EXHIBIT 4.4
PLEDGE AGREEMENT
BETWEEN
AFFILIATED MANAGERS GROUP, INC.,
AND
FIRST UNION NATIONAL BANK,
AS COLLATERAL AGENT, CUSTODIAL AGENT,
PURCHASE CONTRACT AGENT AND SECURITIES INTERMEDIARY
DATED AS OF DECEMBER 21, 2001
Table of Contents
PAGE
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ARTICLE I
Definitions
Section 1.1 Definitions............................................................................2
ARTICLE II
Pledge; Control and Perfection
Section 2.1 The Pledge.............................................................................5
Section 2.2 Control and Perfection.................................................................7
ARTICLE III
Distributions on Pledged Collateral
ARTICLE IV
Substitution, Release, Repledge and Settlement of Senior Notes
Section 4.1 Substitution for Senior Notes and the Creation of Growth Prides........................9
Section 4.2 Substitution of Treasury Securities and the Creation of Income Prides.................10
Section 4.3 Termination Event.....................................................................11
Section 4.4 Cash Settlement.......................................................................11
Section 4.5 Early Settlement......................................................................12
Section 4.6 Application of Proceeds Settlement....................................................13
ARTICLE V
Voting Rights -Senior Notes
ARTICLE VI
Rights and Remedies
Section 6.1 Rights and Remedies of the Collateral Agent...........................................15
Section 6.2 Tax Event Redemption..................................................................16
Section 6.3 Initial Remarketing...................................................................17
Section 6.4 Substitutions.........................................................................18
ARTICLE VII
Representations and Warranties; Covenants
Section 7.1 Representations and Warranties........................................................18
Section 7.2 Covenants.............................................................................18
ARTICLE VIII
The Collateral Agent
Section 8.1 Appointment, Powers and Immunities....................................................19
Section 8.2 Instructions of the Company...........................................................20
Section 8.3 Reliance by Collateral Agent..........................................................20
Section 8.4 Rights in Other Capacities............................................................20
Section 8.5 Non-Reliance on Collateral Agent......................................................21
Section 8.6 Compensation and Indemnity............................................................21
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Section 8.7 Failure to Act........................................................................21
Section 8.8 Resignation of Collateral Agent.......................................................22
Section 8.9 Right to Appoint Agent or Advisor.....................................................23
Section 8.10 Survival..............................................................................23
Section 8.11 Exculpation...........................................................................23
ARTICLE IX
Amendment
Section 9.1 Amendment Without Consent of Holders..................................................23
Section 9.2 Amendment with Consent of Holders.....................................................24
Section 9.3 Execution of Amendments...............................................................24
Section 9.4 Effect of Amendments..................................................................24
Section 9.5 Reference to Amendments...............................................................25
ARTICLE X
Miscellaneous
Section 10.1 No Waiver.............................................................................25
Section 10.2 GOVERNING LAW.........................................................................25
Section 10.3 Notices...............................................................................25
Section 10.4 Successors and Assigns................................................................25
Section 10.5 Counterparts..........................................................................26
Section 10.6 Severability..........................................................................26
Section 10.7 Expenses, Etc.........................................................................26
Section 10.8 Security Interest Absolute............................................................26
Section 10.9 Consent to Jurisdiction; Miscellaneous................................................26
Section 10.10 Waiver of Immunities..................................................................27
EXHIBIT A
Instruction to Collateral Agent.................................................................................A-1
EXHIBIT B
Instruction to Purchase Contract Agent..........................................................................B-1
EXHIBIT C
Instruction to Custodial Agent Regarding Remarketing............................................................C-1
EXHIBIT D
Instruction to Custodial Agent Regarding Withdrawal from
Remarketing.....................................................................................................D-1
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PLEDGE AGREEMENT
PLEDGE AGREEMENT, dated as of December 21, 2001 (this "Agreement"),
among Affiliated Managers Group, Inc., a corporation organized and existing
under the laws of the State of Delaware (the "Company"), First Union National
Bank, a national banking association, 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"), 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 as purchase contract agent and
as attorney-in-fact of the Holders (as defined in the Purchase Contract
Agreement) from time to time of the Securities (as hereinafter defined) (in
such capacity, together with its successors in such capacity, the "Purchase
Contract Agent") under the Purchase Contract Agreement (as herein after
defined).
RECITALS
The Company and the Purchase Contract Agent are parties to the Purchase
Contract Agreement, dated as of the date hereof (as modified and supplemented
and in effect from time to time, the "Purchase Contract Agreement"), pursuant
to which there may be issued up to 8,000,000 FELINE PRIDES of the Company
(9,200,000 if the Underwriters' over-allotment option pursuant to the
Underwriting Agreement, dated December 18, 2001, among the Company and the
Underwriters (as defined therein) is exercised in full), having a stated
amount of $25 (the "Stated Amount") per FELINE PRIDES.
The FELINE PRIDES will initially consist of 8,000,000 units (referred
to as "Income PRIDES") with a face amount, per Income PRIDES, equal to the
Stated Amount. Each Income PRIDES will be comprised of (a) a stock purchase
contract (the "Purchase Contract") under which the holder will purchase from
the Company on November 17, 2004 (the "Purchase Contract Settlement Date"), a
number of shares of common stock, $0.01 par value per share (the "Common
Stock"), of the Company equal to the Settlement Rate (as defined below), and
(b) either beneficial ownership of $25 principal amount of the Company's 6%
Senior Notes due November 17, 2006 (each a "Senior Note") issued pursuant to
an indenture dated as of December 21, 2001, as amended by the First
Supplemental Indenture, dated as of December 21, 2001 (the "First
Supplemental Indenture", and, collectively, the "Indenture") between the
Company and First Union National Bank, as trustee (the "Trustee") or,
following the Successful Initial Remarketing or a Tax Event Redemption, the
Portfolio Interests (as hereinafter defined).
As provided herein, holders of Income PRIDES may substitute collateral
in order to create units of Growth PRIDES ("Growth PRIDES" and together, with
the Income PRIDES, the "Securities"). Each Growth PRIDES so created will be
comprised of (a) a Purchase Contract under which the holder will purchase
from the Company not later than the Purchase Contract Settlement Date, for an
amount in cash equal to the Stated Amount, a number of shares of Common Stock
equal to the Settlement Rate, and (b) a 1/40th undivided beneficial interest
in a zero-coupon U.S. Treasury Security (CUSIP No. 912803 AB9) having a
principal amount at
maturity equal to the aggregate principal amount of Senior Notes for which
substitution is being made and maturing on November 15, 2004 (the "Treasury
Securities").
Pursuant to the terms of the Purchase Contract Agreement and the
Purchase Contracts, the Holders, from time to time, of the Securities have
irrevocably authorized the 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 Senior
Notes, any Applicable Ownership Interest in the Treasury Portfolio (such
securities (as defined in Section 8-102(a)(15) of the Code) and Securities
Entitlements, collectively, the "Portfolio Interests") and any Treasury
Securities delivered in exchange or substitution therefor and all cash and
other proceeds thereof to secure each Holder's obligations under the related
Purchase Contract, as provided herein and subject to the terms hereof. Upon
such pledge, the Senior Notes, the Portfolio Interests and the Treasury
Securities will be beneficially owned by the Holders but will be owned of
record by the Purchase Contract Agent subject to the Pledge hereunder.
Accordingly, the Company, the Collateral Agent, the Securities
Intermediary, the Custodial Agent and the Purchase Contract Agent, on its own
behalf and as attorney-in-fact of the Holders from time to time of the
Securities, agree as follows:
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) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(b) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any
particular Article, Section or other subdivision;
(c) capitalized terms used but not otherwise defined herein have the
meanings assigned to such terms in the Purchase Contract Agreement; and
(d) terms used herein and defined in Article 8 or 9 of the Code and
not otherwise defined herein are used herein as defined in Article 8 or 9
of the Code.
"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.
"Cash" means any coin or currency of the United States as at the time
shall be legal tender for payment of public and private debts.
"Code" has the meaning specified in Section 6.1 hereof.
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"Collateral" has the meaning specified in Section 2.1 hereof.
"Collateral Account" means the securities account (number ___________)
maintained at First Union National Bank in the name First Union National
Bank, as Purchase Contract Agent on behalf of the holders of certain
securities of Affiliated Managers Group, Inc., Collateral Account subject to
the security interest of First Union National Bank, as Collateral Agent, for
the benefit of Affiliated Managers Group, Inc., as pledgee" and any successor
account.
"Collateral Agent" has the meaning specified in the first paragraph of
this Agreement.
"Common Stock" has the meaning specified in the Recitals.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such, and
thereafter "Company" shall mean such successor.
"Custodial Agent" 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.
"Permitted Investments" means any one of the following which shall
mature not later than the next succeeding Business Day: (i) any evidence of
indebtedness with an original maturity of 365 days or less issued, or
directly and fully guaranteed or insured, by the United States of America or
any agency or instrumentality thereof (provided that the full faith and
credit of the United States of America is pledged in support thereof or such
indebtedness constitutes a general obligation of it); (ii) deposits,
certificates of deposit or acceptances with an original maturity of 365 days
or less of any institution which is a member of the Federal Reserve System
having combined capital and surplus and undivided profits of not less than
US$200,000,000 at the time of deposit; (iii) investments with an original
maturity of 365 days or less of any Person that are fully and unconditionally
guaranteed by a bank of the type referred to in clause (ii); (iv) investments
in commercial paper, other than commercial paper issued by the Company or its
affiliates, of any corporation incorporated under the laws of the United
States or any State thereof, which commercial paper has a rating at the time
of purchase at least equal to "A-1" by Standard & Poor's Ratings Services
("S&P") or at least equal to "P-1" by ▇▇▇▇▇'▇ Investors Service, Inc.
