SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
February 1, 1994
Bowater Incorporated
(Exact name of registrant as specified in its charter)
Delaware 1-8712 62-0721803
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification
incorporation) No.)
55 East Camperdown Way
P.O. Box 1028
Greenville, SC 29602
(Address of principal executive offices; zip code)
Registrant's telephone number, including area code: 803 271-7733
(Former name or former address, if changed since last report)
ITEM 7: Financial Statements and Exhibits
(c) Exhibits
1.1 Purchase Agreement and Pricing Agreement, each
dated as of February 1, 1994, by and among Bowater
Incorporated, Merrill Lynch & Co. and Salomon
Brothers Inc as representives of the several
underwriters with respect to the 7% PRIDES, Series
B Convertible Preferred Stock, par value $1 per
share, of Bowater Incorporated (the "PRIDES").
1.2 Purchase Agreement and Pricing Agreement, each
dated as of February 1, 1994, by and among Bowater
Incorporated and the Representatives of the several
underwriters listed therein with respect to the
8.40% Series C Cumulative Preferred Stock, par
value $1 per share, of Bowater Incorporated (the
"Series C Stock").
4.1 Certificate of Designations of the PRIDES filed on
February 4, 1994 in the office of the Secretary of
State of Delaware.
4.2 Certificate of Designations of the Series C Stock
filed on February 4, 1994 in the office of the
Secretary of State of Delaware.
4.3 Deposit Agreement, dated as of February 1, 1994, by
and among Bowater Incorporated, Trust Company Bank,
as Depositary, and the holders from time to time of
the Depositary Receipts relating to the PRIDES.
4.4 Deposit Agreement, dated as of February 1, 1994, by
and among Bowater Incorporated, Trust Company Bank,
as Depositary, and the holders from time to time of
the Depositary Receipts relating to the Series C
Stock.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
BOWATER INCORPORATED
By: /s/ Robert C. Lancaster
---------------------------
Name: Robert C. Lancaster
Title: Senior Vice President and
Chief Financial Officer
Date: February 15, 1994
CONFORMED COPY
Bowater Incorporated
(a Delaware corporation)
4,300,000 Depositary Shares
Representing a One-Fourth
Interest in a Share of
7% PRIDES, Series B Convertible Preferred Stock,
par value $1 per share
PURCHASE AGREEMENT
February 1, 1994
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Salomon Brothers Inc
as Representatives of the several Underwriters
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Dear Sirs:
Bowater Incorporated, a Delaware corporation (the
"Company"), confirms its agreement with you and each of the
other Underwriters named in Schedule A hereto (collectively,
the "Underwriters", which term shall also include any
underwriter substituted as hereinafter provided in
Section 10) for whom you are acting as representatives (the
"Representatives"), with respect to the sale by the Company
and the purchase by the Underwriters, acting severally and
not jointly, of the respective numbers of Depositary Shares
(the "Depositary Shares"), each representing a one-fourth
interest in a share of the Company's 7% PRIDES, Series B
Convertible Preferred Stock, par value $1 per share (the
"Series B Preferred Stock"), which Series B Preferred Stock
is convertible (upon conversion or redemption of the Series
B Preferred Stock) into shares of Common Stock, par value
$1.00 per share, of the Company (including the related
rights (the "Rights") issuable pursuant to the Rights
Agreement dated as of April 22, 1986, as amended, between
the Company and The Bank of New York as successor Rights
Agent to Morgan Guaranty Trust Company of New York (the
"Rights Agreement"), the Rights and the Common Stock being
hereinafter collectively referred to as the "Common Stock",
set forth in said Schedule A and with respect to the grant
by the Company to the Underwriters, acting severally and not
jointly, of the option described in Section 2(b) hereof to
purchase up to 593,616 additional Depositary Shares to cover
over-allotments, in each case except as may otherwise be
provided in the Pricing Agreement, as hereinafter defined.
The aforesaid Depositary Shares (the "Initial Shares") and
all or any part of the 593,616 Depositary Shares subject to
the option described in Section 2(b) hereof (the "Option
Shares") are collectively hereinafter called the "Shares".
The shares of the Series B Preferred Stock are to
be deposited by or on behalf of the several Underwriters
against delivery of Depositary Receipts ("Depositary
Receipts") to be issued under a Deposit Agreement (the
"Deposit Agreement") dated as of February 1, 1994 among the
Company, Trust Company Bank, as Depositary (the
"Depositary"), and the holders from time to time of
Depositary Receipts issued thereunder. The Depositary
Receipts issued upon such deposit or deposits of the shares
of the Series B Preferred Stock will evidence the Initial
Shares and, if the option described in Section 2(b) hereof
is exercised, the Option Shares.
Prior to the purchase and public offering of the
Shares by the several Underwriters, the Company and the
Representatives, acting on behalf of the several
Underwriters, shall enter into an agreement substantially in
the form of Exhibit A hereto (the "Pricing Agreement"). The
Pricing Agreement may take the form of an exchange of any
standard form of written telecommunication between the
Company and the Representatives and shall specify such
applicable information as is indicated in Exhibit A hereto.
The offering of the Shares will be governed by this
Agreement, as supplemented by the Pricing Agreement. From
and after the date of the execution and delivery of the
Pricing Agreement, this Agreement shall be deemed to
incorporate the Pricing Agreement.
The Company has filed with the Securities and
Exchange Commission (the "Commission") a registration
statement on Form S-3 (No. 33-51569) and related preliminary
prospectuses for the registration of the Shares under the
Securities Act of 1933, as amended (the "1933 Act"), has
filed such amendments thereto, if any, and such amended
preliminary prospectuses as may have been required to the
date hereof, and will file such additional amendments
thereto and such amended prospectuses as may hereafter be
required. Such registration statement (as amended, if
applicable) and the prospectus constituting a part thereof
(including in each case all documents, if any, incorporated
or deemed to be incorporated by reference therein and the
information, if any, deemed to be part thereof pursuant to
Rule 430A(b) of the rules and regulations of the Commission
under the 1933 Act (the "1933 Act Regulations")), as from
time to time amended or supplemented pursuant to the 1933
Act, the Securities Exchange Act of 1934, as amended (the
"1934 Act") or otherwise, are hereinafter referred to as the
"Registration Statement" and the "Prospectus", respectively,
except that if any revised prospectus shall be provided to
the Underwriters by the Company for use in connection with
the offering of the Shares that differs from the Prospectus
on file at the Commission at the time the Registration
Statement becomes effective (whether or not such revised
prospectus is required to be filed by the Company pursuant
to Rule 424(b) of the 1933 Act Regulations), the term
"Prospectus" shall refer to such revised prospectus from and
after the time it is first provided to the Underwriters.
All references in this Agreement to financial statements and
schedules and other information that is "contained,"
"included" or "stated" in the Registration Statement or the
Prospectus (and all other references of like import) shall
be deemed to mean and include all such financial statements
and schedules and other information that is or is deemed to
be incorporated by reference in the Registration Statement
or the Prospectus, as the case may be; and all references in
this Agreement to amendments or supplements to the
Registration Statement or the Prospectus shall be deemed to
mean and include the filing of any document under the 1934
Act that is or is deemed to be incorporated by reference in
the Registration Statement or the Prospectus, as the case
may be.
The Company understands that the Underwriters
propose to make a public offering of the Shares as soon as
the Representatives deem advisable after the Registration
Statement becomes effective and the Pricing Agreement has
been executed and delivered. All parties to this Agreement
will exercise good faith in the performance of their
obligations under this Agreement.
SECTION 1. Representations and Warranties.
(a) The Company represents and warrants to each Underwriter
as of the date hereof and as of the date of the Pricing
Agreement (such latter date being hereinafter referred to as
the "Representation Date") as follows:
(i) The Company has been duly incorporated and
each of the Company and each active subsidiary of the
Company is validly existing as a corporation in good
standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to
own, lease and operate its properties and to conduct
its business as described in the Registration Statement
and is duly qualified as a foreign corporation to
transact business and is in good standing in each
jurisdiction in which such qualification is required
and the failure to so qualify would have a material
adverse effect on the business, operations or financial
condition of the Company; all of the issued and
outstanding capital stock of each such subsidiary has
been duly authorized and validly issued, is fully paid
and non-assessable and is owned by the Company,
directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien or
encumbrance (except as disclosed to the contrary in the
Prospectus).
(ii) At the time the Registration Statement
becomes effective, the Registration Statement will
comply in all material respects with the requirements
of the 1933 Act and the 1933 Act Regulations and will
not contain an untrue statement of a material fact or
omit to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading. The Prospectus, at the Representation Date
(unless the term "Prospectus" refers to a prospectus
that has been provided to the Underwriters by the
Company for use in connection with the offering of the
Shares that differs from the Prospectus on file at the
Commission at the time the Registration Statement
becomes effective, in which case at the time it is
first provided to the Underwriters for such use) and at
Closing Time referred to in Section 2 hereof, will not
include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the
statements therein, in the light of the circumstances
under which they were made, not misleading; provided,
however, that the representations and warranties in
this subsection shall not apply to statements in or
omissions from the Registration Statement or Prospectus
made in reliance upon and in conformity with
information furnished to the Company in writing by any
Underwriter through the Representatives set forth in
the last paragraph of the cover page, the first
paragraph of page 2, and under the heading
"Underwriting" in the Registration Statement or
Prospectus.
(iii) The documents incorporated or deemed to be
incorporated by reference in the Registration Statement
or the Prospectus, at the time they were filed or
amended, as the case may be, or hereafter are filed
with the Commission, complied or when so filed will
comply, as the case may be, in all material respects
with the requirements of the 1934 Act and the rules and
regulations of the Commission under the 1934 Act (the
"1934 Act Regulations"), and, when read together with
the other information in the Prospectus at the time the
Registration Statement and any amendments thereto
become effective, will not contain an untrue statement
of a material fact or omit to state a material fact
required to be stated therein or necessary in order to
make the statements therein, in the light of the
circumstances under which they were made, not
misleading.
(iv) Since the respective dates as of which
information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein,
(A) there has been no material adverse change in the
condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company
and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of
business, (B) there have been no transactions entered
into by the Company or any of its subsidiaries, other
than those in the ordinary course of business, that are
material with respect to the Company and its
subsidiaries considered as one enterprise, and
(C) except for regular quarterly dividends, there has
been no dividend or distribution of any kind declared,
paid or made by the Company on any class of its capital
stock.
(v) The Company is in compliance with all of the
provisions of Section 517.075 of the Florida Statutes,
and all rules and regulations promulgated thereunder
relating to issuers doing business in Cuba.
(b) Any certificate signed by any officer of the
Company and delivered to the Representatives or to counsel
for the Underwriters shall be deemed a representation and
warranty by the Company to each Underwriter as to the
matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters;
Closing. (a) On the basis of the representations and
warranties herein contained and subject to the terms and
conditions herein set forth, the Company agrees to sell to
each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase
from the Company, at the price per share set forth in the
Pricing Agreement, the number of Initial Shares set forth in
Schedule A opposite the name of such Underwriter (except as
otherwise provided in the Pricing Agreement), plus any
additional number of Initial Shares which such Underwriter
may become obligated to purchase pursuant to the provisions
of Section 10 hereof. If the Company elects to rely on
Rule 430A, Schedule A may be attached to the Pricing
Agreement.
(1) If the Company has elected not to rely upon
Rule 430A of the 1933 Act Regulations, the initial public
offering price and the purchase price per share to be paid
by the several Underwriters for the Shares have each been
determined and set forth in the Pricing Agreement, dated the
date hereof, and an amendment to the Registration Statement
and the Prospectus will be filed before the Registration
Statement becomes effective.
(2) If the Company has elected to rely upon
Rule 430A of the 1933 Act Regulations, the purchase price
per share to be paid by the several Underwriters for the
Shares shall be an amount equal to the initial public
offering price, less an amount per share to be determined by
agreement between the Representatives and the Company. The
initial public offering price per share of the Shares shall
be a fixed price to be determined by agreement between the
Representatives and the Company. The initial public
offering price and the purchase price, when so determined,
shall be set forth in the Pricing Agreement. In the event
that such prices have not been agreed upon and the Pricing
Agreement has not been executed and delivered by all parties
thereto by the close of business on the fourth business day
following the date of this Agreement, this Agreement shall
terminate forthwith, without liability of any party to any
other party, unless otherwise agreed to by the Company and
the Representatives. For purposes of this Agreement, the
term "business day" means a day on which the New York Stock
Exchange is open for business.
(b) In addition, on the basis of the
representations and warranties herein contained and subject
to the terms and conditions herein set forth, the Company
hereby grants an option to the Underwriters, severally and
not jointly, to purchase up to an additional 593,616
Depositary Shares at the price per share set forth in the
Pricing Agreement. The option hereby granted will expire
30 days after (i) the date the Registration Statement
becomes effective, if the Company has elected not to rely on
Rule 430A under the 1933 Act Regulations, or (ii) the
Representation Date, if the Company has elected to rely upon
Rule 430A under the 1933 Act Regulations, and may be
exercised in whole or in part from time to time only for the
purpose of covering over-allotments that may be made in
connection with the offering and distribution of the Initial
Shares upon notice by the Representatives to the Company
setting forth the number of Option Shares as to which the
several Underwriters are then exercising the option and the
time and date of payment and delivery for such Option
Shares. Any such time and date of delivery (a "Date of
Delivery") shall be determined by the Representatives, but
shall not be later than seven full business days and not
earlier than two full business days after the exercise of
said option, nor in any event prior to Closing Time, as
hereinafter defined, unless otherwise agreed by the
Representatives and the Company. If the option is exercised
as to all or any portion of the Option Shares, each of the
Underwriters, acting severally and not jointly, will
purchase that proportion of the total number of Option
Shares then being purchased that the number of Initial
Shares set forth in Schedule A opposite the name of such
Underwriter bears to the total number of Initial Shares
(except as otherwise provided in the Pricing Agreement),
subject in each case to such adjustments as the
Representatives in their discretion shall make to eliminate
any sales or purchases of fractional shares.
(c) Payment of the purchase price for, and
delivery of certificates for, the Initial Shares shall be
made at the offices of Cravath, Swaine & Moore, New York,
New York, or at such other place as shall be agreed upon by
the Representatives and the Company, at 10:00 A.M. on the
fifth business day (unless postponed in accordance with the
provisions of Section 10) following the date the
Registration Statement becomes effective (or, if the Company
has elected to rely upon Rule 430A of the 1933 Act
Regulations, the fifth business day after execution of the
Pricing Agreement), or such other time not later than ten
business days after such date as shall be agreed upon by the
Representatives and the Company (such time and date of
payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the Option
Shares are purchased by the Underwriters, payment of the
purchase price for, and delivery of certificates for, such
Option Shares shall be made at the above mentioned offices
of Cravath, Swaine & Moore, or at such other place as shall
be agreed upon by the Representatives and the Company, on
each Date of Delivery as specified in the notice from the
Representatives to the Company. Payment shall be made to
the Company by certified or official bank check or checks
drawn in New York Clearing House funds or similar next day
funds payable to the order of the Company, against delivery
to the Representatives for the respective accounts of the
Underwriters of certificates for the Initial Shares to be
purchased by them. Certificates for the Initial Shares and
the Option Shares, if any, shall be in such denominations
and registered in such names as the Representatives may
request in writing at least three business days before
Closing Time or the Date of Delivery, as the case may be.
It is understood that each Underwriter has authorized the
Representatives, for its account, to accept delivery of,
receipt for, and make payment of the purchase price for, the
Initial Shares that it has agreed to purchase. The
Representatives, individually and not as representatives of
the Underwriters, may (but shall not be obligated to) make
payment of the purchase price for the Initial Shares or the
Option Shares, if any, to be purchased by any Underwriter
whose check has not been received by Closing Time or the
Date of Delivery, as the case may be, but such payment shall
not relieve such Underwriter from its obligations hereunder.
The certificates for the Initial Shares and the Option
Shares, if any, will be made available for examination and
packaging by the Representatives not later than 10:00 A.M.
on the last business day prior to Closing Time or Date of
Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company
covenants with each Underwriter as follows:
(a) The Company will notify the Representatives
immediately, and confirm the notice in writing, (i) of
the effectiveness of the Registration Statement and any
amendment thereto (including any post-effective
amendment), (ii) of the receipt of any comments from
the Commission, (iii) of any request by the Commission
for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for
additional information, and (iv) of the issuance by the
Commission of any stop order suspending the
effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose. The
Company will make every reasonable effort to prevent
the issuance of any stop order and, if any stop order
is issued, to obtain the lifting thereof at the
earliest possible moment.
(b) The Company will give the Representatives
notice of its intention to file or prepare any
amendment to the Registration Statement (including any
post-effective amendment) or any amendment or
supplement to the Prospectus (including any revised
prospectus that the Company proposes for use by the
Underwriters in connection with the offering of the
Shares which differs from the prospectus on file at the
Commission at the time the Registration Statement
becomes effective, whether or not such revised
prospectus is required to be filed pursuant to Rule
424(b) of the 1933 Act Regulations), whether pursuant
to the 1933 Act, the 1934 Act or otherwise, will
furnish the Representatives with copies of any such
amendment or supplement a reasonable amount of time
prior to such proposed filing or use, as the case may
be, and will not file any such amendment or supplement
or use any such prospectus to which the Representatives
or counsel for the Underwriters shall reasonably
object.
(c) The Company will deliver to the
Representatives as many signed copies of the
Registration Statement as originally filed and of each
amendment thereto (including exhibits filed therewith
or incorporated by reference therein and documents
incorporated or deemed to be incorporated by reference
therein, as requested) as such Representatives may
reasonably request and will also deliver to the
Representatives a conformed copy of the Registration
Statement as originally filed and of each amendment
thereto (without exhibits) for each of the
Underwriters.
(d) The Company will furnish to each Underwriter,
from time to time during the period when the Prospectus
is required to be delivered under the 1933 Act or the
1934 Act, such number of copies of the Prospectus (as
amended or supplemented) as such Underwriter may
reasonably request for the purposes contemplated by the
1933 Act or the 1934 Act or the respective applicable
rules and regulations of the Commission thereunder.
(e) If any event shall occur or condition exist
as a result of which it is necessary to amend or
supplement the Prospectus in order that the Prospectus
will not include an untrue statement of a material fact
or omit to state any material fact necessary in order
to make the statements therein not misleading in the
light of the circumstances existing at the time the
Prospectus is delivered to a purchaser, the Company
will forthwith amend or supplement the Prospectus or
make appropriate filings under the 1934 Act (in form
and substance reasonably satisfactory to counsel for
the Underwriters) so that, as so amended or
supplemented, the Prospectus will not include an untrue
statement of a material fact or omit to state a
material fact necessary in order to make the statements
therein, in the light of the circumstances existing at
the time it is delivered to a purchaser, not
misleading, and the Company will furnish to the
Underwriters a reasonable number of copies of such
amendment or supplement or 1934 Act filing.
(f) The Company will endeavor, in cooperation
with the Underwriters, to qualify the Shares and the
shares of Common Stock issuable upon conversion or
redemption of the Series B Preferred Stock for offering
and sale under the applicable securities laws of such
states and other jurisdictions of the United States as
the Representatives may reasonably designate. In each
jurisdiction in which the Shares and the shares of
Common Stock issuable upon conversion or redemption of
the Series B Preferred Stock have been so qualified,
the Company, acting on advice of counsel, will file
such statements and reports as may be required by the
laws of such jurisdiction to continue such
qualification in effect for a period of not less than
one year from the effective date of the Registration
Statement.
(g) The Company will make generally available to
its security holders as soon as practicable, but not
later than 90 days after the close of the period
covered thereby, an earnings statement (which need not
be audited, but which shall be in form complying with
the provisions of Rule 158 of the 1933 Act Regulations)
covering a twelve month period beginning not later than
the first day of the Company's fiscal quarter next
following the "effective date" (as defined in said Rule
158) of the Registration Statement.
(h) If, at the time that the Registration
Statement becomes effective, any information shall have
been omitted therefrom in reliance upon Rule 430A of
the 1933 Act Regulations, then immediately following
the execution of the Pricing Agreement, the Company
will prepare, and file or transmit for filing with the
Commission in accordance with such Rule 430A and Rule
424(b) of the 1933 Act Regulations, copies of the
amended Prospectus, or, if required by such Rule 430A,
a post-effective amendment to the Registration
Statement (including amended Prospectuses), containing
all information so omitted.
(i) The Company, during the period when the
Prospectus is required to be delivered under the 1933
Act or the 1934 Act, will file all documents required
to be filed with the Commission pursuant to Sections
13, 14 or 15 of the 1934 Act within the time periods
required by the 1934 Act and the 1934 Act Regulations.
(j) The Company will use the net proceeds
received by it from the sale of the Shares in the
manner specified in the Prospectus under "Use of
Proceeds" in all material respects.
(k) The Company will not prior to the expiration
of 90 days after the date of the Pricing Agreement,
sell, offer to sell, grant any option for the sale of
or otherwise dispose of any other shares of capital
stock or securities convertible into or exchangeable
for capital stock (other than (i) the Shares including
the shares of Common Stock issuable upon conversion or
redemption of Series B Preferred Stock, (ii) the 8.40%
Series C Cumulative Preferred Stock, being offered at
approximately the same time as the Series B Preferred
Stock, (iii) the Junior Participating Preferred Stock,
Series A, and any shares of Common Stock pursuant to
the Company's Rights Plan, and (iv) the shares of
Common Stock or options for shares of Common Stock
issued pursuant to or sold in connection with the
Company's qualified employee benefit, dividend
reinvestment, and stock option and stock purchase plans
and shares of Common Stock issuable upon the conversion
of securities or the exercise of stock options or
warrants outstanding as of the date hereof) either
directly or indirectly, without prior written consent
of the Representatives.
(l) The Company will use its best efforts to
effect the listing of the Shares and the shares of
Common Stock issuable upon conversion or redemption of
the Series B Preferred Stock on the New York Stock
Exchange.
SECTION 4. Payment of Expenses. The Company will
pay all expenses incident to the performance of its
obligations under this Agreement, including (i) the printing
and filing of the Registration Statement as originally filed
and of each amendment thereto, (ii) the reproduction and
distribution of this Agreement and the Pricing Agreement,
(iii) the preparation, issuance and delivery of the
certificates for the Shares to the Underwriters, (iv) the
fees and disbursements of the Company's counsel and
accountants, (v) the qualification of the Shares and the
shares of Common Stock issuable upon conversion or
redemption of the Series B Preferred Stock under securities
laws in accordance with the provisions of Section 3(f)
hereof, including filing fees and the reasonable fees and
disbursements of counsel for the Underwriters in connection
therewith and in connection with the preparation of the Blue
Sky Survey, (vi) the printing and delivery to the
Underwriters of copies of the Registration Statement as
originally filed and of each amendment thereto, of each
preliminary prospectus, and of the Prospectus and any
amendments or supplements thereto, (vii) the reproduction
and delivery to the Underwriters of copies of the Blue Sky
Survey, and (viii) the fees and expenses incurred in
connection with the listing of the Shares and the shares of
Common Stock issuable upon conversion or redemption of the
Series B Preferred Stock on the New York Stock Exchange.
If this Agreement is terminated by the
Representatives in accordance with the provisions of
Section 5 or Section 9(a)(i), the Company shall reimburse
the Underwriters for all of their reasonable out-of-pocket
expenses, including the reasonable fees and disbursements of
counsel for the Underwriters.
SECTION 5. Conditions of Underwriters'
Obligations. The obligations of the several Underwriters
hereunder are subject to the accuracy of the representations
and warranties of the Company herein contained, to the
performance by the Company of its obligations hereunder, and
to the following further conditions:
(a) The Registration Statement shall have become
effective not later than 5:30 P.M. on the date hereof,
or with the consent of the Representatives at a later
time and date, not later, however, than 5:30 P.M. on
the first business day following the date hereof, or at
such later time and date as may be approved by a
majority in interest of the Underwriters; and at
Closing Time no stop order suspending the effectiveness
of the Registration Statement shall have been issued
under the 1933 Act or proceedings therefor initiated or
threatened by the Commission. If the Company has
elected to rely upon Rule 430A of the 1933 Act
Regulations, the price of the Shares and any price-
related information previously omitted from the
effective Registration Statement pursuant to such Rule
430A shall have been transmitted to the Commission for
filing pursuant to Rule 424(b) of the 1933 Act
Regulations within the prescribed time period, and
prior to Closing Time the Company shall have provided
evidence satisfactory to the Representatives of such
timely filing, or a post-effective amendment providing
such information shall have been promptly filed and
declared effective in accordance with the requirements
of Rule 430A of the 1933 Act Regulations.
(b) At Closing Time the Representatives shall
have received:
(1) the favorable opinion, dated as of
Closing Time of Wendy C. Shiba, Esq., Secretary
and Assistant General Counsel for the Company, in
form and substance satisfactory to counsel for the
Underwriters, to the effect that:
(i) the Company has been duly organized
and is validly existing and in good standing
under the laws of the State of Delaware with
corporate power and authority to own, lease
and operate its properties and conduct its
business as described in the Prospectus;
(ii) to the best of her knowledge and
information, the Company is duly qualified as
a foreign corporation to transact business
and is in good standing in each jurisdiction
in which such qualification is required and
the failure to so qualify would have a
material adverse effect on the business,
operations or financial condition of the
Company taken as a whole;
(iii) the authorized, issued and
outstanding capital stock of the Company is
in all material respects as set forth in the
Prospectus (except for subsequent issuances,
if any, pursuant to reservations, agreements,
employee benefit plans or the exercise of
convertible securities referred to in the
Prospectus); the Shares have been duly and
validly authorized, and, when issued and
delivered to and paid for by the Underwriters
pursuant to this Agreement, will be duly
issued by the Company and will be fully paid
and non-assessable; the Series B Preferred
Stock, Depositary Shares and Depositary
Receipts conform to the description thereof
contained in the Prospectus; the Series B
Preferred Stock is convertible into shares of
Common Stock upon conversion or redemption of
the Series B Preferred Stock in accordance
with the terms of the Series B Preferred
Stock; the shares of Common Stock initially
issuable upon conversion or redemption of the
Series B Preferred Stock have been duly and
validly authorized and reserved for issuance
upon such conversion or redemption, and, when
issued upon such conversion or redemption,
will be validly issued, fully paid and non-
assessable; such Common Stock conforms in all
material respects to the description thereof
contained in the Prospectus; the Depositary
Shares and the shares of Common Stock
issuable upon conversion or redemption of the
Series B Preferred Stock have been duly
authorized for listing, subject to official
notice of issuance and, in the case of the
Depositary Shares, evidence of satisfactory
distribution, on the New York Stock Exchange;
and the certificates for the Shares are in
valid and sufficient form under Delaware law;
(iv) the issuance of the Shares is not
subject to preemptive or other similar rights
arising by operation of law, under the
Restated Certificate of Incorporation or by-
laws of the Company or, to the best of her
knowledge and information, otherwise;
(v) the Deposit Agreement has been duly
authorized, executed and delivered by the
Company, and, assuming due authorization,
execution and delivery thereof by the
Depositary, constitutes a legal, valid and
binding instrument enforceable against the
Company in accordance with its terms
(subject, as to enforcement of remedies, to
applicable bankruptcy, reorganization,
insolvency, fraudulent transfer, moratorium
or other laws affecting creditors' rights
generally from time to time in effect and to
general principles of equity); assuming
payment of the purchase price by the
Underwriters, each Depositary Share
represents a one-fourth interest in a validly
issued, outstanding, fully paid and
nonassessable share of Series B Preferred
Stock; and the Depositary Receipts, when duly
executed and delivered in accordance with the
provisions of the Deposit Agreement will
evidence the Depositary Shares and will
entitle the holders thereof to the benefits
provided therein and in the Deposit
Agreement;
(vi) the Registration Statement has
become effective under the 1933 Act and to
the best of her knowledge no stop order
suspending the effectiveness of the
Registration Statement has been issued and no
proceeding for that purpose has been
instituted or threatened under the 1933 Act;
(vii) the Registration Statement and the
Prospectus, and any amendment or supplement
thereto, comply as to form in all material
respects with the requirements of the 1933
Act and the 1933 Act Regulations;
(viii) to the best of her knowledge there
is no pending or threatened, suit or
proceeding before any court or governmental
agency, authority or body or any arbitrator
against or involving the Company or any of
its subsidiaries, of a character required to
be disclosed in the Registration Statement
that is not adequately disclosed in the
Prospectus;
(ix) to the best of her knowledge and
information, there are no material contracts,
indentures or other instruments required to
be described or referred to in the
Registration Statement or to be filed as
exhibits thereto other than those described
or referred to therein or filed or
incorporated by reference as exhibits
thereto, and the descriptions thereof or
references thereto are correct in all
material respects;
(x) this Agreement and the Pricing
Agreement have been duly authorized, executed
and delivered by the Company; the performance
of this Agreement or the Pricing Agreement
and the consummation of the transactions
herein contemplated and the issuance and sale
of the Shares and the shares of Common Stock
issuable upon conversion or redemption of the
Series B Preferred Stock, will not result in
a breach or violation of any of the terms and
provisions of, or constitute a default under,
or result in the creation or imposition of
any lien, charge or encumbrance upon any
property or assets of the Company or any of
its active subsidiaries pursuant to, any
material contract, indenture, or other
instrument to which the Company or any of its
active subsidiaries is a party or by which it
is bound or to which any of the property of
the Company or any of its active subsidiaries
is subject, the Company's Restated
Certificate of Incorporation or by-laws, or
any order, rule or regulation known to such
counsel of any court or governmental agency
or body having jurisdiction over the Company
or any of its properties; and no consent,
approval, authorization or order of, or
filing with any court or governmental agency
or body is required for the consummation of
the transactions contemplated by this
Agreement or the Pricing Agreement, except
such as have been obtained under the 1933 Act
and such as may be required under state
securities laws in connection with the
purchase and distribution of such Shares by
the Underwriters; provided that no opinion is
called for with respect to any such consent,
approval, authorization or order required to
be obtained by any Underwriters.
In rendering such opinion, such counsel may
rely on the opinion of Richards, Layton & Finger
described in Section 5(b)(4) below as to the
matters of Delaware law covered thereby.
(2) The favorable opinion, dated as of
Closing Time, of Cravath, Swaine & Moore, counsel
for the Underwriters, with respect to the issuance
and sale of the Shares, the Registration
Statement, the Prospectus and other related
matters as the Representatives may reasonably
require.
(3) In giving their opinions required by
subsections (b)(1) and (b)(2), respectively, of
this Section, Wendy C. Shiba, Esq. and Cravath,
Swaine & Moore shall each additionally state that
nothing has come to their attention that would
lead them to believe that the Registration
Statement (except for financial statements and
schedules and other financial or statistical data
included or incorporated by reference therein, as
to which counsel need make no statement), at the
time it became effective or at the Representation
Date, contained an untrue statement of a material
fact or omitted to state a material fact required
to be stated therein or necessary to make the
statements therein not misleading or that the
Prospectus (except for financial statements and
schedules and other financial or statistical data
included or incorporated by reference therein, as
to which counsel need make no statement), at the
Representation Date (unless the term "Prospectus"
refers to a prospectus which has been provided to
the Underwriters by the Company for use in
connection with the offering of the Shares which
differs from the Prospectus on file at the
Commission at the time the Registration Statement
becomes effective, in which case at the time it is
first provided to the Underwriters for such use)
or at Closing Time, included or includes an untrue
statement of a material fact or omitted or omits
to state a material fact necessary in order to
make the statements therein, in the light of the
circumstances under which they were made, not
misleading.
(4) The favorable opinion, dated as of or
prior to Closing Time of Richards, Layton &
Finger, special Delaware counsel for the Company,
in form and substance satisfactory to counsel for
the Underwriters, to the effect that the issuance
and sale of the Series B Preferred Stock and the
Depositary Shares (i) will not result in a breach
or violation of the Company's Restated Certificate
of Incorporation, the Certificate of Designations
of the LIBOR Preferred Stock, Series A or the
Certificate of Designation, Preferences and Rights
of the Junior Participating Preferred Stock,
Series A and (ii) will not require the consent or
approval of the holders of the LIBOR Preferred
Stock, Series A.
(5) The opinion, dated as of Closing Time of
John C. Hollister, Esq., counsel for the
Depositary, to the effect that:
(i) The Deposit Agreement has been duly
authorized, executed and delivered by the
Depositary and is a valid and binding
agreement of the Depositary; and
(ii) The Depositary Receipts have been
duly executed and delivered by the Depositary
in accordance with the provisions of the
Deposit Agreement.
(c) At Closing Time, there shall not have been,
since the date hereof or since the respective dates as
of which information is given in the Registration
Statement and the Prospectus, any material adverse
change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of
the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary
course of business, and the Representatives shall have
received a certificate of the Company signed by a Vice
President or other officer and the principal financial
or principal accounting officer or treasurer of the
Company, dated as of Closing Time, to the effect that
the signers of such certificate have carefully examined
the Registration Statement, the Prospectus, any
supplement to the Prospectus and this Agreement and
that (i) there has been no such material adverse
change, (ii) the representations and warranties in
Section 1 are true and correct with the same force and
effect as though expressly made at and as of Closing
Time, (iii) the Company has complied with all
agreements and satisfied all conditions on its part to
be performed or satisfied under this Agreement at or
prior to Closing Time, and (iv) to the best knowledge
of the Company, no stop order suspending the
effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been
initiated or threatened by the Commission.
(d) At the time of the execution of this
Agreement, the Representatives shall have received from
KPMG Peat Marwick a letter dated such date, in form and
substance satisfactory to the Representatives,
confirming that they are independent accountants within
the meaning of the 1933 Act and the 1934 Act and the
respective applicable published rules and regulations
thereunder and stating in effect that:
(i) in their opinion the audited consolidated
financial statements and financial statement
schedules included or incorporated in the
Registration Statement and the Prospectus and
reported on by them comply as to form in all
material respects with the applicable accounting
requirements of the 1933 Act and the 1934 Act and
the related published rules and regulations;
(ii) on the basis of a reading of the latest
unaudited consolidated financial statements made
available by the Company; carrying out certain
specified procedures (but not an audit in
accordance with generally accepted auditing
standards) which would not necessarily reveal
matters of significance with respect to the
comments set forth in such letter; a reading of
the minutes of the meetings of the stockholders,
directors and the executive and audit committees
of the Company and the subsidiaries; and inquiries
of certain officials of the company who have
responsibility for financial and accounting
matters of the Company and its subsidiaries as to
transactions and events subsequent to December 31,
1992, nothing came to their attention which caused
them to believe that:
(1) the amounts in the unaudited
"Selected Financial and Operating Data", if
any, included in the Registration Statement
and the Prospectus do not agree with the
corresponding amounts in the audited
consolidated financial statements, unaudited
consolidated financial statements or analyses
prepared by the Company from which such
amounts were derived; or
(2) any unaudited consolidated financial
statements included or incorporated in the
Registration Statement and the Prospectus do
not comply as to form in all material
respects with applicable accounting
requirements and with the published rules and
regulations of the Commission with respect to
financial statements included or incorporated
in quarterly reports on Form 10-Q under the
1934 Act; and said unaudited consolidated
financial statements are not in conformity
with generally accepted accounting principles
applied on a basis substantially consistent
with that of the audited consolidated
financial statements included or incorporated
in the Registration Statement and the
Prospectus; or
(3) with respect to the period from the
date of the most recent consolidated
financial statements (other than any capsule
information), audited or unaudited, included
or incorporated in the Registration Statement
and the Prospectus to the date of the most
recent unaudited consolidated financial
statements prepared by the Company, there
were any changes in the consolidated long-
term debt of the Company or capital stock of
the Company or decreases in the consolidated
stockholders' equity of the Company as
compared with the amounts shown on the most
recent consolidated balance sheet included or
incorporated in the Registration Statement
and the Prospectus, or for the period from
the date of the most recent consolidated
financial statements included or incorporated
in the Registration Statement and the
Prospectus to such date there were any
decreases, as compared with the corresponding
period in the preceding year, in consolidated
income before income taxes or in total or per
share amounts of consolidated net income of
the Company, except in all instances for
changes or decreases set forth in such
letter, in which case the letter shall be
accompanied by an explanation by the Company
as to the significance thereof unless said
explanation is not deemed necessary by the
Representatives; or
(4) based solely upon discussions with
management of the Company, and subject to
such further limitations as may be required
in the circumstances, (A) with respect to the
period subsequent to the date of the most
recent unaudited consolidated financial
statements prepared by the Company, there
were any changes, at a specified date not
more than five business days prior to the
date of the letter, in the consolidated long-
term debt of the Company or capital stock of
the Company or decreases in the consolidated
stockholders' equity of the Company as
compared with the amounts shown on the most
recent consolidated balance sheet included or
incorporated in the Registration Statement
and Prospectus, or (B) for the period from
the date of the most recent consolidated
financial statements included or incorporated
in the Registration Statement and the
Prospectus to such specified date there were
any decreases, as compared with the
corresponding period in the previous year, in
consolidated income before income taxes or in
total or per share amounts of consolidated
net income of the Company, except in all
instances for changes or decreases set forth
in such letter, in which case the letter
shall be accompanied by an explanation by the
Company as to the significance thereof unless
said explanation is not deemed necessary by
the Representatives; or
(5) the amounts included in any
unaudited "capsule" information included or
incorporated in the Registration Statement
and the Prospectus do not agree with the
amounts set forth in the unaudited
consolidated financial statements for the
same periods or were not determined on a
basis substantially consistent with that of
the corresponding amounts in the audited
consolidated financial statements included or
incorporated in the Registration Statement
and the Prospectus;
(iii) they have performed certain other
specified procedures as a result of which they
determined that certain information of an
accounting, financial or statistical nature (which
is limited to accounting, financial or statistical
information derived from the general accounting
records of the Company and its subsidiaries) set
forth in the Registration Statement and the
Prospectus and in Exhibit 12.1 to the Registration
Statement, including the information set forth
under the captions "Capitalization", "Market Price
on Common Stock", "Selected Financial and
Operating Data", "Recent Developments" and
"Management's Discussion and Analysis of Financial
Condition and Results of Operations" in the
Registration Statement and the Prospectus, the
information included or incorporated in Items 1,
6, 7 and 11 of the Company's Annual Report on Form
10-K, incorporated in the Registration Statement
and the Prospectus and the information included in
the "Management's Discussion and Analysis of
Financial Condition and Results of Operations"
included or incorporated in the Company's
Quarterly Reports on Form 10-Q, incorporated in
the Registration Statement and the Prospectus (if
any), agrees with the accounting records of the
Company and its subsidiaries, excluding any
questions of legal interpretation.
References to the Prospectus in this paragraph (d)
include any supplement thereto at the date of the letter.
(e) At Closing Time, the Representatives shall
have received from KPMG Peat Marwick a letter, dated as
of Closing Time, to the effect that they reaffirm the
statements made in the letter furnished pursuant to
subsection (d) of this Section, except that the
specified date referred to shall be a date not more
than five days prior to Closing Time, and, if the
Company has elected to rely on Rule 430A of the 1933
Act Regulations, to the further effect that they have
carried out procedures as specified in clauses (ii) and
(iii) of subsection (d) of this Section with respect to
certain amounts, percentages and financial information
deemed to be a part of the Registration Statement
pursuant to Rule 430A(b).
(f) At Closing Time, the Shares and the shares of
Common Stock issuable upon conversion or redemption of
the Series B Preferred Stock shall have been approved
for listing on the New York Stock Exchange upon notice
of issuance.
(g) At Closing Time and at each Date of Delivery,
if any, counsel for the Underwriters shall have been
furnished with such documents and opinions as they may
reasonably require for the purpose of enabling them to
pass upon the issuance and sale of the Shares and the
shares of Common Stock issuable upon conversion or
redemption of the Series B Preferred Stock as
contemplated in this Agreement, the Pricing Agreement
and related proceedings, or in order to evidence the
accuracy of any of the representations or warranties,
or the fulfillment of any of the agreements or
conditions herein contained; and all proceedings taken
by the Company in connection with the issuance and sale
of the Shares as herein contemplated shall be
satisfactory in form and substance to the
Representatives and counsel for the Underwriters.
(h) At Closing Time, the Company shall have
furnished to the Representatives a letter from
Anthony P. Gammie, Donald J. D'Antuono and Richard D.
McDonough addressed to the Representatives, in which
each such person agrees not to offer, sell or contract
to sell, or otherwise dispose of, directly or
indirectly, or announce an offering of, any shares of
Common Stock beneficially owned by such person or any
securities convertible into, or exchangeable for,
shares of Common Stock for a period of 90 days
following the Closing Time without the prior written
consent of the Representatives, other than shares of
Common Stock disposed of as bona fide gifts.
(i) Subsequent to the time of the execution of
this Agreement, there shall not have been any decrease
in the rating of any of the Company's debt or equity
securities by any "nationally recognized statistical
rating organization" (as defined for purposes of
Rule 436(g) under the 1933 Act) or any notice given by
such organization of any intended or potential decrease
in any such rating or of a possible change in any such
rating that does not indicate the direction of the
possible change.
(j) In the event the Underwriters exercise their
option provided in Section 2(b) hereof to purchase all
or any portion of the Option Shares, the
representations and warranties of the Company contained
herein and the statements in any certificates furnished
by the Company hereunder shall be true and correct as
of each Date of Delivery, and the Underwriters shall
have received:
(1) A certificate, dated such Date of
Delivery, of the Company by a Vice President or
other officer and the principal financial or
principal accounting officer or treasurer, in
their capacities as such, confirming that the
certificate delivered at Closing Time pursuant to
Section 5(c) hereof remains true and correct as of
such Date of Delivery.
(2) The favorable opinion of Wendy C. Shiba,
Esq., in form and substance reasonably
satisfactory to counsel for the Underwriters,
dated such Date of Delivery, relating to the
Option Shares and otherwise to the same effect as
the opinions required by Section 5(b)(1) hereof.
(3) The favorable opinion of Cravath, Swaine
& Moore, counsel for the Underwriters, dated such
Date of Delivery, relating to the Option Shares
and otherwise to the same effect as the opinion
required by Section 5(b)(2) hereof.
(4) The opinion of John C. Hollister, Esq.,
counsel to the Depositary, dated such Date of
Delivery, to the same effect as the opinion
required by Section 5(b)(5) hereof.
(5) A letter from KPMG Peat Marwick, in form
and substance satisfactory to the Representatives
and dated such Date of Delivery, substantially the
same in scope and substance as the letter
furnished to the Representatives pursuant to
Section 5(e) hereof, except that the "specified
date" in the letter furnished pursuant to this
Section 5(j)(5) shall be a date not more than five
days prior to such Date of Delivery.
If any condition specified in this Section shall
not have been fulfilled when and as required to be
fulfilled, this Agreement may be terminated by the
Representatives by notice to the Company at any time at or
prior to Closing Time, and such termination shall be without
liability of any party to any other party except as provided
in Section 4, and provided further that Sections 6, 7 and 13
hereof shall survive such termination.
SECTION 6. Indemnification. (a) The Company
agrees to indemnify and hold harmless each Underwriter and
each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim,
damage and reasonable expense whatsoever, as incurred,
arising out of any untrue statement or alleged untrue
statement of a material fact contained in the
Registration Statement (or any amendment thereto)
including the information deemed to be part of the
Registration Statement pursuant to Rule 430A(b) of the
1933 Act Regulations, if applicable, or the omission or
alleged omission therefrom of a material fact required
to be stated therein or necessary to make the
statements therein not misleading or arising out of any
untrue statement or alleged untrue statement of a
material fact contained in the Prospectus (or any
amendment or supplement thereto) or the omission or
alleged omission therefrom of a material fact necessary
in order to make the statements therein, in the light
of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim,
damage and reasonable expense whatsoever, as incurred,
to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or
proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or
any such alleged untrue statement or omission, if such
settlement is effected with the written consent of the
Company; and
(iii) against any and all expense whatsoever, as
incurred (including, subject to Section 6(c) hereof,
the reasonable fees and disbursements of counsel chosen
by the Representatives, if applicable thereunder) that
is reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation
or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent
that any such expense is not paid under (i) or (ii)
above;
provided, however, that this indemnity agreement shall not
apply to any loss, liability, claim, damage or expense to
the extent arising out of any untrue statement or omission
or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to
the Company by any Underwriter through the Representatives
expressly for use in the Registration Statement (or any
amendment thereto) or the Prospectus (or any amendment or
supplement thereto); and provided further, that the
foregoing indemnification with respect to any preliminary
prospectus shall not inure to the benefit of the
Underwriters, or any person controlling the Underwriters,
with respect to losses, claims, liabilities or damages
asserted by any person who purchased Shares from the
Underwriters, if a copy of the Prospectus (as then amended
or supplemented if the Company shall have furnished any
amendments or supplements thereto) was not sent or given by
or on behalf of the Underwriters to such person, if required
by law so to have been delivered, at or prior to the written
confirmation of the sale of such Shares to such person, and
if the Prospectus (as so amended or supplemented) would have
cured the defect giving rise to such loss, claim, damage or
liability.
