EXHIBIT 4
PURCHASE CONTRACT AGREEMENT
BETWEEN
SPRINT CORPORATION
AND
BANK ONE, NATIONAL ASSOCIATION,
AS PURCHASE CONTRACT AGENT
DATED AS OF August [ ], 2001
TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Other Provisions
of General Applications
SECTION 1.1. Definitions................................................................................1
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Section 1.2. Compliance Certificates and Opinions......................................................18
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SECTION 1.3. Form of Documents Delivered to Agent......................................................19
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SECTION 1.4. Acts of Holders; Record Dates.............................................................20
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SECTION 1.5. Notices...................................................................................22
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SECTION 1.6. Notice to Holders; Waiver.................................................................22
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SECTION 1.7. Effect of Headings and Table of Contents..................................................23
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SECTION 1.8. Successors and Assigns....................................................................23
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SECTION 1.9. Separability Clause.......................................................................23
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SECTION 1.10. Benefits of Agreement.....................................................................23
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SECTION 1.11. Governing Law.............................................................................24
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SECTION 1.12. Legal Holidays............................................................................24
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SECTION 1.13. Counterparts..............................................................................24
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SECTION 1.14. Inspection of Agreement...................................................................24
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ARTICLE II
Certificate Forms
SECTION 2.1. Forms of Certificates Generally...........................................................25
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SECTION 2.2. Form of Agent's Certificate of
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Authentication...........................................................26
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ARTICLE III
The Securities
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SECTION 3.1. Title and Terms; Denominations............................................................26
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SECTION 3.2. Rights and Obligations Evidenced by the
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Certificates.............................................................26
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SECTION 3.3. Execution, Authentication, Delivery
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and Dating...............................................................28
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SECTION 3.4. Temporary Certificates....................................................................29
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SECTION 3.5. Registration; Registration of Transfer
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and Exchange.............................................................29
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SECTION 3.6. Book-Entry Interests......................................................................31
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SECTION 3.7. Notices to Holders........................................................................32
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SECTION 3.8. Appointment of Successor Clearing
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Agency...................................................................32
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SECTION 3.9. Definitive Certificates...................................................................32
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SECTION 3.10. Mutilated, Destroyed, Lost and Stolen
Certificates.............................................................32
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SECTION 3.11. Persons Deemed Owners.....................................................................34
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SECTION 3.12. Cancelation...............................................................................34
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SECTION 3.13. Establishment of Treasury Units...........................................................35
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SECTION 3.14. Reestablishment of Corporate Units........................................................37
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SECTION 3.15. Transfer of Collateral upon Occurrence
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of Termination Event.....................................................39
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SECTION 3.16. No Consent to Assumption..................................................................40
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SECTION 3.17. CUSIP Numbers.............................................................................40
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ARTICLE IV
The Notes and the Applicable Ownership Interest of the Treasury Portfolio
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SECTION 4.1. Interest and Other Payments; Rights to
Payments Preserved; Distribution
Rate Reset; Notice........................................................................40
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SECTION 4.2. Notice and Voting.........................................................................42
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SECTION 4.3. Tax Event Redemption......................................................................43
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SECTION 4.4. CUSIP Numbers.............................................................................43
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ARTICLE V
The Purchase Contracts
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SECTION 5.1. Purchase of Shares of PCS Common Stock....................................................44
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SECTION 5.2. Contract Adjustment Payments. ...........................................................45
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SECTION 5.5. Initial and Subsequent Remarketing........................................................54
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SECTION 5.6. Payment of Purchase Price; Final
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Remarketing..............................................................56
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SECTION 5.7. Issuance of Shares of PCS Common Stock....................................................60
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SECTION 5.8. Adjustment of Settlement Rate.............................................................61
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SECTION 5.8. Adjustment of Settlement Rate.............................................................64
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SECTION 5.9. Notice of Adjustments and Certain
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Other Events.............................................................72
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SECTION 5.10. Termination Event; Notice................................................................72
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SECTION 5.11. Early Settlement.........................................................................73
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SECTION 5.12. No Fractional Shares.....................................................................75
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SECTION 5.13. Charges and Taxes........................................................................76
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ARTICLE VI
Remedies
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SECTION 6.1. Unconditional Right of Holders to
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Purchase PCS Common Stock.................................................................76
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SECTION 6.2. Restoration of Rights and Remedies........................................................76
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SECTION 6.3. Rights and Remedies Cumulative............................................................77
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SECTION 6.4. Delay or Omission Not Waiver..............................................................77
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SECTION 6.5. Undertaking for Costs.....................................................................77
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SECTION 6.6. Waiver of Stay or Extension Laws..........................................................78
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ARTICLE VII
The Agent
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SECTION 7.1. Certain Duties and Responsibilities.......................................................78
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SECTION 7.2. Notice of Default.........................................................................79
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SECTION 7.3. Certain Rights of Agent...................................................................79
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SECTION 7.4. Not Responsible for Recitals or
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Issuance of Securities...................................................80
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SECTION 7.5. May Hold Securities.......................................................................80
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SECTION 7.6. Money Held in Custody.....................................................................80
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SECTION 7.7. Compensation and Reimbursement............................................................81
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SECTION 7.8. Corporate Agent Required; Eligibility.....................................................81
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SECTION 7.9. Resignation and Removal; Appointment of
Successor................................................................82
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SECTION 7.10. Acceptance of Appointment by Successor...................................................83
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SECTION 7.11. Merger, Conversion, Consolidation or
Succession to Business...................................................84
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SECTION 7.12. Preservation of Information;
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Communications to Holders................................................84
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SECTION 7.13. No Obligations of Agent..................................................................85
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SECTION 7.14. Tax Compliance...........................................................................85
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ARTICLE VIII
Supplemental Agreements
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SECTION 8.1. Supplemental Agreements Without Consent
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of Holders...............................................................86
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SECTION 8.2. Supplemental Agreements with Consent
of Holders...............................................................86
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SECTION 8.3. Execution of Supplemental Agreements......................................................88
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SECTION 8.4. Effect of Supplemental Agreements.........................................................88
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SECTION 8.5. Reference to Supplemental Agreements......................................................88
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ARTICLE IX
Consolidation, Merger, Sale or Conveyance
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SECTION 9.1. Covenant Not to Merge, Consolidate,
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Sell or Convey Property Except Under
Certain Conditions.......................................................88
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SECTION 9.2. Rights and Duties of Successor
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Corporation..............................................................89
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SECTION 9.3. Opinion of Counsel Given to Agent.........................................................90
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ARTICLE X
Covenants
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SECTION 10.1. Performance Under Purchase Contracts.....................................................90
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SECTION 10.2. Maintenance of Office or Agency..........................................................90
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SECTION 10.3. Company to Reserve PCS Common Stock......................................................91
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SECTION 10.4. Covenants as to PCS Common Stock.........................................................91
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ARTICLE XI
Assignment
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SECTION 11.1. Assignment of Agreement..................................................................91
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EXHIBIT A Form of Corporate Units Certificate
EXHIBIT B Form of Treasury 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
PURCHASE CONTRACT AGREEMENT, dated as of August [ ], 2001 between
Sprint Corporation, a Kansas corporation (the "Company"), and Bank One, National
Association, a national banking corporation, acting as purchase contract agent
for the Holders of Securities from time to time (the "Agent").
WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed as follows:
ARTICLE I
Definitions and Other Provisions
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of General Applications
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SECTION 1.1. Definitions. For all purposes of this
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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;
(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 of 1933, as amended, as is in effect on the date
hereof.
"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.
"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 Benchmark Treasury" means direct obligations of
the United States, which may be obligations traded on a when-issued basis only,
having a maturity comparable to the remaining term to maturity of the Notes, as
agreed upon by the Company and the Reset Agent. The rate for the Applicable
Benchmark Treasury will be the bid side rate displayed at 10:00 A.M., New York
City time, on the applicable Reset Date in the Telerate system (or if the
Telerate system is no longer available on such Reset Date or in the opinion of
the Reset Agent, after consultation with the Company, no longer an appropriate
system from which to obtain such rate, such other nationally recognized
quotation system as, in the opinion of the Reset Agent, after consultation with
the Company, is appropriate). If such rate is not so displayed, the rate for the
Applicable Benchmark Treasury shall be, as calculated by the Reset Agent, the
yield to maturity for the Applicable Benchmark Treasury, expressed as a bond
equivalent on the basis of a year of 365 or 366 days, as applicable, and applied
on a daily basis, and computed by taking the arithmetic mean of the secondary
market bid rates, as of 10:30 A.M., New York City time, on such Reset Date of
three leading United States government securities dealers selected by the Reset
Agent after consultation with the Company (which may include the Reset Agent or
an Affiliate thereof).
"Applicable Market Value" means the average of the Closing
Price per share of PCS Common Stock on each of
the 20 consecutive Trading Days ending on the third Trading Day immediately
preceding the Purchase Contract Settlement Date or, for purposes of determining
cash payable in lieu of fractional shares in connection with an Early
Settlement, the third Trading Day immediately preceding the relevant Early
Settlement Date.
"Applicable Ownership Interest" means, with respect to a
Corporate Unit and the Treasury Securities in the Treasury Portfolio, (i) a
1/40, or 2.5%, 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 that matures on or prior to August 15, 2004
and (ii) for the scheduled interest payment date on the Notes that occurs on the
Purchase Contract Settlement Date, in the case of a Successful Initial
Remarketing or Successful Subsequent Remarketing, or after the Tax Event
Redemption Date and on or before the Purchase Contract Settlement Date, in the
case of a Tax Event Redemption, a ___% undivided beneficial ownership interest
in a $1,000 face amount of such Treasury Security which is a principal or
interest strip maturing before such interest payment date.
"Applicable Principal Amount" means the aggregate principal
amount of the Notes which are (i) components of Corporate Units on the Initial
Remarketing Date, any Subsequent Remarketing Date or the Final Remarketing Date,
as applicable or (ii) are not components of Corporate Units but are validly
tendered for remarketing by the Holder of such Notes on any Remarketing Date.
"Authorized Newspaper" means a daily newspaper, in the English
language, customarily published on each day that is a Business Day in The City
of New York, whether or not published on days that are Legal Holidays, and of
general circulation in The City of New York. The Authorized Newspaper for the
purposes of the Reset Announcement Date may be The Wall Street Journal.
"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 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 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 the board of directors of the
Company or a duly authorized committee of that board.
"Board Resolution" means one or more resolutions of the Board
of Directors, a copy of which has been certified by the Secretary or an
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
and 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 other than a Saturday, a Sunday
or any other day on which banking institutions and trust companies in ▇▇▇ ▇▇▇▇
▇▇▇▇ (▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇) are permitted or required by any applicable law
to close.
"Cash Settlement" has the meaning set forth in Section
5.6(a)(i).
"Certificate" means a Corporate Units Certificate or a
Treasury Units Certificate.
"Class A Common Stock" means the Company's Class A common
stock, par value $2.50 per share.
"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 Securities 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 Securities.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time the
Clearing Agency effects book entry transfers and pledges of securities deposited
with the Clearing Agency.
"Closing Price" of the PCS 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 PCS Common Stock on the NYSE on such date
or, if the PCS 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
national or regional securities exchange on which the PCS Common Stock is so
listed, or if the PCS Common Stock is not so listed on a United States national
or regional securities exchange, as reported by the Nasdaq National Market or,
if the PCS Common Stock is not so reported, the last quoted bid price for the
PCS 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 PCS Common Stock on such date as determined
by a nationally recognized independent investment banking firm retained for this
purpose by the Company.
"Collateral" has the meaning specified in Section 2.1 of the
Pledge Agreement.
"Collateral Agent" means Bank One, National Association, 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.
"Common Equity Securities" means shares of a class of stock of
the Company that is not entitled to priority over any other class of stock of
the Company in
the payment of dividends or with respect to rights upon the liquidation,
dissolution or winding up of the Company.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor or assignee shall have become
such pursuant to the applicable provision of this Agreement, and thereafter
"Company" shall mean such successor or assignee.
"Contract Adjustment Payments" means, in the case of Corporate
Units and Treasury Units, the amount payable by the Company in respect of each
Purchase Contract constituting a part of such Corporate Unit or Treasury Unit,
equal to [ ]% per year of the Stated Amount, in each case computed on the basis
of a 360 day year of twelve 30 day months, plus (i) any Deferred Contract
Adjustment Payments accrued pursuant to Section 5.2 and (ii) the amount of any
Dividend Adjustment Amount.
"Conversion" has the meaning specified in Section 5.8(b).
"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
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Street, Mail Code OH1-0181, ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention:
Global Corporation Trust Services Division.
"Corporate Units" means the collective rights and obligations
of a Holder of a Corporate Units Certificate in respect of a Note or an
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, subject in each case to the Pledge thereof, and the related Purchase
Contract.
"Corporate Units Certificate" means a certificate evidencing
the rights and obligations of a Holder in respect of the number of Corporate
Units specified on such certificate.
"Corporate Units Register" and "Corporate Units Registrar"
have the respective meanings specified in Section 3.5.
"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
5.8(a)(8).
"Depositary" means, initially, DTC until another Clearing
Agency becomes its successor.
"Deferred Contract Adjustment Payments" has the meaning
specified in Section 5.4.
"Dividend Adjustment Amount" shall mean, (i) to the extent all
outstanding shares of PCS Common Stock are converted or recapitalized into
shares of any other capital stock or the annual dividend rate on the PCS Common
Stock is increased after the date of this Agreement, an amount equal to the
regular cash dividends paid on the maximum number of shares of capital stock or
PCS Common Stock, as the case may be, purchasable upon the settlement of each
Purchase Contract or (ii) if the Company merges, consolidates or consummates any
other business combination with, or sells, assigns, transfers, leases or conveys
all or substantially all of its assets and properties to, any person or
institution that is not organized and existing under the laws of the United
States or any U.S. State or the District of Columbia and, as a result, the
Contract Adjustment Payments become subject to withholding taxes imposed by one
or more non-U.S. jurisdictions, an amount equal to the amount necessary so that
the amount of Contract Adjustment Payments actually received by Holders will be
the same, net of non-U.S. withholding taxes, as if the non-U.S. withholding
taxes were not imposed on the Contract Adjustment Payments.
"DTC" means The Depository Trust Company, the initial Clearing
Agency.
"Early Settlement" has the meaning specified in Section
5.11(a).
"Early Settlement Amount" has the meaning specified in Section
5.11(a).
"Early Settlement Date" has the meaning specified in Section
5.11(a).
"Early Settlement Rate" has the meaning specified in Section
5.11(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.
"Expiration Time" has the meaning specified in Section
5.8(a)(6).
"Failed Final Remarketing" has the meaning specified in
Section 5.4(b).
"Failed Remarketing" has the meaning specified in Section 5.5.
"Final Remarketing" has the meaning specified in Section
5.6(b).
"Final Remarketing Date" has the meaning specified in Section
5.4(b).
"FON Common Stock" means the FON Common Stock, Series 1, par
value $2.00 per share, of the Company.
"Global Note Certificate" means a certificate evidencing the
respective rights and obligations of Holders in respect of the number of Notes
specified on such certificate and which is registered in the name of a Clearing
Agency or a nominee thereof.
"Global Certificate" means a Certificate that evidences all or
part of the Securities and is registered in the name of a Depositary or a
nominee thereof.
"Holder", when used with respect to a Security, means the
Person in whose name the Security evidenced by a Corporate Units Certificate
and/or Treasury Units
Certificate is registered in the related Corporate Units Register and/or
Treasury Units Register, as the case may be.
"Indenture" means the Indenture dated as of October 1, 1998
between the Company, Sprint Capital and the Indenture Trustee, as amended and
supplemented by the First Supplemental Indenture dated as of January 15, 1999
between the Company, Sprint Capital and the Indenture Trustee pursuant to which
the Notes will be issued by Sprint Capital.
"Indenture Trustee" means Bank One, National Association, a
national banking association, as trustee under the Indenture, or any successor
thereto.
"Initial Remarketing" has the meaning specified in Section
5.3.
"Initial Remarketing Date" means the third Business Day
immediately preceding May 17, 2004.
"Issuer Order" or "Issuer Request" means a written order or
request signed in the name of the Company by its Chairman of the Board, its
President or a Vice President and by its Chief Financial Officer, its Treasurer,
an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered
to the Agent.
"NYSE" means the New York Stock Exchange, Inc..
"New York Office" shall have the meaning set forth in
Section 10.2
"Notes" means the series of notes of Sprint Capital designated
the ___% Senior Notes due 2006 and fully and unconditionally guaranteed by the
Company pursuant to the Indenture, to be issued under the Indenture as of the
date hereof.
"Notes Holder" or "Holder of Notes" means the Person in whose
name the Note evidenced by a Notes Certificate is registered in the Debt
Securities Register under the Indenture.
"Notes Terms" means the resolutions of the pricing committee
of the Board of Directors of Sprint Capital Corporation dated as of _________,
2001 setting forth the terms and conditions of the Notes pursuant to the
Indenture.
"Officer's Certificate" means a certificate of the Company
signed on its behalf by the Chairman of the Board, the President, any Vice
President, the Treasurer, any Assistant Treasurer, the Secretary or any
Assistant Secretary 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.
"Outstanding Securities," with respect to the Corporate Units
or Treasury Units, means, as of the date of determination, all Corporate Units
or Treasury Units, as the case may be, evidenced by Certificates theretofore
authenticated, executed and delivered under this Agreement, except:
(i) If a Termination Event has occurred, (A) Treasury Units
for which the Stated Amount of Treasury Securities has been theretofore
deposited with the Agent in trust for the Holders of such Treasury
Units and (B) Corporate Units for which the Stated Amount of the
related Notes or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, has been theretofore deposited
with the Agent in trust for the Holders of such Corporate Units;
(ii) Corporate Units or Treasury Units evidenced by
Certificates theretofore canceled by the Agent or delivered to the
Agent for cancelation or deemed canceled pursuant to the provisions of
this Agreement; and
(iii) Corporate Units or Treasury 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
Corporate Units or Treasury Units evidenced by such Certificate are
valid obligations of the Company;
provided, however, that in determining whether the Holders of
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the requisite number of the Corporate Units or Treasury Units have given any
request, demand, authorization, direction, notice, consent or waiver hereunder,
Corporate Units or Treasury 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
Corporate Units or Treasury Units which a Responsible Officer of the Agent knows
to be so owned shall be so disregarded. Corporate Units or Treasury Units so
owned which have been pledged in good faith may be regarded as Outstanding
Securities if the pledge establishes to the satisfaction of the Agent the
pledge's right so to act with respect to such Corporate Units or Treasury Units
and that the pledge is not the Company or any Affiliate of the Company.
"Payment Date" means each February 17, May 17, August 17 and
November 17, commencing November 17, 2001.
"PCS Common Stock" means the PCS Common Stock, Series 1, $1.00
par value per share, of the Company, or(i) if all outstanding shares of PCS
Common Stock have been converted into shares of FON Common Stock, Series 1, par
value $2.00 per share (the "FON Common Stock"), pursuant to the Company's
articles of incorporation, the FON Common Stock or (ii) if all outstanding
shares of PCS Common Stock have been redeemed in exchange for shares of common
stock of one or more wholly-owned subsidiaries of the Company (the "Subsidiary
Common Stock") pursuant to Section 7.2 of Article Sixth of the Company's
articles of incorporation, the Subsidiary Common Stock, or (iii) or any other
successor securities as contemplated by this Agreement.
"PCS Conversion Provisions" mean Section 7.1(A)(2) of Article
Sixth of the Company's Articles of Incorporation, as amended, or any successor
provisions.
"PCS Mandatory Redemption Provision" means Section
7.1(A)(1)(b)(i) or (ii) of Article Sixth of the Company's Articles of
Incorporation, as amended, or any successor provision.
"PCS Optional Redemption Provision" means Section 7.2 of
Article Sixth of the Company's Articles of Incorporation, as amended, or any
successor provision.
"PCS Stock Redemption" has the meaning specified in Section
5.8(d).
"Permitted Investments" has the meaning set forth in Section 1
of the Pledge Agreement.
"Person" means a legal person, including any individual,
corporation, estate, partnership, joint venture, association, joint-stock
company, limited liability company, trust, unincorporated association or
government or any agency or political subdivision thereof or any other entity of
whatever nature.
"Pledge" means the pledge under the Pledge Agreement of the
Notes or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, and of the Treasury Securities, in each case
constituting a part of the Securities.
