As filed with the Securities and Exchange Commission on April 26, 2000
Registration No. 333-
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------------
Form S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
----------------------------
PAINE WEBBER GROUP INC.
(Exact name of registrant as specified in its charter)
Delaware 13-2760086
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1285 Avenue of the Americas
New York, New York 10019
(Address of principal executive offices, including zip code)
-----------------------------
PAINE WEBBER GROUP INC. 6.25% CONVERTIBLE DEBENTURES DUE 2007 IN
CONNECTION WITH THE 2000 KEEP PROGRAM
(Full title of the plan)
Theodore A. Levine
Senior Vice President, General Counsel and Secretary
Paine Webber Group Inc.
1285 Avenue of the Americas
New York, New York 10019
(Name and address of agent for service)
(212) 713-2879
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
Proposed Proposed Amount
Title of Securities Amount to be Maximum Maximum of
to be Registered Registered Offering Price Aggregate Offering Registration Fee
Per Share Price(1)
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value 2,000,000 Issuable Upon Not Applicable Not Applicable
$1.00 per share Conversion
- ------------------------------------------------------------------------------------------------------
Series A Convertible 2,000,000 Issuable Upon Not Applicable Not Applicable
Redeemable Preferred Conversion
Stock
- ------------------------------------------------------------------------------------------------------
6.25% Convertible $76,375,000 100% of the $76,375,000 $20,163
Debentures Due Face Amount
January 20, 2007
- ------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee
pursuant to Rule 457(i) under the Securities Act of 1933, as amended
(the "Securities Act").
<PAGE>
Part I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information.*
Item 2. Registration Information and Employee Plan Annual Information.*
- --------
o Information required by Part I to be contained in the Section 10(a)
prospectus is omitted from this Registration Statement in accordance
with Rule 428 under the Securities Act, and the "Note" to Part I of
Form S-8.
<PAGE>
Part II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents that Paine Webber Group Inc. (the
"Registrant") has filed with the Securities and Exchange Commission (the
"Commission") are incorporated in this Form S-8 Registration Statement (the
"Registration Statement")by reference and made a part hereof:
(a) the Registrant's latest Annual Report on Form 10-K
filed pursuant to Section 13 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act");
(b) the Registrant's latest Quarterly Reports on Form
10-Q filed pursuant to Section 13 of the Exchange Act;
(c) the Registrant's Current Reports on Form 8-K filed
pursuant to Section 13 of the Exchange Act;
(d) the Registrant's definitive proxy statement or
information statements filed pursuant to Section 14 of the Exchange Act
in connection with Registrant's latest annual meeting of shareholders and
any definitive proxy or information statements as filed in connection
with any subsequent special meetings of its stockholders; and
(e) the description of the Registrant's common stock
contained in the Registrant's Registration Statement on Form 8-A filed
under Section 12 of the Exchange Act, including Amendment No. 4 thereto
dated January 30, 1986, and any other amendment or report filed under the
Exchange Act for the purpose of updating such description.
All documents that the Registrant files pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act subsequent to the effective date
of this Registration Statement, but prior to the filing of a post-effective
amendment to this Registration Statement indicating that all securities offered
hereby have been sold or deregistering all securities then remaining unsold,
shall be deemed to be incorporated by reference herein and to be a part hereof
from the date of filing of such documents.
Any statement contained herein or in any document incorporated
or deemed to be incorporated by reference herein shall be deemed to be modified
or superseded for purposes of this Registration Statement to the extent that a
statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed to constitute a part of this Registration Statement, except as so
modified or superseded.
3
<PAGE>
Item 4. Description of Securities.
Debentures
The 6.25% Convertible Debentures (the "Debentures") will be
unsecured obligations of the Registrant, will be limited to $76,375,000
aggregate principal amount and will mature on January 20, 2007 (if not
previously converted or redeemed as described below). The Debentures will bear
interest from January 20, 2000 at a rate of 6.25% per annum until paid in full.
Interest will be payable semi-annually on the last days of June and December,
commencing June 30, 2000, until maturity. The Debentures will be convertible
into 2,000,000 shares of Series A Convertible Redeemable Preferred Stock (the
"Preferred Stock"), which has $38.1875 per share liquidation value. The
Preferred Stock is immediately convertible into 2,000,000 shares of Common
Stock, $1.00 par value (the "Common Stock").
Preferred Stock
The Preferred Stock will have a liquidation value of $38.1875
per share and will be immediately convertible into Common Stock at an initial
price of $38.1875 per share, subject to adjustment for capital changes, noncash
distributions on Common Stock and distributions to holders of Common Stock of
rights to purchase Common Stock at a price below its current market price. The
annual dividend of $ 0.48 on each share of Preferred Stock will be cumulative
from the date of issuance and will be payable in quarterly installments on the
last days of March, June, September and December, when and as declared.
Shares of Preferred Stock may be redeemed by the Registrant at
any time, in whole but not in part, upon not less than 25 days' notice, at a
redemption price of $38.1875 per share plus accrued dividends. Any shares of
Preferred Stock called for redemption may be converted, as described above,
until the redemption date.
Holders of shares of Preferred Stock will be entitled to
receive the liquidation value of $38.1875 per share, plus accrued dividends,
upon any liquidation, dissolution or winding up of the Registrant, whether
voluntary or involuntary, before any distribution of the assets of the
Registrant to holders of Common Stock and ratably with holders of all other
shares of Series Preferred Stock of the Registrant ("Series Preferred Stock").
Holders of shares of Preferred Stock will have no voting rights except as
provided by law or when dividends payable on the Preferred Stock are in arrears
in an amount equivalent to three full semi-annual dividends. In the latter
event, the holders of shares of Preferred Stock, together with the holders of
other Series Preferred Stock, may elect two additional directors of the
Registrant. Holders of shares of Preferred Stock will have no preemptive rights.
Transfer Restrictions
The Debentures and the Preferred Stock may not be sold,
pledged, transferred or otherwise disposed of except by will or pursuant to the
laws of descent and distribution or as security for funds to finance the
investor's purchase of a Debenture.
4
<PAGE>
Conversion
While an investor is employed by the Registrant, his Debenture
will become convertible into Preferred Stock on or after January 20, 2003 at the
Preferred Stock liquidation value of $38.1875. Such conversion will be effective
as of the date the notice of conversion is provided to the Registrant. In the
event the Registrant has previously given a 60-day prior written notice of
redemption, the investor may elect to convert prior to the redemption date and
such conversion will be effectuated as of the date set forth in the notice of
conversion as long as the investor remains employed as of such date. However,
under certain circumstances described below, the investor may convert the
Debenture regardless of how long it had been held at a conversion price of
$38.1875.
Redemption
On and after January 20, 2004, the Debenture may be redeemed
by the Registrant at its principal amount plus accrued interest (to the extent
not previously redeemed or converted) upon giving 60 days prior written notice
and such redemption will be effective at the end of such 60 day period. However,
if the investor is entitled to convert the Debenture, he may elect to do so
following the receipt of such notice of redemption from the Registrant and such
conversion will be effective as of the date of such notice of conversion as long
as such notice is provided to the Registrant prior to the date the redemption
was to occur.
Change in Control Conversion or Redemption
In the event that prior to January 20, 2003, (i) the
Registrant enters into an agreement, (ii) the Board of Directors of the
Registrant approves a transaction, or (iii) there is a tender offer, which in
either case, might result in a change in control, the investor may elect to have
the Debenture converted even if his employment is terminated other than for
cause or the Registrant may elect to redeem such Debenture prior to the
effective time of the change in control and such conversion or redemption will
be effective as of the effective time of the change in control. However, if the
Registrant elects to redeem the Debenture prior to the investor's election to
convert, the investor may still elect to convert such Debenture rather than
having the Registrant redeem it as long as the investor provides a notice of
conversion prior to the effective time of the change in control. In the event
the Debenture is not redeemed or converted prior to the change in control which
occurs prior to January 20, 2003, such Debenture shall become fully convertible
following the change in control but the Registrant may not redeem such Debenture
until on or after January 20, 2004. Any conversion or redemption following a
change in control will be implemented in accordance with the procedures
described in the Debenture. In the event that the change in control does not
become effective, any election to convert or redeem will not be effectuated
unless the Debenture otherwise becomes convertible or redeemable as described in
the Debenture.
In the event that on or after January 20, 2003, (i) the
Registrant enters into an agreement, (ii) the Board of Directors of the
Registrant approves a transaction, or (iii) there is a tender offer, which in
either case, might result in a change in control, the Debenture will remain
convertible in accordance with the procedures described in the Debentures even
if the investor's employment is terminated other than for cause. However the
Registrant may elect to redeem such Debenture prior to such change in control
which occurs on or after January 20, 2003.
5
<PAGE>
However, if the Registrant elects to redeem the Debenture prior to the
investor's election to convert, the investor may still elect to convert such
Debenture rather than having the Registrant redeem it as long as the investor
provides a notice of conversion prior to the effective time of the change in
control. In the event the Debenture is not redeemed or converted prior to the
change in control which occurs on or after January 20, 2003 or such change in
control does not occur, such Debenture shall remain fully convertible to the
extent such Debenture remains outstanding following the change in control but
the Registrant may not redeem such Debenture until on or after January 20, 2004
in accordance with the procedures described in the Debenture.