(b) Each Underwriter agrees, severally and not
jointly, to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act, against
any and all loss, liability, claim, damage and reasonable
expense described in the indemnity contained in
subsection (a) of this Section, as incurred, but only with
respect to untrue statements or omissions, or alleged untrue
statements or omissions, made in the Registration Statement
(or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Company
by such Underwriter through the Representatives expressly
for use in the Registration Statement (or any amendment
thereto) or the Prospectus (or any amendment or supplement
thereto). The Company acknowledges that the statements set
forth in the last paragraph of the cover page, the first
paragraph of page 2, and under the heading "Underwriting" in
the Registration Statement (or any amendment thereto) or the
Prospectus (or any amendment or supplement thereto)
constitute the only information furnished in writing by or
on behalf of the several Underwriters for use in the
Registration Statement (or any amendment thereto) or the
Prospectus (or any amendment or supplement thereto).
(c) Each indemnified party shall give notice as
promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure so to notify
an indemnifying party shall not relieve such indemnifying
party from any liability which it may have otherwise than on
account of this indemnity agreement. An indemnifying party
may participate at its own expense in the defense of any
such action. If it so elects within a reasonable time after
receipt of such notice, an indemnifying party, jointly with
any other indemnifying parties receiving such notice, may
assume the defense of such action with counsel chosen by it
and approved by the indemnified parties defendant in such
action, which approval shall not be unreasonably withheld,
unless such indemnified parties object to such assumption on
the ground that there may be legal defenses available to
them which are different from or in addition to those
available to such indemnifying party. If an indemnifying
party assumes the defense of such action, the indemnifying
parties shall not be liable for any fees and expenses of
counsel for the indemnified parties incurred thereafter in
connection with such action. In no event shall the
indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate
from their own counsel for all indemnified parties in
connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the
same general allegations or circumstances.
SECTION 7. Contribution. In order to provide for
just and equitable contribution in circumstances in which
the indemnity agreement provided for in Section 6 is for any
reason held to be unenforceable by the indemnified parties
although applicable in accordance with its terms, the
Company and the Underwriters shall contribute to the
aggregate losses, liabilities, claims, damages and expenses
of the nature contemplated by said indemnity agreement
incurred by the Company and one or more of the Underwriters,
as incurred, in such proportions that the Underwriters are
responsible for that portion represented by the percentage
that the underwriting discount appearing on the cover page
of the Prospectus bears to the initial public offering price
appearing thereon and the Company is responsible for the
balance; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section,
each person, if any, who controls a Underwriter within the
meaning of Section 15 of the 1933 Act shall have the same
rights to contribution as such Underwriter, and each
director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any,
who controls the Company within the meaning of Section 15 of
the 1933 Act shall have the same rights to contribution as
the Company.
SECTION 8. Representations, Warranties and
Agreements to Survive Delivery. All representations,
warranties and agreements contained in this Agreement and
the Pricing Agreement, or contained in certificates of
officers of the Company submitted pursuant hereto, shall
remain operative and in full force and effect, regardless of
any investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Company, and
shall survive delivery of the Shares to the Underwriters.
SECTION 9. Termination of Agreement. (a) The
Representatives may terminate this Agreement, by notice to
the Company, at any time at or prior to Closing Time (i) if
there has been, since the date of this Agreement or since
the respective dates as of which information is given in the
Registration Statement, any material adverse change in the
condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise, whether or
not arising in the ordinary course of business, or (ii) if
there has occurred any material adverse change in the
financial markets in the United States or any outbreak or
escalation of hostilities or other national or international
calamity or crisis, the effect of which is such as to make
it, in the judgment of the Representatives, impracticable or
inadvisable to market the Shares or to enforce contracts for
the sale of the Shares, or (iii) if trading in the Common
Stock has been suspended by the Commission or the New York
Stock Exchange, or if trading generally on the New York
Stock Exchange has been suspended, or minimum or maximum
prices for trading have been fixed, or maximum ranges for
prices for securities have been required, by said Exchange
or by order of the Commission or any other governmental
authority, or (iv) if a banking moratorium has been declared
by either federal or New York State authorities.
(b) If this Agreement is terminated pursuant to
this Section, such termination shall be without liability of
any party to any other party except as provided in
Section 4, and provided further that Sections 6, 7 and 13
hereof shall survive such termination.
SECTION 10. Default by One or More of the
Underwriters. If one or more of the Underwriters shall fail
at Closing Time to purchase the Initial Shares which it or
they are obligated to purchase under this Agreement and the
Pricing Agreement (the "Defaulted Shares"), the
Representatives shall have the right, within 24 hours
thereafter, to make arrangements for one or more of the non-
defaulting Underwriters, or any other underwriters, to
purchase all, but not less than all, of the Defaulted Shares
in such amounts as may be agreed upon and upon the terms
herein set forth; if, however, the Representatives shall not
have completed such arrangements within such 24-hour period,
then:
(a) if the number of Defaulted Shares does not
exceed 10% of the Initial Shares, each of the non-
defaulting Underwriters shall be obligated, severally
and not jointly, to purchase the full amount thereof in
the proportions that their respective underwriting
obligations hereunder bear to the underwriting
obligations of all non-defaulting Underwriters, or
(b) if the number of Defaulted Shares exceeds 10%
of the Initial Shares, this Agreement shall terminate
without liability on the part of any nondefaulting
Underwriter or the Company.
No action taken pursuant to this Section shall
relieve any defaulting Underwriter from liability in respect
of its default.
In the event of any such default which does not
result in a termination of this Agreement, either the
Representatives or the Company shall have the right to
postpone Closing Time for a period not exceeding seven days
in order to effect any changes deemed necessary or advisable
in the Registration Statement or Prospectus or in any other
documents or arrangements.
SECTION 11. Notices. All notices and other
communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed, personally
delivered or transmitted by any standard form of
telecommunication. Notices to the Underwriters shall be
directed to the Representatives in care of Merrill Lynch &
Co., North Tower, World Financial Center, New York, New York
10281-1201, Attention of Corporate Finance, 27th Floor;
notices to the Company shall be directed to it at 55 East
Camperdown Way, Post Office Box 1028, Greenville, South
Carolina 29602, Attention of Treasurer, with a copy to
Corporate Secretary.
SECTION 12. Parties. This Agreement and the
Pricing Agreement shall each inure to the benefit of and be
binding upon the Underwriters and the Company and their
respective successors. Nothing expressed or mentioned in
this Agreement or the Pricing Agreement is intended or shall
be construed to give any person, firm or corporation, other
than the Underwriters and the Company and their respective
successors and the controlling persons and officers and
directors referred to in Sections 6 and 7 and their
respective successors, heirs and legal representatives, any
legal or equitable right, remedy or claim under or in
respect of this Agreement or the Pricing Agreement or any
provision herein or therein contained. This Agreement and
the Pricing Agreement and all conditions and provisions
hereof and thereof are intended to be for the sole and
exclusive benefit of the Underwriters and the Company and
their respective successors, and said controlling persons
and officers and directors and their respective successors,
heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Shares
from any Underwriter shall be deemed to be a successor by
reason merely of such purchase.
SECTION 13. Governing Law and Time. This
Agreement and the Pricing Agreement shall be governed by and
construed in accordance with the laws of the State of New
York applicable to agreements made and to be performed in
said State. Specified times of day refer to New York City
time.
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to
the Company a counterpart hereof, whereupon this instrument,
along with all counterparts, will become a binding agreement
between the Underwriters and the Company in accordance with
its terms.
Very truly yours,
BOWATER INCORPORATED,
By /s/ DAVID G. MAFFUCCI
________________________
Name: David G. Maffucci
Title: Vice President-
Treasurer
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
SALOMON BROTHERS INC
By MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated,
By /s/ JAMES A. HISLOP
____________________________
Name: James A. Hislop
Title: Managing Director
For themselves and as Representatives of the other
Underwriters named in Schedule A hereto.
SCHEDULE A
Number of
Initial
Name of Underwriter Shares
Merrill Lynch, Pierce, Fenner & Smith
Incorporated .......................... 1,300,000
Salomon Brothers Inc .................... 1,300,000
CS First Boston Corporation ............. 850,000
J.P. Morgan Securities Inc. ............. 850,000
Total............................... 4,300,000
EXHIBIT A
BOWATER INCORPORATED
(a Delaware Corporation)
4,300,000 Depositary Shares
Representing a One-Fourth
Interest in a Share of
7% PRIDES, Series B Convertible Preferred Stock,
par value $1 per share
PRICING AGREEMENT
February 1, 1994
MERRILL LYNCH & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
SALOMON BROTHERS INC
as Representatives of the several Underwriters
named in the within-mentioned Purchase Agreement
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Dear Sirs:
Reference is made to the Purchase Agreement, dated
February 1, 1994 (the "Purchase Agreement"), relating to the
purchase by the several Underwriters named in Schedule A
thereto (the "Underwriters"), for whom Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated, and
Salomon Brothers Inc are acting as representatives (the
"Representatives"), of the Depositary Shares (the "Shares"),
representing a one-fourth interest in the 7% PRIDES, Series B
Convertible Preferred Stock, of Bowater Incorporated, a
Delaware corporation (the "Company").
Pursuant to Section 2 of the Purchase Agreement,
the Company agrees with each Underwriter as follows:
1. The initial public offering price per share
for the Shares, determined as provided in said
Section 2, shall be $23.50.
2. The purchase price per share for the Shares to
be paid by the several Underwriters shall be $22.85
being an amount equal to the initial public offering
price set forth above less $.65 per share; provided that
the purchase price per share for any Option Shares (as
defined in the Purchase Agreement) purchased upon
exercise of the over-allotment option described in
Section 2(b) of the Purchase Agreement shall be reduced
by an amount per share equal to any dividends per share
declared by the Company and payable on the Initial
Shares (as defined in the Purchase Agreement) but not
payable on the Option Shares.
3. The dividend rate on the PRIDES, Series B
Convertible Preferred Stock will be 7%.
4. Payment of the purchase price for, and delivery
of certificates for, the Shares shall be at the office
of Cravath, Swaine & Moore, New York, at 10:00 A.M. on
the fifth business day after the execution of this
Pricing Agreement.
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to the
Company a counterpart hereof, whereupon this instrument,
along with all counterparts, will become a binding agreement
between the Underwriters and the Company in accordance with
its terms.
Very truly yours,
BOWATER INCORPORATED
By /s/ DAVID G. MAFFUCCI
_________________________
Name: David G. Maffucci
Title: Vice President-
Treasurer
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
SALOMON BROTHERS INC
By MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By /s/ JAMES A. HISLOP
___________________________
Name: James A. Hislop
Title: Managing Director
For themselves and as Representatives of the other
Underwriters named in Schedule A to the Purchase Agreement.
CONFORMED COPY
Bowater Incorporated
(a Delaware corporation)
3,000,000 Depositary Shares
Representing a One-Fourth
Interest in a Share of
8.40% Series C Cumulative Preferred Stock,
par value $1 per share
PURCHASE AGREEMENT
February 1, 1994
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Salomon Brothers Inc
Kidder, Peabody & Co. Incorporated
Prudential Securities Incorporated
Smith Barney Shearson Inc.
as Representatives of the several Underwriters
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Dear Sirs:
Bowater Incorporated, a Delaware corporation (the
"Company"), confirms its agreement with you and each of the
other Underwriters named in Schedule A hereto (collectively,
the "Underwriters", which term shall also include any
underwriter substituted as hereinafter provided in
Section 10) for whom you are acting as representatives (the
"Representatives"), with respect to the sale by the Company
and the purchase by the Underwriters, acting severally and
not jointly, of the respective numbers of Depositary Shares
(the "Depositary Shares"), each representing a one-fourth
interest in a share of the Company's 8.40% Series C
Cumulative Preferred Stock, par value $1 per share, (the
"Series C Preferred Stock") set forth in said Schedule A and
with respect to the grant by the Company to the
Underwriters, acting severally and not jointly, of the
option described in Section 2(b) hereof to purchase up to
400,000 additional Depositary Shares to cover over-
allotments, in each case except as may otherwise be provided
in the Pricing Agreement, as hereinafter defined. The
aforesaid Depositary Shares (the "Initial Shares") and all
or any part of the 400,000 Depositary Shares subject to the
option described in Section 2(b) hereof (the "Option
Shares") are collectively hereinafter called the "Shares".
The shares of the Series C Preferred Stock are to
be deposited by or on behalf of the several Underwriters
against delivery of Depositary Receipts ("Depositary
Receipts") to be issued under a Deposit Agreement (the
"Deposit Agreement") dated as of February 1, 1994 among the
Company, Trust Company Bank, as Depositary (the
"Depositary"), and the holders from time to time of
Depositary Receipts issued thereunder. The Depositary
Receipts issued upon such deposit or deposits of the shares
of the Series C Preferred Stock will evidence the Initial
Shares and, if the option described in Section 2(b) hereof
is exercised, the Option Shares.
Prior to the purchase and public offering of the
Shares by the several Underwriters, the Company and the
Representatives, acting on behalf of the several
Underwriters, shall enter into an agreement substantially in
the form of Exhibit A hereto (the "Pricing Agreement"). The
Pricing Agreement may take the form of an exchange of any
standard form of written telecommunication between the
Company and the Representatives and shall specify such
applicable information as is indicated in Exhibit A hereto.
The offering of the Shares will be governed by this
Agreement, as supplemented by the Pricing Agreement. From
and after the date of the execution and delivery of the
Pricing Agreement, this Agreement shall be deemed to
incorporate the Pricing Agreement.
The Company has filed with the Securities and
Exchange Commission (the "Commission") a registration
statement on Form S-3 (No. 33-51571) and related preliminary
prospectuses for the registration of the Shares under the
Securities Act of 1933, as amended (the "1933 Act"), has
filed such amendments thereto, if any, and such amended
preliminary prospectuses as may have been required to the
date hereof, and will file such additional amendments
thereto and such amended prospectuses as may hereafter be
required. Such registration statement (as amended, if
applicable) and the prospectus constituting a part thereof
(including in each case all documents, if any, incorporated
or deemed to be incorporated by reference therein and the
information, if any, deemed to be part thereof pursuant to
Rule 430A(b) of the rules and regulations of the Commission
under the 1933 Act (the "1933 Act Regulations")), as from
time to time amended or supplemented pursuant to the 1933
Act, the Securities Exchange Act of 1934, as amended (the
"1934 Act") or otherwise, are hereinafter referred to as the
"Registration Statement" and the "Prospectus", respectively,
except that if any revised prospectus shall be provided to
the Underwriters by the Company for use in connection with
the offering of the Shares that differs from the Prospectus
on file at the Commission at the time the Registration
Statement becomes effective (whether or not such revised
prospectus is required to be filed by the Company pursuant
to Rule 424(b) of the 1933 Act Regulations), the term
"Prospectus" shall refer to such revised prospectus from and
after the time it is first provided to the Underwriters.
All references in this Agreement to financial statements and
schedules and other information that is "contained,"
"included" or "stated" in the Registration Statement or the
Prospectus (and all other references of like import) shall
be deemed to mean and include all such financial statements
and schedules and other information that is or is deemed to
be incorporated by reference in the Registration Statement
or the Prospectus, as the case may be; and all references in
this Agreement to amendments or supplements to the
Registration Statement or the Prospectus shall be deemed to
mean and include the filing of any document under the 1934
Act that is or is deemed to be incorporated by reference in
the Registration Statement or the Prospectus, as the case
may be.
The Company understands that the Underwriters
propose to make a public offering of the Shares as soon as
the Representatives deem advisable after the Registration
Statement becomes effective and the Pricing Agreement has
been executed and delivered. All parties to this Agreement
will exercise good faith in the performance of their
obligations under this Agreement.
SECTION 1. Representations and Warranties.
(a) The Company represents and warrants to each Underwriter
as of the date hereof and as of the date of the Pricing
Agreement (such latter date being hereinafter referred to as
the "Representation Date") as follows:
(i) The Company has been duly incorporated and
each of the Company and each active subsidiary of the
Company is validly existing as a corporation in good
standing under the laws of the jurisdiction of its
incorporation, has corporate power and authority to
own, lease and operate its properties and to conduct
its business as described in the Registration Statement
and is duly qualified as a foreign corporation to
transact business and is in good standing in each
jurisdiction in which such qualification is required
and the failure to so qualify would have a material
adverse effect on the business, operations or financial
condition of the Company; all of the issued and
outstanding capital stock of each such subsidiary has
been duly authorized and validly issued, is fully paid
and non-assessable and is owned by the Company,
directly or through subsidiaries, free and clear of any
security interest, mortgage, pledge, lien, or
encumbrance (except as disclosed to the contrary in the
Prospectus).
(ii) At the time the Registration Statement
becomes effective, the Registration Statement will
comply in all material respects with the requirements
of the 1933 Act and the 1933 Act Regulations and will
not contain an untrue statement of a material fact or
omit to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading. The Prospectus, at the Representation Date
(unless the term "Prospectus" refers to a prospectus
that has been provided to the Underwriters by the
Company for use in connection with the offering of the
Shares that differs from the Prospectus on file at the
Commission at the time the Registration Statement
becomes effective, in which case at the time it is
first provided to the Underwriters for such use) and at
Closing Time referred to in Section 2 hereof, will not
include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the
statements therein, in the light of the circumstances
under which they were made, not misleading; provided,
however, that the representations and warranties in
this subsection shall not apply to statements in or
omissions from the Registration Statement or Prospectus
made in reliance upon and in conformity with
information furnished to the Company in writing by any
Underwriter through the Representatives set forth in
the last paragraph of the cover page, the first
paragraph of page 2, and under the heading
"Underwriting" in the Registration Statement or
Prospectus.
(iii) The documents incorporated or deemed to be
incorporated by reference in the Registration Statement
or the Prospectus, at the time they were filed or
amended, as the case may be, or hereafter are filed
with the Commission, complied or when so filed will
comply, as the case may be, in all material respects
with the requirements of the 1934 Act and the rules and
regulations of the Commission under the 1934 Act (the
"1934 Act Regulations"), and, when read together with
the other information in the Prospectus at the time the
Registration Statement and any amendments thereto
become effective, will not contain an untrue statement
of a material fact or omit to state a material fact
required to be stated therein or necessary in order to
make the statements therein, in the light of the
circumstances under which they were made, not
misleading.
(iv) Since the respective dates as of which
information is given in the Registration Statement and
the Prospectus, except as otherwise stated therein,
(A) there has been no material adverse change in the
condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company
and its subsidiaries considered as one enterprise,
whether or not arising in the ordinary course of
business, (B) there have been no transactions entered
into by the Company or any of its subsidiaries, other
than those in the ordinary course of business, that are
material with respect to the Company and its
subsidiaries considered as one enterprise, and
(C) except for regular quarterly dividends, there has
been no dividend or distribution of any kind declared,
paid or made by the Company on any class of its capital
stock.
(v) The Company is in compliance with all of the
provisions of Section 517.075 of the Florida Statutes,
and all rules and regulations promulgated thereunder
relating to issuers doing business in Cuba.
(b) Any certificate signed by any officer of the
Company and delivered to the Representatives or to counsel
for the Underwriters shall be deemed a representation and
warranty by the Company to each Underwriter as to the
matters covered thereby.
SECTION 2. Sale and Delivery to Underwriters;
Closing. (a) On the basis of the representations and
warranties herein contained and subject to the terms and
conditions herein set forth, the Company agrees to sell to
each Underwriter, severally and not jointly, and each
Underwriter, severally and not jointly, agrees to purchase
from the Company, at the price per share set forth in the
Pricing Agreement, the number of Initial Shares set forth in
Schedule A opposite the name of such Underwriter (except as
otherwise provided in the Pricing Agreement), plus any
additional number of Initial Shares which such Underwriter
may become obligated to purchase pursuant to the provisions
of Section 10 hereof. If the Company elects to rely on
Rule 430A, Schedule A may be attached to the Pricing
Agreement.
(1) If the Company has elected not to rely upon
Rule 430A of the 1933 Act Regulations, the initial public
offering price and the purchase price per share to be paid
by the several Underwriters for the Shares have each been
determined and set forth in the Pricing Agreement, dated the
date hereof, and an amendment to the Registration Statement
and the Prospectus will be filed before the Registration
Statement becomes effective.
(2) If the Company has elected to rely upon
Rule 430A of the 1933 Act Regulations, the purchase price
per share to be paid by the several Underwriters for the
Shares shall be an amount equal to the initial public
offering price, less an amount per share to be determined by
agreement between the Representatives and the Company. The
initial public offering price per share of the Shares shall
be a fixed price to be determined by agreement between the
Representatives and the Company. The initial public
offering price and the purchase price, when so determined,
shall be set forth in the Pricing Agreement. In the event
that such prices have not been agreed upon and the Pricing
Agreement has not been executed and delivered by all parties
thereto by the close of business on the fourth business day
following the date of this Agreement, this Agreement shall
terminate forthwith, without liability of any party to any
other party, unless otherwise agreed to by the Company and
the Representatives. For purposes of this Agreement, the
term "business day" means a day on which the New York Stock
Exchange is open for business.
(b) In addition, on the basis of the
representations and warranties herein contained and subject
to the terms and conditions herein set forth, the Company
hereby grants an option to the Underwriters, severally and
not jointly, to purchase up to an additional 400,000
Depositary Shares at the price per share set forth in the
Pricing Agreement. The option hereby granted will expire
30 days after (i) the date the Registration Statement
becomes effective, if the Company has elected not to rely on
Rule 430A under the 1933 Act Regulations, or (ii) the
Representation Date, if the Company has elected to rely upon
Rule 430A under the 1933 Act Regulations, and may be
exercised in whole or in part from time to time only for the
purpose of covering over-allotments that may be made in
connection with the offering and distribution of the Initial
Shares upon notice by the Representatives to the Company
setting forth the number of Option Shares as to which the
several Underwriters are then exercising the option and the
time and date of payment and delivery for such Option
Shares. Any such time and date of delivery (a "Date of
Delivery") shall be determined by the Representatives, but
shall not be later than seven full business days and not
earlier than two full business days after the exercise of
said option, nor in any event prior to Closing Time, as
hereinafter defined, unless otherwise agreed by the
Representatives and the Company. If the option is exercised
as to all or any portion of the Option Shares, each of the
Underwriters, acting severally and not jointly, will
purchase that proportion of the total number of Option
Shares then being purchased that the number of Initial
Shares set forth in Schedule A opposite the name of such
Underwriter bears to the total number of Initial Shares
(except as otherwise provided in the Pricing Agreement),
subject in each case to such adjustments as the
Representatives in their discretion shall make to eliminate
any sales or purchases of fractional shares.
(c) Payment of the purchase price for, and
delivery of certificates for, the Initial Shares shall be
made at the offices of Cravath, Swaine & Moore, New York,
New York, or at such other place as shall be agreed upon by
the Representatives and the Company, at 10:00 A.M. on the
fifth business day (unless postponed in accordance with the
provisions of Section 10) following the date the
Registration Statement becomes effective (or, if the Company
has elected to rely upon Rule 430A of the 1933 Act
Regulations, the fifth business day after execution of the
Pricing Agreement), or such other time not later than ten
business days after such date as shall be agreed upon by the
Representatives and the Company (such time and date of
payment and delivery being herein called "Closing Time").
In addition, in the event that any or all of the Option
Shares are purchased by the Underwriters, payment of the
purchase price for, and delivery of certificates for, such
Option Shares shall be made at the above mentioned offices
of Cravath, Swaine & Moore, or at such other place as shall
be agreed upon by the Representatives and the Company, on
each Date of Delivery as specified in the notice from the
Representatives to the Company. Payment shall be made to
the Company by certified or official bank check or checks
drawn in New York Clearing House funds or similar next day
funds payable to the order of the Company, against delivery
to the Representatives for the respective accounts of the
Underwriters of certificates for the Initial Shares to be
purchased by them. Certificates for the Initial Shares and
the Option Shares, if any, shall be in such denominations
and registered in such names as the Representatives may
request in writing at least three business days before
Closing Time or the Date of Delivery, as the case may be.
It is understood that each Underwriter has authorized the
Representatives, for its account, to accept delivery of,
receipt for, and make payment of the purchase price for, the
Initial Shares that it has agreed to purchase. The
Representatives, individually and not as representatives of
the Underwriters, may (but shall not be obligated to) make
payment of the purchase price for the Initial Shares or the
Option Shares, if any, to be purchased by any Underwriter
whose check has not been received by Closing Time or the
Date of Delivery, as the case may be, but such payment shall
not relieve such Underwriter from its obligations hereunder.
The certificates for the Initial Shares and the Option
Shares, if any, will be made available for examination and
packaging by the Representatives not later than 10:00 A.M.
on the last business day prior to Closing Time or Date of
Delivery, as the case may be.
SECTION 3. Covenants of the Company. The Company
covenants with each Underwriter as follows:
(a) The Company will notify the Representatives
immediately, and confirm the notice in writing, (i) of
the effectiveness of the Registration Statement and any
amendment thereto (including any post-effective
amendment), (ii) of the receipt of any comments from
the Commission, (iii) of any request by the Commission
for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for
additional information, and (iv) of the issuance by the
Commission of any stop order suspending the
effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose. The
Company will make every reasonable effort to prevent
the issuance of any stop order and, if any stop order
is issued, to obtain the lifting thereof at the
earliest possible moment.
(b) The Company will give the Representatives
notice of its intention to file or prepare any
amendment to the Registration Statement (including any
post-effective amendment) or any amendment or
supplement to the Prospectus (including any revised
prospectus that the Company proposes for use by the
Underwriters in connection with the offering of the
Shares which differs from the prospectus on file at the
Commission at the time the Registration Statement
becomes effective, whether or not such revised
prospectus is required to be filed pursuant to Rule
424(b) of the 1933 Act Regulations), whether pursuant
to the 1933 Act, the 1934 Act or otherwise, will
furnish the Representatives with copies of any such
amendment or supplement a reasonable amount of time
prior to such proposed filing or use, as the case may
be, and will not file any such amendment or supplement
or use any such prospectus to which the Representatives
or counsel for the Underwriters shall reasonably
object.
(c) The Company will deliver to the
Representatives as many signed copies of the
Registration Statement as originally filed and of each
amendment thereto (including exhibits filed therewith
or incorporated by reference therein and documents
incorporated or deemed to be incorporated by reference
therein, as requested) as such Representatives may
reasonably request and will also deliver to the
Representatives a conformed copy of the Registration
Statement as originally filed and of each amendment
thereto (without exhibits) for each of the
Underwriters.
(d) The Company will furnish to each Underwriter,
from time to time during the period when the Prospectus
is required to be delivered under the 1933 Act or the
1934 Act, such number of copies of the Prospectus (as
amended or supplemented) as such Underwriter may
reasonably request for the purposes contemplated by the
1933 Act or the 1934 Act or the respective applicable
rules and regulations of the Commission thereunder.
(e) If any event shall occur or condition exist
as a result of which it is necessary to amend or
supplement the Prospectus in order that the Prospectus
will not include an untrue statement of a material fact
or omit to state any material fact necessary in order
to make the statements therein not misleading in the
light of the circumstances existing at the time the
Prospectus is delivered to a purchaser, the Company
will forthwith amend or supplement the Prospectus or
make appropriate filings under the 1934 Act (in form
and substance reasonably satisfactory to counsel for
the Underwriters) so that, as so amended or
supplemented, the Prospectus will not include an untrue
statement of a material fact or omit to state a
material fact necessary in order to make the statements
therein, in the light of the circumstances existing at
the time it is delivered to a purchaser, not
misleading, and the Company will furnish to the
Underwriters a reasonable number of copies of such
amendment or supplement or 1934 Act filing.
(f) The Company will endeavor, in cooperation
with the Underwriters, to qualify the Shares for
offering and sale under the applicable securities laws
of such states and other jurisdictions of the United
States as the Representatives may reasonably designate.
In each jurisdiction in which the Shares have been so
qualified, the Company, acting on advice of counsel,
will file such statements and reports as may be
required by the laws of such jurisdiction to continue
such qualification in effect for a period of not less
than one year from the effective date of the
Registration Statement.
(g) The Company will make generally available to
its security holders as soon as practicable, but not
later than 90 days after the close of the period
covered thereby, an earnings statement (which need not
be audited, but which shall be in form complying with
the provisions of Rule 158 of the 1933 Act Regulations)
covering a twelve month period beginning not later than
the first day of the Company's fiscal quarter next
following the "effective date" (as defined in said Rule
158) of the Registration Statement.
(h) If, at the time that the Registration
Statement becomes effective, any information shall have
been omitted therefrom in reliance upon Rule 430A of
the 1933 Act Regulations, then immediately following
the execution of the Pricing Agreement, the Company
will prepare, and file or transmit for filing with the
Commission in accordance with such Rule 430A and Rule
424(b) of the 1933 Act Regulations, copies of the
amended Prospectus, or, if required by such Rule 430A,
a post-effective amendment to the Registration
Statement (including amended Prospectuses), containing
all information so omitted.
(i) The Company, during the period when the
Prospectus is required to be delivered under the 1933
Act or the 1934 Act, will file all documents required
to be filed with the Commission pursuant to Sections
13, 14 or 15 of the 1934 Act within the time periods
required by the 1934 Act and the 1934 Act Regulations.
(j) The Company will use the net proceeds
received by it from the sale of the Shares in the
manner specified in the Prospectus under "Use of
Proceeds" in all material respects.
(k) The Company will not prior to the expiration
of 90 days after the date of the Pricing Agreement,
sell, offer to sell, grant any option for the sale of
or otherwise dispose of any other shares of capital
stock or securities convertible into or exchangeable
for capital stock (other than (i) the Shares, (ii) the
shares of Common Stock issuable upon conversion or
redemption of the 7% PRIDES, Series B Convertible
Preferred Stock (the "Series B Preferred Stock"), being
offered at approximately the same time as the Series C
Preferred Stock, (ii) the Series B Preferred Stock,
(iii) the Junior Participating Preferred Stock,
Series A, and any shares of Common Stock pursuant to
the Company's Rights Plan, and (iv) the shares of
Common Stock or options for shares of Common Stock
issued pursuant to or sold in connection with the
Company's qualified employee benefit, dividend
reinvestment, and stock option and stock purchase plans
and shares of Common Stock issuable upon the conversion
of securities or the exercise of stock options or
warrants outstanding as of the date hereof) either
directly or indirectly, without prior written consent
of the Representatives.
(l) The Company will use its best efforts to
effect the listing of the Shares on the New York Stock
Exchange.
SECTION 4. Payment of Expenses. The Company will
pay all expenses incident to the performance of its
obligations under this Agreement, including (i) the printing
and filing of the Registration Statement as originally filed
and of each amendment thereto, (ii) the reproduction and
distribution of this Agreement and the Pricing Agreement,
(iii) the preparation, issuance and delivery of the
certificates for the Shares to the Underwriters, (iv) the
fees and disbursements of the Company's counsel and
accountants, (v) the qualification of the Shares under
securities laws in accordance with the provisions of Section
3(f) hereof, including filing fees and the reasonable fees
and disbursements of counsel for the Underwriters in
connection therewith and in connection with the preparation
of the Blue Sky Survey, (vi) the printing and delivery to
the Underwriters of copies of the Registration Statement as
originally filed and of each amendment thereto, of each
preliminary prospectus, and of the Prospectus and any
amendments or supplements thereto, (vii) the reproduction
and delivery to the Underwriters of copies of the Blue Sky
Survey, and (viii) the fees and expenses incurred in
connection with the listing of the Shares on the New York
Stock Exchange.
If this Agreement is terminated by the
Representatives in accordance with the provisions of
Section 5 or Section 9(a)(i), the Company shall reimburse
the Underwriters for all of their reasonable out-of-pocket
expenses, including the reasonable fees and disbursements of
counsel for the Underwriters.
SECTION 5. Conditions of Underwriters'
Obligations. The obligations of the several Underwriters
hereunder are subject to the accuracy of the representations
and warranties of the Company herein contained, to the
performance by the Company of its obligations hereunder, and
to the following further conditions:
(a) The Registration Statement shall have become
effective not later than 5:30 P.M. on the date hereof,
or with the consent of the Representatives at a later
time and date, not later, however, than 5:30 P.M. on
the first business day following the date hereof, or at
such later time and date as may be approved by a
majority in interest of the Underwriters; and at
Closing Time no stop order suspending the effectiveness
of the Registration Statement shall have been issued
under the 1933 Act or proceedings therefor initiated or
threatened by the Commission. If the Company has
elected to rely upon Rule 430A of the 1933 Act
Regulations, the price of the Shares and any price-
related information previously omitted from the
effective Registration Statement pursuant to such Rule
430A shall have been transmitted to the Commission for
filing pursuant to Rule 424(b) of the 1933 Act
Regulations within the prescribed time period, and
prior to Closing Time the Company shall have provided
evidence satisfactory to the Representatives of such
timely filing, or a post-effective amendment providing
such information shall have been promptly filed and
declared effective in accordance with the requirements
of Rule 430A of the 1933 Act Regulations.
(b) At Closing Time the Representatives shall
have received:
(1) the favorable opinion, dated as of
Closing Time of Wendy C. Shiba, Esq., Secretary
and Assistant General Counsel for the Company, in
form and substance satisfactory to counsel for the
Underwriters, to the effect that:
(i) the Company has been duly organized
and is validly existing and in good standing
under the laws of the State of Delaware with
corporate power and authority to own, lease
and operate its properties and conduct its
business as described in the Prospectus;
(ii) to the best of her knowledge and
information, the Company is duly qualified as
a foreign corporation to transact business
and is in good standing in each jurisdiction
in which such qualification is required and
the failure to so qualify would have a
material adverse effect on the business,
operations or financial condition of the
Company taken as a whole;
(iii) the authorized, issued and
outstanding capital stock of the Company is
in all material respects as set forth in the
Prospectus (except for subsequent issuances,
if any, pursuant to reservations, agreements,
employee benefit plans or the exercise of
convertible securities referred to in the
Prospectus); the Shares have been duly and
validly authorized, and, when issued and
delivered to and paid for by the Underwriters
pursuant to this Agreement, will be duly
issued by the Company and will be fully paid
and non-assessable; the Series C Preferred
Stock, Depositary Shares and Depositary
Receipts conform to the description thereof
contained in the Prospectus; the Depositary
Shares have been duly authorized for listing,
subject to official notice of issuance and,
in the case of the Depositary Shares,
evidence of satisfactory distribution, on the
New York Stock Exchange; and the certificates
for the Shares are in valid and sufficient
form under Delaware law;
(iv) the issuance of the Shares is not
subject to preemptive or other similar rights
arising by operation of law, under the
Restated Certificate of Incorporation or by-
laws of the Company or, to the best of her
knowledge and information, otherwise;
(v) the Deposit Agreement has been duly
authorized, executed and delivered by the
Company, and, assuming due authorization,
execution and delivery thereof by the
Depositary, constitutes a legal, valid and
binding instrument enforceable against the
Company in accordance with its terms
(subject, as to enforcement of remedies, to
applicable bankruptcy, reorganization,
insolvency, fraudulent transfer, moratorium
or other laws affecting creditors' rights
generally from time to time in effect and to
general principles of equity); assuming
payment of the purchase price by the
Underwriters, each Depositary Share
represents a one-fourth interest in a validly
issued, outstanding, fully paid and
nonassessable share of Series C Preferred
Stock; and the Depositary Receipts, when duly
executed and delivered in accordance with the
provisions of the Deposit Agreement will
evidence the Depositary Shares and will
entitle the holders thereof to the benefits
provided therein and in the Deposit
Agreement;
(vi) the Registration Statement has
become effective under the 1933 Act and to
the best of her knowledge no stop order
suspending the effectiveness of the
Registration Statement has been issued and no
proceeding for that purpose has been
instituted or threatened under the 1933 Act;
(vii) the Registration Statement and the
Prospectus, and any amendment or supplement
thereto, comply as to form in all material
respects with the requirements of the 1933
Act and the 1933 Act Regulations;
(viii) to the best of her knowledge, there
is no pending or threatened, suit or
proceeding before any court or governmental
agency, authority or body or any arbitrator
against or involving the Company or any of
its subsidiaries, of a character required to
be disclosed in the Registration Statement
that is not adequately disclosed in the
Prospectus;
(ix) to the best of her knowledge and
information, there are no material contracts,
indentures or other instruments required to
be described or referred to in the
Registration Statement or to be filed as
exhibits thereto other than those described
or referred to therein or filed or
incorporated by reference as exhibits
thereto, and the descriptions thereof or
references thereto are correct in all
material respects;
(x) this Agreement and the Pricing
Agreement have been duly authorized, executed
and delivered by the Company; the performance
of this Agreement or the Pricing Agreement
and the consummation of the transactions
herein contemplated and the issuance and sale
of the Shares, will not result in a breach or
violation of any of the terms and provisions
of, or constitute a default under, or result
in the creation or imposition of any lien,
charge or encumbrance upon any property or
assets of the Company or any of its active
subsidiaries pursuant to, any material
contract, indenture or other instrument to
which the Company or any of its active
subsidiaries is a party or by which it is
bound or to which any of the property of the
Company or any of its active subsidiaries is
subject, the Company's Restated Certificate
of Incorporation or by-laws, or any order,
rule or regulation known to such counsel of
any court or governmental agency or body
having jurisdiction over the Company or any
of its properties; and no consent, approval,
authorization or order of, or filing with any
court or governmental agency or body is
required for the consummation of the
transactions contemplated by this Agreement
or the Pricing Agreement, except such as have
been obtained under the 1933 Act and such as
may be required under state securities laws
in connection with the purchase and
distribution of such Shares by the
Underwriters; provided that no opinion is
called for with respect to any such consent,
approval, authorization or order required to
be obtained by any Underwriters.
In rendering such opinion, such counsel may
rely on the opinion of Richards, Layton & Finger
described in Section 5(b)(4) below as to the
matters of Delaware law covered thereby.
(2) The favorable opinion, dated as of
Closing Time, of Cravath, Swaine & Moore, counsel
for the Underwriters, with respect to the issuance
and sale of the Shares, the Registration
Statement, the Prospectus and other related
matters as the Representatives may reasonably
require.
(3) In giving their opinions required by
subsections (b)(1) and (b)(2), respectively, of
this Section, Wendy C. Shiba, Esq. and Cravath,
Swaine & Moore shall each additionally state that
nothing has come to their attention that would
lead them to believe that the Registration
Statement (except for financial statements and
schedules and other financial or statistical data
included or incorporated by reference therein, as
to which counsel need make no statement), at the
time it became effective or at the Representation
Date, contained an untrue statement of a material
fact or omitted to state a material fact required
to be stated therein or necessary to make the
statements therein not misleading or that the
Prospectus (except for financial statements and
schedules and other financial or statistical data
included or incorporated by reference therein, as
to which counsel need make no statement), at the
Representation Date (unless the term "Prospectus"
refers to a prospectus which has been provided to
the Underwriters by the Company for use in
connection with the offering of the Shares which
differs from the Prospectus on file at the
Commission at the time the Registration Statement
becomes effective, in which case at the time it is
first provided to the Underwriters for such use)
or at Closing Time, included or includes an untrue
statement of a material fact or omitted or omits
to state a material fact necessary in order to
make the statements therein, in the light of the
circumstances under which they were made, not
misleading.
(4) The favorable opinion, dated as of or
prior to Closing Time of Richards, Layton &
Finger, special Delaware counsel for the Company,
in form and substance satisfactory to counsel for
the Underwriters, to the effect that the issuance
and sale of the Series C Preferred Stock and the
Depositary Shares (i) will not result in a breach
or violation of the Company's Restated Certificate
of Incorporation, the Certificate of Designations
of the LIBOR Preferred Stock, Series A or the
Certificate of Designation, Preferences and Rights
of the Junior Participating Preferred Stock,
Series A and (ii) will not require the consent or
approval of the holders of the LIBOR Preferred
Stock, Series A.
(5) The opinion, dated as of Closing Time of
John C. Hollister, Esq., counsel for the
Depositary, to the effect that:
(i) The Deposit Agreement has been duly
authorized, executed and delivered by the
Depositary and is a valid and binding
agreement of the Depositary; and
(ii) The Depositary Receipts have been
duly executed and delivered by the Depositary
in accordance with the provisions of the
Deposit Agreement.
(c) At Closing Time, there shall not have been,
since the date hereof or since the respective dates as
of which information is given in the Registration
Statement and the Prospectus, any material adverse
change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of
the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary
course of business, and the Representatives shall have
received a certificate of the Company signed by a Vice
President or other officer and the principal financial
or principal accounting officer or treasurer of the
Company, dated as of Closing Time, to the effect that
the signers of such certificate have carefully examined
the Registration Statement, the Prospectus, any
supplement to the Prospectus and this Agreement and
that (i) there has been no such material adverse
change, (ii) the representations and warranties in
Section 1 are true and correct with the same force and
effect as though expressly made at and as of Closing
Time, (iii) the Company has complied with all
agreements and satisfied all conditions on its part to
be performed or satisfied under this Agreement at or
prior to Closing Time, and (iv) to the best knowledge
of the Company, no stop order suspending the
effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been
initiated or threatened by the Commission.
(d) At the time of the execution of this
Agreement, the Representatives shall have received from
KPMG Peat Marwick a letter dated such date, in form and
substance satisfactory to the Representatives,
confirming that they are independent accountants within
the meaning of the 1933 Act and the 1934 Act and the
respective applicable published rules and regulations
thereunder and stating in effect that:
(i) in their opinion the audited consolidated
financial statements and financial statement
schedules included or incorporated in the
Registration Statement and the Prospectus and
reported on by them comply as to form in all
material respects with the applicable accounting
requirements of the 1933 Act and the 1934 Act and
the related published rules and regulations;
(ii) on the basis of a reading of the latest
unaudited consolidated financial statements made
available by the Company; carrying out certain
specified procedures (but not an audit in
accordance with generally accepted auditing
standards) which would not necessarily reveal
matters of significance with respect to the
comments set forth in such letter; a reading of
the minutes of the meetings of the stockholders,
directors and the executive and audit committees
of the Company and the subsidiaries; and inquiries
of certain officials of the company who have
responsibility for financial and accounting
matters of the Company and its subsidiaries as to
transactions and events subsequent to December 31,
1992, nothing came to their attention which caused
them to believe that:
(1) the amounts in the unaudited
"Selected Financial and Operating Data", if
any, included in the Registration Statement
and the Prospectus do not agree with the
corresponding amounts in the audited
consolidated financial statements, unaudited
consolidated financial statements or analyses
prepared by the Company from which such
amounts were derived; or
(2) any unaudited consolidated financial
statements included or incorporated in the
Registration Statement and the Prospectus do
not comply as to form in all material
respects with applicable accounting
requirements and with the published rules and
regulations of the Commission with respect to
financial statements included or incorporated
in quarterly reports on Form 10-Q under the
1934 Act; and said unaudited consolidated
financial statements are not in conformity
with generally accepted accounting principles
applied on a basis substantially consistent
with that of the audited consolidated
financial statements included or incorporated
in the Registration Statement and the
Prospectus; or
(3) with respect to the period from the
date of the most recent consolidated
financial statements (other than any capsule
information), audited or unaudited, included
or incorporated in the Registration Statement
and the Prospectus to the date of the most
recent unaudited consolidated financial
statements prepared by the Company, there
were any changes in the consolidated long-
term debt of the Company or capital stock of
the Company or decreases in the consolidated
stockholders' equity of the Company as
compared with the amounts shown on the most
recent consolidated balance sheet included or
incorporated in the Registration Statement
and the Prospectus, or for the period from
the date of the most recent consolidated
financial statements included or incorporated
in the Registration Statement and the
Prospectus to such date there were any
decreases, as compared with the corresponding
period in the preceding year, in consolidated
income before income taxes or in total or per
share amounts of consolidated net income of
the Company, except in all instances for
changes or decreases set forth in such
letter, in which case the letter shall be
accompanied by an explanation by the Company
as to the significance thereof unless said
explanation is not deemed necessary by the
Representatives; or
(4) based solely upon discussions with
management of the Company, and subject to
such further limitations as may be required
in the circumstances, (A) with respect to the
period subsequent to the date of the most
recent unaudited consolidated financial
statements prepared by the Company, there
were any changes, at a specified date not
more than five business days prior to the
date of the letter, in the consolidated long-
term debt of the Company or capital stock of
the Company or decreases in the consolidated
stockholders' equity of the Company as
compared with the amounts shown on the most
recent consolidated balance sheet included or
incorporated in the Registration Statement
and Prospectus, or (B) for the period from
the date of the most recent consolidated
financial statements included or incorporated
in the Registration Statement and the
Prospectus to such specified date there were
any decreases, as compared with the
corresponding period in the previous year, in
consolidated income before income taxes or in
total or per share amounts of consolidated
net income of the Company, except in all
instances for changes or decreases set forth
in such letter, in which case the letter
shall be accompanied by an explanation by the
Company as to the significance thereof unless
said explanation is not deemed necessary by
the Representatives; or
(5) the amounts included in any
unaudited "capsule" information included or
incorporated in the Registration Statement
and the Prospectus do not agree with the
amounts set forth in the unaudited
consolidated financial statements for the
same periods or were not determined on a
basis substantially consistent with that of
the corresponding amounts in the audited
consolidated financial statements included or
incorporated in the Registration Statement
and the Prospectus;
(iii) they have performed certain other
specified procedures as a result of which they
determined that certain information of an
accounting, financial or statistical nature (which
is limited to accounting, financial or statistical
information derived from the general accounting
records of the Company and its subsidiaries) set
forth in the Registration Statement and the
Prospectus and in Exhibit 12.1 to the Registration
Statement, including the information set forth
under the captions "Capitalization", "Market Price
of Common Stock", "Selected Financial and
Operating Data", "Recent Developments" and
"Management's Discussion and Analysis of Financial
Condition and Results of Operations" in the
Registration Statement and the Prospectus, the
information included or incorporated in Items 1,
6, 7 and 11 of the Company's Annual Report on Form
10-K, incorporated in the Registration Statement
and the Prospectus and the information included in
the "Management's Discussion and Analysis of
Financial Condition and Results of Operations"
included or incorporated in the Company's
Quarterly Reports on Form 10-Q, incorporated in
the Registration Statement and the Prospectus (if
any), agrees with the accounting records of the
Company and its subsidiaries, excluding any
questions of legal interpretation.
