Exhibit 4.16
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SCOTTISH ANNUITY & LIFE HOLDINGS, LTD.
AND
______, AS PURCHASE CONTRACT AGENT
FORM OF
PURCHASE CONTRACT AGREEMENT
Dated as of ______, 200__
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. Definitions................................................................................1
SECTION 1.02. Compliance Certificates and Opinions......................................................14
SECTION 1.03. Form of Documents Delivered to Purchase Contract Agent....................................15
SECTION 1.04. Acts of Holders; Record Dates.............................................................15
SECTION 1.05. Notices...................................................................................16
SECTION 1.06. Notice to Holders; Waiver.................................................................17
SECTION 1.07. Effect of Headings and Table of Contents..................................................17
SECTION 1.08. Successors and Assigns....................................................................18
SECTION 1.09. Separability Clause.......................................................................18
SECTION 1.10. Benefits of Agreement.....................................................................18
SECTION 1.11. Governing Law.............................................................................18
SECTION 1.12. Legal Holidays............................................................................18
SECTION 1.13. Counterparts..............................................................................19
SECTION 1.14. Inspection of Agreement...................................................................19
SECTION 1.15. Appointment of Financial Institution as Agent for the Company.............................19
SECTION 1.16. No Waiver.................................................................................19
ARTICLE II CERTIFICATE FORMS
SECTION 2.01. Forms of Certificates Generally...........................................................19
SECTION 2.02. Form of Purchase Contract Agent's Certificate of Authentication...........................20
ARTICLE III THE UNITS
SECTION 3.01. Amount; Form and Denominations............................................................20
SECTION 3.02. Rights and Obligations Evidenced by the Certificates......................................21
SECTION 3.03. Execution, Authentication, Delivery and Dating............................................22
SECTION 3.04. Temporary Certificates....................................................................22
SECTION 3.05. Registration; Registration of Transfer and Exchange.......................................23
SECTION 3.06. Book-Entry Interests......................................................................24
SECTION 3.07. Notices to Holders........................................................................25
SECTION 3.08. Appointment of Successor Depositary.......................................................25
SECTION 3.09. Definitive Certificates...................................................................25
SECTION 3.10. Mutilated, Destroyed, Lost and Stolen Certificates........................................26
SECTION 3.11. Persons Deemed Owners.....................................................................27
SECTION 3.12. Cancellation..............................................................................28
SECTION 3.13. Creation of Treasury Units by Substitution of Treasury Securities.........................28
SECTION 3.14. Recreation of Corporate Units.............................................................30
SECTION 3.15. Transfer of Collateral upon Occurrence of Termination Event...............................31
SECTION 3.16. No Consent to Assumption..................................................................32
SECTION 3.17. CUSIP Numbers.............................................................................32
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ARTICLE IV THE NOTES AND APPLICABLE OWNERSHIP INTERESTS IN THE TREASURY PORTFOLIO
SECTION 4.01. Interest Payments; Rights to Interest Payments Preserved..................................32
SECTION 4.02. Notice and Voting.........................................................................33
SECTION 4.03. Special Event Redemption..................................................................34
ARTICLE V THE PURCHASE CONTRACTS
SECTION 5.01. Purchase of Shares of Ordinary Shares.....................................................35
SECTION 5.02. Remarketing; Payment of Purchase Price....................................................38
SECTION 5.03. Issuance of Shares of Ordinary Shares.....................................................46
SECTION 5.04. Adjustment of Settlement Rate.............................................................47
SECTION 5.05. Notice of Adjustments and Certain Other Events............................................56
SECTION 5.06. Termination Event; Notice.................................................................57
SECTION 5.07. Early Settlement..........................................................................57
SECTION 5.08. No Fractional Shares......................................................................60
SECTION 5.09. Charges and Taxes.........................................................................60
SECTION 5.10. Contract Adjustment Payments..............................................................60
SECTION 5.11. Deferral of Contract Adjustment Payments..................................................65
ARTICLE VI REMEDIES
SECTION 6.01. Unconditional Right of Holders to Receive Contract Adjustment Payments and to
Purchase Shares of Ordinary Shares........................................................67
SECTION 6.02. Restoration of Rights and Remedies........................................................67
SECTION 6.03. Rights and Remedies Cumulative............................................................67
SECTION 6.04. Delay or Omission Not Waiver..............................................................67
SECTION 6.05. Undertaking for Costs.....................................................................68
SECTION 6.06. Waiver of Stay or Extension Laws..........................................................68
ARTICLE VII THE PURCHASE CONTRACT AGENT
SECTION 7.01. Certain Duties and Responsibilities.......................................................68
SECTION 7.02. Notice of Default.........................................................................69
SECTION 7.03. Certain Rights of Purchase Contract Agent.................................................69
SECTION 7.04. Not Responsible for Recitals or Issuance of Units.........................................71
SECTION 7.05. May Hold Units............................................................................71
SECTION 7.06. Money Held in Custody.....................................................................72
SECTION 7.07. Compensation and Reimbursement............................................................72
SECTION 7.08. Corporate Purchase Contract Agent Required; Eligibility...................................72
SECTION 7.09. Resignation and Removal; Appointment of Successor.........................................73
SECTION 7.10. Acceptance of Appointment by Successor....................................................74
SECTION 7.11. Merger, Conversion, Consolidation or Succession to Business...............................74
SECTION 7.12. Preservation of Information; Communications to Holders....................................75
SECTION 7.13. No Obligations of Purchase Contract Agent.................................................75
SECTION 7.14. Tax Compliance............................................................................76
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ARTICLE VIII SUPPLEMENTAL AGREEMENTS
SECTION 8.01. Supplemental Agreements Without Consent of Holders........................................76
SECTION 8.02. Supplemental Agreements with Consent of Holders...........................................77
SECTION 8.03. Execution of Supplemental Agreements......................................................78
SECTION 8.04. Effect of Supplemental Agreements.........................................................78
SECTION 8.05. Reference to Supplemental Agreements......................................................78
ARTICLE IX CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 9.01. Covenant Not to Consolidate, Merge, Convey, Transfer or Lease Property Except
under Certain Conditions..................................................................78
SECTION 9.02. Rights and Duties of Successor Person.....................................................79
SECTION 9.03. Officers' Certificate and Opinion of Counsel Given to Purchase Contract Agent.............79
ARTICLE X COVENANTS
SECTION 10.01. Performance under Purchase Contracts......................................................80
SECTION 10.02. Maintenance of Office or Agency...........................................................80
SECTION 10.03. Company to Reserve Ordinary Shares........................................................80
SECTION 10.04. Covenants as to Ordinary Shares...........................................................81
SECTION 10.05. Statements of Officers of the Company as to Default.......................................81
SECTION 10.06. ERISA.....................................................................................81
SECTION 10.07. Tax Treatment.............................................................................81
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EXHIBITS
Exhibit A - Form of Corporate Units Certificate
Exhibit B - Form of Treasury Units Certificate
Exhibit C - Instruction to Purchase Contract Agent
Exhibit D - Notice from Purchase Contract Agent to Holders
Exhibit E - Notice to Settle by Separate Cash
Exhibit F - Notice from Purchase Contract Agent to Collateral Agent
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PURCHASE CONTRACT AGREEMENT, dated as of ______, between Scottish Annuity
& Life Holdings, Ltd., a Cayman Islands exempted company (the "Company"), and
______, a banking corporation with trust powers, duly organized and existing
under the laws of the State of ______, acting as purchase contract agent for the
Holders of Units (as defined herein) from time to time (the "Purchase Contract
Agent").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the Units.
All things necessary to make the Purchase Contracts (as defined herein),
when the Certificates (as defined herein) are executed by the Company and
authenticated, executed on behalf of the Holders and delivered by the Purchase
Contract Agent, as provided in this Agreement, the valid obligations of the
Company, and to constitute these presents a valid agreement of the Company, in
accordance with its terms, have been done. For and in consideration of the
premises and the purchase of the Units by the Holders thereof, it is mutually
agreed as follows:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01. Definitions.
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned to them
in this Article and include the plural as well as the singular, and nouns and
pronouns of the masculine gender include the feminine and neuter genders;
(b) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting principles in
the United States;
(c) the words "herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to any particular
Article, Section, Exhibit or other subdivision; and
(d) the following terms have the meanings given to them in this Section
1.01(d):
"ACCOUNTING EVENT" has the meaning set forth in Section ______ of the
Supplemental Indenture No. 1.
"ACT" has the meaning, with respect to any Holder, set forth in Section
1.04.
"ADJUSTED APPLICABLE MARKET VALUE" has the meaning set forth in Section
5.01.
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"AFFILIATE" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"AGREEMENT" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"APPLICABLE MARKET VALUE" has the meaning set forth in Section 5.01.
"APPLICABLE OWNERSHIP INTEREST" shall mean, with respect to a Corporate
Unit and the Treasury Portfolio contained in a Corporate Unit, (i) a ______%
undivided beneficial ownership interest in $1,000 face amount of U.S. treasury
securities (or principal or interest strips thereof) included in such Treasury
Portfolio that mature on or prior to ______, 200__, and (ii) (x) for the
scheduled Payment Date on the Notes that occurs on the Purchase Contract
Settlement Date, in the case of a Successful Remarketing prior to the Final
Remarketing Date, or (y) for each scheduled Payment Date on the Notes that
occurs after the Special Event Redemption Date to and including the Purchase
Contract Settlement Date, in the case of a Special Event Redemption, a ______%
undivided beneficial ownership interest in $1,000 face amount of U.S. treasury
securities (or principal or interest strips thereof) included in such Treasury
Portfolio that mature on or prior to the business day immediately preceding such
scheduled Payment Date.
"APPLICABLE PRINCIPAL AMOUNT" means the aggregate principal amount of the
Notes that are components of Corporate Units.
"APPLICANTS" has the meaning set forth in Section 7.12(b).
"BANKRUPTCY CODE" means title 11 of the United States Code, or any other
law of the United States that from time to time provides a uniform system of
bankruptcy laws.
"BASE INDENTURE" means the Subordinated Indenture, dated as of April
______, 2003, between the Company and the Indenture Trustee (including any
provisions of the TIA that are deemed incorporated therein).
"BENEFICIAL OWNER" means, with respect to a Book-Entry Interest, a Person
who is the beneficial owner of such Book-Entry Interest as reflected on the
books of the Depositary or on the books of a Person maintaining an account with
such Depositary (directly as a Depositary Participant or as an indirect
participant, in each case in accordance with the rules of such Depositary).
"BOARD OF DIRECTORS" means the board of directors of the Company or a
duly authorized committee of that board.
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"BOARD RESOLUTION" means one or more resolutions of the Board of
Directors, a copy of which has been certified by the Secretary or an Assistant
Secretary of the Company, to have been duly adopted by the Board of Directors
and to be in full force and effect on the date of such certification and
delivered to the Purchase Contract Agent.
"BOOK-ENTRY INTEREST" means a beneficial interest in a Global
Certificate, registered in the name of a Depositary or a nominee thereof,
ownership and transfers of which shall be maintained and made through book
entries by such Depositary as described in Section 3.06.
"BUSINESS DAY" or "business day" means any day other than a Saturday or
Sunday or a day on which banking institutions or trust companies in
New York
City,
New York are authorized or required by applicable law to remain closed or
a day on which the Indenture Trustee or the Collateral Agent is closed for
business; PROVIDED THAT for purposes of the second paragraph of Section 1.12
only, the term "Business Day" shall also be deemed to exclude any day on which
DTC is closed.
"CASH MERGER" has the meaning set forth in Section 5.04(b)(2).
"CASH MERGER EARLY SETTLEMENT" has the meaning set forth in Section
5.04(b)(2).
"CASH MERGER EARLY SETTLEMENT DATE" has the meaning set forth in Section
5.04(b)(2).
"CASH SETTLEMENT" has the meaning set forth in Section 5.02(c)(i).
"CERTIFICATE" means a Corporate Units Certificate or a Treasury Units
Certificate.
"CLOSING PRICE" has the meaning set forth in Section 5.01(a).
"CODE" means the Internal Revenue Code of 1986, as amended.
"COLLATERAL" has the meaning set forth in Section 1.01(d) of the Pledge
Agreement.
"COLLATERAL ACCOUNT" has the meaning set forth in Section 1.01(d) of the
Pledge Agreement.
"COLLATERAL AGENT" means ______, a banking corporation with trust powers,
duly organized and existing under the laws of the State of ______, as Collateral
Agent under the Pledge Agreement until a successor Collateral Agent shall have
become such pursuant to the applicable provisions of the Pledge Agreement, and
thereafter "Collateral Agent" shall mean the Person who is then the Collateral
Agent thereunder.
"COLLATERAL SUBSTITUTION" means (i) with respect to a Corporate Unit, (x)
the substitution for the Pledged Note included in such Corporate Unit by
Treasury Securities in an aggregate principal amount at maturity equal to the
aggregate principal amount of such Pledged Note, or (y) the substitution for the
Pledged Applicable Ownership Interest in the Treasury
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Portfolio included in such Corporate Unit by Treasury Securities in an aggregate
principal amount equal to such Pledged Applicable Ownership Interest in the
Treasury Portfolio, or (ii) with respect to a Treasury Unit, (x) the
substitution for the Pledged Treasury Securities included in such Treasury Unit
(if the Applicable Ownership Interest in the Treasury Portfolio has not replaced
the Note as a component of Corporate Units) by Notes in an aggregate principal
amount equal to the aggregate principal amount at stated maturity of the Pledged
Treasury Securities, or (y) the substitution for the Pledged Treasury Securities
included in such Treasury Unit (if the Applicable Ownership Interest in the
Treasury Portfolio has replaced the Note as a component of Corporate Units), the
appropriate Applicable Ownership Interest in the Treasury Portfolio.
"COMPANY" means the Person named as the "COMPANY" in the first paragraph
of this instrument until a successor shall have become such pursuant to the
applicable provision of this Agreement, and thereafter "COMPANY" shall mean such
successor.
"CONSTITUENT PERSON" has the meaning set forth in Section 5.04(b).
"CONTRACT ADJUSTMENT PAYMENTS" means the payments payable by the Company
on the Payment Dates in respect of each Purchase Contract, at a rate per year of
______% of the Stated Amount per Purchase Contract.
"CORPORATE TRUST OFFICE" means the office of the Purchase Contract Agent
at which, at any particular time, its corporate trust business shall be
principally administered, which office at the date hereof is located at ______,
Fax: ______, Attn: ______.
"CORPORATE UNIT" means the collective rights and obligations of a Holder
of a Corporate Units Certificate in respect of the Notes or an appropriate
Applicable Ownership Interest in the Treasury Portfolio, as the case may be,
subject in each case (except for the appropriate Applicable Ownership Interest
specified in clause (ii) of the definition of such term) to the Pledge thereof,
and the related Purchase Contract.
"CORPORATE UNITS CERTIFICATE" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Corporate Units
specified on such certificate.
"COUPON RATE" means the percentage rate per annum at which each Note will
bear interest initially.
"CURRENT MARKET PRICE" has the meaning set forth in Section 5.04(a)(8).
"CUSTODIAL AGENT" means ______, a banking corporation with trust powers,
duly organized and existing under the laws of the State of ______, as Custodial
Agent under the Pledge Agreement until a successor Custodial Agent shall have
become such pursuant to the applicable provisions of the Pledge Agreement, and
thereafter "CUSTODIAL AGENT" shall mean the Person who is then the Custodial
Agent thereunder.
"DEFERRED CONTRACT ADJUSTMENT PAYMENTS" has the meaning provided in
Section 5.11.
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"DEPOSITARY" means a clearing agency registered under Section 17A of the
Exchange Act that is designated to act as Depositary for the Units as
contemplated by Sections 3.06 and 3.08.
"DEPOSITARY PARTICIPANT" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time the Depositary effects
book entry transfers and pledges of securities deposited with the Depositary.
"DTC" means The Depository Trust Company.
"EARLY SETTLEMENT" has the meaning set forth in Section 5.07.
"EARLY SETTLEMENT AMOUNT" has the meaning set forth in Section 5.07.
"EARLY SETTLEMENT DATE" has the meaning set forth in Section 5.07.
"EARLY SETTLEMENT RATE" has the meaning set forth in Section 5.07.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"EXCHANGE ACT" means the Securities Exchange Act of 1934 and any statute
successor thereto, in each case as amended from time to time, and the rules and
regulations promulgated thereunder.
"EXCHANGE PROPERTY" has the meaning set forth in Section 5.04(b).
"EXPIRATION DATE" has the meaning set forth in Section 1.04(e).
"EXPIRATION TIME" has the meaning set forth in Section 5.04(a)(6).
"EXTENSION PERIOD" has the meaning set forth in Section 5.11(a). "FAILED
FINAL REMARKETING" has the meaning set forth in Section 5.02(d).
"FAILED INITIAL REMARKETING" has the meaning set forth in Section
5.02(a).
"FAILED REMARKETING" shall mean any of (i) a Failed Initial Remarketing,
(ii) a Failed Second Remarketing, (iii) a Failed Third Remarketing or (iv) a
Failed Final Remarketing.
"FAILED SECOND REMARKETING" has the meaning set forth in Section 5.02(b).
"FAILED THIRD REMARKETING" has the meaning set forth in Section 5.02(b).
"FINAL REMARKETING" has the meaning set forth in Section 5.02(d).
"FINAL REMARKETING DATE" means the third Business Day immediately
preceding the Purchase Contract Settlement Date.
"FINAL REMARKETING FEE" has the meaning set forth in Section 5.02(d).
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"GLOBAL CERTIFICATE" means a Certificate that evidences all or part of
the Units and is registered in the name of the Depositary or a nominee thereof.
"HOLDER" means, with respect to a Unit, the Person in whose name the Unit
evidenced by a Certificate is registered in the Security Register; provided,
however, that solely for the purpose of determining whether the Holders of the
requisite number of Units have voted on any matter (and not for any other
purpose hereunder), if the Unit remains in the form of one or more Global
Certificates and if the Depositary that is the registered holder of such Global
Certificate has sent an omnibus proxy assigning voting rights to the Depositary
Participants to whose accounts the Units are credited on the record date, the
term "HOLDER" shall mean such Depositary Participant acting at the direction of
the Beneficial Owners.
"INDENTURE" means the Subordinated Indenture, dated as of April ______,
2003, between the Company and the Indenture Trustee (including any provisions of
the TIA that are deemed incorporated therein), as supplemented by Supplemental
Indenture No. 1 dated as of the date hereof, pursuant to which the Notes will be
issued.
"INDENTURE TRUSTEE" means ______, as trustee under the Indenture, or any
successor thereto.
"INITIAL REMARKETING" has the meaning set forth in Section 5.02(a).
"INITIAL REMARKETING DATE" means the third Business Day immediately
preceding ______.
"ISSUER ORDER" or "ISSUER REQUEST" means a written order or request
signed in the name of the Company by (i) either its Chief Executive Officer, its
President or one of its Vice Presidents, and (ii) either its Corporate Secretary
or one of its Assistant Corporate Secretaries or its Treasurer or one of its
Assistant Treasurers, and delivered to the Purchase Contract Agent.
"NON-ELECTING SHARE" has the meaning set forth in Section 5.04(b).
"NOTES" means the series of notes designated the ______% Notes due ______
to be issued by the Company under the Indenture.
"NYSE" has the meaning set forth in Section 5.01.
"OFFICERS' CERTIFICATE" means a certificate signed by (i) either the
Company's Chief Executive Officer, its President or one of its Vice Presidents,
and (ii) either the Company's Corporate Secretary or one of its Assistant
Corporate Secretaries or its Treasurer or one of its Assistant Treasurers, and
delivered to the Purchase Contract Agent. Any Officers' Certificate delivered
with respect to compliance with a condition or covenant provided for in this
Agreement (other than the Officers' Certificate provided for in Section 10.05)
shall include:
(i) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
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(ii) a brief statement of the nature and scope of the examination
or investigation undertaken by each officer in rendering the Officers'
Certificate;
(iii) a statement that, in the opinion of each such officer, each
such officer has made such examination or investigation as is necessary
to enable such officer to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"OPINION OF COUNSEL" means a written opinion of counsel, who may be
counsel to the Company (and who may be an employee of the Company), and who
shall be reasonably acceptable to the Purchase Contract Agent. An opinion of
counsel may rely on certificates as to matters of fact.
"ORDINARY SHARES" means the ordinary shares, par value $0.01 per share,
of the Company.
"OUTSTANDING UNITS" means, with respect to any Unit and as of the date of
determination, all Units evidenced by Certificates theretofore authenticated,
executed and delivered under this Agreement, except:
(i) if a Termination Event has occurred, (x) Corporate Units for
which the underlying Notes or Applicable Ownership Interests in the
Treasury Portfolio have been theretofore deposited with the Purchase
Contract Agent in trust for the Holders of such Corporate Units and (y)
Treasury Units;
(v) Units evidenced by Certificates theretofore cancelled by the
Purchase Contract Agent or delivered to the Purchase Contract Agent for
cancellation or deemed cancelled pursuant to the provisions of this
Agreement; and
(vi) Units evidenced by Certificates in exchange for or in lieu of
which other Certificates have been authenticated, executed on behalf of
the Holder and delivered pursuant to this Agreement, other than any such
Certificate in respect of which there shall have been presented to the
Purchase Contract Agent proof satisfactory to it that such Certificate is
held by a protected purchaser in whose hands the Units evidenced by such
Certificate are valid obligations of the Company;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
number of the Units have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Units owned by the Company or any Affiliate
of the Company shall be disregarded and deemed not to be Outstanding Units,
except that, in determining whether the Purchase Contract Agent shall be
authorized and protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Units that a
Responsible Officer of the Purchase Contract Agent actually knows to be so owned
shall be so disregarded. Units so owned that have been pledged in good faith may
be regarded as Outstanding Units if the pledgee establishes to the
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satisfaction of the Purchase Contract Agent the pledgee's right so to act with
respect to such Units and that the pledgee is not the Company or any Affiliate
of the Company.
"PAYMENT DATE" means each ______, ______, ______, and ______, of each
year, commencing ______.
"PERMITTED INVESTMENTS" has the meaning set forth in Section 1.01(d) of
the Pledge Agreement.
"PERSON" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint-stock company, limited
liability company, trust, unincorporated organization or government or any
agency or political subdivision thereof or any other entity of whatever nature.
"PLAN" means an employee benefit plan that is subject to ERISA, a plan or
individual retirement account that is subject to Section 4975 of the Code or any
entity whose assets are considered assets of any such plan.
"PLEDGE" means the pledge under the Pledge Agreement of the Notes, the
Treasury Securities or the appropriate Applicable Ownership Interest (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, in each case constituting a part of the Units (it
being understood that the appropriate Applicable Ownership Interest (as
specified in clause (ii) of the definition of such term) in the Treasury
Portfolio shall not be subject to the Pledge).
"PLEDGE AGREEMENT" means the Pledge Agreement, dated as of ______, among
the Company, the Collateral Agent, the Custodial Agent, the Securities
Intermediary and the Purchase Contract Agent, on its own behalf and as
attorney-in-fact for the Holders from time to time of the Units, as amended from
time to time.
"PLEDGED APPLICABLE OWNERSHIP INTERESTS" has the meaning set forth in
Section 1.01(d) of the Pledge Agreement.
"PLEDGED NOTES" has the meaning set forth in Section 1.01(d) of the
Pledge Agreement.
"PLEDGED TREASURY SECURITIES" has the meaning set forth in Section
1.01(d) of the Pledge Agreement.
"PREDECESSOR CERTIFICATE" means a Predecessor Corporate Units Certificate
or a Predecessor Treasury Units Certificate.
"PREDECESSOR CORPORATE UNITS CERTIFICATE" of any particular Corporate
Units Certificate means every previous Corporate Units Certificate evidencing
all or a portion of the rights and obligations of the Company and the Holder
under the Corporate Units evidenced thereby; and, for the purposes of this
definition, any Corporate Units Certificate authenticated and delivered under
Section 3.10 in exchange for or in lieu of a mutilated, destroyed, lost or
stolen Corporate Units Certificate shall be deemed to evidence the same rights
and obligations of
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the Company and the Holder as the mutilated, destroyed, lost or stolen Corporate
Units Certificate.
"PREDECESSOR TREASURY UNITS CERTIFICATE" of any particular Treasury Units
Certificate means every previous Treasury Units Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
Treasury Units evidenced thereby; and, for the purposes of this definition, any
Treasury Units Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Treasury Units
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Treasury
Units Certificate.
"PRIMARY TREASURY DEALER" shall mean a primary U.S. government securities
dealer.
"PROCEEDS" has the meaning set forth in Section 1.01(d) of the Pledge
Agreement.
"PRO RATA" shall mean pro rata to each Holder according to the aggregate
Stated Amount of the Units held by such Holder in relation to the aggregate
Stated Amount of all Units outstanding.
"PROSPECTUS" means the prospectus relating to the delivery of shares of
any securities in connection with an Early Settlement pursuant to Section 5.07
or a Cash Merger Early Settlement of Purchase Contracts pursuant to Section
5.04(b)(2), in the form in which first filed, or transmitted for filing, with
the Securities and Exchange Commission after the effective date of the
Registration Statement pursuant to Rule 424(b) under the Securities Act,
including the documents incorporated by reference therein as of the date of such
Prospectus.
"PURCHASE CONTRACT" means, with respect to any Unit, the contract forming
a part of such Unit and obligating the Company to (i) sell, and the Holder of
such Unit to purchase, shares of Ordinary Shares and (ii) pay the Holder thereof
Contract Adjustment Payments, in each case on the terms and subject to the
conditions set forth in Article Five hereof.
"PURCHASE CONTRACT AGENT" means the Person named as the "PURCHASE
CONTRACT AGENT" in the first paragraph of this Agreement until a successor
Purchase Contract Agent shall have become such pursuant to the applicable
provisions of this Agreement, and thereafter "PURCHASE CONTRACT AGENT" shall
mean such Person or any subsequent successor who is appointed pursuant to this
Agreement.
"PURCHASE CONTRACT SETTLEMENT DATE" means ______.
"PURCHASE CONTRACT SETTLEMENT FUND" has the meaning set forth in Section
5.03.
"PURCHASE PRICE" has the meaning set forth in Section 5.01.
"PURCHASED SHARES" has the meaning set forth in Section 5.04(a)(6).
"QUOTATION AGENT" means any Primary Treasury Dealer selected by the
Company.
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"RECORD DATE" for any distribution and Contract Adjustment Payment
payable on any Payment Date means, as to any Global Certificate or any other
Certificate, the first business day of the calendar month in which the relevant
Payment Date falls; provided that the Company may, at its option, select any
other day as the Record Date for any Payment Date so long as such Record Date
selected is more than one Business Day but fewer than 60 Business Days prior to
such Payment Date.
"REDEMPTION AMOUNT" has the meaning set forth in Section 1.02(e) of the
Supplemental Indenture No. 1.
"REDEMPTION PRICE" has the meaning set forth in Section 1.02(e) of the
Supplemental Indenture No. 1.
"REFERENCE DEALER" means a dealer engaged in trading of convertible
securities.
"REFERENCE PRICE" has the meaning set forth in Section 5.01.
"REGISTRATION STATEMENT" means a registration statement under the
Securities Act prepared by the Company covering, inter alia, the delivery by the
Company of any securities in connection with an Early Settlement on the Early
Settlement Date or a Cash Merger Early Settlement of Purchase Contracts on the
Cash Merger Early Settlement Date under Section 5.04(b)(2), including all
exhibits thereto and the documents incorporated by reference in the prospectus
contained in such registration statement, and any post-effective amendments
thereto.
"REMARKETING" means the remarketing of the Notes by the Remarketing Agent
pursuant to the Remarketing Agreement.
"REMARKETING AGENT" means ______, any successor remarketing agent
appointed by the Company pursuant to the Remarketing Agreement.
"REMARKETING AGREEMENT" means the Remarketing Agreement, dated as of
______, 200__, among the Company, the Remarketing Agent and the Purchase
Contract Agent, as amended from time to time.
"REMARKETING DATE" means any of (i) the Initial Remarketing Date, (ii)
the Second Remarketing Date, (iii) the Third Remarketing Date and (iv) the Final
Remarketing Date.
"REMARKETING FEE" has the meaning set forth in Section 5.02(a).
"REMARKETING PER NOTE PRICE" means the Treasury Portfolio Purchase Price
divided by the number of Notes held as components of Corporate Units and
remarketed in the Initial Remarketing, the Second Remarketing or the Third
Remarketing, as the case may be.
"REORGANIZATION EVENT" has the meaning set forth in Section 5.04(b).
"RESET RATE" has the meaning set forth in Section 1.02(e) of the
Supplemental Indenture No. 1.
10
"RESPONSIBLE OFFICER" means, with respect to the Purchase Contract Agent,
any officer within the corporate trust department of the Purchase Contract
Agent, including any vice president, assistant vice president, assistant
secretary, assistant treasurer, trust officer or any other officer of the
Purchase Contract Agent who customarily performs functions similar to those
performed by the Persons who at the time shall be such officers, respectively,
or to whom any corporate trust matter is referred because of such person's
knowledge of and familiarity with the particular subject and who shall have
direct responsibility for the administration of this
Purchase Contract
Agreement.
"RIGHTS" has the meaning set forth in Section 5.04(a)(11).
"RIGHTS AGREEMENT" has the meaning set forth in Section 5.04(a)(11).
"SECOND REMARKETING" has the meaning set forth in Section 5.02(b).
"SECOND REMARKETING DATE" means the third Business Day immediately
preceding ______, 200__.
"SECURITIES ACT" means the Securities Act of 1933 and any statute
successor thereto, in each case as amended from time to time, and the rules and
regulations promulgated thereunder.
"SECURITIES INTERMEDIARY" means ______, a banking corporation with trust
powers, duly organized and existing under the laws of the State of ______, as
Securities Intermediary under the Pledge Agreement until a successor Securities
Intermediary shall have become such pursuant to the applicable provisions of the
Pledge Agreement, and thereafter "SECURITIES INTERMEDIARY" shall mean such
successor or any subsequent successor who is appointed pursuant to the Pledge
Agreement.
"SECURITY REGISTER" and "SECURITIES REGISTRAR" have the respective
meanings set forth in Section 3.05.
"SENIOR INDEBTEDNESS" has the meaning set forth in Section ______ of the
Base Indenture.
"SEPARATE NOTES" means Notes that are no longer a component of Corporate
Units.
"SEPARATE NOTES PURCHASE PRICE" means the amount in cash equal to the
product of the Remarketing Per Note Price multiplied by the number of Separate
Notes remarketed in the Initial Remarketing, the Second Remarketing or the Third
Remarketing, as the case may be.
"SETTLEMENT RATE" has the meaning set forth in Section 5.01.
"SPECIAL EVENT" has the meaning set forth in Section ______ of the
Supplemental Indenture No. 1.
11
"SPECIAL EVENT REDEMPTION" means the redemption of the Notes pursuant to
the Indenture following the occurrence of a Special Event.
"SPECIAL EVENT REDEMPTION DATE" means the date upon which a Special Event
Redemption is scheduled to occur pursuant to the Indenture.
"STATED AMOUNT" means $______.
"SUCCESSFUL FINAL REMARKETING" has the meaning set forth in Section
5.02(d).
"SUCCESSFUL INITIAL REMARKETING" has the meaning set forth in Section
5.02(a).
"SUCCESSFUL REMARKETING" means any of (i) a Successful Initial
Remarketing, (ii) a Successful Second Remarketing, (iii) a Successful Third
Remarketing or (iv) a Successful Final Remarketing.
"SUCCESSFUL SECOND REMARKETING" has the meaning set forth in Section
5.02(b).
"SUCCESSFUL THIRD REMARKETING" has the meaning set forth in Section
5.02(b).
"SUPPLEMENTAL INDENTURE NO. 1" means the Supplemental Indenture No. 1
dated as of the date hereof between the Company and the Indenture Trustee.
"TAX EVENT" has the meaning set forth in Section ______ of the
Supplemental Indenture No. 1.
"TERMINATION DATE" means the date, if any, on which a Termination Event
occurs.
"TERMINATION EVENT" means the occurrence of any of the following events:
(i) at any time on or prior to the Purchase Contract Settlement
Date, a judgment, decree or court order shall have been entered granting
relief under the Bankruptcy Code, adjudicating the Company to be
insolvent, or approving as properly filed a petition seeking
reorganization or liquidation of the Company or any other similar
applicable Federal or state law and if such judgment, decree or order
shall have been entered more than 60 days prior to the Purchase Contract
Settlement Date, such decree or order shall have continued undischarged
and unstayed for a period of 60 days;
(vii) at any time on or prior to the Purchase Contract Settlement
Date, a judgment, decree or court order for the appointment of a receiver
or liquidator or trustee or assignee in bankruptcy or insolvency of the
Company or of its property, or for the termination or liquidation of its
affairs, shall have been entered and if such judgment, decree or order
shall have been entered more than 60 days prior to the Purchase Contract
Settlement Date, such judgment, decree or order shall have continued
undischarged and unstayed for a period of 60 days; or
12
(viii) at any time on or prior to the Purchase Contract Settlement
Date, the Company shall file a petition for relief under the Bankruptcy
Code, or shall consent to the filing of a bankruptcy proceeding against
it, or shall file a petition or answer or consent seeking reorganization
or liquidation under the Bankruptcy Code or any other similar applicable
Federal or State law, or shall consent to the filing of any such
petition, or shall consent to the appointment of a receiver or liquidator
or trustee or assignee in bankruptcy or insolvency of it or of its
property, or shall make an assignment for the benefit of creditors, or
shall admit in writing its inability to pay its debts generally as they
become due.
"THIRD REMARKETING" has the meaning set forth in Section 5.02(b).
"THIRD REMARKETING DATE" means the third Business Day immediately
preceding ______, 200__.
"THRESHOLD APPRECIATION PRICE" has the meaning set forth in Section 5.01.
"TIA" means the Trust Indenture Act of 1939, as amended from time to
time, or any successor legislation.
"TRADING DAY" has the meaning set forth in Section 5.01.
