CAPITAL ONE FINANCIAL CORPORATION,
BNY MIDWEST TRUST COMPANY,
as Collateral Agent, Custodial Agent
and Securities Intermediary
AND
BNY MIDWEST TRUST COMPANY
as Forward Purchase Contract Agent
PLEDGE AGREEMENT
Dated as of April 23, 2002
TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions........................................................................2
ARTICLE II
PLEDGE; CONTROL AND PERFECTION
SECTION 2.1 The Pledge.........................................................................4
SECTION 2.2 Control and Perfection.............................................................6
ARTICLE III
PAYMENTS ON PLEDGED COLLATERAL
SECTION 3.1 Payments...........................................................................8
SECTION 3.2 Application of Payments............................................................9
ARTICLE IV
SUBSTITUTION, RELEASE, REPLEDGE AND SETTLEMENT OF NOTES
SECTION 4.1 Collateral Substitution and the Creation of Stripped DECS.........................10
SECTION 4.2 Collateral Substitution and the Re-Creation of Upper DECS.........................11
SECTION 4.3 Termination Event.................................................................11
SECTION 4.4 Early Settlement; Merger Early Settlement; Cash Settlement........................12
SECTION 4.5 Remarketing; Application of Proceeds; Settlement..................................13
ARTICLE V
VOTING RIGHTS -- NOTES
SECTION 5.1 Exercise by Forward Purchase Contract Agent.......................................16
ARTICLE VI
RIGHTS AND REMEDIES; TAX EVENT REDEMPTION
SECTION 6.1 Rights and Remedies of the Collateral Agent.......................................16
SECTION 6.2 Substitutions.....................................................................18
SECTION 6.3 Tax Event Redemption..............................................................18
ARTICLE VII
REPRESENTATIONS AND WARRANTIES; COVENANTS
SECTION 7.1 Representations and Warranties....................................................18
SECTION 7.2 Covenants.........................................................................19
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ARTICLE VIII
THE COLLATERAL AGENT
SECTION 8.1 Appointment, Powers and Immunities................................................19
SECTION 8.2 Instructions of the Company.......................................................21
SECTION 8.3 Reliance..........................................................................21
SECTION 8.4 Rights in Other Capacities........................................................22
SECTION 8.5 Non-Reliance on Collateral Agent..................................................22
SECTION 8.6 Compensation and Indemnity........................................................22
SECTION 8.7 Failure to Act....................................................................23
SECTION 8.8 Resignation.......................................................................24
SECTION 8.9 Right to Appoint Agent or Advisor.................................................25
SECTION 8.10 Survival..........................................................................25
SECTION 8.11 Exculpation.......................................................................25
ARTICLE IX
AMENDMENT
SECTION 9.1 Amendment Without Consent of Holders..............................................25
SECTION 9.2 Amendment with Consent of Holders.................................................26
SECTION 9.3 Execution of Amendments...........................................................27
SECTION 9.4 Effect of Amendments..............................................................27
SECTION 9.5 Reference to Amendments...........................................................27
ARTICLE X
MISCELLANEOUS
SECTION 10.1 No Waiver.........................................................................28
SECTION 10.2 GOVERNING LAW.....................................................................28
SECTION 10.3 Notices...........................................................................28
SECTION 10.4 Successors and Assigns............................................................29
SECTION 10.5 Counterparts......................................................................29
SECTION 10.6 Severability......................................................................29
SECTION 10.7 Expenses, Etc.....................................................................29
SECTION 10.8 Security Interest Absolute........................................................30
SECTION 10.9 Waiver of Jury Trial..............................................................30
EXHIBIT A Instruction from Forward Purchase Contract Agent to Collateral Agent
EXHIBIT B Instruction to Forward Purchase Contract Agent
EXHIBIT C Instruction to Custodial Agent Regarding Remarketing
EXHIBIT D Instruction to Custodial Agent Regarding Withdrawal from Remarketing
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PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of April 23, 2002 (this "Agreement"), among
Capital One Financial Corporation, a Delaware corporation (the "Company"), BNY
Midwest Trust Company, an Illinois trust company, not individually but solely as
collateral agent (in such capacity, together with its successors in such
capacity, the "Collateral Agent"), as custodial agent (in such capacity,
together with its successors in such capacity, the "Custodial Agent") and as
"securities intermediary" as defined in Section 8-102(a)(14) of the Code (as
defined herein) (in such capacity, together with its successors in such
capacity, the "Securities Intermediary"), and BNY Midwest Trust Company, not
individually but solely as forward purchase contract agent and as
attorney-in-fact of the Holders from time to time of the DECS (in such capacity,
together with its successors in such capacity, the "Forward Purchase Contract
Agent") under the Forward Purchase Contract Agreement (as defined herein).
RECITALS
WHEREAS, the Company and the Forward Purchase Contract Agent are
parties to the Forward Purchase Contract Agreement, dated as of the date hereof
(as modified and supplemented and in effect from time to time, the "Forward
Purchase Contract Agreement"), pursuant to which there may be issued DECS having
a Stated Amount of $50 per DECS, all of which will initially be Upper DECS.
WHEREAS, each Upper DECS will be comprised of (a) a Forward Purchase
Contract and (b) either beneficial ownership of (i) a Note, (ii) following the
successful remarketing of the Notes in accordance with the Forward Purchase
Contract Agreement and the Remarketing Agreement, the appropriate Treasury
Consideration or (iii) following a Tax Event Redemption in accordance with the
Forward Purchase Contract Agreement, an Applicable Ownership Interest in the
Treasury Portfolio.
WHEREAS, in accordance with the terms of the Forward Purchase Contract
Agreement, a Holder of Upper DECS may separate the Notes or the appropriate
Treasury Consideration or Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, from the related Forward Purchase Contracts by
substituting for such Notes or appropriate Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, Treasury
Securities that will pay in the aggregate an amount equal to the amount due on
the Scheduled Stock Purchase Date under such Forward Purchase Contracts. Upon
such separation, the Upper DECS will become Stripped DECS. Each Stripped DECS
will be comprised of (a) a Forward Purchase Contract and (b) a 1/20 undivided
beneficial interest in a Treasury Security.
WHEREAS, pursuant to the terms of the Forward Purchase Contract
Agreement and the Forward Purchase Contracts, the Holders, from time to time, of
the DECS have irrevocably authorized the Forward Purchase Contract Agent, as
attorney-in-fact of such Holders, among other things, to execute and deliver
this Agreement on behalf of such Holders and to grant the pledge provided hereby
of the Notes, any Treasury
Consideration, any Treasury Securities and any Applicable Ownership Interest in
the Treasury Portfolio delivered in exchange therefor to secure each Holder's
obligations under the related Forward Purchase Contracts, as provided herein and
subject to the terms hereof.
NOW, THEREFORE, the Company, the Collateral Agent, the Securities
Intermediary, the Custodial Agent and the Forward Purchase Contract Agent, on
its own behalf and as attorney-in-fact of the Holders from time to time of the
DECS, agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions.
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) capitalized terms used but not defined herein are used as defined
in the Forward Purchase Contract Agreement;
(b) the defined terms in this Agreement have the meanings assigned to
them in this Article and include the plural as well as the singular; and
(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.
"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.
"Code" has the meaning specified in Section 6.1(a) hereof.
"Collateral" has the meaning specified in Section 2.1(a) hereof.
"Collateral Account" means the securities account (number 062121)
maintained at BNY Midwest Trust Company in the name "BNY Midwest Trust Company,
an Illinois trust company, as Forward Purchase Contract Agent on behalf of the
holders of certain securities of
Capital One Financial Corporation, Collateral
Account subject to the security interest of BNY Midwest Trust Company, as
Collateral Agent, for the benefit of
Capital One Financial Corporation, as
pledgee" and any successor account.
"Collateral Agent" has the meaning specified in the first paragraph of
this Agreement.
"Company" means the Person named as the "Company" in the first
paragraph of this Agreement until a successor shall have become such pursuant to
the applicable
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provisions of the Forward Purchase Contract Agreement, and thereafter "Company"
shall mean such successor.
"Custodial Agent" has the meaning specified in the first paragraph of
this Agreement.
"Forward Purchase Contract Agent" has the meaning specified in the
first paragraph of this Agreement.
"Forward Purchase Contract Agreement" has the meaning specified in the
Recitals.
"Intermediary" means any entity that in the ordinary course of its
business maintains securities accounts for others and is acting in that
capacity.
"Opt-Out Notice" means that contingent election by notice made by
Holders to the Forward Purchase Contract Agent on or prior to the third Business
Day prior to a Stock Purchase Date whereby such Holders elect not to sell their
Notes to the Company in the event a Last Failed Remarketing or Last Failed
Accelerated Remarketing occurs, pursuant to Section 206 of the First
Supplemental Indenture, dated the date hereof between the Company and the
Trustee.
"Pledge" has the meaning specified in Section 2.1(c) hereof.
"Pledged Applicable Ownership Interest in the Treasury Portfolio" has
the meaning specified in Section 2.1(c) hereof.
"Pledged Notes" has the meaning specified in Section 2.1(c) hereof.
"Pledged Treasury Consideration" has the meaning specified in Section
2.1(c) hereof.
"Pledged Treasury Securities" has the meaning specified in Section
2.1(c) hereof.
"Proceeds" means all interest, dividends, cash, instruments,
securities, financial assets (as defined in Section 8-102(a)(9) of the Code) and
other property from time to time received, receivable or otherwise distributed
upon the sale, exchange, collection or disposition of the Collateral or any
proceeds thereof.
"Securities Intermediary" has the meaning specified in the first
paragraph of this Agreement.
"Security Entitlement" has the meaning specified in Section
8-102(a)(17) of the Code.
"Separate Notes" means any Notes that are not Pledged Notes.
"Supplemental Indenture" means a supplemental indenture dated as of
April 23, 2002, between the Company and BNY Midwest Trust Company, as successor
to ▇▇▇▇▇▇
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Trust and Savings Bank, as trustee (the "Trustee"), to the indenture dated as of
November 1, 1996, between the Company and the Trustee.
"Tax Event Redemption Date" means the date upon which a Tax Event
Redemption is to occur.
"TRADES Regulations" means the regulations of the United States
Department of the Treasury, published at 31 C.F.R. Part 357, as amended from
time to time. Unless otherwise defined herein, all terms defined in the TRADES
Regulations are used herein as therein defined.
"Transfer" means, with respect to the Collateral and in accordance with
the instructions of the Collateral Agent, the Forward Purchase Contract Agent or
the Holder, as applicable:
(i) in the case of Collateral consisting of securities which
cannot be delivered by book-entry or which the parties agree are to be
delivered in physical form, delivery in appropriate physical form to
the recipient accompanied by any duly executed instruments of transfer,
assignments in blank, transfer tax stamps and any other documents
necessary to constitute a legally valid transfer to the recipient;
(ii) in the case of Collateral consisting of securities
maintained in book-entry form, delivery by causing a "securities
intermediary" (as defined in Section 8-102(a)(14) of the Code) to (a)
credit a "security entitlement" (as defined in Section 8-102(a)(17) of
the Code) with respect to such securities to a "securities account" (as
defined in Section 8-501(a) of the Code) maintained by or on behalf of
the recipient and (b) to issue a confirmation to the recipient with
respect to such credit. In the case of Collateral to be delivered to
the Collateral Agent, the securities intermediary shall be the
Securities Intermediary and the securities account shall be the
Collateral Account. In addition, any Transfer of Treasury Securities
and Treasury Consideration hereunder shall be made in accordance with
the TRADES Regulations and other applicable law.