("Moody's"); and (v) investments in money market funds registered under the
Investment Company Act of 1940, as amended, and rated in the highest
applicable rating category by S&P or Moody's.
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
"Pledge" has the meaning specified in Section 2.1 hereof.
"Pledged Senior Notes" has the meaning specified in Section 2.1 hereof.
"Pledged Treasury Securities" has the meaning specified in Section 2.1
hereof.
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"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.
"Purchase Contract" has the meaning specified in the Recitals.
"Purchase Contract Agent" has the meaning specified in the first
paragraph of this Agreement.
"Purchase Contract Agreement" has the meaning specified in the Recitals.
"Purchase Contract Settlement Date" has the meaning specified in the
Recitals.
"Remarketing Underwriting Agreement" means the Remarketing Underwriting
Agreement attached as Exhibit A to the Remarketing Agreement.
"Securities" has the meaning specified in the Recitals.
"Securities Intermediary" has the meaning specified in the first
paragraph of this Agreement.
"Security Entitlement" has the meaning set forth in Section
8-102(a)(17) of the Code.
"Senior Notes" has the meaning specified in the Recitals.
"Separate Senior Notes" means any Senior Notes that are not Pledged
Senior Notes.
"Stated Amount" has the meaning specified in the Recitals.
"Tax Event Redemption Date" means the date upon which a Tax Event
Redemption is to occur.
"TRADES" means the Treasury/Reserve Automated Debt Entry System
maintained by the Federal Reserve Bank of
New York pursuant to the TRADES
Regulations.
"TRADES Regulations" means the regulations of the United States
Department of the Treasury, published at 31 C.F.R. Part 357, as amended from
time to time. Unless otherwise defined herein, all terms defined in the
TRADES Regulations are used herein as therein defined.
"Transfer" means, with respect to the Collateral and in accordance with
the instructions of the Collateral Agent, the 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; and
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(ii) in the case of Collateral consisting of securities maintained
in book-entry form, by causing a "securities intermediary" (as defined in
Section 8-102(a)(14) of the Code) to (i) 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 (ii) 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.
"Treasury Security" has the meaning specified in the Recitals.
"Trust" has the meaning specified in the Recitals.
"Value" with respect to any item of Collateral on any date means, as to
(i) a Senior Note, the Stated Amount, (ii) Cash, the face amount thereof and
(iii) Treasury Securities and Portfolio Interests, the aggregate principal
amount thereof at maturity.
ARTICLE II
Pledge; Control and Perfection
Section 2.1 THE PLEDGE. The Holders from time to time acting through
the Purchase Contract Agent, as their attorney-in-fact, and the 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 Purchase Contracts, a security interest in all of the
right, title and interest of the Purchase Contract Agent and such Holders (a)
in the Senior Notes constituting a part of the Securities and any Treasury
Securities delivered in exchange for any Senior Notes (or, if applicable, the
Portfolio Interests) in accordance with Section 4.1 hereof, and any Senior
Notes (or, if applicable any Portfolio Interests) delivered in exchange for
any Treasury Securities, in accordance with Section 4.2 hereof, in each case
that have been Transferred to or received by the Collateral Agent and not
released by the Collateral Agent to such Holders under the provisions of this
Agreement; (b) in payments made by Holders pursuant to Section 4.4; (c) in
the Collateral Account and all securities, financial assets, Cash and other
property credited thereto and all Security Entitlements related thereto; (d)
in the Portfolio Interests and the Treasury Portfolio purchased on behalf of
the Holders of Income PRIDES by the Collateral Agent upon the occurrence of a
Successful Initial Remarketing or a Tax Event Redemption as provided in
Article VI, or otherwise; and (e) all Proceeds of the foregoing (all of the
foregoing, collectively, the "Collateral"). Prior to or concurrently with the
execution and delivery of this Agreement, the Purchase Contract Agent, on
behalf of the initial Holders of the Securities, shall cause the Senior Notes
comprising a part of the Income PRIDES to be Transferred to the Collateral
Agent for the benefit of the Company. Without limiting and in furtherance of
the foregoing, on such date, the Purchase Contract Agent on behalf of the
Holders, and as their attorney-in-fact, shall Transfer the Senior Global Note
(as defined in the Indenture) indorsed in blank or together with such powers
indorsed in blank as the Collateral Agent or the Company may request to the
Collateral Agent, which Transfer shall constitute delivery (as defined in
Section 8-301 of the Code) of the Senior Notes. On any date on which the
Senior Global Note (or any other security certificate (as defined in Section
8-102(a)(16) of the Code) evidencing all or a portion or the Pledged Senior
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Notes) shall be Transferred to a clearing corporation (as defined in Section
8-102(a)(5) of the Code) (as contemplated in Section 2.3 of the First
Supplemental Indenture) the Purchase Contract Agent on behalf of the Holders,
and as their attorney-in-fact, shall Transfer the Senior Notes, or cause the
Senior Notes to be Transferred, to the Collateral Account maintained by the
Collateral Agent at the Securities Intermediary by book-entry transfer to the
Collateral Account in accordance with applicable law including, without
limitation, the TRADES Regulations. If, at any time, the Global Senior Note
(as defined in the Indenture) shall be exchanged for Senior Notes in
definitive registered form pursuant to Section 2.3 of the First Supplemental
Indenture (or otherwise pursuant to the Indenture) evidenced by one or more
securities certificates (as defined in Section 8-102(a)(16) of the Code), the
Purchase Contract Agent, on behalf of the Holders, and as their
attorney-in-fact, shall forthwith Transfer to the Collateral Agent such
security certificates evidencing the Senior Notes, indorsed in blank or
together with such powers indorsed in blank as the Collateral Agent or the
Company may request. In the event a Holder of Income PRIDES so elects, such
Holder may Transfer Treasury Securities to the Collateral Agent for the
benefit of the Company in exchange for the release by the Collateral Agent on
behalf of the Company to the Purchase Contract Agent of Senior Notes or
Portfolio Interests, as the case may be, with a Stated Amount equal to the
aggregate principal amount of the Treasury Securities so Transferred, in the
case of the Senior Notes, or in the case of Portfolio Interests, equal to the
aggregate principal amount of the Treasury Securities so transferred. In the
event a Holder of Growth PRIDES so elects, such Holder may Transfer Senior
Notes or Portfolio Interests to the Collateral Agent for the benefit of the
Company in exchange for the release by the Collateral Agent on behalf of the
Company to the Purchase Contract Agent of Treasury Securities with an
aggregate principal amount at maturity equal to the aggregate principal
amount of the Senior Notes or such Portfolio Interests, so transferred to the
Purchase Contract Agent on behalf of such Holder. Such Treasury Securities
and Portfolio Interests, as applicable, shall be Transferred to the
Collateral Account maintained by the Collateral Agent at the Securities
Intermediary by book-entry transfer to the Collateral Account in accordance
with the TRADES Regulations and other applicable law and by the notation by
the Securities Intermediary on its books that a Security Entitlement with
respect to such Treasury Securities or such Portfolio Interests has been
credited to the Collateral Account. 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. The pledge provided in this Section 2.1 is herein
referred to as the "Pledge" and the Senior Notes, the Treasury Securities and
the Portfolio Interests subject to the Pledge, excluding any Senior Notes
that are delivered pursuant to Section 6.4 hereof, Treasury Securities or
Portfolio Interests released from the Pledge as provided in Sections 4.1 and
4.2 hereof, respectively, are hereinafter referred to as the "Pledged Senior
Notes," "Pledged Treasury Securities" and the "Pledged Portfolio Interests,"
respectively. Subject to the Pledge and the provisions of Section 2.2 hereof,
the Holders from time to time shall have full beneficial ownership of the
Collateral. Whenever directed by the Collateral Agent acting on behalf of the
Company, the Securities Intermediary shall have the right to reregister the
Senior Notes or any other Securities held in physical form in its name.
Except as may be required in order to release Senior Notes in
connection with a Holder's election to convert its investment from an Income
PRIDES to a Growth PRIDES, or except as otherwise required to release
Securities as specified herein, neither the Collateral Agent nor the
Securities Intermediary shall relinquish physical possession of any security
certificate evidencing
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a Senior Note prior to the termination of this Agreement except Senior Notes
may be held in any clearing corporation in an account including only assets
of customers of the Collateral Agent or Securities Intermediary. If it
becomes necessary for the Securities Intermediary to relinquish physical
possession of a security certificate in order to release a portion of the
Pledged Senior Notes evidenced thereby from the Pledge, the Securities
Intermediary shall use its best efforts to obtain physical possession of a
replacement security certificate evidencing any Senior Notes remaining
subject to the Pledge hereunder registered to it or indorsed in blank within
fifteen days of the date it 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 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
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 on behalf of the Company may give in writing with respect to
the Collateral Account, the Collateral credited thereto and any Security
Entitlements with respect to any thereof. Such instructions and entitlement
orders may, without limitation, direct the Securities Intermediary to
transfer, redeem, sell, liquidate, assign, deliver or otherwise dispose of
the Senior Notes, the Treasury Securities, the Portfolio Interests and any
Security Entitlements with respect thereto 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 Purchase Contract Agent hereby further
authorize and direct the Collateral Agent, as Agent of the Company, to itself
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 Purchase Contract Agent or any of the Holders. The Collateral Agent
shall be the agent of the Company and shall act as directed in writing by the
Company. Without limiting the generality of the foregoing, the Collateral
Agent shall issue entitlement orders to the Securities Intermediary when and
as directed by the Company.