"Pledge Agreement" means the Pledge Agreement, dated as of the
date hereof, by and among the Company, the Collateral Agent and the Agent, on
its own behalf and as attorney-in-fact for the Holders from time to time of the
Securities, as the same may hereafter be amended in accordance with the terms
thereof.
"Predecessor Certificate" means a Predecessor Corporate Units
Certificate or a Predecessor Treasury Units Certificate.
"Predecessor Corporate Units Certificate" of any particular
Corporate Units Certificate means every previous
Corporate Units Certificate evidencing all or a portion of the rights and
obligations of the Company and the Holder under the Corporate Units evidenced
thereby; and, for the purposes of this definition, any Corporate Units
Certificate authenticated and delivered under Section 3.10 in exchange for or in
lieu of a mutilated, destroyed, lost or stolen Corporate 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 Corporate Units Certificate.
"Predecessor Treasury Units Certificate" of any particular
Treasury Units Certificate means every previous Treasury Units Certificate
evidencing all or a portion of the rights and obligations of the Company and the
Holder under the Treasury Units evidenced thereby; and, for the purposes of this
definition, any Treasury Units Certificate authenticated and delivered under
Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Treasury 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 Treasury Units Certificate.
"Primary Treasury Dealer" means a primary U.S. government
securities dealer in The City of New York.
"Proceeds" has the meaning set forth in Section 1 of the
Pledge Agreement.
"Purchase Contract", when used with respect to any Security,
means the contract forming a part of such Security and obligating the Company to
sell and the Holder of such Security to purchase PCS Common Stock on the terms
and subject to the conditions set forth in this Agreement.
"Purchase Contract Settlement Date" means August 17, 2004.
"Purchase Contract Settlement Fund" has the meaning specified
in Section 5.7.
"Purchase Price" has the meaning specified in Section 5.1.
"Purchased Shares" has the meaning specified in
Section 5.8(a)(6).
"Quotation Agent" means (i) any of ▇.▇. ▇▇▇▇▇▇ Securities
Inc., ▇▇▇▇▇▇▇ ▇▇▇▇▇ Government Securities, Inc. or UBS Warburg LLC or their
respective successors, or (ii) any other Primary Treasury Dealer selected by the
Company.
"Recapitalization Transaction" has the meaning specified in
Section 5.8(b)(1).
"Record Date" for the distribution payable in respect of the
Notes or the Applicable Ownership Percentage of the Treasury Portfolio payable
on any Payment Date means the first day of the month in which the relevant
Payment Date occurs.
"Redemption Amount" means, for each Note, the product of (i)
the principal amount of such Note and (ii) a fraction the numerator of which is
the applicable Treasury Portfolio Purchase Price and the denominator of which is
the applicable Tax Event Redemption Principal Amount.
"Redemption Early Settlement" has the meaning specified in
Section 5.8(d).
"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 Corporate Units Register and the
Treasury Units Register.
"Registrar" means the Corporate Units Registrar and the
Treasury Units Registrar.
"Remarketing Agent" has the meaning set forth in the
Remarketing Agreement.
"Remarketing Agreement" means the Remarketing Agreement dated
as of August [ ], 2001 by and among the Company, Sprint Capital, UBS Warburg LLC
and the Purchase Contract Agent.
"Remarketing Fee" has the meaning specified in Section 5.5.
"Reorganization Event" has the meaning specified in Section
5.8(c).
"Reset Agent" has the meaning set forth in the Remarketing
Agreement.
"Reset Announcement Date" means, the tenth Business Day
immediately preceding any Reset Effective Date.
"Reset Date" means the date of any Successful Remarketing.
"Reset Effective Date" means the third Business Day
immediately following any Reset Date.
"Reset Rate" means the interest rate per annum (as determined
by the Reset Agent), equal to the sum of (i) the Reset Spread and (ii) the rate
of interest on the Applicable Benchmark Security in effect on the Reset Date.
"Reset Spread" means (i) if the Reset Date is on or prior to
the twelfth Business Day before August 17, 2004, a spread amount to be
determined by the Reset Agent on the applicable Reset Announcement Date as the
appropriate spread so that the Reset Rate will be the interest rate that the
Notes should bear in order for the Applicable Principal Amount of Notes to have
an approximate aggregate market value of 100.5% of the Treasury Portfolio
Purchase Price on such Reset Date and (ii) if the Reset Date is on the third
Business Day immediately prior to August 17, 2004, a spread amount determined by
the Reset Agent on the applicable Reset Announcement Date as the appropriate
spread so that the Reset Rate will be the interest rate that the Notes should
bear in order for the Notes to have an approximate market value of 100.5% of
their principal amount on the third Business Day immediately prior to August 17,
2004.
"Responsible Officer," when used with respect to the Agent,
means any officer of the Agent assigned by the Agent to administer its corporate
trust matters.
"Security" means a Corporate Unit or a Treasury Unit.
"Senior Indebtedness" means, with respect to Contract
Adjustment Payments, indebtedness of any kind of the Company unless the
instrument under which such indebtedness is incurred expressly provides that it
is on a parity in right of payment with or subordinate in right of payment to
the Contract Adjustment Payments.
"Settlement Rate" has the meaning specified in Section 5.1.
"Spin-Off Transaction" means a transfer or other distribution
by the Company of a significant portion of its assets and liabilities to holders
of any class of its common stock through a spin-off, split-off, split-up or
other similar transaction.
"Sprint Capital" means Sprint Capital Corporation, a Delaware
corporation.
"Stated Amount" means $25.00.
"Subsequent Remarketing" has the meaning specified in Section
5.5(a).
"Subsequent Remarketing Date" has the meaning specified in
Section 5.5(a).
"Subsidiary" means (i) a corporation, a majority of whose
capital stock with voting power, under ordinary circumstances, to elect
directors is, at the date of determination, directly or indirectly owned by the
Company, by one or more Subsidiaries of the Company or by the Company and one or
more Subsidiaries of the Company, (ii) a partnership in which the Company or a
Subsidiary of the Company holds a majority interest in the equity capital or
profits of such partnership, or (iii) any other person (other than a
corporation) in which the Company, a Subsidiary of the Company or the Company
and one or more Subsidiaries the Company, directly or indirectly, at the date of
determination, has (x) at least a majority ownership interest or (y) the power
to elect or direct the election of a majority of the directors or other
governing body of such person.
"Substitute Securities" means (i) obligations fully guaranteed
by the United States of America; (ii) demand deposits, time deposits or
certificates of deposit of depository institutions or trust companies, the
commercial paper, if any, of which has the highest rating from the rating
agencies; (iii) commercial paper or other short-term obligations having, at the
time of the investment therein, a rating in the highest rating category from the
rating agencies; or (iv) notes or bankers' acceptances issued by any depository
institutions or trust companies, the commercial paper, if any, of which has the
highest rating from the rating agencies.
"Successful Final Remarketing" has the meaning specified in
Section 5.6(b).
"Successful Initial Remarketing" has the meaning specified in
Section 5.5.
"Successful Remarketing" means any of a Successful Initial
Remarketing, Successful Subsequent Remarketing or Successful Final Remarketing.
"Successful Subsequent Remarketing" has the meaning specified
in Section 5.5(a).
"Tax Event" means the receipt by the Company of an opinion of
a nationally recognized independent tax counsel experienced in such matters
(which may be King & Spalding) to the effect that, as a result of (i) any
amendment to, change in, or 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, (ii) any amendment to or
change in an interpretation or application of such laws or regulations by any
legislative body, court, governmental agency or regulatory authority or (iii)
any interpretation or pronouncement that provides for a position with respect to
such laws or regulations that differs from the generally accepted position on
the date the Notes are issued, which amendment, change or proposed change is
effective or which interpretation or pronouncement is announced on or after the
date of the first issuance of Notes under the Indenture, there is more than an
insubstantial risk that interest or original issue
discount paid or accrued by Sprint Capital on the Notes would not be deductible,
in whole or in part, by the Company or Sprint Capital for United States federal
income tax purposes.
"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 notice.
"Tax Event Redemption Date" means the date upon which a Tax
Event Redemption is to occur.
"Tax Event Redemption Principal Amount" means either (i) if
the Tax Event Redemption Date occurs prior to August 17, 2004 or any earlier
Successful Remarketing, the aggregate principal amount of the Notes which are
components of Corporate Units on the Tax Event Redemption Date or (ii) if the
Tax Event Redemption Date occurs on or after August 17, 2004 or any earlier
Successful Remarketing, the aggregate principal amount of the Notes outstanding
on such Tax Event Redemption Date.
"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 Purchase Contract
Settlement Date, a judgment, decree or court order shall have been entered
granting relief under the Bankruptcy Code, adjudicating the Company to be
insolvent, or approving as properly filed a petition seeking reorganization or
liquidation of the Company or any other similar applicable Federal or State law,
and, unless such judgment, decree or order shall have been entered within 60
days prior to the
Purchase Contract Settlement Date, such decree or order shall have continued
undischarged and unstayed for a period of 60 days; or (ii) at any time on or
prior to the Purchase Contract Settlement Date, 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
Purchase Contract Settlement 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 Purchase Contract Settlement Date the Company shall file
a petition for relief under the Bankruptcy Code, 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 applicable 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.
"TIA" means the Trust Indenture Act of 1939, as amended, or
any successor statute.
"Trading Day" means a day on which the PCS Common Stock (i) 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 (ii) 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 PCS Common Stock.
"Treasury Portfolio" means (1) in connection with the Initial
Remarketing or any Subsequent Remarketing, a portfolio of Treasury Securities
consisting of (a) principal or interest strips of Treasury Securities which
mature on or prior to August 15, 2004 in an aggregate amount equal to the
Applicable Principal Amount and (b) with respect to the scheduled interest
payment date on the Notes that occurs on the Purchase Contract Settlement Date,
principal or interest strips of Treasury Securities which mature on or prior to
August 15, 2004 in an aggregate amount equal to the aggregate interest payment
that would be due on the Applicable Principal Amount of the Notes on such date
if the Coupon Rate on the Notes were not reset to the Reset Rate and (2) in
connection with a Tax Event Redemption, (a) if the Tax Event Redemption Date
occurs
prior to August 17, 2004 or any earlier Successful Remarketing, a portfolio of
zero-coupon Treasury Securities consisting of (i) principal or interest strips
of Treasury Securities which mature on or prior to August 15, 2004 in an
aggregate amount equal to the applicable Tax Event Redemption Principal Amount
and (ii) with respect to each scheduled interest payment date on the Notes that
occurs after the Tax Event Redemption Date and on or before the Purchase
Contract Settlement Date, principal or interest strips of Treasury Securities
which 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 applicable Tax
Event Redemption Principal Amount of the Notes on such date if the Coupon Rate
on the Notes were not reset to the Reset Rate, and (b) if the Tax Event
Redemption Date occurs on or after August 17, 2004 or any earlier Successful
Remarketing, a portfolio of zero-coupon Treasury Securities consisting of (i)
principal or interest strips of Treasury Securities which mature on or prior to
August 15, 2006 in an aggregate amount equal to the applicable Tax Event
Redemption Principal Amount and (ii) with respect to each scheduled interest
payment date on the Notes that occurs after the Tax Event Redemption Date,
principal or interest strips of such Treasury Securities which 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 applicable Tax Event
Redemption Principal Amount of the Notes on such date. The Company may in its
sole discretion choose to substitute Substitute Securities for the Treasury
Securities which compose the Treasury Portfolio, in which case such Substitute
Securities shall be deemed to be Treasury Securities for all purposes under this
definition.
"Treasury Portfolio Purchase Price" means the lowest aggregate
price quoted by a Primary Treasury Dealer to the Quotation Agent (i) in the case
of a Tax Event Redemption, on the third Business Day immediately preceding the
Tax Event Redemption Date for the purchase of the applicable Treasury Portfolio
for settlement on the Tax Event Redemption Date and (ii) in the case of any
Successful Remarketing other than the Final Remarketing for the purchase of the
applicable Treasury Portfolio for settlement on the third Business Day
immediately after such Successful Remarketing.
"Treasury Security" or "Treasury Securities" means zero-coupon
U.S. Treasury Securities (CUSIP Number ▇▇▇▇▇▇▇▇▇) which are the principal strip
of the U.S. Treasury Securities which mature on August 15, 2004.
"Treasury Units" means the collective rights and obligations
of a Holder of a Treasury Units Certificate in respect of the Treasury
Securities, subject to the Pledge thereof, and the related Purchase Contract.
"Treasury Units Certificate" means a certificate evidencing
the rights and obligations of a Holder in respect of the number of Treasury
Units specified on such certificate.
"Treasury Units Register" and "Treasury Units Registrar" have
the respective meanings specified in Section 3.5.
"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."
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 reasonably
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:
(1) a statement that each Person signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) 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;
(3) a statement that, in the opinion of each such Person, he
or she or it 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
(4) a statement as to whether, in the opinion of each such
Person, such condition or covenant has been complied with.
SECTION 1.3. Form of Documents Delivered to Agent. 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.
Any certificate or opinion of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless the Company 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
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, the Company stating that the information with respect to
such factual matters is in the possession of the Company unless the Person
giving such certificate or Opinion of 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 Securities shall be proved by the
Corporate Units Register or the Treasury 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 Securities 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 Securities. If any record date is set pursuant to this
paragraph, the Holders of the Outstanding Securities, on such record date, and
no other Holders, shall be entitled to take the relevant action with respect to
the Corporate Units or the Treasury 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 Securities 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 canceled
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
Securities 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
Securities in the manner set forth in Section 1.6.
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 Securities 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,
(1) 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 or mailed, first-class postage prepaid, to the
Agent at ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention: Global Corporate Trust
Services Division, or at any other address previously furnished in
writing by the Agent to the Holders and the Company; or
(2) 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 or mailed, first-class postage prepaid, to the
Company at Sprint Corporation, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Secretary, or at any other address
previously furnished in writing to the Agent by the Company; or
(3) 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 or mailed, first-class postage
prepaid, addressed to the Collateral Agent at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ Street,
Mail Code OH1-0181, ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, Attention: Global Corporate
Trust Services Division, or at any other address previously furnished
in writing by the Collateral Agent to the Agent, the Company and the
Holders; or
(4) the Indenture 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 or mailed, first-class postage prepaid, addressed to the
Indenture Trustee at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇,
Attention: Global Corporate Trust Services Division, or at any other
address previously furnished in writing by the Indenture Trustee to the
Company.
SECTION 1.6. Notice to Holders; Waiver. 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 shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
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,
then, to the extent permitted by law, 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 Securities, 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 applicable terms and
conditions hereof and of the Securities evidenced by their Certificates by their
acceptance of delivery of such Certificates.
SECTION 1.11. Governing Law. THIS AGREEMENT AND THE SECURITIES
--------------
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
SECTION 1.12. Legal Holidays. (a) In any case where any
---------------
Purchase Contract Settlement Date shall not be a Business Day, then
(notwithstanding any other provision of this Agreement, the Corporate Units
Certificates or the Treasury Units 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 Purchase Contract Settlement 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 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, in each case with the same force
and effect as if made on that Payment Date.
SECTION 1.13. Counterparts. This Agreement may be executed in
-------------
any number of counterparts by the parties hereto on separate counterparts, 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.
SECTION 1.15. Consent to Tax Treatment of Securities. Each
---------------------------------------
Holder of a Security, by acceptance thereof, shall be deemed to have agreed (i)
to treat itself (or, if the Holder holds the Security on behalf of the actual
beneficial owner of the Security in a nominee, custodial, or similar
arrangement, such actual beneficial owner) as the owner, for U.S. federal income
tax purposes, of the Notes or the Applicable Ownership Interest of the Treasury
Portfolio included in such Holder's Corporate Units, or the Treasury Securities
included in such Holder's Treasury Units, as the case may be and (ii) to treat
the Notes as indebtedness for U.S. federal income tax purposes.
ARTICLE II
Certificate Forms
-----------------
SECTION 2.1. Forms of Certificates Generally. The Corporate
--------------------------------
Units Certificates (including the form of Purchase Contract forming part of the
Corporate 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 on
which the Corporate Units are listed or any depositary therefor, or as may,
consistently herewith, be
determined by the officers of the Company executing such Corporate Units
Certificates, as evidenced by their execution of the Corporate Units
Certificates.
The definitive Corporate 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
Corporate Units Certificates, consistent with the provisions of this Agreement,
as evidenced by their execution thereof.
The Treasury Units Certificates (including the form of
Purchase Contract forming part of the Treasury 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 on which the Treasury Units are listed or any
depositary therefor, or as may, consistently herewith, be determined by the
officers of the Company executing such Treasury Units Certificates, as evidenced
by their execution of the Treasury Units Certificates.
The definitive Treasury 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
Treasury Units Certificates, consistent with the provisions of this Agreement,
as evidenced by their execution thereof.
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.
----------------------------------------------
The form of the Agent's certificate of authentication of the Corporate Units
shall be in substantially the form set forth on the form of the Corporate Units
Certificates.
The form of the Agent's certificate of authentication of the
Treasury Units shall be in substantially the form set forth on the form of the
Treasury Units Certificates.
ARTICLE III
The Securities
--------------
SECTION 3.1. Title and Terms; Denominations. The aggregate
---------------------------------------------
number of Corporate Units and Treasury Units evidenced by Certificates
authenticated, executed on behalf of the Holders and delivered hereunder is
limited to 40,000,000 (or 46,000,000 if the Underwriters' overallotment option
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, 3.9, 3.10, 3.13, 3.14, 5.9 or
8.5.
The Certificates shall be issuable only in registered form and
only in denominations of a single Corporate Unit or Treasury Unit and any
integral multiple thereof.
SECTION 3.2. Rights and Obligations Evidenced by the
---------------------------------------
Certificates. Each Corporate Units Certificate shall evidence the number of
------------
Corporate Units specified therein, with each such Corporate Unit representing
the ownership by the Holder thereof of a beneficial interest in a Note or the
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
subject to the Pledge of such Note or the Applicable Ownership Interest of 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 Corporate Unit shall pledge, pursuant to the
Pledge Agreement, the Note or the Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, forming a part of such Corporate 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 or the Applicable
Ownership Interest of 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 PCS Common Stock of the Company.
Each Treasury Units Certificate shall evidence the number of
Treasury Units specified therein, with each such Treasury Unit representing the
ownership by the Holder thereof of a 1/40, or 2.5%, undivided beneficial
interest in a Treasury Security with a principal amount at maturity equal to
$1,000, subject to the Pledge of 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. The Agent as attorney-in-fact for,
and on behalf of, the Holder of each Treasury Unit shall pledge, pursuant to the
Pledge Agreement, the beneficial interest in the Treasury Security to the
Collateral Agent and grant to the Collateral Agent a security interest in the
right, title and interest of such Holder in such Treasury Security, for the
benefit of the Company, to secure the obligation of the Holder under each
Purchase Contract to purchase the PCS Common Stock of the Company.
Prior to the purchase of PCS Common Stock under each Purchase
Contract, such Purchase Contracts shall not entitle the Holder of a Security to
any of the rights of a holder of shares of PCS Common Stock, including, without
limitation, the right to vote or receive any dividends or other payments or to
consent or to receive notice as a stockholder 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 a shareholder of the Company, except
as expressly provided under Section 5.2(a).
SECTION 3.3. Execution, Authentication, Delivery and Dating.
-----------------------------------------------
Subject to the provisions of Sections 3.13 and
3.14 hereof, 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.
The Certificates shall be executed on behalf of the Company by
its Chairman of the Board, its President or one of its Vice Presidents and its
Treasurer or one of its Assistant Treasurers or its Secretary or one of its
Assistant Secretaries. The signature of any of these officers on the
Certificates may be manual or facsimile.
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.
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 evidence that the Holder of such Certificate has entered into the
Purchase Contracts evidenced by such Certificate.
Each Certificate shall be dated the date of its
authentication.
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. 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
Corporate Units or Treasury Units are listed, or as may, consistently herewith,
be determined by the officers of the Company executing such Certificates, as
evidenced by their execution of the Certificates.
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 or the New York office, at the
expense of the Company and without charge to the Holder. Upon surrender for
cancelation 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
Corporate Units or Treasury 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 Corporate Units or Treasury Units, as the case
may be, evidenced thereby as definitive Certificates.