ARTICLE II
PLEDGE; CONTROL AND PERFECTION
SECTION 2.1 The Pledge.
(a) The Holders from time to time acting through the Forward Purchase
Contract Agent, as their attorney-in-fact, and the Forward Purchase Contract
Agent, as such attorney-in-fact, hereby pledge and grant to the Collateral
Agent, for the benefit of the Company, as collateral security for the
performance when due by such Holders of their respective obligations under the
related Forward Purchase Contracts, a security interest in
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all of the right, title and interest of the Forward Purchase Contract Agent and
such Holders in:
(i) (A) the Notes, Treasury Consideration, Treasury Securities
and any Applicable Ownership Interest in the Treasury Portfolio
constituting a part of the DECS, (B) any Treasury Securities delivered
in exchange for any Notes, Treasury Consideration or Applicable
Ownership Interest in the Treasury Portfolio, as applicable, in
accordance with Section 4.1 hereof, and (C) any Notes, Treasury
Consideration or Applicable Ownership Interest in the Treasury
Portfolio, as applicable, delivered in exchange for any Treasury
Securities in accordance with Section 4.2 hereof, in each case that
have been Transferred to or otherwise received by the Collateral Agent
and not released by the Collateral Agent to such Holders under the
provisions of this Agreement;
(ii) the Collateral Account and all securities, financial
assets, security entitlements, cash and other property credited thereto
and all Security Entitlements related thereto; and
(iii) all Proceeds of the foregoing (all of the foregoing,
collectively, the "Collateral").
(b) Prior to or concurrently with the execution and delivery of this
Agreement, the Forward Purchase Contract Agent, on behalf of the initial Holders
of the DECS, shall cause the Notes comprising a part of the Upper DECS to be
Transferred to the Collateral Agent for the benefit of the Company.
(c) The pledge provided in this Section 2.1 is herein referred to as
the "Pledge" and the Notes (or the Notes that are delivered pursuant to Section
4.2 hereof), Treasury Consideration, Treasury Securities or Applicable Ownership
Interest in the Treasury Portfolio subject to the Pledge, excluding any Notes,
Treasury Consideration, Treasury Securities or Applicable Ownership Interest in
the Treasury Portfolio released from the Pledge as provided in Sections 4.1 and
4.2 hereof, respectively, are herein referred to as "Pledged Notes," "Pledged
Treasury Consideration," "Pledged Treasury Securities" or "Pledged Applicable
Ownership Interest in the Treasury Portfolio," respectively. Subject to the
Pledge and Section 2.2 hereof, the Holders from time to time shall have full
beneficial ownership of the Collateral. For purposes of perfecting the Pledge
under applicable law, including, to the extent applicable, the TRADES
Regulations or the Uniform Commercial Code as adopted and in effect in any
applicable jurisdiction, the Collateral Agent shall be the agent of the Company
as provided herein. Whenever directed by the Collateral Agent acting on behalf
of the Company, the Securities Intermediary shall have the right to reregister
in its name the Notes or any other securities held in physical form.
(d) Except as may be required in order to release Notes or Treasury
Consideration, as applicable, in connection with a Tax Event Redemption or with
a Holder's election to convert an Upper DECS to a Stripped DECS, or except as
otherwise
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required to release Notes as specified herein, neither the Collateral Agent, the
Custodial Agent nor the Securities Intermediary shall relinquish physical
possession of any certificate evidencing a Note prior to the termination of this
Agreement. If it becomes necessary for the Securities Intermediary to relinquish
physical possession of a certificate in order to release a portion of the Notes
evidenced thereby from the Pledge, the Company or the Forward Purchase Contract
Agent shall use its commercially reasonable best efforts to arrange for the
Securities Intermediary to obtain physical possession of a replacement
certificate evidencing any Notes remaining subject to the Pledge hereunder
registered to the Securities Intermediary or endorsed in blank within fifteen
days of the date the Securities Intermediary relinquished possession. The
Securities Intermediary shall promptly notify the Company and the Collateral
Agent of the Securities Intermediary's failure to obtain possession of any such
replacement certificate as required hereby.
SECTION 2.2 Control and Perfection.
(a) In connection with the Pledge granted in Section 2.1, and subject
to the other provisions of this Agreement, the Holders from time to time acting
through the Forward Purchase Contract Agent, as their attorney-in-fact, hereby
authorize and direct the Securities Intermediary (without the necessity of
obtaining the further consent of the Forward Purchase Contract Agent or any of
the Holders), and the Securities Intermediary agrees, to comply with and follow
any instructions and entitlement orders (as defined in Section 8-102(a)(8) of
the Code) that the Collateral Agent may deliver with respect to the Collateral
Account, the Collateral credited thereto and any Security Entitlements with
respect thereto. In the event the Securities Intermediary receives from the
Holders or the Forward Purchase Contract Agent entitlement orders which conflict
with entitlement orders received from the Collateral Agent, the Securities
Intermediary shall follow the entitlement orders received from the Collateral
Agent. Such instructions and entitlement orders may, without limitation, direct
the Securities Intermediary to transfer, redeem, assign, or otherwise deliver
the Notes, the Treasury Consideration, the Treasury Securities, any Applicable
Ownership Interest in the Treasury Portfolio and any Security Entitlements with
respect thereto or sell, liquidate or dispose of such assets through a broker
designated by the Company, and to pay and deliver any income, proceeds or other
funds derived therefrom to the Company. The Holders from time to time acting
through the Forward Purchase Contract Agent hereby further authorize and direct
the Collateral Agent itself, as agent of the Company, to issue instructions and
entitlement orders, and to otherwise take action, with respect to the Collateral
Account, the Collateral credited thereto and any Security Entitlements with
respect thereto, pursuant to the terms and provisions hereof, all without the
necessity of obtaining the further consent of the Forward Purchase Contract
Agent or any of the Holders. The Collateral Agent shall be the agent of the
Company and shall act only in accordance with the terms hereof or as otherwise
directed in writing by the Company. Without limiting the generality of the
foregoing, the Collateral Agent shall issue entitlement orders to the Securities
Intermediary as directed in writing by the Company.
(b) The Securities Intermediary hereby confirms and agrees that:
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(i) all securities or other property underlying any financial
assets credited to the Collateral Account shall be registered in the
name of the Securities Intermediary, or its nominee, endorsed to the
Securities Intermediary, or its nominee, or in blank and in no case
will any financial asset credited to the Collateral Account be
registered in the name of the Forward Purchase Contract Agent, the
Collateral Agent as such, the Company or any Holder, payable to the
order of, or specially endorsed to, the Forward Purchase Contract
Agent, the Collateral Agent as such, the Company or any Holder except
to the extent the foregoing have been specially endorsed to the
Securities Intermediary or in blank;
(ii) all property delivered to the Securities Intermediary
pursuant to this Agreement (including, without limitation, any Notes,
Treasury Consideration, Treasury Securities or Applicable Ownership
Interest in the Treasury Portfolio) will be promptly credited to the
Collateral Account;
(iii) the Collateral Account is an account to which financial
assets are or may be credited, and the Securities Intermediary shall,
subject to the terms of this Agreement, treat the Forward Purchase
Contract Agent as entitled to exercise the rights of any financial
asset credited to the Collateral Account;
(iv) the Securities Intermediary has not entered into, and
until the termination of this Agreement will not enter into, any
agreement with any other Person relating to the Collateral Account
and/or any financial assets credited thereto pursuant to which it has
agreed to comply with entitlement orders (as defined in Section
8-102(a)(8) of the Code) of such other Person;
(v) the Securities Intermediary has not entered into, and
until the termination of this Agreement will not enter into, any
agreement with the Company, the Collateral Agent or the Forward
Purchase Contract Agent purporting to limit or condition the obligation
of the Securities Intermediary to comply with entitlement orders as set
forth in this Section 2.2;
(vi) each item of property (whether investment property,
financial asset, security, instrument or cash) credited to the
Collateral Account shall be treated as a "financial asset" within the
meaning of Section 8-102(a)(9) of the Code; and
(vii) in the event of any conflict between this Agreement (or
any portion thereof) and any other agreement now existing or hereafter
entered into, the terms of this Agreement shall prevail.
(c) The Forward Purchase Contract Agent hereby irrevocably constitutes
and appoints the Collateral Agent and the Company, with full power of
substitution, as the Forward Purchase Contract Agent's attorney-in-fact to take
on behalf of, and in the name, place and stead of, the Forward Purchase Contract
Agent and the Holders, any action necessary or desirable to perfect and to keep
perfected the security interest in the Collateral referred to in Section 2.1.
The grant of such power-of-attorney shall not be
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deemed to require of the Collateral Agent any specific duties or obligations not
otherwise assumed by the Collateral Agent hereunder. Notwithstanding the
foregoing, in no event shall the Collateral Agent or Securities Intermediary be
responsible for the preparation or filing of any financing or continuation
statements in the appropriate jurisdictions or responsible for maintenance or
perfection of any security interest hereunder.
ARTICLE III
PAYMENTS ON PLEDGED COLLATERAL
SECTION 3.1 Payments.