(b) The Securities Intermediary hereby confirms and agrees that:
(i) it is a Person that in the ordinary course of business maintains
securities accounts for others and is acting in that capacity, (ii) all
securities or other property underlying any financial assets credited to the
Collateral Account shall be registered in the name of the Securities
Intermediary, indorsed to the Securities Intermediary or in blank or credited
to another Collateral Account maintained in the name of the Securities
Intermediary and in no case will any financial asset credited to the
Collateral Account be registered in the name of the Purchase Contract Agent,
the Collateral Agent, the Company or any Holder, payable to the order of, or
specially indorsed to, the Purchase Contract Agent, the Collateral Agent, the
Company or any Holder except to the extent the foregoing have been specially
indorsed to the Securities Intermediary or in blank; (iii) all property
delivered to the Securities Intermediary pursuant to this
Pledge Agreement
(including, without limitation, any Senior Notes, the Portfolio Interests or
Treasury Securities) will be promptly credited to the Collateral Account;
(iv) the Collateral Account is an account to which financial assets are or
may be credited, and the Securities Intermediary shall, subject to the terms
7
of this Agreement, treat the Purchase Contract Agent as entitled to
exercise the rights of any financial asset credited to the Collateral Account;
(v) 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; and (vi) 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
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 hereof.
(c) The Securities Intermediary hereby agrees that 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.
(d) 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.
(e) The Purchase Contract Agent hereby irrevocably constitutes and
appoints the Collateral Agent and the Company, with full power of substitution,
as the Purchase Contract Agent's attorney-in-fact to take on behalf of, and in
the name, place and stead of the 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 deemed to require of the Collateral Agent any
specific duties or obligations not otherwise assumed by the Collateral Agent
hereunder.
ARTICLE III
Distributions on Pledged Collateral
So long as the Purchase Contract Agent is the owner of the Pledged Senior
Notes and is acting in such capacity, it shall receive all payments thereon. If
the Pledged Senior Notes are issued in registered form (as defined in
8-102(a)(13)) or thereafter reregistered, such that the Collateral Agent becomes
the registered holder, all payments of the Stated Amount, or interest payments
on, the Pledged Senior Notes or, if applicable, the Pledged Portfolio Interests,
as the case may be, and all payments of the principal of, or cash distributions
on, any Pledged Treasury Securities or Pledged Portfolio Interests received by
the Collateral Agent 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) interest payments with respect to the
Pledged Senior Notes or Pledged Portfolio Interests, as the case may
be, and (B) any payments of the Stated Amount or, if applicable, the
principal amount, with respect to any Senior Notes or Portfolio
Interests, as the case may be, that have been released from the
Pledge pursuant to Section 4.1 or Section 4.3 hereof, to the
Purchase Contract Agent, for the benefit of the relevant Holders of
Securities, to the account designated by the Purchase Contract Agent
for such purpose, no later
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than 2:00 p.m.,
New York City time, on the Business Day such
payment is received by the Collateral Agent (provided that in the
event such payment is received by the Collateral Agent on a day
that is not a Business Day or after 12:30 p.m.,
New York City
time, on a Business Day, then such payment shall be made no later
than 10:30 a.m.,
New York City time, on the next succeeding
Business Day);
(ii) In the case of any principal payments with respect to any
Treasury Securities that have been released from the Pledge pursuant
to Section 4.2 or Section 4.3 hereof, to the Purchase Contract Agent
for the benefit of the Holders of the Growth PRIDES, to the accounts
designated by them in writing for such purpose no later than 2:00
p.m.,
New York City time, on the Business Day such payment is
received by the Collateral Agent (provided that in the event such
payment is received by the Collateral Agent on a day that is not a
Business Day or after 12:30 p.m.,
New York City time, on a Business
Day, then such payment shall be made no later than 10:30 a.m.,
New
York City time, on the next succeeding Business Day); and
(iii) In the case of payments of the Stated Amount of any
Pledged Senior Notes or any Pledged Portfolio Interests, as the case
may be, or the principal of any Pledged Treasury Securities, to the
Company on the Purchase Contract Settlement Date in accordance with
the procedure set forth in Section 4.6(a) or 4.6(b) hereof, in full
satisfaction of the respective obligations of the Holders under the
related Purchase Contracts and, to the extent such Proceeds exceed
the Purchase Price, to the Purchase Contract Agent for the benefit
of the Holders.
All payments received by the Purchase Contract Agent as provided herein
shall be applied by the Purchase Contract Agent pursuant to the provisions of
the Purchase Contract Agreement. If, notwithstanding the foregoing, the Purchase
Contract Agent shall receive any payments of the Stated Amount on account of any
Senior Note or, if applicable, any Portfolio Interest, that, at the time of such
payment, is a Pledged Senior Note or a Holder of a Growth PRIDES shall receive
any payments of principal on account of any Treasury Securities that, at the
time of such payment, are Pledged Treasury Securities, the 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 Company) for
application to the obligations of the Holders under the related Purchase
Contracts, and the Holders shall acquire no right, title or interest in any such
payments of Stated Amount or principal so received.
ARTICLE IV
Substitution, Release, Repledge and Settlement of Senior Notes
Section 4.1 SUBSTITUTION FOR SENIOR NOTES AND THE CREATION OF GROWTH
PRIDES. At any time on or prior to the fifth Business Day immediately preceding
the Purchase Contract Settlement Date (or on or prior to the second Business Day
immediately preceding the Purchase Contract Settlement Date, if a Tax Event
Redemption or a Successful Initial Remarketing has occurred), a Holder of Income
PRIDES shall have the right to substitute Treasury Securities for
9
the Pledged Senior Notes (or, if a Tax Event Redemption or a Successful
Initial Remarketing has occurred, the appropriate Portfolio Interests)
securing such Holder's obligations under the Purchase Contract(s) comprising
a part of its Income PRIDES in integral multiples of 40 Income PRIDES by (a)
Transferring to the Collateral Agent Treasury Securities having a Value equal
to the aggregate Stated Amount of the Pledged Senior Notes (or appropriate
Portfolio Interests, as the case may be), to be released and (b) delivering
the related Income PRIDES to the Purchase Contract Agent, accompanied by a
notice, substantially in the form of Exhibit B hereto, to the Purchase
Contract Agent stating that such Holder has Transferred Treasury Securities
to the Collateral Agent pursuant to clause (a) above (stating the Value of
the Treasury Securities Transferred by such Holder) and requesting that the
Purchase Contract Agent instruct the Collateral Agent to release from the
Pledge the Pledged Senior Notes or the appropriate Portfolio Interests, as
the case may be, related to such Income PRIDES. The Purchase Contract Agent
shall instruct the Collateral Agent in the form provided in Exhibit A;
provided, however, that if a Tax Event Redemption or a Successful Initial
Remarketing has occurred and the Portfolio Interests have become a component
of the Income PRIDES, Holders of Income PRIDES may make such substitution
only in integral multiples of 8,000 Income PRIDES at any time on or prior to
the second Business Day immediately preceding the Purchase Contract
Settlement Date. Upon receipt of Treasury Securities from a Holder of Income
PRIDES and the related instruction from the Purchase Contract Agent, the
Collateral Agent shall release the Pledged Senior Notes or the Pledged
Portfolio Interests, as the case may be, and shall promptly Transfer such
Pledged Senior Notes or the appropriate Portfolio Interests, as the case may
be, free and clear of any lien, pledge or security interest created hereby,
to the 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.
Section 4.2 SUBSTITUTION OF TREASURY SECURITIES AND THE CREATION OF INCOME
PRIDES. At any time on or prior to the fifth Business Day immediately preceding
the Purchase Contract Settlement Date (or on or prior to the second Business Day
immediately preceding the Purchase Contract Settlement Date, if a Tax Event
Redemption or a Successful Initial Remarketing has occurred), a Holder of Growth
PRIDES shall have the right to reestablish Income PRIDES consisting of the
Purchase Contracts and Senior Notes in integral multiples of 40 Income PRIDES by
(a) Transferring to the Collateral Agent Senior Notes having a Value equal to
the Value of the Pledged Treasury Securities to be released (or the appropriate
Portfolio Interests having a Value equal to the Value of the Pledged Treasury
Securities to be released) and (b) delivering the related Growth PRIDES to the
Purchase Contract Agent, accompanied by a notice, substantially in the form of
Exhibit B hereto, to the Purchase Contract Agent stating that such Holder has
transferred the relevant amount of Senior Notes (or the appropriate Portfolio
Interests, as the case may be) to the Collateral Agent pursuant to clause (a)
above and requesting that the Purchase Contract Agent instruct the Collateral
Agent to release from the Pledge the Pledged Treasury Securities related to such
Growth PRIDES. The Purchase Contract Agent shall instruct the Collateral Agent
in the form provided in Exhibit A; provided, however, that if a Tax Event
Redemption or a Successful Initial Remarketing has occurred and the Treasury
Portfolio has become a component of the Income PRIDES, Holders of Growth PRIDES
may make such substitution only in integral multiples of 8,000 Growth PRIDES at
any time on or prior to the second Business Day immediately preceding the
Purchase Contract Settlement Date. Upon receipt of the Senior Notes or the
Portfolio Interests as the case may be, from such Holder and
10
the instruction from the Purchase Contract Agent, the Collateral Agent shall
release the Treasury Securities having a corresponding aggregate principal
amount from the Pledge and shall promptly Transfer such Treasury Securities,
free and clear of any lien, pledge or security interest created hereby, to
the Purchase Contract Agent.