"TREASURY PORTFOLIO" means a portfolio of (i) U.S. treasury securities
(or principal or interest strips thereof) that mature on or prior to ______,
200__ in an aggregate amount at maturity equal to the Applicable Principal
Amount, and (ii) (x) in the case of a Successful Remarketing prior to the Final
Remarketing Date, for the scheduled Payment Date on the Notes that occurs on the
Purchase Contract Settlement Date, U.S. treasury securities (or principal or
interest strips thereof) that mature on or prior to ______, 200__ in an
aggregate amount at maturity equal to the aggregate interest payment (assuming
no reset of the interest rate) that would have been due on the Purchase Contract
Settlement Date on the Applicable Principal Amount, and (y) in the case of a
Special Event Redemption, for each scheduled Payment Date that occurs after the
Special Event Redemption Date to and including the Purchase Contract Settlement
Date, U.S. treasury securities (or principal or interest strips thereof) that
mature on or prior to the business day immediately preceding such scheduled
Payment Date in an aggregate amount at maturity equal to the aggregate interest
payment (assuming no reset of the interest rate) that would have been due on
such scheduled Payment Date on the Applicable Principal Amount.
"TREASURY PORTFOLIO PURCHASE PRICE" means the lowest aggregate ask-side
price quoted by a Primary Treasury Dealer to the Quotation Agent between 9:00
a.m. and 11:00 a.m. (
New York City time) (i) in the case of a Special Event
Redemption, on the third Business Day immediately preceding the Special Event
Redemption Date for the purchase of the applicable Treasury Portfolio for
settlement on the Special Event Redemption Date, and (ii) in the case of any
Successful Remarketing prior to the Final Remarketing Date, on the date of such
Successful Remarketing for the purchase of the applicable Treasury Portfolio for
settlement on the third Business Day immediately following the date of such
Successful Remarketing.
13
"TREASURY SECURITIES" means zero-coupon U.S. treasury securities that
mature on ______, 200__ (CUSIP No. __________).
"TREASURY UNIT" means, following the substitution of Treasury Securities
for Pledged Notes or the Pledged Applicable Ownership Interest in the Treasury
Portfolio as collateral to secure a Holder's obligations under the Purchase
Contract, the collective rights and obligations of a Holder of a Treasury Units
Certificate in respect of such Treasury Securities, subject to the Pledge
thereof, and the related Purchase Contract.
"TREASURY UNITS CERTIFICATE" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Treasury Unit specified
on such certificate.
"UNDERWRITERS" means the underwriters identified in Schedule ______ to
the Underwriting Agreement.
"UNDERWRITING AGREEMENT" means the Underwriting Agreement, dated ______,
200__, among the Company and the Underwriters, including the Pricing Agreement
referred to therein.
"UNIT" means a Corporate Unit or a Treasury Unit, as the case may be.
"VICE PRESIDENT" means any vice president, whether or not designated by a
number or a word or words added before or after the title "vice president."
SECTION 1.02. Compliance Certificates and Opinions.
Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Purchase Contract Agent to take any
action in accordance with any provision of this Agreement, the Company shall
furnish to the Purchase Contract Agent an Officers' Certificate stating that all
conditions precedent, if any, provided for in this Agreement relating to the
proposed action have been complied with and, if requested by the Purchase
Contract Agent, an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Agreement
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Agreement (other than the Officers' Certificate
provided for in Section 10.05) shall include:
(i) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
14
(iii) a statement that, in the opinion of each such individual, he
or she has made such examination or investigation as is necessary to
enable such individual to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 1.03. Form of Documents Delivered to Purchase Contract Agent.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents. Any
certificate or opinion of an officer of the Company may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations
by, counsel, unless such officer knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
the matters upon which its certificate or opinion is based are erroneous. Any
such certificate or Opinion of Counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, an
officer or officers of the Company unless such counsel knows, or in the exercise
of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
SECTION 1.04. Acts of Holders; Record Dates.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Purchase Contract Agent and, where it is hereby expressly required, to
the Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of the Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Agreement and (subject to Section 7.01) conclusive in favor of
the Purchase Contract Agent and the Company, if made in the manner provided in
this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner which the Purchase Contract
Agent deems sufficient.
(c) The ownership of Units shall be proved by the Security Register.
15
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Unit shall bind every future Holder of
the same Unit and the Holder of every Certificate evidencing such Unit issued
upon the registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered to be done by the
Purchase Contract Agent or the Company in reliance thereon, whether or not
notation of such action is made upon such Certificate.
(e) The Company may set any date as a record date for the purpose of
determining the Holders of Outstanding Units entitled to give, make or take any
request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Agreement to be given, made or taken by
Holders of Units. If any record date is set pursuant to this paragraph, the
Holders of the Outstanding Corporate Units and the Outstanding Treasury Units,
as the case may be, on such record date, and no other Holders, shall be entitled
to take the relevant action with respect to the Corporate Units or the Treasury
Units, as the case may be, whether or not such Holders remain Holders after such
record date; provided that no such action shall be effective hereunder unless
taken prior to or on the applicable Expiration Date by Holders of the requisite
number of Outstanding Units on such record date. Nothing contained in this
paragraph shall be construed to prevent the Company from setting a new record
date for any action for which a record date has previously been set pursuant to
this paragraph (whereupon the record date previously set shall automatically and
with no action by any Person be cancelled and be of no effect), and nothing
contained in this paragraph shall be construed to render ineffective any action
taken by Holders of the requisite number of Outstanding Units on the date such
action is taken. Promptly after any record date is set pursuant to this
paragraph, the Company, at its own expense, shall cause notice of such record
date, the proposed action by Holders and the applicable Expiration Date to be
given to the Purchase Contract Agent in writing and to each Holder of Units in
the manner set forth in Section 1.06.
With respect to any record date set pursuant to this Section 1.04(e), the
Company may designate any date as the "Expiration Date" and from time to time
may change the Expiration Date to any earlier or later day; provided that no
such change shall be effective unless notice of the proposed new Expiration Date
is given to the Purchase Contract Agent in writing, and to each Holder of Units
in the manner set forth in Section 1.06, prior to or on the existing Expiration
Date. If an Expiration Date is not designated with respect to any record date
set pursuant to this Section, the Company shall be deemed to have initially
designated the 180th day after such record date as the Expiration Date with
respect thereto, subject to its right to change the Expiration Date as provided
in this paragraph. Notwithstanding the foregoing, no Expiration Date shall be
later than the 180th day after the applicable record date.
SECTION 1.05. Notices.
Any notice or communication is duly given if in writing and delivered in
Person or mailed by first-class mail (registered or certified, return receipt
requested), telecopier (with receipt confirmed) or overnight air courier
guaranteeing next day delivery, to the others' address; provided that notice
shall be deemed given to the Purchase Contract Agent only upon receipt thereof:
16
If to the Purchase Contract Agent:
------
If to the Company:
Scottish Annuity & Life Holdings, Ltd.
▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
4 Par-la-Ville Road
▇▇▇▇▇▇▇▇ HMMX, Bermuda
Attention: General Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Collateral Agent:
------
If to the Indenture Trustee:
------
The Purchase Contract Agent shall send to the Indenture Trustee at the
telecopier number set forth above a copy of any notices in the form of Exhibits
C, D, E or F it sends or receives.
SECTION 1.06. Notice to Holders; Waiver.
Where this Agreement provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at its address as it appears in the Security Register, not later
than the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed
to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Agreement provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Purchase Contract Agent, but such filing shall not be a condition precedent to
the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason
of any other cause it shall be impracticable to give such notice by mail, then
such notification as shall be made with the approval of the Purchase Contract
Agent shall constitute a sufficient notification for every purpose hereunder.
17
SECTION 1.07. Effect of Headings and Table of Contents.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 1.08. Successors and Assigns.
All covenants and agreements in this Agreement by the Company and the
Purchase Contract Agent shall bind their respective successors and assigns,
whether so expressed or not.
SECTION 1.09. Separability Clause.
In case any provision in this Agreement or in the Units shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions hereof and thereof shall not in any way be affected or
impaired thereby.
SECTION 1.10. Benefits of Agreement.
Nothing contained in this Agreement or in the Units, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and, to the extent provided hereby, the Holders, any benefits or any
legal or equitable right, remedy or claim under this Agreement. The Holders from
time to time shall be beneficiaries of this Agreement and shall be bound by all
of the terms and conditions hereof and of the Units evidenced by their
Certificates by their acceptance of delivery of such Certificates.
SECTION 1.11. Governing Law.
This Agreement and the Units shall be governed by, and construed in
accordance with, the laws of the State of
New York, without giving effect to the
conflicts of law provisions thereof.
SECTION 1.12. Legal Holidays.
In any case where any Payment Date shall not be a Business Day
(notwithstanding any other provision of this Agreement or the Units), Contract
Adjustment Payments or other distributions shall not be paid on such date, but
Contract Adjustment Payments or such other distributions shall be paid on the
next succeeding Business Day, unless such Business Day is in the next succeeding
calendar year, in which case such Contract Adjustment Payments or other
distributions shall be paid on the immediately preceding Business Day, in each
case with the same force and effect as if made on such scheduled Payment Date;
provided that no interest shall accrue or be payable by the Company to any
Holder in respect of such payment or distribution for the period from and after
any such scheduled Payment Date.
In any case where the Purchase Contract Settlement Date or any Early
Settlement Date or Cash Merger Early Settlement Date shall not be a Business Day
(notwithstanding any other provision of this Agreement or the Units), Purchase
Contracts shall not be performed and Early Settlement and Cash Merger Early
Settlement shall not be effected on such date, but Purchase Contracts shall be
performed or Early Settlement or Cash Merger Early Settlement shall be
18
effected, as applicable, on the next succeeding Business Day with the same force
and effect as if made on such Purchase Contract Settlement Date, Early
Settlement Date or Cash Merger Early Settlement Date, as applicable.
SECTION 1.13. Counterparts.
This Agreement may be executed in any number of counterparts by the
parties hereto on separate counterparts, each of which, when so executed and
delivered, shall be deemed an original, but all such counterparts shall together
constitute one and the same instrument.
SECTION 1.14. Inspection of Agreement.
A copy of this Agreement shall be available at all reasonable times
during normal business hours at the Corporate Trust Office for inspection by any
Holder or Beneficial Owner.
SECTION 1.15. Appointment of Financial Institution as Agent for the
Company.
The Company may appoint a financial institution (which may be the
Collateral Agent) to act as its agent in performing its obligations and in
accepting and enforcing performance of the obligations of the Purchase Contract
Agent and the Holders, under this Agreement and the Purchase Contracts, by
giving notice of such appointment in the manner provided in Section 1.05 hereof.
Any such appointment shall not relieve the Company in any way from its
obligations hereunder.
SECTION 1.16. No Waiver.
No failure on the part of the Company, the Purchase Contract Agent, the
Collateral Agent, the Securities Intermediary or any of their respective 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 the Company, the Collateral
Agent, the Securities Intermediary or any of their respective 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.
ARTICLE II
CERTIFICATE FORMS
SECTION 2.01. Forms of Certificates Generally.
The Certificates (including the form of Purchase Contract forming part of
each Unit evidenced thereby) shall be in substantially the form set forth in
Exhibit A hereto (in the case of Certificates evidencing Corporate Units) or
Exhibit B hereto (in the case of Certificates evidencing Treasury Units), with
such letters, numbers or other marks of identification or designation and such
legends or endorsements printed, lithographed or engraved thereon as may be
required by the rules of any securities exchange on which the Units are listed
or any
19
depositary therefor, or as may, consistently herewith, be determined by the
officers of the Company executing such Certificates, as evidenced by their
execution of the Certificates.
The definitive Certificates shall be produced in any manner as determined
by the officers of the Company executing the Units evidenced by such
Certificates, consistent with the provisions of this Agreement, as evidenced by
their execution thereof.
Every Global Certificate authenticated, executed on behalf of the Holders
and delivered hereunder shall bear a legend in substantially the following form:
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN
THE NAME OF CEDE & CO., AS NOMINEE OF THE DEPOSITORY TRUST COMPANY, A
NEW
YORK CORPORATION (THE "DEPOSITARY"), THE DEPOSITARY OR ANOTHER NOMINEE OF
THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR CERTIFICATES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
PURCHASE
CONTRACT AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A
TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF
THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED
CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REQUESTED IN THE NAME OF CEDE & CO. OR SUCH OTHER
NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND
ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
SECTION 2.02. Form of Purchase Contract Agent's Certificate of
Authentication.
The form of the Purchase Contract Agent's certificate of authentication
of the Units shall be in substantially the form set forth on the form of the
applicable Certificates.
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ARTICLE III
THE UNITS
SECTION 3.01. Amount; Form and Denominations.
The aggregate number of Units evidenced by Certificates authenticated,
executed on behalf of the Holders and delivered hereunder is limited to ______
(or ______ if the over-allotment option granted to the Underwriters pursuant to
the Underwriting Agreement is exercised in full), except for Certificates
authenticated, executed and delivered upon registration of transfer of, in
exchange for, or in lieu of, other Certificates pursuant to Sections 3.04, 3.05,
3.09, 3.10, 3.13, 3.14 or 8.05.
The Certificates shall be issuable only in registered form and only in
denominations of a single Corporate Unit or Treasury Unit and any integral
multiple thereof.
SECTION 3.02. Rights and Obligations Evidenced by the Certificates.
Each Corporate Units Certificate shall evidence the number of Corporate
Units specified therein, with each such Corporate Unit representing (1) the
ownership by the Holder thereof of a beneficial interest in a Note or the
Applicable Ownership Interest in the Treasury Portfolio, as the case may be,
subject to the Pledge of such Note or the Applicable Ownership Interest (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, by such Holder pursuant to the Pledge Agreement,
and (2) the rights and obligations of the Holder thereof and the Company under
one Purchase Contract. The Purchase Contract Agent is hereby authorized, as
attorney-in-fact for, and on behalf of, the Holder of each Corporate Unit, to
pledge, pursuant to the Pledge Agreement, the Note and the Applicable Ownership
Interest (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio, if any, forming a part of such Corporate Unit, to the
Collateral Agent for the benefit of the Company, and to grant to the Collateral
Agent, for the benefit of the Company, a security interest in the right, title
and interest of such Holder in such Note and the Applicable Ownership Interest
(as specified in clause (i) of the definition of such term) in the Treasury
Portfolio, if any, to secure the obligation of the Holder under each Purchase
Contract to purchase shares of Ordinary Shares.
Upon the formation of a Treasury Unit pursuant to Section 3.13, each
Treasury Unit Certificate shall evidence the number of Treasury Units specified
therein, with each such Treasury Unit representing (1) the ownership by the
Holder thereof of a ______ undivided beneficial interest in a Treasury Security
with a principal amount equal to $______, subject to the Pledge of such interest
by such Holder pursuant to the Pledge Agreement, and (2) the rights and
obligations of the Holder thereof and the Company under one Purchase Contract.
The Purchase Contract Agent is hereby authorized, as attorney-in-fact for, and
on behalf of, the Holder of each Treasury Unit, to pledge, pursuant to the
Pledge Agreement, such Holder's interest in the Treasury Security forming a part
of such Treasury Unit to the Collateral Agent, for the benefit of the Company,
and to grant to the Collateral Agent, for the benefit of the Company, a security
interest in the right, title and interest of such Holder in such Treasury
Security to secure the obligation of the Holder under each Purchase Contract to
purchase shares of Ordinary Shares.
21
Prior to the purchase of shares of Ordinary Shares under each Purchase
Contract, such Purchase Contracts shall not entitle the Holder of a Unit to any
of the rights of a holder of shares of Ordinary Shares, including, without
limitation, the right to vote or receive any dividends or other payments or to
consent or to receive notice as a shareholder in respect of the meetings of
shareholders or for the election of directors of the Company or for any other
matter, or any other rights whatsoever as a shareholder of the Company.
SECTION 3.03. Execution, Authentication, Delivery and Dating.
Subject to the provisions of Sections 3.13 and 3.14 hereof, upon the
execution and delivery of this Agreement, and at any time and from time to time
thereafter, the Company may deliver Certificates executed by the Company to the
Purchase Contract Agent for authentication, execution on behalf of the Holders
and delivery, together with its Issuer Order for authentication of such
Certificates, and the Purchase Contract Agent in accordance with such Issuer
Order shall authenticate, execute on behalf of the Holders and deliver such
Certificates.
The Certificates shall be executed on behalf of the Company by its
Chairman of the Board, its Chief Executive Officer, its President, its Treasurer
or one of its Vice Presidents. The signature of any of these officers on the
Certificates may be manual or facsimile.
Certificates bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates.
No Purchase Contract evidenced by a Certificate shall be valid until such
Certificate has been executed on behalf of the Holder by the manual signature of
an authorized officer of the Purchase Contract Agent, as such Holder's
attorney-in-fact. Such signature by an authorized officer of the Purchase
Contract Agent shall be conclusive evidence that the Holder of such Certificate
has entered into the Purchase Contracts evidenced by such Certificate.
Each Certificate shall be dated the date of its authentication.
No Certificate shall be entitled to any benefit under this Agreement or
be valid or obligatory for any purpose unless there appears on such Certificate
a certificate of authentication substantially in the form provided for herein
executed by an authorized officer of the Purchase Contract Agent by manual
signature, and such certificate upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder.
SECTION 3.04. Temporary Certificates.
Pending the preparation of definitive Certificates, the Company shall
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall authenticate, execute on behalf of the Holders, and deliver, in lieu
of such definitive Certificates, temporary Certificates which are in
substantially the form set forth in Exhibit A or Exhibit B hereto, as the case
may be, with such letters, numbers or other marks of identification or
designation and such legends or endorsements printed, lithographed or engraved
thereon as may be required by the rules of any
22
securities exchange on which the Corporate Units or Treasury Units, as the case
may be, are listed, or as may, consistently herewith, be determined by the
officers of the Company executing such Certificates, as evidenced by their
execution of the Certificates.
If temporary Certificates are issued, the Company will cause definitive
Certificates to be prepared without unreasonable delay. After the preparation of
definitive Certificates, the temporary Certificates shall be exchangeable for
definitive Certificates upon surrender of the temporary Certificates at the
Corporate Trust Office, at the expense of the Company and without charge to the
Holder. Upon surrender for cancellation of any one or more temporary
Certificates, the Company shall execute and deliver to the Purchase Contract
Agent, and the Purchase Contract Agent shall authenticate, execute on behalf of
the Holder, and deliver in exchange therefor, one or more definitive
Certificates of like tenor and denominations and evidencing a like number of
Units as the temporary Certificate or Certificates so surrendered. Until so
exchanged, the temporary Certificates shall in all respects evidence the same
benefits and the same obligations with respect to the Units evidenced thereby as
definitive Certificates.
SECTION 3.05. Registration; Registration of Transfer and Exchange.
The Purchase Contract Agent shall keep at the Corporate Trust Office a
register (the "Security Register") in which, subject to such reasonable
regulations as it may prescribe, the Purchase Contract Agent shall provide for
the registration of Certificates and of transfers of Certificates (the Purchase
Contract Agent, in such capacity, the "Security Registrar"). The Security
Registrar shall record separately the registration and transfer of the
Certificates evidencing Corporate Units and Treasury Units.
Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office, the Company shall execute and deliver to the Purchase
Contract Agent, and the Purchase Contract Agent shall authenticate, execute on
behalf of the designated transferee or transferees, and deliver, in the name of
the designated transferee or transferees, one or more new Certificates of any
authorized denominations, like tenor, and evidencing a like number of Corporate
Units or Treasury Units, as the case may be.
At the option of the Holder, Certificates may be exchanged for other
Certificates, of any authorized denominations and evidencing a like number of
Corporate Units or Treasury Units, as the case may be, upon surrender of the
Certificates to be exchanged at the Corporate Trust Office. Whenever any
Certificates are so surrendered for exchange, the Company shall execute and
deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall
authenticate, execute on behalf of the Holder, and deliver the Certificates
which the Holder making the exchange is entitled to receive.
All Certificates issued upon any registration of transfer or exchange of
a Certificate shall evidence the ownership of the same number of Corporate Units
or Treasury Units, as the case may be, and be entitled to the same benefits and
subject to the same obligations under this Agreement as the Corporate Units or
Treasury Units, as the case may be, evidenced by the Certificate surrendered
upon such registration of transfer or exchange.
23
Every Certificate presented or surrendered for registration of transfer
or exchange shall (if so required by the Purchase Contract Agent) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Purchase Contract Agent duly executed, by
the Holder thereof or its attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of a Certificate, but the Company and the Purchase Contract Agent may
require payment from the Holder of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any registration of
transfer or exchange of Certificates, other than any exchanges pursuant to
Sections 3.04, 3.06 and 8.05 not involving any transfer.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall not be obligated to authenticate, execute on behalf of the Holder
and deliver any Certificate in exchange for any other Certificate presented or
surrendered for registration of transfer or for exchange on or after the
Business Day immediately preceding the earliest to occur of any Early Settlement
Date with respect to such Certificate, any Cash Merger Early Settlement Date
with respect to such Certificate, the Purchase Contract Settlement Date or the
Termination Date. In lieu of delivery of a new Certificate, upon satisfaction of
the applicable conditions specified above in this Section and receipt of
appropriate registration or transfer instructions from such Holder, the Purchase
Contract Agent shall:
(i) if the Purchase Contract Settlement Date (including upon any
Cash Settlement) or an Early Settlement Date or a Cash Merger Early
Settlement Date with respect to such other Certificate has occurred,
deliver the shares of Ordinary Shares issuable in respect of the Purchase
Contracts forming a part of the Units evidenced by such other
Certificate; or
(ii) if a Termination Event shall have occurred prior to the
Purchase Contract Settlement Date, transfer the Notes, the Treasury
Securities, or the appropriate Applicable Ownership Interest in the
Treasury Portfolio, as the case may be, evidenced thereby, in each case
subject to the applicable conditions and in accordance with the
applicable provisions of Section 3.15 and Article Five hereof.
The Purchase Contract Agent shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer imposed
under this Agreement or under applicable law with respect to any transfer of any
interest in any Certificates (including any transfers between or among
Depositary Participants or beneficial owners of interests in any Certificate in
global form) other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if and when
expressly required by, and to do so if and when expressly required by the terms
of, this Agreement, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
The Purchase Contract Agent shall have no responsibility for any actions
taken or not taken by the Depositary.
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SECTION 3.06. Book-Entry Interests.
The Certificates, on original issuance, will be issued in the form of one
or more fully registered Global Certificates, to be delivered to the Depositary
or its custodian by, or on behalf of, the Company. The Company hereby designates
DTC as the initial Depositary. Such Global Certificates shall initially be
registered on the books and records of the Company in the name of Cede & Co.,
the nominee of the Depositary, and no Beneficial Owner will receive a definitive
Certificate representing such Beneficial Owner's interest in such Global
Certificate, except as provided in Section 3.09. The Purchase Contract Agent
shall enter into an agreement with the Depositary if so requested by the
Company. Unless and until definitive, fully registered Certificates have been
issued to Beneficial Owners pursuant to Section 3.09:
(i) the provisions of this Section 3.06 shall be in full force and
effect;
(ii) the Company shall be entitled to deal with the Depositary for
all purposes of this Agreement (including, without limitation, making
Contract Adjustment Payments and receiving approvals, votes or consents
hereunder) as the Holder of the Units and the sole holder of the Global
Certificates and shall have no obligation to the Beneficial Owners;
(iii) to the extent that the provisions of this Section 3.06
conflict with any other provisions of this Agreement, the provisions of
this Section 3.06 shall control; and
(iv) the rights of the Beneficial Owners shall be exercised only
through the Depositary and shall be limited to those established by law
and agreements between such Beneficial Owners and the Depositary or the
Depositary Participants.
Transfers of securities evidenced by Global Certificates shall be made through
the facilities of the Depositary, and any cancellation of, or increase or
decrease in the number of, such securities (including the creation of Treasury
Units and the recreation of Corporate Units pursuant to Sections 3.13 and 3.14
respectively) shall be accomplished by making appropriate annotations on the
Schedule of Increases and Decreases for such Global Certificate.
SECTION 3.07. Notices to Holders.
Whenever a notice or other communication to the Holders is required to be
given under this Agreement, the Company or the Company's agent shall give such
notices and communications to the Holders and, with respect to any Units
registered in the name of the Depositary or the nominee of the Depositary, the
Company or the Company's agent shall, except as set forth herein, have no
obligations to the Beneficial Owners.
SECTION 3.08. Appointment of Successor Depositary.
If the Depositary elects to discontinue its services as securities
depositary with respect to the Units, the Company may, in its sole discretion,
appoint a successor Depositary with respect to the Units.
25
SECTION 3.09. Definitive Certificates.
If:
(i) the Depositary notifies the Company that it is unwilling or
unable to continue its services as securities depositary with respect to
the Units and no successor Depositary has been appointed pursuant to
Section 3.08 within 90 days after such notice; or
(ii) the Depositary ceases to be a "clearing agency" registered
under Section 17A of the Exchange Act when the Depositary is required to
be so registered to act as the Depositary and so notifies the Company,
and no successor Depositary has been appointed pursuant to Section 3.08
within 90 days after such notice; or
(iii) the Company determines in its discretion that the Global
Certificates shall be exchangeable for definitive Certificates,
then (x) definitive Certificates shall be prepared by the Company with respect
to such Units and delivered to the Purchase Contract Agent and (y) upon
surrender of the Global Certificates representing the Units by the Depositary,
accompanied by registration instructions, the Company shall cause definitive
Certificates to be delivered to Beneficial Owners in accordance with the
instructions of the Depositary. The Company and the Purchase Contract Agent
shall not be liable for any delay in delivery of such instructions and may
conclusively rely on and shall be authorized and protected in relying on, such
instructions. Each definitive Certificate so delivered shall evidence Units of
the same kind and tenor as the Global Certificate so surrendered in respect
thereof.
SECTION 3.10. Mutilated, Destroyed, Lost and Stolen Certificates.
If any mutilated Certificate is surrendered to the Purchase Contract
Agent, the Company shall execute and deliver to the Purchase Contract Agent, and
the Purchase Contract Agent shall authenticate, execute on behalf of the Holder,
and deliver in exchange therefor, a new Certificate, evidencing the same number
of Corporate Units or Treasury Units, as the case may be, and bearing a
Certificate number not contemporaneously outstanding.
If there shall be delivered to the Company and the Purchase Contract
Agent (i) evidence to their satisfaction of the destruction, loss or theft of
any Certificate, and (ii) such security or indemnity as may be required by them
to hold each of them and any agent of any of them harmless, then, in the absence
of notice to the Company or the Purchase Contract Agent that such Certificate
has been acquired by a protected purchaser, the Company shall execute and
deliver to the Purchase Contract Agent, and the Purchase Contract Agent shall
authenticate, execute on behalf of the Holder, and deliver to the Holder, in
lieu of any such destroyed, lost or stolen Certificate, a new Certificate,
evidencing the same number of Corporate Units or Treasury Units, as the case may
be, and bearing a Certificate number not contemporaneously outstanding.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Purchase Contract Agent, and the Purchase Contract
Agent shall not be obligated to authenticate, execute on behalf of the Holder,
and deliver to the Holder, a Certificate on or
26
after the Business Day immediately preceding the earliest of any Early
Settlement Date with respect to such lost or mutilated Certificate, any Cash
Merger Early Settlement Date with respect to such lost or mutilated Certificate,
the Purchase Contract Settlement Date or the Termination Date. In lieu of
delivery of a new Certificate, upon satisfaction of the applicable conditions
specified above in this Section and receipt of appropriate registration or
transfer instructions from such Holder, the Purchase Contract Agent shall:
(i) if the Purchase Contract Settlement Date or Early Settlement
Date or Cash Merger Early Settlement Date with respect to such lost,
stolen, destroyed or mutilated Certificate has occurred, deliver the
shares of Ordinary Shares issuable in respect of the Purchase Contracts
forming a part of the Units evidenced by such Certificate; or
(ii) if a Cash Settlement with respect to such lost or mutilated
Certificate or if a Termination Event shall have occurred prior to the
Purchase Contract Settlement Date, transfer the Notes, the Treasury
Securities or the appropriate Applicable Ownership Interest (as specified
in clause (i) of the definition of such term) in the Treasury Portfolio,
as the case may be, evidenced thereby, in each case subject to the
applicable conditions and in accordance with the applicable provisions of
Section 3.15 and Article Five hereof.
Upon the issuance of any new Certificate under this Section, the Company
and the Purchase Contract Agent may require the payment by the Holder of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other fees and expenses (including, without limitation,
the fees and expenses of the Purchase Contract Agent) connected therewith.
Every new Certificate issued pursuant to this Section in lieu of any
destroyed, lost or stolen Certificate shall constitute an original additional
contractual obligation of the Company and of the Holder in respect of the Units
evidenced thereby, whether or not the destroyed, lost or stolen Certificate (and
the Units evidenced thereby) shall be at any time enforceable by anyone, and
shall be entitled to all the benefits and be subject to all the obligations of
this Agreement equally and proportionately with any and all other Certificates
delivered hereunder.
The provisions of this Section are exclusive and shall preclude, to the
extent lawful, all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Certificates.
SECTION 3.11. Persons Deemed Owners.
Prior to due presentment of a Certificate for registration of transfer,
the Company and the Purchase Contract Agent, and any agent of the Company or the
Purchase Contract Agent, may treat the Person in whose name such Certificate is
registered as the owner of the Units evidenced thereby for purposes of (subject
to any applicable record date) any payment or distribution on the Notes or on
the Applicable Ownership Interests (as specified in clause (ii) of the
definition of such term) in the Treasury Portfolio (if any), as applicable,
payment of Contract Adjustment Payments and performance of the Purchase
Contracts and for all other purposes whatsoever in connection with such Units,
whether or not such payment, distribution, or performance shall be overdue and
notwithstanding any notice to the contrary, and neither the Company nor the
27
Purchase Contract Agent, nor any agent of the Company or the Purchase Contract
Agent, shall be affected by notice to the contrary.
Notwithstanding the foregoing, with respect to any Global Certificate,
nothing contained herein shall prevent the Company, the Purchase Contract Agent
or any agent of the Company or the Purchase Contract Agent, from giving effect
to any written certification, proxy or other authorization furnished by the
Depositary (or its nominee), as a Holder, with respect to such Global
Certificate, or impair, as between such Depositary and the related Beneficial
Owner, the operation of customary practices governing the exercise of rights of
the Depositary (or its nominee) as Holder of such Global Certificate. None of
the Company, the Purchase Contract Agent or any agent of the Company or the
Purchase Contract Agent will have any responsibility or liability for any aspect
of the records relating to or payments made on account of beneficial ownership
interests of a Global Certificate or maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.
SECTION 3.12. Cancellation.
All Certificates surrendered for delivery of shares of Ordinary Shares on
or after the Purchase Contract Settlement Date or upon the transfer of Notes, or
for delivery of the appropriate Applicable Ownership Interest in the Treasury
Portfolio or Treasury Securities, as the case may be, after the occurrence of a
Termination Event or pursuant to a Cash Settlement, an Early Settlement or a
Cash Merger Early Settlement, or upon the registration of transfer or exchange
of a Unit, or a Collateral Substitution or the recreation of Corporate Units
shall, if surrendered to any Person other than the Purchase Contract Agent, be
delivered to the Purchase Contract Agent along with appropriate written
instructions regarding the cancellation thereof and, if not already cancelled,
shall be promptly cancelled by it. The Company may at any time deliver to the
Purchase Contract Agent for cancellation any Certificates previously
authenticated, executed and delivered hereunder which the Company may have
acquired in any manner whatsoever, and all Certificates so delivered shall, upon
an Issuer Order, be promptly cancelled by the Purchase Contract Agent. No
Certificates shall be authenticated, executed on behalf of the Holder and
delivered in lieu of or in exchange for any Certificates cancelled as provided
in this Section, except as expressly permitted by this Agreement. All cancelled
Certificates held by the Purchase Contract Agent shall be disposed of in
accordance with its customary practices.
If the Company or any Affiliate of the Company shall acquire any
Certificate, such acquisition shall not operate as a cancellation of such
Certificate unless and until such Certificate is delivered to the Purchase
Contract Agent cancelled or with appropriate written instructions regarding the
cancellation thereof.
SECTION 3.13. Creation of Treasury Units by Substitution of Treasury
Securities.
Unless the Treasury Portfolio has replaced the Notes as a component of
the Corporate Units, and subject to the conditions set forth in this Agreement,
a Holder may, at any time from and after the date of this Agreement and prior to
5:00 p.m. (
New York City time) on the fifth Business Day immediately preceding
the Purchase Contract Settlement Date, effect a Collateral Substitution and
separate the Notes from the related Purchase Contracts in respect of such
Holder's Corporate Units by substituting for such Notes, Treasury Securities in
an aggregate principal amount at maturity equal to the aggregate
28
principal amount of such Notes; PROVIDED THAT Holders may make Collateral
Substitutions only in integral multiples of ______ Corporate Units. To effect
such substitution, the Holder must:
(1) deposit with the Securities Intermediary Treasury
Securities having an aggregate principal amount at maturity
equal to the aggregate principal amount of the Notes
comprising part of such Corporate Units; and
(2) transfer the related Corporate Units to the Purchase
Contract Agent accompanied by a notice to the Purchase
Contract Agent, substantially in the form of Exhibit C
hereto, (i) stating that the Holder has deposited the
relevant amount of Treasury Securities to the Securities
Intermediary and (ii) requesting that the Purchase Contract
Agent instruct the Collateral Agent to release the Notes
underlying such Corporate Units, whereupon the Purchase
Contract Agent shall promptly provide an instruction to
such effect to the Collateral Agent, substantially in the
form of Exhibit A to the Pledge Agreement.
Upon receipt of the Treasury Securities described in clause (1) above and
the instruction described in clause (2) above, in accordance with the terms of
the Pledge Agreement, the Collateral Agent will cause the Securities
Intermediary to effect the release of such Notes from the Pledge, free and clear
of the Company's security interest therein, and the transfer of such Notes to
the Purchase Contract Agent on behalf of the Holder. Upon receipt of such Notes,
the Purchase Contract Agent shall promptly:
(i) cancel the related Corporate Units;
(ii) transfer the Notes to the Holder (such Notes shall be
tradeable as a separate security, independent of the resulting Treasury
Units); and
(iii) authenticate, execute on behalf of such Holder and deliver a
Treasury Units Certificate executed by the Company in accordance with
Section 3.03 evidencing the same number of Purchase Contracts as were
evidenced by the cancelled Corporate Units.
