event shall have occurred on or prior to the
Stock Purchase Date or an Early Settlement or a Merger Early Settlement shall
have occurred, on the Stock Purchase Date, upon its receipt of payment in full
of the Purchase Price for the shares of Common Stock purchased by the Holders
pursuant to the foregoing provisions of this Article and subject to Section
5.6(b), the Company shall issue and deposit with the Agent, for the benefit of
the Holders of the Outstanding Units, one or more certificates representing the
newly issued shares of Common Stock registered in the name of the Agent (or its
nominee) as custodian for the Holders (such certificates for shares of Common
Stock, together with any dividends or distributions for which a record date and
payment date for such dividend or distribution has occurred after the Stock
Purchase Date, being hereinafter referred to as the "Purchase Contract
Settlement Fund") to which the Holders are entitled hereunder. Subject to the
foregoing, upon surrender of a Certificate to the Agent on or after the Stock
Purchase Date, together with settlement instructions thereon duly completed and
executed, the Holder of such Certificate shall be entitled to receive in
exchange therefor a certificate representing that number of whole shares of
Common Stock which such Holder is entitled to receive pursuant to the provisions
of this Article V (after taking into account all Units then held by such Holder)
together with cash in lieu of fractional shares as provided in Section 5.12 and
any dividends or distributions with respect to such shares constituting part of
the Purchase Contract Settlement Fund, but without any interest thereon, and the
Certificate so surrendered shall forthwith be cancelled. Such shares shall be
registered in the name of the Holder or the Holder's designee as specified in
the settlement instructions provided by the Holder to the Agent. If any shares
of Common Stock issued in respect of a Purchase Contract are to be registered to
a Person other than the Person in whose name the Certificate evidencing such
Purchase Contract is registered, no such registration shall be made unless the
Person requesting such registration has paid any transfer and other taxes
required by reason of such registration in a name other than that of the
registered Holder of such Certificate or has established to the satisfaction of
the Company that such tax either has been paid or is not payable.
46
SECTION 5.6 ADJUSTMENT OF SETTLEMENT RATE.
(a) Adjustments for Dividends, Distributions, Stock Splits, Etc.
(1) Stock Dividends. In case the Company shall pay or make a
dividend or other distribution on the Common Stock in Common Stock,
the Settlement Rate, as in effect at the opening of business on the
day following the date fixed for the determination of stockholders
entitled to receive such dividend or other distribution shall be
increased by dividing such Settlement Rate by a fraction of which the
numerator shall be the number of shares of Common Stock outstanding at
the close of business on the date fixed for such determination and the
denominator shall be the sum of such number of shares and the total
number of shares constituting such dividend or other distribution,
such increase to become effective immediately after the opening of
business on the day following the date fixed for such determination.
For the purposes of this paragraph (1), the number of shares of Common
Stock at the time outstanding shall not include shares held in the
treasury of the Company but shall include any shares issuable in
respect of any scrip certificates issued in lieu of fractions of
shares of Common Stock. The Company will not pay any dividend or make
any distribution on shares of Common Stock held in the treasury of the
Company.
(2) Stock Purchase Rights. In case the Company shall issue
rights, options or warrants to all holders of its Common Stock (not
being available on an equivalent basis to Holders of the Units upon
settlement of the Purchase Contracts underlying such Units) entitling
them to subscribe for or purchase shares of Common Stock at a price
per share less than the Current Market Price per share of the Common
Stock on the date fixed for the determination of stockholders entitled
to receive such rights, options or warrants (other than pursuant to a
dividend reinvestment, share purchase or similar plan), the Settlement
Rate in effect at the opening of business on the day following the
date fixed for such determination shall be increased by dividing such
Settlement Rate by a fraction, the numerator of which shall be the
number of shares of Common Stock outstanding at the close of business
on the date fixed for such determination plus the number of shares of
Common Stock which the aggregate of the offering price of the total
number of shares of Common Stock so offered for subscription or
purchase would purchase at such Current Market Price and the
denominator of which shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock so offered for
subscription or purchase, such increase to become effective
immediately after the opening of business on the day following the
date fixed for such determination. For the purposes of this paragraph
(2), the number of
47
shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include any
shares issuable in respect of any scrip certificates issued in lieu of
fractions of shares of Common Stock. The Company shall not issue any
such rights, options or warrants in respect of shares of Common Stock
held in the treasury of the Company.
(3) Stock Splits; Reverse Splits. In case outstanding shares of
Common Stock shall be subdivided or split into a greater number of
shares of Common Stock, the Settlement Rate in effect at the opening
of business on the day following the day upon which such subdivision
or split becomes effective shall be proportionately increased, and,
conversely, in case outstanding shares of Common Stock shall each be
combined into a smaller number of shares of Common Stock, the
Settlement Rate in effect at the opening of business on the day
following the day upon which such combination becomes effective shall
be proportionately reduced, such increase or reduction, as the case
may be, to become effective immediately after the opening of business
on the day following the day upon which such subdivision, split or
combination becomes effective.
(4) Debt or Asset Distributions. (i) In case the Company shall,
by dividend or otherwise, distribute to all holders of its Common
Stock evidences of its indebtedness or assets (including securities,
but excluding any rights or warrants referred to in paragraph (2) of
this Section, any dividend or distribution paid exclusively in cash
and any dividend, shares of capital stock of any class or series, or
similar equity interests, of or relating to a subsidiary or other
business unit in the case of a Spin-Off referred to in the next
paragraph, or distribution referred to in paragraph (1) of this
Section), the Settlement Rate shall be adjusted so that the same shall
equal the rate determined by dividing the Settlement Rate in effect
immediately prior to the close of business on the date fixed for the
determination of stockholders entitled to receive such distribution by
a fraction, the numerator of which shall be the Current Market Price
per share of the Common Stock on the date fixed for such determination
less the then fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a
Board Resolution filed with the Agent) of the portion of the assets or
evidences of indebtedness so distributed applicable to one share of
Common Stock and the denominator of which shall be such Current Market
Price per share of the Common Stock, such adjustment to become
effective immediately prior to the opening of business on the day
following the date fixed for the determination of stockholders
entitled to receive such distribution. In any case in which this
paragraph (4) is applicable, paragraph (2) of this Section shall not
be applicable.
48
(ii) In the case of a Spin-Off, the Settlement Rate in effect
immediately before the close of business on the record date fixed for
determination of stockholders entitled to receive that distribution
will be increased by multiplying the Settlement Rate by a fraction,
the numerator of which is the Current Market Price per share of the
Common Stock plus the Fair Market Value of the portion of those shares
of Capital Stock or similar equity interests so distributed applicable
to one share of Common Stock and the denominator of which is the
Current Market Price per share of the Common Stock. Any adjustment to
the settlement rate under the this paragraph 4(ii) will occur at the
earlier of (1) the tenth Trading Day from, and including, the
effective date of the Spin-Off and (2) the date of the securities
being offered in the Initial Public Offering of the Spin-Off, if that
Initial Public Offering is effected simultaneously with the Spin-Off.
(5) Cash Distributions. In case the Company shall, (i) by
dividend or otherwise, distribute to all holders of its Common Stock
cash (excluding any cash that is distributed in a Reorganization Event
to which Section 5.6(b) applies or as part of a distribution referred
to in paragraph (4) of this Section) in an aggregate amount that,
combined together with (ii) the aggregate amount of any other
distributions to all holders of its Common Stock made exclusively in
cash within the 12 months preceding the date of payment of such
distribution and in respect of which no adjustment pursuant to this
paragraph (5) or paragraph (6) of this Section has been made and (iii)
the aggregate of any cash plus the fair market value as of the date of
the expiration of the tender or exchange offer referred to below (as
determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) of consideration
payable in respect of any tender or exchange offer by the Company or
any of its subsidiaries for all or any portion of the Common Stock
concluded within the 12 months preceding the date of payment of the
distribution described in clause (i) above and in respect of which no
adjustment pursuant to this paragraph (5) or paragraph (6) of this
Section has been made, exceeds 15% of the product of the Current
Market Price per share of the Common Stock on the date for the
determination of holders of shares of Common Stock entitled to receive
such distribution times the number of shares of Common Stock
outstanding on such date, then, and in each such case, immediately
after the close of business on such date for determination, the
Settlement Rate shall be increased so that the same shall equal the
rate determined by dividing the Settlement Rate in effect immediately
prior to the close of business on the date fixed for determination of
the stockholders entitled to receive such distribution by a fraction
(A) the numerator of which shall be equal to the Current Market Price
per share of the Common Stock on the date fixed for such determination
less an amount equal to the quotient of (x) the combined amount
distributed or payable in the transactions described in clauses (i),
49
(ii) and (iii) above and (y) the number of shares of Common Stock
outstanding on such date for determination and (B) the denominator of
which shall be equal to the Current Market Price per share of the
Common Stock on such date for determination.
(6) Tender Offers. In case (i) a tender or exchange offer made by
the Company or any subsidiary of the Company for all or any portion of
the Common Stock shall expire and such tender or exchange offer (as
amended upon the expiration thereof) shall require the payment to
stockholders (based on the acceptance (up to any maximum specified in
the terms of the tender or exchange offer) of Purchased Shares) of an
aggregate consideration having a fair market value (as determined by
the Board of Directors, whose determination shall be conclusive and
described in a Board Resolution) that combined together with (ii) the
aggregate of the cash plus the fair market value (as determined by the
Board of Directors, whose determination shall be conclusive and
described in a Board Resolution), as of the expiration of such tender
or exchange offer, of consideration payable in respect of any other
tender or exchange offer, by the Company or any subsidiary of the
Company for all or any portion of the Common Stock expiring within the
12 months preceding the expiration of such tender or exchange offer
and in respect of which no adjustment pursuant to paragraph (5) of
this Section or this paragraph (6) has been made and (iii) the
aggregate amount of any distributions to all holders of the Company's
Common Stock made exclusively in cash within the 12 months preceding
the expiration of such tender or exchange offer and in respect of
which no adjustment pursuant to paragraph (5) of this Section or this
paragraph (6) has been made, exceeds 15% of the product of the Current
Market Price per share of the Common Stock as of the last time (the
"Expiration Time") tenders could have been made pursuant to such
tender or exchange offer (as it may be amended) times the number of
shares of Common Stock outstanding (including any tendered shares) on
the Expiration Time, then, and in each such case, immediately prior to
the opening of business on the day after the date of the Expiration
Time, the Settlement Rate shall be adjusted so that the same shall
equal the rate determined by dividing the Settlement Rate immediately
prior to the close of business on the date of the Expiration Time by a
fraction (A) the numerator of which shall be equal to (x) the product
of (I) the Current Market Price per share of the Common Stock on the
date of the Expiration Time and (II) the number of shares of Common
Stock outstanding (including any tendered shares) on the Expiration
Time less (y) the amount of cash plus the fair market value
(determined as aforesaid) of the aggregate consideration payable to
stockholders based on the transactions described in clauses (i), (ii)
and (iii) above (assuming in the case of clause (i) the acceptance, up
to any maximum specified in the terms of the tender or exchange offer,
of Purchased Shares), and (B) the denominator of
50
which shall be equal to the product of (x) the Current Market Price
per share of the Common Stock as of the Expiration Time and (y) the
number of shares of Common Stock outstanding (including any tendered
shares) as of the Expiration Time less the number of all shares
validly tendered and not withdrawn as of the Expiration Time (the
shares deemed so accepted, up to any such maximum, being referred to
as the "Purchased Shares").
(7) Reclassification. The reclassification of Common Stock into
securities including securities other than Common Stock (other than
any reclassification upon a Reorganization Event to which Section
5.6(b) applies) shall be deemed to involve (i) a distribution of such
securities other than Common Stock to all holders of Common Stock (and
the effective date of such reclassification shall be deemed to be "the
date fixed for the determination of stockholders entitled to receive
such distribution" and the "date fixed for such determination" within
the meaning of paragraph (4) of this Section), and (ii) a subdivision,
split or combination, as the case may be, of the number of shares of
Common Stock outstanding immediately prior to such reclassification
into the number of shares of Common Stock outstanding immediately
thereafter (and the effective date of such reclassification shall be
deemed to be "the day upon which such subdivision or split becomes
effective" or "the day upon which such combination becomes effective,"
as the case may be, and "the day upon which such subdivision, split or
combination becomes effective" within the meaning of paragraph (3) of
this Section).
(8) "Current Market Price". The "Current Market Price" of the
Common Stock means (a) on any day the average of the Sales Prices for
the 5 consecutive Trading Day preceding the earlier of the day
preceding the day in question and the day before the "ex date" with
respect to the issuance or distribution requiring computation, (b) in
the case of any Spin-Off that is effected simultaneously with and
Initial Public Offering of the securities being distributed in the
Spin-Off, the Sale Price of the Common Stock on the Trading Day on
which the initial public offering price of the securities being
distributed in the Spin-Off is determined, and (c) in the case of any
other Spin-Off, the average of the Sale Prices of the Common Stock
over the first 10 Trading Days after the effective date of such Spin-
Off. For purposes of this paragraph, the term "ex date," when used
with respect to any issuance or distribution, shall mean the first
date on which the Common Stock trades regular way on such exchange or
in such market without the right to receive such issuance or
distribution.