Section 4.3 TERMINATION EVENT. Upon receipt by the Collateral Agent of
written notice from the Company or the 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 Senior Notes (or
Portfolio Interests if a Tax Event Redemption or a Successful Initial
Remarketing has occurred) and Pledged Treasury Securities to the Purchase
Contract Agent for the benefit of the Holders of the Income PRIDES and the
Growth PRIDES, respectively, free and clear of any lien, pledge or security
interest or other interest created hereby.
If such Termination Event shall result from the Company's becoming a
debtor under any applicable uniform bankruptcy laws, and if the Collateral Agent
shall for any reason fail promptly to effectuate the release and Transfer of all
Pledged Senior Notes, the Pledged Portfolio Interests or of the Pledged Treasury
Securities, as the case may be, as provided by this Section 4.3, the Purchase
Contract Agent shall (i) use its best efforts to obtain an opinion of a
recognized law firm practicing law in the applicable jurisdiction 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 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 Senior Notes, the Pledged
Portfolio Interests or the Pledged Treasury Securities, as the case may be, as
provided in this Section 4.3, then the 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 any
such applicable bankruptcy laws seeking an order requiring the Collateral Agent
to effectuate the release and transfer of all Pledged Senior Notes, the Pledged
Portfolio Interests or of the 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 CASH SETTLEMENT. (a) Upon receipt by the Collateral Agent of
(i) a notice from the Purchase Contract Agent promptly after the receipt by the
Purchase Contract Agent of such notice that a Holder of an Income PRIDES or
Growth PRIDES has elected, in accordance with the procedures specified in
Section 5.3(a)(i) or (d)(i) of the Purchase Contract Agreement, respectively, to
settle its Purchase Contract with Cash and (ii) payment of the amount required
to settle such contract by such Holder on or prior to 11:00 a.m.,
New York City
time, on the Business Day immediately preceding the Purchase Contract Settlement
Date in lawful money of the United States by certified or cashiers' check or
wire transfer in immediately available funds payable to or upon the order of the
Company, then the Collateral Agent shall promptly invest any Cash received from
a Holder in connection with a Cash Settlement in Permitted Investments. Upon
receipt of the proceeds upon the maturity of the Permitted Investments on the
Purchase Contract Settlement Date, the Collateral Agent shall pay the portion of
such proceeds and deliver
11
any certified or cashiers' checks received and any funds so wired, in an
aggregate amount equal to the Purchase Price, to the Company on the Purchase
Contract Settlement Date, and shall distribute any funds in respect of the
interest earned from the Permitted Investments to the Purchase Contract Agent
for payment to the relevant Holder.
(b) If neither a Tax Event Redemption or a Successful Initial
Remarketing has occurred, and a Holder of an Income PRIDES fails to notify the
Purchase Contract Agent of its intention to make a Cash Settlement in accordance
with Section 5.3(a)(i) of the Purchase Contract Agreement, such failure shall
constitute an event of default under the Purchase Contract Agreement and
hereunder, and the Holder shall be deemed to have consented to the disposition
of the Pledged Senior Notes pursuant to the remarketing as described in Section
5.3(b) of the Purchase Contract Agreement, which is incorporated herein by
reference. If a Holder of an Income PRIDES does notify the Purchase Contract
Agent as provided in Section 5.3(a)(i) of the Purchase Contract Agreement of its
intention to pay the Purchase Price in cash, but fails to make such payment as
required by Section 5.3(a)(ii) of the Purchase Contract Agreement, such failure
will constitute an event of default under the Purchase Contract Agreement and
hereunder, and the Senior Notes of such a Holder will not be remarketed but
instead the Collateral Agent, for the benefit of the Company, will exercise its
rights as a secured party with respect to such Senior Notes at the written
direction of the Company to retain or dispose of the Collateral in accordance
with applicable law. In addition, in the event of a Failed Secondary Remarketing
as described in Section 5.3(b) of the Purchase Contract Agreement, such Failed
Secondary Remarketing shall constitute an event of default hereunder by such
Holder and the Collateral Agent, for the benefit of the Company, will also
exercise its rights as a secured party with respect to such Senior Notes at the
written direction of the Company to retain or dispose of the Collateral in
accordance with applicable law.
(c) If a Holder of a Growth PRIDES (unless a Tax Event Redemption or
a Successful Initial Remarketing has occurred) fails to notify the Purchase
Contract Agent of such Holder's intention to make a Cash Settlement in
accordance with Section 5.3(d)(i) of the Purchase Contract Agreement, or if a
Holder of a Growth PRIDES does notify the Purchase Contract Agent as provided in
paragraph 5.3(d)(i) of the Purchase Contract Agreement of its intention to pay
the Purchase Price in cash, but fails to make such payment as required by
paragraph 5.3(d)(ii) of the Purchase Contract Agreement, such failure shall
constitute an event of default hereunder by such Holder and upon the maturity of
any Pledged Treasury Securities, if any, held by the Collateral Agent on the
Business Day immediately preceding the Purchase Contract Settlement Date, the
principal amount at maturity of the Pledged Treasury Securities or the Pledged
Portfolio Interests, received by the Collateral Agent shall, upon written
direction of the Company, be invested promptly in any Permitted Investments. On
the Purchase Contract Settlement Date, an amount equal to the Purchase Price
will be remitted to the Company as payment thereof. In the event the sum of the
proceeds from the related Pledged Treasury Securities and the investment
earnings earned from such investments is in excess of the aggregate Purchase
Price of the Purchase Contracts being settled thereby, the Collateral Agent will
distribute such excess to the Purchase Contract Agent for the benefit of the
Holder of the related Growth PRIDES or Income PRIDES when received.
Section 4.5 EARLY SETTLEMENT. Upon written notice to the Collateral Agent
by the Purchase Contract Agent that one or more Holders of Securities have
elected to effect Early
12
Settlement of their respective obligations under the Purchase Contracts
forming a part of such Securities in accordance with the terms of the
Purchase Contracts and the Purchase Contract Agreement (setting forth the
number of such Purchase Contracts as to which such Holders have elected to
effect Early Settlement), and that the Purchase Contract Agent has received
from such Holders, and paid to the Company as confirmed in writing by the
Company, the related Early Settlement Amounts pursuant to the terms of the
Purchase Contracts and the Purchase Contract Agreement and that all
conditions to such Early Settlement have been satisfied, then the Collateral
Agent shall release from the Pledge, (a) Pledged Senior Notes or the Pledged
Portfolio Interests, as the case may be, in the case of a Holder of Income
PRIDES or (b) Pledged Treasury Securities in the case of a Holder of Growth
PRIDES, as the case may be, with a principal amount at maturity equal to the
product of (i) the Stated Amount times (ii) the number of such Purchase
Contracts as to which such Holders have elected to effect Early Settlement
and shall Transfer all such Pledged Senior Notes, the Pledged Portfolio
Interests, or Pledged Treasury Securities, as the case may be, free and clear
of the Pledge created hereby, to the Purchase Contract Agent for the benefit
of the Holders.
Section 4.6 APPLICATION OF PROCEEDS SETTLEMENT. (a) In the event a Holder
of Income PRIDES (unless a Tax Event Redemption or a Successful Initial
Remarketing has occurred) has not elected to make an effective Cash Settlement
by notifying the Purchase Contract Agent in the manner provided for in paragraph
5.3(a)(i) in the Purchase Contract Agreement or has not made an Early Settlement
of the Purchase Contract(s) underlying its Income PRIDES, such Holder shall be
deemed to have elected to pay for the Common Stock to be issued under such
Purchase Contract(s) from the Proceeds of the related Pledged Senior Notes. The
Collateral Agent shall, by 10:00 a.m.,
New York City time, on the fourth
Business Day immediately preceding the Purchase Contract Settlement Date,
without any instruction from such Holder of Income PRIDES, present the related
Pledged Senior Notes to the Remarketing Agent for remarketing. Upon receiving
such Pledged Senior Notes, the Remarketing Agent, pursuant to the terms of the
Remarketing Agreement and the Remarketing Underwriting Agreement, will use its
reasonable efforts to remarket such Pledged Senior Notes on such date at a price
not less than approximately 100.5% of the aggregate Value of such Pledged Senior
Notes, plus accrued and unpaid interest, if any, thereon. After deducting as the
remarketing fee an amount not exceeding 25 basis points (0.25%) of the aggregate
Value of the Pledged Senior Notes from any amount of such Proceeds in excess of
the aggregate Value, plus such accrued and unpaid interest of the remarketed
Pledged Senior Notes, the Remarketing Agent will remit the entire amount of the
Proceeds of such remarketing to the Collateral Agent. On the Purchase Contract
Settlement Date, the Collateral Agent shall apply that portion of the Proceeds
from such remarketing equal to the aggregate Value, plus such accrued and unpaid
interest of such Pledged Senior Notes, to satisfy in full the obligations of
such Holders of Income PRIDES to pay the Purchase Price to purchase the Common
Stock under the related Purchase Contracts. The remaining portion of such
Proceeds, if any, shall be distributed by the Collateral Agent to the Purchase
Contract Agent for payment to the Holders. If the Remarketing Agent advises the
Collateral Agent in writing that it cannot remarket the related Pledged Senior
Notes of such Holders of Income PRIDES at a price not less than 100% of the
aggregate Value of such Pledged Senior Notes plus any accrued and unpaid
interest, thus resulting in a Failed Secondary Remarketing and an event of
default under the Purchase Contract Agreement and hereunder, the Collateral
Agent, for the benefit of the Company will, at the written direction of the
Company, retain or dispose of the Pledged Senior
13
Notes in accordance with applicable law and satisfy in full, from any such
disposition or retention, such Holder's obligation to pay the Purchase Price
for the Common Stock.