Holders who elect to separate the Notes from the related Purchase
Contracts and to substitute Treasury Securities for such Notes shall be
responsible for any fees or expenses (including, without limitation, fees and
expenses payable to the Collateral Agent for its services as Collateral Agent)
in respect of the substitution, and neither the Company nor the Purchase
Contract Agent shall be responsible for any such fees or expenses.
If the Treasury Portfolio has replaced the Notes as a component of the
Corporate Units and subject to the conditions set forth in this Agreement, a
Holder may, at any time on or prior to the second Business Day immediately
preceding the Purchase Contract Settlement Date, substitute Treasury Securities
for the Applicable Ownership Interests in the Treasury Portfolio included in
such Corporate Units, but only in integral multiples of ______ Corporate Units.
In such an event, the Holder shall Transfer Treasury Securities having an
aggregate principal amount at maturity equal to the aggregate Stated Amount of
the Purchase Contracts underlying
29
such Corporate Units to the Collateral Agent, and the Purchase Contract Agent
shall instruct the Collateral Agent to release the Pledge of, and transfer to
the Holder, the appropriate Applicable Ownership Interests in the Treasury
Portfolio in the manner set forth above.
In the event a Holder making a Collateral Substitution pursuant to this
Section 3.13 fails to effect a book-entry transfer of the Corporate Units or
fails to deliver Corporate Units Certificates to the Purchase Contract Agent
after depositing Treasury Securities with the Collateral Agent, any
distributions on the Notes or Applicable Ownership Interest in the Treasury
Portfolio constituting a part of such Corporate Units shall be held in the name
of the Purchase Contract Agent or its nominee in trust for the benefit of such
Holder, until such Corporate Units are so transferred or the Corporate Units
Certificate is so delivered, as the case may be, or, such Holder provides
evidence satisfactory to the Company and the Purchase Contract Agent that such
Corporate Units Certificate has been destroyed, lost or stolen, together with
any indemnity that may be required by the Purchase Contract Agent and the
Company.
Except as described in Section 5.02 or in this Section 3.13 or in
connection with a Cash Settlement, an Early Settlement, a Cash Merger Early
Settlement or a Termination Event, for so long as the Purchase Contract
underlying a Corporate Unit remains in effect, such Corporate Units shall not be
separable into their constituent parts, and the rights and obligations of the
Holder in respect of the Notes or Applicable Ownership Interests in the Treasury
Portfolio, as the case may be, and the Purchase Contract comprising such
Corporate Units may be acquired, and may be transferred and exchanged, only as a
Corporate Unit.
SECTION 3.14. Recreation of Corporate Units.
Unless the Treasury Portfolio has replaced the Notes as a component of
the Corporate Units, and subject to the conditions set forth in this Agreement,
a Holder of Treasury Units may recreate Corporate Units at any time on or prior
to 5:00 p.m. (
New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date; provided that Holders of
Treasury Units may only recreate Corporate Units in integral multiples of ______
Treasury Units. To recreate Corporate Units, the Holder must:
(1) transfer to the Securities Intermediary Notes having an
aggregate principal amount equal to the aggregate principal
amount at stated maturity of the Treasury Securities
comprising part of the Treasury Units; and
(2) transfer the related Treasury Units to the Purchase
Contract Agent accompanied by a notice to the Purchase
Contract Agent, substantially in the form of Exhibit C
hereto, (i) stating that the Holder has transferred the
relevant amount of Notes to the Securities Intermediary and
(ii) requesting that the Purchase Contract Agent instruct
the Collateral Agent to release the Treasury Securities
underlying such Treasury Units, whereupon the Purchase
Contract Agent shall promptly provide an instruction to
such effect to the Collateral Agent, substantially in the
form of Exhibit C to the Pledge Agreement.
30
Upon receipt of the Notes described in clause (1) above and the
instruction described in clause (2) above, in accordance with the terms of the
Pledge Agreement, the Collateral Agent will cause the Securities Intermediary to
effect the release of the Treasury Securities having a corresponding aggregate
principal amount at maturity from the Pledge, free and clear of the Company's
security interest therein, and the transfer thereof to the Purchase Contract
Agent on behalf of the Holder. Upon receipt of such Treasury Securities, the
Purchase Contract Agent shall promptly:
(i) cancel the related Treasury Units;
(ii) transfer the Treasury Securities to the Holder; and
(iii) authenticate, execute on behalf of such Holder and deliver a
Corporate Unit Certificate executed by the Company in accordance with
Section 3.03 evidencing the same number of Purchase Contracts as were
evidenced by the cancelled Treasury Units.
Holders who elect to recreate Corporate Units shall be responsible for
any fees or expenses (including, without limitation, fees and expenses payable
to the Collateral Agent for its services as Collateral Agent) in respect of the
recreation, and neither the Company nor the Purchase Contract Agent shall be
responsible for any such fees or expenses.
If the Treasury Portfolio has replaced the Notes as a component of the
Corporate Units, a Holder may at any time on or prior to the second Business Day
immediately preceding the Purchase Contract Settlement Date substitute the
Applicable Ownership Interests in the Treasury Portfolio for Treasury
Securities, but only in multiples of ______ Treasury Units. In such an event,
the Holder shall Transfer to the Collateral Agent the Applicable Ownership
Interests in the Treasury Portfolio in an amount such that the aggregate
principal amount at maturity of the portion of such Applicable Ownership
Interests specified in clause (i) of the definition of such term is equal to the
aggregate Stated Amount of the Purchase Contracts underlying such Treasury
Units, and the Purchase Contract Agent shall instruct the Collateral Agent to
release the Pledge of, and transfer to the Holder, the appropriate Treasury
Securities in the manner set forth above.
Except as provided in Section 5.02 or in this Section 3.14 or in
connection with a Cash Settlement, an Early Settlement, a Cash Merger Early
Settlement or a Termination Event, for so long as the Purchase Contract
underlying a Treasury Unit remains in effect, such Treasury Unit shall not be
separable into its constituent parts and the rights and obligations of the
Holder of such Treasury Unit in respect of the 1/40 of a Treasury Security and
the Purchase Contract comprising such Treasury Unit may be acquired, and may be
transferred and exchanged, only as a Treasury Unit.
SECTION 3.15. Transfer of Collateral upon Occurrence of Termination
Event.
Upon the occurrence of a Termination Event and the transfer to the
Purchase Contract Agent of the Notes, the appropriate Applicable Ownership
Interests in the Treasury Portfolio or the Treasury Securities, as the case may
be, underlying the Corporate Units and the Treasury Units, as the case may be,
pursuant to the terms of the Pledge Agreement, the Purchase Contract
31
Agent shall request transfer instructions with respect to such Notes or the
appropriate Applicable Ownership Interests in the Treasury Portfolio or Treasury
Securities, as the case may be, from each Holder by written request,
substantially in the form of Exhibit D hereto, mailed to such Holder at its
address as it appears in the Security Register.
Upon book-entry transfer of the Corporate Units or the Treasury Units or
delivery of a Corporate Units Certificate or Treasury Units Certificate to the
Purchase Contract Agent with such transfer instructions, the Purchase Contract
Agent shall transfer the Notes, the appropriate Applicable Ownership Interests
in the Treasury Portfolio or Treasury Securities, as the case may be, underlying
such Corporate Units or Treasury Units, as the case may be, to such Holder by
book-entry transfer, or other appropriate procedures, in accordance with such
instructions. In the event a Holder of Corporate Units or Treasury Units fails
to effect such transfer or delivery, the Notes or the appropriate Applicable
Ownership Interests in the Treasury Portfolio or Treasury Securities, as the
case may be, underlying such Corporate Units or Treasury Units, as the case may
be, and any distributions thereon, shall be held in the name of the Purchase
Contract Agent or its nominee in trust for the benefit of such Holder, until the
earlier to occur of:
(i) the transfer of such Corporate Units or Treasury Units, the
surrender of the Corporate Units Certificate or Treasury Units
Certificate or the receipt by the Company and the Purchase Contract Agent
from such Holder of satisfactory evidence that such Corporate Units
Certificate or Treasury Units Certificate has been destroyed, lost or
stolen, together with any indemnity that may be required by the Purchase
Contract Agent and the Company; and
(ii) the expiration of the time period specified in the abandoned
property laws of the state in which the Purchase Contract Agent holds
such property.
SECTION 3.16. No Consent to Assumption.
Each Holder of a Unit, by acceptance thereof, shall be deemed expressly
to have withheld any consent to the assumption under Section 365 of the
Bankruptcy Code or otherwise, of the Purchase Contract by the Company or its
trustee, receiver, liquidator or a person or entity performing similar functions
in the event that the Company becomes the debtor under the Bankruptcy Code or
subject to other similar state or Federal law providing for reorganization or
liquidation.
SECTION 3.17. CUSIP Numbers.
The Company in issuing the Certificates may use "CUSIP" numbers (if then
generally in use), and, if so, the Purchase Contract Agent shall use "CUSIP"
numbers in notices of redemption as a convenience to Holders; PROVIDED that any
such notice may state that no representation is made as to the correctness of
such numbers either as printed on the Certificates or as contained in any notice
of a redemption and that reliance may be placed only on the other identification
numbers printed on the Certificates, and any such redemption shall not be
affected by any defect in or omission of such numbers. The Company will promptly
notify the Purchase Contract Agent of any change in the "CUSIP" numbers.
32
ARTICLE IV
THE NOTES AND APPLICABLE OWNERSHIP INTERESTS IN THE TREASURY PORTFOLIO
SECTION 4.01. Interest Payments; Rights to Interest Payments Preserved.
Any payment on any Note or on the appropriate Applicable Ownership
Interests (as specified in clause (ii) of the definition of such term) in the
Treasury Portfolio, as the case may be, which is paid on any Payment Date shall,
subject to receipt thereof by the Purchase Contract Agent from the Collateral
Agent as provided by the terms of the Pledge Agreement, be paid to the Person in
whose name the Corporate Units Certificate (or one or more Predecessor Corporate
Units Certificates) of which such Note or the appropriate Applicable Ownership
Interests in the Treasury Portfolio, as the case may be, forms a part is
registered at the close of business on the Record Date for such Payment Date.
Each Corporate Units Certificate evidencing Notes or the appropriate
Applicable Ownership Interests in the Treasury Portfolio delivered under this
Agreement upon registration of transfer of or in exchange for or in lieu of any
other Corporate Units Certificate shall carry the right to receive accrued and
unpaid interest or distributions, and to accrue future interest or
distributions, which were carried by the Notes or the appropriate Applicable
Ownership Interests in the Treasury Portfolio underlying such other Corporate
Units Certificate.
In the case of any Corporate Unit with respect to which (A) Cash
Settlement of the underlying Purchase Contract is properly effected pursuant to
Section 5.02 hereof, (B) Early Settlement of the underlying Purchase Contract is
properly effected pursuant to Section 5.07 hereof, (C) Cash Merger Early
Settlement of the underlying Purchase Contract is properly effected pursuant to
Section 5.04(b)(2) hereof, (D) a Collateral Substitution is properly effected
pursuant to Section 3.13, or (E) a Successful Initial Remarketing occurs with
respect to the Note that is part of such Corporate Unit, in each case on a date
that is after any Record Date and prior to or on the next succeeding Payment
Date, interest on the Notes or distributions on the appropriate Applicable
Ownership Interests in the Treasury Portfolio, as the case may be, underlying
such Corporate Unit otherwise payable on such Payment Date shall be payable on
such Payment Date notwithstanding such Cash Settlement, Early Settlement, Cash
Merger Early Settlement, Collateral Substitution or Initial Remarketing, and
such payment or distributions shall, subject to receipt thereof by the Purchase
Contract Agent, be payable to the Person in whose name the Corporate Units
Certificate (or one or more Predecessor Corporate Units Certificates) was
registered at the close of business on the Record Date.
Except as otherwise expressly provided in the immediately preceding
paragraph, in the case of any Corporate Units with respect to which Cash
Settlement, Early Settlement or Cash Merger Early Settlement of the underlying
Purchase Contract is properly effected, or with respect to which a Collateral
Substitution has been effected, payments on the related Notes or distributions
on the appropriate Applicable Ownership Interests in the Treasury Portfolio, as
the case may be, that would otherwise be payable or made after the Purchase
Contract Settlement Date, Early Settlement Date, Cash Merger Early Settlement
Date or the date of the Collateral Substitution, as the case may be, shall not
be payable hereunder to the Holder of such Corporate
33
Units; PROVIDED, HOWEVER, THAT to the extent that such Holder continues to hold
Separate Notes or Applicable Ownership Interest in the Treasury Portfolio that
formerly comprised a part of such Holder's Corporate Units, such Holder shall be
entitled to receive interest on such Separate Notes or distributions on the
Applicable Ownership Interests in the Treasury Portfolio.
SECTION 4.02. Notice and Voting.
Under the terms of the Pledge Agreement, the Purchase Contract Agent will
be entitled to exercise the voting and any other consensual rights pertaining to
the Pledged Notes, but only to the extent instructed in writing by the Holders
as described below. Upon receipt of notice of any meeting at which holders of
Notes are entitled to vote or upon any solicitation of consents, waivers or
proxies of holders of Notes, the Purchase Contract Agent shall, as soon as
practicable thereafter, mail, first class, postage pre-paid, to the Holders of
Corporate Units a notice:
(i) containing such information as is contained in the notice or
solicitation;
(ii) stating that each Holder on the record date set by the
Purchase Contract Agent therefor (which, to the extent possible, shall be
the same date as the record date for determining the holders of Notes, as
the case may be, entitled to vote) shall be entitled to instruct the
Purchase Contract Agent as to the exercise of the voting rights
pertaining to such Notes underlying their Corporate Units; and
(iii) stating the manner in which such instructions may be given.
Upon the written request of the Holders of Corporate Units on such record
date received by the Purchase Contract Agent at least six days prior to such
meeting, the Purchase Contract Agent shall endeavor insofar as practicable to
vote or cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of Notes, as the case may be, as to which any
particular voting instructions are received. In the absence of specific
instructions from the Holder of a Corporate Unit, the Purchase Contract Agent
shall abstain from voting the Notes underlying such Corporate Unit. The Company
hereby agrees, if applicable, to solicit Holders of Corporate Units to timely
instruct the Purchase Contract Agent in order to enable the Purchase Contract
Agent to vote such Notes.
The Holders of Corporate Units and Treasury Units shall have no voting or
other rights in respect of Ordinary Shares.
SECTION 4.03. Special Event Redemption.
(a) If the Company elects to redeem the Notes on any Payment Date
following the occurrence of a Special Event as permitted by the Indenture, it
shall notify the Collateral Agent in writing of such occurrence, of its
intention to redeem the Notes and of the Special Event Redemption Date. On the
Special Event Redemption Date, the Collateral Agent shall surrender the Pledged
Notes to the Indenture Trustee against delivery of an amount equal to the
aggregate Redemption Price for such Pledged Notes. Thereafter, pursuant to the
terms of the Pledge Agreement, the Collateral Agent shall cause the Securities
Intermediary to apply an amount equal to the aggregate Redemption Amount of such
funds to purchase on behalf of the Holders of
34
Corporate Units the Treasury Portfolio and promptly remit the remaining portion
of such funds to the Purchase Contract Agent for payment to the Holders of such
Corporate Units.
(b) Upon the occurrence of a Special Event Redemption, (i) the Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio will be substituted as Collateral for the Pledged
Notes and will be held by the Collateral Agent in accordance with the terms of
the Pledge Agreement to secure the obligation of each Holder of a Corporate Unit
to purchase the Ordinary Shares of the Company under the Purchase Contract
constituting a part of such Corporate Unit, (ii) the Holders of Corporate Units
and the Collateral Agent shall have such security interest rights and
obligations with respect to such Applicable Ownership Interests (as specified in
clause (i) of the definition of such term) as the Holders of Corporate Units and
the Collateral Agent had in respect of the Notes, as the case may be, subject to
the Pledge thereof as provided in the Pledge Agreement, and (iii) any reference
herein to the Notes shall be deemed to be a reference to such Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio. The Company may cause to be made in any Corporate
Units Certificates thereafter to be issued such change in phraseology and form
(but not in substance) as may be appropriate to reflect the substitution of the
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio for Notes as Collateral.
(c) The Holders of Separate Notes shall directly receive the redemption
price for the Separate Notes.
ARTICLE V
THE PURCHASE CONTRACTS
SECTION 5.01. Purchase of Shares of Ordinary Shares.
(a) Each Purchase Contract shall obligate the Holder of the related Units
to purchase, and the Company to sell, on the Purchase Contract Settlement Date
at a price equal to the Stated Amount (the "Purchase Price"), a number of newly
issued shares of Ordinary Shares (subject to Section 5.09) equal to the
Settlement Rate unless an Early Settlement, a Cash Merger Early Settlement or a
Termination Event with respect to the Units of which such Purchase Contract is a
part shall have occurred. The "Settlement Rate" is equal to:
(i) if the Adjusted Applicable Market Value (as defined below) is
greater than or equal to $______ (the "Threshold Appreciation Price"),
______shares of Ordinary Shares per Purchase Contract;
(ii) if the Adjusted Applicable Market Value is less than the
Threshold Appreciation Price but greater than $______ (the "Reference
Price"), the number of shares of Ordinary Shares per Purchase Contact
having a value equal to the Stated Amount divided by the Adjusted
Applicable Market Value;
(iii) if the Adjusted Applicable Market Value is less than or
equal to the Reference Price, ______ shares of Ordinary Shares per
Purchase Contract;
35
in each case subject to adjustment as provided in Section 5.04 (and in each case
rounded upward or downward to the nearest 1/10,000th of a share).
The "APPLICABLE MARKET VALUE" means the average of the Closing Price per
share of Ordinary Shares on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date, subject to adjustments set forth under Section 5.04 hereof.
The "ADJUSTED APPLICABLE MARKET VALUE" means (i) prior to any adjustment
of the Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7)
or (10) of Section 5.04(a), the Applicable Market Value, and (ii) at the time of
and after any adjustment of the Settlement Rate pursuant to paragraph (1), (2),
(3), (4), (5), (6), (7) or (10) of Section 5.04(a), the Applicable Market Value
multiplied by a fraction of which the numerator shall be the Settlement Rate
immediately after such adjustment pursuant to paragraph (1), (2), (3), (4), (5),
(6), (7) or (10) of Section 5.04(a) and the denominator shall be the Settlement
Rate immediately prior to such adjustment; provided, however, that if such
adjustment to the Settlement Rate is required to be made pursuant to the
occurrence of any of the events contemplated by paragraph (1), (2), (3), (4),
(5), (6), (7) and (10) of Section 5.04(a) during the period taken into
consideration for determining the Applicable Market Value, appropriate and
customary adjustments shall be made to the Settlement Rate.
The "CLOSING PRICE" per share of Ordinary Shares on any date of
determination means:
(i) the closing sale price as of the close of the principal
trading session (or, if no closing price is reported, the last reported
sale price) per share on the
New York Stock Exchange, Inc. (the "NYSE")
on such date;
(iv) if the Ordinary Shares are not listed for trading on the NYSE
on any such date, the closing sale price (or, if no closing price is
reported, the last reported sale price) per share as reported in the
composite transactions for the principal United States national or
regional securities exchange on which the Ordinary Shares are so listed;
(v) if the Ordinary Shares are not so listed on a United States
national or regional securities exchange, the last closing sale price per
share as reported by The Nasdaq National Market, Inc.;
(vi) if the Ordinary Shares are not so reported by the Nasdaq
National Market, Inc., the last quoted bid price for the Ordinary Shares
in the over-the-counter market as reported by the National Quotation
Bureau or similar organization; or
(vii) if the bid price referred to in clause (iv) is not
available, the market value of Ordinary Shares on such date as determined
by a nationally recognized independent investment banking firm retained
by the Company for purposes of determining the Closing Price.
A "TRADING DAY" means a day on which the Ordinary Shares (1) are not
suspended from trading on any national or regional securities exchange or
association or over-the-counter
36
market at the close of business and (2) have traded at least once on the
national or regional securities exchange or association or over-the-counter
market that is the primary market for the trading of the Ordinary Shares.
(b) Each Holder of a Corporate Unit or a Treasury Unit, by its acceptance
of such Unit:
(i) irrevocably authorizes the Purchase Contract Agent to enter
into and perform the related Purchase Contract on its behalf as its
attorney-in-fact (including, without limitation, the execution of
Certificates on behalf of such Holder);
(ii) agrees to be bound by the terms and provisions thereof;
(iii) covenants and agrees to perform its obligations under such
Purchase Contract for so long as such Holder remains a Holder of a
Corporate Unit or a Treasury Unit;
(iv) consents to the provisions hereof;
(v) irrevocably authorizes the Purchase Contract Agent to enter
into and perform this Agreement and the Pledge Agreement on its behalf
and in its name as its attorney-in-fact;
(vi) consents to, and agrees to be bound by, the Pledge of such
Holder's right, title and interest in and to the Collateral Account,
including the Notes and the Applicable Ownership Interests (as specified
in clause (i) of the definition of such term) in the Treasury Portfolio
or the Treasury Securities pursuant to the Pledge Agreement; and
(vii) for United States federal, state and local income and
franchise tax purposes, agrees to (i) treat an acquisition of the
Corporate Units as an acquisition of the Note and Purchase Contract
constituting the Corporate Units, (ii) treat the Notes as indebtedness
and (iii) treat itself as the owner of the applicable interest in the
Collateral Account, including the Notes and the Applicable Ownership
Interests in the Treasury Portfolio (as specified in clause (i) of the
definition of such term) or the Treasury Securities,
provided that upon a Termination Event, the rights of the Holder of such Units
under the Purchase Contract may be enforced without regard to any other rights
or obligations.
(c) Each Holder of a Corporate Unit or a Treasury Unit, by its acceptance
thereof, further covenants and agrees that to the extent and in the manner
provided in Section 5.02 and the Pledge Agreement, but subject to the terms
thereof, Proceeds of the Notes, the Treasury Securities or the Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, as applicable, on the Purchase Contract Settlement
Date, shall be paid by the Collateral Agent to the Company in satisfaction of
such Holder's obligations under such Purchase Contract and such Holder shall
acquire no right, title or interest in such Proceeds.
37
(d) Upon registration of transfer of a Certificate, the transferee shall
be bound (without the necessity of any other action on the part of such
transferee) by the terms of this Agreement, the Purchase Contracts underlying
such Certificate and the Pledge Agreement and the transferor shall be released
from the obligations under this Agreement, the Purchase Contracts underlying the
Certificate so transferred and the Pledge Agreement. The Company covenants and
agrees, and each Holder of a Certificate, by its acceptance thereof, likewise
covenants and agrees, to be bound by the provisions of this paragraph.
SECTION 5.02. Remarketing; Payment of Purchase Price.
(a) (i) Unless a Special Event Redemption has occurred prior to the
Initial Remarketing Date, the Company shall engage the Remarketing Agent
pursuant to the Remarketing Agreement for Remarketing the Notes. By 11:00 a.m.
(
New York City time) on the Business Day immediately preceding the Initial
Remarketing Date, Collateral Agent shall present the related Pledged Notes to
the Remarketing Agent for Initial Remarketing (as defined below), and the
Custodial Agent shall notify the Remarketing Agent of the aggregate principal
amount of Separate Notes (if any) that are to be remarketed pursuant to clause
(ii) below. Concurrently, the Collateral Agent, pursuant to the terms of the
Pledge Agreement, will present for Remarketing the Pledged Notes, and the
Custodial Agent, pursuant to clause (ii) below, will present for Remarketing the
Separate Notes, to the Remarketing Agent. Upon receipt of such notice from the
Purchase Contract Agent and Custodial Agent and the Pledged Notes and Separate
Notes (if any) from the Collateral Agent and Custodial Agent, the Remarketing
Agent will, on the Initial Remarketing Date, use its reasonable efforts to
remarket (based on the Reset Rate) (the "Initial Remarketing") such Pledged
Notes and Separate Notes on such date at a price of approximately ______% (or,
if the Remarketing Agent is unable to remarket the Pledged Notes and Separate
Notes at such rate, at a rate below ______% in the discretion of the Remarketing
Agent, but in no event less than 100%, net of any Remarketing Fee and any other
fees and commissions) of the sum of the Treasury Portfolio Purchase Price plus
the Separate Notes Purchase Price. If the Remarketing Agent is able to remarket
the Pledged Notes and Separate Notes at a price equal to or greater than 100%
(net of any Remarketing Fee and any other fees and commissions) of the Treasury
Portfolio Purchase Price plus the Separate Notes Purchase Price (a "Successful
Initial Remarketing"), the portion of the proceeds from such Successful Initial
Remarketing equal to the Treasury Portfolio Purchase Price will be applied to
purchase the Treasury Portfolio. The Remarketing Agent shall deduct as a
remarketing fee (the "Remarketing Fee") an amount equal to the lesser of (i) 25
basis points (0.25%) of the sum of the Treasury Portfolio Purchase Price plus
the Separate Notes Purchase Price and (ii) the amount of the proceeds of such
Remarketing in excess of the sum of the Treasury Portfolio Purchase Price plus
the Separate Notes Purchase Price. None of the Company, the Purchase Contract
Agent, or any Holders of Corporate Units or holders of Separate Notes whose
Notes or Separate Notes are so remarketed will otherwise be responsible for the
payment of any Remarketing Fee in connection therewith. With respect to Separate
Notes, any proceeds of the Initial Remarketing in excess of the Remarketing Fee
attributable to the Separate Notes will be remitted to the Custodial Agent for
payment to the holders of Separate Notes. With respect to Pledged Notes, any
proceeds of the Initial Remarketing in excess of the sum of the Treasury
Portfolio Purchase Price plus the Remarketing Fee with respect to such Pledged
Notes will be remitted to the Purchase Contract Agent for payment to the Holders
of the related Corporate Units. The Treasury Portfolio will be substituted for
the Pledged Notes and the appropriate Applicable Ownership Interests (as
38
specified in clause (i) of the definition of such term) in the Treasury
Portfolio will be pledged to the Collateral Agent to secure the obligation of
the Holders of Corporate Units to pay the Purchase Price for the Ordinary Shares
under the related Purchase Contracts on the Purchase Contract Settlement Date.
Following the occurrence of a Successful Initial Remarketing, the Holders
of Corporate Units and the Collateral Agent shall have such security interests,
rights and obligations with respect to the Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio as the Holder of Corporate Units and the Collateral Agent had in
respect of the Notes, subject to the Pledge thereof as provided in the Pledge
Agreement, and any reference herein or in the Certificates to the Notes shall be
deemed to be a reference to such Applicable Ownership Interests in the Treasury
Portfolio and any reference herein or in the Certificates to interest on the
Notes shall be deemed to be a reference to corresponding distributions on such
Applicable Ownership Interests in the Treasury Portfolio. The Company may cause
to be made in any Corporate Units Certificates thereafter to be issued such
change in phraseology and form (but not in substance) as may be appropriate to
reflect the substitution of such Applicable Ownership Interests in the Treasury
Portfolio for Notes.
If, in spite of using its reasonable efforts, the Remarketing Agent
cannot remarket the Pledged Notes and the Separate Notes (if any) in the Initial
Remarketing (other than to the Company) at a price not less than 100% (net of
any Remarketing Fee and any other fees and commissions) of the sum of the
Treasury Portfolio Purchase Price plus the Separate Notes Purchase Price or a
condition precedent set forth in the Remarketing Agreement is not fulfilled, the
Initial Remarketing will be deemed to have failed (a "Failed Initial
Remarketing"). Upon a Failed Initial Remarketing, the Remarketing Agent shall
return the Pledged Notes and Separate Notes (if any) subject to such Remarketing
to the Collateral Agent or the Custodial Agent, as the case may be.
(ii) Prior to 5:00 p.m. (
New York City time) on the fifth Business
Day immediately preceding the applicable Remarketing Date, but no earlier
than the Payment Date immediately preceding such date, Holders of
Separate Notes may elect to have their Separate Notes remarketed under
the Remarketing Agreement by delivering their Separate Notes, along with
a notice of such election, substantially in the form of Exhibit F to the
Pledge Agreement, to the Custodial Agent. After such time, such election
shall become an irrevocable election to have such Separate Notes
remarketed in such Remarketing and, if such Remarketing fails, in any
subsequent Remarketing. The Custodial Agent shall hold Separate Notes in
an account separate from the Collateral Account in which the Pledged
Notes (as defined in the Pledge Agreement) shall be held. Holders of
Separate Notes electing to have their Separate Notes remarketed will also
have the right to withdraw that election by written notice to the
Custodial Agent, substantially in the form of Exhibit G to the Pledge
Agreement, on or prior to 5:00 p.m. (New York City time) on the fifth
Business Day immediately preceding the applicable Remarketing Date, upon
which notice the Custodial Agent shall return such Separate Notes to such
Holder. Promptly after 11:00 a.m. on the Business Day immediately
preceding the applicable Remarketing Date, 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 such Separate
39
Notes delivered to the Custodial Agent pursuant to Section 5.07(c) of the
Pledge Agreement and not validly withdrawn prior to such date.
(iii) Not later than seven calendar days nor more than 15 calendar
days prior to the applicable Remarketing Date, the Company shall request
the Depositary or its nominee to notify the Beneficial Owners or
Depositary Participants holding Units of the procedures to be followed in
such Remarketing.
(iv) The Company agrees to use commercially reasonable efforts to
ensure that, if required by applicable law, a registration statement with
regard to the full amount of the Notes to be remarketed in the Initial
Remarketing, the Second Remarketing, the Third Remarketing or the Final
Remarketing, as the case may be, shall be effective with the Securities
and Exchange Commission in a form that will enable the Remarketing Agent
to rely on it in connection with such Remarketing.
(v) The Company shall cause a notice of a Failed Remarketing to be
published (with a copy of such notice to be provided to the Purchase
Contract Agent) on the Business Day immediately following the applicable
Remarketing Date, in a daily newspaper in the English language of general
circulation in The City of New York, which is expected to be The Wall
Street Journal.
(b) (i) Unless a Special Event Redemption has occurred prior to the
Second Remarketing Date, if a Failed Initial Remarketing occurs, the Remarketing
Agent will use its reasonable efforts to remarket the Notes (a "Second
Remarketing") on the Second Remarketing Date. By 11:00 a.m. (New York City time)
on the Business Day immediately preceding the Second Remarketing Date for such
Second Remarketing, the Purchase Contract Agent shall notify the Remarketing
Agent of the aggregate principal amount of Pledged Notes, and the Custodial
Agent shall notify the Remarketing Agent of the aggregate principal amount of
Separate Notes (if any) that are to be remarketed pursuant to Section
5.02(a)(ii). Concurrently, the Collateral Agent, pursuant to the terms of the
Pledge Agreement, and the Custodial Agent, pursuant to Section 5.02(a)(ii), will
present for Remarketing the Pledged Notes and the Separate Notes (if any) that
are to be remarketed to the Remarketing Agent. Upon receipt of such notice from
the Purchase Contract Agent and the Custodial Agent and Pledged Notes and
Separate Notes (if any) from the Collateral Agent and the Custodial Agent, the
Remarketing Agent will, on the Second Remarketing Date, use its reasonable
efforts to remarket (based on the Reset Rate) such Pledged Notes and Separate
Notes on such date at a price of approximately ______% (or, if the Remarketing
Agent is unable to remarket the Pledged Notes and Separate Notes at such rate,
at a rate below ______% in the discretion of the Remarketing Agent, but in no
event less than 100%, net of any Remarketing Fee and any other fees and
commissions) of the sum of the Treasury Portfolio Purchase Price plus the
Separate Notes Purchase Price. If the Remarketing Agent is able to remarket the
Pledged Notes and Separate Notes at a price equal to or greater than 100% (net
of any Remarketing Fee and any other fees and commissions) of the Treasury
Portfolio Purchase Price plus the Separate Notes Purchase Price (a "Successful
Second Remarketing"), the portion of the proceeds from such Successful Second
Remarketing equal to the Treasury Portfolio Purchase Price will be applied to
purchase the Treasury Portfolio. The Remarketing Agent shall deduct the
Remarketing Fee from any amount of such proceeds in excess of the sum of the
Treasury Portfolio Purchase Price plus the Separate Notes Purchase
40
Price. None of the Company, the Purchase Contract Agent or any Holders of
Corporate Units or holders of Separate Notes whose Notes or Separate Notes are
so remarketed will otherwise be responsible for the payment of any Remarketing
Fee in connection therewith. With respect to Separate Notes, any proceeds of the
Second Remarketing in excess of the Remarketing Fee attributable to the Separate
Notes will be remitted to the Custodial Agent for payment to the holders of
Separate Notes. With respect to Pledged Notes, any proceeds of the Second
Remarketing in excess of the sum of the Treasury Portfolio Purchase Price plus
the Remarketing Fee with respect to such Pledged Notes will be remitted to the
Purchase Contract Agent for payment to the Holders of the related Corporate
Units. The Treasury Portfolio will be substituted for the Pledged Notes and the
appropriate Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio will be pledged to the
Collateral Agent to secure the obligation of the Holders of Corporate Units to
pay the Purchase Price for the Ordinary Shares under the related Purchase
Contracts on the Purchase Contract Settlement Date.
Following the occurrence of a Successful Second Remarketing, the Holders
of Corporate Units and the Collateral Agent shall have such security interests,
rights and obligations with respect to the Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio as the Holder of Corporate Units and the Collateral Agent had in
respect of the Notes, subject to the Pledge thereof as provided in the Pledge
Agreement, and any reference herein or in the Certificates to the Notes shall be
deemed to be a reference to such Applicable Ownership Interests in the Treasury
Portfolio and any reference herein or in the Certificates to interest on the
Notes shall be deemed to be a reference to corresponding distributions on such
Applicable Ownership Interests in the Treasury Portfolio. The Company may cause
to be made in any Corporate Units Certificates thereafter to be issued such
change in phraseology and form (but not in substance) as may be appropriate to
reflect the substitution of such Applicable Ownership Interests in the Treasury
Portfolio for Notes.