(9) Calculation of Adjustments. All adjustments to the Settlement
Rate shall be calculated to the nearest 1/10,000th of a share of
Common Stock (or if there is not a nearest 1/10,000th of a share to
the next lower 1/10,000th of a share). No adjustment in the Settlement
Rate
51
shall be required unless such adjustment would require an increase or
decrease of at least one percent therein; provided, that any
adjustments which by reason of this subparagraph are not required to
be made shall be carried forward and taken into account in any
subsequent adjustment. If an adjustment is made to the Settlement Rate
pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of
this Section 5.6(a), an adjustment shall also be made to the
Applicable Market Value solely to determine which of clauses (i), (ii)
or (iii) of the definition of Settlement Rate in Section 5.1(a) will
apply on the Stock Purchase Date. Such adjustment shall be made by
multiplying the Applicable Market Value by a fraction, the numerator
of which shall be the Settlement Rate immediately after such
adjustment pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or
(10) of this Section 5.6(a) and the denominator of which shall be the
Settlement Rate immediately before such adjustment; provided, that if
such adjustment to the Settlement Rate is required to be made pursuant
to the occurrence of any of the events contemplated by paragraph (1),
(2), (3), (4), (5), (7) or (10) of this Section 5.6(a) during the
period taken into consideration for determining the Applicable Market
Value, appropriate and customary adjustments shall be made to the
Settlement Rate.
(10) Increase of Settlement Rate. The Company may make such
increases in the Settlement Rate, in addition to those required by
this Section, as it considers to be advisable in order to avoid or
diminish any income tax to any holders of shares of Common Stock
resulting from any dividend or distribution of stock or issuance of
rights or warrants to purchase or subscribe for stock or from any
event treated as such for income tax purposes or for any other
reasons.
(b) Adjustment for Consolidation, Merger or Other Reorganization
Event.
In the event of
(1) any consolidation or merger of the Company with or into
another Person (other than a merger or consolidation in which the
Company is the continuing corporation and in which the Common Stock
outstanding immediately prior to the merger or consolidation is not
exchanged for cash, securities or other property of the Company or
another corporation),
(2) any sale, transfer, lease or conveyance to another Person of
the property of the Company as an entirety or substantially as an
entirety,
(3) any statutory exchange of securities of the Company with
another Person (other than in connection with a merger or
acquisition), or
52
(4) any liquidation, dissolution or winding up of the Company
other than as a result of or after the occurrence of a Termination
Event
(any such event, a "Reorganization Event"),
each share of Common Stock covered by each Purchase Contract forming a part of a
Unit immediately prior to such Reorganization Event shall, after such
Reorganization Event, be converted for purposes of the Purchase Contract into
the kind and amount of securities, cash and other property receivable in such
Reorganization Event (without any interest thereon, and without any right to
dividends or distribution thereon which have a record date that is prior to the
Stock Purchase Date) per share of Common Stock by a holder of Common Stock that
(i) is not a Person with which the Company consolidated or into which the
Company merged or which merged into the Company or to which such sale or
transfer was made, as the case may be (any such Person, a "Constituent Person"),
or an Affiliate of a Constituent Person to the extent such Reorganization Event
provides for different treatment of Common Stock held by Affiliates of the
Company and non-Affiliates, and (ii) failed to exercise his rights of election,
if any, as to the kind or amount of securities, cash and other property
receivable upon such Reorganization Event (provided that if the kind or amount
of securities, cash and other property receivable upon such Reorganization Event
is not the same for each share of Common Stock held immediately prior to such
Reorganization Event by other than a Constituent Person or an Affiliate thereof
and in respect of which such rights of election shall not have been exercised
("Non-electing Share"), then for the purpose of this Section the kind and amount
of securities, cash and other property receivable upon such Reorganization Event
by each Non-electing Share shall be deemed to be the kind and amount so
receivable per share by a plurality of the Non-electing Shares). On the Stock
Purchase Date, the Settlement Rate then in effect will be applied to the value
on the Stock Purchase Date of such securities, cash or other property.
In the event of such a Reorganization Event, the Person formed by such
consolidation, merger or exchange or the Person which acquires the assets of the
Company or, in the event of a liquidation or dissolution of the Company, the
Company or a liquidating trust created in connection therewith, shall execute
and deliver to the Agent an agreement supplemental hereto providing that the
Holder of each Outstanding Unit shall have the rights provided by this Section
5.6. Such supplemental agreement shall provide for adjustments which, for events
subsequent to the effective date of such supplemental agreement, shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Section. The above provisions of this Section shall similarly apply to
successive Reorganization Events.
SECTION 5.7 NOTICE OF ADJUSTMENTS AND CERTAIN OTHER EVENTS.
(a) Whenever the Settlement Rate is adjusted as herein provided, the
Company shall:
53
(i) forthwith compute the Settlement Rate in accordance with
Section 5.6 and prepare and transmit to the Agent an Officer's
Certificate setting forth the Settlement Rate, the method of
calculation thereof in reasonable detail, and the facts requiring such
adjustment and upon which such adjustment is based; and
(ii) as soon as practicable following the occurrence of an event
that requires an adjustment to the Settlement Rate pursuant to Section
5.6 (or if the Company is not aware of such occurrence, as soon as
practicable after becoming so aware), provide a written notice to the
Holders of the Units of the occurrence of such event and a statement
in reasonable detail setting forth the method by which the adjustment
to the Settlement Rate was determined and setting forth the adjusted
Settlement Rate.
(b) The Agent shall not at any time be under any duty or
responsibility to any Holder of Units to determine whether any facts exist
which may require any adjustment of the Settlement Rate, or with respect to
the nature or extent or calculation of any such adjustment when made, or
with respect to the method employed in making the same. The Agent shall not
be accountable with respect to the validity or value (or the kind or
amount) of any shares of Common Stock, or of any securities or property,
which may at the time be issued or delivered with respect to any Purchase
Contract; and the Agent makes no representation with respect thereto. The
Agent shall not be responsible for any failure of the Company to issue,
transfer or deliver any shares of Common Stock pursuant to a Purchase
Contract or to comply with any of the duties, responsibilities or covenants
of the Company contained in this Article.
SECTION 5.8 TERMINATION EVENT; NOTICE.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including the rights and obligations of Holders to
purchase Common Stock, shall immediately and automatically terminate, without
the necessity of any notice or action by any Holder, the Agent or the Company,
if, on or prior to the Stock Purchase Date, a Termination Event shall have
occurred. Upon and after the occurrence of a Termination Event, the Normal Units
shall thereafter represent the right to receive the Notes or the appropriate
Treasury Consideration or Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, forming a part of such Normal Units, and the
Stripped Units shall thereafter represent the right to receive the Treasury
Securities forming a part of such Stripped Units, in each case in accordance
with the provisions of Section 4.3 of the Pledge Agreement. Upon the occurrence
of a Termination Event, the Company shall promptly but in no event later than
two Business Days thereafter give written notice to the Agent, the Collateral
Agent and to the Holders, at their addresses as they appear in the Register.
54
SECTION 5.9 EARLY SETTLEMENT.
(a) Subject to and upon compliance with the provisions of this Section
5.9, Purchase Contracts underlying Units having an aggregate Stated Amount
equal to $1,000 or an integral multiple thereof, may, at the option of the
Holder thereof, be settled early ("Early Settlement") on or prior to 10:00
a.m. on the seventh Business Day immediately preceding the Stock Purchase
Date. In order to exercise the right to effect Early Settlement with
respect to any Purchase Contracts, the Holder of the Certificate evidencing
the related Units shall deliver such Certificate to the Agent at the
Corporate Trust Office duly endorsed for transfer to the Company or in
blank with the form of Election to Settle Early on the reverse thereof duly
completed and accompanied by payment payable to the Company in immediately
available funds in an amount (the "Early Settlement Amount") equal to (A)
the product of (i) the Stated Amount of such Units multiplied by (ii) the
number of Purchase Contracts with respect to which the Holder has elected
to effect Early Settlement, plus (B) if such delivery is made with respect
to any Purchase Contracts during the period from close of business on any
Record Date next preceding any Payment Date to the opening of business on
such Payment Date, an amount equal to the Contract Adjustment Payments, if
any, payable on such Payment Date with respect to such Purchase Contracts;
provided that no payment shall be required pursuant to clause (B) of this
sentence if the Company shall have elected to defer the Contract Adjustment
Payments which would otherwise be payable on such Payment Date. Except as
provided in the immediately preceding sentence and subject to Section
5.2(d), no payment or adjustment shall be made upon Early Settlement of any
Purchase Contract on any Contract Adjustment Payments accrued on such
Purchase Contract or on account of any dividends on the Common Stock issued
upon such Early Settlement. If the foregoing requirements are first
satisfied with respect to Purchase Contracts underlying any Unit at or
prior to 5:00 p.m., New York City time, on a Business Day, such day shall
be the "Early Settlement Date" with respect to such Unit and if such
requirements are first satisfied after 5:00 p.m., New York City time, on a
Business Day or on a day that is not a Business Day, the "Early Settlement
Date" with respect to such Units shall be the next succeeding Business Day.
(b) Upon Early Settlement of any Purchase Contract by the Holder of
the related Units, the Company shall issue, and the Holder shall be
entitled to receive, 2.3719 shares of Common Stock on account of such
Purchase Contract (the "Early Settlement Rate"). The Early Settlement Rate
shall be adjusted in the same manner and at the same time as the Settlement
Rate is adjusted. As promptly as practicable after Early Settlement of
Purchase Contracts in accordance with the provisions of this Section 5.9,
the Company shall issue and shall deliver to the Agent at the Corporate
Trust Office a certificate or certificates for the full number of shares of
Common Stock issuable upon such Early Settlement together with payment in
lieu of any fraction of a share, as provided in Section 5.12.
55
(c) No later than the third Business Day after the applicable Early
Settlement Date the Company shall cause (i) the shares of Common Stock
issuable upon Early Settlement of Purchase Contracts to be issued and
delivered, and (ii) the related Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, in the case of Normal Units, or the related Pledged Treasury
Securities, in the case of Stripped Units, to be released from the Pledge
by the Collateral Agent and transferred, in each case, to the Agent for
delivery to the Holder thereof or the Holder's designee.
(d) Upon Early Settlement of any Purchase Contracts, and subject to
receipt of shares of Common Stock from the Company and the Pledged Notes,
Pledged Treasury Consideration, Pledged Applicable Ownership Interest in
the Treasury Portfolio, or Pledged Treasury Securities, as the case may be,
from the Collateral Agent, as applicable, the Agent shall, in accordance
with the instructions provided by the Holder thereof on the applicable form
of Election to Settle Early on the reverse of the Certificate evidencing
the related Units, (i) transfer to the Holder the Pledged Notes, Pledged
Treasury Consideration, Pledged Applicable Ownership Interest in the
Treasury Portfolio, or Pledged Treasury Securities, as the case may be,
forming a part of such Units, and (ii) deliver to the Holder a certificate
or certificates for the full number of shares of Common Stock issuable upon
such Early Settlement together with payment in lieu of any fraction of a
share, as provided in Section 5.12.
(e) In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Units evidenced by a
Certificate, upon such Early Settlement the Company shall execute and the
Agent shall authenticate, countersign and deliver to the Holder thereof, at
the expense of the Company, a Certificate evidencing the Units as to which
Early Settlement was not effected.
SECTION 5.10 EARLY SETTLEMENT UPON MERGER.
(a) In the event of a merger or consolidation of the Company of the
type described in clause (1) of Section 5.6(b) in which the Common Stock
outstanding immediately prior to such merger or consolidation is exchanged
for consideration consisting of at least 30% cash or cash equivalents (any
such event a "Cash Merger"), then the Company (or the successor to the
Company hereunder) shall be required to offer the Holder of each Unit the
right to settle the Purchase Contract underlying such Unit prior to the
Stock Purchase Date ("Merger Early Settlement") as provided herein. On or
before the fifth Business Day after the consummation of a Cash Merger, the
Company or, at the request and expense of the Company, the Agent, shall
give all Holders notice of the occurrence of the Cash Merger and of the
right of Merger Early Settlement arising as a result thereof. The Company
shall also deliver a copy of such notice to the Agent and the Collateral
Agent.
56
Each such notice shall contain:
(i) the date, which shall be not less than 20 nor more than 30
calendar days after the date of such notice, on which the Merger Early
Settlement will be effected (the "Merger Early Settlement Date");
(ii) the date, which shall be on or one Business Day prior to the
Merger Early Settlement Date, by which the Merger Early Settlement
right must be exercised;
(iii) the Settlement Rate in effect as a result of such Cash
Merger and the kind and amount of securities, cash and other property
receivable by the Holder upon settlement of each Purchase Contract
pursuant to Section 5.6(b);
(iv) a statement to the effect that all or a portion of the
Purchase Price payable by the Holder to settle the Purchase Contract
will be offset against the amount of cash so receivable upon exercise
of Merger Early Settlement, as applicable; and
(v) the instructions a Holder must follow to exercise the Merger
Early Settlement right.
(b) To exercise a Merger Early Settlement right, a Holder shall
deliver to the Agent at the Corporate Trust Office on or before 5:00 p.m.,
New York City time on the date specified in the notice the Certificate(s)
evidencing the Units with respect to which the Merger Early Settlement
right is being exercised duly endorsed for transfer to the Company or in
blank with the form of Election to Settle Early on the reverse thereof duly
completed and accompanied by payment payable to the Company in immediately
available funds in an amount equal to the Early Settlement Amount less the
amount of cash that otherwise would be deliverable by the Company or its
successor upon settlement of the Purchase Contract in lieu of Common Stock
pursuant to Section 5.6(b) and as described in the notice to Holders (the
"Merger Early Settlement Amount").