Events of Default
Events of default under a Debenture include the following: (i)
nonpayment of principal when due; (ii) nonpayment of' interest for ten business
days after it is due; (iii) material inaccuracy of any representation or
warranty by the Registrant in the Purchase Agreement; (iv) failure by the
Registrant, for 30 days after receipt of notice, to perform or observe in any
material respect any other term, covenant or agreement in the Debenture or the
Purchase Agreement; and (v) occurrence of certain events of bankruptcy or
insolvency involving the Registrant or PaineWebber Incorporated, including
commencement of a voluntary or involuntary proceeding under the federal
bankruptcy laws. If any event of default occurs and is continuing, the holder of
any Debenture may declare his Debenture to be due and payable immediately.
Termination for Cause
If the investor is terminated for cause, his Debenture will
cease to be convertible as of the date of such termination and the Registrant
will redeem it at the principal amount, plus accrued interest as of such date of
termination.
Termination Without Cause or Voluntary Terminations
If the investor is terminated without cause or the investor
incurs a voluntary termination, to the extent that the Debenture is vested at
the date of termination, such Debenture shall remain convertible for 90 days
following such termination of employment with such conversion effective as of
the date of a notice of conversion is provided to the Registrant. To the extent
that the investor does not elect to have such Debentures converted or if such
Debentures are not vested at such termination of employment, the Registrant will
redeem the Debenture as soon as practicable following the expiration of the
conversion period, if any, at its principal amount, plus accrued interest.
Termination Due to Death, Disability or Retirement
If the investor is an employee of the Registrant at the time
of his death or termination of employment due to retirement or disability, his
Debenture will be convertible in full for one year following such event,
regardless of the period of time that he held the Debenture. Such conversion
will be effective as of the date the investor provides the Registrant with a
notice of conversion. If the investor does not convert the Debenture, the
Registrant will redeem it, at its principal amount, plus accrued interest as
soon a practicable following the expiration of the one year period described
above.
6
<PAGE>
Loans
To finance the purchase price of a Debenture, the Registrant
will lend to each investor up to 100% of the principal amount of his Debenture,
at an annual interest rate of 6.25% payable semi-annually on each June 30 and
December 31, commencing June 30, 2000. Each loan will be non-recourse with
respect to principal and recourse with respect to interest and such loan will be
secured by the Debenture and evidenced by a promissory note (the "Note"). The
Note will be payable on January 20, 2004, but will accelerate upon a conversion
or redemption of the Debenture and may be accelerated by the Registrant upon the
occurrence of any event of default (as defined in the Notes). Events of default
under the Note include the following: (i) nonpayment of principal when due; (ii)
nonpayment of interest for ten business days after it is due; (iii) failure by
the investor for 30 days after receipt of notice to comply with any of his other
agreements in the Note or the purchase agreement; and (iv) certain events of
bankruptcy or insolvency, including commencement of a voluntary or involuntary
proceeding under the federal bankruptcy laws. If any event of default occurs and
is continuing, the Registrant may declare the Note to be due and payable
immediately.
Item 5. Interests of Named Experts and Counsel.
The legality of the securities offered hereby has been passed
upon for the Registrant by Theodore A. Levine, Senior Vice President and General
Counsel of Registrant, who owns beneficially 42,079 shares of Registrant's
Common Stock and has options to purchase 125,000 shares of the Registrant's
common Stock that are not currently exercisable.
Item 6. Indemnification of Directors and Officers.
Section 102 of the General Corporation Law of the State of
Delaware gives corporations the power to eliminate the personal liability of
directors under certain circumstances. Section 145 of the General Corporation
Law of the State of Delaware gives corporations the power to indemnify directors
and officers under certain circumstances.
Article IX of the Restated Certificate of Incorporation
(relating to the elimination of personal liability of directors of the
Registrant) of the Registrant filed as Exhibit 3.1 of the Registrant's Form 10-Q
for the quarter ended March 31, 1998 is incorporated herein by reference.
Article VII of the registrant's By-Laws (relating to indemnification of
directors and officers of the Registrant) filed as Exhibit 3.5 of Registrant's
Form 10-K for the year ended December 31, 1997 is incorporated herein by
reference.
The Registrant also maintains directors and officers liability
and corporate reimbursement insurance which provides for coverage against loss
arising from claims made against directors and officers in their capacity as
such. The general scope of coverage is any breach of duty, neglect, error,
misstatement, misleading statement or omission. Such policy does not exclude
liabilities under the Securities Act. The Registrant also maintains fiduciary
liability insurance for losses in connection with claims made against directors
or officers for violation of any of the responsibilities, obligations or duties
imposed upon fiduciaries under the Employee Retirement Income Act of 1974, as
amended.
7
<PAGE>
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit Index
EXHIBIT
NUMBER DESCRIPTION OF DOCUMENT
4.1 Paine Webber Group Inc. 6.25% Convertible Debentures Due
January 20, 2007
4.2 Paine Webber Group Inc. Series A Convertible Redeemable
Preferred Stock
4.3 Paine Webber Group Inc. Purchase Agreement for the 6.25%
Convertible Debentures Due January
5 Opinion of Theodore A. Levine as to the legality of the
Securities being registered
23.1 Consent of Ernst & Young LLP
23.2 Consent of Theodore A. Levine (set forth in Exhibit 5
Opinion)
24 Power of Attorney (set forth on the signature page of
this Registration Statement)
Item 9. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section
10(a)(3) of the Securities Act;
(ii) to reflect in the prospectus any facts or events
arising after the effective date of this Registration
Statement (or the most recent post-effective amendment
thereof) which, individually or in aggregate, represent a
fundamental change in the information set forth in this
Registration Statement; and
(iii) to include any material information with
respect to the plan of distribution not previously disclosed
in this Registration Statement or any material change to such
information in the Registration Statement;
provided, however, that the undertakings set forth in paragraphs (1)(i)
and (1)(ii) above do not apply if the registration statement is on Form
S-3, Form S-8 or Form F-3, and the information required to be included
in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the Registrant pursuant to Section 13 or
Section
8
<PAGE>
15(d) of the Exchange Act that are incorporated by reference in
this Registration Statement;
(2) That, for the purpose of determining any liability under
the Securities Act, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof; and
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(b) The Registrant further undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in this Registration Statement
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at the time shall be deemed
to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under
the Securities Act may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
9
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8, and has duly caused this
Registration Statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of New York, State of New York on February 29,
2000.
PAINE WEBBER GROUP INC.
(Registrant)
By: /s/ Donald B. Marron
--------------------
Donald B. Marron
Chairman of the Board and
Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each person whose
signature appears below constitutes and appoints DONALD B. MARRON, F. DANIEL
CORKERY and REGINA DOLAN, and each of them (with full power to each of them to
act alone), their true and lawful attorney-in-fact agent, with full power of
substitution and resubstitution, for them and in their name, place and stead, in
any and all capacities, to sign any or all amendments (including post-effective
amendments) to this Registration Statement, and to file the same, with all
exhibits thereto and other documents in connection therewith, with the
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done in an about the premises, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or any of them, or his or
their substitutes, may lawfully do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act, this
Registration Statement has been signed by the following persons in the
capacities and dates indicated.
<PAGE>
Name and Signature Title Date
- ------------------ ----- ----
/s/ Donald B. Marron
- --------------------------
Donald B. Marron Chairman of the Board February 29, 2000
Chief Executive Officer
and Director
/s/Jerome Fadden
- --------------------------
Jerome Fadden Senior Vice President February 29, 2000
(Principal Financial and Chief Financial Officer
Accounting Officer)
10
<PAGE>
Name and Signature Title Date
- ------------------ ----- ----
/s/ Regina A. Dolan
- --------------------------
Regina A. Dolan Senior Vice President February 29, 2000
Officer and Director
/s/ E. Garrett Bewkes, Jr.
- --------------------------
/s/ E. Garrett Bewkes, Jr. Director February 29, 2000
/s/ Reto Braun
- --------------------------
/s/ Reto Braun Director February 29, 2000
/s/ Joseph J. Grano, Jr.
- --------------------------
/s/ Joseph J. Grano, Jr. Director February 29, 2000
/s/ Frank P. Doyle
- --------------------------
/s/ Frank P. Doyle Director February 29, 2000
/s/ James W. Kinnear
- --------------------------
/s/ James W. Kinnear Director February 29, 2000
/s/ Naoshi Kiyono
- --------------------------
/s/ Naoshi Kiyono Director February 29, 2000
/s/ Robert M. Loeffler
- --------------------------
/s/ Robert M. Loeffler Director February 29, 2000
/s/ Edward Randall, III
- --------------------------
/s/ Edward Randall, III Director February 29, 2000
/s/ Henry Rosovsky
- --------------------------
/s/ Henry Rosovsky Director February 29, 2000
11
<PAGE>
Name and Signature Title Date
- ------------------ ----- ----
/s/ Ken-ichi Sekiguchi
- --------------------------
/s/ Ken-ichi Sekiguchi Director February 29, 2000
/s/ John R. Torell, III
- --------------------------
/s/ John R. Torell, III Director February 29, 2000
12
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- ------- -----------
4.1 Paine Webber Group Inc. 6.25% Convertible Debentures Due January 20,
2007
4.2 Paine Webber Group Inc. Series A Convertible Redeemable Preferred
Stock
4.3 Paine Webber Group Inc. Purchase Agreement for the 6.25% Convertible
Debentures Due January 20, 2007
5.1 Opinion of Theodore A. Levine (set forth in Exhibit 5)
23.1 Consent of Ernst & Young LLP
23.2 Consent of Theodore A. Levine (included in its opinion filed as
Exhibit 5.1)
24 Powers of attorney (included on signature page)
The transfer of this Debenture is subject to the restrictions set forth in
Section 4 of the Purchase Agreement dated January 20, 2000 between Paine Webber
Group Inc. and the original holder of this Debenture.
