<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 3, 2000
Post-Effective Amendment No. 1 to Registration Statement No. 333-67647
Registration Statement No. 333-
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
AND
POST-EFFECTIVE AMENDMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
POLAROID CORPORATION
(Exact name of Registrant as specified in its charter)
------------------------------
<TABLE>
<S> <C>
DELAWARE 04-1734655
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
784 MEMORIAL DRIVE
CAMBRIDGE, MASSACHUSETTS 02139
(781) 386-2000
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
------------------------------
NEAL D. GOLDMAN, ESQ.
VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
POLAROID CORPORATION
784 MEMORIAL DRIVE
CAMBRIDGE, MASSACHUSETTS 02139
(781) 386-3228
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
------------------------------
COPY TO:
RAYMOND W. WAGNER, ESQ.
SIMPSON THACHER & BARTLETT
425 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017-3954
(212) 455-2000
------------------------
Approximate date of commencement of proposed sale to the public: From time
to time after the Registration Statement becomes effective as determined by
market conditions and other factors.
------------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
(CONTINUED ON FOLLOWING PAGE)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
(CONTINUED FROM PREVIOUS PAGE)
CALCULATION OF REGISTRATION FEE
<TABLE>
TITLE OF EACH CLASS OF PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
SECURITIES TO BE AMOUNT TO BE AGGREGATE PRICE PER AGGREGATE OFFERING REGISTRATION
REGISTERED REGISTERED (1)(2) SECURITY (2) (3) PRICE (1) (2) (3) FEE (2) (4)
Debt Securities (5)
<S> <C> <C> <C> <C>
Preferred Stock, par value $1.00
per share (6)
Depositary Shares (7)
Common Stock, par value $1.00 per
share (8)
Rights to purchase Series A
Preferred Stock, par value $1.00
per share (9)
Stock Purchase Contracts (10)
Stock Purchase Units (11)
Warrants (12)
Warrant Units (13)
Total $275,000,000 $275,000,000 $275,000,000 $72,600
</TABLE>
(1) The initial public offering price of any securities denominated in any
foreign currencies or currency units shall be the U.S. dollar equivalent
thereof based on the prevailing exchange rates at the respective times such
securities are first offered. For securities issued with an original issue
discount, the amount to be registered is the amount as shall result in
aggregate gross proceeds of $275,000,000.
(2) Pursuant to General Instruction II.D to Form S-3, the Amount to be
Registered, Proposed Maximum Aggregate Price Per Security and Proposed
Maximum Aggregate Offering Price has been omitted for each class of
securities which are registered hereby.
(3) The registration fee has been calculated in accordance with Rule 457(o)
under the Securities Act of 1933, as amended (the "Securities Act"), and
reflects the maximum offering price of securities that may be issued rather
than the principal amount of any securities that may be issued at a
discount.
(4) Pursuant to Rule 429 under the Securities Act, the prospectus included
herein is a combined prospectus that also relates to securities that were
registered by the Registration Statement on Form S-3 (File No. 333-67647)
(the "Prior Registration Statement"). A filing fee of $62,550 was paid on
November, 20 1998 in connection with $225,000,000 aggregate principal amount
of securities that remain eligible to be sold under the Prior Registration
Statement as of February 17, 1999. This registration statement is a new
registration statement and constitutes Post-Effective Amendment No. 1 to the
Prior Registration Statement. Such post-effective amendment shall hereafter
become effective concurrently with the effectiveness of this registration
statement in accordance with Section 8(a) of the Securities Act.
(5) An indeterminate number of debt securities are covered by this registration
statement. Debt securities may be issued (a) separately, (b) as part of
stock purchase units which are registered hereby or (c) upon exercise of
warrants to purchase debt securities which are registered hereby.
(6) An indeterminate number of shares of preferred stock are covered by this
registration statement. Preferred Stock may be issued (a) separately,
(b) as part of stock purchase units or warrant units, each of which are
registered hereby or (c) upon exercise of warrants to purchase shares of
preferred stock which are registered hereby.
(7) An indeterminate number of depositary shares, representing fractional
interests in the preferred stock, are covered by this registration
statement. In the event the registrant elects to offer to the public such
fractional interests, the depositary shares will be issued to a depositary
under a deposit agreement. Depositary shares may be issued (a) separately,
(b) as part of stock purchase units or warrant units, each of which are
registered hereby or (c) upon exercise of warrants to purchase depositary
shares which are registered hereby.
(FOOTNOTES CONTINUED ON FOLLOWING PAGE)
<PAGE>
(FOOTNOTES CONTINUED FROM PRIOR PAGE)
(8) An indeterminate number of shares of common stock, par value $1.00 per
share, are covered by this registration statement. Common stock may be
issued (a) separately, (b) upon the conversion of either the debt securities
or the shares of preferred stock each of which are registered hereby,
(c) upon settlement of the stock purchase contracts which are registered
hereby or (d) upon the exercise of warrants to purchase shares of common
stock which are registered hereby. Shares of common stock issued upon
conversion of the debt securities and the preferred stock will be issued
without the payment of additional consideration.
(9) An indeterminate number of rights to purchase Series A Preferred Stock, par
value $1.00 per share (the "Rights"), are covered by this registration
statement. Prior to the occurrence of certain events, the Rights will not be
exercisable or evidenced separately from shares of common stock. Rights will
be issued without the payment of additional consideration when common stock,
which is registered hereby, is issued.
(10) An indeterminate number of stock purchase contracts are covered by this
registration statement. Each stock purchase contract may be issued
separately or as part of a stock purchase unit. A stock purchase contract
obligates the holder, upon settlement, to purchase an indeterminate number
of shares of common stock and attached Rights. If a stock purchase contract
is issued as part of a stock purchase unit, no separate consideration will
be received for the stock purchase contract.
(11) An indeterminate number of stock purchase units are covered by this
registration statement. Each stock purchase unit consists of (a) a stock
purchase contract, under which the holder, upon settlement, will purchase an
indeterminate number of shares of common stock and attached Rights and
(b) a debt security of the registrant, a share of preferred stock or a
depositary share relating to preferred stock or the debt obligation of a
third party, including a U.S. Treasury security. Each debt security, share
of preferred stock or depositary share or debt obligation of a third party
may be pledged to secure the obligation of the holder to purchase common
stock.
(12) An indeterminate number of warrants, each representing the right to
purchase an indeterminate number of debt securities, shares of preferred
stock, depositary shares, or shares of common stock and attached Rights,
each of which are registered hereby, are covered by this registration
statement.
(13) An indeterminate number of warrant units are covered by this registration
statement. Each warrant unit consists of (a) a warrant under which the
holder, upon exercise, will purchase an indeterminate number of shares of
common stock and attached Rights and (b) any of a debt security, a share of
preferred stock or a depositary share relating to preferred stock.
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE
ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(a), MAY DETERMINE.
------------------------
<PAGE>
Subject to Completion, dated February 3, 2000
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER TO
SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES
IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
<PAGE>
PROSPECTUS
[LOGO]
POLAROID CORPORATION
784 MEMORIAL DRIVE
CAMBRIDGE, MASSACHUSETTS 02139
(781) 386-2000
$275,000,000
DEBT SECURITIES
PREFERRED STOCK
DEPOSITARY SHARES
COMMON STOCK
STOCK PURCHASE CONTRACTS
STOCK PURCHASE UNITS
WARRANTS
WARRANT UNITS
-------------
WE WILL PROVIDE SPECIFIC TERMS OF THESE SECURITIES IN SUPPLEMENTS TO THIS
PROSPECTUS.
YOU SHOULD READ THIS PROSPECTUS AND ANY SUPPLEMENT CAREFULLY BEFORE YOU INVEST.
------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------------
THIS PROSPECTUS IS DATED , 2000.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Summary............................... 1
Where You Can Find More Information
about Polaroid...................... 2
The Company........................... 3
Ratios of Earnings to Fixed Charges... 3
Use of Proceeds....................... 3
Description of Debt Securities........ 4
Limitations on Issuance of Bearer Debt
Securities.......................... 18
</TABLE>
<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Description of Capital Stock.......... 19
Description of Offered Preferred
Stock............................... 26
Description of Stock Purchase
Contracts and Stock Purchase
Units............................... 30
Description of Warrants and Warrant
Units............................... 30
Plan of Distribution.................. 32
Experts............................... 33
Legal Opinions........................ 33
</TABLE>
i
<PAGE>
SUMMARY
This summary highlights selected information from this prospectus and does
not contain all of the information that is important to you. To understand the
terms of our securities, you should carefully read this document with the
applicable prospectus supplement. Together, these documents will give the
specific terms of the securities we are offering. You should also read the
documents we have incorporated by reference in this prospectus described below
under "Where You Can Find More Information About Polaroid".
THE SECURITIES WE MAY OFFER
This prospectus is part of a registration statement that we filed with the
SEC utilizing a "shelf" registration process. Under this shelf registration, we
may offer from time to time up to $275,000,000 of any of the following
securities, either separately or in units with other securities:
- debt securities;
- preferred stock;
- depositary shares;
- common stock;
- stock purchase contracts relating to the common stock; and
- warrants.
This prospectus provides you with a general description of the securities we may
offer. Each time we offer securities, we will provide you with a prospectus
supplement that will describe the specific amounts, prices and other terms of
the securities being offered. The prospectus supplement may also add, update or
change information contained in this prospectus.
DEBT SECURITIES
We may offer unsecured general obligations of Polaroid, which may be either
senior or subordinate and may be convertible into shares of our common stock. In
this prospectus, we refer to the senior debt securities and the subordinated
debt securities together as the "debt securities". The senior debt securities
will have the same rank as all of our other unsecured and unsubordinated debt.
The subordinated debt securities will be entitled to payment only after payment
on our senior debt.
The debt securities will be issued under an indenture between us and State
Street Bank and Trust Company, as the trustee. We have summarized general
features of the debt securities from the indenture. We encourage you to read the
indenture which is an exhibit to the registration statement.
PREFERRED STOCK AND DEPOSITARY SHARES
We may issue our preferred stock, $1.00 par value per share, in one or more
series. Our board of directors will determine the dividend, voting, conversion
and other rights of the series of preferred stock being offered. We may also
issue fractional shares of the preferred stock that will be represented by
depositary shares and depositary receipts.
COMMON STOCK
We may issue our common stock, par value $1.00 per share. Holders of common
stock are entitled to receive dividends when declared by the board of directors,
subject to the rights of holders of preferred stock, and include rights to
purchase shares of our Series A Preferred Stock as described below. Each holder
of common stock is entitled to one vote per share. The holders of common stock
have no preemptive rights or cumulative voting rights.
STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS
We may issue stock purchase contracts for the purchase of our common stock.
We also may issue stock purchase units, each of which will consist of:
- a stock purchase contract and
- a debt security of Polaroid, a share of preferred stock of Polaroid or a
depositary share relating to preferred stock of Polaroid or a debt
obligation of a third party, including a U.S. Treasury security.
Our debt security, share of preferred stock or depositary share relating to
preferred stock or the debt obligation of a third party may be
1
<PAGE>
pledged by the holder as collateral to secure the holder's obligation to
purchase common stock under the stock purchase contract. Our board of directors
will determine the terms of the offering, including the terms of the stock
purchase contracts and information about the security or obligation that will
secure the holder's obligation to purchase common stock.
WARRANTS AND WARRANT UNITS
We may issue warrants for the purchase of debt securities, preferred stock,
depositary shares or common stock. We may issue warrants independently or
together with other securities.
We also may issue warrant units. Each warrant unit will consist of (1) a
warrant under which the holder, upon exercise, will purchase a specified number
of shares of common stock and (2) any of a debt security, share of preferred
stock or depositary share relating to preferred stock.
WHERE YOU CAN FIND MORE INFORMATION ABOUT POLAROID
We file annual, quarterly and current reports, proxy statements and other
information with the SEC. You may also read and copy any document we file at the
SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information
on the public reference rooms. Our SEC filings are available to the public over
the Internet at the SEC's web site at http://www.sec.gov and at our web site at
http://www.polaroid.com.
The SEC allows us to "incorporate by reference" the information we file with
them, which means that we can disclose important information to you by referring
you to those documents. The information incorporated by reference is considered
to be a part of this prospectus, and information that we file later with the SEC
will automatically update and supersede this information. We incorporate by
reference the documents listed below and any future filings made with the SEC
under Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of 1934
until we sell all of the securities:
- Annual Report on Form 10-K for the year ended December 31, 1998;
- Quarterly Reports on Form 10-Q for the quarterly periods ended March 28,
1999, June 27, 1999 and September 26, 1999;
- Current Reports on Form 8-K filed on January 28, 1999, on February 17,
1999 and on January 5, 2000; and
- the description of rights to purchase our Series A Participating
Cumulative Preferred Stock contained in our registration statement on
Form 8-A dated September 14, 1986, as amended by amendments contained in
exhibits to our registration statements on Form 8-A dated August 18, 1988,
September 15, 1988, January 30, 1989, February 21, 1989, October 21, 1991,
March 24, 1993, July 2, 1993, and to our registration statement on
Form 8-A/A dated July 13, 1998.
You may request a copy of these filings at no cost, by writing or
telephoning our agent at the following address:
Boston EquiServe, L.P.
150 Royal Street
Canton, Massachusetts 02021
Telephone: 800-730-4001
Because we list our common stock on the New York Stock Exchange, you may
also inspect the filings described above, as well other information, at the
offices of the New York Stock Exchange, 20 Broad Street, New York, New York
10005.
YOU SHOULD RELY ONLY ON THE INFORMATION INCORPORATED BY REFERENCE OR
PROVIDED IN THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT. WE HAVE NOT AUTHORIZED
ANYONE ELSE TO PROVIDE YOU WITH DIFFERENT INFORMATION. WE ARE NOT MAKING AN
OFFER OF THESE SECURITIES IN ANY STATE WHERE THE OFFER IS NOT PERMITTED. YOU
SHOULD NOT ASSUME THAT THE INFORMATION IN THIS PROSPECTUS OR ANY PROSPECTUS
SUPPLEMENT IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT OF THOSE
DOCUMENTS.
2
<PAGE>
THE COMPANY
Polaroid, with annual sales of approximately $2 billion, is the worldwide
leader in instant imaging. We supply instant photographic cameras and films;
digital imaging hardware, software and media; secure identification systems;
sunglasses and polarizers to markets worldwide.
Our principal executive offices are located at 784 Memorial Drive,
Cambridge, Massachusetts 02139. Our telephone number is (781) 386-2000. When we
refer to "Polaroid", "we" or "our" in this prospectus, we mean Polaroid
Corporation and its subsidiaries on a consolidated basis, unless the context
requires otherwise.
RATIO OF EARNINGS TO FIXED CHARGES
The following table shows the consolidated ratio of earnings to fixed
charges of Polaroid for each of the five most recent fiscal years. Fixed charges
consist of interest expense (including amortization of deferred financing
costs), the portion of rental expense that is representative of the interest
factor (deemed by us to be one-third) and capitalized interest.
<TABLE>
<CAPTION>
FOR THE NINE
MONTHS ENDED
FISCAL YEAR ENDED DECEMBER 31, SEPT. 26,
---------------------------------------------------- ------------
1994 1995 1996 1997 1998 1999
-------- -------- -------- -------- -------- ------------
<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges................ 3.3 (a) 1.4(b) (c) (d) (e)
</TABLE>
- ------------------------
(a) Earnings were insufficient to cover fixed charges by $206.2 million after
giving effect to the pre-tax expense for restructuring and other charges of
$247.0 million. Excluding the pre-tax restructuring and other charges, the
ratio of earnings to fixed charges was 1.6x.
(b) In 1996, we recorded a pre-tax expense for restructuring and other special
charges of $150.0 million ($7.0 million of which was recorded in cost of
goods sold). Excluding the pre-tax restructuring and other special charges,
the ratio of earnings to fixed charges was 3.8x.
(c) Earnings were insufficient to cover fixed charges by $194.5 million after
giving effect to the pre-tax expense for restructuring and other charges of
$340.0 million ($16.5 million of which was recorded in cost of goods sold).
Excluding the pre-tax restructuring and other charges, the ratio of earnings
to fixed charges was 3.4x.
(d) Earnings were insufficient to cover fixed charges by $41.1 million after
giving effect to the pre-tax expense for restructuring of $50.0 million.
Excluding the pre-tax restructuring, the ratio of earnings to fixed charges
was 1.1x.
(e) Earnings were insufficient to cover fixed charges by $32.5 million. Earnings
include the impact of non-cash charges of $35 million related to the sale of
the Helios medical diagnostic imaging equipment line and $33 million related
to the graphics arts business.
USE OF PROCEEDS
We will use the net proceeds that we receive from the sale of the securities
offered by this prospectus and the accompanying prospectus supplement for
general corporate purposes. General corporate purposes may include repayment of
other debt, capital expenditures, possible acquisitions, repurchase of
Polaroid's stock and any other purposes that may be stated in any prospectus
supplement. The net proceeds may be invested temporarily or applied to repay
short-term debt until they are used for their stated purpose.
3
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The following description of the terms of the debt securities summarizes
some general terms that will apply to the debt securities. The description is
not complete, and we refer you to the indenture, a copy of which we filed with
the SEC as an exhibit to the registration statement of which this prospectus is
a part.
The debt securities will be either senior debt securities or subordinated
debt securities of Polaroid. We will issue debt securities under an indenture,
dated as of January 9, 1997, between Polaroid and State Street Bank and Trust
Company, as trustee, as supplemented by a supplemental indenture, that Polaroid
will enter into with the trustee. We refer to the indenture and supplemental
indenture collectively as the "indenture" throughout the remainder of this
prospectus unless the context indicates otherwise. The indenture provides for
the issuance from time to time of debt securities in an unlimited dollar amount
and an unlimited number of series.
For your reference, in several cases below we have noted the section in the
indenture that the paragraph summarizes. Capitalized terms have the meanings
assigned to them in the indenture. The referenced sections of the indenture and
the definitions of capitalized terms are incorporated by reference in the
following summary.
SPECIFIC TERMS OF EACH SERIES
Each time that we issue a new series of debt securities, the prospectus
supplement relating to that new series will specify the particular amount, price
and other terms of these debt securities. These terms may include:
- the title of the debt securities;
- whether the debt securities will be senior unsecured obligations of
Polaroid, or its subordinated unsecured obligations;
- any limit on the total principal amount of the debt securities;
- the date or dates on which the principal of and premium on the debt
securities will be payable or their method of determination;
- the interest rate or rates of the debt securities or their method of
determination; the date from which interest will accrue; the interest
payment dates for the debt securities; and the regular record dates;
- the place or places where the principal of and premium and interest on the
debt securities will be paid;
- the period or periods within which, the price or prices at which and the
terms on which any of the debt securities may be redeemed, in whole or in
part at our option;
- the terms on which Polaroid would be required to redeem debt securities
pursuant to any sinking fund or analogous provisions, on the occurrence of
some event or at the option of a holder of debt securities; and the period
or periods within which, the price or prices at which and the terms and
conditions on which the debt securities will be so redeemed, repaid or
purchased in whole or in part;
- whether the debt securities will be convertible into our common stock or
other securities of Polaroid or exchangeable for securities of any other
person;
- the terms for the attachment to debt securities of warrants, options or
other rights to purchase or sell stock or other securities of Polaroid;
- the portion of the principal amount of the debt securities that is payable
on the declaration of acceleration of the maturity other than their
principal amount (these debt securities are referred to as "OID debt
securities" and are described below);
- whether and to what extent any other means of satisfaction and discharge,
or "defeasance", will be applicable to the debt securities other than as
described
4
<PAGE>
below under "Satisfaction and Discharge; Defeasance";
- any modifications to the events of default, described below under "Events
of Default, Notice and Waiver";
- any modification to the covenants described below under "Certain
Covenants";
- the currency or currencies or currency unit or currency units in which the
debt securities will be denominated or in which payment of the principal
of and premium and interest on any of the debt securities will be issued,
if other than U.S. dollars;
- if the principal of and premium or interest on any of the debt securities
is to be payable at our election or at the election of a holder of the
debt securities or in a currency or currencies or currency unit or
currency units other than that in which the debt securities are
denominated, the period or periods within which and the terms and
conditions on which these elections may be made, or the other
circumstances under which the debt securities are to be payable; these
provisions may also require the holder of the debt securities to bear
currency exchange costs by deduction from these payments;
- if the amount of principal of and premium or interest on any of the debt
securities may be determined by reference to an index based on either a
currency or currencies or a currency unit or currency units other than
that in which the debt securities are payable or any other method
specifying the manner in which these amounts will be determined;
- if the debt securities and coupons are to be issued on the exercise of
warrants, the time, manner and place for these debt securities and coupons
to be authenticated and delivered;
- whether and under what circumstances we will pay additional amounts on any
of the debt securities and coupons to any holder of debt securities who is
not a U.S. person (including a definition of this term) for any tax,
assessment or governmental charge withheld or deducted and whether we will
have the option to redeem these debt securities rather than pay additional
amounts;
- the person to whom interest on debt securities in registered form will be
payable, if other than the person in whose name those debt securities are
registered at the close of business on the regular record dates; the
manner in which, or the person to whom, any interest on any Bearer
Security of the series will be payable, if other than on presentation and
surrender of the coupons attached to that security as they mature; and the
extent to which, or the manner in which, any interest payable on a
temporary global debt security on an interest payment date will be paid;
and
- any other specific terms of the debt securities that are not inconsistent
with the indenture.
(Section 2.2)
We may issue debt securities as OID debt securities. OID debt securities
bear no interest or bear interest at below-market rates and are sold at a
discount below their stated principal amount. The prospectus supplement will
contain any special tax, accounting or other information relating to OID debt
securities or to various other kinds of debt securities that may be offered,
including debt securities linked to an index or payable in a currency or
currencies other than U.S. dollars.
RANKING
SENIOR DEBT SECURITIES
The senior debt securities will be the senior, unsecured obligations of
Polaroid and will rank equally in right of payment with all of Polaroid's
present and future senior unsecured and unsubordinated debt.
5
<PAGE>
SUBORDINATED DEBT SECURITIES
The subordinated debt securities will be the unsecured and subordinated
obligations of Polaroid and will rank junior in right of payment with present
and future senior debt of Polaroid.
For purposes of the above definitions of senior debt securities and
subordinated debt securities, "senior debt" means the principal, premium, if
any, and interest on:
- all debt of Polaroid, whether outstanding on or after the date of the
issuance of any debt securities which is for money borrowed, or evidenced
by a note or similar instrument given in connection with the acquisition
of any business, properties or assets, including securities;
- any debt of others of the kinds described in the preceding clause for the
payment of which Polaroid is responsible or liable, directly or
indirectly, contingently or otherwise, or as guarantor or otherwise; and
- amendments, renewals, extensions and refundings of any debt described
above,
unless it is expressly provided that the debt is not superior in right of
payment to the debt securities of any series.
CONVERSION OR EXCHANGE RIGHTS
The debt securities may be convertible into shares of our common stock or
exchangeable for common stock of another person. If the debt securities are
convertible, the terms and conditions of conversion will be stated in the
applicable prospectus supplement. The terms will include:
- the conversion price or the factors that will be relevant in determining
the conversion price;
- the period during which the debt securities are convertible;
- provisions regarding our ability or the ability of a holder of debt
securities to convert the debt securities into shares of our common stock;
- events requiring adjustments to the conversion price; and
- provisions affecting the ability to convert debt securities in the event
of our redemption of debt securities.
If the debt securities are exchangeable, the terms of the exchange similar
to those applicable to convertible debt securities will be stated in the
applicable prospectus supplement.
FORM AND DENOMINATION
We may issue debt securities of a series in fully registered form without
coupons, in bearer form either with or without coupons or any combination of
those forms. (Section 2.2) The prospectus supplement will state whether the
bearer debt securities may be exchanged for registered debt securities. The
prospectus supplement will also state whether the debt securities will initially
be issued in temporary global form or in definitive form. (Sections 4.3, 4.4,
4.11 and 4.12)
We will issue debt securities in the form of registered debt securities in
denominations of $1,000 or multiples thereof and debt securities in the form of
bearer debt securities in denominations of $5,000, unless the prospectus
supplement states otherwise. (Section 4.1)
CERTAIN COVENANTS
The indenture includes the following covenants. These covenants use terms
that are defined below following the summary of these covenants.
RESTRICTIONS ON SECURED DEBT
If Polaroid or any Restricted Subsidiary incurs or guarantees any debt for
money borrowed ("Debt") that is secured by a mortgage, pledge or lien
("Mortgage") on any Principal Property or on any shares of stock or Debt of any
Restricted Subsidiary, then Polaroid will secure, or cause that Restricted
Subsidiary to secure, the debt securities to the same extent and in the same
proportion with, or, at Polaroid's option, prior to, that secured Debt. This
restriction does not apply, however, if the total amount of this secured Debt,
together with
6
<PAGE>
all Attributable Debt of Polaroid and its Restricted Subsidiaries that is
incurred by sale/ leaseback transactions involving Principal Properties (with
the exception of the transactions which are excluded as described below under
"Restrictions on Sale/ Leaseback Transactions") is less than or equal to 10% of
Consolidated Net Tangible Assets. (Section 11.4)
The above restrictions do not apply to, and the calculation of secured Debt
under these restrictions does not include, Debt secured by any of the following:
- Mortgages on property of, or on any shares of stock of or Debt of, any
corporation existing at the time that that corporation becomes a
Restricted Subsidiary;
- Mortgages in favor of Polaroid or a Restricted Subsidiary;
- Mortgages in favor of governmental bodies to secure progress or advance
payments;
- Mortgages on property, shares of stock or Debt existing at the time of the
acquisition of these items, including acquisition through merger or
consolidation, and purchase money and construction Mortgages which are
entered into prior to, at the time of or within 180 days after the later
of acquisition or completion of construction;
- any extension, renewal or refunding of any Mortgage referred to in the
preceding six exceptions, provided that any extended, renewed or replaced
Mortgage shall be limited to the same property, stock or Debt that secured
the original Mortgage; and
- Mortgages securing industrial revenue or pollution control bonds.
(Section 11.4)
RESTRICTIONS ON SALE/LEASEBACK TRANSACTIONS
Neither Polaroid nor any Restricted Subsidiary may enter into any
sale/leaseback transaction involving any Principal Property, unless the total
amount of all Attributable Debt from these transactions plus all Debt secured by
Mortgages on Principal Properties (with the exception of secured Debt which is
excluded from Debt as described above under "Restrictions on Secured Debt") is
less than or equal to 10% of Consolidated Net Tangible Assets. (Section 11.5)
The above restrictions do not apply to, and the calculation of Attributable
Debt under these restrictions does not include, any sale/leaseback transaction
if:
- the lease is for a period, including renewal rights, of not more than
three years;
- the sale or transfer of the Principal Property is made prior to, at the
time of or within 180 days after its acquisition or construction thereon;
- the lease secures or relates to industrial revenue or pollution control
bonds;
- the transaction is between Polaroid and a Restricted Subsidiary or between
Restricted Subsidiaries; or
- within 180 days after the sale or transfer is completed, Polaroid or the
Restricted Subsidiary applies an amount at least equal to the greater of:
-- the net proceeds of the sale of the Principal Property leased back
in the sale/leaseback transaction; and
-- the fair market value of the Principal Property leased back in the
sale/leaseback transaction,
to any of (1) the retirement of debt securities or other Funded Debt of
Polaroid ranking equally with or senior to all the debt securities,
(2) the retirement of Funded Debt of a Restricted Subsidiary or (3) the
purchase of other property that constitutes a Principal Property having a
fair market value at least equal to the value of the Principal Property
leased back. The amount to be applied to the retirement of Funded Debt of
Polaroid or a Restricted Subsidiary is to be reduced
7
<PAGE>
by (1) the principal amount of any debt securities and other debt
constituting Funded Debt of Polaroid or a Restricted Subsidiary delivered
to the applicable trustee for retirement and cancellation within this
180-day period and (2) the principal amount of Funded Debt voluntarily
retired within this 180-day period, other than those items listed in
clause (1) of this sentence. This exception does not apply to debt that is
paid at maturity or pursuant to any mandatory sinking fund payment or any
mandatory prepayment provision.
(Section 11.5)
CERTAIN DEFINITIONS
The covenants which we have summarized above use the following terms:
"Restricted Subsidiary" means a Subsidiary, substantially all of whose
property is located or substantially all of whose business is carried on within
the United States and which owns a "Principal Property" but does not include a
Subsidiary which is primarily engaged in (a) the development and sale or
financing of real property or (b) financing, or assisting in financing, the
acquisition or disposition of products of Polaroid or a Subsidiary by dealers,
distributors or customers. (Section 1.1)
"Subsidiary" means a corporation, at least a majority of whose outstanding
voting stock is, at the time, owned, directly or indirectly, by Polaroid and/or
one or more Subsidiaries. (Section 1.1)
"Principal Property" means any real estate or any manufacturing or
processing plant or warehouse owned or leased by Polaroid or by any Restricted
Subsidiary that is located within the United States and the gross book value of
which (without deduction of any depreciation reserves) on the date on which the
determination is being made exceeds 2% of Consolidated Net Tangible Assets. It
does not include either (a) properties which in the opinion of our board of
directors are not of material importance to our business as an entirety or
(b) any portion of any particular property which our board of directors
determines is not of material importance to the use or operation of this
property. (Section 1.1)
"Attributable Debt" means the total net amount of rent required to be paid
during the remaining term of certain leases, discounted at the rate per annum
borne by the relevant debt securities. (Section 1.1)
"Consolidated Net Tangible Assets" means the total assets, less applicable
reserves and other properly deductible items, on Polaroid's balance sheet less
(a) all current liabilities and (b) goodwill, trade names, trademarks, patents,
organization expenses and other similar intangibles of Polaroid and its
consolidated Subsidiaries. (Section 1.1)
"Funded Debt" means (a) debt for money borrowed having a maturity of more
than 12 months, or renewable or extendible beyond 12 months and (b) rental
obligations payable more than 12 months from that date under leases which are
capitalized in accordance with generally accepted accounting principles. These
rental obligations are to be included as Funded Debt at the amount capitalized
and are to be included for the purposes of the definition of Consolidated Net
Tangible Assets both as an asset and Funded Debt at the amount capitalized.
(Section 1.1)
NO EVENT RISK COVENANT
The indenture does not contain any covenants or other provisions that give
holders of the debt securities protection in the event of a highly leveraged
transaction involving Polaroid, except for the "Restrictions on Secured
Indebtedness" and "Restrictions on Sale/ Leaseback Transactions" described
above.
LIMITATION ON MERGER, CONSOLIDATION AND CERTAIN SALES OF ASSETS
We may not merge into or consolidate with any other corporation, or convey
or transfer our properties and assets substantially as an entirety to any person
unless:
- the successor is a U.S. corporation;
8
<PAGE>
- the successor assumes on the same terms and conditions all the obligations
under the debt securities and the indenture; and
- immediately after giving effect to the transaction, there is no default
under the indenture.
(Section 9.1) Upon any merger, consolidation, conveyance or transfer, the
successor will succeed to, and will be substituted in lieu of, Polaroid.
(Section 9.2)
POSSIBLE WAIVER OF CERTAIN COVENANTS
We will not be required to comply with the restrictive covenants described
above under "Restrictions on Secured Debt" and "Restrictions on Sale/Leaseback
Transactions", if the holders of at least a majority in principal amount of all
series of outstanding debt securities affected by that covenant, acting as one
class, waive compliance with it. (Section 11.7)
COMPUTATION OF INTEREST
We will calculate the interest that is due on the debt securities based on a
360-day year of twelve 30-day months, unless the prospectus supplement states
otherwise.
PAYMENT AND PAYING AGENTS
PAYMENTS ON REGISTERED DEBT SECURITIES
We will pay principal of and premium and interest on registered debt
securities in the designated currency or currency unit at the office of a paying
agent or paying agents as we designate from time to time. At our option, we may
pay interest on registered debt securities by check mailed to the address of the
person that appears in the security register. We will pay installments of
interest on any registered debt security to the person in whose name the
registered debt security is registered at the close of business on the regular
record date for such payments. (Sections 4.6 and 4.1)
PAYMENTS ON BEARER DEBT SECURITIES
We will pay principal of and premium and interest on bearer debt securities
in the designated currency unit at the offices of those paying agents outside
the United States as we may designate from time to time. We will pay principal
and premium on bearer debt securities only against surrender of these debt
securities, and we will pay interest on bearer debt securities with coupons only
against surrender of the coupon relating to the particular interest payment
date. (Sections 4.1 and 11.2). We will not make a payment on any bearer debt
security at our office or agency in the United States or by check mailed to any
address in the United States or by transfer to any account maintained with a
bank located in the United States. Notwithstanding the above, we will make
payments on bearer debt securities denominated and payable in U.S. dollars at
the office of Polaroid's paying agent in New York City, if payment of the full
amount thereof in U.S. dollars at all offices or agencies outside the United
States is not lawful or effectively precluded by exchange controls or other
similar restrictions. (Section 11.2)
PAYMENTS OF UNCLAIMED MONEYS
All moneys that we have deposited with the trustee or a paying agent or then
held by us (in trust for the payment of principal of or premium and interest on
any debt security or coupon) which remain unclaimed two years after that payment
becomes due and payable will be repaid to Polaroid or, if then held by Polaroid,
discharged from that trust. In that event, the holder of that debt security or
coupon will be able to look only to Polaroid for payment of these moneys.
(Section 11.3)
PAYING AGENT
State Street Bank and Trust Company will be designated as Polaroid's paying
agent unless the prospectus supplement states otherwise. The office of State
Street Bank and Trust Company, N.A., an affiliate of State Street Bank and Trust
Company, will be the office or agency of Polaroid in New York City where
(1) debt securities that are issuable solely as registered debt securities and
(2) debt securities (subject to the limitations described above in the case of
bearer debt securities) that are issuable solely as bearer debt securities or as
both registered debt
9
<PAGE>
securities and bearer debt securities may be presented or surrendered for
payment. We will name any paying agents outside the United States and any other
paying agents in the United States in the prospectus supplement. (Section 11.2)
At any time, we may designate additional paying agents or rescind the
designation of any paying agent or approve a change in the office through which
any paying agent acts, subject to the limitations described in the indenture.
(Section 11.2)
EXCHANGE, REGISTRATION AND TRANSFER
EXCHANGE
Holders of debt securities may present their securities for exchange under
the following conditions:
- Holders of registered debt securities of any series may exchange their
securities for an equal principal amount of other registered debt
securities of different authorized denominations of the same series and
with the same terms.
- Holders of debt securities of a series that are issuable as both
registered debt securities and bearer debt securities may exchange the
bearer debt securities of that series for an equal principal amount of
registered debt securities of the same series of any authorized
denominations and with the same terms. These debt securities must be
exchanged with all unmatured coupons, except as provided below, and all
matured coupons in default.
- If a holder of a bearer debt security with coupons attached surrenders
that security in exchange for a registered debt security after a record
date but before the relevant interest payment date, then interest will not
be payable on that interest payment date on the registered debt security
issued in exchange for the bearer debt security. Instead, interest will be
payable only to the holder of the coupon issued with the bearer debt
security on that interest payment date.
- Holders of bearer debt securities may not exchange them for registered
debt securities, unless the applicable prospectus supplement describes
that they may do so and applicable rules and regulations permit that
exchange.
Holders of debt securities will not be charged a service charge for any
transfer or exchange, but we may require payment of a sum sufficient to cover
any tax or other governmental charge in connection with that transfer or
exchange. (Section 4.4)
REGISTRATION AND TRANSFER
Holders of registered debt securities (other than book-entry debt securities
which are discussed below) may present their securities for registration of
transfer at the office of the security registrar or at the office of any
additional transfer agent designated by us. The form of transfer endorsed
thereon must be duly executed. (Sections 4.4 and 11.2) State Street Bank and
Trust Company will be the initial security registrar under the indenture. State
Street Bank and Trust Company, N.A., an affiliate of State Street Bank and Trust
Company will initially be designated as the office or agency of Polaroid in New
York City where holders of debt securities may present their debt securities for
registration of transfer or exchange. State Street Bank and Trust Company, N.A.
currently has offices at 61 Broadway, 15(th) Floor, New York, New York 10006.
(Section 4.4)
At any time, we may designate, or rescind the designation of, the security
registrar or any additional transfer agent or approve a change in the location
through which the security registrar or any transfer agent acts. However, if
debt securities of a series are issuable solely as registered debt securities,
then we will be required to maintain a transfer agent in each place of payment
for that series. Similarly, if debt securities are issuable as both registered
debt securities and bearer debt securities or solely as bearer debt securities,
then we will be also required to maintain a transfer agent in a place of payment
for that series located outside of the United States. At any time, we may
10
<PAGE>
designate additional transfer agents for any series of debt securities.
(Section 11.2)
If we redeem in part any series of debt securities, we will not be required
to issue, register the transfer of and/or exchange debt securities under the
following conditions.
- If debt securities of a series are issuable only as registered debt
securities, we will not be required to issue, register the transfer of or
exchange debt securities of any series during a period beginning at the
opening of business 15 business days before any selection of debt
securities of that series to be redeemed and ending at the close of
business on the day of mailing of the relevant notice of redemption.
- If debt securities of the series are issuable as bearer debt securities,
we will not be required to issue, register the transfer of or exchange
debt securities of any series during a period beginning at the opening of
business 15 business days before any selection of debt securities of that
series to be redeemed and ending at the close of business on the day of
the first publication of the relevant notice of redemption.
- If debt securities of a series are issuable as both bearer debt securities
and as registered debt securities and there is no publication, we will not
be required to issue, register the transfer of or exchange debt securities
of any series during a period beginning at the opening of business 15
business days before any selection of debt securities of that series to be
redeemed and ending at the close of business on the day of mailing of the
relevant notice of redemption.
- We will not be required to register the transfer of, or exchange any
registered debt securities selected for redemption, in whole or in part,
except the unredeemed portion of any registered debt securities being
redeemed in part.
- We will not be required to exchange any bearer debt securities selected
for redemption, except to exchange bearer debt securities for registered
debt securities of that series and of like terms that are simultaneously
surrendered for redemption.
(Section 4.4) For a description of restrictions on the exchange, registration
and transfer of global debt securities, see "Global Securities".
GLOBAL SECURITIES
We may issue debt securities of a series in whole or in part as one or more
global debt securities in the following two kinds of forms:
- in either registered or bearer form; and
- in either temporary or definitive form.
We summarize each of these forms below as well as the depositary
arrangements that we anticipate will apply to them.
DEPOSITARY ARRANGEMENTS
The trustee will deposit the global debt securities of a series with, or on
behalf of, a depositary located in the United States (a "U.S. Depositary") or a
common depositary located outside the United States (a "Common Depositary") for
the benefit of the Euro-clear System ("Euro-clear") or Cedelbank for credit to
the respective accounts of the beneficial owners of interests in these debt
securities. All temporary or definitive global debt securities in bearer form
will be deposited with a Common Depositary. (Section 4.3)
The prospectus supplement will describe the specific terms of the depositary
arrangement for debt securities of a series that are issued in global form. None
of Polaroid, the Trustee, any paying agent or the security registrar will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests in a global debt
security or for maintaining, supervising or reviewing any records relating to
these beneficial ownership interests. (Section 4.11) We anticipate that the
following provisions will apply to all depositary arrangements with a U.S.
Depositary or a Common Depositary.
11
<PAGE>
TEMPORARY GLOBAL SECURITIES
If the prospectus supplement specifies, all or any portion of the debt
securities of a series that are issuable as bearer debt securities initially
will be represented by one or more temporary global debt securities, without
interest coupons. These bearer debt securities in temporary form will be
deposited with a Common Depositary in London for Morgan Guaranty Trust Company
of New York, Brussels Office, as operator of Euro-clear, and Cedelbank for
credit to the respective accounts of the beneficial owners of these debt
securities or to other accounts as they may direct. On and after the date set
for the exchange of these temporary securities, each temporary global debt
security will be exchangeable for definitive debt securities in any of the
following three forms or any combination:
- in bearer form;
- in registered form; or
- in definitive global bearer form.
Bearer debt securities, including debt securities in definitive global
bearer form, which are to be delivered in exchange for a portion of temporary
global debt securities, will not be mailed or otherwise delivered to any
location in the United States in connection with that exchange. (Sections 4.2
and 4.3)
Unless the prospectus states otherwise, we will pay interest on that portion
of temporary global debt securities that is due before the issuance of
definitive debt securities to Euro-clear or Cedelbank for that portion of the
temporary global debt securities held for its account. As a condition of making
that payment, we will require that Euro-clear or Cedelbank deliver to the
trustee a certificate signed by Euro-clear or Cedelbank dated no earlier than
that interest payment date. The certificate must be based on statements provided
to it by its account holders who are beneficial owners of interests in those
temporary global debt securities. The certificate must state either of the
following:
- that that portion of temporary global debt securities that is due before
the issuance of definitive debt securities (1) is not beneficially owned
by a "U.S. person" and (2) has not been acquired by or on behalf of a U.S.
person or for offer to resell or for resale to a U.S. person or any person
inside the United States; or
- if a beneficial interest in that portion has been acquired by a U.S.
person, (1) that person is a financial institution (as defined in the U.S.
Treasury Regulations promulgated under the Internal Revenue Code of 1986),
purchasing for its own account or has acquired the debt security through a
financial institution and (2) that these debt securities are held by a
financial institution that has agreed in writing to comply with the
requirements of Section 165(j)(3)(A), (B) or (C) of the Code and the U.S.
Treasury Regulations and that it did not purchase for offer to resell or
for resale inside the United States.
For the purposes of the certificate referred to above, a "U.S. person" means
a citizen or resident of the United States, a corporation or partnership created
or organized in or under the laws of the United States or an estate or trust the
income of which is subject to U.S. federal income taxation regardless of its
source.
Euro-clear or Cedelbank will credit the interest received by it regarding
these temporary global debt securities to the accounts of their beneficial
owners or to other accounts as these beneficial owners may direct.
(Section 4.3)
DEFINITIVE GLOBAL SECURITIES
BEARER DEBT SECURITIES. If any debt securities of a series are issuable in
definitive global bearer form, the prospectus supplement will describe the
circumstances under which beneficial owners of interests in any of these
definitive global bearer debt securities may exchange these interests for debt
securities of that series and of like term and principal amount in any
authorized form and denomination. Bearer debt securities delivered in exchange
for a portion of definitive global debt securities will not be mailed or
otherwise delivered to any location in the United States in connection with that
exchange. (Section 4.4) We will pay
12
<PAGE>
principal of and premium and interest on definitive global bearer debt
securities in the manner described in the prospectus supplement.
BOOK-ENTRY DEBT SECURITIES. If debt securities of a series are to be
represented by one or more definitive global registered debt securities to be
deposited with or on behalf of a U.S. Depositary, then these definitive global
debt securities will be registered in the name of the U.S. Depositary or its
nominee. Book-entry debt securities are subject to the following procedures and
rules:
- Following the issuance of definitive global debt securities registered in
the name of the U.S. Depositary, the U.S. Depositary will credit, on its
book-entry registration and transfer system, the principal amounts of the
book-entry debt securities represented by those global debt securities to
the accounts of institutions that have accounts with that depositary or
its nominee ("participants"). The accounts to be credited will be
designated by the underwriters or agents for the sale of these book-entry
debt securities or by us, if we sell debt securities directly.
- Ownership of book-entry debt securities will be limited to participants or
persons that may hold interests through participants. Ownership of
book-entry debt securities will be shown on, and the transfer of that
ownership will be effected only through, records maintained by the U.S.
Depositary or its nominee for the applicable definitive global debt
securities or by participants or persons that hold through participants.
So long as the U.S. Depositary, or its nominee, is the registered owner of
those global debt securities, that depositary or its nominee will be
considered the sole owner or holder of the book-entry debt securities
represented by those global debt securities for all purposes under the
indenture.
- We will pay principal, premium and interest on book-entry debt securities
to the U.S. Depositary or its nominee as the registered owner or the
holder of the global debt securities representing those book-entry debt
securities.
- Owners of book-entry debt securities will not be entitled to have those
debt securities registered in their names in the security register, will
not receive or be entitled to receive physical delivery of those debt
securities in definitive form and will not be considered the owners or
holders thereof under the indenture.
We expect that the U.S. Depositary for a series of book-entry debt
securities, following the receipt of any payment of principal of or premium or
interest on the related definitive global debt securities, will immediately
credit participants' accounts with payments in amounts proportionate to their
respective beneficial interests in the principal amount of those global debt
securities as shown on the records of the U.S. Depositary. We also expect that
standing instructions and customary practices will govern the payments by
participants to owners of beneficial interests in any global debt securities
held through these participants and that these payments will be the
responsibility of these participants. These procedures are currently in practice
with securities held for the accounts of customers in bearer form or registered
in "street name".
Some jurisdictions require that some purchasers of securities take physical
delivery of these securities in definitive form. These limits and laws impair
the ability to purchase or transfer book-entry debt securities.
13
<PAGE>
SATISFACTION AND DISCHARGE; DEFEASANCE
SATISFACTION AND DISCHARGE
At our request, the indenture will terminate as to the debt securities of
any series when either:
- all of these debt securities and coupons have been delivered to the
trustee for cancellation; or
- all of these debt securities and coupons have become due and payable (or
will become due and payable at their stated maturity within one year or
are to be called for redemption within one year) and we have deposited
with the trustee in trust, money, in the currency or currencies or
currency unit or currency units in which these debt securities are
payable, in an amount sufficient to make all remaining payments on these
debt securities.
In these circumstances, however, we have obligations to register the
transfer or exchange of the debt securities and related coupons and hold moneys
for payment of these debt securities and coupons in trust. (Section 5.1)
DEFEASANCE
Unless the prospectus supplement states otherwise, if we deposit with the
trustee money, U.S. government obligations (in the case of debt securities
denominated in U.S. dollars) or foreign government obligations (in the case of
debt securities and coupons denominated in a foreign currency) that will be
sufficient to pay principal of and interest on these debt securities when due,
then we may elect one of the following two options:
- to be discharged after 91 days from all of our obligations regarding that
series of debt securities, except for obligations to register the transfer
of or exchange debt securities and related coupons, replace stolen, lost
or mutilated debt securities and coupons, maintain paying agencies and
hold moneys for payment in trust; or
- to be released from the restrictions of the covenants described under
"Certain Covenants".
To elect either option described above, we must deliver to the trustee an
opinion of counsel to the effect that the deposit and related defeasance
described above would not cause the holders of that series to recognize income,
gain or loss for U.S. federal income tax purposes and that the holders of that
series will be subject to U.S. federal income tax in the same amounts, in the
same manner and at the same times as would have been the case if that option had
not been exercised. (Section 5.3)
EVENTS OF DEFAULT, NOTICE AND WAIVER
EVENTS OF DEFAULT
An "event of default" regarding any series of debt securities is any one of
the following events:
- default for 30 days in the payment of any interest installment when due
and payable;
- default in the payment of principal or premium when due at its stated
maturity, by declaration, when called for redemption or otherwise;
- default in the making of any sinking fund payment when due;
- default in the performance of any covenant in the debt securities or in
the indenture for 90 days after notice to Polaroid by the trustee or by
holders of 25% in principal amount of the outstanding debt securities of
that series;
- certain events of bankruptcy, insolvency and reorganization of Polaroid;
and
- any other event of default of that series that is specified in the
prospectus supplement.
A default regarding a single series of debt securities will not necessarily
constitute a default regarding any other series. A default under other debt of
Polaroid will not be a default under the indenture.
14
<PAGE>
If an event for default for any series of debt securities occurs and is
continuing, either the trustee or the holders of 25% in principal amount of the
outstanding debt securities of that series (in the case of certain events of
bankruptcy, insolvency and reorganization, voting as one class with all other
outstanding debt securities) may declare the principal of all the debt
securities of that series, together with any accrued interest on the debt
securities, to be immediately due and payable by notice in writing to Polaroid.
If the holders of debt securities give notice of that declaration of
acceleration to Polaroid, then they must also give notice to the trustee.
The holders of a majority in principal amount of the outstanding debt
securities may rescind a declaration of acceleration if:
- Polaroid has paid a sum sufficient to pay principal, interest, including
overdue interest and interest thereon, any premium and the fee and
expenses of the trustee; and
- any other events of default (besides the failure to pay principal due
because of the declaration of acceleration) have been cured or waived.
(Section 6.2)
We are required to file every year with the trustee an officers' certificate
stating whether any default exists and specifying any default that exists.
(Section 11.6)
NOTICES
The trustee is required to give notice to holders of debt securities of a
default which remains uncured or has not been waived that is known to the
trustee within 90 days after the occurrence of the default. The trustee may
withhold this notice, however, if it determines in good faith that the
withholding of the notice is in the interest of the holders of the debt
securities. However, the trustee may not withhold the notice in the case of
default in the payment of principal of and premium or interest on, or a sinking
fund installment on, any of the debt securities. In addition, the trustee is
only required to give notice of the failure by Polaroid to perform any covenant
other than for payment until at least 30 days after that failure has become a
default. The term "default" for this purpose means any event which is, or after
notice or lapse of time or both would become, an event of default.
(Section 7.2)
CERTAIN RIGHTS OF THE TRUSTEE
The holders of a majority in principal amount of outstanding debt securities
of any series may direct the time, method and place of conducting any proceeding
for any remedy available to the trustee or exercising any trust or other power
conferred on the trustee. The trustee may decline to follow that direction,
however, if it either would involve the trustee in personal liability or would
be unduly prejudicial to holders of the debt securities of that series that do
not join in that direction. (Section 6.12) During a default, the trustee is
required to exercise the standard of care that a prudent man would exercise or
use under the circumstances in the conduct of his own affairs. Otherwise, the
trustee is not obligated, however, to exercise any of its rights or powers under
the indenture at the request or direction of any of the holders of debt
securities unless those holders have offered to the trustee reasonable security
or indemnity. (Section 7.3)
WAIVER
In some cases, the holders of a majority in principal amount of the
outstanding series of debt securities may, on behalf of the holders of all debt
securities of that series, waive any past default or event of default regarding
that series or compliance with some provisions of the indenture. The following
defaults may not, however, be waived:
- default in the payment of the principal of and premium or interest on any
of that series which has not been cured until that time; or
- a default regarding a covenant or provision of the indenture which cannot
be modified or amended without the consent of the holder of each
outstanding debt security of the series affected.
(Section 6.13)
15
<PAGE>
MODIFICATION OF THE INDENTURE
MODIFICATION NOT REQUIRING CONSENT OF HOLDERS
Without the consent of any holders of debt securities, we and the trustee
may modify the indenture, among other things, to:
- add to the covenants of Polaroid for the benefit of any series of debt
securities;
- add any additional events of default for any series of debt securities;
- cure any ambiguity or inconsistencies in the indenture; or
- add any other provision provided that these other provisions are not
adverse to holders of debt securities of any series in any material
respect.
(Section 10.1)
MODIFICATION REQUIRING CONSENT OF HOLDERS
With the consent of the holders of at least a majority in principal amount
of the outstanding series of the debt securities that would be affected by a
modification of the indenture, the indenture permits us and the trustee to
modify the indenture or the rights of the holders of the debt securities.
However, without the consent of each holder of all of the outstanding debt
securities affected by that modification, we may not:
- change the stated maturity date of the principal of, or any installment of
principal of or interest on, any debt security;
- reduce the principal amount of, the rate of interest on, or any premium
payable upon the redemption of, any debt security;
- reduce the principal amount of an OID debt security that would be due and
payable upon acceleration of the maturity of that security;
- change any place of payment where, or the currency or currencies or
currency unit or currency units in which, any debt security or any premium
or interest thereon is payable;
- impair the right to sue for the enforcement of any payment on or after the
stated maturity date thereof or, in the case of redemption, on or after
the redemption date;
- adversely affect the terms of conversion of any debt security into stock
or other securities of Polaroid or of any other corporation;
- reduce the percentage in principal amount of the outstanding debt
securities of any series required to consent to modify the indenture or to
consent to any waiver of compliance with the indenture;
- change Polaroid's obligation to maintain an office or agency for the
payment of outstanding debt securities; or
- modify any of the provisions listed above, the provisions for the waiver
of some covenants and defaults (except to increase the percentage of the
total principal amount of outstanding debt securities required to modify
the indenture where consent is currently required) or to modify the
provisions for modification or waiver that require the consent of each
holder of the outstanding debt securities affected.
(Section 10.2)
MEETINGS
PURPOSE AND CALLING OF MEETINGS
The indenture contains provisions for convening meetings of the holders of
debt securities of any series for any action to be made, given or taken by
holders of debt securities. (Section 14.1) The trustee, Polaroid and the holders
of at least 10% in principal amount of the outstanding debt securities of a
series may call a meeting, in each case after notice to holders of that series
has been properly given according to the requirements stated under "Notices"
below. (Section 14.2)
16
<PAGE>
QUORUM AND ACTION
Persons entitled to vote a majority in principal amount of the outstanding
debt securities of a series will constitute a quorum at a meeting of holders of
debt securities of that series. If a meeting is called by holders of debt
securities and a quorum does not exist, then the chairman of the meeting is
required to dissolve the meeting. If a meeting is called by either Polaroid or
the trustee, then the chairman of the meeting may adjourn that meeting for a
period of not less than 10 days and may further adjourn it for a period of not
less than 10 days if a quorum does not exist. (Section 14.4)
Any resolution passed or decision taken at any meeting of holders of debt
securities of any series that has been properly held in accordance with the
indenture will bind all holders of debt securities of that series and the
related coupons. (Section 14.4)
NOTICES
Except as otherwise provided in the indenture, notices to holders of bearer
debt securities, will be given by:
- publication at least once in a daily newspaper in New York City and in
London and in another city or cities as may be specified in such bearer
debt securities; and
- mail to those persons whose names and addresses were previously filed with
the trustee, within the prescribed time period.
Notices to holders of registered debt securities will be given by mail or by
overnight courier to the addresses of those holders as they appear in the
security register. (Section 1.6)
TITLE
Title to any bearer debt securities and any related coupons will pass by
delivery. Polaroid, the trustee and any of their agents may treat the bearer of
any bearer debt security or related coupon and, prior to due presentment for
registration of transfer, the registered owner of any registered debt security,
including registered debt securities in global registered form, as the absolute
owner of that security for the purpose of making payment and for all other
purposes. This will be the case whether or not that debt security or coupon
shall be overdue and notwithstanding any notice to the contrary. (Section 4.7)
REPLACEMENT OF SECURITIES AND COUPONS
MUTILATED COUPONS
We will replace any mutilated debt security and any debt security with a
mutilated coupon relating to it at the expense of the holder and on surrender of
that mutilated debt security or debt security with a mutilated coupon to the
security registrar. (Section 4.5)
DESTROYED, STOLEN OR LOST COUPONS
We will replace debt securities or coupons that are destroyed, stolen or
lost at the expense of the holder and on delivery to the security registrar of
evidence of that destruction, loss or theft which is satisfactory to us and the
security registrar. In the case of a coupon that is destroyed, stolen or lost,
that coupon will be replaced (on surrender to the security registrar of the debt
security with all other coupons not destroyed, stolen or lost) by issuance of a
new debt security in exchange for the debt security to which that coupon
relates. Before we issue a replacement debt security or coupon, we and the
security registrar may require an indemnity from the party seeking the
replacement security. (Section 4.5)
BEARER SECURITIES
If the debt security that we replace is a bearer security, we will deliver
that new debt security only outside the United States. (Section 4.5)
RESERVATION OF COMMON STOCK
Polaroid will reserve the full number of shares of common stock issuable on
conversion of the debt securities free from preemptive rights out of the total
of its authorized but unissued shares of common stock or common stock held as
treasury shares to permit the conversion of the debt securities, or preferred
stock, into shares of common stock.