If, in spite of using its reasonable efforts, the Remarketing Agent
cannot remarket the Pledged Notes and Separate Notes (if any) in a Second
Remarketing (other than to the Company) at a price not less than 100% (net of
any Remarketing Fee and any other fees and commissions) of the sum of the
Treasury Portfolio Purchase Price plus the Separate Notes Purchase Price or a
condition precedent set forth in the Remarketing Agreement is not fulfilled, the
Second Remarketing will be deemed to have failed (a "Failed Second
Remarketing"). Upon a Failed Second Remarketing, the Remarketing Agent shall
return the Pledged Notes and the Separate Notes (if any) subject to such
Remarketing to the Collateral Agent or the Custodial Agent, as the case may be.
(ii) Unless a Special Event Redemption has occurred prior to the
Third Remarketing Date, if a Failed Second Remarketing occurs, the
Remarketing Agent will use its reasonable efforts to remarket the Notes
(a "Third Remarketing") on the Third Remarketing Date. By 11:00 a.m. (New
York City time) on the Business Day immediately preceding the Third
Remarketing Date for such Third Remarketing, the Purchase Contract Agent
shall notify the Remarketing Agent of the aggregate principal amount of
Pledged Notes, and the Custodial Agent shall notify the
41
Remarketing Agent of the aggregate principal amount of Separate Notes (if
any) that are to be remarketed pursuant to Section 5.02(a)(ii).
Concurrently, the Collateral Agent, pursuant to the terms of the Pledge
Agreement, and the Custodial Agent, pursuant to Section 5.02(a)(ii), will
present for Remarketing the Pledged Notes and the Separate Notes (if any) that
are to be remarketed to the Remarketing Agent. Upon receipt of such notice from
the Purchase Contract Agent and the Custodial Agent and such Pledged Notes and
Separate Notes from the Collateral Agent and the Custodial Agent, the
Remarketing Agent will, on the Third Remarketing Date, use its reasonable
efforts to remarket (based on the Reset Rate) such Pledged Notes and the
Separate Notes on such date at a price of approximately ______% (or, if the
Remarketing Agent is unable to remarket the Pledged Notes and the Separate Notes
at such rate, at a rate below ______% in the discretion of the Remarketing
Agent, but in no event less than 100%, net of any Remarketing Fee and any other
fees and commissions) of the sum of the Treasury Portfolio Purchase Price plus
the Separate Notes Purchase Price. If the Remarketing Agent is able to remarket
the Pledged Notes and the Separate Notes at a price equal to or greater than
100% (net of any Remarketing Fee and any other fees and commissions) of the
Treasury Portfolio Purchase Price plus the Separate Notes Purchase Price (a
"Successful Third Remarketing"), the portion of the proceeds from such
Successful Third Remarketing equal to the Treasury Portfolio Purchase Price will
be applied to purchase the Treasury Portfolio. The Remarketing Agent shall
deduct the Remarketing Fee from any amount of such proceeds in excess of the sum
of the Treasury Portfolio Purchase Price plus the Separate Notes Purchase Price.
None of the Company, the
Purchase Contract Agreement or any Holders of Corporate
Units or holders of Separate Notes whose Notes or Separate Notes are so
remarketed will otherwise be responsible for the payment of any Remarketing Fee
in connection therewith. With respect to Separate Notes, any proceeds of the
Third Remarketing in excess of the Remarketing Fee attributable to the Separate
Notes will be remitted to the Custodial Agent for payment to the holders of
Separate Notes. With respect to Pledged Notes, any proceeds of the Third
Remarketing in excess of the sum of the Treasury Portfolio Purchase Price plus
the Remarketing Fee with respect to such Pledged Notes will be remitted to the
Purchase Contract Agent for payment to the Holders of the related Corporate
Units. The Treasury Portfolio will be substituted for the Pledged Notes and the
appropriate Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio will be pledged to the
Collateral Agent to secure the obligation of the Holders of Corporate Units to
pay the Purchase Price for the Ordinary Shares under the related Purchase
Contracts on the Purchase Contract Settlement Date.
Following the occurrence of a Successful Third Remarketing, the Holders
of Corporate Units and the Collateral Agent shall have such security interests
(with respect to the Collateral Agent), rights and obligations with respect to
the Applicable Ownership Interests (as specified in clause (i) of the definition
of such term) in the Treasury Portfolio as the Holder of Corporate Units and the
Collateral Agent had in respect of the Notes, subject to the Pledge thereof as
provided in the Pledge Agreement, and any reference herein or in the
Certificates to the Notes shall be deemed to be a reference to such Applicable
Ownership Interests in the Treasury Portfolio and any reference herein or in the
Certificates to interest on the Notes shall be deemed to be a reference to
corresponding distributions on such Applicable Ownership Interests in the
Treasury Portfolio. The Company may cause to be made in any Corporate Units
Certificates thereafter to be issued such change in phraseology and form (but
not in substance) as may be
42
appropriate to reflect the substitution of such Applicable Ownership Interests
in the Treasury Portfolio for Notes.
If, in spite of using its reasonable efforts, the Remarketing Agent
cannot remarket the Pledged Notes and the Separate Notes (if any) in a Third
Remarketing (other than to the Company) at a price not less than 100% (net of
any Remarketing Fee and any other fees and commissions) of the sum of the
Treasury Portfolio Purchase Price plus the Separate Notes Purchase Price or a
condition precedent set forth in the Remarketing Agreement is not fulfilled, the
Third Remarketing will be deemed to have failed (a "Failed Third Remarketing").
Upon a Failed Third Remarketing, the Remarketing Agent shall return the Pledged
Notes and the Separate Notes (if any) subject to such Remarketing to the
Collateral Agent or the Custodial Agent, as the case may be.
(c) (i) Unless a Special Event Redemption, an Early Settlement or a Cash
Merger Early Settlement has occurred prior to the Final Remarketing Date, if no
Successful Remarketing has occurred prior to the Final Remarketing Date, each
Holder shall have the right to satisfy such Holder's obligations under the
Purchase Contract on the Purchase Contract Settlement Date in cash by notifying
the Purchase Contract Agent by use of a notice in substantially the form of
Exhibit E hereto of its intention to pay in cash ("Cash Settlement") prior to
5:00 p.m. (New York City time) on the fifth Business Day immediately preceding
the Purchase Contract Settlement Date.
Promptly following 5:00 p.m. (New York City time) on the fifth Business
Day immediately preceding the Purchase Contract Settlement Date, the Purchase
Contract Agent shall notify the Collateral Agent and the Indenture Trustee of
the receipt of such notices from Holders intending to make a Cash Settlement.
(ii) A Holder of a Corporate Unit who has so notified the Purchase
Contract Agent of its intention to effect a Cash Settlement shall pay the
Purchase Price to the Securities Intermediary for deposit in the
Collateral Account prior to 5:00 p.m. (New York City time) on the fourth
Business Day immediately preceding the Purchase Contract Settlement Date,
in lawful money of the United States by certified or cashiers' check or
wire transfer, in each case in immediately available funds payable to or
upon the order of the Securities Intermediary. Any cash received by the
Collateral Agent shall be invested promptly by the Securities
Intermediary in Permitted Investments pursuant to written instructions
received from the Company and paid to the Company on the Purchase
Contract Settlement Date in settlement of the Purchase Contracts in
accordance with the terms of this Agreement and the Pledge Agreement. Any
funds received by the Securities Intermediary in respect of the
investment earnings from such Permitted Investments in excess of the
Purchase Price for the shares of Ordinary Shares to be purchased by such
Holder shall be distributed to the Purchase Contract Agent when received
for payment to the Holder.
(iii) If a Holder of a Corporate Unit does not notify the Purchase
Contract Agent of its intention to make a Cash Settlement in accordance
with paragraph 5.02(c)(i) above, or does notify the Purchase Contract
Agent in accordance with paragraph 5.02(c)(i) above but fails to make
such payment as required by paragraph 5.02(c)(ii)
43
above, such Holder shall be deemed to have consented to the disposition
of the Pledged Notes pursuant to the Final Remarketing as described in
paragraph 5.02(d) below.
(iv) Promptly after 5:00 p.m. (New York City time) on the fourth
Business Day preceding the Purchase Contract Settlement Date, the
Collateral Agent, based on cash payments received by the Collateral Agent
pursuant to Section 5.02(c)(ii) hereof, shall promptly notify the
Purchase Contract Agent and the Indenture Trustee of the aggregate
principal amount of Notes to be tendered for purchase in the Remarketing
in a notice pursuant to the terms of the Pledge Agreement.
(d) (i) Unless a Special Event Redemption, an Early Settlement or a Cash
Merger Early Settlement has occurred prior to the Final Remarketing Date, if a
Failed Third Remarketing has occurred, the Notes of such Holders of Corporate
Units who have not notified the Purchase Contract Agent of their intention to
effect a Cash Settlement as provided in paragraph 5.02(c)(i) above, or who have
so notified the Purchase Contract Agent in accordance with paragraph 5.02(c)(i)
above but have failed to make such payment as required by paragraph 5.02(c)(ii)
above, and the Separate Notes of any holder who has elected for its Separate
Notes to be remarketed pursuant to Section 5.02(a)(ii) will be sold by the
Remarketing Agent (the "Final Remarketing") on the third Business Day
immediately preceding the Purchase Contract Settlement Date (the "Final
Remarketing Date"). In order to facilitate the Final Remarketing, the Purchase
Contract Agent, based on the notices specified in Section 5.02(c)(iv), and the
Collateral Agent, based on the notices specified in Section 5.02(a)(ii), shall
notify the Remarketing Agent, by 11:00 a.m. (New York City time) on the Business
Day immediately preceding the Final Remarketing Date, of the aggregate principal
amount of Pledged Notes or aggregate principal amount of Separate Notes that are
to be remarketed pursuant to Section 5.02(a)(ii), as the case may be, to be
remarketed. Concurrently, the Collateral Agent, pursuant to the terms of the
Pledge Agreement, and the Custodial Agent shall cause such Pledged Notes and
Separate Notes to be presented to the Remarketing Agent for Remarketing.
(ii) Upon receipt of such notice from the Purchase Contract Agent
and the Collateral Agent and the Pledged Notes and Separate Notes (if
any) from the Collateral Agent or Custodial Agent, as set forth in clause
(i) above, the Remarketing Agent shall, on the Final Remarketing Date,
use its reasonable efforts to remarket (based on the Reset Rate) such
Pledged Notes and the Separate Notes on such date at a price equal to
approximately ______% (or, if the Remarketing Agent is unable to remarket
the Pledged Notes and the Separate Notes at such rate, at a rate below
______% in the discretion of the Remarketing Agent, but in no event less
than 100%, net of the Final Remarketing Fee and any other fees and
commissions) of the aggregate principal amount of such Notes and Separate
Notes being remarketed, as provided in the Remarketing Agreement. If the
Remarketing Agent is able to remarket the Notes and Separate Notes at a
price equal to or greater than 100% (net of the Final Remarketing Fee and
any other fees and commissions) of the aggregate principal amount of the
Notes and Separate Notes (if any) (a "Successful Final Remarketing"), the
Remarketing Agent will remit the proceeds attributable to the Remarketing
of the Pledged Notes from such Successful Final Remarketing to the
Collateral Agent. The Remarketing Agent shall deduct as the remarketing
fee (the "Final Remarketing Fee") an amount equal to the lesser of (i)
______ basis points (______%) of the aggregate principal amount of the
remarketed
44
Pledged Notes and Separate Notes (if any) and (ii) the amount of the
proceeds of a Successful Final Remarketing in excess of the aggregate
principal amount of the remarketed Pledged Notes and Separate Notes (if
any). With respect to Separate Notes, any proceeds of the Final
Remarketing in excess of the Final Remarketing Fee attributable to the
Separate Notes will be remitted to the Custodial Agent for payment to the
holders of Separate Notes. The proceeds from the Remarketing remitted to
the Collateral Agent shall be invested by the Collateral Agent in
Permitted Investments, in accordance with the Pledge Agreement, and then
applied to satisfy in full the obligations of such Holders of Corporate
Units to pay the Purchase Price for the shares of Ordinary Shares under
the related Purchase Contracts, less the amount of any Deferred Contract
Adjustment Payments payable to such Holders, on the Purchase Contract
Settlement Date. Any proceeds in excess of those required to pay the
Purchase Price and the Final Remarketing Fee will be remitted to the
Purchase Contract Agent for payment to the Holders of the related
Corporate Units.
(iii) If, in spite of using its reasonable efforts, the
Remarketing Agent cannot remarket the Pledged Notes and Separate Notes
(if any) at a price not less than 100% (net of the Final Remarketing Fee
and any other fees and commissions) of the aggregate principal amount of
the Pledged Notes and Separate Notes to be remarketed in the Final
Remarketing (other than to the Company) or a condition precedent set
forth in the Remarketing Agreement is not fulfilled, the remarketing will
be deemed to have failed (a "Failed Final Remarketing"). Upon a Failed
Final Remarketing, the Remarketing Agent shall return the Pledged Notes
and Separate Notes (if any) to the Collateral Agent or the Custodial
Agent, as the case may be. Upon a Failed Final Remarketing, a default
shall be deemed to have occurred under this Agreement and the Pledge
Agreement and in accordance with the terms of the Pledge Agreement, the
Collateral Agent, for the benefit of the Company, shall exercise its
rights as a secured party with respect to the Pledged Notes, including,
without limitation, those actions specified in paragraph 5.02(e)(i)
below; PROVIDED, THAT if upon a Failed Final Remarketing, the Collateral
Agent exercises such rights for the benefit of the Company with respect
to such Notes, any accrued and unpaid interest on such Notes, including
any Deferred Interest, shall become payable by the Company to the
Purchase Contract Agent for payment to the Beneficial Owner of the
Corporate Units to which such Notes relate.
(e) With respect to any Pledged Notes which are subject to a Failed Final
Remarketing, resulting in an event of default under this Agreement, the
Collateral Agent for the benefit of the Company reserves all of its rights as a
secured party with respect thereto and, subject to applicable law and paragraph
5.02(i) below, may, in full satisfaction of the Holders' obligations under the
Purchase Contracts among other things, (A) retain the Notes in accordance with
applicable law or (B) dispose of the Notes in accordance with applicable law,
which in each case shall constitute payment in full for the aggregate Purchase
Price for the shares of Ordinary Shares to be purchased under the Purchase
Contracts.
(f) In the case of a Treasury Unit or a Corporate Unit (if the Treasury
Portfolio has replaced the Note as a component of such Corporate Unit), upon the
maturity of the Pledged Treasury Securities or the appropriate Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio held by the Securities Intermediary on or
45
prior to the Business Day immediately preceding the Purchase Contract Settlement
Date, the principal amount of the Treasury Securities or the appropriate
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio received by the Collateral Agent shall be
invested promptly in Permitted Investments. On the Purchase Contract Settlement
Date, an amount equal to the Purchase Price, less the amount of any Deferred
Contract Adjustment Payments payable to such Holders, shall be remitted to the
Company as payment of such Holder's obligation under the related Purchase
Contracts without receiving any instructions from the Holder. In the event the
sum of the Proceeds from the related Pledged Treasury Securities or the
appropriate Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio and the Proceeds from such
Permitted Investments is in excess of the aggregate Purchase Price, less the
amount of any Deferred Contract Adjustment Payments payable to such Holders, the
Collateral Agent shall cause the Securities Intermediary to distribute such
excess to the Purchase Contract Agent for the benefit of the Holder of the
related Treasury Units or Corporate Units when received.
(g) Any distribution to Holders of any payments described above shall be
payable at the office of the Purchase Contract Agent in New York City maintained
for that purpose or, at the option of the Holder, by check mailed to the address
of the Person entitled thereto at such address as it appears on the Security
Register.
(h) Upon Cash Settlement of any Purchase Contract:
(i) the Collateral Agent will in accordance with the terms of the
Pledge Agreement cause the Pledged Notes underlying the relevant
Corporate Units to be released from the Pledge, free and clear of any
security interest of the Company, and transferred to the Purchase
Contract Agent for delivery to the Holder thereof or its designee as soon
as practicable; and
(ii) subject to the receipt thereof, the Purchase Contract Agent
shall, by book-entry transfer or other appropriate procedures, in
accordance with written instructions provided by the Holder thereof,
transfer such Notes or, if no such instructions are given to the Purchase
Contract Agent by the Holder, the Purchase Contract Agent shall hold such
Notes, and any interest payment thereon, in the name of the Purchase
Contract Agent or its nominee in trust for the benefit of such Holder
until the expiration of the time period specified in the abandoned
property laws of the relevant state where such property is held).
(i) The obligations of the Holders to pay the Purchase Price are
non-recourse obligations and, except to the extent satisfied by Early
Settlement, Cash Merger Early Settlement or Cash Settlement, are payable
solely out of the proceeds of any Collateral pledged to secure the obligations
of the Holders, and in no event will Holders be liable for any deficiency
between the proceeds of the disposition of Collateral and the Purchase Price.
(j) The Company shall not be obligated to issue any shares of Ordinary
Shares in respect of a Purchase Contract or deliver any certificates thereof to
the Holder of the related
46
Units unless the Company shall have received payment for the Ordinary Shares to
be purchased thereunder in the manner herein set forth.
SECTION 5.03. Issuance of Shares of Ordinary Shares.
Unless a Termination Event, an Early Settlement or a Cash Merger Early
Settlement shall have occurred, subject to Section 5.04(b), on the Purchase
Contract Settlement Date upon receipt of the aggregate Purchase Price payable on
all Outstanding Units, the Company shall issue and deposit with the Purchase
Contract Agent, for the benefit of the Holders of the Outstanding Units, one or
more certificates representing newly issued shares of Ordinary Shares registered
in the name of the Purchase Contract Agent (or its nominee) as custodian for the
Holders (such certificates for shares of Ordinary Shares, together with any
dividends or distributions for which a record date and payment date for such
dividend or distribution has occurred after the Purchase Contract Settlement
Date, being hereinafter referred to as the "Purchase Contract Settlement Fund")
to which the Holders are entitled hereunder.
Subject to the foregoing, upon surrender of a Certificate to the Purchase
Contract Agent on or after the Purchase Contract Settlement Date, Early
Settlement Date or Cash Merger Early Settlement Date, as the case may be,
together with settlement instructions thereon duly completed and executed, the
Holder of such Certificate shall be entitled to receive forthwith in exchange
therefor a certificate representing that number of newly issued whole shares of
Ordinary Shares which such Holder is entitled to receive pursuant to the
provisions of this Article Five (after taking into account all Units then held
by such Holder), together with cash in lieu of fractional shares as provided in
Section 5.09 and any dividends or distributions with respect to such shares
constituting part of the Purchase Contract Settlement Fund, but without any
interest thereon, and the Certificate so surrendered shall forthwith be
cancelled. Such shares shall be registered in the name of the Holder or the
Holder's designee as specified in the settlement instructions provided by the
Holder to the Purchase Contract Agent. If any shares of Ordinary Shares issued
in respect of a Purchase Contract are to be registered to a Person other than
the Person in whose name the Certificate evidencing such Purchase Contract is
registered (but excluding any Depositary or nominee thereof), no such
registration shall be made unless the Person requesting such registration has
paid any transfer and other taxes required by reason of such registration in a
name other than that of the registered Holder of the Certificate evidencing such
Purchase Contract or has established to the satisfaction of the Company that
such tax either has been paid or is not payable.
SECTION 5.04. Adjustment of Settlement Rate.
(a) Adjustments for Dividends, Distributions, Share Splits, Etc.
(1) In case the Company shall pay or make a dividend or other
distribution on Ordinary Shares in Ordinary Shares, the Settlement Rate in
effect at the close of business on the date fixed for the determination of
shareholders entitled to receive such dividend or other distribution shall be
increased by dividing such Settlement Rate by a fraction of which:
(i) the numerator shall be the number of shares of Ordinary Shares
outstanding at the close of business on the date fixed for such
determination; and
47
(ii) the denominator shall be the sum of such number of shares and
the total number of shares constituting such dividend or other
distribution,
such increase to become effective immediately at the opening of business on the
day following the date fixed for such determination. For the purposes of this
paragraph (1), the number of shares of Ordinary Shares at any time outstanding
shall not include shares held in the treasury of the Company but shall include
any shares issuable in respect of any scrip certificates issued in lieu of
fractions of shares of Ordinary Shares. The Company agrees that it shall not pay
any dividend or make any distribution on shares of Ordinary Shares held in the
treasury of the Company.
(2) In case the Company shall issue rights, warrants or options, other
than pursuant to any dividend reinvestment plans or share purchase plans, to all
holders of its Ordinary Shares (not being available on an equivalent basis to
Holders of the Units upon settlement of the Purchase Contracts underlying such
Units) entitling them, for a period expiring within 45 days after the record
date for the determination of shareholders entitled to receive such rights,
warrants or options, to subscribe for or purchase shares of Ordinary Shares at a
price per share less than the Current Market Price per share of Ordinary Shares
on the date of announcement of such issuance, the Settlement Rate in effect at
the close of business on the date of such announcement shall be increased by
dividing such Settlement Rate by a fraction of which:
(i) the numerator shall be the number of shares of Ordinary Shares
outstanding at the close of business on the date of such announcement
plus the number of shares of Ordinary Shares which the aggregate of the
offering price of the total number of shares of Ordinary Shares so
offered for subscription or purchase would purchase at such Current
Market Price; and
(ii) the denominator shall be the number of shares of Ordinary
Shares outstanding at the close of business on the date of such
announcement plus the number of shares of Ordinary Shares so offered for
subscription or purchase,
such increase to become effective immediately after the opening of business on
the Business Day following the date of such announcement. The Company agrees
that it shall notify the Purchase Contract Agent if any issuance of such rights,
warrants or options is cancelled or not completed following the announcement
thereof and the Settlement Rate shall thereupon be readjusted to the Settlement
Rate in effect immediately prior to the date of such announcement. For the
purposes of this paragraph (2), the number of shares of Ordinary Shares at any
time outstanding shall not include shares held in the treasury of the Company
but shall include any shares issuable in respect of any scrip certificates
issued in lieu of fractions of shares of Ordinary Shares. The Company agrees
that it shall not issue any such rights, warrants or options in respect of
shares of Ordinary Shares held in the treasury of the Company.
(3) In case outstanding shares of Ordinary Shares shall be subdivided or
split into a greater number of shares of Ordinary Shares, the Settlement Rate in
effect at the close of business on the day preceding the day upon which such
subdivision or split becomes effective shall be proportionately increased, and,
conversely, in case outstanding shares of Ordinary Shares shall each be combined
into a smaller number of shares of Ordinary Shares, the
48
Settlement Rate in effect at the close of business on the day preceding the day
upon which such combination becomes effective shall be proportionately reduced,
such increase or reduction, as the case may be, to become effective immediately
at the opening of business on the day following the day upon which such
subdivision, split or combination becomes effective.
(4) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Ordinary Shares evidences of its indebtedness or assets
(including shares of Ordinary Shares securities, cash and property but excluding
any rights, warrants or options referred to in paragraph (2) of this Section
5.04(a), any dividend or distribution paid exclusively in cash and any dividend
or distribution referred to in paragraph (1) of this Section 5.04(a)), the
Settlement Rate in effect at the close of business on the date fixed for the
determination of shareholders entitled to receive such distribution shall be
adjusted by dividing such rate by a fraction of which:
(i) the numerator shall be the Current Market Price per share of
Ordinary Shares on the date fixed for such determination less the then
fair market value (as reasonably determined by the Board of Directors,
whose determination shall be conclusive and the basis for which shall be
described in a Board Resolution) of the portion of the assets or
evidences of indebtedness so distributed applicable to one share of
Ordinary Shares; and
(ii) the denominator shall be such Current Market Price per share
of Ordinary Shares,
such adjustment to become effective at the opening of business on the day
following the date fixed for the determination of shareholders entitled to
receive such distribution. In any case in which this paragraph (4) is
applicable, paragraph (2) of this Section 5.04(a) shall not be applicable. In
the event that such dividend or distribution is not so paid or made, the
Settlement Rate shall again be adjusted to be the Settlement Rate which would
then be in effect if such dividend or distribution had not been declared.
(5) In case the Company shall, by dividend or otherwise, distribute to
all holders of its Ordinary Shares cash (excluding any cash that is distributed
in a Reorganization Event to which Section 5.04(b) applies, as part of a
distribution referred to in paragraph (4) of this Section or as a regular
periodic cash dividend or distribution) in an aggregate amount that, combined
together with (I) the aggregate amount of any other distributions (other than
regular periodic cash dividends or distributions) to all holders of its Ordinary
Shares made exclusively in cash within the 12 months preceding the date of
payment of such distribution (the "Trailing 12 Month Period") and in respect of
which no adjustment pursuant to this paragraph (5) or paragraph (6) of this
Section has been made and (II) the aggregate amount of any cash plus the fair
market value (as determined by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution) of consideration (other than
consideration payable in respect of any odd-lot tender offer) payable in respect
of any tender or exchange offer by the Company or any of its subsidiaries and
calculated as of the expiration of such tender or exchange offer for all or any
portion of the Ordinary Shares concluded within the Trailing 12 Month Period and
in respect of which no adjustment pursuant to this paragraph (5) or paragraph
(6) of this Section has been made, exceeds 10% of the product of the Current
Market Price per share of the Ordinary Shares
49
on the date for the determination of holders of shares of Ordinary Shares
entitled to receive such distribution multiplied by the number of shares of
Ordinary Shares outstanding on such date, then, in such case, the Settlement
Rate in effect at the close of business on such record date shall be adjusted by
dividing such rate by a fraction of which:
(i) the numerator shall be the Current Market Price of Ordinary
Shares on such record date less the amount of cash so distributed (and
not excluded as provided above) applicable to one share of Ordinary
Shares; and
(ii) the denominator shall be the Current Market Price of Ordinary
Shares,
such increase to be effective at the opening of business on the day following
the record date; PROVIDED, HOWEVER, THAT in the event the portion of cash so
distributed applicable to one share of Ordinary Shares is equal to or greater
than the Current Market Price per share of Ordinary Shares on the record date,
in lieu of the foregoing adjustment, adequate provision shall be made so that
each holder of a Unit shall have the right to receive upon settlement of the
Units the amount of cash such Holder would have received had such Holder settled
each Unit on the record date. In the event that such dividend or distribution is
not so paid or made, the Settlement Rate shall again be adjusted to be the
Settlement Rate which would then be in effect if such dividend or distribution
had not been declared.
(6) If the Company or any subsidiary of the Company shall make a tender
or exchange offer (other than any odd-lot tender offer) for all or any portion
of the Ordinary Shares and upon expiration of such tender or exchange offer (as
amended upon the expiration thereof) the Company or its subsidiary shall be
required to pay to shareholders based on the acceptance (up to any maximum
specified in the terms of the tender or exchange offer) of Purchased Shares (as
herein defined) any consideration, then if the sum of (I) the fair market value
of the aggregate consideration to be paid in such tender offer or exchange offer
(as reasonably determined by the Board of Directors, whose determination shall
be conclusive and the basis for which shall be described in a Board Resolution)
plus (II) the aggregate of the cash plus the fair market value (as reasonably
determined by the Board of Directors, whose determination shall be conclusive
and the basis for which shall be described in a Board Resolution), as of the
expiration of such tender or exchange offer, of consideration payable in respect
of any other tender or exchange offer (other than consideration payable in
respect of any odd-lot tender offer), by the Company or any subsidiary of the
Company for all or any portion of Ordinary Shares expiring within the 12 months
preceding the expiration of such tender or exchange offer and in respect of
which no adjustment pursuant to this paragraph (6) has been made, plus (III) the
aggregate amount of any distributions (other than regular periodic cash
dividends or distributions) to all holders of Ordinary Shares made exclusively
in cash within the 12 months preceding the expiration of such tender or exchange
offer and in respect of which no adjustment pursuant to paragraph (5) has been
made, exceeds 10% of the product of the Current Market Price per share of
Ordinary Shares as of the last time (the "Expiration Time") tenders could have
been made pursuant to such tender or exchange offer (as it may be amended) times
the number of shares of Ordinary Shares outstanding (including any tendered
shares) on the Expiration Time, then, the Settlement Rate in effect at the close
of business on the day of the Expiration Time shall be adjusted by dividing it
by a fraction:
50
(i) the numerator of which shall be equal to (A) the product of
(I) the Current Market Price per share of Ordinary Shares on the date of
the Expiration Time and (II) the number of shares of Ordinary Shares
outstanding (including any tendered shares) on the date of the Expiration
Time less (B) the amount of cash plus the fair market value (determined
as aforesaid) of the aggregate consideration payable to shareholders
based on the transactions described in clauses (I), (II) and (III) above
(assuming in the case of clause (I) the acceptance, up to any maximum
specified in the terms of the tender or exchange offer, of Purchased
Shares); and
(ii) the denominator of which shall be equal to the product of (A)
the Current Market Price per share of Ordinary Shares as of the
Expiration Time and (B) the number of shares of Ordinary Shares
outstanding (including any tendered shares) as of the Expiration Time
less the number of all shares validly tendered and not withdrawn as of
the Expiration Time (the shares deemed so accepted, up to any such
maximum, being referred to as the "Purchased Shares"),
such adjustment to become effective at the opening of business on the date
following the date of the Expiration Time.
(7) The reclassification of Ordinary Shares into securities including
securities other than Ordinary Shares (other than any reclassification upon a
Reorganization Event to which Section 5.04(b) applies) shall be deemed to
involve:
(i) a distribution of such securities other than Ordinary Shares
to all holders of Ordinary Shares (and the effective date of such
reclassification shall be deemed to be "the date fixed for the
determination of shareholders entitled to receive such distribution" and
the "date fixed for such determination" within the meaning of paragraph
(4) of this Section); and
(ii) a subdivision, split or combination, as the case may be, of
the number of shares of Ordinary Shares outstanding immediately prior to
such reclassification into the number of shares of Ordinary Shares
outstanding immediately thereafter (and the effective date of such
reclassification shall be deemed to be "the day upon which such
subdivision or split becomes effective" or "the day upon which such
combination becomes effective", as the case may be, and "the day upon
which such subdivision, split or combination becomes effective" within
the meaning of paragraph (3) of this Section).
(8) The "Current Market Price" per share of Ordinary Shares on any date
of determination means the average of the daily Closing Prices for the five
consecutive Trading Days selected by the Company commencing not more than thirty
(30) Trading Days before and ending not later than the earlier of such date of
determination and the day before the "ex date" with respect to the issuance or
distribution requiring such computation. For purposes of this paragraph, the
term "ex date," when used with respect to any issuance or distribution, shall
mean the first date on which Ordinary Shares trades regularly on such exchange
or in such market without the right to receive such issuance or distribution.
51
(9) All adjustments to the Settlement Rate shall be calculated to the
nearest 1/10,000th of a share of Ordinary Shares (or if there is not a nearest
1/10,000th of a share, to the next lower 1/10,000th of a share). No adjustment
in the Settlement Rate shall be required unless such adjustment would require an
increase or decrease of at least one percent thereof; provided, however, that
any adjustments which by reason of this subparagraph are not required to be made
shall be carried forward and taken into account in any subsequent adjustment.
(10) The Company may, but shall not be required to, make such increases
in the Settlement Rate, in addition to those required by this Section, as the
Board of Directors considers to be advisable in order to avoid or diminish any
income tax to any holders of shares of Ordinary Shares resulting from any
dividend or distribution of shares or issuance of rights or warrants to purchase
or subscribe for shares or from any event treated as such for income tax
purposes or for any other reason.
(11) The Company has entered into a Rights Agreement dated as of ______
(the "Rights Agreement") with ______ pursuant to which share purchase rights
(the "Rights") have been, and may in the future be, issued in respect of shares
of Ordinary Shares. Each share of Ordinary Shares issued upon settlement of any
Purchase Contract pursuant to this Article 5 shall be entitled to receive the
appropriate number of Rights, if any, and the certificates representing the
Ordinary Shares issued upon such settlement shall bear such legends, if any, in
each case as provided by and subject to the terms of the Rights Agreement as in
effect at the time of such settlement. If after the date of this Agreement the
Rights separate from the Ordinary Shares in accordance with the provisions of
the Rights Agreement so that a Holder would not be entitled to receive any
Rights in respect of the Ordinary Shares issuable upon settlement of such
Purchase Contract, the Settlement Rate will be adjusted as provided in this
Section 5.04 on the separation date, subject to readjustment in the event of the
expiration, termination or redemption of the Rights. In lieu of any such
adjustment, the Company may amend the Rights Agreement to provide that upon
settlement Holders will receive, in addition to the Ordinary Shares issuable
upon such settlement, the Rights that would have attached to such shares of
Ordinary Shares if the Rights had not become separated from the Ordinary Shares
pursuant to the provisions of the Rights Agreement. If the Company hereafter
adopts any shareholder rights plan similar to the Rights Agreement, a Holder
shall be entitled to receive upon settlement of its Purchase Contracts in
addition to the shares of Ordinary Shares issuable upon settlement the related
rights for the Ordinary Shares, whether or not the rights under the future
shareholder rights plan have separated from the Ordinary Shares at the time of
settlement, but otherwise subject to the generally applicable terms of such
plan, and no additional adjustment to the Settlement Rate shall be made for the
future shareholder rights plan under this Section 5.04.
(b) Adjustment for Consolidation, Merger or Other Reorganization Event.
(1) In the event of:
(i) any consolidation or merger of the Company with or into
another Person (other than a merger or consolidation in which the Company
is the continuing corporation and in which the shares of Ordinary Shares
outstanding immediately prior to the merger or consolidation are not
exchanged for cash, securities or other property of the Company or
another corporation);
52
(ii) any sale, transfer, lease or conveyance to another Person of
the property of the Company as an entirety or substantially as an
entirety;
(iii) any statutory share exchange of the Company with another
Person (other than in connection with a merger or acquisition); or
(iv) any liquidation, dissolution or termination of the Company
other than as a result of or after the occurrence of a Termination Event
(any event described in clauses (i), (ii), (iii) and (iv), a
"Reorganization Event"),
each Purchase Contract shall become, without the consent of the Holder of the
Unit representing such Purchase Contract, an agreement to purchase only the kind
of securities, cash and other property receivable upon consummation of such
Reorganization Event by a holder of Ordinary Shares immediately prior to the
closing date of such Reorganization Event.