So long as the Forward Purchase Contract Agent is the registered owner
of the Pledged Notes, Pledged Treasury Consideration, Pledged Applicable
Ownership Interest in the Treasury Portfolio or Pledged Treasury Securities, it
shall receive all payments thereon. If the Pledged Notes are reregistered, such
that the Collateral Agent becomes the registered holder, all payments of the
principal of, or interest or other amounts on, the Pledged Notes and all
payments of the principal of, or cash distributions on, any Pledged Treasury
Consideration, Pledged Treasury Securities or Pledged Applicable Ownership
Interest in the Treasury Portfolio that are received by the Collateral Agent and
that are properly payable hereunder, shall be paid by the Collateral Agent by
wire transfer in same day funds:
(i) in the case of (A) any interest payments with respect to
the Pledged Notes, the Pledged Treasury Consideration or the
appropriate Pledged Applicable Ownership Interest in the Treasury
Portfolio (as specified in clause (B) of the definition of Applicable
Ownership Interest), as the case may be, with respect to Upper DECS
which include Pledged Notes, Pledged Treasury Consideration or the
appropriate Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, and (B) any payments of principal or, if
applicable, the appropriate Applicable Ownership Interest in the
Treasury Portfolio (as specified in clause (A) of the definition of
Applicable Ownership Interest) with respect to any Notes, Treasury
Consideration or the appropriate Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, that have been released from
the Pledge pursuant to Section 4.3 hereof, to the Forward Purchase
Contract Agent, for the benefit of the relevant Holders of the Upper
DECS, to the account designated by the Forward Purchase Contract Agent
for such purpose, no later than 10:00 a.m.,
New York City time, on the
Business Day such payment is received by the Collateral Agent (provided
that in the event such payment is received by the Collateral Agent on a
day that is not a Business Day or after 9:00 a.m.,
New York City time,
on a Business Day, then such payment shall be made no later than 9:30
a.m.,
New York City time, on the next succeeding Business Day);
(ii) in the case of any payments with respect to any Treasury
Securities that have been released from the Pledge pursuant to Section
4.3 hereof, to the
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Holders of the Stripped DECS 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 10 a.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);
(iii) in the case of payments in respect of any Pledged Notes,
Pledged Treasury Consideration, Pledged Treasury Securities or the
appropriate Pledged Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) in the Treasury Portfolio,
as the case may be, to be paid upon settlement of the Holders'
obligations to purchase Common Stock under the Forward Purchase
Contract, to the Company on any Stock Purchase Date in accordance with
the procedure set forth in Section 4.5(a) or 4.5(b) hereof, in full
satisfaction of the respective obligations of the Holders under the
related Forward Purchase Contracts; and
(iv) in the case of payments in respect of any Pledged Notes
to be paid upon a repurchase by the Company of the Pledged Notes upon
the occurrence of a Last Failed Remarketing or Last Failed Accelerated
Remarketing in accordance with Sections 5.2(e)(ii) and 5.9 of the
Forward Purchase Contract Agreement, to the Forward Purchase Contract
Agent, for the benefit of the relevant Holders of the Upper DECS, to
the account designated by the Forward Purchase Contract Agent for such
purpose, no later than 10:00 a.m.,
New York City time, on the Business
Day such payment is received by the Collateral Agent (provided that in
the event such payment is received by the Collateral Agent on a day
that is not a Business Day or after 9:00 a.m.,
New York City time, on a
Business Day, then such payment shall be made no later than 9:30 a.m.,
New York City time, on the next succeeding Business Day).
SECTION 3.2 Application of Payments.
All payments received by the Forward Purchase Contract Agent as
provided herein shall be applied by the Forward Purchase Contract Agent pursuant
to the provisions of the Forward Purchase Contract Agreement. If,
notwithstanding the foregoing, the Forward Purchase Contract Agent shall receive
any payments of principal on account of any Note, Treasury Consideration or the
appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) in the Treasury Portfolio, as applicable, that, at the
time of such payment, is a Pledged Note, Pledged Treasury Consideration or
Pledged Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) in the Treasury Portfolio, as the case may be, or a
Holder of a Stripped DECS shall receive any payments of principal on account of
any Treasury Securities that, at the time of such payment, are Pledged Treasury
Securities, the Forward Purchase Contract Agent or such Holder shall hold the
same as trustee of an express trust for the benefit of the Company (and promptly
deliver the same over to the
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Company) for application to the obligations of the Holders under the related
Forward Purchase Contracts, and the Holders shall acquire no right, title or
interest in any such payments of principal so received.
ARTICLE IV
SUBSTITUTION, RELEASE, REPLEDGE AND SETTLEMENT OF NOTES
SECTION 4.1 Collateral Substitution and the Creation of Stripped DECS.
At any time on or prior to the second Business Day immediately
preceding a Stock Purchase Date, a Holder of Upper DECS shall have the right to
substitute Treasury Securities for the Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, securing such Holder's obligations under the
Forward Purchase Contracts comprising a part of such Upper DECS, in integral
multiples of 20 Upper DECS, or after a successful remarketing of the Notes
pursuant to the Forward Purchase Contract Agreement or a Tax Event Redemption,
in integral multiples of Upper DECS such that the Treasury Securities to be
deposited and the applicable Treasury Consideration or Applicable Ownership
Interest in the Treasury Portfolio to be released are in integral multiples of
$1,000, by (a) Transferring to the Collateral Agent Treasury Securities having
an aggregate principal amount equal to the aggregate Stated Amount of such Upper
DECS and (b) delivering such Upper DECS to the Forward Purchase Contract Agent,
accompanied by a notice, substantially in the form of Exhibit B hereto, to the
Forward Purchase Contract Agent stating that such Holder has Transferred
Treasury Securities to the Collateral Agent pursuant to clause (a) above
(stating the principal amount and the CUSIP numbers of the Treasury Securities
Transferred by such Holder) and requesting that the Forward Purchase Contract
Agent instruct the Collateral Agent to release from the Pledge the Pledged
Notes, Pledged Treasury Consideration or Pledged Applicable Ownership Interest
in the Treasury Portfolio, as the case may be, related to such Upper DECS,
whereupon the Forward Purchase Contract Agent shall promptly give such
instruction in writing to the Collateral Agent in the form provided in Exhibit
A; provided that such Holder may not substitute such Treasury Securities for
such Pledged Notes, Pledged Treasury Consideration or Pledged Applicable
Ownership Interest in the Treasury Portfolio pursuant to this Section 4.1 during
the period from four Business Days prior to any Remarketing Period until the
expiration of three Business Days after the end of such Remarketing Period. Upon
receipt of Treasury Securities from a Holder of Upper DECS and the related
written instruction from the Forward Purchase Contract Agent, the Collateral
Agent shall release the Pledged Notes, Pledged Treasury Consideration or Pledged
Applicable Ownership Interest in the Treasury Portfolio, as the case may be, and
shall promptly Transfer such Pledged Notes, Pledged Treasury Consideration or
Pledged Applicable Ownership Interest in the Treasury Portfolio, as the case may
be, free and clear of any lien, pledge or security interest created hereby, to
the Forward Purchase Contract Agent. All items Transferred and/or substituted by
any Holder pursuant to this Section 4.1, Section 4.2 or any other Section of
this Agreement shall be Transferred and/or substituted free and clear of all
liens, claims and encumbrances.
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SECTION 4.2 Collateral Substitution and the Re-Creation of Upper DECS.
At any time on or prior to the second Business Day immediately
preceding a Stock Purchase Date, a Holder of Stripped DECS shall have the right
to reestablish Upper DECS (a) consisting of the Forward Purchase Contracts and
Notes in integral multiples of 20 Upper DECS, or (b) after a successful
remarketing of the Notes pursuant to the Forward Purchase Contract Agreement or
a Tax Event Redemption, consisting of the Forward Purchase Contracts and the
appropriate Treasury Consideration (identified and calculated by reference to
the Treasury Consideration then comprising Upper DECS) or the appropriate
portion of the Treasury Portfolio in integral multiples of Stripped DECS such
that the Treasury Consideration or Applicable Ownership Interest in the Treasury
Portfolio to be deposited and the Treasury Securities to be released are in
integral multiples of $1,000, by (x) Transferring to the Collateral Agent Notes
or the appropriate Treasury Consideration or the Applicable Ownership Interest
in the Treasury Portfolio, as the case may be, then comprising such number of
Upper DECS as is equal to the aggregate stated amount of Stripped DECS and (y)
delivering such Stripped DECS to the Forward Purchase Contract Agent,
accompanied by a notice, substantially in the form of Exhibit B hereto, to the
Forward Purchase Contract Agent stating that such Holder has transferred Notes,
Treasury Consideration or Applicable Ownership Interest in the Treasury
Portfolio to the Collateral Agent pursuant to clause (x) above and requesting
that the Forward Purchase Contract Agent instruct the Collateral Agent to
release from the Pledge the Pledged Treasury Securities related to such Stripped
DECS, whereupon the Forward Purchase Contract Agent shall give such instruction
to the Collateral Agent in the form provided in Exhibit A; provided that such
Holder of Stripped DECS shall not have the right to reestablish Upper DECS
pursuant to this Section 4.2 during the period from four Business Days prior to
any Remarketing Period until the expiration of three Business Days after the end
of such Remarketing Period. Upon receipt of the Notes or the appropriate
Treasury Consideration or Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, from such Holder and the instruction from the
Forward Purchase Contract Agent, the Collateral Agent shall release the Pledged
Treasury Securities and shall promptly Transfer such Pledged Treasury
Securities, free and clear of any lien, pledge or security interest created
hereby, to the Forward Purchase Contract Agent.
SECTION 4.3 Termination Event.
(a) Upon receipt by the Collateral Agent of written notice from the
Company or the Forward Purchase Contract Agent that there has occurred a
Termination Event, the Collateral Agent shall release all Collateral from the
Pledge and shall promptly Transfer any Pledged Notes, Pledged Treasury
Consideration or Pledged Applicable Ownership Interest in the Treasury
Portfolio, as the case may be, and Pledged Treasury Securities to the Forward
Purchase Contract Agent for the benefit of the Holders of the Upper DECS and the
Stripped DECS, respectively, free and clear of any lien, pledge or security
interest or other interest created hereby.
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(b) If such Termination Event shall result from the Company's becoming
a debtor under the Bankruptcy Code, and if the Collateral Agent shall for any
reason fail promptly to effectuate the release and Transfer of all Pledged
Notes, Pledged Treasury Consideration, Pledged Applicable Ownership Interest in
the Treasury Portfolio, or Pledged Treasury Securities, as the case may be, as
provided by this Section 4.3, the Forward Purchase Contract Agent shall:
(i) use its best efforts to obtain, at the expense of the
Company, an opinion of a nationally recognized law firm reasonably
acceptable to the Collateral Agent to the effect that, as a result of
the Company's being the debtor in such a bankruptcy case, the
Collateral Agent will not be prohibited from releasing or Transferring
the Collateral as provided in this Section 4.3, and shall deliver such
opinion to the Collateral Agent within ten days after the occurrence of
such Termination Event, and if (y) the Forward Purchase Contract Agent
shall be unable to obtain such opinion within ten days after the
occurrence of such Termination Event or (z) the Collateral Agent shall
continue, after delivery of such opinion, to refuse to effectuate the
release and Transfer of all Pledged Notes, Pledged Treasury
Consideration, Pledged Applicable Ownership Interest in the Treasury
Portfolio or Pledged Treasury Securities, as the case may be, as
provided in this Section 4.3, then the Forward Purchase Contract Agent
shall within fifteen days after the occurrence of such Termination
Event commence an action or proceeding in the court with jurisdiction
of the Company's case under the Bankruptcy Code seeking an order
requiring the Collateral Agent to effectuate the release and Transfer
of all Pledged Notes, Pledged Treasury Consideration, Pledged
Applicable Ownership Interest in the Treasury Portfolio or Pledged
Treasury Securities, as the case may be, as provided by this Section
4.3 or
(ii) commence an action or proceeding like that described in
subsection (i)(z) hereof within ten days after the occurrence of such
Termination Event.
SECTION 4.4 Early Settlement; Merger Early Settlement; Cash Settlement.