(b) In the event a Holder of Growth PRIDES (if a Tax Event
Redemption or a Successful Initial Remarketing has occurred) has not made an
Early Settlement of the Purchase Contract(s) underlying its Growth PRIDES, such
Holder shall be deemed to have elected to pay for the Common Stock to be issued
under such Purchase Contract(s) from the Proceeds of the related Pledged
Treasury Securities or the appropriate Portfolio Interests, as the case may be.
On the Business Day immediately prior to the Purchase Contract Settlement Date,
the Collateral Agent shall invest the Cash proceeds of the maturing Pledged
Treasury Securities, or the maturing appropriate Portfolio Interests, as the
case may be, in any overnight Permitted Investments. Without receiving any
instruction from any such Holder of Growth PRIDES, the Collateral Agent shall
apply the Proceeds of the related Pledged Treasury Securities or appropriate
Portfolio Interests to the settlement of such Purchase Contracts on the Purchase
Contract Settlement Date.
In the event the sum of the Proceeds from the related Pledged Treasury
Securities or appropriate Portfolio Interests, as the case may be, and the
investment earnings from the investment in overnight Permitted Investments is in
excess of the aggregate Purchase Price of the Purchase Contracts being settled
thereby, the Collateral Agent shall distribute such excess, when received, to
the Purchase Contract Agent for the benefit of the Holder.
(c) Pursuant to the Remarketing Agreement and subject to the terms
of the Remarketing Underwriting Agreement, on or prior to the fifth Business Day
immediately preceding the Initial Remarketing Date or the Secondary Remarketing
Date, as applicable, but no earlier than the Payment Date immediately preceding
such date, holders of Separate Senior Notes may elect to have their Separate
Senior Notes remarketed by delivering their Separate Senior Notes, together with
a notice of such election, substantially in the form of Exhibit C hereto, to the
Custodial Agent. The Custodial Agent will hold such Separate Senior Notes in an
account separate from the Collateral Account. A holder of Separate Senior Notes
electing to have its Separate Senior 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 second
Business Day immediately preceding the Initial Remarketing Date or the Secondary
Remarketing Date, as applicable, upon which notice the Custodial Agent will
return such Separate Senior Notes to such holder. On the Business Day
immediately preceding the Initial Remarketing Date or the Secondary Remarketing
Date, as applicable, the Custodial Agent shall notify the Remarketing Agent of
the aggregate principal amount of the separate Notes to be remarketed and will
deliver to the Remarketing Agent for remarketing all Separate Senior Notes
delivered to the Custodial Agent pursuant to this Section 4.6(c) and not
withdrawn pursuant to the terms hereof prior to such date. The portion of the
proceeds from such remarketing equal to the aggregate Value of such Separate
Senior Notes will automatically be remitted by the Remarketing Agent to the
Custodial Agent for the benefit of the holders of such Separate Senior Notes. In
addition, after deducting as the remarketing fee an amount not exceeding 25
basis points (0.25%) of the Value of the remarketed Separate Senior Notes, from
any amount of such proceeds in excess of the aggregate Value of the remarketed
Separate Senior Notes plus any accrued and unpaid interest thereon, the
Remarketing Agent will remit to the Custodial Agent the remaining portion of the
proceeds, if any, for the benefit of such holders. If, despite using its
14
reasonable efforts, the Remarketing Agent advises the Custodial Agent in writing
that it cannot remarket the related Separate Senior Notes of such holders at a
price not less than 100% of the aggregate Value of such Separate Senior Notes
plus accrued and unpaid interest and thus resulting in a Failed Initial
Remarketing or a Failed Secondary Remarketing, the Remarketing Agent will
promptly return such Senior Notes to the Custodial Agent for redelivery to such
holders.
ARTICLE V
Voting Rights -Senior Notes
Provided no default hereunder or under the Purchase Contract exists, the
Purchase Contract Agent may exercise, or refrain from exercising, any and all
voting and other consensual rights pertaining to the Pledged Senior Notes or any
part thereof for any purpose not inconsistent with the terms of this Agreement
and in accordance with the terms of the Purchase Contract Agreement; provided,
that the 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 effect on the
value of all or any of the Pledged Senior Notes; and provided, further, that the
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 Senior Notes,
including notice of any meeting at which holders of Senior Notes are entitled to
vote or solicitation of consents, waivers or proxies of holders of Senior Notes,
the Collateral Agent shall use reasonable efforts to send promptly to the
Purchase Contract Agent such notice or communication, and as soon as reasonably
practicable after receipt of a written request therefor from the Purchase
Contract Agent, execute and deliver to the Purchase Contract Agent such proxies
and other instruments in respect of such Pledged Senior Notes (in form and
substance satisfactory to the Collateral Agent) as are prepared by the Purchase
Contract Agent with respect to the Pledged Senior Notes.
ARTICLE VI
Rights and Remedies
Section 6.1 RIGHTS AND REMEDIES OF THE COLLATERAL AGENT. (a) In addition
to the rights and remedies specified in Section 4.4 hereof or otherwise
available at law or in equity, after an event of default hereunder, 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 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 Senior Notes or
other Collateral in full satisfaction of the Holders' obligations under the
Purchase Contracts or (ii) sale of the Pledged Senior Notes or other Collateral
in one or more public or
15
private sales. Each Holder through the Purchase Contract Agent agrees and
acknowledges that the Collateral is of a type customarily sold in a
recognized market and that, accordingly, no notice of intended disposition of
the Collateral need be given by the Collateral Agent.
(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 Portfolio Interests or on account
of principal payments of any Pledged Treasury Securities as provided in Article
III hereof in satisfaction of the obligations of the Holder of Growth PRIDES of
which such Pledged Treasury Securities or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as applicable, is a part under the related
Purchase Contracts, the inability to make such payments shall constitute an
event of default hereunder and the Collateral Agent shall have and may exercise,
with reference to such Pledged Treasury Securities or such Pledged Portfolio
Interests, 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 Stated Amount of or,
interest on, the Pledged Senior Notes, (ii) the principal amount at maturity of
the Pledged Treasury Securities or (iii) the Pledged Portfolio Interests,
subject, in each case, to the provisions of Article 3, and as otherwise granted
herein.
(d) The Purchase Contract Agent, individually and as
attorney-in-fact for each Holder of Securities, in the event such Holder becomes
the Holder of a Growth PRIDES, agrees that, from time to time, upon the written
request of the Company, Collateral Agent, the Purchase Contract Agent or such
Holder shall execute and deliver such further documents and do such other acts
and things as the Collateral Agent 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 Purchase Contract Agent shall have no
liability to any Holder for executing any documents or taking any such acts
requested by the Collateral Agent hereunder, except for liability for its own
negligent act, its own negligent failure to act, its bad faith or its own
willful misconduct.
Section 6.2 TAX EVENT REDEMPTION. Upon the occurrence of a Tax Event
Redemption prior to the Purchase Contract Settlement Date, the aggregate
Redemption Price payable on the Tax Event Redemption Date with respect to the
Pledged Senior Notes shall be delivered to the Collateral Agent by the Trustee
on or prior to 12:00 p.m., New York City time, by check or wire transfer in
immediately available funds to the Collateral Agent or such other account as may
be designated in writing by the Collateral Agent in exchange for the Pledged
Senior 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 Redemption Amount
with respect to the Pledged Senior Notes to purchase from the Quotation Agent
the Treasury Portfolio and promptly remit the remaining portion of such
Redemption Price to the Purchase Contract Agent for payment to the Holders of
Income PRIDES. The Collateral Agent shall Transfer (or cause to be transferred)
Portfolio Interests
16
representing 100% of the entire Treasury Portfolio or to the Collateral
Account pursuant to the Pledge hereunder, in substitution for the Pledged
Senior Notes. Thereafter, the Collateral Agent shall have such security
interests, rights and obligations with respect to the Portfolio Interests as
it had in respect of the Pledged Senior Notes as provided herein, and any
reference herein to the Senior Notes shall be deemed to be reference to such
Portfolio Interests, and any reference herein to interest on the Senior Notes
shall be deemed to be a reference to distributions on such Portfolio
Interests. During any period greater than one Business Day between the
receipt of the Redemption Price in Cash upon the Tax Event Redemption and the
payment of all or a portion thereof to the Quotation Agent for the purchase
of the Treasury Portfolio, as provided above, the Collateral Agent shall
promptly invest any such Cash in Permitted Investments. Upon receipt of the
Proceeds upon the maturity of such Permitted Investments on the date of the
purchase of the Treasury Portfolio as described above, the Collateral Agent
(i) shall pay such proceeds (and deliver any certified or cashiers' checks
received and any funds so wired) in an amount equal to the purchase price of
the Treasury Portfolio to the Quotation Agent and (ii) and shall distribute
any funds in respect of the interest earned from the Permitted Investments to
the Purchase Contract Agent for payment to the relevant Holders.