PAINE WEBBER GROUP INC.
6.25% CONVERTIBLE DEBENTURE DUE 2007
No. New York, New York
$ January 20, 2000
PAINE WEBBER GROUP INC., a Delaware corporation (the
"Company"), for value received, hereby promises to pay to (the "Employee") the
principal amount of ($ ) on January 20, 2007, and to pay interest (computed on
the basis of a 360-day year for the actual number of days elapsed) on the unpaid
balance of such principal amount at a rate of 6.25% per annum from the date
hereof, payable semiannually on each June 30 and December 31 after the date
hereof, commencing June 30, 2000, until such unpaid balance shall become due and
payable (whether at maturity or at a date fixed for prepayment or by
acceleration or otherwise).
If any payment of principal of or interest on this Debenture
is due on a day that is not a Business Day, such payment shall be made on the
next succeeding Business Day. Payments of principal of and interest on this
Debenture shall be made in lawful money of the United States of America at the
principal office of the Company in the borough of Manhattan, the City and State
of New York, or at such other office or agency in such Borough as the Company
shall have designated by written notice to the registered holder hereof, or by a
check of the Company payable to the registered holder hereof in such money and
mailed to such holder at his registered address.
This Debenture is being issued pursuant to, and is subject to
and incorporates by reference all of the terms of, the Purchase Agreement dated
as of the date hereof between the Company and the Employee (the "Purchase
Agreement"), including but not limited to the covenants set forth in Section 7
thereof.
1. Conversion and Redemption. On and subject to the terms and
conditions set forth below, all or any portion of the unpaid principal amount of
this Debenture equal to $1,000 or any integral multiple thereof may be converted
into ____ shares of Series A Convertible Redeemable Preferred Stock established
or to be established by the Company pursuant to the terms of the Purchase
Agreement (the "Preferred Stock") at a conversion price equal to the liquidation
value of $38.1875 per share (the "Conversion Price"). No part of this Debenture
may be converted prior to January 20, 2003, except as described below. On such
date and thereafter the original principal amount hereof shall become fully
convertible into shares of Preferred Stock at the Conversion Price.
1
<PAGE>
Upon any conversion of this Debenture, the registered holder
hereof shall deliver to the Company a Notice of Conversion in the form attached
to this Debenture. The foregoing notwithstanding, this Debenture shall be
convertible as provided herein only under the following circumstances:
(a) While the Employee is a full-time employee of the Company
or any Subsidiary, he shall be entitled to convert this Debenture on or after
January 20, 2003 as of the date the Employee provides a Notice of Conversion,
provided that, if the Company has elected to redeem the debenture as described
below, the Employee may still elect to convert as of the date a Notice of
Conversion is provided to the Company as long as the Employee remains employed
as of the date of such Notice of Conversion and such Notice of Conversion is
provided to the Company prior to the date set forth in the redemption notice,
except as otherwise provided in clause (e) below.
(b) For one year following the death of the Employee or
termination of his employment with the Company or any Subsidiary due to
Retirement or Disability, the Employee or his estate or other legal
representative, as the case may be, shall be entitled to convert 100% of the
principal amount hereof and such conversion shall be effective as of the date
the Notice of Conversion is provided to the Company. If the Employee does not
elect conversion pursuant to this clause (b), the Company will automatically
redeem such Debenture for 100% principal amount, plus accrued interest as soon a
practicable following the expiration of the one year period described herein.
(c) For ninety days following a Termination Without Cause or a
Voluntary Termination by the Employee that occurs on or after January
20, 2003, the Employee shall be entitled to convert 100% of the
principal amount hereof and such conversion shall be effective as of
the date of the Notice of Conversion. To the extent that the Employee
does not elect conversion pursuant to this clause (c) or if such
termination of employment occurs prior to January 20, 2003, the Company
will automatically redeem such Debenture for 100% principal amount,
plus accrued interest as soon a practicable following the expiration of
the conversion period described herein, if any.
(d) If the Employee's employment is terminated for Cause, the
Debenture will cease to be convertible as of the date of such
termination of employment and the Company will redeem it at the
principal amount, plus accrued interest as of such date.
(e)
(A) In the event that prior to January 20, 2003, (i)
the Company enters into an agreement, (ii) the Board of
Directors of the Company approves a transaction, or (iii)
there is a tender offer, which in either case, might result in
a Change in Control, the Employee may elect to have the
Debenture converted even if his employment is terminated other
than for Cause or the Company may elect to redeem such
Debenture prior to the effective time of the Change in Control
and such conversion or redemption will be effective as of the
effective time of the Change in Control. However, if the
Company elects to redeem the Debenture prior to the Employee's
election to convert, the Employee may still elect to convert
such Debenture rather than having the Company redeem it as
2
<PAGE>
long as the Employee provides a Notice of Conversion prior to
the effective time of the Change in Control. In the event the
Debenture is not redeemed or converted prior to the Change in
Control which occurs prior to January 20, 2003, such Debenture
shall become fully convertible following the Change of Control
but the Company may not redeem such Debenture until on or
after January 20, 2004 as described below. Any conversion or
redemption following a Change in Control will be implemented
in accordance with the procedures described herein. In the
event that the Change in Control does not become effective,
any election to convert or redeem will not be effectuated
unless the Debenture otherwise becomes convertible or
redeemable as described herein.
(B) In the event that on or after January 20, 2003, (i) the
Company enters into an agreement, (ii) the Board of Directors
of the Company approves a transaction, or (iii) there is a
tender offer, which in either case, might result in a Change
in Control, the Debenture will remain convertible in
accordance with the procedures described herein, even if the
Employee's employment is terminated other than for Cause.
However the Company may elect to redeem such Debenture prior
to such Change in Control which occurs on or after January 20,
2003. However, if the Company elects to redeem the Debenture
prior to the Employee's election to convert, the Employee may
still elect to convert such Debenture rather than having the
Company redeem it as long as the Employee provides a Notice of
Conversion to the Company prior to the effective time of the
Change in Control. In the event the Debenture is not redeemed
or converted prior to the Change in Control which occurs on or
after January 20, 2003 or such Change in Control does not
occur, such Debenture shall remain fully convertible to the
extent such Debenture remains outstanding following the Change
in Control but the Company may not redeem such Debenture until
on or after January 20, 2004 in accordance with the procedures
described herein.
Notwithstanding the foregoing, on or after January 20, 2004,
the Company may redeem the Debenture, provided that it has not already been
converted or redeemed upon giving 60 days prior written notice and such
redemption will be effective at the end of the 60 day period. However, if the
Employee is entitled to convert the Debenture as described above, the Employee
may elect to do so following the receipt of a notice of redemption from the
Company and such conversion will be effective as of the date of the Notice of
Conversion as long as such notice is provided to the Company prior to the date
such redemption was to occur.
Promptly after a conversion of this Debenture or any portion
hereof, the Company shall pay to the registered holder hereof all interest
accrued hereon, or on the portion hereof converted, to the Conversion Date (as
hereinafter defined) and shall issue and deliver to the registered holder hereof
a certificate or certificates registered in his or its name for the number of
whole shares of Preferred Stock issuable upon such conversion. The "Conversion
Date" is the date on which this Debenture, or any portion hereof, is surrendered
for conversion as provided above.
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If less than the full principal amount of this Debenture is
converted, the Company shall also deliver to the Pledgee, if any, or otherwise
to the registered holder hereof a new Debenture in the form hereof for the
balance of the principal amount of this Debenture.
2. Events of Default; Acceleration. If any of the following
conditions or events ("Events of Default") shall occur and be continuing
(whether such occurrence shall be voluntary or involuntary or come about or be
effected by operation of law or otherwise):
(a) the Company fails to (i) make any payment or prepayment of
principal of this Debenture when due, or (ii) pay any interest on this
Debenture when due and such failure to pay interest or such other
amounts remains unremedied for ten Business Days; or
(b) any representation or warranty made by the Company in the
Purchase Agreement proves to have been incorrect, in any material
respect when made; or
(c) the Company fails to perform or observe any other term,
covenant or agreement contained in this Debenture or the Purchase
Agreement on its part to be performed or observed, and any such failure
remains unremedied for 30 days after notice thereof is given to the
Company by the registered holder of this Debenture; or
(d) the Company or PaineWebber Incorporated ("PWI"):
(i) voluntarily commences any proceeding or files any
petition seeking relief under Title 11 of the United States
Code or any other Federal or state bankruptcy, insolvency or
similar law,
(ii) consents to the institution of, or fails to
controvert in a timely and appropriate manner, any such
proceeding or the filing of any such petition,
(iii) applies for or consents to the appointment of a
receiver, trustee, custodian, sequestrator or similar official
for the Company or PWI or for a substantial part of the
property of either of them, or
(iv) makes a general assignment for the benefit of
creditors; or
(e) an involuntary proceeding is commenced or a voluntary
petition is filed in a court of competent jurisdiction seeking:
(i) relief against the Company or PWI, or all or a
substantial part of the property of either of them, under
Title 11 of the United States Code or any other federal or
state bankruptcy, insolvency or similar law,
(ii) the appointment of a receiver, trustee,
custodian, sequestrator or similar official for the Company or
PWI or for a substantial part of the property of either of
them, or
(iii) the winding-up or liquidation of the Company
or PWI;
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and such proceeding or petition continues undismissed for 60 days or an
order or decree approving or ordering any of the foregoing is entered;
then, at any time thereafter during the continuance of any such event, the
registered holder hereof may, by written notice to the Company, declare this
Debenture to be due and payable, whereupon it shall forthwith mature and become
due and payable, together with all interest accrued thereon, without
presentment, demand, protest or further notice, all of which are hereby
expressly waived by the Company.