SECTION 3.5. Registration; Registration of Transfer and
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Exchange. The Agent shall keep at the Corporate Trust Office a Register (the
--------
"Corporate Units Register") in which, subject to such reasonable regulations as
it may prescribe, the Agent shall provide for the
registration of Corporate Units Certificates and of transfers of Corporate Units
Certificates (the Agent, in such capacity, the "Corporate Units Registrar") and
a Register (the "Treasury Units Register") in which, subject to such reasonable
regulations as it may prescribe, the Agent shall provide for the registration of
Treasury Units Certificates and of transfers of Treasury Units Certificates (the
Agent, in such capacity, the "Treasury Units Registrar").
Upon surrender for registration of transfer of any Certificate
at the Corporate Trust Office or the New York 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 any
authorized denominations, like tenor, and evidencing a like number of Corporate
Units or Treasury Units, as the case may be.
At the option of the Holder, Certificates may be exchanged for
other Certificates, of any authorized denominations and evidencing a like number
of Corporate Units or Treasury Units, as the case may be, upon surrender of the
Certificates to be exchanged at the Corporate Trust Office or the New York
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.
All Certificates issued upon any registration of transfer or
exchange of a Certificate shall evidence the ownership of the same number of
Corporate Units or Treasury Units, as the case may be, and be entitled to the
same benefits and subject to the same obligations, under this Agreement as the
Corporate Units or Treasury Units, as the case may be, evidenced by the
Certificate surrendered upon such registration of transfer or exchange.
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.
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 of Certificates, other than any exchanges pursuant to
Sections 3.4, 3.9 and 8.5 not involving any transfer.
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
Purchase Contract Settlement 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 Purchase Contract
Settlement Date has occurred, deliver the shares of PCS Common Stock issuable in
respect of the Purchase Contracts forming a part of the Securities evidenced by
such Certificate (together with any cash or other property to which the Holder
is entitled), or (ii) if a Termination Event shall have occurred prior to the
Purchase Contract Settlement Date, transfer the Notes, the appropriate
Applicable Ownership Interest of 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 Five hereof.
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 Securities
and the sole holder of the Global Certificate(s) and shall have no
obligation to the Beneficial Owners;
(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 Securities 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 Securities, the Company may, in its sole discretion,
appoint a successor Clearing Agency with respect to the Securities.
SECTION 3.9. Definitive Certificates. If (i) a Clearing Agency
------------------------
elects to discontinue its services as securities depositary with respect to the
Securities 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
Securities, 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,
or one or more Notes, then upon surrender of the Global Certificates
representing the Book-Entry Interests with respect to the Securities by the
Clearing Agency, accompanied by registration instructions, the Company shall
cause definitive Certificates to be delivered to Beneficial Owners in accordance
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. 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 Corporate Units or Treasury Units, as the case may be, and bearing a
Certificate number not contemporaneously outstanding.
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
Corporate Units or Treasury Units, as the case may be, and bearing a Certificate
number not contemporaneously outstanding.
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 Purchase Contract Settlement 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 Purchase Contract Settlement Date has occurred, deliver the shares of PCS
Common Stock issuable in respect of the Purchase Contracts forming a part of the
Securities evidenced by such Certificate (together with any cash or other
property to which the Holder is entitled), or (ii) if a Termination Event shall
have occurred prior to the Purchase Contract Settlement Date, transfer the
Notes, the appropriate Applicable Ownership Interest of 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 Five hereof.
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
relation thereto and any other expenses (including the reasonable fees and
expenses of the Agent) connected therewith.
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 Security evidenced thereby, whether or not the destroyed, lost or stolen
Certificate (and the Securities 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.
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. 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 Corporate Units or Treasury Units
evidenced thereby, for the purpose of receiving interest on the Notes or on the
maturing quarterly interest strips of the Treasury Portfolio, as applicable,
receiving payment of Contract Adjustment Payments, performance of the Purchase
Contracts and for all other purposes whatsoever, whether or not any interest on
the Notes 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.
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. Cancelation. All Certificates surrendered for
------------
delivery of shares of PCS Common Stock on or after the Purchase Contract
Settlement Date, upon the transfer of Notes, the appropriate Applicable
Ownership Interest of the Treasury Portfolio or Treasury Securities, as the case
may be, after the occurrence of a Termination Event or pursuant to an Early
Settlement, or upon the registration of a transfer or exchange of a Security, or
a Collateral Substitution or the re-establishment of a Corporate Unit or
Treasury Unit shall, if surrendered to any Person other than the Agent, be
delivered to the Agent and, if not already canceled, shall be promptly canceled
by it. The Company may at any time deliver to the Agent for cancelation 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 canceled 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 canceled as provided in
this Section, except as expressly permitted by this Agreement. All canceled
Certificates held by the Agent shall upon written request be returned to the
Company.
If the Company or any Affiliate of the Company shall acquire
any Certificate, such acquisition shall not operate as a cancelation of such
Certificate unless and until such Certificate is delivered to the Agent canceled
or for cancelation.
SECTION 3.13. Establishment of Treasury Units. A Holder may
--------------------------------
separate the Notes or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as applicable, from the related Purchase Contracts in
respect of a Corporate Unit by substituting for such Notes or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
Treasury Securities in an aggregate principal amount of such Notes or the
appropriate Applicable Ownership Interest (as specified in clause (i) of the
definition of such term) of the Treasury Portfolio, as applicable (a "Collateral
Substitution"), at any time from and after the date of this Agreement and on or
prior to the fifth Business Day immediately
preceding the Purchase Contract Settlement Date in the case of the Notes and on
or prior to the second Business Day immediately preceding the Purchase Contract
Settlement Date in the case of the appropriate Applicable Ownership Interest of
the Treasury Portfolio, in each case by:
(a) depositing with the Collateral Agent Treasury Securities
having an aggregate principal amount equal to the aggregate principal
amount of the Notes comprising part of such Corporate Units or the
appropriate Applicable Ownership Interest (as specified in clause (A)
of the definition of such term) of the Treasury Portfolio comprising
part of such Corporate Units, as the case may be, and
(b) transferring the related Corporate 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 Notes or
the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, underlying such Corporate Units,
whereupon the Agent shall promptly give such instruction to the
Collateral Agent, substantially in the form of Exhibit C hereto.
Upon receipt of the Treasury Securities described in clause
(a) above and the instruction described in clause (b) above, in accordance with
the terms of the Pledge Agreement, the Collateral Agent will release to the
Agent, on behalf of the Holder, Notes or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, having the appropriate
aggregate principal amount in the case of such Notes or the appropriate
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 Corporate Units;
(ii) transfer the Notes or the appropriate 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 Treasury Units Certificate executed by the Company in
accordance with Section 3.3 evidencing the same number of Purchase
Contracts as were evidenced by the canceled Corporate Units.
Holders who elect to separate the Notes or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
from the related Purchase Contract and to substitute Treasury Securities for
such Notes or the appropriate 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.
Holders may make Collateral Substitutions (i) only in integral
multiples of 40 Corporate Units if Notes are being substituted for by Treasury
Securities, or (ii) only in integral multiples of ___ Corporate Units if the
appropriate Applicable Ownership Interests of the Treasury Portfolio are being
substituted for by Treasury Securities.
In the event a Holder making a Collateral Substitution
pursuant to this Section 3.13 fails to effect a book-entry transfer of the
Corporate Units or fails to deliver a Corporate Units Certificate(s) to the
Agent after depositing Treasury Securities with the Collateral Agent, the Notes
or the appropriate Applicable Ownership Interest of the Treasury Portfolio, as
the case may be, constituting a part of such Corporate Units, and any interest
on such Note or the Applicable Ownership Interest of 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 Corporate Units are so transferred or
the Corporate Units Certificate is so delivered, as the case may be, or, with
respect to a Corporate Units Certificate, such Holder provides evidence
satisfactory to the Company and the Agent that such Corporate Units Certificate
has been destroyed, lost or stolen, together with any indemnity that may be
required by the Agent and the Company.
Except as described in this Section 3.13, for so long as the
Purchase Contract underlying a Corporate Unit remains in effect, such Corporate
Unit shall not be separable into its constituent parts, and the rights and
obligations of the Holder in respect of the Notes or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be, and Purchase
Contract comprising such Corporate Unit may be acquired, and may be transferred
and exchanged, only as a Corporate Unit.
SECTION 3.14. Reestablishment of Corporate Units. A Holder of
-----------------------------------
a Treasury Unit may recreate Corporate Units at any time (i) if a Tax Event
Redemption or a Successful Remarketing has not occurred, on or prior to the
fifth Business Day immediately preceding the Purchase Contract Settlement Date,
and (ii) if a Tax Event Redemption or a Successful Remarketing has occurred and
an Applicable Ownership Interest in the Treasury Portfolio has become a
component of the Corporate Units, on or prior to the second Business Day
immediately preceding the Purchase Contract Settlement Date, in each case by:
(a) depositing with the Collateral Agent Notes or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as
the case may be, having an aggregate principal amount in the case of
the Notes, or an appropriate Applicable Ownership Interest (as defined
in clause (i) of the definition of such term) of the Treasury
Portfolio, as the case may be, equal to the aggregate principal amount
of the Treasury Securities comprising part of the Treasury Units and
(b) transferring the related Treasury 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 Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, to the Collateral Agent and
requesting that the Agent instruct the Collateral Agent to release the
Treasury Securities underlying such Treasury Units, whereupon the Agent
shall promptly give such instruction to the Collateral Agent,
substantially in the form of Exhibit C hereto.
Upon receipt of the Notes or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be, described in
clause (a) above and the instruction described in clause (b) above, in
accordance with the terms of the Pledge Agreement, the Collateral Agent will
release to the Agent, on behalf of the Holder, the Treasury Securities having a
corresponding aggregate principal amount 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 Treasury Units;
(ii) transfer the Treasury Securities to the Holder; and
(iii) authenticate, execute on behalf of such Holder and
deliver a Corporate Units Certificate executed by the Company in
accordance with Section 3.3 evidencing the same number of Purchase
Contracts as were evidenced by the canceled Treasury Units.
Holders of Treasury Units may reestablish Corporate Units in
integral multiples of 40 Treasury Units for 40 Corporate Units if a Tax Event
Redemption or a Successful Remarketing has not occurred, and in integral
multiples of ____ Treasury Units for ___ Corporate Units if a Tax Event or a
Successful Remarketing has occurred.
In the event a Holder re-establishing Corporate Units pursuant
to this Section 3.14 fails to effect a book-entry transfer of the Treasury Units
or fails to deliver a Treasury Units Certificate(s) to the Agent after
depositing Notes or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, with the Collateral Agent, the Treasury
Securities constituting a part of such Treasury Units shall be held in the name
of the Agent or its nominee in trust for the benefit of such Holder, until such
Treasury Units are so transferred or the Treasury Units Certificate is so
delivered, as the case may be, or, with respect to a Treasury Units Certificate,
such Holder provides evidence satisfactory to the Company and the Agent that
such Treasury Units Certificate has been destroyed, lost or stolen, together
with any indemnity that may be required by the Agent and the Company.
Except as provided in this Section 3.14, for so long as the
Purchase Contract underlying a Treasury Unit remains in effect, such Treasury
Unit shall not be separable into its constituent parts and the rights and
obligations of the Holder of such Treasury Unit in respect of the Treasury
Security and Purchase Contract comprising such Treasury Unit may be acquired,
and may be transferred and exchanged, only as a Treasury 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 Applicable Ownership Interest of the
Treasury Portfolio or the Treasury Securities, as the case may be, underlying
the Corporate Units and the Treasury Units pursuant to the terms of the Pledge
Agreement, the Agent shall request transfer instructions with respect to such
Notes or the appropriate Applicable Ownership Interest of the Treasury Portfolio
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 Corporate Units
Register or the Treasury Units Register, as the case may be. Upon book-entry
transfer of the Corporate Units or Treasury Units or delivery of a Corporate
Units Certificate or Treasury Units Certificate to the Agent with such transfer
instructions, the Agent shall transfer the Notes, the Applicable Ownership
Interest of the Treasury Portfolio or Treasury Securities, as the case may be,
underlying such Corporate Units or Treasury Units, as the case may be, to such
Holder by book-entry transfer, or other appropriate procedures, in accordance
with such instructions; provided, however, that, to the extent that a Holder of
Corporate Units or Treasury Units would otherwise be entitled to receive less
than $1,000 principal amount at maturity of the Treasury Portfolio or the
Treasury Securities, the Agent shall dispose of such securities for cash, and
transfer the appropriate amount of such cash to such Holder in accordance with
such Holder's instructions. In the event a Holder of Corporate Units or Treasury
Units fails to effect such transfer or delivery, the Notes, the appropriate
Applicable Ownership Interest of the Treasury Portfolio or Treasury Securities,
as the case may be, underlying such Corporate Units or Treasury 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 Corporate Units or Treasury Units are transferred or the Corporate
Units Certificate or Treasury Units Certificate is surrendered or such Holder
provides satisfactory evidence that such Corporate Units Certificate or Treasury
Units Certificate has been destroyed, lost 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
-------------------------
Security, 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, receiver, liquidator or a person or
entity performing similar functions, 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.
SECTION 3.17. CUSIP Numbers. The Company in issuing the
--------------
Securities may use "CUSIP" numbers (if then generally in use), and, if so, the
Agent shall use "CUSIP" numbers in notices of redemption as a convenience to
Holders; provided that any such notice may state that no representation is made
as to the correctness of such numbers either as printed on the Securities or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
The Company will promptly notify the Agent of any changes in the "CUSIP"
numbers.
ARTICLE IV
The Notes and the Applicable Ownership Interest of the Treasury Portfolio
-------------------------------------------------------------------------
SECTION 4.1. Interest and Other Payments; Rights to Payments
-----------------------------------------------
Preserved; Distribution Rate Reset; Notice. Interest on any Note or
-------------------------------------------
distributions on the appropriate 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 Corporate
Units Certificate (or one or more Predecessor Corporate Units Certificates) of
which such Note or the appropriate Applicable Ownership Interest of 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.
Each Corporate Units Certificate evidencing Notes or the
Applicable Ownership Interest of the Treasury Portfolio delivered under this
Agreement upon registration of transfer of or in exchange for or in lieu of any
other Corporate Units Certificate shall carry the rights to interest or
distributions (as applicable) accrued and unpaid, and interest, distributions or
other payments to accrue, which were or will be carried by the Notes or the
Applicable Ownership Interest in the Treasury Portfolio underlying such other
Corporate Units Certificate.
In the case of any Corporate Units with respect to which Cash
Settlement of the underlying Purchase Contract is properly effected prior to
11:00 a.m., New York City time on the Business Day immediately preceding the
Purchase Contract Settlement Date pursuant to prior notice, or with respect to
which Early Settlement of the underlying Purchase Contract is properly effected
on an Early Settlement Date, or with respect to which a Collateral Substitution
is properly effected, in each case on a date that is after any Record Date and
on or prior to the next succeeding Payment Date, interest on the Notes or
distributions on the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, underlying such Corporate Units otherwise payable
on such Payment Date shall be payable on such Payment Date notwithstanding such
Cash Settlement or Early Settlement or Collateral Substitution, and such
interest or distributions shall, subject to receipt thereof by the Agent, be
payable to the Person in whose name the Corporate Units Certificate (or one or
more Predecessor 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 Corporate Units with
respect to which Cash Settlement or Early Settlement of the underlying Purchase
Contract is effected on the Business Day immediately preceding the Purchase
Contract Settlement Date or an Early Settlement Date, as the case may be, or
with respect to which a Collateral Substitution has been effected, interest or
distributions on the related Notes or on the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, that would otherwise be
payable after the Purchase Contract Settlement Date or Early Settlement Date
shall not be payable hereunder to the Holder of such Corporate Units; provided,
however, that to the extent that such Holder continues to hold the separated
Notes that formerly comprised a part of such Holder's Corporate Units, such
Holder shall be entitled to receive interest on such separated Notes.
The applicable Coupon Rate on the Notes will be reset on the
Reset Date to the applicable Reset Rate (such Reset Rate to be in effect on and
after the applicable Reset Effective Date). In the event of a Failed Final
Remarketing, the Coupon Rate on the Notes outstanding on and after the Purchase
Contract Settlement Date shall not be reset. On the applicable Reset
Announcement Date the Reset Spread and the Applicable Benchmark Treasury to be
used to determine the Reset Rate shall be announced by the Company or Sprint
Capital. On the Business Day immediately following the Reset Announcement Date,
the Notes Holders shall be notified of such Reset Spread and Applicable
Benchmark Treasury by the Company or Sprint Capital. Such notice shall be
sufficiently given to Holders of Notes if published in an Authorized Newspaper.
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 Notes pledged with the Collateral Agent 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 Corporate 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 Notes underlying their
Corporate Units and (c) stating the manner in which such instructions may be
given. Upon the written request of the Holders of Corporate 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 Notes as to which any particular voting instructions are
received. In the absence of specific instructions from the Holder of a Corporate
Unit, the Agent shall abstain from voting the Notes underlying such Corporate
Units. The Company hereby agrees, if applicable, to solicit Holders of Corporate
Units to timely instruct the Agent in order to enable the Agent to vote such
Notes.
SECTION 4.3. Tax Event Redemption. Upon the occurrence of a
---------------------
Tax Event Redemption prior to August 17, 2004 or any earlier Successful
Remarketing, pursuant to the terms of the Pledge Agreement, the Collateral Agent
will apply, out of the aggregate Redemption Price for the Notes that are
components of Corporate Units, an amount equal to the aggregate Redemption
Amount for the Notes that are components of Corporate Units to purchase on
behalf of the Holders of Corporate Units the Treasury Portfolio and promptly
remit the remaining portion of such Redemption Price to the Agent for payment to
the Holders of such Corporate Units. The Treasury Portfolio will be substituted
for the pledged Notes, and will be held by the Collateral Agent in accordance
with the terms of the Pledge Agreement to secure the obligation of each Holder
of a Corporate Unit to purchase the PCS Common Stock of the Company under the
Purchase Contract constituting a part of such Corporate Units. Following the
occurrence of a Tax Event Redemption prior to August 17, 2004 or any earlier
Successful Remarketing, the Holders of Corporate Units and the Collateral Agent
shall have such security interests, rights and obligations with respect to the
Treasury Portfolio as the Holder of Corporate Units and the Collateral Agent had
in respect of the Notes, as the case may be, subject to the Pledge thereof as
provided in 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 Corporate Units
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.
SECTION 4.4. CUSIP Numbers. The Company in issuing the Notes
--------------
may use "CUSIP" numbers (if then generally in use), and, if so, the Indenture
Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to
Holders; provided that any such notice may state that no representation is made
as to the correctness of such numbers either as printed on the Notes or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers
printed on the Notes, and any such redemption shall not be affected by any
defect in or omission of such numbers. The Company will promptly notify the
Indenture Trustee and the Agent of any changes in the "CUSIP" numbers.
ARTICLE V
The Purchase Contracts
----------------------
SECTION 5.1. Purchase of Shares of PCS Common Stock. Each
---------------------------------------
Purchase Contract shall, unless a Termination Event or an Early Settlement has
occurred, obligate the Holder of the related Security to purchase, and the
Company to sell, on the Purchase Contract Settlement Date at a price equal to
the Stated Amount (the "Purchase Price"), a number of shares of PCS Common Stock
equal to the Settlement Rate unless, on or prior to the Purchase Contract
Settlement Date, there shall have occurred a Termination Event with respect to
the Security of which such Purchase Contract is a part. The "Settlement Rate" is
equal to (a) if the Applicable Market Value is equal to or greater than $_____
(the "Threshold Appreciation Price"), _____ shares of PCS Common Stock per
Purchase Contract, (b) if the Applicable Market Value is less than the Threshold
Appreciation Price but is greater than $______, the number of shares of PCS
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 $_______, _______ shares of PCS 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 5.10, no fractional shares of PCS Common Stock will be issued upon
settlement of Purchase Contracts.
No fractional shares of PCS Common Stock will be issued by the
Company with respect to the payment of Contract Adjustment Payments on the
Purchase Contract Settlement 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.