(c) On the Merger Early Settlement Date, the Company shall deliver or
cause to be delivered (i) the net cash, securities and other property to be
received by such exercising Holder, equal to the Settlement Rate as
adjusted pursuant to Section 5.6, in respect of the number of Purchase
Contracts for which such Merger Early Settlement right was exercised, and
(ii) the related Pledged Notes, Pledged Treasury Consideration or Pledged
Applicable Ownership Interest in the Treasury Portfolio, in the case of
Normal Units, or Pledged Treasury Securities, in the case of Stripped
Units, to be released from the Pledge by the Collateral Agent and
transferred, in each case, to the Agent for delivery to the Holder thereof
or its designee. In the event a Merger Early Settlement right shall be
exercised by a Holder in accordance with the terms hereof, all references
57
herein to Stock Purchase Date shall be deemed to refer to such Merger Early
Settlement Date.
(d) Upon Merger Early Settlement of any Purchase Contracts, and
subject to receipt of such net cash, securities or other property from the
Company and the Pledged Notes, Pledged Treasury Consideration, Pledged
Applicable Ownership Interest in the Treasury Portfolio or Pledged Treasury
Securities, as the case may be, from the Collateral Agent, as applicable,
the Agent shall, in accordance with the instructions provided by the Holder
thereof on the applicable form of Election to Settle Early on the reverse
of the Certificate evidencing the related Units, (i) transfer to the Holder
the Pledged Notes, Pledged Treasury Consideration, Pledged Applicable
Ownership Interest in the Treasury Portfolio, or Pledged Treasury
Securities, as the case may be, forming a part of such Units, and (ii)
deliver to the Holder such net cash, securities or other property issuable
upon such Merger Early Settlement together with payment in lieu of any
fraction of a share, as provided in Section 5.12.
(e) In the event that Merger Early Settlement is effected with respect
to Purchase Contracts underlying less than all the Units evidenced by a
Certificate, upon such Merger Early Settlement the Company (or the
successor to the Company hereunder) shall execute and the Agent shall
authenticate, countersign and deliver to the Holder thereof, at the expense
of the Company, a Certificate evidencing the Units as to which Merger Early
Settlement was not effected.
SECTION 5.11 CHARGES AND TAXES.
The Company will pay all stock transfer and similar taxes attributable
to the initial issuance and delivery of the shares of Common Stock pursuant to
the Purchase Contracts and in payment of any Deferred Contract Adjustment
Payments; provided, that the Company shall not be required to pay any such tax
or taxes which may be payable in respect of any exchange of or substitution for
a Certificate evidencing a Unit or any issuance of a share of Common Stock in a
name other than that of the registered Holder of a Certificate surrendered in
respect of the Units evidenced thereby, other than in the name of the Agent, as
custodian for such Holder, and the Company shall not be required to issue or
deliver such share certificates or Certificates unless and until the Person or
Persons requesting the transfer or issuance thereof shall have paid to the
Company the amount of such tax or shall have established to the satisfaction of
the Company that such tax has been paid.
SECTION 5.12 NO FRACTIONAL SHARES.
No fractional shares or scrip representing fractional shares of Common
Stock shall be issued or delivered upon settlement on the Stock Purchase Date or
upon Early Settlement or Merger Early Settlement of any Purchase Contracts. If
Certificates evidencing more than one Purchase Contract shall be surrendered for
settlement at one
58
time by the same Holder, the number of full shares of Common Stock which shall
be delivered upon settlement shall be computed on the basis of the aggregate
number of Purchase Contracts evidenced by the Certificates so surrendered.
Instead of any fractional share of Common Stock which would otherwise be
deliverable upon settlement of any Purchase Contracts on the applicable
Settlement Date or upon Early Settlement or Merger Early Settlement, the
Company, through the Agent, shall make a cash payment in respect of such
fractional shares in an amount equal to the value of such fractional shares
times the Applicable Market Value. The Company shall provide the Agent from time
to time with sufficient funds to permit the Agent to make all cash payments
required by this Section 5.12 in a timely manner.
ARTICLE VI
REMEDIES
SECTION 6.1 UNCONDITIONAL RIGHT OF HOLDERS TO PURCHASE COMMON STOCK.
The Holder of any Unit shall have the right, which is absolute and
unconditional,
(a) subject to the right of the Company to defer payment thereof
pursuant to Section 5.3, and to the forfeiture of any Deferred Contract
Adjustment Payments upon Early Settlement pursuant to Section 5.9(c) or
upon Merger Early Settlement pursuant to Section 5.10(c) or upon the
occurrence of a Termination Event, to receive payment of each installment
of the Contract Adjustment Payments, if any, with respect to the Purchase
Contract constituting a part of such Unit on the respective Payment Date
for such Unit, and
(b) to purchase Common Stock pursuant to the Purchase Contract
constituting a part of such Unit and to institute suit for the enforcement
of any such right to purchase Common Stock, and such rights shall not be
impaired without the consent of such Holder.
SECTION 6.2 RESTORATION OF RIGHTS AND REMEDIES.
If any Holder has instituted any proceeding to enforce any right or
remedy under this Agreement and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company and such Holder shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies of such Holder
shall continue as though no such proceeding had been instituted.
59
SECTION 6.3 RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Certificates in Section 3.10(f),
no right or remedy herein conferred upon or reserved to the Holders is intended
to be exclusive of any other right or remedy, and every right and remedy shall,
to the extent permitted by law, be cumulative and in addition to every other
right and remedy given hereunder or now or hereafter existing at law or in
equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
SECTION 6.4 DELAY OR OMISSION NOT WAIVER.
No delay or omission of any Holder to exercise any right or remedy
upon a default shall impair any such right or remedy or constitute a waiver of
any such right. Every right and remedy given by this Article or by law to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by such Holders.
SECTION 6.5 UNDERTAKING FOR COSTS.
All parties to this Agreement agree, and each Holder of a Unit, by its
acceptance of such Unit shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Agreement, or in any suit against the Agent for any action taken,
suffered or omitted by it as Agent, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; provided that
the provisions of this Section shall not apply to any suit instituted by the
Company, to any suit instituted by the Agent, to any suit instituted by any
Holder, or group of Holders, holding in the aggregate more than 10% of the
Outstanding Units, or to any suit instituted by any Holder for the enforcement
of distributions on any Notes on any Purchase Contract on or after the
respective Payment Date therefor in respect of any Unit held by such Holder, or
for enforcement of the right to purchase shares of Common Stock under the
Purchase Contract constituting part of any Unit held by such Holder.
SECTION 6.6 WAIVER OF STAY OR EXTENSION LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Agreement; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, but will suffer and permit the execution of every such power as though no
such law had been enacted.
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ARTICLE VII
THE AGENT
SECTION 7.1 CERTAIN DUTIES, RIGHTS AND IMMUNITIES.
(a) The Agent shall act as agent for the Holders of the Units
hereunder with such powers as are specifically vested in the Agent by the
terms of this Agreement, the Pledge Agreement, the Remarketing Agreement,
the Notes and the Units, and any documents evidencing thereof or related
thereto (the "Transaction Documents"), together with such other powers as
are reasonably incidental thereto. The Agent:
(1) shall have no duties or responsibilities except those
expressly set forth in the Transaction Documents and no implied
covenants or obligations shall be inferred from any Transaction
Documents against the Agent, nor shall the Agent be bound by the
provisions of any agreement by any party hereto beyond the specific
terms hereof;
(2) shall be entitled conclusively to rely upon (x) any
certification, order, judgment, opinion, notice or other communication
(including, without limitation, any thereof by telephone or facsimile)
reasonably believed by it to be genuine and correct 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), (y) the truth of the statements and the correctness
of the opinions expressed therein and (z) advice and statements of
legal counsel and other experts selected by the Agent;
(3) as to any matters not expressly provided for by any
Transaction Document, shall in all cases be fully protected in acting,
or in refraining from acting, hereunder or thereunder in accordance
with instructions given by the Company or the Holders in accordance
with the Transaction Documents;
(4) shall not be responsible for any recitals contained in any
Transaction Document, or in any certificate or other document referred
to or provided for in, or received by it under, any Transaction
Document or the Units, or for the value, validity, effectiveness,
genuineness, enforceability or sufficiency of any Transaction Document
(other than as against the Agent) or the Units or any other document
referred to or provided for herein or therein or for any failure by
the Company, any Holder or any other Person (except the Agent) to
perform any of its obligations hereunder or thereunder or for the
perfection, priority or, except as expressly required hereby,
existence, validity, perfection or
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maintenance of any security interest created under the Pledge
Agreement, or for the use or application by the Company of the
proceeds in respect of the Purchase Contracts;
(5) shall not be required to initiate or conduct any litigation
or collection proceedings hereunder;
(6) shall not be responsible for any action taken 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, bad faith or willful
misconduct; and
(7) shall not be required to advise any party as to selling or
retaining, or taking or refraining from taking any action with respect
to, the Units or other rights under any Transaction Document.
(b) No provision of any Transaction Document shall be construed to
relieve the Agent from liability for its own grossly negligent action, its
own grossly negligent failure to act, its own bad faith, or its own willful
misconduct, except that:
(1) this paragraph (b) shall not be construed to limit the effect
of paragraph (a) of this Section;
(2) the Agent shall not be liable for any error of judgment made
in good faith by a Responsible Officer, unless it shall be proved that
the Agent was grossly negligent in ascertaining the pertinent facts;
and
(3) in no event shall the Agent be required to expend or risk its
own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder.
(c) In no event shall the Agent or its officers, employees or agents
be liable for any special, indirect, individual, punitive or consequential
damages, lost profits or loss of business, arising in connection with any
Transaction Document, whether or not the likelihood of such loss or damage
was known to the Agent, incurred without any act or deed that is found to
be attributable to gross negligence, bad faith or willful misconduct on the
part of the Agent.
(d) Whether or not therein expressly so provided, every provision of
every Transaction Document relating to the conduct or affecting the
liability of or affording protection to the Agent shall be subject to the
provisions of this Section.
(e) The Agent is authorized to execute and deliver the Pledge
Agreement and the Remarketing Agreement and any supplement thereto in its
capacity as Agent.
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(f) The Agent shall have no liability whatsoever for the action or
inaction of any Clearing Agency or any book-entry system thereof. In no
event shall any Clearing Agency or any book-entry system thereof be deemed
an agent or subcustodian of the Agent.
(g) The Agent shall not be responsible or liable for any failure or
delay in the performance of its obligations under any Transaction Document
arising out of or caused, directly or indirectly, by circumstances beyond
its reasonable control, including, without limitation, acts of God;
earthquakes; fires; floods; wars; civil or military disturbances; sabotage;
epidemics; riots; interruptions, loss or malfunctions of utilities,
computer (hardware or software) or communications service; accidents; labor
disputes; acts of civil or military authority; governmental actions; or
inability to obtain labor, material, equipment or transportation.
SECTION 7.2 NOTICE OF DEFAULT.
Within 30 days after the occurrence of any default by the Company
hereunder of which a Responsible Officer of the Agent has actual knowledge, the
Agent shall transmit by mail to the Company and the Holders of Units, as their
names and addresses appear in the Register, notice of such default hereunder,
unless such default shall have been cured or waived.
SECTION 7.3 CERTAIN RIGHTS OF AGENT.
Subject to the provisions of Section 7.1:
(a) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officer's Certificate, Issuer Order or Issuer
Request, and any resolution of the Board of Directors of the Company may be
sufficiently evidenced by a Board Resolution;
(b) whenever in the administration of this Agreement the Agent shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Agent (unless other
evidence be herein specifically prescribed) may, in the absence of bad
faith on its part, rely upon an Officer's Certificate of the Company;
(c) the Agent may consult with counsel and the written 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;
(d) the Agent shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Agent, in its
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discretion, may make reasonable further inquiry or investigation into such
facts or matters related to the execution, delivery and performance of the
Purchase Contracts as it may see fit, and, if the Agent shall determine to
make such further inquiry or investigation, it shall be given a reasonable
opportunity to examine the books, records and premises of the Company,
personally or by agent or attorney; and
(e) the Agent may execute any of the powers hereunder or perform any
duties hereunder either directly or by or through agents or attorneys or an
Affiliate of the Agent and the Agent shall not be responsible for any
misconduct or negligence on the part of any agent or attorney or an
Affiliate appointed with due care by it hereunder.
SECTION 7.4 NOT RESPONSIBLE FOR RECITALS, ETC.
The recitals contained herein and in the Certificates shall be taken
as the statements of the Company.
SECTION 7.5 MAY HOLD UNITS AND OTHER DEALINGS.
Any Registrar or any other agent of the Company, or the Agent and its
Affiliates, in their individual or any other capacity, may become the owner or
pledgee of Units and may otherwise deal with the Company, the Collateral Agent
or any other Person with the same rights it would have if it were not Registrar
or such other agent, or the Agent. The Agent and its Affiliates may (without
having to account therefor to the Company or any Holder of Units or holder of
Separate Notes) accept deposits from, lend money to, make their investments in
and generally engage in any kind of banking, trust or other business with the
Company, any Holder of Units and any holder of Separate Notes (and any of their
respective subsidiaries or Affiliates) as if it were not acting as the Agent and
the Agent and their Affiliates may accept fees and other consideration from the
Company, any Holder of Units or any holder of Separate Notes without having to
account for the same to any such Person.
