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EXHIBIT 4.6
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LINCOLN NATIONAL CORPORATION
AND
THE FIRST NATIONAL BANK OF CHICAGO,
AS PURCHASE CONTRACT AGENT
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PURCHASE CONTRACT AGREEMENT
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DATED AS OF AUGUST 14, 1998
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TABLE OF CONTENTS
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RECITALS ....................................................................................................... 1
ARTICLE I....................................................................................................... 1
Definitions and Other Provisions of General Applications........................................................ 1
Section 1.1. Definitions................................................................................... 1
Section 1.2. Compliance Certificates and Opinions.......................................................... 9
Section 1.3. Form of Documents Delivered to Agent.......................................................... 10
Section 1.4. Acts of Holders; Record Dates................................................................. 10
Section 1.5. Notices....................................................................................... 11
Section 1.6. Notice to Holders; Waiver..................................................................... 12
Section 1.7. Effect of Headings and Table of Contents...................................................... 13
Section 1.8. Successors and Assigns........................................................................ 13
Section 1.9. Separability Clause........................................................................... 13
Section 1.10. Benefits of Agreement......................................................................... 13
Section 1.11. Governing Law................................................................................. 14
Section 1.12. Legal Holidays................................................................................ 14
Section 1.13. Counterparts.................................................................................. 14
Section 1.14. Inspection of Agreement....................................................................... 14
ARTICLE II...................................................................................................... 14
Certificate Forms............................................................................................... 14
Section 2.1. Forms of Certificates Generally............................................................... 14
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TABLE OF CONTENTS
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Section 2.2. Form of Agent's Certificate of Authentication................................................. 15
ARTICLE III..................................................................................................... 16
Section 3.1. Title and Terms; Denominations................................................................ 16
Section 3.2. Rights and Obligations Evidenced by the Certificates. ........................................ 16
Section 3.3. Execution, Authentication, Delivery and Dating. .............................................. 17
Section 3.4. Temporary Certificates........................................................................ 17
Section 3.5. Registration; Registration of Transfer and Exchange. ......................................... 18
Section 3.6. Book-Entry Interests.......................................................................... 19
Section 3.7. Notices to Holders............................................................................ 20
Section 3.8. Appointment of Successor Clearing Agency...................................................... 20
Section 3.9. Definitive Certificates....................................................................... 20
Section 3.10. Mutilated, Destroyed, Lost and Stolen......................................................... 20
Section 3.11. Persons Deemed Owners......................................................................... 22
Section 3.12. Cancellation.................................................................................. 22
Section 3.13. Establishment or Reestablishment of Growth PRIDES............................................. 23
Section 3.14. Establishment or Reestablishment of Income PRIDES............................................. 24
Section 3.15. Transfer of Collateral upon Occurrence of Termination Event. ................................. 25
Section 3.16. No Consent to Assumption...................................................................... 26
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TABLE OF CONTENTS
(CONTINUED)
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ARTICLE IV...................................................................................................... 26
The Preferred Securities........................................................................................ 26
Section 4.1. Payment of Distribution; Rights to Distributions Preserved; Distribution
Rate Reset; Notice............................................................................ 26
Section 4.2. Notice and Voting............................................................................. 28
Section 4.3. Distribution of Debentures; Tax Event Redemption. ............................................ 28
ARTICLE V....................................................................................................... 29
The Purchase Contracts.......................................................................................... 29
Section 5.1. Purchase of Shares of Common Stock............................................................ 29
Section 5.2. Contract Adjustment Payments.................................................................. 31
Section 5.3. Deferral of Payment Dates For Contract Adjustment Payments. .................................. 32
Section 5.4. Payment of Purchase Price..................................................................... 33
Section 5.5. Issuance of Shares of Common Stock............................................................ 37
Section 5.6. Adjustment of Settlement Rate................................................................. 38
Section 5.7. Notice of Adjustments and Certain Other Events. .............................................. 43
Section 5.8. Termination Event; Notice..................................................................... 43
Section 5.9. Early Settlement.............................................................................. 44
Section 5.10. No Fractional Shares.......................................................................... 46
Section 5.11. Charges and Taxes............................................................................. 46
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TABLE OF CONTENTS
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ARTICLE VI...................................................................................................... 47
Remedies ....................................................................................................... 47
Section 6.1. Unconditional Right of Holders to Receive Contract Adjustment Payments
and to Purchase Common Stock.................................................................. 47
Section 6.2. Restoration of Rights and Remedies............................................................ 47
Section 6.3. Rights and Remedies Cumulative................................................................ 47
Section 6.4. Delay or Omission Not Waiver.................................................................. 47
Section 6.5. Undertaking for Costs......................................................................... 48
Section 6.6. Waiver of Stay or Extension Laws.............................................................. 48
ARTICLE VII..................................................................................................... 48
The Agent....................................................................................................... 48
Section 7.1. Certain Duties and Responsibilities........................................................... 48
Section 7.2. Notice of Default............................................................................. 49
Section 7.3. Certain Rights of Agent....................................................................... 49
Section 7.4. Not Responsible for Recitals or Issuance of Securities. ...................................... 50
Section 7.5. May Hold Securities........................................................................... 50
Section 7.6. Money Held in Custody......................................................................... 51
Section 7.7. Compensation and Reimbursement................................................................ 51
Section 7.8. Corporate Agent Required; Eligibility......................................................... 51
Section 7.9. Resignation and Removal; Appointment of Successor............................................. 52
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TABLE OF CONTENTS
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Section 7.10. Acceptance of Appointment by Successor........................................................ 53
Section 7.11. Merger, Conversion, Consolidation or Succession to Business. ................................. 53
Section 7.12. Preservation of Information; Communications to Holders. ...................................... 54
Section 7.13. No Obligations of Agent....................................................................... 54
Section 7.14. Tax Compliance................................................................................ 54
ARTICLE VIII.................................................................................................... 55
Supplemental Agreements......................................................................................... 55
Section 8.1. Supplemental Agreements Without Consent of Holders. .......................................... 55
Section 8.2. Supplemental Agreements with Consent of Holders. ............................................. 55
Section 8.3. Execution of Supplemental Agreements.......................................................... 56
Section 8.4. Effect of Supplemental Agreements............................................................. 57
Section 8.5. Reference to Supplemental Agreements.......................................................... 57
ARTICLE IX...................................................................................................... 57
Consolidation, Merger, Sale or Conveyance ...................................................................... 57
Section 9.1. Covenant Not to Merge, Consolidate, Sell or Convey Property Except
Under Certain Conditions...................................................................... 57
Section 9.2. Rights and Duties of Successor Corporation.................................................... 57
Section 9.3. Opinion of Counsel Given to Agent............................................................. 58
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TABLE OF CONTENTS
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ARTICLE X....................................................................................................... 58
Covenants....................................................................................................... 58
Section 10.1. Performance Under Purchase Contracts.......................................................... 58
Section 10.2. Maintenance of Office or Agency............................................................... 58
Section 10.3. Company to Reserve Common Stock............................................................... 59
Section 10.4. Covenants as to Common Stock.................................................................. 59
EXHIBIT A....................................................................................................... 61
Form of Face of Income PRIDES Certificate ...................................................................... 61
EXHIBIT B....................................................................................................... 78
Form of Face of Growth PRIDES Certificate ...................................................................... 78
EXHIBIT C....................................................................................................... 92
Instruction to Collateral Agent................................................................................. 92
EXHIBIT D
Instruction to Purchase Contract Agent ......................................................................... 94
EXHIBIT E
Notice to Settle By Separate Cash............................................................................... ▇▇
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▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ AGREEMENT, dated as of August 14, 1998 between
Lincoln National Corporation, an Indiana corporation (the "Company"), and The
First National Bank of Chicago, a national banking association, acting as
purchase contract agent for the Holders of Securities from time to time (the
"Agent").
RECITALS
The Company has duly authorized the execution and delivery of this
Agreement and the Certificates evidencing the Securities.
All things necessary to make the Purchase Contracts, when the
Certificates are executed by the Company and authenticated, executed on behalf
of the Holders and delivered by the Agent, as provided in this Agreement, the
valid obligations of the Company, and to constitute these presents a valid
agreement of the Company, in accordance with its terms, have been done.
WITNESSETH:
For and in consideration of the premises and the purchase of the
Securities by the Holders thereof, it is mutually agreed as follows:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATIONS
SECTION 1.1. DEFINITIONS.
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings assigned
to them in this Article and include the plural as well as the singular; and
nouns and pronouns of the masculine gender include the feminine and neuter
genders;
(b) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States;
(c) the words "herein," "hereof" and "hereunder" and other words
of similar import refer to this Agreement as a whole and not to any particular
Article, Section or other subdivision;
(d) the following terms have the meanings given to them in the
Trust Agreement: (i) Applicable Ownership Interest; (ii) Applicable Principal
Amount; (iii) Authorized Newspaper; (iv) Bankruptcy Event; (v) Indenture, (vi)
Investment Company Event; (vii) Liquidation
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Distribution; (viii) Guarantee; (ix) Primary Treasury Dealer; (x) Quotation
Agent; (xi) Redemption Amount; (xii) Redemption Price; (xiii) Reset Agent; (xiv)
Reset Announcement Date; (xv) Reset Rate; (xvi) Reset Spread; (xvii) Tax Event;
(xviii) Tax Event Redemption; (xix) Tax Event Redemption Date; (xx) Two-Year
Benchmark Treasury; (xxi) Treasury Portfolio; and (xxii) Treasury Portfolio
Purchase Price; and
(e) the following terms have the meanings given to them in this
Section 1.1(e).
"Act" when used with respect to any Holder, has the meaning specified
in Section 1.4.
"Affiliate"has the same meaning as given to that term in Rule 405 of
the Securities Act or any successor rule thereunder.
"Agent" means the Person named as the "Agent" in the first paragraph of
this instrument until a successor Agent shall have become such pursuant to the
applicable provisions of this Agreement, and thereafter "Agent" shall mean such
Person.
"Agreement" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Applicable Market Value" has the meaning specified in Section 5.1.
"Bankruptcy Code" means title 11 of the United States Code, or any
other law of the United States that from time to time provides a uniform system
of bankruptcy laws.
"Beneficial Owner" means, with respect to a Book-Entry Interest, a
Person who is the beneficial owner of such Book-Entry Interest as reflected on
the books of the Clearing Agency or on the books of a Person maintaining an
account with such Clearing Agency (directly as a Clearing Agency Participant or
as an indirect participant, in each case in accordance with the rules of such
Clearing Agency).
"Board of Directors" means the board of directors of the Company or a
duly authorized committee of that board.
"Board Resolution" means one or more resolutions of the Board of
Directors, a copy of which has been certified by the Secretary or an Assistant
Secretary of the Company to have been duly adopted by the Board of Directors and
to be in full force and effect on the date of such certification and delivered
to the Agent.
"Book-Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 3.6.
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"Business Day" means any day other than a Saturday, Sunday or any other
day on which banking institutions in ▇▇▇ ▇▇▇▇ ▇▇▇▇ (▇▇ ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇)
are permitted or required by any applicable law to close.
"Cash Settlement" has the meaning set forth in Section 5.4(a)(i).
"Certificate" means an Income PRIDES Certificate or a Growth PRIDES
Certificate.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as a
depositary for the Securities and in whose name, or in the name of a nominee of
that organization, shall be registered a Global Certificate and which shall
undertake to effect book entry transfers and pledges of the Securities.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Price" has the meaning specified in Section 5.1.
"Collateral" has the meaning specified in Section 2.1 of the Pledge
Agreement.
"Collateral Agent" means The Chase Manhattan Bank, as Collateral Agent
under the Pledge Agreement until a successor Collateral Agent shall have become
such pursuant to the applicable provisions of the Pledge Agreement, and
thereafter "Collateral Agent" shall mean the Person who is then the Collateral
Agent thereunder.
"Collateral Substitution" has the meaning specified in Section 3.13.
"Common Stock" means the Common Stock, no par value, of the Company.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such pursuant
to the applicable provision of this Agreement, and thereafter "Company" shall
mean such successor.
"Contract Adjustment Payments" means the amount payable by the Company
in respect of each Purchase Contract relating to Income PRIDES and Growth
PRIDES, respectively, equal to 1.35% and 1.85%, respectively, per annum of the
Stated Amount, computed on the basis of a 360 day year of twelve 30 day months,
plus any Deferred Contract Adjustment Payments accrued pursuant to Section 5.2.
"Corporate Trust Office" means the principal corporate trust office of
the Agent at which, at any particular time, its corporate trust business shall
be administered, which office at the date hereof is located at ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, Attention:
Corporate Trust Services Division.
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"Coupon Rate" means the percentage rate per annum at which each
Debenture will bear interest initially.
"Current Market Price" has the meaning specified in Section 5.6(a)(8).
"Debentures" means the series of debentures of the Company designated
the 6.40% Junior Subordinated Debentures due August 15, 2003, to be issued under
the Junior Subordinated Indenture as of May 1, 1996.
"Deferred Contract Adjustment Payments" has the meaning specified in
Section 5.3.
"Depositary" means, initially, DTC until another Clearing Agency
becomes its successor.
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"Early Settlement" has the meaning specified in Section 5.9(a).
"Early Settlement Amount" has the meaning specified in Section 5.9(a).
"Early Settlement Date" has the meaning specified in Section 5.9(a).
"Early Settlement Rate" has the meaning specified in Section 5.9(b).
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time, and the
rules and regulations promulgated thereunder.
"Expiration Date" has the meaning specified in Section 1.4.
"Expiration Time" has the meaning specified in Section 5.6(a)(6).
"Failed Remarketing" has the meaning specified in Section 5.4(b).
"Global Preferred Security Certificate" means a certificate evidencing
the rights and obligations of a Holder in respect of the number of Preferred
Securities specified on such certificate and which is registered in the name of
a Clearing Agency or a nominee thereof.
"Global Certificate" means a Certificate that evidences all or part of
the Securities and is registered in the name of a Depositary or a nominee
thereof.
"Growth PRIDES" means the collective rights and obligations of a holder
of a Growth PRIDES Certificate in respect of such Treasury Securities, subject
in each case to the Pledge thereof, and the related Purchase Contract.
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"Growth PRIDES Certificate" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Growth PRIDES specified
on such certificate.
"Growth PRIDES Register" and "Growth PRIDES Registrar" have the
respective meanings specified in Section 3.5.
"Holder" when used with respect to a Security, means the Person in
whose name the Security evidenced by an Income PRIDES Certificate and/or a
Growth PRIDES Certificate is registered in the related Income PRIDES Register
and/or the Growth PRIDES Register, as the case may be.
"Income PRIDES" means the collective rights and obligations of a Holder
of an Income PRIDES Certificate in respect of a Preferred Security or an
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, subject in each case to the Pledge thereof, and the related Purchase
Contract.
"Income PRIDES Certificate" means a certificate evidencing the rights
and obligations of a Holder in respect of the number of Income PRIDES specified
on such certificate.
"Income PRIDES Register" and "Income PRIDES Registrar" have the
respective meanings specified in Section 3.5.
"Indenture Trustee" means The First National Bank of Chicago, a
national banking association, as trustee under the Indenture, or any successor
thereto.
"Issuer Order" or "Issuer Request" means a written order or request
signed in the name of the Company by its Chief Executive Officer, its President
or a Vice President and by its Treasurer, an Assistant Treasurer, its Secretary
or an Assistant Secretary, and delivered to the Agent.
"NYSE" has the meaning specified in Section 5.1.
"Officer's Certificate" means a certificate of the Company signed on
its behalf by the Chief Executive Officer, the President, any Vice President,
the Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary
of the Company and delivered to the Agent.
"Opinion of Counsel" means an opinion in writing signed by legal
counsel, who may be an employee of or counsel to the Company or an Affiliate and
who shall be reasonably acceptable to the Agent.
"Outstanding Securities," with respect to any Income PRIDES or Growth
PRIDES, means, as of the date of determination, all Income PRIDES or Growth
PRIDES evidenced by Certificates theretofore authenticated, executed and
delivered under this Agreement, except:
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(i) If a Termination Event has occurred, (A) Growth PRIDES and (B)
Income PRIDES for which the Stated Amount of the related Preferred Security or
the appropriate Applicable Ownership Interest of the Treasury Portfolio, or a
Liquidation Distribution in respect of such Preferred Security, as the case may
be, has been theretofore deposited with the Agent in trust for the Holders of
such Income PRIDES;
(ii) Income PRIDES and Growth PRIDES evidenced by Certificates
theretofore cancelled by the Agent or delivered to the Agent for cancellation or
deemed cancelled pursuant to the provisions of this Agreement; and
(iii) Income PRIDES and Growth PRIDES evidenced by Certificates in
exchange for or in lieu of which other Certificates have been authenticated,
executed on behalf of the Holder and delivered pursuant to this Agreement, other
than any such Certificate in respect of which there shall have been presented to
the Agent proof satisfactory to it that such Certificate is held by a bona fide
purchaser in whose hands the Income PRIDES or Growth PRIDES evidenced by such
Certificate are valid obligations of the Company; provided, however, that in
determining whether the Holders of the requisite number of the Income PRIDES or
Growth PRIDES have given any request, demand, authorization, direction, notice,
consent or waiver hereunder, Income PRIDES or Growth PRIDES owned by the Company
or any Affiliate of the Company shall be disregarded and deemed not to be
outstanding, except that, in determining whether the Agent shall be protected in
relying upon any such request, demand, authorization, direction, notice, consent
or waiver, only Income PRIDES or Growth PRIDES which a Responsible Officer of
the Agent knows to be so owned shall be so disregarded. Income PRIDES or Growth
PRIDES so owned which have been pledged in good faith may be regarded as
Outstanding Securities if the pledgee establishes to the satisfaction of the
Agent the pledgee's right so to act with respect to such Income PRIDES or Growth
PRIDES and that the pledgee is not the Company or any Affiliate of the Company.
"Payment Date" means each February 16, May 16, August 16 and November
16, commencing November 16, 1998.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint-stock company, limited
liability company, trust, unincorporated association or government or any agency
or political subdivision thereof or any other entity of whatever nature.
"Permitted Investments" has the meaning set forth in Section 1 of the
Pledge Agreement.
"Pledge" means the pledge under the Pledge Agreement of the Preferred
Securities, the Treasury Securities or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, in each case constituting a part of the
Securities.
"Pledge Agreement" means the Pledge Agreement, dated as of the date
hereof, by and among the Company, the Collateral Agent and the Agent, on its own
behalf and as
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attorney-in-fact for the Holders from time to time of the Securities, as the
same may hereafter be amended.
"Predecessor Certificate" means a Predecessor Income PRIDES Certificate
or a Predecessor Growth PRIDES Certificate.
"Predecessor Growth PRIDES Certificate" of any particular Growth PRIDES
Certificate means every previous Growth PRIDES Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
Growth PRIDES evidenced thereby; and, for the purposes of this definition, any
Growth PRIDES Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Growth PRIDES
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Growth PRIDES
Certificate.
"Predecessor Income PRIDES Certificate" of any particular Income PRIDES
Certificate means every previous Income PRIDES Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
Income PRIDES evidenced thereby; and, for the purposes of this definition, any
Income PRIDES Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Income PRIDES
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Income PRIDES
Certificate.
"Preferred Securities" means the 6.40% Preferred Securities, Series D,
of the Trust, each having a stated liquidation amount of $25, representing
undivided beneficial interests in the assets of the Trust.
"Proceeds" has the meaning set forth in Section 1 of the Pledge
Agreement.
"Property Trustee" means The First National Bank of Chicago, as
property trustee under the Trust Agreement, or any successor thereto that is a
financial institution unaffiliated with the Company.
"Purchase Contract," when used with respect to any Security, means the
contract forming a part of such Security and obligating the Company to (i) sell
and the Holder of such Security to purchase Common Stock and (ii) pay the Holder
Contract Adjustment Payments, if any, on the terms and subject to the conditions
set forth in Article Five hereof.
"Purchase Contract Settlement Date" means August 16, 2001.
"Purchase Contract Settlement Fund" has the meaning specified in
Section 5.5.
"Purchase Price" has the meaning specified in Section 5.1.
"Purchased Shares" has the meaning specified in Section 5.6(a)(6).
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"Record Date" for the distribution and Contract Adjustment Payments, if
any, payable on any Payment Date means, as to any Global Certificate, the
Business Day next preceding such Payment Date, and as to any other Certificate,
a day selected by the Company which shall be more than one Business Day but less
than 60 Business Days prior to such Payment Date.
"Register" means the Income PRIDES Register and the Growth PRIDES
Register.
"Registrar" means the Income PRIDES Registrar and the Growth PRIDES
Registrar.
"Remarketing Agent" has the meaning specified in Section 5.4.
"Remarketing Agreement" means the Remarketing Agreement dated August
14, 1998 by and among the Company, the Trust, the Remarketing Agent and the
Purchase Contract Agent.
"Remarketing Fee" has the meaning specified in Section 5.4.
"Remarketing Underwriting Agreement" has the meaning specified in the
Remarketing Agreement.
"Reorganization Event" has the meaning specified in Section 5.6(b).
"Responsible Officer," when used with respect to the Agent, means any
officer of the Agent assigned by the Agent to administer its corporate trust
matters.
"Rights Plan" shall have the meaning specified in the Indenture.
"Security" means an Income PRIDE or a Growth PRIDE.
"Senior Indebtedness" has the meaning set forth in the Indenture.
"Settlement Rate" has the meaning specified in Section 5.1.
"Stated Amount" means $25.
"Termination Date" means the date, if any, on which a Termination Event
occurs.
"Termination Event" means a Bankruptcy Event in respect of, or the
dissolution or liquidation of, the Company.
"Threshold Appreciation Price" has the meaning specified in Section
5.1.
"TIA" means the Trust Indenture Act of 1939, as amended, or any
successor statute.
"Trading Day" has the meaning specified in Section 5.1.
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"Treasury Security" means zero-coupon U.S. Treasury Securities (CUSIP
Number 912820 BB 2) which are the principal strip of the U.S. Treasury
Securities which mature on August 15, 2001.
"Trust" means Lincoln National Capital IV, a statutory business trust
formed under the laws of the State of Delaware, or any successor thereto by
merger or consolidation.
"Trust Agreement" means the Amended and Restated Trust Agreement of
Lincoln National Capital IV, dated August 14, 1998, among the Company, as the
sponsor, the trustees named therein and the holders from time to time of
individual beneficial interests in the assets of the Trust.
"Underwriting Agreement" means the Underwriting Agreement dated August
10, 1998 among the Company, the Trust, and the Underwriters named therein.
"Vice President" means any vice president, whether or not designated by
a number or a word or words added before or after the title "vice president."
SECTION 1.2. COMPLIANCE CERTIFICATES AND OPINIONS.
Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Agent to take any action under any
provision of this Agreement, the Company shall furnish to the Agent an Officer's
Certificate stating that all conditions precedent, if any, provided for in this
Agreement relating to the proposed action have been complied with and, if
reasonably requested by the Agent, an Opinion of Counsel stating that, in the
opinion of such counsel, all such conditions precedent, if any, have been
complied with, except that in the case of any such application or request as to
which the furnishing of such documents is specifically required by any provision
of this Agreement relating to such particular application or request, no
additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition
or covenant provided for in this Agreement shall include:
(1) a statement that each Person signing such certificate or
opinion has read such covenant or condition and the definitions herein relating
thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;
(3) a statement that, in the opinion of each such Person, he
or she or it has made such examination or investigation as is necessary to
enable such individual to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
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(4) a statement as to whether, in the opinion of each such
Person, such condition or covenant has been complied with.