Upon written notice to the Collateral Agent by the Forward Purchase
Contract Agent that one or more Holders of DECS have elected to effect Early
Settlement, Merger Early Settlement or Cash Settlement of their respective
obligations under the Forward Purchase Contracts forming a part of such DECS in
accordance with the terms of the Forward Purchase Contracts and the Forward
Purchase Contract Agreement (setting forth the number of such Forward Purchase
Contracts as to which such Holders have elected to effect Early Settlement,
Merger Early Settlement or Cash Settlement), and that the Forward Purchase
Contract Agent has received from such Holders, and paid to the Company, as
confirmed to the Collateral Agent in writing by the Company, the related Early
Settlement Amounts, Merger Early Settlement Amounts or Cash Settlement Amounts,
as the case may be, pursuant to the terms of the Forward Purchase Contracts and
the Forward Purchase Contract Agreement and that all conditions to such Early
Settlement, Merger Early Settlement or Cash Settlement, as the case may be, have
been
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satisfied, then the Collateral Agent shall release from the Pledge (a) Pledged
Notes, Pledged Treasury Consideration or Pledged Applicable Ownership Interest
in the Treasury Portfolio, as the case may be, in the case of a Holder of Upper
DECS or (b) Pledged Treasury Securities, in the case of a Holder of Stripped
DECS, relating to such Forward Purchase Contracts as to which such Holders have
elected to effect Early Settlement, Merger Early Settlement or Cash Settlement,
and shall Transfer all such Pledged Notes, Pledged Treasury Consideration,
Pledged Applicable Ownership Interest in the Treasury Portfolio or Pledged
Treasury Securities, as the case may be, free and clear of the Pledge created
hereby, to the Forward Purchase Contract Agent for the benefit of such Holders.
SECTION 4.5 Remarketing; Application of Proceeds; Settlement.
(a) Pursuant to the Forward Purchase Contract Agreement, the Forward
Purchase Contract Agent shall notify, by 10:00 a.m.,
New York City time, on the
third Business Day preceding the Remarketing Date, Accelerated Remarketing Date
or the first day of any subsequent Remarketing Period, as the case may be, the
Remarketing Agent and the Collateral Agent of the aggregate number of Notes
comprising part of Upper DECS to be remarketed. The Collateral Agent shall, by
10:00 a.m., New York City time, on the third Business Day immediately preceding
the Remarketing Date, any Accelerated Remarketing Date or the first day of any
subsequent Remarketing Period, as the case may be, without any instruction from
Holders of Upper DECS, Transfer the Pledged Notes to be remarketed to the
Remarketing Agent for remarketing. Upon completion of a successful remarketing,
after deducting as the remarketing fee an amount not exceeding 25 basis points
(0.25%) of the total proceeds of such remarketing of Pledged Notes, the
Remarketing Agent will Transfer the Agent-purchased Treasury Consideration
purchased from the proceeds of the remarketing to the Forward Purchase Contract
Agent, which shall thereupon Transfer such Agent-purchased Treasury
Consideration to the Collateral Agent. Upon receipt of the Agent-purchased
Treasury Consideration from the Forward Purchase Contract Agent following a
successful remarketing, (i) the Collateral Agent, for the benefit of the
Company, shall thereupon hold in the Collateral Account such Agent-purchased
Treasury Consideration to secure such Upper DECS Holders' obligations under the
Forward Purchase Contracts and to fund the quarterly interest payment or
payments due to Upper DECS Holders on or prior to the Stock Purchase Date, and
(ii) the remaining portion, if any, of the proceeds of such successful
remarketing shall be distributed by the Remarketing Agent to the Forward
Purchase Contract Agent for payment to such Upper DECS Holders participating in
such remarketing. On the Scheduled Stock Purchase Date, the Collateral Agent
shall, at the direction of the Company, (i) apply that portion of the payments
received in respect of the Pledged Treasury Consideration equal to the aggregate
Stated Amount of the related Upper DECS to satisfy in full the obligations of
such Upper DECS Holders to pay the Purchase Price under the related Forward
Purchase Contracts and (ii) apply the remaining portion to pay to Upper DECS
Holders on such Stock Purchase Date an amount equal to the amounts which would
have been due on the interest Payment Date falling on the Scheduled Stock
Purchase Date, which shall be paid on the Pledged Notes in an amount equal to
the
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Coupon Rate for such quarterly interest payment. On any Accelerated Stock
Purchase Date, the Collateral Agent shall, at the direction of the Company,
Transfer (i) to the Company that portion then held in the Collateral Account of
the Pledged Treasury Consideration, Pledged Applicable Ownership Interest in the
Treasury Portfolio and Pledged Securities which is described in clause (2) of
the definition of Remarketing Value (assuming, for this purpose, that the
Remarketing Date is the date of such Accelerated Stock Purchase Date), to
satisfy in full the obligations of Holders of the related DECS to pay the
Purchase Price under the related Forward Purchase Contracts, and (ii) to the
Forward Purchase Contract Agent, for distribution to the applicable Holders of
DECS, the remaining portion then held in the Collateral Account of the Pledged
Treasury Consideration, Pledged Applicable Ownership Interest in the Treasury
Portfolio and Pledged Securities.
(b) Within three Business Days following a Last Failed Remarketing or
Last Failed Accelerated Remarketing, the Notes delivered to the Remarketing
Agent pursuant to Section 4.5(a) hereof shall be returned to the Collateral
Agent, together with written notice from the Remarketing Agent of such Last
Failed Remarketing or Last Failed Accelerated Remarketing. The Collateral Agent,
for the benefit of the Company, shall thereupon hold such Notes to secure the
Upper DECS Holders' obligations under the Forward Purchase Contracts. The
Remarketing Agent shall make one or more attempts to remarket the Notes in
accordance with the procedures set forth in the Forward Purchase Contract
Agreement and the Remarketing Agreement. If by 4:00 p.m., New York City time, on
the Business Day immediately preceding the Stock Purchase Date or the
Accelerated Stock Purchase Date, as the case may be, the Remarketing Agent has
failed to remarket the Notes at 100.5% of the Remarketing Value or Accelerated
Remarketing Value, as applicable, the Last Failed Remarketing or the Last Failed
Accelerated Remarketing, as the case may be, shall be deemed to have occurred.
In this case, the Remarketing Agent shall advise the Collateral Agent in writing
that it cannot remarket the related Pledged Notes of such Holders of Upper DECS.
Upon the occurrence of a Last Failed Remarketing or Last Failed Accelerated
Remarketing, the Company will purchase the Notes of all holders, except Notes
for which an Opt-Out Notice has been delivered to the Forward Purchase Contract
Agent in compliance with Section 206 of the Supplemental Indenture, for an
amount equal to the Stated Amount of such Notes, plus an amount in cash equal to
the value of the Treasury securities described in subclause (ii) of the
definition of Accelerated Remarketing Value (assuming for this purpose that the
relevant Subsequent Remarketing Date is the Accelerated Stock Purchase Date).
The proceeds of the sale of the Notes purchased by the Company shall be paid (a)
to the Collateral Agent on behalf of such holders to satisfy such holders'
obligation under the related Forward Purchase Contract if such Notes are part of
an Upper DECS, with any excess to be paid to the forward purchase contract
agent for the benefit of the Holders of such Upper DECS, and (b) to the Holders
of such Notes if the Notes are Separate Notes. The Collateral Agent, for the
benefit of the Company will, at the written direction of the Company, retain or
dispose of the Pledged Notes in accordance with applicable law and satisfy in
full, from any such disposition or retention, such Holders' obligations to pay
the Purchase Price for the Common Stock; provided, that if upon a Failed
Remarketing, the Collateral Agent exercises such rights for the benefit of the
Company with respect to such Notes, any accrued and unpaid interest on
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such Notes will become payable by the Company to the Forward Purchase Contract
Agent for payment to the Holders of the Upper DECS to which such Notes relate in
accordance with the Forward Purchase Contract Agreement.
(c) In the event a Holder of Stripped DECS has not made a Cash
Settlement, Early Settlement or Merger Early Settlement of the Forward Purchase
Contracts underlying its Stripped DECS, such Holder shall be deemed to have
elected to pay for the shares of Common Stock to be issued under such Forward
Purchase Contracts from the payments received in respect of the related Pledged
Treasury Securities. Without receiving any instruction from any such Holder, the
Collateral Agent shall apply such payments to the settlement of such Forward
Purchase Contracts on the Stock Purchase Date. In the event the payments
received in respect of the related Pledged Treasury Securities are in excess of
the aggregate Purchase Price under the Forward Purchase Contracts being settled
thereby, the Collateral Agent shall distribute such excess, when received, to
the Forward Purchase Contract Agent for the benefit of such Holders of Stripped
DECS.
(d) On or prior to the fourth Business Day preceding the Remarketing
Date, any Accelerated Remarketing Date or the first day of any subsequent
Remarketing Period, but no earlier than the Payment Date immediately preceding
the last Payment Date before the relevant Stock Purchase Date, holders of
Separate Notes may elect to have their Separate Notes remarketed by Transferring
their Separate Notes and delivering a notice of such election, substantially in
the form of Exhibit C hereto, to the Custodial Agent. On the third Business Day
prior to the Remarketing Date, any Accelerated Remarketing Date or the first day
of any subsequent Remarketing Period, by 10:00 a.m., New York City time, the
Custodial Agent shall notify the Remarketing Agent of the number of such
Separate Notes to be remarketed. The Custodial Agent will hold such Separate
Notes in an account separate from the Collateral Account. A holder of Separate
Notes electing to have its Separate Notes remarketed will also have the right to
withdraw such election by written notice to the Custodial Agent, substantially
in the form of Exhibit D hereto, on or prior to the fourth Business Day
immediately preceding the applicable Remarketing Date, Accelerated Remarketing
Date or first day of a subsequent Remarketing Period, upon which notice the
Custodial Agent will return such Separate Notes to such holder. On the third
Business Day immediately preceding the Remarketing Date, any Accelerated
Remarketing Date or the first day of any subsequent Remarketing Period, the
Custodial Agent at the written direction of the Remarketing Agent will deliver
to the Remarketing Agent for remarketing all Separate Notes delivered to the
Custodial Agent pursuant to this Section 4.5(d) and not withdrawn pursuant to
the terms hereof prior to such date. After deducting as the remarketing fee an
amount not exceeding 25 basis points (0.25%) of the total proceeds of such
remarketing of such Separate Notes, the Remarketing Agent will remit to the
Custodial Agent the portion of the proceeds from such remarketing, if
successful, equal to the amount calculated in respect of such Separate Notes as
set forth in Section 5.2(d) of the Forward Purchase Contract Agreement. If,
despite using its commercially reasonable best efforts, the Remarketing Agent
advises the Custodial Agent in writing that there has been a Failed Remarketing
or Failed Accelerated
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Remarketing, the Remarketing Agent will promptly return such Separate Notes to
the Custodial Agent for redelivery to such holders of such Separate Notes.
ARTICLE V
VOTING RIGHTS -- NOTES
SECTION 5.1 Exercise by Forward Purchase Contract Agent.