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3. Definitions.
"Board" shall mean the Board of Directors of the Company.
"Business Day" shall mean any day on which banking
institutions in the Borough of Manhattan, City and State of New York, are open
for business and not authorized or obligated by law or executive order to close.
"Cause" shall mean (i) the Employee's conviction or plea of no
contest to a felony involving the business of the Company or any Subsidiary,
(ii) the Employee's fraud against the business of the Company or any Subsidiary
as determined by the Compensation Committee, (iii) any intentional act or
omission by the Employee not undertaken in the good faith belief that it was in
pursuit of the business of the Company or any Subsidiary and which is intended
to cause and does cause material injury to the business, financial condition or
prospects of the Company or any Subsidiary, or (iv) the Employee's continued and
repeated failure to perform the material duties of the Employee's position with
the Company or any Subsidiary (other than by reason of approved leave of
absence, illness or disability) after the Employee has received written notice
from the Company or any Subsidiary of such failure.
"Change in Control" shall mean the occurrence of one or more
of the following events:
(i) Any "person" (as such term is used in Sections 13(d) and
14(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), other than the Company or any Subsidiary (collectively referred
to as "PWG"), any trustee or other fiduciary holding securities under
an employee benefit plan of PWG, or any corporation owned, directly or
indirectly, by the stockholders of Paine Webber in substantially the
same proportions as their contemporaneous ownership of voting
securities of Paine Webber, is or becomes a "20% Beneficial Owner." For
purposes of this provision, a "20% Beneficial Owner" shall mean a
person who is or becomes the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly, of securities of
Company representing 20% or more of the combined voting power of
Company's then-outstanding voting securities (a "20% Beneficial
Owner"); provided that (A) the term "20% Beneficial Owner" shall not
include any Beneficial Owner that has crossed such 20% threshold solely
as a result of an acquisition of securities directly from Company, or
solely as a result of an acquisition by Company of Company securities,
until such time thereafter as such person acquires additional voting
securities other than directly from Company and, after giving effect to
such acquisition, such person would constitute a 20% Beneficial Owner
and (B) with respect to any person who is and remains eligible to file
a Schedule 13G pursuant to Rule 13d-1(b)(1) under the Exchange Act with
respect to Company securities, there shall be excluded from the number
of securities deemed to be beneficially owned by such person for
purposes of determining whether such person is a 20% Beneficial Owner a
number of securities representing 10% of the combined voting power of
Company's then-outstanding voting securities;
(ii) during any period of two consecutive years,
individuals who at the beginning of such period constitute the Board of
Directors of the Company,
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together with any new director (other than a director designated by a
person who has entered into an agreement with Company to effect a
transaction described in paragraph (i), (iii) or (iv) hereof) whose
election by the Board of Directors or nomination for election by
Company's stockholders was approved by a vote of at least two-thirds
(K) of the directors then still in office who either were directors at
the beginning of the period or whose election or nomination for
election was previously so approved (the "Continuing Directors"), cease
for any reason to constitute at least a majority thereof;
(iii) the stockholders of Company approve a merger,
consolidation, recapitalization, or reorganization of Company, or a
reverse stock split of any class of voting securities of Company, or
the consummation of any such transaction if stockholder approval is not
obtained, other than any such transaction which would result in at
least 80% of the total voting power represented by the voting
securities of Company or the surviving entity outstanding immediately
after such transaction being beneficially owned by persons who together
beneficially owned at least 80% of the combined voting power of the
voting securities of Company outstanding immediately prior to such
transaction, with the relative voting power of each such continuing
holder compared to the voting power of each other continuing holder not
substantially altered as a result of the transaction; provided that,
for purposes of this paragraph (iii), such continuity of ownership (and
preservation of relative voting power) shall be deemed to be satisfied
if the failure to meet such 80% threshold (or to substantially preserve
such relative voting power) is due solely to the acquisition of voting
securities by an employee benefit plan of Company or such surviving
entity or of any subsidiary of Company or such surviving entity;
(iv) the stockholders of Company approve a plan of
complete liquidation of PWG or an agreement for the sale or disposition
by PWG of all or substantially all of PWG's assets (or any transaction
having a similar effect); or
(v) any other event which the Board of the Company
determines shall constitute a Change in Control for purposes of the
Program.
"Common Stock" shall mean the common stock, $1.00 par value
per share, of the Company.
"Disability" shall have the same meaning as is ascribed to
such term in the PaineWebber Long Term Disability Plan.
"Pledgee" shall mean any person or other entity that holds the
Debenture in pledge and has given written notice thereof, and of its current
mailing address, to the Company.
"Retirement" shall mean the Employee's termination of
employment on the first day of the month coincident with or next following (x)
the tenth anniversary of the date on which his employment with the Company
commenced and the date the Employee is at least 55 years old; provided that the
Compensation Committee of the Company approves of such retirement, or (y) the
date of his 65th birthday.
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"Subsidiary" shall mean any corporation, association or other
business entity which is required to be consolidated with the Company under
generally accepted accounting principles.
"Termination Without Cause" shall mean a termination by the
Company or a Subsidiary of the Employee's employment for any reason other than
death, Retirement, Disability or Cause, if the Employee does not continue in the
employment of, or promptly commence employment with, the Company or any
Subsidiary.
"Voluntary Termination" shall mean a termination of employment
with the Company or a Subsidiary at the initiative of the Employee, (unless upon
such termination, the Employee remains in the employment of, or commences
employment with, the Company or one or more Subsidiaries.
4. Governing Law. This Debenture shall be governed by and
construed in accordance with the laws of the State of New York, without
reference to principles of conflict of laws.
PAINE WEBBER GROUP INC.
By:
------------------------
Title:
8
PAINE WEBBER GROUP INC.
TERMS OF THE SERIES A CONVERTIBLE REDEEMABLE PREFERRED STOCK
This series of Series Preferred Stock authorized under the
Restated Certificate of Incorporation of Paine Webber Group Inc. (the
"Certificate of Incorporation") shall be the Series A Convertible
Redeemable Preferred Stock, (the "Convertible Preferred Stock").
(i) Holders of shares of Convertible Preferred Stock will be
entitled to receive, when and as declared by the Board of Directors
(the "Board") of Paine Webber Group Inc. (the "Corporation") out of
assets of the Corporation legally available for payment, an annual cash
dividend of $.48 per share, payable in quarterly installments on March
31, June 30, September 30 and December 31, commencing June 30, 2000.
Dividends on the Convertible Preferred Stock will be cumulative from
the date of initial issuance of any shares of Convertible Preferred
Stock. Dividends will be payable to holders of record as they appear on
the stock books of the Corporation on such record dates, not more than
60 days nor less than 10 days preceding the payment dates thereof, as
shall be fixed by the Board. When dividends are not paid in full upon
the Convertible Preferred Stock and any other preferred stock ranking
on a parity as to dividends with the Convertible Preferred Stock (such
other preferred stock and the Convertible Preferred Stock hereinafter
being collectively referred to as "Parity Preferred Stock"), all
dividends declared upon shares of Parity Preferred Stock will be
declared pro rata so that in all cases the amount of dividends declared
per share on the Convertible Preferred Stock and such other Parity
Preferred Stock shall bear to each other the same ratio that
accumulated and unpaid dividends per share on the shares of Convertible
Preferred Stock and such other Parity Preferred Stock bear to each
other. Except as set forth in the preceding sentence, unless full
cumulative dividends on the Convertible Preferred Stock have been paid,
no dividends (other than in Common Stock of the Corporation (as defined
in paragraph (iii)(I) below) or any other stock of the Corporation
ranking junior to the Convertible Preferred Stock as to dividends) may
be paid or declared and set aside for payment or other distribution
made upon the Common Stock or on any other stock of the Corporation
ranking junior to or on a parity with the Convertible Preferred Stock
as to dividends, nor may any Common Stock or any other stock of the
Corporation ranking junior to or on a parity with the Convertible
Preferred Stock as to dividends be redeemed, purchased or otherwise
acquired for any consideration (or any payment made to or available for
a sinking fund for the redemption of any shares of such stock) by the
Corporation (except by conversion into or exchange for stock of the
Corporation ranking junior to the Convertible Preferred Stock as to
dividends). Dividends payable for any partial dividend period shall be
calculated on the basis of a 360-day year of 12 30-day months.