Section 6.3 INITIAL REMARKETING. The Collateral Agent shall, by 10:00
a.m., New York City time, on the fourth Business Day immediately preceding
August 17, 2004, without any instruction from any Holder of Income PRIDES,
present the Pledged Senior Notes to the Remarketing Agent for remarketing.
Upon receiving such Pledged Senior Notes, the Remarketing Agent, pursuant to
the terms of the Remarketing Agreement, will use its reasonable efforts to
remarket such Pledged Notes on such date at a price of approximately 100.5%
(but not less than 100%) of the Treasury Portfolio Purchase Price. After
deducting as the Remarketing Fee an amount not exceeding 25 basis points
(0.25%) of the Treasury Portfolio Purchase Price from any amount of such
Proceeds in excess of the Treasury Portfolio Purchase Price, the Remarketing
Agent will remit the entire amount of the Proceeds of such remarketing to the
Collateral Agent on or prior to 12:00 p.m., New York City time, by check or
wire transfer in immediately available funds to the Collateral Account or
such other account and at such account as may be designated by the Collateral
Agent in exchange for the Pledged Senior Notes. In the event the Collateral
Agent receives such Proceeds, the Collateral Agent will, at the written
direction of the Company, apply an amount equal to the Treasury Portfolio
Purchase Price to purchase from the Quotation Agent the Portfolio Interests
and promptly remit the remaining portion of such Proceeds to the Purchase
Contract Agent for payment to the Holders of Income PRIDES. The Collateral
Agent shall Transfer the Portfolio Interests to the Collateral Account to
secure the obligation of all Holders of Income PRIDES to purchase Common
Stock of the Company under the Purchase Contracts constituting a part of such
Income PRIDES, in substitution for the Pledged Senior Notes. Thereafter the
Collateral Agent shall have such security interests, rights and obligations
with respect to the Portfolio Interests as it had in respect of the Pledged
Senior Notes as provided herein, and any reference herein to the Senior Notes
shall be deemed to be reference to such Portfolio Interests, and any
reference herein to interest on the Senior Notes shall be deemed to be a
reference to distributions on such Portfolio Interests. During any period
greater than one Business Day between the receipt of such Proceeds from the
Initial Remarketing and the payment of all or a portion thereof to the
Quotation Agent for the purchase of the Treasury Portfolio, as provided
above, the Collateral Agent (i) shall promptly invest any such Cash in
Permitted Investments. Upon receipt of the proceeds upon the maturity of such
Permitted Investments on the date of the purchase of the Treasury Portfolio
as described
17
above, the Collateral Agent shall pay such proceeds (and deliver any
certified or cashiers' checks received and any funds so wired) in an amount
equal to the purchase price of the Treasury Portfolio to the Quotation Agent
and (ii) and shall distribute any funds in respect of the interest earned
from the Permitted Investments to the Purchase Contract Agent for payment to
the relevant Holders.
Section 6.4 SUBSTITUTIONS. Whenever a Holder has the right to
substitute Treasury Securities or Senior Notes (or Portfolio Interests), 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.
ARTICLE VII
Representations and Warranties; Covenants
Section 7.1 REPRESENTATIONS AND WARRANTIES. The Holders from time to time,
acting through the Purchase Contract Agent as their attorney-in-fact (it being
understood that the Purchase Contract Agent shall not be liable for any
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 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
Purchase Contract Agent as their attorney-in-fact (it being understood that the
Purchase Contract Agent
18
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 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;
(b) neither the Purchase Contract Agent nor such Holders will sell
or otherwise dispose (or attempt to dispose) of the Collateral or any part
of it except for the beneficial interest therein, subject to the pledge
hereunder, transferred in connection with the Transfer of the Securities;
and
(c) if any Collateral is delivered to any Holder or to the Purchase
Contract Agent, such Holder or the Purchase Contract Agent will deliver
the sum to the Collateral Agent, properly indorsed when required, and in
the form received.
ARTICLE VIII
The Collateral Agent
Section 8.1 APPOINTMENT, POWERS AND IMMUNITIES. 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,
together with such other powers as are reasonably incidental thereto. Each of
the Collateral Agent, the Custodial Agent and the Securities Intermediary:
(a) 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; (b) 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 Income PRIDES, Growth
PRIDES or the Purchase Contract Agreement, or for the value, validity,
effectiveness, genuineness, enforceability or sufficiency of this Agreement
(other than as against the Collateral Agent), the Securities or the Purchase
Contract Agreement or any other document referred to or provided for herein
or therein or for any failure by the Company or any other Person (except the
Collateral Agent, the 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, maintenance
of any security interest created hereunder; (c) shall not be required to
initiate or conduct any litigation or collection proceedings hereunder
(except in the case of the Collateral Agent, pursuant to directions furnished
under Section 8.2 hereof, subject to Section 8.6 hereof); (d) 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 negligence, bad faith
or willful misconduct; and (e) 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 Securities 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.
19
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. Notwithstanding the foregoing, the Collateral
Agent, the Custodial Agent, the Purchase Contract Agent and Securities
Intermediary, each in its individual capacity, hereby waive any right of
setoff, bankers lien, liens or perfection rights as securities intermediary
or any counterclaim with respect to any of the Collateral.
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 be adequately indemnified 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 BY COLLATERAL AGENT. Each of the Securities
Intermediary, the Custodial Agent and the Collateral Agent 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) believed by it in good faith 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
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 their investments in and generally engage in any kind of banking,
trust or other business with the Purchase Contract Agent, any Holder of Income
PRIDES or Growth PRIDES and any holder of Separate Senior 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 Purchase Contract Agent, any Holder of Income PRIDES or Growth PRIDES or any
holder of Separate Senior Notes without having to account for the same to the
Company; provided that each of the Securities Intermediary, the Custodial Agent
and the Collateral Agent covenants and agrees with the Company that it shall not
accept, receive or permit there to be created in favor of itself and shall take
no affirmative action to permit there to
20
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 Securities
Intermediary, the Custodial Agent or the Collateral Agent shall be required
to keep itself informed as to the performance or observance by the Purchase
Contract Agent or any Holder of Securities of this Agreement, the Purchase
Contract Agreement, the Income PRIDES or Growth PRIDES or any other document
referred to or provided for herein or therein or to inspect the properties or
books of the Purchase Contract Agent or any Holder of Income PRIDES or Growth
PRIDES. 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 Purchase Contract Agent, any
Holder of Income PRIDES or Growth PRIDES or any holder of Separate Senior
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: (i) to pay
each of the Collateral Agent and the Custodial Agent from time to time such
compensation as shall be agreed in writing between the Company and the
Collateral Agent or the Custodial Agent, as the case may be, for all services
rendered by each of them hereunder and (ii) to indemnify the Collateral
Agent, the Custodial Agent and the Securities Intermediary for, and to hold
each of them harmless from and against, any loss, liability or reasonable
out-of-pocket expense incurred without negligence, willful misconduct or bad
faith 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. 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.
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 and the Custodial Agent shall
be entitled, after prompt notice to the Company and the 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 neither the Collateral Agent nor the Custodial
Agent 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 and the Custodial Agent shall be entitled to
refuse to act until either (i) such conflicting or adverse claims or demands
shall have been finally determined by a court of competent jurisdiction or
settled by agreement between the conflicting parties as evidenced in a writing,
satisfactory to the Collateral Agent or the Custodial
21
Agent, as the case may be, or (ii) the Collateral Agent or the Custodial
Agent, as the case may be, shall have received security or an indemnity
reasonably satisfactory to the Collateral Agent or the Custodial Agent, as
the case may be, sufficient to save the Collateral Agent or the Custodial
Agent, as the case may be, harmless from and against any and all loss,
liability or reasonable out-of-pocket expense which the Collateral Agent or
the Custodial Agent, as the case may be, may incur by reason of its acting
without bad faith, willful misconduct or gross negligence. The Collateral
Agent or the Custodial Agent may in addition elect to commence an
interpleader action or seek other judicial relief or orders as the Collateral
Agent or the Custodial Agent, as the case may be, may deem necessary.
Notwithstanding anything contained herein to the contrary, neither the
Collateral Agent nor the Custodial Agent shall be required to take any action
that is in its opinion contrary to law or to the terms of this Agreement, or
which would in its opinion subject it or any of its officers, employees or
directors to liability.