SECTION 7.6 MONEY HELD IN CUSTODY.
Money held by the Agent in custody hereunder need not be segregated
from the Agent's other funds except to the extent required by law or provided
herein. The Agent shall be under no obligation to invest or pay interest on any
money received by it hereunder except as otherwise agreed in writing with the
Company.
SECTION 7.7 COMPENSATION AND REIMBURSEMENT.
The Company agrees:
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(a) to pay to the Agent from time to time compensation for all
services rendered by it hereunder as shall be agreed in writing between the
Company and the Agent;
(b) to reimburse the Agent upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Agent in
accordance with any provision of this Agreement (including the reasonable
compensation and the reasonable expenses and disbursements of its agents
and counsel), except any such expense, disbursement or advance as may be
attributable to its gross negligence, willful misconduct or bad faith; and
(c) to indemnify the Agent and any predecessor Agent for, and to hold
it harmless against, any loss, liability or reasonable out-of-pocket
expense incurred without gross negligence, willful misconduct or bad faith
on its part, arising out of or in connection with the acceptance or
administration of its duties under the Transaction Documents, including the
costs and expenses (including reasonable fees and expenses of counsel) of
defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties under the
Transaction Documents. The Agent shall each promptly notify the Company of
any third party claim which may give rise to the indemnity hereunder and
give the Company the opportunity to participate in the defense of such
claim with counsel reasonably satisfactory to the indemnified party, and no
such claim shall be settled without the written consent of the Company,
which consent shall not be unreasonably withheld.
The provisions of this Section 7.7 shall survive the termination of this
Agreement.
SECTION 7.8 CORPORATE AGENT REQUIRED; ELIGIBILITY.
There shall at all times be an Agent hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having (or being a member of a bank
holding company having) a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by federal or state authority and having a
Corporate Trust Office in the Borough of Manhattan, The City of New York, if
there be such a corporation, qualified and eligible under this Article and
willing to act on reasonable terms. If such corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of said
supervising or examining authority, then for the purposes of this Section, the
combined capital and surplus of such corporation shall be deemed to be its
combined capital and surplus as set forth in its most recent report of condition
so published. If at any time the Agent shall cease to be eligible in accordance
with the provisions of this Section, it shall resign immediately in the manner
and with the effect hereinafter specified in this Article.
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SECTION 7.9 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of the Agent and no appointment of a
successor Agent pursuant to this Article shall become effective until the
acceptance of appointment by the successor Agent in accordance with the
applicable requirements of Section 7.10.
(b) The Agent may resign at any time by giving written notice thereof
to the Company 60 days prior to the effective date of such resignation. If
the instrument of acceptance by a successor Agent required by Section 7.10
shall not have been delivered to the Agent within 30 days after the giving
of such notice of resignation, the resigning Agent may petition any court
of competent jurisdiction for the appointment of a successor Agent.
(c) The Agent may be removed at any time by Act of the Holders of a
majority in number of the Outstanding Units delivered to the Agent and the
Company.
(d) If at any time:
(1) the Agent fails to comply with Section 310(b) of the TIA, as
if the Agent were an Trustee under an indenture qualified under the
TIA, after written request therefor by the Company or by any Holder
who has been a bona fide Holder of a Unit for at least six months; or
(2) the Agent shall cease to be eligible under Section 7.8 and
shall fail to resign after written request therefor by the Company or
by any such Holder; or
(3) the Agent shall become incapable of acting or shall be
adjudged bankrupt or insolvent or a receiver of the Agent or of its
property shall be appointed or any public officer shall take charge or
control of the Agent or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation;
then, in any such case, (x) the Company by a Board Resolution may remove
the Agent, or (y) any Holder who has been a bona fide Holder of a Unit for
at least six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the removal of
the Agent and the appointment of a successor Agent.
(e) If the Agent shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Agent for any cause,
the Company, by a Board Resolution, shall promptly appoint a successor
Agent and shall comply with the applicable requirements of Section 7.10. If
no successor
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Agent shall have been so appointed by the Company and accepted appointment
in the manner required by Section 7.10, any Holder who has been a bona fide
Holder of a Unit for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Agent.
(f) The Company shall give, or shall cause such successor Agent to
give, notice of each resignation and each removal of the Agent and each
appointment of a successor Agent by mailing written notice of such event by
first-class mail, postage prepaid, to all Holders as their names and
addresses appear in the applicable Register. Each notice shall include the
name of the successor Agent and the address of its Corporate Trust Office.
SECTION 7.10 ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor Agent, every
such successor Agent so appointed shall execute, acknowledge and deliver to
the Company and to the retiring Agent an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Agent
shall become effective and such successor Agent, without any further act,
deed or conveyance, shall become vested with all the rights, powers,
agencies and duties of the retiring Agent; but, on the request of the
Company or the successor Agent, such retiring Agent shall, upon payment of
its charges, execute and deliver an instrument transferring to such
successor Agent all the rights, powers and trusts of the retiring Agent and
shall duly assign, transfer and deliver to such successor Agent all
property and money held by such retiring Agent hereunder.
(b) Upon request of any such successor Agent, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Agent all such rights, powers and agencies
referred to in paragraph (a) of this Section.
(c) No successor Agent shall accept its appointment unless at the time
of such acceptance such successor Agent shall be qualified and eligible
under this Article.
SECTION 7.11 MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO
BUSINESS.
Any corporation into which the Agent may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Agent shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Agent, shall be the successor of the Agent hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Certificates shall have been
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authenticated and executed on behalf of the Holders, but not delivered, by the
Agent then in office, any successor by merger, conversion or consolidation to
such Agent shall adopt such authentication and execution and deliver the
Certificates so authenticated and executed with the same effect as if such
successor Agent had itself authenticated and executed such Units.
SECTION 7.12 PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.
(a) The Agent shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders received by the Agent in
its capacity as Registrar.
(b) If three or more Holders (herein referred to as "Applicants")
apply in writing to the Agent, and furnish to the Agent reasonable proof
that each such applicant has owned a Unit for a period of at least six
months preceding the date of such application, and such application states
that the applicants desire to communicate with other Holders with respect
to their rights under this Agreement or under the Units and is accompanied
by a copy of the form of proxy or other communication which such applicants
propose to transmit, then the Agent shall mail to all the Holders copies of
the form of proxy or other communication which is specified in such
request, with reasonable promptness after a tender to the Agent of the
materials to be mailed and of payment, or provision, in the absence of bad
faith, satisfactory to the Agent for the payment, of the reasonable
expenses of such mailing.
SECTION 7.13 FAILURE TO ACT
In the event of any ambiguity in the provisions of any Transaction
Document or any dispute between or conflicting claims by or among the parties
hereto or any other Person, the Agent shall be entitled, after prompt notice to
the Company and the Holders of Units, at its sole option, to refuse to comply
with any and all such claims, demands or instructions so long as such dispute or
conflict shall continue, and the 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 Agent shall be entitled to
refuse to act until either (i) 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,
reasonably satisfactory to the Agent, or (ii) the Agent shall have received
security or an indemnity reasonably satisfactory to the Agent sufficient to save
the Agent harmless from and against any and all loss, liability or reasonable
out-of-pocket expense which the Agent may incur by reason of its acting without
bad faith, willful misconduct or gross negligence. The Agent may in addition
elect to commence an interpleader action or seek other judicial relief or orders
as the Agent may deem necessary. Notwithstanding anything contained herein to
the contrary, the Agent shall not be required to take any
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action that is in its opinion contrary to law or to the terms of any Transaction
Document, or which would in its opinion subject it or any of its officers,
employees or directors to liability.
SECTION 7.14 NO OBLIGATIONS OF AGENT.
Except to the extent otherwise provided in this Agreement, the Agent
assumes no obligation and shall not be subject to any liability under this
Agreement, the Pledge Agreement or any Purchase Contract in respect of the
obligations of the Holder of any Unit thereunder. The Company agrees, and each
Holder of a Certificate, by such Holder's acceptance thereof, shall be deemed to
have agreed, that the Agent's execution of the Certificates on behalf of the
Holders shall be solely as agent and attorney-in-fact for the Holders, and that
the Agent shall have no obligation to perform such Purchase Contracts on behalf
of the Holders, except to the extent expressly provided in Article V.
SECTION 7.15 TAX COMPLIANCE.
(a) The Agent, on its own behalf and on behalf of the Company, will
comply with all applicable certification, information reporting and
withholding (including "backup" withholding) requirements imposed by
applicable tax laws, regulations or administrative practice with respect to
(i) any payments made with respect to the Units or (ii) the issuance,
delivery, holding, transfer, redemption or exercise of rights under the
Units. Such compliance shall include, without limitation, the preparation
and timely filing of required returns and the timely payment of all amounts
required to be withheld to the appropriate taxing authority or its
designated agent.
(b) The Agent shall comply with any reasonable written direction
timely received from the Company with respect to the application of such
requirements to particular payments or Holders or in other particular
circumstances, and may for purposes of this Agreement rely on any such
direction in accordance with the provisions of Section 7.1(a)(2).
(c) The Agent shall maintain all appropriate records documenting
compliance with such requirements, and shall make such records available,
on written request, to the Company or its authorized representative within
a reasonable period of time after receipt of such request.
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ARTICLE VIII
SUPPLEMENTAL AGREEMENTS
SECTION 8.1 SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company and the Agent, at any time
and from time to time, may enter into one or more agreements supplemental
hereto, in form satisfactory to the Company and the Agent, for any of the
following purposes:
(a) to evidence the succession of another Person to the Company, and
the assumption by any such successor of the covenants of the Company herein
and in the Certificates; or
(b) to add to the covenants of the Company for the benefit of the
Holders, or to surrender any right or power herein conferred upon the
Company; or
(c) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(d) to make provision with respect to the rights of Holders pursuant
to the requirements of Section 5.6(b) or 5.10; or
(e) to cure any ambiguity, to correct or supplement any provisions
herein which may be inconsistent with any other provisions herein, or to
make any other provisions with respect to such matters or questions arising
under this Agreement, provided such action shall not adversely affect the
interests of the Holders.
SECTION 8.2 SUPPLEMENTAL AGREEMENTS WITH CONSENT OF HOLDERS.
(a) With the consent of the Holders of not less than a majority of the
outstanding Purchase Contracts voting together as one class, by Act of said
Holders delivered to the Company and the Agent, the Company, when
authorized by a Board Resolution, and the Agent may enter into an agreement
or agreements supplemental hereto for the purpose of modifying in any
manner the terms of the Purchase Contracts, or the provisions of this
Agreement or the rights of the Holders in respect of the Units; provided,
that, except as contemplated herein, no such supplemental agreement shall,
without the consent of the Holder of each Outstanding Unit affected
thereby:
(1) change any Payment Date;
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(2) change the amount or the type of Collateral required to be
Pledged to secure a Holder's obligations under the Purchase Contract,
impair the right of the Holder of any Purchase Contract to receive
distributions on the related Collateral (except for the rights of
Holders of Normal Units to substitute the Treasury Securities for the
Pledged Notes, Pledged Treasury Consideration or Pledged Applicable
Ownership Interest in the Treasury Portfolio, or the rights of holders
of Stripped Units to substitute Notes or appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury
Portfolio for the Pledged Treasury Securities) or otherwise adversely
affect the Holder's rights in or to such Collateral or materially
adversely alter the rights in or to such Collateral;
(3) reduce any Contract Adjustment Payments, if any, or any
Deferred Contract Adjustment Payment, or change any place where, or
the coin or currency in which, any Contract Adjustment Payment is
payable;
(4) impair the right to institute suit for the enforcement of any
Purchase Contract, any Contract Adjustment Payment, if any, or any
Deferred Contract Adjustment Payment, if any;
(5) reduce the number of shares of Common Stock to be purchased
pursuant to any Purchase Contract, increase the price to purchase
shares of Common Stock upon settlement of any Purchase Contract,
change the Stock Purchase Date or otherwise materially adversely
affect the Holder's rights under any Purchase Contract; or
(6) reduce the percentage of the outstanding Purchase Contracts
the consent of whose Holders is required for any such supplemental
agreement;
provided, that if any amendment or proposal referred to above would
adversely affect only the Normal Units or the Stripped Units, then only the
affected class of Holder as of the record date for the Holders entitled to
vote thereon will be entitled to vote on 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.
(b) It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental
agreement, but it shall be sufficient if such Act shall approve the
substance thereof.
SECTION 8.3 EXECUTION OF SUPPLEMENTAL AGREEMENTS.
In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Agent shall be provided and (subject
to Section
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7.1) shall be fully protected in relying upon, an Opinion of Counsel
stating that the execution of such supplemental agreement is authorized or
permitted by this Agreement. The Agent may, but shall not be obligated to, enter
into any such supplemental agreement which affects the Agent's own rights,
duties or immunities under this Agreement or otherwise.
SECTION 8.4 EFFECT OF SUPPLEMENTAL AGREEMENTS.
Upon the execution of any supplemental agreement under this Article,
this Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of this Agreement for all purposes; and every Holder
of Certificates theretofore or thereafter authenticated, executed on behalf of
the Holders and delivered hereunder shall be bound thereby.
SECTION 8.5 REFERENCE TO SUPPLEMENTAL AGREEMENTS.
Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Agent, bear a notation in form
approved by the Agent as to any matter provided for in such supplemental
agreement. If the Company shall so determine, new Certificates so modified as to
conform, in the opinion of the Agent and the Company, to any such supplemental
agreement may be prepared and executed by the Company and authenticated,
executed on behalf of the Holders and delivered by the Agent in exchange for
Outstanding Certificates.
ARTICLE IX
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.1 COVENANT NOT TO MERGE, CONSOLIDATE, SELL OR CONVEY
PROPERTY EXCEPT UNDER CERTAIN CONDITIONS.
The Company covenants that it will not (a) merge with or into or
consolidate with any other Person or (b) sell, assign, transfer, lease or convey
all or substantially all of its properties and assets to any Person or group of
affiliated Persons in one transaction or a series of related transactions other
than, with respect to clause (b), a direct or indirect wholly-owned subsidiary
of the Company, unless (i) either the Company shall be the continuing
corporation, or the successor (if other than the Company) shall be a corporation
organized and existing under the laws of the United States of America or a State
thereof or the District of Columbia and such corporation shall expressly assume
all the obligations of the Company under the Purchase Contracts, the Notes, this
Agreement, the Remarketing Agreement and the Pledge Agreement by one or more
supplemental agreements in form reasonably satisfactory to the Agent and the
Collateral Agent, executed and delivered to the Agent and the Collateral Agent
by such corporation, and (ii) the Company or such successor corporation, as the
case may be, shall not, immediately after such merger or consolidation, or such
sale, assignment,
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transfer, lease or conveyance, be in default in the performance of any covenant
or condition hereunder, under any of the Purchase Contracts, under the
Remarketing Agreement, or under the Pledge Agreement.
SECTION 9.2 RIGHTS AND DUTIES OF SUCCESSOR CORPORATION.
(a) In case of any such consolidation, merger, sale, assignment,
transfer, lease or conveyance and upon any such assumption by a successor
corporation in accordance with Section 9.1, such successor corporation
shall succeed to and be substituted for the Company with the same effect as
if it had been named herein as the Company. Such successor corporation
thereupon may cause to be signed, and may issue either in its own name or
in the name of the Company, any or all of the Certificates evidencing Units
issuable hereunder which theretofore shall not have been signed by the
Company and delivered to the Agent; and, upon the order of such successor
corporation, instead of the Company, and subject to all the terms,
conditions and limitations in this Agreement prescribed, the Agent shall
authenticate and execute on behalf of the Holders and deliver any
Certificates which previously shall have been signed and delivered by the
officers of the Company to the Agent for authentication and execution, and
any Certificate evidencing Units which such successor corporation
thereafter shall cause to be signed and delivered to the Agent for that
purpose. All the Certificates so issued shall in all respects have the same
legal rank and benefit under this Agreement as the Certificates theretofore
or thereafter issued in accordance with the terms of this Agreement as
though all of such Certificates had been issued at the date of the
execution hereof.
(b) In case of any such consolidation, merger, sale, assignment,
transfer, lease or conveyance such change in phraseology and form (but not
in substance) may be made in the Certificates evidencing Units thereafter
to be issued as may be appropriate.
SECTION 9.3 OPINION OF COUNSEL GIVEN TO AGENT.
The Agent, subject to Sections 7.1 and 7.3, shall receive an Opinion
of Counsel as conclusive evidence that any such consolidation, merger, sale,
assignment, transfer, lease or conveyance, and any such assumption, complies
with the provisions of this Article and that all conditions precedent to the
consummation of any such consolidation, merger, sale, assignment, transfer,
lease or conveyance have been met.
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ARTICLE X
COVENANTS
SECTION 10.1 PERFORMANCE UNDER PURCHASE CONTRACTS.
The Company covenants and agrees for the benefit of the Holders from
time to time of the Units that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.
SECTION 10.2 MAINTENANCE OF OFFICE OR AGENCY.
(a) The Company will maintain in the Borough of Manhattan, The City of
New York an office or agency where Certificates may be presented or
surrendered for acquisition of shares of Common Stock upon settlement of
the Purchase Contracts on any Settlement Date and for transfer of
Collateral upon occurrence of a Termination Event, where Certificates may
be surrendered for registration of transfer or exchange, for a Collateral
Substitution or reestablishment of Normal Units and where notices and
demands to or upon the Company in respect of the Units and this Agreement
may be served. The Company will give prompt written notice to the Agent of
the location, and any change in the location, of such office or agency. If
at any time the Company shall fail to maintain any such required office or
agency or shall fail to furnish the Agent with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office, and the Company hereby appoints the Agent as its
agent to receive all such presentations, surrenders, notices and demands.
(b) The Company may also from time to time designate one or more other
offices or agencies where Certificates may be presented or surrendered for
any or all such purposes and may from time to time rescind such
designations; provided, that no such designation or rescission shall in any
manner relieve the Company of its obligation to maintain an office or
agency in the Borough of Manhattan, The City of New York for such purposes.
The Company will give prompt written notice to the Agent of any such
designation or rescission and of any change in the location of any such
other office or agency. The Company hereby designates as the place of
payment for the Units the Corporate Trust Office and appoints the Agent at
its Corporate Trust Office as paying agent.
SECTION 10.3 COMPANY TO RESERVE COMMON STOCK.
The Company shall at all times prior to the Stock Purchase Date
reserve and keep available, free from preemptive rights, out of its authorized
but unissued Common Stock the full number of shares of Common Stock issuable
against tender of
74
payment in respect of all Purchase Contracts constituting a part of the Units
evidenced by Outstanding Certificates.
SECTION 10.4 COVENANTS AS TO COMMON STOCK.
The Company covenants that all shares of Common Stock which may be
issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Units will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.
SECTION 10.5 STATEMENTS OF OFFICER OF THE COMPANY AS TO DEFAULT.
The Company will deliver to the Agent, within 120 days after the end
of each fiscal year of the Company ending after the date hereof, an Officer's
Certificate, stating whether or not to the best knowledge of the signer thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions hereof, and if the Company shall be in default,
specifying all such defaults and the nature and status thereof of which such
Officer may have knowledge.
75
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
MOTOROLA, INC.
By: /s/ XXXXX X. XXXXX
-------------------------------
Name: Xxxxx X. Xxxxx
Title: Senior Vice President and
Treasurer
FIRST UNION TRUST COMPANY,
NATIONAL ASSOCIATION,
as Purchase Contract Agent
By: /s/ XXXXXX X. XXXXXX, XX.
-------------------------------
Name: Xxxxxx X. Xxxxxx, Xx.
Title: Vice President
EXHIBIT A
FORM OF NORMAL UNITS CERTIFICATE
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE
NAME OF THE CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE
EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER OF
THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company (55 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) to the
Company or its agent for registration of transfer, exchange or payment, and any
Certificate issued is registered in the name of Cede & Co., or such other name
as requested by an authorized representative of The Depository Trust Company,
and any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.
(Form of Face of Normal Units Certificate)
No. CUSIP No.
------------------------------------- ----------------------
Number of Normal Units
------------------
This Normal Units Certificate certifies that Cede & Co. is the
registered Holder of the number of Normal Units set forth above. Each Normal
Unit represents (i) either (a) beneficial ownership by the Holder of one 6.50%
Senior Note (the "Note") of Motorola, Inc., a Delaware corporation (the
"Company"), having a principal amount of $50, subject to the Pledge of such Note
by such Holder pursuant to the Pledge Agreement, (b) if the Note has been
remarketed by the Remarketing Agent (or if the Holder has elected not to have
the Note remarketed by delivering the appropriate Treasury Consideration
specified by the Remarketing Agent), the appropriate Treasury Consideration,
subject to the Pledge of such Treasury Consideration by such Holder pursuant to
the Pledge Agreement, or (c) if a Tax Event Redemption has occurred, the
appropriate Applicable Ownership Interest in the Treasury Portfolio subject to
the Pledge of such Applicable Ownership Interest in the Treasury Portfolio
pursuant to the Pledge Agreement, and (ii) the rights and obligations of the
Holder under one Purchase Contract with the Company. All capitalized terms used
herein which are defined in the Purchase Contract Agreement have the meaning set
forth therein.
Pursuant to the Pledge Agreement, the Note or the appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury Portfolio, as the
case
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may be, constituting part of each Normal Unit evidenced hereby has been pledged
to the Collateral Agent, for the benefit of the Company, to secure the
obligations of the Holder under the Purchase Contract comprising a part of such
Normal Unit.
The Pledge Agreement provides that all payments in respect of the
Pledged Notes, Pledged Treasury Consideration or Pledged Applicable Ownership
Interest in the Treasury Portfolio received by the Collateral Agent shall be
paid by the Collateral Agent by wire transfer in same day funds (i) in the case
of (A) quarterly cash distributions on Normal Units which include Pledged Notes,
Pledged Treasury Consideration or Pledged Applicable Ownership Interest in the
Treasury Portfolio and (B) any payments in respect of the Notes, Treasury
Consideration or Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, that have been released from the Pledge pursuant to the Pledge
Agreement, to the Agent to the account designated by the Agent, no later than
10:00 a.m., New York City time, on the Business Day such payment is received by
the Collateral Agent (provided that in the event such payment is received by the
Collateral Agent on a day that is not a Business Day or after 9:00 a.m., New
York City time, on a Business Day, then such payment shall be made no later than
9:30 a.m., New York City time, on the next succeeding Business Day) and (ii) in
the case of payments in respect of any Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, to be paid upon settlement of such Holder's
obligations to purchase Common Stock under the Purchase Contract, to the Company
on the Stock Purchase Date (as defined herein) in accordance with the terms of
the Pledge Agreement, in full satisfaction of the respective obligations of the
Holders of the Normal Units of which such Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, are a part under the Purchase Contracts forming a
part of such Normal Units. Quarterly distributions on Normal Units which include
Pledged Notes, Pledged Treasury Consideration or Pledged Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, which are payable
quarterly in arrears on February 16, May 16, August 16, and November 16 each
year, commencing February 16, 2002 (a "Payment Date"), shall, subject to receipt
thereof by the Agent from the Collateral Agent, be paid to the Person in whose
name this Normal Units Certificate (or a Predecessor Normal Units Certificate)
is registered at the close of business on the Record Date for such Payment Date.
Each Purchase Contract evidenced hereby obligates the Holder of this
Normal Units Certificate to purchase, and the Company to sell, on November 16,
2004 (the "Stock Purchase Date"), at a price equal to $50 (the "Stated Amount"),
a number of newly issued shares of Common Stock, $3 par value per share ("Common
Stock"), of the Company, equal to the Settlement Rate, unless on or prior to the
Stock Purchase Date there shall have occurred a Termination Event or a Cash
Settlement, Early Settlement or Merger Early Settlement with respect to the
Normal Units of which such Purchase Contract is a part, all as provided in the
Purchase Contract Agreement and more fully described on the reverse hereof. The
Purchase Price (as defined herein) for the shares of Common Stock purchased
pursuant to each Purchase Contract evidenced hereby, if not
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paid earlier, shall be paid on the Stock Purchase Date by application of
payments received in respect of the Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, pledged to secure the obligations of the Holder
under such Purchase Contract.
Payments on the Notes or the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as the case may be,
will be payable at the office of the Agent in The City of Wilmington, Delaware
or, at the option of the Company, by check mailed to the address of the Person
entitled thereto as such address appears on the Normal Units Register or by wire
transfer to an account specified by the Company.
The Company shall pay on each Payment Date in respect of each Purchase
Contract forming part of a Normal Unit evidenced hereby an amount (the "Contract
Adjustment Payment") equal to 0.50% per year of the Stated Amount, computed on
the basis of a 360-day year of twelve 30-day months, subject to deferral at the
option of the Company as provided in the Purchase Contract Agreement and more
fully described on the reverse hereof (provided that if any date on which a
Contract Adjustment Payment is to be made on the Purchase Contracts is not a
Business Day, then payment of such Contract Adjustment Payment payable on such
date will be made on the next succeeding day which is a Business Day, and no
interest or payment will be paid in respect of such delay, except that if such
next succeeding Business Day is in the next succeeding calendar year, then such
payment will be made on the immediately preceding Business Day). Such Contract
Adjustment Payments shall be payable to the Person in whose name this Normal
Units Certificate (or a Predecessor Normal Units Certificate) is registered at
the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments will be payable at the office of the
Agent in The City of Wilmington, Delaware or, at the option of the Company, by
check mailed to the address of the Person entitled thereto as such address
appears on the Normal Units Register.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Normal Units Certificate shall not be
entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.
A-3
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
MOTOROLA, INC.
By:
----------------------------------
Name:
Title:
By:
----------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the Purchase
Contracts evidenced hereby)
By: FIRST UNION TRUST COMPANY, NATIONAL
ASSOCIATION, not individually but
solely as Attorney-in-Fact of such
Holder
By:
----------------------------------
Name:
Title:
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AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Normal Units Certificates referred to in the within
mentioned Purchase Contract Agreement.