Each Holder of a Corporate Unit or a Treasury Unit, by its
acceptance thereof, (a) 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), (b) agrees
to be bound by the terms and provisions thereof, (c) covenants and agrees to
perform its obligations under such Purchase Contracts, (d) 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 (f) consents to and agrees to be bound by the Pledge of the
Notes, 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 Security under the Purchase Contract may be enforced without regard to any
other rights or obligations. Each Holder of a Corporate Unit or Treasury Unit,
by its acceptance thereof, further covenants and agrees, that, to the extent and
in the manner provided in Section 5.6 and the Pledge Agreement, but subject to
the terms thereof, Proceeds of the Treasury Securities, the Notes or the
Treasury Portfolio, as applicable, on the Purchase Contract Settlement Date
shall be paid 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 Proceeds.
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. (i) Subject to
-----------------------------
Section 5.4 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 Corporate Units Register
or the Treasury Units Register or by wire transfer to the account designated by
a prior written notice by such Person.
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.
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 Corporate 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.
Subject to Section 5.11, in the case of any Security with
respect to which Early Settlement of the underlying Purchase Contract is
effected on an Early Settlement Date, or in respect of which Cash Settlement of
the underlying Purchase Contract is effected on the Business Day immediately
preceding the Purchase Contract Settlement Date, or with respect to which a
Collateral Substitution or an establishment or re-establishment of a Corporate
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 Contracts underlying such Securities
otherwise payable on such Payment Date shall be payable on such Payment Date
notwithstanding such Cash Settlement, Early Settlement, Collateral Substitution
or establishment or re-establishment of Corporate Units, and such Contract
Adjustment Payments shall be paid to the Person in whose name the Certificate
evidencing such
Security (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 Security with respect to
which Cash Settlement or Early Settlement of the underlying Purchase Contract is
effected on the Business Day immediately preceding the Purchase Contract
Settlement Date or on an Early Settlement Date, as the case may be, or with
respect to which a Collateral Substitution or an establishment or
re-establishment of a Corporate Unit has been effected, Contract Adjustment
Payments, if any, that would otherwise be payable after the Early Settlement
Date, Collateral Substitution or such establishment or re-establishment with
respect to such Purchase Contract shall not be payable.
Section 5.3. Subordination of Contract Adjustment Payments.
---------------------------------------------
(a) The Company's obligations with respect to Contract Adjustment Payments, if
any, will be subordinated and junior in right of payment to the Company's
obligations under any Senior Indebtedness.
(b) In the event (i) of any payment by, or distribution of
assets of, the Company of any kind or character, whether in cash, property or
securities, to creditors upon any dissolution, winding-up, liquidation or
reorganization of the Company, whether voluntary or involuntary or in
bankruptcy, insolvency, receivership or other proceedings, or (ii) subject to
the provisions of this Section 5.3, that (1) a default shall have occurred and
be continuing with respect to the payment of principal, interest or any other
monetary amounts due and payable on any Senior Indebtedness and such default
shall have continued beyond the period of grace, if any, specified in the
instrument evidencing such Senior Indebtedness (and the Agent shall have
received written notice thereof from the Company or one or more holders of
Senior Indebtedness or their representative or representatives or the trustee or
trustees under any indenture pursuant to which any such Senior Indebtedness may
have been issued), or (2) the maturity of any Senior Indebtedness shall have
been accelerated because of a default in respect of such Senior Indebtedness
(and the Agent shall have received written notice thereof from the Company or
one or more holders of Senior Indebtedness or their representative or
representatives or the trustee or trustees under any indenture pursuant to which
any such Senior Indebtedness may have been issued), then:
(A) the holders of all Senior Indebtedness shall first be
entitled to receive, in the case of clause (i) above, payment of all
amounts due or to become due upon all Senior Indebtedness and, in the
case of subclauses (1) and (2) of clause (ii) above, payment of all
amounts due thereon, or provision shall be made for such payment in
money or money's worth, before the Holders of any of the Securities are
entitled to receive any Contract Adjustment Payments on the Purchase
Contracts underlying the Securities;
(B) any payment by, or distribution of assets of, the Company
of any kind or character, whether in cash, property or securities, to
which the Holders of any of the Securities would be entitled except for
the provisions of this Section 5.3, including any such payment or
distribution which may be payable or deliverable by reason of the
payment of any other indebtedness of the Company being subordinated to
the payment of such Contract Adjustment Payments on the Purchase
Contracts underlying the Securities, shall be paid or delivered by the
Person making such payment or distribution, whether a trustee in
bankruptcy, a receiver or liquidating trustee or otherwise, directly to
the holders of such Senior Indebtedness or their representative or
representatives or to the trustee or trustees under any indenture under
which any instruments evidencing any of such Senior Indebtedness may
have been issued, ratably according to the aggregate amounts remaining
unpaid on account of such Senior Indebtedness held or represented by
each, to the extent necessary to make payment in full of all Senior
Indebtedness remaining unpaid after giving effect to any concurrent
payment or distribution (or provision therefor) to the holders of such
Senior Indebtedness, before any payment or distribution is made of such
Contract Adjustment Payments to the Holders of such Securities; and
(C) in the event that, notwithstanding the foregoing, any
payment by, or distribution of assets
of, the Company of any kind or character, whether in cash, property or
securities, including any such payment or distribution which may be
payable or deliverable by reason of the payment of any other
indebtedness of the Company being subordinated to the payment of
Contract Adjustment Payments on the Purchase Contracts underlying the
Securities, shall be received by the Agent or the Holders of any of the
Securities when such payment or distribution is prohibited pursuant to
this Section 5.3, such payment or distribution shall be paid over to
the holders of such Senior Indebtedness or their representative or
representatives or to the trustee or trustees under any indenture
pursuant to which any instruments evidencing any such Senior
Indebtedness may have been issued, ratably as aforesaid, for
application to the payment of all Senior Indebtedness remaining unpaid
until all such Senior Indebtedness shall have been paid in full, after
giving effect to any concurrent payment or distribution (or provision
therefor) to the holders of such Senior Indebtedness.
(c) For purposes of this Section 5.3, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other Person
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in this Section 5.3, with
respect to such Contract Adjustment Payments on the Securities to the payment of
all Senior Indebtedness which may at the time be outstanding; provided that (A)
the indebtedness or guarantee of indebtedness, as the case may be, that
constitutes Senior Indebtedness is assumed by the Person, if any, resulting from
any such reorganization or readjustment, and (B) the rights of the holders of
the Senior Indebtedness are not, without the consent of each such holder
adversely affected thereby, altered by such reorganization or readjustment.
(d) Any failure by the Company to make any payment on or perform any
other obligation under Senior Indebtedness, other than any indebtedness incurred
by the Company or assumed or guaranteed, directly or indirectly, by the Company
for money borrowed (or any deferral, renewal,
extension or refunding thereof) or any indebtedness or obligation as to which
the provisions of this Section 5.3, shall have been waived by the Company in the
instrument or instruments by which the Company incurred, assumed, guaranteed or
otherwise created such indebtedness or obligation, shall not be deemed a default
or event of default if (A) the Company shall be disputing its obligation to make
such payment or perform such obligation and (B) either (x) no final judgment
relating to such dispute shall have been issued against the Company which is in
full force and effect and is not subject to further review, including a judgment
that has become final by reason of the expiration of the time within which a
party may seek further appeal or review, and (y) in the event a judgment that is
subject to further review or appeal has been issued, the Company shall in good
faith be prosecuting an appeal or other proceeding for review and a stay of
execution shall have been obtained pending such appeal or review.
(e) Subject to the payment in full of all Senior Indebtedness, the
Holders of the Securities shall be subrogated (equally and ratably with the
holders of all obligations of the Company which by their express terms are
subordinated to Senior Indebtedness of the Company to the same extent as payment
of the Contract Adjustment Payments in respect of the Purchase Contracts
underlying the Securities is subordinated and which are entitled to like rights
of subrogation) to the rights of the holders of Senior Indebtedness to receive
payments or distributions of cash, property or securities of the Company
applicable to the Senior Indebtedness until all such Contract Adjustment
Payments owing on the Securities shall be paid in full, and as between the
Company, its creditors other than holders of such Senior Indebtedness and the
Holders, no such payment or distribution made to the holders of Senior
Indebtedness by virtue of this Section 5.3 that otherwise would have been made
to the Holders shall be deemed to be a payment by the Company on account of such
Senior Indebtedness, it being understood that the provisions of this Section 5.3
are intended solely for the purpose of defining the relative rights of the
Holders, on the one hand, and the holders of Senior Indebtedness, on the other
hand.
(f) Nothing contained in this Section 5.3 or elsewhere in this
Agreement or in the Securities is intended to or shall impair, as among the
Company, its creditors other than the holders of Senior Indebtedness and the
Holders, the obligation of the Company, which is absolute and unconditional, to
pay to the Holders such Contract Adjustment Payments on the Securities as and
when the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders and creditors of
the Company other than the holders of Senior Indebtedness, nor shall anything
herein or therein prevent the Agent or any Holder from exercising all remedies
otherwise permitted by applicable law upon default under this Agreement, subject
to the rights, if any, under this Section 5.3, of the holders of Senior
Indebtedness in respect of cash, property or securities of the Company received
upon the exercise of any such remedy.
(g) Upon payment or distribution of assets of the Company referred to
in this Section 5.3, the Agent and the Holders shall be entitled to rely upon
any order or decree made by any court of competent jurisdiction in which any
such dissolution, winding up, liquidation or reorganization proceeding affecting
the affairs of the Company is pending or upon a certificate of the trustee in
bankruptcy, receiver, assignee for the benefit of creditors, liquidating trustee
or agent or other person making any payment or distribution, delivered to the
Agent or to the Holders, for the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Section 5.3.
(h) The Agent shall be entitled to rely on the delivery to it of a
written notice by a Person representing himself to be a holder of Senior
Indebtedness (or a trustee or representative on behalf of such holder) to
establish that such notice has been given by a holder of Senior Indebtedness or
a trustee or representative on behalf of any such holder or holders. In the
event that the Agent determines in good faith that further evidence is required
with respect to the right of any Person as a holder of Senior Indebtedness to
participate in any payment or distribution pursuant to this Section 5.3, the
Agent may request such Person to furnish evidence to the reasonable satisfaction
of the Agent as to the amount of Senior Indebtedness held by such Person, the
extent to which such Person is entitled to participate in such payment or
distribution and any other facts pertinent to the rights of such Person under
this Section 5.3, and, if such evidence is not furnished, the Agent may defer
payment to such Person pending judicial determination as to the right of such
Person to receive such payment.
(i) Nothing contained in this Section 5.3 shall affect the obligations
of the Company to make, or prevent the Company from making, payment of the
Contract Adjustment Payments, except as otherwise provided in this Section 5.3.
(j) Each Holder of Securities, by his acceptance thereof, authorizes
and directs the Agent on his, her or its behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in this
Section 5.3 and appoints the Agent his, her or its attorney-in-fact, as the case
may be, for any and all such purposes.
(k) The Company shall give prompt written notice to the Agent of any
fact known to the Company that would prohibit the making of any payment of
moneys to or by the Agent in respect of the Securities pursuant to the
provisions of this Section. Notwithstanding the provisions of this Section 5.3
or any other provisions of this Agreement, the Agent shall not be charged with
knowledge of the existence of any facts that would prohibit the making of any
payment of moneys to or by the Agent, or the taking of any other action by the
Agent, unless and until the Agent shall have received written notice thereof
mailed or delivered to a Responsible Officer of the Agent from the Company, any
Holder, any paying agent or the holder or representative of any Senior
Indebtedness; provided that if at least two Business Days prior to the date upon
which by the terms hereof any such moneys may become payable for any purpose,
the Agent shall not have received with respect to such moneys the notice
provided for in this Section, then, anything herein contained to the contrary
notwithstanding,
the Agent shall have full power and authority to receive such moneys and to
apply the same to the purpose for which they were received and shall not be
affected by any notice to the contrary that may be received by it within two
Business Days prior to or on or after such date.
(l) The Agent in its individual capacity shall be entitled to all the
rights set forth in this Section with respect to any Senior Indebtedness at the
time held by it, to the same extent as any other holder of Senior Indebtedness
and nothing in this Agreement shall deprive the Agent of any of its rights as
such holder.
(m) No right of any present or future holder of any Senior Indebtedness
to enforce the subordination herein shall at any time or in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any noncompliance by the Company with the terms, provisions and covenants
of this Agreement, regardless of any knowledge thereof which any such holder may
have or be otherwise charged with.
(n) Nothing in this Section 5.3 shall apply to claims of, or payments
to, the Agent under or pursuant to Section 7.07.
With respect to the holders of Senior Indebtedness, (A) the duties
and obligations of the Agent shall be determined solely by the express
provisions of this Agreement; (B) the Agent shall not be liable except for the
performance of such duties and obligations as are specifically set forth in this
Agreement; (C) no implied covenants or obligations shall be read into this
Agreement against the Agent; and (D) the Agent shall not be deemed to be a
fiduciary as to such holders.
Section 5.4. Deferral of Contract Adjustment Payments.
----------------------------------------
(a) The Company shall have the right, at any time prior to the Purchase
Contract Settlement 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, if less than the
entire amount payable) at least 10 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 the NYSE or other applicable self-regulatory
organization or to Holders of the Securities, 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 [ ]% 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. 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 Purchase Contract Settlement 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 Purchase
Contract Settlement Date, each Holder will receive on the Purchase Contract
Settlement Date in lieu of a cash payment a number of shares of PCS Common Stock
(in addition to a number of shares of PCS 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 PCS Common Stock will be issued by the
Company with respect to the payment of Deferred Contract Adjustment Payments on
the Purchase Contract Settlement 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
5.10.
(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 series of PCS Common Stock other than:
(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 any series of PCS
Common Stock or the exchange or conversion of one series of PCS Common
Stock for another series of PCS Common Stock;
(iii) the purchase of fractional interests in any series of
PCS Common Stock pursuant to the conversion or exchange provisions of
such series of PCS Common Stock or the security being converted or
exchanged;
(iv) dividends or distributions in any series of PCS Common
Stock (or rights to acquire capital stock) or repurchases, acquisitions
or redemptions of any
series of PCS Common Stock in exchange for or out of the net cash
proceeds of the sale of any series of PCS Common Stock (or securities
convertible into or exchangeable for shares of any series of PCS Common
Stock);
(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; or
(F) redemptions of PCS Common Stock pursuant to Section 7.1 or
Article Sixth of the Company's articles of incorporation or any
successor provision.
SECTION 5.5. Initial and Subsequent Remarketing. (a) Unless a
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Tax Event Redemption has occurred or the Company exercises its right to defer
remarketing pursuant to Section 5.5(c), the Company shall engage the Remarketing
Agent pursuant to the Remarketing Agreement to sell the Notes of Corporate Unit
Holders (and other Note Holders that duly elect pursuant to the Remarketing
Agreement to have their Notes remarketed) (the "Initial Remarketing") on the
third Business Day immediately preceding May 17, 2004 (the "Initial Remarketing
Date"). In the event the Initial Remarketing is a Failed Remarketing or has been
deferred by the Company pursuant to Section 5.5(c), unless a Tax Event
Redemption has occurred, upon request from the Company and Sprint Capital, the
Remarketing Agent shall use its reasonable efforts from time to time prior to
the twelfth Business Day before August 17, 2004 or in any case on the third
business day immediately prior to the date of any PCS Stock Redemption to
remarket all of the Notes of Corporate Unit Holders who have not otherwise
notified the Agent on or prior to the second business day before any Subsequent
Remarketing of their intention to make an Early Settlement of the related
Purchase Contracts (each such subsequent remarketing being referred to as a
"Subsequent Remarketing" and each date on which a Subsequent Remarketing takes
place being referred to as a "Subsequent Remarketing Date"). In order to
facilitate the remarketing, the Agent shall notify, by 10:00 a.m., New York City
time, on the Business Day immediately preceding the Initial Remarketing Date or
any Subsequent Remarketing Date, the Remarketing Agent of
the aggregate principal amount of Notes to be remarketed. Concurrently, the
Collateral Agent, pursuant to the terms of the Pledge Agreement, will present
such Notes to the Remarketing Agent for remarketing. Upon receipt of such notice
from the Agent and such Notes from the Collateral Agent, the Remarketing Agent
will, on the Initial Remarketing Date or any Subsequent Remarketing Date, use
its reasonable efforts to remarket such Notes on such date at an aggregate price
of approximately 100.5% (but not less than 100%) of the Treasury Portfolio
Purchase Price. If the Remarketing Agent is able to remarket the Notes at a
price equal to or greater than 100% of the Treasury Portfolio Purchase Price (a
"Successful Initial Remarketing" or "Successful Subsequent Remarketing", as
applicable), the portion of the proceeds from such Successful Initial
Remarketing or Successful Subsequent Remarketing equal to the Treasury Portfolio
Purchase Price will be applied to purchase the Treasury Portfolio. In addition,
the Remarketing Agent may deduct as a remarketing fee ("Remarketing Fee") an
amount not exceeding 25 basis points (0.25%) of the Treasury Portfolio Purchase
Price from any amount of such proceeds in excess of the Treasury Portfolio
Purchase Price. Any proceeds in excess of those required to pay the Treasury
Portfolio Purchase Price and the Remarketing Fee will be remitted to the Agent
for payment to the Holders of the related Corporate Units. Holders of Corporate
Units whose Notes are so remarketed shall not otherwise be responsible for the
payment of any Remarketing Fee in connection therewith. The Treasury Portfolio
shall be substituted for the Notes of Corporate Unit Holders and shall be
pledged to the Collateral Agent to secure the Corporate Unit Holders' obligation
to pay the Purchase Price for the PCS Common Stock under the related Purchase
Contracts on the Purchase Contract Settlement Date. Following the occurrence of
a Successful Initial Remarketing or Successful Subsequent Remarketing, the
Holders of Corporate Units and the Collateral Agent shall have such security
interests, rights and obligations with respect to the Treasury Portfolio as the
Holder of Corporate Units and the Collateral Agent had in respect of the Notes,
as the case may be, subject to the Pledge thereof as provided in 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 Corporate Units
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.
(b) If, on the Initial Remarketing Date or any Subsequent
Remarketing Date, the Remarketing Agent (despite using its reasonable efforts)
cannot remarket the related Notes (other than to the Company or Sprint Capital)
of such Holders of Corporate Units at a price not less than 100% of the Treasury
Portfolio Purchase Price or a condition precedent to the remarketing set forth
in the Remarketing Agreement has not been satisfied, the remarketing will be
deemed to have failed (a "Failed Remarketing"). The Company will cause a notice
of a Failed Remarketing to be published on the Business Day immediately
following the Failed Remarketing in an Authorized Newspaper.
(c) Notwithstanding the foregoing, any obligation on the part
of the Company, Sprint Capital or the Remarketing Agent to remarket the Notes on
the Initial Remarketing Date or otherwise, other than the Final Remarketing Date
or upon any PCS Stock Redemption, shall be subject to the Company's or Sprint
Capital's right to defer any remarketing to the extent the Company determines in
good faith that effecting a remarketing on such date is not in its best
interests.
(d) Not later than 7 calendar days nor more than 15 calendar
days prior to any Reset Announcement Date, the Company or Sprint Capital will
notify the DTC or its nominee (or any successor Clearing Agency or its nominee)
by first-class mail, postage prepaid, to notify the Beneficial Owners or
Clearing Agency Participants holding Corporate Units or Treasury Units of such
Reset Announcement Date and, in the case of a Final Remarketing, the procedures
to be followed by Holders of Corporate Units who intend to settle their
obligation under the Purchase Contract with separate cash on the Purchase
Contract Settlement Date.
SECTION 5.6. Payment of Purchase Price; Final Remarketing. (a)
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(i) Unless a Tax Event Redemption, Successful Remarketing, Termination Event or
Early Settlement has occurred, each Holder of a Corporate Unit may pay in cash
("Cash Settlement") the Purchase Price for the shares of PCS 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 fifth Business Day immediately preceding the Purchase
Contract Settlement 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.
(ii) A Holder of a Corporate 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 Purchase
Contract Settlement Date in lawful money of the United States by
certified or cashiers' check or wire transfer, in each case in
immediately available funds payable to or upon the order of the
Company. Any cash received by the Collateral Agent will be invested
promptly by the Collateral Agent in Permitted Investments and paid to
the Company on the Purchase Contract Settlement Date in settlement of
the Purchase Contract in accordance with the terms of this Agreement
and the Pledge Agreement. Any funds received by the Collateral Agent in
respect of the investment earnings from the investment in such
Permitted Investments, will be distributed to the Agent when received
for payment to the Holder.
(iii) If a Holder of a Corporate 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 Final Remarketing as
described in paragraph (b) below. If a Holder of a Corporate Unit 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)(ii) 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
paragraph (c) below.