SECTION 1.3. FORM OF DOCUMENTS DELIVERED TO AGENT.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of the Company may be based, insofar as it
relates to legal matters, upon a certificate or opinion of, or representations
by, counsel, unless the Company knows, or in the exercise of reasonable care
should know, that the certificate or opinion or representations with respect to
the matters upon which his certificate or opinion is based are erroneous. Any
such certificate or Opinion of Counsel may be based, insofar as it relates to
factual matters, upon a certificate or opinion of, or representations by, the
Company stating that the information with respect to such factual matters is in
the possession of the Company unless the Person giving such certificate or
Opinion of Counsel knows, or in the exercise of reasonable care should know,
that the certificate or opinion or representations with respect to such matters
are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
SECTION 1.4. ACTS OF HOLDERS; RECORD DATES.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Agent and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Agreement and (subject to Section 7.1) conclusive in favor of the Agent and the
Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner which the Agent deems
sufficient.
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(c) The ownership of Securities shall be proved by the Income PRIDES
Register or the Growth PRIDES Register, as the case may be.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Certificate shall bind every future
Holder of the same Certificate and the Holder of every Certificate issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Agent or the
Company in reliance thereon, whether or not notation of such action is made upon
such Certificate.
(e) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities entitled to give, make or take
any request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Agreement to be given, made or taken by
Holders of Securities. If any record date is set pursuant to this paragraph, the
Holders of the Outstanding Income PRIDES and the Outstanding Growth PRIDES, 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 Income PRIDES or the Growth PRIDES,
as the case may be, whether or not such Holders remain Holders after such record
date; provided that no such action shall be effective hereunder unless taken on
or prior to the applicable Expiration Date by Holders of the requisite number of
Outstanding Securities on such record date. Nothing in this paragraph shall be
construed to prevent the Company from setting a new record date for any action
for which a record date has previously been set pursuant to this paragraph
(whereupon the record date previously set shall automatically and with no action
by any Person be cancelled and of no effect), and nothing in this paragraph
shall be construed to render ineffective any action taken by Holders of the
requisite number of Outstanding Securities on the date such action is taken.
Promptly after any record date is set pursuant to this paragraph, the Company,
at its own expense, shall cause notice of such record date, the proposed action
by Holders and the applicable Expiration Date to be given to the Agent in
writing and to each Holder of Securities in the manner set forth in Section 1.6.
With respect to any record date set pursuant to this Section, the Company
may designate any date as the "Expiration Date" and from time to time may change
the Expiration Date to any earlier or later day; provided that no such change
shall be effective unless notice of the proposed new Expiration Date is given to
the Agent in writing, and to each Holder of Securities in the manner set forth
in Section 1.6, on or prior to the existing Expiration Date. If an Expiration
Date is not designated with respect to any record date set pursuant to this
Section, the Company shall be deemed to have initially designated the 180th day
after such record date as the Expiration Date with respect thereto, subject to
its right to change the Expiration Date as provided in this paragraph.
Notwithstanding the foregoing, no Expiration Date shall be later than the 180th
day after the applicable record date.
SECTION 1.5. NOTICES.
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Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Agreement to
be made upon, given or furnished to, or filed with,
(1) the Agent by any Holder or by the Company shall be
sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if made, given, furnished or filed in writing and personally delivered
or mailed, first-class postage prepaid, to the Agent at The First National Bank
of Chicago, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇,
Attention: Corporate Trust Services Division, or at any other address previously
furnished in writing by the Agent to the Holders and the Company; or
(2) the Company by the Agent or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if made, given, furnished or filed in writing and personally delivered
or mailed, first-class postage prepaid, to the Company at Lincoln National
Corporation, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, Attention:
Treasurer, or at any other address previously furnished in writing to the Agent
by the Company; or
(3) the Collateral Agent by the Agent, the Company or any
Holder shall be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if made, given, furnished or filed in writing and personally
delivered or mailed, first-class postage prepaid, addressed to the Collateral
Agent at The Chase Manhattan Bank, ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇ ▇▇▇▇▇, Attention: Global Trust Services, or at any other address previously
furnished in writing by the Collateral Agent to the Agent, the Company and the
Holders; or
(4) the Property Trustee by the Company shall be sufficient
for every purpose hereunder (unless otherwise herein expressly provided) if
made, given, furnished or filed in writing and personally delivered or mailed,
first-class postage prepaid, addressed to the Property Trustee at The First
National Bank of Chicago, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇-▇▇▇▇, Attention: Corporate Trust Services Division, or at any other
address previously furnished in writing by the Property Trustee to the Company;
or
(5) the Indenture Trustee by the Company or any Holder shall
be sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if made, given, furnished or filed in writing and personally delivered
or mailed, first-class postage prepaid, addressed to the Indenture Trustee at
The First National Bank of Chicago, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate Trust Services Division, or at any
other address previously furnished in writing by the Indenture Trustee to the
Company.
SECTION 1.6. NOTICE TO HOLDERS; WAIVER.
Where this Agreement provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed,
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first-class postage prepaid, to each Holder affected by such event, at its
address as it appears in the applicable Register, not later than the latest
date, and not earlier than the earliest date, prescribed for the giving of such
notice. In any case where notice to Holders is given by mail, neither the
failure to mail such notice, nor any defect in any notice so mailed to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Where this Agreement provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with the Agent, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Agent shall
constitute a sufficient notification for every purpose hereunder.
SECTION 1.7. EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 1.8. SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Agreement by the Company shall
bind its successors and assigns, whether so expressed or not.
SECTION 1.9. SEPARABILITY CLAUSE.
In case any provision in this Agreement or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof and thereof shall not in any way be affected or
impaired thereby.
SECTION 1.10. BENEFITS OF AGREEMENT.
Nothing in this Agreement or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and, to the extent provided hereby, the Holders, any benefits or any
legal or equitable right, remedy or claim under this Agreement. The Holders from
time to time shall be beneficiaries of this Agreement and shall be bound by all
of the terms and conditions hereof and of the Securities evidenced by their
Certificates by their acceptance of delivery of such Certificates.
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SECTION 1.11. GOVERNING LAW.
THIS AGREEMENT AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 1.12. LEGAL HOLIDAYS.
In any case where any Payment Date shall not be a Business Day, then
(notwithstanding any other provision of this Agreement or the Income PRIDES
Certificates or the Growth PRIDES Certificates) payment of the Contract
Adjustment Payments, if any, shall not be made on such date, but such payments
shall be made on the next succeeding Business Day with the same force and effect
as if made on such Payment Date, provided that no interest shall accrue or be
payable by the Company or any Holder for the period from and after any such
Payment Date, except that, if such next succeeding Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day with the same force and effect as if made on such Payment
Date.
In any case where any Purchase Contract Settlement Date shall not be a
Business Day, then (notwithstanding any other provision of this Agreement, the
Income PRIDES Certificates or the Growth PRIDES Certificates), the Purchase
Contracts shall not be performed on such date, but the Purchase Contracts shall
be performed on the immediately following Business Day with the same force and
effect as if performed on the Purchase Contract Settlement Date.
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.
ARTICLE II
CERTIFICATE FORMS
SECTION 2.1. FORMS OF CERTIFICATES GENERALLY.
The Income PRIDES Certificates (including the form of Purchase Contract
forming part of the Income PRIDES evidenced thereby) shall be in substantially
the form set forth in Exhibit A hereto, with such letters, numbers or other
marks of identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the
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rules of any securities exchange on which the Income PRIDES are listed or any
depositary therefor, or as may, consistently herewith, be determined by the
officers of the Company executing such Income PRIDES Certificates, as evidenced
by their execution of the Income PRIDES Certificates.
The definitive Income PRIDES Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers of the Company executing the
Income PRIDES evidenced by such Income PRIDES Certificates, consistent with the
provisions of this Agreement, as evidenced by their execution thereof.
The Growth PRIDES Certificates (including the form of Purchase
Contracts forming part of the Growth PRIDES evidenced thereby) shall be in
substantially the form set forth in Exhibit B hereto, with such letters, numbers
or other marks of identification or designation and such legends or endorsements
printed, lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Growth PRIDES may be listed or any depositary
therefor, or as may, consistently herewith, be determined by the officers of the
Company executing such Growth PRIDES Certificates, as evidenced by their
execution of the Growth PRIDES Certificates.
The definitive Growth PRIDES Certificates shall be printed,
lithographed or engraved on steel engraved borders or may be produced in any
other manner, all as determined by the officers of the Company executing the
Growth PRIDES evidenced by such Growth PRIDES Certificates, consistent with the
provisions of this Agreement, as evidenced by their execution thereof.
Every Global Certificate authenticated, executed on behalf of the
Holders and delivered hereunder shall bear a legend in substantially the
following form:
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED
IN THE NAME OF THE CLEARING AGENCY OR A NOMINEE THEREOF. THIS
CERTIFICATE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE
REGISTERED, AND NO TRANSFER OF THIS CERTIFICATE IN WHOLE OR IN PART MAY
BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH CLEARING
AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
SECTION 2.2. FORM OF AGENT'S CERTIFICATE OF AUTHENTICATION.
The form of the Agent's certificate of authentication of the Income
PRIDES shall be in substantially the form set forth on the form of the Income
PRIDES Certificates.
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The form of the Agent's certificate of authentication of the Growth
PRIDES shall be in substantially the form set forth on the form of the Growth
PRIDES Certificates.
ARTICLE III
THE SECURITIES
SECTION 3.1. TITLE AND TERMS; DENOMINATIONS.
The aggregate number of Income PRIDES and Growth PRIDES evidenced by
Certificates authenticated, executed on behalf of the Holders and delivered
hereunder is limited to 8,000,000 (9,200,000 if the Underwriters' over-allotment
option pursuant to the Underwriting Agreement and the Pricing Agreement is
exercised in full) except for Certificates authenticated, executed and delivered
upon registration of transfer of, in exchange for, or in lieu of, other
Certificates pursuant to Section 3.4, 3.5, 3.10, 3.13, 3.14, 5.9 or 8.5.
The Certificates shall be issuable only in registered form and only in
denominations of a single Income PRIDES or Growth PRIDES and any integral
multiple thereof.
SECTION 3.2. RIGHTS AND OBLIGATIONS EVIDENCED BY THE CERTIFICATES.
Each Income PRIDES Certificate shall evidence the number of Income
PRIDES specified therein, with each such Income PRIDES representing the owner
ship by the Holder thereof of a beneficial interest in a Preferred Security or
the Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
subject to the Pledge of such Preferred Security or the Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, by such Holder pursuant
to the Pledge Agreement, and the rights and obligations of the Holder thereof
and the Company under one Purchase Contract. The Agent as attorney-in-fact for,
and on behalf of, the Holder of each Income PRIDES shall pledge, pursuant to the
Pledge Agreement, the Preferred Security or the Applicable Ownership Interest of
the Treasury Portfolio, as the case may be, forming a part of such Income
PRIDES, to the Collateral Agent and grant to the Collateral Agent a security
interest in the right, title, and interest of such Holder in such Preferred
Security or the Applicable Ownership Interest of the Treasury Portfolio, as the
case may be, for the benefit of the Company, to secure the obligation of the
Holder under each Purchase Contract to purchase the Common Stock of the Company.
Each Growth PRIDES Certificate shall evidence the number of Growth
PRIDES specified therein, with each such Growth PRIDES representing the
ownership by the Holder thereof of a 1/40 undivided beneficial interest in a
Treasury Security with a principal amount equal to $1,000 subject to the Pledge
of such Treasury Security by such Holder pursuant to the Pledge Agreement, and
the rights and obligations of the Holder thereof and the Company under one
Purchase Contract.
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SECTION 3.3. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
Subject to the provisions of Sections 3.13 and 3.14 hereof, upon the
execution and delivery of this Agreement, and at any time and from time to time
thereafter, the Company may deliver Certificates executed by the Company to the
Agent for authentication, execution on behalf of the Holders and delivery,
together with its Issuer Order for authentication of such Certificates, and the
Agent in accordance with such Issuer Order shall authenticate, execute on behalf
of the Holders and deliver such Certificates.
The Certificates shall be executed on behalf of the Company by its
Chief Executive Officer, its President or one of its Vice Presidents and its
Treasurer or one of its Assistant Treasurers, or its Secretary or one of its
Assistant Secretaries. The signature of any of these officers on the
Certificates may be manual or facsimile.
Certificates bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates.
No Purchase Contract evidenced by a Certificate shall be valid until
such Certificate has been executed on behalf of the Holder by the manual
signature of an authorized signatory of the Agent, as such Holder's
attorney-in-fact. Such signature by an authorized signatory of the Agent shall
be conclusive evidence that the Holder of such Certificate has entered into the
Purchase Contracts evidenced by such Certificate.
Each Certificate shall be dated the date of its authentication.
No Certificate shall be entitled to any benefit under this Agreement or
be valid or obligatory for any purpose unless there appears on such Certificate
a certificate of authentication substantially in the form provided for herein
executed by an authorized signatory of the Agent by manual signature, and such
certificate upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder.
SECTION 3.4. TEMPORARY CERTIFICATES.
Pending the preparation of definitive Certificates, the Company shall
execute and deliver to the Agent, and the Agent shall authenticate, execute on
behalf of the Holders, and deliver, in lieu of such definitive Certificates,
temporary Certificates which are in substantially the form set forth in Exhibit
A or Exhibit B hereto, as the case may be, with such letters, numbers or other
marks of identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Income PRIDES or Growth PRIDES 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.
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If temporary Certificates are issued, the Company will cause definitive
Certificates to be prepared without unreasonable delay. After the preparation of
definitive Certificates, the temporary Certificates shall be exchangeable for
definitive Certificates upon surrender of the temporary Certificates at the
Corporate Trust Office, at the expense of the Company and without charge to the
Holder. Upon surrender for cancellation of any one or more temporary
Certificates, the Company shall execute and deliver to the Agent, and the Agent
shall authenticate, execute on behalf of the Holder, and deliver in exchange
therefor, one or more definitive Certificates of like tenor and denominations
and evidencing a like number of Income PRIDES or Growth PRIDES, as the case may
be, as the temporary Certificate or Certificates so surrendered. Until so
exchanged, the temporary Certificates shall in all respects evidence the same
benefits and the same obligations with respect to the Income PRIDES or Growth
PRIDES, as the case may be, evidenced thereby as definitive Certificates.
SECTION 3.5. REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE.
The Agent shall keep at the Corporate Trust Office a Register (the
"Income PRIDES Register") in which, subject to such reasonable regulations as it
may prescribe, the Agent shall provide for the registration of Income PRIDES
Certificates and of transfers of Income PRIDES Certificates (the Agent, in such
capacity, the "Income PRIDES Registrar") and a Register (the "Growth PRIDES
Register") in which, subject to such reasonable regulations as it may prescribe,
the Agent shall provide for the registration of the Growth PRIDES Certificates
and transfers of Growth PRIDES Certificates (the Agent, in such capacity, the
"Growth PRIDES Registrar").
Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office, the Company shall execute and deliver to the Agent, and
the Agent shall authenticate, execute on behalf of the designated transferee or
transferees, and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of any authorized denominations, like
tenor, and evidencing a like number of Income PRIDES or Growth PRIDES, 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
Income PRIDES or Growth PRIDES, as the case may be, upon surrender of the
Certificates to be exchanged at the Corporate Trust Office. Whenever any
Certificates are so surrendered for exchange, the Company shall execute and
deliver to the Agent, and the Agent shall authenticate, execute on behalf of the
Holder, and deliver the Certificates which the Holder making the exchange is
entitled to receive.
All Certificates issued upon any registration of transfer or exchange
of a Certificate shall evidence the ownership of the same number of Income
PRIDES or Growth PRIDES, as the case may be, and be entitled to the same
benefits and subject to the same obligations, under this Agreement as the Income
PRIDES or Growth PRIDES, as the case may be, evidenced by the Certificate
surrendered upon such registration of transfer or exchange.
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Every Certificate presented or surrendered for registration of transfer
or for exchange shall (if so required by the Agent) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Agent duly executed, by the Holder thereof or its attorney duly
authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of a Certificate, but the Company and the Agent may require payment
from the Holder of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Certificates, other than any exchanges pursuant to Sections 3.6 and
8.5 not involving any transfer.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder and deliver any Certificate
presented or surrendered for registration of transfer or for exchange on or
after the Business Day immediately preceding the earlier of the Purchase
Contract Settlement Date or the Termination Date. In lieu of delivery of a new
Certificate, upon satisfaction of the applicable conditions specified above in
this Section and receipt of appropriate registration or transfer instructions
from such Holder, the Agent shall (i) if the Purchase Contract Settlement Date
has occurred, deliver the shares of Common Stock issuable in respect of the
Purchase Contracts forming a part of the Securities evidenced by such
Certificate, (ii) in the case of Income PRIDES, if a Termination Event shall
have occurred prior to the Purchase Contract Settlement Date, transfer the
aggregate Stated Amount of the Preferred Securities or the Treasury Portfolio,
as applicable, evidenced thereby, or (iii) in the case of Growth PRIDES, if a
Termination Event shall have occurred prior to the Purchase Contract Settlement
Date, transfer the Treasury Securities evidenced thereby, in each case subject
to the applicable conditions and in accordance with the applicable provisions of
Article Five hereof.
SECTION 3.6. BOOK-ENTRY INTERESTS.
The Certificates, on original issuance, will be issued in the form of
one or more, fully registered Global Certificates, to be delivered to the
Depositary by, or on behalf of, the Company. Such Global Certificate shall
initially be registered on the books and records of the Company in the name of
Cede & Co., the nominee of the Depositary, and no Beneficial Owner will receive
a definitive Certificate representing such Beneficial Owner's interest in such
Global Certificate, except as provided in Section 3.9. The Agent shall enter
into an agreement with the Depositary if so requested by the Company. Unless and
until definitive, fully registered Certificates have been issued to Beneficial
Owners pursuant to Section 3.9:
(a) the provisions of this Section 3.6 shall be in
full force and effect;
(b) the Company shall be entitled to deal with the
Clearing Agency for all purposes of this Agreement (including the payment of
Contract Adjustment Payments, if any,
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and receiving approvals, votes or consents hereunder) as the Holder of the
Securities and the sole holder of the Global Certificate(s) and shall have no
obligation to the Beneficial Owners;
(c) to the extent that the provisions of this Section
3.6 conflict with any other provisions of this Agreement, the provisions of this
Section 3.6 shall control; and
(d) the rights of the Beneficial Owners shall be
exercised only through the Clearing Agency and shall be limited to those
established by law and agreements between such Beneficial Owners and the
Clearing Agency and/or the Clearing Agency Participants. The Clearing Agency
will make book entry transfers among Clearing Agency Participants and receive
and transmit payments of Contract Adjustment Payments, if any, to such Clearing
Agency Participants.
SECTION 3.7. NOTICES TO HOLDERS.
Whenever a notice or other communication to the Holders is required to
be given under this Agreement, the Company or the Company's agent shall give
such notices and communications to the Holders and, with respect to any
Securities registered in the name of a Clearing Agency or the nominee of a
Clearing Agency, the Company or the Company's agent shall, except as set forth
herein, have no obligations to the Beneficial Owners.
SECTION 3.8. APPOINTMENT OF SUCCESSOR CLEARING AGENCY.
If any Clearing Agency elects to discontinue its services as securities
depositary with respect to the Securities, the Company may, in its sole
discretion, appoint a successor Clearing Agency with respect to the Securities.
SECTION 3.9. DEFINITIVE CERTIFICATES.
If (i) a Clearing Agency elects to discontinue its services as
securities depositary with respect to the Securities and a successor Clearing
Agency is not appointed within 90 days after such discontinuance pursuant to
Section 3.8, (ii) the Company elects to terminate the book-entry system through
the Clearing Agency with respect to the Securities, or (iii) there shall have
occurred and be continuing a default by the Company in respect of its
obligations under one or more Purchase Contracts, then upon surrender of the
Global Certificates representing the Book-Entry Interests with respect to the
Securities by the Clearing Agency, accompanied by registration instructions, the
Company shall cause definitive Certificates to be delivered to Beneficial Owners
in accordance with the instructions of the Clearing Agency. The Company shall
not be liable for any delay in delivery of such instructions and may
conclusively rely on and shall be protected in relying on, such instructions.
SECTION 3.10. MUTILATED, DESTROYED, LOST AND STOLEN CERTIFICATES.
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If any mutilated Certificate is surrendered to the Agent, the Company
shall execute and deliver to the Agent, and the Agent shall authenticate,
execute on behalf of the Holder, and deliver in exchange therefor, a new
Certificate at the cost of the Holder, evidencing the same number of Income
PRIDES or Growth PRIDES, as the case may be, and bearing a Certificate number
not contemporaneously outstanding.
If there shall be delivered to the Company and the Agent (i) evidence
to their satisfaction of the destruction, loss or theft of any Certificate, and
(ii) such security or indemnity at the cost of the Holder as may be required by
them to hold each of them and any agent of either of them harmless, then, in the
absence of notice to the Company or the Agent that such Certificate has been
acquired by a bona fide purchaser, the Company shall execute and deliver to the
Agent, and the Agent shall authenticate, execute on behalf of the Holder, and
deliver to the Holder, in lieu of any such destroyed, lost or stolen
Certificate, a new Certificate, evidencing the same number of Income PRIDES or
Growth PRIDES, as the case may be, and bearing a Certificate number not
contemporaneously outstanding.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder, and deliver to the Holder, a
Certificate on or after the Business Day immediately preceding the earlier of
the Purchase Contract Settlement Date (or the Early Settlement) or the
Termination Date. In lieu of delivery of a new Certificate, upon satisfaction of
the applicable conditions specified above in this Section and receipt of
appropriate registration or transfer instructions from such Holder, the Agent
shall (i) if the Purchase Contract Settlement Date has occurred, deliver the
shares of Common Stock issuable in respect of the Purchase Contracts forming a
part of the Securities evidenced by such Certificate, or (ii) if a Termination
Event shall have occurred prior to the Purchase Contract Settlement Date,
transfer the Preferred Securities, the appropriate Applicable Ownership Interest
of the Treasury Portfolio or the Treasury Securities, as the case may be,
evidenced thereby, in each case subject to the applicable conditions and in
accordance with the applicable provisions of Article Five hereof.
Upon the issuance of any new Certificate under this Section, the
Company and the Agent may require the payment by the Holder of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Agent)
connected therewith.
Every new Certificate issued pursuant to this Section in lieu of any
destroyed, lost or stolen Certificate shall constitute an original additional
contractual obligation of the Company and of the Holder in respect of the
Security evidenced thereby, whether or not the destroyed, lost or stolen
Certificate (and the Securities evidenced thereby) shall be at any time
enforceable by anyone, and shall be entitled to all the benefits and be subject
to all the obligations of this Agreement equally and proportionately with any
and all other Certificates delivered hereunder.
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The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Certificates.
SECTION 3.11. PERSONS DEEMED OWNERS.
Prior to due presentment of a Certificate for registration of transfer,
the Company and the Agent, and any agent of the Company or the Agent, may treat
the Person in whose name such Certificate is registered as the owner of the
Income PRIDES or Growth PRIDES evidenced thereby, for the purpose of receiving
distributions on the Preferred Securities or on the maturing quarterly interest
strips of the Treasury Portfolio, as applicable, receiving payments of Contract
Adjustment Payments, if any, performance of the Purchase Contracts and for all
other purposes whatsoever, whether or not any distributions on the Preferred
Securities or the Contract Adjustment Payments, if any, payable in respect of
the Purchase Contracts constituting a part of the Income PRIDES or Growth PRIDES
evidenced thereby shall be overdue and notwithstanding any notice to the
contrary, and neither the Company nor the Agent, nor any agent of the Company or
the Agent, shall be affected by notice to the contrary.