References to the Prospectus in this paragraph (d)
include any supplement thereto at the date of the letter.
(e) At Closing Time, the Representatives shall
have received from KPMG Peat Marwick a letter, dated as
of Closing Time, to the effect that they reaffirm the
statements made in the letter furnished pursuant to
subsection (d) of this Section, except that the
specified date referred to shall be a date not more
than five days prior to Closing Time, and, if the
Company has elected to rely on Rule 430A of the 1933
Act Regulations, to the further effect that they have
carried out procedures as specified in clauses (ii) and
(iii) of subsection (d) of this Section with respect to
certain amounts, percentages and financial information
deemed to be a part of the Registration Statement
pursuant to Rule 430A(b).
(f) At Closing Time, the Shares shall have been
approved for listing on the New York Stock Exchange
upon notice of issuance.
(g) At Closing Time and at each Date of Delivery,
if any, counsel for the Underwriters shall have been
furnished with such documents and opinions as they may
reasonably require for the purpose of enabling them to
pass upon the issuance and sale of the Shares as
contemplated in this Agreement, the Pricing Agreement
and related proceedings, or in order to evidence the
accuracy of any of the representations or warranties,
or the fulfillment of any of the agreements or
conditions herein contained; and all proceedings taken
by the Company in connection with the issuance and sale
of the Shares as herein contemplated shall be
satisfactory in form and substance to the
Representatives and counsel for the Underwriters.
(h) At Closing Time, the Company shall have
furnished to the Representatives a letter from
Anthony P. Gammie, Donald J. D'Antuono and Richard D.
McDonough addressed to the Representatives, in which
each such person agrees not to offer, sell or contract
to sell, or otherwise dispose of, directly or
indirectly, or announce an offering of, any shares of
Common Stock beneficially owned by such person or any
securities convertible into, or exchangeable for,
shares of Common Stock for a period of 90 days
following the Closing Time without the prior written
consent of the Representatives, other than shares of
Common Stock disposed of as bona fide gifts.
(i) Subsequent to the time of the execution of
this Agreement, there shall not have been any decrease
in the rating of any of the Company's debt or equity
securities by any "nationally recognized statistical
rating organization" (as defined for purposes of
Rule 436(g) under the 1933 Act) or any notice given by
such organization of any intended or potential decrease
in any such rating or of a possible change in any such
rating that does not indicate the direction of the
possible change.
(j) In the event the Underwriters exercise their
option provided in Section 2(b) hereof to purchase all
or any portion of the Option Shares, the
representations and warranties of the Company contained
herein and the statements in any certificates furnished
by the Company hereunder shall be true and correct as
of each Date of Delivery, and the Underwriters shall
have received:
(1) A certificate, dated such Date of
Delivery, of the Company by a Vice President or
other officer and the principal financial or
principal accounting officer or treasurer, in
their capacities as such, confirming that the
certificate delivered at Closing Time pursuant to
Section 5(c) hereof remains true and correct as of
such Date of Delivery.
(2) The favorable opinion of Wendy C. Shiba,
Esq., in form and substance reasonably
satisfactory to counsel for the Underwriters,
dated such Date of Delivery, relating to the
Option Shares and otherwise to the same effect as
the opinions required by Section 5(b)(1) hereof.
(3) The favorable opinion of Cravath, Swaine
& Moore, counsel for the Underwriters, dated such
Date of Delivery, relating to the Option Shares
and otherwise to the same effect as the opinion
required by Section 5(b)(2) hereof.
(4) The opinion of John C. Hollister, Esq.,
counsel to the Depositary, dated such Date of
Delivery, to the same effect as the opinion
required by Section 5(b)(5) hereof.
(5) A letter from KPMG Peat Marwick, in form
and substance satisfactory to the Representatives
and dated such Date of Delivery, substantially the
same in scope and substance as the letter
furnished to the Representatives pursuant to
Section 5(e) hereof, except that the "specified
date" in the letter furnished pursuant to this
Section 5(j)(5) shall be a date not more than five
days prior to such Date of Delivery.
If any condition specified in this Section shall
not have been fulfilled when and as required to be
fulfilled, this Agreement may be terminated by the
Representatives by notice to the Company at any time at or
prior to Closing Time, and such termination shall be without
liability of any party to any other party except as provided
in Section 4, and provided further that Sections 6, 7 and 13
hereof shall survive such termination.
SECTION 6. Indemnification. (a) The Company
agrees to indemnify and hold harmless each Underwriter and
each person, if any, who controls any Underwriter within the
meaning of Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim,
damage and reasonable expense whatsoever, as incurred,
arising out of any untrue statement or alleged untrue
statement of a material fact contained in the
Registration Statement (or any amendment thereto)
including the information deemed to be part of the
Registration Statement pursuant to Rule 430A(b) of the
1933 Act Regulations, if applicable, or the omission or
alleged omission therefrom of a material fact required
to be stated therein or necessary to make the
statements therein not misleading or arising out of any
untrue statement or alleged untrue statement of a
material fact contained in the Prospectus (or any
amendment or supplement thereto) or the omission or
alleged omission therefrom of a material fact necessary
in order to make the statements therein, in the light
of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim,
damage and reasonable expense whatsoever, as incurred,
to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or
proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or
any such alleged untrue statement or omission, if such
settlement is effected with the written consent of the
Company; and
(iii) against any and all expense whatsoever, as
incurred (including, subject to Section 6(c) hereof,
the reasonable fees and disbursements of counsel chosen
by the Representatives, if applicable thereunder), that
is reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation
or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent
that any such expense is not paid under (i) or (ii)
above;
provided, however, that this indemnity agreement shall not
apply to any loss, liability, claim, damage or expense to
the extent arising out of any untrue statement or omission
or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to
the Company by any Underwriter through the Representatives
expressly for use in the Registration Statement (or any
amendment thereto) or the Prospectus (or any amendment or
supplement thereto); and provided further, that the
foregoing indemnification with respect to any preliminary
prospectus shall not inure to the benefit of the
Underwriters, or any person controlling the Underwriters,
with respect to losses, claims, liabilities or damages
asserted by any person who purchased Shares from the
Underwriters, if a copy of the Prospectus (as then amended
or supplemented if the Company shall have furnished any
amendments or supplements thereto) was not sent or given by
or on behalf of the Underwriters to such person, if required
by law so to have been delivered, at or prior to the written
confirmation of the sale of such Shares to such person, and
if the Prospectus (as so amended or supplemented) would have
cured the defect giving rise to such loss, claim, damage or
liability.
(b) Each Underwriter agrees, severally and not
jointly, to indemnify and hold harmless the Company, its
directors, each of its officers who signed the Registration
Statement, and each person, if any, who controls the Company
within the meaning of Section 15 of the 1933 Act, against
any and all loss, liability, claim, damage and reasonable
expense described in the indemnity contained in
subsection (a) of this Section, as incurred, but only with
respect to untrue statements or omissions, or alleged untrue
statements or omissions, made in the Registration Statement
(or any amendment thereto) or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Company
by such Underwriter through the Representatives expressly
for use in the Registration Statement (or any amendment
thereto) or the Prospectus (or any amendment or supplement
thereto). The Company acknowledges that the statements set
forth in the last paragraph of the cover page, the first
paragraph of page 2, and under the heading "Underwriting" in
the Registration Statement (or any amendment thereto) or the
Prospectus (or any amendment or supplement thereto)
constitute the only information furnished in writing by or
on behalf of the several Underwriters for use in the
Registration Statement (or any amendment thereto) or the
Prospectus (or any amendment or supplement thereto).
(c) Each indemnified party shall give notice as
promptly as reasonably practicable to each indemnifying
party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure so to notify
an indemnifying party shall not relieve such indemnifying
party from any liability which it may have otherwise than on
account of this indemnity agreement. An indemnifying party
may participate at its own expense in the defense of any
such action. If it so elects within a reasonable time after
receipt of such notice, an indemnifying party, jointly with
any other indemnifying parties receiving such notice, may
assume the defense of such action with counsel chosen by it
and approved by the indemnified parties defendant in such
action, which approval shall not be unreasonably withheld,
unless such indemnified parties object to such assumption on
the ground that there may be legal defenses available to
them which are different from or in addition to those
available to such indemnifying party. If an indemnifying
party assumes the defense of such action, the indemnifying
parties shall not be liable for any fees and expenses of
counsel for the indemnified parties incurred thereafter in
connection with such action. In no event shall the
indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate
from their own counsel for all indemnified parties in
connection with any one action or separate but similar or
related actions in the same jurisdiction arising out of the
same general allegations or circumstances.
SECTION 7. Contribution. In order to provide for
just and equitable contribution in circumstances in which
the indemnity agreement provided for in Section 6 is for any
reason held to be unenforceable by the indemnified parties
although applicable in accordance with its terms, the
Company and the Underwriters shall contribute to the
aggregate losses, liabilities, claims, damages and expenses
of the nature contemplated by said indemnity agreement
incurred by the Company and one or more of the Underwriters,
as incurred, in such proportions that the Underwriters are
responsible for that portion represented by the percentage
that the underwriting discount appearing on the cover page
of the Prospectus bears to the initial public offering price
appearing thereon and the Company is responsible for the
balance; provided, however, that no person guilty of
fraudulent misrepresentation (within the meaning of
Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section,
each person, if any, who controls a Underwriter within the
meaning of Section 15 of the 1933 Act shall have the same
rights to contribution as such Underwriter, and each
director of the Company, each officer of the Company who
signed the Registration Statement, and each person, if any,
who controls the Company within the meaning of Section 15 of
the 1933 Act shall have the same rights to contribution as
the Company.
SECTION 8. Representations, Warranties and
Agreements to Survive Delivery. All representations,
warranties and agreements contained in this Agreement and
the Pricing Agreement, or contained in certificates of
officers of the Company submitted pursuant hereto, shall
remain operative and in full force and effect, regardless of
any investigation made by or on behalf of any Underwriter or
controlling person, or by or on behalf of the Company, and
shall survive delivery of the Shares to the Underwriters.
SECTION 9. Termination of Agreement. (a) The
Representatives may terminate this Agreement, by notice to
the Company, at any time at or prior to Closing Time (i) if
there has been, since the date of this Agreement or since
the respective dates as of which information is given in the
Registration Statement, any material adverse change in the
condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise, whether or
not arising in the ordinary course of business, or (ii) if
there has occurred any material adverse change in the
financial markets in the United States or any outbreak or
escalation of hostilities or other national or international
calamity or crisis, the effect of which is such as to make
it, in the judgment of the Representatives, impracticable or
inadvisable to market the Shares or to enforce contracts for
the sale of the Shares, or (iii) if trading in the Common
Stock has been suspended by the Commission or the New York
Stock Exchange, or if trading generally on the New York
Stock Exchange has been suspended, or minimum or maximum
prices for trading have been fixed, or maximum ranges for
prices for securities have been required, by said Exchange
or by order of the Commission or any other governmental
authority, or (iv) if a banking moratorium has been declared
by either federal or New York State authorities.
(b) If this Agreement is terminated pursuant to
this Section, such termination shall be without liability of
any party to any other party except as provided in
Section 4, and provided further that Sections 6, 7 and 13
hereof shall survive such termination.
SECTION 10. Default by One or More of the
Underwriters. If one or more of the Underwriters shall fail
at Closing Time to purchase the Initial Shares which it or
they are obligated to purchase under this Agreement and the
Pricing Agreement (the "Defaulted Shares"), the
Representatives shall have the right, within 24 hours
thereafter, to make arrangements for one or more of the non-
defaulting Underwriters, or any other underwriters, to
purchase all, but not less than all, of the Defaulted Shares
in such amounts as may be agreed upon and upon the terms
herein set forth; if, however, the Representatives shall not
have completed such arrangements within such 24-hour period,
then:
(a) if the number of Defaulted Shares does not
exceed 10% of the Initial Shares, each of the non-
defaulting Underwriters shall be obligated, severally
and not jointly, to purchase the full amount thereof in
the proportions that their respective underwriting
obligations hereunder bear to the underwriting
obligations of all non-defaulting Underwriters, or
(b) if the number of Defaulted Shares exceeds 10%
of the Initial Shares, this Agreement shall terminate
without liability on the part of any nondefaulting
Underwriter or the Company.
No action taken pursuant to this Section shall
relieve any defaulting Underwriter from liability in respect
of its default.
In the event of any such default which does not
result in a termination of this Agreement, either the
Representatives or the Company shall have the right to
postpone Closing Time for a period not exceeding seven days
in order to effect any changes deemed necessary or advisable
in the Registration Statement or Prospectus or in any other
documents or arrangements.
SECTION 11. Notices. All notices and other
communications hereunder shall be in writing and shall be
deemed to have been duly given if mailed, personally
delivered or transmitted by any standard form of
telecommunication. Notices to the Underwriters shall be
directed to the Representatives in care of Merrill Lynch &
Co., North Tower, World Financial Center, New York, New York
10281-1201, Attention of Corporate Finance, 27th Floor;
notices to the Company shall be directed to it at 55 East
Camperdown Way, Post Office Box 1028, Greenville, South
Carolina 29602, Attention of Treasurer, with a copy to
Corporate Secretary.
SECTION 12. Parties. This Agreement and the
Pricing Agreement shall each inure to the benefit of and be
binding upon the Underwriters and the Company and their
respective successors. Nothing expressed or mentioned in
this Agreement or the Pricing Agreement is intended or shall
be construed to give any person, firm or corporation, other
than the Underwriters and the Company and their respective
successors and the controlling persons and officers and
directors referred to in Sections 6 and 7 and their
respective successors, heirs and legal representatives, any
legal or equitable right, remedy or claim under or in
respect of this Agreement or the Pricing Agreement or any
provision herein or therein contained. This Agreement and
the Pricing Agreement and all conditions and provisions
hereof and thereof are intended to be for the sole and
exclusive benefit of the Underwriters and the Company and
their respective successors, and said controlling persons
and officers and directors and their respective successors,
heirs and legal representatives, and for the benefit of no
other person, firm or corporation. No purchaser of Shares
from any Underwriter shall be deemed to be a successor by
reason merely of such purchase.
SECTION 13. Governing Law and Time. This
Agreement and the Pricing Agreement shall be governed by and
construed in accordance with the laws of the State of New
York applicable to agreements made and to be performed in
said State. Specified times of day refer to New York City
time.
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to
the Company a counterpart hereof, whereupon this instrument,
along with all counterparts, will become a binding agreement
between the Underwriters and the Company in accordance with
its terms.
Very truly yours,
BOWATER INCORPORATED,
By /s/ DAVID G. MAFFUCCI
----------------------------
Name: David G. Maffucci
Title: Vice President-
Treasurer
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
SALOMON BROTHERS INC
KIDDER, PEABODY & CO. INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
SMITH BARNEY SHEARSON INC.
By MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated,
By /s/ JAMES A. HISLOP
----------------------
Name: James A. Hislop
Title: Managing Director
For themselves and as Representatives of the other
Underwriters named in Schedule A hereto.
SCHEDULE A
Number of
Initial
Name of Underwriter Shares
Merrill Lynch, Pierce, Fenner & Smith
Incorporated .......................... 600,000
Salomon Brothers Inc .................... 600,000
Kidder, Peabody & Co. Incorporated ...... 600,000
Prudential Securities Incorporated ...... 600,000
Smith Barney Shearson Inc. .............. 600,000
Total............................... 3,000,000
EXHIBIT A
BOWATER INCORPORATED
(a Delaware Corporation)
3,000,000 Depositary Shares
Representing a One-Fourth
Interest in a Share of
8.40% Series C Cumulative Preferred Stock,
par value $1 per share
PRICING AGREEMENT
February 1, 1994
MERRILL LYNCH & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
SALOMON BROTHERS INC
KIDDER, PEABODY & CO. INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
SMITH BARNEY SHEARSON INC.
as Representatives of the several Underwriters
named in the within-mentioned Purchase Agreement
c/o Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281-1209
Dear Sirs:
Reference is made to the Purchase Agreement,
dated February 1, 1994 (the "Purchase Agreement"), relating
to the purchase by the several Underwriters named in
Schedule A thereto (the "Underwriters"), for whom Merrill
Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Salomon Brothers Inc, Kidder, Peabody & Co.
Incorporated, Prudential Securities Incorporated, and Smith
Barney Shearson Inc. are acting as representatives (the
"Representatives"), of the Depositary Shares (the "Shares"),
representing a one-fourth interest in the 8.40% Series C
Cumulative Preferred Stock, of Bowater Incorporated, a
Delaware corporation (the "Company").
Pursuant to Section 2 of the Purchase Agreement,
the Company agrees with each Underwriter as follows:
1. The initial public offering price per share
for the Shares, determined as provided in said
Section 2, shall be $25.00.
2. The purchase price per share for the Shares
to be paid by the several Underwriters shall be
$24.2125 being an amount equal to the initial public
offering price set forth above less $.7875 per share;
provided that the purchase price per share for any
Option Shares (as defined in the Purchase Agreement)
purchased upon exercise of the over-allotment option
described in Section 2(b) of the Purchase Agreement
shall be reduced by an amount per share equal to any
dividends per share declared by the Company and payable
on the Initial Shares (as defined in the Purchase
Agreement) but not payable on the Option Shares.
3. The dividend rate on the Series C Cumulative
Preferred Stock will be 8.40%.
4. Payment of the purchase price for, and
delivery of certificates for, the Shares shall be at
the office of Cravath, Swaine & Moore, New York, at
10:00 A.M. on the fifth business day after the
execution of this Pricing Agreement.
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to
the Company a counterpart hereof, whereupon this instrument,
along with all counterparts, will become a binding agreement
between the Underwriters and the Company in accordance with
its terms.
Very truly yours,
BOWATER INCORPORATED
By /s/ DAVID G. MAFFUCCI
---------------------------
Name: David G. Maffucci
Title: Vice President-
Treasurer
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
SALOMON BROTHERS INC
KIDDER, PEABODY & CO. INCORPORATED
PRUDENTIAL SECURITIES INCORPORATED
SMITH BARNEY SHEARSON INC.
By MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By /s/ JAMES A. HISLOP
----------------------------
Name: James A. Hislop
Title: Managing Director
For themselves and as Representatives of the other
Underwriters named in Schedule A to the Purchase Agreement.
BOWATER INCORPORATED
CERTIFICATE OF DESIGNATIONS
OF THE
7% PRIDES, SERIES B CONVERTIBLE PREFERRED STOCK
________________________
Pursuant to Section 151 of the General
Corporation Law of the State of Delaware
________________________
BOWATER INCORPORATED, a corporation organized and
existing under the laws of the State of Delaware (the
"Corporation"), hereby certifies that the following
resolution was duly adopted by the Board of Directors of the
Corporation (the "Board of Directors") at a meeting duly
called and held on January 26, 1994 at which meeting a
quorum of the members of the Board of Directors was present
and acting throughout, and was duly amended and supplemented
by the action of the Pricing Committee (the "Pricing
Committee") of the Board of Directors, acting pursuant to
authority delegated to the Pricing Committee by the Board of
Directors on October 21, 1993, at a meeting duly called and
held on February 1, 1994, at which meeting a quorum of the
members of the Pricing Committee was present and acting
throughout.
RESOLVED that, pursuant to authority expressly
vested in the Board of Directors by the provisions of the
Restated Certificate of Incorporation of the Corporation
(the "Certificate"), the Board of Directors hereby provides
for the issuance of a series of serial preferred stock of
the Corporation, par value $1.00 per share (all series of
serial preferred stock of the Corporation being hereinafter
referred to collectively as the "Preferred Stock"), to
consist of 1,223,404 shares, and hereby fixes the powers,
designation, preferences and relative, participating,
optional and other rights of such series of Preferred Stock,
and the qualifications, limitations and restrictions
thereof, as follows:
1. Designation; Ranking. (a) The designation of
the series of Preferred Stock created by this resolution
shall be "7% PRIDES, Series B Convertible Preferred Stock"
(hereinafter called the "PRIDES"), and the number of shares
constituting the PRIDES is 1,223,404.
(b) Any shares of the PRIDES that at any time
have been redeemed, purchased, acquired upon conversion or
otherwise acquired by the Corporation shall, after such
redemption, purchase, conversion or other acquisition,
resume the status of authorized and unissued shares of
Preferred Stock without designation as to series until such
shares are once more designated as part of a particular
series by the Board of Directors.
(c) The shares of PRIDES will rank on a parity,
both as to payment of dividends and distribution of assets
upon liquidation, with the Corporation's LIBOR Preferred
Stock, Series A, and its 8.40% Series C Cumulative Preferred
Stock, as well as any Preferred Stock issued in the future
by the Corporation that by its terms ranks pari passu with
the shares of PRIDES.
2. Dividends. The holders of record of the
shares of PRIDES shall be entitled to receive, when, as and
if declared by the Board of Directors out of funds legally
available therefor, cash dividends ("Preferred Dividends")
from the date of the initial issuance of the shares of
PRIDES at the rate of 7 percent of the $94.00 liquidation
preference per annum, payable quarterly in arrears on the
first day of January, April, July, and October or, if any
such date is not a business day (as defined in paragraph 6
hereto), the Preferred Dividend due on such date shall be
payable on the next succeeding business day (each such
payment date, and any redemption date pursuant to the
proviso set forth in this sentence, being a "Dividend
Payment Date"); provided, however; that, with respect to any
dividend period during which a redemption of any shares of
PRIDES occurs, the Corporation may, at its option, declare
accrued Preferred Dividends to, and pay such dividends on,
the date fixed for redemption, in which case such dividends
would be payable in cash to the holders of shares of PRIDES
as of the record date for such dividend payment and would
not be included in the calculation of the related Call Price
(as defined herein). The first dividend period will be from
the date of initial issuance of the shares of PRIDES to but
excluding April 1, 1994 and will be payable on April 1,
1994. Preferred Dividends shall cease to accrue on shares
of PRIDES on the Mandatory Conversion Date (as defined
herein) or on the date of their earlier conversion or
redemption. Preferred Dividends will be payable to holders
of record of shares of PRIDES as they appear on the stock
register of the Corporation on such record dates, not less
than 15 nor more than 60 days preceding the payment date
thereof, as shall be fixed by the Board of Directors.
Preferred Dividends payable on shares of PRIDES for any
period less than a full quarterly dividend period (or, in
the case of the first Preferred Dividend, from the date of
initial issuance of the shares of PRIDES to the first
Dividend Payment Date) will be computed on the basis of a
360-day year of twelve 30-day months and the actual number
of days elapsed in any period less than one month.
Preferred Dividends shall accrue on a daily basis (computed
as set forth in the immediately preceding sentence) whether
or not there are funds of the Corporation legally available
for the payment of such dividends and whether or not such
Preferred Dividends are declared. Accrued but unpaid
Preferred Dividends shall cumulate as of the Dividend
Payment Date on which they first become payable, but no
interest shall accrue on accumulated but unpaid Preferred
Dividends.
As long as shares of PRIDES are outstanding, no
dividends (other than dividends payable in shares of, or
warrants, rights or options exercisable for or convertible
into shares of, any capital stock, including without
limitation the Common Stock (as defined herein), of the
Corporation ranking junior to the shares of PRIDES as to the
payment of dividends and the distribution of assets upon
liquidation (collectively, "Junior Stock") and cash in lieu
of fractional shares in connection with any such dividend)
will be paid or declared in cash or otherwise, nor will any
other distribution be made (other than a distribution
payable in Junior Stock and cash in lieu of fractional
shares in connection with any such distribution), on any
Junior Stock unless (i) full dividends on Preferred Stock
that does not constitute Junior Stock ("Parity Preferred
Stock") have been paid, or declared and set aside for
payment, for all dividend periods terminating on or prior to
the date of such Junior Stock dividend or distribution
payment to the extent such dividends are cumulative;
(ii) dividends in full for the current quarterly dividend
period have been paid, or declared and set aside for
payment, on all Parity Preferred Stock to the extent such
dividends are cumulative; (iii) the Corporation has paid or
set aside all amounts, if any, then or theretofore required
to be paid or set aside for all purchase, retirement, and
sinking funds, if any, for any Parity Preferred Stock; and
(iv) the Corporation is not in default on any of its
obligations to redeem any Parity Preferred Stock.
As long as any shares of PRIDES are outstanding,
no shares of Junior Stock may be purchased, redeemed, or
otherwise acquired by the Corporation or any of its
subsidiaries (except in connection with a reclassification
or exchange of any Junior Stock through the issuance of
other Junior Stock (and cash in lieu of fractional shares in
connection therewith) or the purchase, redemption, or other
acquisition of any Junior Stock with any Junior Stock (and
cash in lieu of fractional shares in connection therewith))
nor may any funds be set aside or made available for any
sinking fund for the purchase, redemption or acquisition of
any Junior Stock unless: (i) full dividends on Parity
Preferred Stock have been paid, or declared and set aside
for payment, for all dividend periods terminating on or
prior to the date of such purchase, redemption, acquisition,
setting aside or making available to the extent such
dividends are cumulative; (ii) dividends in full for the
current quarterly dividend period have been paid, or
declared and set aside for payment, on all Parity Preferred
Stock to the extent such dividends are cumulative; (iii) the
Corporation has paid or set aside all amounts, if any, then
or theretofore required to be paid or set aside for all
purchase, retirement, and sinking funds, if any, for any
Parity Preferred Stock; and (iv) the Corporation is not in
default on any of its obligations to redeem any Parity
Preferred Stock.
As long as any shares of PRIDES are outstanding,
dividends or other distributions may not be declared or paid
on any Parity Preferred Stock (other than dividends or other
distributions payable in Junior Stock and cash in lieu of
fractional shares in connection therewith) and the
Corporation may not purchase, redeem or otherwise acquire
any Parity Preferred Stock (except with any Junior Stock and
cash in lieu of fractional shares in connection therewith
and except with the right, subject to clause (b) of this
paragraph and any similar requirement of any other
Certificate of Designations for Preferred Stock, to receive
accrued and unpaid dividends), unless either: (a)(i) full
dividends on Parity Preferred Stock have been paid, or
declared and set aside for payment, for all dividend periods
terminating on or prior to the date of such Parity Preferred
Stock dividend, distribution, redemption, purchase or
acquisition payment to the extent such dividends are
cumulative; (ii) dividends in full for the current quarterly
dividend period have been paid, or declared and set aside
for payment, on all Parity Preferred Stock to the extent
such dividends are cumulative; (iii) the Corporation has
paid or set aside all amounts, if any, then or theretofore
required to be paid or set aside for all purchase,
retirement, and sinking funds, if any, for any Parity
Preferred Stock; and (iv) the Corporation is not in default
on any of its obligations to redeem any Parity Preferred
Stock; or (b) with respect to the declaration and payment of
dividends only, any such dividends are declared and paid pro
rata so that the amounts of any dividends declared and paid
per share of PRIDES and each other share of Parity Preferred
Stock will in all cases bear to each other the same ratio
that accrued and unpaid dividends (including any
accumulation with respect to unpaid dividends for prior
dividend periods, if such dividends are cumulative) per
share of PRIDES and such other share of Parity Preferred
Stock bear to each other.
3. Conversion or Redemption. (a) Unless
previously either called for redemption in accordance with
the provisions of paragraph 3(b) or converted at the option
of the holder in accordance with the provisions of
paragraph 3(c), on January 1, 1998 (the "Mandatory
Conversion Date") each outstanding share of PRIDES will
convert mandatorily (the "Mandatory Conversion") into
(i) shares of authorized common stock, $1.00 par value, of
the Corporation (the "Common Stock") at the Common
Equivalent Rate (as defined herein) in effect on the
Mandatory Conversion Date and (ii) the right to receive an
amount in cash equal to all accrued and unpaid Preferred
Dividends on such share of PRIDES (other than previously
declared dividends payable to a holder of record as of a
prior date) to the Mandatory Conversion Date, whether or not
declared, out of funds legally available for the payment of
Preferred Dividends, subject to the requirement set forth in
clause (b) in the last paragraph of paragraph 2 above and
any similar requirement of any other Certificate of
Designations for Preferred Stock, subject to the right of
the Corporation to redeem the shares of PRIDES on or after
January 1, 1997 (the "Initial Redemption Date") and prior to
the Mandatory Conversion Date and subject to the conversion
of the shares of PRIDES at the option of the holder at any
time prior to the Mandatory Conversion Date. The Common
Equivalent Rate is initially four shares of Common Stock for
each share of PRIDES and is subject to adjustment as set
forth in paragraphs 3(d) and 3(e) below. Preferred
Dividends on the shares of PRIDES shall cease to accrue and
such shares of PRIDES shall cease to be outstanding on the
Mandatory Conversion Date. The Corporation shall make such
arrangements as it deems appropriate for the issuance of
certificates representing shares of Common Stock and for the
payment of cash in respect of such accrued and unpaid
dividends, if any, or cash in lieu of fractional shares, if
any, without interest, in exchange for and contingent upon
surrender of certificates representing the shares of PRIDES,
and the Corporation may defer the payment of dividends on
such shares of Common Stock and the voting thereof until,
and make such payment and voting contingent upon, the
surrender of certificates representing the shares of PRIDES,
provided that the Corporation shall give the holders of the
shares of PRIDES such notice of any such actions as the
Corporation deems appropriate and upon such surrender such
holders shall be entitled to receive such dividends declared
and paid, if any, without interest, on such shares of Common
Stock subsequent to the Mandatory Conversion Date.
(b) (i) Shares of PRIDES are not redeemable by
the Corporation prior to the Initial Redemption Date. At
any time and from time to time on or after that date until
immediately prior to the Mandatory Conversion Date, the
Corporation will have the right to redeem, in whole or in
part, the outstanding shares of PRIDES (subject to the
notice provisions set forth in paragraph 3(b)(iii) and to
the Certificate). Upon any such redemption the Corporation
will deliver to the holder thereof, in exchange for each
share of PRIDES subject to redemption, the greater of:
(A) the number of shares of Common Stock equal to
the Call Price (as defined herein) in effect on the
redemption date divided by the Current Market Price (as
defined herein) of the Common Stock, such Current
Market Price being determined as of the second Trading
Day (as defined herein) immediately preceding the
Notice Date (as defined herein); or
(B) shares of Common Stock equal to the then
applicable Optional Conversion Rate (as defined
herein).
Dividends will cease to accrue on the shares of PRIDES on
the date fixed for their redemption (unless the Corporation
defaults on the payment of the redemption price). The "Call
Price" of each share of PRIDES is the sum of (x) $95.644 on
and after the Initial Redemption Date to and including
March 31, 1997, or $95.234 on and after April 1, 1997, to
and including June 30, 1997, or $94.823 on and after July 1,
1997, to and including September 30, 1997, or $94.411 on and
after October 1, 1997, to and including November 30, 1997,
or $94.00 on and after December 1, 1997, to and including
December 31, 1997, and (y) all accrued and unpaid dividends
thereon to but not including the date fixed for redemption
(other than previously declared dividends payable to a
holder of record as of a prior date). If fewer than all of
the outstanding shares of PRIDES are to be called for
redemption, shares of PRIDES to be called for redemption
will be selected by the Corporation from outstanding shares
of PRIDES not previously called by lot or pro rata (as
nearly as may be) or by any other method determined by the
Board of Directors in its sole discretion to be equitable.
(ii) The term "Current Market Price" per share of
the Common Stock on any date of determination means the
lesser of (x) the average of the Closing Prices (as defined
herein) of the Common Stock for the 15 consecutive Trading
Days ending on and including such date of determination, or
(y) the Closing Price of the Common Stock for such date of
determination; provided, however, that, with respect to any
redemption of shares of PRIDES, if any event that results in
an adjustment of the Common Equivalent Rate occurs during
the period beginning on the first day of such 15-day period
and ending on the applicable redemption date, the Current
Market Price as determined pursuant to the foregoing will be
appropriately adjusted, in the sole determination of the
Board of Directors of the Corporation whose determination
shall be conclusive, to reflect the occurrence of such
event.
(iii) The Corporation will provide notice of any
call for redemption of shares of PRIDES to holders of record
of the shares of PRIDES to be called for redemption not less
than 15 nor more than 60 days prior to the date fixed for
redemption. Any such notice will be provided by mail, sent
to the holders of record of the shares of PRIDES to be
called for redemption at such holder's address as it appears
on the stock register of the Corporation, first class
postage prepaid; provided, however, that failure to give
such notice or any defect therein shall not affect the
validity of the proceeding for the redemption of any shares
of PRIDES to be redeemed except as to the holder to whom the
Corporation has failed to give said notice or whose notice
was defective. On and after the redemption date, all rights
of the holders of the shares of PRIDES called for redemption
shall terminate except the right to receive the redemption
price (unless the Corporation defaults on the payment of the
redemption price). A public announcement of any call for
redemption will be made by the Corporation prior to, or at
the time of, the mailing of such notice of redemption. The
term "Notice Date" with respect to any notice given by the
Corporation in connection with a redemption of shares of
PRIDES means the date on which first occurs either the
public announcement of such call for redemption or the
commencement of mailing of the notice to the holders of
shares of PRIDES to be called for redemption, in each case
pursuant to this subparagraph (iii).
Each such notice shall state, as appropriate, the
following and may contain such other information as the
Corporation deems advisable:
(A) the redemption date;
(B) that all outstanding shares of PRIDES are to
be redeemed or, in the case of a redemption of fewer
than all outstanding shares of PRIDES, the number of
such shares held by such holder to be redeemed;
(C) the Call Price, the number of shares of Common
Stock deliverable upon redemption of each share of
PRIDES to be redeemed, and the Current Market Price
used to calculate such number of shares of Common
Stock;
(D) the place or places where certificates for
such shares of PRIDES are to be surrendered for
redemption; and
(E) that dividends on the shares of PRIDES to be
redeemed shall cease to accrue on and after such
redemption date (except as otherwise provided herein).
(iv) The Corporation's obligation to deliver
shares of Common Stock and provide funds upon redemption in
accordance with this paragraph 3(b) and paragraph 4 shall be
deemed fulfilled if, on or before a redemption date, the
Corporation shall deposit, with a bank or trust company, or
an affiliate of a bank or trust company, having an office or
agency in New York, New York, and having a capital and
surplus of at least $50,000,000 according to its last
published statement of condition, or shall set aside or make
other reasonable provision for the issuance of, such number
of shares of Common Stock as are required to be delivered by
the Corporation pursuant to this paragraph 3(b) upon the
occurrence of the related redemption of PRIDES and such
amount of cash in lieu of the issuance of fractional share
amounts as is required by paragraph 4, in trust for the
account of the holders of such shares of PRIDES to be
redeemed (and so as to be and continue to be available
therefor), with irrevocable instructions and authority to
such bank or trust company, or affiliate thereof, to deliver
such shares and funds upon redemption of the shares of
PRIDES so called for redemption. Any interest accrued on
such funds shall be paid to the Corporation from time to
time. Any shares of Common Stock or funds so deposited and
unclaimed at the end of three years from such redemption
date shall be repaid and released to the Corporation, after
which, subject to applicable law, the holder or holders of
such shares of PRIDES so called for redemption shall look
only to the Corporation for delivery of shares of Common
Stock and the payment of any other funds due in connection
with the redemption of such shares of PRIDES.
(v) Each holder of shares of PRIDES called for
redemption must surrender the certificates evidencing such
shares (properly endorsed or assigned for transfer, if the
Board of Directors shall so require and the notice shall so
state) to the Corporation at the place designated in the
notice of such redemption and will thereupon be entitled to
receive certificates evidencing shares of Common Stock and
to receive any funds payable pursuant to this paragraph 3(b)
and paragraph 4, without interest, following such surrender
and on or following the date of such redemption. In case
fewer than all the shares represented by any such
surrendered certificate are called for redemption, a new
certificate shall be issued at the expense of the
Corporation representing the unredeemed shares. If such
notice of redemption shall have been given, and if on the
date fixed for redemption shares of Common Stock and funds
necessary for the redemption shall have been irrevocably
either (A) set aside by the Corporation separate and apart
from its other funds or assets in trust for the account of
the holders of the shares to be redeemed (and so as to be
and continue to be available therefor) or (B) deposited with
a bank or trust company or an affiliate thereof as provided
herein or the Corporation shall have made other reasonable
provision therefor, then notwithstanding that the
certificates evidencing any shares of PRIDES so called for
redemption shall not have been surrendered, the shares
represented thereby so called for redemption shall be deemed
no longer outstanding, Preferred Dividends with respect to
the shares so called for redemption shall cease to accrue on
the date fixed for redemption and all rights with respect to
the shares so called for redemption shall forthwith after
such date cease and terminate, except for the rights of the
holders to receive the shares of Common Stock and funds, if
any, payable pursuant to this paragraph 3(b) and
paragraph 4, without interest, upon surrender of their
certificates therefor and except that holders of shares of
PRIDES at the close of business on a record date (preceding
the redemption date) for any payment of Preferred Dividends
shall be entitled to receive the Preferred Dividend payable
on such shares on the corresponding Dividend Payment Date
notwithstanding the redemption of such shares following such
record date and prior to such Dividend Payment Date.
Holders of shares of PRIDES that are redeemed shall not be
entitled to receive dividends declared and paid on the
shares of Common Stock deliverable upon such redemption, and
such shares of Common Stock shall not be entitled to vote,
until such shares of Common Stock are issued upon the proper
surrender of the certificates representing such shares of
PRIDES, and upon such surrender such holders shall be
entitled to receive such dividends, without interest,
declared and paid on such shares of Common Stock subsequent
to such redemption date.
(c) Shares of PRIDES are convertible, in whole or
in part, at the option of the holders thereof ("Optional
Conversion"), at any time prior to the Mandatory Conversion
Date, unless previously redeemed, into shares of Common
Stock at a rate of 3.28 shares of Common Stock for each
share of PRIDES (the "Optional Conversion Rate"), subject to
adjustment as set forth below. The right of Optional
Conversion of shares of PRIDES called for redemption will
terminate immediately prior to the close of business on any
redemption date with respect to such shares.
Optional Conversion of shares of PRIDES may be
effected by delivering certificates evidencing such shares,
together with written notice of conversion and proper
assignment of such certificates to the Corporation or in
blank (and, if applicable, cash payment of an amount equal
to the dividend attributable to the current quarterly
dividend period payable on such shares), to the office of
any transfer agent for the shares of PRIDES or to any other
office or agency maintained by the Corporation for that
purpose and otherwise in accordance with Optional Conversion
procedures established by the Corporation. Each Optional
Conversion shall be deemed to have been effected immediately
prior to the close of business on the date on which the
foregoing requirements shall have been satisfied. The
Optional Conversion shall be at the Optional Conversion Rate
in effect at such time on such date.
Holders of shares of PRIDES at the close of
business on a record date for any payment of declared
Preferred Dividends will be entitled to receive the
Preferred Dividend payable on such shares of PRIDES on the
corresponding Dividend Payment Date notwithstanding the
Optional Conversion of such shares of PRIDES following such
record date and prior to such Dividend Payment Date.
However, shares of PRIDES surrendered for Optional
Conversion after the close of business on a record date for
any payment of declared Preferred Dividends and before the
opening of business on the next succeeding Dividend Payment
Date must be accompanied by payment in cash of an amount
equal to the Preferred Dividends attributable to the current
quarterly dividend period payable on such date (unless such
shares of PRIDES are subject to redemption on a redemption
date subsequent to the record date established for such
Dividend Payment Date and prior to or on such Dividend
Payment Date). Except as provided above, upon any Optional
Conversion of shares of PRIDES, the Corporation will make no
payment of or allowance for unpaid Preferred Dividends,
whether or not in arrears, on such shares of PRIDES as to
which Optional Conversion has been effected or previously
declared dividends or distributions on the shares of Common
Stock issued upon such Optional Conversion.
(d) The Common Equivalent Rate and the Optional
Conversion Rate are each subject to adjustment from time to
time as provided below in this paragraph (d).
(i) If the Corporation shall pay or make a
dividend or other distribution with respect to its
Common Stock in shares of Common Stock (including by
way of reclassification of any shares of its Common
Stock), the Common Equivalent Rate and the Optional
Conversion Rate 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 each be increased by
multiplying such Common Equivalent Rate and Optional
Conversion Rate by a fraction of which the numerator
shall be the sum of the number of shares of Common
Stock outstanding at the close of business on the date
fixed for such determination, excluding the effect of
such dividend or distribution, plus the total number of
shares of Common Stock constituting such dividend or
other distribution, and of which the denominator shall
be the number of shares of Common Stock outstanding at
the close of business on the date fixed for such
determination, excluding the effect of such dividend or
distribution, such increase to become effective at the
opening of business on the day following the date fixed
for such determination. For the purposes of this
clause (i), the number of shares of Common Stock at any
time outstanding shall not include shares held in the
treasury of the Corporation and the number of shares
constituting such dividend or other distribution shall
include shares represented by cash issued in lieu of
fractional shares of Common Stock.
(ii) In case outstanding shares of Common Stock
shall be subdivided or split into a greater number of
shares of Common Stock, the Common Equivalent Rate and
the Optional Conversion Rate in effect at the opening
of business on the day following the day upon which
such subdivision or split becomes effective shall each
be proportionately increased, and, conversely, in case
outstanding shares of Common Stock shall be combined
into a lesser number of shares of Common Stock, the
Common Equivalent Rate and the Optional Conversion Rate
in effect at the opening of business on the day
following the day upon which such combination becomes
effective shall each be proportionately reduced, such
increases or reductions, as the case may be, to become
effective at the opening of business on the day
following the day upon which such subdivision or split
or combination becomes effective.
(iii) If the Corporation shall, after the date
hereof, issue rights or warrants to all holders of its
Common Stock entitling them (for a period not exceeding
45 days from the date of such issuance) to subscribe
for or purchase shares of Common Stock at a price per
share less than the Current Market Price of the Common
Stock (determined pursuant to paragraph 3(b)(ii)) on
the record date for the determination of stockholders
entitled to receive such rights or warrants, then in
each case the Common Equivalent Rate and the Optional
Conversion Rate shall each be adjusted by multiplying
the Common Equivalent Rate and the Optional Conversion
Rate in effect on such record date by a fraction of
which the numerator shall be the number of shares of
Common Stock outstanding at the close of business on
the record date for issuance of such rights or
warrants, excluding the effect of such issuance, plus
the number of additional shares of Common Stock offered
for subscription or purchase pursuant to such rights or
warrants, and of which the denominator shall be the
number of shares of Common Stock outstanding at the
close of business on the record date for issuance of
such rights or warrants, excluding the effect of such
issuance, plus the number of shares of Common Stock
which the aggregate offering price of the total number
of shares of Common Stock so offered for subscription
or purchase pursuant to such rights or warrants would
purchase at such Current Market Price (determined by
multiplying such total number of offered shares by the
exercise price of such rights or warrants and dividing
the product so obtained by such Current Market Price).
Shares of Common Stock held by the Corporation or by
another company of which a majority of the shares
entitled to vote in the election of directors are held,
directly or indirectly, by the Corporation shall not be
deemed to be outstanding for purposes of such
computation. Such adjustment shall become effective at
the opening of business on the business day next
following the record date for the determination of
stockholders entitled to receive such rights or
warrants. To the extent that shares of Common Stock
are not delivered by reason of the expiration of such
rights or warrants, the Common Equivalent Rate and the
Optional Conversion Rate shall each be readjusted to
the Common Equivalent Rate and the Optional Conversion
Rate which would then be in effect had the adjustments
made by reason of the issuance of such rights or
warrants been made upon the basis of the issuance of
rights or warrants in respect of only the number of
shares of Common Stock actually delivered.