(b) Unless a Tax Event Redemption or an earlier Successful
Remarketing has occurred, the Notes of Corporate Unit Holders who have not
notified the Agent of their intention to effect a Cash Settlement as provided in
paragraph (a)(i) above will be sold by the Remarketing Agent (the "Final
Remarketing") on the third Business Day immediately preceding the Purchase
Contract Settlement Date (the "Final Remarketing Date"). The Agent shall notify,
by 10:00 a.m., New York City time, on the Business Day immediately preceding the
Final Remarketing Date, the Remarketing Agent of the aggregate principal amount
of Notes to be remarketed. Concurrently, the Collateral Agent, pursuant to the
terms of the Pledge Agreement, shall present for remarketing such Notes to the
Remarketing Agent. Upon receipt of such notice from the Agent and such Notes
from the Collateral Agent, the Remarketing Agent shall, on the Final Remarketing
Date, use its reasonable efforts to remarket such Notes on such date at a price
of approximately 100.5% (but not less than 100%) of the aggregate principal
amount of such Notes.
If the Remarketing Agent is able to remarket the Notes at a
price equal to or greater than 100% of the aggregate principal amount of Notes
(a "Successful Final Remarketing"), the Remarketing Agent will remit the entire
amount of the proceeds from such Successful Final Remarketing to the Collateral
Agent; provided, however, that the Remarketing Agent may deduct as the
Remarketing Fee an amount not exceeding 25 basis points (0.25%) of the aggregate
principal amount of the remarketed Notes from any amount of the proceeds of a
Successful Final Remarketing in excess of the aggregate principal amount of the
remarketed Notes. The portion of the proceeds equal to the aggregate principal
amount of Notes will automatically be applied by the Collateral Agent, in
accordance with the Pledge Agreement, to satisfy in full such Corporate Units
holders' obligations to pay the Purchase Price for the PCS Common
Stock under the related Purchase Contracts on the Purchase Contract Settlement
Date. Any proceeds in excess of those required to pay the Purchase Price and the
Remarketing Fee will be remitted to the Agent for payment to the Holders of the
related Corporate Units. Corporate Units Holders whose Notes are so remarketed
will not otherwise be responsible for the payment of any Remarketing Fee in
connection therewith. If, on the Final Remarketing Date, the Remarketing Agent
(despite using its reasonable efforts) cannot remarket the related Notes (other
than to the Company or Sprint Capital) of such Holders of Corporate Units at a
price not less than 100% of the aggregate principal amount of the Notes or a
condition precedent to the Final Remarketing set forth in the Remarketing
Agreement has not been satisfied, the remarketing will be deemed to have failed
(a "Failed Final Remarketing") and, in accordance with the terms of the Pledge
Agreement, the Collateral Agent for the benefit of the Company shall exercise
its rights as a secured party with respect to such Notes, including those
actions specified in paragraph (c) below. The Company shall cause a notice of
such Failed Final Remarketing to be published on the second Business Day
immediately preceding the Purchase Contract Settlement Date in an Authorized
Newspaper.
(c) With respect to any Notes beneficially owned by Holders
who have elected Cash Settlement but failed to deliver cash as required in
(a)(ii) above, or with respect to Notes which were included in a Failed Final
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 paragraph (h) below, may, among other things, (i) retain the Notes in
full satisfaction of the Holders obligations under the Purchase Contracts or
(ii) sell the Notes in one or more public or private sales.
(d) Unless a Termination Event or an Early Settlement has
occurred, the Purchase Contract underlying each Treasury Unit and, if a Tax
Event Redemption or a Successful Initial Remarketing or Successful Subsequent
Remarketing has occurred, each Corporate Unit will be settled with the Proceeds
at maturity of the Treasury Security or the Applicable Ownership Interest (as
defined in clause (A) of the definition of such term) of the
Treasury Portfolio, as applicable. Upon receipt of such Proceeds, the Collateral
Agent will invest the Proceeds promptly in Permitted Investments and pay the
Proceeds to the Company on the Purchase Contract Settlement Date in accordance
with the terms of this Agreement and the Pledge Agreement. Any such Proceeds
received by the Collateral Agent in excess of the Purchase Price and any funds
received by the Collateral Agent in respect of the investment earnings from the
investment in such Permitted Investments will be distributed to the Agent when
received for payment to the Holder.
(e) Any distribution to Holders of excess funds and interest
described above, shall be payable at the New York Office maintained for that
purpose or, at the option of the Holder, by check mailed to the address of the
Person entitled thereto at such address as it appears on the Register.
(f) Unless a Holder settles the underlying Purchase Contract
through the Early Settlement in the manner described in Section 5.11, the
Company shall not be obligated to issue any shares of PCS Common Stock in
respect of a Purchase Contract or deliver any certificate therefor to the Holder
unless it shall have received payment in full of the Purchase Price for the
shares of Common Stock to be purchased thereunder in the manner set forth in
this Section 5.6.
(g) Upon Cash Settlement of any Purchase Contract, (i) the
Collateral Agent will in accordance with the terms of the Pledge Agreement cause
the pledged Notes underlying the relevant Security to be released from the
Pledge by the Collateral Agent free and clear of any security interest of the
Company and transferred to the Agent for delivery to the Holder thereof or its
designee as soon as practicable and (ii) subject to the receipt thereof from the
Collateral Agent, the Agent shall, by book-entry transfer, or other appropriate
procedures, in accordance with instructions provided by the Holder thereof,
transfer such Notes (or, if no such instructions are given to the Agent by the
Holder, the Agent shall hold such Notes and any distributions thereon in the
name of the Agent or its nominee in trust for the benefit of such Holder).
(h) The obligations of the Holders to pay the Purchase Price
are non-recourse obligations and are payable solely out of any Cash Settlement
or 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 the
Proceeds of Collateral and the Purchase Price.
SECTION 5.7. Issuance of Shares of PCS Common Stock. Unless a
---------------------------------------
Termination Event or an Early Settlement shall have occurred, on the Purchase
Contract Settlement Date, upon its receipt of payment in full of the Purchase
Price for the shares of PCS Common Stock purchased by the Holders pursuant to
the foregoing provisions of this Article and subject to Section 5.8(c), the
Company shall issue and deposit with the Agent, for the benefit of the Holders
of the Outstanding Securities, one or more certificates representing shares of
PCS Common Stock registered in the name of the Agent (or its nominee) as
custodian for the Holders (such certificates for shares of PCS Common Stock,
together with any dividends or distributions for which both a record date and
payment date for such dividend or distribution has occurred on or after the
Purchase Contract Settlement 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 Purchase Contract Settlement 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 PCS Common Stock which such Holder
is entitled to receive pursuant to the provisions of this Article Five (after
taking into account all Securities 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 canceled. 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 PCS 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 the
Certificate evidencing such Purchase Contract or has established to the
satisfaction of the Company that such tax either has been paid or is not
payable.
SECTION 5.8. Adjustment of Settlement Rate. (a) Adjustments
------------------------------
for Dividends, Distributions, Stock Splits, Etc (for purposes of paragraphs
(1)-(10) of this Section 5.8(a), the outstanding shares of PCS Common Stock
shall include shares issuable in respect of Class A Common Stock):
(1) In case the Company shall pay or make a dividend in PCS
Common Stock or other distribution on the PCS Common Stock in PCS
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, the
numerator of which shall be the number of shares of PCS Common Stock
outstanding at the close of business on the date fixed for such
determination and the denominator of which 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 PCS 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 PCS Common Stock. If, after any such
date fixed for determination, any dividend or distribution is not in
fact paid, the Settlement Rate shall be immediately readjusted,
effective as of the date the Board of Directors determines not to pay
such dividend or distribution, to the Settlement Rate that would have
been effect if such determination date had not been fixed. The Company
will not pay any dividend or make any
distribution on shares of PCS Common Stock held in the treasury of the
Company unless the shares held in treasury represent an intergroup
interest in accordance with generally accepted accounting principles.
(2) In case the Company shall issue rights, options or
warrants to all holders of its PCS Common Stock (not being available on
an equivalent basis to Holders of the Securities upon settlement of the
Purchase Contracts underlying such Securities) entitling them, for a
period expiring within 45 days after the record date for the
determination of stockholders entitled to receive such rights, options
or warrants, to subscribe for or purchase shares of PCS Common Stock at
a price per share less than the Current Market Price per share of the
PCS 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 plan or share purchase
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 PCS Common Stock outstanding at the
close of business on the date fixed for such determination plus the
number of shares of PCS Common Stock which the aggregate offering price
of the total number of shares of PCS 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 PCS
Common Stock outstanding at the close of business on the date fixed for
such determination plus the number of shares of PCS 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 shares of PCS 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 PCS Common Stock. The Company
shall not issue any such rights, options or warrants in respect of
shares of PCS Common Stock held in the treasury of the Company, unless
the shares held in treasury represent an intergroup interest in
accordance with generally accepted accounting principles. Upon the
expiration of any such rights, options or warrants without being
exercised, the Settlement Rate shall again immediately be adjusted such
that the numerator and denominator used in the prior adjustment
pursuant to this Section 5.8(a)(2) only gives effect to the number of
shares of PCS Common Stock actually purchased upon expiration of such
45-day period (and the related aggregate offering price of such
shares).
(3) In case outstanding shares of PCS Common Stock shall be
subdivided or split into a greater number of shares of PCS 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 PCS Common Stock shall each be combined into a
smaller number of shares of PCS 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) In case the Company shall, by dividend or otherwise,
distribute to all holders of its PCS Common Stock evidences of its
indebtedness, shares of capital stock, securities, cash or other
property (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 or distribution referred to in paragraph (1) of
this Section), 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
the determination of stockholders entitled to receive
such distribution by a fraction of which the numerator shall be the
Current Market Price per share of the PCS 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) on
such date of the portion of the evidences of indebtedness, shares of
capital stock, securities, cash or other property so distributed
applicable to one share of PCS Common Stock and the denominator shall
be such Current Market Price per share of the PCS 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.
(5) In case the Company shall, by dividend or otherwise,
distribute cash to all holders of its PCS Common Stock (excluding (x)
any cash that is distributed in a Reorganization Event to which Section
5.8(c) applies or (y) cash that is distributed as part of a
distribution referred to in paragraph (4) of this Section (such
distributions, other than regularly quarterly dividends, the
"Triggering Distribution"), in an aggregate amount that, combined
together with:
(I) the aggregate amount of any other distributions (such
distributions, other than regularly quarterly dividends the "Prior Cash
Distributions") made exclusively in cash to all holders of its PCS
Common Stock within the 12 months before the date of payment of the
Triggering Distribution for which no adjustment pursuant to this
paragraph (5) has been made; and
(II) the aggregate of any cash plus the fair market value, as
of the expiration of the applicable 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 filed with the
Agent), of consideration payable in respect of any tender or
exchange offer (other than consideration payable in respect of any
odd-lot tender offer) by the Company or any of its Subsidiaries (each,
a "Prior Company Tender") for all or any portion of the PCS Common
Stock concluded within the 12 months before the date of payment of the
Triggering Distribution and for which no adjustment has been under this
paragraph (5) or paragraph (6);
exceeds 1% of the product of the Current Market Price per share of the
PCS Common Stock on the record date for the Triggering Distribution and
the number of shares of PCS Common Stock outstanding on that date,
then, immediately after the close of business on the record date for
the Triggering Distribution, the Settlement Rate shall be adjusted for
each Prior Cash Distribution, each Prior Company Tender, and the
Triggering Distribution, successively, in the order of their occurrence
as follows:
(X) with respect to each Prior Cash Distribution or the
Triggering Distribution, as the case may be, by multiplying the
Settlement Rate (either as in effect at such time or as adjusted with
respect to an earlier adjustment pursuant to this paragraph)
immediately before the distribution by a fraction, (A) the numerator of
which is the Current Market Price per share of the PCS Common Stock on
the record date for the distribution and (B) the denominator of which
is the Current Market Price per share of the PCS Common Stock on the
record date for the distribution less the amount of cash per share
distributed in the distribution, and
(Y) with respect to each Prior Company Tender, by multiplying
the Settlement Rate (either as in effect at such time or as adjusted
with respect to an earlier adjustment pursuant to this paragraph) at
the last time for which tenders could be accepted (the "Expiration
Date") by a fraction (i) the numerator of which is the product of (A)
the Current market Price per share of the PCS Common Stock at the
Expiration Time and (B) the number of shares of PCS Common Stock
outstanding immediately after completion of the Prior Company Tender
and (ii) the denominator of which is
(A) the product of (I) the Current Market Price per share of the PCS
Common Stock at at the Expiration Time and (II) the number of shares of
PCS Common Stock outstanding immediately before the Expiration Time
less (B) the total amount of consideration paid in the Prior Company
Tender for the shares of PCS Common Stock tendered.
(6) In case of a tender or exchange offer (other than an
odd-lot tender offer) made by the Company or any Subsidiary of the
Company for all or any portion of the PCS Common Stock (a "Triggering
Tender Offer") shall expire and such Triggering Tender 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 Triggering Tender Offer) of an aggregate consideration
having a faire market value (as determined by the Board of Directors,
whose determination shall be conclusive and described in a Board
Resolution filed with the Agent) that combined together with:
(I) 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 filed with the Agent),
as of the expiration of the Triggering Tender Offer, of consideration
payable in respect of any Prior Company Tender (other than
consideration payable in respect of any odd-lot tender offer) by the
Company or any Subsidiary of the Company (each for all or any portion
of the PCS Common Stock expiring within the 12 months preceding the
expiration of the Triggering Tender Offer and in respect of which no
adjustment pursuant to paragraph (5) of this paragraph (6) has been
made), and
(II) the aggregate amount of any Prior Cash Distributions made
exclusively in cash to all holders of its PCS Common Stock within the
12 months before expiration of the Triggering Tender Offer and in
respect of which no adjustment pursuant to paragraph (5) or this
paragraph (6) has been made.
exceeds 1% of the product of the Current Market Price per share of the
PCS Common Stock on the Expiration Date of the Triggering Tender Offer
and the number of shares of PCS Common Stock outstanding on that date,
then, immediately prior to the opening of business on the date after
the date of the Expiration Time, the Settlement Rate shall be adjusted
for each Prior Cash Distribution, each Prior Company Tender, and the
Triggering Tender Offer, successively, in the order of their occurrence
as follows:
(X) with respect to each Prior Cash Distribution, by
multiplying the Settlement Rate (either as in effect at such time or as
adjusted with respect to an earlier adjustment pursuant to this
paragraph) immediately before the distribution by a fraction, (A) the
numerator of which is the Current Market Price per share of the PCS
Common Stock on the record date for the distribution and (B) the
denominator of which is the Current Market Price per share of the PCS
Common Stock on the record date for the distribution less the amount of
cash per share distributed in the distribution, and
(Y) with respect to each Prior Company Tender or the
Triggering Tender Offer, by multiplying the Settlement Rate (either as
in effect at such time or as adjusted with respect to any earlier
adjustment pursuant to this paragraph) at the last time for which
tenders could be accepted (the "Expiration Date") by a fraction (i) the
numerator of which is the product of (A) the Current Market Price per
share of the PCS Common Stock at the Expiration Time and (B) the number
of shares of PCS Common Stock outstanding immediately after completion
of the Prior Company Tender and (ii) the denominator of which is (A)
the product of (I) the Current Market Price per share of the PCS Common
Stock at the Expiration Time and (II) the number of shares of PCS
Common Stock outstanding immediately before the Expiration Time less
(B) the total amount of consideration paid in the Prior Company Tender
for the shares of PCS Common Stock tendered.
(7) The "Current Market Price" per share of PCS Common Stock
on any day means the average of the daily Closing Prices for the five
consecutive Trading Days
selected by the Company commencing not more than 30 Trading Days
before, and ending not later than, the earlier of the day in question
and the day before the "ex date" with respect to the issuance or
distribution requiring such computation. 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 PCS Common
Stock trades regular way on such exchange or in such market without the
right to receive such issuance or distribution.
(8) All adjustments to the Settlement Rate, shall be
calculated to the nearest 1/10,000th of a share of PCS 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 shall be
required unless such adjustment would require an increase or decrease
of at least one percent therein; provided, however, 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) or (9) of this Section 5.8(a),
an adjustment shall also be made to the Applicable Market Value solely
to determine which of clauses (a), (b) or (c) of the definition of
Settlement Rate in Section 5.1 will apply on the Purchase Contract
Settlement Date. Such adjustment shall be made by multiplying the
Applicable Market Value by a fraction of which the numerator shall be
the Settlement Rate immediately after such adjustment pursuant to
paragraph (1), (2), (3), (4), (5), (6) or (9) of this Section 5.6(a)
and the denominator shall be the Settlement Rate immediately before
such adjustment; provided, however, 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),
(6) or (9) of this Section 5.8(a) during the period taken into
consideration for determining the Applicable Market Value, appropriate
and customary adjustments shall be made to the Settlement Rate.
(9) 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 PCS 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 Certain Recapitalization Transactions.
(1) If the Company completes an exchange offer,
recapitalization, reorganization or similar transaction (a
"Recapitalization Transaction") pursuant to which some, but not all, of
the shares of PCS Common Stock outstanding immediately prior to such
transaction are exchanged for or converted, changed or reclassified
into other Common Equity Securities, then thereafter each Holder of
Securities will receive on the Purchase Contract Settlement Date with
respect to each Purchase Contract forming a part thereof, at such
Holder's election, either (i) shares of PCS Common Stock at a
Settlement Rate equal to the Settlement Rate in effect immediately
prior to such Recapitalization Transaction as adjusted in accordance
with subsection (a) of this Section 5.8 (A) for any premium paid to
holders of PCS Common Stock in such Recapitalization Transaction other
than in the form of such other Common Equity Securities representing a
greater economic interest in the Company than the shares of PCS Common
Stock in respect of which such Common Equity Securities were issued
(but without adjustment for any such premium paid in the form of such
other Common Equity Securities) and (B) for any transactions or events
occurring after such Recapitalization Transaction that require an
adjustment to the Settlement Rate under subsection (a) of this Section
5.8 or (ii) shares of such other Common Equity Securities at a
Settlement Rate determined under Section 5.1 based on the Applicable
Market Value of such other Common Equity Securities and equal to the
Settlement Rate in effect immediately prior to such Recapitalization
Transaction multiplied
by the number of such other Common Equity Securities issued in respect
of one share of PCS Common Stock in such Recapitalization Transaction
and as adjusted in accordance with subsection (a) of this Section 5.8
(A) for any premium paid to holders of PCS Common Stock in such
Recapitalization Transaction other than in the form of such other
Common Equity Securities and (B) for any transactions or events
occurring after such Recapitalization Transaction that require an
adjustment to the Settlement Rate under subsection (a) of this Section
5.8, with the provisions of such subsection applying to events relating
to such other Common Equity Securities to the same extent as they apply
to events relating to the PCS Common Stock. In the event that any
Recapitalization Transaction of the type contemplated by this paragraph
(1) occurs, the Company shall, at least 30 Business Days prior to the
Purchase Contract Settlement Date, provide each Holder with an election
form pursuant to which the Holder may elect to receive either PCS
Common Stock or the other Common Equity Securities upon settlement of
the Purchase Contracts as provided in this paragraph (1). Any Holder
for whom the Company has not received a completed election form on or
before the Business Day immediately preceding the Purchase Contract
Settlement Date will be deemed to have elected to receive PCS Common
Stock.
(2) If (i) the Company completes a Recapitalization
Transaction pursuant to which all of the shares of PCS Common Stock
outstanding immediately prior to such transaction are exchanged for or
converted, changed or reclassified into shares of other Common Equity
Securities, or (ii) all of the outstanding shares of PCS Common Stock
are converted into shares of FON Common Stock or common stock of a
Subsidiary pursuant to the PCS Conversion Provisions or PCS Optional
Redemption Provision (in any case, a "Conversion") then thereafter each
Holder of Securities will receive on the Purchase Contract Settlement
Date with respect to each Purchase Contract forming a part thereof only
such other Common Equity Securities at a Settlement Rate determined
under Section 5.1 based on the Applicable Market Value of such other
Common Equity Securities and equal to the
Settlement Rate in effect immediately prior to such Recapitalization
Transaction or Conversion multiplied by the number of such other Common
Equity Securities issued in respect of one share of PCS Common Stock in
such Recapitalization Transaction or Conversion and as adjusted in
accordance with subsection (a) of this Section 5.8 (A) for any premium
paid to holders of PCS Common Stock in such Recapitalization
Transaction other than in the form of such other Common Equity
Securities and (B) for any transactions or events occurring after such
Recapitalization Transaction or Conversion that require an adjustment
to the Settlement Rate under subsection (a) of this Section 5.8, with
the provisions of such subsection applying to events relating to such
other Common Equity Securities to the same extent as they apply to
events relating to the PCS Common Stock.