Notwithstanding the foregoing, with respect to any Global Certificate,
nothing herein shall prevent the Company, the Agent or any agent of the Company
or the Agent, from giving effect to any written certification, proxy or other
authorization furnished by any Clearing Agency (or its nominee), as a Holder,
with respect to such Global Certificate or impair, as between such Clearing
Agency and owners of beneficial interests in such Global Certificate, the
operation of customary practices governing the exercise of rights of such
Clearing Agency (or its nominee) as Holder of such Global Certificate.
SECTION 3.12. CANCELLATION.
All Certificates surrendered for delivery of shares of Common Stock on
or after the Purchase Contract Settlement Date, upon the transfer of Preferred
Securities, the appropriate Applicable Ownership Interest of the Treasury
Portfolio or Treasury Securities, as the case may be, after the occurrence of a
Termination Event or pursuant to an Early Settlement, or upon the registration
of a transfer or exchange of a Security, or a Collateral Substitution or the
re-establishment of an Income PRIDES shall, if surrendered to any Person other
than the Agent, be delivered to the Agent and, if not already cancelled, shall
be promptly cancelled by it. The Company may at any time deliver to the Agent
for cancellation any Certificates previously authenticated, executed and
delivered hereunder which the Company may have acquired in any manner
whatsoever, and all Certificates so delivered shall, upon Issuer Order, be
promptly cancelled by the Agent. No Certificates shall be authenticated,
executed on behalf of the Holder and delivered in lieu of or in exchange for any
Certificates cancelled as provided in this Section, except as expressly
permitted by this Agreement. All cancelled Certificates held by the Agent shall
upon written request be returned to the Company.
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If the Company or any Affiliate of the Company shall acquire any
Certificate, such acquisition shall not operate as a cancellation of such
Certificate unless and until such Certificate is delivered to the Agent
cancelled or for cancellation.
SECTION 3.13. ESTABLISHMENT OR REESTABLISHMENT OF GROWTH PRIDES.
A Holder may separate the Preferred Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as applicable, from the
related Purchase Contracts in respect of an Income PRIDES by substituting for
such Preferred Securities or the appropriate Applicable Ownership Interest of
the Treasury Portfolio, as the case may be, Treasury Securities in an aggregate
principal amount equal to the aggregate Stated Amount of such Preferred
Securities or for the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, as
applicable (a "Collateral Substitution"), at any time from and after the date of
this Agreement and on or prior to the fifth Business Day immediately preceding
the Purchase Contract Settlement Date in the case of the Preferred Securities
and on or prior to the second Business Day immediately preceding the Purchase
Contract Settlement Date in the case of the appropriate Applicable Ownership
Interest of the Treasury Portfolio, in each case by (a) depositing with the
Collateral Agent Treasury Securities having an aggregate principal amount equal
to the aggregate Stated Amount of the Preferred Securities comprising part of
such Income PRIDES or for the appropriate Applicable Ownership Interest (as
specified in clause (A) of the definition of such term) of the Treasury
Portfolio comprising part of such Income PRIDES, as the case may be, and (b) (i)
by delivering cash in an amount equal to the Contract Adjustment Payments, if
any, that would have accrued since the last date that Contract Adjustment
Payments, if any, were made through the date of substitution on the Growth
PRIDES being created by the holder, which amount the Agent shall promptly remit
to the Company, and (ii) transferring the related Income PRIDES to the Agent
accompanied by a notice to the Agent, substantially in the form of Exhibit D
hereto, stating that the Holder has transferred the relevant amount of Treasury
Securities to the Collateral Agent and requesting that the Agent instruct the
Collateral Agent to release the Preferred Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
underlying such Income PRIDES, whereupon the Agent shall promptly give such
instruction to the Collateral Agent, substantially in the form of Exhibit C
hereto. Upon receipt of the Treasury Securities described in clause (a) above
and the instruction described in clause (b) above, in accordance with the terms
of the Pledge Agreement, the Collateral Agent will release to the Agent, on
behalf of the Holder, Preferred Securities or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be, having a
corresponding aggregate Stated Amount of such Preferred Securities or the
appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, as the case may be, from the
Pledge, free and clear of the Company's security interest therein, and upon
receipt thereof the Agent shall promptly:
(i) cancel the related Income PRIDES;
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(ii) transfer the Preferred Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, to the Holder; and
(iii) authenticate, execute on behalf of such Holder
and deliver a Growth PRIDES Certificate executed by the Company in accordance
with Section 3.3 evidencing the same number of Purchase Contracts as were
evidenced by the cancelled Income PRIDES.
Holders who elect to separate the Preferred Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, from the related Purchase Contract and to substitute Treasury Securities
for such Preferred Securities or the appropriate Applicable Ownership Interest
of the Treasury Portfolio, as the case may be, shall be responsible for any fees
or expenses payable to the Collateral Agent for its services as Collateral Agent
in respect of the substitution, and the Company shall not be responsible for any
such fees or expenses.
Holders may make Collateral Substitutions (i) only in integral
multiples of 40 Income PRIDES if Preferred Securities are being substituted by
Treasury Securities, or (ii) only in integral multiples of 1,600,000 Income
PRIDES if the appropriate Applicable Ownership Interests of the Treasury
Portfolio are being substituted by Treasury Securities.
In the event a Holder making a Collateral Substitution pursuant to this
Section 3.13 fails to effect a book-entry transfer of the Income PRIDES or fails
to deliver an Income PRIDES Certificate(s) to the Agent after depositing
Treasury Securities with the Collateral Agent, the Preferred Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, constituting a part of such Income PRIDES, and any distributions on such
Preferred Security or the Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, shall be held in the name of the Agent or its
nominee in trust for the benefit of such Holder, until such Income PRIDES is so
transferred or the Income PRIDES Certificate is so delivered, as the case may
be, or, with respect to an Income PRIDES Certificate, such Holder provides
evidence satisfactory to the Company and the Agent that such Income PRIDES
Certificate has been destroyed, lost or stolen, together with any indemnity that
may be required by the Agent and the Company.
Except as described in this Section 3.13, for so long as the Purchase
Contract underlying an Income PRIDES remains in effect, such Income PRIDES shall
not be separable into its constituent parts, and the rights and obligations of
the Holder in respect of the Preferred Securities or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be, and Purchase
Contract comprising such Income PRIDES may be acquired, and may be transferred
and exchanged, only as an Income PRIDES.
SECTION 3.14. ESTABLISHMENT OR REESTABLISHMENT OF INCOME PRIDES.
A Holder of a Growth PRIDES may create or recreate Income PRIDES at any
time (i) on or prior to the fifth Business Day immediately preceding the
Purchase Contract Settlement
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Date, if a Tax Event Redemption has not occurred, and (ii) on or prior to the
second Business Day immediately preceding the Purchase Contract Settlement Date,
if a Tax Event Redemption has occurred and an Applicable Ownership Interest in
the Treasury Portfolio has become a component of the Income PRIDES, in each case
by (a) depositing with the Collateral Agent Preferred Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, having an aggregate Stated Amount in the case of the Preferred
Securities, or an appropriate Applicable Ownership Interest (as defined in
clause (A) of the definition of such term) of the Treasury Portfolio, as the
case may be, equal to the aggregate principal amount of the Treasury Securities
comprising part of the Growth PRIDES and (b) transferring the related Growth
PRIDES to the Agent accompanied by a notice to the Agent, substantially in the
form of Exhibit D hereto, stating that the Holder has transferred the relevant
amount of Preferred Securities or the appropriate Applicable Ownership Interest
of the Treasury Portfolio, as the case may be, to the Collateral Agent and
requesting that the Agent instruct the Collateral Agent to release the Treasury
Securities underlying such Growth PRIDES, whereupon the Agent shall promptly
give such instruction to the Collateral Agent, substantially in the form of
Exhibit C hereto. Upon receipt of the Preferred Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
described in clause (a) above and the instruction described in clause (b) above,
in accordance with the terms of the Pledge Agreement, the Collateral Agent will
effect the release of the Treasury Securities having a corresponding aggregate
principal amount from the Pledge to the Agent free and clear of the Company's
security interest therein, and upon receipt thereof the Agent shall promptly:
(i) cancel the related Growth PRIDES;
(ii) transfer the Treasury Securities to the
Holder; and
(iii) authenticate, execute on behalf of such
Holder and deliver an Income PRIDES
Certificate executed by the Company in
accordance with Section 3.3 evidencing the
same number of Purchase Contracts as were
evidenced by the cancelled Growth PRIDES.
Holders of Growth PRIDES may establish or reestablish Income PRIDES in
integral multiples of 40 Growth PRIDES for 40 Income PRIDES if a Tax Event
Redemption has not occurred, and in integral multiples of 1,600,000 Growth
PRIDES for 1,600,000 Income PRIDES if a Tax Event Redemption has occurred.
Except as provided in this Section 3.14, for so long as the Purchase
Contract underlying a Growth PRIDES remains in effect, such Growth PRIDES shall
not be separable into its constituent parts and the rights and obligations of
the Holder of such Growth PRIDES in respect of the Treasury Security and
Purchase Contract comprising such Growth PRIDES may be acquired, and may be
transferred and exchanged only as a Growth PRIDES.
SECTION 3.15. TRANSFER OF COLLATERAL UPON OCCURRENCE OF TERMINATION EVENT.
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Upon the occurrence of a Termination Event and the transfer to the
Agent of the Preferred Securities, the appropriate Applicable Ownership Interest
of the Treasury Portfolio or the Treasury Securities, as the case may be,
underlying the Income PRIDES and the Growth PRIDES pursuant to the terms of the
Pledge Agreement, the Agent shall request transfer instructions with respect to
such Preferred Securities or the appropriate Applicable Ownership Interest of
the Treasury Portfolio or Treasury Securities, as the case may be, from each
Holder by written request mailed to such Holder at its address as it appears in
the Income PRIDES Register or the Growth PRIDES Register, as the case may be.
Upon book-entry transfer of the Income PRIDES or Growth PRIDES or delivery of an
Income PRIDES Certificate or Growth PRIDES Certificate to the Agent with such
transfer instructions, the Agent shall transfer the Preferred Securities, the
Treasury Portfolio or Treasury Securities, as the case may be, underlying such
Income PRIDES or Growth PRIDES, 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 Income PRIDES or Growth PRIDES fails to effect such
transfer or delivery, the Preferred Securities, the appropriate Applicable
Ownership Interest of the Treasury Portfolio or Treasury Securities, as the case
may be, underlying such Income PRIDES or Growth PRIDES, as the case may be, and
any distributions thereon, shall be held in the name of the Agent or its nominee
in trust for the benefit of such Holder, until such Income PRIDES or Growth
PRIDES are transferred or the Income PRIDES Certificate or Growth PRIDES
Certificate is surrendered or such Holder provides satisfactory evidence that
such Income PRIDES Certificate or Growth PRIDES Certificate has been destroyed,
lost or stolen, together with any indemnity that may be required by the Agent
and the Company.
SECTION 3.16. NO CONSENT TO ASSUMPTION.
Each Holder of a Security, by acceptance thereof, shall be deemed
expressly to have withheld any consent to the assumption under Section 365 of
the Bankruptcy Code or otherwise, of the Purchase Contract by the Company, a
receiver, a liquidator or a person or entity performing similar functions, or
its trustee in the event that the Company becomes a debtor under the Bankruptcy
Code or subject to other similar state or federal law providing for
reorganization or liquidation.
ARTICLE IV
THE PREFERRED SECURITIES
SECTION 4.1. PAYMENT OF DISTRIBUTION; RIGHTS TO DISTRIBUTIONS PRESERVED;
DISTRIBUTION RATE RESET; NOTICE.
A distribution on any Preferred Security or on the appropriate
Applicable Ownership Interest in the Treasury Portfolio, as the case may be,
which is paid on any Payment Date shall, subject to receipt thereof by the Agent
from the Collateral Agent as provided by the terms of the Pledge Agreement, be
paid to the Person in whose name the Income PRIDES Certificate (or one or more
Predecessor Income PRIDES Certificates) of which such Preferred Security or the
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appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, is a part is registered at the close of business on the Record Date for
such Payment Date.
Each Income PRIDES Certificate evidencing Preferred Securities
delivered under this Agreement upon registration of transfer of or in exchange
for or in lieu of any other Income PRIDES Certificate shall carry the rights to
distributions accrued and unpaid, and to accrue distributions, which were
carried by the Preferred Securities underlying such other Income PRIDES
Certificate.
In the case of any Income PRIDES with respect to which Cash Settlement
of the underlying Purchase Contract is effected on the Business Day immediately
preceding the Purchase Contract Settlement Date pursuant to prior notice, or
with respect to which Early Settlement of the underlying Purchase Contract is
effected on an Early Settlement Date, or with respect to which a Collateral
Substitution is effected, in each case on a date that is after any Record Date
and on or prior to the next succeeding Payment Date, distributions on the
Preferred Securities or on the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, underlying such Income PRIDES otherwise
payable on such Payment Date shall be payable on such Payment Date
notwithstanding such Cash Settlement or Early Settlement or Collateral
Substitution, and such distributions shall, subject to receipt thereof by the
Agent, be payable to the Person in whose name the Income PRIDES Certificate (or
one or more Predecessor Income PRIDES Certificates) was registered at the close
of business on the Record Date. Except as otherwise expressly provided in the
immediately preceding sentence, in the case of any Income PRIDES with respect to
which Cash Settlement or Early Settlement of the underlying Purchase Contract is
effected on the Business Day immediately preceding the Purchase Contract
Settlement Date or an Early Settlement Date, as the case may be, or with respect
to which a Collateral Substitution has been effected, distributions on the
related Preferred Securities or on the appropriate Applicable Ownership Interest
of the Treasury Portfolio, as the case may be, that would otherwise be payable
after the Purchase Contract Settlement Date or Early Settlement Date shall not
be payable hereunder to the Holder of such Income PRIDES; provided, however,
that to the extent that such Holder continues to hold the separated Preferred
Securities that formerly comprised a part of such Holder's Income PRIDES, such
Holder shall be entitled to receive the distributions on such separated
Preferred Securities.
The applicable Coupon Rate on the Preferred Securities on and after the
Purchase Contract Settlement Date will be reset on the third Business Day
immediately preceding the Purchase Contract Settlement Date to the Reset Rate
(such Reset Rate to be in effect on and after the Purchase Contract Settlement
Date). On the Reset Announcement Date the Reset Spread and the Two-Year
Benchmark Treasury to be used to determine the Reset Rate will be announced by
the Company. On the Business Day immediately following the Reset Announcement
Date, the Preferred Securities Holders will be notified of such Reset Spread and
Two-Year Benchmark Treasury by the Company. Such notice shall be sufficiently
given to Holders of Preferred Securities if published in an Authorized Newspaper
in The City of New York.
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Not later than 7 calendar days nor more than 15 calendar days prior to
the Reset Announcement Date, the Company will notify the DTC or its nominee (or
any successor Clearing Agency or its nominee) by first-class mail, postage
prepaid, to notify the Beneficial Owners or Clearing Agency Participants holding
Income PRIDES or Growth PRIDES, of such Reset Announcement Date and the
procedures to be followed by such Holders of Income PRIDES who intend to settle
their obligation under the Purchase Contract with separate cash on the Purchase
Contract Settlement Date.
SECTION 4.2. NOTICE AND VOTING.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Preferred
Securities pledged with the Collateral Agent but only to the extent instructed
by the Holders as described below. Upon receipt of notice of any meeting at
which holders of Preferred Securities are entitled to vote or upon any
solicitation of consents, waivers or proxies of holders of Preferred Securities,
the Agent shall, as soon as practicable thereafter, mail to the Holders of
Income PRIDES a notice (a) containing such information as is contained in the
notice or solicitation, (b) stating that each Holder on the record date set by
the Agent therefor (which, to the extent possible, shall be the same date as the
record date for determining the holders of Preferred Securities entitled to
vote) shall be entitled to instruct the Agent as to the exercise of the voting
rights pertaining to the Preferred Securities underlying their Income PRIDES and
(c) stating the manner in which such instructions may be given. Upon the written
request of the Holders of Income PRIDES on such record date, the Agent shall
endeavor insofar as practicable to vote or cause to be voted, in accordance with
the instructions set forth in such requests, the maximum number of Preferred
Securities as to which any particular voting instructions are received. In the
absence of specific instructions from the Holder of an Income PRIDES, the Agent
shall abstain from voting the Preferred Security underlying such Income PRIDES.
The Company hereby agrees, if applicable, to solicit Holders of Income PRIDES to
timely instruct the Agent in order to enable the Agent to vote such Preferred
Securities and the Trust shall covenant to such effect in the Trust Agreement.
SECTION 4.3. DISTRIBUTION OF DEBENTURES; TAX EVENT REDEMPTION.
Upon the occurrence of an Investment Company Event or a liquidation of
the Trust in accordance with the Trust Agreement, a principal amount of
Debentures constituting the assets of the Trust and underlying the Preferred
Securities equal to the aggregate Stated Amount of the Pledged Preferred
Securities shall be delivered to the Collateral Agent in exchange for the
Pledged Preferred Securities. Thereafter, the Debentures will be substituted for
the Pledged Preferred Securities, and will be held by the Collateral Agent in
accordance with the terms of the Pledge Agreement to secure the obligations of
each Holder of an Income PRIDES to purchase the Common Stock of the Company
under the Purchase Contracts constituting a part of such Income PRIDES.
Following the occurrence of an Investment Company Event or a liquidation of the
Trust, the Holders and the Collateral Agent shall have such security interests,
rights and obligations with respect to the Debentures as the Holders and the
Collateral Agent had
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in respect of the Preferred Securities subject to the Pledge thereof as provided
in Articles II, III, IV, V and VI of the Pledge Agreement, and any reference
herein to the Preferred Securities shall be deemed to be a reference to such
Debentures. The Company may cause to be made in any Income PRIDES Certificates
thereafter to be issued such change in phraseology and form (but not in
substance) as may be appropriate to reflect the liquidation of the Trust and the
substitution of Debentures for Preferred Securities as Collateral.
Upon the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, the Redemption Price payable on the Tax Event
Redemption Date with respect to the Applicable Principal Amount of Debentures
shall be delivered to the Collateral Agent in exchange for the Pledged Preferred
Securities. Thereafter, pursuant to the terms of the Pledge Agreement, the
Collateral Agent will apply an amount equal to the Redemption Amount of such
Redemption Price to purchase on behalf of the Holders of Income PRIDES the
Treasury Portfolio and promptly remit the remaining portion of such Redemption
Price to the Agent for payment to the Holders of such Income PRIDES. The
Treasury Portfolio will be substituted for the Pledged Preferred Securities, 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 an Income PRIDES to
purchase the Common Stock of the Company under the Purchase Contract
constituting a part of such Income PRIDES. Following the occurrence of a Tax
Event Redemption prior to the Purchase Contract Settlement Date, the Holders of
Income PRIDES and the Collateral Agent shall have such security interests,
rights and obligations with respect to the Treasury Portfolio as the Holder of
Income PRIDES and the Collateral Agent had in respect of the Preferred Security
or Debentures, as the case may be, subject to the Pledge thereof as provided in
Articles II, III, IV, V, and VI of the Pledge Agreement, and any reference
herein to the Preferred Security or the Debenture shall be deemed to be
reference to such Treasury Portfolio. The Company may cause to be made in any
Income PRIDES Certificates thereafter to be issued such change in phraseology
and form (but not in substance) as may be appropriate to reflect the liquidation
of the Trust and the substitution of the Treasury Portfolio for Preferred
Securities or Debentures as collateral.
ARTICLE V
THE PURCHASE CONTRACTS
SECTION 5.1. PURCHASE OF SHARES OF COMMON STOCK.
Each Purchase Contract shall, unless an Early Settlement has occurred
in accordance with Section 5.9 hereof, obligate the Holder of the related
Security to purchase, and the Company to sell, not later than the Purchase
Contract Settlement Date at a price equal to the Stated Amount (the "Purchase
Price"), a number of shares of Common Stock of the Company equal to the
Settlement Rate unless, on or prior to the Purchase Contract Settlement Date,
there shall have occurred a Termination Event with respect to the Security of
which such Purchase Contract is a part. The "Settlement Rate" is equal to (a) if
the Applicable Market Value (as defined below) is equal to or greater than
$111.45 (the "Threshold Appreciation Price"), .2243 shares
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of Common Stock per Purchase Contract, (b) if the Applicable Market Value is
less than the Threshold Appreciation Price, but is greater than $92.875 (the
"Reference Price"), the number of shares of Common Stock equal to the Stated
Amount divided by the Applicable Market Value and (c) if the Applicable Market
Value is less than or equal to the Reference Price, .2692 shares of Common Stock
per Purchase Contract, in each case subject to adjustment as provided in Section
5.6 (and in each case rounded upward or downward to the nearest 1/10,000th of a
share). As provided in Section 5.10, no fractional shares of Common Stock will
be issued upon settlement of Purchase Contracts.
The "Applicable Market Value" means the average of the Closing Price
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date. The "Closing Price" of the Common Stock on any date of determination means
the closing sale price (or, if no closing price is reported, the last reported
sale price) of the Common Stock on The New York Stock Exchange, Inc. (the
"NYSE") on such date or, if the Common Stock is not listed for trading on the
NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States national or
regional securities exchange, the last quoted bid price for the Common Stock in
the over-the-counter market as reported by the National Quotation Bureau or
similar organization, or, if such bid price is not available, the market value
of the Common Stock on such date as determined by a nationally recognized
independent investment banking firm retained for this purpose by the Company. A
"Trading Day" means a day on which the Common Stock (A) is not suspended from
trading on any national or regional securities exchange or association or
over-the-counter market at the close of business and (B) has traded at least
once on the national or regional securities exchange or association or
over-the-counter market that is the primary market for the trading of the Common
Stock.
Each Holder of an Income PRIDES or a Growth PRIDES, by its acceptance
thereof, irrevocably authorizes the Agent to enter into and perform the related
Purchase Contract on its behalf as its attorney-in-fact (including the execution
of Certificates on behalf of such Holder), agrees to be bound by the terms and
provisions thereof, covenants and agrees to perform its obligations under such
Purchase Contracts, and consents to the provisions hereof, irrevocably
authorizes the Agent as its attorney-in-fact to enter into and perform the
Pledge Agreement on its behalf as its attorney-in-fact, and consents to and
agrees to be bound by the Pledge of the Preferred Securities, the Treasury
Portfolio or the Treasury Securities pursuant to the Pledge Agreement; provided
that upon a Termination Event, the rights of the Holder of such Security under
the Purchase Contract may be enforced without regard to any other rights or
obligations. Each Holder of an Income PRIDES or a Growth PRIDES, by its
acceptance thereof, further covenants and agrees, that, to the extent and in the
manner provided in Section 5.4 and the Pledge Agreement, but subject to the
terms thereof, payments in respect of the Stated Amount of the Preferred
Securities or the Proceeds of the Treasury Securities or the Treasury Portfolio
on the Purchase Contract Settlement Date shall be paid by the Collateral Agent
to the Company in satisfaction of such Holder's obligations under such Purchase
Contract and such Holder shall acquire no right, title or interest in such
payments.
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Upon registration of transfer of a Certificate, the transferee shall be
bound (without the necessity of any other action on the part of such
transferee), under the terms of this Agreement, the Purchase Contracts
underlying such Certificate and the Pledge Agreement and the transferor shall be
released from the obligations under this Agreement, the Purchase Contracts
underlying the Certificates so transferred and the Pledge Agreement. The Company
covenants and agrees, and each Holder of a Certificate, by its acceptance
thereof, likewise covenants and agrees, to be bound by the provisions of this
paragraph.