The Forward Purchase Contract Agent may exercise, or refrain from
exercising, any and all voting and other consensual rights pertaining to the
Pledged Notes or any part thereof for any purpose not inconsistent with the
terms of this Agreement and in accordance with the terms of the Forward Purchase
Contract Agreement; provided, that the Forward Purchase Contract Agent shall not
exercise or, as the case may be, shall not refrain from exercising such right
if, in the judgment of the Company, such action would impair or otherwise have a
material adverse affect on the value of all or any of the Pledged Notes; and
provided, further, that the Forward Purchase Contract Agent shall give the
Company and the Collateral Agent at least five days' prior written notice of the
manner in which it intends to exercise, or its reasons for refraining from
exercising, any such right. Upon receipt of any notices and other communications
in respect of any Pledged Notes, including notice of any meeting at which
holders of Notes are entitled to vote or solicitation of consents, waivers or
proxies of holders of Notes, the Collateral Agent shall use reasonable efforts
to send promptly to the Forward Purchase Contract Agent such notice or
communication, and as soon as reasonably practicable after receipt of a written
request therefor from the Forward Purchase Contract Agent, execute and deliver
to the Forward Purchase Contract Agent such proxies and other instruments in
respect of such Pledged Notes (in form and substance satisfactory to the
Collateral Agent) as are prepared by the Forward Purchase Contract Agent with
respect to the Pledged Notes.
ARTICLE VI
RIGHTS AND REMEDIES; TAX EVENT REDEMPTION
SECTION 6.1 Rights and Remedies of the Collateral Agent.
(a) In addition to the rights and remedies available at law or in
equity, after an event of default under the Forward Purchase Contracts, the
Collateral Agent shall have all of the rights and remedies with respect to the
Collateral of a secured party under the Uniform Commercial Code (or any
successor thereto) as in effect in the State of New York from time to time (the
"Code") (whether or not the Code is in effect in the jurisdiction where the
rights and remedies are asserted) and the TRADES Regulations and such additional
rights and remedies to which a secured party is entitled under the laws in
effect in any jurisdiction where any rights and remedies hereunder may be
asserted. Wherever reference is made in this Agreement to any section of the
Code, such reference shall be deemed to include a reference to any provision of
the Code which is a
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successor to, or amendment of, such section. Without limiting the generality of
the foregoing, such remedies may include, to the extent permitted by applicable
law, (i) retention of the Pledged Notes or other Collateral in full satisfaction
of the Holders' obligations under the Forward Purchase Contracts or (ii) sale of
the Pledged Notes or other Collateral in one or more public or private sales, in
each case at the written direction of the Company.
(b) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, in the event the Collateral Agent is unable
to make payments to the Company on account of any Pledged Treasury
Consideration, Pledged Applicable Ownership Interest in the Treasury Portfolio
or Pledged Treasury Securities as provided in Article III hereof in satisfaction
of the obligations of the Holder of the DECS of which such Pledged Treasury
Consideration, Pledged Applicable Ownership Interest in the Treasury Portfolio
or Pledged Treasury Securities, as applicable, are a part under the related
Forward Purchase Contracts, the inability to make such payments shall constitute
an event of default under the Forward Purchase Contracts and the Collateral
Agent shall have and may exercise, with reference to such Pledged Treasury
Consideration, Pledged Applicable Ownership Interest in the Treasury Portfolio
or Pledged Treasury Securities, as applicable, and such obligations of such
Holder, any and all of the rights and remedies available to a secured party
under the Code and the TRADES Regulations after default by a debtor, and as
otherwise granted herein or under any other law.
(c) Without limiting any rights or powers otherwise granted by this
Agreement to the Collateral Agent, the Collateral Agent is hereby irrevocably
authorized to receive and collect all payments of (i) the principal amount of,
or interest on, the Pledged Notes, or (ii) the principal amount of, or interest
(if any) on, the Pledged Treasury Consideration, Pledged Applicable Ownership
Interest in the Treasury Portfolio or Pledged Treasury Securities, subject, in
each case, to the provisions of Article III, and as otherwise granted herein.
(d) The Forward Purchase Contract Agent, individually and as
attorney-in-fact for each Holder of DECS, agrees that, from time to time, upon
the written request of the Company or the Collateral Agent (acting upon the
written request of the Company), the Forward Purchase Contract Agent or such
Holder shall execute and deliver such further documents and do such other acts
and things as the Company or the Collateral Agent (acting upon the written
request of the Company) may reasonably request in order to maintain the Pledge,
and the perfection and priority thereof, and to confirm the rights of the
Collateral Agent hereunder. The Forward Purchase Contract Agent shall have no
liability to any Holder for executing any documents or taking any such acts
requested by the Company or the Collateral Agent (acting upon the written
request of the Company) hereunder, except for liability for its own negligent
act, its own negligent failure to act, its bad faith or its own willful
misconduct.
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SECTION 6.2 Substitutions.
Whenever a Holder has the right to substitute Treasury Securities,
Notes, Treasury Consideration or the appropriate Applicable Ownership Interest
in the Treasury Portfolio, as the case may be, for Collateral held by the
Collateral Agent, such substitution shall not constitute a novation of the
security interest created hereby.
SECTION 6.3 Tax Event Redemption.
Upon the occurrence of a Tax Event Redemption prior to a successful
remarketing of the Pledged Notes, the aggregate Redemption Price payable on the
Tax Event Redemption Date with respect to such Pledged Notes shall be delivered
to the Collateral Agent by the Trustee at or prior to 12:00 p.m., New York City
time, by wire transfer in immediately available funds at such place and at such
account as may be designated by the Collateral Agent in exchange for the Pledged
Notes. In the event the Collateral Agent receives such Redemption Price, the
Collateral Agent will, at the written direction of the Company, apply an amount,
out of such Redemption Price, equal to the aggregate Tax Event Redemption
Principal Amount with respect to the Pledged Notes to purchase from the
Quotation Agent the Treasury Portfolio and promptly remit the remaining portion
of such Redemption Price to the Forward Purchase Contract Agent for payment to
the Holders of Upper DECS. The Collateral Agent shall Transfer the Treasury
Portfolio to the Collateral Account to secure the obligation of all Holders of
Upper DECS to purchase Common Stock of the Company under the Forward Purchase
Contracts constituting a part of such Upper DECS, in substitution for the
Pledged Notes. Thereafter the Collateral Agent shall have such security
interests, rights and obligations with respect to the Treasury Portfolio as it
had in respect of the Pledged Notes as provided in Articles II, III, IV, V and
VI, and any reference herein to the Notes shall be deemed to be a reference to
such Treasury Portfolio, and any reference herein to interest on the Notes shall
be deemed to be a reference to distributions on such Treasury Portfolio.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES; COVENANTS
SECTION 7.1 Representations and Warranties.
The Holders from time to time, acting through the Forward Purchase
Contract Agent as their attorney-in-fact (it being understood that the Forward
Purchase Contract Agent shall not be liable for any representation or warranty
made by or on behalf of a Holder), hereby represent and warrant to the
Collateral Agent, which representations and warranties shall be deemed repeated
on each day a Holder Transfers Collateral that:
(a) such Holder has the power to grant a security interest in and lien
on the Collateral;
(b) such Holder is the sole beneficial owner of the Collateral and, in
the case of Collateral delivered in physical form, is the sole holder of such
Collateral and is the sole
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beneficial owner of, or has the right to Transfer, the Collateral it Transfers
to the Collateral Agent, free and clear of any security interest, lien,
encumbrance, call, liability to pay money or other restriction other than the
security interest and lien granted under Section 2.1 hereof;
(c) upon the Transfer of the Collateral to the Collateral Account, the
Collateral Agent, for the benefit of the Company, will have a valid and
perfected first priority security interest therein (assuming that any central
clearing operation or any Intermediary or other entity not within the control of
the Holder involved in the Transfer of the Collateral, including the Collateral
Agent, gives the notices and takes the action required of it hereunder and under
applicable law for perfection of that interest and assuming the establishment
and exercise of control pursuant to Section 2.2 hereof); and
(d) the execution and performance by the Holder of its obligations
under this Agreement will not result in the creation of any security interest,
lien or other encumbrance on the Collateral other than the security interest and
lien granted under Section 2.1 hereof or violate any provision of any existing
law or regulation applicable to it or of any mortgage, charge, pledge,
indenture, contract or undertaking to which it is a party or which is binding on
it or any of its assets.
SECTION 7.2 Covenants.
The Holders from time to time, acting through the Forward Purchase
Contract Agent as their attorney-in-fact (it being understood that the Forward
Purchase Contract Agent shall not be liable for any covenant made by or on
behalf of a Holder), hereby covenant to the Collateral Agent that for so long as
the Collateral remains subject to the Pledge:
(a) neither the Forward Purchase Contract Agent nor such Holders will
create or purport to create or allow to subsist any mortgage, charge, lien,
pledge or any other security interest whatsoever over the Collateral or any part
of it other than pursuant to this Agreement; and
(b) neither the Forward Purchase Contract Agent nor such Holders will
sell or otherwise dispose (or attempt to dispose) of the Collateral or any part
of it except for the beneficial interest therein, subject to the pledge
hereunder, transferred in connection with the sale or other disposition of the
DECS.
ARTICLE VIII
THE COLLATERAL AGENT
SECTION 8.1 Appointment, Powers and Immunities.
(a) The Collateral Agent shall act as agent for the Company hereunder
with such powers as are specifically vested in the Collateral Agent by the terms
of this Agreement,
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together with such other powers as are reasonably incidental thereto. Each of
the Collateral Agent, the Custodial Agent and the Securities Intermediary:
(i) shall have no duties or responsibilities except those
expressly set forth in this Agreement and no implied covenants or
obligations shall be inferred from this Agreement against any of them,
nor shall any of them be bound by the provisions of any agreement by
any party hereto beyond the specific terms hereof;
(ii) shall not be responsible for any recitals contained in
this Agreement, or in any certificate or other document referred to or
provided for in, or received by it under, this Agreement, the DECS or
the Forward Purchase Contract Agreement, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this
Agreement (other than as against the Collateral Agent, the Custodial
Agent or the Securities Intermediary, as the case may be), the DECS or
the Forward Purchase Contract Agreement or any other document referred
to or provided for herein or therein or for any failure by the Company
or any other Person (except the Collateral Agent, the Custodial Agent
or the Securities Intermediary, as the case may be) to perform any of
its obligations hereunder or thereunder or for the perfection, priority
or, except as expressly required hereby, existence, validity,
perfection or maintenance of any security interest created hereunder;
(iii) shall not be required to initiate or conduct any
litigation or collection proceedings hereunder (except in the case of
the Collateral Agent, pursuant to written directions furnished under
Section 8.2 hereof, subject to Section 8.6 hereof);
(iv) shall not be responsible for any action taken or omitted
to be taken by it hereunder or under any other document or instrument
referred to or provided for herein or in connection herewith or
therewith, except for its own gross negligence or willful misconduct;
and
(v) shall not be required to advise any party as to selling or
retaining, or taking or refraining from taking any action with respect
to, the DECS or other property deposited hereunder.
Subject to the foregoing, during the term of this Agreement, the
Collateral Agent shall take all reasonable action in connection with the
safekeeping and preservation of the Collateral hereunder.