(c) Adjustment for Consolidation, Merger, Spin-Off Transaction or Other
Reorganization Event. In the event of (i) any Recapitalization Transaction
pursuant to which all outstanding shares of PCS Common Stock are exchanged for
or converted, changed or reclassified into cash, securities or other property
not including Common Equity Securities, (ii) any consolidation, merger or other
business combination of the Company with or into another Person (other than a
merger, consolidation or other business combination in which the Company is the
continuing corporation and in which the PCS Common Stock outstanding immediately
prior to the merger, consolidation or other business combination is not
exchanged for cash, securities or other property of the Company or another
corporation), (iii) any sale, transfer, lease or conveyance to another Person of
the property of the Company as an entirety or substantially as an entirety, (iv)
any statutory exchange of securities of the Company with another Person (other
than in connection with a merger acquisition or other business combination) (v)
any Spin-Off Transaction involving the conversion, exchange or reclassification
of all of the outstanding shares of PCS Common Stock into securities of another
Person, 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
described in clauses (i)-(vi), a "Reorganization Event"), the Settlement Rate
will be adjusted to provide that each Holder of Securities will
receive on the Purchase Contract Settlement Date with respect to each Purchase
Contract forming a part thereof (or upon any Early Settlement), the kind and
amount of securities, cash and other property receivable upon 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
Purchase Contract Settlement Date) by a Holder of the number of shares of PCS
Common Stock issuable on account of each Purchase Contract if the Purchase
Contract Settlement Date had occurred immediately prior to such Reorganization
Event assuming such Holder of PCS Common Stock 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 PCS Common
Stock held by Affiliates of the Company and non-affiliates and such Holder
failed to exercise its 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 PCS
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 (a "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 the
non-electing shares).
In the event of such a Reorganization Event described in
clauses (ii)-(vi) above, the Person formed by such consolidation, merger,
Spin-Off Transaction, business combination or exchange or the Person which
acquires or leases 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 Holders of each Outstanding Security
shall have the rights provided by this Section
5.8. 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. In the event of a Reorganization Event described in clause (i) above,
the adjustment provisions of this Section shall apply to the extent practicable
to any securities issued in the Recapitalization Transaction. The above
provisions of this Section shall similarly apply to successive Reorganization
Events.
(d) Redemption of PCS Common Stock. In case the Company shall pay a
dividend on or redeem all or most of the outstanding shares of PCS Common Stock
pursuant to the PCS Mandatory Redemption Provision in or for cash, securities or
other property, the Company shall provide Holders of Purchase Contracts with no
less than 30 days prior written notice of such redemption. In that event,
Holders of Purchase Contracts, in the case of such a dividend, may, and in the
case of such a redemption, must elect Early Settlement at any time on or prior
to the third Business Day immediately preceding such redemption. In connection
with any Early Settlement pursuant to this Section 5.8(d), notwithstanding
Section 5.11(b), Holders shall be entitled to receive (i) the number of shares
of PCS Common Stock equal to the Settlement Rate as if the date of Early
Settlement was the Purchase Contract Settlement Date plus (ii) an amount of cash
equal to the present value of each of the Contract Adjustment Payments to which
such Holder would have been entitled if such Holder had held such Purchase
Contract until the Purchase Contract Settlement Date, discounted back from the
date each such Contract Adjustment Payment would have been made to the date of
Early Settlement at a discount rate equal to [ ]. In the event that a Holder of
Treasury Units elects to engage in a Redemption Early Settlement, such Holder
shall also be entitled to surrender the Treasury Securities underlying such
Treasury Units (in lieu of cash payment of the Stated Amount upon Early
Settlement as set forth in Section 5.11), in full satisfaction of such Holder's
obligation to deliver the Purchase Price upon such Redemption Early Settlement.
SECTION 5.9. Notice of Adjustments and Certain Other Events.
----------------------------------------------
(a) Whenever the Settlement Rate is adjusted as herein provided, the Company
shall:
(i) forthwith compute the Settlement Rate in accordance with
Section 5.8 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) within 10 Business Days following the occurrence of an
event that requires an adjustment to the Settlement Rate pursuant to
Section 5.8 (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 Securities 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 Securities 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 PCS
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 PCS 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 5.10. Termination Event; Notice. The Purchase
--------------------------
Contracts and all obligations and rights of the Company and the Holders
thereunder, including, without limitation, the rights and obligations of Holders
to
purchase PCS 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 Purchase Contract Settlement Date, a Termination
Event shall have occurred. Upon and after the occurrence of a Termination Event,
the Securities shall thereafter represent the right to receive the Notes or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, forming a part of such Securities in the case of Corporate Units, or
Treasury Securities in the case of Treasury Units, in accordance with the
provisions of Section 4.3 of the Pledge Agreement; provided, however, that, to
the extent that a Holder of Corporate Units or Treasury Units would otherwise be
entitled to receive less than $1,000 principal amount at maturity of the
Treasury Portfolio or the Treasury Securities, the Agent shall dispose of such
securities for cash, and transfer the appropriate amount of such cash to such
Holder in accordance with such Holder's instructions. 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.
SECTION 5.11. Early Settlement. (a) Subject to and upon
-----------------
compliance with the provisions of this Section 5.11, at the option of the Holder
thereof, Purchase Contracts underlying Securities having an aggregate Stated
Amount equal to $1,000 or an integral multiple thereof may be settled early
("Early Settlement") in the case of Corporate Units (unless a Tax Event
Redemption or any earlier Successful Remarketing has occurred) on or prior to
the fifth Business Day immediately preceding the Purchase Contract Settlement
Date and in the case of Treasury Units on or prior to the second Business Day
immediately preceding the Purchase Contract Settlement Date, in each case, as
provided herein; provided however, that if a Tax Event Redemption or any earlier
Successful Remarketing has occurred and the Treasury Portfolio has become a
component of the Corporate Units, Purchase Contracts underlying Corporate Units
may be settled early on or prior to the second Business Day immediately
preceding the Purchase Contract Settlement Date, but only in an aggregate amount
of ____ Corporate Units or in an integral multiple thereof.
In order to exercise the right to effect Early Settlement with respect to any
Purchase Contracts, the Holder of the Certificate evidencing Securities shall
deliver such Certificate to the Agent at the Corporate Trust Office or the New
York 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 the product of (i) the
Stated Amount times (ii) the number (A) 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
the second to last paragraph of Section 5.2, 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 dividends on the PCS
Common Stock issued upon such Early Settlement or on account of any Deferred
Contract Adjustment Payments. If the foregoing requirements are first satisfied
with respect to Purchase Contracts underlying any Securities 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 Securities 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
Securities shall be the next succeeding Business Day.
(b) Upon Early Settlement of Purchase Contracts by a Holder of
the related Securities and payment of any transfer or similar taxes payable by
such Holder in connection with the issuance of the related PCS Common Stock to
any person other than such Holder, the Company
shall issue, and the Holder shall be entitled to receive, _____ shares of PCS
Common Stock on account of each Purchase Contract as to which Early Settlement
is effected (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 5.11, 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 PCS Common Stock
issuable (or otherwise required to be delivered) upon such Early Settlement
together with payment in lieu of any fraction of a share, as provided in Section
5.12.
(c) No later than the third Business Day after the applicable
Early Settlement Date the Company shall cause (i) the shares of PCS Common Stock
issuable (or otherwise required to be delivered) upon Early Settlement of
Purchase Contracts to be delivered, and (ii) the related Notes or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, in the case
of Corporate Units, or the related Treasury Securities, in the case of Treasury
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.
(d) Upon Early Settlement of any Purchase Contracts, and
subject to receipt of shares of PCS Common Stock from the Company and the Notes,
the appropriate Applicable Ownership Interest of the Treasury Portfolio or
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 Securities, (i) transfer to the Holder
the Notes, Treasury Portfolio or Treasury Securities, as the case may be,
forming a part of such Securities, and (ii) deliver to the Holder a certificate
or certificates for the full number of shares of PCS Common Stock issuable (or
otherwise required to be delivered) 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 Securities 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 Securities as to which
Early Settlement was not effected.
SECTION 5.12. No Fractional Shares. No fractional shares or
---------------------
scrip representing fractional shares of PCS Common Stock shall be issued or
delivered upon settlement on the Purchase Contract Settlement Date or upon Early
Settlement of any Purchase Contracts. If Certificates evidencing more than one
Purchase Contract shall be surrendered for settlement at one time by the same
Holder, the number of full shares of PCS 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 PCS Common Stock which would otherwise be deliverable upon
settlement of any Purchase Contracts on the Purchase Contract Settlement Date or
upon Early Settlement, the Company, through the Agent, shall make a cash payment
in respect of such fractional interest 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.
SECTION 5.13. Charges and Taxes. The Company will pay all
------------------
stock transfer and similar taxes attributable to the initial issuance and
delivery of the shares of PCS Common Stock pursuant to the Purchase Contracts
and in payment of any Deferred Contract Adjustment Payment; provided, however,
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 Security or any issuance of a share of PCS Common Stock in a name
other than that of the registered Holder of a Certificate surrendered in respect
of the Securities 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 or 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 or that no such tax is due.
ARTICLE VI
Remedies
--------
SECTION 6.1. Unconditional Right of Holders to Purchase PCS
----------------------------------------------
Common Stock. The Holder of any Corporate Units or Treasury Units shall have the
-------------
right, which is absolute and unconditional, (A), subject to the right of the
Company to defer payment thereof pursuant to Section 5.4, and to the forfeiture
of any Deferred Contract Adjustment Payments upon Early Settlement pursuant to
Section 5.11(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 Security on the
respective Payment Date for such Security and (B) to purchase PCS Common Stock
pursuant to such Purchase Contract and to institute suit for the enforcement of
such right to purchase PCS Common Stock, and such right 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.
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 the last paragraph of Section 3.10, 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 Corporate Units or Treasury Units, by its
acceptance of such Corporate Units or Treasury Units 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 Securities, or to any suit instituted by any Holder
for the enforcement of interest on any Notes on or after the respective Payment
Date therefor in respect of any Security held by such Holder, or for enforcement
of the right to purchase shares of PCS Common Stock under the Purchase Contracts
constituting part of any Security 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 and covenants
that it will not hinder, delay or impede the execution of any power herein
granted to the Agent or the Holders, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE VII
The Agent
---------
SECTION 7.1. Certain Duties and Responsibilities. (a) (1) The
------------------------------------
Agent undertakes to perform, with respect to the Securities, such duties and
only such duties as are specifically set forth in this Agreement and the Pledge
Agreement, and no implied covenants or obligations shall be read into this
Agreement against the Agent; and
(2) The Agent may, with respect to the Securities,
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Agent and conforming to the requirements of
this Agreement, but in the case of any certificates or opinions which
by any provision hereof
are specifically required to be furnished to the Agent, the Agent shall
be under a duty to examine the same to determine whether or not they
conform to the requirements of this Agreement, but need not confirm or
investigate the accuracy of mathematical calculations stated therein.
(b) No provision of this Agreement shall be construed to relieve the
Agent from liability for its own negligent action, its own negligent failure to
act, or its own wilful misconduct or bad faith, except that:
(1) this Subsection shall not be construed to limit the effect
of Subsection (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
by a court of competent jurisdiction that the Agent was negligent in
ascertaining the pertinent facts; and
(3) no provision of this Agreement shall require the Agent to
expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder, or in the exercise
of any of its rights or powers.
(c) Whether or not therein expressly so provided, every provision of
this Agreement relating to the conduct or affecting the liability of or
affording protection to the Agent shall be subject to the provisions of this
Section.
(d) The Agent is authorized to execute and deliver the Pledge Agreement
in its capacity as Agent.
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 Securities, 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) the Agent may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or
document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) 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;
(c) 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;
(d) the Agent may consult with counsel of its selection and the advice
of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon;
(e) 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 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
(f) 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 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 or Issuance of
-------------------------------------------
Securities. The recitals contained herein and in the Certificates shall be taken
----------
as the statements of the Company and the Agent assumes no responsibility for
their accuracy. The Agent makes no representations as to the validity or
sufficiency of either this Agreement or of the Securities, or of the Pledge
Agreement or the Pledge. The Agent shall not be accountable for the use or
application by the Company of the proceeds in respect of the Purchase Contracts.
SECTION 7.5. May Hold Securities. 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 Securities 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.
SECTION 7.6. Money Held in Custody. Money held by the Agent in
----------------------
custody hereunder need not be segregated from the 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 expressly provided herein or as otherwise agreed in writing
with the Company.
SECTION 7.7. Compensation and Reimbursement. The Company
------------------------------
agrees:
(1) to pay to the Agent such compensation for all services
rendered by it hereunder in accordance with Schedule A attached hereto
and made a part hereof;
(2) except as otherwise expressly provided herein, 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 expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence, willful misconduct or bad faith; and
(3) to indemnify the Agent, its officers, directors,
employees, agents and any predecessor Agent for, and to hold it
harmless against, any loss, liability or expense, including taxes
(other than taxes based upon, measured by or determined by the income
of the Agent) incurred without negligence, willful misconduct or bad
faith on its part, arising out of or in connection with the acceptance
or administration of its duties hereunder, including the costs and
expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or
duties hereunder.
The provisions of this Section shall survive the resignation
or termination of the Agent or 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 subsidiary 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 an office in
the Borough of Manhattan, The City of New York, if there be such a corporation
in the Borough of Manhattan, The City of New York, 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. The provisions of
this Section shall survive the termination of this Agreement.
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 Securities delivered to the Agent and
the Company. 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.
(d) If at any time
(1) the Agent fails to comply with Section 310(b) of the TIA,
as if the Agent were an indenture 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 Security 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 a 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,
(i) the Company by a Board Resolution may remove the Agent, or (ii) any
Holder who has been a bona fide Holder of a Security 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
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 Security 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 and New York
Office, if any.
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
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 may 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 Securities.
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 Security 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 Securities 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 for the payment, of the reasonable expenses of such
mailing.
SECTION 7.13. No Obligations of Agent. Except to the extent
------------------------
otherwise provided in this Agreement, the Agent assumes no obligations 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
Security thereunder. The Company agrees, and each Holder of a Certificate, by
his 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 hereof.
SECTION 7.14. 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 Securities or
(ii) the issuance, delivery, holding, transfer, redemption or exercise of
rights under the Securities. 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 written direction 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) hereof.
(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.
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:
(1) 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
(2) 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
(3) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(4) to make provision with respect to the rights of Holders
pursuant to the requirements of Section 5.8(c); or
(5) 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.
------------------------------------------------
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 Securities (other than the Notes, which may be modified only in
accordance with the applicable provisions of the Indenture; provided, however,
that, except as contemplated herein, no such supplemental agreement shall,
without the consent of the Holder of each Outstanding Security affected thereby,
(1) change any Payment Date;
(2) change the amount or the type of Collateral required to be
Pledged to secure a Holder's obligations under any 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 Corporate Units to substitute the Treasury Securities for
the pledged Notes or the rights of holders of Treasury Units to
substitute Notes for the Pledged Treasury Securities) or otherwise
adversely affect the Holder's rights in or to such Collateral or
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;
(5) reduce the number of shares of PCS Common Stock (or the
amount of any other property) to be purchased pursuant to any Purchase
Contract, increase the price to purchase shares of PCS Common Stock (or
any other property) upon settlement of any Purchase Contract, change
the Purchase Contract Settlement Date or otherwise 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 Corporate Units or the Treasury 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.
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 entitled to receive and (subject
to Section 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 and
the Securities 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 merge, consolidate or consummate any other business combination with
any other Person or 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, unless (a) either the
Company shall be the continuing corporation or the successor Person or its
parent entity shall expressly assume all the obligations of the Company under
the Purchase Contracts, 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 (b) the Company or such successor
Person or its parent entity, as the case may be, shall not, immediately after
such merger, consolidation or other business combination, or such sale,
assignment, transfer, lease or conveyance, be in default of its payment or other
material obligations under this Agreement, including its obligations to deliver
PCS Common Stock (or other property) on the Purchase Contract Settlement Date or
any Early Settlement Date, the Remarketing Agreement, the Purchase Contracts or
the Pledge Agreement.
SECTION 9.2. Rights and Duties of Successor Corporation. 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 and its predecessor shall, except in the case of a lease, be released
from its obligations under this Agreement. Such successor corporation thereupon
may cause to be signed, and may issue either in its own name or in the name of
Sprint Corporation any or all of the Certificates evidencing Securities 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 Securities
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.
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 Securities 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 hereunder to the
consummation of any such consolidation, merger, sale, assignment, transfer,
lease or conveyance have been met.
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 Securities 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. The Company
--------------------------------
will maintain or cause to be maintained in the Borough of Manhattan, The City of
New York an office or agency (a "New York Office") where Certificates may be
presented or surrendered for payment and for acquisition of shares of PCS Common
Stock (or other property) upon settlement of the Purchase Contracts on the
Purchase Contract Settlement Date or Early Settlement 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 re-establishment of a Corporate Unit and where notices and
demands to or upon the Company in respect of the Securities 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.
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, however, 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 the Borough of Manhattan, the
City of New York, as the places of payment for the Securities, and hereby
appoints the Agent, acting through its Corporate Trust Office in Columbus, Ohio,
as the registrar, paying agent and transfer agent for the Corporate Units and
the Treasury Units and for the other purposes contemplated by this Section 10.2.
SECTION 10.3. Company to Reserve PCS Common Stock. The Company
------------------------------------
shall at all times prior to the Purchase Contract Settlement Date reserve and
keep available, free from preemptive rights, out of its authorized but unissued
PCS Common Stock the full number of
shares of PCS Common Stock issuable against tender of payment in respect of all
Purchase Contracts constituting a part of the Securities evidenced by
Outstanding Certificates.
SECTION 10.4. Covenants as to PCS Common Stock. The Company
---------------------------------
covenants that all shares of PCS Common Stock which may be issued against tender
of payment in respect of any Purchase Contract constituting a part of the
Outstanding Securities will, upon issuance, be duly authorized, validly issued,
fully paid and nonassessable. The Company shall comply with all applicable
securities laws regulating the offer, issuance and delivery of shares of PCS
Common Stock upon settlement of Purchase Contracts and will endeavor to list
such shares on each national securities exchange or automated quotation system
on which the PCS Common Stock is then listed.
ARTICLE XI
Assignment
----------
SECTION 11.1. Assignment of Agreement. (a) In the event that
------------------------
the Company is entering into a Spin-Off Transaction to which Section 5.8(c)
applies, the Company may assign its obligations under this Agreement to any
entity that, at the time of or immediately before the effective date of such
assignment, is an Affiliate of the Company, provided (i) such entity is a
corporation organized 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, this Agreement,
the Pledge Agreement and the Remarketing Agreement and (ii) such corporation is
not, immediately after such assignment, in default of its payment obligations or
other material obligations under the Purchase Contracts, this Agreement, the
Remarketing Agreement or the Pledge Agreement.
(b) The Company shall provide Holders of Purchase Contracts
with no less than 30 days prior written notice of any Spin-Off Transaction to
which Section 5.8(c) applies and its intent to assign the Purchase Contracts to
an Affiliate pursuant to this Section 11.1.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed as of the day and year first above written.
SPRINT CORPORATION,
By:____________________________
Name:
Title:
By:____________________________
Name:
Title:
-------------------------------
as Purchase Contract Agent
By:____________________________
Name:
Title:
EXHIBIT A
(Form of Face of Corporate 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, A NEW YORK CORPORATION ("DTC")
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 IN SUCH
OTHER NAME AS IF REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC, IF ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC, ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
No. _____
CUSIP No. Number of Corporate Units _______
____% Corporate Units
This Corporate Units Certificate certifies that ___________ is
the registered Holder of the number of Corporate Units set forth above. Each
Corporate Unit represents (i) either (a) beneficial ownership by the Holder of
$25 principal amount of ____% Senior Notes due _______________, 2006 (the
"Note")of Sprint Capital Corporation, a Delaware corporation, subject to the
Pledge
of such Note by such Holder pursuant to the Pledge Agreement or (b) upon the
occurrence of a Tax Event Redemption prior to August 17, 2004 or any earlier
Successful Remarketing, the appropriate Applicable Ownership Interest of the
Treasury Portfolio, subject to the Pledge of such Applicable Ownership Interest
of the Treasury Portfolio by such Holder pursuant to the Pledge Agreement, and
(ii) the rights and obligations of the Holder under one Purchase Contract with
Sprint Corporation, a Kansas corporation (the "Company," which term, as used
herein, includes its successors pursuant to the Purchase Contract Agreement).