SECTION 5.2. CONTRACT ADJUSTMENT PAYMENTS.
Subject to Section 5.3 herein, the Company shall pay, on each Payment
Date, the Contract Adjustment Payments, if any, payable in respect of each
Purchase Contract to the Person in whose name an Income PRIDES Certificate or a
Growth PRIDES Certificate (or one or more Predecessor Certificates) is
registered at the close of business on the Record Date next preceding such
Payment Date. The Contract Adjustment Payments, if any, will be payable at the
office of the Agent in The City of New York maintained for that purpose or, at
the option of the Company, by check mailed to the address of the Person entitled
thereto at such Person's address as it appears on the Income PRIDES Register or
the Growth PRIDES Register.
Upon the occurrence of a Termination Event, the Company's obligation to
pay Contract Adjustment Payments, if any, (including any accrued or Deferred
Contract Adjustment Payments) shall cease.
Each Certificate delivered under this Agreement upon registration of
transfer of or in exchange for or in lieu of (including as a result of a
Collateral Substitution or the re-establishment of an Income PRIDES) any other
Certificate shall carry the rights to Contract Adjustment Payments, if any,
accrued and unpaid, and to accrue Contract Adjustment Payments, if any, which
were carried by the Purchase Contracts underlying such other Certificates.
Subject to Section 5.9, in the case of any Security with respect to
which Early Settlement of the underlying Purchase Contract is effected on an
Early Settlement Date that is after any Record Date and on or prior to the next
succeeding Payment Date, Contract Adjustment Payments, if any, otherwise payable
on such Payment Date shall be payable on such Payment Date notwithstanding such
Early Settlement, and such Contract Adjustment Payments, if any, shall be paid
to the Person in whose name the Certificate evidencing such Security (or one or
more Predecessor Certificates) is registered at the close of business on such
Record Date. Except as otherwise expressly provided in the immediately preceding
sentence, in the case of any Security with respect to which Early Settlement of
the underlying Purchase Contract is effected on an Early Settlement Date,
Contract Adjustment Payments, if any, that would otherwise be payable after the
Early Settlement Date with respect to such Purchase Contract shall not be
payable.
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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.
SECTION 5.3. DEFERRAL OF PAYMENT DATES FOR CONTRACT ADJUSTMENT PAYMENTS.
The Company shall have the right, at any time prior to the Purchase
Contract Settlement Date, to defer the payment of any or all of the Contract
Adjustment Payments, if any, otherwise payable on any Payment Date, but only if
the Company shall give the Holders and the Agent written notice of its election
to defer such payment (specifying the amount to be deferred) at least ten
Business Days prior to the earlier of (i) the next succeeding Payment Date or
(ii) the date the Company is required to give notice of the Record Date or
Payment Date with respect to payment of such Contract Adjustment Payments, if
any, to the NYSE or other applicable self-regulatory organization or to Holders
of the Securities, but in any event not less than one Business Day prior to such
Record Date. Any Contract Adjustment Payments, if any, so deferred shall bear
additional Contract Adjustment Payments thereon at the rate of 8.25% per annum
(computed on the basis of a 360 day year of twelve 30 day months), compounding
on each succeeding Payment Date, until paid in full (such deferred installments
of Contract Adjustment Payments, if any, together with the additional Contract
Adjustment Payments accrued thereon, being referred to herein as the "Deferred
Contract Adjustment Payments"). Deferred Contract Adjustment Payments shall be
due on the next succeeding Payment Date except to the extent that payment is
deferred pursuant to this Section. No Contract Adjustment Payments, if any, may
be deferred to a date that is after the Purchase Contract Settlement Date. If
the Purchase Contracts are terminated upon the occurrence of a Termination
Event, the Holder's right to receive Contract Adjustment Payments, if any, and
Deferred Contract Adjustment Payments will terminate.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments, if any, on the Purchase Contracts until the Purchase
Contract Settlement Date, each Holder will receive on the Purchase Contract
Settlement Date in lieu of a cash payment a number of shares of Common Stock (in
addition to a number of shares of Common Stock equal to the Settlement Rate)
equal to (x) the aggregate amount of Deferred Contract Adjustment Payments
payable to such Holder divided by (y) the Applicable Market Value.
No fractional shares of Common Stock will be issued by the Company with
respect to the payment of Deferred Contract Adjustment Payments on the Purchase
Contract Settlement Date. In lieu of fractional shares otherwise issuable with
respect to such payment of Deferred Contract Adjustment Payments, the Holder
will be entitled to receive an amount in cash as provided in Section 5.10.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, if any, then, until the Deferred Contract
Adjustment Payments have been paid, the Company may not, and may not permit any
subsidiary of the Company to, (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire, or make a liquidation
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payment with respect to, any of the Company's capital stock or (ii) make any
payment of principal, interest or premium, if any, on or repay, repurchase or
redeem any debt securities of the Company (including other Junior Subordinated
Debt Securities) that rank pari passu with or junior in interest to the
Subordinated Debentures or make any guarantee payments with respect to any
guarantee by the Company of the debt securities of any subsidiary of the Company
if such guarantee ranks pari passu or junior in interest to the Subordinated
Debentures (other than (a) dividends or distributions in Common Stock of the
Company, (b) redemptions or purchases of any rights pursuant to the Company's
Rights Plan, or any successor to such Rights Plan, and the declaration of a
dividend of such rights or the issuance of stock under such plans in the future,
(c) payments under any guarantee, and (d) purchases of Common Stock related to
the issuance of Common Stock under any of the Company's benefit plans for its
directors, officers or employees).
SECTION 5.4. PAYMENT OF PURCHASE PRICE.
(a)(i) Unless a Tax Event Redemption has occurred or a Holder settles
the underlying Purchase Contract through the early delivery of cash to the
Purchase Contract Agent in the manner described in Section 5.9, each Holder of
an Income PRIDES must notify the Agent by use of a notice in substantially the
form of Exhibit E hereto of its intention to pay in cash ("Cash Settlement") the
Purchase Price for the shares of Common Stock to be purchased pursuant to a
Purchase Contract. Such notice shall be made on or prior to 5:00 p.m., New York
City time, on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date. The Agent shall promptly notify the Collateral Agent of the
receipt of such a notice from a Holder intending to make a Cash Settlement.
(ii) A Holder of an Income PRIDES who has so notified the Agent of
its intention to make a Cash Settlement is required to pay the Purchase Price to
the Collateral Agent prior to 11:00 a.m., New York City time, on the Business
Day immediately preceding the Purchase Contract Settlement Date in lawful money
of the United States by certified or cashiers' check or wire transfer, in each
case in immediately available funds payable to or upon the order of the Company.
Any cash received by the Collateral Agent will be invested promptly by the
Collateral Agent in Permitted Investments and paid to the Company on the
Purchase Contract Settlement Date in settlement of the Purchase Contract in
accordance with the terms of this Agreement and the Pledge Agreement. Any funds
received by the Collateral Agent in respect of the investment earnings from the
investment in such Permitted Investments, will be distributed to the Agent when
received for payment to the Holder.
(iii) If a Holder of an Income PRIDES fails to notify the Agent of
its intention to make a Cash Settlement in accordance with paragraph (a)(i)
above, such failure shall constitute an event of default and the Holder shall be
deemed to have consented to the disposition of the pledged Preferred Securities
pursuant to the Remarketing as described in paragraph (b) below. If a Holder of
an Income PRIDES does notify the Agent as provided in paragraph (a)(i) above of
its intention to pay the Purchase Price in cash, but fails to make such payment
as required by paragraph (a)(ii) above, such failure shall also constitute a
default; however, the Preferred
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Securities of such a Holder will not be remarketed but instead the Collateral
Agent, for the benefit of the Company, will exercise its rights as a secured
party with respect to such Preferred Securities, including those rights
specified in paragraph (c) below.
(b) In order to dispose of the Preferred Securities (or Debentures
exchanged for Preferred Securities following an Investment Company Event or
other dissolution of the Trust) of Income PRIDES Holders who have not notified
the Agent of their intention to effect a Cash Settlement as provided in
paragraph (a)(i) above, the Company shall engage a nationally recognized
investment bank (the "Remarketing Agent") pursuant to the Remarketing Agreement
to sell such Preferred Securities (or Debentures). In order to facilitate the
remarketing, the Agent shall notify, by 10:00 a.m., New York City time, on the
fourth Business Day immediately preceding the Purchase Contract Settlement Date,
the Remarketing Agent of the aggregate number of Preferred Securities (or
Debentures) to be remarketed. Concurrently, the Collateral Agent, pursuant to
the terms of the Pledge Agreement, will present for remarketing such Preferred
Securities (or Debentures) to the Remarketing Agent. Upon receipt of such notice
from the Agent and such Preferred Securities (or Debentures) from the Collateral
Agent, the Remarketing Agent will, on the third Business Day immediately
preceding the Purchase Contract Settlement Date, use its reasonable efforts to
remarket such Preferred Securities (or Debentures) on such date at a price of
approximately 100.50% (but not less than 100%) of the aggregate stated
liquidation amount of such Preferred Securities (or Debentures), plus accrued
and unpaid distributions (including deferred distributions), if any, thereon.
After deducting as the remarketing fee ("Remarketing Fee") an amount not
exceeding 25 basis points (.25%) of the aggregate stated liquidation amount of
the remarketed Preferred Securities (or Debentures) from any amount of such
proceeds in excess of the aggregate stated liquidation amount of the remarketed
Preferred Securities (or Debentures) plus accrued and unpaid distributions
(including any deferred distributions), if any, then the Remarketing Agent will
remit the entire amount of the proceeds from such remarketing to the Collateral
Agent. Such portion of the proceeds, equal to the aggregate stated liquidation
amount of such Preferred Securities (or Debentures) will automatically be
applied by the Collateral Agent, in accordance with the Pledge Agreement to
satisfy in full such Income PRIDES holders' obligations to pay the Purchase
Price for the Common Stock under the related Purchase Contracts on the Purchase
Contract Settlement Date. Any proceeds in excess of those required to pay the
Purchase Price and the Remarketing Fee will be remitted to the Agent for payment
to the Holders of the related Income PRIDES. Income PRIDES Holders whose
Preferred Securities (or Debentures) are so remarketed will not otherwise be
responsible for the payment of any Remarketing Fee in connection therewith. If,
in spite of using its reasonable efforts, the Remarketing Agent cannot remarket
the related Preferred Securities (or Debentures) of such Holders of Income
PRIDES at a price not less than 100% of the aggregate stated liquidation amount
of such Preferred Securities (or Debentures) plus accrued and unpaid
distributions (including deferred distributions), if any, the remarketing will
be deemed to have failed (a "Failed Remarketing") and in accordance with the
terms of the Pledge Agreement the Collateral Agent for the benefit of the
Company will exercise its rights as a secured party with respect to such
Preferred Securities (or Debentures), including those actions specified in
paragraph (c) below; provided, that if upon a Failed Remarketing the Collateral
Agent exercises such rights for the benefit of the Company with respect to such
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Preferred Securities (or Debentures), any accrued and unpaid distributions
(including any deferred distributions) on such Preferred Securities (or
Debentures) will become payable by the Company to the Agent for payment to the
Holder of the Income PRIDES to which such Preferred Securities (or Debentures)
relates. Such payment will be made by the Company on or prior to 11 a.m. New
York City time on the Purchase Contract Settlement Date in lawful money of the
United States by certified or cashiers' check or wire transfer in immediately
available funds payable to or upon the order of the Agent. The Company will
cause a notice of such Failed Remarketing to be published on the second Business
Day immediately preceding the Purchase Contract Settlement 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.
(c) With respect to any Preferred Securities beneficially owned by
Holders who have elected Cash Settlement but failed to deliver cash as required
in (a)(ii) above, or with respect to Preferred Securities which are subject to a
Failed Remarketing, the Collateral Agent for the benefit of the Company reserves
all of its rights as a secured party with respect thereto and, subject to
applicable law and paragraph (h) below, may, among other things, (i) retain the
Preferred Securities in full satisfaction of the Holders' obligations under the
Purchase Contracts or (ii) sell the Preferred Securities in one or more public
or private sales.
(d) (i) Unless a Holder of Growth PRIDES or Income PRIDES (if a Tax
Event Redemption has occurred) settles the underlying Purchase Contract
through the early delivery of cash to the Purchase Contract Agent in
the manner described in Section 5.9, each Holder of a Growth PRIDES or
Income PRIDES (if a Tax Event Redemption has occurred) must notify the
Agent by use of a notice in substantially the form of Exhibit E hereto
of its intention to pay in cash the Purchase Price for the shares of
Common Stock to be purchased pursuant to a Purchase Contract on or
prior to 5:00 p.m., New York City time, on the second Business Day
immediately preceding the Purchase Contract Settlement Date.
(ii) A Holder of a Growth PRIDES or Income PRIDES (if a Tax
Event Redemption has occurred) who has so notified the Agent of its
intention to make a Cash Settlement in accordance with paragraph (d)(i)
above is required to pay the Purchase Price to the Collateral Agent
prior to 11:00 a.m., New York City time, on the Business Day
immediately preceding the Purchase Contract Settlement Date in lawful
money of the United States by certified or cashiers' check or wire
transfer, in each case in immediately available funds payable to or
upon the order of the Company. Any cash received by the Collateral
Agent will be invested promptly by the Collateral Agent in Permitted
Investments and paid to the Company on the Purchase Contract Settlement
Date in settlement of the Purchase Contract in accordance with the
terms of this Agreement and the Pledge Agreement. Any funds received by
the Collateral Agent in respect of the investment earnings from the
investment in such Permitted Investments will be distributed to the
Agent when received for payment to the Holder.
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(iii) If a Holder of a Growth PRIDES or an Income PRIDES (if a
Tax Event Redemption has occurred) fails to notify the Agent of its
intention to make a Cash Settlement in accordance with paragraph (d)(i)
above, or if a Holder of a Growth PRIDES or an Income PRIDES (if a Tax
Event Redemption has occurred) does notify the Agent as provided in
paragraph (d)(i) above its intention to pay the Purchase Price in cash,
but fails to make such payment as required by paragraph (d)(ii) above,
then upon the maturity of the Pledged Treasury Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as
the case may be, held by the Collateral Agent on the Business Day
immediately prior to the Purchase Contract Settlement Date, the
principal amount of the Treasury Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, received by the Collateral Agent will be invested promptly in
overnight Permitted Investments. On the Purchase Contract Settlement
Date an amount equal to the Purchase Price will be remitted to the
Company as payment thereof 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 Interest of
the Treasury Portfolio, as the case may be, and the investment earnings
earned from such investments is in excess of the aggregate Purchase
Price of the Purchase Contracts being settled thereby, the Collateral
Agent will distribute such excess to the Agent for the benefit of the
Holder of the related Growth PRIDES or Income PRIDES when received.
(d) Any distribution to Holders of excess funds, and interest described
above, shall be payable at the office of the Agent in The City of New York
maintained for that purpose or, at the option of the Holder, by check mailed to
the address of the Person entitled thereto at such address as it appears on the
Register.
(e) Unless a Holder settles the underlying Purchase Contract through
the early delivery of cash to the Collateral Agent in the manner described
herein, the Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificate therefor to the
Holder unless it shall have received payment in full of the Purchase Price for
the shares of Common Stock to be purchased thereunder in the manner herein set
forth.
(f) Upon Cash Settlement of any Purchase Contract, (i) the Collateral
Agent will in accordance with the terms of the Pledge Agreement cause the
Pledged Preferred Securities or the appropriate Applicable Ownership Interest of
the Treasury Portfolio, as the case may be, or the Pledged Treasury Securities
underlying the relevant Security to be released from the Pledge by the
Collateral Agent free and clear of any security interest of the Company and
transferred to the Agent for delivery to the Holder thereof or its designee as
soon as practicable and (ii) subject to the receipt thereof from the Collateral
Agent, the Agent shall, by book-entry transfer, or other appropriate procedures,
in accordance with instructions provided by the Holder thereof, transfer such
Preferred Securities or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, or such Treasury Securities (or, if no
such instructions are given to the Agent by the Holder, the Agent shall hold
such Preferred Securities or the
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Treasury Portfolio, as the case may be, or such Treasury Securities, and any
distribution thereon, in the name of the Agent or its nominee in trust for the
benefit of such Holder).
(g) The obligations of the Holders to pay the Purchase Price are
non-recourse obligations and are payable solely out of any Cash Settlement or
the proceeds of any Collateral pledged to secure the obligations of the Holders
and in no event will Holders be liable for any deficiency between the proceeds
of Collateral disposition and the Purchase Price.
SECTION 5.5. ISSUANCE OF SHARES OF COMMON STOCK.
Unless a Termination Event or an Early Settlement shall have occurred,
on the Purchase Contract Settlement Date, upon its receipt of payment in full of
the Purchase Price for the shares of Common Stock purchased by the Holders
pursuant to the foregoing provisions of this Article and subject to Section
5.6(b), the Company shall issue and deposit with the Agent, for the benefit of
the Holders of the Outstanding Securities, one or more certificates representing
the shares of Common Stock registered in the name of the Agent (or its nominee)
as custodian for the Holders (such certificates for shares of Common Stock,
together with any dividends or distributions for which both 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 Agent on or after the
Purchase Contract Settlement Date, together with settlement instructions thereon
duly completed and executed, the Holder of such Certificate shall be entitled to
receive in exchange therefor a certificate representing that number of whole
shares of Common Stock which such Holder is entitled to receive pursuant to the
provisions of this Article Five (after taking into account all Securities then
held by such Holder) together with cash in lieu of fractional shares as provided
in Section 5.10 and any dividends or distributions with respect to such shares
constituting part of the Purchase Contract Settlement Fund, but without any
interest thereon, and the Certificate so surrendered shall forthwith be
cancelled. Such shares shall be registered in the name of the Holder or the
Holder's designee as specified in the settlement instructions provided by the
Holder to the Agent. If any shares of Common Stock issued in respect of a
Purchase Contract are to be registered to a Person other than the Person in
whose name the Certificate evidencing such Purchase Contract is registered, no
such registration shall be made unless the Person requesting such registration
has paid any transfer and other taxes required by reason of such registration in
a name other than that of the registered Holder of 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.
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SECTION 5.6. ADJUSTMENT OF SETTLEMENT RATE.
(a) Adjustments for Dividends, Distributions, Stock Splits, Etc.
(1) In case the Company shall pay or make a dividend or other
distribution on the Common Stock in Common Stock, the Settlement Rate, as in
effect at the opening of business on the day following the date fixed for the
determination of stockholders entitled to receive such dividend or other
distribution shall be increased by dividing such Settlement Rate by a fraction
of which the numerator shall be the number of shares of Common Stock outstanding
at the close of business on the date fixed for such determination and the
denominator shall be the sum of such number of shares and the total number of
shares constituting such dividend or other distribution, such increase to become
effective immediately after the opening of business on the day following the
date fixed for such determination. For the purposes of this paragraph (1), the
number of shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include any shares issuable
in respect of any scrip certificates issued in lieu of fractions of shares of
Common Stock. The Company will not pay any dividend or make any distribution on
shares of Common Stock held in the treasury of the Company.
(2) In case the Company shall issue rights, options or
warrants to all holders of its Common Stock (not being available on an
equivalent basis to Holders of the Securities upon settlement of the Purchase
Contracts underlying such Securities) entitling them, for a period expiring
within 45 days after the record date for the determination of stockholders
entitled to receive such rights, options or warrants, to subscribe for or
purchase shares of Common Stock at a price per share less than the Current
Market Price per share of the Common Stock on the date fixed for the
determination of stockholders entitled to receive such rights, options or
warrants (other than pursuant to a dividend reinvestment plan), the Settlement
Rate in effect at the opening of business on the day following the date fixed
for such determination shall be increased by dividing such Settlement Rate by a
fraction of which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination
plus the number of shares of Common Stock which the aggregate of the offering
price of the total number of shares of Common Stock so offered for subscription
or purchase would purchase at such Current Market Price and the denominator
shall be the number of shares of Common Stock outstanding at the close of
business on the date fixed for such determination plus the number of shares of
Common Stock so offered for subscription or purchase, such increase to become
effective immediately after the opening of business on the day following the
date fixed for such determination. For the purposes of this paragraph (2), the
number of shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include any shares issuable
in respect of any scrip certificates issued in lieu of fractions of shares of
Common Stock. The Company shall not issue any such rights, options or warrants
in respect of shares of Common Stock held in the treasury of the Company.
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(3) In case outstanding shares of Common Stock shall be
subdivided or split into a greater number of shares of Common Stock, the
Settlement Rate in effect at the opening of business on the day following the
day upon which such subdivision or split becomes effective shall be
proportionately increased, and, conversely, in case outstanding shares of Common
Stock shall each be combined into a smaller number of shares of Common Stock,
the Settlement Rate, in effect at the opening of business on the day following
the day upon which such combination becomes effective shall be proportionately
reduced, such increase or reduction, as the case may be, to become effective
immediately after the opening of business on the day following the day upon
which such subdivision, split or combination becomes effective.
(4) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock evidences of its indebtedness or
assets (including securities, but excluding any rights or warrants referred to
in paragraph (2) of this Section, any dividend or distribution paid exclusively
in cash and any dividend or distribution referred to in paragraph (1) of this
Section), the Settlement Rate shall be adjusted so that the same shall equal the
rate determined by dividing the Settlement Rate in effect immediately prior to
the close of business on the date fixed for the determination of stockholders
entitled to receive such distribution by a fraction of which the numerator shall
be the Current Market Price per share of the Common Stock on the date fixed for
such determination less the then fair market value (as determined by the Board
of Directors, whose determination shall be conclusive and described in a Board
Resolution filed with the Agent) of the portion of the assets or evidences of
indebtedness so distributed applicable to one share of Common Stock and the
denominator shall be such Current Market Price per share of the Common Stock,
such adjustment to become effective immediately prior to the opening of business
on the day following the date fixed for the determination of stockholders
entitled to receive such distribution. In any case in which this paragraph (4)
is applicable, paragraph (2) of this Section shall not be applicable.
(5) In case the Company shall, (I) by dividend or otherwise,
distribute to all holders of its Common Stock cash (excluding (i) regular
quarterly cash distributions, (ii) any cash that is distributed in a
Reorganization Event to which Section 5.6(b) applies or (iii) cash that is
distributed as part of a distribution referred to in paragraph (4) of this
Section) in an aggregate amount that, combined together with (II) the aggregate
amount of any other distributions to all holders of its Common Stock (other than
regular quarterly cash distributions) made exclusively in cash within the 12
months preceding the date of payment of such distribution and in respect of
which no adjustment pursuant to this paragraph (5) or paragraph (6) of this
Section has been made and (III) the aggregate of any cash plus the fair market
value (as determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) of consideration payable in
respect of any tender or exchange offer (other than consideration payable in
respect of any odd-lot tender offer) by the Company or any of its subsidiaries
for all or any portion of the Common Stock concluded within the 12 months
preceding the date of payment of the distribution described in clause (I) above
and in respect of which no adjustment pursuant to this paragraph (5) or
paragraph (6) of this Section has been made, exceeds 15% of the product of the
Current Market Price per share of the Common Stock on the date for the
determination of holders of shares of Common Stock entitled to receive such
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distribution times the number of shares of Common Stock outstanding on such
date, then, and in each such case, immediately after the close of business on
such date for determination, the Settlement Rate, shall be increased so that the
same shall equal the rate determined by dividing the Settlement Rate in effect
immediately prior to the close of business on the date fixed for determination
of the stockholders entitled to receive such distribution by a fraction (i) the
numerator of which shall be equal to the Current Market Price per share of the
Common Stock on the date fixed for such determination less an amount equal to
the quotient of (x) the combined amount distributed or payable in the
transactions described in clauses (I), (II) and (III) above and (y) the number
of shares of Common Stock outstanding on such date for determination and (ii)
the denominator of which shall be equal to the Current Market Price per share of
the Common Stock on such date for determination.