(b) No provision of this Agreement shall require the Collateral Agent,
the Custodial Agent or the Securities Intermediary to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties hereunder. In no event shall the Collateral Agent, the Custodial
Agent or the Securities Intermediary be liable for any amount in excess of the
value of the Collateral or for any special, indirect, individual or
consequential damages or lost profits or loss of business, arising in connection
with this Agreement even if the Collateral Agent, the Custodial Agent or the
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Securities Intermediary has been advised of the likelihood of such loss or
damage being incurred and regardless of the form of action. Notwithstanding the
foregoing, the Collateral Agent, the Custodial Agent, the Forward Purchase
Contract Agent and the Securities Intermediary, each in its individual capacity,
hereby waive any right of setoff, banker's lien, liens or perfection rights as
securities intermediary or any counterclaim with respect to any of the
Collateral.
(c) The Collateral Agent, Custodial Agent and Securities Intermediary
shall have no liability whatsoever for the action or inaction of any Clearing
Agency or any book-entry system thereof. In no event shall any Clearing Agency
or any book-entry system thereof be deemed an agent or subcustodian of the
Collateral Agent, Custodial Agent and Securities Intermediary. The Collateral
Agent, Custodial Agent and Securities Intermediary shall not be responsible or
liable for any failure or delay in the performance of its obligations under this
Agreement arising out of or caused, directly or indirectly, by circumstances
beyond its reasonable control, including, without limitation, acts of God;
earthquakes; fires; floods; war (whether declared or undeclared); terrorism;
civil or military disturbances; sabotage; epidemics; riots; interruptions, loss
or malfunctions of utilities, computer (hardware or software) or communications
service; accidents; labor disputes; acts of civil or military authority;
governmental actions; or inability to obtain labor, material, equipment or
transportation.
SECTION 8.2 Instructions of the Company.
The Company shall have the right, by one or more instruments in writing
executed and delivered to the Collateral Agent, the Custodial Agent or the
Securities Intermediary, as the case may be, to direct the time, method and
place of conducting any proceeding for the realization of any right or remedy
available to the Collateral Agent, or of exercising any power conferred on the
Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be, or to direct the taking or refraining from taking of any action
authorized by this Agreement; provided, however, that (i) such direction shall
not conflict with the provisions of any law or of this Agreement and (ii) the
Collateral Agent, the Custodial Agent and the Securities Intermediary shall each
receive indemnity reasonably satisfactory to it as provided herein. Nothing in
this Section 8.2 shall impair the right of the Collateral Agent in its
discretion to take any action or omit to take any action which it deems proper
and which is not inconsistent with such direction.
SECTION 8.3 Reliance.
Each of the Collateral Agent, the Custodial Agent and the Securities
Intermediary shall be entitled conclusively to rely upon any certification,
order, judgment, opinion, notice or other communication (including, without
limitation, any thereof by telephone or facsimile) reasonably believed by it to
be genuine and correct and to have been signed or sent by or on behalf of the
proper Person or Persons (without being required to determine the correctness of
any fact stated therein), and upon advice and statements of legal counsel and
other experts selected by the Collateral Agent, the Custodial Agent or the
-21-
Securities Intermediary, as the case may be. As to any matters not expressly
provided for by this Agreement, the Collateral Agent, the Custodial Agent and
the Securities Intermediary shall in all cases be fully protected in acting, or
in refraining from acting, hereunder in accordance with instructions given by
the Company in accordance with this Agreement.
SECTION 8.4 Rights in Other Capacities.
The Collateral Agent, the Custodial Agent and the Securities
Intermediary and their affiliates may (without having to account therefor to the
Company) accept deposits from, lend money to, make investments in and generally
engage in any kind of banking, trust or other business with the Forward Purchase
Contract Agent, any Holder of DECS and any holder of Separate Notes (and any of
their respective subsidiaries or affiliates) as if it were not acting as the
Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be, and the Collateral Agent, the Custodial Agent and the Securities
Intermediary and their affiliates may accept fees and other consideration from
the Forward Purchase Contract Agent, any Holder of DECS or any holder of
Separate Notes without having to account for the same to the Company; provided
that each of the Collateral Agent, the Custodial Agent and the Securities
Intermediary covenants and agrees with the Company that, except as provided in
this Agreement, it shall not accept, receive or permit there to be created in
favor of itself (and waives any right of set-off or banker's lien with respect
to) and shall take no affirmative action to permit there to be created in favor
of any other Person, any security interest, lien or other encumbrance of any
kind in or upon the Collateral and the Collateral shall not be commingled with
any other assets of any such Person.
SECTION 8.5 Non-Reliance on Collateral Agent.
None of the Collateral Agent, the Custodial Agent and the Securities
Intermediary shall be required to keep itself informed as to the performance or
observance by the Forward Purchase Contract Agent or any Holder of DECS of this
Agreement, the Forward Purchase Contract Agreement, the DECS or any other
document referred to or provided for herein or therein or to inspect the
properties or books of the Forward Purchase Contract Agent or any Holder of
DECS. The Collateral Agent, the Custodial Agent and the Securities Intermediary
shall not have any duty or responsibility to provide the Company or the
Remarketing Agent with any credit or other information concerning the affairs,
financial condition or business of the Forward Purchase Contract Agent, any
Holder of DECS or any holder of Separate Notes (or any of their respective
subsidiaries or affiliates) that may come into the possession of the Collateral
Agent, the Custodial Agent or the Securities Intermediary or any of their
respective affiliates.
SECTION 8.6 Compensation and Indemnity.
The Company agrees:
(a) to pay each of the Collateral Agent, the Custodial Agent and the
Securities Intermediary from time to time such compensation as shall be agreed
in writing between
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the Company and the Collateral Agent, the Custodial Agent or the Securities
Intermediary, as the case may be, for all services rendered by each of them
hereunder, and
(b) to indemnify the Collateral Agent, the Custodial Agent, the
Securities Intermediary and their officers, directors and agents for, and to
hold each of them harmless from and against, any loss, liability or reasonable
out-of-pocket expense incurred without gross negligence or willful misconduct on
its part, arising out of or in connection with the acceptance or administration
of its powers and duties under this Agreement, including the reasonable
out-of-pocket costs and expenses (including reasonable fees and expenses of
counsel) of defending itself against any claim or liability in connection with
the exercise or performance of such powers and duties or collecting such
amounts. The Collateral Agent, the Custodial Agent and the Securities
Intermediary shall each promptly notify the Company of any third-party claim
which may give rise to the indemnity hereunder and give the Company the
opportunity to participate in the defense of such claim with counsel reasonably
satisfactory to the indemnified party, and no such claim shall be settled
without the written consent of the Company, which consent shall not be
unreasonably withheld. The provisions of this Section 8.6 shall survive the
resignation or removal of the Collateral Agent, the Custodial Agent and the
Securities Intermediary or the termination of this Agreement.
SECTION 8.7 Failure to Act.
In the event of any ambiguity in the provisions of this Agreement or
any dispute between or conflicting claims by or among the parties hereto or any
other Person with respect to any funds or property deposited hereunder, the
Collateral Agent, the Custodial Agent and the Securities Intermediary shall be
entitled, after prompt notice to the Company and the Forward Purchase Contract
Agent, at its sole option, to refuse to comply with any and all claims, demands
or instructions with respect to such property or funds so long as such dispute
or conflict shall continue, and none of the Collateral Agent, the Custodial
Agent or the Securities Intermediary shall be or become liable in any way to any
of the parties hereto for its failure or refusal to comply with such conflicting
claims, demands or instructions. The Collateral Agent, the Custodial Agent and
the Securities Intermediary shall be entitled to refuse to act until either (i)
such conflicting or adverse claims or demands shall have been finally determined
by a court of competent jurisdiction or settled by agreement between the
conflicting parties as evidenced in a writing, reasonably satisfactory to the
Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be, or (ii) the Collateral Agent, the Custodial Agent or the Securities
Intermediary, as the case may be, shall have received security or an indemnity
reasonably satisfactory to the Collateral Agent, the Custodial Agent or the
Securities Intermediary, as the case may be, sufficient to save the Collateral
Agent, the Custodial Agent or the Securities Intermediary, as the case may be,
harmless from and against any and all loss, liability or reasonable
out-of-pocket expense which the Collateral Agent, the Custodial Agent or the
Securities Intermediary, as the case may be, may incur by reason of its acting
without willful misconduct or gross negligence. The Collateral Agent, the
Custodial Agent or the Securities Intermediary may in addition elect
-23-
to commence an interpleader action or seek other judicial relief or orders as
the Collateral Agent, the Custodial Agent or the Securities Intermediary, as the
case may be, may deem necessary. Notwithstanding anything contained herein to
the contrary, none of the Collateral Agent, the Custodial Agent or the
Securities Intermediary shall be required to take any action that is in its
opinion contrary to law or to the terms of this Agreement, or which would in its
opinion subject it or any of its officers, employees or directors to liability.
SECTION 8.8 Resignation.
Subject to the appointment and acceptance of a successor Collateral
Agent, the Custodial Agent or Securities Intermediary, as provided below, (a)
the Collateral Agent, Custodial Agent and the Securities Intermediary may resign
at any time by giving notice thereof to the Company and the Forward Purchase
Contract Agent as attorney-in-fact for the Holders of DECS, (b) the Collateral
Agent, the Custodial Agent and the Securities Intermediary may be removed at any
time by the Company and (c) if the Collateral Agent, the Custodial Agent or the
Securities Intermediary fails to perform any of its material obligations
hereunder in any material respect for a period of not less than 20 days after
receiving written notice of such failure by the Forward Purchase Contract Agent
and such failure shall be continuing, the Collateral Agent, the Custodial Agent
or the Securities Intermediary may be removed by the Forward Purchase Contract
Agent. The Forward Purchase Contract Agent shall promptly notify the Company of
any removal of the Collateral Agent, the Custodial Agent or the Securities
Intermediary pursuant to clause (c) of the immediately preceding sentence. The
Company shall promptly notify the Forward Purchase Contract Agent of any removal
of the Collateral Agent, the Custodial Agent or the Securities Intermediary
pursuant to clause (b) of the second preceding sentence. Upon any such
resignation or removal, the Company shall have the right to appoint a successor
Collateral Agent, the Custodial Agent or Securities Intermediary, as the case
may be. If no successor Collateral Agent, Custodial Agent or Securities
Intermediary, as the case may be, shall have been so appointed and shall have
accepted such appointment within 30 days after the retiring Collateral Agent's,
the Custodial Agent's or Securities Intermediary's giving of notice of
resignation or such removal, then the retiring Collateral Agent, the Custodial
Agent or Securities Intermediary, as the case may be, may at the Company's
expense petition any court of competent jurisdiction for the appointment of a
successor Collateral Agent, the Custodial Agent or Securities Intermediary, as
the case may be. Each of the Collateral Agent, the Custodial Agent and the
Securities Intermediary shall be a bank which has an office in New York, New
York with a combined capital and surplus of at least $500,000,000 or any
affiliate of a bank holding company having such capital and surplus. Upon the
acceptance of any appointment as Collateral Agent, Custodial Agent or Securities
Intermediary, as the case may be, hereunder by a successor Collateral Agent,
Custodial Agent or Securities Intermediary, as the case may be, such successor
shall thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Collateral Agent, Custodial Agent or
Securities Intermediary, as the case may be, and the retiring Collateral Agent,
Custodial Agent or Securities Intermediary, as the case
-24-
may be, shall take all appropriate action to transfer any money and property
held by it hereunder (including the Collateral) to such successor after the
payment of any outstanding fees, expenses and indemnities due and owing to such
retiring party. The retiring Collateral Agent, Custodial Agent or Securities
Intermediary shall, upon such succession, be discharged from its duties and
obligations as Collateral Agent, Custodial Agent or Securities Intermediary
hereunder. After any retiring Collateral Agent's, Custodial Agent's or
Securities Intermediary's resignation hereunder as Collateral Agent, Custodial
Agent or Securities Intermediary, the provisions of this Section 8.8, and
Section 8.6 hereof, shall continue in effect for its benefit in respect of any
actions taken or omitted to be taken by it while it was acting as the Collateral
Agent, Custodial Agent or Securities Intermediary. Any resignation or removal of
the Collateral Agent hereunder shall be deemed for all purposes of this
Agreement as the simultaneous resignation or removal of the Custodial Agent and
the Securities Intermediary hereunder.