(iv) If the Corporation shall pay a dividend or
make a distribution to all holders of its Common Stock
consisting of evidences of its indebtedness, cash or
other assets (including shares of capital stock of the
Corporation other than Common Stock but excluding any
cash dividends or distributions, other than
Extraordinary Cash Distributions (as defined herein),
and dividends referred to in clause (i) above), or
shall issue to all holders of its Common Stock rights
or warrants to subscribe for or purchase any of its
securities (other than those referred to in
clause (iii) above), then in each such case the Common
Equivalent Rate and the Optional Conversion Rate shall
each be adjusted by multiplying the Common Equivalent
and the Optional Conversion Rate in effect on the
record date for such dividend or distribution or for
the determination of stockholders entitled to receive
such rights or warrants, as the case may be, by a
fraction of which the numerator shall be the Current
Market Price per share of the Common Stock (determined
pursuant to paragraph 3(b)(ii) on such record date),
and of which the denominator shall be such Current
Market Price per share of Common Stock less either (i)
the fair market value (as determined by the Board of
Directors, whose determination shall be conclusive) on
such record date of the portion of the assets or
evidences of indebtedness so distributed, or of such
rights or warrants, applicable to one share of Common
Stock or (ii), if applicable, the amount of the
Extraordinary Cash Distribution applicable to one share
of Common Stock. Such adjustment shall become
effective at the opening of business on the business
day next following the record date for such dividend or
distribution or for the determination of holders
entitled to receive such rights or warrants, as the
case may be. "Extraordinary Cash Distribution" means
the portion of any cash dividend or cash distribution
on the Common Stock that, when added to all other cash
dividends and cash distributions on the Common Stock
made during the immediately preceding 12-month period
(other than cash dividends and cash distributions for
which a prior adjustment to the Common Equivalent Rate
and Optional Conversion Rate was previously made)
exceeds, on a per share of Common Stock basis, 10% of
the average daily Closing Price of the Common Stock
over such 12-month period.
(v) Anything in this paragraph 3 notwithstanding,
the Corporation will be entitled (but shall not be
required) to make such upward adjustments in the Common
Equivalent Rate and the Optional Conversion Rate or the
Call Price in addition to those set forth by this
paragraph 3, as the Corporation, in its sole
discretion, shall determine to be advisable, in order
that any stock dividend, subdivision of stock,
distribution of rights to purchase stock or securities,
or distribution of securities convertible into or
exchangeable for stock (or any transaction that could
be treated as any of the foregoing transactions
pursuant to Section 305 of the Internal Revenue Code of
1986, as amended, or any successor provision) hereafter
made by the Corporation to its stockholders will not be
taxable in whole or in part.
(vi) All adjustments to the Common Equivalent Rate
and the Optional Conversion Rate will be calculated to
the nearest 1/100th of a share of Common Stock. No
adjustment in the Common Equivalent Rate or the
Optional Conversion Rate will be required unless such
adjustment would require an increase or decrease of at
least one percent in the Common Equivalent Rate;
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. All adjustments to the Common
Equivalent Rate and Optional Conversion Rate shall be
made successively.
(vii) Prior to taking any action that could result
in adjustment affecting the Common Equivalent Rate or
the Optional Conversion Rate such that the conversion
price (for purposes of this subparagraph, an amount
equal to the Call Price divided by the Common
Equivalent Rate or the Optional Conversion Rate,
respectively, as in effect from time to time) would be
below the then par value of the Common Stock, the
Corporation will take any corporate action which may,
in the opinion of its Board of Directors, be necessary
in order that the Corporation may validly and legally
issue fully paid and nonassessable shares of Common
Stock at the Common Equivalent Rate or the Optional
Conversion Rate as so adjusted.
(viii) Before redeeming any shares of PRIDES, the
Corporation will take any corporate action that may, in
the opinion of its counsel, be necessary in order that
the Corporation may validly and legally issue fully
paid and nonassessable shares of Common Stock upon such
redemption.
(e) In case of any consolidation or merger to
which the Corporation is a party (other than a merger or
consolidation in which the Corporation is the surviving or
continuing corporation and in which each share of Common
Stock outstanding immediately prior to the merger or
consolidation remains unchanged in all material respects),
or in case of any sale or transfer to another corporation of
the property of the Corporation as an entirety or
substantially as an entirety, or in the case of any
statutory exchange of securities with another corporation
(other than in connection with a merger or acquisition),
each share of PRIDES shall, after consummation of such
transaction, be subject to (i) conversion at the option of
the holder into the kind and amount of securities, cash or
other property receivable upon consummation of such
transaction by a holder of the number of shares of Common
Stock into which such share of PRIDES might have been
converted immediately prior to consummation of such
transaction, (ii) conversion on the Mandatory Conversion
Date into the kind and amount of securities, cash or other
property receivable upon consummation of such transaction by
a holder of the number of shares of Common Stock into which
such share of PRIDES would have been converted if the
conversion on the Mandatory Conversion Date had occurred
immediately prior to the date of consummation of such
transaction, plus the right, subject to the requirement set
forth in clause (b) in the last paragraph of paragraph 2
above and any similar requirement of any other Certificate
of Designations for Preferred Stock, to receive cash in an
amount equal to all accrued and unpaid dividends on such
share of PRIDES (other than previously declared dividends
payable to a holder of record as of a prior date), and
(iii) redemption on any redemption date in exchange for the
kind and amount of securities, cash or other property
receivable upon consummation of such transaction by a holder
of the number of shares of Common Stock that would have been
issuable, using the Call Price in effect on such redemption
date, upon a redemption of such share of PRIDES immediately
prior to consummation of such transaction, assuming that, if
the Notice Date for such redemption is not prior to such
transaction, the Notice Date had been the date of such
transaction; and assuming in each case that such holder of
shares of Common Stock failed to exercise rights of
election, if any, as to the kind or amount of securities,
cash or other property receivable upon consummation of such
transaction (provided that, if the kind or amount of
securities, cash or other property receivable upon
consummation of such transaction is not the same for each
non-electing share, then the kind and amount of securities,
cash or other property receivable upon consummation of such
transaction for each non-electing share shall be deemed to
be the kind and amount so receivable per share by a
plurality of the non-electing shares). The kind and amount
of securities into or for which the shares of the PRIDES
shall be convertible or redeemable after consummation of
such transaction shall be subject to adjustment as described
in paragraph 3(d) following the date of consummation of such
transaction. The Corporation may not become a party to any
such transaction unless the terms thereof are consistent
with the foregoing.
(f) Whenever the Common Equivalent Rate and
Optional Conversion Rate are adjusted as provided in
paragraph 3(d), the Corporation shall:
(i) forthwith compute the adjusted Common
Equivalent Rate and Optional Conversion Rate in
accordance with this paragraph 3 and prepare a
certificate signed by the Chief Financial Officer, any
Vice President, the Treasurer or the Controller of the
Corporation setting forth the adjusted Common
Equivalent Rate and Optional Conversion Rate, the
method of calculation thereof in reasonable detail and
the facts requiring such adjustment and upon which such
adjustment is based, which certificate shall be
conclusive, final and binding evidence of the
correctness of the adjustment, and shall file such
certificate forthwith with the transfer agent or agents
for the shares of PRIDES and the Common Stock;
(ii) make a prompt public announcement stating that
the Common Equivalent Rate and Optional Conversion Rate
have been adjusted and setting forth the adjusted
Common Equivalent Rate and Optional Conversion Rate;
and
(iii) mail a notice stating that the Common
Equivalent Rate and Optional Conversion Rate have been
adjusted, the facts requiring such adjustment and upon
which such adjustment is based and setting forth the
adjusted Common Equivalent Rate and Optional Conversion
Rate, to the holders of record of the outstanding
shares of the PRIDES no later than 45 days after the
end of the Corporation's fiscal quarter period during
which the facts requiring such adjustment occurred.
(g) In case, at any time while any of the shares
of PRIDES are outstanding,
(i) the Corporation shall declare a dividend (or
any other distribution) on the Common Stock, excluding
any cash dividends other than Extraordinary Cash
Distributions, or
(ii) the Corporation shall authorize the issuance
to all holders of the Common Stock of rights or
warrants to subscribe for or purchase shares of the
Common Stock or of any other subscription rights or
warrants, or
(iii) of any reclassification of the Common Stock
(other than a subdivision, split or combination
thereof) or of any consolidation or merger to which the
Corporation is a party and for which approval of any
stockholders of the Corporation is required (except for
a merger of the Corporation into one of its
subsidiaries solely for the purpose of changing the
corporate domicile of the Corporation to another state
of the United States and in connection with which there
is no substantive change in the rights or privileges of
any securities of the Corporation other than changes
resulting from differences in the corporate statutes of
the state the Corporation was then domiciled in and the
new state of domicile), or of the sale or transfer of
all or substantially all of the assets of the
Corporation (except to one or more wholly-owned
subsidiaries),
then the Corporation shall cause to be filed at each office
or agency maintained for the purpose of conversion of the
shares of PRIDES, and shall cause to be mailed to the
holders of shares of PRIDES at their last addresses as they
shall appear on the stock register, at least 10 business
days before the date hereinafter specified in clause (A) or
(B) below (or the earlier of the dates hereinafter
specified, in the event that more than one date is
specified), a notice stating (A) the date on which a record
is to be taken for the purpose of such dividend,
distribution, or issuance of rights or warrants, or, if a
record is not to be taken, the date as of which the holders
of Common Stock of record to be entitled to such dividend,
distribution, or issuance of rights or warrants are to be
determined, or (B) the date on which any such
reclassification, consolidation, merger, sale or transfer is
expected to become effective, and the date as of which it is
expected that holders of Common Stock of record shall be
entitled to exchange their Common Stock for securities or
other property (including cash), if any, deliverable upon
such reclassification, consolidation, merger, sale or
transfer. The failure to give or receive the notice
required by this paragraph (g) or any defect therein shall
not affect the legality or validity of any such dividend,
distribution, issuance of any right or warrant or other
action.
4. No Fractional Shares. No fractional shares of
Common Stock shall be issued upon the redemption or
conversion of any shares of the PRIDES. In lieu of any
fractional share otherwise issuable in respect of the
aggregate number of shares of the PRIDES of any holder that
are redeemed or converted on any redemption date or upon
Mandatory Conversion or any Optional Conversion, such holder
shall be entitled to receive an amount in cash (computed to
the nearest cent) equal to the same fraction of the
(i) Current Market Price of the Common Stock, determined as
of the second Trading Date immediately preceding the Notice
Date, in the case of redemption, or (ii) Closing Price of
the Common Stock determined (A) as of the fifth Trading Day
immediately preceding the Mandatory Conversion Date, in the
case of Mandatory Conversion or (B) as of the second Trading
Day immediately preceding the effective date of conversion,
in the case of an Optional Conversion by a holder. If more
than one share of PRIDES shall be surrendered for conversion
or redemption at one time by or for the same holder, the
number of full shares of Common Stock issuable upon
conversion or redemption thereof shall be computed on the
basis of the aggregate number of shares of the PRIDES so
converted or redeemed.
5. Reservation of Common Stock. The Corporation
shall at all times reserve and keep available out of its
authorized and unissued Common Stock, solely for issuance
upon the conversion or redemption of shares of PRIDES as
herein provided, free from any preemptive rights, such
maximum number of shares of Common Stock as shall from time
to time be issuable upon the Mandatory Conversion, Optional
Conversion or redemption of all the shares of PRIDES then
outstanding.
6. Definitions. As used in this Certificate of
Designations:
(i) the term "business day" shall mean any day
other than a Saturday, a Sunday or a day on which
commercial banking institutions in the City of
New York, New York, or Atlanta, Georgia, are authorized
or obligated by law or executive order to close;
(ii) the term "Closing Price", on any day, shall
mean the closing sale price regular way of the Common
Stock on such day or, in case no such sale takes place
on such day, the average of the reported closing bid
and asked prices regular way of the Common Stock on
such day, in each case on the New York Stock Exchange
or, if the Common Stock is not listed or admitted to
trading on such Exchange, on the principal national
securities exchange on which the Common Stock is listed
or admitted to trading, or, if not listed or admitted
to trading on any national securities exchange, the
average of the closing bid and asked prices of the
Common Stock on the over-the-counter market on the day
in question as reported by the National Association of
Securities Dealers, Inc. Automated Quotation System (or
any successor to such system), or a similarly generally
accepted reporting service, or if not so available in
such manner, as furnished by any New York Stock
Exchange member firm selected from time to time by the
Board of Directors for that purpose;
(iii) the term "record date" shall be such date as
is from time to time fixed by the Board of Directors
with respect to the receipt of dividends, the receipt
of a redemption price upon redemption or the taking of
any action or exercise of any voting rights permitted
hereby; and
(iv) the term "Trading Day" shall mean a date on
which the New York Stock Exchange (or any successor to
such Exchange), or, if the Common Stock is not listed
or admitted to trading on such exchange, the date on
which such exchange or market on which the Common Stock
is listed or traded, is open for the transaction of
business.
7. Payment of Taxes. The Corporation will pay
any and all documentary, stamp or similar issue or transfer
taxes payable in respect of the issue or delivery of shares
of Common Stock on the redemption or conversion of shares of
PRIDES pursuant to paragraph 3; provided, however, that the
Corporation shall not be required to pay any tax which may
be payable in respect of any registration or transfer
involved in the issue or delivery of shares of Common Stock
in a name other than that of the registered holder of shares
of PRIDES redeemed or converted or to be redeemed or
converted, and no such issue or delivery shall be made
unless and until the person requesting such issue or
delivery has paid to the Corporation the amount of any such
tax or has established, to the satisfaction of the
Corporation, that such tax has been paid.
8. Liquidation Rights. In the event of any
voluntary or involuntary liquidation, dissolution or winding
up of the Corporation, and subject to the rights of the
holders of any other series of Preferred Stock, the holders
of outstanding shares of PRIDES are entitled to receive the
sum of $94.00 per share, plus an amount equal to any accrued
and unpaid dividends thereon, out of the assets of the
Company available for distribution to stockholders, before
any distribution of assets is made to holders of Junior
Stock upon liquidation, dissolution, or winding up. If upon
any voluntary or involuntary liquidation, dissolution, or
winding up of the Corporation, the assets of the Corporation
are insufficient to permit the payment of the full
preferential amounts payable with respect to shares of
PRIDES and all other series of Parity Preferred Stock, the
holders of shares of PRIDES and of all other series of
Parity Preferred Stock will share ratably in any
distribution of assets of the Corporation in proportion to
the full respective preferential amounts to which they are
entitled. After payment of the full amount of the
liquidating distribution to which they are entitled, the
holders of shares of PRIDES will not be entitled to any
further participation in any distribution of assets by the
Corporation. A consolidation or merger of the Corporation
with one or more corporations or a sale or transfer of
substantially all of the assets of the Corporation shall not
be deemed to be a liquidation, dissolution, or winding up of
the Corporation.
9. Voting Rights. The holders of shares of
PRIDES shall have the right with the holders of Common Stock
to vote in the election of Directors and upon each other
matter coming before any meeting of the holders of Common
Stock on the basis of 3-1/5 votes for each share of PRIDES
held. The holders of shares of PRIDES and the holders of
Common Stock will vote together as one class on such matters
except as provided by law or the Certificate.
In the event that dividends on the shares of
PRIDES or any other series of Preferred Stock shall be in
arrears and unpaid for six quarterly dividend periods, or if
any other series of Preferred Stock shall be entitled for
any other reason to exercise voting rights, separate from
the Common Stock, to elect any Directors of the Corporation
("Preferred Stock Directors"), the holders of the shares of
PRIDES (voting separately as a class with holders of all
other series of Preferred Stock upon which like voting
rights have been conferred and are exercisable), with each
share of PRIDES entitled to one vote on this and other
matters in which Preferred Stock votes as a group, will be
entitled to vote for the election of two Preferred Stock
Directors, such Directors to be in addition to the number of
Directors constituting the Board of Directors immediately
prior to the accrual of such right. Such right, when
vested, shall continue until all dividends in arrears on the
shares of PRIDES and such other series of Preferred Stock
shall have been paid in full and the right of any other
series of Preferred Stock to exercise voting rights,
separate from the Common Stock, to elect any Preferred Stock
Directors shall terminate or have terminated, and, when so
paid and such termination occurs or has occurred, such right
of the holders of the shares of PRIDES shall cease. Upon
any termination of the aforesaid voting right, subject to
the requirements of the Delaware corporation law and the
Certificate, such Preferred Stock Directors shall cease to
be Directors of the Corporation and shall resign.
The Corporation will not, without the approval of
the holders of at least 66-2/3% of all the shares of PRIDES
then outstanding: (i) amend, alter, or repeal any of the
provisions of the Certificate or the By-laws of the
Corporation so as to affect adversely the powers,
preferences, or rights of the holders of the shares of
PRIDES then outstanding or reduce the minimum time required
for any notice to which only the holders of the shares of
PRIDES then outstanding may be entitled (an amendment of the
Certificate to authorize or create, or to increase the
authorized amount of, Junior Stock, Preferred Stock or any
stock of any class ranking on a parity with the shares of
PRIDES shall be deemed not to affect adversely the powers,
preferences, or rights of the holders of the shares of
PRIDES); (ii) create any series of Preferred Stock ranking
prior to the shares of PRIDES as to payment of dividends or
the distribution of assets upon liquidation; (iii) authorize
or create, or increase the authorized amount of, any capital
stock, or any security convertible into capital stock, of
any class ranking prior to the shares of PRIDES as to
payment of dividends or the distribution of assets upon
liquidation; or (iv) merge or consolidate with or into any
other corporation, unless each holder of the shares of
PRIDES immediately preceding such merger or consolidation
shall receive or continue to hold in the resulting
corporation the same number of shares, with substantially
the same rights and preferences, as correspond to the shares
of PRIDES so held.
As long as any shares of PRIDES are outstanding,
the Corporation will not, without the approval of the
holders of at least a majority of the shares of Parity
Preferred Stock then outstanding: (i) increase the
authorized amount of the Preferred Stock or (ii) create any
class or classes of capital stock ranking on a parity with
the Parity Preferred Stock, either as to payment of
dividends or the distribution of assets upon liquidation,
and not existing on the date of this Certificate of
Designations, or create any stock, or other security,
convertible into or exchangeable for or evidencing the right
to purchase any stock of such other class of capital stock
ranking on a parity with the Parity Preferred Stock, or
increase the authorized number of shares of any such other
class of capital stock or amount of such other stock or
security.
Notwithstanding the provisions set forth in the
preceding two paragraphs, however, no such approval
described therein of the holders of the shares of PRIDES
shall be required if, at or prior to the time when such
amendment, alteration, or repeal is to take effect or when
the authorization, creation or increase of any such prior or
parity stock or such other stock or security is to be made,
or when such consolidation or merger is to take effect, as
the case may be, provision is made for the redemption of all
shares of PRIDES at the time outstanding.
10. Severability of Provisions. Whenever
possible, each provision hereof shall be interpreted in a
manner as to be effective and valid under applicable law,
but if any provision hereof is held to be prohibited by or
invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or
invalidity, without invalidating or otherwise adversely
affecting the remaining provisions hereof. If a court of
competent jurisdiction should determine that a provision
hereof would be valid or enforceable if a period of time
were extended or shortened or a particular percentage were
increased or decreased, then such court may make such change
as shall be necessary to render the provision in question
effective and valid under applicable law.
IN WITNESS WHEREOF, Bowater Incorporated has
caused this Certificate of Designations to be signed by
David G. Maffucci , its Vice President-Treasurer, and
attested by Wendy C. Shiba,its Secretary and Assistant
General Counsel, this ___ day of February, 1994.
BOWATER INCORPORATED,
by /s/ David G. Maffucci
_______________________
[CORPORATE SEAL]
ATTEST:
by /s/ Wendy C. Shiba
____________________
BOWATER INCORPORATED
CERTIFICATE OF DESIGNATIONS
OF THE
8.40% SERIES C CUMULATIVE PREFERRED STOCK
__________________
Pursuant to Section 151 of the General
Corporation Law of the State of Delaware
___________________
BOWATER INCORPORATED, a corporation organized and
existing under the laws of the State of Delaware (the
"Corporation"), hereby certifies that the following
resolution was duly adopted by the Board of Directors of the
Corporation (the "Board of Directors") at a meeting duly
called and held on January 26, 1994, at which meeting a
quorum of the members of the Board of Directors was present
and acting throughout, and was duly amended and supplemented
by the action of the Pricing Committee (the "Pricing
Committee") of the Board of Directors, acting pursuant to
authority delegated to the Pricing Committee by the Board of
Directors on October 27, 1993, and January 26, 1994, at a
meeting duly called and held on February 1, 1994, at which
meeting a quorum of the members of the Pricing Committee was
present and acting throughout.
RESOLVED that, pursuant to authority expressly
vested in the Board of Directors by the provisions of the
Restated Certificate of Incorporation of the Corporation
(the "Certificate"), the Board of Directors hereby provides
for the issuance of a series of serial preferred stock of
the Corporation, par value $1.00 per share (all series of
serial preferred stock of the Corporation being hereinafter
referred to collectively as the "Preferred Stock"), to
consist of 850,000 shares, and hereby fixes the powers,
designation, preferences and relative, participating,
optional and other rights of such series of Preferred Stock,
and the qualifications, limitations and restrictions
thereof, as follows:
1. Designation; Ranking. (a) The designation of
the series of Preferred Stock created by this resolution
shall be "8.40% Series C Cumulative Preferred Stock"
(hereinafter called the "Cumulative Preferred Stock"), and
the number of shares constituting the Cumulative Preferred
Stock is 850,000.
(b) Any shares of the Cumulative Preferred Stock
that at any time have been redeemed, purchased or otherwise
acquired by the Corporation shall, after such redemption,
purchase or other acquisition, resume the status of
authorized and unissued shares of Preferred Stock without
designation as to series until such shares are once more
designated as part of a particular series by the Board of
Directors.
(c) The shares of Cumulative Preferred Stock will
rank on a parity, both as to payment of dividends and
distribution of assets upon liquidation, with the
Corporation's LIBOR Preferred Stock, Series A, and its 7%
PRIDES, Series B Convertible Preferred Stock, as well as any
Preferred Stock issued in the future by the Corporation that
by its terms ranks pari passu with the shares of Cumulative
Preferred Stock.
2. Dividends. The holders of record of the
shares of Cumulative Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of Directors
out of funds legally available therefor, cash dividends
("Preferred Dividends") from the date of the initial
issuance of the shares of Cumulative Preferred Stock at the
rate of 8.40 percent of the $100 liquidation preference per
annum, payable quarterly in arrears on the 15th day of
January, April, July and October or, if any such date is not
a business day (as defined in paragraph 7 hereof), the
Preferred Dividend due on such date shall be payable on the
next succeeding business day (each a "Dividend Payment
Date"). The first dividend period will be from the date of
initial issuance of the shares of Cumulative Preferred Stock
to but excluding April 15, 1994 and will be payable on
April 15, 1994. Preferred Dividends will cease to accrue in
respect of the shares of Cumulative Preferred Stock on the
date of their redemption. Preferred Dividends will be
payable to holders of record of the Cumulative Preferred
Stock as they appear on the stock register of the
Corporation on such record dates, not less than 15 nor more
than 60 days preceding the payment date thereof, as shall be
fixed by the Board of Directors. Preferred Dividends
payable on shares of Cumulative Preferred Stock for any
period less than a full quarterly dividend period (or, in
the case of the first Preferred Dividend, from the date of
initial issuance of the shares of Cumulative Preferred Stock
to the first Dividend Payment Date) shall be computed on the
basis of a 360-day year of twelve 30-day months and the
actual number of days elapsed in any period less than
one month. Preferred Dividends shall accrue on a daily
basis (computed as set forth in the immediately preceding
sentence) whether or not there are funds of the Corporation
legally available for the payment of such dividends and
whether or not such Preferred Dividends are declared.
Accrued but unpaid Preferred Dividends shall cumulate as of
the Dividend Payment Date on which they first become
payable, but no interest shall accrue on accumulated but
unpaid Preferred Dividends.
As long as shares of Cumulative Preferred Stock
are outstanding, no dividends (other than dividends payable
in shares of, or warrants, rights or options exercisable for
or convertible into shares of, any capital stock of the
Corporation, including without limitation the Corporation's
common stock, $1.00 par value per share ("Common Stock"),
ranking junior to the shares of Cumulative Preferred Stock
as to the payment of dividends and the distribution of
assets upon liquidation (collectively, "Junior Stock") and
cash in lieu of fractional shares in connection with any
such dividend) will be paid or declared in cash or
otherwise, nor will any other distribution be made (other
than a distribution payable in Junior Stock and cash in lieu
of fractional shares in connection with any such
distribution), on any Junior Stock unless (i) full dividends
on Preferred Stock that does not constitute Junior Stock
("Parity Preferred Stock") have been paid, or declared and
set aside for payment, for all dividend periods terminating
on or prior to the date of such Junior Stock dividend or
distribution payment to the extent such dividends are
cumulative; (ii) dividends in full for the current quarterly
dividend period have been paid, or declared and set aside
for payment, on all Parity Preferred Stock to the extent
such dividends are cumulative; (iii) the Corporation has
paid or set aside all amounts, if any, then or theretofore
required to be paid or set aside for all purchase,
retirement, and sinking funds, if any, for any Parity
Preferred Stock; and (iv) the Corporation is not in default
on any of its obligations to redeem any Parity Preferred
Stock.
As long as any shares of Cumulative Preferred
Stock are outstanding, no shares of Junior Stock may be
purchased, redeemed, or otherwise acquired by the
Corporation or any of its subsidiaries (except in connection
with a reclassification or exchange of any Junior Stock
through the issuance of other Junior Stock (and cash in lieu
of fractional shares in connection therewith) or the
purchase, redemption, or other acquisition of any Junior
Stock with any Junior Stock (and cash in lieu of fractional
shares in connection therewith)) nor may any funds be set
aside or made available for any sinking fund for the
purchase, redemption or acquisition of any Junior Stock
unless: (i) full dividends on Parity Preferred Stock have
been paid, or declared and set aside for payment, for all
dividend periods terminating on or prior to the date of such
purchase, redemption, acquisition, setting aside or making
available to the extent such dividends are cumulative; (ii)
dividends in full for the current quarterly dividend period
have been paid, or declared and set aside for payment, on
all Parity Preferred Stock to the extent such dividends are
cumulative; (iii) the Corporation has paid or set aside all
amounts, if any, then or theretofore required to be paid or
set aside for all purchase, retirement, and sinking funds,
if any, for any Parity Preferred Stock; and (iv) the
Corporation is not in default on any of its obligations to
redeem any Parity Preferred Stock.
As long as any shares of Cumulative Preferred
Stock are outstanding, dividends or other distributions may
not be declared or paid on any Parity Preferred Stock (other
than dividends or other distributions payable in Junior
Stock and cash in lieu of fractional shares in connection
therewith) and the Corporation may not purchase, redeem or
otherwise acquire any Parity Preferred Stock (except with
any Junior Stock and cash in lieu of fractional shares in
connection therewith and except with the right, subject to
clause (b) of this paragraph and any similar requirement of
any other Certificate of Designations for Preferred Stock,
to receive accrued and unpaid dividends), unless
either: (a)(i) full dividends on Parity Preferred Stock
have been paid, or declared and set aside for payment, for
all dividend periods terminating on or prior to the date of
such Parity Preferred Stock dividend, distribution,
redemption, purchase or acquisition payment to the extent
such dividends are cumulative; (ii) dividends in full for
the current quarterly dividend period have been paid, or
declared and set aside for payment, on all Parity Preferred
Stock to the extent such dividends are cumulative; (iii) the
Corporation has paid or set aside all amounts, if any, then
or theretofore required to be paid or set aside for all
purchase, retirement, and sinking funds, if any, for any
Parity Preferred Stock; and (iv) the Corporation is not in
default on any of its obligations to redeem any Parity
Preferred Stock; or (b) with respect to the declaration and
payment of dividends only, any such dividends are declared
and paid pro rata so that the amounts of any dividends
declared and paid per share of Cumulative Preferred Stock
and each other share of Parity Preferred Stock will in all
cases bear to each other the same ratio that accrued and
unpaid dividends (including any accumulation with respect to
unpaid dividends for prior dividend periods, if such
dividends are cumulative) per share of Cumulative Preferred
Stock and such other share of Parity Preferred Stock bear to
each other.
3. Redemption. The shares of Cumulative
Preferred Stock are not redeemable by the Corporation prior
to February 8, 1999. At any time and from time to time on
or after that date the Corporation will have the right to
redeem, in whole or in part, outstanding shares of
Cumulative Preferred Stock for $100 per share, plus accrued
and unpaid dividends (whether or not declared) to, but not
including, the date fixed for redemption (other than
previously declared dividends payable to a holder of record
as of a prior date). Preferred Dividends will cease to
accrue on the shares of Cumulative Preferred Stock on the
date fixed for their redemption (unless the Corporation
defaults on the payment of the redemption price). If fewer
than all of the outstanding shares of Cumulative Preferred
Stock are to be called for redemption, shares of Cumulative
Preferred Stock to be called for redemption will be selected
by the Corporation from outstanding shares of Cumulative
Preferred Stock not previously called by lot or pro rata (as
nearly as may be) or by any other method determined by the
Board of Directors in its sole discretion to be equitable.
The Corporation will provide notice of any call for
redemption of shares of Cumulative Preferred Stock to
holders of record of the shares of Cumulative Preferred
Stock to be called for redemption not less than 30 nor more
than 60 days prior to the date fixed for redemption. Any
such notice will be provided by mail, sent to the holders of
record of the shares of Cumulative Preferred Stock to be
called for redemption at such holder's address as it appears
on the stock register of the Corporation, first class
postage prepaid; provided, however, that failure to give
such notice or any defect therein shall not affect the
validity of the proceeding for the redemption of any shares
of Cumulative Preferred Stock to be redeemed except as to
the holder to whom the Corporation has failed to give said
notice or whose notice was defective. On and after the
redemption date, all rights of the holders of the shares of
Cumulative Preferred Stock called for redemption shall
terminate except the right to receive the redemption price
(unless the Corporation defaults on the payment of the
redemption price). A public announcement of any call for
redemption will be made by the Corporation prior to, or at
the time of, the mailing of such notice of redemption. Each
such notice shall state, as appropriate, the following and
may contain such other information as the Corporation deems
advisable:
(A) the redemption date;
(B) that all outstanding shares of Cumulative
Preferred Stock are to be redeemed or, in the case of a
redemption of fewer than all outstanding shares of
Cumulative Preferred Stock, the number of such shares
held by such holder to be redeemed;
(C) the place or places where certificates for
such shares of Cumulative Preferred Stock are to be
surrendered for redemption; and
(D) that dividends on the shares of Cumulative
Preferred Stock to be redeemed shall cease to accrue on
and after such redemption date (except as otherwise
provided herein).
The Corporation's obligation to provide funds upon
redemption in accordance with this paragraph 3 shall be
deemed fulfilled if, on or before a redemption date, the
Corporation shall deposit, with a bank or trust company, or
an affiliate of a bank or trust company, having an office or
agency in New York, New York and having a capital and
surplus of at least $50,000,000 according to its last
published statement of condition, the redemption price for
the shares of Cumulative Preferred Stock to be redeemed as
required by this paragraph 3, in trust for the account of
the holders of such shares of Cumulative Preferred Stock to
be redeemed (and so as to be and continue to be available
therefor), with irrevocable instructions and authority to
such bank or trust company, or affiliate thereof, to deliver
such funds upon redemption of the shares of Cumulative
Preferred Stock so called for redemption. Any interest
accrued on such funds shall be paid to the Corporation from
time to time. Any funds so deposited and unclaimed at the
end of three years from such redemption date shall be repaid
and released to the Corporation, after which, subject to
applicable law, the holder or holders of such shares of
Cumulative Preferred Stock so called for redemption shall
look only to the Corporation for payment of the funds due in
connection with the redemption of such shares of Cumulative
Preferred Stock.
Each holder of shares of Cumulative Preferred
Stock called for redemption must surrender the certificates
evidencing such shares (properly endorsed or assigned for
transfer, if the Board of Directors shall so require and the
notice shall so state) to the Corporation at the place
designated in the notice of such redemption and will
thereupon be entitled to receive any funds payable pursuant
to this paragraph 3, without interest, following such
surrender and on or following the date of such redemption.
In case fewer than all the shares represented by any such
surrendered certificate are called for redemption, a new
certificate shall be issued at the expense of the
Corporation representing the unredeemed shares. If such
notice of redemption shall have been given, and funds equal
to the redemption price of all redeemed shares of Cumulative
Preferred Stock shall have been irrevocably either (A) set
aside by the Corporation separate and apart from its other
funds or assets in trust for the account of the holders of
the shares to be redeemed (and so as to be and continue to
be available therefor) or (B) deposited with a bank or trust
company or an affiliate thereof as provided herein or the
Corporation shall have made other reasonable provision
therefor, then notwithstanding that the certificates
evidencing any shares of Cumulative Preferred Stock so
called for redemption shall not have been surrendered, the
shares represented thereby so called for redemption shall be
deemed no longer outstanding, Preferred Dividends with
respect to the shares so called for redemption shall cease
to accrue on the date fixed for redemption and all rights
with respect to the shares so called for redemption shall
forthwith after such date cease and terminate, except for
the rights of the holders to funds, if any, payable pursuant
to this paragraph 3 without interest upon surrender of their
certificates therefor and except that holders of shares of
Cumulative Preferred Stock at the close of business on a
record date (preceding the redemption date) for any payment
of Preferred Dividends shall be entitled to receive the
Preferred Dividend payable on such shares on the
corresponding Dividend Payment Date notwithstanding the
redemption of such shares following such record date and
prior to such Dividend Payment Date.
4. Conversion. The holders of shares of
Cumulative Preferred Stock shall not have any rights to
convert such shares into shares of any other class or series
of capital stock of the Corporation.
5. Liquidation Rights. In the event of any
voluntary or involuntary liquidation, dissolution or winding
up of the Corporation, and subject to the rights of the
holders of any other series of Preferred Stock, the holders
of outstanding shares of Cumulative Preferred Stock are
entitled to receive the sum of $100 per share, plus an
amount equal to any accrued and unpaid dividends thereon,
out of the assets of the Company available for distribution
to stockholders, before any distribution of assets is made
to holders of Junior Stock upon liquidation, dissolution, or
winding up. If upon any voluntary or involuntary
liquidation, dissolution, or winding up of the Corporation,
the assets of the Corporation are insufficient to permit the
payment of the full preferential amounts payable with
respect to shares of Cumulative Preferred Stock and all
other series of Parity Preferred Stock, the holders of
shares of Cumulative Preferred Stock and of all other series
of Parity Preferred Stock will share ratably in any
distribution of assets of the Corporation in proportion to
the full respective preferential amounts to which they are
entitled. After payment of the full amount of the
liquidating distribution to which they are entitled, the
holders of shares of Cumulative Preferred Stock will not be
entitled to any further participation in any distribution of
assets by the Corporation. A consolidation or merger of the
Corporation with one or more corporations or a sale or
transfer of substantially all of the assets of the
Corporation shall not be deemed to be a liquidation,
dissolution, or winding up of the Corporation.
6. Voting Rights. In the event that dividends on
the shares of Cumulative Preferred Stock or any other series
of Preferred Stock shall be in arrears and unpaid for six
quarterly dividend periods, or if any other series of
Preferred Stock shall be entitled for any other reason to
exercise voting rights, separate from the Common Stock, to
elect any Directors of the Corporation ("Preferred Stock
Directors"), the holders of the shares of Cumulative
Preferred Stock (voting separately as a class with holders
of all other series of Preferred Stock upon which like
voting rights have been conferred and are exercisable), with
each share of Cumulative Preferred Stock entitled to one
vote on this and other matters in which Preferred Stock
votes as a group, will be entitled to vote for the election
of two Preferred Stock Directors, such Directors to be in
addition to the number of Directors constituting the Board
of Directors immediately prior to the accrual of such right.
Such right, when vested, shall continue until all dividends
in arrears on the shares of Cumulative Preferred Stock and
such other series of Preferred Stock shall have been paid in
full and the right of any other series of Preferred Stock to
exercise voting rights, separate from the Common Stock, to
elect any Preferred Stock Directors shall terminate or have
terminated, and, when so paid and such termination occurs or
has occurred, such right of the holders of the shares of
Cumulative Preferred Stock shall cease. Upon any
termination of the aforesaid voting right, subject to the
requirements of the Delaware corporation law and the
Certificate, such Preferred Stock Directors shall cease to
be Directors of the Corporation and shall resign.
The Corporation will not, without the approval of
the holders of at least 66-2/3% of all the Cumulative
Preferred Stock then outstanding: (i) amend, alter, or
repeal any of the provisions of the Certificate or the By-
laws of the Corporation so as to affect adversely the
powers, preferences, or rights of the holders of the
Cumulative Preferred Stock then outstanding or reduce the
minimum time required for any notice to which only the
holders of the Cumulative Preferred Stock then outstanding
may be entitled (an amendment of the Certificate to
authorize or create, or to increase the authorized amount
of, Junior Stock, Preferred Stock or any stock of any class
ranking on a parity with the Cumulative Preferred Stock
shall be deemed not to affect adversely the powers,
preferences, or rights of the holders of the Cumulative
Preferred Stock); (ii) create any series of Preferred Stock
ranking prior to the shares of Cumulative Preferred Stock as
to payment of dividends or the distribution of assets upon
liquidation; (iii) authorize or create, or increase the
authorized amount of, any capital stock, or any security
convertible into capital stock, of any class ranking prior
to the Cumulative Preferred Stock as to payment of dividends
or the distribution of assets upon liquidation; or
(iv) merge or consolidate with or into any other
corporation, unless each holder of the Cumulative Preferred
Stock immediately preceding such merger or consolidation
shall receive or continue to hold in the resulting
corporation the same number of shares, with substantially
the same rights and preferences, as correspond to the
Cumulative Preferred Stock so held.
As long as any shares of Cumulative Preferred
Stock are outstanding, the Corporation will not, without the
approval of the holders of at least a majority of the shares
of Parity Preferred Stock then outstanding: (i) increase
the authorized amount of the Preferred Stock or (ii) create
any class or classes of capital stock ranking on a parity
with the Parity Preferred Stock, either as to payment of
dividends or the distribution of assets upon liquidation,
and not existing on the date of this Certificate of
Designations, or create any stock, or other security,
convertible into or exchangeable for or evidencing the right
to purchase any stock of such other class of capital stock
ranking on a parity with the Parity Preferred Stock, or
increase the authorized number of shares of any such other
class of capital stock or amount of such other stock or
security.
Notwithstanding the provisions set forth in the
preceding two paragraphs, however, no such approval
described therein of the holders of the shares of Cumulative
Preferred Stock shall be required if, at or prior to the
time when such amendment, alteration, or repeal is to take
effect or when the authorization, creation or increase of
any such prior or parity stock or such other stock or
security is to be made, or when such consolidation or merger
is to take effect, as the case may be, provision is made for
the redemption of all shares of Cumulative Preferred Stock
at the time outstanding.
7. Definitions. As used in this Certificate of
Designations:
(i) the term "business day" shall mean any day
other than a Saturday, a Sunday or a day on which
commercial banking institutions in the City of New
York, New York, or Atlanta, Georgia, are authorized or
obligated by law or executive order to close; and
(ii) the term "record date" shall be such date as
is from time to time fixed by the Board of Directors
with respect to the receipt of dividends, the receipt
of a redemption price upon redemption or the taking of
any action or exercise of any voting rights permitted
hereby.
8. Severability of Provisions. Whenever
possible, each provision hereof shall be interpreted in a
manner as to be effective and valid under applicable law,
but if any provision hereof is held to be prohibited by or
invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or
invalidity, without invalidating or otherwise adversely
affecting the remaining provisions hereof. If a court of
competent jurisdiction should determine that a provision
hereof would be valid or enforceable if a period of time
were extended or shortened or a particular percentage were
increased or decreased, then such court may make such change
as shall be necessary to render the provision in question
effective and valid under applicable law.
IN WITNESS WHEREOF, Bowater Incorporated has
caused this Certificate of Designations to be signed by
David G. Maffucci, its Vice President-Treasurer and attested
by Wendy C. Shiba, its Secretary and Assistant General
Counsel, this ____ day of February, 1994.
BOWATER INCORPORATED,
by /s/ David G. Maffucci
__________________________
[CORPORATE SEAL]
ATTEST:
by /s/ Wendy C. Shiba
_______________________
CONFORMED COPY
BOWATER INCORPORATED
TRUST COMPANY BANK, as Depositary
and
THE HOLDERS FROM TIME TO TIME OF
THE DEPOSITARY RECEIPTS DESCRIBED HEREIN
IN RESPECT OF THE
7% PRIDES, SERIES B CONVERTIBLE PREFERRED STOCK
_______
Deposit Agreement
_______
Dated as of February 1, 1994
TABLE OF CONTENTS
Page
PARTIES 1
RECITALS 1
ARTICLE I
DEFINITIONS
Business Day 1
Certificate of Designations 2
Certificate of Incorporation 2
Common Stock 2
Company 2
Corporate Office 2
Deposit Agreement 2
Depositary 2
Depositary Share 2
Depositary's Agent 3
Receipt 3
record holder 3
Registrar 3
Rights 3
Securities Act 3
Series B Preferred Stock 3
ARTICLE II
FORM OF RECEIPTS, DEPOSIT OF SERIES B PREFERRED STOCK,
EXECUTION AND DELIVERY, TRANSFER,
SURRENDER AND REDEMPTION OF RECEIPTS
SECTION 2.01. Form and Transferability
of Receipts 3
SECTION 2.02. Deposit of Series B Preferred Stock;
Execution and Delivery of Receipts
in Respect Thereof 5
SECTION 2.03. Redemption of Series B Preferred
Stock 6
SECTION 2.04. Transfer of Receipts 9
SECTION 2.05. Combination and Split-ups of Receipts 10
SECTION 2.06. Surrender of Receipts and Withdrawal
of Series B Preferred Stock 10
SECTION 2.07 Limitations on Execution and Delivery,
Transfer, Split-up, Combination,
Surrender and Exchange of Receipts 11
SECTION 2.08. Lost Receipts, etc. 12
SECTION 2.09. Cancellation and Destruction of
Surrendered Receipts 12
SECTION 2.10. Optional Conversion of Series B Preferred
Stock into Common Stock 12
SECTION 2.11. Mandatory Conversion of Series B Preferred
Stock into Common Stock 16
ARTICLE III
CERTAIN OBLIGATIONS OF HOLDERS
OF RECEIPTS AND THE COMPANY
SECTION 3.01. Filing Proofs, Certificates and Other
Information 18
SECTION 3.02. Payment of Taxes or Other Governmental
Charges 19
SECTION 3.03. Representations and Warranties as to
Series B Preferred Stock 19
ARTICLE IV
THE SERIES B PREFERRED STOCK, NOTICES
SECTION 4.01. Cash Distributions 20
SECTION 4.02. Distributions Other Than Cash 20
SECTION 4.03. Subscription Rights, Preferences or
Privileges 21
SECTION 4.04. Notice of Dividends, Fixing of Record
Date for Holders of Receipts 22
SECTION 4.05. Voting Rights 23
SECTION 4.06. Changes Affecting Series B Preferred
Stock and Reclassifications,
Recapitalizations, etc. 23
SECTION 4.07. Inspection of Reports 24
SECTION 4.08. List of Receipt Holders 24
ARTICLE V
THE DEPOSITARY AND THE COMPANY
SECTION 5.01. Maintenance of Offices, Agencies,
Transfer Books by the Depositary, the
Registrar 24
SECTION 5.02. Prevention of or Delay in Performance
by the Depositary, the Depositary's
Agents or the Company 25
SECTION 5.03. Obligations of the Depositary, the
Depositary's Agents and the Company 26
SECTION 5.04. Resignation and Removal of the
Depositary; Appointment of Successor
Depositary 28
SECTION 5.05. Corporate Notices and Reports 29
SECTION 5.06. Deposit of Series B Preferred Stock
by the Company 29
SECTION 5.07. Indemnification by the Company 30
SECTION 5.08. Fees, Charges and Expenses 30
ARTICLE VI
AMENDMENT AND TERMINATION
SECTION 6.01. Amendment 30
SECTION 6.02. Termination 31
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. Counterparts 32
SECTION 7.02. Exclusive Benefits of Parties 32
SECTION 7.03. Invalidity of Provisions 33
SECTION 7.04. Notices 33
SECTION 7.05. Depositary's Agents 34
SECTION 7.06. Holders of Receipts Are Parties 34
SECTION 7.07. Governing Law 34
SECTION 7.08. Headings 34
TESTIMONIUM 35
SIGNATURES 35
EXHIBIT A: Form of Depositary Receipt
DEPOSIT AGREEMENT
DEPOSIT AGREEMENT dated as of
February 1, 1994, among Bowater Incorporated,
a Delaware corporation, Trust Company Bank,
as depositary (the "Depositary"), and all
holders from time to time of Depositary
Receipts executed and delivered hereunder.