Section 8.8 RESIGNATION OF COLLATERAL AGENT. Subject to the appointment
and acceptance of a successor Collateral Agent or Custodial Agent as provided
below, (a) the Collateral Agent and the Custodial Agent may resign at any
time by giving not less than 20 days prior notice thereof to the Company and
the Purchase Contract Agent as attorney-in-fact for the Holders of Income
PRIDES or Growth PRIDES, (b) the Collateral Agent and the Custodial Agent may
be removed at any time by the Company and (c) if the Collateral Agent or the
Custodial Agent fails to perform any of its material obligations hereunder in
any material respect for a period of not less than 20 days after receiving
written notice of such failure by the Purchase Contract Agent and such
failure shall be continuing, the Collateral Agent or the Custodial Agent may
be removed by the Purchase Contract Agent. The Purchase Contract Agent shall
promptly notify the Company of any removal of the Collateral Agent pursuant
to clause (c) of the immediately preceding sentence. Upon any such
resignation or removal, the Company shall have the right to appoint a
successor Collateral Agent or Custodial Agent, as the case may be. If no
successor Collateral Agent or Custodial Agent, as the case may be, shall have
been so appointed and shall have accepted such appointment within 30 days
after the retiring Collateral Agent's or Custodial Agent's giving of notice
of resignation or such removal, then the retiring Collateral Agent or
Custodial Agent, as the case may be, may, at the expense of the Company,
petition any court of competent jurisdiction for the appointment of a
successor Collateral Agent or Custodial Agent, as the case may be. Each of
the Collateral Agent and the Custodial Agent shall be a bank which has an
office in New York, New York with a combined capital and surplus of at least
$75,000,000. Upon the acceptance of any appointment as Collateral Agent or
Custodial Agent, as the case may be, hereunder by a successor Collateral
Agent or Custodial Agent, as the case may be, such successor shall thereupon
succeed to and become vested with all the rights, powers, privileges and
duties of the retiring Collateral Agent or Custodial Agent, as the case may
be, and the retiring Collateral Agent or Custodial Agent, as the case may be,
shall take all appropriate action to transfer any money and property held by
it hereunder (including the Collateral) to such successor. The retiring
Collateral Agent or Custodial Agent shall, upon such succession, be
discharged from its duties and obligations as Collateral Agent or Custodial
Agent hereunder. After any retiring Collateral Agent's or Custodial Agent's
resignation hereunder as Collateral Agent or Custodial Agent, the provisions
of this Section 8.8 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 or Custodial Agent. 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.
22
Section 8.9 RIGHT TO APPOINT AGENT OR ADVISOR. The Collateral Agent
shall have the right to appoint agents or advisors in connection with any of
its duties hereunder, and the Collateral Agent shall not be liable for any
action taken or omitted by, or in reliance upon the advice of, such agents or
advisors selected in good faith. The appointment of agents pursuant to this
Section 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 8 shall survive
termination of this Agreement and the resignation or removal of the
Collateral Agent or the Custodial Agent.
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, incurred without any act or deed that is found to be
attributable to gross negligence, bad faith or willful misconduct on the part
of the Collateral Agent, the Custodial Agent or the Securities Intermediary.
ARTICLE IX
Amendment
Section 9.1 AMENDMENT WITHOUT CONSENT OF HOLDERS. Without the consent
of any Holders or the holders of any Separate Senior Notes, the Company, the
Collateral Agent, the Custodial Agent, the Securities Intermediary and the
Purchase Contract Agent, at any time and from time to time, may amend this
Agreement, in form satisfactory to the Company, the Collateral Agent, the
Custodial Agent, the Securities Intermediary and the Purchase Contract Agent,
for any of the following purposes:
(1) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the
covenants of the Company; or
(2) to add to the covenants of the Company for the benefit of
the Holders, or to surrender any right or power herein conferred
upon the Company so long as such covenants or such surrender do not
adversely affect the validity, perfection or priority of the
security interests granted or created hereunder; or
(3) to evidence and provide for the acceptance of appointment
hereunder by a successor Collateral Agent, Securities Intermediary
or Purchase Contract Agent; or
(4) to cure any ambiguity, to correct or supplement any
provisions herein which may be inconsistent with any other such
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.
23
Section 9.2 AMENDMENT WITH CONSENT OF HOLDERS. With the consent of the
Holders of not less than a majority of the Purchase Contracts at the time
outstanding, by Act of said Holders delivered to the Company, the Purchase
Contract Agent or the Collateral Agent, as the case may be, the Company, when
duly authorized, the Company, the 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 Income PRIDES and
Growth PRIDES; provided, however, that no such supplemental agreement shall,
without the consent of the Holder of each Outstanding Income PRIDES and
Growth PRIDES adversely affected thereby,
(1) change the amount or type of Collateral underlying an
Income PRIDES or Growth PRIDES (except for the rights of holders of
Income PRIDES to substitute the Treasury Securities for the Pledged
Senior Notes (or Pledged Portfolio Interests), or the rights of
Holders of Growth PRIDES to substitute Senior Notes (or Portfolio
Interests) for the Pledged Treasury Securities), impair the right of
the Holder of any Income PRIDES or Growth PRIDES to receive
distributions on the underlying Collateral or otherwise adversely
affect the Holder's rights in or to such Collateral; or
(2) otherwise effect any action that would require the consent
of the Holder of each Outstanding Income PRIDES or Growth PRIDES
affected thereby pursuant to the Purchase Contract Agreement if such
action were effected by an agreement supplemental thereto; or
(3) reduce the percentage of Purchase Contracts the consent of
whose Holders is required for any such amendment.
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 Purchase Contract Agent shall be entitled to
receive and (subject to Section 6.1 hereof, with respect to the Collateral
Agent, and Section 7.1 of the Purchase Contract Agreement, with respect to
the Purchase Contract Agent) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such amendment is authorized
or permitted by this Agreement and that all conditions precedent, if any, to
the execution and delivery of such amendment have been satisfied.
Section 9.4 EFFECT OF AMENDMENTS. Upon the execution of any amendment
under this Article 9, this Agreement shall be modified in accordance
therewith, and such amendment shall form a part of this Agreement for all
purposes; and every Holder of Certificates theretofore or thereafter
authenticated, executed on behalf of the Holders and delivered under the
Purchase Contract Agreement shall be bound thereby.
24
Section 9.5 REFERENCE TO AMENDMENTS. Security 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 Purchase Contract Agent, bear a
notation in form approved by the Purchase Contract Agent and the Collateral
Agent as to any matter provided for in such amendment. If the Company shall
so determine, new Security Certificates so modified as to conform, in the
opinion of the Collateral Agent, the Purchase Contract Agent and the Company,
to any such amendment may be prepared and executed by the Company and
authenticated, executed on behalf of the Holders and delivered by the
Purchase Contract Agent in accordance with the Purchase Contract Agreement in
exchange for Outstanding Security Certificates.
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 and the Holders from time to
time acting through the Purchase Contract Agent, as their attorney-in-fact,
in connection with the establishment and maintenance of the Collateral
Account.
Section 10.3 NOTICES. All notices, requests, consents and other
communications provided for herein (including, without limitation, any
modifications of, or waivers or consents under, this Agreement) shall be
given or made in writing (including, without limitation, by telecopy)
delivered to the intended recipient at the "Address for Notices" specified
below its name on the signature pages hereof or, as to any party, at such
other address as shall be designated by such party in a notice to the other
parties. Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given when transmitted by
telecopier or personally delivered or, in the case of a mailed notice, upon
receipt, in each case given or addressed as aforesaid.
Section 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 Purchase Contract Agent, and the Holders from time to
time of the Income PRIDES and Growth PRIDES, by their acceptance of the same,
shall be deemed to have agreed to be bound by the provisions hereof and to
have ratified the agreements of, and the grant of the Pledge hereunder by,
the Purchase Contract Agent.
25
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 and the Custodial Agent for: (a) all reasonable
out-of-pocket costs and expenses of the Collateral Agent and the Custodial
Agent (including, without limitation, the reasonable fees and expenses of
counsel to the Collateral Agent and the Custodial Agent), 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 Securities to satisfy
its obligations under the Purchase Contracts forming a part of the Securities
and (ii) the enforcement of this Section 10.7; and (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 Purchase Contracts or the Securities 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 Securities under the related Purchase Contracts,
or any other amendment or waiver of any term of, or any consent to any
departure from any requirement of, the Purchase Contract Agreement or any
Purchase Contract or any other agreement or instrument relating thereto;
or
(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 CONSENT TO JURISDICTION; MISCELLANEOUS. Each of the parties
hereto hereby expressly and irrevocably submits to the non-exclusive
jurisdiction of any competent court in the place of its domicile and any United
States Federal or New York State court sitting in the Borough of Manhattan in
The City of New York in any action, suit or proceeding arising out of
26
or relating to this Underwriting Agreement or the transactions contemplated
hereby to the extent that such court has subject matter jurisdiction over the
controversy, and expressly and irrevocably waives, to the extent permitted
under applicable law, any immunity from the jurisdiction thereof and any
claim or defense in such action, suit or proceeding based on a claim of
improper venue, FORUM NON CONVENIENS or any similar basis to which it might
otherwise be entitled in any such action, suit or proceeding.
Section 10.10 WAIVER OF IMMUNITIES. To the extent that the Company or
any of its properties, assets or revenues may have or may hereafter become
entitled to, or have attributed to them, any right of immunity, on the
grounds of sovereignty, from any legal action, suit or proceeding, from
set-off or counterclaim, from the jurisdiction of any court, from service of
process, from attachment upon or prior to judgment, or from attachment in aid
of execution of judgment, or from execution of judgment, other legal process
or proceeding for the giving of any relief or for the enforcement of any
judgment, in any jurisdiction in which proceedings may at any time be
commenced, with respect to their obligations, liabilities or any other matter
under or arising out of or in connection with this Agreement or any
additional agreement, the Company hereby irrevocably and unconditionally, to
the extent permitted by applicable law, waives and agrees not to plead or
claim any such immunity and consents to such relief and enforcement.