17
<PAGE>
GOVERNING LAW
The laws of the State of New York govern the indenture and will govern the
debt securities and the coupons, including any matters of interpretation under
them. (Section 1.12)
INFORMATION CONCERNING THE TRUSTEE
We may from time to time maintain lines of credit, and have other customary
banking relationships, with State Street Bank and Trust Company, State Street
Bank and Trust Company, N.A., an affiliate of State Street Bank and Trust
Company, or with either of their affiliates. State Street Bank and Trust
Company, as successor to The First National Bank of Boston, also serves as the
trustee under Polaroid's indenture dated as of December 15, 1991, providing for
an unlimited amount of debt securities.
Boston EquiServe, L.P., a joint venture, of which State Street Bank and
Trust Company is an affiliate, serves as transfer agent and registrar for our
common stock.
LIMITATIONS ON ISSUANCE OF BEARER DEBT SECURITIES
Bearer debt securities are subject to the following limitations:
- Bearer debt securities may not be offered or sold during the "restricted
period" (as defined in Section 1.163-5(c)(2)(i)(D)(7) of the U.S. Treasury
Regulations) within the United States or its possessions or to U.S.
persons other than to:
-- an office located outside the United States and its possessions of a
U.S. financial institution (as defined in Section 1.165-12(c) (1)(v)
of the U.S. Treasury Regulations), that purchases for its own account
or for resale or for the account of certain customers, and provides a
certificate stating that it agrees to comply with the requirements of
Section 165(j)(3)(A), (B) or (C) of the Code and the U.S. Treasury
Regulations, or
-- certain other persons described in Section 1.163-5(c)(2)(i)(D)(1)
(iii)(B) of the U.S. Treasury Regulations.
- Bearer debt securities may not be delivered in connection with their sale
during the restricted period within the United States or its possessions.
- Any distributor (as defined in Section 1.163-5(c)(2)(i)(D)(4) of the U.S.
Treasury Regulations) participating in the offering or sale of bearer debt
securities must agree that:
-- it will not offer or sell during the restricted period any bearer debt
securities within the United States or its possessions or to United
States persons other than those described above,
-- it will not deliver in connection with the sale of bearer debt
securities during the restricted period any bearer debt securities
within the United States or its possessions; and
-- it has in effect procedures reasonably designed to ensure that its
employees and agents who are directly engaged in selling bearer debt
securities are aware of the restrictions on the offers and sales
described above.
- Bearer debt securities (other than a bearer debt security in temporary
global form) may not be delivered, nor may interest be paid on any bearer
debt securities until delivery to the trustee of the certificate signed by
either Euro-clear or Cedelbank, which is described above under "Global
Securities--Temporary Global Securities".
- Bearer debt securities will bear a legend to the following effect: "Any
United States person who holds this obligation will be subject to
limitations under the United States income tax laws, including the
limitations provided in Section 165(j) and 1287(a) of the Internal Revenue
Code".
18
<PAGE>
DESCRIPTION OF CAPITAL STOCK
The following description summarizes our capital stock. The description is
not complete, and we refer you to our Restated Certificate of Incorporation, as
amended, which we have filed with the SEC as an exhibit to the registration
statement of which this prospectus is a part.
COMMON STOCK
We have authorized 150 million shares of common stock, par value $1.00 per
share. At November 3, 1999, we had 44,524,580 shares of common stock issued and
outstanding. Our common stock is listed on the New York Stock Exchange under the
symbol "PRD".
The holders of our common stock are entitled to one vote per share on all
matters voted on by stockholders, including the election of directors, and
exclusively possess all voting power, except as otherwise:
- required by law; or
- provided in any resolution adopted by the board of directors relating to
any series of preferred stock that establishes the powers, designations,
preferences and relative, participating, option or other special rights of
the preferred stock.
Our Restarted Certificate of Incorporation does not provide for cumulative
voting in the election of directors.
Subject to the preferential rights of any outstanding series of preferred
stock, the holders of our common stock are entitled to receive:
- dividends, if declared by the board of directors from funds legally
available for dividends; and
- upon liquidation, all assets of Polaroid available for distribution to
common stock holders on a proportionate basis.
All shares of common stock issued will be fully paid and non-assessable. The
holders of our common stock will not have preemptive rights.
The transfer agent and registrar of the common stock is First National Bank
of Boston, c/o Boston EquiServe.
PREFERRED STOCK
We have authorized 20 million shares of preferred stock, par value $1.00 per
share, including one million shares of Series A Participating Cumulative
Preferred Stock (the "Series A Preferred Stock"). At December 31, 1998, no
shares of our preferred stock were issued and outstanding. The board of
directors is authorized to:
- provide for the issuance of shares of preferred stock in one or more
series;
- to establish the number of shares in each series; and
- to fix the designations, powers, preferences and rights of each series and
the qualifications, limitations or restrictions of any series.
For more information about the Series A Preferred Stock, see "--Limitations on
Changes in Control--Rights Agreement--Series A Preferred Stock". For more
information about the preferred stock offered by this prospectus, see
"Description of Offered Preferred Stock".
LIMITATIONS ON CHANGES IN CONTROL
We summarize below several agreements and provisions of our Restated
Certificate of Incorporation and by-laws and the Delaware General Corporation
Law. These provisions which we summarize below could have the effect of
delaying, deferring or preventing a change in control of Polaroid or the removal
of existing management or deterring potential acquirors from making an offer to
our stockholders. This could be the case even though a majority of our
stockholders might benefit from such a change in control or offer. In addition,
these provisions may encourage companies interested in acquiring Polaroid to
negotiate in advance with the board of directors as discussed below. These
descriptions are not complete and we refer you to these documents, which we have
filed with the SEC as exhibits to the registration statement of which this
prospectus is a part, and the Delaware General Corporation Law.
19
<PAGE>
RIGHTS AGREEMENT
Each outstanding share of common stock includes one right to purchase
1/100th of a share of our Series A Preferred Stock for a purchase price of $200
when the rights become exercisable. Until the rights become exercisable they:
- do not represent any value separate from the common stock;
- are not represented by a separate certificate;
- each common stock certificate represents both one right and one share of
common stock; and
- trade with the common stock.
The terms and other provisions of the rights are defined in a rights
agreement, dated September 9, 1986, as amended, between Polaroid and BankBoston
N.A., as successor rights agent. The rights are scheduled to expire on July 1,
2000. We filed the rights agreement with the SEC as an exhibit to our
registration statement on Form 8-A, on September 15, 1986, and we filed
amendments to it in subsequent filings with the SEC which we refer to under
"Where You Can Find More Information About Polaroid".
As long as the rights agreement is in effect, the rights that we have issued
are, and new rights that we will issue will be, attached to shares of our common
stock. As a result, whenever we issue new shares of our common stock, we will
issue one right with each of these new shares. In addition, as long as the
rights agreement is in effect, we will issue one right with each new issue share
of common stock:
- issuable upon conversion of any convertible security, including
convertible debt securities, convertible preferred stock and convertible
depositary shares;
- issuable upon the exercise of warrants to purchase common stock; and
- upon the settlement of a share purchase contract or share purchase unit.
EXERCISE OF RIGHTS. The rights are exercisable upon the earlier of:
- any person, together with all affiliates and associates, acquiring
beneficial ownership of 20% or more of our outstanding common stock (an
"Acquiring Person"), except pursuant to permitted tender offers; or
- ten days after, or on a later date if the board of directors so
determines, any person or group announces an intention to commence, or
- commences, a tender offer for 30% or more of our outstanding common stock.
The board of directors may determine in good faith that a person who has
become an Acquiring Person but was unaware that it beneficially owned 20% or
more of our outstanding common stock or acquired this amount without the
intention of effecting a change in control or influencing control of Polaroid,
will not constitute an Acquiring Person.
After the rights become exercisable, we will issue separate certificates
representing the rights and the rights will trade separately from the common
stock. Rights beneficially owned by holders of 20% or more of our outstanding
common stock are not, however, exercisable.
After the rights become exercisable, they can become valuable under various
circumstances in which the payment of the exercise price will entitle the
holders to more than a fraction of a share of Series A Preferred Stock. The
fraction is designed to be the economic equivalent of one share of common stock
at an original exercise price of $200. The circumstances in which exercise
become valuable include:
- a merger or other business combination to which we are a party; or
- the sale, lease, exchange or other transfer of 50% or more of our assets
or assets representing 50% or more of our earning power.
If one of these transactions were to occur, each right would then entitle the
holder to purchase for the exercise price:
- our common stock with a market value of two times the exercise price, if
we are the
20
<PAGE>
surviving entity in that kind of a transaction; or
- the capital stock of the acquiring entity with a market value of two times
the exercise price.
Similarly, if any person, together with all affiliates and associates:
- acquires 20% or more of our outstanding common stock, unless pursuant to
an all cash tender offer for all outstanding shares of common stock at a
price and on other terms determined by the board of directors to be fair
and adequate; or
- engages in certain "self-dealing" transactions with us,
then each right will entitle the holder to purchase for the exercise price that
number of shares, or fractions of shares, of Series A Preferred Stock equal to
the number of shares of common stock which, at the time of the transaction, will
have a market value of two times the exercise price.
REDEMPTION. We may redeem the rights at a price of $.05 per right at any
time prior to the time any party becomes an Acquiring Person. The rights may
also be redeemed by the action of our stockholders if:
- we receive a written proposal to purchase all of our outstanding voting
stock, which includes our common stock and all other classes of stock that
are entitled to vote together with our common stock as one class for the
election of directors;
- 80% of the consideration is in cash;
- the offer is accompanied by a written fairness opinion from the acquiring
party and written financing commitments; and
- a majority of our voting stock, excluding votes cast by the party
proposing to acquire the stock, votes to accept the proposal at a special
meeting of stockholders, which the board of directors is required to call.
AMENDMENT AND EXPIRATION. Prior to the rights becoming exercisable, we may
amend any provision of the rights without the prior approval of the holders of
the rights.
After the rights become exercisable, the board of directors may amend the
rights without the prior approval of the holders of rights to:
- cure any ambiguity or correct any defective provision; or
- make any other necessary or desirable changes which will not adversely
affect the interests of the holders of the rights.
The rights expire on July 1, 2000 and may be extended by the board of
directors for up to seven years. Prior to authorizing any extension, the board
of directors is required to request a vote by our stockholders as to whether to
extend the expiration date, although the outcome of that vote does not bind the
board of directors.
CERTAIN EFFECTS OF THE RIGHTS AGREEMENT. The Rights Agreement is designed to
protect our stockholders in the event of unsolicited offers to acquire Polaroid
and other coercive takeover tactics, which, in the opinion of the board of
directors, could impair its ability to represent stockholders' interests. The
rights agreement may prevent a takeover of Polaroid more difficult or make it
less likely to occur. The rights agreement may have these effects even though
the potential acquirer might be willing to pay a premium above the then
prevailing market rate for our common stock and the acquisition might be favored
by a majority of our stockholders.
SERIES A PREFERRED STOCK. If the rights become exercisable, then each right
will entitle its holder to purchase a fraction of a share of Series A Preferred
Stock that is designed to be the economic equivalent of one share of our common
stock at an exercise price of $200. This purchase price is subject to adjustment
in the event we were to:
- declare or pay a dividend on our common stock payable in shares of common
stock;
- subdivide the number of our outstanding common stock by effecting a stock
split or similar transaction; or
21
<PAGE>
- combine the outstanding shares of our common stock by a reverse stock
split or similar transaction.
Holders of Series A Preferred Stock are entitled to:
- cumulative quarterly dividends of $20 per share, even if no dividends have
been declared or paid on common stock;
- the declaration of an additional dividend prior to or at the same time
that we declare a dividend on common stock equal to the amount of
dividends payable on each share of common stock multiplied by a "formula
number", as described in the next sentence.
Initially, the formula number is 100. If we were to:
- declare or pay a dividend on our common stock payable in shares of common
stock;
- subdivide the number of outstanding shares of common stock by effecting a
stock split or similar transaction;
- combine the outstanding shares of common stock by a reverse stock split or
similar transaction; or
- issue shares of capital stock in a reclassification or change of the
outstanding shares of common stock, including in connection with a merger
in which Polaroid is the survivor,
then the formula number would be multiplied by a fraction. The numerator of the
fraction would be the number of shares of common stock outstanding after one of
the events specified above. The denominator of the fraction would be the number
of shares of common stock outstanding immediately prior to that event.
Holders of the Series A Preferred Stock will have the following voting
rights:
- Each holder will be entitled to the number of votes equal to the formula
number then in effect on all matters on which holders of common stock are
entitled to vote.
- Holders of Series A Preferred Stock and common stock will vote together as
one class for the election of directors and on all other matters submitted
to a vote of our stockholders, except as described in the next sentence.
- If, at the time of any annual meeting of stockholders for the election of
directors, six quarterly dividends, whether or not consecutive, payable on
any share of Series A Preferred Stock are in default, then the holders of
Series A Preferred Stock will be entitled to elect two directors to be
added to the board of directors.
- If the default described in the preceding sentence ceases to exist, then
holders of the Series A Preferred Stock will be divested of these special
voting rights and the directors elected pursuant to them will be
terminated.
If quarterly or other dividends to holders of the Series A Preferred Stock
are in arrears, then we will not:
- pay dividends on or redeem, purchase or otherwise acquire any shares of
stock which rank junior to the Series A Preferred Stock as to dividends or
upon liquidation, dissolution or winding up;
- pay dividends on stock which ranks equally with the Series A Preferred
Stock as to dividends or upon liquidation, dissolution or winding up,
except dividends paid proportionately on the Series A Preferred Stock and
all other equally ranking stock;
- redeem or acquire shares of any stock which ranks equally with the
Series A Preferred Stock as to dividends or upon liquidation, dissolution
or winding up, provided that we may redeem or acquire these shares in
exchange for shares of our stock that rank junior to the Series A
Preferred Stock as to dividends or upon liquidation, dissolution or
winding up;
- purchase or acquire any shares of Series A Preferred Stock, or any shares
of stock which rank equally with them, except in accordance with a
purchase made in writing or by publication to all
22
<PAGE>
holders of these shares and upon terms that the board of directors
considers, in good faith, will result in a fair and equitable treatment
among the various series or classes of stock then outstanding; or
- permit any of our subsidiaries to purchase or acquire any shares of our
stock unless we could do so.
Upon the liquidation, dissolution or winding up of Polaroid, no distribution
can be made to:
- holders of stock which rank junior to Series A Preferred Stock as to
dividends or upon liquidation, dissolution or winding up, unless holders
of the Series A Preferred Stock have received:
-- accrued and unpaid dividends to the date of this payment; plus
-- the greater of (1) $100 for each share and (2) the amount to be
distributed to each share of common stock multiplied by the formula
number then in effect for each share of Series A Preferred Stock; or
- holders of stock ranking equally with the Series A Preferred Stock as to
dividends or upon liquidation, dissolution or winding up, except
distributions made on a proportionate basis on the Series A Preferred
Stock and all other equally ranking stock.
If we enter into any consolidation, merger, combination or other transaction
in which the shares of common stock are exchanged for cash, other securities or
property, then the Series A Preferred Stock will be exchanged, at the same time,
into an amount equal to the amount exchanged for the common stock multiplied by
the formula number then in effect.
The Series A Preferred Stock will rank junior to all other series of
preferred stock, unless the board of directors determines otherwise.
POSSIBLE ANTI-TAKEOVER EFFECT OF CERTAIN PROVISIONS OF THE RESTATED
CERTIFICATE OF INCORPORATION AND BY-LAWS
Provisions of the Restated Certificate of Incorporation and our by-laws may
be deemed to have the effect of discouraging a takeover of Polaroid and may
delay, defer or prevent a tender offer or takeover attempt that a stockholder
might consider to be in that stockholder's best interest, including those
attempts that might result in his or her receiving a premium over the market
price for our common stock. We summarize these provisions below.
NO STOCKHOLDER ACTION BY WRITTEN CONSENT; SPECIAL MEETINGS. The Restated
Certificate of Incorporation prohibits stockholder action by written consent and
provides that stockholder action may only be effected at a duly called meeting.
Stockholders may only take action at an annual or special meeting called in
accordance with our by-laws. Our by-laws, however, do not permit stockholders to
call special meetings. Special meetings of stockholders may only be called by
the Chairman of the Board, the President or the board of directors. In addition,
only those matters set forth in Polaroid's notice of a special meeting may be
considered or acted upon at a special meeting of stockholders.
These provisions could have the effect of delaying consideration of a
stockholder proposal until the following annual meeting. These provisions would
also prevent the holders of a majority of the voting power of our capital stock
entitled to vote from unilaterally using the written consent procedure to take
stockholder action.
ADVANCE NOTICE FOR DIRECTOR NOMINATIONS AND STOCKHOLDER PROPOSALS. Our
by-laws require stockholders to provide advance notice of business proposed to
be brought before, and of nominations of directors to be made at, annual
meetings of stockholders. The by-laws set a date by which a stockholder must
advise Polaroid of his or her intent to seek to take action at a meeting and fix
the contents of the notice, requiring information, such as beneficial stock
ownership and other information required by the proxy rules under the Securities
Exchange
23
<PAGE>
Act of 1934. If a stockholder fails to deliver proper notice 90 days prior to
the anniversary of the immediately preceding annual meeting or in the event that
the annual meeting is more than 20 days prior to that anniversary, not later
than the 20th day following the first date on which the date of the annual
meeting was first disclosed, the proposal will be excluded from stockholder
consideration at the meeting.
ISSUANCE OF PREFERRED STOCK WITHOUT STOCKHOLDER APPROVAL. As set forth
above under "Preferred Stock", the Restated Certificate of Incorporation
authorizes the board of directors to issue, without further stockholder
approval, from time to time, preferred stock with the designations, powers,
preferences and rights that the board of directors may determine, including the
issuance of preferred stock to persons designated by the board of directors and
preferred stock with voting rights. The issuance of preferred stock, while
providing flexibility in connection with possible acquisitions and other
corporate purposes, could have the effect of making it more difficult for a
third party to acquire a majority of our outstanding common stock. In addition,
our ability to issue this kind of preferred stock may adversely effect the
marketability and potential market price of our common stock.
DELAWARE ANTI-TAKEOVER STATUTE
Polaroid is subject to Section 203 of the Delaware General Corporation Law.
In general, Section 203 prevents a person who owns 15% or more of our
outstanding voting stock (an "interested stockholder") from engaging in some
business combinations, as described below, with Polaroid for three years
following the time that that person becomes an interested stockholder unless one
of the following occurs:
- the board of directors either approves the business combination or the
transaction in which the person became an interested stockholder before
that person became an interested stockholder;
- upon completion of the transaction which resulted in the person becoming
an interested stockholder, the interested stockholder owned at least 85%
of Polaroid's voting stock outstanding at the time the transaction
commenced, excluding stock held by:
-- directors who are also officers of Polaroid; and
-- employee stock plans that do not provide employees with the right to
determine confidentially whether shares held subject to the plan will
be tendered in a tender or exchange offer; or
- at or subsequent to the time that the transaction in which the person
became an interested stockholder, the business combination is:
-- approved by the board of directors; and
-- authorized at a meeting of stockholders by the affirmative vote of the
holders of at least 66 2/3% of our outstanding voting stock which is
not owned by the interested stockholder.
For purposes of Section 203, the term "business combinations" as used above
include mergers, consolidations, asset sales or other transactions that result
in a financial benefit to the interested stockholder and transactions that would
increase the interested stockholder's proportionate share ownership of Polaroid.
Under some circumstances, Section 203 makes it more difficult for an
interested stockholder to effect various business combinations with Polaroid for
a period of three years. Although our stockholders have the right to exclude
Polaroid from the restrictions imposed by Section 203, they have not done so.
Section 203 may encourage companies interested in acquiring Polaroid to
negotiate in advance with the board of directors, since the requirement stated
above regarding stockholder approval, would be avoided if a majority of the
directors approves, prior to the time the party became an interested
stockholder, either the business combination or the transaction which results in
the stockholder becoming an interested stockholder.
24
<PAGE>
LIMITATION OF DIRECTORS' LIABILITY
The Restated Certificate of Incorporation provides that a director will not
be personally liable for monetary damages to Polaroid or our stockholders for
breach of fiduciary duty as a director, except for:
- breach of the director's duty of loyalty to Polaroid or our stockholders;
- acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law;
- paying a dividend or approving a stock repurchase that is not lawful, in
violation of Section 174 of the Delaware General Corporation Law; or
- a transaction from which the director derived an improper personal
benefit.
While the Restated Certificate of Incorporation provides directors with
protection from awards for monetary damages for breaches of their duty of care,
it does not eliminate these duties. Accordingly, the Restated Certificate of
Incorporation will have no effect on the availability of equitable remedies such
as an injunction or rescission based on a director's breach of the duty of care.
The inclusion of these provisions in the Restated Certificate of
Incorporation may have the effect of reducing the likelihood of derivative
litigation against directors. In addition, these provisions may discourage or
deter stockholders or management from bringing a lawsuit against directors for
breach of their duty of care, even though that action, if successful, might have
benefitted Polaroid and our stockholders otherwise.
INDEMNIFICATION AGREEMENTS
We have entered into indemnification agreements with our officers and
directors. The indemnification agreements require, among other things, that we:
- indemnify our officers and directors to the fullest extent permitted by
law;
- advance to the officers and directors all related expenses, subject to
reimbursement if it is determined subsequently that indemnification is not
permitted;
- indemnify and advance all expenses incurred by officers and directors
seeking to enforce their rights under the indemnification agreements; and
- provide officers and directors liability insurance.
Although the form of the indemnification agreement offers substantially the
same scope of coverage afforded by the Restated Certificate of Incorporation and
our by-laws, it provides greater assurance to directors and officers that
indemnification will be available, because, as a contract, it cannot be modified
unilaterally in the future by the board of directors or by stockholders to
eliminate the rights it provides.
RESTRICTIONS ON DIVIDENDS
Two of the agreements pursuant to which we have issued debt, and can issue
more debt in the future, restrict our ability to pay dividends. Our
$350 million Amended and Restated Credit Agreement, dated as of December 11,
1998, among Polaroid Corporation and the lenders party thereto, Morgan Guaranty
Trust Company of New York, as Administrative and Collateral Agent and
BankBoston, N.A., as Co-Agent, provides that we may not declare or pay dividends
that exceed $7.5 million, on a cumulative basis, in any fiscal quarter. The
indenture, pursuant to which we issued $275 million aggregate principal amount
of 11 1/2% Notes due 2006 on February 17, 1999 (the "11 1/2% Notes indenture")
limits our ability to make specified restricted payments, including dividends on
our capital stock, unless:
- we are not, or would not as a result of such payment be, in default under
the 11 1/2% Notes;
- we are, and based on a pro forma calculation of a fixed charge coverage
ratio set forth in the 11 1/2% Notes indenture would be, able to incur an
additional $1 of indebtedness (as defined in the 11 1/2% Notes indenture);
25
<PAGE>
- the aggregate amount of all restricted payments is less than the total of:
-- 50% of our consolidated net income (as defined in the 11 1/2% Notes
indenture) after March 28, 1999 until our most recently ended fiscal
quarter, or, if our consolidated net income for our most recently
ended fiscal quarter was a deficit, less 100% of that deficit;
-- the net cash proceeds from the sale after February 17, 1999 of our
equity securities or debt securities that are convertible into equity
securities;
-- the sale of specified investments; and
-- the value of subsidiaries if they were to become subject to the
covenants contained in the 11 1/2% Notes Indenture.
Notwithstanding the test set forth above, the 11 1/2% Notes indenture
permits us to (1) pay cash dividends on our capital stock up to $7.5 million in
any fiscal quarter and (2) make restricted payments, including dividends on our
capital stock, that do not exceed $30.0 million after February 17, 1999. We
filed the 11 1/2% Notes indenture with the SEC on a Current Report on Form 8-K
on February 17, 1999.
DESCRIPTION OF OFFERED PREFERRED STOCK
The following description summarizes some general terms that will apply to
each series of preferred stock that we issue. It is not complete, and we refer
you to the Restated Certificate of Incorporation and the form of the Certificate
of Designations Powers, Preferences and Rights for Preferred Stock, which we
have filed with the SEC as an exhibit to the registration statement of which
this prospectus is a part.
SPECIFIC TERMS OF EACH SERIES
Each time that we issue a new series of preferred stock, we will file with
the SEC a definitive certificate of designations and the prospectus supplement
relating to that new series will specify the particular amount, price and other
terms of that preferred stock. These terms will include:
- the designation of the title of the series;
- dividend rates;
- redemption provisions, if any;
- special or relative rights in the event of liquidation, dissolution,
distribution or winding up of Polaroid;
- sinking fund provisions, if any;
- whether the preferred stock will be convertible into our common stock or
other securities of Polaroid or exchangeable for securities of any other
person;
- voting rights; and
- any other preferences, privileges, powers, rights, qualifications,
limitations and restrictions, not inconsistent with the Restated
Certificate of Incorporation and by-laws.
The shares of any series of preferred stock will be, when issued, fully paid
and non-assessable. The holders of the preferred stock will not have preemptive
rights.
The prospectus supplement relating to the new series will specify whether
the series of preferred stock will be issued separately, as part of stock
purchase units or warrant units or upon exercise of warrants.
RANKING
Each new series of preferred stock will rank equally with each other series
of preferred stock and prior to our common stock regarding the distribution of
dividends or disposition of other assets, unless otherwise specified in the
applicable prospectus supplement.
DIVIDENDS
Holders of each new series of preferred stock will be entitled to receive
cash dividends, if declared by the board of directors out of funds legally
available for cash dividends. For each series, we will specify in the applicable
prospectus supplement:
- the dividend rates;
- whether the rates will be fixed or variable or both;
26
<PAGE>
- the dates of distribution of the cash dividends; and
- whether the dividends on any series of preferred stock will be cumulative
or non-cumulative.
We will pay dividends to holders of record of preferred stock as they appear
on our records, or, if applicable, the records of the depositary referred to
below under "Depositary Shares", on the record dates fixed by the board of
directors.
We cannot declare or pay full dividends on funds set apart for the payment
of dividends on any series of preferred stock unless dividends have been paid or
set apart for payment on a proportionate basis with other equity securities
which rank equally with the preferred stock regarding the distribution of
dividends. If we do not pay full dividends on all equity securities which rank
equally, then each series of preferred stock will share dividends in proportion
with our other equity securities that rank equally with that series.
CONVERSION AND EXCHANGE
The prospectus supplement for any new series of preferred stock will state
the terms and other provisions, if any, on which shares of the new series of
preferred stock are convertible into shares of our common stock or exchangeable
for securities of a third party.
REDEMPTION
We will specify in the prospectus supplement applicable to each new series
of preferred stock:
- whether it will be redeemable at any time, in whole or in part, at the
option of Polaroid or the holder of the preferred stock;
- whether it will be subject to mandatory redemption pursuant to a sinking
fund or on other terms; and
- the redemption prices.
In the event that preferred stock is partially redeemed, the shares to be
redeemed will be determined by lot, on a proportionate basis or any other method
determined to be equitable by the board of directors.
Dividends will cease to accrue on shares of preferred stock called for
redemption, and all rights of holders of redeemed shares will terminate, on and
after a redemption date, except for the right to receive the redemption price,
unless Polaroid defaults in the payment of the redemption price.
LIQUIDATION PREFERENCE
Upon the voluntary or involuntary liquidation, dissolution or winding up of
Polaroid, holders of each series of preferred stock will be entitled to receive:
- distributions upon liquidation in the amount set forth in the applicable
prospectus supplement; plus
- any accrued and unpaid dividends.
These payments will be made to holders of preferred stock out of our assets
available for distribution to stockholders before any distribution is made on
any securities ranking junior to the preferred stock regarding liquidation
rights.
In the event that holders of preferred stock are not paid in full upon a
liquidation, dissolution or winding up of Polaroid, then these holders will
share, on a proportionate basis, any future distribution of our assets with
holders of our other securities that rank equally with them.
After payment of the full amount of the liquidation preference to which they
are entitled, the holders of each series of preferred stock will not be entitled
to any further participation in any distribution of assets of Polaroid.
VOTING RIGHTS
The holders of shares of preferred stock will have no voting rights except
as indicated in the certificate of designations relating to the series, the
applicable prospectus supplement or as required by applicable law.
TRANSFER AGENT AND REGISTRAR
We will specify each of the transfer agent, registrar, dividend disbursing
agent and redemption agent for shares of each new series of preferred stock in
the applicable prospectus supplement.
27
<PAGE>
RESERVATION OF COMMON STOCK
Polaroid will reserve the full number of shares of common stock issuable on
conversion of the preferred stock from preemptive rights out of the total of its
authorized but unissued shares of common stock or common stock held as treasury
shares to permit the conversion of the debt securities, or preferred stock, into
shares of common stock.
DEPOSITARY SHARES
We may, at our option, elect to offer fractional, rather than whole, shares
of preferred stock. In that event, we will issue to the public receipts for
depositary shares, each of which will represent a fraction of a share of
preferred stock. If we issue depositary shares, we will specify the terms and
other provisions of that series in a prospectus supplement and whether the
series will be issued separately, as part of stock purchase units or warrant
units or upon exercise of warrants.
The depositary shares will be deposited with a depositary under a deposit
agreement to be entered between Polaroid and that depositary. The depositary
will be a bank or trust company selected by us and is required to have its
principal office in the United States and have a combined capital and surplus of
a least $50 million. The depositary shares will be evidenced by depositary
receipts issued pursuant to the deposit agreement. Depositary receipts will be
distributed to those persons purchasing the depositary shares.
The following description of the depositary shares is not complete, and we
refer you to the forms of deposit agreement and the depositary receipt which we
have filed with the SEC as exhibits to the registration statement of which this
prospectus is a part.
RIGHTS AND PREFERENCES
Each owner of a depositary share will be entitled to all the rights and
preferences of the preferred stock, in proportion to the applicable fraction of
the share of preferred stock represented by the depositary share, including:
- dividend rights;
- redemption rights, if any;
- voting rights;
- conversion or exchange rights, if any; and
- liquidation rights.
DIVIDENDS AND OTHER DISTRIBUTIONS
The depositary will distribute all cash dividends and other cash
distributions received on the preferred stock to the record holders of
depositary shares in proportion to the number of depositary shares that they
hold.
In the event of a distribution other than in cash, the depositary will
distribute property received by it to the record holders of depositary shares
entitled to receive the property, unless the depositary determines that it is
not feasible to make the distribution. If the depositary determines that it is
not feasible to make the distribution, then the depositary may, with our
approval, sell the property and distribute the net proceeds of the sale to the
holders of the depositary shares.
REDEMPTION OF DEPOSITARY SHARES
If a series of preferred stock represented by depositary shares is subject
to redemption, the depositary shares will be redeemed from the proceeds received
by the depositary resulting from the redemption, in whole or in part, of
preferred stock held by the depositary. The redemption price for each depositary
share will be equal to the applicable fraction of the redemption price for each
share payable on the series of the preferred stock.
If we redeem shares of preferred stock held by the depositary, the
depositary will redeem, as of the same redemption date, the number of depositary
shares representing the shares of preferred stock so redeemed. If fewer than all
the depositary shares are to be redeemed, the depositary will select by lot or
on a proportionate basis the depositary shares to be redeemed.
CONVERSION AND EXCHANGE
If a series of preferred stock represented by depository shares is
convertible into our common stock or exchangeable for securities of a third
party, each depository share will be convertible into or exchangeable for that
number of shares of our common stock or third party securities
28
<PAGE>
equal to the applicable fraction of the conversion or exchange ratio applicable
to one share of preferred stock.
VOTING THE PREFERRED STOCK
Each holder of depositary shares on the record date will be entitled to
instruct the depositary as to the exercise of the voting rights pertaining to
the amount of the preferred stock represented by that holder's depositary
shares. The record date will be the same date as the record date for the
preferred stock.
When the depositary receives notice of any meeting at which the holders of
any series of preferred stock are entitled to vote, the depositary will:
- mail the information contained in the notice of meeting to the record
holders of the depositary shares;
- endeavor, insofar as practicable, to vote the amount of the preferred
stock represented by the depositary shares in accordance with the voting
instructions of the record holders of the depositary shares; and
- abstain from voting shares of the preferred stock to the extent it does
not receive specific instructions from the holders of depositary shares.
Polaroid will agree to take all action which may be deemed necessary by the
depositary in order to enable the depositary to vote the depositary shares as
instructed.
TEMPORARY AND DEFINITIVE DEPOSITARY RECEIPTS
Pending the preparation of definitive depositary receipts, the depositary
may issue temporary depositary receipts substantially identical to the
definitive depositary receipts. Temporary depositary receipts will carry the
same rights as definitive depositary receipts.
If temporary depositary receipts are issued, we will prepare definitive
depositary receipts without unreasonable delay. Temporary depositary receipts
will be exchangeable for definitive depositary receipts at our expense. In
addition, subject to the terms of the deposit agreement, holders of depositary
shares will be entitled to withdraw and receive, upon surrender of depositary
receipts, certificates evidencing the fractional number of shares of preferred
stock represented by the depositary receipts.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The depositary receipts evidencing the depositary shares and any provision
of the deposit agreement may be amended by agreement between Polaroid and the
depositary at any time. However, any amendment that materially and adversely
alters the rights of the holders of depositary shares will not be effective,
unless the amendment has been approved by the holders of at least a majority of
the depositary shares then outstanding.
The deposit agreement may be terminated by Polaroid or the depositary only
if:
- all outstanding depositary shares have been redeemed; or
- there has been a final distribution in respect of the preferred stock in
connection with any liquidation, dissolution or winding up of Polaroid and
the distribution has been distributed to the holders of depositary
receipts.
TAXES AND COSTS
We will pay:
- all transfer and other taxes and governmental charges arising solely from
the existence of the depositary arrangements; and
- charges of the depositary in connection with the initial deposit of the
preferred stock and any redemption of preferred stock.
Holders of depositary receipts will pay:
- transfer and other taxes and governmental charges other than those
described in the preceding sentence; and
- other charges, including a fee for the withdrawal of shares of preferred
stock upon surrender of depositary receipts, as provided in the deposit
agreement to be for their accounts.
29
<PAGE>
DELIVERY OBLIGATIONS
The depositary will forward to holders of depositary receipts all reports
and communications from Polaroid that are delivered to the depositary and which
we are required to furnish to the holders of the preferred stock.
LIMITATION OF LIABILITY
Neither we nor the depositary will be liable if we or it is prevented or
delayed by law or any circumstance beyond our or its control in performing our
or its obligations under the deposit agreement. Our and the depositary's
obligations under the deposit agreement will be limited to the performance, in
good faith, of our and its duties under it. We and the depositary will not be
obligated to prosecute or defend any legal proceeding regarding the depositary
shares or the preferred stock unless we or they are furnished a satisfactory
indemnity. We and the depositary may rely upon the written advice of counsel or
accountants and information provided by persons presenting preferred stock for
deposit and holders of depositary receipts.
RESIGNATION AND REMOVAL OF DEPOSITARY
The depositary may resign at any time by delivering to us notice of its
election to do so. In addition, at any time, we may remove the depositary
subject to the appointment of an acceptable successor. The resignation or effect
upon the appointment of a successor depositary and its acceptance of the
appointment. The successor depositary must be appointed within 60 days after
delivery of the notice of resignation or removal and must be a bank or trust
company having its principal office in the United States and having a combined
capital and surplus of at least $50 million.
DESCRIPTION OF STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS
We may issue share purchase contracts, including contracts obliging holders
to purchase from Polaroid, and Polaroid to sell to the holders, a specified
number of shares of common stock at a future date or dates. The consideration
per share of common stock may be fixed at the time the stock purchase contracts
are issued or may be determined by reference to a specific formula described in
the stock purchase contracts. We may issue the stock purchase contracts
separately or as a part of stock purchase units consisting of:
- a stock purchase contract; and
- any of a debt security of Polaroid, a share of preferred stock of Polaroid
or a depositary share relating to preferred stock of Polaroid or a debt
obligation of a third party, including a U.S. Treasury security.
The debt security, share of preferred stock or depositary share relating to
preferred stock of Polaroid or debt obligation of a third party may serve as
collateral to secure the holders' obligations to purchase the common stock under
the stock purchase contracts. The stock purchase contracts may require us to
make periodic payments to the holders of stock purchase contracts. These
payments may be unsecured or prefunded on some basis to be specified. The stock
purchase contracts may require holders of Polaroid to secure their obligations
in a specified manner. The applicable prospectus supplement will describe the
specific terms and other provisions of any stock purchase contracts or stock
purchase units.
DESCRIPTION OF WARRANTS AND WARRANT UNITS
We may issue warrants, including debt warrants, which are warrants to
purchase debt securities, and equity warrants, which are warrants to purchase
common stock, preferred stock or depositary shares. We may issue warrants
independently of or together with any other securities, including as part of a
warrant unit, and warrants may be attached to or separate from those securities.
Each series of warrants will be issued under a separate warrant agreement to
be entered into between Polaroid and a warrant agent. The warrant agent will act
solely as our agent in connection with a series of warrants and will not
30
<PAGE>
assume any obligation or relationship of agency for or with holders or
beneficial owners of warrants. The following describes the general terms and
provisions of the warrants offered by this prospectus. The applicable prospectus
supplement will describe any other terms of the warrant and the applicable
warrant agreement.
Each warrant unit will consist of:
- a warrant under which the holder will, upon exercise, purchase a specified
number of shares of common stock; and
- any of a debt security of Polaroid, a share of preferred stock of Polaroid
or a depositary share relating to preferred stock of Polaroid.
DEBT WARRANTS
The applicable prospectus supplement will describe the terms of any debt
warrants, including the following:
- the title and aggregate number of the debt warrants;
- any offering price of the debt warrants;
- whether the debt warrants are to be issued with any debt securities, and,
if so, the title, total principal amount and terms;
- the number of debt warrants and debt securities that will be separately
transferable;
- any date on and after the debt warrants and debt securities will be
separately transferable;
- the title, total principal amount, ranking and terms, including
subordination and conversion provisions, of the underlying debt securities
that may be purchased upon exercise of the debt warrants;
- the time or period when the debt warrants are exercisable, the minimum or
maximum amount of debt warrants which may be exercised at any one time,
and the final date on which the debt warrants may be exercised;
- the principal amount of underlying debt securities that may be purchased
upon exercise of each debt warrant and the price, or the manner of
determining the price, at which the principal amount may be purchased upon
exercise;
- the terms of any right to redeem or call the debt warrants;
- any book-entry procedure information;
- any currency or currency units in which the offering price and the
exercise price are payable;
- any other terms of the debt warrants not inconsistent with the provisions
of the debt warrant agreement.
EQUITY WARRANTS
The applicable prospectus supplement will describe the terms of any equity
warrants, including the following:
- the title and aggregate number of the equity warrants;
- any offering price of the equity warrants;
- the designation and terms of any preferred shares that are purchasable
upon exercise of the equity warrants or that underlie depositary shares
purchasable upon this exercise;
- if applicable, the designation and terms of the securities with which the
equity warrants are issued and the number of the equity warrants issued
with each security;
- if applicable, the date from and after the equity warrants and any
securities issued with them will be separately transferrable;
- the number of shares of common stock, preferred stock or depositary shares
purchasable upon exercise of an equity warrant and the price;
- the time or period when the equity warrants are exercisable and the final
date on which the equity warrants may be exercised and terms regarding any
right of Polaroid to accelerate this final date;
- if applicable, the minimum or maximum amount of the equity warrants
exercisable at any one time;
- any currency or currency units in which the offering price and the
exercise price are payable;
31
<PAGE>
- any applicable anti-dilution provisions of the equity warrants;
- any applicable redemption or call provisions; and
- any additional terms of the equity warrants not inconsistent with the
provisions of the equity warrant agreement.
WARRANT UNITS
The applicable prospectus supplement will describe the specific terms and
other provisions of any warrant units.
PLAN OF DISTRIBUTION
We may sell the debt securities, the preferred stock and the depositary
shares in any of three ways:
- through underwriters;
- through agents; or
- directly to a limited number of institutional purchasers or to a single
purchaser.
The prospectus supplement for each series of securities we sell will
describe that offering, including:
- the name or names of any underwriters;
- the purchase price and the proceeds to us from that sale;
- any underwriting discounts and other items constituting underwriters'
compensation;
- any initial public offering price and any discounts or concessions allowed
or reallowed or paid to dealers; and
- any securities exchanges on which the securities may be listed.
UNDERWRITERS
If underwriters are used in the sale, we will execute an underwriting
agreement with those underwriters relating to the securities that we will offer.
Unless otherwise set forth in the prospectus supplement, the obligations of the
underwriters to purchase these securities will be subject to conditions. The
underwriters will be obligated to purchase all of these securities if any are
purchased.
The securities subject to the underwriting agreement will be acquired by the
underwriters for their own account and may be resold by them from time to time
in one or more transactions, including negotiated transactions, at a fixed
public offering price or at varying prices determined at the time of sale.
Underwriters may be deemed to have received compensation from us in the form of
underwriting discounts or commissions and may also receive commissions from the
purchasers of these securities for whom they may act as agent. Underwriters may
sell these securities to or through dealers. These dealers may receive
compensation in the form of discounts, concessions or commissions from the
underwriters and/or commissions from the purchasers for whom they may act as
agent. Any initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers may be changed from time to time.
We also may sell the securities in connection with a remarketing upon their
purchase, in connection with a redemption or repayment, by a remarketing firm
acting as principal for its own account or as our agent. Remarketing firms may
be deemed to be underwriters in connection with the securities that they
remarket.
We may authorize underwriters to solicit offers by institutions to purchase
the securities subject to the underwriting agreement from us at the public
offering price stated in the prospectus supplement pursuant to delayed delivery
contracts providing for payment and delivery on a specified date in the future.
If we sell securities pursuant to these delayed delivery contracts, the
prospectus supplement will state that as well as the conditions to which these
delayed delivery contracts will be subject and the commissions payable for that
solicitation.
AGENTS
We may also sell any of the securities through agents designated by us from
time to time. We will name any agent involved in the offer or sale of these
securities and will list commissions payable by us to these agents in the
32
<PAGE>
prospectus supplement. These agents will be acting on a best efforts basis to
solicit purchases for the period of its appointment, unless we state otherwise
in the prospectus supplement.
DIRECT SALES
We may sell any of the securities directly to purchasers. In this case, we
will not engage underwriters or agents in the offer and sale of these
securities.
INDEMNIFICATION
We may indemnify underwriters, dealers or agents who participate in the
distribution of securities against certain liabilities, including
liabilities under the Securities Act of 1933 and agree to contribute to payments
which these underwriters, dealers or agents may be required to make.
NO ASSURANCE OF LIQUIDITY
Each series of securities will be a new issue of securities with no
established trading market. Any underwriters that purchase securities from us
may make a market in these securities. The underwriters will not be obligated,
however, to make such a market and may discontinue market-making at any time
without notice to holders of the securities. We cannot assure you that there
will be liquidity in the trading market for any securities of any series.
EXPERTS
The consolidated financial statements and schedules of Polaroid and
subsidiary companies as of December 31, 1997 and 1998, and for each of the years
in the three-year period ended December 31, 1998, have been incorporated by
reference in this prospectus and in the registration statement of which this
prospectus is a part in reliance upon the report of KPMG LLP, independent
certified public accountants, incorporated by reference herein, and upon the
authority of that firm as experts of accounting and auditing.
The report of KPMG LLP covering the December 31, 1997, consolidated
financial statements refers to a change in the method of accounting for
depreciation.
With respect to the unaudited interim financial information for the periods
ended March 28, 1999, June 27, 1999 and September 26, 1999, incorporated by
reference herein, the independent certified public accountants have reported
that they applied limited procedures in accordance with professional standards
for a review of such information. However, their separate reports included in
our quarterly reports on Form 10-Q for the quarters ended March 28,1999,
June 27, 1999 and September 26, 1999, and incorporated by reference herein,
state that they did not audit and they do not express an opinion on that interim
financial information. Accordingly, the degree of reliance on their reports on
such information should be restricted in light of the limited nature of the
review procedures applied. The accountants are not subject to the liability
provisions of Section 11 of the Securities Act of 1933 for their report on the
unaudited financial information because their report is not a "report" or a
"part" of the registration statement prepared or certified by accountants within
the meaning of Sections 7 and 11 of such Act.
LEGAL OPINIONS
Simpson Thacher & Bartlett, New York, New York, has issued an opinion
regarding the legality of each of the Securities. Neal D. Goldman, Esq., who is
the Vice President, General Counsel and Secretary of Polaroid, may issue an
opinion regarding certain other matters for us. Any underwriters, dealers or
agents may be advised about other issues relating to any offering by their own
legal counsel.
33
<PAGE>
PART II INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The following is an itemization of all fees and expenses incurred or
expected to be incurred by the Registrant in connection with the issuance and
distribution of the securities being registered hereby, other than underwriting
discounts and commissions. All but the Securities and Exchange Commission
registration fee are estimates and remain subject to future contingencies.
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee......... $ 72,600*
Legal fees and expenses..................................... 250,000
Accounting fees and expenses................................ 10,000
Trustee's fees and expenses................................. 15,000
Printing and engraving fees................................. 100,000
Rating Agency Fees.......................................... 350,000
Blue Sky fees and expenses.................................. 20,000
Miscellaneous expenses...................................... 32,400
--------
Total................................................... $850,000
========
</TABLE>
* In addition, the Registrant has previously paid a registration fee of
$62,550 in connection with the filing of an aggregate principal amount of
$225,000,000 of debt securities that remain eligible to be sold under the Prior
Registration Statement and that are being carried forward to the prospectus
included herein pursuant to Rule 429 under the Securities Act.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
As permitted by Section 102(b)(7) of the Delaware General Corporation Law,
the Registrant's Restated Certificate of Incorporation eliminates a director's
personal liability for monetary damages to the Registrant and its stockholders
arising from a breach of a director's fiduciary duty, except (1) for liability
with respect to an illegal dividend or stock repurchase or (2) liability for a
breach of the director's duty of loyalty to the Registrant or its stockholders,
(3) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law or (4) for any transaction in which the
director derived an improper personal benefit. The effect of this provision in
the Restated Certificate of Incorporation is to eliminate the rights of the
Registrant and its stockholders (through stockholders' derivative suits on
behalf of the Registrant) to recover monetary damages against a director for
breach of fiduciary duty as a director (including breaches resulting from
negligent or grossly negligent behavior) except in the situations described
above.
Section 145 of the Delaware General Corporation Law provides for
indemnification by the Registrant of its directors and officers and certain
other persons.
The Registrant's By-Laws provide that, to the extent not inconsistent with
Delaware or other applicable law in effect from time to time, the Registrant
shall indemnify any person who was or is a party or is threatened to be made a
party to any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative (other than an action
by or in the right of the Registrant) by reason of the fact that he is or was a
director, officer, employee or agent of the Registrant or is or was serving at
the request of the Registrant as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorney's fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interests of the
Registrant, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.
II-1
<PAGE>
The Registrant's By-Laws also provide that, to the extent not inconsistent
with Delaware or other applicable law in effect from time to time, the
Registrant shall indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action or suit by or in
the right of the Registrant to procure a judgment in its favor by reason of the
fact that such person acted in any of the capacities set forth above, against
expenses (including attorney's fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in
good faith and in a manner he reasonably believed to be in, or not opposed to,
the best interests of the Registrant, except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall have
been adjudged to be liable to the Registrant unless and only to the extent that
the Court of Chancery or the court in which such action or suit was brought
shall determine that despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the court shall deem proper.
Generally, a director will be entitled to be indemnified against a claim if
a majority of a quorum of the directors who are not parties to the relevant
legal proceedings, independent legal counsel or the stockholders determine that
the director acted under the relevant standard of conduct set forth in the two
preceding paragraphs.
The Registrant's By-Laws further provide that to the extent that a director,
officer, employee or agent of the Registrant has been successful on the merits
or otherwise in defense of any action, suit or proceeding referred to above or
in defense of any claim, issue or matter therein, he shall be indemnified
against expenses (including attorneys' fees) actually and reasonably incurred by
him in connection therewith; that the indemnification provided for by the
By-Laws shall not be deemed exclusive of any other rights to which the
indemnified party may be entitled; and that the Registrant is empowered to
purchase and maintain insurance on behalf of a person who is or was acting in
any of the capacities set forth above against any liability asserted against him
and incurred by him in any such capacity, or arising out of his status as such,
whether or not the Registrant would have the power to indemnify him against such
liabilities under the By-Laws.
The Registrant maintains policies of insurance under which directors,
officers and certain employees of the Registrant and its subsidiaries are
insured, subject to certain specific exclusions and deductible maximum amounts,
against loss arising from any civil claim which may be made against them, or any
of them, arising out of any misstatement, misleading statement, omission or
other act done or alleged to have been done, or wrongfully attempted, while
acting in their representative capacities.
Any agreement with underwriters or agents may contain provisions providing
for the indemnified of the Registrant and certain of its directors and officers
in certain circumstances.
ITEM 16. EXHIBITS
The following exhibits are filed as part of this registration statement:
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<C> <S>
1.1* Form of Underwriting Agreement for [Convertible]
[Senior][Subordinated] Debt Securities.
1.2* Form of Underwriting Agreement for Common Stock.
1.3* Form of Underwriting Agreement for [Convertible] Preferred
Stock.
1.4* Form of Underwriting Agreement for Depositary Shares.
</TABLE>
II-2
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<C> <S>
3.1** Restated Certificate of Incorporation. (The Restated
Certificate of Incorporation, included as Exhibit 3.2(a) to
Polaroid Corporation's Annual Report Form 10-K for the year
ended December 31, 1988, is hereby incorporated herein by
reference.)
3.2** Amendment to the Restated Certificate of Incorporation as of
May 12, 1987. (The Amendment to the Restated Certificate of
Incorporation, included as Exhibit 3.1 to Polaroid
Corporation's Quarterly Report on Form 10-Q for the
quarterly period ended June 28, 1987, is hereby incorporated
herein by reference.)
3.3** Amendment to the Restated Certificate of Incorporation as of
June 2, 1989. (The Amendment to the Restated Certificate of
Incorporation, included as Exhibit 3.1 to Polaroid
Corporation's Quarterly Report on Form 10-Q for the
quarterly period ended July 2, 1989, is hereby incorporated
herein by reference.)
3.5** By-laws of Polaroid Corporation. (The By-laws, included as
Exhibit 3.1 to Polaroid Corporation's Annual Report on Form
10-K for the year ended December 31, 1993, are hereby
incorporated herein by reference.)
3.6** Amendment to the Restated Certificate of Incorporation as of
May 14, 1985 (the Amendment to the Restated Certificate of
Incorporation, included as Exhibit 3 to Polaroid
Corporation's Quarterly Report on Form 10-Q for the
quarterly period ended March 28, 1999, is hereby
incorporated herein by reference.)
4.1** Rights Agreement, dated as of September 9, 1986, between
Polaroid Corporation and Morgan Shareholder Services Trust
Company, as Rights Agent. (The Rights Agreement, included as
Exhibit 1 to Polaroid Corporation' Registration Statement on
Form 8-A as filed on September 15, 1986, is hereby
incorporated herein by reference.)
4.2** First Amendment, dated as of August 16, 1988, to Rights
Agreement, dated as of September 9, 1986, between Polaroid
Corporation and Morgan Shareholder Services Trust Company,
as Rights Agent. (The First Amendment, included as Exhibit 4
to Polaroid Corporation's Registration Statement on Form 8-A
(Amendment No. 1 to Polaroid Corporation's Registration
Statement on Form 8-A filed on September 15, 1986) as filed
on August 18, 1988, is hereby incorporated herein by
reference.)
4.3** Second Amendment, dated as of September 14, 1988, to Rights
Agreement, dated as of September 9, 1986, between Polaroid
Corporation and Morgan Shareholder Services Trust Company,
as Rights Agent. (The Second Amendment, included as Exhibit
5 to Polaroid Corporation's Registration Statement on Form
8-A (Amendment No. 2 to Polaroid Corporation's Registration
Statement on Form 8-A filed on September 15, 1988), filed on
September 15, 1986, is hereby incorporated herein by
reference.)
4.4** Supplemental Rights Agreement and Third Amendment, dated as
of January 30, 1989, to Rights Agreement, dated as of
September 9, 1986, between Polaroid Corporation and Morgan
Shareholder Services Trust Company, as Rights Agent. (The
Supplemental Rights Agreement and Third Amendment, included
as Exhibit 6 to Polaroid Corporation's Registration
Statement on Form 8-A (Amendment No. 3 to Polaroid
Corporation's Registration Statement on Form 8-A filed on
September 15, 1986) filed on January 30, 1989, is hereby
incorporated herein by reference.)
</TABLE>
II-3
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<C> <S>
4.5** Fourth Amendment, dated as of February 21, 1989, to the
Rights Agreement, dated as of September 9, 1986, between
Polaroid Corporation and Morgan Shareholder Services Trust
Company, as Rights Agent. (The Fourth Amendment, included as
Exhibit 7 to Polaroid Corporation's Registration Statement
on Form 8-A (Amendment No. 4 to Polaroid Corporation's
Registration Statement on Form 8-A filed on September 15,
1986) filed on February 21, 1989, is hereby incorporated
herein by reference.)
4.6** Supplemental Rights Agreement and Fifth Amendment, dated as
of October 7, 1991, to the Rights Agreement, dated as of
September 9, 1986, between Polaroid Corporation and First
Chicago Trust Company (as successor to Morgan Shareholder
Services Trust Company), as Rights Agent. (The Supplemental
Rights Agreement and Fifth Amendment, included as Exhibit 8
to Polaroid Corporation's Registration Statement on Form 8-A
(Amendment No. 5 to Polaroid Corporation's Registration
Statement on Form 8-A filed on September 15, 1986) filed on
October 21, 1991, is hereby incorporated herein by
reference.)
4.7** Sixth Amendment (previously designated as the Fifth
Amendment), dated as of March 23, 1993, to the Rights
Agreement, dated as of September 9, 1986, between Polaroid
Corporation and First Chicago Trust Company, as Rights
Agent. (The Sixth Amendment (previously designated as the
Fifth Amendment), included as Exhibit 9 (previously
designated as Exhibit 8) to Polaroid Corporation's
Registration Statement on Form 8-A (Amendment No. 6
(previously designated as Amendment No. 5) to Polaroid
Corporation's Registration Statement on Form 8-A filed on
September 15, 1986) filed on July 2, 1993, is hereby
incorporated herein by reference.)
4.8** Amendment, dated as of June 30, 1993, to the Fifth
Amendment, dated as of March 23, 1993, to the Rights
Agreement, dated as of September 9, 1986, between Polaroid
Corporation and First Chicago Trust Company, as Rights
Agent. (The Amendment to the Sixth Amendment, included as
Exhibit 10 to Polaroid Corporation's Registration Statement
on Form 8-A (Supplement to Amendment No. 5 and redesignation
thereof as Amendment No. 6 to Polaroid Corporation's
Registration Statement on Form 8-A filed on September 15,
1986) filed on July 2, 1993, is hereby incorporated herein
by reference.)
4.9** Seventh Amendment, dated as of July 13, 1998, to the Rights
Agreement, dated as of September 9, 1986, between Polaroid
Corporation and BankBoston, N.A. (as successor to First
Chicago Trust Company), as Rights Agent. (The Seventh
Amendment, included as Exhibit 11 to Polaroid Corporation's
Registration Statement on Form 8-A/A (Amendment No.7 to the
Form 8-A filed on September 15, 1986) filed on July 13,
1998, is hereby incorporated herein by reference.)
4.10** Indenture, dated as of January 9, 1997, by and between
Polaroid Corporation and State Street Bank and Trust
Company, as Trustee. (The Indenture, included as Exhibit 4
to Polaroid Corporation's Quarterly Report on Form 10-Q for
the quarterly period ended March 30, 1997, is hereby
incorporated herein by reference.)