SECTION 8.9 Right to Appoint Agent or Advisor.
The Collateral Agent shall have the right to appoint or consult with
agents or advisors in connection with any of its duties hereunder, and the
Collateral Agent shall not be liable for any action taken or omitted by, or in
reliance upon the advice of, such agents or advisors selected in good faith. The
appointment of agents (other than legal counsel) pursuant to this Section 8.9
shall be subject to prior consent of the Company, which consent shall not be
unreasonably withheld.
SECTION 8.10 Survival.
The provisions of this Article VIII shall survive termination of this
Agreement and the resignation or removal of the Collateral Agent, the Custodial
Agent or the Securities Intermediary.
SECTION 8.11 Exculpation.
Anything in this Agreement to the contrary notwithstanding, in no event
shall any of the Collateral Agent, the Custodial Agent or the Securities
Intermediary or their officers, employees or agents be liable under this
Agreement to any third party for indirect, special, punitive or consequential
loss or damage of any kind whatsoever, including lost profits, whether or not
the likelihood of such loss or damage was known to the Collateral Agent, the
Custodial Agent or the Securities Intermediary, or any of them, and regardless
of the form of action.
ARTICLE IX
AMENDMENT
SECTION 9.1 Amendment Without Consent of Holders.
Without the consent of any Holders or the holders of any Separate
Notes, the Company, when authorized by a Board Resolution, the Collateral Agent,
the Custodial
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Agent, the Securities Intermediary and the Forward Purchase Contract Agent, at
any time and from time to time, may amend this Agreement, in form satisfactory
to the Company, the Collateral Agent, the Custodial Agent, the Securities
Intermediary and the Forward Purchase Contract Agent, for any of the following
purposes:
(i) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of
the Company; or
(ii) 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 so long as such covenants or such surrender does not
adversely affect the validity, perfection or priority of the security
interests granted or created hereunder; or
(iii) to evidence and provide for the acceptance of
appointment hereunder by a successor Collateral Agent, Custodial Agent,
Securities Intermediary or Forward Purchase Contract Agent; or
(iv) 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 or
(v) to permit the substitution by Holders of designated
Company debt instruments for the Pledged Notes as Collateral under this
Agreement.
SECTION 9.2 Amendment with Consent of Holders.
With the consent of the Holders of not less than a majority of the
Forward Purchase Contracts at the time outstanding, by Act of said Holders
delivered to the Company, the Forward Purchase Contract Agent or the Collateral
Agent, as the case may be, the Company, when duly authorized by a Board
Resolution, the Forward Purchase Contract Agent, the Collateral Agent, the
Custodial Agent and the Securities Intermediary may amend this Agreement for the
purpose of modifying in any manner the provisions of this Agreement or the
rights of the Holders in respect of the DECS; provided, however, that no
amendment agreement shall, without the consent of the Holder of each Outstanding
DECS adversely affected thereby,
(i) change the amount or type of Collateral underlying a DECS
(except as provided in Section 9.1(v)) for the rights of holders of
Upper DECS to substitute the Treasury Securities for the Pledged Notes,
Pledged Treasury Consideration or the appropriate Pledged Applicable
Ownership Interest in the Treasury Portfolio, as the case may be, or
the rights of Holders of Stripped DECS to substitute Notes or the
appropriate Treasury Consideration or the appropriate Applicable
Ownership Interest in the Treasury Portfolio, as applicable, for the
Pledged Treasury Securities), unless not adverse to the Holders, impair
the right
-26-
of the Holder of any DECS to receive distributions on the underlying
Collateral or otherwise adversely affect the Holder's rights in or to
such Collateral; or
(ii) otherwise effect any action that would require the
consent of the Holder of each Outstanding DECS affected thereby
pursuant to the Forward Purchase Contract Agreement if such action were
effected by an agreement supplemental thereto; or
(iii) reduce the percentage of Forward Purchase Contracts the
consent of whose Holders is required for any such amendment.
It shall not be necessary for any Act of Holders under this Section to approve
the particular form of any proposed amendment, but it shall be sufficient if
such Act shall approve the substance thereof.
SECTION 9.3 Execution of Amendments.
In executing any amendment permitted by this Section, the Collateral
Agent, the Custodial Agent, the Securities Intermediary and the Forward Purchase
Contract Agent shall receive and (subject to Section 8.1 hereof, with respect to
the Collateral Agent, and Section 7.1 of the Forward Purchase Contract
Agreement, with respect to the Forward Purchase Contract Agent) shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of
such amendment is authorized or permitted by this Agreement and that all
conditions precedent, if any, to the execution and delivery of such amendment
have been satisfied and, in the case of an amendment pursuant to Section 9.1,
that such amendment does not adversely affect the validity, perfection or
priority of the security interests granted or created hereunder.
SECTION 9.4 Effect of Amendments.
Upon the execution of any amendment under this Article IX, this
Agreement shall be modified in accordance therewith, and such amendment shall
form a part of this Agreement for all purposes; and every Holder of Certificates
theretofore or thereafter authenticated, executed on behalf of the Holders and
delivered under the Forward Purchase Contract Agreement shall be bound thereby.
SECTION 9.5 Reference to Amendments.
Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any amendment pursuant to this Section may, and
shall if required by the Collateral Agent or the Forward Purchase Contract
Agent, bear a notation in form approved by the Forward Purchase Contract Agent
and the Collateral Agent as to any matter provided for in such amendment. If the
Company shall so determine, new Certificates so modified as to conform, in the
opinion of the Collateral Agent, the Forward Purchase Contract Agent and the
Company, to any such amendment may be prepared and executed by the Company and
authenticated, executed on behalf of the
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Holders and delivered by the Forward Purchase Contract Agent in accordance with
the Forward Purchase Contract Agreement in exchange for outstanding
Certificates.
ARTICLE X
MISCELLANEOUS
SECTION 10.1 No Waiver.
No failure on the part of any party hereto or any of its agents to
exercise, and no course of dealing with respect to, and no delay in exercising,
any right, power or remedy hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise by any party hereto or any of its agents of
any right, power or remedy hereunder preclude any other or further exercise
thereof or the exercise of any other right, power or remedy. The remedies herein
are cumulative and are not exclusive of any remedies provided by law.
SECTION 10.2 GOVERNING LAW.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK. Without limiting the foregoing, the above
choice of law is expressly agreed to by the Securities Intermediary, the
Collateral Agent, the Custodial Agent and the Holders from time to time acting
through the Forward Purchase Contract Agent, as their attorney-in-fact, in
connection with the establishment and maintenance of the Collateral Account,
which law, for purposes of the Code, shall be deemed to be the law governing all
Security Entitlements related thereto. In addition, such parties agree that, for
purposes of the Code, New York shall be the Securities Intermediary's
jurisdiction. The Company, the Collateral Agent and the Holders from time to
time of the DECS, acting through the Forward Purchase Contract Agent as their
attorney-in-fact, hereby submit to the nonexclusive jurisdiction of the United
States District Court for the Southern District of New York and of any New York
state court sitting in New York City for the purposes of all legal proceedings
arising out of or relating to this Agreement or the transactions contemplated
hereby. The Company, the Collateral Agent and the Holders from time to time,
acting through the Forward Purchase Contract Agent as their attorney-in-fact,
irrevocably waive, to the fullest extent permitted by applicable law, any
objection which they may now or hereafter have to the laying of the venue of any
such proceeding brought in such a court and any claim that any such proceeding
brought in such a court has been brought in an inconvenient forum.
SECTION 10.3 Notices.
Unless otherwise stated herein, all notices, requests, consents and
other communications provided for herein (including, without limitation, any
modifications of, or waivers or consents under, this Agreement) shall be given
or made in writing (including, without limitation, by telecopy) delivered to the
intended recipient at the "Address for Notices" specified below its name on the
signature pages hereof or, as to any party, at such other address as shall be
designated by such party in a notice to the
-28-
other parties. Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given when personally delivered
or, in the case of a mailed notice or notice transmitted by telecopier, upon
receipt, in each case given or addressed as aforesaid.
SECTION 10.4 Successors and Assigns.
This Agreement shall be binding upon and inure to the benefit of the
respective successors and assigns of the Company, the Collateral Agent, the
Custodial Agent, the Securities Intermediary and the Forward Purchase Contract
Agent, and the Holders from time to time of the DECS, by their acceptance of the
same, shall be deemed to have agreed to be bound by the provisions hereof and to
have ratified the agreements of, and the grant of the Pledge hereunder by, the
Forward Purchase Contract Agent.
SECTION 10.5 Counterparts.
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one and the same instrument, and any of
the parties hereto may execute this Agreement by signing any such counterpart.
SECTION 10.6 Severability.
If any provision hereof is invalid and unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in order to carry out the intentions of the parties
hereto as nearly as may be possible and (ii) the invalidity or unenforceability
of any provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction.
SECTION 10.7 Expenses, Etc.
The Company agrees to reimburse the Collateral Agent, the Securities
Intermediary and the Custodial Agent for:
(a) all reasonable out-of-pocket costs and all reasonable expenses of
the Collateral Agent, the Custodial Agent and the Securities Intermediary
(including, without limitation, the reasonable fees and expenses of counsel to
the Collateral Agent, the Custodial Agent and the Securities Intermediary), in
connection with (i) the negotiation, preparation, execution and delivery or
performance of this Agreement and (ii) any modification, supplement or waiver of
any of the terms of this Agreement;
(b) all reasonable costs and expenses of the Collateral Agent
(including, without limitation, reasonable fees and expenses of counsel) in
connection with (i) any enforcement or proceedings resulting or incurred in
connection with causing any Holder of DECS to satisfy its obligations under the
Forward Purchase Contracts forming a part of the DECS and (ii) the enforcement
of this Section 10.7; and
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(c) all transfer, stamp, documentary or other similar taxes,
assessments or charges levied by any governmental or revenue authority in
respect of this Agreement or any other document referred to herein and all
costs, expenses, taxes, assessments and other charges incurred in connection
with any filing, registration, recording or perfection of any security interest
contemplated hereby.
SECTION 10.8 Security Interest Absolute.