WHEREAS, it is desired to provide, as hereinafter
set forth in this Deposit Agreement, for the deposit of
shares of 7% PRIDES, Series B Convertible Preferred Stock,
par value $1 per share (the "Series B Preferred Stock") of
the Company with the Depositary, as agent for the beneficial
owners of the Series B Preferred Stock, for the purposes set
forth in this Deposit Agreement and for the execution and
delivery hereunder of the Receipts (as defined below)
evidencing Depositary Shares (as defined below) in respect
of the Series B Preferred Stock so deposited; and
WHEREAS, the Receipts are to be substantially in
the form of the Depositary Receipt annexed as Exhibit A,
with appropriate insertions, modifications and omissions, as
hereinafter provided in this Deposit Agreement;
NOW, THEREFORE, in consideration of the premises
contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE I
DEFINITIONS
The following definitions shall apply to the
respective terms (in the singular and plural forms of such
terms) used in this Agreement and the Depositary Receipts:
"Business Day" shall mean any day other than a
Saturday, a Sunday or a day on which commercial banking
institutions in the City of New York, New York, or Atlanta,
Georgia, are authorized or obligated by law or executive
order to close.
"Certificate of Designations" shall mean the
Certificate of Designations of the 7% PRIDES, Series B
Convertible Preferred Stock, par value $1 per share, as
filed with the Secretary of State of the State of Delaware,
establishing and setting forth the rights, preferences,
privileges and limitations of the Series B Preferred Stock.
"Certificate of Incorporation" shall mean the
Restated Certificate of Incorporation, as amended from time
to time, of the Company.
"Common Stock" shall mean the Common Stock, par
value $1 per share, of the Company.
"Company" shall mean Bowater Incorporated, a
Delaware corporation, and its successors.
"Corporate Office" shall mean the office of the
Depositary in the city of Atlanta, Georgia, at which at any
particular time its business in respect of matters governed
by this Deposit Agreement shall be administered, which at
the date of this Deposit Agreement is located at One Park
Place, Atlanta, Georgia.
"Deposit Agreement" shall mean this agreement, as
the same may be amended, modified or supplemented from time
to time.
"Depositary" shall mean Trust Company Bank, as
Depositary hereunder, and any successor as depositary
hereunder.
"Depositary Share" shall mean an interest in
one-fourth of a share of the Series B Preferred Stock
deposited with the Depositary hereunder and the same
proportional interest in any and all other property received
by the Depositary in respect of such share of Series B
Preferred Stock and held under this Deposit Agreement, all
as evidenced by the Receipts executed and delivered
hereunder. Subject to the terms of this Deposit Agreement,
each owner of a Depositary Share is entitled,
proportionately, to all the rights, preferences and
privileges of the Series B Preferred Stock represented by
such Depositary Share, including the dividend, voting and
liquidation rights contained in the Certificate of
Designations, and to the benefits of all obligations of the
Company under the Certificate of Designations.
"Depositary's Agent" shall mean an agent appointed
by the Depositary as provided, and for the purposes
specified, in Section 7.05.
"Receipt" or "Depositary Receipt" shall mean a
Depositary Receipt executed and delivered hereunder to
evidence one or more Depositary Shares, whether in
definitive or temporary form.
The term "record holder" as applied to a Receipt
shall mean the person in whose name a Receipt is registered
on the books maintained by the Depositary for such purpose.
"Registrar" shall mean any bank or trust company
appointed to register Receipts as herein provided.
"Rights" shall mean the rights issuable under the
Rights Agreement dated as of April 22, 1986, as amended,
between the Company and The Bank of New York as successor
Rights Agent to Morgan Guaranty Trust Company of New York,
as Rights Agent, as such Agreement may be amended, modified
or supplemented from time to time.
"Securities Act" shall mean the Securities Act of
1933, as amended.
"Series B Preferred Stock" shall mean the 7%
PRIDES, Series B Convertible Preferred Stock, par value $1
per share, of the Company.
ARTICLE II
FORM OF RECEIPTS, DEPOSIT OF SERIES B PREFERRED STOCK,
EXECUTION AND DELIVERY, TRANSFER AND SURRENDER OF RECEIPTS
SECTION 2.01. Form and Transferability of
Receipts. Definitive Receipts shall be engraved or printed
or lithographed with steel-engraved borders and shall be
substantially in the form set forth in Exhibit A annexed to
this Deposit Agreement, with appropriate insertions,
modifications and omissions, as hereinafter provided.
Pending preparation of definitive Receipts, the Depositary,
upon the written order of the Company or any holder of
Series B Preferred Stock, as the case may be, delivered for
deposit in compliance with Section 2.02, shall execute and
deliver temporary Receipts which are printed, lithographed,
typewritten, mimeographed or otherwise substantially of the
tenor of the definitive Receipts in lieu of which they are
executed and delivered and with such appropriate insertions,
omissions, substitutions and other variations as the persons
executing such Receipts may determine, as evidenced by their
execution of such Receipts. If temporary Receipts are
executed and delivered, the Company and the Depositary will
cause definitive Receipts to be prepared without
unreasonable delay. After the preparation of definitive
Receipts, the temporary Receipts shall be exchangeable for
definitive Receipts upon surrender of the temporary Receipts
at an office described in the second to last paragraph of
Section 2.02, without charge to the holder. Upon surrender
for cancellation of any one or more temporary Receipts, the
Depositary shall execute and deliver in exchange therefor
definitive Receipts representing the same number of
Depositary Shares as represented by the surrendered
temporary Receipt or Receipts. Such exchange shall be made
at the Company's expense and without any charge therefor.
Until so exchanged, the temporary Receipts shall in all
respects be entitled to the same benefits under this
Agreement, and with respect to the Series B Preferred Stock
deposited hereunder, as definitive Receipts.
Receipts shall be executed by the Depositary by
the manual signature of a duly authorized signatory of the
Depositary; provided, however, that such signature may be a
facsimile if a Registrar (other than the Depositary) shall
have countersigned the Receipts by the manual signature of a
duly authorized signatory of the Registrar. No Receipt
shall be entitled to any benefits under this Deposit
Agreement or be valid or obligatory for any purpose unless
it shall have been executed as provided in the preceding
sentence. The Depositary shall record on its books each
Receipt executed as provided above and delivered as
hereinafter provided.
Except as the Depositary may otherwise determine,
Receipts shall be in denominations of any number of whole
Depositary Shares. All Receipts shall be dated the date of
their execution.
Receipts may be endorsed with or have incorporated
in the text thereof such legends or recitals or changes not
inconsistent with the provisions of this Deposit Agreement
as may be required by the Depositary or required to comply
with any applicable law or regulation or with the rules and
regulations of any securities exchange upon which the Series
B Preferred Stock or the Depositary Shares may be listed or
to conform with any usage with respect thereto, or to
indicate any special limitations or restrictions to which
any particular Receipts are subject by reason of the date of
issuance of the Series B Preferred Stock or otherwise.
Title to any Receipt (and to the Depositary Shares
evidenced by such Receipt) that is properly endorsed or
accompanied by a properly executed instrument of transfer or
endorsement, or other instrument satisfactory to the
Depositary, shall be transferable by delivery; provided,
however, that until a Receipt shall be transferred on the
books of the Depositary as provided in Section 2.04, the
Depositary and the Company may, notwithstanding any notice
to the contrary, treat the record holder thereof at such
time as the absolute owner thereof for the purpose of
determining the person entitled to distribution of dividends
or other distributions or to any notice provided for in this
Deposit Agreement and for all other purposes.
SECTION 2.02. Deposit of Series B Preferred
Stock; Execution and Delivery of Receipts in Respect
Thereof. Subject to the terms and conditions of this
Deposit Agreement, the Company or any holder of Series B
Preferred Stock may deposit shares of Series B Preferred
Stock under this Deposit Agreement by delivery to the
Depositary of a certificate or certificates for the shares
of Series B Preferred Stock to be deposited, properly
endorsed or accompanied by a properly executed instrument of
transfer or endorsement in form satisfactory to the
Depositary, together with (i) all such certifications as may
be required by the Depositary in accordance with the
provisions of this Deposit Agreement and (ii) a written
order directing the Depositary to execute and deliver to or
upon the written order of the person or persons stated in
such order a Receipt or Receipts for the number of
Depositary Shares representing such deposited Series B
Preferred Stock.
If required by the Depositary, Series B Preferred
Stock presented for deposit at any time, whether or not the
register of holders of Receipts is closed, shall also be
accompanied by an agreement or assignment, or other
instrument satisfactory to the Depositary, that will provide
for the prompt transfer to the Depositary or its nominee of
any dividend or right to subscribe for additional Series B
Preferred Stock or to receive other property that any person
in whose name the Series B Preferred Stock is or has been
registered may thereafter receive upon or in respect of such
deposited Series B Preferred Stock, or in lieu thereof such
agreement of indemnity or other agreement as shall be
satisfactory to the Depositary.
Upon receipt by the Depositary of a certificate or
certificates for the shares of Series B Preferred Stock to
be deposited hereunder, together with the other documents
specified above, the Depositary shall, as soon as transfer
and registration can be accomplished, present such
certificates to the registrar and transfer agent of the
Series B Preferred Stock for transfer and registration in
the name of the Depositary or its nominee of the shares of
Series B Preferred Stock being deposited. Deposited Series
B Preferred Stock shall be held by the Depositary in an
account to be established by the Depositary at the Corporate
Office.
Upon receipt by the Depositary of a certificate or
certificates for Series B Preferred Stock to be deposited
hereunder, together with the other documents specified
above, the Depositary, subject to the terms and conditions
of this Deposit Agreement, shall execute and deliver to or
upon the order of the person or persons named in the written
order delivered to the Depositary referred to in the first
paragraph of this Section 2.02 a Receipt or Receipts for the
number of whole Depositary Shares representing the Series B
Preferred Stock so deposited and registered in such name or
names as may be requested by such person or persons. The
Depositary shall execute and deliver such Receipt or
Receipts at the Corporate Office, except that, at the
request, risk and expense of any person requesting such
delivery, such delivery may be made at such other place as
may be designated by such person. In each case, delivery
will be made only upon payment by such person to the
Depositary of all taxes and other governmental charges and
any fees payable in connection with such deposit and the
transfer of the deposited Series B Preferred Stock.
The Company shall deliver to the Depositary from
time to time such quantities of Receipts as the Depositary
may request to enable the Depositary to perform its
obligations under this Deposit Agreement.
SECTION 2.03. Redemption of Series B Preferred
Stock. Whenever the Company shall elect to redeem shares of
Series B Preferred Stock in accordance with the Certificate
of Designations it shall (unless otherwise agreed in writing
with the Depositary) give the Depositary in its capacity as
Depositary notice of the date of such proposed redemption of
the Series B Preferred Stock, which notice shall be given
not less than 3 Business Days prior to the date the
Depositary is to mail notice of the redemption to the record
holders of Receipts, in the case of a redemption of all
outstanding Depositary Shares, and not less than 10 calendar
days prior to the date the Depositary is to mail notice of
the redemption to the record holders of Receipts evidencing
the Depositary Shares to be redeemed, in the case of a
partial redemption of outstanding Depositary Shares, and be
accompanied by a certificate from the Company stating that
such redemption of the Series B Preferred Stock is in
accordance with the provisions of the Certificate of
Designations. Such notice shall be in addition to the
notice required to be given for redemption pursuant to the
Certificate of Designations. On the date of any such
redemption of Series B Preferred Stock, provided that the
Company shall then have deposited with the Depositary the
shares of Common Stock as required pursuant to the
Certificate of Designations to be delivered in exchange for
the Series B Preferred Stock to be redeemed, the Depositary
shall redeem (using the shares of Common Stock and any cash
deposited with it) the number of Depositary Shares
representing such redeemed Series B Preferred Stock.
Subject to the penultimate sentence of this Paragraph, the
Depositary shall mail, first class postage prepaid, notice
of the redemption of Series B Preferred Stock and the
proposed simultaneous redemption of the Depositary Shares
representing the Series B Preferred Stock to be redeemed,
not less than 15 and not more than 60 days prior to the date
fixed for redemption of such Series B Preferred Stock and
Depositary Shares (the "Redemption Date"), to the record
holders of the Receipts evidencing the Depositary Shares to
be so redeemed, at the addresses of such holders as they
appear on the records of the Depositary; but neither failure
to mail any such notice to one or more such holders nor any
defect in any notice to one or more such holders shall
affect the sufficiency of the proceedings for redemption as
to other holders. Each such notice shall state: (i) the
Redemption Date; (ii) the number of Depositary Shares to be
redeemed and, if less than all the Depositary Shares held by
any such holder are to be redeemed, the number of such
Depositary Shares held by such holder to be so redeemed;
(iii) the number of shares of Common Stock deliverable upon
redemption; (iv) the call price for the Depositary Shares;
(v) the Optional Conversion Rate (calculated in accordance
with paragraph 3 of the Certificate of Designations),
together with a statement that all conversion rights with
respect to Depositary Shares called for redemption will
terminate immediately prior to the close of business on the
date fixed for redemption; (vi) the place or places where
Receipts evidencing Depositary Shares are to be surrendered
for payment of the redemption price; and (vii) that
dividends in respect of the shares of Series B Preferred
Stock represented by the Depositary Shares to be redeemed
will cease to accumulate on such Redemption Date. Any such
notices shall be mailed in the same manner as notices of
redemption of the Series B Preferred Stock are required to
be mailed pursuant to paragraph 3 of the Certificate of
Designations and published in the same manner as notices of
redemption of the Series B Preferred Stock are required to
be published pursuant to said paragraph, if so required. In
case fewer than all the outstanding Depositary Shares are to
be redeemed, the Depositary Shares to be redeemed shall be
selected by lot or pro rata (as nearly as may be) or by any
other equitable method determined by the Depositary to be
consistent with the method determined by the Board of
Directors of the Company with respect to the Series B
Preferred Stock.
Notice having been mailed and published by the
Depositary as aforesaid, from and after the Redemption Date
(unless the Company shall have failed to redeem the shares
of Series B Preferred Stock to be redeemed by it, as set
forth in the Company's notice provided for in the preceding
paragraph), the Depositary Shares called for redemption
shall be deemed no longer to be outstanding and all rights
of the holders of Receipts evidencing such Depositary Shares
(except the right to receive the shares of Common Stock upon
redemption and cash for any fractional share amount) shall,
to the extent of such Depositary Shares, cease and
terminate. Upon surrender in accordance with said notice of
the Receipts evidencing such Depositary Shares (properly
endorsed or assigned for transfer, if the Depositary shall
so require), such Depositary Shares shall be redeemed for
shares of Common Stock and cash for any fractional share
amount at a rate per Depositary Share equal to one-fourth of
the number of shares of Common Stock (including fractional
amounts) delivered upon redemption of a share of Series B
Preferred Stock pursuant to the Certificate of Designations.
The foregoing shall be subject further to the terms and
conditions of the Certificate of Designations.
If fewer than all of the Depositary Shares
evidenced by a Receipt are called for redemption, the
Depositary will deliver to the holder of such Receipt upon
its surrender to the Depositary, together with the shares of
Common Stock for the Depositary Shares called for
redemption, a new Receipt evidencing the Depositary Shares
evidenced by such prior Receipt and not called for
redemption.
To the extent that Depositary Shares are redeemed
for shares of Common Stock and all of such shares of Common
Stock cannot be distributed to the record holders of
Receipts without creating fractional interests in such
shares, the Depositary may, with the consent of the Company,
adopt such method as it deems equitable and practicable for
the purpose of effecting such distribution, including the
sale (at public or private sale) of such shares of Common
Stock at such place or places and upon such terms as it may
deem proper, and the net proceeds of any such sale shall,
subject to Section 3.02, be distributed or made available
for distribution to such record holders that would otherwise
receive fractional interests in such shares of Common Stock.
In the event that Depositary Shares are redeemed
into shares of Common Stock and certificates evidencing
Rights are issued or to be issued in connection therewith,
such certificates shall be distributed in the same manner
and to the same record holders receiving the shares of
Common Stock associated with such Rights and fractional
interests in Rights shall be subject to the same procedures
set forth in the preceding paragraph for fractional shares
of Common Stock.
Except with respect to a conversion of Depositary
Shares which may occur pursuant to paragraph 3 of the
Certificate of Designations, the Depositary shall not be
required (a) to execute and deliver, transfer or exchange
any Receipts for a period beginning at the opening of
business 15 days next preceding any selection of Depositary
Shares and Series B Preferred Stock to be redeemed and
ending at the close of business on the day of the mailing of
notice of redemption of Depositary Shares or (b) to transfer
or exchange for another Receipt any Receipt evidencing
Depositary Shares called or being called for redemption in
whole or in part, except as provided in the third paragraph
of this Section 2.03.
SECTION 2.04. Transfer of Receipts. Subject to
the terms and conditions of this Deposit Agreement, the
Depositary shall make transfers on its books from time to
time of Receipts upon any surrender thereof at the Corporate
Office or such other office as the Depositary may designate
for such purpose, by the holder in person or by a duly
authorized attorney, properly endorsed or accompanied by a
properly executed instrument of transfer or endorsement, or
other instrument satisfactory to the Depositary, together
with evidence of the payment of any transfer taxes as may be
required by law. Upon such surrender, the Depositary shall
execute a new Receipt or Receipts and deliver the same to or
upon the order of the person or persons entitled thereto
evidencing the same aggregate number of Depositary Shares
evidenced by the Receipt or Receipts surrendered.
SECTION 2.05. Combination and Split-ups of
Receipts. Upon surrender of a Receipt or Receipts at the
Corporate Office or such other office as the Depositary may
designate for the purposes of effecting a split-up or
combination of Receipts, subject to the terms and conditions
of this Deposit Agreement, the Depositary shall execute and
deliver a new Receipt or Receipts in the authorized
denominations requested evidencing the same aggregate number
of Depositary Shares evidenced by the Receipt or Receipts
surrendered; provided, however, that the Depositary shall
not execute and deliver any Receipt evidencing a fractional
Depositary Share.
SECTION 2.06. Surrender of Receipts and
Withdrawal of Series B Preferred Stock. Any holder of a
Receipt or Receipts may withdraw any or all of the Series B
Preferred Stock (but only in whole shares of Series B
Preferred Stock) represented by the Depositary Shares
evidenced by such Receipts and all money and other property,
if any, represented by such Depositary Shares by
surrendering such Receipt or Receipts, properly endorsed or
accompanied by a properly executed instrument of transfer or
endorsement, or other instrument satisfactory to the
Depositary, at the Corporate Office or such other office as
the Depositary may designate for such withdrawals. After
such surrender, without unreasonable delay, the Depositary
shall deliver to such holder, or to the person or persons
designated by such holder as hereinafter provided, the whole
number of shares of Series B Preferred Stock and all such
money and other property, if any, represented by the
Depositary Shares evidenced by the Receipt or Receipts so
surrendered for withdrawal. If the Receipt or Receipts
delivered by the holder to the Depositary in connection with
such withdrawal shall evidence a number of Depositary Shares
in excess of the number of whole Depositary Shares
representing the whole number of shares of Series B
Preferred Stock to be withdrawn, the Depositary shall at the
same time, in addition to such whole number of shares of
Series B Preferred Stock and such money and other property,
if any, to be withdrawn, deliver to such holder, or (subject
to Section 2.04) upon his order, a new Receipt or Receipts
evidencing such excess number of whole Depositary Shares.
Delivery of the Series B Preferred Stock and such money and
other property being withdrawn may be made by the delivery
of such certificates, documents of title, and other
instruments as the Depositary may deem appropriate, which,
if required by the Depositary, shall be properly endorsed or
accompanied by proper instruments of transfer.
If the Series B Preferred Stock and the money and
other property being withdrawn are to be delivered to a
person or persons other than the record holder of the
Receipt or Receipts being surrendered for withdrawal of
Series B Preferred Stock, such holder shall execute and
deliver to the Depositary a written order so directing the
Depositary and the Depositary may require that the Receipt
or Receipts surrendered by such holder for withdrawal of
such shares of Series B Preferred Stock be properly endorsed
in blank or accompanied by a properly executed instrument of
transfer or endorsement in blank.
The Depositary shall deliver the Series B
Preferred Stock and the money and other property, if any,
represented by the Depositary Shares evidenced by Receipts
surrendered for withdrawal at the Corporate Office, except
that, at the request, risk and expense of the holder
surrendering such Receipt or Receipts and for the account of
the holder thereof, such delivery may be made at such other
place as may be designated by such holder.
SECTION 2.07 Limitations on Execution and
Delivery, Transfer, Split-up, Combination, Surrender and
Exchange of Receipts. As a condition precedent to the
execution and delivery, transfer, split-up, combination,
surrender or exchange of any Receipt, the Depositary, any of
the Depositary's Agents or the Company may require any or
all of the following: (i) payment to it of a sum sufficient
for the payment (or, in the event that the Depositary or the
Company shall have made such payment, the reimbursement to
it) of any tax or other governmental charge with respect
thereto (including any such tax or charge with respect to
the Series B Preferred Stock being deposited or withdrawn or
with respect to the Common Stock, Rights or other securities
or property of the Company being issued upon conversion or
redemption); (ii) the production of proof satisfactory to it
as to the identity and genuineness of any signature; and
(iii) compliance with such regulations, if any, as the
Depositary or the Company may establish not inconsistent
with the provisions of the Deposit Agreement.
The deposit of Series B Preferred Stock may be
refused, the delivery of Receipts against Series B Preferred
Stock may be suspended, the transfer of Receipts may be
refused, and the transfer, split-up, combination, surrender
or exchange of outstanding Receipts may be suspended (i)
during any period when the register of holders of Receipts
is closed, (ii) if any such action is deemed necessary or
advisable by the Depositary, any of the Depositary's Agents
or the Company at any time or from time to time because of
any requirement of law or of any government or governmental
body or commission, or under any provision of this Deposit
Agreement, or (iii) with the approval of the Company, for
any other reason.
SECTION 2.08. Lost Receipts, etc. In case any
Receipt shall be mutilated or destroyed or lost or stolen,
the Depositary in its discretion may execute and deliver a
Receipt of like form and tenor in exchange and substitution
for such mutilated Receipt or in lieu of and in substitution
for such destroyed, lost or stolen Receipt; provided,
however, that the holder thereof provides the Depositary
with (i) evidence satisfactory to the Depositary of such
destruction, loss or theft of such Receipt, of the
authenticity thereof and of his ownership thereof, (ii)
reasonable indemnification satisfactory to the Depositary
and (iii) payment of any expense (including fees, charges
and expenses of the Depositary) in connection with such
execution and delivery.
SECTION 2.09. Cancellation and Destruction of
Surrendered Receipts. All Receipts surrendered to the
Depositary or any Depositary's Agent shall be cancelled by
the Depositary. Except as prohibited by applicable law or
regulation, the Depositary is authorized to destroy such
Receipts so cancelled.
SECTION 2.10. Optional Conversion of Series B
Preferred Stock into Common Stock. Receipts may be
surrendered with written instructions to the Depositary to
instruct the Company to cause the conversion of any
specified number of whole shares of Series B Preferred Stock
represented by whole Depositary Shares evidenced by such
Receipts into whole shares of Common Stock and cash for any
fractional share amount at the conversion price then in
effect for the Series B Preferred Stock pursuant to the
Certificate of Designations as such conversion price may be
adjusted by the Company from time to time as provided in the
Certificate of Designations. Subject to the terms and
conditions of this Deposit Agreement and the Certificate of
Designations, a holder of a Receipt or Receipts evidencing
Depositary Shares representing whole or fractional shares of
Series B Preferred Stock may surrender such Receipt or
Receipts at the Corporate Office or at such office or to
such Depositary's Agents as the Depositary may designate for
such purpose, together with a notice of conversion duly
completed and executed, thereby directing the Depositary to
instruct the Company to cause the conversion of the number
of whole shares of underlying Series B Preferred Stock
specified in such notice of conversion into shares of Common
Stock, and an assignment of such Receipt or Receipts to the
Company or in blank, duly completed and executed. To the
extent that a holder delivers to the Depositary for
conversion a Receipt or Receipts which in the aggregate are
convertible into less than one whole share of Common Stock,
the holder shall receive payment in cash in lieu of such
fractional share of Common Stock otherwise issuable. If
more than one Receipt shall be delivered for conversion at
one time by the same holder, the number of whole shares of
Common Stock issuable upon conversion thereof shall be
computed on the basis of the aggregate number of Depositary
Shares represented by the Receipts so delivered.
Upon receipt by the Depositary of a Receipt or
Receipts, together with notice of conversion, duly completed
and executed, directing the Depositary to instruct the
Company to cause the conversion of a specified number of
shares of Series B Preferred Stock, and an assignment of
such Receipt or Receipts to the Company or in blank, duly
completed and executed, the Depositary shall instruct the
Company (i) to cause the conversion of the number of whole
shares of Series B Preferred Stock represented by the
Depositary Shares evidenced by the Receipts so surrendered
for conversion as specified in the written notice to the
Depositary and (ii) to cause the delivery to the holders of
such Receipts of a certificate or certificates evidencing
the number of whole shares of Common Stock and the amount of
money, if any, to be delivered to the holders of Receipts
surrendered for conversion in lieu of fractional shares of
Common Stock otherwise issuable. The Company shall as
promptly as practicable after receipt thereof cause the
delivery of (i) a certificate or certificates evidencing the
number of whole shares of Common Stock into which the Series
B Preferred Stock represented by the Depositary Shares
evidenced by such Receipt or Receipts has been converted,
and (ii) any money or other property to which the holder is
entitled by reason of such conversion. Upon such
conversion, the Depositary (i) shall deliver to the holder a
Receipt evidencing the number of Depositary Shares, if any,
that equals the excess of the number of Depositary Shares
evidenced by the surrendered Receipt over the number of
Depositary Shares evidenced by such Receipt that has been so
converted, (ii) shall cancel the Depositary Shares evidenced
by Receipts surrendered for conversion and (iii) shall
deliver to the Company or its transfer agent for the Series
B Preferred Stock for cancellation the shares of Series B
Preferred Stock represented by the Depositary Shares
evidenced by the Receipts so surrendered and so converted.
Upon the delivery of the shares of Series B Preferred Stock
to be cancelled due to such conversion by the Depositary to
the Company, the Company shall deliver to the Depositary a
certificate or certificates evidencing the number of shares
of Series B Preferred Stock, if any, that equals the excess
of the number of shares of Series B Preferred Stock
evidenced by the surrendered certificate over the number of
shares of Series B Preferred Stock evidenced by that
certificate that has been so converted.
If Series B Preferred Stock shall be called by the
Company for redemption, the Depositary Shares representing
such Stock may be converted into Common Stock as provided in
this Deposit Agreement until, but not after, the close of
business on the Redemption Date unless the Company shall
fail to deposit with the Depositary the shares of Common
Stock and cash for any fractional share amounts required to
redeem the Series B Preferred Stock held by the Depositary,
in which case the Depositary Shares representing such Series
B Preferred Stock may continue to be converted into Common
Stock until, but not after, the close of business on the
date on which the Company deposits with the Depositary such
shares of Common Stock and cash for any fractional share
amounts as are required by the Certificate of Designations
to make full payment of the amounts payable upon such
redemption. Upon receipt by the Depositary of a Receipt or
Receipts, together with a properly completed and executed
notice of conversion, representing any Series B Preferred
Stock called for redemption, the shares of Series B
Preferred Stock held by the Depositary represented by such
Depositary Shares for which conversion is requested shall be
deemed to have been received by the Company for conversion
as of immediately prior to the close of business on the date
of such receipt by the Depositary.
The record holder of Depositary Shares on any
dividend payment record date established by the Depositary
pursuant to Section 4.04 shall be entitled to receive the
dividend payable with respect to such Depositary Shares on
the corresponding dividend payment date notwithstanding the
conversion subsequent to such record date of the shares of
Series B Preferred Stock to which such Depositary Shares
relate. If a share of Series B Preferred Stock is converted
between the record date with respect to any dividend payment
on the Series B Preferred Stock and the corresponding
dividend payment date, any holder of Receipts surrendered
with instructions to the Depositary for conversion of the
underlying Series B Preferred Stock shall pay to the
Depositary an amount equal to the dividend attributable to
the current quarterly dividend period payable on such
dividend payment date on the Depositary Shares represented
by the Receipts being surrendered for conversion (except for
Depositary Shares redeemed on a Redemption Date between such
record date and dividend payment date). Any holder of
Receipts on a dividend payment record date who (or whose
transferee) surrenders the Receipts with instructions to the
Depositary for conversion of the underlying Series B
Preferred Stock on the corresponding dividend payment date
will receive the dividend payable with respect to the
Depositary Shares underlying such Receipts and will not be
required to include payment of the amount of such dividend
upon surrender of the Receipts for conversion.
Upon the conversion of any share of Series B
Preferred Stock for which a request for conversion has been
made by the holder of Depositary Shares representing such
share, all dividends in respect of such Depositary Shares
shall cease to accrue, such Depositary Shares shall be
deemed no longer outstanding, all rights of the holder of
the Receipt with respect to such Depositary Shares (except
the right to receive the Common Stock, any cash payable with
respect to any fractional shares of Common Stock as provided
herein and any cash payable on account of accrued dividends
as provided herein and any Receipts evidencing Depositary
Shares not so converted) shall terminate, and the Receipt
evidencing such Depositary Shares shall be cancelled in
accordance with Section 2.09 hereof.
No fractional shares of Common Stock shall be
issuable upon conversion of Series B Preferred Stock
underlying the Depositary Shares. If any holder of Receipts
surrendered with instructions to the Depositary for
conversion of the underlying Series B Preferred Stock would
be entitled to a fractional share of Common Stock upon such
conversion, the Company shall cause to be delivered to such
holder an amount in cash for such fractional share as
provided in the Certificate of Designations.
SECTION 2.11. Mandatory Conversion of Series B
Preferred Stock into Common Stock. With respect to any
Series B Preferred Stock on deposit with the Depositary as
to which the Company has not exercised its right to redeem
and the record holder has not exercised its right of
optional conversion pursuant to the Certificate of
Designations, the Depositary shall mail, first class postage
prepaid, notice of the mandatory conversion of Series B
Preferred Stock and the simultaneous mandatory conversion of
the Depositary Shares representing the Series B Preferred
Stock to be mandatorily converted, not less than 5 and not
more than 15 days prior to the date fixed for mandatory
conversion of such Series B Preferred Stock and Depositary
Shares (the "Mandatory Conversion Date"), to all record
holders of Receipts evidencing Depositary Shares who are of
record on the date that is two Business Days prior to the
date of mailing, at the addresses of such holders as they
appear on the records of the Depositary; but neither failure
to mail any such notice to one or more such holders nor any
defect in any notice to one or more such holders shall
affect the sufficiency of the proceedings for mandatory
conversion as to any record holder (whether or not such
failure or defect affects such record holder). Each such
notice shall state: (i) the Mandatory Conversion Date;
(ii) that all outstanding Depositary Shares on the Mandatory
Conversion Date will be mandatorily converted pursuant to
the Certificate of Designations and this Agreement; (iii)
the Common Equivalent Rate (determined in accordance with
paragraph 3 of the Certificate of Designations); (iv) the
place or places where Receipts evidencing Depositary Shares
are to be surrendered for payment of the mandatory
conversion price; and (v) that dividends in respect of the
shares of Series B Preferred Stock represented by the
Depositary Shares to be mandatorily converted will cease to
accumulate on the Mandatory Conversion Date.
On the Mandatory Conversion Date, all then
outstanding shares of Series B Preferred Stock shall
mandatorily convert into shares of Common Stock, cash for
any fractional share amounts and the right to receive
amounts in cash equal to all accrued and unpaid dividends on
such shares of Series B Preferred Stock to the Mandatory
Conversion Date (other than previously declared dividends
payable to a holder of record as of a prior date), all as
provided in and subject to paragraph 3 of the Certificate of
Designations.
From and after the Mandatory Conversion Date, the
Depositary Shares representing the shares of Series B
Preferred Stock mandatorily converted shall be deemed no
longer to be outstanding and all rights of the record
holders of Receipts evidencing such Depositary Shares
(except the right to receive the shares of Common Stock, any
cash for accrued and unpaid dividends (other than previously
declared dividends payable to a holder of record as of a
prior date) and any fractional share amount deliverable or
payable upon mandatory conversion or in connection
therewith) shall, to the extent of such Depositary Shares,
cease and terminate. Upon surrender, in accordance with
said notice, of the Receipts evidencing such Depositary
Shares (properly endorsed or assigned for transfer, if the
Depositary shall so require), such Depositary Shares shall
be exchanged for shares of Common Stock and cash for any
fractional share amount (and the right to receive cash for
any accrued and unpaid dividends payable in connection
therewith) at a rate per Depositary Share equal to one-
fourth of the number (including fractional amounts) of
shares of Common Stock (and one-fourth of the right to
receive cash for any accrued and unpaid dividends) exchanged
for each share of Series B Preferred Stock pursuant to the
Certificate of Designations. The foregoing shall be subject
further to the terms and conditions of the Certificate of
Designations.
On or prior to the Mandatory Conversion Date, the
Company shall deposit with the Depositary certificates for
the shares of Common Stock and the cash for any fractional
share amounts into which the shares of Series B Preferred
Stock held by the Depositary shall mandatorily convert on
the Mandatory Conversion Date, plus, subject to the
Certificate of Designations, an amount in cash equal to all
accrued and unpaid dividends on such shares of Series B
Preferred Stock (other than previously declared dividends
payable to a holder of record as of a prior date) to the
Mandatory Conversion Date. Using such shares of Common
Stock and cash, the Depositary shall deliver certificates
for the appropriate number of shares of Common Stock and the
appropriate amount of cash, without interest, to record
holders who properly deliver their Receipts to the
Depositary.
No fractional shares of Common Stock shall be
issuable upon mandatory conversion of Series B Preferred
Stock underlying the Depositary Shares. If any holder of
Receipts surrendered to the Depositary for mandatory
conversion of the underlying Series B Preferred Stock would
be entitled to a fractional share of Common Stock upon such
mandatory conversion, the Company shall cause to be
delivered to such holder an amount in cash for such
fractional share as provided in the Certificate of
Designations. To the extent that Depositary Shares are
mandatorily converted into shares of Common Stock and all of
such shares of Common Stock cannot be distributed to the
record holders of Receipts without creating fractional
interest in such shares, the Depositary may, with the
consent of the Company, adopt such method as it deems
equitable and practicable for the purpose of effecting such
distribution, including the sale (at public or private sale)
of such shares of Common Stock at such place or places and
upon such terms as it may deem proper, and the net proceeds
of any such sale shall, subject to Section 3.02, without
interest, be distributed or made available for distribution
to such record holders that would otherwise receive
fractional interests in such shares of Common Stock.
ARTICLE III
CERTAIN OBLIGATIONS OF HOLDERS
OF RECEIPTS AND THE COMPANY
SECTION 3.01. Filing Proofs, Certificates and
Other Information. Any person presenting Series B Preferred
Stock for deposit or any holder of a Receipt may be required
from time to time to file such proof of residence or other
information, to execute such certificates and to make such
representations and warranties as the Depositary or the
Company may reasonably deem necessary or proper. The
Depositary or the Company may withhold or delay the delivery
of any Receipt, the transfer, redemption, conversion, or
exchange of any Receipt, the withdrawal of the Series B
Preferred Stock or money or other property, if any,
represented by the Depositary Shares evidenced by any
Receipt or the distribution of any dividend or other
distribution until such proof or other information is filed,
such certificates are executed or such representations and
warranties are made.
SECTION 3.02. Payment of Taxes or Other
Governmental Charges. If any tax or other governmental
charge shall become payable by or on behalf of the
Depositary with respect to any Receipt, the Depositary
Shares evidenced by such Receipt, the Series B Preferred
Stock (or fractional interest therein) represented by such
Depositary Shares or any transaction referred to in
Section 4.06, such tax (including transfer, issuance or
acquisition taxes, if any) or governmental charge shall be
payable by the holder of such Receipt. Until such payment
is made, transfer, redemption, conversion, or exchange of
any Receipt or any withdrawal of the Series B Preferred
Stock or money or other property, if any, represented by the
Depositary Shares evidenced by such Receipt may be refused,
any dividend or other distribution with respect to such
Receipt or the Series B Preferred Stock represented by the
Depositary Shares evidenced by such Receipt may be withheld
and any part or all of the Series B Preferred Stock or other
property represented by the Depositary Shares evidenced by
such Receipt may be sold for the account of the holder
thereof (after attempting by reasonable means to notify such
holder prior to such sale). Any dividend or other
distribution so withheld and the proceeds of any such sale
may be applied to any payment of such tax or other
governmental charge, the holder of such Receipt remaining
liable for any deficiency. The Depositary shall act as the
withholding agent for any payments, distributions, and
exchanges made with respect to the Depositary Shares and
Receipts, and the Series B Preferred Stock, Common Stock,
Rights or other securities or assets represented thereby
(collectively, the "Securities"). The Depositary shall be
responsible with respect to the Securities for the timely
(i) collection and deposit of any required withholding or
backup withholding tax, and (ii) filing of any information
returns or other documents with federal (and other
applicable) taxing authorities. In the event the Depositary
is required to pay any such amounts, the Company shall
reimburse the Depositary for payment thereof upon the
request of the Depositary and the Depositary shall, upon the
Company's request and as instructed by the Company, pursue
its rights against such holder at the Company's expense.
SECTION 3.03. Representations and Warranties as
to Series B Preferred Stock. Each person depositing Series
B Preferred Stock under this Deposit Agreement shall be
deemed thereby to represent and warrant that such Series B
Preferred Stock and each certificate therefor are valid and
that the person making such deposit is duly authorized to do
so. Such representations and warranties shall survive the
deposit of the Series B Preferred Stock and the execution
and delivery of Receipts.
ARTICLE IV
THE SERIES B PREFERRED STOCK, NOTICES
SECTION 4.01. Cash Distributions. Whenever the
Depositary shall receive any cash dividend or other cash
distribution on the Series B Preferred Stock, the Depositary
shall, subject to Section 3.02, distribute to record holders
of Receipts on the record date fixed pursuant to
Section 4.04 such portions of such sum as are, as nearly as
practicable, proportionate to the respective numbers of
Depositary Shares evidenced by the Receipts held by such
holders; provided, however, that in case the Company or the
Depositary shall be required to withhold and does withhold
from any cash dividend or other cash distribution in respect
of the Series B Preferred Stock an amount on account of
taxes or as otherwise required by law, regulation or court
order, the amount made available for distribution or
distributed in respect of Depositary Shares shall be reduced
accordingly. The Depositary shall distribute or make
available for distribution, as the case may be, only such
amount, however, as can be distributed without attributing
to any owner of Depositary Shares a fraction of one cent and
any balance not so distributable shall be held by the
Depositary (without liability for interest thereon) and
shall be added to and be treated as part of the next sum
received by the Depositary for distribution to record
holders of Receipts then outstanding.
SECTION 4.02. Distributions Other Than Cash.
Whenever the Depositary shall receive any distribution other
than cash on the Series B Preferred Stock, the Depositary
shall, subject to Section 3.02, distribute to record holders
of Receipts on the record date fixed pursuant to
Section 4.04 such portions of the securities or property
received by it as are, as nearly as practicable,
proportionate to the respective numbers of Depositary Shares
evidenced by the Receipts held by such holders, in any
manner that the Depositary and the Company may deem
equitable and practicable for accomplishing such
distribution. If, in the opinion of the Company after
consultation with the Depositary, such distribution cannot
be made proportionately among such record holders, or if for
any other reason (including any requirement that the Company
or the Depositary withhold an amount on account of taxes or
as otherwise required by law, regulation or court order),
the Depositary deems, after consultation with the Company,
such distribution not to be feasible, the Depositary may,
with the approval of the Company, adopt such method as it
deems equitable and practicable for the purpose of effecting
such distribution, including the sale (at public or private
sale) of the securities or property thus received, or any
part thereof, at such place or places and upon such terms as
it may deem proper. The net proceeds of any such sale
shall, subject to Section 3.02, be distributed or made
available for distribution, as the case may be, by the
Depositary to record holders of Receipts as provided by
Section 4.01 in the case of a distribution received in cash.
SECTION 4.03. Subscription Rights, Preferences or
Privileges. If the Company shall at any time offer or cause
to be offered to the persons in whose names Series B
Preferred Stock is registered on the books of the Company
any rights, preferences or privileges to subscribe for or to
purchase any securities or any rights, preferences or
privileges of any other nature, such rights, preferences or
privileges shall in each such instance be made available by
the Depositary to the record holders of Receipts if the
Company so directs in such manner as the Company shall
instruct (including by the execution and delivery to such
record holders of warrants representing such rights,
preferences or privileges); provided, however, that (a) if
at the time of issue or offer of any such rights,
preferences or privileges the Company determines that it is
not lawful or feasible to make such rights, preferences or
privileges available to some or all holders of Receipts (by
the execution and delivery of warrants or otherwise) or (b)
if and to the extent instructed by holders of Receipts who
do not desire to exercise such rights, preferences or
privileges, the Depositary shall then, if so instructed by
the Company, and if applicable laws and the terms of such
rights, preferences or privileges so permit, sell such
rights, preferences or privileges of such holders at public
or private sale, at such place or places and upon such terms
as it may deem proper. The net proceeds of any such sale
shall, subject to Section 3.02, be distributed by the
Depositary to the record holders of Receipts entitled
thereto in accordance with the withholding and fractional
amount provisions of Section 4.01.
If registration under the Securities Act of the
securities to which any rights, preferences or privileges
relate is required in order for holders of Receipts to be
offered or sold such securities, the Company shall promptly
file a registration statement pursuant to the Securities Act
with respect to such securities and use its best efforts and
take all steps available to it to cause such registration
statement to become effective sufficiently in advance of the
expiration of such rights, preferences or privileges to
enable such holders to exercise such rights, preferences or
privileges. In no event shall the Depositary make available
to the holders of Receipts any right, preference or
privilege to subscribe for or to purchase any securities
unless and until notified by the Company in writing that
such registration statement has become effective or that the
offering and sale of such securities to such holders are
exempt from registration under the provisions of the
Securities Act.
If any other action under the law of any
jurisdiction or any governmental or administrative
authorization, consent or permit is required in order for
such rights, preferences or privileges to be made available
to holders of Receipts, the Company agrees with the
Depositary that the Company will use its best efforts to
take such action or obtain such authorization, consent or
permit sufficiently in advance of the expiration of such
rights, preferences or privileges to enable such holders to
exercise such rights, preferences or privileges.
SECTION 4.04. Notice of Dividends, Fixing of
Record Date for Holders of Receipts. Whenever any cash
dividend or other cash distribution shall become payable, or
any distribution other than cash shall be made, or any
rights, preferences or privileges shall at any time be
offered, with respect to the Series B Preferred Stock, or
whenever the Depositary shall receive notice of (i) any
meeting at which holders of Series B Preferred Stock are
entitled to vote or of which holders of Series B Preferred
Stock are entitled to notice or (ii) any election on the
part of the Company to call for redemption any shares of
Series B Preferred Stock, the Depositary shall in each such
instance fix a record date (which shall be the same date as
the record date fixed by the Company with respect to the
Series B Preferred Stock) for the determination of the
holders of Receipts (i) who shall be entitled to receive
such dividend, distribution, rights, preferences or
privileges or the net proceeds of the sale thereof, or to
give instructions for the exercise of voting rights at any
such meeting or to receive notice of such meeting or
(ii) whose Depositary Shares are to be so redeemed.
SECTION 4.05. Voting Rights. Upon issuance of
notice of any meeting at which the holders of Series B
Preferred Stock are entitled to vote, the Company shall
direct the Depositary, as soon as practicable thereafter, to
mail to the record holders of Receipts a notice, which shall
be provided by the Company and which shall contain (i) such
information as is contained in such notice of meeting, (ii)
a statement that the holders of Receipts at the close of
business on a specified record date fixed pursuant to
Section 4.04 will be entitled, subject to any applicable
provision of law, the Certificate of Incorporation or the
Certificate of Designations, to instruct the Depositary as
to the exercise of the voting rights pertaining to the
amount of Series B Preferred Stock represented by their
respective Depositary Shares and (iii) a brief statement as
to the manner in which such instructions may be given. Upon
the written request of a holder of a Receipt on such record
date, the Depositary shall endeavor insofar as practicable
to vote or cause to be voted the amount of Series B
Preferred Stock represented by the Depositary Shares
evidenced by such Receipt in accordance with the
instructions set forth in such request. The Company hereby
agrees to take all reasonable action that may be deemed
necessary by the Depositary in order to enable the
Depositary to vote such Series B Preferred Stock or cause
such Series B Preferred Stock to be voted. In the absence
of specific instructions from the holder of a Receipt, the
Depositary will abstain from voting to the extent of the
Series B Preferred Stock represented by the Depositary
Shares evidenced by such Receipt. After aggregating all
voting Depositary Shares, the Depositary will disregard for
voting purposes any fractional share of Series B Preferred
Stock remaining.