4.11** First Supplemental Indenture, dated as of February 17, 1999,
by and between Polaroid Corporation and State Street Bank
and Trust Company, as Trustee (The First Supplemental
indenture included as Exhibit 4.2 to Polaroid Corporation's
Current Report on Form 8-K filed on February 17, 1999, is
hereby incorporated herein by reference.)
4.12* Form of Second Supplemental Indenture by and between
Polaroid Corporation and State Street Bank and Trust
Company, as Trustee.
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<C> <S>
4.13* Form of Fixed Rate Security with or without Optional
Redemption Provision for Convertible or Non-Convertible
Senior or Subordinated Debt Security. (The Form of Debt
Security, included as Exhibit A in Exhibit 4.11 hereto, is
hereby incorporated herein by reference.)
4.14** Certificate of Designations, Powers Preferences and Rights
of Series A Participating Cumulative Preferred Stock. (The
Certificate of Designations, filed as Exhibit 4.1 to
Polaroid Corporation's Quarterly Report on Form 10-Q for the
quarterly period ended September 27, 1987, is hereby
incorporated herein by reference.)
4.15* Form of Certificate of Designations Powers, Preferences and
Rights for Preferred Stock.
4.16* Form of Deposit Agreement.
4.17* Form of Depositary Receipt. (The Form of Depositary Receipt,
included as Exhibit A to Exhibit 4.16 hereto, is hereby
included herein by reference.)
4.18* Form of Common Stock Certificate.
4.19** Form of Rights Certificate. (The Form of Rights Certificate,
included as Exhibit B to Exhibit 4.1, is hereby incorporated
herein by reference.)
4.20* Form of Preferred Stock Certificate.
4.21* Form of Stock Purchase Agreement.
4.22* Form of [Senior] [Subordinated] Debt Warrant Agreement.
4.23* Form of Stock Warrant Agreement.
5* Opinion of Simpson Thacher & Bartlett as to the legality of
the Debt Securities, the Preferred Stock, the Depositary
Shares, the Common Stock, the Rights, the Stock Purchase
Contracts, the Stock Purchase Units, the Warrants and the
Warrant Units.
10.1** $350,000,000 Amended and Restated Credit Agreement dated as
of December 11, 1998 (the "Amended and Restated Credit
Agreement") among Polaroid Corporation, Morgan Guaranty
Trust Company of New York, as Agent, and the Banks listed
therein. (The Amended and Restated Credit Agreement,
included as Exhibit 10.1 to Polaroid Corporation's Current
Report on Form 8-K filed on January 21, 1999 is hereby
incorporated herein by reference.)
10.2** Amendment Number 1 dated as of March 31, 1999 to the Amended
and Restated Credit Agreement. (Amendment Number 1, included
as Exhibit 10 to Polaroid Corporation's Quarterly Report on
Form 10-Q for the quarterly period ended March 28, 1999, is
hereby incorporated herein by reference.)
10.3** Amendment Number 2 dated as of September 10, 1999 to the
Amended and Restated Credit Agreement. (Amendment Number 1,
included as Exhibit 10.1 to Polaroid Corporation's Quarterly
Report on Form 10-Q for the quarterly period ended
September 26, 1999, is hereby incorporated herein by
reference.)
12.1** Statement of Computation of Ratio of Earnings To Fixed
Charges. (The Statement, included as Exhibit 12 to Polaroid
Corporation's Quarterly Report on Form 10-Q for the
quarterly period ended September 26, 1999, is hereby
incorporated herein by reference.)
15.1* Letter regarding unaudited interim financial information
regarding the Forms 10-Q for the Quarterly Periods Ended
March 28, 1999, June 27, 1999 and September 26, 1999.
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
- ----------- -----------
<C> <S>
23.1* Consent of KPMG LLP.
23.2* Consent of Simpson Thacher & Bartlett. (The Consent is
included in Exhibit 5.)
24* Powers of Attorney. (The Powers of Attorney are included on
page II-7 of this Registration Statement.)
</TABLE>
- ------------------------
* Filed herewith.
** Incorporated herein by reference as stated in the description of the
exhibit.
In addition, the Registrant hereby agrees to furnish to the Commission, upon
request, copies of certain debt instruments defining the rights of holders of
long-term debt of the kind described in, and pursuant to, Item
601(b)(4)(iii) of Regulation S-K of the Commission
ITEM 17. 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 the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the Registration Statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which
was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more that
a 20 percent change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
Registration Statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement
or any material change to such information in the 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.
(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 hereby 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, (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section (d) of the Exchange Act) that is incorporated by reference
in the Registration Statement 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.
II-6
<PAGE>
(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 a registrant of expenses incurred or paid
by a director, officer or controlling person of such 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.
[THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
II-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Cambridge, the Commonwealth of Massachusetts, on
January 31, 2000.
<TABLE>
<S> <C> <C>
POLAROID CORPORATION
By: /s/ GARY T. DICAMILLO
-----------------------------------------
Name: Gary T. DiCamillo
Title: Chairman of the Board
And Chief Executive Officer
</TABLE>
POWERS OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints Gary T. DiCamillo, Judith G. Boynton, Neal
D. Goldman and Ralph M. Norwood, severally, his true and lawful
attorneys-in-fact and agents, with full power of substitution and
resubstitution, for him and in his name, place and stead, and in any and all
capacities, to sign this Registration Statement and any and all amendments to
this Registration Statement of the Registrant, together with all schedules and
exhibits thereto, and to file the same with all scheduled exhibits thereto and
other documents in connection therewith with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, severally, full
power and authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents and
purposes as each such person might or could do in person, hereby ratifying and
confirming all that said attorneys-in-fact and agents, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof, all on
January 31, 2000.
[THE REST OF THIS PAGE IS LEFT INTENTIONALLY BLANK. THE SIGNATURE PAGE FOLLOWS.]
II-8
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities indicated and on January 31, 2000.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<C> <S> <C>
/s/ GARY T. DICAMILLO Chairman of the Board
------------------------------------------- and Chief Executive Officer
Gary T. DiCamillo (Chief Executive Officer)
/s/ JUDITH G. BOYNTON Executive Vice President
------------------------------------------- and Chief Financial Officer
Judith G. Boynton (Principal Financial Officer)
/s/ CARL L. LUEDERS
------------------------------------------- Vice President and Controller
Carl L. Lueders (Controller)
/s/ STEPHEN A. BEMAZZANI
------------------------------------------- Director
Stephen A. Bemazzani
/s/ RALPH E. GOMORY
------------------------------------------- Director
Ralph E. Gomory
/s/ STEPHEN P. KAUFMAN
------------------------------------------- Director
Stephen P. Kaufman
/s/ JOHN W. LOOSE
------------------------------------------- Director
John W. Loose
/s/ ALBIN F. MOSCHNER
------------------------------------------- Director
Albin F. Moschner
/s/ ALFRED POE
------------------------------------------- Director
Alfred Poe
/s/ RALPH Z. SORENSON
------------------------------------------- Director
Ralph Z. Sorenson
/s/ CAROLE F. ST. MARK
------------------------------------------- Director
Carole F. St. Mark
/s/ BERNEE D. L. STROM
------------------------------------------- Director
Bernee D. L. Strom
/s/ ALFRED M. ZEIEN
------------------------------------------- Director
Alfred M. Zeien
</TABLE>
II-9
<PAGE>
Exhibit 1.1
POLAROID CORPORATION
[CONVERTIBLE] [SENIOR] [SUBORDINATED] DEBT SECURITIES
FORM OF UNDERWRITING AGREEMENT
New York, New York
, 1999
To the Representatives
named in Schedule I
hereto of the Underwriters
named in Schedule II hereto
Dear Sirs:
Polaroid Corporation, a Delaware corporation (the "Company"), may issue
and sell from time to time series of its [convertible] [senior] [subordinated]
debt securities registered under the registration statement[s] referred to in
Paragraph 1(a) hereof (the "Securities" and, individually, a "Security"). [The
Securities are convertible into shares of the common stock, par value $1.00 per
share, of the Company (the "Common Stock"), upon the terms and subject to the
conditions set forth in the Indenture (as defined herein) relating thereto, at
the conversion price set forth on Schedule I hereto.] The Company proposes to
sell to the underwriters named in Schedule II hereto (the "Underwriters"), for
whom you are acting as representatives (the "Representative"), a series of
Securities, of the designation, with the terms and in the aggregate principal
amount specified in Schedule I hereto (the "Underwritten Securities" and,
individually, an "Underwritten Security"). If the firm or firms listed in
Schedule II hereto include only the firm or firms listed in Schedule I hereto,
then the terms "Underwriters" and "Representative" shall each be deemed to refer
to such firm or firms.
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY. The
Company represents, warrants and agrees that:
(a) [A] [R]egistration statement[s] (No[s]. 333- and
333- ), including a prospectus, with respect to the Securities
has [have] been prepared by the Company in conformity with the
requirements of the Securities Act of 1933, as amended (the "Act"),
and the rules and regulations (the "Rules and Regulations") of the
Securities and Exchange Commission (the "Commission") thereunder and
has [have] become effective. As used in this Agreement,
(i) "Registration Statement" means [each] such registration statement,
as amended and supplemented to the date hereof [, and "Registration
Statements" means both such registration statements, as amended and
supplemented to the date hereof]; (ii) "Preliminary Prospectus" means
each prospectus (including all documents incorporated therein by
reference) included in that [the most recently filed] Registration
Statement, or amendments or supplements thereof, before it became
<PAGE>
2
effective under the Act, including any prospectus filed with the
Commission pursuant to Rule 424(a) of the Rules and Regulations; (iii)
"Basic Prospectus" means the prospectus included in the [most recently
filed] Registration Statement; and (iv) "Prospectus" means the Basic
Prospectus, together with any prospectus amendment or supplement
(including in each case all documents incorporated therein by
reference) specifically relating to the Underwritten Securities, as
filed with the Commission pursuant to paragraph (b) of Rule 424 of the
Rules and Regulations. The Commission has not issued any order
preventing or suspending the use of any Prospectus, and no proceedings
for such purposes have been instituted or are pending or, to the
knowledge of the Company, are contemplated by the Commission, and any
request on the part of the Commission for additional information has
been complied with.
(b) The Registration Statements and each Prospectus contain, and
(in the case of any amendment or supplement to any such document, or
any material incorporated by reference in any such document, filed with
the Commission after the date as of which this representation is being
made) will contain at all times during the period specified in
Paragraph 7(c) hereof, all statements which are required by the Act,
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), and the rules and regulations of the Commission under such Acts;
the Indenture, dated as of January 9, 1997 (the "Original Indenture"),
by and between the Company and State Street Bank and Trust Company, as
trustee (the "Trustee") as supplemented by a second supplemental
indenture dated as of _______ __, 1999, by and between the Company and
the Trustee (the "Second Supplemental Indenture," together with the
Original Indenture, the "Indenture"), pursuant to which the
Underwritten Securities will be issued, conforms, and with any
amendments and supplements thereto will conform, with the requirements
of the Trust Indenture Act and the rules and regulations of the
Commission thereunder; and the Registration Statements and each
Prospectus do not, and (in the case of any amendment or supplement to
any such document, or any material incorporated by reference in any
such document, filed with the Commission after the date as of which
this representation is being made) will not, at any time during the
period specified in Paragraph 7(c) hereof, contain any untrue statement
of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading; PROVIDED that the Company makes no representation or
warranty as to information contained in or omitted from any
Registration Statement or any Prospectus in reliance and based upon
information furnished to the Company through the Representative by or
on behalf of any Underwriter, or as to any statements in or omissions
from the Statement of Eligibility of the Trustee under the Indenture.
(c) Neither the Company nor the Significant Subsidiary (as defined
in paragraph (j) hereof) is in violation of its charter or by-laws or
in default under any agreement, indenture or instrument, except for
such defaults that would not result in a material
<PAGE>
3
adverse change, or any development involving a material adverse change,
in or affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and the
Significant Subsidiary (a "Material Adverse Effect"), otherwise than as
set forth or contemplated in the Prospectus; and the execution,
delivery and performance of this Agreement, the Indenture, the
Underwritten Securities, and any Delayed Delivery Contracts (as defined
in Paragraph 3 hereof) and the consummation of the transactions
contemplated herein, and in the Prospectus (including the issuance and
sale of the Underwritten Securities and the use of the proceeds from
the sale thereof as described in the Prospectus under the caption "Use
of Proceeds") have been duly authorized by all necessary corporate
action and do not and will not conflict with or constitute a breach of,
or default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or the
Significant Subsidiary pursuant to, any material agreement, indenture
or instrument to which the Company or the Significant Subsidiary is a
party or by which any of them is bound or to which any of their
respective properties or assets is subject, nor will such action result
in a material violation of the charter or by-laws of the Company or the
Significant Subsidiary or any order, rule or regulation of any court or
governmental agency having jurisdiction over the Company, the
Significant Subsidiary or their respective properties; and, except as
required by the Act, the Trust Indenture Act, the Exchange Act and
applicable state securities laws, no consent, authorization or order
of, or filing or registration with, any court or governmental agency is
required for the execution, delivery and performance of this Agreement,
the Delayed Delivery Contracts and the Indenture or the consummation of
the transactions contemplated hereby and thereby.
(d) Except as described in or contemplated by the Registration
Statements and the Prospectus, neither the Company nor any of its
subsidiaries has sustained any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree; and there has not been any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, except as described in
or contemplated by the Prospectus.
(e) KPMG Peat Marwick LLP ("KPMG"), whose report appears in the
Company's most recent Annual Report on Form 10-K which is incorporated
by reference in each Prospectus, are independent accountants as
required by the Act and the Rules and Regulations.
(f) On the Delivery Date (as defined in Paragraph 6 hereof), (i)
the Indenture will have been validly authorized, executed and delivered
by the Company and duly qualified under the Trust Indenture Act and
will constitute the legally binding obligation of the
<PAGE>
4
Company, (ii) the Underwritten Securities will have been validly
authorized and executed and, upon payment therefor as provided in this
Agreement, will be validly issued and outstanding, and will constitute
legally binding obligations of the Company entitled to the benefits of
the Indenture, and (iii) the Underwritten Securities and the Indenture
will conform to the descriptions thereof contained in the Prospectus.
(g) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully
paid and non-assessable and conform to the description thereof
contained in the Prospectus.
[(h) All of the shares of Common Stock issuable upon conversion of
the Underwritten Securities have been duly and validly authorized and
reserved for issuance upon such conversion and, when issued and
delivered in accordance with the terms of the Indenture, will be duly
and validly issued, fully paid and non-assessable.]
(i) This Agreement has been validly authorized, executed and
delivered by the Company.
(j) The Company and the Significant Subsidiary have been duly
incorporated and are validly existing and remain subsisting
corporations under the laws of their respective jurisdictions of
incorporation, are duly qualified to do business and in good standing
as foreign corporations in each jurisdiction in which their respective
ownership of properties or the conduct of their respective businesses
require such qualification, except where the failure to so qualify
would not have a Material Adverse Effect, and have power and authority
necessary to own or hold their respective properties and to conduct the
businesses in which they are engaged and, with respect to the Company,
to enter into and perform its obligations under this Agreement; and
none of the subsidiaries of the Company (other than Polaroid
International B.V. (the "Significant Subsidiary")) is a "significant
subsidiary," as such term is defined in Rule 405 of the Rules and
Regulations.
(k) There is no material action, suit or proceeding before any
court or governmental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, threatened, against or affecting
the Company or the Significant Subsidiary, which is required to be
disclosed in any Prospectus (other than as disclosed therein), or which
might reasonably be expected to have a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the
transactions contemplated in this Agreement or the performance by the
Company of its obligations hereunder.
<PAGE>
5
(l) The financial statements filed as part of the Registration
Statements or included in any Preliminary Prospectus present, or (in
the case of any amendment or supplement to any such document, or any
material incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will present at all times during the period specified in
Paragraph 7(c) hereof, fairly, the financial condition and results of
operations of the Company and its consolidated subsidiaries, at the
dates and for the periods indicated, and have been, and (in the case of
any amendment or supplement to any such document, or any material
incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will be at all times during the period specified in Paragraph
7(c) hereof, prepared in conformity with generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout the
periods involved. The supporting schedules incorporated by reference in
any Prospectus present fairly in accordance with GAAP the information
required to be stated therein. The pro forma financial statements and
the related notes thereto incorporated by reference in the Registration
Statements and any Prospectus present fairly the information shown
therein, have been prepared in accordance with the Commission's rules
and guidelines with respect to pro forma financial statements and have
been properly compiled on the bases described therein, and the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein.
(m) The documents incorporated by reference into any Preliminary
Prospectus or Prospectus have been, and (in the case of any amendment
or supplement to any such document, or any material incorporated by
reference in any such document, filed with the Commission after the
date as of which this representation is being made) will be at all
times during the period specified in Paragraph 7(c) hereof, prepared by
the Company in conformity with the applicable requirements of the Act
and Rules and Regulations and the Exchange Act and the rules and
regulations of the Commission thereunder and such documents have been,
or (in the case of any amendment or supplement to any such document, or
any material incorporated by reference in any such document, filed with
the Commission after the date as of which this representation is being
made) will be at all times during the period specified in Paragraph
7(c) hereof, timely filed as required thereby.
(n) There are no contracts or other documents which are required
to be filed as exhibits to the Registration Statements by the Act or by
the Rules and Regulations, or which were required to be filed as
exhibits to any document incorporated by reference in any Prospectus by
the Exchange Act or the rules and regulations of the Commission
thereunder, which have not been filed as exhibits to the Registration
Statements or to such document or incorporated therein by reference as
permitted by the Rules and
<PAGE>
6
Regulations or the rules and regulations of the Commission under the
Exchange Act as required.
(o) The Company and the Significant Subsidiary have good and valid
title to all or substantially all of their respective properties.
(p) The Company is not, and upon the issuance and sale of the
Underwritten Securities as herein contemplated and the application of
the net proceeds therefrom as described in the Prospectus will not be,
an "investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the Investment Company Act of
1940, as amended (the "1940 Act").
2. PURCHASE OF THE UNDERWRITTEN SECURITIES BY THE UNDERWRITERS. Subject
to the terms and conditions and in reliance upon the representations and
warranties herein set forth, the Company agrees to sell to each Underwriter,
severally and not jointly, and each Underwriter agrees, severally and not
jointly, to purchase from the Company, at the purchase price and on the other
terms set forth in Schedule I hereto, the principal amount of the Underwritten
Securities set forth opposite its name in Schedule II hereto.
3. DELAYED DELIVERY CONTRACTS. Any offer to purchase Underwritten
Securities by institutional investors solicited by the Underwriters for delayed
delivery shall be made pursuant to contracts substantially in the form of
Exhibit A attached hereto, with such changes therein as the Company and the
Representative may approve (the "Delayed Delivery Contracts"). The Company shall
have the right, in its sole discretion, to approve or disapprove each such
institutional investor. Underwritten Securities which are subject to Delayed
Delivery Contracts are herein sometimes called "Delayed Delivery Underwritten
Securities" and Underwritten Securities which are not subject to Delayed
Delivery Contracts are herein sometimes called "Immediate Delivery Underwritten
Securities."
Contemporaneously with the purchase on the Delivery Date by the
Underwriters of the Immediate Delivery Underwritten Securities pursuant to this
Agreement, the Company will pay to the Representative, for the account of the
Underwriters, the compensation specified in Schedule I hereto for arranging the
sale of Delayed Delivery Underwritten Securities. The Underwriters shall have no
responsibility with respect to the validity or performance of any Delayed
Delivery Contracts.
For the purposes of determining the principal amount of Immediate
Delivery Underwritten Securities to be purchased by each Underwriter, there
shall be deducted from the principal amount of Underwritten Securities to be
purchased by such Underwriter as set forth in Schedule II hereto that portion of
the aggregate principal amount of Delayed Delivery Underwritten Securities that
the principal amount of Underwritten Securities to be purchased by such
Underwriter as set forth in Schedule II hereto bears to the aggregate principal
amount of
<PAGE>
7
Underwritten Securities set forth there to be purchased by all of the
Underwriters (in each case as adjusted by the Representative to avoid fractions
of the minimum principal amount in which the Underwritten Securities may be
issued), except to the extent that the Representative determines, in its
discretion, that such deduction shall be otherwise than in such proportion and
so advises the Company.
4. CONDITIONS OF THE COMPANY'S OBLIGATIONS. The Company shall not be
obligated to deliver any Underwritten Securities except upon payment for all
Immediate Delivery Underwritten Securities to be purchased pursuant to this
Agreement as hereinafter provided.
5. DEFAULTING UNDERWRITERS. If any Underwriter defaults in the
performance of its obligations under this Agreement, the remaining
non-defaulting Underwriters, if any, shall be obligated to purchase the
Immediate Delivery Underwritten Securities which the defaulting Underwriter
agreed but failed to purchase in the respective proportions which the principal
amount of Underwritten Securities set forth in Schedule II hereto to be
purchased by each remaining non-defaulting Underwriter set forth therein bears
to the aggregate principal amount of Underwritten Securities set forth therein
to be purchased by all the remaining non-defaulting Underwriters; PROVIDED that
the remaining non-defaulting Underwriters shall not be obligated to purchase any
Immediate Delivery Underwritten Securities if the aggregate principal amount of
Immediate Delivery Underwritten Securities which the defaulting Underwriter or
Underwriters agreed but failed to purchase exceeds 9.09% of the total principal
amount of Underwritten Securities, and any remaining non-defaulting Underwriter
shall not be obligated to purchase more than 110% of the principal amount of
Underwritten Securities set forth in Schedule II hereto to be purchased by it.
If the foregoing maximums are exceeded, the remaining non-defaulting
Underwriters, or those other underwriters satisfactory to the Representative who
so agree, shall have the right, but shall not be obligated, to purchase, in such
proportion as may be agreed upon among them, all the Immediate Delivery
Underwritten Securities. If the remaining Underwriters or other underwriters
satisfactory to the Representative do not elect to purchase the Immediate
Delivery Underwritten Securities which the defaulting Underwriter or
Underwriters agreed but failed to purchase, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter or the Company,
except that the Company will continue to be liable for the payment of expenses
as set forth in Paragraph 7(k) hereof.
Nothing contained in this Paragraph 5 shall relieve a defaulting
Underwriter of any liability it may have to the Company for damages caused by
its default. If other underwriters are obligated or agree to purchase the
Immediate Delivery Underwritten Securities of a defaulting or withdrawing
Underwriter, either the Representative or the Company may postpone the Delivery
Date for up to seven full business days in order to effect any changes that in
the opinion of counsel for the Company or counsel for the Underwriters may be
necessary in the Registration Statements, any Prospectus or in any other
document or arrangement.
<PAGE>
8
6. DELIVERY AND PAYMENT FOR THE SECURITIES. Delivery of and payment for
the Immediate Delivery Underwritten Securities shall be made at such address,
date and time as may be specified in Schedule I hereto. This date and time are
sometimes referred to as the "Delivery Date." On the Delivery Date, the Company
shall deliver the Immediate Delivery Underwritten Securities to The Depository
Trust Company, on behalf of the Representative, for the account of each
Underwriter against payment to the Company by wire transfer of immediately
available funds to a bank account designated by the Company. Time shall be of
the essence, and delivery at the time and place specified pursuant to this
Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Immediate Delivery Underwritten Securities shall
be in registered form and in such denominations as may be set forth on Schedule
I hereto. The certificates representing the Immediate Delivery Underwritten
Securities shall be registered in the name of Cede & Co. and shall be made
available for inspection by the Representative in New York, New York not later
than 2:00 P.M., local time, on the business day prior to the Delivery Date.
7. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees:
(a) To furnish promptly to the Representative and to counsel for
the Underwriters a conformed copy of each Registration Statement as
originally filed and each amendment or supplement thereto filed prior
to the date hereof or relating to or covering the Underwritten
Securities, and a copy of each Prospectus filed with the Commission,
including all documents incorporated therein by reference and all
consents and exhibits filed therewith;
(b) To deliver promptly to the Representative such reasonable
number of the following documents as the Representative may request:
(i) conformed copies of the Registration Statements (excluding exhibits
other than the computation of the ratio of earnings to fixed charges,
the Indenture and this Agreement), (ii) each Prospectus and (iii) any
documents incorporated by reference in the Prospectus;
(c) During such period following the date hereof as, in the
opinion of counsel for the Underwriters, any Prospectus is required by
law to be delivered, to comply with the Act, the Exchange Act, the
Trust Indenture Act and the rules and regulations under each thereof,
so as to permit the completion of the distribution of the Underwritten
Securities as contemplated in this Agreement and in each Prospectus. If
at any time when a prospectus is required by the Act to be delivered in
connection with sales of the Underwritten Securities, any event shall
occur or condition shall exist as a result of which it is necessary, in
the reasonable opinion of counsel for the Underwriters or for the
Company, to amend any Registration Statement or amend or supplement any
Prospectus in order that such Prospectus will not include any untrue
statements of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the
light of the circumstances existing at the time it is delivered to a
<PAGE>
9
purchaser, or if it shall be necessary, in the opinion of such counsel,
at any such time to amend any Registration Statement or amend or
supplement any Prospectus in order to comply with the requirements of
the Act or the Rules and Regulations, the Company will promptly prepare
and file with the Commission, subject to paragraph (d) below, such
amendment or supplement as may be necessary to correct such statement
or omission or to make any such Registration Statement or any such
Prospectus comply with such requirements, and the Company will furnish
to the Underwriters such number of copies of such amendment or
supplement as the Underwriters may reasonably request;
(d) Prior to filing with the Commission during the period referred
to in (c) above (i) any amendment or supplement to any Registration
Statement, (ii) any Prospectus or any amendment or supplement thereto
or (iii) any document incorporated by reference in any of the foregoing
or any amendment or supplement to such incorporated document, to
furnish a copy thereof to the Representative and to counsel for the
Underwriters and not to file any document that shall have been
disapproved by the Representative;
(e) To advise the Representative promptly (i) when any
post-effective amendment to any Registration Statement relating to or
covering the Underwritten Securities becomes effective or any
supplement to any Prospectus shall have been filed, (ii) of any
comments from the Commission or any request or proposed request by the
Commission for an amendment or supplement to any Registration Statement
(insofar as the amendment or supplement relates to or covers the
Underwritten Securities), to any Prospectus, to any document
incorporated by reference in any of the foregoing or for any additional
information, (iii) of the issuance by the Commission of any stop order
suspending the effectiveness of any Registration Statement or any order
directed to any Prospectus or any document incorporated therein by
reference or the initiation or threat of any stop order proceeding or
of any challenge to the accuracy or adequacy of any document
incorporated by reference in any Prospectus, (iv) of receipt by the
Company of any notification with respect to the suspension of the
qualification of the Underwritten Securities for sale in any
jurisdiction or the initiation or threat of any proceeding for that
purpose and (v) of the happening of any event which makes untrue any
statement of a material fact made in any Registration Statement
(insofar as such Registration Statement relates to or covers the
Underwritten Securities) or any Prospectus or which requires the making
of a change in any Registration Statement or any Prospectus in order to
make any material statement therein not misleading;
(f) If, during the period referred to in (c) above, the Commission
shall issue a stop order suspending the effectiveness of any
Registration Statement, to make every reasonable effort to obtain the
lifting of that order at the earliest possible time;
(g) As soon as practicable, to make generally available to its
security holders and to deliver to the Representative an earnings
statement, conforming with the requirements of
<PAGE>
10
Section 11(a) of the Act, covering a period of at least twelve months
beginning after the latest of (i) the most recent effective date of the
registration statement relating to part of the Underwritten Securities,
(ii) the effective date of the most recent post-effective amendment to
the last Registration Statement that became effective prior to the date
of this Agreement and (iii) the date of the Company's most recent
Annual Report on Form 10-K filed with the Commission prior to the date
of this Agreement;
(h) So long as any of the Underwritten Securities are outstanding,
to furnish to the Representative copies of all reports and financial
statements furnished by the Company to each securities exchange on
which securities issued by the Company may be listed pursuant to
requirements of or agreements with such exchange or to the Commission
pursuant to the Exchange Act or any rule or regulation of the
Commission thereunder;
(i) To endeavor to qualify the Underwritten Securities for offer
and sale under the securities laws of such jurisdictions as the
Representative may reasonably request and to maintain such
qualifications in effect for as long as may be required for the
distribution of the Underwritten Securities; PROVIDED, HOWEVER, that
the Company shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation or as a
dealer in securities in any jurisdiction in which it is not so
qualified or to subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise so subject;
(j) To use its best efforts to obtain the listing of the
Underwritten Securities [and the Common Stock issuable upon conversion
of the Underwritten Securities] on the securities exchange, if any, set
forth on Schedule I (the "Stock Exchange") on or prior to the Delivery
Date [, or prior to the initial issuance of such Common Stock, if any,]
and to cause such listing to be continued so long as any amount of the
Securities [or the Common Stock issued upon conversion of the
Underwritten Securities, if any,] remain[s] outstanding; to furnish
from time to time any and all documents, instruments, information and
undertakings that may be necessary in order to effect such listing; and
to maintain the same until none of the Underwritten Securities [or the
Common Stock issued upon conversion of the Underwritten Securities, if
any,] is outstanding or until such time as payment of principal of and
premium, if any, and interest on all the Underwritten Securities has
been duly provided for, whichever is earlier; PROVIDED that if the
Company can no longer reasonably maintain such listing, the Company
shall use its best efforts to obtain and maintain the quotation for, or
listing of, the Underwritten Securities [and the Common Stock issued
upon conversion of the Underwritten Securities, if any,] on such other
securities exchange or exchanges as the Company may, with the approval
of the Representative, determine;
(k) To pay the costs incident to the authorization, issuance, sale
and delivery of the Underwritten Securities and any taxes payable in
that connection; the costs incident to the
<PAGE>
11
preparation, printing and filing under the Act of the Registration
Statements and any amendments, supplements and exhibits thereto; the
costs incident to the preparation, printing and filing of any document
and any amendments and exhibits thereto required to be filed by the
Company under the Exchange Act; the costs of distributing the
Registration Statements as originally filed and each amendment and
post-effective amendment thereof (including exhibits), any Preliminary
Prospectus, each Prospectus and any documents incorporated by reference
in any of the foregoing documents; the costs of printing this Agreement
and the Delayed Delivery Contracts, if any; the fees and disbursements
of the Company's counsel, accountants and other advisors; the fees and
expenses of the Trustee, including the fees and disbursements of
counsel for the Trustee in connection with the Indenture and the
Underwritten Securities, to the extent the Trustee or its counsel, as
the case may be, requires reimbursement thereof; [the fees of the
Transfer Agent and Registrar, if any, relating to the Common Stock
issuable upon conversion of the Underwritten Securities, if any]; the
costs of any filings with the National Association of Securities
Dealers, Inc.; fees paid to rating agencies in connection with the
rating of the Securities, including the Underwritten Securities; the
fees and expenses of qualifying the Underwritten Securities under the
securities laws of the several jurisdictions as provided in this
paragraph and of preparing and printing a Blue Sky Memorandum and the
costs of advising on the legality of the Common Securities, which are
issuable upon conversion of the Underwritten Securities, if any, for
investment (including fees of counsel to the Underwriters); the cost of
listing the Underwritten Securities [and the Common Stock issuable upon
conversion of the Underwritten Securities, if any] on the Stock
Exchange; and all other costs and expenses incident to the performance
of the Company's obligations under this Agreement; PROVIDED that,
except as provided in this paragraph and in Paragraph 11 hereof, the
Underwriters shall pay their own costs and expenses, including the fees
and expenses of their counsel, any transfer taxes on the Underwritten
Securities which they may sell and the expenses of advertising any
offering of the Underwritten Securities made by the Underwriters;
(l) Until the termination of the offering of the Underwritten
Securities, to timely file all documents, and any amendments to
previously filed documents, required to be filed by the Company
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act; and
(m) During the period beginning on the date hereof and continuing
to the Delivery Date, without the consent of the Representative, not to
offer, sell, contract to sell or otherwise dispose of any debt
securities of the Company with maturities longer than one year, other
than the Underwritten Securities to the Underwriters.
8. INDEMNIFICATION AND CONTRIBUTION. (a) The Company shall indemnify
and hold harmless each Underwriter, its officers and employees and each person,
if any, who controls any Underwriter within the meaning of the Act, from and
against any loss, claim, damage or liability, joint or several, or any action in
respect thereof (including, but not limited to, any loss, claim,
<PAGE>
12
damage, liability or action relating to purchases and sales of Securities), to
which that Underwriter, officer, employee or controlling person may become
subject, under the Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any untrue statement or
alleged untrue statement of a material fact contained (A) in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, or (B) in any blue sky application or other document
prepared or executed by the Company (or based upon any written information
furnished by the Company) specifically for the purpose of qualifying any or all
of the Securities [or the Common Stock issuable upon conversion of the
Underwritten Securities, if any,] under the securities laws of any state or
other jurisdiction (any such application, document or information being
hereinafter called a "Blue Sky Application"), or (ii) the omission or alleged
omission to state in any Preliminary Prospectus, the Registration Statement or
the Prospectus, or in any amendment or supplement thereto, or in any Blue Sky
Application any material fact required to be stated therein or necessary to make
the statements therein not misleading, and shall reimburse each Underwriter and
each such officer, employee and controlling person promptly upon demand for any
legal or other expenses reasonably incurred by that Underwriter, officer,
employee or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred; PROVIDED, HOWEVER, that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue statement or
alleged untrue statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any such
amendment or supplement, or in any Blue Sky Application in reliance upon and in
conformity with the written information furnished to the Company through the
Representative by or on behalf of any Underwriter specifically for inclusion
therein and described in Paragraph 8(e); and PROVIDED FURTHER that as to any
Preliminary Prospectus this indemnity agreement shall not inure to the benefit
of any Underwriter, its officers or employees or any person controlling that
Underwriter on account of any loss, claim, damage, liability or action arising
from the sale of Securities to any person by that Underwriter if that
Underwriter failed to send or give a copy of the Prospectus, as the same may be
amended or supplemented, to that person within the time required by the Act, and
the untrue statement or alleged untrue statement of any material fact or
omission or alleged omission to state a material fact in such Preliminary
Prospectus was corrected in the Prospectus, unless such failure resulted from
non-compliance by the Company with Paragraph 7(c). For purposes of the last
proviso to the immediately preceding sentence, the term "Prospectus" shall not
be deemed to include the documents incorporated therein by reference, and no
Underwriter shall be obligated to send or give any supplement or amendment to
any document incorporated by reference in any Preliminary Prospectus or the
Prospectus to any person other than a person to whom such Underwriter had
delivered such incorporated document or documents in response to a written
request therefor. The foregoing indemnity agreement is in addition to any
liability which the Company may otherwise have to any Underwriter or to any
officer, employee or controlling person of that Underwriter.
<PAGE>
13
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company, its officers and employees, each of its directors and
each person, if any, who controls the Company within the meaning of the Act,
from and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which the Company or any such director, officer or
controlling person may become subject, under the Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or in any amendment or supplement thereto, or (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, or in any Blue Sky Application any material fact required to
be stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with the written information furnished to the Company through the
Representative by or on behalf of that Underwriter specifically for inclusion
therein and described in Paragraph 8(e), and shall reimburse the Company and any
such director, officer or controlling person for any legal or other expenses
reasonably incurred by the Company or any such director, officer or controlling
person in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action as such expenses are
incurred. The foregoing indemnity agreement is in addition to any liability
which any Underwriter may otherwise have to the Company or any such director,
officer or controlling person.
(c) Promptly after receipt by an indemnified party under this Paragraph
8 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Paragraph 8, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Paragraph 8 except to the extent it has
been materially prejudiced by such failure and, PROVIDED FURTHER, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Paragraph 8.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Paragraph 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; PROVIDED, HOWEVER, that
any indemnified party shall have the right to employ separate counsel in any
such action and to participate in the defense thereof but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless (i) the
employment thereof has been specifically
<PAGE>
14
authorized by the indemnifying party in writing, (ii) such indemnified party
shall have been advised by such counsel that there may be one or more legal
defenses available to it which are different from or additional to those
available to the indemnifying party and in the reasonable judgment of such
counsel it is advisable for such indemnified party to employ separate counsel or
(iii) the indemnifying party has failed to assume the defense of such action and
employ counsel reasonably satisfactory to the indemnified party, in which case,
if such indemnified party notifies the indemnifying party in writing that it
elects to employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such action
on behalf of such indemnified party, it being understood, however, that the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys at any
time for all such indemnified parties, which firm shall be designated in writing
by the Representative, if the indemnified parties under this Paragraph 8 consist
of any Underwriter or any of their respective officers, employees or controlling
persons, or by the Company, if the indemnified parties under this Paragraph
consist of the Company or any of the Company's directors, officers, employees or
controlling persons. No indemnifying party shall (i) without the prior written
consent of the indemnified parties (which consent shall not be unreasonably
withheld), settle or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding, or (ii) be liable for any settlement
of any such action effected without its written consent (which consent shall not
be unreasonably withheld), but if settled with its written consent or if there
be a final judgment of the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss of liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Paragraph 8 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Paragraph 8(a) or 8(b) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters on the other from
the offering of the Securities or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and the Underwriters on
the other with respect to the statements or omissions which resulted in such
loss, claim, damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one
<PAGE>
15
hand and the Underwriters on the other with respect to such offering shall be
deemed to be in the same proportion as the total net proceeds from the offering
of the Securities purchased under this Agreement (before deducting expenses)
received by the Company, on the one hand, and the total underwriting discounts
and commissions received by the Underwriters with respect to the shares of the
Securities purchased under this Agreement, on the other hand, bear to the total
gross proceeds from the offering of the shares of the Securities under this
Agreement, in each case as set forth in the table on the cover page of the
Prospectus. The relative fault shall be determined by reference to whether the
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the Company
or the Underwriters, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this Paragraph 8(d) were to be determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take into
account the equitable considerations referred to herein. The amount paid or
payable by an indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in this Paragraph
8(d) shall be deemed to include, for purposes of this Paragraph 8(d), any legal
or other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any such action or claim. Notwithstanding the
provisions of this Paragraph 8(d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Securities underwritten by it and distributed to the public was offered to
the public exceeds the amount of any damages which such Underwriter has
otherwise paid or become liable to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as provided in
this Paragraph 8(d) are several in proportion to their respective underwriting
obligations and not joint.
(e) The Underwriters severally confirm that the statements with respect
to the public offering of the Securities set forth on the cover page of, and
under the caption "Underwriting" in, the Prospectus are correct and constitute
the only information furnished in writing to the Company by or on behalf of the
Underwriters specifically for inclusion in the Registration Statement and the
Prospectus.
9. TERMINATION. (a) The obligations of the Underwriters hereunder may
be terminated by the Representative by notice given to and received by the
Company prior to delivery of and payment for the Immediate Delivery Underwritten
Securities if, prior to that time, any of the events described in Paragraphs
10(l), 10(m) or 10(n) hereof shall have occurred or if the Underwriters shall
decline to purchase the Immediate Delivery Underwritten Securities for any
reason permitted under this Agreement.
<PAGE>
16
(b) If this Agreement is terminated pursuant to this Paragraph 9, such
termination shall be without liability of any party to any other party except as
provided in Paragraph 11 hereof, and PROVIDED FURTHER that Paragraphs 1 and 8
shall survive such termination and remain in full force and effect.
10. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS . The respective
obligations of the Underwriters under the Agreement with respect to the
Underwritten Securities are subject to the accuracy, on the date hereof and on
the Delivery Date, of the representations and warranties of the Company
contained herein, to performance by the Company of its obligations hereunder,
and to each of the following additional terms and conditions applicable to the
Underwritten Securities.
(a) At or before the Delivery Date, no stop order suspending the
effectiveness of any Registration Statement nor any order directed to
any document incorporated by reference in any Prospectus shall have
been issued and prior to that time no stop order proceeding shall have
been initiated or threatened by the Commission and no challenge shall
have been made to the accuracy or adequacy of any document incorporated
by reference in any Prospectus; any request of the Commission for
inclusion of additional information in any Registration Statement or
any Prospectus or otherwise shall have been complied with; and after
the date hereof the Company shall not have filed with the Commission
any amendment or supplement to any Registration Statement or any
Prospectus (or any document incorporated by reference therein) that
shall have been disapproved by the Representative.
(b) No Underwriter shall have discovered and disclosed to the
Company on or prior to the Delivery Date that any Registration
Statement or any Prospectus contains an untrue statement of a fact
which, in the opinion of counsel for the Underwriters, is material or
omits to state a fact which, in the opinion of such counsel, is
material and is required to be stated therein or is necessary to make
the statements therein not misleading.
(c) All corporate proceedings and other legal matters incident to
the authorization, form and validity of this Agreement, the
Underwritten Securities and the Indenture and the form of the
Registration Statements, each Prospectus (other than financial
statements and other financial data) and all other legal matters
relating to this Agreement and the transactions contemplated hereby
shall be satisfactory in all respects to counsel for the Underwriters,
and the Company shall have furnished to such counsel all documents and
information that such counsel may reasonably request to enable it to
pass upon such matters.
(d) [ ] General Counsel of the Company, shall have
furnished to the Representative his opinion addressed to the
Underwriters and dated the Delivery Date to the effect that:
<PAGE>
17
(i) The Company has been duly incorporated and is validly
existing and remains a subsisting corporation under the laws of
the State of Delaware;
(ii) The Company is duly qualified to do business and is in
good standing as a foreign corporation in all jurisdictions in
which its ownership of property or the conduct of its business
requires such qualification (except where the failure to so
qualify would not have a Material Adverse Effect), and has all
power and authority necessary to own its properties and conduct
the business in which it is engaged as described in the
Prospectus;
(iii) No order issued by the Commission directed to any
document incorporated by reference in any Prospectus has been
issued and, to the knowledge of such counsel, no challenge has
been made by the Commission to the accuracy or adequacy of any
such document;
(iv) The Company has an authorized capitalization as set
forth in the Prospectus, and all of the issued shares of capital
stock of the Company have been duly and validly authorized and
issued, are fully paid and non-assessable;
[(v) There are no preemptive or other rights to subscribe
for or to purchase, nor any restriction upon the voting or
transfer of, any shares of the Common Stock issuable upon the
conversion of the Underwritten Securities, if any, pursuant to
the Company's Charter or by-laws or any agreement or other
instrument known to such counsel;]
(vi) Such counsel does not know of any litigation or any
governmental proceeding pending or threatened against the Company
which would affect the subject matter of this Agreement or is
required to be disclosed in any Prospectus (including the
documents incorporated by reference therein) which is not
disclosed and correctly summarized therein; and
(vii) The execution, delivery and performance of this
Agreement and the Delayed Delivery Contracts, if any, and
compliance by the Company with the provisions of the Underwritten
Securities and the Indenture [and the issuance and delivery of the
Common Stock issuable upon conversion of the Underwritten
Securities, if any,] will not constitute a breach of, or result in
the creation or imposition of any lien, charge or encumbrance upon
any of the assets of the Company pursuant to the terms of, or
constitute a default under, any agreement, indenture or instrument
known to such counsel, or result in a violation of the Charter or
by-laws of the Company or, to the best of such counsel's
knowledge, any order, rule or regulation of any court or
governmental agency having jurisdiction over the Company or its
property.
<PAGE>
18
In giving such opinion, such counsel need not express any opinion
regarding any order, consent or other authorization or approval which
may be legally required pursuant to any state securities law.
In rendering such opinion, such counsel may: (i) state that his
opinion is limited to matters governed by the federal laws of the
United States of America, the laws of the District of Columbia and the
General Corporation Law of the State of Delaware and that such counsel
is not admitted in the State of Delaware; and (ii) rely (to the extent
such counsel deems proper and specifies in his opinion), as to matters
involving the application of the laws of other jurisdictions upon the
opinion of other counsel of good standing, PROVIDED that such other
counsel is satisfactory to counsel for the Underwriters and furnishes a
copy of its opinion to the Representative.
(e) Boekel de Neree, special Netherlands counsel to the
Significant Subsidiary, shall have furnished to the Representative its
opinion addressed to the Underwriters and dated the Delivery Date, to
the effect that the Significant Subsidiary has been duly incorporated
and is validly existing as a private limited liability company under
the laws of The Netherlands and has the corporate power and authority
to carry on the business described in the objects clause of its
Articles of Association.
(f) Simpson Thacher & Bartlett, counsel for the Company, shall
have furnished to the Representative its opinion addressed to the
Underwriters and dated the Delivery Date, to the effect that:
(i) The Company has been duly incorporated and is
validly existing and in good standing as a corporation under the
laws of the State of Delaware;
(ii) The Indenture has been duly authorized, executed
and delivered by the Company and duly qualified under the Trust
Indenture Act and, assuming that the Indenture is a valid and
binding agreement of the Trustee, constitutes a valid and legally
binding instrument of the Company enforceable against the Company
in accordance with its terms;
(iii) The Immediate Delivery Underwritten Securities
have been duly authorized, executed and issued by the Company and,
assuming due authentication thereof by the Trustee and upon
payment and delivery in accordance with this Agreement, will
constitute valid and legally binding obligations of the Company
enforceable against the Company in accordance with their terms and
entitled to the benefits of the Indenture;
(iv) The Delayed Delivery Underwritten Securities, if
any, have been duly authorized and, when duly executed and issued
by the Company and, assuming due
<PAGE>
19
authentication thereof by the Trustee and upon payment and
delivery by the respective purchasers thereof in accordance with
the terms of the related Delayed Delivery Contracts, will
constitute valid and legally binding obligations of the Company,
enforceable in accordance with their terms and entitled to the
benefits of the Indenture;
(v) The Delayed Delivery Contracts, if any, have been
duly authorized, executed and delivered by the Company and,
assuming that the Delayed Delivery Contracts are the valid and
binding agreements of the purchasers thereunder, are valid and
legally binding obligations of the parties thereto;
[(vi) The Common Stock issuable on the conversion of the
Underwritten Securities has been duly authorized and reserved for
issuance upon such conversion and, when issued and delivered in
accordance with the terms of the Charter, will be duly and validly
issued, fully paid and non-assessable;]
(vii) The statements made in each Prospectus under the
caption[s] "Description of Debt Securities" [and "Description of
Capital Stock -- Common Stock"] (or [, with respect to each,] a
comparable caption), insofar as they purport to constitute
summaries of the documents referred to therein, constitute
accurate summaries of the terms of such documents in all material
respects;
(viii) Each Registration Statement is effective under
the Act and, to the knowledge of such counsel, no stop order
suspending its effectiveness has been issued and no proceeding for
that purpose is pending or threatened by the Commission;
(ix) This Agreement has been duly authorized, executed
and delivered by the Company; and
(x) The Company is not an "investment company" or an
entity "controlled" by an "investment company," as such terms are
defined in the 1940 Act.
Such counsel may state that the opinions set forth in paragraphs (ii),
(iii), (iv) and (v) above are subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other similar laws
relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
In rendering such opinion, such counsel may state that its opinion is
limited to matters governed by the federal laws of the United States of America,
the laws of the State of New York and the General Corporation Law of the State
of Delaware and that such counsel is not admitted in the State of Delaware.
<PAGE>
20
Such counsel shall also have furnished to the Representative a written
statement, addressed to the Underwriters and dated the Delivery Date, in form
and substance satisfactory to the Representative, to the effect that (1) such
counsel has acted as counsel to the Company in connection with the preparation
of the Registration Statements and the offer and sale of the Securities
(although the Company is also represented by its General Counsel and, with
respect to certain other matters, by other outside counsel); (2) in the course
of the preparation by the Company of the Registration Statements and the
Prospectus, such counsel participated in conferences with certain officers and
employees of the Company, with representatives of KPMG and with counsel to the
Company; (3) prior to the Company's filing with the Commission documents under
the Exchange Act, such counsel reviewed such documents; and (4) based on (a)
such counsel's examination of the Registration Statements, the Prospectus and
the documents filed by the Company under the Exchange Act, (b) such counsel's
investigation made in connection with the preparation of Registration Statements
and the Prospectus (excluding the documents filed by the Company under the
Exchange Act) and (c) such counsel's participation in the conferences referred
to in clause (2) of this paragraph above, (i) that such counsel is of the
opinion that the Registration Statements, as of their respective effective
dates, and each Prospectus, as of its issue date, complied as to form in all
material respects with the requirements of the Act and the Trust Indenture Act
and the applicable rules and regulations of the Commission thereunder, and each
document incorporated by reference in each Prospectus as filed under the
Exchange Act complied as to form when filed in all material respects with the
requirements of the Exchange Act and the applicable rules and regulations of the
Commission thereunder, except that in each case no opinion need be expressed as
to the financial statements and other financial data contained or incorporated
by reference therein, and (ii) such counsel has no reason to believe that (I)
either Registration Statement, on the dates they became effective (or, with
respect to such Registration Statements, if the Company has filed an Annual
Report on Form 10-K since their effective dates, the date of the Company's most
recent Annual Report on Form 10-K), contained any untrue statement of a material
fact or omitted to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading or that the
Prospectus, as of its issue date and as of the Delivery Date, contains any
untrue statement of a material fact or omits to state any material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading or (II)
any document incorporated by reference in the Prospectus when they were filed
with the Commission contained any untrue statement of a material fact or omitted
to state any material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading, except
that with respect to each of clauses (I) and (II) above, such counsel may state
that it expresses no belief with respect to the financial statements or other
financial data contained in or incorporated by reference in the Registration
Statements, the Prospectus or documents filed by the Company under the Exchange
Act. The foregoing opinion and statement may be qualified by a statement to the
effect that such counsel has not independently verified the accuracy,
completeness or fairness of the statements made or included in the Registration
Statements, the Prospectus or the documents filed by the
<PAGE>
21
Company under the Exchange Act and takes no responsibility therefor, except as
and to the extent set forth in paragraph (vii) above.
(g) The Company shall have furnished to the Representative a
certificate, dated the Delivery Date, of its Chairman of the Board, its
President or a Vice President and its chief financial officer stating
that:
(i) The representations, warranties and agreements of
the Company in Paragraph 1 are true and correct as of the Delivery
Date; the Company has complied with all its agreements contained
herein; and the conditions set forth in Paragraph 10(a) have been
fulfilled;
(ii) (A) Except as described in or contemplated by the
Registration Statements and the Prospectus, neither the Company
nor any of its subsidiaries has sustained, any loss or
interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, or
(B) there has not been any change, or any development involving a
prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as
described in or contemplated by the Prospectus; and
(iii) They have carefully examined the Registration
Statements and the Prospectus and, in their opinion (A) the
Registration Statements, as of their respective effective dates,
and the Prospectus, as of its issue date, did not include any
untrue statement of a material fact and did not omit to state any
material fact required to be stated therein or necessary to make
the statements therein not misleading, and (B) since the effective
date of Registration Statement (No. 333- ), no event has occurred
which should have been set forth in a supplement or amendment to
either of the Registration Statements or the Prospectus.
(h) (i) Neither the Company nor any of its subsidiaries shall have
sustained, except as described in or contemplated by the Registration
Statements and the Prospectus, any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, or (ii) there shall not have been
any change, or any development involving a prospective change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in clause
(i) or (ii), is, in the judgment of the Representative, so material and
adverse as to make it impracticable or inadvisable to proceed with the
public
<PAGE>
22
offering or the delivery of the Securities on the terms and in the
manner contemplated in the Prospectus.
(i) If Underwritten Securities in bearer form are being delivered
by the Company on the Delivery Date in a jurisdiction other than the
United States, the Company shall have furnished to the Representative
such legal opinion or opinions as the Representative may reasonably
request addressed to the Underwriters and dated the Delivery Date, with
respect to matters relating to the offering, sale and delivery of the
Underwritten Securities in such jurisdiction.
(j) The Company shall have furnished to the Representative (i) a
letter of KPMG, addressed to the Underwriters and dated the date hereof
of the type described in the American Institute of Certified Public
Accountants' Statement on Auditing Standards No. 72 and covering such
specified financial statement items as counsel for the Underwriters may
reasonably have requested and (ii) a letter of KPMG, addressed to the
Underwriters and dated the Delivery Date, stating, as of the date of
such letter (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than five
days prior to the date of such letter), the conclusions and findings of
such firm with respect to the financial information and other matters
covered by its letter referred to in subclause (i) above, confirming in
all material respects the conclusions and findings set forth in such
prior letter.
(k) The Underwritten Securities shall have been accepted for
listing on the Stock Exchange (if any), subject to official notice of
issuance.
(l) (i) Neither the Company nor the Significant Subsidiary shall
have sustained, except as described in or contemplated by the
Registration Statements and the Prospectus, any loss or interference
with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court
or governmental action, order or decree, or (ii) there shall not have
been any change, or any development involving a prospective change, in
or affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and the
Significant Subsidiary, otherwise than as described in or contemplated
by the Prospectus, the effect of which, in any such case described in
clause (i) or (ii), is, in the judgment of the Representative, so
material and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Securities on
the terms and in the manner contemplated in the Prospectus.
(m) Subsequent to the execution and delivery of this Agreement,
(i) no downgrading shall have occurred in the rating accorded the
Company's debt securities by any "nationally recognized statistical
rating organization," as that term is defined by the
<PAGE>
23
Commission for purposes of Rule 436(g)(2) of the Rules and Regulations
and (ii) no such organization shall have publicly announced that it has
under surveillance or review, with possible negative implications, its
rating of any of the Company's debt securities.
(n) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange or the American
Stock Exchange or in the over-the-counter market, or trading in any
securities of the Company on any exchange or in the over-the-counter
market, shall have been suspended or minimum prices shall have been
established on any such exchange or such market by the Commission, by
such exchange or by any other regulatory body or governmental authority
having jurisdiction, (ii) a banking moratorium shall have been declared
by federal or state authorities, (iii) the United States shall have
become engaged in hostilities, there shall have been an escalation in
hostilities involving the United States or there shall have been a
declaration of a national emergency or war by the United States or (iv)
there shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of
international conditions on the financial markets in the United States
shall be such) as to make it, in the judgment of a majority in interest
of the several Underwriters, impracticable or inadvisable to proceed
with the public offering or delivery of the Securities on the terms and
in the manner contemplated in the Prospectus.
All opinions, letters, evidence and certificates mentioned above
or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance
satisfactory to counsel for the Underwriters.
11. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the Company shall fail
to tender the Immediate Delivery Underwritten Securities for delivery to the
Underwriters for any reason permitted under this Agreement, or if the
Underwriters shall decline to purchase the Immediate Delivery Underwritten
Securities for any reason permitted under this Agreement (other than pursuant to
Paragraph 5 hereof), the Company shall reimburse the Underwriters for reasonable
fees and expenses of their counsel and for such other out-of-pocket expenses as
shall have been incurred by them in connection with this Agreement and the
proposed purchase of Immediate Delivery Underwritten Securities and the
solicitation of any purchases of the Delayed Delivery Underwritten Securities,
and upon demand the Company shall pay the full amount thereof to the
Representative. If this Agreement is terminated pursuant to Paragraph 5 hereof
by reason of the default of one or more Underwriters, the Company shall not be
obligated to reimburse any defaulting Underwriter on account of those expenses.
12. NOTICES, ETC. The Company shall be entitled to act and rely upon
any request, consent, notice or agreement by, or on behalf of, the
Representative. Any notice by the Company to the Underwriters shall be
sufficient if given in writing or by telegraph addressed to the Representative
at its address set forth in Schedule I hereto, and any notice by the
Underwriters to
<PAGE>
24
the Company shall be sufficient if given in writing or by facsimile addressed to
the Company at 784 Memorial Drive, Cambridge, Massachusetts 02139 (Facsimile
Number: (781) 386-3228), Attention of the Treasurer.