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 Notes or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
constituting part of each Corporate Unit evidenced hereby have 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 portion of such Corporate
Unit.
The Pledge Agreement provides that all payments of principal
on the Pledged Notes (as defined in the Pledge Agreement) or the appropriate
Applicable Ownership Interest (as specified in clause (i) of the definition of
such term) of the Treasury Portfolio, as the case may be, or interest payments
on any Pledged Notes or the appropriate Applicable Ownership Interest (as
specified in clause (ii) of the definition of such term) of the Treasury
Portfolio, as the case may be, constituting part of the Corporate Units 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) interest payments with respect to
pledged Notes or the appropriate Applicable Ownership Interest (as specified in
clause (ii) of the definition of such term) of the Treasury Portfolio, as the
case may be, or (B) any payments of principal or the appropriate Applicable
Ownership Interest (as specified in clause (i) of the definition of such term)
of the Treasury Portfolio, as the case may be, with respect to any Notes or the
appropriate Applicable Ownership Interest of 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 2:00 p.m., New York City time, on
the Business Day such payment is received by the Collateral Agent (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) and (ii) in the case of payments of principal on any pledged Notes or
the appropriate Applicable Ownership Interest (as specified in clause (i) of the
definition of such term) of the Treasury Portfolio that has not been released
from the Pledge pursuant to the Pledge Agreement, as the case may be, to the
Company on the Purchase Contract Settlement 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 Corporate Units of which such
pledged Notes or the Treasury Portfolio, as the case may be, are a part under
the Purchase Contracts forming a part of such Corporate Units. Payments on any
Notes or distributions on the appropriate Applicable Ownership Interest (as
specified in clause (ii) of the definition of such term) of the Treasury
Portfolio, as the case may be, forming part of a Corporate Unit evidenced hereby
which are payable quarterly in arrears on February 17, May 17, August 17 and
November 17 (a "Payment Date"), each year, commencing November 17, 2001, shall,
subject to receipt thereof by the Agent from the Collateral Agent, be paid to
the Person in whose name this Corporate Units Certificate (or a Predecessor
Corporate 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 Corporate Units Certificate to purchase, and the Company to sell, on
August 17, 2004 (the "Purchase Contract Settlement Date"), at a price equal to
$25.00 (the "Stated Amount"), a number of shares of PCS Common Stock, Series 1,
$1.00 par value per share ("PCS Common Stock"), of the Company equal to the
Settlement Rate, unless on or prior to the Purchase Contract Settlement Date
there shall have occurred a Termination Event or an Early Settlement with
respect to the Corporate 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 (the "Purchase Price") for the shares of PCS Common
Stock purchased pursuant to each Purchase Contract evidenced hereby, if not paid
earlier, shall be paid on the Purchase Contract Settlement Date by application
of payment received in respect of the Notes or the appropriate Applicable
Ownership Interest (as specified in clause (A) of the definition of such term)
of the Treasury Portfolio, as the case may be, pledged to secure the obligations
under such Purchase Contract of the Holder of the Corporate Units of which such
Purchase Contract is a part.
Payments on the Notes or distributions on the appropriate
Applicable Ownership Interest (as specified in clause (ii) of the definition of
such term) of the Treasury Portfolio, as the case may be, will be payable at the
Corporate Trust Office of the Agent and at the New York Office or, at the option
of the Company, by check mailed to the address of the Person entitled thereto as
such address appears on the Corporate Units Register.
The Company shall pay on each Payment Date in respect of each
Purchase Contract forming part of a Corporate Unit evidenced hereby an amount
(the "Contract Adjustment Payments") equal to ___% 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. Such Contract
Adjustment Payments shall be payable to the Person in whose name this Corporate
Units Certificate (or a Predecessor Corporate 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 Corporate
Trust Office of the Agent and at the New York Office or, at the option of the
Company, by check mailed to the address of the Person entitled thereto as such
address appears on the Corporate 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 Corporate 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.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
SPRINT CORPORATION,
By:__________________________
Name:
Title:
By:__________________________
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations of such Holder under the Purchase
Contracts evidenced hereby)
By: BANK ONE, NATIONAL ASSOCIATION,
not individually but solely as
attorney-in-fact of such Holder
By:___________________________
Name:
Title:
Dated:
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Corporate Units Certificates referred to in the
within mentioned Purchase Contract Agreement.
By: BANK ONE, NATIONAL ASSOCIATION,
------------------------------
as Purchase Contract Agent
By: _____________________________
Authorized Signatory
Dated:
(Form of Reverse of Corporate Units Certificate)
Each Purchase Contract evidenced hereby is governed by a
Purchase Contract Agreement, dated as of _________, 2001 (as may be supplemented
from time to time, the "Purchase Contract Agreement"), between the Company and
Bank One, 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 Corporate Units Certificates are, and are to be, executed
and delivered.
Each Purchase Contract evidenced hereby obligates the Holder
of this Corporate Units Certificate to purchase, and the Company to sell, on the
Purchase Contract Settlement Date at a price equal to the Purchase Price, a
number of shares of PCS Common Stock equal to the Settlement Rate, unless, on or
prior to the Purchase Contract Settlement Date, there shall have occurred a
Termination Event or an Early Settlement with respect to the Security of which
such Purchase Contract is a part. The "Settlement Rate" is equal to (a) if the
Applicable Market Value (as defined below) is equal to or greater than $______
(the "Threshold Appreciation Price"), ______ shares of PCS Common Stock per
Purchase Contract, (b) if the Applicable Market Value is less than the Threshold
Appreciation Price but is greater than $_______, the number of shares of PCS
Common Stock per Purchase Contract equal to the Stated Amount divided by the
Applicable Market Value and (c) if the Applicable Market Amount is less than or
equal to $_______, _______ shares of PCS Common Stock per Purchase Contract, in
each case subject to adjustment as provided in the Purchase Contract Agreement.
No fractional shares of PCS Common Stock will be issued upon settlement of
Purchase Contracts, as provided in the Purchase Contract Agreement.
Each Purchase Contract evidenced hereby which is settled
either through Early Settlement or Cash Settlement shall obligate the Holder of
the related Corporate Units to purchase at the Purchase Price, and the Company
to sell, a number of shares of PCS Common Stock equal to the Early Settlement
Rate or the Settlement Rate, as applicable.
The "Applicable Market Value" means the average of the Closing
Price per share of PCS Common Stock on each
of the 20 consecutive Trading Days ending on the third Trading Day immediately
preceding the Purchase Contract Settlement Date or, for purposes of determining
cash payable in lieu of fractional shares in connection with an Early
Settlement, the third Trading Day immediately preceding the relevant Early
Settlement Date.
The "Closing Price" of the PCS 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 PCS Common Stock on the NYSE on such date
or, if the PCS 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
national or regional securities exchange on which the PCS Common Stock is so
listed, or if the PCS Common Stock is not so listed on a United States national
or regional securities exchange, as reported by the Nasdaq National Market, or,
if the PCS Common Stock is not so reported, the last quoted bid price for the
PCS 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 PCS 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 PCS 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 PCS Common Stock.
In accordance with the terms of the Purchase Contract
Agreement, the Holder of this Corporate Units Certificate shall pay the Purchase
Price for the shares of PCS Common Stock purchased pursuant to each Purchase
Contract evidenced hereby by effecting a Cash Settlement or an Early Settlement
or from the Proceeds of a remarketing of the related Pledged Notes of such
holders. Unless a Tax Event Redemption, Termination Event or a Successful
Remarketing has occurred, a Holder of Corporate Units who does not elect to make
an effective (a) Cash Settlement on or prior to 5:00 p.m. New York City time on
the fifth Business Day immediately preceding the Purchase Contract Settlement
Date, or (b) Early Settlement on or prior to 5:00 p.m. New York City time on the
fifth Business Day immediately preceding the Purchase Contract Settlement Date,
shall pay the Purchase Price for the shares of PCS Common Stock to be issued (or
otherwise delivered) under the related Purchase Contract from the Proceeds of
the sale of the related pledged Notes held by the Collateral Agent. Unless a Tax
Event Redemption, Termination Event or a Successful Remarketing has occurred,
such sale will be made by the Remarketing Agent pursuant to the terms of the
Supplemental Remarketing Agreement and the Remarketing Agreement on the third
Business Day immediately preceding the Purchase Contract Settlement Date. If a
Tax Event Redemption or Remarketing has occurred, a Holder of Corporate Units
who does not elect to make an effective Early Settlement on or prior to 5:00
p.m. New York City time on the second Business Day immediately preceding the
Purchase Contract Settlement Date shall pay the Purchase Price with the Proceeds
at maturity of the Applicable Ownership Interest (as specified in clause (i) of
the definition of such term) of the Treasury Portfolio.
The Company shall not be obligated to issue (or otherwise
deliver) any shares of PCS 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 PCS 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 Corporate Units holders a notice (a) containing such information as
is contained in the notice or solicitation, (b) stating that each Corporate
Units 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 Notes constituting a part of
such holder's Corporate Units and (c) stating the manner in which such
instructions may be given. Upon the written request of the Corporate Units
Holders 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 Notes as to which any particular voting
instructions are received. In the absence of specific instructions from the
Holder of a Corporate Unit, the Agent shall abstain from voting the Notes
evidenced by such Corporate Units.
Upon the occurrence of a Tax Event Redemption prior to August
17, 2004 or any earlier Successful Remarketing, pursuant to the terms of the
Pledge Agreement, the Collateral Agent will apply, out of the aggregate
Redemption Price for the Notes that are components of Corporate Units, an amount
equal to the aggregate Redemption Amount for the Notes that are components of
Corporate Units to purchase on behalf of the Holders of Corporate Units, the
Treasury Portfolio and, promptly remit the remaining portion of such Redemption
Price to the Agent for payment to the Holders of such Corporate Units.
Upon the occurrence of a Successful Initial Remarketing or
Successful Subsequent Remarketing, pursuant to the terms of the Remarketing
Agreement, the Remarketing Agent will apply an amount equal to the Treasury
Portfolio Purchase Price to purchase on behalf of the Holders of Corporate
Units, the Treasury Portfolio, and, after deducting the Remarketing Fee to the
extent permitted under the terms of the Remarketing Agreement, promptly remit
the remaining portion of such Proceeds of the Successful Remarketing to the
Agent for payment to the Holders of such Corporate Units.
Following the occurrence of a Tax Event Redemption prior to
the Purchase Contract Settlement Date or an earlier Successful Remarketing, the
Holders of Corporate Units and the Collateral Agent shall have such security
interests rights and obligations with respect to the Treasury Portfolio as the
Holder of Corporate Units and the Collateral Agent had in respect of the Notes,
as the case may be, subject to the Pledge thereof as provided in the Pledge
Agreement and any reference herein 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 Corporate Units Certificates are issuable only in
registered form and only in denominations of a single Corporate Unit and any
integral multiple thereof. The transfer of any Corporate Units Certificate will
be registered and Corporate Units Certificates may be exchanged as provided in
the Purchase Contract Agreement. The Corporate 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. A Holder who elects to
substitute Treasury Securities for Notes or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, thereby creating Treasury 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 Corporate Unit remains in effect, such Corporate Units
shall not be separable into its constituent parts, and the rights and
obligations of the Holder of such Corporate Units in respect of Notes or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, and the Purchase Contract constituting such Corporate Units may be
transferred and exchanged only as a Corporate Unit. A Holder of a Corporate Unit
may create a Treasury Unit by delivering to the Collateral Agent Treasury
Securities in an aggregate principal amount equal to the aggregate principal
amount of the pledged Notes or the appropriate Applicable Ownership Interest (as
specified in clause (i) of the definition of such term) of the Treasury
Portfolio, as the case may be, in exchange for the release of such pledged Notes
or the appropriate Applicable Ownership Interest of the Treasury Portfolio, as
the case may be, in accordance with the terms of the Purchase Contract Agreement
and the Pledge Agreement. From and after such Collateral Substitution, the
Security for which such Pledged Treasury Securities secures the Holder's
obligation under the Purchase Contract shall be referred to as a "Treasury
Unit." A Holder may make such Collateral Substitution only in integral multiples
of 40 Corporate Units for 40 Treasury Units; provided, however, that if a Tax
Event Redemption or an earlier Successful Remarketing has occurred and the
Treasury Portfolio has become a component of the Corporate Units, a Holder may
make such Collateral Substitutions only in integral multiples of ____ Corporate
Units for ____ Treasury Units. Such Collateral Substitution may cause the
equivalent aggregate Stated Amount of this Certificate to be increased or
decreased; provided, however, the equivalent aggregate Stated Amount outstanding
under this Corporate Units Certificate shall not exceed [ ]. All such
adjustments to the equivalent aggregate Stated Amount of this Corporate Units
Certificate shall be duly recorded by placing an appropriate notation on the
Schedule attached hereto.
A Holder of Treasury Units may recreate Corporate Units by
delivering to the Collateral Agent Notes or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, with an aggregate principal amount, in the
case of such Notes, or with the appropriate Applicable Ownership Interest (as
specified in clause (i) of the definition of such term) of the Treasury
Portfolio, in the case
of such appropriate Applicable Ownership Interest of the Treasury Portfolio,
equal to the aggregate principal amount of the Pledged Treasury Securities in
exchange for the release of such Pledged Treasury Securities in accordance with
the terms of the Purchase Contract Agreement and the Pledge Agreement. Any such
recreation of a Corporate Unit may be effected only in multiples of 40 Treasury
Units for 40 Corporate Units; provided, however, that if a Tax Event Redemption
or an earlier Successful Remarketing has occurred and the Treasury Portfolio has
become a component of the Corporate Units, a Holder may make such substitution
only in integral multiples of ____ Treasury Units for ____ Corporate Units.
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 Corporate Units
Certificate evidencing such Purchase Contract is registered at the close of
business on the Record Date for such Payment Date.
The Company shall have the right, at any time prior to the
Purchase Contract Settlement 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 __% 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
Purchase Contract Settlement 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 Purchase Contract Settlement 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 Purchase Contract Settlement Date, the Holder of this
Corporate Units Certificate will receive on the Purchase Contract Settlement
Date, in lieu of a cash payment, a number of shares of PCS Common Stock (in
addition to the number of shares of PCS Common Stock equal to the Settlement
Rate) equal to (i) the aggregate amount of Deferred Contract Adjustment Payments
payable to the Holder of this Corporate 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 series of PCS Common
Stock other than (i) purchases, redemptions or acquisitions of shares of any
series of PCS Common 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 any
series of PCS Common Stock or the exchange or conversion of one series of PCS
Common Stock for another series of PCS Common Stock; (iii) the purchase of
fractional interests in shares of any series of PCS Common Stock pursuant to the
conversion or exchange provisions of any series of PCS Common Stock or the
security being converted or exchanged; (iv) dividends or distributions in any
series of PCS Common Stock (or rights to acquire capital stock) or repurchases,
acquisitions or redemptions of any series of PCS Common Stock in connection with
the issuance or exchange of any series of PCS Common Stock (or securities
convertible into or exchangeable for shares of any series of PCS Common Stock;
(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; or (vi) redemptions
of PCS Common Stock pursuant to Section 7.1 of the Company's articles of
incorporation.
The Purchase Contracts and all obligations and rights of the
Company and the Holders thereunder, including, without limitation, the rights
and obligations of Holders to purchase PCS 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 Purchase Contract
Settlement 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 Corporate Units
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Notes or the appropriate Applicable Ownership Interest
of the Treasury Portfolio, as the case may be, from the Pledge in accordance
with the provisions of the Pledge Agreement.
Subject to and upon compliance with the provisions of the
Purchase Contract Agreement, at the option of the Holders thereof, Purchase
Contracts underlying Securities having an aggregate Stated Amount equal to
$1,000 or an integral multiple thereof may be settled early ("Early Settlement")
as provided in the Purchase Contract Agreement; provided, however, that if a Tax
Event Redemption or any earlier Successful Remarketing has occurred and the
Treasury Portfolio has become a component of the Corporate Units, Holders may
early settle Corporate Units only in integral multiples of ____ Corporate Units.
In order to exercise the right to effect Early Settlement with respect to any
Purchase Contracts evidenced by this Corporate Units Certificate, the Holder of
this Corporate Units Certificate shall deliver this Corporate Units Certificate
to the Agent at the Corporate Trust Office or the New York Office duly endorsed
for transfer to the Company or in blank with the form of Election to Settle
Early set forth below duly completed and accompanied by payment in the form of
immediately available funds payable to the Company in an amount (the "Early
Settlement Amount") equal to the product of (i) the Stated Amount times (ii) the
number of Purchase Contracts with respect to which the Holder has elected to
effect Early Settlement. Upon Early Settlement of Purchase Contracts by a Holder
of the related Securities, the pledged Notes or the appropriate Applicable
Ownership Interest of the Treasury Portfolio underlying such Securities shall be
released from the Pledge as provided in the Pledge Agreement and the Holder
shall be entitled to receive a number of shares of PCS Common Stock on account
of each Purchase Contract forming part of a Corporate Units as to
which Early Settlement is effected equal to the Early Settlement Rate. The Early
Settlement Rate shall initially be equal to __________ shares of PCS Common
Stock and shall be adjusted in the same manner and at the same time as the
Settlement Rate is adjusted as provided in the Purchase Contract Agreement.
Upon registration of transfer of this Corporate 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, the Pledge Agreement and the Purchase Contracts evidenced
hereby and the transferor shall be released from the obligations under the
Purchase Contract Agreement, the Pledge Agreement and the Purchase Contracts
evidenced by this Corporate 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 Corporate Units Certificate, by its
acceptance hereof, authorizes the Agent to enter into and perform the related
Purchase Contracts forming part of the Corporate 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 its 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 its behalf as its
attorney-in-fact, and consents to the Pledge of the Notes or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
underlying this Corporate 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, Proceeds of the pledged Notes or the appropriate
Applicable Ownership Interest (as specified in clause (i) of the definition of
such term) of the Treasury Portfolio on the Purchase Contract Settlement Date
shall be paid 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 Proceeds.
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 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 Corporate Units
Certificate is registered as the owner of the Corporate Units evidenced hereby
for the purpose of receiving payments of interest payable quarterly on the Notes
or on the maturing quarterly interest strips of the Treasury Portfolio, as
applicable, 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
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 PCS
Common Stock.
A copy of the Purchase Contract Agreement is available for
inspection at the offices of the Agent.
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.
--------------------------------
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 Treasury Units Certificates and all
rights thereunder, hereby irrevocably constituting and
appointing______________________________________________ attorney to transfer
said Treasury Units Certificates on the books of Sprint Corporation 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 Treasury Units Certificates in every
particular, without alteration or enlargement or any change whatsoever.
Signature Guarantee:_____________________________________ 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.
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of PCS
Common Stock deliverable upon settlement on or after the Purchase Contract
Settlement Date of the Purchase Contracts underlying the number of Corporate
Units evidenced by this Corporate 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) 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.
If shares are to be registered in the name of and delivered to a Person
other than the Holder, please (i) print such Person's name and address
REGISTERED HOLDER and (ii) provide a guarantee of your signature: Please print
name and address of Registered Holder:
Name
Address
--------------------------
REGISTERED HOLDER
Social Security or other
Taxpayer Identification
Number, if any
Please print name and address of Registered Holder:
Name
Address
ELECTION TO SETTLE EARLY
The undersigned Holder of this Corporate 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 Corporate Units evidenced by this Corporate
Units Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Corporate Units
with an aggregate Stated Amount equal to $1,000 or an integral multiple thereof;
provided, however, that if a Tax Event Redemption or an earlier Successful
Remarketing has occurred and the Treasury Portfolio has become a component of
the Corporate Units, Holders may early settle Corporate Units only in integral
multiples of __________ Corporate Units. The undersigned Holder directs that a
certificate for shares of PCS 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 Corporate Units Certificate
representing any Corporate 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 or the appropriate Applicable Ownership Interest of 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 (if assigned to another person):
_____________________________________
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.