The amount of such securities, cash and other property receivable upon
settlement of each such Purchase Contract after the consummation of the
Reorganization Event shall be based on the value as of such settlement date of
the hypothetical amount of securities, cash and other property that would have
been received upon consummation of the Reorganization Event in exchange for the
maximum number of shares of Ordinary Shares deliverable under a Purchase
Contract immediately prior to the closing date of the Reorganization Event
(collectively, the "Exchange Property"). In determining the kind and amount of
the Exchange Property pursuant to the foregoing, it will be assumed that such
holder of Ordinary Shares is not a Person with which the Company consolidated or
into which the Company merged or which merged into the Company or to which such
sale or transfer was made, as the case may be (any such Person, a "Constituent
Person"), or an Affiliate of a Constituent Person to the extent such
Reorganization Event provides for different treatment of Ordinary Shares held by
Affiliates of the Company and non-affiliates and such Holder failed to exercise
its rights of election, if any, as to the kind or amount of securities, cash and
other property receivable upon such Reorganization Event (provided that if the
kind or amount of securities, cash and other property receivable upon such
Reorganization Event is not the same for each share of Ordinary Shares held
immediately prior to such Reorganization Event by other than a Constituent
Person or an Affiliate thereof and in respect of which such rights of election
shall not have been exercised ("Non-Electing Share"), then for the purpose of
this Section the kind and amount of securities, cash and other property
receivable upon such Reorganization Event by each non-electing share shall be
deemed to be the kind and amount so receivable per share by a plurality of the
non-electing shares).
The actual amount of Exchange Property receivable upon settlement of each
Purchase Contract shall be (1) in the case of settlement on the Purchase
Contract Settlement Date or pursuant to Section 5.04(b)(2), a variable amount
based upon the applicable Settlement Rate and the Adjusted Applicable Market
Value of the Exchange Property at such time and (2) in the case of any Early
Settlement, determined in accordance with the procedures described under Section
5.07 using the Settlement Rate that results in the minimum amount of Exchange
Property being delivered under such Purchase Contract.
For purposes of this Section 5.04(b)(1) and Section 5.04(b)(2), the term
"Adjusted Applicable Market Value" shall be deemed to refer to the "Adjusted
Applicable Market Value"
53
of the Exchange Property, and such value shall be determined (A) with respect to
any publicly traded securities that compose all or part of the Exchange
Property, based on the Closing Price of such securities, (B) in the case of any
cash that composes all or part of the Exchange Property, based on the amount of
such cash and (C) in the case of any other property that composes all or part of
the Exchange Property, based on the value of such property, as determined by a
nationally recognized independent investment banking firm retained by the
Company for this purpose; provided that prior to the separation of the Rights or
any similar shareholder rights from the Ordinary Shares, such Rights or similar
shareholder rights shall be deemed to have no value. The term "Closing Price"
shall be deemed to refer to the closing sale price, last quoted bid price or
mid-point of the last bid and ask prices, as the case may be, of any publicly
traded securities that comprise all or part of the Exchange Property. The term
"Trading Day" shall be deemed to refer to any publicly traded securities that
comprise all or part of the Exchange Property.
In the event of such a Reorganization Event, the Person formed by such
consolidation, merger or exchange or the Person which acquires the assets of the
Company or, in the event of a liquidation, dissolution or termination of the
Company, the Company or a liquidating trust created in connection therewith,
shall execute and deliver to the Purchase Contract Agent an agreement
supplemental hereto providing that each Holder of an Outstanding Unit shall have
the rights provided by this Section 5.04(b). Such supplemental agreement shall
provide for adjustments which, for events subsequent to the effective date of
such supplemental agreement, shall be as nearly equivalent as may be practicable
to the adjustments provided for in this Section 5.04. The above provisions of
this Section 5.04 shall similarly apply to successive Reorganization Events.
(2) In the event of a consolidation or merger of the Company with or into
another Person or any merger of another Person into the Company (other than a
merger that does not result in any reclassification, conversion, exchange or
cancellation of outstanding shares of Ordinary Shares), in each case in which
______% or more of the total consideration paid to the Company's shareholders
consists of cash or cash equivalents (a "Cash Merger"), a Holder of a Unit may
settle ("Cash Merger Early Settlement") its Purchase Contract, upon the
conditions set forth below, at the Settlement Rate in effect immediately prior
to the closing of the Cash Merger; provided that (i) the Cash Merger Early
Settlement Date (as defined below) is no later than the fifth Business Day
immediately preceding the Purchase Contract Settlement Date and (ii) no Cash
Merger Early Settlement will be permitted pursuant to this Section 5.04(b)(2)
unless, at the time such Cash Merger Early Settlement is effected, there is an
effective Registration Statement with respect to any securities to be issued and
delivered in connection with such Cash Merger Early Settlement, if such a
Registration Statement is required (in the view of counsel, which need not be in
the form of a written opinion, for the Company) under the Securities Act. If
such a Registration Statement is so required, the Company covenants and agrees
to use commercially reasonable efforts to (A) have in effect a Registration
Statement covering any securities to be delivered in respect of the Purchase
Contracts being settled and (B) provide a Prospectus in connection therewith, in
each case in a form that may be used in connection with such Cash Merger Early
Settlement. If a Holder effects a Cash Merger Early Settlement of some or all of
its Purchase Contracts, such Holder shall be entitled to receive, on the Cash
Merger Early Settlement Date, the aggregate amount of any Deferred Contract
Adjustment Payments and any accrued and unpaid Contract Adjustment Payments
since the immediately preceding Payment Date with respect to such Purchase
Contracts. The Company shall pay such amount as a credit
54
against the amount otherwise payable by the Holders to effect such Cash Merger
Early Settlement.
Within five Business Days of the completion of a Cash Merger, the Company
shall provide written notice to Holders of Units of such completion of a Cash
Merger, which shall specify the deadline for submitting the notice to settle
early in cash pursuant to this Section 5.04(b)(2), the date on which such Cash
Merger Early Settlement shall occur (which date shall be at least five days but
not more than 20 days after the date of such written notice by the Company, but
which shall in no event be later than the fifth Business Day immediately
preceding the Purchase Contract Settlement Date) (the "Cash Merger Early
Settlement Date"), the applicable Settlement Rate and the amount (per share of
Ordinary Shares) of cash, securities and other consideration receivable by the
Holder, including the amount of Contract Adjustment Payments receivable, upon
settlement.
Corporate Units Holders and Treasury Units Holders may only effect Cash
Merger Early Settlement pursuant to this Section 5.04(b)(2) in integral
multiples of 40 Corporate Units or Treasury Units, as the case may be. If the
Treasury Portfolio has replaced the Notes as a component of the Corporate Units,
Corporate Units Holders may only effect Cash Merger Early Settlement pursuant to
this Section 5.04(b)(2) in multiples of 80,000 Corporate Units. Other than the
provisions relating to timing of notice and settlement, which shall be as set
forth above, the provisions of Section 5.01(a) shall apply with respect to a
Cash Merger Early Settlement pursuant to this Section 5.04(b)(2).
In order to exercise the right to effect Cash Merger Early Settlement
with respect to any Purchase Contracts, a Holder of the Certificate evidencing
Units shall deliver, no later than 5:00 p.m. (New York City time) on the third
Business Day immediately preceding the Cash Merger Early Settlement Date, such
Certificate to the Purchase Contract Agent at the Corporate Trust Office duly
endorsed for transfer to the Company or in blank with the form of Election to
Settle Early on the reverse thereof duly completed and accompanied by payment
(payable to the Company in immediately available funds) in an amount equal to
the product of (A) the Stated Amount times (B) the number of Purchase Contracts
with respect to which the Holder has elected to effect Cash Merger Early
Settlement, less the amount of any Contract Adjustment Payments (including, for
the avoidance of doubt, any accrued and unpaid Contract Adjustment Payments and
any Deferred Contract Adjustment Payments) payable to such Holder on the next
succeeding Payment Date as a result of such Cash Merger Early Settlement.
If a Holder properly effects an effective Cash Merger Early Settlement in
accordance with the provisions of this Section 5.04(b)(2), the Company will
deliver (or will cause the Collateral Agent to deliver) to the Holder on the
Cash Merger Early Settlement Date:
(i) the kind and amount of securities, cash and other property
receivable upon such Cash Merger by a Holder of the number of shares of
Ordinary Shares issuable on account of each Purchase Contract if the
Purchase Contract Settlement Date had occurred immediately prior to such
Cash Merger (based on the Settlement Rate in effect at such time),
assuming such Holder of Ordinary Shares is not a Constituent Person or an
Affiliate of a Constituent Person to the extent such Cash Merger provides
for different treatment of Ordinary Shares held by Affiliates of the
Company and non-affiliates and
55
such Holder failed to exercise its rights of election, if any, as to the
kind or amount of securities, cash and other property receivable upon
such Cash Merger (provided that if the kind or amount of securities, cash
and other property receivable upon such Cash Merger is not the same for
each non-electing share, then for the purpose of this Section 5.04(b)(2),
the kind and amount of securities, cash and other property receivable
upon such Cash Merger by each non-electing share shall be deemed to be
the kind and amount so receivable per share by a plurality of the
non-electing shares). For the avoidance of doubt, for the purposes of
determining the Adjusted Applicable Market Value (in connection with
determining the appropriate Settlement Rate to be applied in the
foregoing sentence), the date of the closing of the Cash Merger shall be
deemed to be the Purchase Contract Settlement Date;
(ii) the Notes, the Applicable Ownership Interests in the Treasury
Portfolio or Treasury Securities, as the case may be, related to the
Purchase Contracts with respect to which the Holder is effecting a Cash
Merger Early Settlement; and
(iii) if so required under the Securities Act, a Prospectus as
contemplated by this Section 5.04(b)(2).
(c) All calculations and determinations pursuant to this Section 5.04
shall be made by the Company or its agent and the Purchase Contract Agent shall
have no responsibility with respect thereto.
(d) The Corporate Units or the Treasury Units of the Holders who do not
elect Cash Merger Early Settlement in accordance with the foregoing will
continue to remain outstanding and be subject to settlement on the Purchase
Contract Settlement Date in accordance with the terms hereof.
SECTION 5.05. Notice of Adjustments and Certain Other Events.
(a) Whenever the Settlement Rate is adjusted as herein provided, the
Company shall within 10 Business Days following the occurrence of an event that
requires an adjustment to the Settlement Rate pursuant to Section 5.04 (or if
the Company is not aware of such occurrence, as soon as practicable after
becoming so aware):
(i) compute the adjusted Settlement Rate in accordance with
Section 5.04 and prepare and transmit to the Purchase Contract Agent an
Officers' Certificate setting forth the Settlement Rate, the method of
calculation thereof in reasonable detail, and the facts requiring such
adjustment and upon which such adjustment is based; and
(ii) provide a written notice to the Holders of the Units of the
occurrence of such event and a statement in reasonable detail setting
forth the method by which the adjustment to the Settlement Rate was
determined and setting forth the adjusted Settlement Rate.
(b) The Purchase Contract Agent shall not at any time be under any duty
or responsibility to any Holder of Units to determine whether any facts exist
which may require any adjustment of the Settlement Rate, or with respect to the
nature or extent or calculation of any
56
such adjustment when made, or with respect to the method employed in making the
same. The Purchase Contract Agent shall be fully authorized and protected in
relying on any Officers' Certificate delivered pursuant to Section 5.05(a)(i)
and any adjustment contained therein and the Purchase Contract Agent shall not
be deemed to have knowledge of any adjustment unless and until it has received
such certificate. The Purchase Contract Agent shall not be accountable with
respect to the validity or value (or the kind or amount) of any shares of
Ordinary Shares, or of any securities or property, which may at the time be
issued or delivered with respect to any Purchase Contract; and the Purchase
Contract Agent makes no representation with respect thereto. The Purchase
Contract Agent shall not be responsible for any failure of the Company to issue,
transfer or deliver any shares of Ordinary Shares pursuant to a Purchase
Contract or to comply with any of the duties, responsibilities or covenants of
the Company contained in this Article.
SECTION 5.06. Termination Event; Notice.
The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Contract Adjustment
Payments (including any accrued and unpaid Contract Adjustment Payments and any
Deferred Contract Adjustment Payments), if the Company shall have such
obligation, and the rights and obligations of Holders to purchase Ordinary
Shares, shall immediately and automatically terminate, without the necessity of
any notice or action by any Holder, the Purchase Contract Agent or the Company,
if, prior to or on the Purchase Contract Settlement Date, a Termination Event
shall have occurred.
Upon and after the occurrence of a Termination Event, the Units shall
thereafter represent the right to receive the Notes, the Treasury Securities or
the appropriate Applicable Ownership Interests in the Treasury Portfolio, as the
case may be, forming part of such Units, in accordance with the provisions of
Section 5.04 of the Pledge Agreement. Upon the occurrence of a Termination
Event, the Company shall promptly but in no event later than two Business Days
thereafter give written notice to the Purchase Contract Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Security
Register.
57
SECTION 5.07. Early Settlement. (a) Subject to and upon compliance with
the provisions of this Section 5.07, at the option of the Holder thereof,
Purchase Contracts underlying Units may be settled early ("Early Settlement") at
any time prior to 5:00 p.m. (New York City time) on the fifth Business Day
immediately preceding the Purchase Contract Settlement Date; provided that no
Early Settlement will be permitted pursuant to this Section 5.07 unless, at the
time such Early Settlement is effected, there is an effective Registration
Statement with respect to any securities to be issued and delivered in
connection with such Early Settlement, if such a Registration Statement is
required (in the view of counsel, which need not be in the form of a written
opinion, for the Company) under the Securities Act. If such a Registration
Statement is so required, the Company covenants and agrees to use commercially
reasonable efforts to (A) have in effect a Registration Statement covering any
securities to be delivered in respect of the Purchase Contracts being settled
and (B) provide a Prospectus in connection therewith, in each case in a form
that may be used in connection with such Early Settlement.
(b) In order to exercise the right to effect Early Settlement with
respect to any Purchase Contracts, the Holder of the Certificate evidencing
Units shall deliver, at any time prior to 5:00 a.m. (New York City time) on the
fifth Business Day immediately preceding the Purchase Contract Settlement Date,
such Certificate to the Purchase Contract Agent at the Corporate Trust Office
duly endorsed for transfer to the Company or in blank with the form of Election
to Settle Early on the reverse thereof duly completed and accompanied by payment
(payable to the Company in immediately available funds) in an amount (the "Early
Settlement Amount") equal to:
(i) the sum of (A) the product of (I) the Stated Amount times (II)
the number of Purchase Contracts with respect to which the Holder has
elected to effect Early Settlement, plus (B) if such delivery is made
with respect to any Purchase Contracts during the period from the close
of business on any Record Date next preceding any Payment Date to the
opening of business on such Payment Date, an amount equal to the Contract
Adjustment Payments (including any Deferred Contract Adjustment Payments)
payable on such Payment Date with respect to such Purchase Contracts,
less
(ii) the amount of any Deferred Contract Adjustment Payments
payable to such Holder as a result of such Early Settlement.
Except as contemplated in the immediately preceding sentence, no payment
shall be made upon Early Settlement of any Purchase Contract on account of any
Contract Adjustment Payments accrued on such Purchase Contract since the
immediately preceding Payment Date or on account of any dividends on the
Ordinary Shares issued upon such Early Settlement. However, a Holder effecting
an Early Settlement of some or all of its Purchase Contracts shall be entitled
to receive, on the date it receives the shares of Ordinary Shares referred to in
Section 5.07(d), the amount of any Deferred Contract Adjustment Payments with
respect to such Purchase Contracts, calculated as of the immediately preceding
Payment Date. The amount of such Deferred Contract Adjustment Payments shall be
credited against the amount otherwise payable by the Holder to effect such Early
Settlement as set forth in clause (ii) above. If the foregoing requirements are
first satisfied with respect to Purchase Contracts underlying any Units at or
prior to 5:00 p.m. (New York City time) on a Business Day, such day shall be the
58
"Early Settlement Date" with respect to such Units and if such requirements are
first satisfied after 5:00 p.m. (New York City time) on a Business Day or on a
day that is not a Business Day, the "Early Settlement Date" with respect to such
Units shall be the next succeeding Business Day.
Upon the receipt of such Certificate and Early Settlement Amount from the
Holder, the Purchase Contract Agent shall pay to the Company such Early
Settlement Amount, the receipt of which payment the Company shall confirm in
writing. The Purchase Contract Agent shall then, in accordance with Section 5.06
of the Pledge Agreement, notify the Collateral Agent that (A) such Holder has
elected to effect an Early Settlement, which notice shall set forth the number
of such Purchase Contracts as to which such Holder has elected to effect Early
Settlement, (B) the Purchase Contract Agent has received from such Holder, and
paid to the Company as confirmed in writing by the Company, the related Early
Settlement Amount and (C) all conditions to such Early Settlement have been
satisfied.
Holders of Treasury Units may only effect Early Settlement pursuant to
this Section 5.07 in integral multiples of ______ Treasury Units. If the
Treasury Portfolio has replaced the Notes as a component of the Corporate Units,
Corporate Units Holders may only effect Early Settlement pursuant to this
Section 5.07 in integral multiples of ______ Corporate Units.
Upon Early Settlement of the Purchase Contracts, the rights of the
Holders to receive and the obligation of the Company to pay any accrued and
unpaid Contract Adjustment Payments since the immediately preceding Payment Date
and any future Contract Adjustment Payments with respect to such Purchase
Contracts shall immediately and automatically terminate.
(c) Upon Early Settlement of Purchase Contracts by a Holder of the
related Units, the Company shall issue, and the Holder shall be entitled to
receive, ______ shares of Ordinary Shares on account of each Purchase Contract
as to which Early Settlement is effected (the "Early Settlement Rate"). The
Early Settlement Rate shall be adjusted in the same manner and at the same time
as the Settlement Rate is adjusted pursuant to Section 5.04.
(d) No later than the third Business Day after the applicable Early
Settlement Date, the Company shall cause:
(i) the shares of Ordinary Shares issuable upon Early Settlement
of Purchase Contracts to be issued and delivered, together with payment
in lieu of any fraction of a share, as provided in Section 5.09; and
(ii) the related Notes or the Applicable Ownership Interests in
the Treasury Portfolio, as applicable, in the case of Corporate Units, or
the related Treasury Securities, in the case of Treasury Units, to be
released from the Pledge by the Collateral Agent and transferred, in each
case, to the Purchase Contract Agent for delivery to the Holder thereof
or its designee.
(e) Upon Early Settlement of any Purchase Contracts, and subject to
receipt of shares of Ordinary Shares from the Company and the Notes, the
Applicable Ownership Interests in the Treasury Portfolio or Treasury Securities,
as the case may be, from the Securities Intermediary, as applicable, the
Purchase Contract Agent shall, in accordance with the instructions provided by
59
the Holder thereof on the applicable form of Election to Settle Early on the
reverse of the Certificate evidencing the related Units:
(i) transfer to the Holder the Notes, the Applicable Ownership
Interests in the Treasury Portfolio or Treasury Securities, as the case
may be, forming a part of such Units,
(ii) deliver to the Holder a certificate or certificates for the
full number of shares of Ordinary Shares issuable upon such Early
Settlement, together with payment in lieu of any fraction of a share, as
provided in Section 5.09, and
(iii) if so required under the Securities Act, deliver a
Prospectus for the shares of Ordinary Shares issuable upon such Early
Settlement as contemplated by Section 5.07(a).
(f) In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Units evidenced by a
Certificate, upon such Early Settlement the Company shall execute and the
Purchase Contract Agent shall execute on behalf of the Holder, authenticate and
deliver to the Holder thereof, at the expense of the Company, a Certificate
evidencing the Units as to which Early Settlement was not effected.
(g) A Holder of a Unit who effects Early Settlement may elect to have the
Notes no longer a part of a Corporate Unit remarketed in accordance with the
provisions of Section 5.02.
SECTION 5.08. No Fractional Shares.
No fractional shares or scrip representing fractional shares of Ordinary
Shares shall be issued or delivered upon settlement on the Purchase Contract
Settlement Date, or upon Early Settlement or Cash Merger Early Settlement of any
Purchase Contracts. If Certificates evidencing more than one Purchase Contract
shall be surrendered for settlement at one time by the same Holder, the number
of full shares of Ordinary Shares which shall be delivered upon settlement shall
be computed on the basis of the aggregate number of Purchase Contracts evidenced
by the Certificates so surrendered. Instead of any fractional share of Ordinary
Shares which would otherwise be deliverable upon settlement of any Purchase
Contracts on the Purchase Contract Settlement Date, or upon Early Settlement or
Cash Merger Early Settlement, the Company, through the Purchase Contract Agent,
shall make a cash payment in respect of such fractional interest in an amount
equal to the percentage of such fractional share times the Applicable Market
Value calculated as if the date of such settlement were the Purchase Contract
Settlement Date. The Company shall provide the Purchase Contract Agent from time
to time with sufficient funds to permit the Purchase Contract Agent to make all
cash payments required by this Section 5.09 in a timely manner.
SECTION 5.09. Charges and Taxes.
The Company will pay all share transfer and similar taxes attributable to
the initial issuance and delivery of the shares of Ordinary Shares pursuant to
the Purchase Contracts; PROVIDED, HOWEVER, that the Company shall not be
required to pay any such tax or taxes which may be payable in respect of any
exchange of or substitution for a Certificate evidencing a Unit
60
or any issuance of a share of Ordinary Shares in a name other than that of the
registered Holder of a Certificate surrendered in respect of the Units evidenced
thereby, other than in the name of the Purchase Contract Agent, as custodian for
such Holder, and the Company shall not be required to issue or deliver such
share certificates or Certificates unless or until the Person or Persons
requesting the transfer or issuance thereof shall have paid to the Company the
amount of such tax or shall have established to the satisfaction of the Company
that such tax has been paid.
SECTION 5.10. Contract Adjustment Payments.
(a) Subject to Section 5.10(d), the Company shall pay, on each Payment
Date, the Contract Adjustment Payments payable in respect of each Purchase
Contract to the Person in whose name a Certificate is registered at the close of
business on the Record Date relating to such Payment Date. The Contract
Adjustment Payments will be payable at the office of the Purchase Contract Agent
in the Borough of Manhattan, New York City maintained for that purpose. If the
book-entry system for the Units has been terminated, the Contract Adjustment
Payments will be payable, at the option of the Company, by check mailed to the
address of the Person entitled thereto at such Person's address as it appears on
the Security Register, or by wire transfer to the account designated by such
Person by a prior written notice to the Purchase Contract Agent. If any date on
which Contract Adjustment Payments are to be made is not a Business Day, then
payment of the Contract Adjustment Payments payable on such date will be made on
the next succeeding day that is a Business Day (and without any interest in
respect of any such delay); PROVIDED THAT if such Business Day is in the next
succeeding calendar year, then payment of the Contract Adjustment Payments will
be made on the Business Day immediately preceding such Business Day. Contract
Adjustment Payments payable for any period will be computed on the basis of a
360-day year of twelve 30-day months. The Contract Adjustment Payments will
accrue from ______, 200__.
(b) Upon the occurrence of a Termination Event, the Company's obligation
to pay future Contract Adjustment Payments (including any accrued Contract
Adjustment Payments and any Deferred Contract Adjustment Payments) shall cease.
(c) Each Certificate delivered under this Agreement upon registration of
transfer of or in exchange for or in lieu of (including as a result of a
Collateral Substitution or the recreation of Corporate Units) any other
Certificate shall carry the right to accrued and unpaid Contract Adjustment
Payments and Deferred Contract Adjustment Payments, which right was carried by
the Purchase Contracts underlying such other Certificates.
(d) In the case of any Unit with respect to which Early Settlement or
Cash Merger Early Settlement of the underlying Purchase Contract is effected on
a date that is after any Record Date and prior to or on the next succeeding
Payment Date, Contract Adjustment Payments otherwise payable on such Payment
Date shall be payable on such Payment Date notwithstanding such Early Settlement
or Cash Merger Early Settlement, and such Contract Adjustment Payments shall be
paid to the Person in whose name the Certificate evidencing such Unit is
registered at the close of business on such Record Date. Except as otherwise
expressly provided in the immediately preceding sentence, in the case of any
Unit with respect to which Early Settlement or Cash Merger Early Settlement of
the underlying Purchase Contract is effected, future Contract Adjustment
Payments that would otherwise be payable after the Early
61
Settlement Date or Cash Merger Early Settlement Date with respect to such
Purchase Contract shall not be payable.
(e) The Company's obligations with respect to Contract Adjustment
Payments, if any, will be subordinated and junior in right of payment to the
Company's obligations under any Senior Indebtedness.
(f) In the event (x) of any payment by, or distribution of assets of, the
Company of any kind or character, whether in cash, property or securities, to
creditors upon any dissolution, winding-up, liquidation or reorganization of the
Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, or (y) subject to the provisions of Section
5.10(h) below, that (i) a default shall have occurred and be continuing with
respect to the payment of principal, interest or any other monetary amounts due
and payable on any Senior Indebtedness and such default shall have continued
beyond the period of grace, if any, specified in the instrument evidencing such
Senior Indebtedness (and the Purchase Contract Agent shall have received written
notice thereof from the Company or one or more holders of Senior Indebtedness or
their representative or representatives or the trustee or trustees under any
indenture pursuant to which any such Senior Indebtedness may have been issued),
or (ii) the maturity of any Senior Indebtedness shall have been accelerated
because of a default in respect of such Senior Indebtedness (and the Purchase
Contract Agent shall have received written notice thereof from the Company or
one or more holders of Senior Indebtedness or their representative or
representatives or the trustee or trustees under any indenture pursuant to which
any such Senior Indebtedness may have been issued), then:
(i) the holders of all Senior Indebtedness shall first be entitled
to receive, in the case of clause (x) above, payment of all amounts due
or to become due upon all Senior Indebtedness and, in the case of
subclauses (i) and (ii) of clause (y) above, payment of all amounts due
thereon, or provision shall be made for such payment in money or money's
worth, before the Holders of any of the Units are entitled to receive any
Contract Adjustment Payments on the Purchase Contracts underlying the
Units;
(ii) any payment by, or distribution of assets of, the Company of
any kind or character, whether in cash, property or securities, to which
the Holders of any of the Units would be entitled except for the
provisions of Section 5.10(e) through (q), including any such payment or
distribution which may be payable or deliverable by reason of the payment
of any other indebtedness of the Company being subordinated to the
payment of such Contract Adjustment Payments on the Purchase Contracts
underlying the Units, shall be paid or delivered by the Person making
such payment or distribution, whether a trustee in bankruptcy, a receiver
or liquidating trustee or otherwise, directly to the representative or
representatives of the holders of Senior Indebtedness or to the trustee
or trustees under any indenture under which any instruments evidencing
any of such Senior Indebtedness may have been issued, ratably according
to the aggregate amounts remaining unpaid on account of such Senior
Indebtedness held or represented by each, to the extent necessary to make
payment in full of all Senior Indebtedness remaining unpaid after giving
effect to any concurrent payment or distribution (or provision therefor)
to the holders of such Senior
62
Indebtedness, before any payment or distribution is made of such Contract
Adjustment Payments to the Holders of such Units; and
(iii) in the event that, notwithstanding the foregoing, any
payment by, or distribution of assets of, the Company of any kind or
character, whether in cash, property or securities, including any such
payment or distribution which may be payable or deliverable by reason of
the payment of any other indebtedness of the Company being subordinated
to the payment of Contract Adjustment Payments on the Purchase Contracts
underlying the Units, shall be received by the Purchase Contract Agent or
the Holders of any of the Units when such payment or distribution is
prohibited pursuant to Section 5.10(e) through (q), such payment or
distribution shall be paid over to the representative or representatives
of the holders of Senior Indebtedness or to the trustee or trustees under
any indenture pursuant to which any instruments evidencing any such
Senior Indebtedness may have been issued, ratably as aforesaid, for
application to the payment of all Senior Indebtedness remaining unpaid
until all such Senior Indebtedness shall have been paid in full, after
giving effect to any concurrent payment or distribution (or provision
therefor) to the holders of such Senior Indebtedness.
(g) For purposes of Section 5.10(e) through (q), the words "cash,
property or securities" shall not be deemed to include shares of the Company as
reorganized or readjusted, or securities of the Company or any other Person
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in Section 5.10(e) through (q)
with respect to such Contract Adjustment Payments on the Units to the payment of
all Senior Indebtedness which may at the time be outstanding; provided that (i)
the indebtedness or guarantee of indebtedness, as the case may be, that
constitutes Senior Indebtedness is assumed by the Person, if any, resulting from
any such reorganization or readjustment, and (ii) the rights of the holders of
the Senior Indebtedness are not, without the consent of each such holder
adversely affected thereby, altered by such reorganization or readjustment;
(h) Any failure by the Company to make any payment on or perform any
other obligation under Senior Indebtedness, other than any indebtedness incurred
by the Company or assumed or guaranteed, directly or indirectly, by the Company
for money borrowed (or any deferral, renewal, extension or refunding thereof) or
any indebtedness or obligation as to which the provisions of Section 5.10(e)
through (g) shall have been waived by the Company in the instrument or
instruments by which the Company incurred, assumed, guaranteed or otherwise
created such indebtedness or obligation, shall not be deemed a default or event
of default if (i) the Company shall be disputing its obligation to make such
payment or perform such obligation and (ii) either (A) no final judgment
relating to such dispute shall have been issued against the Company which is in
full force and effect and is not subject to further review, including a judgment
that has become final by reason of the expiration of the time within which a
party may seek further appeal or review, and (B) in the event a judgment that is
subject to further review or appeal has been issued, the Company shall in good
faith be prosecuting an appeal or other proceeding for review and a stay of
execution shall have been obtained pending such appeal or review.
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(i) Subject to the irrevocable payment in full of all Senior
Indebtedness, the Holders of the Units shall be subrogated (equally and ratably
with the holders of all obligations of the Company which by their express terms
are subordinated to Senior Indebtedness of the Company to the same extent as
payment of the Contract Adjustment Payments in respect of the Purchase Contracts
underlying the Units is subordinated and which are entitled to like rights of
subrogation) to the rights of the holders of Senior Indebtedness to receive
payments or distributions of cash, property or securities of the Company
applicable to the Senior Indebtedness until all such Contract Adjustment
Payments owing on the Units shall be paid in full, and as between the Company,
its creditors other than holders of such Senior Indebtedness and the Holders, no
such payment or distribution made to the holders of Senior Indebtedness by
virtue of Section 5.10(e) through (q) that otherwise would have been made to the
Holders shall be deemed to be a payment by the Company on account of such Senior
Indebtedness, it being understood that the provisions of Section 5.10(e) through
(q) are and are intended solely for the purpose of defining the relative rights
of the Holders, on the one hand, and the holders of Senior Indebtedness, on the
other hand.
(j) Nothing contained in Section 5.10(e) through (q) or elsewhere in this
Agreement or in the Units is intended to or shall impair, as among the Company,
its creditors other than the holders of Senior Indebtedness and the Holders, the
obligation of the Company, which is absolute and unconditional, to pay to the
Holders such Contract Adjustment Payments on the Units as and when the same
shall become due and payable in accordance with their terms, or is intended to
or shall affect the relative rights of the Holders and creditors of the Company
other than the holders of Senior Indebtedness, nor shall anything herein or
therein prevent the Purchase Contract Agent or any Holder from exercising all
remedies otherwise permitted by applicable law upon default under this
Agreement, subject to the rights, if any, under Section 5.10(e) through (q), of
the holders of Senior Indebtedness in respect of cash, property or securities of
the Company received upon the exercise of any such remedy.
(k) Upon payment or distribution of assets of the Company referred to in
Section 5.10(e) through (q), the Purchase Contract Agent and the Holders shall
be entitled to rely upon any order or decree made by any court of competent
jurisdiction in which any such dissolution, winding up, liquidation or
reorganization proceeding affecting the affairs of the Company is pending or
upon a certificate of the trustee in bankruptcy, receiver, assignee for the
benefit of creditors, liquidating trustee or Purchase Contract Agent or other
person making any payment or distribution, delivered to the Purchase Contract
Agent or to the Holders, for the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to these Section 5.10(e) through (q).
(l) The Purchase Contract Agent shall be conclusively entitled to rely on
the delivery to it of a written notice by a Person representing himself to be a
holder of Senior Indebtedness (or a trustee or representative on behalf of such
holder) to establish that such notice has been given by a holder of Senior
Indebtedness or a trustee or representative on behalf of any such holder or
holders. In the event that the Purchase Contract Agent determines in good faith
that further evidence is required with respect to the right of any Person as a
holder of Senior Indebtedness to participate in any payment or distribution
pursuant to Section 5.10(e) through
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(q), the Purchase Contract Agent may request such Person to furnish evidence to
the reasonable satisfaction of the Purchase Contract Agent as to the amount of
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under Section 5.10(e) through (q), and,
if such evidence is not furnished, the Purchase Contract Agent may defer payment
to such Person pending judicial determination as to the right of such Person to
receive such payment.
(m) Nothing contained in Section 5.10(e) through (q) shall affect the
obligations of the Company to make, or prevent the Company from making, payment
of the Contract Adjustment Payments, except as otherwise provided in these
Section 5.10(e) through (q).
(n) Each Holder of Units, by its acceptance thereof, authorizes and
directs the Purchase Contract Agent on its behalf to take such action as may be
necessary or appropriate to effectuate the subordination provided in Section
5.10(e) through (q) and appoints the Purchase Contract Agent its
attorney-in-fact, as the case may be, for any and all such purposes.
(o) The Company shall give prompt written notice to the Purchase Contract
Agent of any fact known to the Company that would prohibit the making of any
payment of moneys to or by the Purchase Contract Agent in respect of the Units
pursuant to the provisions of this Section. Notwithstanding the provisions of
Section 5.10(e) through (q) or any other provisions of this Agreement, the
Purchase Contract Agent shall not be charged with knowledge of the existence of
any facts that would prohibit the making of any payment of moneys to or by the
Purchase Contract Agent, or the taking of any other action by the Purchase
Contract Agent, unless and until a Responsible Officer of the Purchase Contract
Agent shall have received written notice thereof mailed or delivered to the
Purchase Contract Agent at its Corporate Trust Office from the Company, any
Holder, or the holder or representative of any Senior Indebtedness; PROVIDED
THAT if at least two Business Days prior to the date upon which by the terms
hereof any such moneys may become payable for any purpose, the Purchase Contract
Agent shall not have received with respect to such moneys the notice provided
for in this Section, then, anything herein contained to the contrary
notwithstanding, the Purchase Contract Agent shall have full power and authority
to receive such moneys and to apply the same to the purpose for which they were
received and shall not be affected by any notice to the contrary that may be
received by it within two Business Days prior to or on or after such date.