27
\
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
AFFILIATED MANAGERS GROUP, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. Crate
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇. Crate
Title: Chief Financial Officer
Address for Notices:
Affiliated Managers Group, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇'▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Telecopy: ▇▇▇-▇▇▇-▇▇▇▇
First Union National Bank, as Purchase
Contract Agent, Collateral Agent,
Custodial Agent, Securities Intermediary
and as attorney-in-fact of the Holders
from time to time of the Income PRIDES
and Growth PRIDES
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇
Title: Vice President
Address for Notices:
First Union National Bank
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust -- NY 4040
28
EXHIBIT A
INSTRUCTION FROM PURCHASE CONTRACT AGENT TO COLLATERAL AGENT
First Union National Bank
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust -- NY 4040
Re: FELINE PRIDES of Affiliated Managers Group, Inc. (the
"Company")
We hereby notify you in accordance with Section [4.1] [4.2] of the
Pledge Agreement, dated as of December 21, 2001 (the "
Pledge Agreement")
among the Company, yourselves, as Collateral Agent, Custodial Agent and
Securities Intermediary and ourselves, as Purchase Contract Agent and as
attorney-in-fact for the holders of [Income PRIDES] [Growth PRIDES] from time
to time, that the holder of the Securities listed below (the "Holder") has
elected to substitute [$_____ aggregate principal amount at maturity of
Treasury Securities] [$_______Stated Amount of Senior Notes or Portfolio
Interests in exchange for an equal Value of [Pledged Senior Notes or Portfolio
Interests, as the case may be] [Pledged Treasury Securities] held by you in
accordance with the
Pledge Agreement and has delivered to us a notice stating
that the Holder has Transferred [Treasury Securities] [Senior Notes or
Portfolio Interests] to you, as Collateral Agent. We hereby instruct you, upon
receipt of such [Pledged Treasury Securities] [Pledged Senior Notes or
Portfolio Interests], to release the [Senior Notes or Portfolio Interests]
[Treasury Securities] related to such [Income PRIDES] [Growth PRIDES] to us in
accordance with the Holder's instructions. Capitalized terms used herein but
not defined shall have the meaning set forth in the
Pledge Agreement.
Date:
--------------------------- -------------------------------
By:
----------------------------------
Name:
Title:
Signature Guarantee:
----------------------------------
A-1
Please print name and address of Registered Holder electing to substitute
[Treasury Securities] [Senior Notes or Portfolio Interests] for the [Pledged
Senior Notes or Portfolio Interests] [Pledged Treasury Securities]:
---------------------------- ------------------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
----------------------------
Address
----------------------------
----------------------------
A-2
EXHIBIT B
INSTRUCTION TO PURCHASE CONTRACT AGENT
First Union National Bank
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust -- NY 4040
Re: FELINE PRIDES of Affiliated Managers Group, Inc. (the
"Company")
The undersigned Holder hereby notifies you that it has delivered to First
Union National Bank, as Collateral Agent, [$_______ aggregate principal amount
at maturity of Treasury Securities] [$ aggregate Stated Amount of Senior Notes
in exchange for an equal Value of [Pledged Senior Notes or Portfolio Interests]
[Pledged Treasury Securities] held by the Collateral Agent, in accordance with
Section 4.1 of the
Pledge Agreement, dated December 21, 2001 (the "
Pledge
Agreement"), between you, as Purchase Contract Agent and Collateral Agent, and
the Company. The undersigned Holder hereby instructs you as Purchase Contract
Agent to instruct the Collateral Agent to release to you on behalf of the
undersigned Holder the [Pledged Senior Notes or Portfolio Interests] [Pledged
Treasury Securities] related to such [Income PRIDES] [Growth PRIDES].
Capitalized terms used herein but not defined shall have the meaning set forth
in the Pledge Agreement.
Date:
---------------------- -----------------------------------
Signature Guarantee:
----------------------
Please print name and address of Registered Holder:
--------------------------- --------------------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
---------------------------
Address
---------------------------
---------------------------
B-1
EXHIBIT C
INSTRUCTION TO CUSTODIAL AGENT REGARDING REMARKETING
First Union National Bank
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust -- NY 4040
Re: Senior Notes of Affiliated Managers Group, Inc. (the
"Company")
The undersigned hereby notifies you in accordance with Section 4.6(c) of
the Pledge Agreement, dated as of December 21, 2001 (the "Pledge Agreement"),
among the Company, yourselves, as Collateral Agent, Securities Intermediary and
Custodial Agent, and yourselves, as Purchase Contract Agent and as
attorney-in-fact for the Holders of Income PRIDES and Growth PRIDES from time to
time, that the undersigned elects to deliver $__________ aggregate Stated Amount
of Senior Notes for delivery to the Remarketing Agent on the Business Day
immediately preceding the [Initial Remarketing Date] [Secondary Remarketing
Date] for remarketing pursuant to Section 4.6(c) of the Pledge Agreement. The
undersigned will, upon request of the Remarketing Agent, execute and deliver any
additional documents deemed by the Remarketing Agent or by the Company to be
necessary or desirable to complete the sale, assignment and transfer of the
Senior Notes tendered hereby.
The undersigned hereby instructs you, upon receipt of the Proceeds of such
remarketing from the Remarketing Agent to deliver such Proceeds to the
undersigned in accordance with the instructions indicated herein under "A.
Payment Instructions." The undersigned hereby instructs you, in the event of
Failed [Initial] [Secondary] Remarketing, upon receipt of the Senior Notes
tendered herewith from the Remarketing Agent, to be delivered to the person(s)
and the address(es) indicated herein under "B. Delivery Instructions."
With this notice, the undersigned hereby (i) represents and warrants that
the undersigned has full power and authority to tender, sell, assign and
transfer the Senior Notes tendered hereby and that the undersigned is the record
owner of any Senior Notes tendered herewith in physical form or a participant in
The Depository Trust Company ("DTC") and the beneficial owner of any Senior
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 4.6(c) of the Pledge
Agreement. Capitalized terms used herein but not defined shall have the meaning
set forth in the Pledge Agreement.
C-1
Date:
----------------------------
------------------------------------
By:
--------------------------------
Name:
Title:
Signature Guarantee:
---------------
Please print name and address:
------------------------------ ------------------------------------------
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
----------------------------
(Please Print)
-----------------------------------------
-----------------------------------------
(Zip Code)
----------------------------------------------
(Tax Identification or Social Security Number)
B. DELIVERY INSTRUCTIONS
In the event of a failed Remarketing, Senior Notes which are in physical form
should be delivered to the person(s) set forth below and mailed to the address
set forth below.
Name(s)
--------------------------------
(Please Print)
Address
--------------------------------
(Please Print)
-----------------------------------------
-----------------------------------------
(Zip Code)
----------------------------------------------
(Tax Identification or Social Security Number)
In the event of a failed Remarketing, Senior Notes which are in book-entry form
should be credited to the account at The Depository Trust Company set forth
below.
----------------------
DTC Account Number
Name of Account Party:
---------------------------
C-3
EXHIBIT D
INSTRUCTION TO CUSTODIAL AGENT REGARDING
WITHDRAWAL FROM REMARKETING
First Union National Bank
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust -- NY 4040
Re: Senior Notes of Affiliated Managers Group, Inc. (the
"Company")
The undersigned hereby notifies you in accordance with Section 4.6(c) of
the Pledge Agreement, dated as of December 21, 2001 (the "Pledge Agreement")
among the Company, yourselves, as Collateral Agent, Securities Intermediary and
Custodial Agent and yourselves, as Purchase Contract Agent and as
attorney-in-fact for the Holders of Income PRIDES and Growth PRIDES from time to
time, that the undersigned elects to withdraw the $_____ aggregate principal
amount of Senior Notes delivered to the Custodial Agent on ___________, for
remarketing pursuant to Section 4.6(c) of the Pledge Agreement. The undersigned
hereby instructs you to return such Senior 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
4.6(c) of the Pledge Agreement. Capitalized terms used herein but not defined
shall have the meaning set forth in the Pledge Agreement.
Date:
---------------------- ------------------------------------
By:
----------------------------------
Name:
--------------------------------
Title:
--------------------------------
Signature Guarantee:
----------------------
Please print name and address:
--------------------------- -------------------------------------------
(Name) Social Security or other Taxpayer
-------------------------------------------
Identification Number, if any
D-1
---------------------------------
Address
---------------------------------
---------------------------------
D-2
A. DELIVERY INSTRUCTIONS
In the event of a failed Remarketing, Senior Notes which are in physical form
should be delivered to the person(s) set forth below and mailed to the address
set forth below.
Name(s)
---------------------------
(Please Print)
Address
----------------------------
(Please Print)
--------------------------------------
--------------------------------------
(Zip Code)
----------------------------------------------
(Tax Identification or Social Security Number)
In the event of a failed Remarketing, Senior Notes which are in book-entry
form should be credited to the account at The Depositary Trust Company set
forth below.
------------------------
DTC Account Number
Name of Account Party:
-------------------------
D-3