(6) In case (I) a tender or exchange offer made by the Company
or any subsidiary of the Company for all or any portion of the Common Stock
shall expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to stockholders (based on the acceptance (up
to any maximum specified in the terms of the tender or exchange offer) of
Purchased Shares) of an aggregate consideration having a fair market value (as
determined by the Board of Directors, whose determination shall be conclusive
and described in a Board Resolution) that combined together with (II) the
aggregate of the cash plus the fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a Board
Resolution), as of the expiration of such tender or exchange offer, of
consideration payable in respect of any other tender or exchange offer (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 the Common
Stock expiring within the 12 months preceding the expiration of such tender or
exchange offer and in respect of which no adjustment pursuant to paragraph (5)
of this Section or this paragraph (6) has been made and (III) the aggregate
amount of any distributions (other than regular quarterly cash distributions) to
all holders of the Company's Common Stock made exclusively in cash within the 12
months preceding the expiration of such tender or exchange offer and in respect
of which no adjustment pursuant to paragraph (5) of this Section or this
paragraph (6) has been made, exceeds 15% of the product of the Current Market
Price per share of the Common Stock as of the last time (the "Expiration Time")
tenders could have been made pursuant to such tender or exchange offer (as it
may be amended) times the number of shares of Common Stock outstanding
(including any tendered shares) on the Expiration Time, then, and in each such
case, immediately prior to the opening of business on the day after the date of
the Expiration Time, the Settlement Rate, shall be adjusted so that the same
shall equal the rate determined by dividing the Settlement Rate immediately
prior to the close of business on the date of the Expiration Time by a fraction
(i) the numerator of which shall be equal to (A) the product of (I) the Current
Market Price per share of the Common Stock on the date of the Expiration Time
and (II) the number of shares of Common Stock outstanding (including any
tendered shares) on the Expiration Time less (B) the amount of cash plus the
fair market value (determined as aforesaid) of the aggregate consideration
payable to stockholders based on the transactions described in clauses (I), (II)
and (III) above (assuming in the case of clause (I) the acceptance, up to any
maximum specified in the terms of the tender or exchange offer, of Purchased
Shares), and (ii) the denominator of
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which shall be equal to the product of (A) the Current Market Price per share of
the Common Stock as of the Expiration Time and (B) the number of shares of
Common Stock outstanding (including any tendered shares) as of the Expiration
Time less the number of all shares validly tendered and not withdrawn as of the
Expiration Time (the shares deemed so accepted, up to any such maximum, being
referred to as the "Purchased Shares").
(7) The reclassification of Common Stock into securities
including securities other than Common Stock (other than any reclassification
upon a Reorganization Event to which Section 5.6(b) applies) shall be deemed to
involve (a) a distribution of such securities other than Common Stock to all
holders of Common Stock (and the effective date of such reclassification shall
be deemed to be "the date fixed for the determination of stockholders entitled
to receive such distribution" and the "date fixed for such determination" within
the meaning of paragraph (4) of this Section), and (b) a subdivision, split or
combination, as the case may be, of the number of shares of Common Stock
outstanding immediately prior to such reclassification into the number of shares
of Common Stock outstanding immediately thereafter (and the effective date of
such reclassification shall be deemed to be "the day upon which such subdivision
or split becomes effective" or "the day upon which such combination becomes
effective", as the case may be, and "the day upon which such subdivision, split
or combination becomes effective" within the meaning of paragraph (3) of this
Section).
(8) The "Current Market Price" per share of Common Stock on
any day means the average of the daily Closing Prices for the 5 consecutive
Trading Days selected by the Company commencing not more than 30 Trading Days
before, and ending not later than, the earlier of the day in question and the
day before the "ex date" with respect to the issuance or distribution requiring
such computation. For purposes of this paragraph, the term "ex date", when used
with respect to any issuance or distribution, shall mean the first date on which
the Common Stock trades regular way on such exchange or in such market without
the right to receive such issuance or distribution.
(9) All adjustments to the Settlement Rate, shall be
calculated to the nearest 1/10,000th of a share of Common Stock (or if there is
not a nearest 1/10,000th of a share to the next lower 1/10,000th of a share). No
adjustment in the Settlement Rate shall be required unless such adjustment would
require an increase or decrease of at least one percent therein; provided,
however, that any adjustments which by reason of this subparagraph are not
required to be made shall be carried forward and taken into account in any
subsequent adjustment. If an adjustment is made to the Settlement Rate pursuant
to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of this Section 5.6(a),
an adjustment shall also be made to the Applicable Market Value solely to
determine which of clauses (a), (b) or (c) of the definition of Settlement Rate
in Section 5.1 will apply on the Purchase Contract Settlement Date. Such
adjustment shall be made by multiplying the Applicable Market Value by a
fraction of which the numerator shall be the Settlement Rate immediately after
such adjustment pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10)
of this Section 5.6(a) and the denominator shall be the Settlement Rate
immediately before such adjustment; provided, however, that if such adjustment
to the Settlement Rate is required to be made pursuant to the occurrence of any
of the events contemplated by paragraph (1), (2), (3),
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(4), (5), (7) or (10) of this Section 5.6(a) during the period taken into
consideration for determining the Applicable Market Value, appropriate and
customary adjustments shall be made to the Settlement Rate.
(10) The Company may make such increases in the Settlement
Rate, in addition to those required by this Section, as it considers to be
advisable in order to avoid or diminish any income tax to any holders of shares
of Common Stock resulting from any dividend or distribution of stock or issuance
of rights or warrants to purchase or subscribe for stock or from any event
treated as such for income tax purposes or for any other reasons.
(b) Adjustment for Consolidation, Merger or Other Reorganization
Event. In the event of (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 Common Stock outstanding
immediately prior to the merger or consolidation is not exchanged for cash,
securities or other property of the Company or another corporation), (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
exchange of securities of the Company with another Person (other than in
connection with a merger or acquisition) or (iv) any liquidation, dissolution or
winding up of the Company other than as a result of or after the occurrence of a
Termination Event (any such event, a "Reorganization Event"), the Settlement
Rate will be adjusted to provide that each Holder of Securities will receive on
the Purchase Contract Settlement Date with respect to each Purchase Contract
forming a part thereof, the kind and amount of securities, cash and other
property receivable upon such Reorganization Event (except as otherwise
specifically provided, without any interest thereon, and without any right to
dividends or distributions thereon which have a record date that is prior to the
Purchase Contract Settlement Date) by a Holder of the number of shares of Common
Stock issuable on account of each Purchase Contract if the Purchase Contract
Settlement Date had occurred immediately prior to such Reorganization Event
assuming such Holder of Common Stock is not a Person with which the Company
consolidated or into which the Company merged or which merged into the Company
or to which such sale or transfer was made, as the case may be (any such Person,
a "Constituent Person"), or an Affiliate of a Constituent Person to the extent
such Reorganization Event provides for different treatment of Common Stock held
by Affiliates of the Company and non-affiliates and such Holder failed to
exercise its rights of election, if any, as to the kind or amount of securities,
cash and other property receivable upon such Reorganization Event (provided that
if the kind or amount of securities, cash and other property receivable upon
such Reorganization Event is not the same for each share of Common Stock held
immediately prior to such Reorganization Event by other than a Constituent
Person or an Affiliate thereof and in respect of which such rights of election
shall not have been exercised ("non-electing share"), then for the purpose of
this Section the kind and amount of securities, cash and other property
receivable upon such Reorganization Event by each non-electing share shall be
deemed to be the kind and amount so receivable per share by a plurality of the
non-electing shares). If all or a portion of the consideration payable to the
Holders of Common Stock in a Reorganization Event is cash, the Settlement Rate
shall be further adjusted to provide that each Holder of Securities will receive
on such Purchase Contract Settlement Date with respect to each Purchase Contract
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forming a part thereof an amount equal to interest that could otherwise accrue
on such cash, such interest to accumulate and compound quarterly from the date
the Reorganization Event is consummated to the Purchase Contract Settlement Date
(or, in the case of an Early Settlement, the date of Early Settlement) at 7.75%
per annum (as defined in the Trust Agreement). In the event of such a
Reorganization Event, the Person formed by such consolidation, merger or
exchange or the Person which acquires the assets of the Company or, in the event
of a liquidation or dissolution of the Company, the Company or a liquidating
trust created in connection therewith, shall execute and deliver to the Agent an
agreement supplemental hereto providing that the Holders of each Outstanding
Security shall have the rights provided by this Section 5.6. Such supplemental
agreement shall provide for adjustments which, for events subsequent to the
effective date of such supplemental agreement, shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Section. The above
provisions of this Section shall similarly apply to successive Reorganization
Events.
SECTION 5.7. NOTICE OF ADJUSTMENTS AND CERTAIN OTHER EVENTS.
(a) Whenever the Settlement Rate is adjusted as herein provided,
the Company shall:
(i) forthwith compute the Settlement Rate in accordance with
Section 5.6 and prepare and transmit to the Agent an Officer's Certificate
setting forth the Settlement Rate, the method of calculation thereof in
reasonable detail, and the facts requiring such adjustment and upon which such
adjustment is based; and
(ii) within 10 Business Days following the occurrence of an
event that requires an adjustment to the Settlement Rate pursuant to Section 5.6
(or if the Company is not aware of such occurrence, as soon as practicable after
becoming so aware), provide a written notice to the Holders of the Securities of
the occurrence of such event and a statement in reasonable detail setting forth
the method by which the adjustment to the Settlement Rate was determined and
setting forth the adjusted Settlement Rate.
(b) The Agent shall not at any time be under any duty or
responsibility to any Holder of Securities to determine whether any facts exist
which may require any adjustment of the Settlement Rate, or with respect to the
nature or extent or calculation of any such adjustment when made, or with
respect to the method employed in making the same. The Agent shall not be
accountable with respect to the validity or value (or the kind or amount) of any
shares of Common Stock, or of any securities or property, which may at the time
be issued or delivered with respect to any Purchase Contract; and the Agent
makes no representation with respect thereto. The Agent shall not be responsible
for any failure of the Company to issue, transfer or deliver any shares of
Common Stock pursuant to a Purchase Contract or to comply with any of the
duties, responsibilities or covenants of the Company contained in this Article.
SECTION 5.8. TERMINATION EVENT; NOTICE.
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The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay Contract Adjustment
Payments, if any, or Deferred Contract Adjustment Payments, if the Company shall
have such obligation, and the rights and obligations of Holders to purchase
Common Stock, shall immediately and automatically terminate, without the
necessity of any notice or action by any Holder, the Agent or the Company, if,
on or prior to the Purchase Contract Settlement Date, a Termination Event shall
have occurred. Upon and after the occurrence of a Termination Event, the
Securities shall thereafter represent the right to receive the Preferred
Securities or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, forming a part of such Securities in the case of
Income PRIDES, or Treasury Securities in the case of Growth PRIDES, in
accordance with the provisions of Section 4.3 of the Pledge Agreement. Upon the
occurrence of a Termination Event, the Company shall promptly but in no event
later than two Business Days thereafter give written notice to the Agent, the
Collateral Agent and to the Holders, at their addresses as they appear in the
Register.
SECTION 5.9. EARLY SETTLEMENT.
(a) Subject to and upon compliance with the provisions of this Section
5.9, at the option of the Holder thereof, Purchase Contracts underlying
Securities having an aggregate Stated Amount equal to $1,000 or an integral
multiple thereof may be settled early ("Early Settlement") in the case of Income
PRIDES (unless a Tax Event Redemption has occurred) on or prior to the fifth
Business Day immediately preceding the Purchase Contract Settlement Date and in
the case of Growth PRIDES on or prior to the second Business Day immediately
preceding the Purchase Contract Settlement Date, in each case, as provided
herein; provided however, that if a Tax Event Redemption has occurred and the
Treasury Portfolio has become a component of the Income PRIDES, Purchase
Contracts underlying Income PRIDES may be settled early, on or prior to the
second Business Day immediately preceding the Purchase Contract Settlement Date,
but only in an aggregate amount of $40,000,000 or in an integral multiple
thereof. In order to exercise the right to effect Early Settlement with respect
to any Purchase Contracts, the Holder of the Certificate evidencing Securities
shall deliver such Certificate to the Agent at the Corporate Trust Office 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 product of (A) the Stated Amount times (B)
the number of Purchase Contracts with respect to which the Holder has elected to
effect Early Settlement plus (ii) 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 sum of (x) the Contract Adjustment Payments, if
any, payable on such Payment Date with respect to such Purchase Contracts plus
(y) in the case of Income PRIDES Certificate, the distributions on the related
Preferred Securities payable on such Payment Date. Except as provided in the
immediately preceding sentence and subject to the second to last paragraph of
Section 5.2, no payment or adjustment shall be made upon Early Settlement of any
Purchase Contract on account of any
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Contract Adjustment Payments, if any, accrued on such Purchase Contract or on
account of any dividends on the Common Stock issued upon such Early Settlement
or on account of any Deferred Contract Adjustment Payments. If the foregoing
requirements are first satisfied with respect to Purchase Contracts underlying
any Securities at or prior to 5:00 p.m., New York City time, on a Business Day,
such day shall be the "Early Settlement Date" with respect to such Securities
and if such requirements are first satisfied after 5:00 p.m., New York City
time, on a Business Day or on a day that is not a Business Day, the "Early
Settlement Date" with respect to such Securities shall be the next succeeding
Business Day.
(b) Upon Early Settlement of Purchase Contracts by a Holder of the
related Securities and payment of any transfer or similar taxes payable by such
Holder in connection with the issuance of the related Common Stock to any person
other than such Holder, the Company shall issue, and the Holder shall be
entitled to receive, shares of Common Stock on account of each Purchase Contract
as to which Early Settlement is effected (the "Early Settlement Rate");
provided, however, that upon the Early Settlement of the Purchase Contracts, the
Holder of such related Securities will forfeit the right to receive any Deferred
Contract Adjustment Payments and future Contract Adjustment Payments, if any.
The Early Settlement Rate shall be adjusted in the same manner and at the same
time as the Settlement Rate is adjusted. As promptly as practicable after Early
Settlement of Purchase Contracts in accordance with the provisions of this
Section 5.9, the Company shall issue and shall deliver to the Agent at the
Corporate Trust Office a certificate or certificates for the full number of
shares of Common Stock issuable upon such Early Settlement together with payment
in lieu of any fraction of a share, as provided in Section 5.10.
(c) No later than the third Business Day after the applicable Early
Settlement Date the Company shall cause (i) the shares of Common Stock issuable
upon Early Settlement of Purchase Contracts to be issued and delivered, and (ii)
the related Preferred Securities or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, in the case of Income PRIDES, or the related
Treasury Securities, in the case of Growth PRIDES, to be released from the
Pledge by the Collateral Agent and transferred, in each case to the Agent for
delivery to the Holder thereof or its designee.
(d) Upon Early Settlement of any Purchase Contracts, and subject to
receipt of shares of Common Stock from the Company and the Preferred Securities,
the appropriate Applicable Ownership Interest of the Treasury Portfolio or
Treasury Securities, as the case may be, from the Collateral Agent, as
applicable, the Agent shall, in accordance with the instructions provided by the
Holder thereof on the applicable form of Election to Settle Early on the reverse
of the Certificate evidencing the related Securities, (i) transfer to the Holder
the Preferred Securities, Treasury Portfolio or Treasury Securities, as the case
may be, forming a part of such Securities, and (ii) deliver to the Holder a
certificate or certificates for the full number of shares of Common Stock
issuable upon such Early Settlement together with payment in lieu of any
fraction of a share, as provided in Section 5.10.
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(e) In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Securities evidenced by a
Certificate, upon such Early Settlement the Company shall execute and the Agent
shall authenticate, countersign and deliver to the Holder thereof, at the
expense of the Company, a Certificate evidencing the Securities as to which
Early Settlement was not effected.
SECTION 5.10. NO FRACTIONAL SHARES.
No fractional shares or scrip representing fractional shares of Common
Stock shall be issued or delivered upon settlement on the Purchase Contract
Settlement Date or upon Early Settlement of any Purchase Contracts. If
Certificates evidencing more than one Purchase Contract shall be surrendered for
settlement at one time by the same Holder, the number of full shares of Common
Stock which shall be delivered upon settlement shall be computed on the basis of
the aggregate number of Purchase Contracts evidenced by the Certificates so
surrendered. Instead of any fractional share of Common Stock which would
otherwise be deliverable upon settlement of any Purchase Contracts on the
Purchase Contract Settlement Date or upon Early Settlement, the Company, through
the Agent, shall make a cash payment in respect of such fractional interest in
an amount equal to the value of such fractional shares times the Applicable
Market Value. The Company shall provide the Agent from time to time with
sufficient funds to permit the Agent to make all cash payments required by this
Section 5.10 in a timely manner.
SECTION 5.11. CHARGES AND TAXES.
The Company will pay all stock transfer and similar taxes attributable
to the initial issuance and delivery of the shares of Common Stock pursuant to
the Purchase Contracts and in payment of any Deferred Contract Adjustment
Payments; provided, however, that the Company shall not be required to pay any
such tax or taxes which may be payable in respect of any exchange of or
substitution for a Certificate evidencing a Security or any issuance of a share
of Common Stock in a name other than that of the registered Holder of a
Certificate surrendered in respect of the Securities evidenced thereby, other
than in the name of the Agent, as custodian for such Holder, and the Company
shall not be required to issue or deliver such share certificates or
Certificates unless or until the Person or Persons requesting the transfer or
issuance thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.
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ARTICLE VI
REMEDIES
SECTION 6.1. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE CONTRACT ADJUSTMENT
PAYMENTS AND TO PURCHASE COMMON STOCK.
In the event that Contract Adjustment Payments shall constitute a
component of Income PRIDES or Growth PRIDES, the Holder of any Income PRIDES or
Growth PRIDES shall have the right, which is absolute and unconditional (subject
to the right of the Company to defer payment thereof pursuant to Section 5.3,
the prepayment of Contract Adjustment Payments, if any, pursuant to Section
5.9(a) and to the forfeiture of any Deferred Contract Adjustment Payments upon
Early Settlement pursuant to Section 5.9(b) or upon the occurrence of a
Termination Event), to receive payment of each installment of the Contract
Adjustment Payments, if any, with respect to the Purchase Contract constituting
a part of such Security on the respective Payment Date for such Security and to
purchase Common Stock pursuant to such Purchase Contract and, in each such case,
to institute suit for the enforcement of any such payment and right to purchase
Common Stock, and such rights shall not be impaired without the consent of such
Holder.
SECTION 6.2. RESTORATION OF RIGHTS AND REMEDIES.
If any Holder has instituted any proceeding to enforce any right or
remedy under this Agreement and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company and such Holder shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies of such Holder
shall continue as though no such proceeding had been instituted.
SECTION 6.3. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Certificates in the last paragraph of
Section 3.10, no right or remedy herein conferred upon or reserved to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 6.4. DELAY OR OMISSION NOT WAIVER.
No delay or omission of any Holder to exercise any right or remedy upon
a default shall impair any such right or remedy or constitute a waiver of any
such right. Every right and
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remedy given by this Article or by law to the Holders may be exercised from time
to time, and as often as may be deemed expedient, by such Holders.
SECTION 6.5. UNDERTAKING FOR COSTS.
All parties to this Agreement agree, and each Holder of Income PRIDES
or Growth PRIDES, by its acceptance of such Income PRIDES or Growth PRIDES shall
be deemed to have agreed, that any court may in its discretion require, in any
suit for the enforcement of any right or remedy under this Agreement, or in any
suit against the Agent for any action taken, suffered or omitted by it as Agent,
the filing by any party litigant in such suit of an undertaking to pay the costs
of such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant; provided that the provisions of this Section shall not
apply to any suit instituted by the Company, to any suit instituted by the
Agent, to any suit instituted by any Holder, or group of Holders, holding in the
aggregate more than 10% of the Outstanding Securities, or to any suit instituted
by any Holder for the enforcement of distributions on any Preferred Securities
or Contract Adjustment Payments, if any, on any Purchase Contract on or after
the respective Payment Date therefor in respect of any Security held by such
Holder, or for enforcement of the right to purchase shares of Common Stock under
the Purchase Contracts constituting part of any Security held by such Holder.
SECTION 6.6. WAIVER OF STAY OR EXTENSION LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Agreement; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Agent or the Holders, but will suffer and permit the
execution of every such power as though no such law had been enacted.
ARTICLE VII
THE AGENT
SECTION 7.1. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) (1) The Agent undertakes to perform, with respect to the
Securities, such duties and only such duties as are specifically set
forth in this Agreement and the Pledge Agreement, and no implied
covenants or obligations shall be read into this Agreement against the
Agent; and
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(2) The Agent may, with respect to the Securities, conclusively
rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to
the Agent and conforming to the requirements of this Agreement, but in
the case of any certificates or opinions which by any provision hereof
are specifically required to be furnished to the Agent, the Agent shall
be under a duty to examine the same to determine whether or not they
conform to the requirements of this Agreement.
(b) No provision of this Agreement shall be construed to relieve the
Agent from liability for its own negligent action, its own negligent failure to
act, or its own wilful misconduct, except that
(1) this Subsection shall not be construed to limit the effect of
Subsection (a) of this Section;
(2) the Agent shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the
Agent was negligent in ascertaining the pertinent facts; and
(3) no provision of this Agreement shall require the Agent to
expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder, or in the exercise
of any of its rights or powers.
(c) Whether or not therein expressly so provided, every provision of
this Agreement relating to the conduct or affecting the liability of or
affording protection to the Agent shall be subject to the provisions of this
Section.
(d) The Agent is authorized to execute and deliver the Pledge Agreement
in its capacity as Agent.
SECTION 7.2. NOTICE OF DEFAULT.
Within 30 days after the occurrence of any default by the Company
hereunder of which a Responsible Officer of the Agent has actual knowledge, the
Agent shall transmit by mail to the Company and the Holders of Securities, as
their names and addresses appear in the Register, notice of such default
hereunder, unless such default shall have been cured or waived.
SECTION 7.3. CERTAIN RIGHTS OF AGENT.
Subject to the provisions of Section 7.1:
(a) the Agent may rely and shall be protected in acting or refraining
from acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or
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document believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by an Officer's Certificate, Issuer Order or Issuer
Request, and any resolution of the Board of Directors of the Company may be
sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Agreement the Agent shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Agent (unless other evidence be
herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officer's Certificate of the Company;
(d) the Agent may consult with counsel of its selection and the advice
of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon;
(e) the Agent shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the Agent,
in its discretion, may make reasonable further inquiry or investigation into
such facts or matters related to the execution, delivery and performance of the
Purchase Contracts as it may see fit, and, if the Agent shall determine to make
such further inquiry or investigation, it shall be given a reasonable
opportunity to examine the books, records and premises of the Company,
personally or by agent or attorney; and
(f) the Agent may execute any of the powers hereunder or perform any
duties hereunder either directly or by or through agents or attorneys or an
Affiliate and the Agent shall not be responsible for any misconduct or
negligence on the part of any agent or attorney or an Affiliate appointed with
due care by it hereunder.