All rights of the Collateral Agent and security interests hereunder,
and all obligations of the Holders from time to time hereunder, shall be
absolute and unconditional irrespective of:
(a) any lack of validity or enforceability of any provision of the
Forward Purchase Contracts or the DECS or any other agreement or instrument
relating thereto;
(b) any change in the time, manner or place of payment of, or any other
term of, or any increase in the amount of, all or any of the obligations of
Holders of DECS under the related Forward Purchase Contracts, or any other
amendment or waiver of any term of, or any consent to any departure from any
requirement of, the Forward Purchase Contract Agreement or any Forward Purchase
Contract or any other agreement or instrument relating thereto; or
(c) any other circumstance which might otherwise constitute a defense
available to, or discharge of, a borrower, a guarantor or a pledgor.
SECTION 10.9 Waiver of Jury Trial.
EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE
UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND
THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
CAPITAL ONE FINANCIAL CORPORATION
By:
-------------------------------------
Name:
Title:
Address for Notices:
Capital One Financial Corporation
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Director of Capital Markets
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to the General Counsel:
Capital One Financial Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: General Counsel
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-▇▇-
▇▇▇ ▇▇▇▇▇▇▇ TRUST COMPANY, as
Forward Purchase Contract Agent and as
attorney-in-fact of the Holders from
time to time of the DECS
By:
-------------------------------------
Name:
Title:
Address for Notices:
BNY Midwest Trust Company
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
BNY MIDWEST TRUST COMPANY, as
Collateral Agent, Custodial Agent and
Securities Intermediary
By:
-------------------------------------
Name:
Title:
Address for Notices:
BNY Midwest Trust Company
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
-32-
EXHIBIT A
INSTRUCTION FROM FORWARD PURCHASE CONTRACT
AGENT TO COLLATERAL AGENT
BNY Midwest Trust Company,
as Collateral Agent
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Re: DECS of
Capital One Financial Corporation (the "Company")
We hereby notify you in accordance with Section [4.1] [4.2] of the
Pledge Agreement, dated as of April 23, 2002 (the "
Pledge Agreement"), among the
Company, you, as Collateral Agent, Custodial Agent and Securities Intermediary
and us, as Forward Purchase Contract Agent and as attorney-in-fact for the
holders of [Upper DECS] [Stripped DECS] from time to time, that the holder of
DECS listed below (the "Holder") has elected to substitute [$_____ aggregate
principal amount of Treasury Securities (CUSIP No. 912083AD5)] [$_______
aggregate principal amount of Notes or $_____ aggregate principal amount of
Treasury Consideration (CUSIP No. __________) or the Applicable Ownership
Interest in the Treasury Portfolio, as the case may be,] in exchange for the
related [Pledged Notes, Pledged Treasury Consideration or the appropriate
Pledged Applicable Ownership Interest in 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, the Treasury Consideration or the
appropriate Applicable Ownership Interest in the Treasury Portfolio, as the case
may be,] to you, as Collateral Agent. We hereby instruct you, upon receipt of
such [Pledged Treasury Securities] [Pledged Notes, Pledged Treasury
Consideration or the appropriate Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be], and upon the payment by such Holder of
any applicable fees, to release the [Notes, the Treasury Consideration or the
appropriate Applicable Ownership Interest in the Treasury Portfolio, as the case
may be,] [Treasury Securities] related to such [Upper DECS] [Stripped DECS] 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:
-------------------------
A-1
BNY MIDWEST TRUST COMPANY,
as Forward Purchase Contract Agent
By:
-------------------------------
Name:
Title:
A-2
Please print name, Social Security or other Taxpayer Identification
Number, if any, and address of registered Holder electing to substitute
[Treasury Securities] [Notes, Treasury Consideration or the appropriate
Applicable Ownership Interest in the Treasury Portfolio] for the [Pledged Notes,
Pledged Treasury Consideration or the appropriate Pledged Applicable Ownership
Interest in the Treasury Portfolio] [Pledged Treasury Securities]:
Name:
Social Security or other Taxpayer
Identification Number, if any:
Address:
A-3
EXHIBIT B
INSTRUCTION TO FORWARD PURCHASE CONTRACT AGENT
BNY Midwest Trust Company,
As Forward Purchase Contract Agent
▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Department
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Re: DECS of
Capital One Financial Corporation (the "Company")
The undersigned Holder hereby notifies you that it has delivered to BNY
Midwest Trust Company, as Collateral Agent, Custodial Agent and Securities
Intermediary [$_______ aggregate principal amount of Treasury Securities (CUSIP
No. 912083AD5)] [$_______ aggregate principal amount of Notes or $_____
principal amount of Treasury Consideration (CUSIP No. ______________) or the
appropriate Applicable Ownership Interest in the Treasury Portfolio, as the case
may be,] in exchange for the related [Pledged Notes, Pledged Treasury
Consideration or the appropriate Pledged Applicable Ownership Interest in the
Treasury Portfolio, as the case may be,] [Pledged Treasury Securities] held by
the Collateral Agent, in accordance with Section [4.1] [4.2] of the
Pledge
Agreement, dated April 23, 2002 (the "
Pledge Agreement"), among you, the Company
and the Collateral Agent. The undersigned Holder has paid the Collateral Agent
all applicable fees relating to such exchange. The undersigned Holder hereby
instructs you to instruct the Collateral Agent to release to you on behalf of
the undersigned Holder the [Pledged Notes, Pledged Treasury Consideration or the
appropriate Pledged Applicable Ownership Interest in the Treasury Portfolio, as
the case may be,] [Pledged Treasury Securities] related to such [Upper DECS]
[Stripped DECS]. Capitalized terms used herein but not defined shall have the
meaning set forth in the
Pledge Agreement.
Date: Signature:
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Signature Guarantee:
-----------------
Name:
Social Security or other Taxpayer
Identification Number, if any:
Address:
B-1
EXHIBIT C
INSTRUCTION TO CUSTODIAL AGENT REGARDING REMARKETING
BNY Midwest Trust Company,
as Custodial Agent
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Attention: Corporate Trust Department
Re: Notes of
Capital One Financial Corporation (the "Company")
The undersigned hereby notifies you in accordance with Section 4.5(d)
of the Pledge Agreement, dated as of April 23, 2002 (the "Pledge Agreement"),
among the Company, yourselves, as Collateral Agent, Securities Intermediary and
Custodial Agent, and BNY Midwest Trust Company, as Forward Purchase Contract
Agent and as attorney-in-fact for the Holders of Upper DECS and Stripped DECS
from time to time, that the undersigned elects to deliver $________ aggregate
principal amount of Notes for delivery to the Remarketing Agent on the fourth
Business Day immediately preceding the [Remarketing Date], [Accelerated
Remarketing Date] [the next scheduled Remarketing Period] for remarketing
pursuant to Section 4.5(d) of the Pledge Agreement. The undersigned will, upon
request of the Remarketing Agent, execute and deliver any additional documents
deemed by the Remarketing Agent or by the Company to be necessary or desirable
to complete the sale, assignment and transfer of the Notes tendered hereby.
The undersigned hereby instructs you, upon receipt of the proceeds of
such remarketing from the Remarketing Agent, net of amounts payable to the
Remarketing Agent in accordance with the Pledge Agreement, to deliver such
proceeds to the undersigned in accordance with the instructions indicated herein
under "A. Payment Instructions." The undersigned hereby instructs you, in the
event of a Failed Remarketing, upon receipt of the Notes tendered herewith from
the Remarketing Agent, to deliver the Notes to the person(s) at the address
indicated herein under "B. Delivery Instructions." Notwithstanding the
foregoing, in the event that such Failed Remarketing constitutes a Last Failed
Remarketing or Last Failed Accelerated Remarketing, you shall retain all such
Notes except those as to which you shall have received, at least three Business
Days prior to the relevant Stock Purchase Date, an Opt-Out Notice.
With this notice, the undersigned hereby (i) represents and warrants
that the undersigned has full power and authority to tender, sell, assign and
transfer the Notes tendered hereby and that the undersigned is the record owner
of any Notes tendered herewith in physical form or a participant in The
Depository Trust Company ("DTC") and the beneficial owner of any Notes tendered
herewith by book-entry transfer to your account at DTC and (ii) agrees to be
bound by the terms and conditions of Section 4.5(d)
C-1
of the Pledge Agreement. Capitalized terms used herein but not defined shall
have the meaning set forth in the Pledge Agreement.
Date: Signature:
------------------------- --------------------------
Signature Guarantee:
-----------------
Name:
Social Security or other
Taxpayer Identification Number, if any:
Address:
C-2
A. PAYMENT INSTRUCTIONS
Proceeds of the remarketing should be paid by check in the name of the
person(s) set forth below and mailed to the address set forth below.
Name(s):
-------------------------------
(Please Print)
Address:
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(Zip Code) (Please Print)
(Taxpayer Identification or Social Security
Number):
B. DELIVERY INSTRUCTIONS
In the event of a Failed Remarketing, Notes which are in physical form
should be mailed to the person(s) set forth below at the address set forth
below.
Name(s):
-------------------------------
(Please Print)
Address:
-------------------------------
(Zip Code) (Please Print)
(Taxpayer Identification or Social Security
Number):
In the event of a Failed Remarketing, Notes which are in book-entry
form should be credited to the account at The Depository Trust Company set forth
below.
Name of Account Party: DTC Account Number:
C-3
EXHIBIT D
INSTRUCTION TO CUSTODIAL AGENT REGARDING
WITHDRAWAL FROM REMARKETING
BNY Midwest Trust Company,
as Collateral Agent
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Attention: Corporate Trust Department
Re: Notes of Capital One Financial Corporation (the "Company")
The undersigned hereby notifies you in accordance with Section 4.5(d)
of the Pledge Agreement, dated as of April 23, 2002 (the "Pledge Agreement"),
among the Company, yourselves, as Collateral Agent, Securities Intermediary and
Custodial Agent and BNY Midwest Trust Company, as Forward Purchase Contract
Agent and as attorney-in-fact for the Holders of Upper DECS and Stripped DECS
from time to time, that the undersigned elects to withdraw the $_____ aggregate
principal amount of Notes delivered to the Custodial Agent on ___________, ____
for remarketing pursuant to Section 4.5(d) of the Pledge Agreement. The
undersigned hereby instructs you to return such Notes to the undersigned in
accordance with the undersigned's instructions. With this notice, the
undersigned hereby agrees to be bound by the terms and conditions of Section
4.5(d) of the Pledge Agreement. Capitalized terms used herein but not defined
shall have the meaning set forth in the Pledge Agreement.
Name(s):
-------------------------------
(Please Print)
Address:
-------------------------------
(Zip Code) (Please Print)
(Taxpayer Identification or Social Security
Number):
A. DELIVERY INSTRUCTIONS
In the event of a Failed Remarketing, Notes which are in physical form
should be mailed to the person(s) set forth below at the address set forth
below.
Name(s):
-------------------------------
(Please Print)
D-1
Address:
-------------------------------
(Zip Code) (Please Print)
(Taxpayer Identification or Social Security
Number):
In the event of a Failed Remarketing, Notes which are in book-entry
form should be credited to the account at The Depository Trust Company set forth
below.
Name of Account Party: DTC Account Number:
D-2