13. PERSONS ENTITLED TO THE BENEFIT OF THIS AGREEMENT. This Agreement
shall be binding upon the Underwriters, the Company, and their respective
successors. This Agreement and the terms and provisions hereof are for the sole
benefit of only those persons, except that (a) the representations, warranties,
indemnities and agreements of the Company contained in this Agreement shall also
be deemed to be for the benefit of the person or persons, if any, who control
any Underwriter within the meaning of Section 15 of the Act, and (b) the
indemnity agreement of the Underwriters contained in Paragraph 8 hereof shall be
deemed to be for the benefit of directors of the Company, officers of the
Company who have signed any Registration Statement and any person controlling
the Company. Nothing in this Agreement is intended or shall be construed to give
any person, other than the persons referred to in this Paragraph, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
14. CERTAIN DEFINITIONS. For purposes of this Agreement, (a) "business
day" means any day on which the New York Stock Exchange, Inc. is open for
trading and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
15. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
16. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
17. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
[THE REST OF THIS PAGE IS LEFT BLANK INTENTIONALLY; THE SIGNATURE PAGE FOLLOWS.]
<PAGE>
25
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this Agreement shall represent a binding agreement among the Company and the
several Underwriters.
Very truly yours,
POLAROID CORPORATION
By
--------------------------------
Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
[ ]
By
--------------------------------
Name:
Title:
For itself and as Representative of the
other Underwriters named in Schedule II
to the foregoing Agreement.
<PAGE>
SCHEDULE I
Underwriting Agreement dated , 1999.
Registration Statement No.'s 333- and 333- .
Representatives and Addresses:
Underwritten Securities
Designation:
Principal amount:
Indenture:
Date of Maturity:
Interest Rate:
Purchase Price:
[Conversion Price of
Common Stock:]
Redemption Provisions:
Authorized Denominations:
Stock Exchange Listing:
Delivery Date, Time and Location:
<PAGE>
SCHEDULE II
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF
UNDERWRITTEN
NAME OF UNDERWRITER SECURITIES
- ------------------- ------------
<S> <C>
........................................................................................... $
...........................................................................................
Total
--------
$
--------
--------
</TABLE>
<PAGE>
EXHIBIT A
$
POLAROID CORPORATION
[CONVERTIBLE] [SENIOR] [SUBORDINATED] DEBT SECURITIES
DELAYED DELIVERY CONTRACT
[DATE]
POLAROID CORPORATION
784 Memorial Drive
Cambridge, Massachusetts 02139
Dear Sirs:
The undersigned hereby agrees to purchase from Polaroid Corporation, a
Delaware corporation ("Company"), and the Company hereby agrees to sell to the
undersigned,
$
principal amount of the Company's above-captioned securities ("Securities"),
offered by the Company's prospectus dated , 1999, as supplemented by the
prospectus supplement dated , 1999 (collectively, the "Prospectus"),
receipt of a copy of which is hereby acknowledged, at a purchase price of % of
the principal amount thereof plus accrued interest from , 1999 to the
Delivery Date (as defined in the next paragraph) and on the further terms and
conditions set forth in this Contract.
Payment for and delivery of the Securities to be purchased by the
undersigned shall be made on , 1999 , herein called the "Delivery
Date."
At 10:00 A.M., New York time, on the Delivery Date, the Securities to
be purchased by the undersigned hereunder will be delivered by the Company to
the undersigned, and the undersigned will accept delivery of such Securities and
will make payment to the Company of the purchase price therefor, at the office
of . Payment will be certified or official bank check payable in
next-day funds settled through the New York Clearing House to or upon the order
of the Company.
This Contract will terminate and be of no further force and effect
after , 1999, unless (i) on or before such date it shall have been
executed and delivered by both parties hereto or (ii) the Company shall have
sold to the Underwriters named in the Prospectus the Immediate Delivery
Underwritten Securities (as defined in the Underwriting Agreement referred to in
the Prospectus) and the Company shall have mailed or delivered to the
undersigned at its address set forth below a notice to that effect, stating the
date of the occurrence thereof, accompanied by
<PAGE>
2
copies of the opinion of counsel for the Company delivered to such Underwriters
pursuant to Paragraph 10(f) of the Underwriting Agreement.
The obligation of the undersigned to accept delivery and make payment
for the Securities on the Delivery Date will be subject to the condition that
the Securities shall not, on the Delivery Date, be an investment prohibited by
the laws of the jurisdiction to which the undersigned is subject, the
undersigned hereby representing that such an investment is not so prohibited on
the date hereof. This Contract will inure to the benefit of and be binding upon
the parties hereto and their respective successors but will not be assignable by
either party hereto without the written consent of the other.
It is understood that acceptance of any Delayed Delivery Contract (as
defined in said Underwriting Agreement) is in the Company's sole discretion and,
without limiting the foregoing, need not be on a first-come, first-served basis.
If this Contract is acceptable to the Company, it is requested that the Company
sign the form of acceptance below and mail or deliver one of the counterparts
hereof to the undersigned at its address set forth below. This will become a
binding contract between the Company and the undersigned when such counterpart
is so mailed or delivered.
Very truly yours,
By
------------------------------
Name:
Title:
Address:
Accepted as of , 199 .
POLAROID CORPORATION
By
----------------------------------
Name:
Title:
<PAGE>
Exhibit 1.2
POLAROID CORPORATION
COMMON STOCK
FORM OF UNDERWRITING AGREEMENT
New York, New York
, 1999
To the Representatives
named in Schedule I
hereto of the Underwriters
named in Schedule II hereto
Dear Sirs:
Polaroid Corporation, a Delaware corporation (the "Company"), may issue
and sell from time to time its common stock, par value $1.00 per share,
registered under the registration statement[s] referred to in Paragraph 1(a)
hereof (the "Common Stock"). The Company proposes to sell to the underwriters
named in Schedule II hereto (the "Underwriters"), for whom you are acting as
representatives (the "Representative"), the number of shares of Common Stock
specified in Schedule I hereto (the "Underwritten Shares" and, individually, an
"Underwritten Share"). If the firm or firms listed in Schedule II hereto include
only the firm or firms listed in Schedule I hereto, then the terms
"Underwriters" and "Representative" shall each be deemed to refer to such firm
or firms.
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY. The
Company represents, warrants and agrees that:
(a) [A] [R]egistration statement[s] (No[s]. 333- and 333- ),
including a prospectus, with respect to the Common Stock has [have]
been prepared by the Company in conformity with the requirements of the
Securities Act of 1933, as amended (the "Act"), and the rules and
regulations (the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder and has [have] become
effective. As used in this Agreement, (i) "Registration Statement"
means [each] such registration statement, as amended and supplemented
to the date hereof [and "Registration Statements" means both such
registration statements, as amended and supplemented to the date
hereof]; (ii) "Preliminary Prospectus" means each prospectus (including
all documents incorporated therein by reference) included in that [the
most recently filed] Registration Statement, or amendments or
supplements thereof, before it became effective under the Act,
including any prospectus filed with the Commission pursuant to Rule
424(a) of the Rules and Regulations; (iii) "Basic Prospectus" means the
prospectus included in the [most recently filed] Registration
Statement; and (iv) "Prospectus" means the Basic Prospectus, together
with any prospectus amendment or supplement (including
<PAGE>
2
in each case all documents incorporated therein by reference)
specifically relating to the Underwritten Shares, as filed with the
Commission pursuant to paragraph (b) of Rule 424 of the Rules and
Regulations. The Commission has not issued any order preventing or
suspending the use of any Prospectus, and no proceedings for such
purposes have been instituted or are pending or, to the knowledge of
the Company, are contemplated by the Commission, and any request on the
part of the Commission for additional information has been complied
with.
(b) The Registration Statements and each Prospectus contain, and
(in the case of any amendment or supplement to any such document, or
any material incorporated by reference in any such document, filed with
the Commission after the date as of which this representation is being
made) will contain at all times during the period specified in
Paragraph 6(c) hereof, all statements which are required by the Act,
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and the rules and regulations of the Commission under such Acts; and
the Registration Statements and each Prospectus do not, and (in the
case of any amendment or supplement to any such document, or any
material incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will not, at any time during the period specified in Paragraph
6(c) hereof, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading; PROVIDED that the Company
makes no representation or warranty as to information contained in or
omitted from any Registration Statement or any Prospectus in reliance
and based upon information furnished to the Company through the
Representative by or on behalf of any Underwriter.
(c) Neither the Company nor the Significant Subsidiary (as defined
in paragraph (h) hereof) is in violation of its corporate charter or
by-laws or in default under any agreement, indenture or instrument,
except for such defaults that would not result in a material adverse
change, or any development involving a material adverse change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and the
Significant Subsidiary (a "Material Adverse Effect"), otherwise than as
set forth or contemplated in the Prospectus; and the execution,
delivery and performance of this Agreement and the consummation of the
transactions contemplated herein, and in the Prospectus (including the
issuance and sale of the Underwritten Shares and the use of the
proceeds from the sale thereof as described in the Prospectus under the
caption "Use of Proceeds") have been duly authorized by all necessary
corporate action and do not and will not conflict with or constitute a
breach of, or default under, or result in the creation or imposition of
any lien, charge or encumbrance upon any property or assets of the
Company or the Significant Subsidiary pursuant to, any material
agreement, indenture or instrument to which the Company or the
Significant Subsidiary is a party or by which any of them is bound or
to which any of their respective properties or assets is subject, nor
will such action result in a material
<PAGE>
3
violation of the corporate charter or by-laws of the Company or the
Significant Subsidiary or any order, rule or regulation of any court or
governmental agency having jurisdiction over the Company, the
Significant Subsidiary or their respective properties; and except as
required by the Act, the Exchange Act and applicable state securities
laws, no consent, authorization or order of, or filing or registration
with, any court or governmental agency is required for the execution,
delivery and performance of this Agreement or the consummation of the
transactions contemplated hereby and thereby.
(d) Except as described in or contemplated by the Registration
Statements and the Prospectus, neither the Company nor any of its
subsidiaries has sustained any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree; and there has not been any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, except as described in
or contemplated by the Prospectus.
(e) KPMG Peat Marwick LLP ("KPMG"), whose report appears in the
Company's most recent Annual Report on Form 10-K which is incorporated
by reference in each Prospectus, are independent accountants as
required by the Act and the Rules and Regulations.
(f) On the Delivery Date (as defined in Paragraph 5 hereof), the
Underwritten Shares (i) will have been duly and validly authorized,
(ii) will be, when issued and delivered against payment therefor, as
provided in this Agreement, validly issued, fully paid and
non-assessable and (iii) will conform to the description thereof
contained in the Prospectus.
(g) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully
paid and non-assessable and conform to the description thereof
contained in the Prospectus.
(h) This Agreement has been validly authorized, executed and
delivered by the Company.
(i) The Company and the Significant Subsidiary have been duly
incorporated and are validly existing and remain subsisting
corporations under the laws of their respective jurisdictions of
incorporation, are duly qualified to do business and in good standing
as foreign corporations in each jurisdiction in which their respective
ownership of properties or the conduct of their respective businesses
require such qualification, except where the
<PAGE>
4
failure to so qualify would not have a Material Adverse Effect, and
have power and authority necessary to own or hold their respective
properties and to conduct the businesses in which they are engaged and,
with respect to the Company, to enter into and perform its obligations
under this Agreement; and none of the subsidiaries of the Company
(other than Polaroid International B.V. (the "Significant Subsidiary"))
is a "significant subsidiary," as such term is defined in Rule 405 of
the Rules and Regulations.
(j) There is no material action, suit or proceeding before any
court or governmental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, threatened, against or affecting
the Company or the Significant Subsidiary, which is required to be
disclosed in any Prospectus (other than as disclosed therein), or which
might reasonably be expected to have a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the
transactions contemplated in this Agreement or the performance by the
Company of its obligations hereunder.
(k) The financial statements filed as part of the Registration
Statements or included in any Preliminary Prospectus present, or (in
the case of any amendment or supplement to any such document, or any
material incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will present at all times during the period specified in
Paragraph 6(c) hereof, fairly, the financial condition and results of
operations of the Company and its consolidated subsidiaries, at the
dates and for the periods indicated, and have been, and (in the case of
any amendment or supplement to any such document, or any material
incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will be at all times during the period specified in Paragraph
6(c) hereof, prepared in conformity with generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout the
periods involved. The supporting schedules incorporated by reference in
any Prospectus present fairly in accordance with GAAP the information
required to be stated therein. The pro forma financial statements and
the related notes thereto incorporated by reference in the Registration
Statements and any Prospectus present fairly the information shown
therein, have been prepared in accordance with the Commission's rules
and guidelines with respect to pro forma financial statements and have
been properly compiled on the bases described therein, and the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein.
(l) The documents incorporated by reference into any Preliminary
Prospectus or Prospectus have been, and (in the case of any amendment
or supplement to any such document, or any material incorporated by
reference in any such document, filed with the
<PAGE>
5
Commission after the date as of which this representation is being
made) will be at all times during the period specified in Paragraph
6(c) hereof, prepared by the Company in conformity with the applicable
requirements of the Act and Rules and Regulations and the Exchange Act
and the rules and regulations of the Commission thereunder and such
documents have been, or (in the case of any amendment or supplement to
any such document, or any material incorporated by reference in any
such document, filed with the Commission after the date as of which
this representation is being made) will be at all times during the
period specified in Paragraph 6(c) hereof, timely filed as required
thereby.
(m) There are no contracts or other documents which are required
to be filed as exhibits to the Registration Statements by the Act or by
the Rules and Regulations, or which were required to be filed as
exhibits to any document incorporated by reference in any Prospectus by
the Exchange Act or the rules and regulations of the Commission
thereunder, which have not been filed as exhibits to the Registration
Statements or to such document or incorporated therein by reference as
permitted by the Rules and Regulations or the rules and regulations of
the Commission under the Exchange Act as required.
(n) The Company and the Significant Subsidiary have good and valid
title to all or substantially all of their respective properties.
(o) The Company is not, and upon the issuance and sale of the
Underwritten Shares as herein contemplated and the application of the
net proceeds therefrom as described in the Prospectus will not be, an
"investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the Investment Company Act of
1940, as amended (the "1940 Act").
2. PURCHASE OF THE UNDERWRITTEN SHARES BY THE UNDERWRITERS. Subject to
the terms and conditions and in reliance upon the representations and warranties
herein set forth, the Company agrees to sell to each Underwriter, severally and
not jointly, and each Underwriter agrees, severally and not jointly, to purchase
from the Company, at the purchase price and on the other terms set forth in
Schedule I hereto, the number of Underwritten Shares set forth opposite its name
in Schedule II hereto.
3. CONDITIONS OF THE COMPANY'S OBLIGATIONS. The Company shall not be
obligated to deliver any Underwritten Shares except upon payment for all
Underwritten Shares to be purchased pursuant to this Agreement as hereinafter
provided.
4. DEFAULTING UNDERWRITERS. If any Underwriter defaults in the
performance of its obligations under this Agreement, the remaining
non-defaulting Underwriters, if any, shall be obligated to purchase the
Underwritten Shares which the defaulting Underwriter agreed but failed
<PAGE>
6
to purchase in the respective proportions which the number of Underwritten
Shares set forth in Schedule II hereto to be purchased by each remaining
non-defaulting Underwriter set forth therein bears to the aggregate number of
Underwritten Shares set forth therein to be purchased by all the remaining
non-defaulting Underwriters; PROVIDED that the remaining non-defaulting
Underwriters shall not be obligated to purchase any Underwritten Shares if the
aggregate number of Delivery Underwritten Shares which the defaulting
Underwriter or Underwriters agreed but failed to purchase exceeds 9.09% of the
total number of Underwritten Shares, and any remaining non-defaulting
Underwriter shall not be obligated to purchase more than 110% of the number of
Underwritten Shares set forth in Schedule II hereto to be purchased by it. If
the foregoing maximums are exceeded, the remaining non-defaulting Underwriters,
or those other underwriters satisfactory to the Representative who so agree,
shall have the right, but shall not be obligated, to purchase, in such
proportion as may be agreed upon among them, all the Underwritten Shares. If the
remaining Underwriters or other underwriters satisfactory to the Representative
do not elect to purchase the Underwritten Shares which the defaulting
Underwriter or Underwriters agreed but failed to purchase, this Agreement shall
terminate without liability on the part of any non-defaulting Underwriter or the
Company, except that the Company will continue to be liable for the payment of
expenses as set forth in Paragraph 6(k) hereof.
Nothing contained in this Paragraph 4 shall relieve a defaulting
Underwriter of any liability it may have to the Company for damages caused by
its default. If other underwriters are obligated or agree to purchase the
Underwritten Shares of a defaulting or withdrawing Underwriter, either the
Representative or the Company may postpone the Delivery Date for up to seven
full business days in order to effect any changes that in the opinion of counsel
for the Company or counsel for the Underwriters may be necessary in the
Registration Statements, any Prospectus or in any other document or arrangement.
5. DELIVERY AND PAYMENT FOR THE UNDERWRITTEN SHARES. Delivery of and
payment for the Underwritten Shares shall be made at such address, date and time
as may be specified in Schedule I hereto. This date and time are sometimes
referred to as the "Delivery Date." On the Delivery Date, the Company shall
deliver the Underwritten Shares to the Representative, for the account of each
Underwriter against payment to the Company by wire transfer of immediately
available funds to a bank account designated by the Company. Time shall be of
the essence, and delivery at the time and place specified pursuant to this
Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Underwritten Shares shall be in registered form
and in such denominations as may be set forth on Schedule I hereto. The
certificates representing the Underwritten Shares shall be made available for
inspection by the Representative in New York, New York not later than 2:00 P.M.,
local time, on the business day prior to the Delivery Date.
6. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees:
<PAGE>
7
(a) To furnish promptly to the Representative and to counsel for
the Underwriters a conformed copy of each Registration Statement as
originally filed and each amendment or supplement thereto filed prior
to the date hereof or relating to or covering the Underwritten Shares,
and a copy of each Prospectus filed with the Commission, including all
documents incorporated therein by reference and all consents and
exhibits filed therewith;
(b) To deliver promptly to the Representative such reasonable
number of the following documents as the Representative may request:
(i) conformed copies of the Registration Statements (excluding exhibits
other than this Agreement), (ii) each Prospectus and (iii) any
documents incorporated by reference in the Prospectus;
(c) During such period following the date hereof as, in the
opinion of counsel for the Underwriters, any Prospectus is required by
law to be delivered, to comply with the Act, the Exchange Act and the
rules and regulations under each thereof, so as to permit the
completion of the distribution of the Underwritten Shares as
contemplated in this Agreement and in each Prospectus. If at any time
when a prospectus is required by the Act to be delivered in connection
with sales of the Underwritten Shares, any event shall occur or
condition shall exist as a result of which it is necessary, in the
reasonable opinion of counsel for the Underwriters or for the Company,
to amend any Registration Statement or amend or supplement any
Prospectus in order that such Prospectus will not include any untrue
statements of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the
light of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the opinion of such counsel,
at any such time to amend any Registration Statement or amend or
supplement any Prospectus in order to comply with the requirements of
the Act or the Rules and Regulations, the Company will promptly prepare
and file with the Commission, subject to paragraph (d) below, such
amendment or supplement as may be necessary to correct such statement
or omission or to make any such Registration Statement or any such
Prospectus comply with such requirements, and the Company will furnish
to the Underwriters such number of copies of such amendment or
supplement as the Underwriters may reasonably request;
(d) Prior to filing with the Commission during the period referred
to in (c) above (i) any amendment or supplement to any Registration
Statement, (ii) any Prospectus or any amendment or supplement thereto
or (iii) any document incorporated by reference in any of the foregoing
or any amendment or supplement to such incorporated document, to
furnish a copy thereof to the Representative and to counsel for the
Underwriters and not to file any document that shall have been
disapproved by the Representative;
(e) To advise the Representative promptly (i) when any
post-effective amendment to any Registration Statement relating to or
covering the Underwritten Shares becomes
<PAGE>
8
effective or any supplement to any Prospectus shall have been filed,
(ii) of any comments from the Commission or any request or proposed
request by the Commission for an amendment or supplement to any
Registration Statement (insofar as the amendment or supplement relates
to or covers the Underwritten Shares), to any Prospectus, to any
document incorporated by reference in any of the foregoing or for any
additional information, (iii) of the issuance by the Commission of any
stop order suspending the effectiveness of any Registration Statement
or any order directed to any Prospectus or any document incorporated
therein by reference or the initiation or threat of any stop order
proceeding or of any challenge to the accuracy or adequacy of any
document incorporated by reference in any Prospectus, (iv) of receipt
by the Company of any notification with respect to the suspension of
the qualification of the Underwritten Shares for sale in any
jurisdiction or the initiation or threat of any proceeding for that
purpose and (v) of the happening of any event which makes untrue any
statement of a material fact made in any Registration Statement
(insofar as such Registration Statement relates to or covers the
Underwritten Shares) or any Prospectus or which requires the making of
a change in any Registration Statement or any Prospectus in order to
make any material statement therein not misleading;
(f) If, during the period referred to in (c) above, the Commission
shall issue a stop order suspending the effectiveness of any
Registration Statement, to make every reasonable effort to obtain the
lifting of that order at the earliest possible time;
(g) As soon as practicable, to make generally available to its
security holders and to deliver to the Representative an earnings
statement, conforming with the requirements of Section 11(a) of the
Act, covering a period of at least twelve months beginning after the
latest of (i) the most recent effective date of the registration
statement relating to part of the Underwritten Shares, (ii) the
effective date of the most recent post-effective amendment to the last
Registration Statement that became effective prior to the date of this
Agreement and (iii) the date of the Company's most recent Annual Report
on Form 10-K filed with the Commission prior to the date of this
Agreement;
(h) So long as any of the Underwritten Shares are outstanding, to
furnish to the Representative copies of all reports and financial
statements furnished by the Company to each securities exchange on
which securities issued by the Company may be listed pursuant to
requirements of or agreements with such exchange or to the Commission
pursuant to the Exchange Act or any rule or regulation of the
Commission thereunder;
(i) To endeavor to qualify the Underwritten Shares for offer and
sale under the securities laws of such jurisdictions as the
Representative may reasonably request and to maintain such
qualifications in effect for as long as may be required for the
distribution of the Underwritten Shares; PROVIDED, HOWEVER, that the
Company shall not be obligated to file any general consent to service
of process or to qualify as a foreign corporation or as a
<PAGE>
9
dealer in securities in any jurisdiction in which it is not so
qualified or to subject itself to taxation in respect of doing business
in any jurisdiction in which it is not otherwise so subject;
(j) To use its best efforts to obtain the listing of the
Underwritten Shares on the securities exchange, if any, set forth on
Schedule I (the "Stock Exchange") on or prior to the Delivery Date and
to cause such listing to be continued so long as any amount of
Underwritten Shares remain outstanding; to furnish from time to time
any and all documents, instruments, information and undertakings that
may be necessary in order to effect such listing; and to maintain the
same until none of the Underwritten Shares is outstanding; PROVIDED
that if the Company can no longer reasonably maintain such listing, the
Company shall use its best efforts to obtain and maintain the quotation
for, or listing of, the Underwritten Shares, on such other securities
exchange or exchanges as the Company may, with the approval of the
Representative, determine;
(k) To pay the costs incident to the authorization, issuance, sale
and delivery of the Underwritten Shares and any taxes payable in that
connection; the costs incident to the preparation, printing and filing
under the Act of the Registration Statements and any amendments,
supplements and exhibits thereto; the costs incident to the
preparation, printing and filing of any document and any amendments and
exhibits thereto required to be filed by the Company under the Exchange
Act; the costs of distributing the Registration Statements as
originally filed and each amendment and post-effective amendment
thereof (including exhibits), any Preliminary Prospectus, each
Prospectus and any documents incorporated by reference in any of the
foregoing documents; the costs of printing this Agreement; the fees and
disbursements of the Company's counsel, accountants and other advisors;
the fees of the Transfer Agent and Registrar; the costs of any filings
with the National Association of Securities Dealers, Inc.; the fees and
expenses of qualifying the Underwritten Shares under the securities
laws of the several jurisdictions as provided in this paragraph and of
preparing and printing a Blue Sky Memorandum and the costs of advising
on the legality of the Common Stock for investment (including fees of
counsel to the Underwriters); the cost of listing the Underwritten
Shares on the Stock Exchange; and all other costs and expenses incident
to the performance of the Company's obligations under this Agreement;
PROVIDED that, except as provided in this paragraph and in Paragraph 10
hereof, the Underwriters shall pay their own costs and expenses,
including the fees and expenses of their counsel, any transfer taxes on
the Underwritten Shares which they may sell and the expenses of
advertising any offering of the Underwritten Shares made by the
Underwriters;
(l) Until the termination of the offering of the Underwritten
Shares, to timely file all documents, and any amendments to previously
filed documents, required to be filed by the Company pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act; and
<PAGE>
10
(m) During the period beginning on the date hereof and continuing
to the Delivery Date, without the consent of the Representative, not to
offer, sell, contract to sell or otherwise dispose of any debt
securities of the Company with maturities longer than one year, other
than the Underwritten Shares to the Underwriters.
7. INDEMNIFICATION AND CONTRIBUTION. (a) The Company shall indemnify
and hold harmless each Underwriter, its officers and employees and each person,
if any, who controls any Underwriter within the meaning of the Act, from and
against any loss, claim, damage or liability, joint or several, or any action in
respect thereof (including, but not limited to, any loss, claim, damage,
liability or action relating to purchases and sales of Securities), to which
that Underwriter, officer, employee or controlling person may become subject,
under the Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained (A) in any Preliminary Prospectus,
the Registration Statement or the Prospectus, or in any amendment or supplement
thereto, or (B) in any blue sky application or other document prepared or
executed by the Company (or based upon any written information furnished by the
Company) specifically for the purpose of qualifying any or all of the
Underwritten Shares under the securities laws of any state or other jurisdiction
(any such application, document or information being hereinafter called a "Blue
Sky Application"), or (ii) the omission or alleged omission to state in any
Preliminary Prospectus, the Registration Statement or the Prospectus, or in any
amendment or supplement thereto, or in any Blue Sky Application any material
fact required to be stated therein or necessary to make the statements therein
not misleading, and shall reimburse each Underwriter and each such officer,
employee and controlling person promptly upon demand for any legal or other
expenses reasonably incurred by that Underwriter, officer, employee or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred; PROVIDED, HOWEVER, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Prospectus,
the Registration Statement or the Prospectus, or in any such amendment or
supplement, or in any Blue Sky Application in reliance upon and in conformity
with the written information furnished to the Company through the Representative
by or on behalf of any Underwriter specifically for inclusion therein and
described in Paragraph 7(e); and PROVIDED FURTHER that as to any Preliminary
Prospectus this indemnity agreement shall not inure to the benefit of any
Underwriter, its officers or employees or any person controlling that
Underwriter on account of any loss, claim, damage, liability or action arising
from the sale of Securities to any person by that Underwriter if that
Underwriter failed to send or give a copy of the Prospectus, as the same may be
amended or supplemented, to that person within the time required by the Act, and
the untrue statement or alleged untrue statement of any material fact or
omission or alleged omission to state a material fact in such Preliminary
Prospectus was corrected in the Prospectus, unless such failure resulted from
non-compliance by the Company with Paragraph 6(c). For purposes of the last
proviso to the immediately preceding sentence, the term "Prospectus" shall not
be deemed to include the
<PAGE>
11
documents incorporated therein by reference, and no Underwriter shall be
obligated to send or give any supplement or amendment to any document
incorporated by reference in any Preliminary Prospectus or the Prospectus to any
person other than a person to whom such Underwriter had delivered such
incorporated document or documents in response to a written request therefor.
The foregoing indemnity agreement is in addition to any liability which the
Company may otherwise have to any Underwriter or to any officer, employee or
controlling person of that Underwriter.
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company, its officers and employees, each of its directors and
each person, if any, who controls the Company within the meaning of the Act,
from and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which the Company or any such director, officer or
controlling person may become subject, under the Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or in any amendment or supplement thereto, or (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, or in any Blue Sky Application any material fact required to
be stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with the written information furnished to the Company through the
Representative by or on behalf of that Underwriter specifically for inclusion
therein and described in Paragraph 7(e), and shall reimburse the Company and any
such director, officer or controlling person for any legal or other expenses
reasonably incurred by the Company or any such director, officer or controlling
person in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action as such expenses are
incurred. The foregoing indemnity agreement is in addition to any liability
which any Underwriter may otherwise have to the Company or any such director,
officer or controlling person.
(c) Promptly after receipt by an indemnified party under this Paragraph
7 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Paragraph 7, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Paragraph 7 except to the extent it has
been materially prejudiced by such failure and, PROVIDED FURTHER, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Paragraph 7.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying
<PAGE>
12
party, to assume the defense thereof with counsel satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party under this
Paragraph 7 for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than reasonable
costs of investigation; PROVIDED, HOWEVER, that any indemnified party shall have
the right to employ separate counsel in any such action and to participate in
the defense thereof but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the employment thereof has been
specifically authorized by the indemnifying party in writing, (ii) such
indemnified party shall have been advised by such counsel that there may be one
or more legal defenses available to it which are different from or additional to
those available to the indemnifying party and in the reasonable judgment of such
counsel it is advisable for such indemnified party to employ separate counsel or
(iii) the indemnifying party has failed to assume the defense of such action and
employ counsel reasonably satisfactory to the indemnified party, in which case,
if such indemnified party notifies the indemnifying party in writing that it
elects to employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such action
on behalf of such indemnified party, it being understood, however, that the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys at any
time for all such indemnified parties, which firm shall be designated in writing
by the Representative, if the indemnified parties under this Paragraph 7 consist
of any Underwriter or any of their respective officers, employees or controlling
persons, or by the Company, if the indemnified parties under this Paragraph
consist of the Company or any of the Company's directors, officers, employees or
controlling persons. No indemnifying party shall (i) without the prior written
consent of the indemnified parties (which consent shall not be unreasonably
withheld), settle or compromise or consent to the entry of any judgment with
respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding, or (ii) be liable for any settlement
of any such action effected without its written consent (which consent shall not
be unreasonably withheld), but if settled with its written consent or if there
be a final judgment of the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss of liability by reason of such settlement or judgment.
<PAGE>
13
(d) If the indemnification provided for in this Paragraph 7 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Paragraph 7(a) or 7(b) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters on the other from
the offering of the Underwritten Shares or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and the
Underwriters on the other with respect to the statements or omissions which
resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other with
respect to such offering shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Underwritten Shares purchased under
this Agreement (before deducting expenses) received by the Company, on the one
hand, and the total underwriting discounts and commissions received by the
Underwriters with respect to the shares of the Underwritten Shares purchased
under this Agreement, on the other hand, bear to the total gross proceeds from
the offering of the shares of the Underwritten Shares under this Agreement, in
each case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to whether the untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or the
Underwriters, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and equitable
if contributions pursuant to this Paragraph 7(d) were to be determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Paragraph 7(d) shall be
deemed to include, for purposes of this Paragraph 7(d), any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Paragraph 7(d), no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at which
the Underwritten Shares underwritten by it and distributed to the public was
offered to the public exceeds the amount of any damages which such Underwriter
has otherwise paid or become liable to pay by reason of any untrue or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as provided in
this Paragraph 7(d) are several in proportion to their respective underwriting
obligations and not joint.
<PAGE>
14
(e) The Underwriters severally confirm that the statements with respect
to the public offering of the Underwritten Shares set forth on the cover page
of, and under the caption "Underwriting" in, the Prospectus are correct and
constitute the only information furnished in writing to the Company by or on
behalf of the Underwriters specifically for inclusion in the Registration
Statement and the Prospectus.
8. TERMINATION. (a) The obligations of the Underwriters hereunder may
be terminated by the Representative by notice given to and received by the
Company prior to delivery of and payment for the Underwritten Shares if, prior
to that time, any of the events described in Paragraphs 9(k) or 9(l) hereof
shall have occurred or if the Underwriters shall decline to purchase the
Underwritten Shares for any reason permitted under this Agreement.
(b) If this Agreement is terminated pursuant to this Paragraph 8, such
termination shall be without liability of any party to any other party except as
provided in Paragraph 10 hereof, and PROVIDED FURTHER that Paragraphs 1 and 7
shall survive such termination and remain in full force and effect.
9. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS . The respective
obligations of the Underwriters under the Agreement with respect to the
Underwritten Shares are subject to the accuracy, on the date hereof and on the
Delivery Date, of the representations and warranties of the Company contained
herein, to performance by the Company of its obligations hereunder, and to each
of the following additional terms and conditions applicable to the Underwritten
Shares.
(a) At or before the Delivery Date, no stop order suspending the
effectiveness of any Registration Statement nor any order directed to
any document incorporated by reference in any Prospectus shall have
been issued and prior to that time no stop order proceeding shall have
been initiated or threatened by the Commission and no challenge shall
have been made to the accuracy or adequacy of any document incorporated
by reference in any Prospectus; any request of the Commission for
inclusion of additional information in any Registration Statement or
any Prospectus or otherwise shall have been complied with; and after
the date hereof the Company shall not have filed with the Commission
any amendment or supplement to any Registration Statement or any
Prospectus (or any document incorporated by reference therein) that
shall have been disapproved by the Representative.
(b) No Underwriter shall have discovered and disclosed to the
Company on or prior to the Delivery Date that any Registration
Statement or any Prospectus contains an untrue statement of a fact
which, in the opinion of counsel for the Underwriters, is material or
omits to state a fact which, in the opinion of such counsel, is
material and is required to be stated therein or is necessary to make
the statements therein not misleading.
<PAGE>
15
(c) All corporate proceedings and other legal matters incident to
the authorization, form and validity of this Agreement, the
Underwritten Shares and the form of the Registration Statements, each
Prospectus (other than financial statements and other financial data)
and all other legal matters relating to this Agreement and the
transactions contemplated hereby shall be satisfactory in all respects
to counsel for the Underwriters, and the Company shall have furnished
to such counsel all documents and information that such counsel may
reasonably request to enable it to pass upon such matters.
(d) [ ], General Counsel of the Company, shall have
furnished to the Representative his opinion addressed to the
Underwriters and dated the Delivery Date to the effect that:
(i) The Company has been duly incorporated and is validly
existing and remains a subsisting corporation under the laws of
the State of Delaware;
(ii) The Company is duly qualified to do business and is in
good standing as a foreign corporation in all jurisdictions in
which its ownership of property or the conduct of its business
requires such qualification (except where the failure to so
qualify would not have a Material Adverse Effect), and has all
power and authority necessary to own its properties and conduct
the business in which it is engaged as described in the
Prospectus;
(iii) No order issued by the Commission directed to any
document incorporated by reference in any Prospectus has been
issued and, to the knowledge of such counsel, no challenge has
been made by the Commission to the accuracy or adequacy of any
such document;
(iv) The Company has an authorized capitalization as set
forth in the Prospectus, and all of the issued shares of capital
stock of the Company (including the Underwritten Shares being
delivered on the Delivery Date) have been duly and validly
authorized and issued, are fully paid and non-assessable;
(v) There are no preemptive or other rights to subscribe
for or to purchase, nor any restriction upon the voting or
transfer of, any Underwritten Shares pursuant to the Company's
charetr or by-laws or any agreement or other instrument known to
such counsel;
(vi) Such counsel does not know of any litigation or any
governmental proceeding pending or threatened against the Company
which would affect the subject matter of this Agreement or is
required to be disclosed in any Prospectus (including the
documents incorporated by reference therein) which is not
disclosed and correctly summarized therein; and
<PAGE>
16
(vii) The execution, delivery and performance of this
Agreement and the issuance and delivery of the Underwritten
Shares, will not constitute a breach of, or result in the creation
or imposition of any lien, charge or encumbrance upon any of the
assets of the Company pursuant to the terms of, or constitute a
default under, any agreement, indenture or instrument known to
such counsel, or result in a violation of the charter or by-laws
of the Company or, to the best of such counsel's knowledge, any
order, rule or regulation of any court or governmental agency
having jurisdiction over the Company or its property.
In giving such opinion, such counsel need not express any opinion
regarding any order, consent or other authorization or approval which
may be legally required pursuant to any state securities law.
In rendering such opinion, such counsel may: (i) state that his
opinion is limited to matters governed by the federal laws of the
United States of America, the laws of the District of Columbia and the
General Corporation Law of the State of Delaware and that such counsel
is not admitted in the State of Delaware; and (ii) rely (to the extent
such counsel deems proper and specifies in his opinion), as to matters
involving the application of the laws of other jurisdictions upon the
opinion of other counsel of good standing, PROVIDED that such other
counsel is satisfactory to counsel for the Underwriters and furnishes a
copy of its opinion to the Representative.
(e) Boekel de Neree, special Netherlands counsel to the
Significant Subsidiary, shall have furnished to the Representative its
opinion addressed to the Underwriters and dated the Delivery Date, to
the effect that the Significant Subsidiary has been duly incorporated
and is validly existing as a private limited liability company under
the laws of The Netherlands and has the corporate power and authority
to carry on the business described in the objects clause of its
Articles of Association.
(f) Simpson Thacher & Bartlett, counsel for the Company, shall
have furnished to the Representative its opinion addressed to the
Underwriters and dated the Delivery Date, to the effect that:
(i) The Company has been duly incorporated and is
validly existing and in good standing as a corporation under the
laws of the State of Delaware;
(ii) The Underwritten Shares have been duly authorized
by the Company and, upon payment and delivery in accordance with
the Underwriting Agreement, the Underwritten Shares will be
validly issued, fully paid and non-assessable;
(iii) The statements made in each Prospectus under the
caption "Description of Capital Stock -- Common Stock" (or a
comparable caption), insofar as it purports
<PAGE>
17
to constitute a summary of the documents referred to therein,
constitute accurate summary of the terms of such documents in all
material respects;
(iv) Each Registration Statement is effective under the
Act and, to the knowledge of such counsel, no stop order
suspending its effectiveness has been issued and no proceeding for
that purpose is pending or threatened by the Commission;
(v) This Agreement has been duly authorized, executed
and delivered by the Company; and
(vi) The Company is not an "investment company" or an
entity "controlled" by an "investment company," as such terms are
defined in the 1940 Act.
In rendering such opinion, such counsel may state that its opinion is
limited to matters governed by the federal laws of the United States of America,
the laws of the State of New York and the General Corporation Law of the State
of Delaware and that such counsel is not admitted in the State of Delaware.
Such counsel shall also have furnished to the Representative a written
statement, addressed to the Underwriters and dated the Delivery Date, in form
and substance satisfactory to the Representative, to the effect that (1) such
counsel has acted as counsel to the Company in connection with the preparation
of the Registration Statements and the offer and sale of the Common Stock
(although the Company is also represented by its General Counsel and, with
respect to certain other matters, by other outside counsel); (2) in the course
of the preparation by the Company of the Registration Statements and the
Prospectus, such counsel participated in conferences with certain officers and
employees of the Company, with representatives of KPMG and with counsel to the
Company; (3) prior to the Company's filing with the Commission documents under
the Exchange Act, such counsel reviewed such documents; and (4) based on (a)
such counsel's examination of the Registration Statements, the Prospectus and
the documents filed by the Company under the Exchange Act, (b) such counsel's
investigation made in connection with the preparation of Registration Statements
and the Prospectus (excluding the documents filed by the Company under the
Exchange Act) and (c) such counsel's participation in the conferences referred
to in clause (2) of this paragraph above, (i) that such counsel is of the
opinion that the Registration Statements, as of their respective effective
dates, and each Prospectus, as of its issue date, complied as to form in all
material respects with the requirements of the Act and the Rules and
Regulations, and each document incorporated by reference in each Prospectus as
filed under the Exchange Act complied as to form when filed in all material
respects with the requirements of the Exchange Act and the applicable rules and
regulations of the Commission thereunder, except that in each case no opinion
need be expressed as to the financial statements and other financial data
contained or incorporated by reference therein, and (ii) such counsel has no
reason to believe that (I) either Registration Statement, on the dates they
became effective (or, with respect to such Registration Statements, if the
Company has filed an
<PAGE>
18
Annual Report on Form 10-K since their effective dates, the date of the
Company's most recent Annual Report on Form 10-K), contained any untrue
statement of a material fact or omitted to state any material fact required to
be stated therein or necessary in order to make the statements therein not
misleading or that the Prospectus, as of its issue date and as of the Delivery
Date, contains any untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading or (II) any document incorporated by reference in the Prospectus
when they were filed with the Commission contained any untrue statement of a
material fact or omitted to state any material fact necessary in order to make
the statements therein, in light of the circumstances under which they were
made, not misleading, except that with respect to each of clauses (I) and (II)
above, such counsel may state that it expresses no belief with respect to the
financial statements or other financial data contained in or incorporated by
reference in the Registration Statements, the Prospectus or documents filed by
the Company under the Exchange Act. The foregoing opinion and statement may be
qualified by a statement to the effect that such counsel has not independently
verified the accuracy, completeness or fairness of the statements made or
included in the Registration Statements, the Prospectus or the documents filed
by the Company under the Exchange Act and takes no responsibility therefor,
except as and to the extent set forth in paragraph vii above.
(g) The Company shall have furnished to the Representative a
certificate, dated the Delivery Date, of its Chairman of the Board, its
President or a Vice President and its chief financial officer stating
that:
(i) The representations, warranties and agreements of
the Company in Paragraph 1 are true and correct as of the Delivery
Date; the Company has complied with all its agreements contained
herein; and the conditions set forth in Paragraph 9(a) have been
fulfilled;
(ii) (A) Except as described in or contemplated by the
Registration Statements and the Prospectus, neither the Company
nor any of its subsidiaries has sustained, any loss or
interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, or
(B) there has not been any change, or any development involving a
prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as
described in or contemplated by the Prospectus; and
(iii) They have carefully examined the Registration
Statements and the Prospectus and, in their opinion (A) the
Registration Statements, as of their respective effective dates,
and the Prospectus, as of its issue date, did not include any
untrue statement of a material fact and did not omit to state any
material fact required to be
<PAGE>
19
stated therein or necessary to make the statements therein not
misleading, and (B) since the effective date of Registration
Statement (No. 333- ), no event has occurred which should have
been set forth in a supplement or amendment to either of the
Registration Statements or the Prospectus.
(h) (i) Neither the Company nor any of its subsidiaries shall have
sustained, except as described in or contemplated by the Registration
Statements and the Prospectus, any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, or (ii) there shall not have been
any change, or any development involving a prospective change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any such case described in clause
(i) or (ii), is, in the judgment of the Representative, so material and
adverse as to make it impracticable or inadvisable to proceed with the
public offering or the delivery of the Underwritten Shares on the terms
and in the manner contemplated in the Prospectus.
(i) The Company shall have furnished to the Representative (i) a
letter of KPMG, addressed to the Underwriters and dated the date hereof
of the type described in the American Institute of Certified Public
Accountants' Statement on Auditing Standards No. 72 and covering such
specified financial statement items as counsel for the Underwriters may
reasonably have requested and (ii) a letter of KPMG, addressed to the
Underwriters and dated the Delivery Date, stating, as of the date of
such letter (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than five
days prior to the date of such letter), the conclusions and findings of
such firm with respect to the financial information and other matters
covered by its letter referred to in subclause (i) above, confirming in
all material respects the conclusions and findings set forth in such
prior letter.
(j) The Underwritten Shares shall have been accepted for listing
on the Stock Exchange (if any), subject to official notice of issuance.
(k) (i) Neither the Company nor the Significant Subsidiary shall
have sustained, except as described in or contemplated by the
Registration Statements and the Prospectus, any loss or interference
with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court
or governmental action, order or decree, or (ii) there shall not have
been any change, or any development involving a prospective change, in
or affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and the
Significant Subsidiary, otherwise than as described in or contemplated
by the Prospectus, the effect
<PAGE>
20
of which, in any such case described in clause (i) or (ii), is, in the
judgment of the Representative, so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Underwritten Shares on the terms and in the manner
contemplated in the Prospectus.
(l) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange or the American
Stock Exchange or in the over-the-counter market, or trading in any
securities of the Company on any exchange or in the over-the-counter
market, shall have been suspended or minimum prices shall have been
established on any such exchange or such market by the Commission, by
such exchange or by any other regulatory body or governmental authority
having jurisdiction, (ii) a banking moratorium shall have been declared
by federal or state authorities, (iii) the United States shall have
become engaged in hostilities, there shall have been an escalation in
hostilities involving the United States or there shall have been a
declaration of a national emergency or war by the United States or (iv)
there shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of
international conditions on the financial markets in the United States
shall be such) as to make it, in the judgment of a majority in interest
of the several Underwriters, impracticable or inadvisable to proceed
with the public offering or delivery of the Underwritten Shares
Securities on the terms and in the manner contemplated in the
Prospectus.
All opinions, letters, evidence and certificates mentioned above
or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance
satisfactory to counsel for the Underwriters.
10. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the Company shall fail
to tender the Underwritten Shares for delivery to the Underwriters for any
reason permitted under this Agreement, or if the Underwriters shall decline to
purchase the Underwritten Shares for any reason permitted under this Agreement
(other than pursuant to Paragraph 4 hereof), the Company shall reimburse the
Underwriters for reasonable fees and expenses of their counsel and for such
other out-of-pocket expenses as shall have been incurred by them in connection
with this Agreement and the proposed purchase of Underwritten Shares and the
solicitation of any purchases of the Underwritten Shares, and upon demand the
Company shall pay the full amount thereof to the Representative. If this
Agreement is terminated pursuant to Paragraph 4 hereof by reason of the default
of one or more Underwriters, the Company shall not be obligated to reimburse any
defaulting Underwriter on account of those expenses.
11. NOTICES, ETC. The Company shall be entitled to act and rely upon
any request, consent, notice or agreement by, or on behalf of, the
Representative. Any notice by the Company to the Underwriters shall be
sufficient if given in writing or by telegraph addressed to the Representative
at its address set forth in Schedule I hereto, and any notice by the
<PAGE>
21
Underwriters to the Company shall be sufficient if given in writing or by
facsimile addressed to the Company at 784 Memorial Drive, Cambridge,
Massachusetts 02139 (Facsimile Number: (781) 386-3228), Attention of the
Treasurer.
12. PERSONS ENTITLED TO THE BENEFIT OF THIS AGREEMENT. This Agreement
shall be binding upon the Underwriters, the Company, and their respective
successors. This Agreement and the terms and provisions hereof are for the sole
benefit of only those persons, except that (a) the representations, warranties,
indemnities and agreements of the Company contained in this Agreement shall also
be deemed to be for the benefit of the person or persons, if any, who control
any Underwriter within the meaning of Section 15 of the Act, and (b) the
indemnity agreement of the Underwriters contained in Paragraph 7 hereof shall be
deemed to be for the benefit of directors of the Company, officers of the
Company who have signed any Registration Statement and any person controlling
the Company. Nothing in this Agreement is intended or shall be construed to give
any person, other than the persons referred to in this Paragraph, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
13. CERTAIN DEFINITIONS. For purposes of this Agreement, (a) "business
day" means any day on which the New York Stock Exchange, Inc. is open for
trading and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
14. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
15. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
16. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
[THE REST OF THIS PAGE IS LEFT BLANK INTENTIONALLY; THE SIGNATURE PAGE FOLLOWS.]
<PAGE>
22
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this Agreement shall represent a binding agreement among the Company and the
several Underwriters.
Very truly yours,
POLAROID CORPORATION
By
-----------------------------
Name:
Title:
The foregoing Agreement is hereby confirmed
and accepted as of the date first above
written.
[ ]
By
----------------------------------
Name:
Title:
For itself and as Representative of the other
Underwriters named in Schedule II to the foregoing
Agreement.
<PAGE>
SCHEDULE I
Underwriting Agreement dated , 1999.
Registration Statement No's. 333- and 333- .
Representatives and Addresses:
Title:
Number of Underwritten Shares:
Price per share:
Price to public:
Time of payment of dividends:
Stock Exchange Listing:
Delivery Date, Time and Location:
<PAGE>
SCHEDULE II
<TABLE>
<CAPTION>
NUMBER OF
UNDERWRITTEN
NAME OF UNDERWRITER SHARES
- ----------------------------------------------------------------------
<S> <C>
............................................ $
............................................
----
Total $
----
----
</TABLE>
<PAGE>
Exhibit 1.3
POLAROID CORPORATION
[CONVERTIBLE] PREFERRED STOCK
FORM OF UNDERWRITING AGREEMENT
New York, New York
, 1999
To the Representatives
named in Schedule I
hereto of the Underwriters
named in Schedule II hereto
Dear Sirs:
Polaroid Corporation, a Delaware corporation (the "Company"), may issue
and sell from time to time series of its [convertible] preferred stock, par
value $1.00 per share, registered under the registration statement[s] referred
to in Paragraph 1(a) hereof (the "Securities" and, individually, a "Security").
[The shares of the Securities are convertible into shares of the common stock,
par value $1.00 per share of the Company (the "Common Stock"), upon the terms
and subject to the conditions and adjustments set forth in the Certificate of
Designations, Powers, Preferences and Rights (the "Certificate of Designations")
relating thereto, at the conversion price set forth on Schedule I hereto.] The
Company proposes to sell to the underwriters named in Schedule II hereto (the
"Underwriters"), for whom you are acting as representatives (the
"Representative"), a series of Securities, of the designation, with the terms
and in the number of shares specified in Schedule I hereto (the "Underwritten
Shares" and, individually, an "Underwritten Share"). If the firm or firms listed
in Schedule II hereto include only the firm or firms listed in Schedule I
hereto, then the terms "Underwriters" and "Representative" shall each be deemed
to refer to such firm or firms.
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY. The
Company represents, warrants and agrees that:
(a) [A] [R]egistration statement[s] (No[s]. 333- and 333- ),
including a prospectus, with respect to the Securities has [have] been
prepared by the Company in conformity with the requirements of the
Securities Act of 1933, as amended (the "Act"), and the rules and
regulations (the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder and has [have] become
effective. As used in this Agreement, (i) "Registration Statement"
means [each] such registration statement, as amended and supplemented
to the date hereof [, and "Registration Statements" means both such
registration statements, as amended and supplemented, to the date
hereof]; (ii) "Preliminary Prospectus" means each prospectus (including
all documents incorporated therein by reference) included in that [the
most recently filed]
<PAGE>
2
Registration Statement, or amendments or supplements thereof, before it
became effective under the Act, including any prospectus filed with the
Commission pursuant to Rule 424(a) of the Rules and Regulations; (iii)
"Basic Prospectus" means the prospectus included in the [most recently
filed] Registration Statement; and (iv) "Prospectus" means the Basic
Prospectus, together with any prospectus amendment or supplement
(including in each case all documents incorporated therein by
reference) specifically relating to the Underwritten Shares, as filed
with the Commission pursuant to paragraph (b) of Rule 424 of the Rules
and Regulations. The Commission has not issued any order preventing or
suspending the use of any Prospectus, and no proceedings for such
purposes have been instituted or are pending or, to the knowledge of
the Company, are contemplated by the Commission, and any request on the
part of the Commission for additional information has been complied
with.
(b) The Registration Statements and each Prospectus contain, and
(in the case of any amendment or supplement to any such document, or
any material incorporated by reference in any such document, filed with
the Commission after the date as of which this representation is being
made) will contain at all times during the period specified in
Paragraph 6(c) hereof, all statements which are required by the Act,
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and the rules and regulations of the Commission under such Acts; and
the Registration Statements and each Prospectus do not, and (in the
case of any amendment or supplement to any such document, or any
material incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will not, at any time during the period specified in Paragraph
6(c) hereof, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading; PROVIDED that the Company
makes no representation or warranty as to information contained in or
omitted from any Registration Statement or any Prospectus in reliance
and based upon information furnished to the Company through the
Representative by or on behalf of any Underwriter.
(c) Neither the Company nor the Significant Subsidiary (as defined
in paragraph (h) hereof) is in violation of its charter or by-laws or
in default under any agreement, indenture or instrument, except for
such defaults that would not result in a material adverse change, or
any development involving a material adverse change, in or affecting
the general affairs, management, financial position, stockholders'
equity or results of operations of the Company and the Significant
Subsidiary (a "Material Adverse Effect"), otherwise than as set forth
or contemplated in the Prospectus; and the execution, delivery and
performance of this Agreement and the consummation of the transactions
contemplated herein, and in the Prospectus (including the issuance and
sale of the Underwritten Shares and the use of the proceeds from the
sale thereof as described in the Prospectus under the caption "Use of
Proceeds") have been duly authorized by all necessary corporate action
and do not and will not conflict with or constitute a breach of,
<PAGE>
3
or default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or the
Significant Subsidiary pursuant to, any material agreement, indenture
or instrument to which the Company or the Significant Subsidiary is a
party or by which any of them is bound or to which any of their
respective properties or assets is subject, nor will such action result
in a material violation of the charter or by-laws of the Company or the
Significant Subsidiary or any order, rule or regulation of any court or
governmental agency having jurisdiction over the Company, the
Significant Subsidiary or their respective properties; and except as
required by the Act, the Exchange Act and applicable state securities
laws, no consent, authorization or order of, or filing or registration
with, any court or governmental agency is required for the execution,
delivery and performance of this Agreement or the consummation of the
transactions contemplated hereby and thereby.
(d) Except as described in or contemplated by the Registration
Statements and the Prospectus, neither the Company nor any of its
subsidiaries has sustained any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree; and there has not been any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, except as described in
or contemplated by the Prospectus.
(e) KPMG Peat Marwick LLP ("KPMG"), whose report appears in the
Company's most recent Annual Report on Form 10-K which is incorporated
by reference in each Prospectus, are independent accountants as
required by the Act and the Rules and Regulations.
(f) On the Delivery Date (as defined in Paragraph 5 hereof), the
Underwritten Shares (i) will have been duly and validly authorized,
(ii) will be, when issued and delivered against payment therefor, as
provided in this Agreement, validly issued, fully paid and
non-assessable and (iii) will conform to the description thereof
contained in the Prospectus.
(g) The Company has an authorized capitalization as set forth in
the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully
paid and non-assessable and conform to the description thereof
contained in the Prospectus.
[(h) All of the shares of Common Stock issuable upon conversion of
the Underwritten Shares have been duly and validly authorized and
reserved for issuance upon such conversion and, when issued and
delivered in accordance with the terms of the
<PAGE>
4
Certificate of Designations, will be duly and validly issued, fully
paid and non-assessable; and the Common Stock issuable upon conversion
of the Underwritten Shares will conform to the description thereof
contained in the Prospectus.]
(i) This Agreement has been validly authorized, executed and
delivered by the Company.
(j) The Company and the Significant Subsidiary have been duly
incorporated and are validly existing and remain subsisting
corporations under the laws of their respective jurisdictions of
incorporation, are duly qualified to do business and in good standing
as foreign corporations in each jurisdiction in which their respective
ownership of properties or the conduct of their respective businesses
require such qualification, except where the failure to so qualify
would not have a Material Adverse Effect, and have power and authority
necessary to own or hold their respective properties and to conduct the
businesses in which they are engaged and, with respect to the Company,
to enter into and perform its obligations under this Agreement; and
none of the subsidiaries of the Company (other than Polaroid
International B.V. (the "Significant Subsidiary")) is a "significant
subsidiary," as such term is defined in Rule 405 of the Rules and
Regulations.
(k) There is no material action, suit or proceeding before any
court or governmental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, threatened, against or affecting
the Company or the Significant Subsidiary, which is required to be
disclosed in any Prospectus (other than as disclosed therein), or which
might reasonably be expected to have a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the
transactions contemplated in this Agreement or the performance by the
Company of its obligations hereunder.