SECTION 7.4. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Certificates shall be taken as
the statements of the Company and the Agent assumes no responsibility for their
accuracy. The Agent makes no representations as to the validity or sufficiency
of either this Agreement or of the Securities, or of the Pledge Agreement or the
Pledge. The Agent shall not be accountable for the use or application by the
Company of the proceeds in respect of the Purchase Contracts.
SECTION 7.5. MAY HOLD SECURITIES.
Any Registrar or any other agent of the Company, or the Agent and its
Affiliates, in their individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with the Company, the Collateral
Agent or any other Person with the same rights it would have if it were not
Registrar or such other agent, or the Agent.
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SECTION 7.6. MONEY HELD IN CUSTODY.
Money held by the Agent in custody hereunder need not be segregated
from the other funds except to the extent required by law or provided herein.
The Agent shall be under no obligation to invest or pay interest on any money
received by it hereunder except as otherwise agreed in writing with the Company.
SECTION 7.7. COMPENSATION AND REIMBURSEMENT.
The Company agrees:
(1) to pay to the Agent from time to time such compensation
for all services rendered by it hereunder as the parties shall agree
from time to time;
(2) except as otherwise expressly provided herein, to
reimburse the Agent upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Agent in accordance
with any provision of this Agreement (including the reasonable
compensation and the expenses and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence, willful misconduct or bad faith; and
(3) to indemnify the Agent and any predecessor Agent for, and
to hold it harmless against, any loss, liability or expense incurred
without negligence, willful misconduct or bad faith on its part,
arising out of or in connection with the acceptance or administration
of its duties hereunder, including the costs and expenses of defending
itself against any claim or liability in connection with the exercise
or performance of any of its powers or duties hereunder.
SECTION 7.8. CORPORATE AGENT REQUIRED; ELIGIBILITY.
There shall at all times be an Agent hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having (or being a member of a bank
holding company having) a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by Federal or State authority and having a
Corporate Trust Office in the Borough of Manhattan, The City of New York, if
there be such a corporation in the Borough of Manhattan, The City of New York,
qualified and eligible under this Article and willing to act on reasonable
terms. If such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Agent shall cease to be eligible in
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accordance with the provisions of this Section, it shall resign immediately in
the manner and with the effect hereinafter specified in this Article.
SECTION 7.9. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of the Agent and no appointment of a
successor Agent pursuant to this Article shall become effective until the
acceptance of appointment by the successor Agent in accordance with the
applicable requirements of Section 7.10.
(b) The Agent may resign at any time by giving written notice
thereof to the Company 60 days prior to the effective date of such resignation.
If the instrument of acceptance by a successor Agent required by Section 7.10
shall not have been delivered to the Agent within 30 days after the giving of
such notice of resignation, the resigning Agent may petition any court of
competent jurisdiction for the appointment of a successor Agent.
(c) The Agent may be removed at any time by Act of the Holders of
a majority in number of the Outstanding Securities delivered to the Agent and
the Company.
(d) if at any time
(1) the Agent fails to comply with Section 310(b) of the TIA,
as if the Agent were an indenture trustee under an indenture qualified
under the TIA, after written request therefor by the Company or by any
Holder who has been a bona fide Holder of a Security for at least six
months, or
(2) the Agent shall cease to be eligible under Section 7.8 and
shall fail to resign after written request therefor by the Company or
by any such Holder, or
(3) the Agent shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver for the Agent or for its
property shall be appointed or any public officer shall take charge or
control of the Agent or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation, then, in any such case,
(i) the Company by a Board Resolution may remove the Agent, or (ii) any
Holder who has been a bona fide Holder of a Security for at least six
months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the
Agent and the appointment of a successor Agent.
(e) If the Agent shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Agent for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Agent and
shall comply with the applicable requirements of Section 7.10. If no successor
Agent shall have been so appointed by the Company and accepted appointment in
the manner required by Section 7.10, any Holder who has been a bona fide Holder
of a Security for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Agent.
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(f) The Company shall give, or shall cause such successor Agent to
give, notice of each resignation and each removal of the Agent and each
appointment of a successor Agent by mailing written notice of such event by
first-class mail, postage prepaid, to all Holders as their names and addresses
appear in the applicable Register. Each notice shall include the name of the
successor Agent and the address of its Corporate Trust Office.
SECTION 7.10. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor Agent,
every such successor Agent so appointed shall execute, acknowledge and deliver
to the Company and to the retiring Agent an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Agent
shall become effective and such successor Agent, without any further act, deed
or conveyance, shall become vested with all the rights, powers, agencies and
duties of the retiring Agent; but, on the request of the Company or the
successor Agent, such retiring Agent shall, upon payment of its charges, execute
and deliver an instrument transferring to such successor Agent all the rights,
powers and trusts of the retiring Agent and shall duly assign, transfer and
deliver to such successor Agent all property and money held by such retiring
Agent hereunder.
(b) Upon request of any such successor Agent, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Agent all such rights, powers and agencies referred
to in paragraph (a) of this Section.
(c) No successor Agent shall accept its appointment unless at the
time of such acceptance such successor Agent shall be qualified and eligible
under this Article.
SECTION 7.11. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any corporation into which the Agent may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Agent shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Agent, shall be the successor of the Agent hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Certificates shall have been
authenticated and executed on behalf of the Holders, but not delivered, by the
Agent then in office, any successor by merger, conversion or consolidation to
such Agent may adopt such authentication and execution and deliver the
Certificates so authenticated and executed with the same effect as if such
successor Agent had itself authenticated and executed such Securities.
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SECTION 7.12. PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.
(a) The Agent shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders received by the
Agent in its capacity as Registrar.
(b) If three or more Holders (herein referred to as "applicants")
apply in writing to the Agent, and furnish to the Agent reasonable proof that
each such applicant has owned a Security for a period of at least six months
preceding the date of such application, and such application states that the
applicants desire to communicate with other Holders with respect to their rights
under this Agreement or under the Securities and is accompanied by a copy of the
form of proxy or other communication which such applicants propose to transmit,
then the Agent shall mail to all the Holders copies of the form of proxy or
other communication which is specified in such request, with reasonable
promptness after a tender to the Agent of the materials to be mailed and of
payment, or provision for the payment, of the reasonable expenses of such
mailing.
SECTION 7.13. NO OBLIGATIONS OF AGENT.
Except to the extent otherwise provided in this Agreement, the Agent
assumes no obligations and shall not be subject to any liability under this
Agreement, the Pledge Agreement or any Purchase Contract in respect of the
obligations of the Holder of any Security thereunder. The Company agrees, and
each Holder of a Certificate, by his acceptance thereof, shall be deemed to have
agreed, that the Agent's execution of the Certificates on behalf of the Holders
shall be solely as agent and attorney-in-fact for the Holders, and that the
Agent shall have no obligation to perform such Purchase Contracts on behalf of
the Holders, except to the extent expressly provided in Article Five hereof.
SECTION 7.14. TAX COMPLIANCE.
(a) The Agent, on its own behalf and on behalf of the Company,
will comply with all applicable certification, information reporting and
withholding (including "backup" withholding) requirements imposed by applicable
tax laws, regulations or administrative practice with respect to (i) any
payments made with respect to the Securities or (ii) the issuance, delivery,
holding, transfer, redemption or exercise of rights under the Securities. Such
compliance shall include, without limitation, the preparation and timely filing
of required returns and the timely payment of all amounts required to be
withheld to the appropriate taxing authority or its designated agent.
(b) The Agent shall comply with any written direction received
from the Company with respect to the application of such requirements to
particular payments or Holders or in other particular circumstances, and
may for purposes of this Agreement rely on any such direction in accordance with
the provisions of Section 7.1(a)(2) hereof.
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(c) The Agent shall maintain all appropriate records documenting
compliance with such requirements, and shall make such records available, on
written request, to the Company or its authorized representative within a
reasonable period of time after receipt of such request.
ARTICLE VIII
SUPPLEMENTAL AGREEMENTS
SECTION 8.1. SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company and the Agent, at any
time and from time to time, may enter into one or more agreements supplemental
hereto, in form satisfactory to the Company and the Agent, for any of the
following purposes:
(1) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of the
Company herein and in the Certificates; or
(2) to add to the covenants of the Company for the benefit of
the Holders, or to surrender any right or power herein conferred upon the
Company; or
(3) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(4) to make provision with respect to the rights of Holders
pursuant to the requirements of Section 5.6(b); or
(5) to cure any ambiguity, to correct or supplement any
provisions herein which may be inconsistent with any other provisions herein, or
to make any other provisions with respect to such matters or questions arising
under this Agreement, provided such action shall not adversely affect the
interests of the Holders.
SECTION 8.2. SUPPLEMENTAL AGREEMENTS WITH CONSENT OF HOLDERS.
With the consent of the Holders of not less than a majority of the
outstanding Purchase Contracts voting together as one Class, by Act of said
Holders delivered to the Company and the Agent, the Company, when authorized by
a Board Resolution, and the Agent may enter into an agreement or agreements
supplemental hereto for the purpose of modifying in any manner the terms of the
Purchase Contracts, or the provisions of this Agreement or the rights of the
Holders in respect of the Securities; provided, however, that, except as
contemplated herein, no such supplemental agreement shall, without the consent
of the Holder of each Outstanding Security affected thereby,
(1) change any Payment Date;
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(2) change the amount or the type of Collateral required to be
Pledged to secure a Holder's Obligations under the Purchase Contract,
impair the right of the Holder of any Purchase Contract to receive
distributions on the related Collateral (except for the rights of
Holders of Income PRIDES to substitute the Treasury Securities for the
Pledged Preferred Securities or the rights of holders of Growth PRIDES
to substitute Preferred Securities for the Pledged Treasury Securities)
or otherwise adversely affect the Holder's rights in or to such
Collateral or adversely alter the rights in or to such Collateral;
(3) reduce any Contract Adjustment Payments, if any, or any
Deferred Contract Adjustment Payment, or change any place where, or the
coin or currency in which, any Contract Adjustment Payment is payable;
(4) impair the right to institute suit for the enforcement of
any Purchase Contract, any Contract Payment Adjustments or any Deferred
Contract PAyment Adjustments;
(5) reduce the number of shares of Common Stock to be
purchased pursuant to any Purchase Contract, increase the price to
purchase shares of Common Stock upon settlement of any Purchase
Contract, change the Purchase Contract Settlement Date or the right to
Early Settlement or otherwise adversely affect the Holder's rights
under any Purchase Contract; or
(6) reduce the percentage of the outstanding Purchase
Contracts the consent of whose Holders is required for any such
supplemental agreement; provided, that if any amendment or proposal
referred to above would adversely affect only the Income PRIDES or the
Growth PRIDES, 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.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental agreement, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 8.3. EXECUTION OF SUPPLEMENTAL AGREEMENTS.
In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Agent shall be entitled to receive
and (subject to Section 7.1) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental agreement is
authorized or permitted by this Agreement. The Agent may, but shall not be
obligated to, enter into any such supplemental agreement which affects the
Agent's own rights, duties or immunities under this Agreement or otherwise.
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SECTION 8.4. EFFECT OF SUPPLEMENTAL AGREEMENTS.
Upon the execution of any supplemental agreement under this Article,
this Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of this Agreement for all purposes; and every Holder
of Certificates theretofore or thereafter authenticated, executed on behalf of
the Holders and delivered hereunder shall be bound thereby.
SECTION 8.5. REFERENCE TO SUPPLEMENTAL AGREEMENTS.
Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Agent, bear a notation in form
approved by the Agent as to any matter provided for in such supplemental
agreement. If the Company shall so determine, new Certificates so modified as to
conform, in the opinion of the Agent and the Company, to any such supplemental
agreement may be prepared and executed by the Company and authenticated,
executed on behalf of the Holders and delivered by the Agent in exchange for
Outstanding Certificates.
ARTICLE IX
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
SECTION 9.1. COVENANT NOT TO MERGE, CONSOLIDATE, SELL OR CONVEY PROPERTY
EXCEPT UNDER CERTAIN CONDITIONS.
The Company covenants that it will not merge or consolidate with any
other Person or sell, assign, transfer, lease or convey all or substantially all
of its properties and assets to any Person or group of affiliated Persons in one
transaction or a series of related transactions, unless (i) either the Company
shall be the continuing corporation, or the successor (if other than the
Company) shall be a corporation organized and existing under the laws of the
United States of America or a State thereof or the District of Columbia and such
corporation shall expressly assume all the obligations of the Company under the
Purchase Contracts, the Subordinated Debentures, this Agreement, the Pledge
Agreement, the Subordinated Indenture (including any supplemental indenture
thereto) and the Remarketing Agreement by one or more supplemental agreements in
form reasonably satisfactory to the Agent and the Collateral Agent, executed and
delivered to the Agent and the Collateral Agent by such corporation, and (ii)
the Company or such successor corporation, as the case may be, shall not,
immediately after such merger or consolidation, or such sale, assignment,
transfer, lease or conveyance, be in default of its payment obligations
thereunder or in material default in the performance of any of its obligations
thereunder.
SECTION 9.2. RIGHTS AND DUTIES OF SUCCESSOR CORPORATION.
In case of any such consolidation, merger, sale, assignment, transfer,
lease or conveyance and upon any such assumption by a successor corporation in
accordance with Section 9.1, such
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successor corporation shall succeed to and be substituted for the Company with
the same effect as if it had been named herein as the Company. Such successor
corporation thereupon may cause to be signed, and may issue either in its own
name or in the name of Lincoln National Corporation any or all of the
Certificates evidencing Securities issuable hereunder which theretofore shall
not have been signed by the Company and delivered to the Agent; and, upon the
order of such successor corporation, instead of the Company, and subject to all
the terms, conditions and limitations in this Agreement prescribed, the Agent
shall authenticate and execute on behalf of the Holders and deliver any
Certificates which previously shall have been signed and delivered by the
officers of the Company to the Agent for authentication and execution, and any
Certificate evidencing Securities which such successor corporation thereafter
shall cause to be signed and delivered to the Agent for that purpose. All the
Certificates so issued shall in all respects have the same legal rank and
benefit under this Agreement as the Certificates theretofore or thereafter
issued in accordance with the terms of this Agreement as though all of such
Certificates had been issued at the date of the execution hereof.
In case of any such consolidation, merger, sale, assignment, transfer,
lease or conveyance, such change in phraseology and form (but not in substance)
may be made in the Certificates evidencing Securities thereafter to be issued as
may be appropriate.
SECTION 9.3. OPINION OF COUNSEL GIVEN TO AGENT.
The Agent, subject to Sections 7.1 and 7.3, shall receive an Opinion of
Counsel as conclusive evidence that any such consolidation, merger, sale,
assignment, transfer, lease or conveyance, and any such assumption, complies
with the provisions of this Article and that all conditions precedent hereunder
to the consummation of any such consolidation, merger, sale, assignment,
transfer, lease or conveyance have been met.
ARTICLE X
COVENANTS
SECTION 10.1. PERFORMANCE UNDER PURCHASE CONTRACTS.
The Company covenants and agrees for the benefit of the Holders from
time to time of the Securities that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.
SECTION 10.2. MAINTENANCE OF OFFICE OR AGENCY.
The Company will maintain or cause to be maintained in the Borough of
Manhattan, The City of New York an office or agency where Certificates may be
presented or surrendered for acquisition of shares of Common Stock upon
settlement of the Purchase Contracts on the Purchase Contract Settlement Date or
Early Settlement and for transfer of Collateral upon occurrence of a Termination
Event, where Certificates may be surrendered for registration of
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transfer or exchange, for a Collateral Substitution or re-establishment of an
Income PRIDES and where notices and demands to or upon the Company in respect of
the Securities and this Agreement may be served. The Company will give prompt
written notice to the Agent of the location, and any change in the location, of
such office or agency. If at any time the Company shall fail to maintain any
such required office or agency or shall fail to furnish the Agent with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the Corporate Trust Office, and the Company hereby appoints the
Agent as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more other
offices or agencies where Certificates may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York, for such purposes. The Company will
give prompt written notice to the Agent of any such designation or rescission
and of any change in the location of any such other office or agency. The
Company hereby designates as the place of payment for the Securities the
Corporate Trust Office and appoints the Agent at its Corporate Trust Office as
paying agent in such city.
SECTION 10.3. COMPANY TO RESERVE COMMON STOCK.
The Company shall at all times prior to the Purchase Contract
Settlement Date reserve and keep available, free from preemptive rights, out of
its authorized but unissued Common Stock the full number of shares of Common
Stock issuable against tender of payment in respect of all Purchase Contracts
constituting a part of the Securities evidenced by Outstanding Certificates.
SECTION 10.4. COVENANTS AS TO COMMON STOCK.
The Company covenants that all shares of Common Stock which may be
issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Securities will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
LINCOLN NATIONAL CORPORATION
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Executive Vice President and
Chief Financial Officer
By:/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Vice President and Treasurer
THE FIRST NATIONAL BANK OF
CHICAGO, as Purchase Contract
Agent
By:/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: Vice President
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EXHIBIT A
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE
NAME OF THE CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE
EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER OF
THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized representative of
The Depository Trust Company (55 ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇) to the
Company or its agent for registration of transfer, exchange or payment, and any
Certificate issued is registered in the name of Cede & Co., or such other name
as requested by an authorized representative of The Depository Trust Company,
and any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.
No. _____ Cusip No. Number of Income PRIDES
_______
Form of Face of Income PRIDES Certificate
____% Income PRIDES
This Income PRIDES Certificate certifies that ___________ is the
registered Holder of the number of Income PRIDES set forth above. Each Income
PRIDES represents (i) either (a) beneficial ownership by the Holder of one __%
Preferred Security (the "Preferred Security") of Lincoln National Capital IV, a
Delaware statutory business trust (the "Trust"), having a stated liquidation
amount of $25, subject to the Pledge of such Preferred Security by such Holder
pursuant to the Pledge Agreement or (b) upon the occurrence of a Tax Event
Redemption prior to the Purchase Contract Settlement Date, the appropriate
Applicable Ownership Interest of the Treasury Portfolio, subject to the Pledge
of such Applicable Ownership Interest of the Treasury Portfolio by such Holder
pursuant to the Pledge Agreement, and (ii) the rights and obligations of the
Holder under one Purchase Contract with Lincoln National Corporation, an Indiana
corporation (the "Company"). All capitalized terms used herein which are defined
in the Purchase Contract Agreement have the meanings set forth therein.
Pursuant to the Pledge Agreement, the Preferred Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, constituting part of each Income PRIDES evidenced hereby have been
pledged to the Collateral Agent, for the benefit of the Company, to secure the
obligations of the Holder under the Purchase Contract comprising a portion of
such Income PRIDES.
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The Pledge Agreement provides that all payments of the Stated Amount of
or the appropriate Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio, as the case may be, or
cash distributions on, any Pledged Preferred Securities (as defined in the
Pledge Agreement) or the appropriate Applicable Ownership Interest of the
Treasury Portfolio, as the case may be, constituting part of the Income PRIDES
received by the Collateral Agent shall be paid by the Collateral Agent by wire
transfer in same day funds (i) in the case of (A) cash distributions with
respect to Pledged Preferred Securities or the appropriate Applicable Ownership
Interest (as specified in clause (B) of the definition of such term) of the
Treasury Portfolio, as the case may be, and (B) any payments of the Stated
Amount or the appropriate Applicable Ownership Interest (as specified in clause
(A) of the definition of such terms) of the Treasury Portfolio, as the case may
be, with respect to any Preferred Securities or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be, that have been
released from the Pledge pursuant to the Pledge Agreement, to the Agent to the
account designated by the Agent, no later than 2:00 p.m., New York City time, on
the Business Day such payment is received by the Collateral Agent (provided that
in the event such payment is received by the Collateral Agent on a day that is
not a Business Day or after 12:30 p.m., New York City time, on a Business Day,
then such payment shall be made no later than 10:30 a.m., New York City time, on
the next succeeding Business Day) and (ii) in the case of payments of the Stated
Amount or the appropriate Applicable Ownership Interest (as specified in clause
(A) of the definition of such term) of the Treasury Portfolio, as the case may
be, of any Pledged Preferred Securities or the appropriate Applicable Ownership
Interest (as specified in clause (A) of the definition of such term) of the
Treasury Portfolio, as the case may be, to the Company on the Purchase Contract
Settlement Date (as defined herein) in accordance with the terms of the Pledge
Agreement, in full satisfaction of the respective obligations of the Holders of
the Income PRIDES of which such Pledged Preferred Securities or the Treasury
Portfolio, as the case may be, are a part under the Purchase Contracts forming a
part of such Income PRIDES. Distributions on any Preferred Security or the
appropriate Applicable Ownership Interest (as specified in clause (B) of the
definition of such term) of the Treasury Portfolio, as the case may be, forming
part of an Income PRIDES evidenced hereby, which are payable quarterly in
arrears on February 16, May 16, August 16 and November 16 each year, commencing
November 16, 1998 (a "Payment Date"), shall, subject to receipt thereof by the
Agent from the Collateral Agent, be paid to the Person in whose name this Income
PRIDES Certificate (or a Predecessor Income PRIDES 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
Income PRIDES Certificate to purchase, and the Company to sell, not later than
__________________, 2001 (the "Purchase Contract Settlement Date"), at a price
equal to $25 (the "Stated Amount"), a number of shares of Common Stock, no par
value ("Common Stock"), of the Company, equal to the Settlement Rate, unless on
or prior to the Purchase Contract Settlement Date there shall have occurred a
Termination Event or an Early Settlement with respect to the Income PRIDES of
which such Purchase Contract is a part, all as provided in the Purchase Contract
Agreement and more fully described on the reverse hereof. The purchase price
(the "Purchase Price") for the
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shares of Common Stock purchased pursuant to each Purchase Contract evidenced
hereby, if not paid earlier, shall be paid on the Purchase Contract Settlement
Date by application of payment received in respect of the Stated Amount or the
appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) of the Treasury Portfolio, as the case may be, of the
Pledged Preferred Securities or the appropriate Applicable Ownership Interest of
the Treasury Portfolio, as the case may be, pledged to secure the obligations
under such Purchase Contract of the Holder of the Income PRIDES of which such
Purchase Contract is a part.
The Company shall pay, on each Payment Date, in respect of each
Purchase Contract forming part of an Income PRIDES evidenced hereby an amount
(the "Contract Adjustment Payments") equal to ___% per annum of the Stated
Amount, computed on the basis of a 360 day year of twelve 30 day months, subject
to deferral at the option of the Company as provided in the Purchase Contract
Agreement and more fully described on the reverse hereof. Such Contract
Adjustment Payments, if any, shall be payable to the Person in whose name this
Income PRIDES Certificate (or a Predecessor Income PRIDES Certificate) is
registered at the close of business on the Record Date for such Payment Date.
Distributions on the Preferred Securities or the appropriate Applicable
Ownership Interest (as specified in clause (B) of the definition of such term)
of the Treasury Portfolio, as the case may be, and Contract Adjustment Payments,
if any, will be payable at the office of the Agent in The City of New York or,
at the option of the Company, by check mailed to the address of the Person
entitled thereto as such address appears on the Income PRIDES Register.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
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Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Income PRIDES Certificate shall not be
entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
LINCOLN NATIONAL CORPORATION
By:__________________________
Name:
Title:
By:__________________________
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts evidenced hereby)
By: THE FIRST NATIONAL BANK OF
CHICAGO not individually but
solely as Attorney-in-Fact of such
Holder
By:___________________________
Name:
Title:
Dated: , 1998
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AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Income PRIDES Certificates referred to in the within
mentioned Purchase Contract Agreement.