FIRST UNION TRUST COMPANY,
NATIONAL ASSOCIATION,
as Purchase Contract Agent
Dated: By:
----------------------------- -----------------------------
Authorized Officer
A-5
(Reverse of Normal Units Certificate)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of October 31, 2001 (as may be supplemented from
time to time, the "Purchase Contract Agreement"), between the Company and First
Union Trust Company, National Association, as Purchase Contract Agent (including
its successors thereunder, herein called the "Agent"), to which Purchase
Contract Agreement and supplemental agreements thereto reference is hereby made
for a description of the respective rights, limitations of rights, obligations,
duties and immunities thereunder of the Agent, the Company, and the Holders and
of the terms upon which the Normal Units Certificates are, and are to be,
executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Normal Units Certificate to purchase, and the Company to sell, on the Stock
Purchase Date at a price equal to $50 (the "Purchase Price"), a number of shares
of Common Stock of the Company equal to the Settlement Rate, unless, on or prior
to the Stock Purchase Date, there shall have occurred a Termination Event or an
Early Settlement, Merger Early Settlement or Cash Settlement with respect to the
Unit of which such Purchase Contract is a part. The "Settlement Rate" is equal
to (a) if the Applicable Market Value (as defined below) is greater than or
equal to $21.08 (the "Threshold Appreciation Price"), 2.3719 shares of Common
Stock per Purchase Contract, (b) if the Applicable Market Value is less than the
Threshold Appreciation Price but is greater than $17.28, the number of shares of
Common Stock per Purchase Contract equal to the Stated Amount divided by the
Applicable Market Value and (c) if the Applicable Market Value is less than or
equal to $17.28, 2.8935 shares of Common Stock per Purchase Contract, in each
case subject to adjustment as provided in the Purchase Contract Agreement. No
fractional shares of Common Stock will be issued upon settlement of Purchase
Contracts, as provided in the Purchase Contract Agreement.
The "Applicable Market Value" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Stock Purchase Date.
The "Closing Price" of the Common Stock on any date of determination
means the closing sale price (or, if no closing sale price is reported, the last
reported sale price) of the Common Stock on the New York Stock Exchange (the
"NYSE") on such date or, if the Common Stock is not listed for trading on the
NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States national or
regional securities exchange, as reported by The Nasdaq Stock Market, or, if the
Common Stock is not so reported, the last quoted bid price for the Common Stock
in the over-the-counter market as reported by the National Quotation Bureau or
similar organization, or, if such bid price is not available, the market value
of the Common Stock on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the Company.
A-6
A "Trading Day" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
Each Purchase Contract evidenced hereby may be settled prior to the
Stock Purchase Date through Cash Settlement, Early Settlement or Merger Early
Settlement, in accordance with the terms of the Purchase Contract Agreement.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Normal Units Certificate shall pay the Purchase Price for the
shares of Common Stock purchased pursuant to each Purchase Contract evidenced
hereby (i) by effecting a Cash Settlement, Early Settlement or Merger Early
Settlement, (ii) by application of payments received in respect of the Pledged
Treasury Consideration acquired from the proceeds of a remarketing of the
related Pledged Notes underlying the Normal Units represented by this Normal
Units Certificate, (iii) if the Holder has elected not to participate in the
remarketing, by application of payments received in respect of the Pledged
Treasury Consideration deposited by such Holder in respect of such Purchase
Contract or (iv) if a Tax Event Redemption has occurred prior to the successful
remarketing of the Notes by application of payments received in respect of the
Pledged Applicable Ownership Interest in the Treasury Portfolio purchased by the
Collateral Agent on behalf of the Holder of this Normal Units Certificate. If,
as provided in the Purchase Contract Agreement, upon the occurrence of a Last
Failed Remarketing the Collateral Agent, for the benefit of the Company,
exercises its rights as a secured creditor with respect to the Pledged Notes
related to this Normal Units Certificate, any accrued and unpaid interest on
such Pledged Notes will become payable by the Company to the Holder of this
Normal Units Certificate in the manner provided for in the Purchase Contract
Agreement.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment in full of the aggregate Purchase
Price for the shares of Common Stock to be purchased thereunder in the manner
herein set forth.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Pledged
Notes. Upon receipt of notice of any meeting at which holders of Notes are
entitled to vote or upon the solicitation of consents, waivers or proxies of
holders of Notes, the Agent shall, as soon as practicable thereafter, mail to
the Holders of Normal Units a notice (a) containing such information as is
contained in the notice or solicitation, (b) stating that each such Holder on
the record date set by the Agent therefor (which, to the extent possible, shall
be the same date as the record date for determining the holders of Notes
entitled to vote) shall be entitled to instruct the Agent as to the exercise of
the voting rights pertaining to the Pledged Notes constituting a part of such
Holder's Normal Units and (c) stating the
A-7
manner in which such instructions may be given. Upon the written request of the
Holders of Normal Units on such record date, the Agent shall endeavor insofar as
practicable to vote or cause to be voted, in accordance with the instructions
set forth in such requests, the maximum number of Pledged Notes as to which any
particular voting instructions are received. In the absence of specific
instructions from the Holder of a Normal Unit, the Agent shall abstain from
voting the Pledged Note evidenced by such Normal Unit.
The Normal Units Certificates are issuable only in registered form and
only in denominations of a single Normal Unit and any integral multiple thereof.
The transfer of any Normal Units Certificate will be registered and Normal Units
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The Normal Units Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents permitted by the Purchase
Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Agent may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. The Holder of a Normal Unit may substitute for
the Pledged Notes, Pledged Treasury Consideration or Pledged Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, securing its
obligations under the related Purchase Contract Treasury Securities in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement. From and after such Collateral Substitution, the Unit for which such
Pledged Treasury Securities secures the Holder's obligation under the Purchase
Contract shall be referred to as a "Stripped Unit." A Holder that elects to
substitute a Treasury Security for Pledged Notes, Pledged Treasury Consideration
or Pledged Applicable Ownership Interest in the Treasury Portfolio, as the case
may be, thereby creating Stripped Units, shall be responsible for any fees or
expenses payable in connection therewith. Except as provided in the Purchase
Contract Agreement, for so long as the Purchase Contract underlying a Normal
Unit remains in effect, such Normal Unit shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such Normal
Units in respect of the Pledged Note, Pledged Treasury Consideration or Pledged
Applicable Ownership Interest in the Treasury Portfolio, as the case may be, and
Purchase Contract constituting such Normal Unit may be transferred and exchanged
only as a Normal Unit.
A Holder of Stripped Units may reestablish Normal Units by delivering
to the Collateral Agent Notes or the appropriate Treasury Consideration or
Applicable Ownership Interest in the Treasury Portfolio, as the case may be, in
exchange for the release of the Pledged Treasury Securities in accordance with
the terms of the Purchase Contract Agreement and the Pledge Agreement.
Subject to the next succeeding paragraph, the Company shall pay, on
each Payment Date, the Contract Adjustment Payments, if any, payable in respect
of each Purchase Contract to the Person in whose name the Normal Units
Certificate evidencing such Purchase Contract is registered at the close of
business on the Record Date for such Payment Date. Contract Adjustment Payments,
if any, will be payable at the office of the Agent in The City of Wilmington,
Delaware or, at the option of the Company, by check
A-8
mailed to the address of the Person entitled thereto at such address as it
appears on the Normal Units Register or by wire transfer to the account
designated by such Person in writing.
The Company shall have the right, at any time prior to the Stock
Purchase Date, to defer the payment of any or all of the Contract Adjustment
Payments otherwise payable on any Payment Date, but only if the Company shall
give the Holders and the Agent written notice of its election to defer Contract
Adjustment Payments as provided in the Purchase Contract Agreement. Any Contract
Adjustment Payments so deferred shall, to the extent permitted by law, bear
additional Contract Adjustment Payments thereon at the rate of 6.50% per year
(computed on the basis of a 360-day year of twelve 30-day months), compounding
on each succeeding Payment Date, until paid in full (such deferred installments
of Contract Adjustment Payments, if any, together with the additional Contract
Adjustment Payments, if any, accrued thereon, are referred to herein as the
"Deferred Contract Adjustment Payments"). Deferred Contract Adjustment Payments,
if any, shall be due on the next succeeding Payment Date except to the extent
that payment is deferred pursuant to the Purchase Contract Agreement. No
Contract Adjustment Payments may be deferred to a date that is after the Stock
Purchase Date and no such deferral period may end other than on a Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until a Payment Date prior to the
Stock Purchase Date, then all Deferred Contract Adjustment Payments, if any,
shall be payable to the registered Holders as of the close of business on the
Record Date immediately preceding such Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until the Stock Purchase Date, the
Holder of this Normal Units Certificate will receive on the Stock Purchase Date,
in lieu of a cash payment, a number of shares of Common Stock (in addition to
the number of shares of Common Stock equal to the Settlement Rate) equal to (i)
the aggregate amount of Deferred Contract Adjustment Payments payable to the
Holder of this Normal Units Certificate divided by (ii) the Applicable Market
Value.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, then, until the Deferred Contract Adjustment
Payments have been paid, the Company shall not declare or pay dividends on, make
distributions with respect to, or redeem, purchase or acquire, or make a
liquidation payment with respect to, any of its Capital Stock other than (i)
purchases, redemptions or acquisitions of shares of Capital Stock in connection
with any employment contract, benefit plan or other similar arrangement with or
for the benefit of employees, officers or directors or a stock purchase or
dividend reinvestment plan, or the satisfaction by the Company of its
obligations pursuant to any contract or security outstanding on the date the
Company exercises its rights to defer the Contract Adjustment Payments; (ii) as
a result of a reclassification of the Company's Capital Stock or the exchange or
conversion of one
A-9
class or series of for another class or series of the Company's Capital Stock;
(iii) the purchase of fractional interests in shares of any series of the
Company's Capital Stock pursuant to the conversion or exchange provisions of
such Capital Stock or the security being converted or exchanged; (iv) dividends
or distributions in any series of the Company's Capital Stock (or rights to
acquire Capital Stock) or repurchases, acquisitions or redemptions of Capital
Stock in connection with the issuance or exchange of any series of Capital Stock
(or securities convertible into or exchangeable for shares of our Capital
Stock); or (v) redemptions, exchanges or repurchases of any rights outstanding
under a shareholder rights plan or the declaration or payment thereunder of a
dividend or distribution of or with respect to rights in the future.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay Contract Adjustment
Payments, if any, or any Deferred Contract Adjustment Payments, and the rights
of the Holders to purchase Common Stock, shall immediately and automatically
terminate, without the necessity of any notice or action by any Holder, the
Agent or the Company, if, on or prior to the Stock Purchase Date, a Termination
Event shall have occurred. Upon the occurrence of a Termination Event, the
Company shall promptly but in no event later than two Business Days thereafter
give written notice to the Agent, the Collateral Agent and to the Holders, at
their addresses as they appear in the Normal Units Register. Upon and after the
occurrence of a Termination Event, the Collateral Agent shall release the
Pledged Notes, Pledged Treasury Consideration or Pledged Applicable Ownership
Interest in the Treasury Portfolio, as the case may be, from the Pledge in
accordance with the provisions of the Pledge Agreement.
Upon registration of transfer of this Normal Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract Agreement
and the Purchase Contracts evidenced hereby and the transferor shall be released
from the obligations under the Purchase Contracts evidenced by this Normal Units
Certificate. The Company covenants and agrees, and the Holder, by its acceptance
hereof, likewise covenants and agrees, to be bound by the provisions of this
paragraph.
The Holder of this Normal Units Certificate, by its acceptance hereof,
authorizes the Agent to enter into and perform the related Purchase Contracts
forming part of the Normal Units evidenced hereby on his behalf as his attorney-
in-fact, expressly withholds any consent to the assumption (i.e., affirmance) of
the Purchase Contracts by the Company or its trustee in the event that the
Company becomes the subject of a case under the Bankruptcy Code, agrees to be
bound by the terms and provisions thereof, covenants and agrees to perform such
Holder's obligations under such Purchase Contracts, consents to the provisions
of the Purchase Contract Agreement, authorizes the Agent to enter into and
perform the Pledge Agreement on such Holder's behalf as attorney-in-fact, and
consents to the Pledge of the Notes or the appropriate Treasury
A-10
Consideration or Applicable Ownership Interest in the Treasury Portfolio, as the
case may be, underlying this Normal Units Certificate pursuant to the Pledge
Agreement. The Holder further covenants and agrees, that, to the extent and in
the manner provided in the Purchase Contract Agreement and the Pledge Agreement,
but subject to the terms thereof, payments in respect of the Pledged Notes,
Pledged Treasury Consideration or Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, to be paid upon settlement of such
Holder's obligations to purchase Common Stock under the Purchase Contract, shall
be paid on the Stock Purchase Date by the Collateral Agent to the Company in
satisfaction of such Holder's obligations under such Purchase Contract and such
Holder shall acquire no right, title or interest in such payments.
Each Holder of any Unit, and each Beneficial Owner thereof, by its
acceptance thereof or of its interest therein, further agrees to treat (i)
itself as the owner of the related Notes, Treasury Consideration, Applicable
Ownership Interest in the Treasury Portfolio or Treasury Securities, as the case
may be, and (ii) the Notes as indebtedness of the Company, in each case, for all
tax purposes.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to its principles of conflicts of laws.
The Company, the Agent and its Affiliates and any agent of the Company
or the Agent may treat the Person in whose name this Normal Units Certificate is
registered as the owner of the Normal Units evidenced hereby for the purpose of
receiving quarterly payments on the Notes, the Treasury Consideration or the
Applicable Ownership Interest in the Treasury Portfolio, as the case may be,
receiving payments of Contract Adjustment Payments, if any, and any Deferred
Contract Adjustment Payments, performance of the Purchase Contracts and for all
other purposes whatsoever, whether or not any payments in respect thereof be
overdue and notwithstanding any notice to the contrary, and neither the Company,
the Agent, such Affiliates nor any such agent shall be affected by notice to the
contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Agent.