SECTION 4.06. Changes Affecting Series B
Preferred Stock and Reclassifications, Recapitalizations,
etc. Upon any split-up, consolidation or any other
reclassification of Series B Preferred Stock, or upon any
recapitalization, reorganization, merger, amalgamation or
consolidation affecting the Company or to which it is a
party or sale of all or substantially all of the Company's
assets, the Depositary shall, upon the instructions of the
Company, treat any shares of stock or other securities or
property (including cash) that shall be received by the
Depositary in exchange for or upon conversion of or in
respect of the Series B Preferred Stock as new deposited
property under this Deposit Agreement, and Receipts then
outstanding shall thenceforth represent the proportionate
interests of holders thereof in the new deposited shares,
other securities or other property so received in exchange
for or upon conversion or in respect of such Series B
Preferred Stock. In any such case the Depositary may, in
its discretion, with the approval of the Company, execute
and deliver additional Receipts, or may call for the
surrender of all outstanding Receipts to be exchanged for
new Receipts specifically describing such new deposited
shares, other securities or other property.
SECTION 4.07. Inspection of Reports. The
Depositary shall make available for inspection by holders of
Receipts at the Corporate Office and at such other places as
it may from time to time deem advisable during normal
business hours any reports and communications received from
the Company that are both received by the Depositary as the
holder of Series B Preferred Stock and made generally
available to the holders of Series B Preferred Stock by the
Company.
SECTION 4.08. List of Receipt Holders. Promptly
upon request from time to time by the Company and at the
Company's expense, the Depositary shall furnish to it a
list, as of a recent date, of the names, addresses and
holdings of Depositary Shares of all persons in whose names
Receipts are registered on the books of the Depositary.
ARTICLE V
THE DEPOSITARY AND THE COMPANY
SECTION 5.01. Maintenance of Offices, Agencies,
Transfer Books by the Depositary, the Registrar. Upon
execution of this Deposit Agreement in accordance with its
terms, the Depositary shall maintain (i) at the Corporate
Office, facilities for the execution and delivery, transfer,
surrender and exchange, split-up and combination of Receipts
and deposit and withdrawal of Series B Preferred Stock and
(ii) at the offices of the Depositary's Agents, if any,
facilities for the delivery, transfer, surrender and
exchange, split-up, combination and redemption of Receipts
and deposit and withdrawal of Series B Preferred Stock, all
in accordance with the provisions of this Deposit Agreement.
The Depositary shall keep books at the Corporate
Office for the registration and transfer of Receipts, which
books during normal business hours shall be open for
inspection by the record holders of Receipts, as provided by
applicable law, and by the Company. The Depositary shall
consult with the Company upon receipt of any request for
inspection. The Depositary may close such books, at any
time or from time to time, when deemed expedient by it in
connection with the performance of its duties hereunder.
If the Receipts or the Depositary Shares evidenced
thereby or the Series B Preferred Stock represented by such
Depositary Shares shall be listed on the New York Stock
Exchange, Inc., the Depositary may, with the approval of the
Company, appoint a Registrar for registry of such Receipts
or Depositary Shares in accordance with the requirements of
such Exchange. Such Registrar (which may be the Depositary
if so permitted by the requirements of such Exchange) may be
removed and a substitute registrar appointed by the
Depositary upon the request or with the approval of the
Company. If the Receipts, such Depositary Shares or such
Series B Preferred Stock are listed on one or more other
stock exchanges, the Company will, with the assistance of
the Depositary, arrange such facilities for the delivery,
transfer, surrender and exchange of such Receipts, such
Depositary Shares or such Series B Preferred Stock as may be
required by law or applicable stock exchange regulations.
SECTION 5.02. Prevention of or Delay in
Performance by the Depositary, the Depositary's Agents or
the Company. Neither the Depositary nor any Depositary's
Agent nor the Company shall incur any liability to any
holder of any Receipt, if by reason of any provision of any
present or future law or regulation thereunder of the United
States of America or of any other governmental authority or,
in the case of the Depositary or the Depositary's Agent, by
reason of any provision, present or future, of the
Certificate of Incorporation or the Certificate of
Designations or, in the case of the Company, the Depositary
or the Depositary's Agent, by reason of any act of God or
war or other circumstance beyond the control of the relevant
party, the Depositary, any Depositary's Agent or the Company
shall be prevented or forbidden from doing or performing any
act or thing that the terms of this Deposit Agreement
provide shall be done or performed; nor shall the
Depositary, any Depositary's Agent or the Company incur any
liability to any holder of a Receipt by reason of any
nonperformance or delay, caused as aforesaid, in the
performance of any act or thing that the terms of this
Deposit Agreement provide shall or may be done or performed
or by reason of any exercise of, or failure to exercise, any
discretion provided for in this Deposit Agreement.
SECTION 5.03. Obligations of the Depositary, the
Depositary's Agents and the Company. Neither the Depositary
nor any Depositary's Agent nor the Company assumes any
obligation or shall be subject to any liability under this
Deposit Agreement or any Receipt to holders of Receipts
other than that each of them agrees to use good faith in the
performance of such duties as are specifically set forth in
this Deposit Agreement.
Neither the Depositary nor any Depositary's Agent
nor the Company shall be under any obligation to appear in,
prosecute or defend any action, suit or other proceeding
with respect to the Series B Preferred Stock, Depositary
Shares, Receipts or Common Stock that in its opinion may
involve it in expense or liability, unless indemnity
satisfactory to it against all expense and liability be
furnished as often as may be required.
Neither the Depositary nor any Depositary's Agent
nor the Company shall be liable for any action or any
failure to act by it in reliance upon the advice of, or
information from, legal counsel, accountants, any person
presenting Series B Preferred Stock for deposit, any holder
of a Receipt or any other person believed by it in good
faith to be competent to give such advice or information.
The Depositary, any Depositary's Agent and the Company may
each rely and shall each be protected in acting upon any
written notice, request, direction or other document
believed by it to be genuine and to have been signed or
presented by the proper party or parties.
The Depositary, its parent, affiliates,
subsidiaries, officers, directors or employees and any
Depositary's Agent may own, buy, sell or deal in any class
of securities of the Company and its affiliates and in
Receipts or Depositary Shares or become pecuniarily
interested in any transaction in which the Company or its
officers may be interested or contract with or lend money to
the Company or any of its affiliates or officers or
otherwise act fully or as freely as if it were not the
Depositary or the Depositary's Agent hereunder. The
Depositary may also act as transfer agent or registrar of
any of the securities of the Company and its affiliates.
It is intended that neither the Depositary nor any
Depositary's Agent shall be deemed to be an "issuer" of
securities under the federal securities laws or applicable
state securities laws, it being expressly understood and
agreed that the Depositary and any Depositary's Agent are
acting only in a ministerial capacity as Depositary for the
Series B Preferred Stock; provided, however, that the
Depositary agrees to comply with all information reporting
and withholding requirements applicable to it under law or
this Deposit Agreement in its capacity as Depositary.
Neither the Depositary (or its officers,
directors, employees or agents) nor any Depositary's Agent
makes any representation or has any responsibility as to the
validity of the Registration Statement pursuant to which the
Depositary Shares are registered under the Securities Act,
the Series B Preferred Stock, the Depositary Shares, the
Receipts (except for its countersignatures thereon) or any
instruments referred to therein or herein (other than an
instrument executed by the Depositary or Depositary's
Agent), or as to the correctness of any statement made
therein or herein or for the failure of the Company to
comply with any covenants contained in this Agreement or the
Receipts; provided, however, that the Depositary is
responsible for its representations in this Deposit
Agreement.
The Depositary assumes no responsibility for the
correctness of the description that appears in the Receipts,
which can be taken as a statement of the Company summarizing
certain provisions of this Deposit Agreement.
Notwithstanding any other provision herein or in the
Receipts, the Depositary makes no warranties or
representations as to the validity, genuineness or
sufficiency of any Series B Preferred Stock at any time
deposited with the Depositary hereunder or of the Depositary
Shares, as to the validity or sufficiency of this Deposit
Agreement, as to the value of the Depositary Shares or as to
any right, title or interest of the record holders of
Receipts in and to the Depositary Shares except that the
Depositary hereby represents and warrants as follows: (i)
the Depositary has been duly organized and is validly
existing and in good standing under the laws of the State of
Georgia, with full power, authority and legal right under
such laws to execute, deliver and carry out the terms of
this Deposit Agreement; (ii) this Deposit Agreement has been
duly authorized, executed and delivered by the Depositary;
and (iii) this Deposit Agreement constitutes a valid and
binding obligation of the Depositary, enforceable against
the Depositary in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting
enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a
proceeding in equity or at law). The Depositary shall not
be accountable for the use or application by the Company of
the Depositary Shares or the Receipts or the proceeds
thereof.
SECTION 5.04. Resignation and Removal of the
Depositary; Appointment of Successor Depositary. The
Depositary may at any time resign as Depositary hereunder by
notice of its election to do so delivered to the Company,
such resignation to take effect upon the appointment of a
successor depositary and its acceptance of such appointment
as hereinafter provided.
The Depositary may at any time be removed by the
Company by notice of such removal delivered to the
Depositary, such removal to take effect upon the appointment
of a successor depositary and its acceptance of such
appointment as hereinafter provided.
In case at any time the Depositary acting
hereunder shall resign or be removed, the Company shall,
within 45 days after the delivery of the notice of
resignation or removal, as the case may be, appoint a
successor depositary, which shall be a bank or trust
company, or an affiliate of a bank or trust company, having
its principal office in the United States of America and
having a combined capital and surplus of at least
$50,000,000. If a successor depositary shall not have been
appointed in 45 days, the resigning Depositary may petition
a court of competent jurisdiction to appoint a successor
depositary. Every successor depositary shall execute and
deliver to its predecessor and to the Company an instrument
in writing accepting its appointment hereunder, and
thereupon such successor depositary, without any further act
or deed, shall become fully vested with all the rights,
powers, duties and obligations of its predecessor and for
all purposes shall be the Depositary under this Deposit
Agreement, and such predecessor, upon payment of all sums
due it and on the written request of the Company, shall
promptly execute and deliver an instrument transferring to
such successor all rights and powers of such predecessor
hereunder, shall duly assign, transfer and deliver all
rights, title and interest in the Series B Preferred Stock
and any moneys or property held hereunder to such successor
and shall deliver to such successor a list of the record
holders of all outstanding Receipts and such other records
respecting the Receipts, the Depositary Shares and the
Series B Preferred Stock as the successor shall require in
order to perform its duties. Any successor depositary shall
promptly mail notice of its appointment to the record
holders of Receipts.
Any corporation into or with which the Depositary
may be merged, consolidated or converted shall be the
successor of such Depositary without the execution or filing
of any document or any further act. Such successor
depositary may execute the Receipts either in the name of
the predecessor depositary or in the name of the successor
depositary.
SECTION 5.05. Corporate Notices and Reports. The
Company agrees that it will deliver to the Depositary, and
the Depositary will, promptly after receipt thereof, and as
directed by the Company transmit to the record holders of
Receipts, in each case at the most recent address recorded
in the Depositary's books, copies of all notices and reports
(including financial statements) required by law, by the
rules of any national securities exchange upon which the
Series B Preferred Stock, the Depositary Shares, or the
Receipts are listed or by the Certificate of Incorporation
and the Certificate of Designations to be furnished by the
Company to holders of Series B Preferred Stock. Such
transmission will be at the Company's expense and the
Company will provide the Depositary with such number of
copies of such documents as the Depositary may reasonably
request. In addition, the Depositary will transmit to the
record holders of Receipts at the Company's expense such
other documents as may be requested by the Company.
SECTION 5.06. Deposit of Series B Preferred Stock
by the Company. Neither the Company nor any company
controlled by the Company will at any time deposit any
Series B Preferred Stock if such Series B Preferred Stock is
required to be registered under the provisions of the
Securities Act and no registration statement is at such time
in effect as to such Series B Preferred Stock.
SECTION 5.07. Indemnification by the Company.
The Company agrees to indemnify the Depositary, any
Depositary's Agent and any Registrar against, and hold each
of them harmless from, any liability, costs and expenses
(including reasonable attorneys' fees) that may arise out of
or in connection with its acting as Depositary, Depositary's
Agent or Registrar, respectively, under this Deposit
Agreement and the Receipts, except for any liability arising
out of negligence, bad faith or willful misconduct on the
part of any such person or persons.
SECTION 5.08. Fees, Charges and Expenses. No
fees, charges and expenses of the Depositary or any
Depositary's Agent hereunder or of any Registrar shall be
payable by any person other than the Company, except for any
taxes and other governmental charges and except as provided
in this Deposit Agreement. If the Depositary incurs fees,
charges or expenses for which it is not otherwise liable
hereunder at the election of a holder of a Receipt or other
person, such holder or other person will be liable for such
fees, charges and expenses. All other fees, charges and
expenses of the Depositary and any Depositary's Agent
hereunder and of any Registrar (including, in each case,
reasonable fees and expenses of counsel) incident to the
performance of their respective obligations hereunder will
be paid from time to time upon consultation and agreement
between the Depositary and the Company as to the amount and
nature of such fees, charges and expenses.
ARTICLE VI
AMENDMENT AND TERMINATION
SECTION 6.01. Amendment. The form of the
Receipts and any provisions of this Deposit Agreement may at
any time and from time to time be amended by agreement
between the Company and the Depositary in any respect that
they may deem necessary or desirable. Any amendment that
shall impose any fees, taxes or charges payable by holders
of Receipts (other than taxes and other governmental
charges, fees and other expenses provided for herein or in
the Receipts), or that shall otherwise prejudice any
substantial existing right of holders of Receipts, shall not
become effective as to outstanding Receipts until the
expiration of 90 days after notice of such amendment shall
have been given to the record holders of outstanding
Receipts. Every holder of an outstanding Receipt at the
time any such amendment becomes effective shall be deemed,
by continuing to hold such Receipt, to consent and agree to
such amendment and to be bound by this Deposit Agreement as
amended thereby. In no event shall any amendment impair the
right, subject to the provisions of Sections 2.03, 2.06,
2.07 and 2.10 and Article III, of any owner of any
Depositary Shares to surrender the Receipt evidencing such
Depositary Shares with instructions to the Depositary to
deliver to the holder the Series B Preferred Stock and all
money and other property, if any, represented thereby, or to
cause the conversion of the underlying Series B Preferred
Stock into Common Stock and cash for any fractional share
amount, except in order to comply with mandatory provisions
of applicable law.
SECTION 6.02. Termination. Whenever so directed
by the Company upon at least five Business Days' prior
notice, the Depositary will terminate this Deposit
Agreement, provided, that notice of such termination has
been given by mailing notice of such termination to the
record holders of all Receipts then outstanding at least
30 days prior to the date fixed in such notice for such
termination. The Depositary may likewise terminate this
Deposit Agreement if at any time 45 days shall have expired
after the Depositary shall have delivered to the Company a
written notice of its election to resign and a successor
depositary shall not have been appointed and accepted its
appointment as provided in Section 5.04.
If any Receipts shall remain outstanding after the
date of termination of this Deposit Agreement, the
Depositary thereafter shall discontinue the transfer of
Receipts, shall suspend the distribution of dividends to the
holders thereof and shall not give any further notices
(other than notice of such termination) or perform any
further acts under this Deposit Agreement, except as
hereinafter provided in this paragraph and except that the
Depositary shall continue to collect dividends and other
distributions pertaining to Series B Preferred Stock, shall
sell rights, preferences, privileges or other property as
provided in this Deposit Agreement and shall continue to
deliver the Series B Preferred Stock and any money and other
property represented by Receipts, without liability for
interest thereon, upon surrender thereof by the holders
thereof. At any time after the expiration of two years from
the date of termination, the Depositary may sell Series B
Preferred Stock then held hereunder at public or private
sale, at such place or places and upon such terms as it
deems proper and may thereafter hold the net proceeds of any
such sale, together with any money and other property held
by it hereunder, without liability for interest, for the
benefit, pro rata in accordance with their holdings, of the
holders of Receipts that have not theretofore been
surrendered. After making such sale, the Depositary shall
be discharged from all obligations under this Deposit
Agreement except to account for such net proceeds and money
and other property. Upon the termination of this Deposit
Agreement, the Company shall be discharged from all
obligations under this Deposit Agreement except for its
obligations to the Depositary, any Depositary's Agent and
any Registrar under Sections 5.07 and 5.08. In the event
this Deposit Agreement is terminated and a sufficient number
of shares of Series B Preferred Stock remain outstanding,
the Company hereby agrees to use its best efforts to list
the underlying Series B Preferred Stock on the New York
Stock Exchange, Inc. (unless the holders of a majority of
the outstanding shares of Series B Preferred Stock shall
consent to the Company not effecting such listing).
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. Counterparts. This Deposit
Agreement may be executed by the Company and the Depositary
in separate counterparts, each of which counterpart, when so
executed and delivered, shall be deemed an original, but all
such counterparts taken together shall constitute one and
the same instrument. Delivery of an executed counterpart of
a signature page to this Deposit Agreement by facsimile
transmission shall be effective as delivery of a manually
executed counterpart of this Deposit Agreement. Copies of
this Deposit Agreement shall be filed with the Depositary
and the Depositary's Agents and shall be open to inspection
during business hours at the Corporate Office and the
respective offices of the Depositary's Agents, if any, by
any holder of a Receipt.
SECTION 7.02. Exclusive Benefits of Parties.
This Deposit Agreement is for the exclusive benefit of the
parties hereto, and their respective successors hereunder,
and shall not be deemed to give any legal or equitable
right, remedy or claim to any other person whatsoever.
SECTION 7.03. Invalidity of Provisions. In case
any one or more of the provisions contained in this Deposit
Agreement or in the Receipts should be or become invalid,
illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions
contained herein or therein shall in no way be affected,
prejudiced or disturbed thereby.
SECTION 7.04. Notices. Any notices to be given
to the Company hereunder or under the Receipts shall be in
writing and shall be deemed to have been duly given if
personally delivered or sent by mail or by facsimile
transmission confirmed by letter, addressed to the Company
at 55 East Camperdown Way, Post Office Box 1028, Greenville,
South Carolina 29602, Attention: Treasurer, with a copy to
Corporate Secretary, or at any other place to which the
Company may have transferred its principal executive office.
Any notices to be given to the Depositary
hereunder or under the Receipts shall be in writing and
shall be deemed to have been duly given if personally
delivered or sent by mail, or by telegram or telex or
telecopier confirmed by letter, addressed to the Depositary
at the Corporate Office.
Any notices given to any record holder of a
Receipt hereunder or under the Receipts shall be in writing
and shall be deemed to have been duly given if personally
delivered or sent by mail, or by telegram or telex or
telecopier confirmed by letter, addressed to such record
holder at the most recent address of such record holder as
it appears on the books of the Depositary or, if such holder
shall have timely filed with the Depositary a written
request that notices intended for such holder be mailed to
some other address, at the address designated in such
request.
Delivery of a notice sent by mail, or by telegram
or telex or telecopier, shall be deemed to be effected at
the time when a duly addressed letter containing the same
(or a duly addressed letter confirming an earlier notice in
the case of a facsimile transmission, telegram or telex) is
deposited, postage prepaid, in a post office letter box.
The Depositary or the Company may, however, act upon any
facsimile transmission received by it from the other or from
any holder of a Receipt, notwithstanding that such facsimile
transmission shall not subsequently be confirmed by letter
as aforesaid.
SECTION 7.05. Depositary's Agents. The
Depositary may from time to time appoint Depositary's Agents
to act in any respect for the Depositary for the purposes of
this Deposit Agreement and may at any time appoint
additional Depositary's Agents and vary or terminate the
appointment of such Depositary's Agents. The Depositary
will notify the Company of any such action.
SECTION 7.06. Holders of Receipts Are Parties.
Notwithstanding that holders of Receipts have not executed
and delivered this Deposit Agreement or any counterpart
thereof, the holders of Receipts from time to time shall be
deemed to be parties to this Deposit Agreement and shall be
bound by all of the terms and conditions hereof and of the
Receipts by acceptance of delivery of Receipts.
SECTION 7.07. Governing Law. This Deposit
Agreement and the Receipts and all rights hereunder and
thereunder and provisions hereof and thereof shall be
governed by, and construed in accordance with, the law of
the State of New York without giving effect to principles of
conflict of laws.
SECTION 7.08. Headings. The headings of articles
and sections in this Deposit Agreement and in the form of
the Receipt set forth in Exhibit A hereto have been inserted
for convenience only and are not to be regarded as a part of
this Deposit Agreement or the Receipts or to have any
bearing upon the meaning or interpretation of any provision
contained herein or in the Receipts.
IN WITNESS WHEREOF, Bowater Incorporated and Trust
Company Bank have duly executed this agreement as of the day
and year first above set forth and all holders of Receipts
shall become parties hereto by and upon acceptance by them
of delivery of Receipts executed and delivered in accordance
with the terms hereof.
BOWATER INCORPORATED,
By /s/ David G. Maffucci
_________________________
Name: David G. Maffucci
Title: Vice President -
Treasurer
TRUST COMPANY BANK,
as Depositary,
By /s/ T.J. Donaldson
________________________
Name: T.J. Donaldson
Title: Group Vice President
EXHIBIT A
DEPOSITARY RECEIPT
FOR
DEPOSITARY SHARES,
EACH REPRESENTING ONE-FOURTH OF A SHARE OF
7% PRIDES, SERIES B CONVERTIBLE PREFERRED STOCK,
par value $1 per share
OF
BOWATER INCORPORATED
(Incorporated under the Laws of the State of Delaware)
No. Depositary Shares
CUSIP
Trust Company Bank, as Depositary (the
"Depositary"), hereby certifies that ___________________ is
the registered owner of __________ Depositary Shares (the
"Depositary Shares"), each Depositary Share representing
one-fourth of a share of 7% PRIDES, Series B Convertible
Preferred Stock, par value $1 per share (the "Series B
Preferred Stock"), of Bowater Incorporated, a corporation
duly organized and existing under the laws of the State of
Delaware (the "Company"), and the same proportionate
interest in any and all other property received by the
Depositary in respect of such shares of Series B Preferred
Stock and held by the Depositary under the Deposit Agreement
(as defined below). Subject to the terms of the Deposit
Agreement, each owner of a Depositary Share is entitled,
proportionately, to all the rights, preferences and
privileges of the Series B Preferred Stock represented
thereby, including the dividend, voting, conversion,
liquidation and other rights contained in the Certificate of
Designations of the 7% PRIDES, Series B Convertible
Preferred Stock, par value $1 per share, establishing the
rights, preferences, privileges and limitations of the
Series B Preferred Stock (the "Certificate of
Designations"), copies of which are on file at the office of
the Depositary at which at any particular time its business
in respect of matters governed by the Deposit Agreement
shall be administered, which at the time of the execution of
the Deposit Agreement is located at One Park Place, Atlanta,
Georgia (the "Corporate Office").
THE DEPOSITARY IS NOT RESPONSIBLE FOR THE VALIDITY OF ANY
DEPOSITED STOCK. THE DEPOSITARY ASSUMES NO RESPONSIBILITY
FOR THE CORRECTNESS OF THE DESCRIPTION SET FORTH IN THIS
RECEIPT, WHICH CAN BE TAKEN AS A STATEMENT OF THE COMPANY
SUMMARIZING CERTAIN PROVISIONS OF THE DEPOSIT AGREEMENT.
UNLESS EXPRESSLY SET FORTH IN THE DEPOSIT AGREEMENT, THE
DEPOSITARY MAKES NO WARRANTIES OR REPRESENTATIONS AS TO THE
VALIDITY, GENUINENESS OR SUFFICIENCY OF ANY STOCK AT ANY
TIME DEPOSITED WITH THE DEPOSITARY UNDER THE DEPOSIT
AGREEMENT OR OF THE DEPOSITARY SHARES OR RECEIPTS (EXCEPT
FOR ITS COUNTERSIGNATURES THEREON), AS TO THE VALIDITY OR
SUFFICIENCY OF THE DEPOSIT AGREEMENT, AS TO THE VALUE OF THE
DEPOSITARY SHARES OR AS TO ANY RIGHT, TITLE OR INTEREST OF
THE RECORD HOLDERS OF THE RECEIPTS IN AND TO THE DEPOSITARY
SHARES.
The Company will furnish to any holder of a
Receipt without charge, upon request addressed to its
executive office or the office of its transfer agent, a
statement or summary of the powers, designations,
preferences and relative, participating, optional or other
special rights of each authorized class of capital stock of
the Company, and of each series of preferred stock of the
Company authorized to be issued, so far as the same may have
been fixed, and of the qualifications, limitations or
restrictions of such preferences and/or rights.
This Depositary Receipt (the "Receipt") is
continued on the reverse hereof and the additional
provisions therein set forth for all purposes have the same
effect as if set forth at this place.
This Receipt shall not be entitled to any benefits
under the Deposit Agreement or be valid or obligatory for
any purpose, unless this Receipt shall have been executed on
behalf of the Company by the manual or facsimile signature
of a duly authorized officer and executed manually or, if a
Registrar for the Receipts (other than the Depositary) shall
have been appointed, by facsimile by the Depositary by the
signature of a duly authorized officer and, if executed by
facsimile signature of the Depositary, shall have been
countersigned manually by such Registrar by the signature of
a duly authorized officer.
Dated:
TRUST COMPANY BANK
Depositary and Registrar
By
------------------------
Authorized Officer
BOWATER INCORPORATED
By
------------------------
Authorized Officer
[FORM OF REVERSE
OF DEPOSITARY RECEIPT]
1. The Deposit Agreement. Depositary Receipts
(the "Receipts"), of which this Receipt is one, are made
available upon the terms and conditions set forth in the
Deposit Agreement, dated as of February 1, 1994 (the
"Deposit Agreement") among the Company, the Depositary and
all holders from time to time of Receipts. The Deposit
Agreement (copies of which are on file at the Corporate
Office and at the office of any Agent of the Depositary)
sets forth the rights of holders of Receipts and the rights
and duties of the Depositary. The statements made on the
face and the reverse of this Receipt are summaries of
certain provisions of the Deposit Agreement and are subject
to the detailed provisions thereof, to which reference is
hereby made. In the event of any conflict between the
provisions of this Receipt and the provisions of the Deposit
Agreement, the provisions of the Deposit Agreement will
govern.
2. Definitions. Unless otherwise expressly
herein provided, all defined terms used herein shall have
the meanings ascribed thereto in the Deposit Agreement.
3. Redemption of Series B Preferred Stock.
Whenever the Company shall elect to redeem shares of Series
B Preferred Stock for shares of its Common Stock, par value
$1.00 per share ("Common Stock"), in accordance with the
Certificate of Designations, it shall (unless otherwise
agreed in writing with the Depositary) give the Depositary
in its capacity as Depositary the notice required by the
Deposit Agreement. The Depositary shall mail, first class
postage prepaid, notice of such redemption and the proposed
simultaneous redemption of the number of Depositary Shares
representing the Series B Preferred Stock to be redeemed,
not less than 15 and not more than 60 days prior to the date
fixed for redemption of such Series B Preferred Stock and
Depositary Shares (the "Redemption Date"), to the record
holders of the Receipts evidencing the Depositary Shares to
be so redeemed, at the addresses of such holders as they
appear on the records of the Depositary; but neither failure
to mail any such notice to one or more such holders nor any
defect in any notice to one or more such holders shall
affect the sufficiency of the proceedings for redemption as
to other holders. Each such notice shall state: (i) the
Redemption Date; (ii) the number of Depositary Shares to be
redeemed and, if less than all the Depositary Shares held by
any such holder are to be redeemed, the number of such
Depositary Shares held by such holder to be so redeemed;
(iii) the number of shares of Common Stock deliverable upon
redemption; (iv) the call price for the Depositary Shares;
(v) the Optional Conversion Rate (calculated in accordance
with paragraph 3 of the Certificate of Designations),
together with a statement that all conversion rights with
respect to the Depositary Shares called for redemption will
terminate immediately prior to the close of business on the
date fixed for redemption; (vi) the place or places where
Receipts evidencing Depositary Shares are to be surrendered
for payment of the redemption price; and (vii) that
dividends in respect of the shares of Series B Preferred
Stock represented by the Depositary Shares to be redeemed
will cease to accumulate on such Redemption Date. Any such
notices shall be mailed in the same manner as notices of
redemption of the Series B Preferred Stock are required to
be mailed pursuant to paragraph 3 of the Certificate of
Designations and published in the same manner as notices of
redemption of the Series B Preferred Stock are required to
be published pursuant to said paragraph, if so required. In
case fewer than all the outstanding Depositary Shares are to
be redeemed, the Depositary Shares to be redeemed shall be
selected by lot or pro rata (as nearly as may be) or by any
other equitable method determined by the Depositary to be
consistent with the method determined by the Board of
Directors of the Company with respect to the Series B
Preferred Stock.
Notice having been mailed and published by the
Depositary as aforesaid, from and after the Redemption Date
(unless the Company shall have failed to redeem the shares
of Series B Preferred Stock to be redeemed by it, as set
forth in the Company's notice provided for above), the
Depositary Shares called for redemption shall be deemed no
longer to be outstanding and all rights of the holders of
Receipts evidencing such Depositary Shares (except the right
to receive the shares of Common Stock upon redemption and
cash for any fractional share amount) shall, to the extent
of such Depositary Shares, cease and terminate. Upon
surrender in accordance with said notice of the Receipts
evidencing such Depositary Shares (properly endorsed or
assigned for transfer, if the Depositary shall so require),
such Depositary Shares shall be redeemed for shares of
Common Stock and cash for any fractional share amount at a
rate per Depositary Share equal to one-fourth of the number
of shares of Common Stock (including fractional amounts)
delivered upon redemption of a share of Series B Preferred
Stock pursuant to the Certificate of Designations. The
foregoing shall be subject further to the terms and
conditions of the Certificate of Designations and the
Deposit Agreement.
If fewer than all of the Depositary Shares
evidenced by this Receipt are called for redemption, the
Depositary will deliver to the holder of this Receipt upon
its surrender to the Depositary, together with shares of
Common Stock for the Depositary Shares called for
redemption, a new Receipt evidencing the Depositary Shares
evidenced by such prior Receipt and not called for
redemption.
In the event that Depositary Shares are redeemed
for shares of Common Stock and certificates evidencing
Rights are issued or to be issued in connection therewith,
such certificates shall be distributed in the same manner
and to the same record holders receiving the shares of
Common Stock associated with such Rights.
4. Surrender of Receipts and Withdrawal of Series
B Preferred Stock. Upon surrender of this Receipt to the
Depositary at the Corporate Office or such other offices as
the Depositary may designate, and subject to the provisions
of the Deposit Agreement, the holder hereof is entitled to
withdraw, and to obtain delivery of, to or upon the order of
such holder, any or all of the Series B Preferred Stock (but
only in whole shares of Series B Preferred Stock) and any or
all money and other property, if any, at the time
represented by the Depositary Shares evidenced by this
Receipt; provided, however, that, in the event this Receipt
shall evidence a number of Depositary Shares in excess of
the number of Depositary Shares representing the whole
number of shares of Series B Preferred Stock to be
withdrawn, the Depositary shall, in addition to such whole
number of shares of Series B Preferred Stock and such money
and other property, if any, to be withdrawn, deliver, to or
upon the order of such holder, a new Receipt or Receipts
evidencing such excess number of whole Depositary Shares.
5. Optional Conversion of Series B Preferred
Stock into Common Stock. Subject to the terms and
conditions of the Deposit Agreement and the Certificate of
Designations, this Receipt may be surrendered with written
instructions to the Depositary to instruct the Company to
cause the conversion of any specified number of whole shares
of Series B Preferred Stock represented by whole Depositary
Shares evidenced hereby into whole shares of Common Stock
and cash for any fractional share amount at the conversion
price then in effect for the Series B Preferred Stock
pursuant to the Certificate of Designations as such
conversion price may be adjusted by the Company from time to
time as provided in the Certificate of Designations.
Subject to the terms and conditions of the Deposit Agreement
and the Certificate of Designations, a holder of a Receipt
or Receipts evidencing Depositary Shares representing whole
or fractional shares of Series B Preferred Stock may
surrender such Receipt or Receipts at the Depositary's
Office or at such office or to such Depositary's Agents as
the Depositary may designate for such purpose, together with
a notice of conversion duly completed and executed, thereby
directing the Depositary to instruct the Company to cause
the conversion of the number of whole shares of underlying
Series B Preferred Stock specified in such notice of
conversion into shares of Common Stock, and an assignment of
such Receipt or Receipts to the Company or in blank, duly
completed and executed. To the extent that a holder
delivers to the Depositary for conversion a Receipt or
Receipts which in the aggregate are convertible into less
than one whole share of Common Stock, the holder shall
receive payment in cash in lieu of such fractional share of
Common Stock otherwise issuable. If more than one Receipt
shall be delivered for conversion at one time by the same
holder, the number of whole shares of Common Stock issuable
upon conversion thereof shall be computed on the basis of
the aggregate number of Depositary Shares represented by the
Receipts so delivered.
If Series B Preferred Stock shall be called by the
Company for redemption, the Depositary Shares representing
such Series B Preferred Stock may be converted into Common
Stock as provided in the Deposit Agreement until, but not
after, the close of business on the Redemption Date unless
the Company shall fail to deposit with the Depositary the
shares of Common Stock and cash for any fractional share
amounts required to redeem the Series B Preferred Stock, in
which case the Depositary Shares representing such Series B
Preferred Stock may continue to be converted into Common
Stock until, but not after, the close of business on the
date on which the Company deposits with the Depositary such
shares of Common Stock and cash for any fractional share
amounts as are required by the Certificate of Designations
to make full payment of the amounts payable upon such
redemption. Upon receipt by the Depositary of a Receipt or
Receipts, together with a properly completed and executed
notice of conversion, representing any Series B Preferred
Stock called for redemption, the shares of Series B
Preferred Stock held by the Depositary represented by such
Depositary Shares for which conversion is requested shall be
deemed to have been received by the Company for conversion
as of immediately prior to the close of business on the date
of such receipt by the Depositary.
6. Mandatory Conversion of Series B Preferred
Stock into Common Stock. With respect to any Series B
Preferred Stock on deposit with the Depositary as to which
the Company has not exercised its right to redeem and the
record holder has not exercised its right of optional
conversion pursuant to the Certificate of Designations, the
Depositary shall mail, first class postage prepaid, notice
of the mandatory conversion of Series B Preferred Stock and
the simultaneous mandatory conversion of the Depositary
Shares representing the Series B Preferred Stock to be
mandatorily converted, not less than 5 and not more than
15 days prior to the date fixed for mandatory conversion of
such Series B Preferred Stock and Depositary Shares (the
"Mandatory Conversion Date"), to all record holders of
Receipts evidencing Depositary Shares who are of record on
the date that is two Business Days prior to the date of
mailing, at the addresses of such holders as they appear on
the records of the Depositary; but neither failure to mail
any such notice to one or more such holders nor any defect
in any notice to one or more such holders shall affect the
sufficiency of the proceedings for mandatory conversion as
to any record holder (whether or not such failure or defect
affects such record holder). Each such notice shall
state: (i) the Mandatory Conversion Date; (ii) that all
outstanding Depositary Shares on the Mandatory Conversion
Date will be mandatorily converted pursuant to the
Certificate of Designations and the Deposit Agreement; (iii)
the Common Equivalent Rate (determined in accordance with
paragraph 3 of the Certificate of Designations); (iv) the
place or places where Receipts evidencing Depositary Shares
are to be surrendered for payment of the mandatory
conversion price; and (v) that dividends in respect of the
shares of Series B Preferred Stock represented by the
Depositary Shares to be mandatorily converted will cease to
accumulate on the Mandatory Conversion Date.
On the Mandatory Conversion Date, all then
outstanding shares of Series B Preferred Stock shall
mandatorily convert into shares of Common Stock, cash for
any fractional share amounts and the right to receive
amounts in cash equal to all accrued and unpaid dividends on
such shares of Series B Preferred Stock to the Mandatory
Conversion Date (other than previously declared dividends
payable to a holder of record as of a prior date), all as
provided in and subject to paragraph 3 of the Certificate of
Designations.
From and after the Mandatory Conversion Date, the
Depositary Shares representing the shares of Series B
Preferred Stock mandatorily converted shall be deemed no
longer to be outstanding and all rights of the record
holders of Receipts evidencing such Depositary Shares
(except the right to receive the shares of Common Stock, any
cash for accrued and unpaid dividends (other than previously
declared dividends payable to a holder of record as of a
prior date) and any fractional share amount deliverable or
payable upon mandatory conversion or in connection
therewith) shall, to the extent of such Depositary Shares,
cease and terminate. Upon surrender, in accordance with
said notice, of the Receipts evidencing such Depositary
Shares (properly endorsed or assigned for transfer, if the
Depositary shall so require), such Depositary Shares shall
be exchanged for shares of Common Stock and cash for any
fractional share amount (and the right to receive cash for
any accrued and unpaid dividends payable in connection
therewith) at a rate per Depositary Share equal to one-
fourth of the number (including fractional amounts) of
shares of Common Stock (and one-fourth of the right to
receive cash for any accrued and unpaid dividends) exchanged
for each share of Series B Preferred Stock pursuant to the
Certificate of Designations. The foregoing shall be subject
further to the terms and conditions of the Certificate of
Designations and the Deposit Agreement.
On or prior to the Mandatory Conversion Date, the
Company shall deposit with the Depositary certificates for
the shares of Common Stock and the cash for any fractional
share amounts into which the shares of Series B Preferred
Stock held by the Depositary shall mandatorily convert on
the Mandatory Conversion Date, plus, subject to the
Certificate of Designations, an amount in cash equal to all
accrued and unpaid dividends on such shares of Series B
Preferred Stock (other than previously declared dividends
payable to a holder of record as of a prior date) to the
Mandatory Conversion Date. Using such shares of Common
Stock and cash, the Depositary shall deliver certificates
for the appropriate number of shares of Common Stock and the
appropriate amount of cash, without interest, to record
holders who properly deliver their Receipts to the
Depositary.
7. Transfers, Split-ups, Combinations. Subject
to Paragraphs 8, 9 and 10 below, this Receipt is
transferable on the books of the Depositary upon surrender
of this Receipt to the Depositary at the Corporate Office or
such other offices as the Depositary may designate, properly
endorsed or accompanied by a properly executed instrument of
transfer or endorsement, and upon such transfer the
Depositary shall sign and deliver a Receipt to or upon the
order of the person entitled thereto, all as provided in and
subject to the Deposit Agreement. This Receipt may be split
into other Receipts or combined with other Receipts into one
Receipt evidencing the same aggregate number of Depositary
Shares evidenced by the Receipt or Receipts surrendered;
provided, however, that the Depositary shall not execute and
deliver any Receipt evidencing a fractional Depositary
Share.
8. Conditions to Signing and Delivery, Transfer,
etc., of Receipts. Prior to the execution and delivery,
transfer, split-up, combination, surrender or exchange of
this Receipt, the Depositary, any of the Depositary's Agents
or the Company may require any or all of the following:
(i) payment to it of a sum sufficient for the payment (or,
in the event that the Depositary or the Company shall have
made such payment, the reimbursement to it) of any tax or
other governmental charge with respect thereto (including
any such tax or charge with respect to Series B Preferred
Stock being deposited or withdrawn or with respect to Common
Stock, Rights or other securities or property of the Company
being issued upon conversion or redemption); (ii) the
production of proof satisfactory to it as to the identity
and genuineness of any signature; and (iii) compliance with
such regulations, if any, as the Depositary or the Company
may establish not inconsistent with the Deposit Agreement.
Any person presenting Series B Preferred Stock for deposit,
or any holder of this Receipt, may be required to file such
proof of information, to execute such certificates and to
make such representations and warranties as the Depositary
or the Company may reasonably deem necessary or proper. The
Depositary or the Company may withhold or delay the delivery
of any Receipt, the transfer, redemption, conversion or
exchange of any Receipt, the withdrawal of the Series B
Preferred Stock or money or other property, if any,
represented by the Depositary Shares evidenced by this
Receipt or the distribution of any dividend or other
distribution until such proof or other information is filed,
such certificates are executed or such representations and
warranties are made.
9. Suspension of Delivery, Transfer, etc. The
deposit of Series B Preferred Stock may be refused, the
delivery of this Receipt against Series B Preferred Stock
may be suspended, and the transfer, split-up, combination,
surrender or exchange of this Receipt may be suspended
(i) during any period when the register of holders of
Receipts is closed, (ii) if any such action is deemed
necessary or advisable by the Depositary, any of the
Depositary's Agents or the Company at any time or from time
to time because of any requirement of law or of any
government or governmental body or commission, or under any
provision of the Deposit Agreement, or (iii) with the
approval of the Company, for any other reason. Except with
respect to a conversion of Depositary Shares which may occur
pursuant to paragraph 3 of the Certificate of Designations,
the Depositary shall not be required (a) to execute and
deliver, transfer or exchange any Receipts for a period
beginning at the opening of business 15 days next preceding
any selection of Depositary Shares and Series B Preferred
Stock to be redeemed and ending at the close of business on
the day of the mailing of notice of redemption of Depositary
Shares or (b) to transfer or exchange for another Receipt
any Receipt evidencing Depositary Shares called or being
called for redemption in whole or in part, except as
provided in the second to last paragraph of Paragraph 3
above.
10. Payment of Taxes or Other Governmental
Charges. If any tax or other governmental charge shall
become payable by or on behalf of the Depositary with
respect to this Receipt, the Depositary Shares evidenced by
this Receipt, the Series B Preferred Stock (or any
fractional interest therein) represented by such Depositary
Shares or any transaction referred to in Section 4.06 of the
Deposit Agreement, such tax (including transfer, issuance or
acquisition taxes, if any) or governmental charge shall be
payable by the holder hereof. Until such payment is made,
transfer, redemption, conversion or exchange of this Receipt
or any withdrawal of the Series B Preferred Stock or money
and other property, if any, represented by the Depositary
Shares evidenced by this Receipt may be refused, any
dividend or other distribution may be withheld and any part
or all of the Series B Preferred Stock or other property
represented by the Depositary Shares evidenced by this
Receipt may be sold for the account of the holder hereof
(after attempting by reasonable means to notify such holder
prior to such sale). Any dividend or other distribution so
withheld and the proceeds of any such sale may be applied to
any payment of such tax or other governmental charge, the
holder of this Receipt remaining liable for any deficiency.
11. Amendment. The form of the Receipts and any
provision of the Deposit Agreement may at any time and from
time to time be amended by agreement between the Company and
the Depositary in any respect that they may deem necessary
or desirable. Any amendment that shall impose any fees,
taxes or charges payable by holders of Receipts (other than
taxes and other governmental charges, fees and other
expenses provided for herein or in the Deposit Agreement),
or that shall otherwise prejudice any substantial existing
right of holders of Receipts, shall not become effective as
to outstanding Receipts until the expiration of 90 days
after notice of such amendment shall have been given to the
record holders of outstanding Receipts. The holder of this
Receipt at the time any such amendment becomes effective
shall be deemed, by continuing to hold this Receipt, to
consent and agree to such amendment and to be bound by the
Deposit Agreement as amended thereby. In no event shall any
amendment impair the right, subject to the provisions of
Paragraphs 3, 4, 5, 6, 8, 9 and 10 hereof and of
Sections 2.03, 2.06, 2.07, 2.10 and 2.11 and Article III of
the Deposit Agreement, of the owner of the Depositary Shares
evidenced by this Receipt to surrender this Receipt with
instructions to the Depositary to deliver to the holder the
Series B Preferred Stock and all money and other property,
if any, represented hereby, or to cause the conversion of
the underlying Series B Preferred Stock into Common Stock
and cash for any fractional share amount, except in order to
comply with mandatory provisions of applicable law.
12. Fees, Charges and Expenses. The Company will
pay all fees, charges and expenses of the Depositary, except
for taxes (including transfer taxes, if any) and other
governmental charges and such charges as are expressly
provided in the Deposit Agreement to be at the expense of
persons depositing Series B Preferred Stock, holders of
Receipts or other persons.
13. Title to Receipts. It is a condition of this
Receipt, and every successive holder hereof by accepting or
holding the same consents and agrees, that title to this
Receipt (and to the Depositary Shares evidenced hereby) when
properly endorsed or accompanied by a properly executed
instrument of transfer or endorsement, is transferable by
delivery; provided, however, that until this Receipt shall
be transferred on the books of the Depositary as provided in
Section 2.04 of the Deposit Agreement, the Depositary may,
notwithstanding any notice to the contrary, treat the record
holder hereof at such time as the absolute owner hereof for
the purpose of determining the person entitled to
distribution of dividends or other distributions or to any
notice provided for in the Deposit Agreement and for all
other purposes.