(ii) The shares of Convertible Preferred Stock shall rank
prior to the shares of Common Stock and of any other class of stock of
the Corporation ranking junior to the Series Preferred Stock upon
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liquidation, so that, in the event of any liquidation, dissolution or
winding-up of the Corporation, whether voluntary or involuntary, the
holders of the Convertible Preferred Stock shall be entitled to receive
out of the assets of the Corporation available for distribution to its
stockholders, whether from capital, surplus or earnings, before any
distribution is made to holders of shares of Common Stock or any other
such junior stock, an amount equal to $38.1875 per share (the
"Liquidation Preference" of a share of Convertible Preferred Stock)
plus an amount equal to all dividends (whether or not earned or
declared) accumulated and unpaid on the shares of Convertible Preferred
Stock to the date of final distribution. If, upon any liquidation,
dissolution or winding-up of the Corporation, the assets of the
Corporation, or proceeds thereof, distributable among the holders of
shares of Parity Preferred Stock shall be insufficient to pay in full
the liquidation preference amounts of the Parity Preferred Stock and
all dividends (whether or not earned or declared) accumulated and
unpaid thereon, then such assets, or the proceeds thereof, shall be
distributable among such holders ratably in accordance with the
respective amounts which would be payable on such shares if all amounts
payable thereon were paid in full. For the purposes hereof, the
voluntary sale, conveyance, exchange or transfer (for cash, shares of
stock, securities or other consideration) of all or substantially all
the property or assets of the Corporation shall be deemed a voluntary
liquidation, dissolution or winding-up of the Corporation, but a
consolidation or merger of the Corporation with one or more other
corporations shall not be deemed to be a liquidation, dissolution or
winding-up, voluntary or involuntary.
(iii) (I) Subject to and upon compliance with the provisions
of this paragraph (iii), the holder of a share of Convertible Preferred
Stock shall have the right, at his or her option, at any time, except
that, if such share is called for redemption, not after the date fixed
for such redemption, to convert such share into that number of fully
paid and nonassessable shares of Common Stock (calculated as to each
conversion to the nearest 1/100th of a share) obtained by dividing the
Liquidation Preference of such share being converted by the Conversion
Price (as defined below), upon surrender of such share so to be
converted, such surrender to be made in the manner provided in
subsection (II) of this paragraph (iii).
The term "Common Stock" shall mean the Common Stock, $1 par
value, of the Corporation as the same exists at the date of this
Certificate or as such stock may be constituted from time to time,
except that, for the purpose of subsection (V) of this paragraph (iii),
the term "Common Stock" shall also mean and include stock of the
Corporation of any class, whether now or hereafter authorized, which
shall have the right to participate in the distribution of either
earnings or assets of the Corporation without limit as to amount or
percentage.
The term "Conversion Price" shall mean $38.1875, as adjusted
in accordance with the provisions of this paragraph (iii).
(II) In order to exercise the conversion privilege, the holder
of each share of Convertible Preferred Stock to be converted shall
surrender the Certificate representing such share at the office of the
conversion agent for the Convertible Preferred Stock in the
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<PAGE>
Borough of Manhattan, City of New York, appointed for such purpose by
the Corporation, with the Notice of Election to Convert on the back of
said certificate completed and signed. Unless the shares issuable on
conversion are to be issued in the same name as the name in which such
share of Convertible Preferred Stock is registered, each share
surrendered for conversion shall be accompanied by instruments of
transfer, in form satisfactory to the Corporation and duly executed by
the holder or his duly authorized attorney, and an amount sufficient to
pay any transfer or similar tax. No payment or adjustment shall be made
on conversion for dividends accumulated on the Convertible Preferred
Stock surrendered for conversion or for dividends on Common Stock
delivered on such conversion. As promptly as practicable after the
surrender of the certificates for shares of Convertible Preferred Stock
as aforesaid, the Corporation shall issue and shall deliver at such
office to such holder, or on his written order, a certificate or
certificates for the number of full shares of Common Stock issuable
upon the conversion of such shares in accordance with the provisions of
this paragraph (iii), and any fractional interest in respect of a share
of Common Stock arising upon such conversion shall be settled as
provided in subsection (III) of this paragraph (iii).
Each conversion shall be deemed to have been effected
immediately prior to the close of business on the date on which the
certificates for shares of Convertible Preferred Stock shall have been
surrendered and such notice received by the Corporation as aforesaid,
and the person or persons in whose name or names any certificate or
certificates for shares of Common Stock shall be issuable upon such
conversion shall be deemed to have become the holder or holders of
record of the shares represented thereby at such time on such date, and
such conversion shall be at the Conversion Price in effect at such time
on such date, unless the stock transfer books of the Corporation shall
be closed on that date, in which event such person or persons shall be
deemed to have become such holder or holders of record at the close of
business on the next succeeding day on which such stock transfer books
are open, but such conversion shall be at the Conversion Price in
effect on the date upon which such shares shall have been surrendered
and such notice received by the Corporation. All shares of Common Stock
delivered upon conversions of the Convertible Preferred Stock will upon
delivery be duly and validly issued and fully paid and nonassessable,
free of all liens and charges and not subject to any preemptive rights.
(III) No fractional shares or scrip representing fractions of
shares of Common Stock shall be issued upon conversion of the
Convertible Preferred Stock. Instead of any fractional interest in a
share of Common Stock which would otherwise be deliverable upon the
conversion of a share of Convertible Preferred Stock, the Corporation
shall pay to the holder of such share an amount in cash (computed to
the nearest cent) equal to the current market price (as defined in
subsection (IV)(d) of this paragraph (iii)) thereof at the close of
business on the business day next preceding the day of conversion. If
more than one share shall be surrendered for conversion at one time by
the same holder, the number of full shares of Common Stock issuable
upon conversion thereof shall be computed on the basis of the aggregate
Liquidation Preference of the shares of Convertible Preferred Stock so
surrendered.
(IV) The Conversion Price shall be adjusted from time to time
as follows:
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(a) In case the Corporation shall hereafter (i) pay a
dividend or make a distribution on the Common Stock in shares
of Common Stock, (ii) subdivide its outstanding shares of
Common Stock into a greater number of shares, (iii) combine
its outstanding shares of Common Stock into a smaller number
of shares, or (iv) issue by reclassification of the Common
Stock any shares of capital stock of the Corporation, the
Conversion Price in effect immediately prior to such action
shall be adjusted so that the holder of any share of
Convertible Preferred Stock thereafter surrendered for
conversion shall be entitled to receive the number of shares
of Common Stock or other capital stock of the Corporation
which he would have owned or been entitled to receive
immediately following such action had such share been
converted immediately prior thereto. An adjustment made
pursuant to this subdivision (a) shall become effective
immediately after the record date, in the case of a dividend
or distribution, or immediately after the effective date, in
the case of a subdivision, combination or reclassification.
If, as a result of an adjustment made pursuant to this
subdivision (a), the holder of any share of Convertible
Preferred Stock thereafter surrendered for conversion shall
become entitled to receive shares of two or more classes of
capital stock or shares of Common Stock and other capital
stock of the Corporation, the Board (whose determination shall
be conclusive and shall be described in a statement filed with
the conversion agent by the Corporation as soon as
practicable) shall determine the allocation of the adjusted
Conversion Price between or among shares of such classes of
capital stock or shares of Common Stock and other capital
stock.
(b) In case the Corporation shall hereafter issue
rights or warrants to holders of its outstanding shares of
Common Stock generally entitling them (for a period expiring
within 45 days after the record date mentioned below) to
subscribe for or purchase shares of Common Stock at a price
per share less than the current market price per share (as
determined pursuant to subdivision (d) of this subsection
(IV)) of the Common Stock on the record date mentioned in the
next sentence (other than pursuant to an automatic dividend
reinvestment plan of the Corporation or any substantially
similar plan), the Conversion Price shall be adjusted so that
the same shall equal the price determined by multiplying the
Conversion Price in effect immediately prior to the date of
issuance of such rights or warrants by a fraction of which the
numerator shall be the number of shares of Common Stock
outstanding on the date of issuance of such rights or warrants
plus the number of shares which the aggregate offering price
of the total number of shares so offered would purchase at
such current market price, and of which the denominator shall
be the number of shares of Common Stock outstanding on the
date of issuance of such rights or warrants plus the number of
additional shares of Common Stock offered for subscription or
purchase. Such adjustment shall become effective immediately
after the record date for the determination of stockholders
entitled to receive such rights or warrants.
(c) In case the Corporation shall hereafter
distribute to holders of its outstanding shares of Common
Stock generally evidences of its indebtedness or assets
(excluding any cash dividend paid from retained earnings of
the Corporation and dividends or distributions payable in
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stock for which adjustment is made pursuant to subdivision (a)
of this subsection (IV)) or rights or warrants to subscribe to
securities of the Corporation (excluding those referred to in
subdivision (b) of this subsection (IV)), then in each such
case the Conversion Price shall be adjusted so that the same
shall equal the price determined by multiplying the Conversion
Price in effect immediately prior to the date of such
distribution by a fraction of which the numerator shall be the
current market price per share (determined as provided in
subdivision (d) of this subsection (IV)) of the Common Stock
on the record date mentioned in the next sentence less the
then fair market value (as determined by the Board, whose
determination shall be conclusive and shall be described in a
statement filed with the conversion agent by the Corporation
as soon as practicable) of the portion of the evidences of
indebtedness or assets so distributed to the holder of one
share of Common Stock or of such subscription rights or
warrants applicable to one share of Common Stock, and of which
the denominator shall be such current market price per share
of Common Stock. Such adjustment shall become effective
immediately after the record date for the determination of
stockholders entitled to receive such distribution.