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ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
UNIF GIFT MIN ACT -- Custodian
--------------------------------------------------------
(cust) (minor)
Under Uniform Gifts to Minors Act
--------------------------------------------------------
(State)
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship and not as
tenants in common
Additional abbreviations may also be used though not in the above list.
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ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto____________________________________________________________________________
________________________________________________________________________________
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)_______________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Normal Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing _______________________________________
attorney to transfer said Normal Units Certificates on the books of Motorola,
Inc. with full power of substitution in the premises.
Dated:_____________________________ Signature:_______________________________
NOTICE: The signature to this assignment
must correspond with the name as it
appears upon the face of the within
Normal Units Certificates in every
particular, without alteration or
enlargement or any change whatsoever.
Signature Guarantee:____________________________________________________________
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SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Stock Purchase Date of the
Purchase Contracts underlying the number of Normal Units evidenced by this
Normal Units Certificate be registered in the name of, and delivered, together
with a check in payment for any fractional share, to the undersigned at the
address indicated below unless a different name and address have been indicated
below. If shares are to be registered in the name of a Person other than the
undersigned, the undersigned will pay any transfer tax payable incident thereto.
Dated: Signature:
----------------------- ------------------------------
Signature Guarantee:
--------------------
(if assigned to another person)
If shares are to be registered REGISTERED HOLDER
in the name of and delivered
to a Person other than the Please print name and address of
Holder, please (i) print such Registered Holder:
Person's name and address and
(ii) provide a guarantee of
your signature:
------------------------------ -----------------------------------------
Name Name
------------------------------ -----------------------------------------
Address Address
Social Security or other
Taxpayer Identification Number,
if any
A-14
ELECTION TO SETTLE EARLY
The undersigned Holder of this Normal Units Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Normal Units evidenced by this Normal Units
Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Normal Units with
an aggregate Stated Amount equal to $1,000 or an integral multiple thereof. The
undersigned Holder directs that a certificate for shares of Common Stock
deliverable upon such Early Settlement be registered in the name of, and
delivered, together with a check in payment for any fractional share and any
Normal Units Certificate representing any Normal Units evidenced hereby as to
which Early Settlement of the related Purchase Contracts is not effected, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. Pledged Notes, Pledged Treasury Consideration or the
Pledged Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, deliverable upon such Early Settlement will be transferred in accordance
with the transfer instructions set forth below. If shares are to be registered
in the name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.
Dated: Signature:
----------------------------- ------------------------------
Signature Guarantee: Signature Guarantee:
--------------- --------------------
Number of Units evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:
If shares of Common Stock are to be REGISTERED HOLDER
registered in the name of and
delivered to and Pledged Notes, Please print name and address of
Pledged Treasury Consideration or Registered Holder:
Pledged Applicable Ownership
Interest in the Treasury Portfolio,
as the case may be, are to be
transferred to a Person other than
the Holder, please print such
Person's name and address:
------------------------------ -----------------------------------------
Name Name
------------------------------ -----------------------------------------
Address Address
Social Security or other
Taxpayer Identification Number,
if any
Transfer instructions for Pledged Notes, Pledged Treasury Consideration or the
Pledged Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, transferable upon Early Settlement or a Termination Event:
A-15
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have
been made:
Stated Amount
Amount of Amount of of the Global
Decrease in Increase in Certificate Signature of
Stated Amount Stated Amount Following Authorized
of the Global of the Global Such Decrease Officer of
Date Certificate Certificate or Increase Agent
-------- ------------- ------------- ------------- ------------
A-16
EXHIBIT B
FORM OF STRIPPED UNITS CERTIFICATE
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE
NAME OF THE CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE
EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER OF
THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized representative
of The Depository Trust Company (55 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) to the
Company or its agent for registration of transfer, exchange or payment, and any
Certificate issued is registered in the name of Cede & Co., or such other name
as requested by an authorized representative of The Depository Trust Company,
and any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.
(Form of Face of Stripped Units Certificate)
No. CUSIP No.
----------------
Number of Stripped Units
This Stripped Units Certificate certifies that Cede & Co. is the
registered Holder of the number of Stripped Units set forth above. Each Stripped
Unit represents (i) a 1/20 undivided beneficial ownership interest in a Treasury
Security, subject to the Pledge of such interest in such Treasury Security by
such Holder pursuant to the Pledge Agreement, and (ii) the rights and
obligations of the Holder under one Purchase Contract with Motorola, Inc., a
Delaware corporation (the "Company"), All capitalized terms used herein which
are defined in the Purchase Contract Agreement have the meaning set forth
therein.
Pursuant to the Pledge Agreement, the Treasury Security constituting
part of each Stripped Unit evidenced hereby has been pledged to the Collateral
Agent, for the benefit of the Company, to secure the obligations of the Holder
under the Purchase Contract comprising a part of such Stripped Unit.
Each Purchase Contract evidenced hereby obligates the Holder of this
Stripped Units Certificate to purchase, and the Company to sell, on November 16,
2004
B-1
(the "Stock Purchase Date"), at a price equal to $50 (the "Stated Amount"), a
number of shares of Common Stock, $0.01 par value per share ("Common Stock"), of
the Company, equal to the Settlement Rate, unless on or prior to the Stock
Purchase Date there shall have occurred a Termination Event or an Early
Settlement, Merger Early Settlement or Cash Settlement with respect to the
Stripped Units of which such Purchase Contract is a part, all as provided in the
Purchase Contract Agreement and more fully described on the reverse hereof. The
Purchase Price (as defined herein) for the shares of Common Stock purchased
pursuant to each Purchase Contract evidenced hereby, if not paid earlier, shall
be paid on the Stock Purchase Date by application of payments received in
respect of the Pledged Treasury Securities pledged to secure the obligations
under such Purchase Contract in accordance with the terms of the Pledge
Agreement.
The Company shall pay on each Payment Date in respect of each Purchase
Contract forming part of a Stripped Unit evidenced hereby an amount (the
"Contract Adjustment Payments") equal to 0.50% per year of the Stated Amount,
computed on the basis of a 360-day year of 12 30-day months, subject to deferral
at the option of the Company as provided in the Purchase Contract Agreement and
more fully described on the reverse hereof (provided that if on any date on
which Contract Adjustment Payments are to be made on the Purchase Contracts is
not a Business Day, then payment of the Contract Adjustment Payments payable on
that date will be made on the next succeeding day which is a Business Day, and
no interest or payment will be paid in respect of the delay, except that if such
next succeeding Business Day is in the next succeeding calendar year, such
payment will be made on the immediately preceding Business Day). Such Contract
Adjustment Payments shall be payable to the Person in whose name this Stripped
Units Certificate (or a Predecessor Stripped Units Certificate) is registered at
the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments will be payable at the office of the
Agent in the City of New York or, at the option of the Company, by check mailed
to the address of the Person entitled thereto as such address appears on the
Normal Units Register.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Stripped Units Certificate shall not be
entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.
B-2
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
MOTOROLA, INC.
By:
-------------------------------------
Name:
Title:
By:
-------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the Purchase
Contracts)
By: FIRST UNION TRUST COMPANY,
NATIONAL ASSOCIATION, not
individually but solely as Attorney-
in-Fact of such Holder
By:
-------------------------------------
Name:
Title:
B-3
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Stripped Units referred to in the within-mentioned
Purchase Contract Agreement.
FIRST UNION TRUST COMPANY,
NATIONAL ASSOCIATION,
as Purchase Contract Agent
Dated: By:
----------------------------- -----------------------------
Authorized Officer
B-4
(Reverse of Stripped Units Certificate)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of October 31, 2001 (as may be supplemented from
time to time, the "Purchase Contract Agreement"), between the Company and First
Union Trust Company, National Association, as Purchase Contract Agent (including
its successors thereunder, herein called the "Agent"), to which the Purchase
Contract Agreement and supplemental agreements thereto reference is hereby made
for a description of the respective rights, limitations of rights, obligations,
duties and immunities thereunder of the Agent, the Company and the Holders and
of the terms upon which the Stripped Units Certificates are, and are to be,
executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Stripped Units Certificate to purchase, and the Company to sell, on the Stock
Purchase Date at a price equal to $50 (the "Purchase Price"), a number of shares
of Common Stock of the Company equal to the Settlement Rate, unless, on or prior
to the Stock Purchase Date, there shall have occurred a Termination Event or an
Early Settlement, Merger Early Settlement or Cash Settlement with respect to the
Unit of which such Purchase Contract is a part. The "Settlement Rate" is equal
to (a) if the Applicable Market Value (as defined below) is greater than or
equal to $21.08 (the "Threshold Appreciation Price"), 2.3719 shares of Common
Stock per Purchase Contract, (b) if the Applicable Market Value is less than the
Threshold Appreciation Price but is greater than $17.28, the number of shares of
Common Stock per Purchase Contract equal to the Stated Amount divided by the
Applicable Market Value and (c) if the Applicable Market Value is less than or
equal to $17.28, 2.8935 shares of Common Stock per Purchase Contract, in each
case subject to adjustment as provided in the Purchase Contract Agreement. No
fractional shares of Common Stock will be issued upon settlement of Purchase
Contracts, as provided in the Purchase Contract Agreement.
The "Applicable Market Value" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Stock Purchase Date.
The "Closing Price" of the Common Stock on any date of determination
means the closing sale price (or, if no closing price is reported, the last
reported sale price) of the Common Stock on the New York Stock Exchange (the
"NYSE") on such date or, if the Common Stock is not listed for trading on the
NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States national or
regional securities exchange, as reported by The Nasdaq Stock Market, or, if the
Common Stock is not so reported, the last quoted bid price for the Common Stock
in the over-the-counter market as reported by the National Quotation Bureau or
similar organization, or, if such bid price is not available, the market value
of
B-5
the Common Stock on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the Company.
A "Trading Day" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
Each Purchase Contract evidenced hereby may be settled prior to the
Stock Purchase Date through Early Settlement, Merger Early Settlement or Cash
Settlement, in accordance with the terms of the Purchase Contract Agreement.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Stripped Units Certificate shall pay the Purchase Price for the
shares of Common Stock purchased pursuant to each Purchase Contract evidenced
hereby (i) by effecting an Early Settlement, Merger Early Settlement or Cash
Settlement or (ii) by application of payments received in respect of the Pledged
Treasury Securities underlying the Stripped Units represented by this Stripped
Units Certificate.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment in full of the aggregate Purchase
Price for the shares of Common Stock to be purchased thereunder in the manner
herein set forth.
The Stripped Units Certificates are issuable only in registered form
and only in denominations of a single Stripped Unit and any integral multiple
thereof. The transfer of any Stripped Units Certificate will be registered and
Stripped Units Certificates may be exchanged as provided in the Purchase
Contract Agreement. The Stripped Units Registrar may require a Holder, among
other things, to furnish appropriate endorsements and transfer documents
permitted by the Purchase Contract Agreement. No service charge shall be
required for any such registration of transfer or exchange, but the Company and
the Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. The Holder of a Stripped
Unit may substitute for the Pledged Treasury Securities securing its obligations
under the related Purchase Contract Notes or the appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury Portfolio in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement. From and after such substitution, the Unit for which such Pledged
Notes, Pledged Treasury Consideration or Pledged Applicable Ownership Interest
in the Treasury Portfolio secures the Holder's obligation under the Purchase
Contract shall be referred to as a "Normal Unit." A Holder that elects to
substitute Notes or the appropriate Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, for Pledged
Treasury Securities, thereby reestablishing Normal Units, shall be responsible
for any fees or expenses
B-6
payable in connection therewith. Except as provided in the Purchase Contract
Agreement, for so long as the Purchase Contract underlying a Stripped Unit
remains in effect, such Stripped Unit shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such Stripped
Unit in respect of the Pledged Treasury Security and the Purchase Contract
constituting such Stripped Unit may be transferred and exchanged only as a
Stripped Unit.
Subject to the next succeeding paragraph, the Company shall pay, on
each Payment Date, the Contract Adjustment Payments, payable in respect of each
Purchase Contract to the Person in whose name the Stripped Units Certificate
evidencing such Purchase Contract is registered at the close of business on the
Record Date for such Payment Date. Contract Adjustment Payments, if any, will be
payable at the office of the Agent in The City of Wilmington, Delaware or, at
the option of the Company, by check mailed to the address of the Person entitled
thereto at such address as it appears on the Stripped Units Register.