(l) The financial statements filed as part of the Registration
Statements or included in any Preliminary Prospectus present, or (in
the case of any amendment or supplement to any such document, or any
material incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will present at all times during the period specified in
Paragraph 6(c) hereof, fairly, the financial condition and results of
operations of the Company and its consolidated subsidiaries, at the
dates and for the periods indicated, and have been, and (in the case of
any amendment or supplement to any such document, or any material
incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will be at all times during the period specified in Paragraph
6(c) hereof, prepared in conformity with generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout the
periods involved. The supporting schedules incorporated by reference in
any Prospectus present fairly in accordance with
<PAGE>
5
GAAP the information required to be stated therein. The pro forma
financial statements and the related notes thereto incorporated by
reference in the Registration Statements and any Prospectus present
fairly the information shown therein, have been prepared in accordance
with the Commission's rules and guidelines with respect to pro forma
financial statements and have been properly compiled on the bases
described therein, and the assumptions used in the preparation thereof
are reasonable and the adjustments used therein are appropriate to give
effect to the transactions and circumstances referred to therein.
(m) The documents incorporated by reference into any Preliminary
Prospectus or Prospectus have been, and (in the case of any amendment
or supplement to any such document, or any material incorporated by
reference in any such document, filed with the Commission after the
date as of which this representation is being made) will be at all
times during the period specified in Paragraph 6(c) hereof, prepared by
the Company in conformity with the applicable requirements of the Act
and Rules and Regulations and the Exchange Act and the rules and
regulations of the Commission thereunder and such documents have been,
or (in the case of any amendment or supplement to any such document, or
any material incorporated by reference in any such document, filed with
the Commission after the date as of which this representation is being
made) will be at all times during the period specified in Paragraph
6(c) hereof, timely filed as required thereby.
(n) There are no contracts or other documents which are required
to be filed as exhibits to the Registration Statements by the Act or by
the Rules and Regulations, or which were required to be filed as
exhibits to any document incorporated by reference in any Prospectus by
the Exchange Act or the rules and regulations of the Commission
thereunder, which have not been filed as exhibits to the Registration
Statements or to such document or incorporated therein by reference as
permitted by the Rules and Regulations or the rules and regulations of
the Commission under the Exchange Act as required.
(o) The Company and the Significant Subsidiary have good and valid
title to all or substantially all of their respective properties.
(p) The Company is not, and upon the issuance and sale of the
Underwritten Shares as herein contemplated and the application of the
net proceeds therefrom as described in the Prospectus will not be, an
"investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the Investment Company Act of
1940, as amended (the "1940 Act").
2. PURCHASE OF THE SECURITIES BY THE UNDERWRITERS. Subject to the terms
and conditions and in reliance upon the representations and warranties herein
set forth, the Company agrees to
<PAGE>
6
sell to each Underwriter, severally and not jointly, and each Underwriter
agrees, severally and not jointly, to purchase from the Company, at the purchase
price and on the other terms set forth in Schedule I hereto, the number of
Underwritten Shares set forth opposite its name in Schedule II hereto.
3. CONDITIONS OF THE COMPANY'S OBLIGATIONS. The Company shall not be
obligated to deliver any Underwritten Shares except upon payment for all
Underwritten Shares to be purchased pursuant to this Agreement as hereinafter
provided.
4. DEFAULTING UNDERWRITERS. If any Underwriter defaults in the
performance of its obligations under this Agreement, the remaining
non-defaulting Underwriters, if any, shall be obligated to purchase the
Underwritten Shares which the defaulting Underwriter agreed but failed to
purchase in the respective proportions which the number of Underwritten Shares
set forth in Schedule II hereto to be purchased by each remaining non-defaulting
Underwriter set forth therein bears to the aggregate number of Underwritten
Shares set forth therein to be purchased by all the remaining non-defaulting
Underwriters; PROVIDED that the remaining non-defaulting Underwriters shall not
be obligated to purchase any Underwritten Shares if the aggregate number of
Delivery Underwritten Shares which the defaulting Underwriter or Underwriters
agreed but failed to purchase exceeds 9.09% of the total number of Underwritten
Shares, and any remaining non-defaulting Underwriter shall not be obligated to
purchase more than 110% of the number of Underwritten Shares set forth in
Schedule II hereto to be purchased by it. If the foregoing maximums are
exceeded, the remaining non-defaulting Underwriters, or those other underwriters
satisfactory to the Representative who so agree, shall have the right, but shall
not be obligated, to purchase, in such proportion as may be agreed upon among
them, all the Underwritten Shares. If the remaining Underwriters or other
underwriters satisfactory to the Representative do not elect to purchase the
Underwritten Shares which the defaulting Underwriter or Underwriters agreed but
failed to purchase, this Agreement shall terminate without liability on the part
of any non-defaulting Underwriter or the Company, except that the Company will
continue to be liable for the payment of expenses as set forth in Paragraph 6(k)
hereof.
Nothing contained in this Paragraph 4 shall relieve a defaulting
Underwriter of any liability it may have to the Company for damages caused by
its default. If other underwriters are obligated or agree to purchase the
Underwritten Shares of a defaulting or withdrawing Underwriter, either the
Representative or the Company may postpone the Delivery Date for up to seven
full business days in order to effect any changes that in the opinion of counsel
for the Company or counsel for the Underwriters may be necessary in the
Registration Statements, any Prospectus or in any other document or arrangement.
5. DELIVERY AND PAYMENT FOR THE SECURITIES. Delivery of and payment for
the Underwritten Shares shall be made at such address, date and time as may be
specified in Schedule I hereto. This date and time are sometimes referred to as
the "Delivery Date." On the Delivery Date, the Company shall deliver the
Underwritten Shares to the Representative, for the
<PAGE>
7
account of each Underwriter against payment to the Company by wire transfer of
immediately available funds to a bank account designated by the Company. Time
shall be of the essence, and delivery at the time and place specified pursuant
to this Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Underwritten Shares shall be in registered form
and in such denominations as may be set forth on Schedule I hereto. The
certificates representing the Underwritten Shares shall be made available for
inspection by the Representative in New York, New York not later than 2:00 P.M.,
local time, on the business day prior to the Delivery Date.
6. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees:
(a) To furnish promptly to the Representative and to counsel for
the Underwriters a conformed copy of each Registration Statement as
originally filed and each amendment or supplement thereto filed prior
to the date hereof or relating to or covering the Underwritten Shares,
and a copy of each Prospectus filed with the Commission, including all
documents incorporated therein by reference and all consents and
exhibits filed therewith;
(b) To deliver promptly to the Representative such reasonable
number of the following documents as the Representative may request:
(i) conformed copies of the Registration Statements (excluding exhibits
other than the computation of the ratio of earnings to combined fixed
charges including preference dividends and this Agreement), (ii) each
Prospectus and (iii) any documents incorporated by reference in the
Prospectus;
(c) During such period following the date hereof as, in the
opinion of counsel for the Underwriters, any Prospectus is required by
law to be delivered, to comply with the Act, the Exchange Act and the
rules and regulations under each thereof, so as to permit the
completion of the distribution of the Underwritten Shares as
contemplated in this Agreement and in each Prospectus. If at any time
when a prospectus is required by the Act to be delivered in connection
with sales of the Underwritten Shares, any event shall occur or
condition shall exist as a result of which it is necessary, in the
reasonable opinion of counsel for the Underwriters or for the Company,
to amend any Registration Statement or amend or supplement any
Prospectus in order that such Prospectus will not include any untrue
statements of a material fact or omit to state a material fact
necessary in order to make the statements therein not misleading in the
light of the circumstances existing at the time it is delivered to a
purchaser, or if it shall be necessary, in the opinion of such counsel,
at any such time to amend any Registration Statement or amend or
supplement any Prospectus in order to comply with the requirements of
the Act or the Rules and Regulations, the Company will promptly prepare
and file with the Commission, subject to paragraph (d) below, such
amendment or supplement as may be necessary to correct such statement
or omission or to make any such Registration Statement or any such
Prospectus comply with such requirements, and the Company will
<PAGE>
8
furnish to the Underwriters such number of copies of such amendment or
supplement as the Underwriters may reasonably request;
(d) Prior to filing with the Commission during the period referred
to in (c) above (i) any amendment or supplement to any Registration
Statement, (ii) any Prospectus or any amendment or supplement thereto
or (iii) any document incorporated by reference in any of the foregoing
or any amendment or supplement to such incorporated document, to
furnish a copy thereof to the Representative and to counsel for the
Underwriters and not to file any document that shall have been
disapproved by the Representative;
(e) To advise the Representative promptly (i) when any
post-effective amendment to any Registration Statement relating to or
covering the Underwritten Shares becomes effective or any supplement to
any Prospectus shall have been filed, (ii) of any comments from the
Commission or any request or proposed request by the Commission for an
amendment or supplement to any Registration Statement (insofar as the
amendment or supplement relates to or covers the Underwritten Shares),
to any Prospectus, to any document incorporated by reference in any of
the foregoing or for any additional information, (iii) of the issuance
by the Commission of any stop order suspending the effectiveness of any
Registration Statement or any order directed to any Prospectus or any
document incorporated therein by reference or the initiation or threat
of any stop order proceeding or of any challenge to the accuracy or
adequacy of any document incorporated by reference in any Prospectus,
(iv) of receipt by the Company of any notification with respect to the
suspension of the qualification of the Underwritten Shares for sale in
any jurisdiction or the initiation or threat of any proceeding for that
purpose and (v) of the happening of any event which makes untrue any
statement of a material fact made in any Registration Statement
(insofar as such Registration Statement relates to or covers the
Underwritten Shares) or any Prospectus or which requires the making of
a change in any Registration Statement or any Prospectus in order to
make any material statement therein not misleading;
(f) If, during the period referred to in (c) above, the Commission
shall issue a stop order suspending the effectiveness of any
Registration Statement, to make every reasonable effort to obtain the
lifting of that order at the earliest possible time;
(g) As soon as practicable, to make generally available to its
security holders and to deliver to the Representative an earnings
statement, conforming with the requirements of Section 11(a) of the
Act, covering a period of at least twelve months beginning after the
latest of (i) the most recent effective date of the registration
statement relating to part of the Underwritten Shares, (ii) the
effective date of the most recent post-effective amendment to the last
Registration Statement that became effective prior to the date of this
Agreement and (iii) the date of the Company's most recent Annual Report
on Form 10-K filed with the Commission prior to the date of this
Agreement;
<PAGE>
9
(h) So long as any of the Underwritten Shares are outstanding, to
furnish to the Representative copies of all reports and financial
statements furnished by the Company to each securities exchange on
which securities issued by the Company may be listed pursuant to
requirements of or agreements with such exchange or to the Commission
pursuant to the Exchange Act or any rule or regulation of the
Commission thereunder;
(i) To endeavor to qualify the Underwritten Shares for offer and
sale under the securities laws of such jurisdictions as the
Representative may reasonably request and to maintain such
qualifications in effect for as long as may be required for the
distribution of the Underwritten Shares; PROVIDED, HOWEVER, that the
Company shall not be obligated to file any general consent to service
of process or to qualify as a foreign corporation or as a dealer in
securities in any jurisdiction in which it is not so qualified or to
subject itself to taxation in respect of doing business in any
jurisdiction in which it is not otherwise so subject;
(j) To use its best efforts to obtain the listing of the
Underwritten Shares [and the Common Stock issuable upon conversion of
the Underwritten Shares] on the securities exchange, if any, set forth
on Schedule I (the "Stock Exchange") on or prior to the Delivery Date
[, or prior to the initial issuance of such Common Stock,] and to cause
such listing to be continued so long as any amount of the Securities
[or the Common Stock, issued upon conversion of the Underwritten
Shares,] remain outstanding; to furnish from time to time any and all
documents, instruments, information and undertakings that may be
necessary in order to effect such listing; and to maintain the same
until none of the Underwritten Shares [or the Common Stock issued upon
conversion of the Underwritten Shares] is outstanding; PROVIDED that if
the Company can no longer reasonably maintain such listing, the Company
shall use its best efforts to obtain and maintain the quotation for, or
listing of, the Underwritten Shares [and the Common Stock issued upon
conversion of the Underwritten Shares], on such other securities
exchange or exchanges as the Company may, with the approval of the
Representative, determine;
(k) To pay the costs incident to the authorization, issuance, sale
and delivery of the Underwritten Shares and any taxes payable in that
connection; the costs incident to the preparation, printing and filing
under the Act of the Registration Statements and any amendments,
supplements and exhibits thereto; the costs incident to the
preparation, printing and filing of any document and any amendments and
exhibits thereto required to be filed by the Company under the Exchange
Act; the costs of distributing the Registration Statements as
originally filed and each amendment and post-effective amendment
thereof (including exhibits), any Preliminary Prospectus, each
Prospectus and any documents incorporated by reference in any of the
foregoing documents; the costs of printing this Agreement; the fees and
disbursements of the Company's counsel, accountants and other advisors;
[the fees of the Transfer Agent and Registrar, if any, relating to the
Common Stock issuable upon conversion of the Underwritten Shares]; the
<PAGE>
10
costs of any filings with the National Association of Securities
Dealers, Inc.; fees paid to rating agencies, if any, in connection with
the rating of the Securities, including the Underwritten Shares; the
fees and expenses of qualifying the Underwritten Shares under the
securities laws of the several jurisdictions as provided in this
paragraph and of preparing and printing a Blue Sky Memorandum and the
costs of advising on the legality of the Securities [and the Common
Stock issuable upon conversion of the Underwritten Shares] for
investment (including fees of counsel to the Underwriters); the cost of
listing the Underwritten Shares [and the Common Stock issuable upon
conversion of the Underwritten Shares] on the Stock Exchange; and all
other costs and expenses incident to the performance of the Company's
obligations under this Agreement; PROVIDED that, except as provided in
this paragraph and in Paragraph 10 hereof, the Underwriters shall pay
their own costs and expenses, including the fees and expenses of their
counsel, any transfer taxes on the Underwritten Shares which they may
sell and the expenses of advertising any offering of the Underwritten
Shares made by the Underwriters;
(l) Until the termination of the offering of the Underwritten
Shares, to timely file all documents, and any amendments to previously
filed documents, required to be filed by the Company pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act; and
(m) During the period beginning on the date hereof and continuing
to the Delivery Date, without the consent of the Representative, not to
offer, sell, contract to sell or otherwise dispose of any debt
securities of the Company with maturities longer than one year, other
than the Underwritten Shares to the Underwriters.
7. INDEMNIFICATION AND CONTRIBUTION. (a) The Company shall indemnify
and hold harmless each Underwriter, its officers and employees and each person,
if any, who controls any Underwriter within the meaning of the Act, from and
against any loss, claim, damage or liability, joint or several, or any action in
respect thereof (including, but not limited to, any loss, claim, damage,
liability or action relating to purchases and sales of Securities), to which
that Underwriter, officer, employee or controlling person may become subject,
under the Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon, (i) any untrue statement or alleged
untrue statement of a material fact contained (A) in any Preliminary Prospectus,
the Registration Statement or the Prospectus, or in any amendment or supplement
thereto, or (B) in any blue sky application or other document prepared or
executed by the Company (or based upon any written information furnished by the
Company) specifically for the purpose of qualifying any or all of the Securities
[or the Common Stock issuable upon conversion of the Underwritten Shares] under
the securities laws of any state or other jurisdiction (any such application,
document or information being hereinafter called a "Blue Sky Application"), or
(ii) the omission or alleged omission to state in any Preliminary Prospectus,
the Registration Statement or the Prospectus, or in any amendment or supplement
thereto, or in any Blue Sky Application any material fact required to be stated
therein or necessary to make the statements therein not misleading, and shall
reimburse each Underwriter and each such officer,
<PAGE>
11
employee and controlling person promptly upon demand for any legal or other
expenses reasonably incurred by that Underwriter, officer, employee or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred; PROVIDED, HOWEVER, that the Company shall not be liable
in any such case to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in any Preliminary Prospectus,
the Registration Statement or the Prospectus, or in any such amendment or
supplement, or in any Blue Sky Application in reliance upon and in conformity
with the written information furnished to the Company through the Representative
by or on behalf of any Underwriter specifically for inclusion therein and
described in Paragraph 7(e); and PROVIDED FURTHER that as to any Preliminary
Prospectus this indemnity agreement shall not inure to the benefit of any
Underwriter, its officers or employees or any person controlling that
Underwriter on account of any loss, claim, damage, liability or action arising
from the sale of Securities to any person by that Underwriter if that
Underwriter failed to send or give a copy of the Prospectus, as the same may be
amended or supplemented, to that person within the time required by the Act, and
the untrue statement or alleged untrue statement of any material fact or
omission or alleged omission to state a material fact in such Preliminary
Prospectus was corrected in the Prospectus, unless such failure resulted from
non-compliance by the Company with Paragraph 6(c). For purposes of the last
proviso to the immediately preceding sentence, the term "Prospectus" shall not
be deemed to include the documents incorporated therein by reference, and no
Underwriter shall be obligated to send or give any supplement or amendment to
any document incorporated by reference in any Preliminary Prospectus or the
Prospectus to any person other than a person to whom such Underwriter had
delivered such incorporated document or documents in response to a written
request therefor. The foregoing indemnity agreement is in addition to any
liability which the Company may otherwise have to any Underwriter or to any
officer, employee or controlling person of that Underwriter.
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company, its officers and employees, each of its directors and
each person, if any, who controls the Company within the meaning of the Act,
from and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which the Company or any such director, officer or
controlling person may become subject, under the Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or in any amendment or supplement thereto, or (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, or in any Blue Sky Application any material fact required to
be stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with the written information furnished to the Company through the
Representative by or on behalf of that Underwriter specifically for inclusion
therein
<PAGE>
12
and described in Paragraph 7(e), and shall reimburse the Company and any such
director, officer or controlling person for any legal or other expenses
reasonably incurred by the Company or any such director, officer or controlling
person in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action as such expenses are
incurred. The foregoing indemnity agreement is in addition to any liability
which any Underwriter may otherwise have to the Company or any such director,
officer or controlling person.
(c) Promptly after receipt by an indemnified party under this Paragraph
7 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Paragraph 7, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Paragraph 7 except to the extent it has
been materially prejudiced by such failure and, PROVIDED FURTHER, that the
failure to notify the indemnifying party shall not relieve it from any liability
which it may have to an indemnified party otherwise than under this Paragraph 7.
If any such claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly with
any other similarly notified indemnifying party, to assume the defense thereof
with counsel satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Paragraph 7 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; PROVIDED, HOWEVER, that
any indemnified party shall have the right to employ separate counsel in any
such action and to participate in the defense thereof but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless (i) the
employment thereof has been specifically authorized by the indemnifying party in
writing, (ii) such indemnified party shall have been advised by such counsel
that there may be one or more legal defenses available to it which are different
from or additional to those available to the indemnifying party and in the
reasonable judgment of such counsel it is advisable for such indemnified party
to employ separate counsel or (iii) the indemnifying party has failed to assume
the defense of such action and employ counsel reasonably satisfactory to the
indemnified party, in which case, if such indemnified party notifies the
indemnifying party in writing that it elects to employ separate counsel at the
expense of the indemnifying party, the indemnifying party shall not have the
right to assume the defense of such action on behalf of such indemnified party,
it being understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys at any time for all such indemnified
parties, which firm shall be designated in writing by the Representative, if the
indemnified parties under this Paragraph 7 consist of any Underwriter or any of
their respective officers, employees or controlling persons, or by the
<PAGE>
13
Company, if the indemnified parties under this Paragraph consist of the Company
or any of the Company's directors, officers, employees or controlling persons.
No indemnifying party shall (i) without the prior written consent of the
indemnified parties (which consent shall not be unreasonably withheld), settle
or compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding, or (ii) be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with its written consent or if there be a final
judgment of the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss of
liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Paragraph 7 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Paragraph 7(a) or 7(b) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters on the other from
the offering of the Securities or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and the Underwriters on
the other with respect to the statements or omissions which resulted in such
loss, claim, damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriters on the other with respect to such
offering shall be deemed to be in the same proportion as the total net proceeds
from the offering of the Securities purchased under this Agreement (before
deducting expenses) received by the Company, on the one hand, and the total
underwriting discounts and commissions received by the Underwriters with respect
to the shares of the Securities purchased under this Agreement, on the other
hand, bear to the total gross proceeds from the offering of the shares of the
Securities under this Agreement, in each case as set forth in the table on the
cover page of the Prospectus. The relative fault shall be determined by
reference to whether the untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or the Underwriters, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and the Underwriters agree that it would
not be just and equitable if contributions pursuant to this Paragraph 7(d) were
to be determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation which does
not take into account the equitable considerations referred to herein. The
amount paid or payable by an
<PAGE>
14
indemnified party as a result of the loss, claim, damage or liability, or action
in respect thereof, referred to above in this Paragraph 7(d) shall be deemed to
include, for purposes of this Paragraph 7(d), any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Paragraph 7(d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Securities
underwritten by it and distributed to the public was offered to the public
exceeds the amount of any damages which such Underwriter has otherwise paid or
become liable to pay by reason of any untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute as provided in
this Paragraph 7(d) are several in proportion to their respective underwriting
obligations and not joint.
(e) The Underwriters severally confirm that the statements with respect
to the public offering of the Securities set forth on the cover page of, and
under the caption "Underwriting" in, the Prospectus are correct and constitute
the only information furnished in writing to the Company by or on behalf of the
Underwriters specifically for inclusion in the Registration Statement and the
Prospectus.
8. TERMINATION. (a) The obligations of the Underwriters hereunder may
be terminated by the Representative by notice given to and received by the
Company prior to delivery of and payment for the Underwritten Shares if, prior
to that time, any of the events described in Paragraphs 9(k), 9(l) or 9(m)
hereof shall have occurred or if the Underwriters shall decline to purchase the
Underwritten Shares for any reason permitted under this Agreement.
(b) If this Agreement is terminated pursuant to this Paragraph 8, such
termination shall be without liability of any party to any other party except as
provided in Paragraph 10 hereof, and PROVIDED FURTHER that Paragraphs 1 and 7
shall survive such termination and remain in full force and effect.
9. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS . The respective
obligations of the Underwriters under the Agreement with respect to the
Underwritten Shares are subject to the accuracy, on the date hereof and on the
Delivery Date, of the representations and warranties of the Company contained
herein, to performance by the Company of its obligations hereunder, and to each
of the following additional terms and conditions applicable to the Underwritten
Shares.
(a) At or before the Delivery Date, no stop order suspending the
effectiveness of any Registration Statement nor any order directed to
any document incorporated by reference in any Prospectus shall have
been issued and prior to that time no stop order proceeding shall have
been initiated or threatened by the Commission and no challenge shall
have been made to the accuracy or adequacy of any document incorporated
by reference in any
<PAGE>
15
Prospectus; any request of the Commission for inclusion of additional
information in any Registration Statement or any Prospectus or
otherwise shall have been complied with; and after the date hereof the
Company shall not have filed with the Commission any amendment or
supplement to any Registration Statement or any Prospectus (or any
document incorporated by reference therein) that shall have been
disapproved by the Representative.
(b) No Underwriter shall have discovered and disclosed to the
Company on or prior to the Delivery Date that any Registration
Statement or any Prospectus contains an untrue statement of a fact
which, in the opinion of counsel for the Underwriters, is material or
omits to state a fact which, in the opinion of such counsel, is
material and is required to be stated therein or is necessary to make
the statements therein not misleading.
(c) All corporate proceedings and other legal matters incident to
the authorization, form and validity of this Agreement, the
Underwritten Shares and the form of the Registration Statements, each
Prospectus (other than financial statements and other financial data)
and all other legal matters relating to this Agreement and the
transactions contemplated hereby shall be satisfactory in all respects
to counsel for the Underwriters, and the Company shall have furnished
to such counsel all documents and information that such counsel may
reasonably request to enable it to pass upon such matters.
(d) [ ], General Counsel of the Company, shall have furnished
to the Representative his opinion addressed to the Underwriters and
dated the Delivery Date to the effect that:
(i) The Company has been duly incorporated and is validly
existing and remains a subsisting corporation under the laws of
the State of Delaware;
(ii) The Company is duly qualified to do business and is in
good standing as a foreign corporation in all jurisdictions in
which its ownership of property or the conduct of its business
requires such qualification (except where the failure to so
qualify would not have a Material Adverse Effect), and has all
power and authority necessary to own its properties and conduct
the business in which it is engaged as described in the
Prospectus;
(iii) No order issued by the Commission directed to any
document incorporated by reference in any Prospectus has been
issued and, to the knowledge of such counsel, no challenge has
been made by the Commission to the accuracy or adequacy of any
such document;
(iv) The Company has an authorized capitalization as set
forth in the Prospectus, and all of the issued shares of capital
stock of the Company (including the
<PAGE>
16
Underwritten Shares being delivered on the Delivery Date) have
been duly and validly authorized and issued, are fully paid and
non-assessable;
(v) There are no preemptive or other rights to subscribe
for or to purchase, nor any restriction upon the voting or
transfer of, any Underwritten Shares [or the Common Stock issuable
upon the conversion of the Underwritten Shares, in each case]
pursuant to the Certificate of Designations, the Company's Charter
or by-laws or any agreement or other instrument known to such
counsel;
(vi) Such counsel does not know of any litigation or any
governmental proceeding pending or threatened against the Company
which would affect the subject matter of this Agreement or is
required to be disclosed in any Prospectus (including the
documents incorporated by reference therein) which is not
disclosed and correctly summarized therein; and
(vii) The execution, delivery and performance of this
Agreement, the compliance by the Company with the provisions of
the Certificate of Designations and the Underwritten Shares [and
the issuance and delivery of the Common Stock issuable upon
conversion of the Underwritten Shares] will not constitute a
breach of, or result in the creation or imposition of any lien,
charge or encumbrance upon any of the assets of the Company
pursuant to the terms of, or constitute a default under, any
agreement, indenture or instrument known to such counsel, or
result in a violation of the Charter or by-laws of the Company or,
to the best of such counsel's knowledge, any order, rule or
regulation of any court or governmental agency having jurisdiction
over the Company or its property.
In giving such opinion, such counsel need not express any opinion
regarding any order, consent or other authorization or approval which
may be legally required pursuant to any state securities law.
In rendering such opinion, such counsel may: (i) state that his
opinion is limited to matters governed by the federal laws of the
United States of America, the laws of the District of Columbia and the
General Corporation Law of the State of Delaware and that such counsel
is not admitted in the State of Delaware; and (ii) rely (to the extent
such counsel deems proper and specifies in his opinion), as to matters
involving the application of the laws of other jurisdictions upon the
opinion of other counsel of good standing, PROVIDED that such other
counsel is satisfactory to counsel for the Underwriters and furnishes a
copy of its opinion to the Representative.
(e) Boekel de Ner[ie]e, special Netherlands counsel to the
Significant Subsidiary, shall have furnished to the Representative its
opinion addressed to the Underwriters and dated the Delivery Date, to
the effect that the Significant Subsidiary has been duly incorporated
<PAGE>
17
and is validly existing as a private limited liability company under
the laws of The Netherlands and has the corporate power and authority
to carry on the business described in the objects clause of its
Articles of Association.
(f) Simpson Thacher & Bartlett, counsel for the Company, shall
have furnished to the Representative its opinion addressed to the
Underwriters and dated the Delivery Date, to the effect that:
(i) The Company has been duly incorporated and is
validly existing and in good standing as a corporation under the
laws of the State of Delaware;
(ii) The Certificate of Designations has been duly
authorized and executed by the Company and has been filed with the
Secretary of State of the State of Delaware;
(iii) The Underwritten Shares have been duly authorized
by the Company and, upon payment and delivery in accordance with
the Underwriting Agreement, the Underwritten Shares will be
validly issued, fully paid and non-assessable;
[(iv) The Common Stock issuable on the conversion of the
Underwritten Shares has been duly authorized and reserved for
issuance upon such conversion and, when issued and delivered in
accordance with the terms of the Charter and the Certificate of
Designations will be duly and validly issued, fully paid and
non-assessable;]
(v) The statements made in each Prospectus under the
captions "Description of Offered Preferred Stock" [and
"Description of Capital Stock -- Common Stock"] (or [, with
respect to each,] a comparable caption), insofar as they purport
to constitute summaries of the documents referred to therein,
constitute accurate summaries of the terms of such documents in
all material respects;
(vi) Each Registration Statement is effective under the
Act and, to the knowledge of such counsel, no stop order
suspending its effectiveness has been issued and no proceeding for
that purpose is pending or threatened by the Commission;
(vii) This Agreement has been duly authorized, executed
and delivered by the Company; and
(viii) The Company is not an "investment company" or an
entity "controlled" by an "investment company," as such terms are
defined in the 1940 Act.
<PAGE>
18
In rendering such opinion, such counsel may state that its opinion is
limited to matters governed by the federal laws of the United States of America,
the laws of the State of New York and the General Corporation Law of the State
of Delaware and that such counsel is not admitted in the State of Delaware.
Such counsel shall also have furnished to the Representative a written
statement, addressed to the Underwriters and dated the Delivery Date, in form
and substance satisfactory to the Representative, to the effect that (1) such
counsel has acted as counsel to the Company in connection with the preparation
of the Registration Statements and the offer and sale of the Securities
(although the Company is also represented by its General Counsel and, with
respect to certain other matters, by other outside counsel); (2) in the course
of the preparation by the Company of the Registration Statements and the
Prospectus, such counsel participated in conferences with certain officers and
employees of the Company, with representatives of KPMG and with counsel to the
Company; (3) prior to the Company's filing with the Commission documents under
the Exchange Act, such counsel reviewed such documents; and (4) based on (a)
such counsel's examination of the Registration Statements, the Prospectus and
the documents filed by the Company under the Exchange Act, (b) such counsel's
investigation made in connection with the preparation of Registration Statements
and the Prospectus (excluding the documents filed by the Company under the
Exchange Act) and (c) such counsel's participation in the conferences referred
to in clause (2) of this paragraph above, (i) that such counsel is of the
opinion that the Registration Statements, as of their respective effective
dates, and each Prospectus, as of its issue date, complied as to form in all
material respects with the requirements of the Act and the Rules and
Regulations, and each document incorporated by reference in each Prospectus as
filed under the Exchange Act complied as to form when filed in all material
respects with the requirements of the Exchange Act and the applicable rules and
regulations of the Commission thereunder, except that in each case no opinion
need be expressed as to the financial statements and other financial data
contained or incorporated by reference therein, and (ii) such counsel has no
reason to believe that (I) either Registration Statement, on the dates they
became effective (or, with respect to such Registration Statements, if the
Company has filed an Annual Report on Form 10-K since their effective dates, the
date of the Company's most recent Annual Report on Form 10-K), contained any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary in order to make the statements
therein not misleading or that the Prospectus, as of its issue date and as of
the Delivery Date, contains any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading or (II) any document incorporated by reference in the
Prospectus when they were filed with the Commission contained any untrue
statement of a material fact or omitted to state any material fact necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading, except that with respect to each of clauses (I)
and (II) above, such counsel may state that it expresses no belief with respect
to the financial statements or other financial data contained in or incorporated
by reference in the Registration Statements, the Prospectus or documents filed
by the Company
<PAGE>
19
under the Exchange Act. The foregoing opinion and statement may be qualified by
a statement to the effect that such counsel has not independently verified the
accuracy, completeness or fairness of the statements made or included in the
Registration Statements, the Prospectus or the documents filed by the Company
under the Exchange Act and takes no responsibility therefor, except as and to
the extent set forth in paragraph vii above.
(g) The Company shall have furnished to the Representative a
certificate, dated the Delivery Date, of its Chairman of the Board, its
President or a Vice President and its chief financial officer stating
that:
(i) The representations, warranties and agreements of
the Company in Paragraph 1 are true and correct as of the Delivery
Date; the Company has complied with all its agreements contained
herein; and the conditions set forth in Paragraph 9(a) have been
fulfilled;
(ii) (A) Except as described in or contemplated by the
Registration Statements and the Prospectus, neither the Company
nor any of its subsidiaries has sustained, any loss or
interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, or
(B) there has not been any change, or any development involving a
prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as
described in or contemplated by the Prospectus; and
(iii) They have carefully examined the Registration
Statements and the Prospectus and, in their opinion (A) the
Registration Statements, as of their respective effective dates,
and the Prospectus, as of its issue date, did not include any
untrue statement of a material fact and did not omit to state any
material fact required to be stated therein or necessary to make
the statements therein not misleading, and (B) since the effective
date of Registration Statement (No. 333- ), no event has
occurred which should have been set forth in a supplement or
amendment to either of the Registration Statements or the
Prospectus.
(h) (i) Neither the Company nor any of its subsidiaries shall have
sustained, except as described in or contemplated by the Registration
Statements and the Prospectus, any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree, or (ii) there shall not have been
any change, or any development involving a prospective change, in or
affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, otherwise than as set forth or contemplated in the
Prospectus, the effect of which, in any
<PAGE>
20
such case described in clause (i) or (ii), is, in the judgment of the
Representative, so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Securities on the terms and in the manner contemplated in the
Prospectus.
(i) The Company shall have furnished to the Representative (i) a
letter of KPMG, addressed to the Underwriters and dated the date hereof
of the type described in the American Institute of Certified Public
Accountants' Statement on Auditing Standards No. 72 and covering such
specified financial statement items as counsel for the Underwriters may
reasonably have requested and (ii) a letter of KPMG, addressed to the
Underwriters and dated the Delivery Date, stating, as of the date of
such letter (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than five
days prior to the date of such letter), the conclusions and findings of
such firm with respect to the financial information and other matters
covered by its letter referred to in subclause (i) above, confirming in
all material respects the conclusions and findings set forth in such
prior letter.
(j) The Underwritten Shares shall have been accepted for listing
on the Stock Exchange (if any), subject to official notice of issuance.
(k) (i) Neither the Company nor the Significant Subsidiary shall
have sustained, except as described in or contemplated by the
Registration Statements and the Prospectus, any loss or interference
with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court
or governmental action, order or decree, or (ii) there shall not have
been any change, or any development involving a prospective change, in
or affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and the
Significant Subsidiary, otherwise than as described in or contemplated
by the Prospectus, the effect of which, in any such case described in
clause (i) or (ii), is, in the judgment of the Representative, so
material and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Securities on
the terms and in the manner contemplated in the Prospectus.
[(l) Subsequent to the execution and delivery of this Agreement,
(i) no downgrading shall have occurred in the rating accorded the
Company's preferred stock by any "nationally recognized statistical
rating organization," as that term is defined by the Commission for
purposes of Rule 436(g)(2) of the Rules and Regulations and (ii) no
such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating
of any of the Company's preferred stock.
<PAGE>
21
(m) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange or the American
Stock Exchange or in the over-the-counter market, or trading in any
securities of the Company on any exchange or in the over-the-counter
market, shall have been suspended or minimum prices shall have been
established on any such exchange or such market by the Commission, by
such exchange or by any other regulatory body or governmental authority
having jurisdiction, (ii) a banking moratorium shall have been declared
by federal or state authorities, (iii) the United States shall have
become engaged in hostilities, there shall have been an escalation in
hostilities involving the United States or there shall have been a
declaration of a national emergency or war by the United States or (iv)
there shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of
international conditions on the financial markets in the United States
shall be such) as to make it, in the judgment of a majority in interest
of the several Underwriters, impracticable or inadvisable to proceed
with the public offering or delivery of the Securities on the terms and
in the manner contemplated in the Prospectus.
All opinions, letters, evidence and certificates mentioned above
or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance
satisfactory to counsel for the Underwriters.
10. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the Company shall fail
to tender the Underwritten Shares for delivery to the Underwriters for any
reason permitted under this Agreement, or if the Underwriters shall decline to
purchase the Underwritten Shares for any reason permitted under this Agreement
(other than pursuant to Paragraph 4 hereof), the Company shall reimburse the
Underwriters for reasonable fees and expenses of their counsel and for such
other out-of-pocket expenses as shall have been incurred by them in connection
with this Agreement and the proposed purchase of Underwritten Shares and the
solicitation of any purchases of the Underwritten Shares, and upon demand the
Company shall pay the full amount thereof to the Representative. If this
Agreement is terminated pursuant to Paragraph 4 hereof by reason of the default
of one or more Underwriters, the Company shall not be obligated to reimburse any
defaulting Underwriter on account of those expenses.
11. NOTICES, ETC. The Company shall be entitled to act and rely upon
any request, consent, notice or agreement by, or on behalf of, the
Representative. Any notice by the Company to the Underwriters shall be
sufficient if given in writing or by telegraph addressed to the Representative
at its address set forth in Schedule I hereto, and any notice by the
Underwriters to the Company shall be sufficient if given in writing or by
facsimile addressed to the Company at 784 Memorial Drive, Cambridge,
Massachusetts 02139 (Facsimile Number: (781) 386-3228), Attention of the
Treasurer.
<PAGE>
22
12. PERSONS ENTITLED TO THE BENEFIT OF THIS AGREEMENT. This Agreement
shall be binding upon the Underwriters, the Company, and their respective
successors. This Agreement and the terms and provisions hereof are for the sole
benefit of only those persons, except that (a) the representations, warranties,
indemnities and agreements of the Company contained in this Agreement shall also
be deemed to be for the benefit of the person or persons, if any, who control
any Underwriter within the meaning of Section 15 of the Act, and (b) the
indemnity agreement of the Underwriters contained in Paragraph 7 hereof shall be
deemed to be for the benefit of directors of the Company, officers of the
Company who have signed any Registration Statement and any person controlling
the Company. Nothing in this Agreement is intended or shall be construed to give
any person, other than the persons referred to in this Paragraph, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
13. CERTAIN DEFINITIONS. For purposes of this Agreement, (a) "business
day" means any day on which the New York Stock Exchange, Inc. is open for
trading and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
14. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
15. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
16. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
[THE REST OF THIS PAGE IS LEFT BLANK INTENTIONALLY; THE SIGNATURE PAGE FOLLOWS.]
<PAGE>
23
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this Agreement shall represent a binding agreement among the Company and the
several Underwriters.
Very truly yours,
POLAROID CORPORATION
By
----------------------------------
Name:
Title:
The foregoing Agreement is hereby confirmed
and accepted as of the date first above
written.
[ ]
By
------------------------------------------
Name:
Title:
For itself and as Representative of the other
Underwriters named in Schedule II to the foregoing
Agreement.
<PAGE>
SCHEDULE I
Underwriting Agreement dated , 1999.
Registration Statement No's. 333- and 333- .
Representatives and Addresses:
Certificate of Designation, Powers, Preferences and Rights:
Title:
Number of Underwritten Shares:
Price per share:
Price to public:
Time of payment of dividends:
Sinking fund provisions:
[Conversion Price of Common Stock:]
Redemption provisions:
Repayment provisions:
Stock Exchange Listing:
Delivery Date, Time and Location:
<PAGE>
SCHEDULE II
<TABLE>
<CAPTION>
NUMBER OF
UNDERWRITTEN
NAME OF UNDERWRITER SHARES
- ---------------------------------------------------------------------------
<S> <C>
............................................................... $
...............................................................
---
Total $
---
---
</TABLE>
<PAGE>
Exhibit 1.4
POLAROID CORPORATION
[CONVERTIBLE] DEPOSITARY SHARES
FORM OF UNDERWRITING AGREEMENT
New York, New York
, 1999
To the Representatives
named in Schedule I
hereto of the Underwriters
named in Schedule II hereto
Dear Sirs:
Polaroid Corporation, a Delaware corporation (the "Company"), may issue
and sell from time to time series of its [convertible] preferred stock, par
value $1.00 per share, registered under the registration statement[s] referred
to in Paragraph 1(a) hereof (the "Preferred Stock"). [The shares of the
Preferred Stock are convertible into shares of the common stock, par value $1.00
per share of the Company (the "Common Stock"), upon the terms and subject to the
conditions and adjustments set forth in the Certificate of Designations, Powers,
Preferences and Rights (the "Certificate of Designations") relating thereto, at
the conversion price set forth on Schedule I hereto.]. The Company proposes to
sell to the underwriters named in Schedule II hereto (the "Underwriters"), for
whom you are acting as representatives (the "Representative"), the number of
shares of Preferred Stock, of the designation, with the terms and other
provisions specified in Schedule I hereto (the "Underwritten Shares" and,
individually, an "Underwritten Share"). The Underwritten Shares are to be
deposited by you or on your behalf against delivery of depositary receipts (the
"Depositary Receipts") to be issued by ______________, as Depositary (the
"Depositary"), under a deposit agreement, dated as of _____________, 1999 (the
"Deposit Agreement"), by and among the Company, the Depositary and holders from
time to time of the Depositary Receipts issued thereunder. The Depositary
Receipts will evidence depositary shares (the "Depositary Shares"), and each
Depositary Share will represent the fraction of a share of Preferred Stock
identified in Schedule I hereto. The number of Depositary Shares in respect of
Underwritten Shares to be purchased by each Underwriter is identified in
Schedule II hereto. If the firm or firms listed in Schedule II hereto include
only the firm or firms listed in Schedule I hereto, then the terms
"Underwriters" and "Representative" shall each be deemed to refer to such firm
or firms.
1. REPRESENTATIONS, WARRANTIES AND AGREEMENTS OF THE COMPANY. The
Company represents, warrants and agrees that:
(a) [A] [R]egistration statement[s] (No[s]. 333- and 333- ),
including a prospectus, with respect to the Preferred Stock and the
Depositary Shares has [have] been
<PAGE>
2
prepared by the Company in conformity with the requirements of the
Securities Act of 1933, as amended (the "Act"), and the rules and
regulations (the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") thereunder and has [have] become
effective. As used in this Agreement, (i) "Registration Statement"
means [each] such registration statement, as amended and supplemented
to the date hereof, and "Registration Statements" means both such
registration statements, as amended and supplemented to the date
hereof]; (ii) "Preliminary Prospectus" means each prospectus (including
all documents incorporated therein by reference) included in that [the
most recently filed] Registration Statement, or amendments or
supplements thereof, before it became effective under the Act,
including any prospectus filed with the Commission pursuant to Rule
424(a) of the Rules and Regulations; (iii) "Basic Prospectus" means the
prospectus included in the [most recently filed] Registration
Statement; and (iv) "Prospectus" means the Basic Prospectus, together
with any prospectus amendment or supplement (including in each case all
documents incorporated therein by reference) specifically relating to
the Underwritten Shares and the Depositary Shares, as filed with the
Commission pursuant to paragraph (b) of Rule 424 of the Rules and
Regulations. The Commission has not issued any order preventing or
suspending the use of any Prospectus, and no proceedings for such
purposes have been instituted or are pending or, to the knowledge of
the Company, are contemplated by the Commission, and any request on the
part of the Commission for additional information has been complied
with.
(b) The Registration Statements and each Prospectus contain, and
(in the case of any amendment or supplement to any such document, or
any material incorporated by reference in any such document, filed with
the Commission after the date as of which this representation is being
made) will contain at all times during the period specified in
Paragraph 6(c) hereof, all statements which are required by the Act,
the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and the rules and regulations of the Commission under such Acts; and
the Registration Statements and each Prospectus do not, and (in the
case of any amendment or supplement to any such document, or any
material incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will not, at any time during the period specified in Paragraph
6(c) hereof, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to
make the statements therein not misleading; PROVIDED that the Company
makes no representation or warranty as to information contained in or
omitted from any Registration Statement or any Prospectus in reliance
and based upon information furnished to the Company through the
Representative by or on behalf of any Underwriter.
(c) Neither the Company nor the Significant Subsidiary (as defined
in paragraph (h) hereof) is in violation of its charter or by-laws or
in default under any agreement, indenture or instrument, except for
such defaults that would not result in a material adverse change, or
any development involving a material adverse change, in or affecting
<PAGE>
3
the general affairs, management, financial position, stockholders'
equity or results of operations of the Company and the Significant
Subsidiary (a "Material Adverse Effect"), otherwise than as set forth
or contemplated in the Prospectus; and the execution, delivery and
performance of this Agreement and the Deposit Agreement and the
consummation of the transactions contemplated herein, and in the
Prospectus (including the issuance and sale of the Underwritten Shares
and the Depositary Shares and the use of the proceeds from the sale
thereof as described in the Prospectus under the caption "Use of
Proceeds") have been duly authorized by all necessary corporate action
and do not and will not conflict with or constitute a breach of, or
default under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or the
Significant Subsidiary pursuant to, any material agreement, indenture
or instrument to which the Company or the Significant Subsidiary is a
party or by which any of them is bound or to which any of their
respective properties or assets is subject, nor will such action result
in a material violation of the charter or by-laws of the Company or the
Significant Subsidiary or any order, rule or regulation of any court or
governmental agency having jurisdiction over the Company, the
Significant Subsidiary or their respective properties; and except as
required by the Act, the Exchange Act and applicable state securities
laws, no consent, authorization or order of, or filing or registration
with, any court or governmental agency is required for the execution,
delivery and performance of this Agreement, the Deposit Agreement or
the consummation of the transactions contemplated hereby and thereby.
(d) Except as described in or contemplated by the Registration
Statements and the Prospectus, neither the Company nor any of its
subsidiaries has sustained any material loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental action, order or decree; and there has not been any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, except as described in
or contemplated by the Prospectus.
(e) KPMG Peat Marwick LLP ("KPMG"), whose report appears in the
Company's most recent Annual Report on Form 10-K which is incorporated
by reference in each Prospectus, are independent accountants as
required by the Act and the Rules and Regulations.
(f) On the Delivery Date (as defined in Paragraph 5 hereof), the
Underwritten Shares (i) will have been duly and validly authorized,
(ii) will be, when issued and delivered against payment therefor as
provided in this Agreement, validly issued, fully paid and
non-assessable and (iii) will conform to the description thereof
contained in the Prospectus.
<PAGE>
4
(g) The Depositary Shares representing the Underwritten Shares
have been duly and validly authorized by the Company; and, assuming the
due execution by the Depositary of the Deposit Agreement and the due
execution by the Depositary and, if required by the Deposit Agreement,
the registrar (the "Registrar") of the Depositary Receipts in
accordance with the terms of the Deposit Agreement, and upon the
deposit by or on behalf of the Underwriters of the Underwritten Shares
with the Depositary pursuant to the Deposit Agreement, the Depositary
Shares will represent legal and valid interests in the Underwritten
Shares and the Depositary Receipts will constitute valid evidence of
such interests in the Underwritten Shares and will be entitled to the
benefits of the Deposit Agreement.
[(h) All of the shares of Common Stock issuable upon conversion of
the Underwritten Shares have been duly and validly authorized and
reserved for issuance upon such conversion and, when issued and
delivered in accordance with the terms of the Certificate of
Designations, will be duly and validly issued, fully paid and
non-assessable; and the Common Stock issuable upon conversion of the
Underwritten Shares will conform to the description thereof contained
in the Prospectus.]
(i) Each of this Agreement and the Deposit Agreement has been
validly authorized, executed and delivered by the Company.
(j) The Company and the Significant Subsidiary have been duly
incorporated and are validly existing and remain subsisting
corporations under the laws of their respective jurisdictions of
incorporation, are duly qualified to do business and in good standing
as foreign corporations in each jurisdiction in which their respective
ownership of properties or the conduct of their respective businesses
require such qualification, except where the failure to so qualify
would not have a Material Adverse Effect, and have power and authority
necessary to own or hold their respective properties and to conduct the
businesses in which they are engaged and, with respect to the Company,
to enter into and perform its obligations under this Agreement; and
none of the subsidiaries of the Company (other than Polaroid
International B.V. (the "Significant Subsidiary")) is a "significant
subsidiary," as such term is defined in Rule 405 of the Rules and
Regulations.
(k) There is no material action, suit or proceeding before any
court or governmental agency or body, domestic or foreign, now pending,
or, to the knowledge of the Company, threatened, against or affecting
the Company or the Significant Subsidiary, which is required to be
disclosed in any Prospectus (other than as disclosed therein), or which
might reasonably be expected to have a Material Adverse Effect, or
which might reasonably be expected to materially and adversely affect
the properties or assets thereof or the consummation of the
transactions contemplated in this Agreement, the Deposit Agreement or
the performance by the Company of its obligations hereunder.
<PAGE>
5
(l) The financial statements filed as part of the Registration
Statements or included in any Preliminary Prospectus present, or (in
the case of any amendment or supplement to any such document, or any
material incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will present at all times during the period specified in
Paragraph 6(c) hereof, fairly, the financial condition and results of
operations of the Company and its consolidated subsidiaries, at the
dates and for the periods indicated, and have been, and (in the case of
any amendment or supplement to any such document, or any material
incorporated by reference in any such document, filed with the
Commission after the date as of which this representation is being
made) will be at all times during the period specified in Paragraph
6(c) hereof, prepared in conformity with generally accepted accounting
principles ("GAAP") applied on a consistent basis throughout the
periods involved. The supporting schedules incorporated by reference in
any Prospectus present fairly in accordance with GAAP the information
required to be stated therein. The pro forma financial statements and
the related notes thereto incorporated by reference in the Registration
Statements and any Prospectus present fairly the information shown
therein, have been prepared in accordance with the Commission's rules
and guidelines with respect to pro forma financial statements and have
been properly compiled on the bases described therein, and the
assumptions used in the preparation thereof are reasonable and the
adjustments used therein are appropriate to give effect to the
transactions and circumstances referred to therein.
(m) The documents incorporated by reference into any Preliminary
Prospectus or Prospectus have been, and (in the case of any amendment
or supplement to any such document, or any material incorporated by
reference in any such document, filed with the Commission after the
date as of which this representation is being made) will be at all
times during the period specified in Paragraph 6(c) hereof, prepared by
the Company in conformity with the applicable requirements of the Act
and Rules and Regulations and the Exchange Act and the rules and
regulations of the Commission thereunder and such documents have been,
or (in the case of any amendment or supplement to any such document, or
any material incorporated by reference in any such document, filed with
the Commission after the date as of which this representation is being
made) will be at all times during the period specified in Paragraph
6(c) hereof, timely filed as required thereby.
(n) There are no contracts or other documents which are required
to be filed as exhibits to the Registration Statements by the Act or by
the Rules and Regulations, or which were required to be filed as
exhibits to any document incorporated by reference in any Prospectus by
the Exchange Act or the rules and regulations of the Commission
thereunder, which have not been filed as exhibits to the Registration
Statements or to such document or incorporated therein by reference as
permitted by the Rules and
<PAGE>
6
Regulations or the rules and regulations of the Commission under the
Exchange Act as required.
(o) The Company and the Significant Subsidiary have good and valid
title to all or substantially all of their respective properties.
(p) The Company is not, and upon the issuance and sale of the
Underwritten Shares as herein contemplated and the application of the
net proceeds therefrom as described in the Prospectus will not be, an
"investment company" or an entity "controlled" by an "investment
company" as such terms are defined in the Investment Company Act of
1940, as amended (the "1940 Act").
2. PURCHASE OF THE UNDERWRITTEN SHARES BY THE UNDERWRITERS. Subject to
the terms and conditions and in reliance upon the representations and warranties
herein set forth, the Company agrees to sell to each Underwriter, severally and
not jointly, and each Underwriter agrees, severally and not jointly, to purchase
from the Company, at the purchase price and on the other terms set forth in
Schedule I hereto, the number of Depositary Shares in respect of the
Underwritten Shares set forth opposite its name in Schedule II hereto.
3. CONDITIONS OF THE COMPANY'S OBLIGATIONS. The Company shall not be
obligated to deliver any Underwritten Shares except upon payment for all
Underwritten Shares to be purchased pursuant to this Agreement as hereinafter
provided.
4. DEFAULTING UNDERWRITERS. If any Underwriter defaults in the
performance of its obligations under this Agreement, the remaining
non-defaulting Underwriters, if any, shall be obligated to purchase the
Underwritten Shares which the defaulting Underwriter agreed but failed to
purchase in the respective proportions which the number of shares of
Underwritten Shares set forth in Schedule II hereto to be purchased by each
remaining non-defaulting Underwriter set forth therein bears to the aggregate
number of shares of Underwritten Shares set forth therein to be purchased by all
the remaining non-defaulting Underwriters; PROVIDED that the remaining
non-defaulting Underwriters shall not be obligated to purchase any Underwritten
Shares if the aggregate number of shares of Underwritten Shares which the
defaulting Underwriter or Underwriters agreed but failed to purchase exceeds
9.09% of the total number of Underwritten Shares, and any remaining
non-defaulting Underwriter shall not be obligated to purchase more than 110% of
the number of shares of Underwritten Shares set forth in Schedule II hereto to
be purchased by it. If the foregoing maximums are exceeded, the remaining
non-defaulting Underwriters, or those other underwriters satisfactory to the
Representative who so agree, shall have the right, but shall not be obligated,
to purchase, in such proportion as may be agreed upon among them, all the
Underwritten Shares. If the remaining Underwriters or other underwriters
satisfactory to the Representative do not elect to purchase the Underwritten
Shares which the defaulting Underwriter or Underwriters agreed but failed to
purchase, this Agreement shall terminate without liability on the part of any
non-defaulting Underwriter or the Company, except
<PAGE>
7
that the Company will continue to be liable for the payment of expenses as set
forth in Paragraph 6(k) hereof.
Nothing contained in this Paragraph 6 shall relieve a defaulting
Underwriter of any liability it may have to the Company for damages caused by
its default. If other underwriters are obligated or agree to purchase the
Underwritten Shares of a defaulting or withdrawing Underwriter, either the
Representative or the Company may postpone the Delivery Date for up to seven
full business days in order to effect any changes that in the opinion of counsel
for the Company or counsel for the Underwriters may be necessary in the
Registration Statements, any Prospectus or in any other document or arrangement.
5. DELIVERY AND PAYMENT FOR THE UNDERWRITTEN SHARES. Delivery of and
payment for the Underwritten Shares shall be made at such address, date and time
as may be specified in Schedule I hereto. This date and time are sometimes
referred to as the "Delivery Date." On the Delivery Date, the Company shall
deliver the Underwritten Shares to the Representative, for the account of each
Underwriter against payment to the Company by wire transfer of immediately
available funds to a bank account designated by the Company. Time shall be of
the essence, and delivery at the time and place specified pursuant to this
Agreement is a further condition of the obligation of each Underwriter
hereunder. Upon delivery, the Underwritten Shares shall be in registered form
and in such denominations as may be set forth on Schedule I hereto.
The certificates representing the Underwritten Shares will be
delivered by the Representatives to, and deposited with, the Depositary against
delivery of Depositary Receipts representing Depositary Shares issued in respect
of such Underwritten Shares. Such Depositary Receipts shall be issued in such
denominations and registered in such names as the Representatives shall request
and shall be made available for inspection by the Representative in New York,
New York not later than 2:00 P.M., local time, on the business day prior to the
Delivery Date.