(p) The Purchase Contract Agent in its individual capacity shall be
entitled to all the rights set forth in this Section with respect to any Senior
Indebtedness at the time held by it, to the same extent as any other holder of
Senior Indebtedness and nothing in this Agreement shall deprive the Purchase
Contract Agent of any of its rights as such holder.
(q) No right of any present or future holder of any Senior Indebtedness
to enforce the subordination herein shall at any time or in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any noncompliance by the Company with the terms, provisions and covenants
of this Agreement, regardless of any knowledge thereof which any such holder may
have or be otherwise charged with.
(r) Nothing in this Section 5.10 shall apply to claims of, or payments
to, the Purchase Contract Agent under or pursuant to Section 7.07.
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(s) With respect to the holders of Senior Indebtedness, (i) the duties
and obligations of the Purchase Contract Agent shall be determined solely by the
express provisions of this Agreement; (ii) the Purchase Contract Agent shall not
be liable to any such holders if it shall, acting in good faith, mistakenly pay
over or distribute to the Holders or to the Company or any other Person cash,
property or securities to which any holders of Senior Indebtedness shall be
entitled by virtue of this Section 5.10 or otherwise; (iii) no implied covenants
or obligations shall be read into this Agreement against the Purchase Contract
Agent; and (iv) the Purchase Contract Agent shall not be deemed to be a
fiduciary as to such holders.
SECTION 5.11. Deferral of Contract Adjustment Payments. (a) The Company
has the right at any time, and from time to time, to defer payment of all or
part of the Contract Adjustment Payments in respect of each Purchase Contract by
extending the period for payment of Contract Adjustment Payments to any
subsequent Payment Date (an "Extension Period"), but not beyond the Purchase
Contract Settlement Date (or, with respect to Purchase Contracts for which an
effective Early Settlement or Cash Merger Early Settlement has occurred, the
Early Settlement Date or Cash Merger Early Settlement Date, as the case may be).
Prior to the expiration of any Extension Period, the Company may further extend
such Extension Period to any subsequent Payment Date, but not beyond the
Purchase Contract Settlement Date (or any applicable Early Settlement Date or
Cash Merger Early Settlement Date).
If the Company so elects to defer Contract Adjustment Payments, the
Company shall pay additional Contract Adjustment Payments on such deferred
installments of Contract Adjustment Payments at a rate equal to ______% per
annum, compounding on each succeeding Payment Date, until such deferred
installments are paid in full (such deferred installments of Contract Adjustment
Payments together with the accrued additional Contract Adjustment Payments
thereon, being referred to herein as the "Deferred Contract Adjustment
Payments").
At the end of each Extension Period, including as the same may be
extended as provided above, or, in the event of an effective Early Settlement or
Cash Merger Early Settlement, on the Early Settlement Date or Cash Merger Early
Settlement Date, as the case may be, the Company shall pay all Deferred Contract
Adjustment Payments then due in the manner set forth in Section 5.10(a) (in the
case of the end of an Extension Period), in the manner set forth in Section
5.07(b) (in the case of an Early Settlement) or in the manner set forth in
Section 5.04(b)(2) (in the case of a Cash Merger Early Settlement) to the extent
such amounts are not deducted from the amount otherwise payable by the Holder in
the case of a Cash Settlement, any Early Settlement or any Cash Merger Early
Settlement. In the event of an Early Settlement, the Company shall pay all
Deferred Contract Adjustment Payments due on the Purchase Contracts being
settled early through the Payment Date immediately preceding the applicable
Early Settlement Date. In the event of a Cash Merger Early Settlement, the
Company shall pay all Deferred Contract Adjustment Payments due on the Purchase
Contracts being settled on the Cash Merger Early Settlement Date to but
excluding such Cash Merger Early Settlement Date.
Upon termination of any Extension Period and the payment of all Deferred
Contract Adjustment Payments and all accrued and unpaid Contract Adjustment
Payments then due, the Company may commence a new Extension Period, provided
that such Extension Period, together with all extensions thereof, may not extend
beyond the Purchase Contract Settlement Date (or any applicable Early Settlement
Date or Cash Merger Early Settlement Date). Except in the case
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of an Early Settlement or Cash Merger Early Settlement, no Contract Adjustment
Payments shall be due and payable during an Extension Period except at the end
thereof, except that prior to the end of such Extension Period, the Company, at
its option, may prepay on any Payment Date all or any portion of the Deferred
Contract Adjustment Payments accrued during the then elapsed portion of such
Extension Period.
(b) The Company shall give written notice to the Purchase Contract Agent
(and the Purchase Contract Agent shall give notice thereof to Holders of
Purchase Contracts) of its election to extend any period for the payment of
Contract Adjustment Payments, the expected length of any such Extension Period
and any extension of any Extension Period, at least five Business Days before
the earlier of (i) the Record Date for the Payment Date on which Contract
Adjustment Payments would have been payable except for the election to begin or
extend the Extension Period or (ii) the date the Purchase Contract Agent is
required to give notice to any securities exchange or to Holders of Purchase
Contracts of such Record Date or such Payment Date.
(c) The Company shall give written notice to the Purchase Contract Agent
(and the Purchase Contract Agent shall give notice thereof to Holders of
Purchase Contracts) of the end of an Extension Period or its election to pay any
portion of the Deferred Contract Adjustment Payments on a payment date prior to
the end of an Extension Period, at least five Business Days before the earlier
of (i) the Record Date for the Payment Date on which such Extension Period shall
end or such payment of Deferred Contract Adjustment Payments shall be made or
(ii) the date the Purchase Contract Agent is required to give notice to any
securities exchange or to Holders of Purchase Contracts of such Record Date or
such Payment Date.
(d) In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, then, until all Deferred Contract Adjustment
Payments have been paid, the Company shall not, and shall not permit any of its
subsidiaries to, declare or pay dividends on, make distributions with respect
to, or redeem, purchase or acquire, or make a liquidation payment with respect
to, any of its share capital or their capital stock or share capital; PROVIDED
THAT the Company's subsidiaries will not be restricted from declaring or paying
such dividends, or making such distributions, to the Company or any of the
Company's other subsidiaries as a result of the foregoing.
ARTICLE VI
REMEDIES
SECTION 6.01. Unconditional Right of Holders to Receive Contract
Adjustment Payments and to Purchase Shares of Ordinary Shares.
Each Holder of a Unit shall have the right, which is absolute and
unconditional, (i) to receive each Contract Adjustment Payment with respect to
the Purchase Contract comprising part of such Unit on the respective Payment
Date for such Unit and (ii) except upon and following a Termination Event, to
purchase shares of Ordinary Shares pursuant to such Purchase Contract and, in
each such case, to institute suit for the enforcement of any such right to
receive
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Contract Adjustment Payments and the right to purchase shares of Ordinary
Shares, and such rights shall not be impaired without the consent of such
Holder.
SECTION 6.02. Restoration of Rights and Remedies.
If any Holder has instituted any proceeding to enforce any right or
remedy under this Agreement and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company and such Holder shall be restored severally and respectively to their
former positions hereunder, and thereafter all rights and remedies of such
Holder shall continue as though no such proceeding had been instituted.
SECTION 6.03. Rights and Remedies Cumulative.
Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Certificates in the last paragraph of
Section 3.10, no right or remedy herein conferred upon or reserved to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 6.04. Delay or Omission Not Waiver.
No delay or omission of any Holder to exercise any right upon a default
or remedy upon a default shall impair any such right or remedy or constitute a
waiver of any such right. Every right and remedy given by this Article or by law
to the Holders may be exercised from time to time, and as often as may be deemed
expedient, by such Holders.
SECTION 6.05. Undertaking for Costs.
All parties to this Agreement agree, and each Holder of a Unit, by its
acceptance of such Unit shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Agreement, or in any suit against the Purchase Contract Agent for any
action taken, suffered or omitted by it as Purchase Contract Agent, the filing
by any party litigant in such suit of an undertaking to pay the costs of such
suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees and costs against any party litigant in
such suit, having due regard to the merits and good faith of the claims or
defenses made by such party litigant; PROVIDED THAT the provisions of this
Section shall not apply to any suit instituted by the Purchase Contract Agent,
to any suit instituted by any Holder, or group of Holders, holding in the
aggregate more than 10% of the Outstanding Units, or to any suit instituted by
any Holder for the enforcement of interest on any Notes or Contract Adjustment
Payments on or after the respective Payment Date therefor in respect of any Unit
held by such Holder, or for enforcement of the right to purchase shares of
Ordinary Shares under the Purchase Contracts constituting part of any Unit held
by such Holder.
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SECTION 6.06. Waiver of Stay or Extension Laws.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Agreement; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Purchase Contract Agent or the Holders, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
ARTICLE VII
THE PURCHASE CONTRACT AGENT
SECTION 7.01. Certain Duties and Responsibilities.
(a) The Purchase Contract Agent:
(1) undertakes to perform, with respect to the Units, such duties and
only such duties as are specifically set forth in this Agreement, the Pledge
Agreement and the Remarketing Agreement and no implied covenants or obligations
shall be read into this Agreement, the Pledge Agreement or the Remarketing
Agreement against the Purchase Contract Agent; and
(2) in the absence of bad faith or gross negligence on its part, may,
with respect to the Units, conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Purchase Contract Agent and conforming to the
requirements of this Agreement or the Pledge Agreement or the Remarketing
Agreement, as applicable, but in the case of any certificates or opinions which
by any provision hereof are specifically required to be furnished to the
Purchase Contract Agent, the Purchase Contract Agent shall be under a duty to
examine the same to determine whether or not they conform to the requirements of
this Agreement, the Pledge Agreement or the Remarketing Agreement, as applicable
(but need not confirm or investigate the accuracy of the mathematical
calculations or other facts stated therein).
(b) No provision of this Agreement, the Pledge Agreement or the
Remarketing Agreement shall be construed to relieve the Purchase Contract Agent
from liability for its own grossly negligent action, its own grossly negligent
failure to act, or its own willful misconduct, except that:
(1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;
(2) the Purchase Contract Agent shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it shall be
conclusively determined by a court of competent jurisdiction that the Purchase
Contract Agent was grossly negligent in ascertaining the pertinent facts; and
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(3) no provision of this Agreement or the Pledge Agreement or the
Remarketing Agreement shall require the Purchase Contract Agent to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder, or in the exercise of any of its rights or
powers, if it shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably
assured to it.
(c) Whether or not therein expressly so provided, every provision of this
Agreement, the Pledge Agreement and the Remarketing Agreement relating to the
conduct or affecting the liability of or affording protection to the Purchase
Contract Agent shall be subject to the provisions of this Section.
(d) The Purchase Contract Agent is authorized to execute and deliver the
Pledge Agreement and the Remarketing Agreement in its capacity as Purchase
Contract Agent.
SECTION 7.02. Notice of Default.
Within ______ days after the occurrence of any default by the Company
hereunder of which a Responsible Officer of the Purchase Contract Agent has
actual knowledge, the Purchase Contract Agent shall transmit by mail to the
Company and the Holders of Units, as their names and addresses appear in the
Security Register, notice of such default hereunder, unless such default shall
have been cured or waived.
SECTION 7.03. Certain Rights of Purchase Contract Agent.
Subject to the provisions of Section 7.01:
(1) the Purchase Contract Agent may, in the absence of bad faith,
conclusively rely and shall be fully protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be genuine
and to have been signed or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officers' Certificate, Issuer Order or Issuer
Request, and any resolution of the Board of Directors of the Company may be
sufficiently evidenced by a Board Resolution;
(3) whenever in the administration of this Agreement or the Pledge
Agreement or the Remarketing Agreement the Purchase Contract Agent shall deem it
desirable that a matter be proved or established prior to taking, suffering or
omitting to take any action hereunder or thereunder, the Purchase Contract Agent
(unless other evidence be herein specifically prescribed in this Agreement) may,
in the absence of bad faith on its part, conclusively rely upon an Officers'
Certificate of the Company;
(4) the Purchase Contract Agent may consult with counsel of its selection
appointed with due care by it hereunder and the advice of such counsel or any
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in reliance thereon;
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(5) the Purchase Contract Agent shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Purchase Contract Agent, in its discretion, may make
reasonable further inquiry or investigation into such facts or matters related
to the execution, delivery and performance of the Purchase Contracts as it may
see fit, and, if the Purchase Contract Agent shall determine to make such
further inquiry or investigation, it shall be entitled to examine the relevant
books, records and premises of the Company, personally or by agent or attorney;
(6) the Purchase Contract Agent may execute any of the powers hereunder
or perform any duties hereunder either directly or by or through agents,
attorneys, custodians or nominees or an Affiliate of the Purchase Contract Agent
and the Purchase Contract Agent shall not be responsible for any misconduct or
negligence on the part of any agent, attorney, custodian or nominee or an
Affiliate of the Purchase Contract Agent appointed with due care by it
hereunder; provided that the appointment of agents pursuant to this paragraph
(6) are subject to the prior written consent of the Company, which consent shall
not be unreasonably withheld;
(7) the Purchase Contract Agent shall be under no obligation to exercise
any of the rights or powers vested in it by this Agreement at the request or
direction of any of the Holders pursuant to this Agreement, unless such Holders
shall have offered to the Purchase Contract Agent security or indemnity
satisfactory to the Purchase Contract Agent against the costs, expenses and
liabilities which might be incurred by it in compliance with such request or
direction;
(8) the Purchase Contract Agent shall not be liable for any action taken,
suffered, or omitted to be taken by it in the absence of bad faith or gross
negligence by it;
(9) the Purchase Contract Agent shall not be deemed to have notice of any
adjustment to the Settlement Rate, the occurrence of a Termination Event or any
default hereunder unless a Responsible Officer of the Purchase Contract Agent
has actual knowledge thereof or unless written notice of any event which is in
fact such a default is received by a Responsible Officer at the Corporate Trust
Office of the Purchase Contract Agent, and such notice references the Units and
this Agreement;
(10) the Purchase Contract Agent may request that the Company deliver an
Officers' Certificate setting forth the names of individuals and/or titles of
officers authorized at such time to take specified actions pursuant to this
Agreement, which Officers' Certificate may be signed by any person authorized to
sign an Officers' Certificate, including any person specified as so authorized
in any such certificate previously delivered and not superseded;
(11) the rights, privileges, protections, immunities and benefits given
to the Purchase Contract Agent, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Purchase Contract
Agent in each of its capacities hereunder, and to each officer, director,
employee of the Purchase Contract Agent and each agent, custodian and other
Person employed, in any capacity whatsoever, by the Purchase Contract Agent to
act hereunder and shall survive the resignation or removal of the Purchase
Contract Agent and the termination of this Agreement; and
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(12) The Purchase Contract Agent shall not be required to initiate or
conduct any litigation or collection proceedings hereunder and shall have no
responsibilities with respect to any default hereunder except as expressly set
forth herein.
SECTION 7.04. Not Responsible for Recitals or Issuance of Units.
The recitals contained herein, in the Pledge Agreement, the Remarketing
Agreement and in the Certificates shall be taken as the statements of the
Company, and the Purchase Contract Agent assumes no responsibility for their
accuracy or validity. The Purchase Contract Agent makes no representations as to
the validity or sufficiency of either this Agreement or of the Units, or of the
Pledge Agreement or the Pledge or the Collateral and shall have no
responsibility for perfecting or maintaining the perfection of any security
interest in the Collateral. The Purchase Contract Agent shall not be accountable
for the use or application by the Company of the proceeds in respect of the
Purchase Contracts.
SECTION 7.05. May Hold Units.
Any Security Registrar or any other agent of the Company, or the Purchase
Contract Agent and its Affiliates, in their individual or any other capacity,
may become the owner or pledgee of Units and may otherwise deal with the
Company, the Collateral Agent or any other Person with the same rights it would
have if it were not Security Registrar or such other agent, or the Purchase
Contract Agent. The Company may become the owner or pledgee of Units.
SECTION 7.06. Money Held in Custody.
Money held by the Purchase Contract Agent in custody hereunder need not
be segregated from the Purchase Contract Agent's other funds except to the
extent required by law or provided herein. The Purchase Contract Agent shall be
under no obligation to invest or pay interest on any money received by it
hereunder except as otherwise provided hereunder or agreed in writing with the
Company.
SECTION 7.07. Compensation and Reimbursement.
The Company agrees:
(1) to pay to the Purchase Contract Agent compensation for all services
rendered by it hereunder, under the Pledge Agreement and under the Remarketing
Agreement as the Company and the Purchase Contract Agent shall from time to time
agree in writing;
(2) except as otherwise expressly provided for herein, to reimburse the
Purchase Contract Agent upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Purchase Contract Agent in
accordance with any provision of this Agreement, the Pledge Agreement and the
Remarketing Agreement (including the reasonable compensation and the expenses
and disbursements of its agents and counsel) in connection with the negotiation,
preparation, execution and delivery and performance of this Agreement, the
Pledge Agreement and the Remarketing Agreement and any modification, supplement
or waiver of any of the terms thereof, except any such expense, disbursement or
advance as may be attributable to its gross negligence, willful misconduct or
bad faith; and
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(3) to indemnify and defend the Purchase Contract Agent and any
predecessor Purchase Contract Agent (and each of its directors, officers, agents
and employees, collectively, the "Indemnitees") for, and to hold each Indemnitee
harmless against, any loss, claim, damage, fine, penalty, liability or expense
(including reasonable fees and expenses of counsel) incurred without gross
negligence, willful misconduct or bad faith on its part, arising out of or in
connection with the acceptance or administration of its duties hereunder and
under the Pledge Agreement and the Remarketing Agreement, including the
Indemnitees' reasonable costs and expenses of defending themselves against any
claim (whether asserted by the Company, a Holder or any other person) or
liability in connection with the exercise or performance of any of the Purchase
Contract Agent's powers or duties hereunder or thereunder.
The provisions of this Section shall survive the resignation and removal
of the Purchase Contract Agent and the termination of this Agreement.
SECTION 7.08. Corporate Purchase Contract Agent Required; Eligibility.
There shall at all times be a Purchase Contract Agent hereunder which
shall be a Person organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under such laws to exercise corporate trust powers, having (or being a member of
a bank holding company having) a combined capital and surplus of at least
$______, subject to supervision or examination by Federal or State authority and
having corporate trust office in the Borough of Manhattan, New York City, if
there be such a Person in the Borough of Manhattan, New York City, qualified and
eligible under this Article and willing to act on reasonable terms. If such
Person publishes or files reports of condition at least annually, pursuant to
law or to the requirements of said supervising or examining authority, then for
the purposes of this Section, the combined capital and surplus of such Person
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published or filed. If at any time the Purchase
Contract Agent shall cease to be eligible in accordance with the provisions of
this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
SECTION 7.09. Resignation and Removal; Appointment of Successor.
(a) No resignation or removal of the Purchase Contract Agent and no
appointment of a successor Purchase Contract Agent pursuant to this Article
shall become effective until the acceptance of appointment by the successor
Purchase Contract Agent in accordance with the applicable requirements of
Section 7.10.
(b) The Purchase Contract Agent may resign at any time by giving written
notice thereof to the Company ______ days prior to the effective date of such
resignation. If the instrument of acceptance by a successor Purchase Contract
Agent required by Section 7.10 shall not have been delivered to the Purchase
Contract Agent within ______ days after the giving of such notice of
resignation, the resigning Purchase Contract Agent may petition, at the expense
of the Company, any court of competent jurisdiction for the appointment of a
successor Purchase Contract Agent.
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(c) The Purchase Contract Agent may be removed at any time by Act of the
Holders of a majority in number of the Outstanding Units delivered to the
Purchase Contract Agent and the Company. If the instrument of acceptance by a
successor Purchase Contract Agent required by Section 7.10 shall not have been
delivered to the Purchase Contract Agent within 30 days after such Act, the
Purchase Contract Agent being removed may petition any court of competent
jurisdiction for the appointment of a successor Purchase Contract Agent.
(d) If at any time:
(1) the Purchase Contract Agent fails to comply with Section 310(b) of
the TIA, as if the Purchase Contract Agent were an indenture trustee under an
indenture qualified under the TIA, and shall fail to resign after written
request therefor by the Company or by any Holder who has been a bona fide Holder
of a Unit for at least six months;
(2) the Purchase Contract Agent shall cease to be eligible under Section
7.08 and shall fail to resign after written request therefor by the Company or
by any such Holder; or
(3) the Purchase Contract Agent shall become incapable of acting or shall
be adjudged a bankrupt or insolvent or a receiver of the Purchase Contract Agent
or of its property shall be appointed or any public officer shall take charge or
control of the Purchase Contract Agent or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove
the Purchase Contract Agent, or (ii) any Holder who has been a bona fide Holder
of a Unit for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the removal
of the Purchase Contract Agent and the appointment of a successor Purchase
Contract Agent.
(e) If the Purchase Contract Agent shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Purchase
Contract Agent for any cause, the Company, by a Board Resolution, shall promptly
appoint a successor Purchase Contract Agent and shall comply with the applicable
requirements of Section 7.10. If no successor Purchase Contract Agent shall have
been so appointed by the Company and accepted appointment in the manner required
by Section 7.10, any Holder who has been a bona fide Holder of a Unit for at
least six months, on behalf of itself and all others similarly situated, or the
Purchase Contract Agent may petition at the expense of the Company, any court of
competent jurisdiction for the appointment of a successor Purchase Contract
Agent.
(f) The Company shall give, or shall cause such successor Purchase
Contract Agent to give, notice of each resignation and each removal of the
Purchase Contract Agent and each appointment of a successor Purchase Contract
Agent by mailing written notice of such event by first-class mail, postage
prepaid, to all Holders as their names and addresses appear in the applicable
Security Register. Each notice shall include the name of the successor Purchase
Contract Agent and the address of its Corporate Trust Office.
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SECTION 7.10. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Purchase Contract
Agent, every such successor Purchase Contract Agent so appointed shall execute,
acknowledge and deliver to the Company and to the retiring Purchase Contract
Agent an instrument accepting such appointment, and thereupon the resignation or
removal of the retiring Purchase Contract Agent shall become effective and such
successor Purchase Contract Agent, without any further act, deed or conveyance,
shall become vested with all the rights, powers, agencies and duties of the
retiring Purchase Contract Agent; but, on the request of the Company or the
successor Purchase Contract Agent, such retiring Purchase Contract Agent shall,
upon payment of its charges, execute and deliver an instrument transferring to
such successor Purchase Contract Agent all the rights, powers and trusts of the
retiring Purchase Contract Agent and duly assign, transfer and deliver to such
successor Purchase Contract Agent all property and money held by such retiring
Purchase Contract Agent hereunder.
(b) Upon request of any such successor Purchase Contract Agent, the
Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Purchase Contract Agent all such
rights, powers and agencies referred to in paragraph (a) of this Section.
(c) No successor Purchase Contract Agent shall accept its appointment
unless at the time of such acceptance such successor Purchase Contract Agent
shall be qualified and eligible under this Article.
SECTION 7.11. Merger, Conversion, Consolidation or Succession to
Business.
Any Person into which the Purchase Contract Agent may be merged or
converted or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which the Purchase Contract Agent shall
be a party, or any Person succeeding to all or substantially all the corporate
trust business of the Purchase Contract Agent, shall be the successor of the
Purchase Contract Agent hereunder, provided that such Person shall be otherwise
qualified and eligible under this Article, without the execution or filing of
any paper or any further act on the part of any of the parties hereto. In case
any Certificates shall have been authenticated and executed on behalf of the
Holders, but not delivered, by the Purchase Contract Agent then in office, any
successor by merger, conversion or consolidation to such Purchase Contract Agent
may adopt such authentication and execution and deliver the Certificates so
authenticated and executed with the same effect as if such successor Purchase
Contract Agent had itself authenticated and executed such Units.
SECTION 7.12. Preservation of Information; Communications to Holders.
(a) The Purchase Contract Agent shall preserve, in as current a form as
is reasonably practicable, the names and addresses of Holders received by the
Purchase Contract Agent in its capacity as Security Registrar.
(b) If three or more Holders (herein referred to as "Applicants") apply
in writing to the Purchase Contract Agent, and furnish to the Purchase Contract
Agent reasonable proof that each such applicant has owned a Unit for a period of
at least six months preceding the date of
75
such application, and such application states that the Applicants desire to
communicate with other Holders with respect to their rights under this Agreement
or under the Units and is accompanied by a copy of the form of proxy or other
communication which such Applicants propose to transmit, then the Purchase
Contract Agent shall mail to all the Holders copies of the form of proxy or
other communication which is specified in such request, with reasonable
promptness after a tender to the Purchase Contract Agent of the materials to be
mailed and of payment, or provision for the payment, of the reasonable expenses
of such mailing.
SECTION 7.13. No Obligations of Purchase Contract Agent.
Except to the extent otherwise expressly provided in this Agreement, the
Purchase Contract Agent assumes no obligations and shall not be subject to any
liability under this Agreement, the Pledge Agreement, the Remarketing Agreement
or any Purchase Contract in respect of the obligations of the Holder of any Unit
thereunder. The Company agrees, and each Holder of a Certificate, by its
acceptance thereof, shall be deemed to have agreed, that the Purchase Contract
Agent's execution of the Certificates on behalf of the Holders shall be solely
as agent and attorney-in-fact for the Holders, and that the Purchase Contract
Agent shall have no obligation to perform such Purchase Contracts on behalf of
the Holders, except to the extent expressly provided in Article Five hereof.
Anything contained in this Agreement to the contrary notwithstanding, in no
event shall the Purchase Contract Agent or its officers, directors, employees or
agents be liable under this Agreement, the Pledge Agreement or the Remarketing
Agreement to any third party for indirect, incidental, 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 Purchase
Contract Agent and regardless of the form of action.
SECTION 7.14. Tax Compliance.
(a) The Purchase Contract Agent, on its own behalf and on behalf of the
Company, will comply with all applicable certification, information reporting
and withholding (including "backup" withholding) requirements imposed by
applicable tax laws, regulations or administrative practice with respect to (i)
any payments made with respect to the Units or (ii) the issuance, delivery,
holding, transfer, redemption or exercise of rights under the Units. Such
compliance shall include, without limitation, the preparation and timely filing
of required returns and the timely payment of all amounts required to be
withheld to the appropriate taxing authority or its designated agent.
(b) The Purchase Contract Agent shall comply in accordance with the terms
hereof with any written direction received from the Company with respect to the
execution or certification of any required documentation and the application of
such requirements to particular payments or Holders or in other particular
circumstances, and may for purposes of this Agreement conclusively rely on any
such direction in accordance with the provisions of Section 7.01(a)(2) hereof.
(c) The Purchase Contract Agent shall maintain all appropriate records
documenting compliance with such requirements, and shall make such records
available, on written request, to the Company or its authorized representative
within a reasonable period of time after receipt of such request.
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ARTICLE VIII
SUPPLEMENTAL AGREEMENTS
SECTION 8.01. Supplemental Agreements Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Purchase Contract Agent, at any time and from time to
time, may enter into one or more agreements supplemental hereto, in form
satisfactory to the Company and the Purchase Contract Agent, to:
(1) evidence the succession of another Person to the Company, and the
assumption by any such successor of the covenants of the Company herein and in
the Certificates;
(2) evidence and provide for the acceptance of appointment hereunder by a
successor Purchase Contract Agent;
(3) add to the covenants of the Company for the benefit of the Holders,
or surrender any right or power herein conferred upon the Company;
(4) make provision with respect to the rights of Holders pursuant to the
requirements of Section 5.04(b); or
(5) except as provided for in Section 5.04, cure any ambiguity, correct
or supplement any provisions herein which may be inconsistent with any other
provisions herein, or make any other provisions with respect to such matters or
questions arising under this Agreement, provided that such action shall not
adversely affect the interests of the Holders in any material respect.
SECTION 8.02. Supplemental Agreements with Consent of Holders.
With the consent of the Holders of not less than a majority of the
Outstanding Units voting together as one class, including without limitation the
consent of the Holders obtained in connection with a tender or an exchange
offer, by Act of said Holders delivered to the Company and the Purchase Contract
Agent, the Company, when authorized by a Board Resolution, and the Purchase
Contract Agent may enter into an agreement or agreements supplemental hereto for
the purpose of modifying in any manner the terms of the Purchase Contracts, or
the provisions of this Agreement or the rights of the Holders in respect of the
Units; provided, however, that, except as contemplated herein, no such
supplemental agreement shall, without the unanimous consent of the Holders of
each outstanding Purchase Contract affected thereby,
(1) change any Payment Date;
(2) change the amount or the type of Collateral required to be Pledged to
secure a Holder's obligations under the Purchase Contract, unless such change is
not adverse to the Holders, impair the right of the Holder of any Purchase
Contract to receive distributions on the related Collateral or otherwise
adversely affect the Holder's rights in or to such Collateral or adversely alter
the rights in or to such Collateral;
77
(3) impair the Holders' right to institute suit for the enforcement of
any Purchase Contract or any Contract Adjustment Payments;
(4) reduce the number of shares of Ordinary Shares or the amount of any
other property to be purchased pursuant to any Purchase Contract, increase the
price to purchase shares of Ordinary Shares or any other property upon
settlement of any Purchase Contract or change the Purchase Contract Settlement
Date or the right to Early Settlement or Cash Merger Early Settlement or
otherwise adversely affect the Holder's rights under the Purchase Contract;
(5) reduce any Contract Adjustment Payments or change any place where, or
the coin or currency in which, any Contract Adjustment Payment is payable; or
(6) reduce the percentage of the outstanding Purchase Contracts the
consent of whose Holders is required for any modification or amendment to the
provisions of this Agreement, the Purchase Contracts or the Pledge Agreement;
PROVIDED THAT if any amendment or proposal referred to above would adversely
affect only the Corporate Units or the Treasury Units, then only the affected
class of Holders as of the record date for the Holders entitled to vote thereon
will be entitled to vote on such amendment or proposal, and such amendment or
proposal shall not be effective except with the consent of Holders of not less
than a majority of such class; and PROVIDED, FURTHER, THAT the unanimous consent
of the Holders of each outstanding Purchase Contract of such class affected
thereby shall be required to approve any amendment or proposal specified in
clauses (1) through (6) above.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental agreement, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 8.03. Execution of Supplemental Agreements.
In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Purchase Contract Agent shall be
provided, and (subject to Section 7.01) shall be fully authorized and protected
in relying upon, an Officers' Certificate and an Opinion of Counsel stating that
the execution of such supplemental agreement is authorized or permitted by this
Agreement and that any and all conditions precedent to the execution and
delivery of such supplemental agreement have been satisfied. The Purchase
Contract Agent may, but shall not be obligated to, enter into any such
supplemental agreement which affects the Purchase Contract Agent's own rights,
duties, privileges, protections, indemnities, liabilities or immunities under
this Agreement or otherwise.
SECTION 8.04. Effect of Supplemental Agreements.
Upon the execution of any supplemental agreement under this Article, this
Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of this Agreement for all purposes; and every Holder
of Certificates theretofore or thereafter authenticated, executed on behalf of
the Holders and delivered hereunder, shall be bound thereby.
78
SECTION 8.05. Reference to Supplemental Agreements.
Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Purchase Contract Agent, bear a
notation in form approved by the Purchase Contract Agent as to any matter
provided for in such supplemental agreement. If the Company shall so determine,
new Certificates so modified as to conform, in the opinion of the Purchase
Contract Agent and the Company, to any such supplemental agreement may be
prepared and executed by the Company and authenticated, executed on behalf of
the Holders and delivered by the Purchase Contract Agent in exchange for
outstanding Certificates.
ARTICLE IX
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 9.01. Covenant Not to Consolidate, Merge, Convey, Transfer or
Lease Property Except under Certain Conditions.
The Company covenants that it will not consolidate with, convert into, or
merge with and into, any other Person or sell, assign, transfer, lease or convey
all or substantially all of its properties and assets to any Person, unless:
(i) either the Company shall be the continuing Person, or the
successor (if other than the Company) shall be a corporation,
partnership, trust or limited liability company organized and existing
under the laws of the United States of America or a State thereof or the
District of Columbia, the Cayman Islands or Bermuda and such Person shall
expressly assume all the obligations of the Company under the Purchase
Contracts, this Agreement, the Pledge Agreement, the Indenture (including
any supplement thereto) and the Remarketing Agreement by one or more
supplemental agreements in form reasonably satisfactory to the Purchase
Contract Agent and the Collateral Agent, executed and delivered to the
Purchase Contract Agent and the Collateral Agent by such Person; and
(ii) the Company or such successor Person, as the case may be,
shall not, immediately after such consolidation, conversion, merger,
sale, assignment, transfer, lease or conveyance, be in default of payment
obligations under the Purchase Contracts, this Agreement, the Pledge
Agreement, the Indenture (including any supplement thereto) or the
Remarketing Agreement or in material default in the performance of any
other covenants under any of the foregoing agreements.
SECTION 9.02. Rights and Duties of Successor Person.
In case of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance and upon any such assumption by a
successor Person in accordance with Section 9.01, such successor Person shall
succeed to and be substituted for the Company with the same effect as if it had
been named herein as the Company. Such successor Person thereupon may cause to
be signed, and may issue either in its own name or in the name of Scottish
Annuity & Life Holdings, Ltd., any or all of the Certificates evidencing Units
issuable hereunder which
79
theretofore shall not have been signed by the Company and delivered to the
Purchase Contract Agent; and, upon the order of such successor Person, instead
of the Company, and subject to all the terms, conditions and limitations in this
Agreement prescribed, the Purchase Contract Agent shall authenticate and execute
on behalf of the Holders and deliver any Certificates which previously shall
have been signed and delivered by the officers of the Company to the Purchase
Contract Agent for authentication and execution, and any Certificate evidencing
Units which such successor Person thereafter shall cause to be signed and
delivered to the Purchase Contract Agent for that purpose. All the Certificates
issued shall in all respects have the same legal rank and benefit under this
Agreement as the Certificates theretofore or thereafter issued in accordance
with the terms of this Agreement as though all of such Certificates had been
issued at the date of the execution hereof.