(d) For the purpose of subsection (III) and
subdivisions (b) and (c) of this subsection (IV), the current
market price per share of Common Stock on any date shall mean
the price of a share of Common Stock on the relevant date,
determined on the basis of the last reported sale price
regular way of the Common Stock as reported on the composite
tape; or similar reporting system, for issues listed on the
New York Stock Exchange (or if the Common Stock is not then
listed on that Exchange, for issues listed on such other
national securities exchange upon which the Common Stock is
listed as may be designated by the Board for the purposes
hereof) or, if there is no such reported sale on the day in
question, on the basis of the average of the closing bid and
asked quotations as so reported, or, if the Common Stock is
not then listed on any national securities exchange, on the
basis of the closing price, if the Common Stock is a national
market issue, or the average of the high bid and low asked
quotations on the day in question in the over-the-counter
market as reported by the National Association of Securities
Dealers' Automated Quotations System, or if not so quoted, as
reported by National Quotation Bureau, Incorporated, or a
similar organization.
(e) In any case in which this paragraph (iii) shall
require that an adjustment be made immediately following a
record date or an effective date, the Corporation may elect to
defer (but only until five business days following the filing
by the Corporation with the conversion agent of the
certificate of independent public accountants required by
subdivision (g) of this subsection (IV)) issuing to the holder
of any share of Convertible Preferred Stock converted after
such record date or effective date the additional shares of
Common Stock or other capital stock issuable upon such
conversion over and above the shares of Common Stock or other
capital stock issuable upon such conversion on the basis of
the Conversion Price prior to adjustment, and paying to such
holder any amount of cash in lieu of a fractional share.
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(f) No adjustment in the Conversion Price shall be
required to be made unless such adjustment would require an
increase or decrease of at least 1% of such price; provided,
however, that any adjustments which by reason of this
subdivision (f) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment.
All calculations under this paragraph (iii) shall be made to
the nearest cent or to the nearest 1/100th of a share, as the
case may be. Anything in this paragraph (iii) to the contrary
notwithstanding, the Corporation shall be entitled to make
such reduction in the Conversion Price, in addition to those
required by this paragraph (iii), as it in its discretion
shall determine to be advisable in order that any stock
dividend, subdivision of shares, distribution of rights to
purchase stock or securities, or distribution of securities
convertible into or exchangeable for stock hereafter made by
the Corporation to its stockholders shall not be taxable to
the recipients.
(g) Whenever the Conversion Price is adjusted as
herein provided, (i) the Corporation shall promptly file with
the conversion agent a certificate of a firm of independent
public accountants (who may be the regular accountants
employed by the Corporation) setting forth the Conversion
Price after such adjustment and setting forth a brief
statement of the facts requiring such adjustment and the
manner of computing the same, which certificate shall be
conclusive evidence of the correctness of such adjustment, and
(ii) a notice stating that the Conversion Price has been
adjusted and setting forth the adjusted Conversion Price shall
forthwith be mailed by the Corporation to the holders of the
Convertible Preferred Stock at their addresses as shown on the
stock books of the Corporation.
(h) In the event that at any time as a result of an
adjustment made pursuant to subdivision (a) of this subsection
(IV), the holder of any share of Convertible Preferred Stock
thereafter surrendered for conversion shall become entitled to
receive any shares of the Corporation other than shares of
Common Stock, thereafter the Conversion Price of such other
shares so receivable upon conversion of any share shall be
subject to adjustment from time to time in a manner and on
terms as nearly equivalent as practicable to the provisions
with respect to Common Stock contained in this paragraph
(iii).
(V) In case:
(a) the Corporation shall take any action which would
require any adjustment in the Conversion Price pursuant to
subsection (IV)(c); or
(b) the Corporation shall authorize the granting to
the holders of the Common Stock of rights or warrants to
subscribe for or purchase any shares of stock of any class or
of any other rights; or
(c) there shall be any capital stock reorganization
or reclassification of the Common Stock (other than a
subdivision or combination of the outstanding Common Stock and
other than a change in the par value of the Common Stock),
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or any consolidation or merger to which the Corporation is a
party or any statutory exchange of securities with another
corporation and for which approval of any stockholders of the
Corporation is required, or any sale or transfer of all or
substantially all the assets of the Corporation; or
(d) there shall be a voluntary dissolution,
liquidation or winding-up of the Corporation;
then the Corporation shall cause to be filed with the conversion agent,
and shall cause to be mailed to the holders of shares of the
Convertible Preferred Stock at their addresses as shown on the stock
books of the Corporation, at least 10 days prior to the applicable date
hereinafter specified, a notice stating (i) the date on which a record
is to be taken for the purpose of such distribution or rights, 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 distribution or rights are to be
determined, or (ii) the date on which such reorganization,
reclassification, consolidation, merger, statutory exchange, sale,
transfer, dissolution, liquidation or winding-up 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 shares of
Common Stock for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, statutory
exchange, sale, transfer, dissolution, liquidation or winding-up.
Failure to give such notice or any defect therein shall not affect the
legality or validity of the proceedings described in subdivision (a),
(b), (c) or (d) of this subsection (V).
(VI) The Corporation covenants that it will at all times
reserve and keep available, free from preemptive rights, out of the
aggregate of its authorized but unissued shares of Common Stock or its
issued shares of Common Stock held in its treasury, or both, for the
purpose of effecting conversions of the Convertible Preferred Stock,
the full number of shares of Common Stock deliverable upon the
conversion of all shares of Convertible Preferred Stock then
outstanding and not theretofore converted or then deliverable upon
conversion of the Corporation's 6.25% Convertible Debentures Due
January 20, 2007 (the "2007 Debentures"). For purposes of this
subsection (VI), the number of shares of Common Stock that shall be
deliverable upon the conversion of all such shares of Convertible
Preferred Stock shall be computed as if at the time of computation all
such shares were held by a single holder.
Before taking any action that would cause an adjustment
reducing the Conversion Price below the then par value (if any) of the
shares of Common Stock deliverable upon conversion of the Convertible
Preferred Stock, the Corporation will take any corporate action which
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 at such adjusted Conversion Price.
To the extent not already listed, the Corporation will
endeavor to list the shares of Common Stock required to be delivered
upon conversion of the Convertible Preferred Stock prior to such
delivery upon each national securities exchange, if any, upon which the
outstanding Common Stock is listed at the time of such delivery.
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Prior to the delivery of any securities which the Corporation
shall be obligated to deliver upon conversion of the Convertible
Preferred Stock, the Corporation will endeavor to comply with all
federal and state laws and regulations thereunder requiring the
registration of such securities with, or any approval of or consent to
the delivery thereof by, any governmental authority.
(VII) 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 conversions of the Convertible
Preferred Stock pursuant hereto; provided, however, that the
Corporation shall not be required to pay any tax which may be payable
in respect of any transfer involved in the issue or delivery of shares
of Common Stock in a name other than that of the holder of the
Convertible Preferred Stock to be 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.
(VIII) Notwithstanding any other provision herein to the
contrary, 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 continuing corporation), or in case of any
statutory exchange of securities with another corporation (including
any exchange effected in connection with a merger of a third
corporation into the Corporation), the holder of each share of
Convertible Preferred Stock then outstanding shall have the right
thereafter to convert such share into the kind and amount of
securities, cash or other property receivable upon such consolidation,
merger or statutory exchange by a holder of the number of shares of
Common Stock into which such share of Convertible Preferred Stock might
have been converted immediately prior to such consolidation, merger or
statutory exchange, assuming such holder of Common Stock failed to
exercise his rights of election, if any, as to the kind or amount of
securities, cash or other property receivable upon such consolidation,
merger or statutory exchange (provided that if the kind or amount of
securities, cash or other property receivable upon such consolidation,
merger or statutory exchange is not the same for each share of Common
Stock in respect of which such rights of election shall not have been
exercised ("non-electing share"), then for the purpose of this
subsection (VIII) the kind and amount of securities, cash or other
property receivable upon such consolidation, merger or statutory
exchange for each nonelecting share shall be deemed to be the kind and
amount so receivable per share by a plurality of the nonelecting
shares). Thereafter, the holders of the Convertible Preferred Stock
shall be entitled to appropriate adjustments with respect to their
conversion rights to the end that the provisions set forth in this
paragraph (iii) shall correspondingly be made applicable, as nearly as
may be reasonable, in relation to any shares of stock or other
securities or property thereafter deliverable on the conversion of the
Convertible Preferred Stock. Any such adjustment shall be approved by a
firm of independent public accountants, evidenced by a certificate to
that effect delivered to the conversion agent; and any adjustment so
approved shall for all purposes hereof conclusively be deemed to be an
appropriate adjustment.
The above provisions of this subsection (VIII) shall similarly
apply to successive consolidations, mergers or statutory exchanges.
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(iv) Upon any conversion or redemption of shares of
Convertible Preferred Stock, the shares of Convertible Preferred Stock
so converted or redeemed shall have the status of authorized and
unissued shares of Series Preferred Stock, and the number of shares of
Series Preferred Stock which the Corporation shall have authority to
issue shall not be decreased by the conversion or redemption of shares
of Convertible Preferred Stock.