14. Dividends and Distributions. Whenever the
Depositary receives any cash dividend or other cash
distribution on the Series B Preferred Stock, the Depositary
will, subject to the provisions of the Deposit Agreement,
distribute such portions of such sum to record holders of
Receipts as are, as nearly as practicable, proportionate to
the respective numbers of Depositary Shares evidenced by the
Receipts held by such holders; provided, however, that in
case the Company or the Depositary shall be required to
withhold and does withhold from any cash dividend or other
cash distribution in respect of the Series B Preferred Stock
an amount on account of taxes or as otherwise required by
law, regulation or court order, the amount made available
for distribution or distributed in respect of Depositary
Shares shall be reduced accordingly. The Depositary shall
distribute or make available for distribution, as the case
may be, only such amount, however, as can be distributed
without attributing to any owner of Depositary Shares a
fraction of one cent and any balance not so distributable
shall be held by the Depositary (without liability for
interest thereon) and shall be added to and be treated as
part of the next sum received by the Depositary for
distribution to record holders of Receipts then outstanding.
15. Subscription Rights, Preferences or
Privileges. If the Company shall at any time offer or cause
to be offered to the persons in whose names Series B
Preferred Stock is registered on the books of the Company
any rights, preferences or privileges to subscribe for or to
purchase any securities or any rights, preferences or
privileges of any other nature, such rights, preferences or
privileges shall in each such instance, subject to the
provisions of the Deposit Agreement, be made available by
the Depositary to the record holders of Receipts if the
Company so directs in such manner as the Company shall
instruct.
16. Notice of Dividends, Fixing of Record Date.
Whenever any cash dividend or other cash distribution shall
become payable, any distribution other than cash shall be
made, or any rights, preferences or privileges shall at any
time be offered, with respect to the Series B Preferred
Stock, or the Depositary shall receive notice of (i) any
meeting at which holders of Series B Preferred Stock are
entitled to vote or of which holders of Series B Preferred
Stock are entitled to notice or (ii) any election on the
part of the Company to call for redemption any shares of
Series B Preferred Stock, the Depositary shall in each such
instance fix a record date (which shall be the same date as
the record date fixed by the Company with respect to the
Series B Preferred Stock) for the determination of the
holders of Receipts (i) who shall be entitled to receive
such dividend, distribution, rights, preferences or
privileges or the net proceeds of the sale thereof, or to
give instructions for the exercise of voting rights at any
such meeting or to receive notice of such meeting or
(ii) whose Depositary Shares are to be so redeemed.
17. Voting Rights. Upon issuance of notice of any
meeting at which the holders of Series B Preferred Stock are
entitled to vote, the Company shall direct the Depositary,
as soon as practicable thereafter, to mail to the record
holders of Receipts a notice, which shall contain (i) such
information as is contained in such notice of meeting,
(ii) a statement that the holders of Receipts at the close
of business on a specified record date determined as
provided in Paragraph 16 will be entitled, subject to any
applicable provision of law, the Certificate of
Incorporation or the Certificate of Designations, to
instruct the Depositary as to the exercise of the voting
rights pertaining to the amount of Series B Preferred Stock
represented by their respective Depositary Shares, and
(iii) a brief statement as to the manner in which such
instructions may be given. Upon the written request of a
holder of a Receipt on such record date, the Depositary
shall endeavor insofar as practicable to vote or cause to be
voted the amount of Series B Preferred Stock represented by
the Depositary Shares evidenced by such Receipt in
accordance with the instructions set forth in such request.
The Company has agreed to take all reasonable action that
may be deemed necessary by the Depositary in order to enable
the Depositary to vote such Series B Preferred Stock or
cause such Series B Preferred Stock to be voted. In the
absence of specific instructions from the holder of a
Receipt, the Depositary will abstain from voting to the
extent of the Series B Preferred Stock represented by the
Depositary Shares evidenced by such Receipt. After
aggregating all voting Depositary Shares, the Depositary
will disregard for voting purposes any fractional share of
Series B Preferred Stock remaining.
18. Reports, Inspection of Transfer Books. The
Depositary shall make available for inspection by holders of
Receipts at the Corporate Office and at such other places as
it may from time to time deem advisable during normal
business hours any reports and communications received from
the Company that are both received by the Depositary as the
holder of Series B Preferred Stock and made generally
available to the holders of Series B Preferred Stock by the
Company. The Depositary shall keep books at the Corporate
Office for the registration and transfer of Receipts, which
books during normal business hours will be open for
inspection by the record holders of Receipts as provided by
applicable law.
19. Liability of the Depositary, the Depositary's
Agents and the Company. Neither the Depositary nor any
Depositary's Agent nor the Company shall incur any liability
to any holder of any Receipt, if by reason of any provision
of any present or future law or regulation of any
governmental authority or, in the case of the Depositary or
the Depositary's Agent, by reason of any provision, present
or future, of the Certificate of Incorporation or the
Certificate of Designations or, in the case of the Company,
the Depositary or the Depositary's Agent, by reason of any
act of God or war or other circumstance beyond the control
of the relevant party, the Depositary, any Depositary's
Agent or the Company shall be prevented or forbidden from
doing or performing any act or thing that the terms of the
Deposit Agreement provide shall be done or performed; nor
shall the Depositary, any Depositary's Agent or the Company
incur any liability to any holder of a Receipt by reason of
any nonperformance or delay, caused as aforesaid, in the
performance of any act or thing that the terms of the
Deposit Agreement provide shall or may be done or performed
or by reason of any exercise of, or failure to exercise, any
discretion provided for in the Deposit Agreement.
20. Obligations of the Depositary, the
Depositary's Agents and the Company. Neither the Depositary
nor any Depositary's Agent nor the Company assumes any
obligation or shall be subject to any liability hereunder or
under the Deposit Agreement to holders of Receipts other
than that each of them agrees to use good faith in the
performance of such duties as are specifically set forth in
the Deposit Agreement.
Neither the Depositary nor any Depositary's Agent
nor the Company shall be under any obligation to appear in,
prosecute or defend any action, suit or other proceeding
with respect to Series B Preferred Stock, Depositary Shares,
Receipts or Common Stock that in its opinion may involve it
in expense or liability, unless indemnity satisfactory to it
against all expense and liability be furnished as often as
may be required.
Neither the Depositary nor any Depositary's Agent
nor the Company will be liable for any action or failure to
act by it in reliance upon the advice of or information from
legal counsel, accountants, any person presenting Series B
Preferred Stock for deposit, any holder of a Receipt or any
other person believed by it in good faith to be competent to
give such advice or information.
21. Termination of Deposit Agreement. Whenever so
directed by the Company upon at least five Business Days'
prior notice, the Depositary will terminate the Deposit
Agreement, provided, that notice of such termination has
been given by mailing notice of such termination to the
record holders of all Receipts then outstanding at least
30 days prior to the date fixed in such notice for such
termination. The Depositary may likewise terminate the
Deposit Agreement if at any time 45 days shall have expired
after the Depositary shall have delivered to the Company a
written notice of its election to resign and a successor
depositary shall not have been appointed and accepted its
appointment as provided in Section 5.04 of the Deposit
Agreement. Upon the termination of the Deposit Agreement,
the Company shall be discharged from all obligations
thereunder except for its obligations to the Depositary, any
Depositary's Agent and any Registrar under Sections 5.07 and
5.08 of the Deposit Agreement.
If any Receipts remain outstanding after the date
of termination, the Depositary thereafter shall discontinue
all functions and be discharged from all obligations as
provided in the Deposit Agreement, except as specifically
provided therein.
22. Governing Law. The Deposit Agreement and this
Receipt and all rights thereunder and hereunder and
provisions thereof and hereof shall be governed by, and
construed in accordance with, the law of the State of New
York without giving effect to principles of conflict of
laws.
NOTICE OF CONVERSION
The undersigned holder of this Receipt for
Depositary Shares hereby irrevocably exercises the option to
convert that number of whole shares of 7% PRIDES, Series B
Convertible Preferred Stock of the Company represented by [
] Depositary Shares into shares of Common Stock of the
Company and cash for any fractional share amount in
accordance with the terms of and subject to the conditions
of the Series B Preferred Stock, including the Certificate
of Designations in respect thereof, and the Deposit
Agreement, and directs the Depositary to instruct the
Company that the shares of Common Stock deliverable upon
such conversion be registered in the name of, and delivered
together with a check in payment for any fractional shares
of Common Stock to, the undersigned unless a different name
has been indicated below. If the shares of Common Stock are
to be registered in the name of a person other than the
undersigned, the undersigned will pay all transfer and
similar taxes payable with respect thereto. If the number
of whole shares of Series B Preferred Stock represented by
the number of Depositary Shares set forth above is less than
the number of shares of Series B Preferred Stock on deposit
in respect of this Receipt, the undersigned directs that the
Depositary execute and deliver to the undersigned, unless a
different name is indicated below, a new Receipt evidencing
Depositary Shares for the balance of such Series B Preferred
Stock not to be converted.
Dated: _________________________
Signature: _________________
NOTE: The signature on this notice of conversion
must correspond with the name as written upon the
face of this Receipt in every particular without
alteration or enlargement or any change
whatsoever, and must be guaranteed by a commercial
bank, trust company, securities broker or dealer,
credit union, savings association or other
eligible guarantor institution which is a member
of or participant in a signature guarantee program
acceptable to the Depositary.
Name: ______________________________________________________
Address: ___________________________________________________
(Please print names and address of Registered Holder)
Name: ______________________________________________________
Address: ___________________________________________________
(Please indicate other delivery instructions, if applicable)
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells,
assigns and transfers unto ____________ the within Receipt
and all rights and interests represented by the Depositary
Shares evidenced thereby, and hereby irrevocably constitutes
and appoints ________________ his attorney, to transfer the
same on the books of the within-named Depositary, with full
power of substitution in the premises.
Dated: Signature: __________________________
NOTE: The signature on this assignment must correspond
with the name as written upon the face of the Receipt in
every particular, without alteration or enlargement, or
any change whatsoever, and must be guaranteed by a
commercial bank, trust company, securities broker or
dealer, credit union, savings association or other
eligible guarantor institution which is a member of or
participant in a signature guarantee program acceptable to
the Depositary.
CONFORMED COPY
BOWATER INCORPORATED
TRUST COMPANY BANK, as Depositary
and
THE HOLDERS FROM TIME TO TIME OF
THE DEPOSITARY RECEIPTS DESCRIBED HEREIN
IN RESPECT OF THE
8.40% SERIES C CUMULATIVE PREFERRED STOCK
_______
Deposit Agreement
_______
Dated as of February 1, 1994
TABLE OF CONTENTS
Page
PARTIES 1
RECITALS 1
ARTICLE I
DEFINITIONS
Business Day 1
Certificate of Designations 2
Certificate of Incorporation 2
Common Stock 2
Company 2
Corporate Office 2
Deposit Agreement 2
Depositary 2
Depositary Share 2
Depositary's Agent 2
Receipt 3
record holder 3
Registrar 3
Securities Act 3
Series C Preferred Stock 3
ARTICLE II
FORM OF RECEIPTS, DEPOSIT OF SERIES C PREFERRED STOCK,
EXECUTION AND DELIVERY, TRANSFER,
SURRENDER AND REDEMPTION OF RECEIPTS
SECTION 2.01. Form and Transferability
of Receipts 3
SECTION 2.02. Deposit of Series C Preferred Stock;
Execution and Delivery of Receipts
in Respect Thereof 5
SECTION 2.03. Redemption of Series C Preferred Stock for
Cash 6
SECTION 2.04. Transfer of Receipts 8
SECTION 2.05. Combination and Split-ups of Receipts 9
SECTION 2.06. Surrender of Receipts and Withdrawal
of Series C Preferred Stock 9
SECTION 2.07 Limitations on Execution and Delivery,
Transfer, Split-up, Combination,
Surrender and Exchange of Receipts 10
SECTION 2.08. Lost Receipts, etc. 11
SECTION 2.09. Cancellation and Destruction of
Surrendered Receipts 11
ARTICLE III
CERTAIN OBLIGATIONS OF HOLDERS
OF RECEIPTS AND THE COMPANY
SECTION 3.01. Filing Proofs, Certificates and Other
Information 11
SECTION 3.02. Payment of Taxes or Other Governmental
Charges 12
SECTION 3.03. Representations and Warranties as to
Series C Preferred Stock 13
ARTICLE IV
THE SERIES C PREFERRED STOCK, NOTICES
SECTION 4.01. Cash Distributions 13
SECTION 4.02. Distributions Other Than Cash 13
SECTION 4.03. Subscription Rights, Preferences or
Privileges 14
SECTION 4.04. Notice of Dividends, Fixing of Record
Date for Holders of Receipts 15
SECTION 4.05. Voting Rights 16
SECTION 4.06. Changes Affecting Series C Preferred Stock
and Reclassifications, Recapitalizations,
etc. 17
SECTION 4.07. Inspection of Reports 17
SECTION 4.08. List of Receipt Holders 17
ARTICLE V
THE DEPOSITARY AND THE COMPANY
SECTION 5.01. Maintenance of Offices, Agencies,
Transfer Books by the Depositary, the
Registrar 17
SECTION 5.02. Prevention of or Delay in Performance
by the Depositary, the Depositary's
Agents or the Company 18
SECTION 5.03. Obligations of the Depositary, the
Depositary's Agents and the Company 19
SECTION 5.04. Resignation and Removal of the
Depositary; Appointment of Successor
Depositary 21
SECTION 5.05. Corporate Notices and Reports 22
SECTION 5.06. Deposit of Series C Preferred Stock by
the Company 23
SECTION 5.07. Indemnification by the Company 23
SECTION 5.08. Fees, Charges and Expenses 23
ARTICLE VI
AMENDMENT AND TERMINATION
SECTION 6.01. Amendment 23
SECTION 6.02. Termination 24
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. Counterparts 25
SECTION 7.02. Exclusive Benefits of Parties 26
SECTION 7.03. Invalidity of Provisions 26
SECTION 7.04. Notices 26
SECTION 7.05. Depositary's Agents 27
SECTION 7.06. Holders of Receipts Are Parties 27
SECTION 7.07. Governing Law 27
SECTION 7.08. Headings 27
TESTIMONIUM 27
SIGNATURES 28
EXHIBIT A: Form of Depositary Receipt
DEPOSIT AGREEMENT
DEPOSIT AGREEMENT dated as of
February 1, 1994, among Bowater Incorporated,
a Delaware corporation, Trust Company Bank,
as depositary (the "Depositary"), and all
holders from time to time of Depositary
Receipts executed and delivered hereunder.
WHEREAS, it is desired to provide, as hereinafter
set forth in this Deposit Agreement, for the deposit of
shares of 8.40% Series C Cumulative Preferred Stock, par
value $1 per share (the "Series C Preferred Stock") of the
Company with the Depositary, as agent for the beneficial
owners of the Series C Preferred Stock, for the purposes set
forth in this Deposit Agreement and for the execution and
delivery hereunder of the Receipts (as defined below)
evidencing Depositary Shares (as defined below) in respect
of the Series C Preferred Stock so deposited; and
WHEREAS, the Receipts are to be substantially in
the form of the Depositary Receipt annexed as Exhibit A,
with appropriate insertions, modifications and omissions, as
hereinafter provided in this Deposit Agreement;
NOW, THEREFORE, in consideration of the premises
contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as
follows:
ARTICLE I
DEFINITIONS
The following definitions shall apply to the
respective terms (in the singular and plural forms of such
terms) used in this Agreement and the Depositary Receipts:
"Business Day" shall mean any day other than a
Saturday, a Sunday or a day on which commercial banking
institutions in the City of New York, New York, or Atlanta,
Georgia, are authorized or obligated by law or executive
order to close.
"Certificate of Designations" shall mean the
Certificate of Designations of the 8.40% Series C Cumulative
Preferred Stock, par value $1 per share, as filed with the
Secretary of State of the State of Delaware, establishing
and setting forth the rights, preferences, privileges and
limitations of the Series C Preferred Stock.
"Certificate of Incorporation" shall mean the
Restated Certificate of Incorporation, as amended from time
to time, of the Company.
"Company" shall mean Bowater Incorporated, a
Delaware corporation, and its successors.
"Corporate Office" shall mean the office of the
Depositary in the city of Atlanta, Georgia, at which at any
particular time its business in respect of matters governed
by this Deposit Agreement shall be administered, which at
the date of this Deposit Agreement is located at One Park
Place, Atlanta, Georgia.
"Deposit Agreement" shall mean this agreement, as
the same may be amended, modified or supplemented from time
to time.
"Depositary" shall mean Trust Company Bank, as
Depositary hereunder, and any successor as depositary
hereunder.
"Depositary Share" shall mean an interest in one-
fourth of a share of the Series C Preferred Stock deposited
with the Depositary hereunder and the same proportional
interest in any and all other property received by the
Depositary in respect of such share of Series C Preferred
Stock and held under this Deposit Agreement, all as
evidenced by the Receipts executed and delivered hereunder.
Subject to the terms of this Deposit Agreement, each owner
of a Depositary Share is entitled, proportionately, to all
the rights, preferences and privileges of the Series C
Preferred Stock represented by such Depositary Share,
including the dividend, voting and liquidation rights
contained in the Certificate of Designations, and to the
benefits of all obligations of the Company under the
Certificate of Designations.
"Depositary's Agent" shall mean an agent appointed
by the Depositary as provided, and for the purposes
specified, in Section 7.05.
"Receipt" or "Depositary Receipt" shall mean a
Depositary Receipt executed and delivered hereunder to
evidence one or more Depositary Shares, whether in
definitive or temporary form.
The term "record holder" as applied to a Receipt
shall mean the person in whose name a Receipt is registered
on the books maintained by the Depositary for such purpose.
"Registrar" shall mean any bank or trust company
appointed to register Receipts as herein provided.
"Securities Act" shall mean the Securities Act of
1933, as amended.
"Series C Preferred Stock" shall mean the 8.40%
Series C Cumulative Preferred Stock, par value $1 per share,
of the Company.
ARTICLE II
FORM OF RECEIPTS, DEPOSIT OF SERIES C PREFERRED STOCK,
EXECUTION
AND DELIVERY, TRANSFER AND SURRENDER OF RECEIPTS
SECTION 2.01. Form and Transferability of
Receipts. Definitive Receipts shall be engraved or printed
or lithographed with steel-engraved borders and shall be
substantially in the form set forth in Exhibit A annexed to
this Deposit Agreement, with appropriate insertions,
modifications and omissions, as hereinafter provided.
Pending preparation of definitive Receipts, the Depositary,
upon the written order of the Company or any holder of
Series C Preferred Stock, as the case may be, delivered for
deposit in compliance with Section 2.02, shall execute and
deliver temporary Receipts which are printed, lithographed,
typewritten, mimeographed or otherwise substantially of the
tenor of the definitive Receipts in lieu of which they are
executed and delivered and with such appropriate insertions,
omissions, substitutions and other variations as the persons
executing such Receipts may determine, as evidenced by their
execution of such Receipts. If temporary Receipts are
executed and delivered, the Company and the Depositary will
cause definitive Receipts to be prepared without
unreasonable delay. After the preparation of definitive
Receipts, the temporary Receipts shall be exchangeable for
definitive Receipts upon surrender of the temporary Receipts
at an office described in the second to last paragraph of
Section 2.02, without charge to the holder. Upon surrender
for cancellation of any one or more temporary Receipts, the
Depositary shall execute and deliver in exchange therefor
definitive Receipts representing the same number of
Depositary Shares as represented by the surrendered
temporary Receipt or Receipts. Such exchange shall be made
at the Company's expense and without any charge therefor.
Until so exchanged, the temporary Receipts shall in all
respects be entitled to the same benefits under this
Agreement, and with respect to the Series C Preferred Stock
deposited hereunder, as definitive Receipts.
Receipts shall be executed by the Depositary by
the manual signature of a duly authorized signatory of the
Depositary; provided, however, that such signature may be a
facsimile if a Registrar (other than the Depositary) shall
have countersigned the Receipts by the manual signature of a
duly authorized signatory of the Registrar. No Receipt
shall be entitled to any benefits under this Deposit
Agreement or be valid or obligatory for any purpose unless
it shall have been executed as provided in the preceding
sentence. The Depositary shall record on its books each
Receipt executed as provided above and delivered as
hereinafter provided.
Except as the Depositary may otherwise determine,
Receipts shall be in denominations of any number of whole
Depositary Shares. All Receipts shall be dated the date of
their execution.
Receipts may be endorsed with or have incorporated
in the text thereof such legends or recitals or changes not
inconsistent with the provisions of this Deposit Agreement
as may be required by the Depositary or required to comply
with any applicable law or regulation or with the rules and
regulations of any securities exchange upon which the
Series C Preferred Stock or the Depositary Shares may be
listed or to conform with any usage with respect thereto, or
to indicate any special limitations or restrictions to which
any particular Receipts are subject by reason of the date of
issuance of the Series C Preferred Stock or otherwise.
Title to any Receipt (and to the Depositary Shares
evidenced by such Receipt) that is properly endorsed or
accompanied by a properly executed instrument of transfer or
endorsement, or other instrument satisfactory to the
Depositary, shall be transferable by delivery; provided,
however, that until a Receipt shall be transferred on the
books of the Depositary as provided in Section 2.04, the
Depositary and the Company may, notwithstanding any notice
to the contrary, treat the record holder thereof at such
time as the absolute owner thereof for the purpose of
determining the person entitled to distribution of dividends
or other distributions or to any notice provided for in this
Deposit Agreement and for all other purposes.
SECTION 2.02. Deposit of Series C Preferred
Stock; Execution and Delivery of Receipts in Respect
Thereof. Subject to the terms and conditions of this
Deposit Agreement, the Company or any holder of Series C
Preferred Stock may deposit shares of Series C Preferred
Stock under this Deposit Agreement by delivery to the
Depositary of a certificate or certificates for the shares
of Series C Preferred Stock to be deposited, properly
endorsed or accompanied by a properly executed instrument of
transfer or endorsement in form satisfactory to the
Depositary, together with (i) all such certifications as may
be required by the Depositary in accordance with the
provisions of this Deposit Agreement and (ii) a written
order directing the Depositary to execute and deliver to or
upon the written order of the person or persons stated in
such order a Receipt or Receipts for the number of
Depositary Shares representing such deposited Series C
Preferred Stock.
If required by the Depositary, Series C Preferred
Stock presented for deposit at any time, whether or not the
register of holders of Receipts is closed, shall also be
accompanied by an agreement or assignment, or other
instrument satisfactory to the Depositary, that will provide
for the prompt transfer to the Depositary or its nominee of
any dividend or right to subscribe for additional Series C
Preferred Stock or to receive other property that any person
in whose name the Series C Preferred Stock is or has been
registered may thereafter receive upon or in respect of such
deposited Series C Preferred Stock, or in lieu thereof such
agreement of indemnity or other agreement as shall be
satisfactory to the Depositary.
Upon receipt by the Depositary of a certificate or
certificates for the shares of Series C Preferred Stock to
be deposited hereunder, together with the other documents
specified above, the Depositary shall, as soon as transfer
and registration can be accomplished, present such
certificates to the registrar and transfer agent of the
Series C Preferred Stock for transfer and registration in
the name of the Depositary or its nominee of the shares of
Series C Preferred Stock being deposited. Deposited Series
C Preferred Stock shall be held by the Depositary in an
account to be established by the Depositary at the Corporate
Office.
Upon receipt by the Depositary of a certificate or
certificates for Series C Preferred Stock to be deposited
hereunder, together with the other documents specified
above, the Depositary, subject to the terms and conditions
of this Deposit Agreement, shall execute and deliver to or
upon the order of the person or persons named in the written
order delivered to the Depositary referred to in the first
paragraph of this Section 2.02 a Receipt or Receipts for the
number of whole Depositary Shares representing the Series C
Preferred Stock so deposited and registered in such name or
names as may be requested by such person or persons. The
Depositary shall execute and deliver such Receipt or
Receipts at the Corporate Office, except that, at the
request, risk and expense of any person requesting such
delivery, such delivery may be made at such other place as
may be designated by such person. In each case, delivery
will be made only upon payment by such person to the
Depositary of all taxes and other governmental charges and
any fees payable in connection with such deposit and the
transfer of the deposited Series C Preferred Stock.
The Company shall deliver to the Depositary from
time to time such quantities of Receipts as the Depositary
may request to enable the Depositary to perform its
obligations under this Deposit Agreement.
SECTION 2.03. Redemption of Series C Preferred
Stock for Cash. Whenever the Company shall elect to redeem
shares of Series C Preferred Stock in accordance with the
Certificate of Designations it shall (unless otherwise
agreed in writing with the Depositary) give the Depositary
in its capacity as Depositary notice of the date of such
proposed redemption of the Series C Preferred Stock, which
notice shall be given not less than 40 nor more than 70 days
prior to the date of the proposed redemption and be
accompanied by a certificate from the Company stating that
such redemption of the Series C Preferred Stock is in
accordance with the provisions of the Certificate of
Designations. Such notice shall be in addition to the
notice required to be given for redemption pursuant to the
Certificate of Designations. On the date of any such
redemption of Series C Preferred Stock, provided that the
Company shall then have paid in full to the Depositary the
redemption price of the Series C Preferred Stock to be
redeemed, the Depositary shall redeem the number of
Depositary Shares representing such redeemed Series C
Preferred Stock. Subject to the penultimate sentence of
this Paragraph, the Depositary shall mail, first class
postage prepaid, notice of the redemption of Series C
Preferred Stock and the proposed simultaneous redemption of
the Depositary Shares representing the Series C Preferred
Stock to be redeemed, not less than 30 and not more than 60
days prior to the date fixed for redemption of such Series C
Preferred Stock and Depositary Shares (the "Redemption
Date"), to the record holders of the Receipts evidencing the
Depositary Shares to be so redeemed, at the addresses of
such holders as they appear on the records of the
Depositary; but neither failure to mail any such notice to
one or more such holders nor any defect in any notice to one
or more such holders shall affect the sufficiency of the
proceedings for redemption as to other holders. Each such
notice shall state: (i) the Redemption Date; (ii) the
number of Depositary Shares to be redeemed and, if less than
all the Depositary Shares held by any such holder are to be
redeemed, the number of such Depositary Shares held by such
holder to be so redeemed; (iii) the redemption price;
(iv) the place or places where Receipts evidencing
Depositary Shares are to be surrendered for payment of the
redemption price; and (v) that dividends in respect of the
shares of Series C Preferred Stock represented by the
Depositary Shares to be redeemed will cease to accumulate on
such Redemption Date. Any such notices shall be mailed in
the same manner as notices of redemption of the Series C
Preferred Stock are required to be mailed pursuant to
paragraph 3 of the Certificate of Designations and published
in the same manner as notices of redemption of the Series C
Preferred Stock are required to be published pursuant to
said paragraph, if so required. In case fewer than all the
outstanding Depositary Shares are to be redeemed, the
Depositary Shares to be redeemed shall be selected by lot or
pro rata (as nearly as may be) or by any other equitable
method determined by the Depositary to be consistent with
the method determined by the Board of Directors of the
Company with respect to the Series C Preferred Stock.
Notice having been mailed and published by the
Depositary as aforesaid, from and after the Redemption Date
(unless the Company shall have failed to redeem the shares
of Series C Preferred Stock to be redeemed by it, as set
forth in the Company's notice provided for in the preceding
paragraph), the Depositary Shares called for redemption
shall be deemed no longer to be outstanding and all rights
of the holders of Receipts evidencing such Depositary Shares
(except the right to receive the redemption price) shall, to
the extent of such Depositary Shares, cease and terminate.
Upon surrender in accordance with said notice of the
Receipts evidencing such Depositary Shares (properly
endorsed or assigned for transfer, if the Depositary shall
so require), such Depositary Shares shall be redeemed at a
redemption price per Depositary Share equal to one-fourth of
the redemption price per share paid in respect of the shares
of Series C Preferred Stock plus all money and other
property, if any, represented by such Depositary Shares,
including all amounts paid by the Company in respect of
dividends which on the redemption date have accrued on the
shares of Series C Preferred Stock to be so redeemed and
have not theretofore been declared or paid. The foregoing
shall be subject further to the terms and conditions of the
Certificate of Designations.
If fewer than all of the Depositary Shares
evidenced by a Receipt are called for redemption, the
Depositary will deliver to the holder of such Receipt upon
its surrender to the Depositary, together with the
redemption payment, a new Receipt evidencing the Depositary
Shares evidenced by such prior Receipt and not called for
redemption.
The Depositary shall not be required (a) to
execute and deliver, transfer or exchange any Receipts for a
period beginning at the opening of business 15 days next
preceding any selection of Depositary Shares and Series C
Preferred Stock to be redeemed and ending at the close of
business on the day of the mailing of notice of redemption
of Depositary Shares or (b) to transfer or exchange for
another Receipt any Receipt evidencing Depositary Shares
called or being called for redemption in whole or in part,
except as provided in the immediately preceding paragraph.
SECTION 2.04. Transfer of Receipts. Subject to
the terms and conditions of this Deposit Agreement, the
Depositary shall make transfers on its books from time to
time of Receipts upon any surrender thereof at the Corporate
Office or such other office as the Depositary may designate
for such purpose, by the holder in person or by a duly
authorized attorney, properly endorsed or accompanied by a
properly executed instrument of transfer or endorsement, or
other instrument satisfactory to the Depositary, together
with evidence of the payment of any transfer taxes as may be
required by law. Upon such surrender, the Depositary shall
execute a new Receipt or Receipts and deliver the same to or
upon the order of the person or persons entitled thereto
evidencing the same aggregate number of Depositary Shares
evidenced by the Receipt or Receipts surrendered.
SECTION 2.05. Combination and Split-ups of
Receipts. Upon surrender of a Receipt or Receipts at the
Corporate Office or such other office as the Depositary may
designate for the purposes of effecting a split-up or
combination of Receipts, subject to the terms and conditions
of this Deposit Agreement, the Depositary shall execute and
deliver a new Receipt or Receipts in the authorized
denominations requested evidencing the same aggregate number
of Depositary Shares evidenced by the Receipt or Receipts
surrendered; provided, however, that the Depositary shall
not execute and deliver any Receipt evidencing a fractional
Depositary Share.
SECTION 2.06. Surrender of Receipts and
Withdrawal of Series C Preferred Stock. Any holder of a
Receipt or Receipts may withdraw any or all of the Series C
Preferred Stock (but only in whole shares of Series C
Preferred Stock) represented by the Depositary Shares
evidenced by such Receipts and all money and other property,
if any, represented by such Depositary Shares by
surrendering such Receipt or Receipts, properly endorsed or
accompanied by a properly executed instrument of transfer or
endorsement, or other instrument satisfactory to the
Depositary, at the Corporate Office or such other office as
the Depositary may designate for such withdrawals. After
such surrender, without unreasonable delay, the Depositary
shall deliver to such holder, or to the person or persons
designated by such holder as hereinafter provided, the whole
number of shares of Series C Preferred Stock and all such
money and other property, if any, represented by the
Depositary Shares evidenced by the Receipt or Receipts so
surrendered for withdrawal. If the Receipt or Receipts
delivered by the holder to the Depositary in connection with
such withdrawal shall evidence a number of Depositary Shares
in excess of the number of whole Depositary Shares
representing the whole number of shares of Series C
Preferred Stock to be withdrawn, the Depositary shall at the
same time, in addition to such whole number of shares of
Series C Preferred Stock and such money and other property,
if any, to be withdrawn, deliver to such holder, or (subject
to Section 2.04) upon his order, a new Receipt or Receipts
evidencing such excess number of whole Depositary Shares.
Delivery of the Series C Preferred Stock and such money and
other property being withdrawn may be made by the delivery
of such certificates, documents of title, and other
instruments as the Depositary may deem appropriate, which,
if required by the Depositary, shall be properly endorsed or
accompanied by proper instruments of transfer.
If the Series C Preferred Stock and the money and
other property being withdrawn are to be delivered to a
person or persons other than the record holder of the
Receipt or Receipts being surrendered for withdrawal of
Series C Preferred Stock, such holder shall execute and
deliver to the Depositary a written order so directing the
Depositary and the Depositary may require that the Receipt
or Receipts surrendered by such holder for withdrawal of
such shares of Series C Preferred Stock be properly endorsed
in blank or accompanied by a properly executed instrument of
transfer or endorsement in blank.
The Depositary shall deliver the Series C
Preferred Stock and the money and other property, if any,
represented by the Depositary Shares evidenced by Receipts
surrendered for withdrawal at the Corporate Office, except
that, at the request, risk and expense of the holder
surrendering such Receipt or Receipts and for the account of
the holder thereof, such delivery may be made at such other
place as may be designated by such holder.
SECTION 2.07 Limitations on Execution and
Delivery, Transfer, Split-up, Combination, Surrender and
Exchange of Receipts. As a condition precedent to the
execution and delivery, transfer, split-up, combination,
surrender or exchange of any Receipt, the Depositary, any of
the Depositary's Agents or the Company may require any or
all of the following: (i) payment to it of a sum sufficient
for the payment (or, in the event that the Depositary or the
Company shall have made such payment, the reimbursement to
it) of any tax or other governmental charge with respect
thereto (including any such tax or charge with respect to
the Series C Preferred Stock being deposited or withdrawn);
(ii) the production of proof satisfactory to it as to the
identity and genuineness of any signature; and (iii)
compliance with such regulations, if any, as the Depositary
or the Company may establish not inconsistent with the
provisions of the Deposit Agreement.
The deposit of Series C Preferred Stock may be
refused, the delivery of Receipts against Series C Preferred
Stock may be suspended, the transfer of Receipts may be
refused, and the transfer, split-up, combination, surrender
or exchange of outstanding Receipts may be suspended (i)
during any period when the register of holders of Receipts
is closed, (ii) if any such action is deemed necessary or
advisable by the Depositary, any of the Depositary's Agents
or the Company at any time or from time to time because of
any requirement of law or of any government or governmental
body or commission, or under any provision of this Deposit
Agreement, or (iii) with the approval of the Company, for
any other reason.
SECTION 2.08. Lost Receipts, etc. In case any
Receipt shall be mutilated or destroyed or lost or stolen,
the Depositary in its discretion may execute and deliver a
Receipt of like form and tenor in exchange and substitution
for such mutilated Receipt or in lieu of and in substitution
for such destroyed, lost or stolen Receipt; provided,
however, that the holder thereof provides the Depositary
with (i) evidence satisfactory to the Depositary of such
destruction, loss or theft of such Receipt, of the
authenticity thereof and of his ownership thereof, (ii)
reasonable indemnification satisfactory to the Depositary
and (iii) payment of any expense (including fees, charges
and expenses of the Depositary) in connection with such
execution and delivery.
SECTION 2.09. Cancellation and Destruction of
Surrendered Receipts. All Receipts surrendered to the
Depositary or any Depositary's Agent shall be cancelled by
the Depositary. Except as prohibited by applicable law or
regulation, the Depositary is authorized to destroy such
Receipts so cancelled.
ARTICLE III
CERTAIN OBLIGATIONS OF HOLDERS
OF RECEIPTS AND THE COMPANY
SECTION 3.01. Filing Proofs, Certificates and
Other Information. Any person presenting Series C Preferred
Stock for deposit or any holder of a Receipt may be required
from time to time to file such proof of residence or other
information, to execute such certificates and to make such
representations and warranties as the Depositary or the
Company may reasonably deem necessary or proper. The
Depositary or the Company may withhold or delay the delivery
of any Receipt, the transfer, redemption or exchange of any
Receipt, the withdrawal of the Series C Preferred Stock or
money or other property, if any, represented by the
Depositary Shares evidenced by any Receipt or the
distribution of any dividend or other distribution until
such proof or other information is filed, such certificates
are executed or such representations and warranties are
made.
SECTION 3.02. Payment of Taxes or Other
Governmental Charges. If any tax or other governmental
charge shall become payable by or on behalf of the
Depositary with respect to any Receipt, the Depositary
Shares evidenced by such Receipt, the Series C Preferred
Stock (or fractional interest therein) represented by such
Depositary Shares or any transaction referred to in
Section 4.06, such tax (including transfer, issuance or
acquisition taxes, if any) or governmental charge shall be
payable by the holder of such Receipt. Until such payment
is made, transfer, redemption or exchange of any Receipt or
any withdrawal of the Series C Preferred Stock or money or
other property, if any, represented by the Depositary Shares
evidenced by such Receipt may be refused, any dividend or
other distribution with respect to such Receipt or the
Series C Preferred Stock represented by the Depositary
Shares evidenced by such Receipt may be withheld and any
part or all of the Series C Preferred Stock or other
property represented by the Depositary Shares evidenced by
such Receipt may be sold for the account of the holder
thereof (after attempting by reasonable means to notify such
holder prior to such sale). Any dividend or other
distribution so withheld and the proceeds of any such sale
may be applied to any payment of such tax or other
governmental charge, the holder of such Receipt remaining
liable for any deficiency. The Depositary shall act as the
withholding agent for any payments, distributions, and
exchanges made with respect to the Depositary Shares and
Receipts, and the Series C Preferred Stock, or other
securities or assets represented thereby (collectively, the
"Securities"). The Depositary shall be responsible with
respect to the Securities for the timely (i) collection and
deposit of any required withholding or backup withholding
tax, and (ii) filing of any information returns or other
documents with federal (and other applicable) taxing
authorities. In the event the Depositary is required to pay
any such amounts, the Company shall reimburse the Depositary
for payment thereof upon the request of the Depositary and
the Depositary shall, upon the Company's request and as
instructed by the Company, pursue its rights against such
holder at the Company's expense.
SECTION 3.03. Representations and Warranties as
to Series C Preferred Stock. Each person depositing Series
C Preferred Stock under this Deposit Agreement shall be
deemed thereby to represent and warrant that such Series C
Preferred Stock and each certificate therefor are valid and
that the person making such deposit is duly authorized to do
so. Such representations and warranties shall survive the
deposit of the Series C Preferred Stock and the execution
and delivery of Receipts.
ARTICLE IV
THE SERIES C PREFERRED STOCK, NOTICES
SECTION 4.01. Cash Distributions. Whenever the
Depositary shall receive any cash dividend or other cash
distribution on the Series C Preferred Stock, the Depositary
shall, subject to Section 3.02, distribute to record holders
of Receipts on the record date fixed pursuant to
Section 4.04 such portions of such sum as are, as nearly as
practicable, proportionate to the respective numbers of
Depositary Shares evidenced by the Receipts held by such
holders; provided, however, that in case the Company or the
Depositary shall be required to withhold and does withhold
from any cash dividend or other cash distribution in respect
of the Series C Preferred Stock an amount on account of
taxes or as otherwise required by law, regulation or court
order, the amount made available for distribution or
distributed in respect of Depositary Shares shall be reduced
accordingly. The Depositary shall distribute or make
available for distribution, as the case may be, only such
amount, however, as can be distributed without attributing
to any owner of Depositary Shares a fraction of one cent and
any balance not so distributable shall be held by the
Depositary (without liability for interest thereon) and
shall be added to and be treated as part of the next sum
received by the Depositary for distribution to record
holders of Receipts then outstanding.
SECTION 4.02. Distributions Other Than Cash.
Whenever the Depositary shall receive any distribution other
than cash on the Series C Preferred Stock, the Depositary
shall, subject to Section 3.02, distribute to record holders
of Receipts on the record date fixed pursuant to
Section 4.04 such portions of the securities or property
received by it as are, as nearly as practicable,
proportionate to the respective numbers of Depositary Shares
evidenced by the Receipts held by such holders, in any
manner that the Depositary and the Company may deem
equitable and practicable for accomplishing such
distribution. If, in the opinion of the Company after
consultation with the Depositary, such distribution cannot
be made proportionately among such record holders, or if for
any other reason (including any requirement that the Company
or the Depositary withhold an amount on account of taxes or
as otherwise required by law, regulation or court order),
the Depositary deems, after consultation with the Company,
such distribution not to be feasible, the Depositary may,
with the approval of the Company, adopt such method as it
deems equitable and practicable for the purpose of effecting
such distribution, including the sale (at public or private
sale) of the securities or property thus received, or any
part thereof, at such place or places and upon such terms as
it may deem proper. The net proceeds of any such sale
shall, subject to Section 3.02, be distributed or made
available for distribution, as the case may be, by the
Depositary to record holders of Receipts as provided by
Section 4.01 in the case of a distribution received in cash.
SECTION 4.03. Subscription Rights, Preferences or
Privileges. If the Company shall at any time offer or cause
to be offered to the persons in whose names Series C
Preferred Stock is registered on the books of the Company
any rights, preferences or privileges to subscribe for or to
purchase any securities or any rights, preferences or
privileges of any other nature, such rights, preferences or
privileges shall in each such instance be made available by
the Depositary to the record holders of Receipts if the
Company so directs in such manner as the Company shall
instruct (including by the execution and delivery to such
record holders of warrants representing such rights,
preferences or privileges); provided, however, that (a) if
at the time of issue or offer of any such rights,
preferences or privileges the Company determines that it is
not lawful or feasible to make such rights, preferences or
privileges available to some or all holders of Receipts (by
the execution and delivery of warrants or otherwise) or (b)
if and to the extent instructed by holders of Receipts who
do not desire to exercise such rights, preferences or
privileges, the Depositary shall then, if so instructed by
the Company, and if applicable laws and the terms of such
rights, preferences or privileges so permit, sell such
rights, preferences or privileges of such holders at public
or private sale, at such place or places and upon such terms
as it may deem proper. The net proceeds of any such sale
shall, subject to Section 3.02, be distributed by the
Depositary to the record holders of Receipts entitled
thereto in accordance with the withholding and fractional
amount provisions of Section 4.01.
If registration under the Securities Act of the
securities to which any rights, preferences or privileges
relate is required in order for holders of Receipts to be
offered or sold such securities, the Company shall promptly
file a registration statement pursuant to the Securities Act
with respect to such securities and use its best efforts and
take all steps available to it to cause such registration
statement to become effective sufficiently in advance of the
expiration of such rights, preferences or privileges to
enable such holders to exercise such rights, preferences or
privileges. In no event shall the Depositary make available
to the holders of Receipts any right, preference or
privilege to subscribe for or to purchase any securities
unless and until notified by the Company in writing that
such registration statement has become effective or that the
offering and sale of such securities to such holders are
exempt from registration under the provisions of the
Securities Act.
If any other action under the law of any
jurisdiction or any governmental or administrative
authorization, consent or permit is required in order for
such rights, preferences or privileges to be made available
to holders of Receipts, the Company agrees with the
Depositary that the Company will use its best efforts to
take such action or obtain such authorization, consent or
permit sufficiently in advance of the expiration of such
rights, preferences or privileges to enable such holders to
exercise such rights, preferences or privileges.
SECTION 4.04. Notice of Dividends, Fixing of
Record Date for Holders of Receipts. Whenever any cash
dividend or other cash distribution shall become payable, or
any distribution other than cash shall be made, or any
rights, preferences or privileges shall at any time be
offered, with respect to the Series C Preferred Stock, or
whenever the Depositary shall receive notice of (i) any
meeting at which holders of Series C Preferred Stock are
entitled to vote or of which holders of Series C Preferred
Stock are entitled to notice or (ii) any election on the
part of the Company to call for redemption any shares of
Series C Preferred Stock, the Depositary shall in each such
instance fix a record date (which shall be the same date as
the record date fixed by the Company with respect to the
Series C Preferred Stock) for the determination of the
holders of Receipts (i) who shall be entitled to receive
such dividend, distribution, rights, preferences or
privileges or the net proceeds of the sale thereof, or to
give instructions for the exercise of voting rights at any
such meeting or to receive notice of such meeting or
(ii) whose Depositary Shares are to be so redeemed.
SECTION 4.05. Voting Rights. Upon issuance of
notice of any meeting at which the holders of Series C
Preferred Stock are entitled to vote, the Company shall
direct the Depositary, as soon as practicable thereafter, to
mail to the record holders of Receipts a notice, which shall
be provided by the Company and which shall contain (i) such
information as is contained in such notice of meeting, (ii)
a statement that the holders of Receipts at the close of
business on a specified record date fixed pursuant to
Section 4.04 will be entitled, subject to any applicable
provision of law, the Certificate of Incorporation or the
Certificate of Designations, to instruct the Depositary as
to the exercise of the voting rights pertaining to the
amount of Series C Preferred Stock represented by their
respective Depositary Shares and (iii) a brief statement as
to the manner in which such instructions may be given. Upon
the written request of a holder of a Receipt on such record
date, the Depositary shall endeavor insofar as practicable
to vote or cause to be voted the amount of Series C
Preferred Stock represented by the Depositary Shares
evidenced by such Receipt in accordance with the
instructions set forth in such request. The Company hereby
agrees to take all reasonable action that may be deemed
necessary by the Depositary in order to enable the
Depositary to vote such Series C Preferred Stock or cause
such Series C Preferred Stock to be voted. In the absence
of specific instructions from the holder of a Receipt, the
Depositary will abstain from voting to the extent of the
Series C Preferred Stock represented by the Depositary
Shares evidenced by such Receipt. After aggregating all
voting Depositary Shares, the Depositary will disregard for
voting purposes any fractional share of Series C Preferred
Stock remaining.