In case of any such merger, consolidation, share exchange, sale,
assignment, transfer, lease or conveyance such change in phraseology and form
(but not in substance) may be made in the Certificates evidencing Units
thereafter to be issued as may be appropriate.
SECTION 9.03. Officers' Certificate and Opinion of Counsel Given to
Purchase Contract Agent.
The Purchase Contract Agent, subject to Sections 7.01 and 7.03, shall
receive an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that any such merger, consolidation, share exchange, sale, assignment,
transfer, lease or conveyance, and any such assumption, complies with the
provisions of this Article and that all conditions precedent to the consummation
of any such merger, consolidation, share exchange, sale, assignment, transfer,
lease or conveyance have been met.
ARTICLE X
COVENANTS
SECTION 10.01. Performance under Purchase Contracts.
The Company covenants and agrees for the benefit of the Holders from time
to time of the Units that it will duly and punctually perform its obligations
under the Purchase Contracts in accordance with the terms of the Purchase
Contracts and this Agreement.
SECTION 10.02. Maintenance of Office or Agency.
The Company will maintain in the Borough of Manhattan, New York City an
office or agency where Certificates may be presented or surrendered for
acquisition of shares of Ordinary Shares upon settlement of the Purchase
Contracts on the Purchase Contract Settlement Date or upon Early Settlement or
Cash Merger Early Settlement and for transfer of Collateral upon occurrence of a
Termination Event, where Certificates may be surrendered for registration of
transfer or exchange, for a Collateral Substitution or recreation of Corporate
Units and where notices and demands to or upon the Company in respect of the
Units and this Agreement may be served. The Company will give prompt written
notice to the Purchase Contract Agent of the location, and any change in the
location, of such office or agency. The Company initially designates the
Corporate Trust Office of the Purchase Contract Agent as such office of the
80
Company. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Purchase Contract Agent with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the Corporate Trust Office, and the Company hereby appoints the
Purchase Contract Agent as its agent to receive all such presentations,
surrenders, notices and demands.
The Company may also from time to time designate one or more other
offices or agencies where Certificates may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
PROVIDED, HOWEVER, THAT no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, New York City for such purposes. The Company will give
prompt written notice to the Purchase Contract Agent of any such designation or
rescission and of any change in the location of any such other office or agency.
The Company hereby designates as the place of payment for the Units the
Corporate Trust Office and appoints the Purchase Contract Agent at its Corporate
Trust Office as paying agent in such city.
SECTION 10.03. Company to Reserve Ordinary Shares.
The Company shall at all times prior to the Purchase Contract Settlement
Date reserve and keep available, free from preemptive rights, out of its
authorized but unissued Ordinary Shares the full number of shares of Ordinary
Shares issuable against tender of payment in respect of all Purchase Contracts
constituting a part of the Units evidenced by Outstanding Certificates.
SECTION 10.04. Covenants as to Ordinary Shares.
The Company covenants that all shares of Ordinary Shares which may be
issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Units will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.
SECTION 10.05. Statements of Officers of the Company as to Default.
The Company will deliver to the Purchase Contract Agent, within 120 days
after the end of each fiscal year of the Company (which as of the date hereof is
December 31) ending after the date hereof, an Officers' Certificate, stating
whether or not to the knowledge of the signers thereof the Company is in default
in the performance and observance of any of the terms, provisions and conditions
hereof, and if the Company shall be in default, specifying all such defaults and
the nature and status thereof of which they may have knowledge.
SECTION 10.06. ERISA.
Each Holder from time to time of the Units that is a Plan or who used
assets of a Plan to purchase Units hereby represents that either (i) no portion
of the assets used by such Holder to acquire the Corporate Units constitutes
assets of the Plan or (ii) the purchase or holding of the Corporate Units by
such purchaser or transferee will not constitute a non-exempt prohibited
transaction under Section 406 of ERISA or Section 4973 of the Code or similar
violation under any applicable laws.
81
SECTION 10.07. Tax Treatment.
The Company covenants and agrees, and by purchasing a Treasury Unit or a
Corporate Unit each Holder agrees, for United States federal, state and local
income and franchise tax purposes, to (i) treat a Holder's acquisition of the
Treasury Units or Corporate Units as the acquisition of the Treasury Securities,
the Applicable Ownership Interest in the Treasury Portfolio or Notes, as the
case may be, and Purchase Contracts constituting the Treasury Units or the
Corporate Units, as the case may be, (ii) treat each Holder as the owner of the
applicable interest in the Collateral Account, including the Notes and
Applicable Ownership Interests in the Treasury Portfolio or the Treasury
Securities and (iii) treat each Note as indebtedness of the Company.
[SIGNATURES ON THE FOLLOWING PAGE]
82
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
SCOTTISH ANNUITY & LIFE HOLDINGS, LTD.
By:
--------------------------------------
Name:
Title:
---------------------------,
as Purchase Contract Agent
By:
--------------------------------------
Name:
Title:
EXHIBIT A
(FORM OF FACE OF CORPORATE UNIT CERTIFICATE)
[For inclusion in Global Certificates only - THIS CERTIFICATE IS A GLOBAL
CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF CEDE & CO., AS THE NOMINEE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"), THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS
EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A
TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
No. 1 CUSIP No. ______
Number of Corporate Units: ______
SCOTTISH ANNUITY & LIFE HOLDINGS, LTD.
Corporate Units
This Corporate Units Certificate certifies that [Cede & Co.] ______is the
registered Holder of the number of Corporate Units set forth above [For
inclusion in Global Certificates only - or such other number of Corporate Units
reflected in the Schedule of Increases or Decreases in Global Certificate
attached hereto], which number shall not exceed ______. Each Corporate Unit
consists of (i) either (a) the beneficial ownership by the Holder of $______
principal amount of Notes due ______, 200__ (the "Notes") of Scottish Annuity &
Life Holdings, Ltd., a holding company organized under the laws of the Cayman
Islands (the "Company"), subject to the Pledge of such Note by such Holder
pursuant to the Pledge Agreement, or (b) upon the occurrence of a Special Event
Redemption prior to the Purchase Contract Settlement Date or a Successful
Remarketing of the Notes prior to the Final Remarketing Date, the appropriate
Applicable Ownership Interests (as specified in clause (i) of the definition of
such term) in the Treasury Portfolio by such Holder pursuant to the Pledge
Agreement, and (ii) the rights and obligations of the Holder under one Purchase
Contract with the Company. All capitalized terms used herein which are defined
in the
Purchase Contract Agreement (as defined on the reverse hereof) have the
meaning set forth therein.
Pursuant to the Pledge Agreement, the Notes or the appropriate Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio, as the case may be, constituting part of each
Corporate Unit evidenced hereby have been pledged to the Collateral Agent, for
the benefit of the Company, to secure the obligations of the Holder under the
Purchase Contract comprising part of such Corporate Unit.
The Pledge Agreement provides that all payments of the principal amount
with respect to any of the Pledged Notes or the appropriate Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio, as the case may be, or interest or distributions on any
Pledged Notes (as defined in the Pledge Agreement) or the appropriate Applicable
Ownership Interests (as specified in clause (ii) of the definition of such term)
in the Treasury Portfolio, as the case may be, constituting part of the
Corporate Units received by the Securities Intermediary shall be paid by wire
transfer in same day funds (i) in the case of (A) interest on Pledged Notes or
distributions with respect to the appropriate Applicable Ownership Interests (as
specified in clause (ii) of the definition of such term) in the Treasury
Portfolio, as the case may be, and (B) any payments of the principal amount of
any Notes or with respect to the appropriate Applicable Ownership Interests (as
specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, that have been released from the Pledge pursuant
to the Pledge Agreement, to the Purchase Contract Agent to the account
designated by the Purchase Contract Agent, no later than 2:00 p.m., New York
City time, on the Business Day such payment is received by the Securities
Intermediary (provided that in the event such payment is received by the
Securities Intermediary on a day that is not a Business Day or after 12:30 p.m.,
New York City time, on a Business Day, then such payment shall be made no later
than 10:30 a.m., New York City time, on the next succeeding Business Day) and
(ii) in the case of payments with respect to the principal amount of the Notes
or with respect to the appropriate Applicable Ownership Interests (as specified
in clause (i) of the definition of such term) in the Treasury Portfolio, to the
Company on the Purchase Contract Settlement Date (as described herein) in
accordance with the terms of the Pledge Agreement, in full satisfaction of the
respective obligations of the Holders of the Corporate Units of which such
Pledged Notes or the Applicable Ownership Interests (as specified in clause (i)
of the definition of such term) in the Treasury Portfolio, as the case may be,
are a part under the Purchase Contracts forming a part of such Corporate Units.
Interest on the Notes and distributions on the appropriate Applicable Ownership
Interests (as specified in clause (ii) of the definition of such term) in the
Treasury Portfolio, as the case may be, forming part of a Corporate Units
evidenced hereby, which are payable quarterly in arrears on ______, ______,
______, and ______ of each year, commencing ______, 200__ (a "Payment Date"),
shall, subject to receipt thereof by the Purchase Contract Agent from the
Securities Intermediary, be paid to the Person in whose name this Corporate
Units Certificate (or a Predecessor Corporate Units Certificate) is registered
at the close of business on the Record Date for such Payment Date.
Each Purchase Contract evidenced hereby obligates the Holder of this
Corporate Units Certificate to purchase, and the Company to sell, on ______,
200__ (the "Purchase Contract Settlement Date"), at a price equal to $______
(the "Stated Amount"), a number of newly issued
A-2
shares of ordinary shares, par value $0.01 per share ("Ordinary Shares"), of the
Company, equal to the Settlement Rate, unless on or prior to the Purchase
Contract Settlement Date there shall have occurred a Termination Event or an
Early Settlement or Cash Merger Early Settlement with respect to such Purchase
Contract, all as provided in the
Purchase Contract Agreement and more fully
described on the reverse hereof. The purchase price (the "Purchase Price") for
the shares of Ordinary Shares purchased pursuant to each Purchase Contract
evidenced hereby, if not paid earlier, shall be paid on the Purchase Contract
Settlement Date by application of payment received in respect of the principal
amount with respect to any Pledged Notes pursuant to the Remarketing or the
appropriate Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio, as the case may be, pledged
to secure the obligations under such Purchase Contract of the Holder of the
Corporate Units of which such Purchase Contract is a part.
Each Purchase Contract evidenced hereby obligates the Holder to agree,
for United States federal, state and local income and franchise tax purposes, to
(i) treat an acquisition of the Corporate Units as an acquisition of the Notes
and Purchase Contracts constituting the Corporate Units, (ii) treat itself as
owner of the applicable interest in the Collateral Account, including the Notes
and the Applicable Ownership Interests in the Treasury Portfolio and (iii) treat
each Note as indebtedness of the Company.
The Company shall pay, on each Payment Date, in respect of each Purchase
Contract forming part of a Corporate Unit evidenced hereby, an amount (the
"Contract Adjustment Payments") equal to ______% per year of the Stated Amount.
Such Contract Adjustment Payments shall be payable to the Person in whose name
this Corporate Units Certificate is registered at the close of business on the
Record Date for such Payment Date. The Company may, at its option, defer such
Contract Adjustment Payments.
Interest on the Notes and distributions on the Applicable Ownership
Interests (as specified in clause (ii) of the definition of such term) and the
Contract Adjustment Payments will be payable at the office of the Purchase
Contract Agent in New York City. If the book-entry system for the Corporate
Units has been terminated, the Contract Adjustment Payments will be payable, at
the option of the Company, by check mailed to the address of the Person entitled
thereto at such Person's address as it appears on the Security Register, or by
wire transfer to the account designated by such Person by a prior written notice
to the Purchase Contract Agent.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Purchase Contract Agent by manual signature, this Corporate Units Certificate
shall not be entitled to any benefit under the Pledge Agreement or the Purchase
Contract Agreement or be valid or obligatory for any purpose.
A-3
IN WITNESS WHEREOF, the Company and the Holder specified above have
caused this instrument to be duly executed.
Scottish Annuity & Life Holdings, Ltd.
By:
--------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations
of such Holder under the Purchase Contracts)
By:
not individually but solely as
Attorney-in-Fact of such Holder
By:
--------------------------------------
Name:
Title:
DATED:
----------------------------
A-4
CERTIFICATE OF AUTHENTICATION
OF PURCHASE CONTRACT AGENT
This is one of the Corporate Units Certificates referred to in the within
mentioned Purchase Contract Agreement.
By:
as Purchase Contract Agent
By:
--------------------------------------
Name:
Title:
DATED:
---------------------------
A-5
(FORM OF REVERSE OF CORPORATE UNIT CERTIFICATE)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of ______, 200__ (as may be supplemented from time
to time, the "Purchase Contact Agreement"), between the Company and ______, as
Purchase Contract Agent (including its successors hereunder, the "Purchase
Contract Agent"), to which Purchase Contract Agreement and supplemental
agreements thereto reference is hereby made for a description of the respective
rights, limitations of rights, obligations, duties and immunities thereunder of
the Purchase Contract Agent, the Company, and the Holders and of the terms upon
which the Corporate Units Certificates are, and are to be, executed and
delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Corporate Units Certificate to purchase, and the Company to sell, on the
Purchase Contract Settlement Date at a price equal to the Stated Amount (the
"Purchase Price"), a number of shares of Ordinary Shares equal to the Settlement
Rate, unless an Early Settlement, a Cash Merger Early Settlement or a
Termination Event with respect to the Units of which such Purchase Contract is a
part shall have occurred. The "Settlement Rate" is equal to:
(1) if the Adjusted Applicable Market Value (as defined below) is
greater than or equal to $______ (the "Threshold Appreciation Price"),
______ shares of Ordinary Shares per Purchase Contract;
(2) if the Adjusted Applicable Market Value is less than the
Threshold Appreciation Price but greater than $______ (the "Reference
Price"), the number of shares of Ordinary Shares per Purchase Contact
having a value equal to the Stated Amount divided by the Adjusted
Applicable Market Value; and
(3) if the Adjusted Applicable Market Value is less than or equal
to the Reference Price, ______ shares of Ordinary Shares per Purchase
Contract;
in each case subject to adjustment as provided in the Purchase Contract
Agreement (and in each case rounded upward or downward to the nearest 1/10,000th
of a share).
No fractional shares of Ordinary Shares will be issued upon settlement of
Purchase Contracts, as provided in Section 5.09 of the Purchase Contract
Agreement.
Each Purchase Contract evidenced hereby, which is settled through Early
Settlement or Cash Merger Early Settlement shall obligate the Holder of the
related Corporate Units to purchase at the Purchase Price, and the Company to
sell, a number of newly issued shares of Ordinary Shares equal to the Early
Settlement Rate (in the case of an Early Settlement) or applicable Settlement
Rate (in the case of a Cash Merger Early Settlement).
The "APPLICABLE MARKET VALUE" means the average of the Closing Price per
share of Ordinary Shares on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date subject to adjustments set forth under Section 5.04 of the Purchase
Contract Agreement.
A-6
The "ADJUSTED APPLICABLE MARKET VALUE" means (i) prior to any adjustment
of the Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7)
or (10) of Section 5.04(a) of the Purchase Contract Agreement, the Applicable
Market Value, and (ii) at the time of and after any adjustment of the Settlement
Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of Section
5.04(a) of the Purchase Contract Agreement, the Applicable Market Value
multiplied by a fraction, the numerator of which shall be the Settlement Rate
immediately after such adjustment pursuant to paragraph (1), (2), (3), (4), (5),
(6), (7) or (10) of Section 5.04(a) of the Purchase Contract Agreement and the
denominator of which shall be the Settlement Rate immediately prior to such
adjustment; provided, however, that if such adjustment to the Settlement Rate is
required to be made pursuant to the occurrence of any of the events contemplated
by paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of Section 5.04(a) of the
Purchase Contract Agreement during the period taken into consideration for
determining the Applicable Market Value, appropriate and customary adjustments
shall be made to the Settlement Rate.
The "CLOSING PRICE" per share of Ordinary Shares on any date of
determination means:
(1) the closing sale price as of the close of the principal
trading session (or, if no closing price is reported, the last reported
sale price) per share on the New York Stock Exchange, Inc. (the "NYSE")
on such date;
(2) if Ordinary Shares are not listed for trading on the NYSE on
any such date, the closing sale price (or, if no closing price is
reported, the last reported sale price) per share as reported in the
composite transactions for the principal United States national or
regional securities exchange on which Ordinary Shares are so listed;
(3) if Ordinary Shares are not so listed on a United States
national or regional securities exchange, the last closing sale price per
share as reported by The Nasdaq Stock Market, Inc.;
(4) if Ordinary Shares are not so reported, the last quoted bid
price per share of Ordinary Shares in the over-the-counter market as
reported by the National Quotation Bureau or similar organization; or
(5) if such bid price is not available, the market value of
Ordinary Shares on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the
Company.
A "TRADING DAY" means a day on which Ordinary Shares (1) are not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (2) have
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of Ordinary Shares.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Corporate Units Certificate may pay the Purchase Price for the
shares of Ordinary Shares purchased pursuant to each Purchase Contract evidenced
hereby, by effecting a Cash Settlement,
A-7
an Early Settlement or, if applicable, a Cash Merger Early Settlement or from
the proceeds of the Applicable Ownership Interests (as specified in clause (i)
of the definition of such term) in the Treasury Portfolio or a Remarketing of
the related Pledged Notes. Unless the Treasury Portfolio has replaced the Notes
as a component of Corporate Units, a Holder of Corporate Units who (1) does not,
on or prior to 5:00 p.m. (New York City time) on the fifth Business Day
immediately preceding the Purchase Contract Settlement Date, notify the Purchase
Contract Agent of its intention to effect a Cash Settlement, or who does so
notify the Purchase Contract Agent but fails to make an effective Cash
Settlement prior to 5:00 p.m. (New York City time) on the fourth Business Day
immediately preceding the Purchase Contract Settlement Date, or (2) on or prior
to 5:00 p.m. (New York City time) on the fifth Business Day prior to the
Purchase Contract Settlement Date, does not make an effective Early Settlement,
shall pay the Purchase Price, less the amount of any Deferred Contract
Adjustment Payments payable to such Holder, for the shares of Ordinary Shares to
be delivered under the related Purchase Contract from the proceeds of the sale
of the related Pledged Notes held by the Collateral Agent unless the Holder has
previously made a Cash Merger Early Settlement. Unless the Treasury Portfolio
has replaced the Notes as a component of Corporate Unit, such sale will be made
by the Remarketing Agent pursuant to the terms of the Remarketing Agreement on
the Final Remarketing Date. If the Treasury Portfolio has replaced the Notes as
a component of Corporate Units, a Holder of Corporate Units shall pay the
Purchase Price for the shares of Ordinary Shares to be delivered under the
related Purchase Contract from the proceeds at maturity of the Applicable
Ownership Interests (as defined in clause (i) of the definition of such term) in
the Treasury Portfolio.
If, as provided in the Purchase Contract Agreement, upon the occurrence
of a Failed Final Remarketing, the Collateral Agent, for the benefit of the
Company, exercises its rights as a secured creditor with respect to the Pledged
Notes related to this Corporate Units Certificate, any accrued and unpaid
interest on such Pledged Notes will become payable by the Company to the holder
of this Corporate Units Certificate in the manner provided for in the Purchase
Contract Agreement.
The Company shall not be obligated to issue any shares of Ordinary Shares
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment of the aggregate Purchase Price for
the shares of Ordinary Shares to be purchased thereunder in the manner set forth
in the Purchase Contract Agreement.
Each Purchase Contract evidenced hereby and all obligations and rights of
the Company and the Holder thereunder shall terminate if a Termination Event
shall occur. Upon the occurrence of a Termination Event, the Company shall give
written notice to the Purchase Contract Agent and to the Holders, at their
addresses as they appear in the Security Register. Upon and after the occurrence
of a Termination Event, the Collateral Agent shall release the Pledged Notes or
the appropriate Applicable Ownership Interests (as specified in clause (i) of
the definition of such term) in the Treasury Portfolio forming a part of each
Corporate Unit from the Pledge. A Corporate Unit shall thereafter represent the
right to receive the Note or the appropriate Applicable Ownership Interests in
the Treasury Portfolio forming a part of such Corporate Units in accordance with
the terms of the Purchase Contract Agreement and the Pledge Agreement.
A-8
Under the terms of the Pledge Agreement and the Purchase Contract
Agreement, the Purchase Contract Agent will be entitled to exercise the voting
and any other consensual rights pertaining to the Pledged Notes, but only to the
extent instructed in writing by the Holders. Upon receipt of notice of any
meeting at which holders of Notes are entitled to vote or upon the solicitation
of consents, waivers or proxies of holders of Notes, the Purchase Contract Agent
shall, as soon as practicable thereafter, mail to the Corporate Units Holders a
notice:
(1) containing such information as is contained in the notice or
solicitation;
(2) stating that each Corporate Units Holder on the record date
set by the Purchase Contract Agent therefor (which, to the extent
possible, shall be the same date as the record date for determining the
holders of Notes entitled to vote) shall be entitled to instruct the
Purchase Contract Agent as to the exercise of the voting rights
pertaining to the Notes constituting a part of such Holder's Corporate
Units; and
(3) stating the manner in which such instructions may be given.
Upon the written request of the Corporate Units Holders on such record
date, received by the Purchase Contract Agent at least six days prior to such
meeting, the Purchase Contract Agent shall endeavor insofar as practicable to
vote or cause to be voted, in accordance with the instructions set forth in such
requests, the maximum aggregate principal amount of Notes as to which any
particular voting instructions are received. In the absence of specific
instructions from the Holder of a Corporate Unit, the Purchase Contract Agent
shall abstain from voting the Note evidenced by such Corporate Unit.
Upon the occurrence of a Special Event Redemption, the Collateral Agent
shall surrender the Pledged Notes against delivery of an amount equal to the
aggregate Redemption Price of the Pledged Notes and shall deposit funds in the
Collateral Account in exchange for the Pledged Notes. Thereafter, pursuant to
the terms of the Pledge Agreement, the Collateral Agent shall cause the
Securities Intermediary to apply an amount equal to the aggregate Redemption
Amount of such funds to purchase on behalf of the Holders of Corporate Units,
the Treasury Portfolio and promptly (a) transfer the Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) in the
Treasury Portfolio to the Collateral Account to secure the obligations of each
Holder of Corporate Units to purchase shares of Ordinary Shares under the
Purchase Contracts constituting a part of such Corporate Units, (b) transfer the
Applicable Ownership Interests (as specified in clause (ii) of the definition of
such term) in the Treasury Portfolio to the Purchase Contract Agent for the
benefit of the Holders of such Corporate Units and (C) remit the remaining
portion of such funds to the Purchase Contract Agent for payment to the Holders
of such Corporate Units.
Upon the occurrence of a Successful Remarketing of Notes prior to the
Final Remarketing Date, pursuant to the terms of the Remarketing Agreement, the
Remarketing Agent will apply an amount equal to the Treasury Portfolio Purchase
Price to purchase on behalf of the Holders of Corporate Units, the Treasury
Portfolio, and, after deducting the Remarketing Fee to the extent permitted
under the terms of the Remarketing Agreement, promptly remit the remaining
portion of such proceeds of such Successful Remarketing to the Purchase Contract
Agent for payment to the Holders of such Corporate Units.
A-9
Following the occurrence of (i) a Special Event Redemption prior to the
Purchase Contract Settlement Date, or (ii) a Successful Remarketing of the Notes
prior to the Final Remarketing Date, the Holders of Corporate Units and the
Collateral Agent shall have such security interest rights and obligations with
respect to the Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio as the Holder of Corporate
Units and the Collateral Agent had in respect of the Notes, as the case may be,
subject to the Pledge thereof as provided in the Pledge Agreement and any
reference herein to the Notes shall be deemed to be a reference to such Treasury
Portfolio.
The Corporate Units Certificates are issuable only in registered form and
only in denominations of a single Corporate Unit and any integral multiple
thereof. The transfer of any Corporate Units Certificate will be registered and
Corporate Units Certificates may be exchanged as provided in the Purchase
Contract Agreement. The Security Registrar may require a Holder, among other
things, to furnish appropriate endorsements and transfer documents permitted by
the Purchase Contract Agreement. No service charge shall be required for any
such registration of transfer or exchange, but the Company and the Purchase
Contract Agent may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. A Holder who elects to
substitute a Treasury Security for a Note, thereby creating Treasury Units,
shall be responsible for any fees or expenses payable in connection therewith.
Except as provided in the Purchase Contract Agreement, for so long as the
Purchase Contract underlying a Corporate Units remains in effect, such Corporate
Units shall not be separable into its constituent parts, and the rights and
obligations of the Holder of such Corporate Units in respect of the Notes and
Purchase Contract constituting such Corporate Units may be transferred and
exchanged only as a Corporate Unit.
Unless the Treasury Portfolio has replaced the Notes as a component of
the Corporate Units, and subject to the conditions set forth in the Purchase
Contract Agreement, the Holder of Corporate Units may substitute, at any time
prior to 5:00 p.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, for the Pledged Notes securing
such Holder's obligations under the related Purchase Contracts, Treasury
Securities in an aggregate principal amount at maturity equal to the aggregate
principal amount of the Pledged Notes in accordance with the terms of the
Purchase Contract Agreement and the Pledge Agreement. From and after such
Collateral Substitution, each Unit for which such Pledged Treasury Securities
secures the Holder's obligation under the Purchase Contract shall be referred to
as a "Treasury Unit". A Holder may make such Collateral Substitution only in
integral multiples of 40 Corporate Units for 40 Treasury Units.
If the Treasury Portfolio has replaced the Notes as a component of the
Corporate Units, a Holder may, at any time on or prior to the second Business
Day immediately preceding the Purchase Contract Settlement Date, substitute
Treasury Securities for the Applicable Ownership Interests in the Treasury
Portfolio, but only in integral multiples of 80,000 Corporate Units. In such an
event, the Holder shall transfer Treasury Securities to the Collateral Agent,
and the Purchase Contract Agent shall instruct the Collateral Agent to release
the Pledge of and transfer to the Holder the appropriate Applicable Ownership
Interests in the Treasury Portfolio.
The Company shall pay, on each Payment Date, the Contract Adjustment
Payments payable in respect of each Purchase Contract to the Person in whose
name the Corporate Units
A-10
Certificate evidencing such Purchase Contract is registered at the close of
business on the Record Date for such Payment Date. Contract Adjustment Payments
will be payable at the office of the Purchase Contract Agent in New York City.
If the book-entry system for the Corporate Units has been terminated, the
Contract Adjustment Payments will be payable, at the option of the Company, by
check mailed to the address of the Person entitled thereto at such Person's
address as it appears on the Security Register, or by wire transfer to the
account designated by such Person by a prior written notice to the Purchase
Contract Agent.
The Company has the right to defer payment of all or part of the Contract
Adjustment Payments in respect of each Purchase Contract until no later than the
Purchase Contract Settlement Date (or in the event of an effective Early
Settlement or Cash Merger Early Settlement, the Early Settlement Date or Cash
Merger Early Settlement Date, as the case may be) as set forth in the Purchase
Contract Agreement. If the Company so elects to defer Contract Adjustment
Payments, the Company shall pay additional Contract Adjustment Payments on such
deferred installments of Contract Adjustment Payments at a rate equal to ______%
per annum, compounding on each succeeding Payment Date, until such deferred
installments are paid. In the event that the Company elects to defer the payment
of Contract Adjustment Payments on the Purchase Contracts until the Purchase
Contract Settlement Date (or, in the event of an effective Early Settlement or
Cash Merger Early Settlement, the Early Settlement Date or Cash Merger Early
Settlement Date, as the case may be), each Holder will receive on the Purchase
Contract Settlement Date, Early Settlement Date or Cash Merger Early Settlement
Date, as applicable, the Deferred Contract Adjustment Payments to the extent
such fees are not deducted from the Settlement Price in the case of a Cash
Settlement or any Early Settlement or Cash Merger Early Settlement as set forth
in the Purchase Contract Agreement.
The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Contract Adjustment
Payments, shall immediately and automatically terminate, without the necessity
of any notice or action by any Holder, the Purchase Contract Agent or the
Company, if, on or prior to the Purchase Contract Settlement Date, a Termination
Event shall have occurred. Upon the occurrence of a Termination Event, the
Company shall promptly but in no event later than two Business Days thereafter
give written notice to the Purchase Contract Agent, the Collateral Agent and the
Holders, at their addresses as they appear in the Security Register. Upon and
after the occurrence of a Termination Event, the Collateral Agent shall release
the Notes or the appropriate Applicable Ownership Interests (as specified in
clause (i) of the definition of such term) in the Treasury Portfolio, as the
case may be, from the Pledge in accordance with the provisions of the Pledge
Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
underlying Units may be settled early at any time prior to 5:00 p.m. (New York
City time) on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date ("Early Settlement") as provided in the Purchase Contract
Agreement. In order to exercise the right to effect Early Settlement with
respect to any Purchase Contract evidenced by this Certificate, the Holder of
this Corporate Units Certificate shall deliver to the Purchase Contract Agent at
the Corporate Trust Office an Election to Settle Early form set forth below duly
completed and accompanied by payment in the
A-11
form of immediately available funds payable to the order of the Company in an
amount (the "Early Settlement Amount") equal to:
(i) the sum of (A) the product of (I) the Stated Amount times (II)
the number of Purchase Contracts with respect to which the Holder has
elected to effect Early Settlement, plus (B) if such delivery is made
with respect to any Purchase Contracts during the period from the close
of business on any Record Date next preceding any Payment Date to the
opening of business on such Payment Date, an amount equal to the Contract
Adjustment Payments (including any Deferred Contract Adjustment Payments)
payable on such Payment Date with respect to such Purchase Contracts,
less
(ii) the amount of any Deferred Contract Adjustment Payments
payable to such Holder as a result of such Early Settlement.
Upon Early Settlement of Purchase Contracts by a Holder of the related
Units, the Pledged Notes or Pledge Applicable Ownership Interests (as specified
in clause (i) of the definition of such term) underlying such Units shall be
released from the Pledge as provided in the Pledge Agreement and the Holder
shall be entitled to receive a number of shares of Ordinary Shares on account of
each Purchase Contract forming part of a Corporate Unit as to which Early
Settlement is effected equal to ______ shares of Ordinary Shares per Purchase
Contract (the "Early Settlement Rate"). The Early Settlement Rate shall be
adjusted in the same manner and at the same time as the Settlement Rate is
adjusted as provided in Section 5.04 of the Purchase Contract Agreement.
Upon the occurrence of a Cash Merger, a Holder of Corporate Units may
effect Cash Merger Early Settlement of the Purchase Contract underlying such
Corporate Units pursuant to the terms of Section 5.04(b)(2) of the Purchase
Contract Agreement. Upon Cash Merger Early Settlement of Purchase Contracts by a
Holder of the related Corporate Units, the Pledged Notes or Pledged Applicable
Ownership Interests (as specified in clause (i) of the definition of such term)
in the Treasury Portfolio underlying such Corporate Units shall be released from
the Pledge as provided in the Pledge Agreement.
Upon registration of transfer of this Corporate Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Purchase Contract Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Corporate Units Certificate. The Company covenants and agrees,
and the Holder, by its acceptance hereof, likewise covenants and agrees, to be
bound by the provisions of this paragraph.
The Holder of this Corporate Units Certificate, by its acceptance hereof,
authorizes the Purchase Contract Agent to enter into and perform the related
Purchase Contracts forming part of the Corporate Units evidenced hereby on its
behalf as its attorney-in-fact, expressly withholds any consent to the
assumption (i.e., affirmance) of the Purchase Contracts by the Company or its
trustee in the event that the Company becomes the debtor under the Bankruptcy
Code or subject to other similar state or Federal law providing for
reorganization or liquidation, agrees to be
A-12
bound by the terms and provisions thereof, covenants and agrees to perform its
obligations under such Purchase Contracts, consents to the provisions of the
Purchase Contract Agreement, authorizes the Purchase Contract Agent to enter
into and perform the Purchase Contract Agreement and the Pledge Agreement on its
behalf as its attorney-in-fact, and consents to the Pledge of the Notes or the
appropriate Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio, as the case may be,
underlying this Corporate Units Certificate pursuant to the Pledge Agreement.
The Holder further covenants and agrees that, to the extent and in the manner
provided in the Purchase Contract Agreement and the Pledge Agreement, but
subject to the terms thereof, payments with respect to the aggregate principal
amount of the Pledged Notes or the appropriate Applicable Ownership Interests
(as specified in clause (i) of the definition of such term) in the Treasury
Portfolio, as the case may be, on the Purchase Contract Settlement Date shall be
paid by the Collateral Agent to the Company in satisfaction of such Holder's
obligations under such Purchase Contract and such Holder shall acquire no right,
title or interest in such payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall be governed by, and construed in accordance
with, the laws of the State of New York, without giving effect to the conflicts
of law provisions thereof.
Prior to due presentment of this Certificate for registration of
transfer, the Company, the Purchase Contract Agent and its Affiliates and any
agent of the Company or the Purchase Contract Agent may treat the Person in
whose name this Corporate Units Certificate is registered as the owner of the
Corporate Units evidenced hereby for the purpose of receiving payments of
interest payable on the Notes, receiving payments of Contract Adjustment
Payments (subject to any applicable record date), performance of the Purchase
Contracts and for all other purposes whatsoever, whether or not any payments in
respect thereof be overdue and notwithstanding any notice to the contrary, and
neither the Company, the Purchase Contract Agent nor any such agent shall be
affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Ordinary
Shares.
A copy of the Purchase Contract Agreement is available for inspection at
the offices of the Purchase Contract Agent.
A-13
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM: as tenants in common
UNIF GIFT MIN ACT: _________________________ Custodian ________________________
(cust) (minor)
Under Uniform Gifts to Minors Act of
TENANT: as tenants by the entireties
JT TEN: as joint tenants with right of survivorship and not as tenants in
common
Additional abbreviations may also be used though not in the above list.
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
--------------------------------------------------------------------------------
(Please insert Social Security or Taxpayer I.D. or other
Identifying Number of Assignee)
--------------------------------------------------------------------------------
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Corporate Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing attorney ______, to transfer said
Corporate Units Certificates on the books of Scottish Annuity & Life Holdings,
Ltd., with full power of substitution in the premises.