Number of Securities evidenced hereby as to which Early Settlement of the
related Purchase Contracts is being elected:
If shares of PCS Common Stock or Corporate Units Certificates are to be
registered in the name of and delivered to and pledged Notes, or an Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, are to be
transferred to a Person other than the Holder, please (i) print such Person's
name and address and (ii) provide a guarantee of your signature:
Name
Address
Name
Address
REGISTERED HOLDER
Please print name and address of Registered Holder:
Name
Address
Social Security or other
Taxpayer Identification
Number, if any ___________
Transfer Instructions for pledged Notes, or the Applicable Ownership Interest in
the Treasury Portfolio, as the case may be, Transferable Upon Early Settlement
or a Termination Event:
[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:
Signature of
Stated Amount of this authorized signatory
Amount of decrease in Amount of increase in Global Certificate of Purchase Contract
Stated Amount of the Stated Amount of the following such Agent or Securities
Date Global Certificate Global Certificate decrease or increase Custodian
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EXHIBIT B
(Form of Face of Treasury 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 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 IN SUCH OTHER NAME AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC, (AND ANY PAYMENT IS MADE TO CEDE & CO. OR
TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
No._______________ CUSIP NO.
Number of Treasury Units ________________
____ % Treasury Units
This Treasury Units Certificate certifies that __________ is
the registered Holder of the number of Treasury Units set forth above. Each
Treasury Units represents (i) a 1/40, or 2.5%, undivided beneficial ownership
interest in a Treasury Security having a principal amount at maturity equal to
$1,000, subject to the Pledge of 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 Sprint Corporation, a
Kansas corporation (the "Company," which term, as used herein, includes its
successors pursuant to the Purchase Contract Agreement). 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 Securities
constituting part of each Treasury Units evidenced hereby have 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 portion of such Treasury
Units.
The Pledge Agreement provides that all payments of the
principal of any Treasury Securities received by the Collateral Agent shall be
paid by the Collateral Agent by wire transfer of same day funds (i) in the case
of any principal payments with respect to any Treasury Securities that have been
released from the Pledge pursuant to the Pledge Agreement, to the Holders of the
applicable Treasury Units to the accounts designated by them in writing for such
purpose no later than 2:00 p.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 12:30 p.m., New York City time, on a Business Day, then such payment
shall be made no later than 10:30 a.m., New York City time, on the next
succeeding Business Day), and (ii) in the case of the principal of any Pledged
Treasury Securities, to the Company on the Purchase Contract Settlement 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 Treasury Units
of which such Pledged Treasury Securities are a part under the Purchase
Contracts forming a part of such Treasury Units.
Each Purchase Contract evidenced hereby obligates the Holder
of this Treasury Units Certificate to purchase, and the Company to sell, on
August 17, 2004 (the "Purchase Contract Settlement Date"), at a price equal to
$25.00 (the "Stated Amount"), a number of shares of PCS Common Stock, Series 1,
$1.00 par value per share ("PCS Common Stock"), of the Company equal to the
Settlement Rate, unless on or prior to the Purchase Contract Settlement Date
there shall have occurred a Termination Event or an Early Settlement with
respect to the Treasury 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 (the "Purchase Price") for the shares of PCS Common
Stock purchased pursuant to each Purchase Contract evidenced hereby, if not paid
earlier, shall be paid on the Purchase Contract Settlement Date by application
of the Proceeds from the 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 Treasury Unit evidenced hereby an amount
(the "Contract Adjustment Payments") equal to ___% 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. Such Contract
Adjustment Payments shall be payable to the Person in whose name this Treasury
Units Certificate (or a Predecessor Treasury 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 Corporate
Trust Office of the Agent and at the New York Office or, at the option of the
Company, by check mailed to the address of the Person entitled thereto as such
address appears on the Corporate 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 Treasury 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.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
SPRINT CORPORATION,
By:___________________________
Name:
Title:
By:___________________________
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations of such Holder under the Purchase
Contracts)
By: BANK ONE NATIONAL
ASSOCIATION, not individually but
solely as attorney-in-fact of such Holder
By:___________________________
Name:
Title:
Dated:
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Treasury Units referred to in the within-mentioned
Purchase Contract Agreement.
By: BANK ONE, NATIONAL ASSOCIATION,
as Purchase Contract Agent
By:___________________________
Authorized Signatory
(Form of Reverse of Treasury Units Certificate)
Each Purchase Contract evidenced hereby is governed by a
Purchase Contract Agreement, dated as of August [ ], 2001 (as may be
supplemented from time to time, the "Purchase Contract Agreement"), between the
Company and Bank One, 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 Treasury Units Certificates are, and are
to be, executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder
of this Treasury Units Certificate to purchase, and the Company to sell, on the
Purchase Contract Settlement Date at the Purchase Price, a number of shares of
PCS Common Stock equal to the Settlement Rate, unless, on or prior to the
Purchase Contract Settlement Date, there shall have occurred a Termination Event
or an Early Settlement with respect to the Security of which such Purchase
Contract is a part. The "Settlement Rate" is equal to (a) if the Applicable
Market Value (as defined below) is equal to or greater than $______ (the
"Threshold Appreciation Price"), _______ shares of PCS Common Stock per Purchase
Contract, (b) if the Applicable Market Value is less than the Threshold
Appreciation Price but is greater than $______, the number of shares of PCS
Common Stock per Purchase Contract equal to the Stated Amount divided by the
Applicable Market Value and (c) if the Applicable Market Amount is less than or
equal to $______, ______ shares of PCS Common Stock per Purchase Contract, in
each case subject to adjustment as provided in the Purchase Contract Agreement.
No fractional shares of PCS Common Stock will be issued upon settlement of
Purchase Contracts, as provided in the Purchase Contract Agreement.
Each Purchase Contract evidenced hereby which is settled
through Early Settlement shall obligate the Holder of the related Treasury Units
to purchase at the Purchase Price, and the Company to sell, a number of shares
of PCS Common Stock equal to the Early Settlement Rate.
The "Applicable Market Value" means the average of the Closing
Price per share of PCS Common Stock on each of the 20 consecutive Trading Days
ending on the third Trading Day immediately preceding the Purchase Contract
Settlement Date or, for purposes of determining cash
payable in lieu of fractional shares in connection with an Early Settlement, the
third Trading Day immediately preceding the relevant Early Settlement Date.
The "Closing Price" of the PCS 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 PCS Common Stock on NYSE national or
regional on such date or, if the PCS 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 national or regional securities exchange on which the
PCS Common Stock is so listed, or if the PCS Common Stock is not so listed on a
United States national or regional securities exchange, as reported by the
Nasdaq National Market or, if the PCS Common Stock is not so reported, the last
quoted bid price for the PCS 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 PCS 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 PCS 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 PCS Common Stock.
In accordance with the terms of the Purchase Contract
Agreement, the Holder of this Treasury Units Certificate shall pay the Purchase
Price for the shares of PCS Common Stock purchased pursuant to each Purchase
Contract evidenced hereby by effecting either an Early Settlement of each such
Purchase Contract or by applying a principal amount of the Pledged Treasury
Securities underlying such Holder's Treasury Units equal to the Stated Amount to
the purchase of the PCS Common Stock. A Holder of Treasury Units who does not
elect, on or prior to 5:00 p.m. New York City time on the second Business Day
immediately preceding the Purchase Contract Settlement Date, to make an Early
Settlement, shall pay the Purchase Price for the shares of PCS Common Stock to
be issued (or otherwise delivered) on the related Purchase Contract by applying
a principal amount of the Pledged Treasury Securities as aforesaid.
The Company shall not be obligated to issue (or otherwise
deliver) any shares of PCS 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 PCS Common
Stock to be purchased thereunder in the manner herein set forth.
The Treasury Units Certificates are issuable only in
registered form and only in denominations of a single Treasury Units and any
integral multiple thereof. The transfer of any Treasury Units Certificate will
be registered and Treasury Units Certificates may be exchanged as provided in
the Purchase Contract Agreement. The Treasury 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. A Holder who elects to
substitute Notes or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, for Treasury Securities, thereby
recreating Corporate 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 Treasury Units
remains in effect, such Treasury Units shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such Treasury
Units in respect of the Treasury Security and the Purchase Contract constituting
such Treasury Units may be transferred and exchanged only as a Treasury Units. A
Holder of Treasury Units may recreate Corporate Units by delivering to the
Collateral Agent Notes or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, with an aggregate principal amount, in the case of such
Notes, or with the appropriate Applicable Ownership Interest (as specified in
clause (i) of the definition of such term) of the Treasury Portfolio, in the
case of such appropriate Applicable Ownership Interest of the Treasury
Portfolio, equal to the aggregate principal amount of the pledged Treasury
Securities in exchange for the release of such pledged Treasury Securities in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement. From and after such substitution, the Security for which such pledged
Notes or appropriate Applicable Ownership Interest of the Treasury Portfolio, as
the case may be, secures the Holder's obligation under the Purchase Contract
shall be referred to as a "Corporate Units." A Holder may make such
a substitution only in integral multiples of 40 Treasury Units for 40 Corporate
Units; provided, however, that if a Tax Event Redemption or a Successful
Remarketing has occurred and the Treasury Portfolio has become a component of
the Corporate Units, a Holder may make such substitution only in integral
multiples of _____ Treasury Units for ______ Corporate Units. Such substitution
may cause the equivalent aggregate Stated Amount of this Certificate to be
increased or decreased; provided, however, the equivalent aggregate Stated
Amount outstanding under this Treasury Units Certificate shall not exceed $[ ].
All such adjustments to the equivalent aggregate Stated Amount of this Treasury
Units Certificate shall be duly recorded by placing an appropriate notation on
the Schedule attached hereto.
A Holder of a Corporate Unit may create a Treasury Unit by
delivering to the Collateral Agent Treasury Securities in an aggregate principal
amount of the pledged Notes or the appropriate Applicable Ownership Interest (as
specified in clause (i) of the definition of such term) of the Treasury
Portfolio, as the case may be, in exchange for the release of such pledged Notes
or the appropriate Applicable Ownership Interest of the Treasury Portfolio, as
the case may be, in accordance with the terms of the Purchase Contract Agreement
and the Pledge Agreement. Any such creation of a Treasury Units may be effected
only in multiples of 40 Corporate Units for 40 Treasury Units; provided,
however, if a Tax Event Redemption or an earlier Successful Remarketing has
occurred and the Treasury Portfolio has become a component of the Corporate
Unit, a Holder may make such Collateral Substitution only in integral multiples
of __ Corporate Units for __ Treasury Units.
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 Treasury Units
Certificate evidencing such Purchase Contract is registered at the close of
business on the Record Date for such Payment Date.
The Company shall have the right, at any time prior to the
Purchase Contract Settlement 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 __% 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
Purchase Contract Settlement 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 Purchase Contract Settlement 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 Purchase
Contract Settlement Date, the Holder of this Treasury Units Certificate will
receive on the Purchase Contract Settlement Date, in lieu of a cash payment, a
number of shares of PCS Common Stock (in addition to the number of shares of PCS
Common Stock equal to the Settlement Rate) equal to (i) the aggregate amount of
Deferred Contract Adjustment Payments payable to the Holder of this Treasury
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 series of PCS Common
Stock other than (i) purchases, redemptions or acquisitions of shares of any
series of PCS Common 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 any series of PCS Common Stock or the
exchange or conversion of one series of PCS Common Stock for another series of
PCS Common Stock; (iii) the purchase of fractional interests in shares of any
series of PCS Common Stock pursuant to the conversion or exchange provisions of
any series of PCS Common Stock or the security being converted or exchanged;
(iv) dividends or distributions in any series of PCS Common Stock (or rights to
acquire capital stock) or repurchases, acquisitions or redemptions of any series
of PCS Common Stock in connection with the issuance or exchange of any series of
PCS Common Stock (or securities convertible into or exchangeable for shares of
any series of PCS Common Stock; (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; or (vi) redemptions of PCS Common Stock pursuant to Section 7.1 of the
Company's articles of incorporation.
The Purchase Contracts and all obligations and rights of the
Company and the Holders thereunder, including, without limitation, the rights
and obligations of Holders to purchase PCS 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 Purchase Contract
Settlement 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 Treasury Units
Register. Upon and after the occurrence of a Termination Event, the Collateral
Agent shall release the Treasury Securities from the Pledge in accordance with
the provisions of the Pledge Agreement.
Subject to and upon compliance with the provisions of the
Purchase Contract Agreement, at the option of the Holders thereof, Purchase
Contracts underlying Securities having an aggregate Stated Amount equal to
$1,000 or an integral multiple thereof may be settled early ("Early Settlement")
as provided in the Purchase Contract Agreement. In order to exercise the right
to effect Early Settlement with respect to any Purchase Contracts evidenced by
this Treasury Units Certificate, the Holder of this Treasury Units Certificate
shall deliver this Treasury Units Certificate to the Agent at the Corporate
Trust Office or the New York Office duly endorsed for transfer to the Company or
in blank with the form of Election to Settle Early set forth below duly
completed and
accompanied by payment in the form of immediately available funds payable to the
Company in an amount (the "Early Settlement Amount") equal to the product of (i)
the Stated Amount times (ii) the number of Purchase Contracts with respect to
which the Holder has elected to effect Early Settlement. Upon Early Settlement
of Purchase Contracts by a Holder of the related Securities, the Pledged
Treasury Securities underlying such Securities shall be released from the Pledge
as provided in the Pledge Agreement and the Holder shall be entitled to receive
a number of shares of PCS Common Stock on account of each Purchase Contract
forming part of a Treasury Units as to which Early Settlement is effected equal
to the Early Settlement Rate. The Early Settlement Rate shall initially be equal
to _______ shares of PCS Common Stock and shall be adjusted in the same manner
and at the same time as the Settlement Rate is adjusted as provided in the
Purchase Contract Agreement.
Upon registration of transfer of this Treasury 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, the Pledge Agreement and the Purchase Contracts evidenced
hereby and the transferor shall be released from the obligations under the
Purchase Contract Agreement, the Pledge Agreement and the Purchase Contracts
evidenced by this Treasury 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 Treasury Units Certificate, by its
acceptance hereof, authorizes the Agent to enter into and perform the related
Purchase Contracts forming part of the Treasury 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 its 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 its behalf as its
attorney-in-fact, and consents to the Pledge of the Treasury Securities
underlying this Treasury 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,
Proceeds of the pledged Treasury Securities on the Purchase Contract Settlement
Date shall be paid 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 Proceeds.
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 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 Treasury Units
Certificate is registered as the owner of the Treasury Units evidenced hereby
for the purpose of receiving payments on the Treasury Securities and 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 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 PCS
Common Stock.
A copy of the Purchase Contract Agreement is available for
inspection at the offices of the Agent.
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.
--------------------------------
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 Treasury Units Certificates and all
rights thereunder, hereby irrevocably constituting and
appointing______________________________________________ attorney to transfer
said Treasury Units Certificates on the books of Sprint Corporation 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 Treasury Units Certificates in every
particular, without alteration or enlargement or any change whatsoever.
Signature Guarantee:_________________________________________________ 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.
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares
of PCS Common Stock deliverable upon settlement on or after the Purchase
Contract Settlement Date of the Purchase Contracts underlying the number of
Treasury Units evidenced by this Treasury 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)
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.
If shares are to be registered in the name of and delivered to a Person
other than the Holder, please (i) print such Person's name and address and (ii)
provide a guarantee of your signature:
Name
Address
REGISTERED HOLDER
Social Security or other
Taxpayer Identification
Number, if any
Please print name and address of Registered Holder:
Name
Address
ELECTION TO SETTLE EARLY
The undersigned Holder of this Treasury 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 Treasury Units evidenced by this Treasury
Units Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Treasury 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 PCS 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
Treasury Units Certificate representing any Treasury 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 or
similar tax payable incident thereto.
Dated:________________
-------------------------
Signature
Signature Guarantee: __________________________________
(if assigned to another person)
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.
Number of Securities evidenced hereby as to which Early
Settlement of the related Purchase Contracts is being elected:
If shares of PCS Common Stock or Treasury Units Certificates
are to be registered in the name of and delivered to and pledged Treasury
Securities are to be transferred to a Person other than the Holder, please (i)
print such Person's name and address and (ii) provide a guarantee of your
signature:
Name
Address
Name
Address
Social Security or other
Taxpayer Identification
Number, if any
Please print name and address of Registered Holder:
Name
Address
Transfer Instructions for
pledged Treasury Securities
Upon Early Settlement or
a Termination Event:
[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:
Signature of
Stated Amount of this authorized signatory
Amount of decrease in Amount of increase in Global Certificate of Purchase Contract
Stated Amount of the Stated Amount of the following such Agent or Securities
Date Global Certificate Global Certificate decrease or increase Custodian
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EXHIBIT C
INSTRUCTION FROM PURCHASE CONTRACT AGENT TO COLLATERAL AGENT
[Collateral Agent Address]
Re: Equity Units of Sprint Corporation (the "Company")
We hereby notify you in accordance with Section [4.1] [4.2] of the
Pledge Agreement, dated as of _________, 2001, (the "Pledge Agreement") among
the Company, yourselves, as Collateral Agent, Custodial Agent and Securities
Intermediary and ourselves, as Purchase Contract Agent and as attorney-in-fact
for the holders of [Corporate Units] [Treasury Units] from time to time, that
the holder of the Securities listed below (the "Holder") has elected to
substitute [$_____ aggregate principal amount of Treasury Securities] [$_______
aggregate principal amount of Notes or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be,] in exchange for an
equal value of [Pledged Notes or the appropriate Applicable Ownership Interest
of the Treasury Portfolio, as the case may be,] [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 Applicable Ownership Interest of 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 or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,],
and upon the payment by such Holder of any applicable fees, to release the
[Notes or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be,] [Treasury Securities] related to such [Corporate
Units] [Treasury Units] to us in accordance with the Holder's instructions.
Capitalized terms used herein but not defined shall have the meaning set forth
in the Pledge Agreement.
Date:_____________
By:______________________
Name:
Title:
Signature Guarantee:_____________
Please print name and address of Registered Holder electing to substitute
[Treasury Securities] [Notes or the appropriate Applicable Ownership Interest of
the Treasury Portfolio, as the case may be,] for the [Pledged Notes or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be,] [Pledged Treasury Securities]:
____________________________
Name Social Security or other
Taxpayer Identification
Number, if any
Address
EXHIBIT D
INSTRUCTION TO PURCHASE CONTRACT AGENT
Bank One, National Association
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Mail Code OH1-0181
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Attention: Global Corporate Trust Services Division
Re: Equity Units of Sprint Corporation (the "Company")
The undersigned Holder hereby notifies you that it has
delivered to , as Collateral Agent, [$_______ aggregate principal amount of
Treasury Securities] [$ aggregate principal amount of Notes or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,] in
exchange for an equal Value of [Pledged Notes or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be,] [Pledged
Treasury Securities] held by the Collateral Agent, in accordance with Section
[4.1], [4.2] of the Pledge Agreement, dated February __, 2001 (the "Pledge
Agreement"), between 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
or the appropriate Applicable Ownership Interest of the Treasury Portfolio]
[Pledged Treasury Securities] related to such [Corporate Units] [Treasury
Units]. Capitalized terms used herein but not defined shall have the meaning set
forth in the Pledge Agreement.
Dated: ________ __________________________
Signature
Signature Guarantee: ______________
Please print name and address of Registered Holder:
______________________________
Name Social Security or other
Taxpayer Identification
Number, if any
Address
EXHIBIT E
NOTICE TO SETTLE BY SEPARATE CASH
Bank One, National Association
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Mail Code OH1-0181
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Attention: Global Corporate Trust Services Division
Re: Equity Units of Sprint Corporation (the "Company")
The undersigned Holder hereby irrevocably notifies you in accordance
with Section 5.6 of the Purchase Contract Agreement dated as of __________, 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 Purchase Contract Settlement
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 PCS Common Stock issuable to such Holder by the
Company under the related Purchase Contract on the Purchase Contract Settlement
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
[Corporate Units] [Treasury Units].
Dated:_____________
__________________________________
Signature
Signature Guarantee:______________
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:
__________________________________________________________________
Name Social Security or other
Identification Number,
if any
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Address
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