6. FURTHER AGREEMENTS OF THE COMPANY. The Company agrees:
(a) To furnish promptly to the Representative and to counsel for
the Underwriters a conformed copy of each Registration Statement as
originally filed and each amendment or supplement thereto filed prior
to the date hereof or relating to or covering the Underwritten Shares
and the Depositary Shares, and a copy of each Prospectus filed with the
Commission, including all documents incorporated therein by reference
and all consents and exhibits filed therewith;
(b) To deliver promptly to the Representative such reasonable
number of the following documents as the Representative may request:
(i) conformed copies of the Registration Statements (excluding exhibits
other than the computation of the ratio of
<PAGE>
8
earnings to combined fixed charges including preference dividends and
this Agreement), (ii) each Prospectus and (iii) any documents
incorporated by reference in the Prospectus;
(c) During such period following the date hereof as, in the
opinion of counsel for the Underwriters, any Prospectus is required by
law to be delivered, to comply with the Act, the Exchange Act and the
rules and regulations under each thereof, so as to permit the
completion of the distribution of the Depositary Shares as contemplated
in this Agreement and in each Prospectus. If at any time when a
prospectus is required by the Act to be delivered in connection with
sales of the Depositary Shares, any event shall occur or condition
shall exist as a result of which it is necessary, in the reasonable
opinion of counsel for the Underwriters or for the Company, to amend
any Registration Statement or amend or supplement any Prospectus in
order that such Prospectus will not include any untrue statements of a
material fact or omit to state a material fact necessary in order to
make the statements therein not misleading in the light of the
circumstances existing at the time it is delivered to a purchaser, or
if it shall be necessary, in the opinion of such counsel, at any such
time to amend any Registration Statement or amend or supplement any
Prospectus in order to comply with the requirements of the Act or the
Rules and Regulations, the Company will promptly prepare and file with
the Commission, subject to paragraph (d) below, such amendment or
supplement as may be necessary to correct such statement or omission or
to make any such Registration Statement or any such Prospectus comply
with such requirements, and the Company will furnish to the
Underwriters such number of copies of such amendment or supplement as
the Underwriters may reasonably request;
(d) Prior to filing with the Commission during the period referred
to in (c) above (i) any amendment or supplement to any Registration
Statement, (ii) any Prospectus or any amendment or supplement thereto
or (iii) any document incorporated by reference in any of the foregoing
or any amendment or supplement to such incorporated document, to
furnish a copy thereof to the Representative and to counsel for the
Underwriters and not to file any document that shall have been
disapproved by the Representative;
(e) To advise the Representative promptly (i) when any
post-effective amendment to any Registration Statement relating to or
covering the Underwritten Shares and the Depositary Shares becomes
effective or any supplement to any Prospectus shall have been filed,
(ii) of any comments from the Commission or any request or proposed
request by the Commission for an amendment or supplement to any
Registration Statement (insofar as the amendment or supplement relates
to or covers the Underwritten Shares), to any Prospectus, to any
document incorporated by reference in any of the foregoing or for any
additional information, (iii) of the issuance by the Commission of any
stop order suspending the effectiveness of any Registration Statement
or any order directed to any Prospectus or any document incorporated
therein by reference or the initiation or threat of any stop order
proceeding or of any challenge to the accuracy or adequacy of any
<PAGE>
9
document incorporated by reference in any Prospectus, (iv) of receipt
by the Company of any notification with respect to the suspension of
the qualification of the Underwritten Shares and the Depositary Shares
for sale in any jurisdiction or the initiation or threat of any
proceeding for that purpose and (v) of the happening of any event which
makes untrue any statement of a material fact made in any Registration
Statement (insofar as such Registration Statement relates to or covers
the Underwritten Shares and the Depositary Shares) or any Prospectus or
which requires the making of a change in any Registration Statement or
any Prospectus in order to make any material statement therein not
misleading;
(f) If, during the period referred to in (c) above, the Commission
shall issue a stop order suspending the effectiveness of any
Registration Statement, to make every reasonable effort to obtain the
lifting of that order at the earliest possible time;
(g) As soon as practicable, to make generally available to its
security holders and to deliver to the Representative an earnings
statement, conforming with the requirements of Section 11(a) of the
Act, covering a period of at least twelve months beginning after the
latest of (i) the most recent effective date of the registration
statement relating to part of the Underwritten Shares and the
Depositary Shares, (ii) the effective date of the most recent
post-effective amendment to the last Registration Statement that became
effective prior to the date of this Agreement and (iii) the date of the
Company's most recent Annual Report on Form 10-K filed with the
Commission prior to the date of this Agreement;
(h) So long as any of the Depositary Shares are outstanding, to
furnish to the Representative copies of all reports and financial
statements furnished by the Company to each securities exchange on
which securities issued by the Company may be listed pursuant to
requirements of or agreements with such exchange or to the Commission
pursuant to the Exchange Act or any rule or regulation of the
Commission thereunder;
(i) To endeavor to qualify the Depositary Shares for offer and
sale under the securities laws of such jurisdictions as the
Representative may reasonably request and to maintain such
qualifications in effect for as long as may be required for the
distribution of the Depositary Shares; PROVIDED, HOWEVER, that the
Company shall not be obligated to file any general consent to service
of process or to qualify as a foreign corporation or as a dealer in
securities in any jurisdiction in which it is not so qualified or to
subject itself to taxation in respect of doing business in any
jurisdiction in which it is not otherwise so subject;
(j) To use its best efforts to obtain the listing of the
Underwritten Shares [, the Common Stock issuable upon conversion of the
Underwritten Shares] and the Depositary Shares on the securities
exchange, if any, set forth on Schedule I (the "Stock Exchange") on or
prior to the Delivery Date [, or prior to the initial issuance of such
Common Stock,]
<PAGE>
10
and to cause such listing to be continued so long as any amount of the
Underwritten Shares [, the Common Stock, issued upon conversion of the
Underwritten Shares] or Depositary Shares remain outstanding; to
furnish from time to time any and all documents, instruments,
information and undertakings that may be necessary in order to effect
such listing; and to maintain the same until none of the Underwritten
Shares [, the Common Stock issued upon conversion of the Underwritten
Shares] or Depositary Shares are outstanding; PROVIDED that if the
Company can no longer reasonably maintain such listing, the Company
shall use its best efforts to obtain and maintain the quotation for, or
listing of, the Underwritten Shares [, the Common Stock issued upon
conversion of the Underwritten Shares] and the Depositary Shares on
such other securities exchange or exchanges as the Company may, with
the approval of the Representative, determine;
(k) To pay the costs incident to the authorization, issuance, sale
and delivery of the Underwritten Shares and any taxes payable in that
connection; the costs incident to the preparation, printing and filing
under the Act of the Registration Statements and any amendments,
supplements and exhibits thereto; the costs incident to the
preparation, printing and filing of any document and any amendments and
exhibits thereto required to be filed by the Company under the Exchange
Act; the costs of distributing the Registration Statements as
originally filed and each amendment and post-effective amendment
thereof (including exhibits), any Preliminary Prospectus, each
Prospectus and any documents incorporated by reference in any of the
foregoing documents; the costs of printing this Agreement; the fees and
disbursements of the Company's counsel, accountants and other advisors;
[the fees of the Transfer Agent and Registrar, if any, relating to the
Common Stock issuable upon conversion of the Underwritten Shares;] the
fees of the Registrar, if required under the Deposit Agreement; all
fees of the Depositary, for all taxes in connection with the deposit of
the Underwritten Shares with the Depositary and the issuance of the
Depositary Receipts as provided in Section 6 hereof; the costs of any
filings with the National Association of Securities Dealers, Inc.; fees
paid to rating agencies in connection with the rating of the
Underwritten Shares or the Depositary Shares; the fees and expenses of
qualifying the Underwritten Shares or the Depositary Shares under the
securities laws of the several jurisdictions as provided in this
paragraph, of preparing and printing a Blue Sky Memorandum and of
advising on the legality of the Underwritten Shares [and the Common
Stock issuable upon conversion of the Underwritten Shares] for
investment (including fees of counsel to the Underwriters); the cost of
listing the Underwritten Shares [, the Common Stock issuable upon
conversion of the Underwritten Shares] or the Depositary Shares on the
Stock Exchange; and all other costs and expenses incident to the
performance of the Company's obligations under this Agreement; PROVIDED
that, except as provided in this paragraph and in Paragraph 10 hereof,
the Underwriters shall pay their own costs and expenses, including the
fees and expenses of their counsel, any transfer taxes on the
Underwritten Shares or the Depositary Shares which they may sell and
the expenses of advertising any offering of the Underwritten Shares
made by the Underwriters;
<PAGE>
11
(l) Until the termination of the offering of the Underwritten
Shares, to timely file all documents, and any amendments to previously
filed documents, required to be filed by the Company pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act; and
(m) During the period beginning on the date hereof and continuing
to _______, without the consent of the Representative, not to offer,
sell, contract to sell or otherwise dispose of any shares of Preferred
Stock of the Company, other than the Underwritten Shares to the
Underwriters.
7. INDEMNIFICATION AND CONTRIBUTION. (a) The Company shall indemnify
and hold harmless each Underwriter, its officers and employees and each person,
if any, who controls any Underwriter within the meaning of the Act, from and
against any loss, claim, damage or liability, joint or several, or any action in
respect thereof (including, but not limited to, any loss, claim, damage,
liability or action relating to purchases and sales of Depositary Shares), to
which that Underwriter, officer, employee or controlling person may become
subject, under the Act or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any untrue statement or
alleged untrue statement of a material fact contained (A) in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, or (B) in any blue sky application or other document
prepared or executed by the Company (or based upon any written information
furnished by the Company) specifically for the purpose of qualifying any or all
of the Underwritten Shares [, the Common Stock issuable upon conversion of the
Underwritten Shares] or Depositary Shares under the securities laws of any state
or other jurisdiction (any such application, document or information being
hereinafter called a "Blue Sky Application"), or (ii) the omission or alleged
omission to state in any Preliminary Prospectus, the Registration Statement or
the Prospectus, or in any amendment or supplement thereto, or in any Blue Sky
Application any material fact required to be stated therein or necessary to make
the statements therein not misleading, and shall reimburse each Underwriter and
each such officer, employee and controlling person promptly upon demand for any
legal or other expenses reasonably incurred by that Underwriter, officer,
employee or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred; PROVIDED, HOWEVER, that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of, or is based upon, any untrue statement or
alleged untrue statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any such
amendment or supplement, or in any Blue Sky Application in reliance upon and in
conformity with the written information furnished to the Company through the
Representative by or on behalf of any Underwriter specifically for inclusion
therein and described in Paragraph 7(e); and PROVIDED FURTHER that as to any
Preliminary Prospectus this indemnity agreement shall not inure to the benefit
of any Underwriter, its officers or employees or any person controlling that
Underwriter on account of any loss, claim, damage, liability or action arising
from the sale of Depositary Shares to any person by that Underwriter if that
Underwriter failed to send or give a copy of the Prospectus, as the same may be
amended or
<PAGE>
12
supplemented, to that person within the time required by the Act, and the untrue
statement or alleged untrue statement of any material fact or omission or
alleged omission to state a material fact in such Preliminary Prospectus was
corrected in the Prospectus, unless such failure resulted from non-compliance by
the Company with Paragraph 6(c). For purposes of the last proviso to the
immediately preceding sentence, the term "Prospectus" shall not be deemed to
include the documents incorporated therein by reference, and no Underwriter
shall be obligated to send or give any supplement or amendment to any document
incorporated by reference in any Preliminary Prospectus or the Prospectus to any
person other than a person to whom such Underwriter had delivered such
incorporated document or documents in response to a written request therefor.
The foregoing indemnity agreement is in addition to any liability which the
Company may otherwise have to any Underwriter or to any officer, employee or
controlling person of that Underwriter.
(b) Each Underwriter, severally and not jointly, shall indemnify and
hold harmless the Company, its officers and employees, each of its directors and
each person, if any, who controls the Company within the meaning of the Act,
from and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which the Company or any such director, officer or
controlling person may become subject, under the Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in any Preliminary Prospectus, the Registration Statement or the
Prospectus, or in any amendment or supplement thereto, or (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state in any Preliminary
Prospectus, the Registration Statement or the Prospectus, or in any amendment or
supplement thereto, or in any Blue Sky Application any material fact required to
be stated therein or necessary to make the statements therein not misleading,
but in each case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with the written information furnished to the Company through the
Representative by or on behalf of that Underwriter specifically for inclusion
therein and described in Paragraph 7(e), and shall reimburse the Company and any
such director, officer or controlling person for any legal or other expenses
reasonably incurred by the Company or any such director, officer or controlling
person in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action as such expenses are
incurred. The foregoing indemnity agreement is in addition to any liability
which any Underwriter may otherwise have to the Company or any such director,
officer or controlling person.
(c) Promptly after receipt by an indemnified party under this Paragraph
7 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Paragraph 7, notify the indemnifying party in
writing of the claim or the commencement of that action; PROVIDED, HOWEVER, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have under this Paragraph 7 except to the extent it has
been materially prejudiced
<PAGE>
13
by such failure and, PROVIDED FURTHER, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Paragraph 7. If any such claim or
action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Paragraph 7 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; PROVIDED, HOWEVER, that
any indemnified party shall have the right to employ separate counsel in any
such action and to participate in the defense thereof but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless (i) the
employment thereof has been specifically authorized by the indemnifying party in
writing, (ii) such indemnified party shall have been advised by such counsel
that there may be one or more legal defenses available to it which are different
from or additional to those available to the indemnifying party and in the
reasonable judgment of such counsel it is advisable for such indemnified party
to employ separate counsel or (iii) the indemnifying party has failed to assume
the defense of such action and employ counsel reasonably satisfactory to the
indemnified party, in which case, if such indemnified party notifies the
indemnifying party in writing that it elects to employ separate counsel at the
expense of the indemnifying party, the indemnifying party shall not have the
right to assume the defense of such action on behalf of such indemnified party,
it being understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys at any time for all such indemnified
parties, which firm shall be designated in writing by the Representative, if the
indemnified parties under this Paragraph 7 consist of any Underwriter or any of
their respective officers, employees or controlling persons, or by the Company,
if the indemnified parties under this Paragraph consist of the Company or any of
the Company's directors, officers, employees or controlling persons. No
indemnifying party shall (i) without the prior written consent of the
indemnified parties (which consent shall not be unreasonably withheld), settle
or compromise or consent to the entry of any judgment with respect to any
pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding, or (ii) be liable for any settlement of any such action
effected without its written consent (which consent shall not be unreasonably
withheld), but if settled with its written consent or if there be a final
judgment of the plaintiff in any such action, the indemnifying party agrees to
indemnify and hold harmless any indemnified party from and against any loss of
liability by reason of such settlement or judgment.
<PAGE>
14
(d) If the indemnification provided for in this Paragraph 7 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Paragraph 7(a) or 7(b) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, then each
indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company on the one hand and the Underwriters on the other from
the offering of the Depositary Shares or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and the
Underwriters on the other with respect to the statements or omissions which
resulted in such loss, claim, damage or liability, or action in respect thereof,
as well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other with
respect to such offering shall be deemed to be in the same proportion as the
total net proceeds from the offering of the Depositary Shares purchased under
this Agreement (before deducting expenses) received by the Company, on the one
hand, and the total underwriting discounts and commissions received by the
Underwriters with respect to the shares of the Depositary Shares purchased under
this Agreement, on the other hand, bear to the total gross proceeds from the
offering of the Depositary Shares under this Agreement, in each case as set
forth in the table on the cover page of the Prospectus. The relative fault shall
be determined by reference to whether the untrue or alleged untrue statement of
a material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company or the Underwriters, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and the Underwriters
agree that it would not be just and equitable if contributions pursuant to this
Paragraph 7(d) were to be determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other method
of allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect thereof,
referred to above in this Paragraph 7(d) shall be deemed to include, for
purposes of this Paragraph 7(d), any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Paragraph 7(d), no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Depositary Shares underwritten by it and
distributed to the public was offered to the public exceeds the amount of any
damages which such Underwriter has otherwise paid or become liable to pay by
reason of any untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriters'
obligations to contribute as provided in this Paragraph 7(d) are several in
proportion to their respective underwriting obligations and not joint.
<PAGE>
15
(e) The Underwriters severally confirm that the statements with respect
to the public offering of the Depositary Shares set forth on the cover page of,
and under the caption "Underwriting" in, the Prospectus are correct and
constitute the only information furnished in writing to the Company by or on
behalf of the Underwriters specifically for inclusion in the Registration
Statement and the Prospectus.
8. TERMINATION. (a) The obligations of the Underwriters hereunder may
be terminated by the Representative by notice given to and received by the
Company prior to delivery of and payment for the Underwritten Shares if, prior
to that time, any of the events described in Paragraphs 9(k), 9(l) or 9(m)
hereof shall have occurred or if the Underwriters shall decline to purchase the
Underwritten Shares for any reason permitted under this Agreement.
(b) If this Agreement is terminated pursuant to this Paragraph 8, such
termination shall be without liability of any party to any other party except as
provided in Paragraph 10 hereof, and PROVIDED further that Paragraphs 1 and 7
shall survive such termination and remain in full force and effect.
9. CONDITIONS OF THE UNDERWRITERS' OBLIGATIONS . The respective
obligations of the Underwriters under the Agreement with respect to the
Underwritten Shares are subject to the accuracy, on the date hereof and on the
Delivery Date, of the representations and warranties of the Company contained
herein, to performance by the Company of its obligations hereunder, and to each
of the following additional terms and conditions applicable to the Underwritten
Shares.
(a) At or before the Delivery Date, no stop order suspending the
effectiveness of any Registration Statement nor any order directed to
any document incorporated by reference in any Prospectus shall have
been issued and prior to that time no stop order proceeding shall have
been initiated or threatened by the Commission and no challenge shall
have been made to the accuracy or adequacy of any document incorporated
by reference in any Prospectus; any request of the Commission for
inclusion of additional information in any Registration Statement or
any Prospectus or otherwise shall have been complied with; and after
the date hereof the Company shall not have filed with the Commission
any amendment or supplement to any Registration Statement or any
Prospectus (or any document incorporated by reference therein) that
shall have been disapproved by the Representative.
(b) No Underwriter shall have discovered and disclosed to the
Company on or prior to the Delivery Date that any Registration
Statement or any Prospectus contains an untrue statement of a fact
which, in the opinion of counsel for the Underwriters, is material or
omits to state a fact which, in the opinion of such counsel, is
material and is required to be stated therein or is necessary to make
the statements therein not misleading.
<PAGE>
16
(c) All corporate proceedings and other legal matters incident to
the authorization, form and validity of this Agreement, the Deposit
Agreement, the Preferred Stock, the Depositary Shares, the Depositary
Receipts and the Underwritten Shares and the form of the Registration
Statements, each Prospectus (other than financial statements and other
financial data) and all other legal matters relating to this Agreement
and the transactions contemplated hereby shall be satisfactory in all
respects to counsel for the Underwriters, and the Company shall have
furnished to such counsel all documents and information that such
counsel may reasonably request to enable it to pass upon such matters.
(d) [ ] General Counsel of the Company, shall have furnished to
the Representative his opinion addressed to the Underwriters and dated
the Delivery Date to the effect that:
(i) The Company has been duly incorporated and is validly
existing and remains a subsisting corporation under the laws of
the State of Delaware;
(ii) The Company is duly qualified to do business and is in
good standing as a foreign corporation in all jurisdictions in
which its ownership of property or the conduct of its business
requires such qualification (except where the failure to so
qualify would not have a Material Adverse Effect), and has all
power and authority necessary to own its properties and conduct
the business in which it is engaged as described in the
Prospectus;
(iii) No order issued by the Commission directed to any
document incorporated by reference in any Prospectus has been
issued and, to the knowledge of such counsel, no challenge has
been made by the Commission to the accuracy or adequacy of any
such document;
(iv) The Company has an authorized capitalization as set
forth in the Prospectus, and all of the issued shares of capital
stock of the Company, (including the Underwritten Shares being
delivered on the Delivery Date) have been duly and validly
authorized and issued, are fully paid and non-assessable;
(v) There are no preemptive or other rights to subscribe
for or to purchase, nor any restriction upon the voting or
transfer of, any Shares[, or the Common Stock issuable upon
conversion of the Underwritten Shares,] pursuant to the
Certificate of Designations relating to the Preferred Stock, the
Company's charter or by-laws or any agreement or other instrument
known to such counsel;
(vi) Such counsel does not know of any litigation or any
governmental proceeding pending or threatened against the Company
which would affect the subject matter of this Agreement or the
Deposit Agreement or is required to be disclosed in any
<PAGE>
17
Prospectus (including the documents incorporated by reference
therein) which is not disclosed and correctly summarized therein;
and
(vii) The execution, delivery and performance of this
Agreement and the Deposit Agreement and compliance by the Company
with the provisions of the Underwritten Shares, the Certificate of
Designations and the Deposit Agreement [and the issuance and
delivery of the Common Stock issuable upon conversion of the
Underwritten Shares] will not constitute a breach of, or result in
the creation or imposition of any lien, charge or encumbrance upon
any of the assets of the Company pursuant to the terms of, or
constitute a default under, any agreement, indenture or instrument
known to such counsel, or result in a violation of the charter or
by-laws of the Company or, to the best of such counsel's
knowledge, any order, rule or regulation of any court or
governmental agency having jurisdiction over the Company or its
property.
In giving such opinion, such counsel need not express any opinion
regarding any order, consent or other authorization or approval which
may be legally required pursuant to any state securities law.
In rendering such opinion, such counsel may: (i) state that his
opinion is limited to matters governed by the federal laws of the
United States of America, the laws of the District of Columbia and the
General Corporation Law of the State of Delaware and that such counsel
is not admitted in the State of Delaware; and (ii) rely (to the extent
such counsel deems proper and specifies in his opinion), as to matters
involving the application of the laws of other jurisdictions upon the
opinion of other counsel of good standing, PROVIDED that such other
counsel is satisfactory to counsel for the Underwriters and furnishes a
copy of its opinion to the Representative.
(e) Boekel de Neree, special Netherlands counsel to the
Significant Subsidiary, shall have furnished to the Representative its
opinion addressed to the Underwriters and dated the Delivery Date, to
the effect that the Significant Subsidiary has been duly incorporated
and is validly existing as a private limited liability company under
the laws of The Netherlands and has the corporate power and authority
to carry on the business described in the objects clause of its
Articles of Association.
(f) Simpson Thacher & Bartlett, counsel for the Company, shall
have furnished to the Representative its opinion addressed to the
Underwriters and dated the Delivery Date, to the effect that:
(i) The Company has been duly incorporated and is
validly existing and in good standing as a corporation under the
laws of the State of Delaware;
<PAGE>
18
(ii) The Deposit Agreement has been duly authorized,
executed and delivered by the Company and, assuming (A) that the
Deposit Agreement is a valid and binding agreement of the
Depositary and (B) if required by the Deposit Agreement, the
Registrar, constitutes a valid and legally binding instrument of
the Company enforceable against the Company in accordance with its
terms;
(iii) The Underwritten Shares representing the
Underwritten Shares delivered on such Delivery Date have been duly
and validly authorized by the Company; and, assuming the due
execution by the Depositary of the Deposit Agreement, the due
execution by the Depositary and, if required by the Deposit
Agreement, the Registrar of the Depositary Receipts in accordance
with the terms of the Deposit Agreement and (B) upon the deposit
by or on behalf of the Underwriters of the Shares with the
Depositary pursuant to the Deposit Agreement, then such Depositary
Shares will represent legal and valid interests in the
Underwritten Shares delivered on such Delivery Date and the
Depositary Receipts will constitute valid evidence of such
interests in such Underwritten Shares and will be entitled to the
benefits of the Deposit Agreement;
[(iv) The Common Stock issuable on the conversion of the
Underwritten Shares has been duly authorized and reserved for
issuance upon such conversion and, when issued and delivered in
accordance with the terms of the charter will be duly and validly
issued, fully paid and non-assessable;]
(v) The statements made in each Prospectus under the
caption "Description of Offered Preferred Stock--Depositary
Shares" [and "Description of Capital Stock--Common Stock" (or,
with respect to each, a comparable caption), insofar as they
purport to constitute summaries of the documents referred to
therein, constitute accurate summaries of the terms of such
documents in all material respects;
(vi) Each Registration Statement is effective under the
Act and, to the knowledge of such counsel, no stop order
suspending its effectiveness has been issued and no proceeding for
that purpose is pending or threatened by the Commission;
(vii) Each of this Agreement and the Deposit Agreement
has been duly authorized, executed and delivered by the Company;
and
(viii) The Company is not an "investment company" or an
entity "controlled" by an "investment company," as such terms are
defined in the 1940 Act.
Such counsel may state that the opinions set forth in paragraphs (ii)
and (iii) above are subject to the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally, general
<PAGE>
19
equitable principles (whether considered in a proceeding in equity or at law)
and an implied covenant of good faith and fair dealing.
In rendering such opinion, such counsel may state that its opinion is
limited to matters governed by the federal laws of the United States of America,
the laws of the State of New York and the General Corporation Law of the State
of Delaware and that such counsel is not admitted in the State of Delaware.
Such counsel shall also have furnished to the Representative a written
statement, addressed to the Underwriters and dated the Delivery Date, in form
and substance satisfactory to the Representative, to the effect that (1) such
counsel has acted as counsel to the Company in connection with the preparation
of the Registration Statements and the offer and sale of the Underwritten Shares
and the Depositary Shares (although the Company is also represented by its
General Counsel and, with respect to certain other matters, by other outside
counsel); (2) in the course of the preparation by the Company of the
Registration Statements and the Prospectus, such counsel participated in
conferences with certain officers and employees of the Company, with
representatives of KPMG and with counsel to the Company; (3) prior to the
Company's filing with the Commission documents under the Exchange Act, such
counsel reviewed such documents; and (4) based on (a) such counsel's examination
of the Registration Statements, the Prospectus and the documents filed by the
Company under the Exchange Act, (b) such counsel's investigation made in
connection with the preparation of Registration Statements and the Prospectus
(excluding the documents filed by the Company under the Exchange Act) and (c)
such counsel's participation in the conferences referred to in clause (2) of
this paragraph above, (i) that such counsel is of the opinion that the
Registration Statements, as of their respective effective dates, and each
Prospectus, as of its issue date, complied as to form in all material respects
with the requirements of the Act and the Rules and Regulations, and each
document incorporated by reference in each Prospectus as filed under the
Exchange Act complied as to form when filed in all material respects with the
requirements of the Exchange Act and the applicable rules and regulations of the
Commission thereunder, except that in each case no opinion need be expressed as
to the financial statements and other financial data contained or incorporated
by reference therein, and (ii) such counsel has no reason to believe that (I)
either Registration Statement, on the dates they became effective (or, with
respect to such Registration Statements, if the Company has filed an Annual
Report on Form 10-K since their effective dates, the date of the Company's most
recent Annual Report on Form 10-K), contained any untrue statement of a material
fact or omitted to state any material fact required to be stated therein or
necessary in order to make the statements therein not misleading or that the
Prospectus, as of its issue date and as of the Delivery Date, contains any
untrue statement of a material fact or omits to state any material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading or (II)
any document incorporated by reference in the Prospectus when they were filed
with the Commission contained any untrue statement of a material fact or omitted
to state any material fact necessary in order to make the statements therein, in
light of the circumstances under which
<PAGE>
20
they were made, not misleading, except that with respect to each of clauses (I)
and (II) above, such counsel may state that it expresses no belief with respect
to the financial statements or other financial data contained in or incorporated
by reference in the Registration Statements, the Prospectus or documents filed
by the Company under the Exchange Act. The foregoing opinion and statement may
be qualified by a statement to the effect that such counsel has not
independently verified the accuracy, completeness or fairness of the statements
made or included in the Registration Statements, the Prospectus or the documents
filed by the Company under the Exchange Act and takes no responsibility
therefor, except as and to the extent set forth in paragraph (v) above.
(g) The Company shall have furnished to the Representative a
certificate, dated the Delivery Date, of its Chairman of the Board, its
President or a Vice President and its chief financial officer stating
that:
(i) The representations, warranties and agreements of
the Company in Paragraph 1 are true and correct as of the Delivery
Date; the Company has complied with all its agreements contained
herein; and the conditions set forth in Paragraph 9(a) have been
fulfilled;
(ii) (A) Except as described in or contemplated by the
Registration Statements and the Prospectus, neither the Company
nor any of its subsidiaries has sustained, any loss or
interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, or
(B) there has not been any change, or any development involving a
prospective change, in or affecting the general affairs,
management, financial position, stockholders' equity or results of
operations of the Company and its subsidiaries, otherwise than as
described in or contemplated by the Prospectus; and
(iii) They have carefully examined the Registration
Statements and the Prospectus and, in their opinion (A) the
Registration Statements, as of their respective effective dates,
and the Prospectus, as of its issue date, did not include any
untrue statement of a material fact and did not omit to state any
material fact required to be stated therein or necessary to make
the statements therein not misleading, and (B) since the effective
date of Registration Statement (No. 333- ), no event has
occurred which should have been set forth in a supplement or
amendment to either of the Registration Statements or the
Prospectus.
(h) (i) Neither the Company nor any of its subsidiaries shall have
sustained, except as described in or contemplated by the Registration
Statements and the Prospectus, any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or
governmental
<PAGE>
21
action, order or decree, or (ii) there shall not have been any change,
or any development involving a prospective change, in or affecting the
general affairs, management, financial position, stockholders' equity
or results of operations of the Company and its subsidiaries, otherwise
than as set forth or contemplated in the Prospectus, the effect of
which, in any such case described in clause (i) or (ii), is, in the
judgment of the Representative, so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Depositary Shares on the terms and in the manner
contemplated in the Prospectus.
(i) The Company shall have furnished to the Representative (i) a
letter of KPMG, addressed to the Underwriters and dated the date hereof
of the type described in the American Institute of Certified Public
Accountants' Statement on Auditing Standards No. 72 and covering such
specified financial statement items as counsel for the Underwriters may
reasonably have requested and (ii) a letter of KPMG, addressed to the
Underwriters and dated the Delivery Date, stating, as of the date of
such letter (or, with respect to matters involving changes or
developments since the respective dates as of which specified financial
information is given in the Prospectus, as of a date not more than five
days prior to the date of such letter), the conclusions and findings of
such firm with respect to the financial information and other matters
covered by its letter referred to in subclause (i) above, confirming in
all material respects the conclusions and findings set forth in such
prior letter.
(j) The Depositary Shares shall have been accepted for listing on
the Stock Exchange (if any), subject to official notice of issuance.
(k) (i) Neither the Company nor the Significant Subsidiary shall
have sustained, except as described in or contemplated by the
Registration Statements and the Prospectus, any loss or interference
with its business from fire, explosion, flood or other calamity,
whether or not covered by insurance, or from any labor dispute or court
or governmental action, order or decree, or (ii) there shall not have
been any change, or any development involving a prospective change, in
or affecting the general affairs, management, financial position,
stockholders' equity or results of operations of the Company and the
Significant Subsidiary, otherwise than as described in or contemplated
by the Prospectus, the effect of which, in any such case described in
clause (i) or (ii), is, in the judgment of the Representative, so
material and adverse as to make it impracticable or inadvisable to
proceed with the public offering or the delivery of the Depositary
Shares on the terms and in the manner contemplated in the Prospectus.
(l) Subsequent to the execution and delivery of this Agreement,
(i) no downgrading shall have occurred in the rating accorded the
Company's preferred stock by any "nationally recognized statistical
rating organization," as that term is defined by the Commission for
purposes of Rule 436(g)(2) of the Rules and Regulations and (ii) no
such
<PAGE>
22
organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating
of any of the Company's preferred stock.
(m) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in
securities generally on the New York Stock Exchange or the American
Stock Exchange or in the over-the-counter market, or trading in any
securities of the Company on any exchange or in the over-the-counter
market, shall have been suspended or minimum prices shall have been
established on any such exchange or such market by the Commission, by
such exchange or by any other regulatory body or governmental authority
having jurisdiction, (ii) a banking moratorium shall have been declared
by federal or state authorities, (iii) the United States shall have
become engaged in hostilities, there shall have been an escalation in
hostilities involving the United States or there shall have been a
declaration of a national emergency or war by the United States or (iv)
there shall have occurred such a material adverse change in general
economic, political or financial conditions (or the effect of
international conditions on the financial markets in the United States
shall be such) as to make it, in the judgment of a majority in interest
of the several Underwriters, impracticable or inadvisable to proceed
with the public offering or delivery of the Depositary Shares on the
terms and in the manner contemplated in the Prospectus.
All opinions, letters, evidence and certificates mentioned above
or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance
satisfactory to counsel for the Underwriters.
10. REIMBURSEMENT OF UNDERWRITERS' EXPENSES. If the Company shall fail
to tender the Underwritten Shares for delivery to the Underwriters for any
reason permitted under this Agreement, or if the Underwriters shall decline to
purchase the Underwritten Shares for any reason permitted under this Agreement
(other than pursuant to Paragraph 4 hereof), the Company shall reimburse the
Underwriters for reasonable fees and expenses of their counsel and for such
other out-of-pocket expenses as shall have been incurred by them in connection
with this Agreement and the proposed purchase of Underwritten Shares and the
solicitation of any purchases of the Underwritten Shares, and upon demand the
Company shall pay the full amount thereof to the Representative. If this
Agreement is terminated pursuant to Paragraph 4 hereof by reason of the default
of one or more Underwriters, the Company shall not be obligated to reimburse any
defaulting Underwriter on account of those expenses.
11. NOTICES, ETC. The Company shall be entitled to act and rely upon
any request, consent, notice or agreement by, or on behalf of, the
Representative. Any notice by the Company to the Underwriters shall be
sufficient if given in writing or by telegraph addressed to the Representative
at its address set forth in Schedule I hereto, and any notice by the
Underwriters to the Company shall be sufficient if given in writing or by
facsimile addressed to
<PAGE>
23
the Company at 784 Memorial Drive, Cambridge, Massachusetts 02139 (Facsimile
Number: (781) 386-3228), Attention of the Treasurer.
12. PERSONS ENTITLED TO THE BENEFIT OF THIS AGREEMENT. This Agreement
shall be binding upon the Underwriters, the Company, and their respective
successors. This Agreement and the terms and provisions hereof are for the sole
benefit of only those persons, except that (a) the representations, warranties,
indemnities and agreements of the Company contained in this Agreement shall also
be deemed to be for the benefit of the person or persons, if any, who control
any Underwriter within the meaning of Section 15 of the Act, and (b) the
indemnity agreement of the Underwriters contained in Paragraph 7 hereof shall be
deemed to be for the benefit of directors of the Company, officers of the
Company who have signed any Registration Statement and any person controlling
the Company. Nothing in this Agreement is intended or shall be construed to give
any person, other than the persons referred to in this Paragraph, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein.
13. CERTAIN DEFINITIONS. For purposes of this Agreement, (a) "business
day" means any day on which the New York Stock Exchange, Inc. is open for
trading and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules
and Regulations.
14. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
15. COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
16. HEADINGS. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
[THE REST OF THIS PAGE IS LEFT BLANK INTENTIONALLY; THE SIGNATURE PAGE FOLLOWS.]
<PAGE>
24
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this Agreement shall represent a binding agreement among the Company and the
several Underwriters.
Very truly yours,
POLAROID CORPORATION
By
-----------------------------------
Name:
Title:
The foregoing Agreement is hereby confirmed
and accepted as of the date first above
written.
[ ]
By
---------------------------------------
Name:
Title:
For itself and as Representative of the other
Underwriters named in Schedule II to the foregoing
Agreement.
<PAGE>
SCHEDULE I
Underwriting Agreement dated , 1999.
Registration Statement No.'s 333- and 333- .
Representatives and Addresses:
Certificate of Designations, Powers, Preferences and Rights:
Title:
Depositary Shares each representing ________ [INSERT FRACTION] of a share of
__________ [INSERT DESIGNATION] Preferred Stock
Number of Underwritten Shares:
Price per share:
Price to public:
Time of payment of dividends:
Sinking fund provisions:
[Conversion Price of Common Stock:]
Redemption provisions:
Repayment provisions:
Stock Exchange Listing:
Delivery Date, Time and Location:
<PAGE>
SCHEDULE II
<TABLE>
<CAPTION>
NUMBER OF DEPOSITARY
SHARES IN RESPECT OF
UNDERWRITTEN
NAME OF UNDERWRITER SHARES
- --------------------------------------------------------------------------
<S> <C>
.................................................... $
....................................................
----
Total $
----
----
</TABLE>
<PAGE>
Exhibit 4.12
================================================================================
POLAROID CORPORATION
and
STATE STREET BANK AND TRUST COMPANY,
as Trustee
--------------------------------------
SECOND SUPPLEMENTAL INDENTURE
Dated as of _____________, 1999
--------------------------------------
Providing for the Issuance of
Debt Securities in Series
================================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE ONE
Amendments of Certain Provisions of the Original Indenture
SECTION 1. Definitions.................................................................................1
SECTION 2. Documents Required for Issuance of Each Series of Securities
Other than Medium-Term Debt Securities...................................................2
SECTION 3. Supplemental Indentures With Consent of Holders.............................................2
SECTION 4. Maintenance of Office or Agency.............................................................2
SECTION 5. Notice of Redemption........................................................................2
SECTION 6. Subordination...............................................................................3
SECTION 7. Conversion..................................................................................9
SECTION 8. Form of Fixed Rate Security With or Without Optional Redemption
Provision for Convertible or Non-Convertible Senior or
Subordinated Debt Security..............................................................11
SECTION 9. Confirmation of Indenture..................................................................11
SECTION 10. Concerning the Trustee.....................................................................11
SECTION 11. Governing Law..............................................................................11
SECTION 12. Separability...............................................................................12
SECTION 13. Counterparts...............................................................................12
Exhibit I Form of Fixed Rate Security With or Without Optional Redemption Provision
for Convertible or Non-convertible Senior or Subordinated Debt Security
</TABLE>
i
<PAGE>
SECOND SUPPLEMENTAL INDENTURE
This SECOND SUPPLEMENTAL INDENTURE, dated as of ______ __, 1999 (the
"Supplemental Indenture"), by and between POLAROID CORPORATION, a corporation
duly organized and existing under the laws of the State of Delaware (the
"Company"), having its principal office at 784 Memorial Drive, Cambridge,
Massachusetts 02139 and STATE STREET BANK AND TRUST COMPANY, as Trustee (the
"Trustee").
WITNESSETH:
WHEREAS, the Company and the Trustee executed and delivered an
Indenture, dated as of January 9, 1997 (the "Original Indenture," and, together
with the Supplemental Indenture, the "Indenture"), to provide for the issuance
by the Company from time to time of its unsecured debentures, notes or other
evidence of indebtedness (the "Securities") to be issued in one or more series
as provided in the Indenture;
WHEREAS, the Company desires to enter into a supplemental indenture
with the Trustee to provide for the issuance of Securities that are subordinate
and junior in right of payment to its senior debt securities and that are
convertible into shares of its common stock, par value $1.00 (the "Common
Stock") pursuant to Section 10.1(5) of the Original Indenture;
NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:
for and in consideration of the premises stated herein and the purchase of the
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of Securities or series thereof,
as follows:
ARTICLE ONE
AMENDMENTS OF CERTAIN PROVISIONS OF THE ORIGINAL INDENTURE
SECTION 1. DEFINITIONS. (a) Unless otherwise defined herein, the
capitalized terms used herein that are defined in the Original Indenture have
the meanings assigned to them in the Original Indenture.
(b) Section 1.1 of the Original Indenture is hereby amended by
inserting the following definitions in the appropriate alphabetical order of the
existing defined terms which are contained therein:
"Conversion Agent" shall mean any Person authorized by the Company to
facilitate the conversion of any Security which by its terms is convertible into
any other security of the Company. Initially, the Conversion Agent shall be
_____________.
"Senior Debt" shall mean, with respect to the Company, the principal,
premium, if any, and interest on (i) all debt of the Company, whether
outstanding on the date hereof or hereafter created, incurred or assumed, which
is for money borrowed, or evidenced by a note or similar instrument given in
connection with the acquisition of any business, properties or assets,
<PAGE>
2
including securities, (ii) any debt of others of the kinds described in the
preceding clause (i) for the payment of which the Company is responsible or
liable (directly or indirectly, contingently or otherwise) as guarantor or
otherwise and (iii) amendments, renewals, extensions and refundings of any such
debt, unless in any instrument or instruments evidencing or securing such debt
or pursuant to which the same is outstanding, or in any such amendment, renewal,
extension or refunding, it is expressly provided that such debt is not superior
in right of payment to the Securities of any series. The Senior Debt shall
continue to be Senior Debt and entitled to the benefits of the subordination
provisions irrespective of any amendment, modification or waiver of any term of
the Senior Debt or extension or renewal of the Senior Debt.
SECTION 2. DOCUMENTS REQUIRED FOR ISSUANCE OF EACH SERIES OF SECURITIES
OTHER THAN MEDIUM-TERM DEBT SECURITIES. Section 2.2 (a) of the Original
Indenture is hereby amended by renumbering the existing sub-paragraph (23) of
Section 2.2 (a) as sub-paragraph (25) and by inserting, preceding the renumbered
sub-paragraph (25), new sub-paragraphs (23) and (24) as follows:
"(23) whether the Securities are subordinated to any other security of
the Company pursuant to the provisions of Article 15 or as otherwise
specified on the Securities of such series;
(24) whether the Securities are convertible into any other security of
the Company pursuant to the provisions of Article 16 or as otherwise
specified on the Securities of such series;"
SECTION 3. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS. Section
10.2 of the Original Indenture is hereby amended by renumbering sub-paragraphs
(3) and (4) as sub-paragraphs (4) and (5), respectively, and by inserting a new
sub-paragraph (3) as follows:
"(3) if the Outstanding Securities of any series are subordinated, to
modify the subordination provisions contained in this Indenture in any
matter that adversely affects the Holders thereof."
SECTION 4. MAINTENANCE OF OFFICE OR AGENCY. Section 11.2 of the
Original Indenture is hereby amended by inserting after the first sentence
thereof a new second sentence as follows:
"If the Securities of a series are convertible into any other security
of the Company, the Company will maintain in each Place of Payment for
such series an office, which may be an office of the Trustee, or agency
where securities of that series may be presented or surrendered for
conversion."
SECTION 5. NOTICE OF REDEMPTION. Section 12.4 of the Original Indenture
is hereby amended by:
(1) replacing in the first sentence of Section 12.4 the number "30" in
the existing sentence with the number "20" so that it reads as follows:
<PAGE>
3
"Notice of redemption shall be given not less than 20 nor more than 60
days prior to the Redemption Date, to each Holder of Securities to be
redeemed, as provided in Section 1.6." and
(2) by inserting a new sentence after the first sentence of the second
paragraph of Section 12.4 as follows:
If the Securities of such series are convertible into other securities
of the Company, the notice shall also state the conversion price, the
last date on which the Securities may be converted prior to the
Redemption Date, and that the Holders who wish to convert their
Securities must comply with and satisfy all the terms, conditions and
requirements for conversation as set forth in the Securities and/or
this Indenture.
SECTION 6. SUBORDINATION. The Original Indenture is hereby amended by
inserting, immediately following Article 14 thereof, the following new Article
15:
Article XV
SUBORDINATION
Section 15.1. SECURITIES SUBORDINATE TO SENIOR DEBT. The Company
covenants and agrees, and each Holder of Securities of any series (or any
Coupons appertaining thereto) by the Holder's acceptance thereof, likewise
covenants and agrees, that, to the extent and in the manner hereinafter set
forth in this Article 15, the indebtedness represented by the Securities of such
series (or any Coupons appertaining thereto) and the payment of the principal of
(and premium, if any) and interest on each and all of the Securities of such
series (or any Coupons appertaining thereto) are hereby expressly made
subordinate and junior in right of payment to the prior payment in full of all
Senior Debt of the Company, to the extent and in the manner herein set forth
(unless a different manner is set forth in the Securities of such series, or any
Coupons appertaining thereto). No provision of this Article 15 shall prevent the
occurrence of any default or Event of Default hereunder.
Section 15.2. PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC. Upon any
payment by the Company or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, to creditors upon any
dissolution or winding-up or liquidation or reorganization of the Company,
whether voluntary or involuntary or in bankruptcy, insolvency, receivership or
other proceedings, all amounts due upon all Senior Debt of the Company shall
first be paid in full, or payment thereof provided for in money in accordance
with its terms, before any payment is made by the Company on account of the
principal (and premium, if any) or interest on the Securities of any series (or
any Coupons appertaining thereto); and upon any such dissolution or winding-up
or liquidation or reorganization, any payment by the Company, or distribution of
assets of the Company of any kind or character, whether in cash, property or
securities, to which the Holders of the Securities of such series (or any
Coupons appertaining thereto) or the Trustee would be entitled to receive from
the Company, except for the provisions of this Article 15, shall be paid by the
Company or by any receiver, trustee in
<PAGE>
4
bankruptcy, liquidating trustee, agent or other Person making such payment or
distribution, or by the Holders of the Securities of such series (or any Coupons
appertaining thereto) or by the Trustee under the Indenture if received by them
or it, directly to the holders of Senior Debt of the Company (pro rata to such
holders on the basis of the respective amounts of Senior Debt held by such
holders, as calculated by the Company) or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing such Senior Debt may have been issued, as their
respective interests may appear, to the extent necessary to pay such Senior Debt
in full, in money or money's worth, after giving effect to any concurrent
payment or distribution to or for the holders of such Senior Debt, before any
payment or distribution is made to the Holders of the Securities of such series
(or any Coupons appertaining thereto) or to the Trustee.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, prohibited by the foregoing, shall be received by the
Trustee before all Senior Debt of the Company is paid in full, or provision is
made for such payment in money in accordance with its terms, such payment or
distribution shall be held in trust for the benefit of and shall be paid over or
delivered to the holders of such Senior Debt or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing such Senior Debt may have been issued, and
their respective interests may appear, as calculated by the Company, for
application to the payment of all Senior Debt of the Company, as the case may
be, remaining unpaid to the extent necessary to pay such Senior Debt in full in
money in accordance with its terms, after giving effect to any concurrent
payment or distribution to or for the benefit of the holders of such Senior
Debt.
For purposes of this Article 15 only, the words "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment which are subordinated
in right of payment to all Senior Debt which may at the time be outstanding to
substantially the same extent as, or to a greater extent than, the Securities of
any series (or any Coupons appertaining thereto) are so subordinated as provided
in this Article 15. The consolidation of the Company with, or the merger of the
Company into, another Person or the liquidation or dissolution of the Company
following the conveyance or transfer of its properties and assets substantially
as an entirety to another Person upon the terms and conditions set forth in
Article 9 shall not be deemed a dissolution, winding up, liquidation,
reorganization, assignment for the benefit of creditors or marshalling of assets
and liabilities of the Company for the purposes of this Section if the Person
formed by such consolidation or into which the Company is merged or, the Person
which acquires by conveyance or transfer such properties and assets
substantially as an entirety, as the case may be, shall, as a part of such
consolidation, merger, conveyance or transfer, comply with the conditions set
forth in Article 9.
Section 15.3. PRIOR PAYMENT OF SENIOR DEBT UPON ACCELERATION OF
SECURITIES. In the event that any of the Securities of any series (or any
Coupons appertaining thereto) are declared due and payable before the Stated
Maturity, then and in such event the holders of Senior Debt shall be entitled to
receive payment in full of all amounts due or to become due on or in respect of
all Senior Debt or provision shall be made for such payment in cash, before the
<PAGE>
5
Holders of the Securities of such series (or any Coupons appertaining thereto)
are entitled to receive any payment (including any payment which may be payable
by reason of the payment of any other indebtedness of the Company being
subordinated to the payment of the Securities of such series (or any Coupons
appertaining thereto)) by the Company on account of the principal of (or
premium, if any) or interest on the Securities of such series (or any Coupons
appertaining thereto) or on account of the purchase or other acquisition of
Securities of such series (or any Coupons appertaining thereto).
In the event that, notwithstanding the foregoing, the Company shall
make any payment to the Trustee or the Holder of any Securities of such series
(or any Coupons appertaining thereto) prohibited by the foregoing provisions of
this Section, and if such fact shall, at or prior to the time of such payment,
have been made known to the Trustee or, as the case may be, such Holder, then
and in such event such payment shall be paid over and delivered forthwith to the
Company.
The provisions of this Section shall not apply to any payment with
respect to which Article 16 and the terms of any convertible Securities of any
series set forth in an Officers' Certificate or established in one or more
indentures supplemental hereto in accordance with Section 2.2(a), 2.2(b),
10.1(5) and 10.1(6) would be applicable.
Section 15.4. NO PAYMENT WHEN SENIOR DEBT IN DEFAULT. In the event and
during the continuation of any default by the Company in the payment of
principal, premium, interest or any other payment due on any Senior Debt of the
Company, as the case may be, beyond any applicable grace period with respect
thereto, or in the event that the maturity of any Senior Debt of the Company, as
the case may be, has been accelerated because of a default, then, in any such
case, no payment shall be made by the Company with respect to the principal,
premium, if any, or interest on the Securities of any series (or any Coupons
appertaining thereto) until such default is cured or waived or ceases to exist
or any such acceleration or demand for payment has been rescinded.
In the event that, notwithstanding the foregoing, any payment shall be
received by the Trustee when such payment is prohibited by the preceding
paragraph of this Section 15.4, such payment shall be held in trust for the
benefit of, and shall be paid over or delivered to, the holders of Senior Debt
or their respective representatives, or to the trustee or trustees under any
indenture pursuant to which any of such Senior Debt may have been issued, as
their respective interests may appear, but only to the extent that the holders
of the Senior Debt (or their representative or representatives or a trustee)
notify the Trustee in writing within 90 days of such payment of the amounts then
due and owing on the Senior Debt and only the amounts specified in such notice
to the Trustee shall be paid to the holders of Senior Debt.
Section 15.5. PAYMENT PERMITTED IN CERTAIN SITUATIONS. Nothing
contained in this Article 15 or elsewhere in the Indenture or in any of the
Securities of any series (or any Coupons appertaining thereto) shall prevent (a)
the Company, at any time except during the pendency of any dissolution,
winding-up, liquidation or reorganization of the Company, whether voluntary or
involuntary or any bankruptcy, insolvency, receivership or other proceedings of
the Company referred to in Section 15.2 or under the conditions described in
Section 15.3 or Section 15.4,
<PAGE>
6
from making payments at any time of principal of, or premium, if any, or
interest on the Securities of such series, or (b) the application by the Trustee
of any money deposited with it hereunder to the payment of or on account of the
principal of, or premium, if any, or interest on the Securities of such series
(or any Coupons appertaining thereto) or the retention of such payment by the
Holders, if, at the time of such application by the Trustee, it did not have
knowledge that such payment would have been prohibited by the provisions of this
Article 15.
Section 15.6. SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR DEBT. Subject
to the payment in full of all Senior Debt or the provision for such payment in
cash or cash equivalents or otherwise in a manner satisfactory to the holders of
Senior Debt, the rights of the Holders of Securities of any series (or any
Coupons appertaining thereto) shall be subrogated to the extent of the payments
or distributions made to the holders of such Senior Debt pursuant to the
provisions of this Article 15 (equally and ratably with the holders of
indebtedness of the Company which by its express terms is subordinated to
indebtedness of the Company to substantially the same extent as the Securities
of such series (or any Coupons appertaining thereto) are subordinated to the
Senior Debt and is entitled to like rights of subrogation) to the rights of the
holders of such Senior Debt to receive payments and distributions of cash,
property and securities applicable to the Senior Debt until the principal of
(and premium, if any) and interest on the Securities of such series (or any
Coupons appertaining thereto) shall be paid in full. For purposes of such
subrogation, no payments or distributions to the holders of the Senior Debt of
any cash, property or securities to which the Holders of Securities of any
series (or any Coupons appertaining thereto) or the Trustee would be entitled
except for the provisions of this Article 15, and no payments over pursuant to
the provisions of this Article 15 to or for the benefit of the holders of Senior
Debt by Holders of Securities of such series (or any Coupons appertaining
thereto) or the Trustee shall, as among the Company, its creditors other than
holders of Senior Debt and the Holders of Securities of such series (or any
Coupons appertaining thereto), be deemed to be a payment or distribution by the
Company to or on account of the Senior Debt.
Section 15.7. PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS. The
provisions of this Article 15 are and are intended solely for the purpose of
defining the relative rights of the Holders of Securities of any series (or any
Coupons appertaining thereto) on the one hand and the holders of Senior Debt on
the other hand. Nothing contained in this Article 15 or elsewhere in the
Indenture or in the Securities of such series (or any Coupons appertaining
thereto) is intended to or shall (a) impair, as among the Company, its creditors
other than holders of Senior Debt and the Holders of Securities of such series
(or any Coupons appertaining thereto), the obligation of the Company, which is
absolute and unconditional (and which, subject to the rights under this Article
15 of the holders of Senior Debt, is intended to rank equally with all other
general obligations of the Company), to pay to the Holders of Securities of such
series (or any Coupons appertaining thereto) the principal of (and premium, if
any) and interest on, the Securities of such series (or any Coupons appertaining
thereto) as and when the same shall become due and payable in accordance with
their terms; or (b) affect the relative rights against the Company of the
Holders of Securities of such series (or any Coupons appertaining thereto) and
creditors of the Company, as the case may be, other than the holders of Senior
Debt; or (c) prevent the Trustee or the Holder of any Securities of such series
(or any Coupons appertaining thereto) from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to
<PAGE>
7
the rights, if any, under this Article 15 of the holders of Senior Debt to
receive cash, property and securities otherwise payable or deliverable to the
Trustee or such Holder.
Section 15.8. TRUSTEE TO EFFECTUATE SUBORDINATION. Each Holder of
Securities of any series (or any Coupons appertaining thereto) by such Holder's
acceptance thereof authorizes and directs the Trustee on such Holder's behalf to
take such action as may be necessary or appropriate to effectuate the
subordination provided in this Article 15 and appoints the Trustee such Holder's
attorney-in-fact for any and all such purposes.
Section 15.9. NO WAIVER OF SUBORDINATION PROVISIONS. No right of any
present or future holder of any Senior Debt to enforce subordination as herein
provided shall at any time in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or by any act or failure to act, in
good faith, by any such holder, or by any noncompliance by the Company with the
terms, provisions and covenants of this Indenture, regardless of any knowledge
thereof any such holder may have or be otherwise charged with.
Without in any way limiting the generality of the foregoing paragraph,
the holders of Senior Debt may, at any time and from time to time, without the
consent of or notice to the Trustee or the Holders of Securities of any series
(or any Coupons appertaining thereto), without incurring responsibility to the
Holders of Securities of such series (or any Coupons appertaining thereto) and
without impairing or releasing the subordination provided in this Article 15 or
the obligations hereunder of the Holders of Securities of such series (or any
Coupons appertaining thereto) to the holders of Senior Debt do any one or more
of the following: (a) change the manner, place or terms of payment or extend the
time of payment of, or renew or alter, Senior Debt or otherwise amend or
supplement in any manner Senior Debt or any instrument evidencing the same or
any agreement under which Senior Debt is outstanding; (b) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Debt; (c) release any Person liable in any manner for the
collection of Senior Debt, and (d) exercise or refrain from exercising any
rights against the Company and any other Person.
Section 15.10. NOTICE TO TRUSTEE. The Company shall give prompt written
notice to a Responsible Trust Officer of the Trustee of any fact known to the
Company which would prohibit the making of any payment to or by the Trustee in
respect of any Securities of any series (or any Coupons appertaining thereto)
pursuant to the provisions of this Article 15. Notwithstanding the provisions of
this Article 15 or any other provision of the Indenture, the Trustee shall not
be charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee in respect of any Securities of any
series (or any Coupons appertaining thereto) pursuant to the provisions of this
Article 15, unless and until a Responsible Trust Officer of the Trustee shall
have received written notice thereof from the Company or a holder or holders of
Senior Debt or from any trustee therefor; and, prior to the receipt of any such
written notice, the Trustee, subject to the provisions of Section 7.3, shall be
entitled in all respects to assume that no such facts exist; provided, however,
that if the Trustee shall have not received the notice provided for in this
Section at least two Business Days prior to the date upon which by the terms
hereof any money may become payable for any purpose (including, without
limitation, the payment of the principal of (or premium, if any) or interest on
any Securities of any series (or any Coupons appertaining thereto)), then,
anything herein
<PAGE>
8
contained to the contrary notwithstanding, the Trustee shall have full power and
authority to receive such moneys and to apply the same to the purposes for which
they were received, and shall not be affected by any notice to the contrary that
may be received by it within two Business Days prior to such date.
Subject to the provisions of Section 7.3, the Trustee shall be entitled
to rely on the delivery to it of a written notice by a Person representing
himself to be a holder of Senior Debt (or a trustee therefor) to establish that
such notice has been given by a holder of Senior Debt (or a trustee therefor).
In the event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior Debt to
participate in any payment or distribution pursuant to this Article 15, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Debt held by such Person,
the extent to which such Person is entitled to participate in such payment or
distribution and any other facts pertinent to the rights of such Person under
this Article 15, and if such evidence is not furnished, the Trustee may defer
any payment to such Person pending judicial determination as to the right of
such Person to receive such payment.