By: THE FIRST NATIONAL BANK OF
CHICAGO, as Purchase Contract
Agent
By:_________________________
Authorized Officer
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(Form of Reverse of Income PRIDES Certificate)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of _____, 1998 (as it may be supplemented from time
to time, the "Purchase Contract Agreement"), between the Company and The First
National Bank of Chicago, as Purchase Contract Agent (herein called the
"Agent"), to which Purchase Contract Agreement and supplemental agreements
thereto reference is hereby made for a description of the respective rights,
limitations of rights, obligations, duties and immunities thereunder of the
Agent, the Company, and the Holders and of the terms upon which the Income
PRIDES Certificates are, and are to be, executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Income PRIDES Certificate to purchase, and the Company to sell, not later than
the Purchase Contract Settlement Date at a price equal to the Stated Amount (the
"Purchase Price"), a number of shares of Common Stock of the Company equal to
the Settlement Rate, unless, on or prior to the Purchase Contract Settlement
Date, there shall have occurred a Termination Event or Early Settlement with
respect to the Security of which such Purchase Contract is a part. The
"Settlement Rate" is equal to (a) if the Applicable Market Value (as defined
below) is equal to or greater than $______ (the "Threshold Appreciation Price"),
____ shares of Common Stock per Purchase Contract, (b) if the Applicable Market
Value is less than the Threshold Appreciation Price but is greater than the
Reference Price, the number of shares of Common Stock per Purchase Contract
equal to the Stated Amount divided by the Applicable Market Value and (c) if the
Applicable Market Amount is less than or equal to $____, ____ shares of Common
Stock per Purchase Contract, in each case subject to adjustment as provided in
the Purchase Contract Agreement. No fractional shares of Common Stock will be
issued upon settlement of Purchase Contracts, as provided in the Purchase
Contract Agreement.
Each Purchase Contract evidenced hereby which is settled either through
Early Settlement or Cash Settlement shall obligate the Holder of the related
Income PRIDES to purchase at the Purchase Price, and the Company to sell, a
number of shares of Common Stock equal to the Early Settlement Rate or the
Settlement Rate, as applicable.
The "Applicable Market Value" means the average of the Closing Prices
per share of Common Stock on each of the 20 consecutive Trading Days ending on
the third Trading Day immediately preceding the Purchase Contract Settlement
Date.
The "Closing Price" of the Common Stock on any date of determination
means the closing sale price (or, if no closing price is reported, the last
reported sale price) of the Common Stock on The New York Stock Exchange, Inc.
(the "NYSE") on such date or, if the Common Stock is not listed for trading on
the NYSE on any such date, as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, or if the Common Stock is not so listed on a United States national or
regional securities exchange, as reported by the Nasdaq National Market, or, if
the Common Stock is not
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so reported, the last quoted bid price for the Common Stock in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization, or, if such bid price is not available, the market value of the
Common Stock on such date as determined by a nationally recognized independent
investment banking firm retained for this purpose by the Company. A "Trading
Day" means a day on which the Common Stock (A) is not suspended from trading on
any national or regional securities exchange or association or over-the-counter
market at the close of business and (B) has traded at least once on the national
or regional securities exchange or association or over-the-counter market that
is the primary market for the trading of the Common Stock.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Income PRIDES Certificate shall pay the Purchase Price for the
shares of Common Stock purchased pursuant to each Purchase Contract evidenced
hereby by effecting a Cash Settlement, an Early Settlement or from the proceeds
of a remarketing of the related Pledged Preferred Securities of such holders. A
Holder of Income PRIDES who does not elect, on or prior to 5:00 p.m. New York
City time on the fifth Business Day immediately preceding the Purchase Contract
Settlement Date, to make an effective Cash Settlement or an Early Settlement,
shall pay the Purchase Price for the shares of Common Stock to be issued under
the related Purchase Contract from the Proceeds of the sale of the related
Pledged Preferred Securities held by the Collateral Agent. Such sale will be
made by the Remarketing Agent pursuant to the terms of the Remarketing Agreement
and the Remarketing Underwriting Agreement on the third Business Day immediately
preceding the Purchase Contract Settlement Date. If, as provided in the Purchase
Contract Agreement, upon the occurrence of a Failed Remarketing the Collateral
Agent, for the benefit of the Company, exercises its rights as a secured
creditor with respect to the Pledged Preferred Securities related to this Income
PRIDES certificate, any accrued and unpaid distributions (including deferred
distributions) on such Pledged Preferred Securities will become payable by the
Company to the holder of this Income PRIDES Certificate in the manner provided
for in the Purchase Contract Agreement.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment in full of the aggregate purchase
price for the shares of Common Stock to be purchased thereunder in the manner
herein set forth.
Each Purchase Contract evidenced hereby and all obligations and rights
of the Company and the Holder thereunder shall terminate if a Termination Event
shall have occurred. Upon the occurrence of a Termination Event, the Company
shall give written notice to the Agent and to the Holders, at their addresses as
they appear in the Income PRIDES Register. Upon and after the occurrence of a
Termination Event, the Collateral Agent shall release the Pledged Preferred
Security (as defined in the Pledge Agreement) or the appropriate Applicable
Ownership Interest of the Treasury Portfolio forming a part of each Income
PRIDES, or the Liquidation Distribution received in respect of such Pledged
Preferred Security, from the Pledge. An Income PRIDES shall thereafter represent
the right to receive the Preferred Security or the appropriate Applicable
Ownership Interest of the Treasury Portfolio forming a part of such Income
PRIDES, or the
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Liquidation Distribution received in respect of such Preferred Security, in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Pledged
Preferred Securities. Upon receipt of notice of any meeting at which holders of
Preferred Securities are entitled to vote or upon the solicitation of consents,
waivers or proxies of holders of Preferred Securities, the Agent shall, as soon
as practicable thereafter, mail to the Income PRIDES holders a notice (a)
containing such information as is contained in the notice or solicitation, (b)
stating that each Income PRIDES holder on the record date set by the Agent
therefor (which, to the extent possible, shall be the same date as the record
date for determining the holders of Preferred Securities entitled to vote) shall
be entitled to instruct the Agent as to the exercise of the voting rights
pertaining to the Preferred Securities constituting a part of such holder's
Income PRIDES and (c) stating the manner in which such instructions may be
given. Upon the written request of the Income PRIDES Holders on such record
date, the Agent shall endeavor insofar as practicable to vote or cause to be
voted, in accordance with the instructions set forth in such requests, the
maximum number of Preferred Securities as to which any particular voting
instructions are received. In the absence of specific instructions from the
Holder of an Income PRIDES, the Agent shall abstain from voting the Preferred
Security evidenced by such Income PRIDES.
Upon the occurrence of an Investment Company Event or liquidation of
the Trust, a principal amount of the Debentures constituting the assets of the
Trust and underlying the Preferred Securities equal to the aggregate Stated
Amount of the Pledged Preferred Securities shall be delivered to the Collateral
Agent in exchange for Pledged Preferred Securities. Thereafter, the Debentures
shall be held by the Collateral Agent to secure the obligations of each Holder
of Income PRIDES to purchase shares of Common Stock under the Purchase Contracts
constituting a part of such Income PRIDES. Following the liquidation of the
Trust, the Holders and the Collateral Agent shall have such security interests,
rights and obligations with respect to the Debentures as the Holders and the
Collateral Agent had in respect of the Pledged Preferred Securities, and any
reference in the Purchase Contract Agreement or Pledge Agreement to the
Preferred Securities shall be deemed to be a reference to the Debentures.
Upon the occurrence of a Tax Event Redemption prior to the Purchase
Contract Settlement Date, the Redemption Price payable on the Tax Event
Redemption Date with respect to the Applicable Principal Amount of Debentures
shall be delivered to the Collateral Agent in exchange for the Pledged Preferred
Securities. Thereafter, pursuant to the terms of the Pledge Agreement, the
Collateral Agent for the benefit of the Company will apply an amount equal to
the Redemption Amount of such Redemption Price to purchase the Treasury
Portfolio and promptly remit the remaining portion of such Redemption Price to
the Agent for payment to the Holders of such Income PRIDES.
Following the occurrence of a Tax Event Redemption prior to the
Purchase Contract Settlement Date, the Holders of Income PRIDES and the
Collateral Agent shall have such
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security interests rights and obligations with respect to the Treasury Portfolio
as the Holder of Income PRIDES and the Collateral Agent had in respect of the
Preferred Security or Debentures, as the case may be, subject to the Pledge
thereof as provided in Articles II, III, IV, V and VI, of the Pledge Agreement
and any reference herein to the Preferred Security or the Debenture shall be
deemed to be a reference to such Treasury Portfolio.
The Income PRIDES Certificates are issuable only in registered form and
only in denominations of a single Income PRIDES and any integral multiple
thereof. The transfer of any Income PRIDES Certificate will be registered and
Income PRIDES Certificates may be exchanged as provided in the Purchase Contract
Agreement. The Income PRIDES Registrar may require a Holder, among other things,
to furnish appropriate endorsements and transfer documents permitted by the
Purchase Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Agent may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. A holder who elects to substitute Treasury
Securities for Preferred Securities or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, thereby creating Growth PRIDES, 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 an Income PRIDES remains in effect, such Income PRIDES shall
not be separable into its constituent parts, and the rights and obligations of
the Holder of such Income PRIDES in respect of Preferred Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be, and Purchase Contract constituting such Income PRIDES may be transferred
and exchanged only as an Income PRIDES. The holder of an Income PRIDES may
substitute for the Pledged Preferred Securities or the appropriate Applicable
Ownership Interest of the Treasury Portfolio securing its obligation under the
related Purchase Contract, Treasury Securities in an aggregate principal amount
equal to the aggregate Stated Amount of the Pledged Preferred Securities or the
appropriate Applicable Ownership Interest (as specified in clause (A) of the
definition of such term) in the Treasury Portfolio in accordance with the terms
of the Purchase Contract Agreement and the Pledge Agreement. From and after such
Collateral Substitution, the Security for which such Pledged Treasury Securities
secures the holder's obligation under the Purchase Contract shall be referred to
as a "Growth PRIDES." A Holder may make such Collateral Substitution only in
integral multiples of 40 Income PRIDES for 40 Growth PRIDES; provided, however,
that if a Tax Event Redemption has occurred and the Treasury Portfolio has
become a component of the Income PRIDES, a Holder may make such Collateral
Substitutions only in integral multiples of 1,600,000 Income PRIDES for
1,600,000 Growth PRIDES. Such Collateral Substitution may cause the equivalent
aggregate principal amount of this Certificate to be increased or decreased;
provided, however, the equivalent aggregate principal amount outstanding under
this Income PRIDES Certificate shall not exceed $_____________. All such
adjustments to the equivalent aggregate principal amount of this Income PRIDES
Certificate shall be duly recorded by placing an appropriate notation on the
Schedule attached hereto.
A Holder of Growth PRIDES may create or recreate Income PRIDES by
delivering to the Collateral Agent Preferred Securities or the appropriate
Applicable Ownership Interest of the
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Treasury Portfolio, with a Stated Amount, in the case of such Preferred
Securities, or with the appropriate Applicable Ownership Interest (as specified
in clause (A) of the definition of such term) of the Treasury Portfolio, in the
case of such appropriate Applicable Ownership Interest of the Treasury
Portfolio, equal to the aggregate principal amount of the Pledged Treasury
Securities in exchange for the release of such Pledged Treasury Securities in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement.
Subject to the next succeeding paragraph, the Company shall pay, on
each Payment Date, the Contract Adjustment Payments, if any, payable in respect
of each Purchase Contract to the Person in whose name the Income PRIDES
Certificate evidencing such Purchase Contract is registered at the close of
business on the Record Date for such Payment Date. Contract Adjustment Payments,
if any, will be payable at the office of the Agent in The City of New York or,
at the option of the Company, by check mailed to the address of the Person
entitled thereto at such address as it appears on the Income PRIDES Register.
The Company shall have the right, at any time prior to the Purchase
Contract Settlement Date, to defer the payment of any or all of the Contract
Adjustment Payments, if any, otherwise payable on any Payment Date, but only if
the Company shall give the Holders and the Agent written notice of its election
to defer such payment (specifying the amount to be deferred) as provided in the
Purchase Contract Agreement. Any Contract Adjustment Payments, if any, so
deferred shall bear additional Contract Adjustment Payments thereon at the rate
of ____% per annum (computed on the basis of a 360 day year of twelve 30 day
months), compounding on each succeeding Payment Date, until paid in full (such
deferred installments of Contract Adjustment Payments, if any, together with the
additional Contract Adjustment Payments accrued thereon, are referred to herein
as the "Deferred Contract Adjustment Payments"). Deferred Contract Adjustment
Payments, if any, shall be due on the next succeeding Payment Date except to the
extent that payment is deferred pursuant to the Purchase Contract Agreement. No
Contract Adjustment Payments, if any, may be deferred to a date that is after
the Purchase Contract Settlement Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments on the Purchase Contracts until the Purchase Contract
Settlement Date, the Holder of this Income PRIDES Certificate will receive on
the Purchase Contract Settlement Date, in lieu of a cash payment, a number of
shares of Common Stock equal to (x) the aggregate amount of Deferred Contract
Adjustment Payments payable to the Holder of this Income PRIDES Certificate
divided by (y) the Applicable Market Value.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, if any, then until the Deferred Contract
Adjustment Payments have been paid, the Company may not, and may not permit any
subsidiary of the Company to, (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire, or make a liquidation payment with respect to,
any of the Company's capital stock or (ii) make any payment of principal,
interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Company (including other Junior Subordinated Debt Securities)
that rank pari passu with or
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junior in interest to the Subordinated Debentures or make any guarantee payments
with respect to any guarantee by the Company of the debt securities of any
subsidiary of the Company if such guarantee ranks pari passu or junior in
interest to the Subordinated Debentures (other than (a) dividends or
distributions in Common Stock of the Company, (b) redemptions or purchases of
any rights pursuant to the Company's Rights Plan, or any successor to such
Rights Plan, and the declaration of a dividend of such rights or the issuance of
stock under such plans in the future, (c) payments under any guarantee, and (d)
purchases of Common Stock related to the issuance of Common Stock under any of
the Company's benefit plans for its directors, officers or employees).
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, if any, or any Deferred Contract Adjustment Payments, shall
immediately and automatically terminate, without the necessity of any notice or
action by any Holder, the Agent or the Company, if, on or prior to the Purchase
Contract Settlement Date, a Termination Event shall have occurred. Upon the
occurrence of a Termination Event, the Company shall promptly but in no event
later than two Business Days thereafter give written notice to the Agent, the
Collateral Agent and to the Holders, at their addresses as they appear in the
Income PRIDES Register. Upon and after the occurrence of a Termination Event,
the Collateral Agent shall release the Preferred Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,
from the Pledge in accordance with the provisions of the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
underlying Securities having an aggregate Stated Amount equal to $1,000 or an
integral multiple thereof may be settled early ("Early Settlement") as provided
in the Purchase Contract Agreement; provided, however, that if a Tax Event
Redemption has occurred and the Treasury Portfolio has become a component of the
Income PRIDES, Holders may early settle Income PRIDES only in integral multiples
of 1,600,000 Income PRIDES. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contracts evidenced by this Income
PRIDES Certificate, the Holder of this Income PRIDES Certificate shall deliver
this Income PRIDES Certificate to the Agent at the Corporate Trust Office duly
endorsed for transfer to the Company or in blank with the form of Election to
Settle Early 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 product of (A) the
Stated Amount times (B) the number of Purchase Contracts with respect to which
the Holder has elected to effect Early Settlement, plus (ii) if such delivery is
made with respect to any Purchase Contracts during the period from the close of
business on any Record Date for any Payment Date to the opening of business on
such Payment Date, an amount equal to the Contract Adjustment Payments, if any,
payable on such Payment Date with respect to such Purchase Contracts. Upon Early
Settlement of Purchase Contracts by a Holder of the related Securities, the
Pledged Preferred Securities or the appropriate Applicable Ownership Interest of
the Treasury Portfolio underlying such Securities shall be released from the
Pledge as provided in the Pledge Agreement and the Holder shall be
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entitled to receive a number of shares of Common Stock on account of each
Purchase Contract forming part of a Income PRIDES as to which Early Settlement
is effected equal to the Early Settlement Rate; provided however, that upon the
Early Settlement of the Purchase Contracts, the Holder thereof will forfeit the
right to receive any Deferred Contract Adjustment Payments and future Contract
Adjustment Payments on such Purchase Contracts. The Early Settlement Rate shall
initially be equal to _____ shares of Common Stock and shall be adjusted in the
same manner and at the same time as the Settlement Rate is adjusted as provided
in the Purchase Contract Agreement.
Upon registration of transfer of this Income PRIDES Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract Agreement
and the Purchase Contracts evidenced hereby and the transferor shall be released
from the obligations under the Purchase Contracts evidenced by this Income
PRIDES 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 Income PRIDES Certificate, by its acceptance hereof,
authorizes the Agent to enter into and perform the related Purchase Contracts
forming part of the Income PRIDES evidenced hereby on his behalf as his
attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Purchase Contracts by the Company or its trustee in the event
that the Company becomes the subject of a case under the Bankruptcy Code, agrees
to be bound by the terms and provisions thereof, covenants and agrees to perform
its obligations under such Purchase Contracts, consents to the provisions of the
Purchase Contract Agreement, authorizes the Agent to enter into and perform the
Pledge Agreement on its behalf as its attorney-in-fact, and consents to the
Pledge of the Preferred Securities or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be, underlying this Income
PRIDES 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 Stated Amount of the Pledged Preferred
Securities, or the appropriate Applicable Ownership Interest (as specified in
clause (A) of the definition of such term) of the Treasury Portfolio, on the
Purchase Contract Settlement Date shall be paid by the Collateral Agent to the
Company in satisfaction of such Holder's obligations under such Purchase
Contract and such Holder shall acquire no right, title or interest in such
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.
The Company, the Agent and its Affiliates and any agent of the Company
or the Agent may treat the Person in whose name this Income PRIDES Certificate
is registered as the owner
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of the Income PRIDES evidenced hereby for the purpose of receiving payments of
distributions payable quarterly on the Preferred Securities, receiving payments
of Contract Adjustment Payments, if any, and any Deferred Contract Adjustment
Payments, performance of the Purchase Contracts and for all other purposes
whatsoever, whether or not any payments in respect thereof be overdue and
notwithstanding any notice to the contrary, and neither the Company, the Agent
nor any such agent shall be affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Agent.
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - ------------Custodian----------------------
(cust) (minor)
Under Uniform Gifts to Minors Act
-------------------------------------------
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of
survivorship and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
---------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto
---------------------------------------------------------
------------------------------------------------------------------------------
--------
(Please insert Social Security or Taxpayer I.D. or other Identifying
Number of Assignee)
------------------------------------------------------------------------------
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______________________________________________________________________________
_________
(Please Print or Type Name and Address Including Postal Zip Code of
Assignee) the within Income PRIDES Certificates and all rights thereunder,
hereby irrevocably constituting and appointing
______________________________________________________________________________
_________
attorney to transfer said Income PRIDES Certificates on the books of
Lincoln National Corporation with full power of substitution in the premises.
Dated:
_________________ _____________________________
Signature
NOTICE: The
signature to this
assignment must
correspond with
the name as it
appears upon the
face of the within
Income PRIDES
Certificates in
every particular,
without alteration
or enlargement or
any change
whatsoever.
Signature Guarantee:
________________________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Income PRIDES evidenced
by this Income PRIDES 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)
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Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
REGISTERED HOLDER
If shares are to be registered in the name of and delivered to a Person other
than the Holder, please (i) print such Person's name and address and (ii)
provide a guarantee of your signature:
Please print name
and address of
Registered Holder:
______________________________ ______________________________
Name Name
______________________________ ______________________________
Address Address
______________________________ ______________________________
______________________________ ______________________________
______________________________ ______________________________
Social Security or other
Taxpayer Identification
Number, if any ______________________________
ELECTION TO SETTLE EARLY
The undersigned Holder of this Income PRIDES Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Income PRIDES evidenced by this Income PRIDES
Certificate specified below. The undersigned Holder directs that a certificate
for shares of Common Stock deliverable upon such Early Settlement be registered
in the name of, and delivered, together with a check in payment for any
fractional share and any Income PRIDES Certificate representing any Income
PRIDES evidenced hereby as to which Early Settlement of the related Purchase
Contracts is not effected, to the undersigned at the address indicated below
unless a different name and address have been indicated below.
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Pledged Preferred Securities or the appropriate Applicable Ownership Interest of
the Treasury Portfolio, as the case may be, deliverable upon such Early
Settlement will be transferred in accordance with the transfer instructions set
forth below. If shares are to be registered in the name of a Person other than
the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
Dated:________________________ _______________________________
Signature
Signature Guarantee:________________________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Number of Securities evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
REGISTERED HOLDER
If shares of Common Stock or
Income PRIDES Certificates are
to be registered in the name of
and delivered to and Pledged
Preferred Securities, or 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
______________________________ ______________________________
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84
______________________________ ______________________________
______________________________ ______________________________
Social Security or other
Taxpayer Identification
Number, if any ______________________________
Transfer Instructions for Pledged Preferred Securities, or the Treasury
Portfolio, as the case may be, Transferable Upon Early Settlement or a
Termination Event:
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global Certificate have
been made:
==============================================================================
====================================================================================================================
Principal Signature of
Amount of this authorized
Global office of
Amount of Amount of increase Certificate Trustee or
decrease in in Principal Amount following such Securities
Principal Amount of the Global decrease or Custodian
Date of the Global Certificate increase
Certificate
====================================================================================================================
--------------------------------------------------------------------------------------------------------------------
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--------------------------------------------------------------------------------------------------------------------
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EXHIBIT B
THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT (AS HEREINAFTER DEFINED) AND IS REGISTERED IN THE
NAME OF A CLEARING AGENCY OR A NOMINEE THEREOF. THIS CERTIFICATE MAY NOT BE
EXCHANGED IN WHOLE OR IN PART FOR A CERTIFICATE REGISTERED, AND NO TRANSFER OF
THIS CERTIFICATE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY
PERSON OTHER THAN SUCH CLEARING AGENCY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT.
Unless this Certificate is presented by an authorized representative of
The Depository Trust Company (55 ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇) to the
Company or its agent for registration of transfer, exchange or payment, and any
Certificate issued is registered in the name of Cede & Co., or such other name
as requested by an authorized representative of The Depository Trust Company,
and any payment hereon is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY A PERSON IS WRONGFUL since the registered owner
hereof, Cede & Co., has an interest herein.
No.______ Number of Growth PRIDES________ Cusip No.
Form of Face of Growth PRIDES Certificate
This Growth PRIDES Certificate certifies that __________ is the
registered Holder of the number of Growth PRIDES set forth above. Each Growth
PRIDES represents (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 Lincoln National Corporation, an Indiana corporation (the
"Company"). All capitalized terms used herein which are defined in the Purchase
Contract Agreement have the meanings set forth therein.
Pursuant to the Pledge Agreement, the Treasury Securities constituting
part of each Growth PRIDES evidenced hereby have been pledged to the Collateral
Agent, for the benefit of the Company, to secure the obligations of the Holder
under the Purchase Contract comprising a portion of such Growth PRIDES.