Dated: Signature
------------------------- ----------------------------------
NOTICE: The signature to this assignment
must correspond with the name as it appears
upon the face of the within Corporate Units
Certificates in every particular, without
alteration or enlargement or any change
whatsoever.
Signature Guarantee:
-----------------------------------
A-14
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Ordinary
Shares deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Corporate Units
evidenced by this Corporate Units Certificate be registered in the name of, and
delivered, together with a check in payment for any fractional share, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer tax
payable incident thereto.
___________________________________________
Dated:________________________ Signature
Signature Guarantee:_______________________
(if assigned to another person)
If shares are to be registered in
the name of and delivered to a REGISTERED HOLDER
Person other than the Holder,
please (i) print such Person's name
and address and (ii) provide a Please print name and address of
guarantee of your signature: Registered Holder:
____________________________________ _________________________________________
Name Name
____________________________________ _________________________________________
Address Address
____________________________________ _________________________________________
____________________________________ _________________________________________
____________________________________ _________________________________________
Social Security or other Taxpayer
Identification Number, if any
_________________________________________
A-15
ELECTION TO SETTLE EARLY/CASH MERGER EARLY SETTLEMENT
The undersigned Holder of this Corporate Units Certificate hereby
irrevocably exercises the option to effect [Early Settlement] [Cash Merger Early
Settlement following a Cash Merger] in accordance with the terms of the Purchase
Contract Agreement with respect to the Purchase Contracts underlying the number
of Corporate Units evidenced by this Corporate Units Certificate specified
below. The undersigned Holder directs that a certificate for shares of Ordinary
Shares or other securities deliverable upon such [Early Settlement] [Cash Merger
Early Settlement] be registered in the name of, and delivered, together with a
check in payment for any fractional share and any Corporate Units Certificate
representing any Corporate Units evidenced hereby as to which [Early Settlement]
[Cash Merger Early Settlement] of the related Purchase Contracts is not
effected, to the undersigned at the address indicated below unless a different
name and address have been indicated below. Pledged Notes or the appropriate
Applicable Ownership Interests in the Treasury Portfolio, as the case may be,
deliverable upon such [Early Settlement] [Cash Merger Early Settlement] will be
transferred in accordance with the transfer instructions set forth below. If
shares are to be registered in the name of a Person other than the undersigned,
the undersigned will pay any transfer tax payable incident thereto.
Dated _______________________________ ________________________________________
Signature
Signature Guarantee: ___________________________________________
A-16
Number of Units evidenced hereby as to which [Early Settlement] [Cash
Merger Early Settlement] of the related Purchase Contracts is being elected:
If shares of Ordinary Shares or Corporate REGISTERED HOLDER
Units Certificates are to be
registered in the name of and
delivered to and Pledged Notes or
the Applicable Ownership Interests
in the Treasury Portfolio, as the case
may be, are to be transferred to a
Person other than the Holder, please
print such Person's name and address:
Please print name and address of
Registered Holder:
____________________________________ _________________________________________
Name Name
____________________________________ _________________________________________
Address Address
____________________________________ _________________________________________
____________________________________ _________________________________________
____________________________________ _________________________________________
Social Security or other Taxpayer
Identification Number, if any
_________________________________________
Transfer Instructions for Pledged Notes or the Applicable Ownership Interests in
the Treasury Portfolio, as the case may be, transferable upon [Early Settlement]
[Cash Merger Early Settlement] or a Termination Event:
A-17
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The initial number of Corporate Units of this Global Certificate is ______. The
following increases or decreases in this Global Certificate have been made:
-------------------- ------------------------ ----------------------- ------------------------ -----------------------
Number or Corporate
Amount of increase Amount of decrease Units evidenced by
in Number of in Number of this Global Signature of
Corporate Units Corporate Units Certificate authorized signatory
evidenced by the evidenced by the following such of Purchase Contract
Date Global Certificate Global Certificate decrease or increase Agent
-------------------- ------------------------ ----------------------- ------------------------ -----------------------
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A-18
EXHIBIT B
(FORM OF FACE OF TREASURY UNIT CERTIFICATE)
[For inclusion in Global Certificate only - THIS CERTIFICATE IS A GLOBAL
CERTIFICATE WITHIN THE MEANING OF THE PURCHASE CONTRACT AGREEMENT HEREINAFTER
REFERRED TO AND IS REGISTERED IN THE NAME OF CEDE & CO., AS NOMINEE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"), THE
DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS
EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE
PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A
TRANSFER OF THIS CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
No. 1 CUSIP No. ______
Number of Treasury Units: ______
Scottish Annuity & Life Holdings, Ltd.
Treasury Units
This Treasury Units Certificate certifies that [Cede & Co.] ______ is the
registered Holder of the number of Treasury Units set forth above [For inclusion
in Global Certificates only - or such other number of Treasury Units as is
reflected in the Schedule of Increases or Decreases in Global Certificate
attached hereto], which number shall not exceed ______. Each Treasury Unit
consists of (i) a 1/40 undivided beneficial ownership interest of a Treasury
Security having a principal amount at maturity equal to $1,000, subject to the
Pledge of such Treasury Security by such Holder pursuant to the Pledge
Agreement, and (ii) the rights and obligations of the Holder under one Purchase
Contract with Scottish Annuity & Life Holdings, Ltd., a holding company
organized under the laws of the Cayman Islands (the "Company"). All capitalized
terms used herein which are defined in the Purchase Contract Agreement (as
defined on the reverse hereof) have the meaning set forth therein.
Pursuant to the Pledge Agreement, the Treasury Securities constituting
part of each Treasury Unit evidenced hereby have been pledged to the Collateral
Agent, for the benefit of the Company, to secure the obligations of the Holder
under the Purchase Contract comprising part of such Treasury Unit. Each Purchase
Contract evidenced hereby obligates the Holder of this Treasury Units
Certificate to purchase, and the Company, to sell, on ______, 200__ (the
"Purchase Contract Settlement Date"), at a price equal to $______ (the "Stated
Amount"), a number of newly issued shares of ordinary shares, par value $0.01
per share ("Ordinary Shares"), of the Company, equal to the Settlement Rate,
unless prior to or on the Purchase Contract Settlement Date there shall have
occurred a Termination Event, an Early Settlement or a Cash Merger Early
Settlement with respect to such Purchase Contract, all as provided in the
Purchase Contract Agreement and more fully described on the reverse hereof. The
purchase price (the "Purchase Price") for the shares of Ordinary Shares
purchased pursuant to each Purchase Contract evidenced hereby, if not paid
earlier, shall be paid on the Purchase Contract Settlement Date by application
of the proceeds from the Treasury Securities at maturity pledged to secure the
obligations of the Holder under such Purchase Contract of the Treasury Units of
which such Purchase Contract is a part.
Each Purchase Contract evidenced hereby obligates the Holder to agree,
for United States federal, state and local income and franchise tax purposes, to
(i) treat an acquisition of the Treasury Units as an acquisition of the Treasury
Securities and Purchase Contracts constituting the Treasury Units and (ii) treat
itself as owner of the applicable interest in the Collateral Account, including
the Treasury Securities.
The Company shall pay, on each Payment Date, in respect of each Purchase
Contract forming part of a Treasury Unit evidenced hereby, an amount (the
"Contract Adjustment Payments") equal to ______% per year of the Stated Amount.
Such Contract Adjustment Payments shall be payable to the Person in whose name
this Treasury Units Certificate is registered at the close of business on the
Record Date for such Payment Date. The Company may, at its option, defer such
Contract Adjustment Payments.
Contract Adjustment Payments will be payable at the office of the
Purchase Contract Agent in New York City. If the book-entry system for the
Corporate Units has been terminated, the Contract Adjustment Payments will be
payable, at the option of the Company, by check mailed to the address of the
Person entitled thereto at such Person's address as it appears on the Security
Register, or by wire transfer to the account designated by such Person by a
prior written notice to the Purchase Contract Agent.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Purchase Contract Agent by manual signature, this Treasury Units Certificate
shall not be entitled to any benefit under the Pledge Agreement or the Purchase
Contract Agreement or be valid or obligatory for any purpose.
B-2
IN WITNESS WHEREOF, the Company and the Holder specified above have
caused this instrument to be duly executed.
Scottish Annuity & Life Holdings, Ltd.
By:
-----------------------------------------
Name:
Title:
HOLDER SPECIFIED ABOVE (as to obligations of
such Holder under the Purchase Contracts)
By:
-----------------------------------------
not individually but solely as
Attorney-in-Fact of such Holder
By:
-----------------------------------------
Authorized Officer
Dated:
-------------------------
B-3
CERTIFICATE OF AUTHENTICATION OF
PURCHASE CONTRACT AGENT
This is one of the Treasury Units referred to in the within-mentioned
Purchase Contract Agreement.
By:
----------------------------------------,
as Purchase Contract Agent
By:
-----------------------------------------
Authorized Officer
Dated:
--------------------------
B-4
(REVERSE OF TREASURY UNIT CERTIFICATE)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of ______, 200__ (as such may be supplemented from
time to time, the "Purchase Contract Agreement") between the Company and ______,
as Purchase Contract Agent (including its successors thereunder, herein called
the "Purchase Contract Agent"), to which the Purchase Contract Agreement and
supplemental agreements thereto reference is hereby made for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Purchase Contract Agent, the Company and the Holders and of
the terms upon which the Treasury Units Certificates are, and are to be,
executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Treasury Units Certificate to purchase, and the Company to sell, on the Purchase
Contract Settlement Date at a price equal to the Stated Amount (the "Purchase
Price") a number of newly issued shares of Ordinary Shares equal to the
Settlement Rate, unless an Early Settlement, a Cash Merger Early Settlement or a
Termination Event with respect to the Units of which such Purchase Contract is a
part shall have occurred. The "Settlement Rate" is equal to:
(1) if the Adjusted Applicable Market Value (as defined below) is
greater than or equal to $______ (the "Threshold Appreciation Price"),
______ shares of Ordinary Shares per Purchase Contract;
(2) if the Adjusted Applicable Market Value is less than the
Threshold Appreciation Price but greater than $______ (the "Reference
Price"), the number of shares of Ordinary Shares per Purchase Contact
having a value equal to the Stated Amount divided by the Adjusted
Applicable Market Value; and
(3) if the Adjusted Applicable Market Value is less than or equal
to the Reference Price, ______ shares of Ordinary Shares per Purchase
Contract;
in each case subject to adjustment as provided in the Purchase Contract
Agreement (and in each case rounded upward or downward to the nearest 1/10,000th
of a share).
No fractional shares of Ordinary Shares will be issued upon settlement of
Purchase Contracts, as provided in Section 5.09 of the Purchase Contract
Agreement.
Each Purchase Contract evidenced hereby that is settled through Early
Settlement or Cash Merger Early Settlement shall obligate the Holder of the
related Treasury Units to purchase at the Purchase Price, and the Company to
sell, a number of newly issued shares of Ordinary Shares equal to the Early
Settlement Rate (in the case of an Early Settlement) or applicable Settlement
Rate (in the case of a Cash Merger Early Settlement).
The "APPLICABLE MARKET VALUE" means the average of the Closing Prices per
share of Ordinary Shares on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date, subject to adjustments set forth under Section 5.04 hereof.
B-5
The "ADJUSTED APPLICABLE MARKET VALUE" means (i) prior to any adjustment
of the Settlement Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7)
or (10) of Section 5.04(a) of the Purchase Contract Agreement, the Applicable
Market Value, and (ii) at the time of and after any adjustment of the Settlement
Rate pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of Section
5.04(a) of the Purchase Contract Agreement, the Applicable Market Value
multiplied by a fraction, the numerator of which shall be the Settlement Rate
immediately after such adjustment pursuant to paragraph (1), (2), (3), (4), (5),
(6), (7) or (10) of Section 5.04(a) of the Purchase Contract Agreement and the
denominator of which shall be the Settlement Rate immediately prior to such
adjustment; provided, however, that if such adjustment to the Settlement Rate is
required to be made pursuant to the occurrence of any of the events contemplated
by paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of Section 5.04(a) of the
Purchase Contract Agreement during the period taken into consideration for
determining the Applicable Market Value, appropriate and customary adjustments
shall be made to the Settlement Rate.
The "CLOSING PRICE" per share of Ordinary Shares on any date of
determination means the:
(1) closing sale price as of the close of the principal trading
session (or, if no closing price is reported, the last reported sale
price) per share on the New York Stock Exchange, Inc. (the "NYSE") on
such date;
(2) if the Ordinary Shares are not listed for trading on the NYSE
on any such date, the closing sale price (or, if no closing price is
reported, the last reported sale price) per share as reported in the
composite transactions for the principal United States national or
regional securities exchange on which the Ordinary Shares are so listed;
(3) if the Ordinary Shares are not so listed on a United States
national or regional securities exchange, the last closing sale price per
share as reported by The Nasdaq Stock Market, Inc.;
(4) if the Ordinary Shares are not so reported, the last quoted
bid price for the Ordinary Shares in the over-the-counter market as
reported by the National Quotation Bureau or similar organization; or
(5) if such bid price is not available, the market value of the
Ordinary Shares on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the
Company.
A "TRADING DAY" means a day on which the Ordinary Shares (1) are not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (2) have
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Ordinary Shares.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Treasury Unit shall pay the Purchase Price for the shares of the
Ordinary Shares purchased pursuant to each Purchase Contract evidenced hereby
either by effecting a Cash Settlement, an
B-6
Early Settlement or, if applicable, a Cash Merger Early Settlement of each such
Purchase Contract or by applying a principal amount of the Pledged Treasury
Securities underlying such Holder's Treasury Unit equal to the Stated Amount of
such Purchase Contract to the purchase of the Ordinary Shares. A Holder of
Treasury Units who on or prior to 5:00 p.m. (New York City time) on the fifth
Business Day prior to the Purchase Contract Settlement Date, does not make an
effective Early Settlement shall pay the Purchase Price, less the amount of any
Deferred Contract Adjustment Payments payable to such Holder, for the shares of
Ordinary Shares to be issued under the related Purchase Contract from the
proceeds of the Pledged Treasury Securities.
The Company shall not be obligated to issue any shares of Ordinary Shares
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment of the aggregate purchase price for
the shares of Ordinary Shares to be purchased thereunder in the manner set forth
in the Purchase Contract Agreement.
The Company has the right to defer payment of all or part of the Contract
Adjustment Payments in respect of each Purchase Contract until no later than the
Purchase Contract Settlement Date (or in the event of an effective Early
Settlement or Cash Merger Early Settlement, the Early Settlement Date or Cash
Merger Early Settlement Date, as the case may be) as set forth in the Purchase
Contract Agreement. If the Company so elects to defer Contract Adjustment
Payments, the Company shall pay additional Contract Adjustment Payments on such
deferred installments of Contract Adjustment Payments at a rate equal to ______%
per annum, compounding on each succeeding Payment Date, until such deferred
installments are paid. In the event that the Company elects to defer the payment
of Contract Adjustment Payments on the Purchase Contracts until the Purchase
Contract Settlement Date (or, in the event of an effective Early Settlement or
Cash Merger Early Settlement, the Early Settlement Date or Cash Merger Early
Settlement Date, as the case may be), each Holder will receive on the Purchase
Contract Settlement Date, Early Settlement Date or Cash Merger Early Settlement
Date, as applicable, the aggregate amount of Deferred Contract Adjustment
Payments to the extent such fees are not deducted from the Settlement Price in
the case of a Cash Settlement or any Early Settlement or Cash Merger Early
Settlement as set forth in the Purchase Contract Agreement.
The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Contract Adjustment
Payments, shall immediately and automatically terminate, without the necessity
of any notice or action by any Holder, the Purchase Contract Agent or the
Company, if, on or prior to the Purchase Contract Settlement Date, a Termination
Event shall have occurred. Upon the occurrence of a Termination Event, the
Company shall promptly but in no event later than two Business Days thereafter
give written notice to the Purchase Contract Agent, the Collateral Agent and the
Holders, at their addresses as they appear in the Security Register. Upon and
after the occurrence of a Termination Event, the Collateral Agent shall release
the Pledged Treasury Securities (as defined in the Pledge Agreement) forming a
part of each Treasury Unit. A Treasury Unit shall thereafter represent the right
to receive the Proceeds of the Treasury Security forming a part of such Treasury
Unit, in accordance with the terms of the Purchase Contract Agreement and the
Pledge Agreement.
The Treasury Units Certificates are issuable only in registered form and
only in denominations of a single Treasury Unit and any integral multiple
thereof. The transfer of any
B-7
Treasury Units Certificate will be registered and Treasury Units Certificates
may be exchanged as provided in the Purchase Contract Agreement. The Security
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents permitted by the Purchase Contract
Agreement. No service charge shall be required for any such registration of
transfer or exchange, but the Company and the Purchase Contract Agent may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith. A Holder who elects to substitute Notes,
for Treasury Securities, thereby recreating Corporate Units, shall be
responsible for any fees or expenses associated therewith. Except as provided in
the Purchase Contract Agreement, for so long as the Purchase Contract underlying
a Treasury Unit remains in effect, such Treasury Unit shall not be separable
into its constituent parts, and the rights and obligations of the Holder of such
Treasury Unit in respect of the Treasury Security and the Purchase Contract
constituting such Treasury Unit may be transferred and exchanged only as a
Treasury Unit.
Unless the Treasury Portfolio has replaced the Notes as a component of
the Corporate Units and subject to the conditions set forth in the Purchase
Contract Agreement, a Holder of Treasury Units may recreate, at any time prior
to 5:00 p.m. (New York City time) on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, Corporate Units by delivering
to the Securities Intermediary Notes with an aggregate principal amount, equal
to the aggregate principal amount at maturity of the Pledged Treasury Securities
in exchange for the release of such Pledged Treasury Securities in accordance
with the terms of the Purchase Contract Agreement and the Pledge Agreement. From
and after such substitution, the Holder's Units shall be referred to as a
"Corporate Unit". Any such creation of Corporate Units may be effected only in
multiples of 40 Treasury Units for 40 Corporate Units.
The Company shall pay, on each Payment Date, the Contract Adjustment
Payments payable in respect of each Purchase Contract to the Person in whose
name the Treasury Units Certificate evidencing such Purchase Contract is
registered at the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments will be payable at the office of the Purchase
Contract Agent in New York City or, at the option of the Holder, by check mailed
to the address of the Person entitled thereto at such address as it appears on
the Security Register.
The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Contract Adjustment
Payments, shall immediately and automatically terminate, without the necessity
of any notice or action by any Holder, the Purchase Contract Agent or the
Company, if, on or prior to the Purchase Contract Settlement Date, a Termination
Event shall have occurred. Upon the occurrence of a Termination Event, the
Company shall promptly but in no event later than two Business Days thereafter
give written notice to the Purchase Contract Agent, the Collateral Agent and the
Holders, at their addresses as they appear in the Security Register. Upon and
after the occurrence of a Termination Event, the Collateral Agent shall release
the Treasury Securities from the Pledge in accordance with the provisions of the
Pledge Agreement. A Treasury Unit shall thereafter represent the right to
receive the interest in the Treasury Security forming a part of such Treasury
Unit, in accordance with the terms of the Purchase Contract Agreement and the
Pledge Agreement.
B-8
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
underlying Units may be settled early ("Early Settlement") as provided in the
Purchase Contract Agreement. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contract evidenced by this Certificate,
the Holder of this Treasury Units Certificate shall deliver to the Purchase
Contract Agent at the Corporate Trust Office an Election to Settle Early form
set forth below duly completed and accompanied by payment in the form of
immediately available funds payable to the order of the Company in an amount
(the "Early Settlement Amount") equal to:
(i) the sum of (A) the product of (I) the Stated Amount times (II)
the number of Purchase Contracts with respect to which the Holder has
elected to effect Early Settlement, plus (B) if such delivery is made
with respect to any Purchase Contracts during the period from the close
of business on any Record Date next preceding any Payment Date to the
opening of business on such Payment Date, an amount equal to the Contract
Adjustment Payments (including any Deferred Contract Adjustment Payments)
payable on such Payment Date with respect to such Purchase Contracts,
less
(ii) the amount of any Deferred Contract Adjustment Payments
payable to such Holder as a result of such Early Settlement.
Upon Early Settlement of Purchase Contracts by a Holder of the related
Units, the Pledged Treasury Securities underlying such Units shall be released
from the Pledge as provided in the Pledge Agreement and the Holder shall be
entitled to receive a number of shares of Ordinary Shares on account of each
Purchase Contract forming part of a Treasury Unit as to which Early Settlement
is effected equal to ______ shares of Ordinary Shares per Purchase Contract (the
"Early Settlement Rate"). The Early Settlement Rate shall be adjusted in the
same manner and at the same time as the Settlement Rate is adjusted as provided
in Section 5.04 of the Purchase Contract Agreement.
Upon the occurrence of a Cash Merger, a Holder of Treasury Units may
effect Cash Merger Early Settlement of the Purchase Contract underlying such
Treasury Units pursuant to the terms of Section 5.04(b)(2) of the Purchase
Contract Agreement. Upon Cash Merger Early Settlement of Purchase Contracts by a
Holder of the related Treasury Units, the Pledged Treasury Securities underlying
such Treasury Units shall be released from the Pledge as provided in the Pledge
Agreement.
Upon registration of transfer of this Treasury Units Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Purchase Contract Agent
pursuant to the Purchase Contract Agreement), under the terms of the Purchase
Contract Agreement and the Purchase Contracts evidenced hereby and the
transferor shall be released from the obligations under the Purchase Contracts
evidenced by this Treasury Units Certificate. The Company covenants and agrees,
and the Holder, by its acceptance hereof, likewise covenants and agrees, to be
bound by the provisions of this paragraph.
The Holder of this Treasury Units Certificate, by its acceptance hereof,
authorizes the Purchase Contract Agent to enter into and perform the related
Purchase Contracts forming part of
B-9
the Treasury Units evidenced hereby on its behalf as its attorney-in-fact,
expressly withholds any consent to the assumption (i.e., affirmance) of the
Purchase Contracts by the Company or its trustee in the event that the Company
becomes the debtor under the Bankruptcy Code or subject to other similar state
or Federal law providing for reorganization or liquidation, agrees to be bound
by the terms and provisions thereof, covenants and agrees to perform its
obligations under such Purchase Contracts, consents to the provisions of the
Purchase Contract Agreement, authorizes the Purchase Contract Agent to enter
into and perform the Purchase Contract Agreement and the Pledge Agreement on its
behalf as its attorney-in-fact, and consents to the Pledge of the Treasury
Securities underlying this Treasury Units Certificate pursuant to the Pledge
Agreement. The Holder further covenants and agrees, that, to the extent and in
the manner provided in the Purchase Contract Agreement and the Pledge Agreement,
but subject to the terms thereof, payments in respect to the aggregate principal
amount of the Pledged Treasury Securities on the Purchase Contract Settlement
Date shall be paid by the Collateral Agent to the Company in satisfaction of
such Holder's obligations under such Purchase Contract and such Holder shall
acquire no right, title or interest in such payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York, without giving
effect to the conflicts of law provisions thereof.
Prior to due presentment of this Certificate for registration or
transfer, the Company, the Purchase Contract Agent and its Affiliates and any
agent of the Company or the Purchase Contract Agent may treat the Person in
whose name this Treasury Units Certificate is registered as the owner of the
Treasury Units evidenced hereby for the purpose of receiving payments of
interest on the Treasury Securities, receiving payments of Contract Adjustment
Payments (subject to any applicable record date), performance of the Purchase
Contracts and for all other purposes whatsoever, whether or not any payments in
respect thereof be overdue and notwithstanding any notice to the contrary, and
neither the Company, the Purchase Contract Agent nor any such agent shall be
affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Ordinary
Shares.
A copy of the Purchase Contract Agreement is available for inspection at
the offices of the Purchase Contract Agent.
B-10
ABBREVIATIONS
The following abbreviations, when used in the inscription on the
face of this instrument, shall be construed as though they were written out
in full according to applicable laws or regulations:
TEN COM: as tenants in common
UNIF GIFT MIN ACT: _________________________ Custodian _________________________
(cust) (minor)
Under Uniform Gifts to Minors Act of
TENANT: as tenants by the entireties
JT TEN: as joint tenants with right of survivorship and not as tenants in common
Additional abbreviations may also be used though not in the above list.
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
--------------------------------------------------------------------------------
(Please insert Social Security or Taxpayer I.D. or other
Identifying Number of Assignee)
--------------------------------------------------------------------------------
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Corporate Units Certificates and all rights thereunder, hereby
irrevocably constituting and appointing attorney ______, to transfer said
Corporate Units Certificates on the books of Scottish Annuity & Life Holdings,
Ltd., with full power of substitution in the premises.
Dated: Signature
------------------------ ----------------------------------
NOTICE: The signature to this assignment
must correspond with the name as it appears
upon the face of the within Corporate Units
Certificates in every particular, without
alteration or enlargement or any change
whatsoever.
Signature Guarantee:
---------------------------------
B-11
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Ordinary
Shares deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Treasury Units evidenced
by this Treasury Units Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional share, to the undersigned at
the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated:________________________ Signature
Signature Guarantee:_______________________
(if assigned to another person)
If shares are to be registered in
the name of and delivered to a REGISTERED HOLDER
Person other than the Holder,
please (i) print such Person's name
and address and (ii) provide a Please print name and address of
guarantee of your signature: Registered Holder:
____________________________________ _________________________________________
Name Name
____________________________________ _________________________________________
Address Address
____________________________________ _________________________________________
____________________________________ _________________________________________
____________________________________ _________________________________________
Social Security or other Taxpayer
Identification Number, if any
_________________________________________
B-12
ELECTION TO SETTLE EARLY/CASH MERGER EARLY SETTLEMENT
The undersigned Holder of this Treasury Units Certificate hereby
irrevocably exercises the option to effect [Early Settlement] [Cash Merger Early
Settlement upon a Cash Merger] in accordance with the terms of the Purchase
Contract Agreement with respect to the Purchase Contracts underlying the number
of Treasury Units evidenced by this Treasury Units Certificate specified below.
The option to effect [Early Settlement] [Cash Merger Early Settlement] may be
exercised only with respect to Purchase Contracts underlying Treasury Units with
an aggregate Stated Amount equal to $1,000 or an integral multiple thereof. The
undersigned Holder directs that a certificate for shares of Ordinary Shares or
other securities deliverable upon such [Early Settlement] [Cash Merger Early
Settlement] be registered in the name of, and delivered, together with a check
in payment for any fractional share and any Treasury Units Certificate
representing any Treasury Units evidenced hereby as to which Cash Merger Early
Settlement of the related Purchase Contracts is not effected, to the undersigned
at the address indicated below unless a different name and address have been
indicated below. Pledged Treasury Securities deliverable upon such [Early
Settlement] [Cash Merger Early Settlement] will be transferred in accordance
with the transfer instructions set forth below. If shares are to be registered
in the name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.
Dated ____________________________ Signature_______________________________
Signature Guarantee: ______________________________________
B-13
Number of Units evidenced hereby as to which [Early Settlement] [Cash
Merger Early Settlement] of the related Purchase Contracts is being elected:
If shares of Ordinary Shares or REGISTERED HOLDER
Corporate Units Certificates are to be
registered in the name of and
delivered to and Pledged Notes or
the Applicable Ownership Interests
in the Treasury Portfolio, as the case
may be, are to be transferred to a
Person other than the Holder, please
print such Person's name and address:
____________________________________ _________________________________________
Name Name
____________________________________ _________________________________________
Address Address
____________________________________ _________________________________________
____________________________________ _________________________________________
____________________________________ _________________________________________
Social Security or other Taxpayer
Identification Number, if any
_________________________________________
Transfer Instructions for Pledged Notes or the Applicable Ownership Interests in
the Treasury Portfolio, as the case may be, transferable upon [Early Settlement]
[Cash Merger Early Settlement] or a Termination Event:
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
B-14
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The initial number of Treasury Units of this Global Certificate is 0. The
following increases or decreases in this Global Certificate have been made:
-------------------- ------------------------ ----------------------- ------------------------ -----------------------
Number or Corporate
Amount of increase Amount of decrease Units evidenced by
in Number of in Number of this Global Signature of
Corporate Units Corporate Units Certificate authorized signatory
evidenced by the evidenced by the following such of Purchase Contract
Date Global Certificate Global Certificate decrease or increase Agent
-------------------- ------------------------ ----------------------- ------------------------ -----------------------
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B-15
EXHIBIT C
INSTRUCTION TO PURCHASE CONTRACT AGENT
The Purchase Contract Agent
(address)
Re: [______ Corporate Units] [______ Treasury Units] of Scottish Annuity
& Life Holdings, Ltd., a holding company organized under the laws of the Cayman
Islands (the "Company").
The undersigned Holder hereby notifies you that it has delivered to
______, as Securities Intermediary, for credit to the Collateral Account,
$______ aggregate principal amount of [Notes] [Treasury Securities] in exchange
for the [Pledged Notes] [Pledged Treasury Securities] held in the Collateral
Account, in accordance with the Pledge Agreement, dated as of ______, 200__ (the
"Pledge Agreement"; unless otherwise defined herein, terms defined in the Pledge
Agreement are used herein as defined therein), between you, the Company, the
Collateral Agent, the Custodial Agent and the Securities Intermediary. The
undersigned Holder has paid all applicable fees and expenses relating to such
exchange. The undersigned Holder hereby instructs you to instruct the Collateral
Agent to release to you on behalf of the undersigned Holder the [Pledged Notes]
[Pledged Treasury Securities] related to such [Corporate Units] [Treasury
Units].
Date ________________________ Signature _________________________________
Signature Guarantee:_______________________
Please print name and address of Registered Holder:
Name ____________________________________________
Social Security or other Taxpayer
Identification Number, if any
Address
_____________________________________
_____________________________________
_____________________________________
C-2
EXHIBIT D
NOTICE FROM PURCHASE CONTRACT AGENT
TO HOLDERS
(Transfer of Collateral upon Occurrence of a Termination Event)
[HOLDER]
Attention:
Telecopy:
Re: [______ Corporate Units] [______ Treasury Units] of Scottish
Annuity & Life Holdings, Ltd., a holding company organized under
the laws of the Cayman Islands (the "Company")
Please refer to the Purchase Contract Agreement, dated as of ______,
200__ (the "Purchase Contract Agreement"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and the undersigned, as Purchase Contract Agent and as
attorney-in-fact for the holders of Corporate Units and [Applicable Ownership
Interests (as specified in clause (i) of the definition of such term) and]
Treasury Units from time to time.
We hereby notify you that a Termination Event has occurred and that [the
Notes] [Applicable Ownership Interests (as specified in clause (i) of the
definition of such term) in the Treasury Portfolio] [the Treasury Securities]
compromising a portion of your ownership interest in ______ [Corporate Units]
[Treasury Units] have been released and are being held by us for your account
pending receipt of transfer instructions with respect to such [Notes][Treasury
Securities] (the "Released Securities").
Pursuant to Section 3.15 of the Purchase Contract Agreement, we hereby
request written transfer instructions with respect to the Released Securities.
Upon receipt of your instructions and upon transfer to us of your [Corporate
Units][Treasury Units] effected through book-entry or by delivery to us of your
[Corporate Units Certificate][Treasury Units Certificate], we shall transfer the
Released Securities by book-entry transfer or other appropriate procedures, in
accordance with your instructions. In the event you fail to effect such transfer
or delivery, the Released Securities and any distributions thereon, shall be
held in our name, or a nominee in trust for your benefit, until such time as
such [Corporate Units][Treasury Units] are transferred or your [Corporate Units
Certificate] [Treasury Units Certificate] is surrendered or satisfactory
evidence is provided that such [Corporate Units Certificate][Treasury Units
Certificate] has been destroyed, lost or stolen, together with any
indemnification that we or the Company may require.
Date By: ____________________________________
as the Purchase Contract Agent
________________________________________
Name:
Title: Authorized Signatory
EXHIBIT E
NOTICE TO SETTLE BY CASH
The Purchase Contract Agent
Attn:
Re: ______ Corporate Units of Scottish Annuity & Life Holdings, Ltd.,
a holding company organized under the laws of the Cayman Islands
(the "Company")
The undersigned Holder hereby irrevocably notifies you in accordance with
Section 5.02 of the Purchase Contract Agreement, dated as of ______, 200__ (the
"Purchase Contract Agreement"; unless otherwise defined herein, terms defined in
the Purchase Contract Agreement are used herein as defined therein), between the
Company and you, as Purchase Contract Agent and as Attorney-in-Fact for the
Holders of the Purchase Contracts, that such Holder has elected to pay to the
Securities Intermediary for deposit in the Collateral Account, prior to or on
11:00 a.m. (New York City time) on the fourth 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),
$______ as the Purchase Price for the shares of Ordinary Shares issuable to such
Holder by the Company with respect to ______ Purchase Contracts on the Purchase
Contract Settlement Date. The undersigned Holder hereby instructs you to notify
promptly the Collateral Agent of the undersigned Holder's election to make such
Cash Settlement with respect to the Purchase Contracts related to such Holder's
Corporate Units.
Date ________________________ Signature _________________________________
Signature Guarantee:_______________________
Please print name and address of Registered Holder:
E-1
EXHIBIT F
NOTICE FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT
(Settlement of Purchase Contract through Remarketing)
The Collateral Agent
Re: ______ Corporate Units of Scottish Annuity & Life Holdings, Ltd.,
a holding company organized under the laws of the Cayman Islands
(the "Company")
Please refer to the Purchase Contract Agreement, dated as of ______,
200__ (the "Purchase Contract Agreement"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and the undersigned, as Purchase Contract Agent and as
attorney-in-fact for the Holders of Corporate Units from time to time.
In accordance with Section 5.02 of the Purchase Contract Agreement and,
based on notices of [Early Settlements][Cash Settlements] received from Holders
of Corporate Units as of 5:00 p.m. (New York City time), on the fifth Business
Day immediately preceding the ______Remarketing Date, we hereby notify you that
an aggregate principal amount of $______ Notes is to be tendered for purchase in
the Remarketing.
Date By: ____________________________________
as the Purchase Contract Agent
________________________________________
Name:
Title: Authorized Signatory
F-1