(v) The holders of shares of Convertible Preferred Stock shall
have no voting rights whatsoever, except for any voting rights to which
they may be entitled under the laws of the State of Delaware, and
except as follows:
(I) If and whenever at any time or times dividends
payable on the Convertible Preferred Stock or on any other
Parity Preferred Stock shall have been in arrears and unpaid
in an aggregate amount equal to or exceeding the amount of
dividends payable thereon for six quarterly periods or three
semi-annual periods, as the case may be, then the holders of
Parity Preferred Stock shall have, in addition to the other
voting rights set forth herein, the exclusive right, voting
separately as a class, to elect two directors of the
Corporation, such directors to be in addition to the number of
directors constituting the Board of Directors immediately
prior to the accrual of such right, the remaining directors to
be elected by the other class or classes of stock entitled to
vote therefor at each meeting of stockholders held for the
purpose of electing directors. Such voting right shall
continue until such time as all cumulative dividends
accumulated on all the Parity Preferred Stock having
cumulative dividends shall have been paid in full and until
any noncumulative dividends payable on all the Parity
Preferred Stock having noncumulative dividends shall have been
paid regularly for at least one year, at which time such
voting right of the holders of the Parity Preferred Stock
shall terminate, subject to revesting in the event of each and
every subsequent event of default of the character indicated
above.
Whenever such voting right shall have vested, such
right may be exercised initially either at a special meeting
of the holders of the Parity Preferred Stock, called as
hereinafter provided, or at any annual meeting of stockholders
held for the purpose of electing directors, and thereafter at
each successive annual meeting.
At any time when such voting right shall have vested
in the holders of the Parity Preferred Stock, and if such
right shall not already have been initially exercised, a
proper officer of the Corporation shall, upon the written
request of the holders of record of 10% in number of shares of
the Parity Preferred Stock then outstanding, addressed to the
Secretary of the Corporation, call a special meeting of the
holders of the Parity Preferred Stock and of any other class
or classes of stock having voting power with respect thereto
for the purpose of electing directors. Such meeting shall be
held at the earliest practicable date upon the notice required
for annual meetings of stockholders at the place for holding
of annual meetings of stockholders of the Corporation, or, if
none, at a place designated by the Secretary of the
Corporation.
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If such meeting shall not be called by the proper officers of
the Corporation within 30 days after the personal service of
such written request upon the Secretary of the Corporation, or
within 30 days after mailing the same within the United States
of America, by registered mail, addressed to the Secretary of
the Corporation at its principal office (such mailing to be
evidenced by the registry receipt issued by the postal
authorities), then the holders of record of 10% in number of
shares of the Parity Preferred Stock then outstanding may
designate in writing one of their number to call such meeting
at the expense of the Corporation, and such meeting may be
called by such person so designated upon the notice required
for annual meetings of stockholders and shall be held at the
same place as is elsewhere provided for in this subsection
(I). Any holder of the Parity Preferred Stock shall have
access to the stock books of the Corporation for the purpose
of causing a meeting of stockholders to be called pursuant to
the provisions of this paragraph. Notwithstanding the
provisions of this paragraph, however, no such special meeting
shall be called during a period within 90 days immediately
preceding the date fixed for the next annual meeting of
stockholders.
At any meeting held for the purpose of electing
directors at which the holders of the Parity Preferred Stock
shall have the right to elect directors as provided herein,
the presence in person or by proxy of the holders of 33-1/3%
of the then-outstanding shares of the Parity Preferred Stock
shall be required and be sufficient to constitute a quorum of
the Parity Preferred Stock for the election of directors by
the holders of the Parity Preferred Stock. At any such meeting
or adjournment thereof (A) the absence of a quorum of the
holders of the Parity Preferred Stock shall not prevent the
election of directors other than those to be elected by the
holders of the Parity Preferred Stock and the absence of a
quorum or quorums of the holders of other classes of capital
stock entitled to elect such other directors shall not prevent
the election of directors to be elected by the holders of the
Parity Preferred Stock and (B) in the absence of a quorum of
the holders of any class of stock entitled to vote for the
election of directors, a majority of the holders present in
person or by proxy of such class shall have the power to
adjourn the meeting for the election of directors which the
holders of such class are entitled to elect, from time to
time, without notice other than announcement at the meeting,
until a quorum shall be present.
The directors elected pursuant to this subsection (I)
shall serve until the next annual meeting or until their
respective successors shall be elected and shall qualify;
provided, however, that when the right of the holders of the
Parity Preferred Stock to elect directors as herein provided
shall terminate, the terms of office of all persons so elected
by the holders of the Parity Preferred Stock shall terminate,
and the number of directors of the Corporation shall thereupon
be such number as may be provided in the By-Laws of the
Corporation irrespective of any increase made pursuant to this
subsection (I).
(II) So long as any shares of the Convertible
Preferred Stock remain outstanding, the Corporation will not,
either directly or indirectly or through merger or
consolidation with any other corporation:
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<PAGE>
(a) without the affirmative vote at a
meeting or the written consent with or without a
meeting of the holders of at least 66-2/3% in number
of shares of the Series Preferred Stock of all series
then outstanding, (A) create any class or classes of
stock ranking equal or prior to the Series Preferred
Stock either as to dividends or upon liquidation or
increase the authorized number of shares of any class
or classes of stock ranking equal or prior to the
Series Preferred Stock either as to dividends or upon
liquidation, (B) amend, alter or repeal any of the
provisions of the Certificate of Incorporation so as
to affect adversely the preferences, special rights
or powers of the Series Preferred Stock or (C)
authorize any reclassification of the Series
Preferred Stock;
(b) without the affirmative vote at a
meeting or the written consent with or without a
meeting of the holders of at least 66-2/3% in number
of shares of the Convertible Preferred Stock then
outstanding, amend, alter or repeal any of the
provisions hereof so as to affect adversely the
preferences, special rights or powers of the
Convertible Preferred Stock; or
(c) without the affirmative vote at a
meeting or the written consent with or without a
meeting of the holders of at least a majority in
number of shares of the Series Preferred Stock of all
series then outstanding, increase the authorized
number of shares of the Series Preferred Stock.
(vi) The shares of the Convertible Preferred Stock may be
redeemed at the option of the Corporation as a whole at any time on or
after January 20, 2004, upon not less than 25 or more than 60 days'
prior notice mailed to the holders of the shares to be redeemed at
their addresses as shown on the stock books of the Corporation, at a
redemption price of $38.1875 per share, together with an amount equal
to all dividends (whether or not earned or declared) accumulated and
unpaid to the date fixed for redemption. Upon such redemption date, all
holders of shares of Convertible Preferred Stock shall cease to be
stockholders with respect to such shares and thereafter such shares
shall no longer be transferable on the books of the Corporation and
such holders shall have no interest or claim against the Corporation
with respect to such shares except the right to receive payment of the
redemption price upon surrender of their certificates.
If full cumulative dividends on the Convertible Preferred
Stock have not been paid, the Corporation may not purchase or acquire
any shares of the Convertible Preferred Stock otherwise than pursuant
to a purchase or exchange offer made on the same terms to all holders
of the Convertible Preferred Stock.
(vii) No consent of the holders of the Convertible Preferred
Stock shall be required for (i) the creation of any indebtedness of any
kind of the Corporation, (ii) the creation of any class of stock of the
Corporation ranking junior as to dividends or upon liquidation to the
Series Preferred Stock or (iii) any increase or decrease in the amount
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<PAGE>
of authorized Common Stock or any increase, decrease or change in the
par value thereof or in any other terms thereof.
(viii) The Board reserves the right by subsequent amendment
from time to time to increase (subject to the provisions of paragraph
(v)(II)(c)) or decrease the number of shares which constitute the
Convertible Preferred Stock (but not below the aggregate number of
shares thereof then outstanding or then deliverable upon conversion of
the 2007 Debentures) and in other respects to amend the terms of the
Convertible Preferred Stock within the limitations provided by law,
resolutions of the Board and the Certificate of Incorporation.
12
PURCHASE AGREEMENT
PURCHASE AGREEMENT (the "Agreement") dated as of January 20,
2000 between PAINE WEBBER GROUP INC., a Delaware corporation (the "Company"),
and (the "Employee").
WHEREAS, the Employee wishes to purchase from the Company, and
the Company wishes to issue and sell to the Employee, ___ of the Company's 6.25%
Convertible Debentures Due 2007 (the "Debenture" or "Debentures") in the
aggregate principal amount of $ on the terms set forth herein; and
WHEREAS, the Company has duly authorized the issuance to the
Employee of the Debenture substantially in the form being issued and delivered
to the Employee simultaneously with the execution and delivery of this
Agreement;
NOW, THEREFORE, in consideration of the mutual agreements
contained herein, the parties hereto agree as follows:
1. SALE OF DEBENTURE
In reliance on the representations and agreements
contained herein, simultaneously with the execution and delivery of this
Agreement by the parties hereto the Employee is purchasing from the Company, and
the Company is issuing and selling to the Employee, ___ Debentures at a purchase
price of $________ (the "Purchase Price"). In payment therefor, the Employee is
delivering to the Company a promissory note in an amount equal to 100% of the
Purchase Price. The principal amount due on Note is non-recourse and the
interest thereon is recourse.