Each Purchase Contract evidenced hereby obligates the Holder of this
Growth PRIDES Certificate to purchase, and the Company, to sell, not later than
_______________, 2001 (the "Purchase Contract Settlement Date"), at a price
equal to $25 (the "Stated Amount"), a number of shares of Common stock, no par
value per share ("Common Stock"), of the Company equal
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to the Settlement Rate, unless on or prior to the Purchase Contract Settlement
Date there shall have occurred a Termination Event or an Early Settlement with
respect to the Growth PRIDES of which such Purchase Contract is a part, all as
provided in the Purchase Contract Agreement and more fully described on the
reverse hereof. The purchase price for the shares of Common Stock purchased
pursuant to each Purchase Contract evidenced hereby will be paid by application
of the Proceeds from the Treasury Securities pledged to secure the obligations
under such Purchase Contract in accordance with the terms of the Pledge
Agreement.
The Company shall pay on each Payment Date in respect of each Purchase
Contract evidenced hereby an amount (the "Contract Adjustment Payments") equal
to ___% per annum of the Stated Amount, computed on the basis of the actual
number of days elapsed in a year of 360 day year of twelve 30 day months, as the
case may be, subject to deferral at the option of the Company as provided in the
Purchase Contract Agreement and more fully described on the reverse hereof. Such
Contract Adjustment Payments, if any, shall be payable to the Person in whose
name this Growth PRIDES Certificate (or a Predecessor Growth PRIDES Certificate)
is registered at the close of business on the Record Date for such Payment Date.
Contract Adjustment Payments, if any, will be payable at the office of
the Agent in The City of New York or, at the option of the Company, by check
mailed to the address of the Person entitled thereto as such address appears on
the Growth PRIDES Register.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
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Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Growth PRIDES Certificate shall not be
entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
LINCOLN NATIONAL CORPORATION
By:__________________________
Name:
Title:
By:__________________________
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts evidenced hereby)
By: THE FIRST NATIONAL BANK OF
CHICAGO not individually but
solely as Attorney-in-Fact of such
Holder
By:___________________________
Name:
Title:
Dated: , 1998
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88
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Growth PRIDES referred to in the within-mentioned
Purchase Contract Agreement.
By: THE FIRST NATIONAL BANK OF
CHICAGO, as Purchase Contract Agent
By:________________________________
Authorized Signatory
(Reverse of
Growth PRIDES Certificate)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of _____, 1998 (as may be supplemented from time to
time, the "Purchase Contract Agreement") between the Company and The First
National Bank of Chicago, as Purchase Contract Agent (including its successors
thereunder, herein called the "Agent"), to which the Purchase Contract Agreement
and supplemental agreements thereto reference is hereby made for a description
of the respective rights, limitations of rights, obligations, duties and
immunities thereunder of the Agent, the Company and the Holders and of the terms
upon which the Growth PRIDES Certificates are, and are to be, executed and
delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Growth PRIDES Certificate to purchase, and the Company to sell, not later than
the Purchase Contract Settlement Date at a price equal to the Stated Amount (the
"Purchase Price") a number of shares of Common Stock of the Company equal to the
Settlement Rate, unless on or prior to the Purchase Contract Settlement Date,
there shall have occurred a Termination Event or an Early Settlement with
respect to the Security of which such Purchase Contract is a part. The
"Settlement Rate" is equal to (a) if the Applicable Market Value (as defined
below) is equal to or greater than $_____ (the "Threshold Appreciation Price"),
_____ shares of Common Stock per Purchase Contract, (b) if the Applicable Market
Value is less than the Threshold Appreciation Price but is greater than the
Reference Price, the number of shares of Common Stock per Purchase Contract
equal to the Stated Amount divided by the Applicable Market Value and (c) if the
Applicable Market Amount is less than or equal to $_____, then _____ shares of
Common Stock per Purchase Contract, in each case subject to adjustment as
provided in the Purchase Contract Agreement. No fractional shares of Common
Stock will be issued upon settlement of Purchase Contracts, as provided in the
Purchase Contract Agreement.
The "Applicable Market Value" means the average of the Closing Prices
per share of Common Stock on each of the twenty consecutive Trading Days ending
on the third Trading Day immediately preceding the Purchase Contract Settlement
Date. The "Closing Price" of the
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Common Stock on any date of determination means the closing sale price (or, if
no closing price is reported, the last reported sale price) of the Common Stock
as reported by The New York Stock Exchange, Inc. (the "NYSE") on such date or,
if the Common Stock is not listed for trading on the NYSE on any such date, as
reported in the composite transactions for the principal United States
securities exchange on which the Common Stock is so listed, or if the Common
Stock is not so listed on a United States national or regional securities
exchange, as reported by the Nasdaq National Market, or, if the Common Stock is
not so reported, the last quoted bid price for the Common Stock in the
over-the-counter market as reported by the National Quotation Bureau or similar
organization, or, if such bid price is not available, the market value of the
Common Stock on such date as determined by a nationally recognized independent
investment banking firm retained for this purpose by the Company. A "Trading
Day" means a day on which the Common Stock (A) is not suspended from trading on
any national or regional securities exchange or association or over-the-counter
market at the close of business and (B) has traded at least once on the national
or regional securities exchange or association or over-the-counter market that
is the primary market for the trading of the Common Stock.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Growth PRIDES Certificate shall pay the Purchase Price for the
shares of Common Stock purchased pursuant to each Purchase Contract evidenced
hereby by effecting either an Early Settlement of each such Purchase Contract or
by applying a principal amount of the Pledged Treasury Securities underlying
such Holder's Growth PRIDES equal to the Stated Amount of such Purchase Contract
to the purchase of the Common Stock.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment in full of the aggregate purchase
price for the shares of Common Stock to be purchased thereunder in the manner
herein set forth.
Each Purchase Contract evidenced hereby and all obligations and rights
of the Company and the Holder thereunder shall terminate if a Termination Event
shall have occurred. Upon the occurrence of a Termination Event, the Company
shall give written notice to the Agent and to the Holders, at their addresses as
they appear in the Growth PRIDES 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 Growth
PRIDES from the Pledge.
The Growth PRIDES Certificates are issuable only in registered form and
only in denominations of a single Growth PRIDES and any integral multiple
thereof. The transfer of any Growth PRIDES Certificate will be registered and
Growth PRIDES Certificates may be exchanged as provided in the Purchase Contract
Agreement. The Growth PRIDES Registrar may require a Holder, among other things,
to furnish appropriate endorsements and transfer documents permitted by the
Purchase Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Agent may require
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payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. A Holder who elects to substitute Preferred
Securities or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be, for Treasury Securities, thereby recreating
Income PRIDES, 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 Growth PRIDES remains in effect, such Growth
PRIDES shall not be separable into its constituent parts, and the rights and
obligations of the Holder of such Growth PRIDES in respect of the Treasury
Security and the Purchase Contract constituting such Growth PRIDES may be
transferred and exchanged only as a Growth PRIDES. A Holder of Growth PRIDES may
create or recreate Income PRIDES by delivering to the Collateral Agent Preferred
Securities or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, with a Stated Amount, in the case of such Preferred Securities, or
with the appropriate Applicable Ownership Interest (as specified in clause (A)
of the definition of such term) of the Treasury Portfolio, in the case of such
appropriate Applicable Ownership Interest of the Treasury Portfolio, equal to
the aggregate principal amount of the Pledged Treasury Securities in exchange
for the release of such Pledged Treasury Securities in accordance with the terms
of the Purchase Contract Agreement and the Pledge Agreement. From and after such
substitution, the Holder's Security shall be referred to as an "Income PRIDES."
Such substitution may cause the equivalent aggregate principal amount of this
Certificate to be increased or decreased; provided, however, the equivalent
aggregate principal amount outstanding under this Growth PRIDES Certificate
shall not exceed $__________. All such adjustments to the equivalent aggregate
principal amount of this Growth PRIDES Certificate shall be duly recorded by
placing an appropriate notation on the Schedule attached hereto.
A Holder of an Income PRIDES may create or recreate a Growth PRIDES by
delivering to the Collateral Agent Treasury Securities in an aggregate principal
amount equal to the aggregate Stated Amount of the Pledged Preferred Securities
or the appropriate Applicable Ownership Interest (as specified in clause (A) of
the definition of such term) of the Treasury Portfolio, as the case may be, in
exchange for the release of such Pledged Preferred Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be, in
accordance with the terms of the Purchase Contract Agreement and the Pledge
Agreement. Any such recreation of a Growth PRIDES may be effected only in
multiples of 40 Income PRIDES for 40 Growth PRIDES; provided, however, if a Tax
Event Redemption has occurred and the Treasury Portfolio has become a component
of the Income PRIDES, a Holder may make such Collateral Substitution in integral
multiples of 1,600,000 Income PRIDES for 1,600,000 Growth PRIDES.
Subject to the next succeeding paragraph, the Company shall pay, on
each Payment Date, the Contract Adjustment Payments, if any, payable in respect
of each Purchase Contract to the Person in whose name the Growth PRIDES
Certificate evidencing such Purchase Contract is registered at the close of
business on the Record Date for such Payment Date. Contract Adjustment Payments,
if any, will be payable at the office of the Agent in The City of New York or,
at the option of the Company, by check mailed to the address of the Person
entitled thereto at such address as it appears on the Growth PRIDES Register.
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The Company shall have the right, at any time prior to the Purchase
Contract Settlement Date, to defer the payment of any or all of the Contract
Adjustment Payments, if any, otherwise payable on any Payment Date, but only if
the Company shall give the Holders and the Agent written notice of its election
to defer such payment (specifying the amount to be deferred) as provided in the
Purchase Contract Agreement. Any Contract Adjustment Payments, if any, so
deferred shall bear additional Contract Adjustment Payments thereon at the rate
of ____% per annum (computed on the basis of a 360 day year of twelve 30 day
months), compounding on each succeeding Payment Date, until paid in full (such
deferred installments of Contract Adjustment Payments, if any, together with the
additional Contract Adjustment Payments accrued thereon, are referred to herein
as the "Deferred Contract Adjustment Payments"). Deferred Contract Adjustment
Payments shall be due on the next succeeding Payment Date except to the extent
that payment is deferred pursuant to the Purchase Contract Agreement. No
Contract Adjustment Payments, if any, may be deferred to a date that is after
the Purchase Contract Settlement Date.
In the event that the Company elects to defer the payment of Contract
Adjustment Payments, if any, on the Purchase Contracts until the Purchase
Contract Settlement Date, the Holder of this Growth PRIDES Certificate will
receive on the Purchase Contract Settlement Date, in lieu of a cash payment, a
number of Shares of Common Stock equal to (x) the aggregate amount of Deferred
Contract Adjustment Payments payable to the Holder of the Growth PRIDES
Certificate divided by (y) the Applicable Market Value.
In the event the Company exercises its option to defer the payment of
Contract Adjustment Payments, if any, then, until the Deferred Contract
Adjustment Payments have been paid, the Company may not, and may not permit any
subsidiary of the Company to, (i) declare or pay any dividends or distributions
on, or redeem, purchase, acquire, or make a liquidation payment with respect to,
any of the Company's capital stock or (ii) make any payment of principal,
interest or premium, if any, on or repay, repurchase or redeem any debt
securities of the Company (including other Junior Subordinated Debt Securities)
that rank pari passu with or junior in interest to the Subordinated Debentures
or make any guarantee payments with respect to any guarantee by the Company of
the debt securities of any subsidiary of the Company if such guarantee ranks
pari passu or junior in interest to the Subordinated Debentures (other than (a)
dividends or distributions in Common Stock of the Company, (b) redemptions or
purchases of any rights pursuant to the Company's Rights Plan, or any successor
to such Rights Plan, and the declaration of a dividend of such rights or the
issuance of stock under such plans in the future, (c) payments under any
guarantee, and (d) purchases of Common Stock related to the issuance of Common
Stock under any of the Company's benefit plans for its directors, officers or
employees).
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay Contract Adjustment
Payments, if any, or any Deferred Contract Adjustment Payments, shall
immediately and automatically terminate, without the necessity of
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any notice or action by any Holder, the Agent or the Company, if, on or prior to
the Purchase Contract Settlement Date, a Termination Event shall have occurred.
Upon the occurrence of a Termination Event, the Company shall promptly but in no
event later than two Business Days thereafter give written notice to the Agent,
the Collateral Agent and to the Holders, at their addresses as they appear in
the Growth PRIDES Register. Upon and after the occurrence of a Termination
Event, the Collateral Agent shall release the Treasury Securities from the
Pledge in accordance with the provisions of the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
underlying Securities having an aggregate Stated Amount equal to $1,000 or an
integral multiple thereof may be settled early ("Early Settlement") as provided
in the Purchase Contract Agreement. In order to exercise the right to effect
Early Settlement with respect to any Purchase Contracts evidenced by this Growth
PRIDES Certificate, the Holder of this Growth PRIDES Certificate shall deliver
this Growth PRIDES Certificate to the Agent at the Corporate Trust Office duly
endorsed for transfer to the Company or in blank with the form of Election to
Settle Early 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 product of (A) the
Stated Amount times (B) the number of Purchase Contracts with respect to which
the Holder has elected to effect Early Settlement, plus (ii) if such delivery is
made with respect to any Purchase Contracts during the period from the close of
business on any Record Date for any Payment Date to the opening of business on
such Payment Date, an amount equal to the Contract Adjustment Payments, if any,
payable on such Payment Date with respect to such Purchase Contracts. Upon Early
Settlement of Purchase Contracts by a Holder of the related Securities, the
Pledged Treasury Securities underlying such Securities shall be released from
the Pledge as provided in the Pledge Agreement and the Holder shall be entitled
to receive, a number of shares of Common Stock on account of each Purchase
Contract forming part of a Growth PRIDES as to which Early Settlement is
effected equal to ______ shares of Common Stock per Purchase Contract (the
"Early Settlement Rate"); provided however, that upon the Early Settlement of
the Purchase Contracts, the Holder thereof will forfeit the right to receive any
Deferred Contract Adjustment Payments and future Contract Adjustment Payments on
such Purchase Contracts. 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
the Purchase Contract Agreement.
Upon registration of transfer of this Growth PRIDES Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract Agreement
and the Purchase Contracts evidenced hereby and the transferor shall be released
from the obligations under the Purchase Contracts evidenced by this Growth
PRIDES Certificate. The Company covenants and agrees, and the Holder, by his
acceptance hereof, likewise covenants and agrees, to be bound by the provisions
of this paragraph.
The Holder of this Growth PRIDES Certificate, by its acceptance hereof,
authorizes the Agent to enter into and perform the related Purchase Contracts
forming part of the Growth
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PRIDES evidenced hereby on his behalf as its attorney-in-fact, expressly
withholds any consent to the assumption (i.e., affirmance) of the Purchase
Contracts by the Company or its trustee in the event that the Company becomes
the subject of a case under the Bankruptcy Code, agrees to be bound by the terms
and provisions thereof, covenants and agrees to perform its obligations under
such Purchase Contracts, consents to the provisions of the Purchase Contract
Agreement, authorizes the Agent to enter into and perform the Pledge Agreement
on its behalf as its attorney-in-fact, and consents to the Pledge of the
Treasury Securities underlying this Growth PRIDES 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 Stated
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.
The Company, the Agent and its Affiliates and any agent of the Company
or the Agent may treat the Person in whose name this Growth PRIDES Certificate
is registered as the owner of the Growth PRIDES evidenced hereby for the purpose
of receiving payments of interest on the Treasury Securities, receiving payments
of Contract Adjustment Payments, if any, and any Deferred Contract Adjustment
Payments, performance of the Purchase Contracts and for all other purposes
whatsoever, whether or not any payments in respect thereof be overdue and
notwithstanding any notice to the contrary, and neither the Company, the Agent
nor any such agent shall be affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection
at the offices of the Agent.
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:
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TEN COM - as tenants in common
UNIF GIFT MIN ACT - -----------Custodian------------
(cust) (minor)
Under Uniform Gifts to Minors Act
---------------------------------
(State)
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of
survivorship and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
------------------------------------------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto
----------------------------------------------------------
-----------------------------------------------------------------
(Please insert
Social Security or Taxpayer I.D. or other Identifying Number of Assignee)
--------------------------------------------------------------------------------
(Please Print or Type Name and Address Including Postal Zip Code of Assignee)
the within Growth PRIDES Certificates and all rights thereunder, hereby
irrevocably constituting and appointing
--------------------------------------------------------------------------------
attorney to transfer said Growth PRIDES Certificates on the books of Lincoln
National Corporation with full power of substitution in the premises.
Dated:
----------------- ------------------------------
Signature
NOTICE: The signature to this assignment
must correspond with the name as it appears
upon the face of the within Growth PRIDES
Certificates in every particular, without
alteration or enlargement or any change
whatsoever.
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Signature Guarantee:________________________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Growth PRIDES evidenced
by this Growth PRIDES 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:____________
Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Registrar, which requirements include membership
or participation in the Security Transfer Agent Medallion Program ("STAMP") or
such other "signature guarantee program" as may be determined by the Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
REGISTERED HOLDER
If shares are to be registered
in the name of and delivered to
a Person other the Holder,
please (i) print such Person's
name and address:
Please print name and address of Registered
Holder:
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ELECTION TO SETTLE EARLY
The undersigned Holder of this Growth PRIDES Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Growth PRIDES evidenced by this Growth PRIDES
Certificate specified below. The option to effect Early Settlement may be
exercised only with respect to Purchase Contracts underlying Growth PRIDES with
an aggregate Stated Amount equal to $1,000 or an integral multiple thereof. The
undersigned Holder directs that a certificate for shares of Common Stock
deliverable upon such Early Settlement be registered in the name of, and
delivered, together with a check in payment for any fractional share and any
Growth PRIDES Certificate representing any Growth PRIDES evidenced hereby as to
which Early Settlement of the related Purchase Contracts is not effected, to the
undersigned at the address indicated below unless a different name and address
have been indicated below. Pledged Treasury Securities deliverable upon such
Early Settlement will be transferred in accordance with the transfer
instructions set forth below. If shares are to be registered in the name of a
Person other than the undersigned, the undersigned will pay any transfer or
similar tax payable incident thereto.
Dated:________________________ _________________________________________
Signature:
Signature Guarantee:_____________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Number of Securities evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
REGISTERED HOLDER
If shares of Common Stock of
Growth PRIDES Certificates are
to be registered in the name of
and delivered to and Pledged
Treasury Securities are to be
transferred to a Person other
than the Holder, please print
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97
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 Treasury Securities Transferable Upon Early
Settlement or a Termination Event:
______________________________
______________________________
______________________________
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global
Certificate have been made:
===============================================================================
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====================================================================================================================
Principal Signature of
Amount of this authorized
Global office of
Amount of Amount of increase Certificate Trustee or
decrease in in Principal Amount following such Securities
Principal Amount of the Global decrease or Custodian
Date of the Global Certificate increase
Certificate
====================================================================================================================
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------------------------
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EXHIBIT C
INSTRUCTION FROM PURCHASE CONTRACT AGENT TO
COLLATERAL AGENT
Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Global Trust Services
Re: FELINE PRIDES of Lincoln National Corporation
(the "Company"), and Lincoln National Capital IV
We hereby notify you in accordance with Section [4.1] [4.2] of the
Pledge Agreement, dated as of August 14, 1998, among the Company, yourselves, as
Collateral Agent, and ourselves, as Purchase Contract Agent and as
attorney-in-fact for the holders of [Income PRIDES] [Growth PRIDES] from time to
time, that the holder of securities listed below (the "Holder") has elected to
substitute [$_____ aggregate [principal amount] of Treasury Securities]
[$_______ Stated Amount of Preferred Securities or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be,] in exchange
for the [Pledged Preferred Securities or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be,] [Pledged Treasury
Securities] held by you in accordance with the Pledge Agreement and has
delivered to us a notice stating that the Holder has Transferred [Treasury
Securities] [Preferred Securities or the appropriate Applicable Ownership
Interest of the Treasury Portfolio, as the case may be,] to you, as Collateral
Agent. We hereby instruct you, upon receipt of such [Pledged Treasury
Securities] [Pledged Preferred Securities or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be], and upon the
payment by such Holder of any applicable fees, to release the [Preferred
Securities or the appropriate Applicable Ownership Interest of the Treasury
Portfolio, as the case may be,] [Treasury Securities] related to such [Income
PRIDES] [Growth PRIDES] to us in accordance with the Holder's instructions.
Date: ________________________ _________________________________
By: _____________________________
Name:
Title:
Guarantee:________________________
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security
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100
Transfer Agent Medallion Program ("STAMP") or such other "signature guarantee
program" as may be determined by the Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Securities Exchange Act of
1934, as amended.
Please print name and address of Registered Holder electing to substitute
[Treasury Securities] [Preferred Securities or the appropriate Applicable
Ownership Interest of the Treasury Portfolio, as the case may be,] for the
[Pledged Preferred Securities or the appropriate Applicable Ownership Interest
of the Treasury Portfolio, as the case may be,] [Pledged Treasury Securities]:
______________________________ _________________________________
Name Social Security or other Taxpayer
Identification Number, if any
______________________________
Address
______________________________
______________________________
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EXHIBIT D
INSTRUCTION TO PURCHASE CONTRACT AGENT
The First National Bank of Chicago
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Corporate Trust Services Division
Re: FELINE PRIDES of Lincoln National Corporation
(the "Company"), and Lincoln National Capital IV
The undersigned Holder hereby notifies you that it has
delivered to The Chase Manhattan Bank, as Collateral Agent, $_______ aggregate
principal amount of [Treasury Securities] [Preferred Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be,] in exchange for the [Pledged Preferred Securities or the appropriate
Applicable Ownership Interest of the Treasury Portfolio, as the case may be,]
[Pledged Treasury Securities] held by the Collateral Agent, in accordance with
Section [4.1][4.2] of the Pledge Agreement, dated August 14, 1998, among you,
the Company and the Collateral Agent. The undersigned Holder has paid the
Collateral Agent all applicable fees relating to such exchange. The undersigned
Holder hereby instructs you to instruct the Collateral Agent to release to you
on behalf of the undersigned Holder the [Pledged Preferred Securities or the
appropriate Applicable Ownership Interest of the Treasury Portfolio, as the case
may be,] [Pledged Treasury Securities] related to such [Income PRIDES] [Growth
PRIDES].
Dated:________________________ ____________________________
Signature
Signature Guarantee:________
Please print name and address of Registered Holder:
______________________________ ____________________________
Name Social Security or other
Taxpayer Identification
Number, if any
Address
______________________________
______________________________
______________________________
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102
EXHIBIT E
NOTICE TO SETTLE BY SEPARATE CASH
The First National Bank of Chicago
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Corporate Trust Services Division
Re: FELINE PRIDES of Lincoln National Corporation
(the "Company"), and Lincoln National Capital IV
The undersigned Holder hereby irrevocably notifies you in
accordance with Section 5.9 of the Purchase Contract Agreement, dated as of
August 14, 1998 among the Company, yourselves, as Purchase Contract Agent and as
Attorney-in-Fact for the Holders of the Purchase Contracts, that such Holder has
elected to pay to the Collateral Agent, on or prior to 11:00 a.m. New York City
time, on the Business Day immediately preceding the Purchase Contract Settlement
Date, (in lawful money of the United States by [certified or cashiers check or]
wire transfer, in each case in immediately available funds), $_________ as the
Purchase Price for the shares of Common Stock issuable to such Holder by the
Company under the related Purchase Contract on the Purchase Contract Settlement
Date. The undersigned Holder hereby instructs you to notify promptly the
Collateral Agent of the undersigned Holders' election to make such cash
settlement with respect to the Purchase Contracts related to such Holder's
[Income PRIDES] [Growth PRIDES].
Dated:________________________ ___________________________
Signature
Signature Guarantee:_______
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
Please print name and address of Registered Holder:
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103
______________________________ ______________________________
Name Social Security or other
Taxpayer Identification Number,
if any
Address
______________________________
______________________________
______________________________
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