SECTION 4.06. Changes Affecting Series C
Preferred Stock and Reclassifications, Recapitalizations,
etc. Upon any split-up, consolidation or any other
reclassification of Series C Preferred Stock, or upon any
recapitalization, reorganization, merger, amalgamation or
consolidation affecting the Company or to which it is a
party or sale of all or substantially all of the Company's
assets, the Depositary shall, upon the instructions of the
Company, treat any shares of stock or other securities or
property (including cash) that shall be received by the
Depositary in exchange for or upon conversion of or in
respect of the Series C Preferred Stock as new deposited
property under this Deposit Agreement, and Receipts then
outstanding shall thenceforth represent the proportionate
interests of holders thereof in the new deposited shares,
other securities or other property so received in exchange
for or upon conversion or in respect of such Series C
Preferred Stock. In any such case the Depositary may, in
its discretion, with the approval of the Company, execute
and deliver additional Receipts, or may call for the
surrender of all outstanding Receipts to be exchanged for
new Receipts specifically describing such new deposited
shares, other securities or other property.
SECTION 4.07. Inspection of Reports. The
Depositary shall make available for inspection by holders
of Receipts at the Corporate Office and at such other places
as it may from time to time deem advisable during normal
business hours any reports and communications received from
the Company that are both received by the Depositary as the
holder of Series C Preferred Stock and made generally
available to the holders of Series C Preferred Stock by the
Company.
SECTION 4.08. List of Receipt Holders. Promptly
upon request from time to time by the Company and at the
Company's expense, the Depositary shall furnish to it a
list, as of a recent date, of the names, addresses and
holdings of Depositary Shares of all persons in whose names
Receipts are registered on the books of the Depositary.
ARTICLE V
THE DEPOSITARY AND THE COMPANY
SECTION 5.01. Maintenance of Offices, Agencies,
Transfer Books by the Depositary, the Registrar. Upon
execution of this Deposit Agreement in accordance with its
terms, the Depositary shall maintain (i) at the Corporate
Office, facilities for the execution and delivery, transfer,
surrender and exchange, split-up and combination of Receipts
and deposit and withdrawal of Series C Preferred Stock and
(ii) at the offices of the Depositary's Agents, if any,
facilities for the delivery, transfer, surrender and
exchange, split-up, combination and redemption of Receipts
and deposit and withdrawal of Series C Preferred Stock, all
in accordance with the provisions of this Deposit Agreement.
The Depositary shall keep books at the Corporate
Office for the registration and transfer of Receipts, which
books during normal business hours shall be open for
inspection by the record holders of Receipts, as provided by
applicable law, and by the Company. The Depositary shall
consult with the Company upon receipt of any request for
inspection. The Depositary may close such books, at any
time or from time to time, when deemed expedient by it in
connection with the performance of its duties hereunder.
If the Receipts or the Depositary Shares evidenced
thereby or the Series C Preferred Stock represented by such
Depositary Shares shall be listed on the New York Stock
Exchange, Inc., the Depositary may, with the approval of the
Company, appoint a Registrar for registry of such Receipts
or Depositary Shares in accordance with the requirements of
such Exchange. Such Registrar (which may be the Depositary
if so permitted by the requirements of such Exchange) may be
removed and a substitute registrar appointed by the
Depositary upon the request or with the approval of the
Company. If the Receipts, such Depositary Shares or such
Series C Preferred Stock are listed on one or more other
stock exchanges, the Company will, with the assistance of
the Depositary, arrange such facilities for the delivery,
transfer, surrender and exchange of such Receipts, such
Depositary Shares or such Series C Preferred Stock as may be
required by law or applicable stock exchange regulations.
SECTION 5.02. Prevention of or Delay in
Performance by the Depositary, the Depositary's Agents or
the Company. Neither the Depositary nor any Depositary's
Agent nor the Company shall incur any liability to any
holder of any Receipt, if by reason of any provision of any
present or future law or regulation thereunder of the United
States of America or of any other governmental authority or,
in the case of the Depositary or the Depositary's Agent, by
reason of any provision, present or future, of the
Certificate of Incorporation or the Certificate of
Designations or, in the case of the Company, the Depositary
or the Depositary's Agent, by reason of any act of God or
war or other circumstance beyond the control of the relevant
party, the Depositary, any Depositary's Agent or the Company
shall be prevented or forbidden from doing or performing any
act or thing that the terms of this Deposit Agreement
provide shall be done or performed; nor shall the
Depositary, any Depositary's Agent or the Company incur any
liability to any holder of a Receipt by reason of any
nonperformance or delay, caused as aforesaid, in the
performance of any act or thing that the terms of this
Deposit Agreement provide shall or may be done or performed
or by reason of any exercise of, or failure to exercise, any
discretion provided for in this Deposit Agreement.
SECTION 5.03. Obligations of the Depositary, the
Depositary's Agents and the Company. Neither the Depositary
nor any Depositary's Agent nor the Company assumes any
obligation or shall be subject to any liability under this
Deposit Agreement or any Receipt to holders of Receipts
other than that each of them agrees to use good faith in the
performance of such duties as are specifically set forth in
this Deposit Agreement.
Neither the Depositary nor any Depositary's Agent
nor the Company shall be under any obligation to appear in,
prosecute or defend any action, suit or other proceeding
with respect to the Series C Preferred Stock, Depositary
Shares or Receipts that in its opinion may involve it in
expense or liability, unless indemnity satisfactory to it
against all expense and liability be furnished as often as
may be required.
Neither the Depositary nor any Depositary's Agent
nor the Company shall be liable for any action or any
failure to act by it in reliance upon the advice of, or
information from, legal counsel, accountants, any person
presenting Series C Preferred Stock for deposit, any holder
of a Receipt or any other person believed by it in good
faith to be competent to give such advice or information.
The Depositary, any Depositary's Agent and the Company may
each rely and shall each be protected in acting upon any
written notice, request, direction or other document
believed by it to be genuine and to have been signed or
presented by the proper party or parties.
The Depositary, its parent, affiliates,
subsidiaries, officers, directors or employees and any
Depositary's Agent may own, buy, sell or deal in any class
of securities of the Company and its affiliates and in
Receipts or Depositary Shares or become pecuniarily
interested in any transaction in which the Company or its
officers may be interested or contract with or lend money to
the Company or any of its affiliates or officers or
otherwise act fully or as freely as if it were not the
Depositary or the Depositary's Agent hereunder. The
Depositary may also act as transfer agent or registrar of
any of the securities of the Company and its affiliates.
It is intended that neither the Depositary nor any
Depositary's Agent shall be deemed to be an "issuer" of
securities under the federal securities laws or applicable
state securities laws, it being expressly understood and
agreed that the Depositary and any Depositary's Agent are
acting only in a ministerial capacity as Depositary for the
Series C Preferred Stock; provided, however, that the
Depositary agrees to comply with all information reporting
and withholding requirements applicable to it under law or
this Deposit Agreement in its capacity as Depositary.
Neither the Depositary (or its officers,
directors, employees or agents) nor any Depositary's Agent
makes any representation or has any responsibility as to the
validity of the Registration Statement pursuant to which the
Depositary Shares are registered under the Securities Act,
the Series C Preferred Stock, the Depositary Shares, the
Receipts (except for its countersignatures thereon) or any
instruments referred to therein or herein (other than an
instrument executed by the Depositary or Depositary's
Agent), or as to the correctness of any statement made
therein or herein or for the failure of the Company to
comply with any covenants contained in this Agreement or the
Receipts; provided, however, that the Depositary is
responsible for its representations in this Deposit
Agreement.
The Depositary assumes no responsibility for the
correctness of the description that appears in the Receipts,
which can be taken as a statement of the Company summarizing
certain provisions of this Deposit Agreement.
Notwithstanding any other provision herein or in the
Receipts, the Depositary makes no warranties or
representations as to the validity, genuineness or
sufficiency of any Series C Preferred Stock at any time
deposited with the Depositary hereunder or of the Depositary
Shares, as to the validity or sufficiency of this Deposit
Agreement, as to the value of the Depositary Shares or as to
any right, title or interest of the record holders of
Receipts in and to the Depositary Shares except that the
Depositary hereby represents and warrants as follows: (i)
the Depositary has been duly organized and is validly
existing and in good standing under the laws of the State of
Georgia, with full power, authority and legal right under
such laws to execute, deliver and carry out the terms of
this Deposit Agreement; (ii) this Deposit Agreement has been
duly authorized, executed and delivered by the Depositary;
and (iii) this Deposit Agreement constitutes a valid and
binding obligation of the Depositary, enforceable against
the Depositary in accordance with its terms, except as
enforcement thereof may be limited by bankruptcy,
insolvency, reorganization or other similar laws affecting
enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of
equity (regardless of whether enforcement is considered in a
proceeding in equity or at law). The Depositary shall not
be accountable for the use or application by the Company of
the Depositary Shares or the Receipts or the proceeds
thereof.
SECTION 5.04. Resignation and Removal of the
Depositary; Appointment of Successor Depositary. The
Depositary may at any time resign as Depositary hereunder by
notice of its election to do so delivered to the Company,
such resignation to take effect upon the appointment of a
successor depositary and its acceptance of such appointment
as hereinafter provided.
The Depositary may at any time be removed by the
Company by notice of such removal delivered to the
Depositary, such removal to take effect upon the appointment
of a successor depositary and its acceptance of such
appointment as hereinafter provided.
In case at any time the Depositary acting
hereunder shall resign or be removed, the Company shall,
within 45 days after the delivery of the notice of
resignation or removal, as the case may be, appoint a
successor depositary, which shall be a bank or trust
company, or an affiliate of a bank or trust company, having
its principal office in the United States of America and
having a combined capital and surplus of at least
$50,000,000. If a successor depositary shall not have been
appointed in 45 days, the resigning Depositary may petition
a court of competent jurisdiction to appoint a successor
depositary. Every successor depositary shall execute and
deliver to its predecessor and to the Company an instrument
in writing accepting its appointment hereunder, and
thereupon such successor depositary, without any further act
or deed, shall become fully vested with all the rights,
powers, duties and obligations of its predecessor and for
all purposes shall be the Depositary under this Deposit
Agreement, and such predecessor, upon payment of all sums
due it and on the written request of the Company, shall
promptly execute and deliver an instrument transferring to
such successor all rights and powers of such predecessor
hereunder, shall duly assign, transfer and deliver all
rights, title and interest in the Series C Preferred Stock
and any moneys or property held hereunder to such successor
and shall deliver to such successor a list of the record
holders of all outstanding Receipts and such other records
respecting the Receipts, the Depositary Shares and the
Series C Preferred Stock as the successor shall require in
order to perform its duties. Any successor depositary shall
promptly mail notice of its appointment to the record
holders of Receipts.
Any corporation into or with which the Depositary
may be merged, consolidated or converted shall be the
successor of such Depositary without the execution or filing
of any document or any further act. Such successor
depositary may execute the Receipts either in the name of
the predecessor depositary or in the name of the successor
depositary.
SECTION 5.05. Corporate Notices and Reports. The
Company agrees that it will deliver to the Depositary, and
the Depositary will, promptly after receipt thereof, and as
directed by the Company transmit to the record holders of
Receipts, in each case at the most recent address recorded
in the Depositary's books, copies of all notices and reports
(including financial statements) required by law, by the
rules of any national securities exchange upon which the
Series C Preferred Stock, the Depositary Shares or the
Receipts are listed or by the Certificate of Incorporation
and the Certificate of Designations to be furnished by the
Company to holders of Series C Preferred Stock. Such
transmission will be at the Company's expense and the
Company will provide the Depositary with such number of
copies of such documents as the Depositary may reasonably
request. In addition, the Depositary will transmit to the
record holders of Receipts at the Company's expense such
other documents as may be requested by the Company.
SECTION 5.06. Deposit of Series C Preferred Stock
by the Company. Neither the Company nor any company
controlled by the Company will at any time deposit any
Series C Preferred Stock if such Series C Preferred Stock is
required to be registered under the provisions of the
Securities Act and no registration statement is at such time
in effect as to such Series C Preferred Stock.
SECTION 5.07. Indemnification by the Company.
The Company agrees to indemnify the Depositary, any
Depositary's Agent and any Registrar against, and hold each
of them harmless from, any liability, costs and expenses
(including reasonable attorneys' fees) that may arise out of
or in connection with its acting as Depositary, Depositary's
Agent or Registrar, respectively, under this Deposit
Agreement and the Receipts, except for any liability arising
out of negligence, bad faith or willful misconduct on the
part of any such person or persons.
SECTION 5.08. Fees, Charges and Expenses. No
fees, charges and expenses of the Depositary or any
Depositary's Agent hereunder or of any Registrar shall be
payable by any person other than the Company, except for any
taxes and other governmental charges and except as provided
in this Deposit Agreement. If the Depositary incurs fees,
charges or expenses for which it is not otherwise liable
hereunder at the election of a holder of a Receipt or other
person, such holder or other person will be liable for such
fees, charges and expenses. All other fees, charges and
expenses of the Depositary and any Depositary's Agent
hereunder and of any Registrar (including, in each case,
reasonable fees and expenses of counsel) incident to the
performance of their respective obligations hereunder will
be paid from time to time upon consultation and agreement
between the Depositary and the Company as to the amount and
nature of such fees, charges and expenses.
ARTICLE VI
AMENDMENT AND TERMINATION
SECTION 6.01. Amendment. The form of the
Receipts and any provisions of this Deposit Agreement may at
any time and from time to time be amended by agreement
between the Company and the Depositary in any respect that
they may deem necessary or desirable. Any amendment that
shall impose any fees, taxes or charges payable by holders
of Receipts (other than taxes and other governmental
charges, fees and other expenses provided for herein or in
the Receipts), or that shall otherwise prejudice any
substantial existing right of holders of Receipts, shall not
become effective as to outstanding Receipts until the
expiration of 90 days after notice of such amendment shall
have been given to the record holders of outstanding
Receipts. Every holder of an outstanding Receipt at the
time any such amendment becomes effective shall be deemed,
by continuing to hold such Receipt, to consent and agree to
such amendment and to be bound by this Deposit Agreement as
amended thereby. In no event shall any amendment impair the
right, subject to the provisions of Sections 2.03, 2.06 and
2.07 and Article III, of any owner of any Depositary Shares
to surrender the Receipt evidencing such Depositary Shares
with instructions to the Depositary to deliver to the holder
the Series C Preferred Stock and all money and other
property, if any, represented thereby, except in order to
comply with mandatory provisions of applicable law.
SECTION 6.02. Termination. Whenever so directed
by the Company upon at least five Business Days' prior
notice, the Depositary will terminate this Deposit
Agreement, provided, that notice of such termination has
been given by mailing notice of such termination to the
record holders of all Receipts then outstanding at least
30 days prior to the date fixed in such notice for such
termination. The Depositary may likewise terminate this
Deposit Agreement if at any time 45 days shall have expired
after the Depositary shall have delivered to the Company a
written notice of its election to resign and a successor
depositary shall not have been appointed and accepted its
appointment as provided in Section 5.04.
If any Receipts shall remain outstanding after the
date of termination of this Deposit Agreement, the
Depositary thereafter shall discontinue the transfer of
Receipts, shall suspend the distribution of dividends to the
holders thereof and shall not give any further notices
(other than notice of such termination) or perform any
further acts under this Deposit Agreement, except as
hereinafter provided in this paragraph and except that the
Depositary shall continue to collect dividends and other
distributions pertaining to Series C Preferred Stock, shall
sell rights, preferences, privileges or other property as
provided in this Deposit Agreement and shall continue to
deliver the Series C Preferred Stock and any money and other
property represented by Receipts, without liability for
interest thereon, upon surrender thereof by the holders
thereof. At any time after the expiration of two years from
the date of termination, the Depositary may sell Series C
Preferred Stock then held hereunder at public or private
sale, at such place or places and upon such terms as it
deems proper and may thereafter hold the net proceeds of any
such sale, together with any money and other property held
by it hereunder, without liability for interest, for the
benefit, pro rata in accordance with their holdings, of the
holders of Receipts that have not theretofore been
surrendered. After making such sale, the Depositary shall
be discharged from all obligations under this Deposit
Agreement except to account for such net proceeds and money
and other property. Upon the termination of this Deposit
Agreement, the Company shall be discharged from all
obligations under this Deposit Agreement except for its
obligations to the Depositary, any Depositary's Agent and
any Registrar under Sections 5.07 and 5.08. In the event
this Deposit Agreement is terminated and a sufficient number
of shares of Series C Preferred Stock remain outstanding,
the Company hereby agrees to use its best efforts to list
the underlying Series C Preferred Stock on the New York
Stock Exchange, Inc. (unless the holders of a majority of
the outstanding shares of Series C Preferred Stock shall
consent to the Company not effecting such listing).
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. Counterparts. This Deposit
Agreement may be executed by the Company and the Depositary
in separate counterparts, each of which counterpart, when so
executed and delivered, shall be deemed an original, but all
such counterparts taken together shall constitute one and
the same instrument. Delivery of an executed counterpart of
a signature page to this Deposit Agreement by facsimile
transmission shall be effective as delivery of a manually
executed counterpart of this Deposit Agreement. Copies of
this Deposit Agreement shall be filed with the Depositary
and the Depositary's Agents and shall be open to inspection
during business hours at the Corporate Office and the
respective offices of the Depositary's Agents, if any, by
any holder of a Receipt.
SECTION 7.02. Exclusive Benefits of Parties.
This Deposit Agreement is for the exclusive benefit of the
parties hereto, and their respective successors hereunder,
and shall not be deemed to give any legal or equitable
right, remedy or claim to any other person whatsoever.
SECTION 7.03. Invalidity of Provisions. In case
any one or more of the provisions contained in this Deposit
Agreement or in the Receipts should be or become invalid,
illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions
contained herein or therein shall in no way be affected,
prejudiced or disturbed thereby.
SECTION 7.04. Notices. Any notices to be given
to the Company hereunder or under the Receipts shall be in
writing and shall be deemed to have been duly given if
personally delivered or sent by mail or by facsimile
transmission confirmed by letter, addressed to the Company
at 55 East Camperdown Way, Post Office Box 1028, Greenville,
South Carolina 29602, Attention: Treasurer, with a copy to
Corporate Secretary, or at any other place to which the
Company may have transferred its principal executive office.
Any notices to be given to the Depositary
hereunder or under the Receipts shall be in writing and
shall be deemed to have been duly given if personally
delivered or sent by mail, or by telegram or telex or
telecopier confirmed by letter, addressed to the Depositary
at the Corporate Office.
Any notices given to any record holder of a
Receipt hereunder or under the Receipts shall be in writing
and shall be deemed to have been duly given if personally
delivered or sent by mail, or by telegram or telex or
telecopier confirmed by letter, addressed to such record
holder at the most recent address of such record holder as
it appears on the books of the Depositary or, if such holder
shall have timely filed with the Depositary a written
request that notices intended for such holder be mailed to
some other address, at the address designated in such
request.
Delivery of a notice sent by mail, or by telegram
or telex or telecopier, shall be deemed to be effected at
the time when a duly addressed letter containing the same
(or a duly addressed letter confirming an earlier notice in
the case of a facsimile transmission, telegram or telex) is
deposited, postage prepaid, in a post office letter box.
The Depositary or the Company may, however, act upon any
facsimile transmission received by it from the other or from
any holder of a Receipt, notwithstanding that such facsimile
transmission shall not subsequently be confirmed by letter
as aforesaid.
SECTION 7.05. Depositary's Agents. The
Depositary may from time to time appoint Depositary's Agents
to act in any respect for the Depositary for the purposes of
this Deposit Agreement and may at any time appoint
additional Depositary's Agents and vary or terminate the
appointment of such Depositary's Agents. The Depositary
will notify the Company of any such action.
SECTION 7.06. Holders of Receipts Are Parties.
Notwithstanding that holders of Receipts have not executed
and delivered this Deposit Agreement or any counterpart
thereof, the holders of Receipts from time to time shall be
deemed to be parties to this Deposit Agreement and shall be
bound by all of the terms and conditions hereof and of the
Receipts by acceptance of delivery of Receipts.
SECTION 7.07. Governing Law. This Deposit
Agreement and the Receipts and all rights hereunder and
thereunder and provisions hereof and thereof shall be
governed by, and construed in accordance with, the law of
the State of New York without giving effect to principles of
conflict of laws.
SECTION 7.08. Headings. The headings of articles
and sections in this Deposit Agreement and in the form of
the Receipt set forth in Exhibit A hereto have been inserted
for convenience only and are not to be regarded as a part of
this Deposit Agreement or the Receipts or to have any
bearing upon the meaning or interpretation of any provision
contained herein or in the Receipts.
IN WITNESS WHEREOF, Bowater Incorporated and Trust
Company Bank have duly executed this agreement as of the day
and year first above set forth and all holders of Receipts
shall become parties hereto by and upon acceptance by them
of delivery of Receipts executed and delivered in accordance
with the terms hereof.
BOWATER INCORPORATED,
By /s/ David G. Maffucci
_________________________
Name: David G. Maffucci
Title: Vice President -
Treasurer
TRUST COMPANY BANK,
as Depositary,
By /s/ T.J. Donaldson
________________________
Name: T.J. Donaldson
Title: Group Vice President
EXHIBIT A
DEPOSITARY RECEIPT
FOR
DEPOSITARY SHARES,
EACH REPRESENTING ONE-FOURTH OF A SHARE OF
8.40% SERIES C CUMULATIVE PREFERRED STOCK,
par value $1 per share
OF
BOWATER INCORPORATED
(Incorporated under the Laws of the State of Delaware)
No. Depositary Shares
CUSIP
Trust Company Bank, as Depositary (the
"Depositary"), hereby certifies that ___________________ is
the registered owner of __________ Depositary Shares (the
"Depositary Shares"), each Depositary Share representing
one-fourth of a share of 8.40% Series C Cumulative Preferred
Stock, par value $1 per share (the "Series C Preferred
Stock"), of Bowater Incorporated, a corporation duly
organized and existing under the laws of the State of
Delaware (the "Company"), and the same proportionate
interest in any and all other property received by the
Depositary in respect of such shares of Series C Preferred
Stock and held by the Depositary under the Deposit Agreement
(as defined below). Subject to the terms of the Deposit
Agreement, each owner of a Depositary Share is entitled,
proportionately, to all the rights, preferences and
privileges of the Series C Preferred Stock represented
thereby, including the dividend, voting, liquidation and
other rights contained in the Certificate of Designations of
the 8.40% Series C Cumulative Preferred Stock, par value $1
per share, establishing the rights, preferences, privileges
and limitations of the Series C Preferred Stock (the
"Certificate of Designations"), copies of which are on file
at the office of the Depositary at which at any particular
time its business in respect of matters governed by the
Deposit Agreement shall be administered, which at the time
of the execution of the Deposit Agreement is located at One
Park Place, Atlanta, Georgia (the "Corporate Office").
THE DEPOSITARY IS NOT RESPONSIBLE FOR THE VALIDITY OF ANY
DEPOSITED STOCK. THE DEPOSITARY ASSUMES NO RESPONSIBILITY
FOR THE CORRECTNESS OF THE DESCRIPTION SET FORTH IN THIS
RECEIPT, WHICH CAN BE TAKEN AS A STATEMENT OF THE COMPANY
SUMMARIZING CERTAIN PROVISIONS OF THE DEPOSIT AGREEMENT.
UNLESS EXPRESSLY SET FORTH IN THE DEPOSIT AGREEMENT, THE
DEPOSITARY MAKES NO WARRANTIES OR REPRESENTATIONS AS TO THE
VALIDITY, GENUINENESS OR SUFFICIENCY OF ANY STOCK AT ANY
TIME DEPOSITED WITH THE DEPOSITARY UNDER THE DEPOSIT
AGREEMENT OR OF THE DEPOSITARY SHARES OR RECEIPTS (EXCEPT
FOR ITS COUNTERSIGNATURES THEREON), AS TO THE VALIDITY OR
SUFFICIENCY OF THE DEPOSIT AGREEMENT, AS TO THE VALUE OF THE
DEPOSITARY SHARES OR AS TO ANY RIGHT, TITLE OR INTEREST OF
THE RECORD HOLDERS OF THE RECEIPTS IN AND TO THE DEPOSITARY
SHARES.
The Company will furnish to any holder of a
Receipt without charge, upon request addressed to its
executive office or the office of its transfer agent, a
statement or summary of the powers, designations,
preferences and relative, participating, optional or other
special rights of each authorized class of capital stock of
the Company, and of each series of preferred stock of the
Company authorized to be issued, so far as the same may have
been fixed, and of the qualifications, limitations or
restrictions of such preferences and/or rights.
This Depositary Receipt (the "Receipt") is
continued on the reverse hereof and the additional
provisions therein set forth for all purposes have the same
effect as if set forth at this place.
This Receipt shall not be entitled to any benefits
under the Deposit Agreement or be valid or obligatory for
any purpose, unless this Receipt shall have been executed on
behalf of the Company by the manual or facsimile signature
of a duly authorized officer and executed manually or, if a
Registrar for the Receipts (other than the Depositary) shall
have been appointed, by facsimile by the Depositary by the
signature of a duly authorized officer and, if executed by
facsimile signature of the Depositary, shall have been
countersigned manually by such Registrar by the signature of
a duly authorized officer.
Dated:
TRUST COMPANY BANK
Depositary and Registrar
By____________________________
Authorized Officer
BOWATER INCORPORATED
By____________________________
Authorized Officer
[FORM OF REVERSE
OF DEPOSITARY RECEIPT]
1. The Deposit Agreement. Depositary Receipts
(the "Receipts"), of which this Receipt is one, are made
available upon the terms and conditions set forth in the
Deposit Agreement, dated as of February 1, 1994 (the
"Deposit Agreement") among the Company, the Depositary and
all holders from time to time of Receipts. The Deposit
Agreement (copies of which are on file at the Corporate
Office and at the office of any Agent of the Depositary)
sets forth the rights of holders of Receipts and the rights
and duties of the Depositary. The statements made on the
face and the reverse of this Receipt are summaries of
certain provisions of the Deposit Agreement and are subject
to the detailed provisions thereof, to which reference is
hereby made. In the event of any conflict between the
provisions of this Receipt and the provisions of the Deposit
Agreement, the provisions of the Deposit Agreement will
govern.
2. Definitions. Unless otherwise expressly
herein provided, all defined terms used herein shall have
the meanings ascribed thereto in the Deposit Agreement.
3. Redemption of Series C Preferred Stock for
Cash. Whenever the Company shall elect to redeem shares of
Series C Preferred Stock for cash in accordance with the
Certificate of Designations, it shall (unless otherwise
agreed in writing with the Depositary) give the Depositary
in its capacity as Depositary not less than 40 nor more than
70 days' notice of the date of such proposed redemption of
Series C Preferred Stock. The Depositary shall mail, first
class postage prepaid, notice of such redemption and the
proposed simultaneous redemption of the number of Depositary
Shares representing the Series C Preferred Stock to be
redeemed, not less than 30 and not more than 60 days prior
to the date fixed for redemption of such Series C Preferred
Stock and Depositary Shares (the "Redemption Date"), to the
record holders of the Receipts evidencing the Depositary
Shares to be so redeemed, at the addresses of such holders
as they appear on the records of the Depositary; but neither
failure to mail any such notice to one or more such holders
nor any defect in any notice to one or more such holders
shall affect the sufficiency of the proceedings for
redemption as to other holders. Each such notice shall
state: (i) the Redemption Date; (ii) the number of
Depositary Shares to be redeemed and, if less than all the
Depositary Shares held by any such holder are to be
redeemed, the number of such Depositary Shares held by such
holder to be so redeemed; (iii) the redemption price;
(iv) the place or places where Receipts evidencing
Depositary Shares are to be surrendered for payment of the
redemption price; and (v) that dividends in respect of the
shares of Series C Preferred Stock represented by the
Depositary Shares to be redeemed will cease to accumulate on
such Redemption Date. Any such notices shall be mailed in
the same manner as notices of redemption of the Series C
Preferred Stock are required to be mailed pursuant to
paragraph 3 of the Certificate of Designations and published
in the same manner as notices of redemption of the Series C
Preferred Stock are required to be published pursuant to
said paragraph, if so required. In case fewer than all the
outstanding Depositary Shares are to be redeemed, the
Depositary Shares to be redeemed shall be selected by lot or
pro rata (as nearly as may be) or by any other equitable
method determined by the Depositary to be consistent with
the method determined by the Board of Directors of the
Company with respect to the Series C Preferred Stock.
Notice having been mailed and published by the
Depositary as aforesaid, from and after the Redemption Date
(unless the Company shall have failed to redeem the shares
of Series C Preferred Stock to be redeemed by it, as set
forth in the Company's notice provided for above), the
Depositary Shares called for redemption shall be deemed no
longer to be outstanding and all rights of the holders of
Receipts evidencing such Depositary Shares (except the right
to receive the redemption price) shall, to the extent of
such Depositary Shares, cease and terminate. Upon surrender
in accordance with said notice of the Receipts evidencing
such Depositary Shares (properly endorsed or assigned for
transfer, if the Depositary shall so require), such
Depositary Shares shall be redeemed at a redemption price
per Depositary Share equal to one-fourth of the redemption
price per share paid in respect of the shares of Series C
Preferred Stock plus all money and other property, if any,
represented by such Depositary Shares, including all amounts
paid by the Company in respect of dividends which on the
redemption date have accrued on the shares of Series C
Preferred Stock to be so redeemed and have not theretofore
been declared or paid. The foregoing shall be subject
further to the terms and conditions of the Certificate of
Designations and the Deposit Agreement.
If fewer than all of the Depositary Shares
evidenced by this Receipt are called for redemption, the
Depositary will deliver to the holder of this Receipt upon
its surrender to the Depositary, together with the
redemption payment, a new Receipt evidencing the Depositary
Shares evidenced by such prior Receipt and not called for
redemption.
4. Surrender of Receipts and Withdrawal of Series
C Preferred Stock. Upon surrender of this Receipt to the
Depositary at the Corporate Office or such other offices as
the Depositary may designate, and subject to the provisions
of the Deposit Agreement, the holder hereof is entitled to
withdraw, and to obtain delivery of, to or upon the order of
such holder, any or all of the Series C Preferred Stock (but
only in whole shares of Series C Preferred Stock) and any or
all money and other property, if any, at the time
represented by the Depositary Shares evidenced by this
Receipt; provided, however, that, in the event this Receipt
shall evidence a number of Depositary Shares in excess of
the number of Depositary Shares representing the whole
number of shares of Series C Preferred Stock to be
withdrawn, the Depositary shall, in addition to such whole
number of shares of Series C Preferred Stock and such money
and other property, if any, to be withdrawn, deliver, to or
upon the order of such holder, a new Receipt or Receipts
evidencing such excess number of whole Depositary Shares.
5. Transfers, Split-ups, Combinations. Subject
to Paragraphs 6, 7 and 8 below, this Receipt is transferable
on the books of the Depositary upon surrender of this
Receipt to the Depositary at the Corporate Office or such
other offices as the Depositary may designate, properly
endorsed or accompanied by a properly executed instrument of
transfer or endorsement, and upon such transfer the
Depositary shall sign and deliver a Receipt to or upon the
order of the person entitled thereto, all as provided in and
subject to the Deposit Agreement. This Receipt may be split
into other Receipts or combined with other Receipts into one
Receipt evidencing the same aggregate number of Depositary
Shares evidenced by the Receipt or Receipts surrendered;
provided, however, that the Depositary shall not execute and
deliver any Receipt evidencing a fractional Depositary
Share.
6. Conditions to Signing and Delivery, Transfer,
etc., of Receipts. Prior to the execution and delivery,
transfer, split-up, combination, surrender or exchange of
this Receipt, the Depositary, any of the Depositary's Agents
or the Company may require any or all of the following:
(i) payment to it of a sum sufficient for the payment (or,
in the event that the Depositary or the Company shall have
made such payment, the reimbursement to it) of any tax or
other governmental charge with respect thereto (including
any such tax or charge with respect to Series C Preferred
Stock being deposited or withdrawn); (ii) the production of
proof satisfactory to it as to the identity and genuineness
of any signature; and (iii) compliance with such
regulations, if any, as the Depositary or the Company may
establish not inconsistent with the Deposit Agreement. Any
person presenting Series C Preferred Stock for deposit, or
any holder of this Receipt, may be required to file such
proof of information, to execute such certificates and to
make such representations and warranties as the Depositary
or the Company may reasonably deem necessary or proper. The
Depositary or the Company may withhold or delay the delivery
of any Receipt, the transfer, redemption or exchange of any
Receipt, the withdrawal of the Series C Preferred Stock or
money or other property, if any, represented by the
Depositary Shares evidenced by this Receipt or the
distribution of any dividend or other distribution until
such proof or other information is filed, such certificates
are executed or such representations and warranties are
made.
7. Suspension of Delivery, Transfer, etc. The
deposit of Series C Preferred Stock may be refused, the
delivery of this Receipt against Series C Preferred Stock
may be suspended, and the transfer, split-up, combination,
surrender or exchange of this Receipt may be suspended
(i) during any period when the register of holders of
Receipts is closed, (ii) if any such action is deemed
necessary or advisable by the Depositary, any of the
Depositary's Agents or the Company at any time or from time
to time because of any requirement of law or of any
government or governmental body or commission, or under any
provision of the Deposit Agreement, or (iii) with the
approval of the Company, for any other reason. The
Depositary shall not be required (a) to execute and deliver,
transfer or exchange any Receipts for a period beginning at
the opening of business 15 days next preceding any selection
of Depositary Shares and Series C Preferred Stock to be
redeemed and ending at the close of business on the day of
the mailing of notice of redemption of Depositary Shares or
(b) to transfer or exchange for another Receipt any Receipt
evidencing Depositary Shares called or being called for
redemption in whole or in part, except as provided in the
last sentence of Paragraph 3 above.
8. Payment of Taxes or Other Governmental
Charges. If any tax or other governmental charge shall
become payable by or on behalf of the Depositary with
respect to this Receipt, the Depositary Shares evidenced by
this Receipt, the Series C Preferred Stock (or any
fractional interest therein) represented by such Depositary
Shares or any transaction referred to in Section 4.06 of the
Deposit Agreement, such tax (including transfer, issuance or
acquisition taxes, if any) or governmental charge shall be
payable by the holder hereof. Until such payment is made,
transfer, redemption or exchange of this Receipt or any
withdrawal of the Series C Preferred Stock or money and
other property, if any, represented by the Depositary Shares
evidenced by this Receipt may be refused, any dividend or
other distribution may be withheld and any part or all of
the Series C Preferred Stock or other property represented
by the Depositary Shares evidenced by this Receipt may be
sold for the account of the holder hereof (after attempting
by reasonable means to notify such holder prior to such
sale). Any dividend or other distribution so withheld and
the proceeds of any such sale may be applied to any payment
of such tax or other governmental charge, the holder of this
Receipt remaining liable for any deficiency.
9. Amendment. The form of the Receipts and any
provision of the Deposit Agreement may at any time and from
time to time be amended by agreement between the Company and
the Depositary in any respect that they may deem necessary
or desirable. Any amendment that shall impose any fees,
taxes or charges payable by holders of Receipts (other than
taxes and other governmental charges, fees and other
expenses provided for herein or in the Deposit Agreement),
or that shall otherwise prejudice any substantial existing
right of holders of Receipts, shall not become effective as
to outstanding Receipts until the expiration of 90 days
after notice of such amendment shall have been given to the
record holders of outstanding Receipts. The holder of this
Receipt at the time any such amendment becomes effective
shall be deemed, by continuing to hold this Receipt, to
consent and agree to such amendment and to be bound by the
Deposit Agreement as amended thereby. In no event shall any
amendment impair the right, subject to the provisions of
Paragraphs 3, 4, 6, 7 and 8 hereof and of Sections 2.03,
2.06 and 2.07 and Article III of the Deposit Agreement, of
the owner of the Depositary Shares evidenced by this Receipt
to surrender this Receipt with instructions to the
Depositary to deliver to the holder the Series C Preferred
Stock and all money and other property, if any, represented
hereby, except in order to comply with mandatory provisions
of applicable law.
10. Fees, Charges and Expenses. The Company will
pay all fees, charges and expenses of the Depositary, except
for taxes (including transfer taxes, if any) and other
governmental charges and such charges as are expressly
provided in the Deposit Agreement to be at the expense of
persons depositing Series C Preferred Stock, holders of
Receipts or other persons.
11. Title to Receipts. It is a condition of this
Receipt, and every successive holder hereof by accepting or
holding the same consents and agrees, that title to this
Receipt (and to the Depositary Shares evidenced hereby) when
properly endorsed or accompanied by a properly executed
instrument of transfer or endorsement, is transferable by
delivery; provided, however, that until this Receipt shall
be transferred on the books of the Depositary as provided in
Section 2.04 of the Deposit Agreement, the Depositary may,
notwithstanding any notice to the contrary, treat the record
holder hereof at such time as the absolute owner hereof for
the purpose of determining the person entitled to
distribution of dividends or other distributions or to any
notice provided for in the Deposit Agreement and for all
other purposes.
12. Dividends and Distributions. Whenever the
Depositary receives any cash dividend or other cash
distribution on the Series C Preferred Stock, the Depositary
will, subject to the provisions of the Deposit Agreement,
distribute such portions of such sum to record holders of
Receipts as are, as nearly as practicable, proportionate to
the respective numbers of Depositary Shares evidenced by the
Receipts held by such holders; provided, however, that in
case the Company or the Depositary shall be required to
withhold and does withhold from any cash dividend or other
cash distribution in respect of the Series C Preferred Stock
an amount on account of taxes or as otherwise required by
law, regulation or court order, the amount made available
for distribution or distributed in respect of Depositary
Shares shall be reduced accordingly. The Depositary shall
distribute or make available for distribution, as the case
may be, only such amount, however, as can be distributed
without attributing to any owner of Depositary Shares a
fraction of one cent and any balance not so distributable
shall be held by the Depositary (without liability for
interest thereon) and shall be added to and be treated as
part of the next sum received by the Depositary for
distribution to record holders of Receipts then outstanding.
13. Subscription Rights, Preferences or
Privileges. If the Company shall at any time offer or cause
to be offered to the persons in whose names Series C
Preferred Stock is registered on the books of the Company
any rights, preferences or privileges to subscribe for or to
purchase any securities or any rights, preferences or
privileges of any other nature, such rights, preferences or
privileges shall in each such instance, subject to the
provisions of the Deposit Agreement, be made available by
the Depositary to the record holders of Receipts if the
Company so directs in such manner as the Company shall
instruct.
14. Notice of Dividends, Fixing of Record Date.
Whenever any cash dividend or other cash distribution shall
become payable, any distribution other than cash shall be
made, or any rights, preferences or privileges shall at any
time be offered, with respect to the Series C Preferred
Stock, or the Depositary shall receive notice of (i) any
meeting at which holders of Series C Preferred Stock are
entitled to vote or of which holders of Series C Preferred
Stock are entitled to notice or (ii) any election on the
part of the Company to call for redemption any shares of
Series C Preferred Stock, the Depositary shall in each such
instance fix a record date (which shall be the same date as
the record date fixed by the Company with respect to the
Series C Preferred Stock) for the determination of the
holders of Receipts (i) who shall be entitled to receive
such dividend, distribution, rights, preferences or
privileges or the net proceeds of the sale thereof, or to
give instructions for the exercise of voting rights at any
such meeting or to receive notice of such meeting or
(ii) whose Depositary Shares are to be so redeemed.
15. Voting Rights. Upon issuance of notice of any
meeting at which the holders of Series C Preferred Stock are
entitled to vote, the Company shall direct the Depositary,
as soon as practicable thereafter, to mail to the record
holders of Receipts a notice, which shall contain (i) such
information as is contained in such notice of meeting,
(ii) a statement that the holders of Receipts at the close
of business on a specified record date determined as
provided in Paragraph 14 will be entitled, subject to any
applicable provision of law, the Certificate of
Incorporation or the Certificate of Designations, to
instruct the Depositary as to the exercise of the voting
rights pertaining to the amount of Series C Preferred Stock
represented by their respective Depositary Shares, and
(iii) a brief statement as to the manner in which such
instructions may be given. Upon the written request of a
holder of a Receipt on such record date, the Depositary
shall endeavor insofar as practicable to vote or cause to be
voted the amount of Series C Preferred Stock represented by
the Depositary Shares evidenced by such Receipt in
accordance with the instructions set forth in such request.
The Company has agreed to take all reasonable action that
may be deemed necessary by the Depositary in order to enable
the Depositary to vote such Series C Preferred Stock or
cause such Series C Preferred Stock to be voted. In the
absence of specific instructions from the holder of a
Receipt, the Depositary will abstain from voting to the
extent of the Series C Preferred Stock represented by the
Depositary Shares evidenced by such Receipt. After
aggregating all voting Depositary Shares, the Depositary
will disregard for voting purposes any fractional share of
Series C Preferred Stock remaining.
16. Reports, Inspection of Transfer Books. The
Depositary shall make available for inspection by holders of
Receipts at the Corporate Office and at such other places as
it may from time to time deem advisable during normal
business hours any reports and communications received from
the Company that are both received by the Depositary as the
holder of Series C Preferred Stock and made generally
available to the holders of Series C Preferred Stock by the
Company. The Depositary shall keep books at the Corporate
Office for the registration and transfer of Receipts, which
books during normal business hours will be open for
inspection by the record holders of Receipts as provided by
applicable law.
17. Liability of the Depositary, the Depositary's
Agents and the Company. Neither the Depositary nor any
Depositary's Agent nor the Company shall incur any liability
to any holder of any Receipt, if by reason of any provision
of any present or future law or regulation of any
governmental authority or, in the case of the Depositary or
the Depositary's Agent, by reason of any provision, present
or future, of the Certificate of Incorporation or the
Certificate of Designations or, in the case of the Company,
the Depositary or the Depositary's Agent, by reason of any
act of God or war or other circumstance beyond the control
of the relevant party, the Depositary, any Depositary's
Agent or the Company shall be prevented or forbidden from
doing or performing any act or thing that the terms of the
Deposit Agreement provide shall be done or performed; nor
shall the Depositary, any Depositary's Agent or the Company
incur any liability to any holder of a Receipt by reason of
any nonperformance or delay, caused as aforesaid, in the
performance of any act or thing that the terms of the
Deposit Agreement provide shall or may be done or performed
or by reason of any exercise of, or failure to exercise, any
discretion provided for in the Deposit Agreement.
18. Obligations of the Depositary, the
Depositary's Agents and the Company. Neither the Depositary
nor any Depositary's Agent nor the Company assumes any
obligation or shall be subject to any liability hereunder or
under the Deposit Agreement to holders of Receipts other
than that each of them agrees to use good faith in the
performance of such duties as are specifically set forth in
the Deposit Agreement.
Neither the Depositary nor any Depositary's Agent
nor the Company shall be under any obligation to appear in,
prosecute or defend any action, suit or other proceeding
with respect to Series C Preferred Stock, Depositary Shares
or Receipts that in its opinion may involve it in expense or
liability, unless indemnity satisfactory to it against all
expense and liability be furnished as often as may be
required.
Neither the Depositary nor any Depositary's Agent
nor the Company will be liable for any action or failure to
act by it in reliance upon the advice of or information from
legal counsel, accountants, any person presenting Series C
Preferred Stock for deposit, any holder of a Receipt or any
other person believed by it in good faith to be competent to
give such advice or information.
19. Termination of Deposit Agreement. Whenever so
directed by the Company upon at least five Business Days'
prior notice, the Depositary will terminate the Deposit
Agreement, provided, that notice of such termination has
been given by mailing notice of such termination to the
record holders of all Receipts then outstanding at least
30 days prior to the date fixed in such notice for such
termination. The Depositary may likewise terminate the
Deposit Agreement if at any time 45 days shall have expired
after the Depositary shall have delivered to the Company a
written notice of its election to resign and a successor
depositary shall not have been appointed and accepted its
appointment as provided in Section 5.04 of the Deposit
Agreement. Upon the termination of the Deposit Agreement,
the Company shall be discharged from all obligations
thereunder except for its obligations to the Depositary, any
Depositary's Agent and any Registrar under Sections 5.07 and
5.08 of the Deposit Agreement.
If any Receipts remain outstanding after the date
of termination, the Depositary thereafter shall discontinue
all functions and be discharged from all obligations as
provided in the Deposit Agreement, except as specifically
provided therein.
20. Governing Law. The Deposit Agreement and this
Receipt and all rights thereunder and hereunder and
provisions thereof and hereof shall be governed by, and
construed in accordance with, the law of the State of New
York without giving effect to principles of conflict of
laws.
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sells,
assigns and transfers unto ____________ the within Receipt
and all rights and interests represented by the Depositary
Shares evidenced thereby, and hereby irrevocably constitutes
and appoints ________________ his attorney, to transfer the
same on the books of the within-named Depositary, with full
power of substitution in the premises.
Dated: Signature:_________________________
NOTE: The signature on this assignment
must correspond with the name as written
upon the face of the Receipt in every
particular, without alteration or
enlargement, or any change whatsoever,
and must be guaranteed by a commercial
bank, trust company, securities broker or
dealer, credit union, savings association
or other eligible guarantor institution
which is a member of or participant in a
signature guarantee program acceptable to
the Depositary.