Section 15.11. RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING
AGENT. Upon any payment or distribution of assets of the Company referred to in
this Article 15, the Trustee, subject to the provisions of Section 7.3, and the
Holders of Securities of any series (or any Coupons appertaining thereto) shall
be entitled to conclusively rely upon any order or decree entered by any court
of competent jurisdiction in which such insolvency, bankruptcy, receivership,
liquidation, reorganization, dissolution, winding up or similar case or
proceeding is pending, or a certificate of the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee for the benefit of creditors, agent or
other Person making such payment or distribution, delivered to the Trustee or to
the Holders of Securities of such series (or any Coupons appertaining thereto),
for the purpose of ascertaining the Persons entitled to participate in such
payment or distribution, the holders of Senior Debt and other indebtedness of
the Company, as the case may be, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article 15.
Section 15.12. TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR DEBT. With
respect to the holders of Senior Debt, the Trustee undertakes to perform or to
observe only such of its covenants and obligations as are specifically set forth
in this Article 15, and no implied covenants or obligations with respect to the
holders of such Senior Debt shall be read into the Indenture against the
Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Debt and shall not be liable to any such holders or creditors
if it shall in good faith pay over or distribute to Holders of Securities of any
series (or any Coupons appertaining thereto) or to the Company or to any other
Person cash, property or securities to which any holders of Senior Debt shall be
entitled by virtue of this Article 15 or otherwise.
Section 15.13. RIGHTS OF TRUSTEE AS HOLDER OF SENIOR DEBT, PRESERVATION
OF TRUSTEE'S RIGHTS. The Trustee in its individual capacity shall be entitled to
all the rights set forth in this Article 15 with respect to any Senior Debt
which may at any time be held by it, to the same extent as any other holder of
Senior Debt and nothing in the Indenture shall deprive the Trustee of any of its
rights as such holder.
<PAGE>
9
Nothing in this Article 15 shall apply to claims of, or payments to,
the Trustee under or pursuant to Section 7.7.
Section 15.14. ARTICLE APPLICABLE TO PAYING AGENTS. In case at any time
any Paying Agent other than the Trustee shall have been appointed by the Company
and be then acting hereunder, the term 'Trustee' as used in this Article 15
shall in such case (unless the context otherwise requires) be construed as
extending to and including such Paying Agent within its meaning as fully for all
intents and purposes as if such Paying Agent were named in this Article 15 in
addition to or in place of the Trustee; PROVIDED, HOWEVER, that this Section
15.14 shall not apply to the Company or any Affiliate of the Company if it or
such Affiliate acts as Paying Agent.
Section 15.15. CERTAIN CONVERSIONS DEEMED PAYMENT. For the purposes of
this Article 15 only, (a) the issuance and delivery of junior securities (or
cash paid in lieu of fractional shares) upon conversion of Securities of any
series (or any Coupons appertaining thereto) in accordance with Article 16, or
pursuant to the terms set forth in an Officers' Certificate or established in
one or more indentures supplemental hereto in accordance with Section 2.2(b) and
10.1, shall not be deemed to constitute a payment or distribution on account of
the principal of or premium or interest on Securities of such series (or any
Coupons appertaining thereto) or on account of the purchase or other acquisition
of Securities of such series (or any Coupons appertaining thereto), and (b) the
payment, issuance or delivery of cash, property or securities (other than Junior
Securities and cash paid in lieu of fractional shares) upon conversion of a
Securities of any series (or any Coupons appertaining thereto) shall be deemed
to constitute payment on account of the principal of such Securities of such
series (or any Coupons appertaining thereto). Nothing contained in this Article
15 or elsewhere in the Indenture or in the Securities of any series (or any
Coupons appertaining thereto) is intended to or shall impair, as among the
Company, its creditors other than holders of Senior Debt and the Holders of
Securities of such series (or any Coupons appertaining thereto), the right,
which is absolute and unconditional, of the Holder of any Securities of such
series (or any Coupons appertaining thereto) to convert such Securities of such
series (or any Coupons appertaining thereto) in accordance with Article 16 and
the terms set forth in an Officers' Certificate or established in one or more
indentures supplemental hereto in accordance with Section 2.2(b) and 10.1.
Section 15.16. FORM OF SUBORDINATED SECURITIES. The Securities
evidencing the fixed rate and subordinated indebtedness of the Company, as may
be executed by the Company and delivered to the Trustee for authentication and
delivered to, or upon the order of the Company, pursuant to the terms of the
Indenture and this Article 15, shall be substantially in the form of Exhibit A.3
hereto.
SECTION 7. CONVERSION. The Original Indenture is hereby amended by
inserting, immediately following the new Article 15 thereof, the following the
new Article 16:
<PAGE>
10
ARTICLE SIXTEEN
CONVERSION
Section 16.1. APPLICABILITY OF ARTICLE. Securities of any series which
are designated as being convertible into any other security of the Company prior
to their Stated Maturity shall be convertible in accordance with their terms and
(except as otherwise specified pursuant to Section 2.1 for the Securities of
such series) in accordance with this Article.
Section 16.2. CONVERSION PRIVILEGE. A Holder of a Security of a series,
which, by its terms, is convertible into any other security of the Company, may
convert such Security at any time during the period and in the manner as is set
forth in the terms of the Securities of that series. The number of shares or
units of such other security issuable upon conversion of a Security shall be
determined in the manner set forth in the terms of such Security.
Section 16.3. CONVERSION PROCEDURE. To convert a Security, the Holder
thereof must comply with and satisfy all of the terms, conditions and other
requirements set forth in the terms of such Security. As soon as practicable,
the Company shall deliver through the Conversion Agent a certificate for the
number of shares or units of the Security issuable upon the conversion.
Section 16.4. FRACTIONAL SHARES. The terms of the Securities shall set
forth whether the Company will issue a fractional share or units of a security
upon conversion of a Security or instead will deliver its check for the value of
the fractional share or units of a security.
Section 16.5. TAXES ON CONVERSION. The terms of the Security shall
state whether the Company will pay any documentary, stamp or similar issue or
transfer tax, due on the issue of shares or units of the security issuable and
whether upon the conversion the Holder will be required to pay any such tax
which is due because such shares or units are issued in a name other than that
of such Holder.
Section 16.6. COMPANY TO PROVIDE SECURITIES ISSUABLE UPON CONVERSION.
The Company shall reserve or otherwise provide for a sufficient amount of its
respective securities, free from preemptive rights, which would be issuable upon
the conversion of the Securities, including reserving out of its respective
authorized but unissued equity securities or its equity securities held in
treasury enough shares of equity securities to permit the conversion of the
Securities.
All shares of equity securities which may be issued upon conversion of
the Securities shall be fully paid and non-assessable.
The Company will endeavor to comply with all securities laws regulating
the offer and delivery of shares or units of its respective securities upon
conversion of Securities and will endeavor to list such shares or units on any
national securities exchange on which such shares or units are listed.
<PAGE>
11
Section 16.7. ADJUSTMENTS. The terms of the Securities shall set forth
the nature of mechanics for and notice of any adjustments in the number or price
of securities of the Company issuable upon conversion of the Securities.
Section 16.8. VALUATION. The terms of the Securities shall set forth
the method or methods for valuing the securities of the Company issuable upon
conversion of the Securities.
Section 16.9. REORGANIZATION OF COMPANY. The terms of the Securities
shall set forth the rights, if any, of the Holders to, convert their Securities
in the event that the Company is a party to a transaction subject to Article 9
or a merger which reclassifies or changes its outstanding Securities into which
the Securities are convertible.
Section 16.10. TRUSTEE'S DISCLAIMER. The Trustee has no duty to
determine when an adjustment under this Article or the terms of the Securities
should be made, how it should be made or what it should be. The Trustee makes no
representation as to the validity or value of any securities issued upon
conversion of Securities. The Trustee shall not be responsible for the failure
of the Company to comply with this Article. Each Conversion Agent other than the
Company shall have the same protection under this Section as the Trustee.
Section 16.11. FORM OF CONVERTIBLE SECURITIES. The Securities
evidencing the convertible indebtedness of the Company, as may be executed by
the Company and delivered to the Trustee for authentication and delivered to, or
upon the order of the Company, pursuant to the terms of the Indenture and this
Article 16, shall be substantially in the form of Exhibit A.3 hereto.
SECTION 8. FORM OF FIXED RATE SECURITY WITH OR WITHOUT OPTIONAL
REDEMPTION PROVISION FOR CONVERTIBLE OR NON-CONVERTIBLE SENIOR OR SUBORDINATED
DEBT SECURITY. Exhibit A.3 to the Original Indenture is hereby amended and
replaced in its entirety by a new Exhibit A.3. which is in the form of Exhibit I
to this Supplemental Indenture.
SECTION 9. CONFIRMATION OF INDENTURE. The Original Indenture, as
modified, supplemented and superseded by this Supplemental Indenture, is in all
respects ratified and confirmed, and the Original Indenture and this
Supplemental Indenture shall be read, taken and construed as one and the same
instrument. References herein to the Indenture shall be deemed to be to the
Original Indenture, as modified supplemented and superseded by this Supplemental
Indenture.
SECTION 10. CONCERNING THE TRUSTEE. The Trustee assumes no duties,
responsibilities or liabilities by reason of this Supplemental Indenture other
than as set forth in the Indenture and, in carrying out its responsibilities
hereunder, shall have all of the rights, protections and immunities which it
possesses under the Indenture.
SECTION 11. GOVERNING LAW. This Supplemental Indenture, shall be
governed by and construed in accordance with the laws of the State of New York.
<PAGE>
12
SECTION 12. SEPARABILITY. In case any provision in this Supplemental
Indenture shall for any reason be held to be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
SECTION 13. COUNTERPARTS. This Supplemental Indenture may be executed
in any number of counterparts each of which shall be an original, but such
counterparts shall together constitute but one and the same instrument.
[THE REST OF THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY; THE SIGNATURE
PAGE FOLLOWS.]
<PAGE>
13
IN WITNESS WHEREOF, the parties hereto have caused this Second
Supplemental Indenture to be duly executed, and their respective corporate seals
to be hereunto affixed and attested, all as of the day and year first above
written.
POLAROID CORPORATION,
By:
-----------------------------
Name:
Title:
Attest:
- -----------------------------
Name:
Title:
STATE STREET BANK AND TRUST COMPANY,
as Trustee,
By:
-----------------------------
Name:
Title:
<PAGE>
Exhibit I to this Supplemental Indenture
- --------------------------------------------------------------------------------
Exhibit A.3
FORM OF FIXED RATE SECURITY WITH OR WITHOUT OPTIONAL REDEMPTION PROVISION
FOR CONVERTIBLE OR NON-CONVERTIBLE SENIOR OR SUBORDINATED DEBT SECURITY
(Form of Face of [Note](1)/)
[Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to the issuer
or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other name
as is requested by an authorized representative of DTC (and any payment is made
to Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.](2)/
POLAROID CORPORATION
% [Convertible] [Subordinated] Note due
No.: ______________ CUSIP No.: ____________
$_____________________
POLAROID CORPORATION, a corporation duly organized and existing
under the laws of the State of Delaware (herein called the "Company", which
term includes any successor corporation under the Indenture referred to on
the reverse hereof), for value received, hereby promises to pay to or
registered assigns, the principal sum of Dollars, at the office or agency of
the Company designated for such purpose, on _____________, in such coin or
currency of the United States of America as at the time of payment shall be
legal tender for the payments of public and private debts, and to pay
interest, semi-annually on and _____________ of each year, on said principal
sum at said office or agency, in like coin or currency, at the rate of _____%
per annum, from the _____________ or the _____________, as the case maybe,
next preceding the date of this Note to which interest has been paid, unless
the date hereof is a date to which interest has been paid, in
- --------
(1)/ BRACKETED REFERENCES TO "NOTE" OR "NOTES" SHOULD BE CHANGED TO REFLECT
THE DESIGNATION OF THE SERIES OF SECURITIES BEING ISSUED.
(2)/ THE BRACKETED LANGUAGE IS TO BE INCLUDED IF THE NOTES ARE INCLUDED
WITHIN DTC'S BOOK-ENTRY SYSTEM.
<PAGE>
2
which case from the date of this Note, or unless no interest has been paid on
the Notes (as defined on the reverse hereof), in which case from until
payment of said principal sum has been made or duly provided for.
Notwithstanding the foregoing, if the date hereof is after __________ or
__________ as the case may be, and before the following or __________, this
Note shall bear interest from such or __________, PROVIDED, HOWEVER, that if
the Company shall default in the payment of interest due on such __________
or __________, then this Note shall bear interest from the next preceding
__________ or __________ to which interest has been paid, or, if no interest
has been paid on the Notes, from __________. The interest so payable on any
__________ or will subject to certain exceptions provided in the Indenture
referred to on the reverse hereof, be paid to the person in whose name this
Note is registered at the close of business on such __________ or __________,
as the case may be, next preceding such __________ or, unless the Company
shall default in the payment of interest due on such interest payment date,
in which case such defaulted interest, at the option of the Company, may be
paid to the person in whose name this Note is registered at the close of
business on a special record date for the payment of such defaulted interest
established by notice to the registered holders of Notes not less than 10
days preceding such special record date or may be paid in any other lawful
manner not inconsistent with the requirements of any securities exchange on
which the Notes may be listed. Payment of interest may, at the option of the
Company, be made by check mailed to the registered address of the person
entitled thereto.
Reference is made to the further provisions of this Note set forth on
the reverse hereof. Such further provisions shall for all purposes have the same
effect as though fully set forth at this place.
This Note shall not be valid or become obligatory for any purpose until
the certificate of authentication hereon shall have been signed by the Trustee
under the Indenture referred to on the reverse hereof.
<PAGE>
3
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
Dated:
POLAROID CORPORATION
By:
---------------------------------
Name:
Title:
By:
---------------------------------
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein issued
under the within-mentioned Indenture.
STATE STREET BANK AND TRUST
COMPANY, as Trustee
By:
---------------------------------
Authorized Signatory
<PAGE>
4
(Form of Reverse of Note )
This Note is one of a duly authorized issue of
[convertible][subordinated] unsecured debentures, notes or other evidences of
indebtedness of the Company (hereinafter called the "Notes"), of the series
hereinafter specified, all issued or to be issued under an indenture dated as of
January 9, 1997 (hereinafter called the "Original Indenture" ), duly executed
and delivered by the Company to State Street Bank and Trust Company, a trust
company duly organized and existing under the laws of the Commonwealth of
Massachusetts, as trustee (hereinafter called the "Trustee"), and, as
supplemented by a Supplemental Indenture dated as of February 17, 1999 (the
"First Supplemental Indenture") and by second supplemental indenture dated as of
_______, 1999 (the "Second Supplemental Indenture" and, together with the First
Supplemental Indenture and Original Indenture, the "Indenture"), duly executed
and delivered by the Company to the Trustee, to which Indenture and all
indentures supplemental thereto reference is hereby made for a description of
the respective rights and duties thereunder of the Trustee, the Company and the
holders of the Notes. The Notes may be issued in one or more series, which
different series may be issued in various aggregate principal amounts, may
mature at different times, may bear interest at different rates, may be subject
to different redemption provisions, may be subject to different sinking,
purchase or analogous funds, may be subject to different covenants and Events of
Default and may otherwise vary as in the Indenture provided. This Note is one of
a series designated as the "___ % [Convertible][Subordinated] Notes due ____"
of the Company issued under the Indenture, limited in aggregate principal amount
to $_____________.
In case an Event of Default with respect to the Notes, as defined in
the Indenture, shall have occurred and be continuing, the principal hereof
together with interest accrued thereon, if any, may be declared, and upon such
declaration shall become, due and payable, in the manner, with the effect and
subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the holders of not less than a majority in
aggregate principal amount of the Securities at the time outstanding of all
series to be affected (acting as one class) to execute supplemental indentures
adding any provisions to or changing in any manner or eliminating any of the
provisions of the Indenture or of any supplemental indenture or modifying in any
manner the rights of the holders of the Securities of such series to be
affected; PROVIDED, HOWEVER, that no such supplemental indenture shall, among
other things, (i) change the fixed maturity of the principal of, or any
installment of principal of or interest on, any Security; (ii) reduce the
principal amount thereof or the rate of interest thereon or any premium payable
upon the redemption thereof; (iii) impair the right to institute suit for the
enforcement of any such payment on or after the fixed maturity thereof (or, in
the case of redemption, on or after the redemption date) or affect adversely
affect the terms of conversion; (iv) reduce the percentage in principal amount
of the outstanding Securities of any series, the consent of whose holders is
required for any such supplemental indenture, or the consent of whose holders is
required for any waiver (of compliance with certain provisions of the Indenture
or certain defaults thereunder and their consequences) provided for in the
Indenture; (v) change any obligation of the Company, with respect to outstanding
Securities of a series, to maintain an office or agency in the places and for
the purposes specified in the Indenture for such series; (vi) modify the
subordination provisions
<PAGE>
5
of the Indenture in any matter that adversely affects the holder of each
outstanding Security; or (vii) modify any of the foregoing provisions or the
provisions for the waiver of certain covenants and defaults, except to increase
any applicable percentage of the aggregate principal amount of outstanding
Securities the consent of the holders of which is required or to provide with
respect to any particular series the right to condition the effectiveness of any
supplemental indenture as to that series on the consent of the holders of a
specified percentage of the aggregate principal amount of outstanding Securities
of such series or to provide that certain other provisions of the Indenture
cannot be modified or waived without the consent of the holder of each
outstanding Security affected thereby.
It is also provided in the Indenture that the holders of a majority in
aggregate principal amount of the Securities of a series at the time outstanding
may on behalf of the holders of all the Securities of such series waive any past
default under the Indenture with respect to such series and its consequences,
except a default in the payment of the principal of, premium, if any, or
interest, if any, on any Security of such series or in respect of a covenant or
provision which cannot be modified without the consent of the Holder of each
outstanding Security of the series affected. Any such consent or waiver by the
holder of this Note shall be conclusive and binding upon such holder and upon
all future holders and owners of the Note and any Notes which may be issued in
exchange or substitution herefor, irrespective of whether or not any notation
thereof is made upon this Note or such other Notes.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of, and premium, if any, and
interest on this Note at the place, at the respective times, at the rate and in
the coin or currency herein prescribed.
[The Notes shall be subordinate and junior on right of payment to the
prior payment in full of all Senior Debt of the Company to the extent and in the
manner set forth in Article 15 of the Indenture. Each Holder of this Note, by
accepting the same, (a) agrees to and shall be bound by such provisions, (b)
authorizes and directs the Trustee on his or her behalf to take such action as
may be necessary or appropriate to acknowledge or effectuate the subordination
so provided and (c) appoints the Trustee his or her attorney-in-fact for any and
all such purposes. Each Holder hereof, by his or her acceptance hereof, hereby
waives all notice of the acceptance of the subordination provisions contained
herein and in the Indenture by each holder of Senior Debt, whether now
outstanding or hereafter incurred, and waives reliance by each such Holder upon
said provisions.](3)/
The Indenture permits the Company to discharge its obligations with
respect to the Notes on the first day following the satisfaction of the
conditions set forth in the Indenture, which include the irrevocable deposit
with the Trustee of money or U.S. Government Obligations or a combination
thereof sufficient to pay and discharge each installment of principal of
(including premium, if any, on) and interest, if any, on the outstanding Notes.
- ------------------
(3)/ THE BRACKETED LANGUAGE IS TO BE INCLUDED IF THE NOTES ARE SUBORDINATED.
<PAGE>
6
If the Company shall, in accordance with Section 9.1 of the Indenture,
consolidate with or merge into any other corporation or convey or transfer its
properties and assets substantially as an entirety to any Person, the successor
shall succeed to, and be substituted for, the Person named as the "Company" on
the face of this Note , all on the terms set forth in the Indenture.
The Notes are issuable in registered form without coupons in
denominations of $1,000 or any integral multiple thereof. In the manner and
subject to the limitations provided in the Indenture, but without the payment of
any service charge, Notes may be exchanged for an equal aggregate principal
amount of Notes of other authorized denominations at the office or agency of the
Company maintained for such purpose in the Borough of Manhattan, the City and
State of New York.
The Notes may be redeemed as a whole, or from time to time in part, at
the option of the Company at any time upon mailing a notice of such redemption
not less than 30 nor more than 60 days prior to the date fixed for redemption to
the holders of the Notes at their last registered addresses, all as provided in
the Indenture, at the following optional redemption prices (expressed in
percentages of the principal amount), together in each case with accrued
interest to the date fixed for redemption.
If redeemed during the twelve-month period beginning
YEAR [PERCENTAGE] (4)/
---- ---------------
Upon due presentment for registration of transfer of this Note at the
office or agency of the Company for such registration in the Borough of
Manhattan, the City and State of New York, a new Note or Notes of authorized
denominations for an equal aggregate principal amount will be issued to the
transferee in exchange herefor, subject to the limitations provided in the
Indenture, without charge except for any tax or other governmental charge
imposed in connection therewith.
Prior to due presentment for registration of transfer of this Note, the
Company, the Trustee and any agent of the Company or the Trustee may deem and
treat the registered holder hereof as the absolute owner of this Note (whether
or not this Note shall be overdue) for the purpose of receiving payment of the
principal of, premium, if any, and interest on this Note, as herein provided,
and for all other purposes, and neither the Company nor the Trustee nor any
agent of the Company or the Trustee shall be affected by any notice to the
contrary. All payments made to or upon the order of such registered holder
shall, to the extent of the sum or sums paid, effectively satisfy and discharge
liability for moneys payable on this Note.
No recourse for the payment of the principal of, premium, if any, or
interest on this Note, or for any claim based hereon or otherwise in respect
hereof, and no recourse under or
- ----------------
(4)/ BRACKETED LANGUAGE TO BE INCLUDED IN NOTES REDEEMABLE AT THE OPTION OF
THE COMPANY.
<PAGE>
7
upon any obligation, covenant or agreement of the Company in the Indenture or
any indenture supplemental thereto or in any Note, or because of the creation of
any indebtedness represented thereby, shall be had against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Company or of any successor corporation, either directly or through the Company
or any successor corporation, whether by virtue of any constitution, statute or
rule of law or by the enforcement of any assessment or penalty or otherwise, all
such liability being, by the acceptance hereof and as part of the consideration
for the issue hereof, expressly waived and released.
[Subject to and upon compliance with Article 16 of the Indenture, the
Holder of this Note has the right, exercisable at anytime prior to the date this
Note is called for redemption by the Company, if applicable, and subject to
limited exceptions specified in the Indenture, to convert the principal amount
hereof (or any portion thereof that is an integral multiple of the principal
amount of one Note) into that number of fully paid and non-assessable shares of
common stock, par value $1.00 (the "Common Stock"), of the Company obtained by
dividing the principal amount of the Notes to be converted by the conversion
price for such Note pursuant to the terms of the Indenture (the "Conversion
Price") in effect on the date set for the conversion of such Note (the
"Conversion Date") for such Note pursuant to the terms of the Indenture. The
initial Conversion Price is $____ per share of Common Stock. The Conversion
Price is subject to adjustment as described in the Indenture. All conversion
price and conversion provision calculations shall be made to the nearest 1/100
of a cent (with 1/200 of a cent being rounded upward) or to the nearest 1/10,000
of a share (with 1/200 of a share being rounded upward), as the case may be.
To convert all or a portion of this Note, a Holder must (a) complete
and sign an irrevocable notice of election to convert substantially in the form
attached hereto as Schedule 1 (the "Conversion Notice") and deliver such
Conversion Notice to the Conversion Agent, (b) surrender the Note to the
Conversion Agent, (c) furnish appropriate endorsements or transfer documents if
required by the Conversion Agent and (d) pay any transfer or similar tax, if
required. Except as provided below, accrued but unpaid interest will not be paid
in cash on Notes that are converted by a Holder into Common Stock, nor will such
accrued interest be converted into additional shares of Common Stock, but such
accrued interest will be deemed to be paid in full and then returned by the
Holder to the Company as partial consideration for the Common Stock received
upon conversion. Holders of Notes at the close of business on a Regular Record
Date will be entitled to receive the interest payable on such Notes (except that
holders of Notes called for redemption on a redemption date between such record
date and the Interest Payment Date shall not be entitled to receive such
interest on such Interest Payment Date) on the corresponding Interest Payment
Date notwithstanding the conversion of such Notes following such Regular Record
Date and prior to such Interest Payment Date. However, Notes surrendered for
conversion during the period between the close of business on any regular record
date and the opening of business on the corresponding Interest Payment Date
(except Notes called for redemption on a redemption date during such period)
must be accompanied by payment of an amount equal to the interest payable on
such Notes on such Interest Payment Date. A Holder of Notes on a Regular Record
Date who (or whose transferee) tenders any such Notes for conversion into shares
of Common Stock on such Interest Payment Date will receive the interest payable
by the Company on such Notes on such date, and the converting Holder need not
<PAGE>
8
include payment of the amount of such interest upon surrender of Notes for
conversion. The Company will make no payment or allowance for dividends on the
shares of Common Stock issued upon conversion.
No fractional shares will be issued upon conversion but a cash payment
shall be made by the Company in lieu of such fractional interest. The
outstanding principal amount of any Note shall be reduced by the principal
amount thereof converted into shares of Common Stock or other shares of common
stock of the Company.
The Company's delivery upon conversion of the fixed number of shares of
Common Stock of the Company into which the Notes are convertible (together with
cash in lieu of fractional shares) shall be deemed to satisfy the Company's
obligation to pay the principal amount at the stated maturity date, or at the
date of redemption, if any Notes are subject to redemption, of the portion of
Notes so converted and any unpaid interest accrued on such Notes at the time of
such conversion.](5)/
Unless otherwise defined in this Note, all terms used in this Note
which are defined in the Indenture shall have the meanings assigned to them in
the Indenture.
THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK.
- -----------------
(5)/ THE BRACKETED LANGUAGE IS TO BE INCLUDED IF THE NOTES ARE TO BE
CONVERTIBLE INTO SHARES OF THE COMPANY'S COMMON STOCK.
<PAGE>
Schedule 1
NOTICE OF ELECTION TO CONVERT
If you want to elect to have all Notes represented by this Note
converted by the Company into _____ shares of common stock, par value $1.00 per
share, of the Company pursuant to Section 16.3 of the Indenture, please check
the box below:
/ / Convert all Notes represented by this Note pursuant to
Section 16.3
If you want to elect to have only part Notes represented by this Note
converted by the Company into _____ shares of common stock, par value $1.00 per
share, of the Company pursuant to Section 16.3 of the Indenture, state the
amount you elect to have converted:
$
-----------
Your Signature:
------------------------
(SIGN EXACTLY AS YOUR NAME APPEARS
ON THE FACE OF THIS NOTE)
Tax Identification No.:
----------------
Date:
----------------------------------
Signature Guarantee:
------------------
<PAGE>
Exhibit 4.15
FORM OF
CERTIFICATE OF DESIGNATIONS, POWERS,
PREFERENCES AND RIGHTS
OF THE
____ %[CONVERTIBLE] [CUMULATIVE] PREFERRED STOCK, SERIES _
($__.00 initial liquidation preference per share)
OF
POLAROID CORPORATION
--------------------------------
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
--------------------------------
POLAROID CORPORATION, a Delaware corporation (the
"Corporation"), HEREBY CERTIFIES that resolutions were duly adopted by the Board
of Directors of the Corporation (the "Board of Directors") pursuant to the
authority conferred upon the Board of Directors by the provisions of the
Restated Certificate of Incorporation of the Corporation, as amended (the
"Restated Certificate of Incorporation"), and/or by an officer of the
Corporation pursuant to authority duly conferred on him or her, as the case may
be, by the Board of Directors (each, an "Authorized Officer") as follows:
RESOLVED, that the Corporation be, and it hereby is,
authorized to offer, issue and sell preferred stock, par value $1.00, with a
liquidation preference, in the aggregate, of up to $___,000,000 (the "Preferred
Stock") in one or more series, on such terms, and with such designations,
preferences, relative, participating, optional, redemption, exchange or other
special rights, and such dividend periods, method of determining dividend rates
and such other terms and conditions as the Board of Directors and/or an
Authorized Officer, as the case may be, may approve; PROVIDED, HOWEVER, that the
Board of Directors shall have no power or authority to alter the voting rights
of the Preferred Stock as set forth in these resolutions; and be it further
RESOLVED, that the designations, preferences, relative,
participating, optional, redemption, exchange or other special rights, and
dividend periods, method of determining dividend rates and such other terms and
conditions are hereby established as follows:
<PAGE>
2
1. DESIGNATION AND AMOUNT; FRACTIONAL SHARES. The Board of
Directors and an Authorized Officer have authorized the issuance of a series of
preferred stock designated as the "_____ % [Cumulative] Preferred Stock, Series
_" (the "Series _ Preferred Stock"). The Series _ Preferred Stock shall be
perpetual and the authorized number of shares of Series _ Preferred Stock shall
be _____ million (__,000,000) shares. The Series _ Preferred Stock is issuable
in whole shares only. The form of certificate of the Series __ Preferred Stock
is attached hereto as Exhibit A.
2. DIVIDENDS. Holders of shares of Series _ Preferred Stock
shall be entitled to receive, when, as and if declared by the Board of Directors
or a duly authorized committee thereof out of assets of the Corporation legally
available for payment, [cumulative] cash dividends at the rate of ____% per
annum per share on the initial liquidation preference of $____ per share.
Dividends on the Series_ Preferred Stock shall be payable quarterly, in arrears
on _____, _____, ______, and ______ of each year, commencing _____, ____ (each a
"Dividend Payment Date"). If any date on which dividends would otherwise be
payable shall be or be declared a national or New York State holiday, or if
banking institutions in the State of New York shall be closed because of a
banking moratorium or otherwise on such date, then the Dividend Payment Date
shall be the next succeeding day on which such banks shall be open. Dividends on
shares of the Series _ Preferred Stock [shall be fully cumulative and] shall
accumulate (whether or not earned or declared), on a daily basis, without
interest, from the previous Dividend Payment Date, except that the first
dividend shall accumulate, without interest, from the date of initial issuance
of the Series _ Preferred Stock. Accumulated and unpaid dividends shall not bear
interest. Dividends shall be payable, in arrears, to holders of record as they
appear on the stock books of the Corporation on each record date, which shall be
the 15th day immediately preceding each such Dividend Payment Date (each of
which dates being a "Dividend Payment Record Date"). Dividends payable on the
Series _ Preferred Stock for the first dividend period and any partial dividend
period shall be computed on the basis of a 360 day year consisting of twelve
30-day months. Dividends shall cease to accumulate on the Series _ Preferred
Stock on the date of their earlier redemption pursuant to Section 6 below,
unless the Corporation shall default in providing funds for the payment of
redemption price on the shares called for redemption pursuant thereto.]
No dividends may be declared or paid or set apart for payment
on any Parity Preferred Stock (as defined in Section 8 below), with regard to
the payment of dividends unless there shall also be or have been declared and
paid or set apart for payment on the Series _ Preferred Stock, dividends for all
dividend payment periods of the Series _ Preferred Stock ending on or before the
dividend payment date of such Parity Preferred Stock, ratably in proportion to
the respective amounts of dividends (x) [accumulated and] unpaid or payable on
such Parity Preferred Stock, on the one hand, and (y) [accumulated and] unpaid
through the dividend payment period or periods of the Series _ Preferred Stock
next preceding such dividend payment date, on the other hand.
Except as set forth in the preceding sentence, unless full
[cumulative] dividends on the Series _ Preferred Stock have been paid through
the most recently completed quarterly dividend period for the Series _ Preferred
Stock, dividends (other than in common stock of the
<PAGE>
3
Corporation) 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 Series _ 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 Series _ Preferred Stock as to
dividends be redeemed, purchased or otherwise acquired for any consideration (or
any payment be made to or available for a sinking fund for the redemption of any
shares of such stock; PROVIDED, HOWEVER, that any moneys theretofore deposited
in any sinking fund with respect to any preferred stock of the Corporation in
compliance with the provisions of such sinking fund may thereafter be applied to
the purchase or redemption of such preferred stock in accordance with the terms
of such sinking fund, regardless of whether at the time of such application full
[cumulative] dividends upon shares of Series _ Preferred Stock outstanding to
the last dividend payment date shall have been paid or declared and set apart
for payment) by the Corporation; PROVIDED that any such junior or parity stock
or common stock may be converted into or exchanged for stock of the Corporation
ranking junior to the Series _ Preferred Stock as to dividends.
3. LIQUIDATION PREFERENCE. The shares of Series _ Preferred
Stock shall rank, as to liquidation, dissolution or winding up of the
Corporation, prior to the shares of common stock and any other stock of the
Corporation ranking junior to the Series _ Preferred Stock as to rights upon
liquidation, dissolution or winding up of the Corporation, so that in the event
of any liquidation, or winding up of the Corporation, whether voluntary or
involuntary, the holders of the Series _ 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 $_____ per share (the "Liquidation Preference" of a share of
Series _ Preferred Stock) plus an amount equal to all dividends (whether or not
earned or declared) accrued and accumulated and unpaid on the shares of Series _
Preferred Stock to the date of final distribution. The holders of the Series _
Preferred Stock shall not be entitled to receive the Liquidation Preference
until the liquidation preference of any other stock of the Corporation ranking
senior to the Series _ Preferred Stock as to rights upon liquidation,
dissolution or winding up shall have been paid (or a sum set aside therefor
sufficient to proceeds for payment) in full. After payment of the full amount of
the Liquidation Preference and such dividends, the holders of shares of Series _
Preferred Stock will not be entitled to any further participation in any of
assets by the Corporation. If, upon any liquidation, dissolution or winding up
of the Corporation, the assets of the Corporation, or provide thereof,
distributable among the holders of shares of Parity Preferred Stock shall be
insufficient to pay in full the preferential amount aforesaid, 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, neither
a consolidation or merger of the Corporation with or into any other corporation,
nor a merger of any other corporation with or into the Corporation, nor a sale
or transfer of all or any part of the Corporation's assets shall be considered a
liquidation, dissolution or winding up of the Corporation.
4. [CONVERSION.
<PAGE>
4
(a) CONVERSION RIGHT AND PRICE. Subject to and upon compliance
with the provisions of this Section 4, each holder of Series __ Preferred Stock
shall have the right, at each such holder's option, at any time, to convert any
or all of the shares of Series __ Preferred Stock held by each such holder into
the number of fully paid and non-assessable shares of Common Stock (calculated
as to each conversion, for the purpose of determining the amount of any cash
payments provided for under subsection (c) of this Section 4, to the nearest
1/100 of a share of Common Stock, with 1/200 of a share of Common Stock being
rounded upward) obtained by dividing the liquidation preference of a share of
Series __ Preferred Stock by the Conversion Price (as defined below) and
multiplying such resulting number by the number of shares of Series __ Preferred
Stock to be converted, and by surrender of such shares of Series __ Preferred
Stock so to be converted, such surrender to be made in the manner provided in
subsection (b) of this Section 4; PROVIDED, HOWEVER, that the right to convert
shares called for redemption pursuant to Section 6 shall terminate at the close
of business on the date fixed for such redemption unless the Corporation shall
default in making payment of the amount payable upon such redemption.
For purposes of this Section 4, the term "Common Stock" shall
(1) mean the Common Stock of the Corporation, par value $1.00 per share, as the
same exists at the date of this Certificate of Designations, Powers, Preferences
and Rights (this "Certificate of Designations") or as such stock may be
constituted from time to time, except that for purposes of subsection (e) of
this Section 4, and (2) 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 $_____, as adjusted in
accordance with the provisions of this Section 4.
(b) CONVERSION PROCEDURES; SURRENDER; ETC. In order to
exercise the conversion privilege of this Section 4, the holder of each share of
Series __ Preferred Stock to be converted shall surrender the certificate
representing such share at the office of the Conversion Agent for the Series __
Preferred Stock in the Borough of Manhattan, the City of New York, New York,
appointed for such purpose by the Corporation, with the Notice of Election to
Convert on the back of such 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 Series __ Preferred Stock is registered, each share surrendered
for conversion shall be accompanied by instruments of transfer, in form
satisfactory to the Corporation, duly executed by the holder or the holder's
duly authorized attorney, and by an amount sufficient to pay any transfer or
similar tax.
The holders of shares of Series __ Preferred Stock at the
close of business on a Dividend Payment Record Date shall be entitled to receive
the dividend payable on such shares (except that holders of shares called for
redemption on a redemption date between such record date and the Dividend
Payment Date shall not be entitled to receive such dividend on such Dividend
Payment Date) on the corresponding Dividend Payment Date, notwithstanding the
conversion thereof or the Corporation's default in payment of the dividend due
on such Dividend Payment Date. However, shares of Series __ Preferred Stock
surrendered for conversion during
<PAGE>
5
the period between the close of business on any Dividend Payment Record Date and
the opening of business on the corresponding Dividend Payment Date (except
shares called for redemption on a redemption date during such period) must be
accompanied by payment of an amount equal to the dividend payable on such shares
on such Dividend Payment Date. A holder of shares of Series __Preferred Stock on
a Dividend Payment Record Date who (or whose transferee) tenders any of such
shares for conversion into shares of Common Stock on a Dividend Payment Date
will receive the dividend payable by the Corporation on such shares of Series __
Preferred Stock on such date, and the converting holder need not include payment
in the amount of such dividend upon surrender of shares of Series __ Preferred
Stock for conversion. Except as provided above, the Corporation shall make no
payment or allowance for unpaid dividends, whether or not in arrears, on
converted shares or for dividends on the shares of Common Stock issued upon such
conversion.
As promptly as practicable after the surrender of the
certificates for shares of Series __ Preferred Stock as aforesaid, the
Corporation shall issue and shall deliver at the office of the Conversion Agent
to such holder, or on such holder's 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 Section 4, and any
fractional interest in respect of a share of Common Stock arising upon such
conversion shall be settled as provided in subsection (c) of this Section 4.
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 Series __ Preferred Stock shall have been surrendered and such
notice (and, if applicable, payment of an amount equal to the dividend payable
on such shares) 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 such 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 (and, if
applicable, payment) received by the Corporation. All shares of Common Stock
delivered upon conversion of the Series __ Preferred Stock will upon delivery be
duly and validly issued and fully paid and non-assessable, free of all liens and
charges and not subject to any preemptive rights.
(c) In connection with the conversion of any shares of Series
__ Preferred Stock, no fractional shares or scrip representing fractions of
shares of Common Stock shall be issued upon conversion of Series __ 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 Series __ Preferred
Stock or a fraction thereof, the Corporation shall pay to the holder of such
share of Series __ Preferred Stock or fraction thereof an amount in cash
(computed to the nearest cent, with one-half cent being rounded upward) equal to
the reported last sale price (as defined in
<PAGE>
6
paragraph (d)(ii) of this Section 4) of the Common Stock on the Trading Day (as
defined in paragraph (d)(ii) of this Section 4) next preceding the day of
conversion multiplied by the fraction of a share of Common Stock represented by
such fractional interest. If more than one share of Series __ Preferred Stock
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
Series __ Preferred Stock so surrendered.
(d) CONVERSION PRICE ADJUSTMENT. The Conversion Price shall be
adjusted from time to time as follows:
(i) In case the Corporation shall (x) pay a dividend or make a
distribution on the Common Stock in shares of Common Stock, (y)
subdivide the outstanding Common Stock into a greater number of shares
or (z) combine the outstanding Common Stock into a smaller number of
shares, the Conversion Price shall be adjusted so that the holder of
any share of Series __ Preferred Stock thereafter surrendered for
conversion shall be entitled to receive the number of shares of Common
Stock of the Corporation which such holder would have owned or have
been entitled to receive after the happening of any of the events
described above had such share been converted immediately prior to the
Dividend Payment Record Date in the case of a dividend or the effective
date in the case of subdivision or combination. An adjustment made
pursuant to this paragraph (i) shall become effective immediately after
the Dividend Payment Record Date in the case of a dividend, except as
provided in paragraph (v) below, and shall become effective immediately
after the effective date in the case of a subdivision or combination.
(ii) For the purpose of any computation pursuant to this
Section 4, the current market price per share of Common Stock on any
date shall be deemed to be the average of the reported last sale prices
for the 30 consecutive Trading Days (as defined below) commencing 45
Trading Days before the date in question. The reported last sale price
for each day (for purposes of paragraph (c)) shall be the reported last
sale price, regular way, or, in case no sale takes place on such day,
the average of the reported closing bid and asked prices, regular way,
in either case as reported on the New York Stock Exchange Composite
Tape.
As used herein, the term Trading Day with respect to
Common Stock means (x) if the Common Stock is listed or admitted for
trading on the New York Stock Exchange or another national securities
exchange, a day on which the New York Stock Exchange or such other
national securities exchange is open for business, (y) if the Common
Stock is quoted on the National Market System of NASDAQ, a day on which
trades may be made on such National Market System or (z) otherwise, any
day other than a Saturday or Sunday or a day on which banking
institutions in the State of New York are authorized or obligated by
law or executive order to close.
(iii) No adjustment in the Conversion Price shall be required
unless such adjustment would require an increase or decrease of at
least 1% in such price; PROVIDED,
<PAGE>
7
HOWEVER, that any adjustments which by reason of this paragraph (iii)
are not required to be made shall be carried forward and taken into
account in any subsequent adjustment; and PROVIDED FURTHER that
adjustment shall be required and made in accordance with the provisions
of this Section 4 (other than this paragraph (iii)) not later than such
time as may be required in order to preserve the tax free nature of a
distribution to the holders of Common Stock. All calculations under
this Section 4 shall be made to the nearest cent or to the nearest
1/100 of a share, as the case may be, with one-half cent and 1/200 of a
share, respectively, being rounded upward. Anything in this subsection
(d) to the contrary notwithstanding, the Corporation shall be entitled
to make such reductions in the Conversion Price, in addition to those
required by this subsection (d), as it in its discretion shall
determine to be advisable in order that any stock dividend, subdivision
of shares, or distribution of other assets (other than cash dividends)
hereafter made by the Corporation to its shareholders shall not be
taxable.
(iv) Whenever the Conversion Price is adjusted as herein
provided, the Corporation shall promptly file with the Conversion Agent
an officers' certificate, signed by the Chairman, the President or any
Vice President, and by the Treasurer, an Assistant Treasurer, the
Secretary, or an Assistant Secretary of the Corporation, setting forth
the Conversion Price after such adjustment and setting forth a brief
statement of the facts requiring such adjustment, which certificate
shall be conclusive evidence of the correctness of such adjustment.
Promptly after delivery of such certificate, the Corporation shall
prepare a notice of such adjustment of the Conversion Price setting
forth the adjusted Conversion Price and the date on which such
adjustment becomes effective and shall mail such notice of such
adjustment of the Conversion Price to the holders of shares of Series
__ Preferred Stock at their addresses as shown on the stock books of
the Corporation.
(v) In any case in which this subsection (d) provides that an
adjustment shall become effective immediately after a record date for
an event, the Corporation may defer until the occurrence of such event
(x) issuing to the holder of any share of Series __ Preferred Stock
converted after such record date and before the occurrence of such
event the additional shares of Common Stock issuable upon such
conversion by reason of the adjustment required by such event over and
above the Common Stock issuable upon such conversion before giving
effect to such adjustment and (y) paying to such holder any amount in
cash in lieu of any fractional share of Common Stock pursuant to
subsection (c) of this Section 4.
(e) If:
(i) the Corporation shall declare a dividend (or any
other distribution) on the Common Stock (other than
in cash out of retained earnings);
(ii) there shall be any reclassification or change of the
Common Stock (other than a subdivision or combination
of the outstanding Common Stock and
<PAGE>
8
other than a change in the par value or from par
value to no par value or from no par value to par
value), or any consolidation, merger, or statutory
share exchange to which the Corporation is a party
and for which approval of any shareholders of the
Corporation is required, or any sale or transfer of
all or substantially all the assets of the
Corporation as an entirety or any Fundamental Change;
or
(iii) there shall be a voluntary or involuntary
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 Series __ 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 (x) the
date on which a record is to be taken for the purpose of such dividend,
distribution, or granting of rights or warrants, or, if a record is not to be
taken, the date as of which the holders of Common Stock of record to be entitled
to such dividend, distribution, or rights or warrants are to be determined, or
(y) the date on which such reclassification, change, consolidation, merger,
statutory share exchange, sale, transfer, Fundamental Change, 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 reclassification, change, consolidation, merger, statutory
share exchange, sale, transfer, Fundamental Change, 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 subsection (h) of this
Section 4 or in paragraph (d)(i) of this Section 4.
The term "Fundamental Change" means the occurrence of any
transaction or event in connection with which all or substantially all the
Common Stock shall be exchanged for, converted into, or acquired for, or shall
constitute solely the right to receive, cash, securities, property, or other
assets (whether by means of an exchange offer, liquidation, tender offer,
consolidation, merger, combination, reclassification, recapitalization or
otherwise). In the case of a plan involving more than one such transaction or
event, for purposes of adjustment of the Conversion Price, such Fundamental
Change shall be deemed to have occurred when substantially all the Common Stock
shall have been exchanged for, converted into, or acquired for, or shall
constitute solely the right to receive, such cash, securities, property, or
other assets, but the adjustment shall be based upon the consideration that the
holders of Common Stock received in the transaction or event as a result of
which more than 50% of the Common Stock shall have been exchanged for, converted
into, or acquired for, or shall constitute solely the right to receive, such
cash, securities, property, or other assets.
(f) COVENANTS AND AGREEMENTS. (i) 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, for the purpose of effecting conversions of the Series __
Preferred Stock, the full number of shares of Common Stock deliverable upon the
conversion of all outstanding shares of Series __ Preferred Stock not
theretofore converted. For
<PAGE>
9
purposes of this subsection (f), the number of shares of Common Stock which
shall be deliverable upon the conversion of all outstanding shares of Series __
Preferred Stock shall be computed as if at the time of computation all such
outstanding shares were held by a single holder.
(ii) Before taking any action which would cause any
adjustment reducing the Conversion Price below the
then par value, if any, of the shares of Common Stock
deliverable upon conversion of the Series __
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
non-assessable shares of Common Stock at such
adjusted Conversion Price.
(iii) The Corporation will endeavor to list the shares of
Common Stock required to be delivered upon conversion
of the Series __ 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.
(iv) Prior to the delivery of any securities which the
Corporation shall be obligated to deliver upon
conversion of the Series __ 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.
(g) TAXES. The Corporation will pay any and all documentary
stamp or similar issue or transfer taxes payable in respect of the issue or
delivery of shares of Common Stock on conversions of the Series __ 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 Series __ 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.]
[RWW: THIS CONVERSION SECTION CAME FROM A CERTIFICATE OF
DESIGNATION OF FIDELITY NATIONAL FINANCIAL AND IS ONE OF THE MORE SIMPLE ONES WE
FOUND, ALTHOUGH IT APPEARS TO BE VERY LONG. WE DELETED CERTAIN SUBSTANTIVE AND
RELATED PROCEDURAL PROVISIONS RELATING TO RECLASSIFICATIONS, MERGERS OR OTHER
FUNDAMENTAL CHANGES BASED ON THE ASSUMPTION THAT (1) LIKE THE SUPPLEMENTAL
INDENTURE, THIS FORM DOCUMENT WAS MEANT TO BE BARE BONES AND (2) THE CONVERSION
RIGHTS OF A SPECIFIC SERIES OF CONVERTIBLE PREFERRED STOCK WILL BE NEGOTIATED
BEFORE THEIR UNDERWRITING OR SALE. THE PRIMARY SECTION THAT WE DELETED IS TABBED
IN THE MODEL WHICH IS ATTACHED HERETO.]
<PAGE>
10
5. VOTING RIGHTS. The Series _ Preferred Stock, except as
provided herein or as otherwise from time to time required by law, shall have no
voting rights. Whenever, at any time or times, dividends payable on the shares
of Series _ Preferred Stock or on any Parity Preferred Stock shall be in arrears
for an aggregate number of days equal to [six] calendar quarters or more,
whether or not consecutive, the authorized number of directors of the
Corporation shall automatically be increased by [two] and the holders of the
Series _ Preferred Stock shall have the right, with holders of shares of any one
or more other classes or series of Parity Preferred Stock outstanding at the
time upon which like voting rights have been conferred and are exercisable
("Voting Parity Stock"), voting together as a class, to elect [two] directors
(hereinafter the"Preferred Directors" and each a "Preferred Director") to fill
such newly created directorships at the Corporation's next annual meeting of
stockholders and at each subsequent annual meeting of stockholders until such
arrearages have been paid or set aside for payment, at which time such right
shall terminate, except as herein or by law expressly provided, subject to
revesting in the event of each and every subsequent default of the character
above mentioned. Upon any termination of the right of the holders of shares of
Series _ Preferred Stock and Voting Parity Stock as a class to vote for
directors as provided above, the term of office of all Preferred Directors then
in office shall terminate immediately and the authorized number of directors
shall be reduced by the number of Preferred Directors elected pursuant hereto.
Any Preferred Director may be removed at any time, with or without cause. Any
vacancy created thereby may be filled only by the affirmative vote of the
holders of shares of Series _ Preferred Stock voting separately as a class
(together with the holders of shares of Voting Parity Stock). If the office of
any Preferred Director becomes vacant for any reason other than removal from
office as aforesaid, the remaining Director may choose a successor who shall
hold office for the unexpired term in respect of which such vacancy occurred. At
elections for such directors, each holder of shares of Series _ Preferred Stock
shall be entitled to one vote for each share held; the holders of shares of any
other class or Series of Voting Parity Stock being entitled to such number of
votes, if any, each share of such stock held as may be granted to them.
So long as any shares of any Series _ Preferred Stock remain
outstanding, the Corporation shall not, without the affirmative vote of the
holders of at least a majority of the shares of such Series _ Preferred Stock
(i) authorize, create or issue any capital stock of the Corporation ranking, as
to dividends or upon liquidation, dissolution or winding up, prior to such
Series _ Preferred Stock, or reclassify any authorized capital stock of Polaroid
into any such shares of such capital stock or issue any obligation or security
convertible into or evidencing the right to purchase any such shares of capital
stock, or (ii) amend, alter or repeal this Certificate of Designations for such
Series _ Preferred Stock, or the Restated Certificate of Incorporation, whether
by merger, consolidation or otherwise, so as to adversely affect the powers,
preferences or special rights of such Series _ Preferred Stock. Any increase in
the amount of authorized common stock or authorized preferred stock, or any
increase or decrease in the number of shares of any series of preferred stock or
the authorization, creation and issuance of other classes or series of common
stock or other stock, in each case ranking on a parity with or junior to the
shares of Series _ Preferred Stock with respect to the payment of dividends and
the distribution of assets upon liquidation, or winding up, shall not be deemed
to adversely affect such powers, preferences or special rights.
<PAGE>
11
The foregoing voting provisions shall not apply if, at or
prior to the time when the act with respect to which such vote would otherwise
be required or upon which the holders of Series _ Preferred Stock shall be
entitled to vote shall be effected, all outstanding shares of Series _ Preferred
Stock shall have been redeemed or called for redemption and sufficient funds
shall have been deposited in trust to effect such redemption.
6. REDEMPTION. The shares of Series _ Preferred Stock shall
not be redeemable prior to _________, ____ on and after such date, the
Corporation, at its option, may redeem shares of the Series _ Preferred Stock,
as a whole or in part, at any time or from time to time, at a redemption price
equal to $____ per share, plus, in each case, an amount equal to all dividends
(whether or not earned or declared) and accumulated and unpaid to, but
excluding, the date fixed for redemption.
The holders of shares of Series _ Preferred Stock at the close
of business on a Dividend Payment Record Date shall be entitled to receive the
dividend payable on such shares on the corresponding Dividend Payment Date
notwithstanding the call for redemption thereof (except that holders of shares
called for redemption on a date occurring between such Record Date and the
Dividend Payment Date shall not be entitled to receive such dividend on such
Dividend Payment Date) or the Corporation's default in payment of the dividend
due on such Dividend Payment Date.
In the event that fewer than all the outstanding shares of
Series _ Preferred Stock are to be redeemed, the number of shares to be redeemed
shall be determined by the Board of Directors and the shares to be redeemed
shall be selected pro rata (as nearly as may be practicable without creating
fractional shares) or by any other means determined by the Board of Directors in
its sole discretion to be equitable, except the Corporation may redeem all
shares held by any holders of a number of shares not to exceed 100, including
all shares held by holders who, after giving effect to such redemption, would
hold less than 100 shares, as may be specified by the Corporation.
If full [cumulative] dividends on the Series _ Preferred Stock
have not been paid, the Series _ Preferred Stock may not be redeemed in part and
the Corporation may not purchase or acquire any shares of the Series _ Preferred
Stock otherwise than pursuant to a purchase or exchange offer made on the same
terms to all holders of the Series _ Preferred Stock.
In the event the Corporation shall redeem shares of Series _
Preferred Stock, written notice of such redemption shall be given by first class
mail, postage prepaid, mailed not less than 30 days nor more than 60 days prior
to the redemption date, to each holder of record of the shares to be redeemed at
such holder's address as the same appears on the stock books of the Corporation;
PROVIDED, HOWEVER, that no failure to give such notice nor any defect therein
shall affect the validity of the proceeding for the redemption of any shares of
Series _ Preferred Stock to be redeemed except as to the holder to whom the
Corporation has failed to mail said notice or except as to the holder whose
notice was defective. Each such notice shall state: (a) the redemption date; (b)
the number of shares of Series _ Preferred Stock to be redeemed and, if less
than all the shares held by such holder are to be redeemed from such holder, the
number of shares
<PAGE>
12
to be redeemed from such holder; (c) the redemption price and any number of
[accumulated and] unpaid dividends to the redemption date; (d) the place or
places where certificates for such shares are to be surrendered for payment of
the redemption price; and (e) that dividends on the shares to be redeemed will
cease to accrue on such redemption date (unless the Corporation shall default in
providing funds for the payment of the redemption price of the shares called for
redemption at the time and place specified in such notice).
If a notice of redemption has been given pursuant to this
Paragraph 6 and if, on or before the date fixed for redemption, the funds
necessary for such redemption shall have been set aside by the Corporation,
separate and apart from its other funds, in trust for the pro rata benefit of
the holders of the shares of Series _ Preferred Stock so called for redemption,
then, notwithstanding that any certificates for such shares have not been
surrendered for cancellation, on the redemption date dividends shall cease to
accrue on the shares to be redeemed, and at the close of business on the
redemption date the holders of such shares shall cease to be stockholders with
respect to such shares and shall have no interest in or claims against the
Corporation by virtue thereof and shall have no voting or other rights with
respect to such shares, except the right to receive the moneys payable upon
surrender (and endorsement, if required by the Corporation) of their
certificates, and the shares evidenced thereby shall no longer be outstanding.
The Corporation's obligation to provide funds for the payment of the redemption
price (and any [accumulated and] unpaid dividends to the redemption date) of the
shares called for redemption shall be deemed fulfilled if, on or before a
redemption date, the Corporation shall deposit, with a bank or trust company, or
an affiliate of a bank or trust company, having an office or agency in New York
City and having a capital and surplus of at least $50,000,000, such funds
sufficient to pay the redemption price (and any [accumulated and] unpaid
dividends to the redemption date) of the shares called for redemption, in trust
for the account of the holders of the shares to be redeemed (and so as to be and
continue to be available therefor), irrevocable instructions and authority to
such bank or trust company that such funds be delivered upon redemption of the
shares of Series _ Preferred Stock so called for redemption.
Subject to applicable escheat laws, any moneys so set aside by
the Corporation and unclaimed at the end of two years from the redemption date
shall revert to the general funds of the Corporation, after which reversion the
holders of such shares so called for redemption shall look only to the general
funds of the Corporation for the payment of the amounts payable upon such
redemption. Any interest accrued on funds so deposited shall be paid to the
Corporation from time to time.