2. REPRESENTATIONS AND WARRANTIES OF THE EMPLOYEE
The Employee hereby represents and warrants that:
2.1 Investment Intent. The Debenture, the shares of Series A
Convertible Redeemable Preferred Stock, liquidation value $38.1875 per share, of
the Company (the "Preferred Stock") issuable upon conversion of the Debenture,
and the shares of Common Stock, $1.00 par value per share, of the Company (the
"Common Stock") issuable upon conversion of the Preferred Stock are being or
will be acquired by the Employee solely for his own account for investment and
not with a view to, or any present intention of, distribution thereof.
2.2 Nature of Employee. The Employee has such knowledge in
business and financial matters that he is capable of evaluating the merits and
risks of his investment in the Debenture, the Preferred Stock and the Common
Stock and has had an opportunity to ask questions concerning the Company and the
Debenture, the Preferred Stock and the Common Stock. The Employee has previously
been provided with the most recent copies of the Company's proxy statement, its
Annual Report on Form 10-K for the fiscal year ending December 31, 1999 and the
10(a) Prospectus, dated April 26, 2000 describing this offering of Debentures.
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3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants that:
3.1 Existence and Authority. The Company (i) is a corporation
duly organized and validly existing in good standing under the laws of the State
of Delaware and (ii) has all requisite power and authority to enter into this
Agreement, to issue the Debentures and to carry out its obligations under this
Agreement and the Debentures.
3.2 No Conflict. The execution, delivery and performance of
this Agreement and the Debentures do not and will not conflict with, violate or
result in a default under the certificate of incorporation or by-laws of the
Company or any other agreement or instrument to which the Company is a party or
by which it or any of its property is bound or any law or regulation or require
the consent of any governmental body or other regulatory authority.
3.3 No Default. No default has occurred and is continuing and
no condition exists that, upon the issuance of the Debentures, would constitute
an Event of Default (as defined in the Debenture) or, with the lapse of time or
the giving of notice or both, would become an Event of Default.
3.4 Corporate Proceedings.
(a) The Company has taken all corporate actions
necessary to be taken by it to authorize the execution and delivery of this
Agreement, the issuance and delivery of the Debentures and the performance by it
of all obligations on its part to be performed under this Agreement and the
Debentures.
(b) The Company shall take all corporate action
necessary to be taken by it to establish the Preferred Stock, having the terms
specified in Exhibit A hereto, and to reserve sufficient shares of Preferred
Stock for issuance upon conversion of the Debentures. The shares of Preferred
Stock, when issued, will be duly and validly issued, fully paid and
nonassessable.
(c) The Company shall reserve sufficient shares of
Common Stock, whether authorized but unissued or issued but not outstanding, for
issuance upon conversion of the Preferred Stock that will become issuable on or
after such dates upon conversion of the Debentures. The shares of Common Stock
to be issued upon conversion of the Preferred Stock, when issued, will be duly
and validly issued and fully paid and nonassessable.
4. RESTRICTIONS ON TRANSFER
4.1 Securities Act of 1933. The Debenture and the shares of
Preferred Stock and Common Stock issuable upon conversion of the Debenture and
the Preferred Stock, respectively, may not be sold, transferred or otherwise
disposed of until a registration statement, filed by the Company pursuant to the
1933 Act with respect to such security is declared effective.
4.2 Limited Transfer of Debenture and Preferred Stock. The
Debenture and the shares of Preferred Stock issuable upon conversion of the
Debenture may not be sold, pledged,
2
<PAGE>
transferred or otherwise disposed of, except that they (a) may be transferred by
will or pursuant to the laws of descent and distribution, and (b) may be pledged
as security for funds borrowed to finance or refinance the purchase of the
Debenture.
4.3 Transferees of Debenture and Preferred Stock. All
subsequent holders of the Debenture and the shares of Preferred Stock issuable
upon conversion of the Debentures shall be subject to this Agreement and shall
succeed to all the rights and obligations of the Employee hereunder.
5. COMPANY COVENANTS
The Company covenants and agrees that as long as the
Debenture remains outstanding the Company shall refrain from taking any action,
by amendment of its certificate of incorporation or otherwise, that would impair
the rights of the holders of Preferred Stock (whether or not any Preferred Stock
is at the time outstanding).
6. DEFINITIONS
"Event of Default" shall mean one of the Events of
Default enumerated under the heading "Events of Default; Acceleration" in the
Debenture.
"Person" shall mean any corporation, banking
corporation or association, partnership, trust, estate, individual,
unincorporated business entity or government or agency or political subdivision
thereof.
"Subsidiary" shall mean any corporation, association
or other business entity which is required to be consolidated with the Company
under generally accepted accounting principles.
7 MISCELLANEOUS
7.1 Replacement of Debenture. Upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft, destruction or
mutilation of the Debenture and, in the case of such mutilation, upon surrender
or cancellation of such Debenture, the Company, at its expense, shall execute
and deliver in lieu thereof a new Debenture of like tenor dated the date to
which interest shall have been paid on such Debenture or, if no interest shall
have been so paid, then dated the date of such Debenture.
7.2 Amendment or Waiver. Any amendment or modification of this
Agreement must be in writing and signed by both the Employee and an authorized
officer of the Company. A waiver of any provision of this Agreement must be in
writing and signed by the Employee or an authorized officer of the Company, as
the case may be. No waiver by the Company or the Employee of any breach by the
other party of any condition or provision contained in this Agreement to be
performed by such other party shall be deemed a waiver of a similar or
dissimilar condition or provision at the same or any prior or subsequent time.
3
<PAGE>
7.3 Severability. In the event that any provision or portion
of this Agreement shall be determined to be invalid or unenforceable for any
reason, in whole or in part, the remaining provisions of this Agreement shall be
unaffected thereby and shall remain in full force and effect to the fullest
extent permitted by law.
7.4 Notices. Any notice herein required or permitted to be
given shall be in writing and shall be deemed to have been given when delivered
personally or sent by certified or registered mail, postage prepaid, return
receipt requested, duly addressed to the party concerned at the address
indicated below or to such other address as such party may subsequently give
notice of
If to the Company: Paine Webber Group Inc.
1285 Avenue of the Americas
New York, New York 10019
Attention: Matthew Levitan
If to the Employee: To the Employee at his address as it appears
in the records of the Company
7.5 Headings. The section headings contained in this Agreement
are for convenience only and shall not in any way affect the meaning or
construction of this Agreement.
7.6 Counterparts. This Agreement may be executed in separate
counterparts, all of which taken together shall constitute one and the same
agreement.
7.7 Choice of Law. This Agreement shall be governed by and
construed and interpreted in accordance with the laws of the State of New York,
without reference to principles of conflict of laws.
7.8 Successors and Assigns. Except as otherwise expressly
indicated herein, this Agreement is intended to inure to the benefit of and be
enforceable by the Employee and his beneficiary, estate or other legal
representative and permitted assigns and the Company and its successors and
assigns.
4
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the day and year first written above.
PAINE WEBBER GROUP INC.
By:
----------------------------------
Title:
[Employee]
Exhibit 23.1
Consent of Independent Auditors
We consent to the incorporation by reference in the Registration Statement (Form
S-8) of Paine Webber Group Inc. pertaining to the Paine Webber Group Inc. 6.25%
Convertible Debentures Due 2007 in Connection with the 2000 KEEP Program of our
report dated January 31,2000, with respect to the consolidated financial
statements and schedules of Paine Webber Group Inc. included or incorporated by
reference in its Annual Report (Form 10-K) for the year ended December 31, 1999.
/s/ Ernst & Young
New York, New York
April 26, 2000
Exhibit 23.2
PaineWebber Group Inc.
1285 Avenue of the Americas
New York, NY 10019-6025
212 713-2879
Theodore A. Levine
General Counsel
Senior Vice President
Secretary
[Company Letterhead]
April 25, 2000
Paine Webber Group Inc.
1285 Avenue of the Americas
New York, New York 10019
I am Senior Vice President and General Counsel of and have acted as counsel for
Paine Webber Group Inc., a Delaware corporation (the "Company"), in connection
with the proposed filing with the Securities and Exchange Commission expected to
be made on or about April 26, 2000, under the Securities Act of 1933, as
amended, of a Registration Statement on Form S-8 (the "Registration Statement")
for the purpose of registering $76,375,000 of 6.25% Convertible Debentures due
February 28, 2007 (the "Debentures"); 2,000,000 shares of Series A Convertible
Redeemable Preferred Stock (the "Preferred Stock") and 2,000,000 shares of
Common Stock, $1 par value of the Company (the "Common Stock") in accordance
with the terms of the Paine Webber 2000 KEEP Program (the "Program"). In such
capacity, I have examined the Restated Certificate of Incorporation and By-Laws
of the Company, the Plan, and such other documents of the Company as I have
deemed necessary or appropriate for the purposes of the opinion expressed
herein.
Based upon the foregoing and having regard for such legal considerations as I
have deemed relevant, I am of the opinion that the Debentures, the Preferred
Stock and Common Stock have been duly authorized by the Company and, when (a)
issued and delivered by the Company in accordance with the terms of the Program
and (b) paid for in full in accordance with the terms of the Program, the
Debentures, the Preferred Stock and Common Stock will be issued, fully paid and
non-assessable.
The opinion expressed below is limited to the General Corporation Law of
Delaware, and we do not express any opinion herein concerning any other law.
I consent to the filing of this opinion as an exhibit to the Registration
Statement and to the use of my name wherever appearing in the Registration
Statement and any amendment thereto.
Very truly yours,
/s/ Theodore A. Levine
1