The Company shall have the right, at any time prior to the Stock
Purchase Date, to defer the payment of any or all of the Contract Adjustment
Payments otherwise payable on any Payment Date, but only if the Company shall
give the Holders and the Agent written notice of its election to defer Contract
Adjustment Payments as provided in the Purchase Contract Agreement. Any Contract
Adjustment Payments so deferred shall, to the extent permitted by law, bear
additional Contract Adjustment Payments thereon at the rate of 6.50% per year
(computed on the basis of a 360-day year of 12 30-day months), compounding on
each succeeding Payment Date, until paid in full (such deferred installments of
Contract Adjustment Payments, if any, together with the additional Contract
Adjustment Payments accrued thereon, are referred to herein as the "Deferred
Contract Adjustment Payments"). Deferred Contract Adjustment Payments, if any,
shall be due on the next succeeding Payment Date except to the extent that
payment is deferred pursuant to the Purchase Contract Agreement. No Contract
Adjustment Payments may be deferred to a date that is after the Stock Purchase
Date and no such deferral period may end other than on a Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until a Payment Date prior to the
Stock Purchase Date, then all Deferred Contract Adjustment Payments, if any,
shall be payable to the registered Holders as of the close of business on the
Record Date immediately preceding such Payment Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until the Stock Purchase Date, the
Holder of this Stripped Units Certificate will receive on the Stock Purchase
Date, in lieu of a cash payment, a number of shares of Common Stock (in addition
to the number of shares of Common Stock equal to the Settlement Rate) equal to
(i) the aggregate amount
B-7
of Deferred Contract Adjustment Payments payable to the Holder of this Stripped
Units Certificate divided by (ii) the Applicable Market Value.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, then, until the Deferred Contract Adjustment
Payments have been paid, the Company shall not declare or pay dividends on, make
distributions with respect to, or redeem, purchase or acquire, or make a
liquidation payment with respect to, any of its Capital Stock other than (i)
purchases, redemptions or acquisitions of shares of Capital Stock in connection
with any employment contract, benefit plan or other similar arrangement with or
for the benefit of employees, officers or directors or a stock purchase or
dividend reinvestment plan, or the satisfaction by the Company of its
obligations pursuant to any contract or security outstanding on the date the
Company exercises its rights to defer the Contract Adjustment Payments; (ii) as
a result of a reclassification of the Company's Capital Stock or the exchange or
conversion of one class or series of the Company's Capital Stock for another
class or series of the Company's Capital Stock; (iii) the purchase of fractional
interests in shares of the Company's Capital Stock pursuant to the conversion or
exchange provisions of such Capital Stock or the security being converted or
exchanged; (iv) dividends or distributions in Capital Stock (or rights to
acquire Capital Stock) or repurchases, acquisitions or redemptions of Capital
Stock in connection with the issuance or exchange of Capital Stock (or
securities convertible into or exchangeable for shares of our Capital Stock); or
(v) redemptions, exchanges or repurchases of any rights outstanding under a
shareholder rights plan or the declaration or payment thereunder of a dividend
or distribution of or with respect to rights in the future.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay Contract Adjustment
Payments, if any, or any Deferred Contract Adjustment Payments, and the rights
and obligations of Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Agent or the Company, if, on or prior to the Stock Purchase Date, a
Termination Event shall have occurred. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two business days
thereafter give written notice to the Agent, the Collateral Agent and to the
Holders, at their addresses as they appear in the Stripped Units Register. Upon
and after the occurrence of a Termination Event, the Collateral Agent shall
release the Pledged Treasury Securities from the Pledge in accordance with the
provisions of the Pledge Agreement.
Upon registration of transfer of this Stripped Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract Agreement
and the Purchase Contracts evidenced hereby and the transferor shall be released
from the obligations
B-8
under the Purchase Contracts evidenced by this Stripped Units Certificate. The
Company covenants and agrees, and the Holder, by his acceptance hereof, likewise
covenants and agrees, to be bound by the provisions of this paragraph.
The Holder of this Stripped Units Certificate, by his acceptance
hereof, authorizes the Agent to enter into and perform the related Purchase
Contracts forming part of the Stripped Units evidenced hereby on his behalf as
its attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Purchase Contracts by the Company or its trustee in the event
that the Company becomes the subject of a case under the Bankruptcy Code, agrees
to be bound by the terms and provisions thereof, covenants and agrees to perform
such Holder's obligations under such Purchase Contracts, consents to the
provisions of the Purchase Contract Agreement, authorizes the Agent to enter
into and perform the Pledge Agreement on such Holder's behalf as attorney-in-
fact, and consents to the Pledge of the Treasury Securities underlying this
Stripped Units Certificate pursuant to the Pledge Agreement. The Holder further
covenants and agrees, that, to the extent and in the manner provided in the
Purchase Contract Agreement and the Pledge Agreement, but subject to the terms
thereof, payments in respect of the Pledged Treasury Securities, to be paid upon
settlement of such Holder's obligations to purchase Common Stock under the
Purchase Contract, shall be paid on the Stock Purchase Date by the Collateral
Agent to the Company in satisfaction of such Holder's obligations under such
Purchase Contract and such Holder shall acquire no right, title or interest in
such payments.
Each Holder of any Unit, and each Beneficial Owner thereof, by its
acceptance thereof or of its interest therein, further agrees to treat (i)
itself as the owner of the related Notes, Treasury Consideration or Treasury
Securities, as the case may be, and (ii) the Notes as indebtedness of the
Company, in each case, for United States federal, state and local income and
franchise tax purposes.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York, without regard
to its principles of conflicts of laws.
The Company, the Agent and its Affiliates and any agent of the Company
or the Agent may treat the Person in whose name this Stripped Units Certificate
is registered as the owner of the Stripped Units evidenced hereby for the
purpose of receiving any Contract Adjustment Payments and any Deferred Contract
Adjustment Payments performance of the Purchase Contracts and for all other
purposes whatsoever, whether or not any payments in respect thereof be overdue
and notwithstanding any
B-9
notice to the contrary, and neither the Company, the Agent, such Affiliate, nor
any such agent shall be affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Agent.
B-10
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - Custodian
________________________________
(cust) (minor)
Under Uniform Gifts to Minors Act
________________________________
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and
not as tenants in common
Additional abbreviations may also be used though not in the above list.
B-11
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and transfer(s)
unto
________________________________________________________________________________
________________________________________________________________________________
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
________________________________________________________________________________
________________________________________________________________________________
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Stripped Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing ______________________________ attorney
to transfer said Stripped Units Certificates on the books of Motorola, Inc. with
full power of substitution in the premises.
Dated:________________ Signature:__________________________________
NOTICE: The signature to this assignment
must correspond with the name as it
appears upon the face of the within
Stripped Units Certificates in every
particular, without alteration or
enlargement or any change whatsoever.
Signature Guarantee:____________________________________________________________
B-12
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Stock Purchase Date of the
Purchase Contracts underlying the number of Stripped Units evidenced by this
Stripped Units Certificate be registered in the name of, and delivered, together
with a check in payment for any fractional share, to the undersigned at the
address indicated below unless a different name and address have been indicated
below. If shares are to be registered in the name of a Person other than the
undersigned, the undersigned will pay any transfer tax payable incident thereto.
Dated:_______________________ Signature:__________________________________
Signature Guarantee:________________________
(if assigned to another person)
If shares are to be registered in REGISTERED HOLDER
the name of and delivered to a
Person other than the Holder,
please (i) print such Person's Please print name and address of
name and address and (ii) Registered Holder:
provide a guarantee of your
signature:
---------------------------------- ---------------------------------------
Name Name
---------------------------------- ---------------------------------------
Address Address
Social Security or other Taxpayer Identification
Number, if any
B-13
ELECTION TO SETTLE EARLY
The undersigned Holder of this Stripped Units Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Stripped Units evidenced by this Stripped
Units Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Stripped Units with
an aggregate Stated Amount equal to $1,000 or an integral multiple thereof. The
undersigned Holder directs that a certificate for shares of Common Stock
deliverable upon such Early Settlement be registered in the name of, and
delivered, together with a check in payment for any fractional share and any
Stripped Units Certificate representing any Stripped Units evidenced hereby as
to which Early Settlement of the related Purchase Contracts is not effected, to
the undersigned at the address indicated below unless a different name and
address have been indicated below. Pledged Treasury Securities deliverable upon
such Early Settlement will be transferred in accordance with the transfer
instructions set forth below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.
Dated: Signature:
------------------------ --------------------------
Signature Guarantee:
----------------
Number of Units evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:
If shares of Common Stock are to be REGISTERED HOLDER
registered in the name of and
delivered to and Pledged Treasury Please print name and address
Securities are to be transferred to of Registered Holder:
a Person other than the Holder,
please print such Person's name and
address:
----------------------------------- -----------------------------------
Name Name
----------------------------------- -----------------------------------
Address Address
Social Security or other Taxpayer Identification
Number, if any
Transfer instructions for Pledged Treasury Securities, transferable upon Early
Settlement or a Termination Event:
B-14
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have
been made:
Stated Amount
Amount of Amount of of the Global
Decrease in Increase in Certificate Signature of
Stated Amount Stated Amount Following Authorized
of the Global of the Global Such Decrease Officer of
Date Certificate Certificate or Increase Agent
---------------- ------------- ------------- ------------- ------------
B-15
EXHIBIT C
INSTRUCTION FROM PURCHASE CONTRACT AGENT TO
COLLATERAL AGENT
The Chase Manhattan Bank
as Collateral Agent
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Institutional Trust Services
Telecopy: (000) 000-0000
Re: Equity Security Units of Motorola, Inc. (the "Company")
We hereby notify you in accordance with Section 4.1 of the Pledge
Agreement, dated as of October 31, 2001, among the Company, you, as Collateral
Agent, Custodial Agent and Securities Intermediary, and us, as Purchase Contract
Agent and as attorney-in-fact for the holders of [Normal Units] [Stripped Units]
from time to time, that the holder of securities listed below (the "Holder") has
elected to substitute [$_______ aggregate principal amount of Treasury
Securities (CUSIP No. _____)] [$_______ principal amount of Notes or the
appropriate Treasury Consideration, as the case may be,] in exchange for the
related [Pledged Notes, Pledged Treasury Consideration or Pledged Applicable
Ownership Interest in the Treasury Portfolio, as the case may be (CUSIP No.
____),] [Pledged Treasury Securities] held by you in accordance with the Pledge
Agreement and has delivered to us a notice stating that the Holder has
transferred [Treasury Securities] [Notes or the appropriate Treasury
Consideration or Applicable Ownership Interest in the Treasury Portfolio, as the
case may be,] to you, as Collateral Agent. We hereby instruct you, upon receipt
of such [Pledged Treasury Securities] [Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be], and upon the payment by such Holder of any
applicable fees, to release the [Notes, Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio, as the case may be,] [Treasury
Securities] related to such [Normal Units] [Stripped Units] to us in accordance
with the Holder's instructions.
Date:
------------------------------
FIRST UNION TRUST COMPANY,
NATIONAL ASSOCIATION,
By:
---------------------------------
Name:
Title:
C-1
Please print name and address of Registered Holder electing to substitute
[Treasury Securities] [Notes or Treasury Consideration or Applicable Ownership
Interest in the Treasury Portfolio, as the case may be,] for the [Pledged Notes,
Pledged Treasury Consideration or Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be,] [Pledged Treasury Securities]:
Name
Address
Social Security or other Taxpayer
Identification Number, if any
C-2
EXHIBIT D
INSTRUCTION TO PURCHASE CONTRACT AGENT
First Union Trust Company, National Association
Xxx Xxxxxx Xxxxxx, Xxxxx 000
000 Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx, 00000
Attention: Corporate Trust Administration,
Telecopy: (000) 000-0000
Attention:
Re: Equity Security Units of Motorola, Inc. (the "Company")
The undersigned Holder hereby notifies you that it has delivered to
The Chase Manhattan Bank, as Collateral Agent, Custodial Agent and Securities
Intermediary [$_________ aggregate principal amount of Treasury Securities]
[$_________ principal amount of Notes or the appropriate Treasury Consideration
or Applicable Ownership Interest in the Treasury Portfolio, as the case may be,]
in exchange for the related [Pledged Notes, Pledged Treasury Consideration or
Pledged Applicable Ownership Interest in the Treasury Portfolio, as the case may
be,] [Pledged Treasury Securities] held by the Collateral Agent, in accordance
with Section 4.1 of the Pledge Agreement, dated October 31, 2001, among you, the
Company and the Collateral Agent. The undersigned Holder has paid the Collateral
Agent all applicable fees relating to such exchange. The undersigned Holder
hereby instructs you to instruct the Collateral Agent to release to you on
behalf of the undersigned Holder the [Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be,] [Pledged Treasury Securities] related to such
[Normal Units] [Stripped Units].
Date: By:
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Signature Guarantee:
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Dated:
Please print name and address of
Registered Holder:
Name Social Security or other Taxpayer
Identification Number, if any
Address
D-1
EXHIBIT E
NOTICE TO SETTLE BY SEPARATE CASH
First Union Trust Company, National Association
Xxx Xxxxxx Xxxxxx, Xxxxx 000
000 Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx, 00000
Attention: Corporate Trust Administration,
Telecopy: (000) 000-0000
Re: Equity Security Units of Motorola Corporation (the "Company")
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The undersigned Holder hereby irrevocably notifies you in accordance
with Section 5.5 of the Purchase Contract Agreement dated as of October 31, 2001
among the Company and yourselves, as Purchase Contract Agent and as Attorney-in-
Fact for the Holders of the Purchase Contracts, that such Holder has elected to
pay to the Collateral Agent, on or prior to 11:00 a.m. New York City time, on
the Business Day immediately preceding the Stock Purchase Date, (in lawful money
of the United States by [certified or cashiers check or] wire transfer, in each
case in immediately available funds), $_________ as the Purchase Price for the
shares of Common Stock issuable to such Holder by the Company under the related
Purchase Contract on the Stock Purchase Date. The undersigned Holder hereby
instructs you to notify promptly the Collateral Agent of the undersigned Holders
election to make such cash settlement with respect to the Purchase Contracts
related to such Holder's [Normal Units] [Stripped Units].
Dated:
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Signature:
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Signature Guarantee:
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Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Please print name and address of Registered Holder:
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Social Security or other Taxpayer Identification Number, if any:
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E-1