Shares of Series _ Preferred Stock that have been issued and
reacquired in any manner, including shares purchased or redeemed, shall (upon
compliance with any applicable provisions of the laws of the State of Delaware)
have the status of authorized and unissued shares of the class of Preferred
Stock undesignated as to series and may be redesignated and reissued as part of
any series of the preferred stock.
7. AMENDMENT OF RESOLUTION. The Board of Directors reserves
the right by from time to time to increase or decrease the number of shares that
constitute the Series _ Preferred Stock (but not below the number of shares
thereof then outstanding) and in other
<PAGE>
13
respects to amend this Certificate of Designations within the limitations
provided by law, this resolution and the Restated Certificate of Incorporation.
8. RANK. Any stock of any class or classes or series of the
Corporation be deemed to rank:
(a) prior to shares of the Series _ Preferred
Stock, either as to dividends or upon liquidation, dissolution or winding up, or
both, if the holders of stock of such class or classes or series shall be
entitled by the terms thereof to the receipt of dividends or of amounts
distributable upon liquidation, dissolution or winding up, as the case may be,
in preference or priority to the holders of shares of the Series _ Preferred
Stock;
(b) on a parity with shares of the Series _
Preferred Stock, either as to dividends or upon liquidation, dissolution or
winding up, or both, whether or not to the dividend rates, dividend payment
dates, or redemption or liquidation prices per share thereof be different from
those of the Series _ Preferred Stock, if the holders of stock of such class or
classes shall be entitled by the terms thereof to the receipt of dividends or of
amounts distributed upon liquidation, dissolution or winding up, as the case may
be, in proportion to their respective dividend rates or liquidation prices,
without preference or priority of one over the other as between the holders of
such stock and the holders of shares of Series _ Preferred Stock; (the term
"Parity Preferred" being used to refer to any stock on a parity with the shares
of Series _ Preferred Stock, either as to dividend or upon liquidation
dissolution or winding up, or both, as the content may require; and
(c) junior to shares of the Series _ Preferred
Stock, either as to dividends or upon liquidation, dissolution or winding up, or
both, if such class or classes or series shall be common stock or if the holders
of the Series _ Preferred Stock shall be entitled to the receipt of dividends or
of amounts distributable upon liquidation, dissolution or winding up, as the
case may be, in preference or priority to the holders of stock of such class or
classes or series.
The Series __ Preferred Stock will rank, as to dividends and
upon liquidation, dissolution or winding up, prior to the Corporation's common
stock, par value $1.00, and the Corporation's Series A Preferred Stock.
IN WITNESS WHEREOF, the Corporation has caused this
Certificate to be duly executed on its behalf by its undersigned [Treasurer] and
attested to by its [Secretary] this___ day of _____, ____.
By:
--------------------------
Name:
Title: [Treasurer]
Attest:
-----------------------
Name:
<PAGE>
14
Title: [Secretary]
<PAGE>
Exhibit A
POLAROID CORPORATION
__%[Convertible][Cumulative] Preferred Stock, Series __
Cusip No.: Shares
-------------- -----------
THIS CERTIFIES THAT __________________________________________
is the owner of fully paid and non-assessable shares of ____%
[Convertible][Cumulative] Preferred Stock, Series ___, par value $1.00 per
share, of POLAROID CORPORATION, a corporation incorporated under the laws of
Delaware (the "Corporation"), transferable on the books of the Corporation by
the holder hereof in person or by its duly authorized attorney, upon surrender
of this Certificate properly endorsed. This Certificate and the shares
represented hereby are issued and shall be held subject to all of the provisions
of the Certificate of Designations, Powers, Preferences and Rights of the __%
[Convertible] [Cumulative] Preferred Stock, Series __, the Restated Certificate
of Incorporation of the Corporation, as amended, and the By-laws of the
Corporation and any amendments or restatements thereto. This Certificate is not
valid unless countersigned and registered by the Transfer Agent and Registrar.
IN WITNESS WHEREOF, the Corporation has caused this Certificate to be
executed on its behalf by its duly authorized officers.
POLAROID CORPORATION
By:
-------------------------------
Name:
Title:
Countersigned and Registered:
- ----------------------------
Transfer Agent and Registrar
By:
------------------------,
Authorized signatory
Dated:
----------------------
<PAGE>
2
The Corporation will furnish without charge to each
stockholder who so requests a description of the powers, designations,
preferences and relative, participating, optional or other special rights, and
the qualifications, limitations or restrictions, of each class of capital stock
or series thereof which the corporation is authorized to issue. Such request
should be directed to the office of the Secretary of the Corporation, 784
Memorial Drive, Cambridge, Massachusetts 02139, telephone number: (781)
386-2000.
---------------------------------
KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN OR DESTROYED,
THE CORPORATION WILL REQUIRE A BOND OF INDEMNITY AS A CONDITION TO
THE ISSUANCE OF A REPLACEMENT CERTIFICATE.
---------------------------------
The following abbreviations, when used in the inscription on
the face of this Certificate, shall be construed as though they were written out
in full according to applicable laws or regulations:
<TABLE>
<S> <C>
TEN COM -- as tenants in common UNIF GIFT MIN ACT (Custodian)
--------------- ---------------
(Custodian) (Minor)
TEN ENT -- as tenants by the entireties under Uniform Gifts to Minors Act of
------------
(State)
JT TEN -- as joint tenants with right of
survivorship and not as tenants
in common
</TABLE>
Additional abbreviations may also be used though not in the above list.
<PAGE>
3
ASSIGNMENT FORM
FOR VALUE RECEIVED, __________________________________________
HEREBY SELL, ASSIGN AND TRANSFER UNTO
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF
ASSIGNEE
- ----------------------------------------
- ----------------------------------------
- ------------------------------------------------------------------------------
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)
____________________________ shares of ____% [Convertible] [Cumulative]
Preferred Stock Series ____ of the Corporation represented by this Certificate
and do hereby irrevocably constitute and appoint __________________ Attorney to
transfer the said shares of ____% [Convertible] [Cumulative] Preferred Stock,
Series ____ on the books of the Corporation, with full power of substitution in
the premises.
Dated:
------------------------
Signature:
----------------------------------------------
NOTICE: The signature to this assignment must
correspond with the name as written upon the
face of the certificate in every particular,
without alteration or enlargement or any change
whatever.
Signature(s) Guaranteed:
By:
---------------------
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION,
(BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS) WITH
MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO
S.E.C. RULE 17AD-15.
<PAGE>
4
NOTICE OF ELECTION TO CONVERT
If you want to elect to have all of the shares of Series __
Preferred Stock represented by this Certificate converted by the Company into
_____ shares of common stock, par value $1.00 per share, of the Company pursuant
to Section 4(a) of the Certificate of Designations, please check the box below:
/ / Convert all shares of Series ___ Preferred Stock pursuant
to Section 4(a)
If you want to elect to have only part of the shares of Series
__ Preferred Stock represented by this Certificate converted by the Company into
_____ shares of common stock, par value $1.00 per share, of the Company pursuant
to Section 4(a) of the Certificate of Designations, state the amount you elect
to have converted:
$ .
------------
Your Signature
----------------------------
(SIGN EXACTLY AS YOUR NAME APPEARS ON THE
FACE OF THIS NOTE)
Tax Identification No.:
------------------
Date:
------------------------------------
Signature Guarantee:
--------------
<PAGE>
Exhibit 4.16
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
DEPOSIT AGREEMENT
by and among
POLAROID CORPORATION,
, As Depositary
---------------
and
THE HOLDERS FROM TIME TO TIME OF
THE DEPOSITARY RECEIPTS DESCRIBED HEREIN
____% [Convertible][Cumulative] Preferred Stock, Series ____
---------------
Dated
----------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
ARTICLE II
FORM OF RECEIPTS, DEPOSIT OF PREFERRED STOCK, EXECUTION AND DELIVERY,
REDEMPTION OF RECEIPTS, TRANSFER, SPLIT-UPS AND COMBINATIONS,
SURRENDER, LOST RECEIPTS, CANCELLATION AND CONVERSION
<TABLE>
<CAPTION>
PAGE
<S> <C>
SECTION 2.01. Form and Transfer of Receipts.............................................................2
SECTION 2.02. Deposit of Preferred Stock; Execution and Delivery of Receipts in Respect
Thereof..............................................................................3
SECTION 2.03. Redemption of Preferred Stock.............................................................4
SECTION 2.04. Registration of Transfer of Receipts......................................................5
SECTION 2.05. Split-ups and Combinations of Receipts; Surrender of Receipts and
Withdrawal of Preferred Stock........................................................5
SECTION 2.06. Limitations on Execution and Delivery, Transfer, Surrender and Exchange of
Receipts.............................................................................6
SECTION 2.07. Lost Receipts, etc........................................................................6
SECTION 2.08. Cancellation and Destruction of Surrendered Receipts......................................6
SECTION 2.09 Conversion of Preferred Stock into Common Stock...........................................6
ARTICLE III
CERTAIN OBLIGATIONS OF HOLDERS OF RECEIPTS AND THE COMPANY
SECTION 3.01. Filing Proofs, Certificates and Other Information.........................................8
SECTION 3.02. Payment of Taxes or Other Governmental Charges............................................8
SECTION 3.03. Warranty as to Preferred Stock............................................................9
ARTICLE IV
THE DEPOSITED SECURITIES; NOTICES
SECTION 4.01. Cash Distributions........................................................................9
SECTION 4.02. Distributions Other than Cash, Rights, Preferences or Privileges..........................9
SECTION 4.03. Subscription Rights, Preferences or Privileges...........................................10
SECTION 4.04. Notice of Dividends, etc.; Fixing of Record Date for Holders of Receipts.................11
SECTION 4.05. Voting Rights............................................................................11
SECTION 4.06. Changes Affecting Deposited Securities and Reclassifications,
Recapitalizations, etc..............................................................11
SECTION 4.07. Inspection of Reports....................................................................12
SECTION 4.08. Lists of Record Holders of Receipts......................................................12
</TABLE>
-i-
<PAGE>
<TABLE>
<CAPTION>
PAGE
<S> <C>
ARTICLE V
THE DEPOSITARY, THE DEPOSITARY'S AGENTS, THE REGISTRAR AND THE COMPANY
SECTION 5.01. Maintenance of Offices, Agencies and Transfer Books by the Depositary;
Registrar............................................................................12
SECTION 5.02. Prevention of or Delay in Performance by the Depositary, the Depositary's
Agents, the Registrar, the Transfer Agent or the Company.............................13
SECTION 5.03. Obligations of the Depositary, the Depositary's Agents, the Registrar,
the Transfer Agent and the Company..................................................13
SECTION 5.04. Resignation and Removal of the Depositary; Appointment of Successor
Depositary..........................................................................14
SECTION 5.05. Corporate Notices and Reports............................................................14
SECTION 5.06. Indemnification by the Company...........................................................15
SECTION 5.07. Charges and Expenses.....................................................................15
ARTICLE VI
AMENDMENT AND TERMINATION
SECTION 6.01. Amendment................................................................................15
SECTION 6.02. Termination..............................................................................16
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. Counterparts.............................................................................16
SECTION 7.02. Exclusive Benefit of Parties.............................................................16
SECTION 7.03. Invalidity of Provisions.................................................................16
SECTION 7.04. Notices..................................................................................16
SECTION 7.05. Depositary's Agents......................................................................17
SECTION 7.06. Holders of Receipts Are Parties..........................................................17
SECTION 7.07. Governing Law............................................................................17
SECTION 7.08. Inspection of Deposit Agreement..........................................................17
SECTION 7.09. Headings.................................................................................17
</TABLE>
EXHIBITS
EXHIBIT A Form of Depositary Receipt
-ii-
<PAGE>
This DEPOSIT AGREEMENT, dated as of _____________,
_____________, is entered by and among POLAROID CORPORATION, a Delaware
corporation, _____________, a _____ [corporation][trust company]
[banking corporation] [national banking association] and the holders from
time to time of the Receipts described herein.
RECITALS
WHEREAS, it is desired to provide, as hereinafter set forth in
this Deposit Agreement, for the deposit of shares of ____% [Convertible]
[Cumulative] Preferred Stock, Series ____ par value [$1.00] per share, of
Polaroid Corporation with the Depositary (as defined herein) for the purposes
set forth in this Deposit Agreement and for the issuance hereunder of Receipts
(as defined herein) evidencing Depositary Shares (as defined herein) in respect
of the Preferred Stock (as defined herein) so deposited; and
WHEREAS, the Receipts are to be substantially in the form of
Exhibit A annexed hereto, with appropriate insertions, modifications and
omissions, as hereinafter provided in this Deposit Agreement;
NOW, THEREFORE, in consideration of the premises, the parties
hereby agree as follows:
ARTICLE I
DEFINITIONS
The following definitions shall for all purposes, unless
otherwise indicated, apply to the respective capitalized terms used in this
Deposit Agreement:
"CERTIFICATE" shall mean the Certificate of Designations,
Powers, Preferences and Rights filed with the Secretary of State of Delaware
establishing the Preferred Stock as a series of preferred stock of the Company.
"COMMON STOCK" shall mean shares of common stock, par value
$1.00 per share, of the Company.
"COMPANY" shall mean Polaroid Corporation, a Delaware
corporation, and its successors.
"DEPOSIT AGREEMENT" shall mean this Deposit Agreement, as
amended or supplemented from time to time in accordance with the terms hereof.
"DEPOSITARY" shall mean _____________, and any successor,
as Depositary hereunder.
"DEPOSITARY SHARES" shall mean Depositary Shares, each
representing one one-[thousandth] of a share of Preferred Stock and evidenced by
a Receipt.
<PAGE>
2
"DEPOSITARY'S AGENT" shall mean an agent appointed by the
Depositary pursuant to Section 7.05.
"DEPOSITARY'S OFFICE" shall mean the office of the Depositary
to be designated by the Depositary, at which at any particular time its
depositary receipt business shall be administered.
"PREFERRED STOCK" shall mean shares of the Company's ____%
[Convertible][Cumulative] Preferred Stock, Series ___, par value $1.00 per
share.
"RECEIPT" shall mean one of the Depositary Receipts issued
hereunder, whether in definitive or temporary form.
"RECORD HOLDER" as applied to a Receipt shall mean the person
in whose name a Receipt is registered on the books of the Depositary maintained
for such purpose.
"REGISTRAR" shall mean any bank or trust company which shall
be appointed pursuant to Section 7.05 to register ownership and transfers of
Receipts as herein provided.
"TRANSFER AGENT" shall be as defined in Section 7.05.
ARTICLE II
FORM OF RECEIPTS, DEPOSIT OF PREFERRED STOCK, EXECUTION AND DELIVERY,
REDEMPTION OF RECEIPTS, TRANSFER, SPLIT-UPS AND COMBINATIONS,
SURRENDER, LOST RECEIPTS, CANCELLATION AND CONVERSION
SECTION 2.01. FORM AND TRANSFER OF RECEIPTS. Definitive
Receipts shall be engraved or printed or lithographed on steel-engraved borders
and shall be substantially in the form set forth in Exhibit A annexed to this
Deposit Agreement, with appropriate insertions, modifications and omissions, as
hereinafter provided. Pending the preparation of definitive Receipts, the
Depositary, upon the written order of the Company or any holder of Preferred
Stock, as the case may be, delivered in compliance with Section 2.02, shall
execute and deliver temporary Receipts which are printed, lithographed,
typewritten, mimeographed or otherwise substantially of the tenor of the
definitive Receipts in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the persons
executing such Receipts may determine, as evidenced by their execution of such
Receipts. If temporary Receipts are issued, the Company and the Depositary will
cause definitive Receipts to be prepared without unreasonable delay. After the
preparation of definitive Receipts, the temporary Receipts shall be exchangeable
for definitive Receipts upon surrender of the temporary Receipts at any office
described in the third paragraph of Section 2.02, without charge to the holder.
Upon surrender for cancellation of any one or more temporary Receipts, the
Depositary shall execute and deliver in exchange therefor definitive Receipts
representing the same number of Depositary Shares as represented by the
surrendered temporary Receipt or Receipts. Such exchange shall be made at the
Company's expense and without any charge therefor. Until so exchanged, the
temporary Receipts shall in all respects be entitled to the same benefits under
this Agreement, and with respect to the Preferred Stock, as definitive Receipts.
<PAGE>
3
Receipts shall be executed by the Depositary by the manual
signature of a duly authorized officer of the Depositary; PROVIDED, that such
signature may be a facsimile if a Registrar for the Receipts (other than the
Depositary) shall have been appointed and such Receipts are countersigned by
manual signature of a duly authorized officer of the Registrar. No Receipt shall
be entitled to any benefits under this Deposit Agreement or be valid or
obligatory for any purpose unless it shall have been executed manually by a duly
authorized officer of the Depositary or, if a Registrar for the Receipts (other
than the Depositary) shall have been appointed, by manual or facsimile signature
of a duly authorized officer of the Depositary and countersigned manually by a
duly authorized officer of such Registrar. The Depositary shall record on its
books each Receipt so signed and delivered as hereinafter provided.
Receipts shall be in denominations of any number of whole
Depositary Shares.
Receipts may be endorsed with or have incorporated in the text
thereof such legends or recitals or changes not inconsistent with the provisions
of this Deposit Agreement as may be required by the Depositary or required to
comply with any applicable law or any regulation thereunder or with the rules
and regulations of any securities exchange upon which the Preferred Stock, the
Depositary Shares or the Receipts may be listed or to conform with any usage
with respect thereto, or to indicate any special limitations or restrictions to
which any particular Receipts are subject.
Title to Depositary Shares evidenced by a Receipt which is
properly endorsed, or accompanied by a properly executed instrument of transfer,
shall be transferable by delivery with the same effect as in the case of a
negotiable instrument; PROVIDED, HOWEVER, that until transfer of a Receipt shall
be registered on the books of the Depositary as provided in Section 2.04, the
Depositary may, notwithstanding any notice to the contrary, treat the record
holder thereof at such time as the absolute owner thereof for the purpose of
determining the person entitled to distributions of dividends or other
distributions or to any notice provided for in this Deposit Agreement and for
all other purposes.
SECTION 2.02. DEPOSIT OF PREFERRED STOCK; EXECUTION AND
DELIVERY OF RECEIPTS IN RESPECT THEREOF. Subject to the terms and conditions of
this Deposit Agreement, the Company or any holder of Preferred Stock may from
time to time deposit shares of Preferred Stock by delivery to the Depositary of
a certificate or certificates representing the Preferred Stock to be deposited,
properly endorsed or accompanied, if required by the Depositary, by a duly
executed instrument of transfer or endorsement, in form satisfactory to the
Depositary, together with all such certifications as may be required by the
Depositary in accordance with the provisions of this Deposit Agreement, and
together with a written order of the Company or such holder, as the case may be,
directing the Depositary to execute and deliver to, or upon the written order
of, the person or persons stated in such order a Receipt or Receipts for the
number of Depositary Shares representing such deposited Preferred Stock.
Deposited Preferred Stock shall be held by the Depositary at the Depositary's
Office or at such other place or places as the Depositary shall determine.
Upon receipt by the Depositary of a certificate or
certificates representing the Preferred Stock to be deposited in accordance with
the provisions of this Section, together with the other docu ments required as
above specified, and upon recordation of such Preferred Stock on the books of
the registrar for the Preferred Stock in the name of the Depositary or its
nominee, the Depositary, subject to the terms and conditions of this Deposit
Agreement, shall execute and deliver, to or upon the order of the person or
persons named in the written order delivered to the Depositary referred to in
the first paragraph
<PAGE>
4
of this Section, a Receipt or Receipts for the number of Depositary Shares
representing the Preferred Stock so deposited and registered in such name or
names as may be requested by such person or persons.
The Depositary shall execute and deliver such Receipt or
Receipts at the Depositary's Office or such other offices, if any, as the
Depositary may designate. Delivery at other offices shall be at the risk and
expense of the person requesting such delivery.
SECTION 2.03. REDEMPTION OF PREFERRED STOCK. Whenever the
Company shall elect to redeem shares of Preferred Stock in accordance with the
provisions of the Certificate, it shall (unless otherwise agreed in writing with
the Depositary) give the Depositary not less than 40 nor more than 70 days'
notice of the date of such proposed redemption of Preferred Stock, which notice
shall be accompanied by a certificate from the Company stating that such
redemption of Preferred Stock is in accordance with the provisions of the
Certificate. Such notice, if given more than 60 days prior to the redemption
date, shall be in addition to the notice required to be given for redemption
pursuant to the Certificate. On the date of such redemption, provided that the
Company shall then have paid in full to the Depositary the redemption price of
the Preferred Stock held by the Depositary to be redeemed, plus any accrued and
unpaid dividends thereon, the Depositary shall redeem the number of Depositary
Shares representing such Preferred Stock. The Depositary shall mail notice of
such redemption and the proposed simultaneous redemption of the number of
Depositary Shares representing the Preferred Stock to be redeemed, first-class
postage prepaid, not less than 30 and not more than 60 days prior to the date
fixed for redemption of such Preferred Stock and Depositary Shares (the
"Redemption Date"), to the record holders of the Receipts evidencing the
Depositary Shares to be so redeemed, at the addresses of such holders as they
appear on the records of the Depositary; but neither failure to mail any such
notice to one or more such holders nor any defect in any notice to one or more
such holders shall affect the sufficiency of the proceedings for redemption as
to other holders. Each such notice shall state: (i) the Redemption Date; (ii)
the number of Depositary Shares to be redeemed and, if less than all the
Depositary Shares held by any such holder are to be redeemed, the number of such
Depositary Shares held by such holder to be so redeemed; (iii) the redemption
price; (iv) the place or places where Receipts evidencing Depositary Shares are
to be surrendered for payment of the redemption price; and (v) that dividends in
respect of the Preferred Stock represented by the Depositary Shares to be
redeemed will cease to accumulate on such Redemption Date. In case less than all
the outstanding Depositary Shares are to be redeemed, the Depositary Shares to
be so redeemed shall be selected by lot or pro rata (subject to rounding to
avoid fractions of the Depositary Shares) as may be determined by the Company.
Notice having been mailed by the Depositary as aforesaid, from
and after the Redemption Date (unless the Company shall have failed to redeem
the shares of Preferred Stock to be redeemed by it as set forth in the Company's
notice provided for in the preceding paragraph) all dividends in respect of the
shares of Preferred Stock so called for redemption shall cease to accumulate,
the Depositary Shares being redeemed from such proceeds shall be deemed no
longer to be outstanding, all rights of the holders of Receipts evidencing such
Depositary Shares (except the right to receive the redemption price, including
any accrued and unpaid dividends thereon) shall, to the extent of such
Depositary Shares, cease and terminate and, upon surrender of the Receipts
evidencing any such Depositary Shares (properly endorsed or assigned for
transfer, if the Depositary shall so require) in accordance with such notice,
such Depositary Shares shall be redeemed by the Depositary at a redemption price
per Depositary Share equal to one one-[thousandth] of the redemption price per
share paid in respect of the shares of Preferred Stock, plus accrued and unpaid
dividends thereon to the date fixed for redemption.
<PAGE>
5
If less than all the Depositary Shares evidenced by a Receipt
are called for redemption, the Depositary will deliver to the holder of such
Receipt upon its surrender to the Depositary, together with the redemption
payment, a new Receipt evidencing the Depositary Shares evidenced by such prior
Receipt and not called for redemption.
SECTION 2.04. REGISTRATION OF TRANSFER OF RECEIPTS. Subject to
the terms and conditions of this Deposit Agreement, the Depositary shall
register on its books from time to time transfers of Receipts upon any surrender
thereof by the holder in person or by duly authorized attorney, properly
endorsed or accompanied by a properly executed instrument of transfer. Thereupon
the Deposi tary and the Registrar shall execute a new Receipt or Receipts
evidencing the same aggregate number of Depositary Shares as those evidenced by
the Receipt or Receipts surrendered and deliver such new Receipt or Receipts to
or upon the order of the person entitled thereto.
SECTION 2.05. SPLIT-UPS AND COMBINATIONS OF RECEIPTS;
SURRENDER OF RECEIPTS AND WITHDRAWAL OF PREFERRED STOCK. Upon surrender of a
Receipt or Receipts at the Depositary's Office or at such other offices as it
may designate for the purpose of effecting a split-up or combination of such
Receipt or Receipts, and subject to the terms and conditions of this Deposit
Agreement, the Depositary shall execute and deliver a new Receipt or Receipts in
the authorized denomination or denominations requested, evidencing the aggregate
number of Depositary Shares evidenced by the Receipt or Receipts surrendered.
Any holder of a Receipt or Receipts representing any number of
whole shares of Preferred Stock may withdraw the Preferred Stock by surrendering
such Receipt or Receipts, at the Depositary's Office or at such other offices as
the Depositary may designate for such withdrawals. Thereafter, without
unreasonable delay, the Depositary shall deliver to such holder, or to the
person or persons designated by such holder as hereinafter provided, the number
of whole shares of Preferred Stock represented by the Receipt or Receipts so
surrendered for withdrawal, but holders of such whole shares of Preferred Stock
will not thereafter be entitled to deposit such Preferred Stock hereunder or to
receive Depositary Shares therefor. If a Receipt delivered by the holder to the
Depositary in connection with such withdrawal shall evidence a number of
Depositary Shares in excess of the number of Depositary Shares representing the
number of whole shares of Preferred Stock to be so withdrawn, the Depositary
shall at the same time, in addition to such number of whole shares of Preferred
Stock to be so withdrawn, deliver to such holder a new Receipt evidencing such
excess number of Depositary Shares. Delivery of the Preferred Stock being
withdrawn may be made by the delivery of such certificates, documents of title
and other instruments as the Depositary may deem appropriate.
If the Preferred Stock being withdrawn is to be delivered to a
person or persons other than the record holder of the Receipt or Receipts being
surrendered for withdrawal of Preferred Stock, such holder shall execute and
deliver to the Depositary a written order so directing the Depositary and the
Depositary may require that the Receipt or Receipts surrendered by such holder
for withdrawal of such shares of Preferred Stock be properly endorsed in blank
or accompanied by a properly executed instrument of transfer in blank.
Delivery of the Preferred Stock represented by Receipts
surrendered for withdrawal shall be made by the Depositary at the Depositary's
office or at such other offices as the Depositary may designate, except that, at
the request, risk and expense of the holder surrendering such Receipt or
<PAGE>
6
Receipts and for the account of the holder thereof, such delivery may be made at
such other place as may be designated by such holder.
SECTION 2.06. LIMITATIONS ON EXECUTION AND DELIVERY, TRANSFER,
SURRENDER AND EXCHANGE OF RECEIPTS. As a condition precedent to the execution
and delivery, registration of transfer, split-up, combination, surrender or
exchange of any Receipt, the Depositary, any of the Depositary's Agents or the
Company may require (a) payment to it of a sum sufficient for the payment (or,
in the event that the Depositary or the Company shall have made such payment,
the reimbursement to it) of any charges or expenses payable by the holder of a
Receipt pursuant to Section 5.07, (b) the production of evidence satisfactory to
it as to the identity and genuineness of any signature and (c) compliance with
such regulations, if any, as the Depositary or the Company may establish
consistent with the provisions of this Deposit Agreement.
The deposit of Preferred Stock may be refused, the delivery of
Receipts against Preferred Stock may be suspended, the registration of transfer
of Receipts may be refused and the registration of transfer, surrender or
exchange of outstanding Receipts may be suspended (i) during any period when the
register holders of Preferred Stock of the Company is closed or (ii) if any such
action is deemed necessary or advisable by the Depositary, any Depositary's
Agents or the Company, at any time or from time to time, because of any
requirement of law or of any government or governmental body or commission or
under any provision of this Deposit Agreement.
SECTION 2.07. LOST RECEIPTS, ETC. In case any Receipt shall be
mutilated, destroyed, lost or stolen, the Depositary in its discretion may
execute and deliver a Receipt of like form and tenor in exchange and
substitution for such mutilated Receipt, or in lieu of and in substitution for
such destroyed, lost or stolen Receipt, upon (i) the filing by the holder
thereof with the Depositary of evidence satisfactory to the Depositary of such
destruction or loss or theft of such Receipt, of the authenticity thereof and of
his or her ownership thereof and (ii) the furnishing of the Depositary with
reasonable indemnification (which may include posting an indemnity bond)
satisfactory to it.
SECTION 2.08. CANCELLATION AND DESTRUCTION OF SURRENDERED
RECEIPTS. All Receipts surrendered to the Depositary or any Depositary's Agent
shall be canceled by the Depositary. Except as prohibited by applicable law or
regulation, the Depositary is authorized to destroy all Receipts so canceled.
SECTION 2.09. CONVERSION OF PREFERRED STOCK INTO COMMON STOCK.
Receipts may be surrendered with written instructions to the Depositary to
instruct the Company to cause the conversion of any specified number of whole or
fractional shares of Preferred Stock represented by the Depositary Shares
evidenced thereby into whole shares of Common Stock at the conversion price then
in effect for the Preferred Stock (and, therefore, for the Depositary Shares)
specified in the Certificate, as such conversion price may be adjusted by the
Company from time to time as provided in the Certificate. Subject to the terms
and conditions of this Deposit Agreement and the Certificate, a holder of a
Receipt or Receipts evidencing Depositary Shares representing whole or
fractional shares of Preferred Stock may surrender such Receipt or Receipts at
the corporate office of the Depositary or to such office or to such Depositary's
Agents as the Depositary may designate for such purpose, together with a notice
of conversion duly completed and executed, thereby directing the Depositary to
instruct the Company to cause the conversion of the number of shares or
fractions thereof of underlying Preferred Stock specified in such notice of
conversion into shares of Common Stock, and an assignment of such Receipt or
<PAGE>
7
Receipts to the Company or in blank, duly completed and executed. No
fractional shares of Common Stock shall be issuable upon conversion of
Preferred Shares underlying the Depositary Shares. To the extent that a
holder delivers to the Depositary for conversion a Receipt or Receipts which
in the aggregate are convertible into less than one whole share of Common
Stock, the holder shall receive payment in cash in lieu of such fractional
shares of Common Stock otherwise issuable. If more than one Receipt shall be
delivered for conversion at one time by the same, holder, the number of whole
shares of Common Stock issuable upon conversion thereof shall be computed on
the basis of the aggregate number of Receipts so delivered.
Upon receipt by the Depositary of a Receipt or Receipts,
together with notice of conversion, duly completed and executed, directing the
Depositary to instruct the Company to cause the conversion of a specified number
of shares or fractions thereof of Preferred Stock and an assignment of such
Receipt or Receipts to the Company or in blank, duly completed and executed, the
Depositary shall instruct the Company (i) to cause the conversion of the
Depositary Shares evidenced by the Receipts so surrendered for conversion as
specified in the written notice to the Depositary and (ii) to cause the delivery
to the holders of such Receipts of a certificate or certificates evidencing the
number of whole shares of Common Stock and the amount of money, if any, to be
delivered to the holders of Receipts surrendered for conversion in payment of
any accrued and unpaid dividends and in lieu of fractional shares of Common
Stock otherwise issuable. The Company shall as promptly as practicable after
receipt thereof cause the delivery of (i) a certificate or certificates
evidencing the number of whole shares of Common Stock into which the shares of
Preferred Stock represented by the Depositary Shares evidenced by such Receipt
or Receipts has been converted and (ii) any money or other property to which the
holder is entitled. Upon such conversion, the Depositary (i) shall deliver to
the holder a Receipt evidencing the number of Depositary Shares, if any, which
such holder has elected not to convert and evidencing the number of Depositary
Shares, if any, in excess of the number of Depositary Shares representing shares
of Preferred Stock which has been so converted, (ii) shall cancel the Depositary
Shares evidenced by the Receipts surrendered for conversion and (iii) shall
deliver to the Company or its transfer agent for the Preferred Stock for
cancellation the shares of Preferred Stock represented by the Depositary Shares
evidenced by the Receipts so surrendered and so converted.
If provided for in the Certificate, if any shares of
Preferred Stock shall be called by the Company for redemption, the Depositary
Shares representing such shares may be converted into Common Stock as
provided in this Deposit Agreement until and including, but not after, the
close of business on the [ ] business day preceding the Redemption Date
unless the Company shall default in making payment of the shares of Common
Stock and other amounts payable upon such redemption, in which case the
Depositary Shares representing such shares of Preferred Stock may continue to
be converted into Common Stock until and including, but not after, the close
of business on the date on which the Company makes full payment of the shares
of Common Stock and other amounts payable on such redemption. Upon receipt by
the Depositary of a Receipt or Receipts, together with a properly completed
and executed notice of conversion, representing any shares of Preferred Stock
called for redemption, the shares of Preferred Stock held by the Depositary
represented by such Depositary Shares for which conversion is requested shall
be deemed to have been received by the Company for conversion as of the close
of business on the date of such receipt.
The record holder of Depositary shares on any record date with
respect to dividends established by the Depositary pursuant to Section 4.4
hereof shall be entitled to receive the dividend payable with respect to such
Depositary Shares on the corresponding dividend payment date notwithstanding the
subsequent conversion of the Preferred Stock to which such Depositary Shares
relate. If any shares of Preferred Stock are converted between the record date
with respect to any
<PAGE>
8
dividend payment on the Preferred Stock and the next succeeding dividend payment
date, any holder of Receipts surrendered with instructions to the Depositary for
conversion of the underlying Preferred Stock (except for Depositary Shares
converted after the issuance of a notice of redemption with respect to a
redemption date during such period which shall be entitled to such dividend on
the dividend payment date) shall pay to the Depositary an amount equal to the
dividend payable on such dividend payment date on the Depositary Shares
represented by the Receipt being surrendered for conversion. Any holder of
Receipts on a record date with respect to a dividend payment who (or whose
transferee) surrenders the Receipts with instructions to the Depositary for
conversion of the underlying Preferred Stock on the corresponding dividend
payment date will receive the dividend payable with respect to the Depositary
Shares underlying such Receipts and will not be required to include payment of
the amount of such dividend upon surrender of the Receipts for conversion.
Upon the conversion of any shares of Preferred Stock for which
a request for conversion has been made by the holder of Depositary Shares
representing such shares, all dividends in respect of such Depositary Shares
shall cease to accrue (except as provided in the preceding paragraph), such
Depositary Shares shall be deemed no longer outstanding, all rights of the
holder of the Receipt with respect to such Depositary Shares (except the right
to receive the Common Stock, any cash payable with respect to any fractional
Shares of Common Stock as provided herein and any cash payable on account of
accrued dividends and any Receipts evidencing Depositary Shares not so
converted) shall terminate, and the Receipt evidencing such Depositary Shares
shall be cancelled in accordance with Section 2.8 hereof.
ARTICLE III
CERTAIN OBLIGATIONS OF HOLDERS
OF RECEIPTS AND THE COMPANY
SECTION 3.01. FILING PROOFS, CERTIFICATES AND OTHER
INFORMATION. Any holder of a Receipt may be required from time to time to file
such proof of residence, or other matters or other information, to execute such
certificates and to make such representations and warranties as the Depositary
or the Company may reasonably deem necessary or proper. The Depositary or the
Company may withhold the delivery, or delay the registration of transfer,
redemption or exchange, of any Receipt or the withdrawal of the Preferred Stock
represented by the Depositary Shares evidenced by any Receipt or the
distribution of any dividend or other distribution or the sale of any rights or
of the proceeds thereof until such proof or other information is filed or such
certificates are executed or such representations and warranties are made.
SECTION 3.02. PAYMENT OF TAXES OR OTHER GOVERNMENTAL CHARGES.
Holders of Receipts shall be obligated to make payments to the Depositary of
certain charges and expenses, as provided in Section 5.07. Registration of
transfer of any Receipt or any withdrawal of Preferred Stock represented by the
Depositary Shares evidenced by such Receipt may be refused until any such
payment
<PAGE>
9
due is made, and any dividends, interest payments or other distributions may be
withheld or any part of or all the Preferred Stock or other property represented
by the Depositary Shares evidenced by such Receipt and not theretofore sold may
be sold for the account of the holder thereof (after attempting by reasonable
means to notify such holder prior to such sale), and such dividends, interest
payments or other distributions or the proceeds of any such sale may be applied
to any payment of such charges or expenses, the holder of such Receipt remaining
liable for any deficiency.
SECTION 3.03. WARRANTY AS TO PREFERRED STOCK. The Company
hereby represents and warrants that the Preferred Stock, when issued, will be
validly issued, fully paid and nonassessable. Such representation and warranty
shall survive the deposit of the Preferred Stock and the issuance of Receipts.
ARTICLE IV
THE DEPOSITED SECURITIES; NOTICES
SECTION 4.01. CASH DISTRIBUTIONS. Whenever the Depositary
shall receive any cash dividend or other cash distribution on Preferred Stock,
the Depositary shall, subject to Sections 3.01 and 3.02, distribute to record
holders of Receipts on the applicable record date fixed pursuant to Section 4.04
such amounts of such dividend or distribution as are, as nearly as practicable,
in proportion to the respective numbers of Depositary Shares evidenced by the
Receipts held by such holders; PROVIDED, HOWEVER, that in case the Company or
the Depositary shall be required to withhold and shall withhold from any cash
dividend or other cash distribution in respect of the Preferred Stock an amount
on account of taxes, the amount made available for distribution or distributed
in respect of Depositary Shares shall be reduced accordingly. The Depositary
shall distribute or make available for distribution, as the case may be, only
such amount, however, as can be distributed without attributing to any holder of
Depositary Shares a fraction of one cent, and any balance not so distributable
shall be held by the Depositary (with out liability for interest thereon) and
shall be added to and be treated as part of the next sum received by the
Depositary for distribution to record holders of Receipts then outstanding.
SECTION 4.02. DISTRIBUTIONS OTHER THAN CASH, RIGHTS,
PREFERENCES OR PRIVILEGES. Whenever the Depositary shall receive any
distribution other than cash and other than any rights, preferences or
privileges described in Section 4.03, upon Preferred Stock, the Depositary
shall, subject to Sections 3.01 and 3.02, distribute to record holders of
Receipts on the applicable record date fixed pursuant to Section 4.04 such
amounts of the securities or property received by it as are, as nearly as
practicable, in proportion to the respective numbers of Depositary Shares
evidenced by the Receipts held by such record holders, in any manner that the
Depositary may deem equitable and practicable for accomplishing such
distribution. If in the opinion of the Depositary such distribution cannot be
made proportionately among such record holders, or if for any other reason
(including any requirement that the Company or the Depositary withhold an amount
on account of taxes) the Depositary deems, after consultation with the Company,
such distribution not to be feasible, the Depositary may, with the approval of
the Company, adopt such method as it deems equitable and practicable for the
purpose of effecting such distribution, including the sale (at public or private
sale) of the securities or property thus received, or any part thereof, at such
place or places and upon such terms as it may deem proper. The net proceeds of
any such sale shall be, subject to Sections 3.01 and 3.02, distributed or made
available for distribution, as the case may be, by the Depositary to record
holders of Receipts as provided by Section 4.01 in the case of a distribution
received in cash.
<PAGE>
10
The Depositary shall not make any distribution of securities
received in respect of the Preferred Stock unless the Company shall have
provided an opinion of counsel stating that such securities have been registered
under the Securities Act of 1933, as amended, or do not need to be so
registered.
SECTION 4.03. SUBSCRIPTION RIGHTS, PREFERENCES OR PRIVILEGES.
If the Company shall at any time offer or cause to be offered to the persons in
whose names Stock is recorded on the books of the Company any rights,
preferences or privileges to subscribe for or to purchase any securities or any
rights, preferences or privileges of any other nature, such rights, preferences
or privileges shall in each such instance be made available by the Depositary to
the record holders of Receipts in such manner as the Depositary may determine,
either by the issue to such record holders of warrants representing such rights,
preferences or privileges or by such other method as may be approved by the
Depositary in its discretion with the approval of the Company; PROVIDED,
HOWEVER, that in case either (i) the Depositary determines that it is not lawful
or (after consultation with the Company) not feasible to make such rights,
preferences or privileges available to holders of Receipts by the issue of
warrants or otherwise, or (ii) with respect to any portion of the rights,
preferences or privileges of a holder of Receipts, the Depositary is instructed
that such holder does not desire to exercise such rights, preferences or
privileges, then the Depositary, in its discretion (with the approval of the
Company, in any case where the Depositary has determined that it is not feasible
to make such rights, preferences or privileges available), may (if applicable
laws and the terms of such rights, preferences or privileges permit such
transfer) sell such rights, preferences or privileges at public or private sale,
at such place or places and upon such terms as it may deem proper. The net
proceeds of any such sale shall be, subject to Sections 3.01 and 3.02,
distributed by the Depositary to the record holders of Receipts entitled thereto
as provided by Section 4.01 in the case of a distribution received in cash. The
Depositary shall not make any distribution of any such rights, preferences or
privileges unless the Company shall have provided an opinion of counsel stating
that such rights, preferences or privileges have been registered under the
Securities Act of 1933, as amended, or do not need to be so registered.
If registration under the Securities Act of 1933, as amended,
of the securities to which any rights, preferences or privileges relate is
required in order for holders of Receipts to be offered or sold the securities
to which such rights, preferences or privileges relate, the Company agrees with
the Depositary that it will file promptly a registration statement pursuant to
such Act with respect to such rights, preferences or privileges and securities
and use its best efforts and take all steps available to it to cause such
registration statement to become effective sufficiently in advance of the
expiration of such rights, preferences or privileges to enable such holders to
exercise such rights, preferences or privileges. In no event shall the
Depositary make available to the holders of Receipts any right, preference or
privilege to subscribe for or to purchase any securities unless and until such a
registration statement shall have become effective, or unless the offering and
sale of such securities to such holders are exempt from registration under the
provisions of such Act.
If any other action under the laws of any jurisdiction or any
governmental or administrative authorization, consent or permit is required in
order for such rights, preferences or privileges to be made available to holders
of Receipts, the Company agrees with the Depositary that the Company will use
its best efforts to take such action or obtain such authorization, consent or
permit sufficiently in advance of the expiration of such rights, preferences or
privileges to enable such holders to exercise such rights, preferences or
privileges.
<PAGE>
11
SECTION 4.04. NOTICE OF DIVIDENDS, ETC.; FIXING OF RECORD DATE
FOR HOLDERS OF RECEIPTS. Whenever any cash dividend or other cash distribution
shall become payable or any distribution other than cash shall be made, or if
rights, preferences or privileges shall at any time be offered, with respect to
Preferred Stock, or whenever the Depositary shall receive notice of any meeting
at which record holders of Preferred Stock are entitled to vote or of which
holders of Preferred Stock are entitled to notice, or whenever the Depositary
and the Company shall decide it is appropriate, the Depositary shall in each
such instance fix a record date (which shall be the same date as the record date
fixed by the Company with respect to the Preferred Stock) for the determination
of the record holders of Receipts who shall be entitled to receive such
dividend, distribution, rights, preferences or privileges or the net proceeds of
the sale thereof, or to give instructions for the exercise of voting rights at
any such meeting, or who shall be entitled to notice of such meeting or for any
other appropriate reasons.
SECTION 4.05. VOTING RIGHTS. Upon receipt of notice of any
meeting at which the record holders of Preferred Stock are entitled to vote, the
Depositary shall, as soon as practicable thereafter, mail to the record holders
of Receipts a notice which shall contain (i) such information as is contained in
such notice of meeting and (ii) a statement that the record holders may, subject
to any applicable restrictions, instruct the Depositary as to the exercise of
the voting rights pertaining to the amount of Preferred Stock represented by
their respective Depositary Shares (including an express indication that
instructions may be given to the Depositary to give a discretionary proxy to a
person designated by the Company) and a brief statement as to the manner in
which such instructions may be given. Upon the written request of the record
holders of Receipts on the relevant record date, the Depositary shall endeavor
insofar as practicable to vote or cause to be voted, in accordance with the
instructions set forth in such requests, the maximum number of whole shares of
Preferred Stock represented by the Depositary Shares evidenced by all Receipts
as to which any particular voting instructions are received. The Company hereby
agrees to take all action which may be deemed necessary by the Depositary in
order to enable the Depositary to vote such Preferred Stock or cause such
Preferred Stock to be voted. In the absence of specific instructions from the
record holder of a Receipt, the Depositary will abstain from voting (but, at its
discretion, not from appearing at any meeting with respect to such Preferred
Stock unless directed to the contrary by the holders of all the Receipts) to the
extent of the Preferred Stock represented by the Depositary Shares evidenced by
such Receipt.
SECTION 4.06. CHANGES AFFECTING DEPOSITED SECURITIES AND
RECLASSIFICATIONS, RECAPITALIZATIONS, ETC. Upon any change in par or stated
value, split-up, combination or any other reclassification of the Stock, or upon
any recapitalization, reorganization, merger, amalgamation or consolidation
affecting the Company or to which it is a party, the Depositary may in its
discretion with the approval of, and shall upon the instructions of, the
Company, and (in either case) in such manner as the Depositary may deem
equitable, (i) make such adjustments as are certified by the Company in (x) the
fraction of an interest represented by one Depositary Share in one share of
Stock and (y) the ratio of the redemption price per Depositary Share to the
redemption price of a share of Stock, in each case as may be necessary fully to
reflect the effects of such change in par or stated value, split-up, combination
or other reclassification of Stock, or of such recapitalization, reorganization,
merger, amalgamation or consolidation and (ii) treat any securities which shall
be received by the Depositary in exchange for or upon conversion of or in
respect of the Stock as new deposited securities so received in exchange for or
upon conversion or in respect of such Preferred Stock. In any such case the
Depositary may in its discretion, with the approval of the Company, execute and
deliver additional Receipts, or may call for the surrender of all outstanding
Receipts to be exchanged for new Receipts specifically describing such new
deposited securities. Anything to the contrary herein notwithstanding, holders
of Receipts shall have the
<PAGE>
12
right from and after the effective date of any such change in par or stated
value, split-up, combination or other reclassification of the Preferred Stock or
any such recapitalization, reorganization, merger, amalgamation or consolidation
to surrender such Receipts to the Depositary with instructions to convert,
exchange or surrender the Preferred Stock represented thereby only into or for,
as the case may be, the kind and amount of shares of Common Stock and other
securities and property and cash into which the Preferred Stock represented by
such Receipts might have been converted or for which such Preferred Stock might
have been exchanged or surrendered immediately prior to the effective date of
such transaction.
SECTION 4.07. INSPECTION OF REPORTS. The Depositary shall make
available for inspection by record holders of Receipts at the Depositary's
Office, and at such other places as it may from time to time deem advisable, any
reports and communications received from the Company which are received by the
Depositary as the holder of Preferred Stock.
SECTION 4.08. LISTS OF RECORD HOLDERS OF RECEIPTS. Promptly
upon request from time to time by the Company, the Depositary shall furnish to
it a list, as of a recent date, of the names, addresses and holdings of
Depositary Shares of all persons in whose names Receipts are registered on the
books of the Depositary.
ARTICLE V
THE DEPOSITARY, THE DEPOSITARY'S AGENTS,
THE REGISTRAR AND THE COMPANY
SECTION 5.01. MAINTENANCE OF OFFICES, AGENCIES AND TRANSFER
BOOKS BY THE DEPOSITARY; REGISTRAR. The Depositary shall maintain at the
Depositary's Office facilities for the execution, delivery, registration and
registration of transfer, surrender and exchange of Receipts, and at the offices
of the Depositary's Agents, if any, facilities for the delivery, registration of
transfer, surrender and exchange of Receipts, all in accordance with the
provisions of this Deposit Agreement.
The Depositary shall keep books at the Depositary's Office for
the registration and registration of transfer of Receipts, which books at all
reasonable times shall be open for inspection by the record holders of Receipts;
PROVIDED, that any such holder requesting to exercise such right shall certify
to the Depositary that such inspection shall be for a proper purpose reasonably
related to such person's interest as an owner of Depositary Shares evidenced by
the Receipts.
The Depositary may close such books, at any time or from time
to time, when deemed expedient by it in connection with the performance of its
duties hereunder.
The Depositary may, with the approval of the Company, appoint
a Registrar for registration of the Receipts or the Depositary Shares evidenced
thereby. If the Receipts or the Depositary Shares evidenced thereby or the
Preferred Stock represented by such Depositary Shares shall be listed on the New
York Stock Exchange, the Depositary will appoint a Registrar (acceptable to the
Company) for registration of such Receipts or Depositary Shares in accordance
with any requirements of such Exchange. Such Registrar (which may be the
Depositary if so permitted by the requirements of such Exchange) may be removed
and a substitute registrar appointed by the Depositary upon the request or
<PAGE>
13
with the approval of the Company. If the Receipts, such Depositary Shares or
such Preferred Stock are listed on one or more other stock exchanges, the
Depositary will, at the request of the Company, arrange such facilities for the
delivery, registration, registration of transfer, surrender and exchange of such
Receipts, such Depositary Shares or such Preferred Stock as may be required by
law or applicable stock exchange regulation.
SECTION 5.02. PREVENTION OF OR DELAY IN PERFORMANCE BY THE
DEPOSITARY, THE DEPOSITARY'S AGENTS, THE REGISTRAR, THE TRANSFER AGENT OR THE
COMPANY. Neither the Depositary nor any Depositary's Agent nor any Registrar nor
any Transfer Agent nor the Company shall incur any liability to any holder of
any Receipt if by reason of any provision of any present or future law, or
regulation thereunder, of the United States of America or of any other
governmental authority or, in the case of the Depositary, the Depositary's Agent
or the Registrar, by reason of any provision, present or future, of the
Company's Restated Certificate of Incorporation, as amended, (including the
Certificate), or by reason of any act of God or war or other circumstance beyond
the control of the relevant party, the Depositary, the Depositary's Agent, the
Registrar, the Transfer Agent or the Company shall be prevented or forbidden
from, or subjected to any penalty on account of, doing or performing any act or
thing which the terms of this Deposit Agreement provide shall be done or
performed; nor shall the Depositary, any Depositary's Agent, any Registrar, any
Transfer Agent or the Company incur any liability to any holder of a Receipt (i)
by reason of any nonperformance or delay, caused as aforesaid, in the
performance of any act or thing which the terms of this Deposit Agreement
provide shall or may be done or performed, or (ii) by reason of any exercise of,
or failure to exercise, any discretion provided for in this Deposit Agreement
except, in case of any such exercise or failure to exercise discretion not
caused as aforesaid, if caused by the negligence or willful misconduct of the
party charged with such exercise or failure to exercise.
SECTION 5.03. OBLIGATIONS OF THE DEPOSITARY, THE DEPOSITARY'S
AGENTS, THE REGISTRAR, THE TRANSFER AGENT AND THE COMPANY. Neither the
Depositary nor any Depositary's Agent nor any Registrar nor any Transfer Agent
nor the Company assumes any obligation or shall be subject to any liability
under this Deposit Agreement to holders of Receipts other than for its
negligence or willful misconduct.
Neither the Depositary nor any Depositary's Agent nor any
Registrar nor any Transfer Agent nor the Company shall be under any obligation
to appear in, prosecute or defend any action, suit or other proceeding in
respect of the Preferred Stock, the Depositary Shares or the Receipts which in
its opinion may involve it in expense or liability unless indemnity satisfactory
to it against all expense and liability be furnished as often as may be
required.
Neither the Depositary nor any Depositary's Agent nor any
Registrar nor any Transfer Agent nor the Company shall be liable for any action
or any failure to act by it in reliance upon the written advice of legal counsel
or accountants, or information from any person presenting Preferred Stock for
deposit, any holder of a Receipt or any other person believed by it in good
faith to be competent to give such information. The Depositary, any Depositary's
Agent, any Registrar, any Transfer Agent and the Company may each rely and shall
each be protected in acting upon any written notice, request, direction or other
document believed by it to be genuine and to have been signed or presented by
the proper party or parties.
The Depositary and any Depositary's Agent shall not be
responsible for any failure to carry out any instruction to vote any of the
shares of Preferred Stock or for the manner or effect of any
<PAGE>
14
such vote made, as long as any such action or non-action is in good faith. The
Depositary undertakes, and any Registrar and Transfer Agent shall be required to
undertake, to perform such duties and only such duties as are specifically set
forth in this Agreement, and no implied covenants or obligations shall be read
into this Agreement against the Depositary, any Registrar or any Transfer Agent.
The Depositary, the Depositary's Agents, any Registrar and any Transfer Agent
may own and deal in any class of securities of the Company and its affiliates
and in Receipts. The Depositary may also act as transfer agent or registrar of
any of the securities of the Company and its affiliates.
SECTION 5.04. RESIGNATION AND REMOVAL OF THE DEPOSITARY;
APPOINTMENT OF SUCCESSOR DEPOSITARY. The Depositary may at any time resign as
Depositary hereunder by notice of its election to do so delivered to the
Company, such resignation to take effect upon the appointment of a successor
Depositary and its acceptance of such appointment as hereinafter provided.
The Depositary may at any time be removed by the Company by
notice of such removal delivered to the Depositary, such removal to take effect
upon the appointment of a successor Depositary and its acceptance of such
appointment as hereinafter provided.
In case at any time the Depositary acting hereunder shall
resign or be removed, the Company shall, within 60 days after the delivery of
the notice of resignation or removal, as the case may be, appoint a successor
Depositary, which shall be a bank or trust company having its principal office
in the United States of America and having a combined capital and surplus of at
least $50,000,000. Every successor Depositary shall execute and deliver to its
predecessor and to the Company an instrument in writing accepting its
appointment hereunder, and thereupon such successor Depositary, without any
further act or deed, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor and for all purposes shall be the
Depositary under this Deposit Agreement, and such predecessor, upon payment of
all sums due it and on the written request of the Company, shall execute and
deliver an instrument transferring to such successor all rights and powers of
such predecessor here under, shall duly assign, transfer and deliver all right,
title and interest in the Preferred Stock to such successor, and shall deliver
to such successor a list of the record holders of all outstanding Receipts. Any
successor Depositary shall promptly mail notice of its appointment to the record
holders of Receipts.
Any corporation into or with which the Depositary may be
merged, consolidated or converted shall be the successor of such Depositary
without the execution or filing of any document or any further act, and notice
thereof shall not be required hereunder. Such successor Depositary may
authenticate the Receipts in the name of the predecessor Depositary or in the
name of the successor Depositary.
SECTION 5.05. CORPORATE NOTICES AND REPORTS. The Company
agrees that it will transmit to the record holders of Receipts, in each case at
the addresses furnished to it pursuant to Section 4.08, all notices and reports
(including without limitation financial statements) required by law, by the
rules of any national securities exchange upon which the Preferred Stock, the
Depositary Shares or the Receipts are listed or by the Company's Certificate of
Incorporation (including the Certificate) to be furnished by the Company to
holders of Receipts. Such transmission will be at the Company's expense.
SECTION 5.06. INDEMNIFICATION BY THE COMPANY. The Company
shall indemnify the Depositary, any Depositary's Agent, any Registrar and any
Transfer Agent against, and hold each of them harmless from, any loss, liability
or expense (including the costs and expenses of defending itself) which
<PAGE>
15
may arise out of (a) acts performed or omitted in connection with this Agreement
and the Receipts by (i) the Depositary, any Registrar, any Transfer Agent or any
of their respective agents (including any Depositary's Agent), except for any
liability arising out of negligence or bad faith on the respective parts of any
such person or persons, or (ii) the Company or any of its agents, or (b) the
offer, sale or registration of the Receipts or the Preferred Stock pursuant to
the provisions hereof. The obligations of the Company set forth in this Section
5.06 shall survive any succession of any Depositary, Registrar, Transfer Agent
or Depositary's Agent.
SECTION 5.07. CHARGES AND EXPENSES. The Company shall pay all
transfer and other taxes and governmental charges arising solely from the
existence of the depositary arrangements. The Company shall pay all charges of
the Depositary in connection with the initial deposit of the Preferred Stock and
the initial issuance of the Depositary Shares and any redemption of the
Preferred Stock at the option of the Company. All other transfer and other taxes
and governmental charges and fees for the withdrawal of Preferred Stock upon
surrender of Receipts shall be at the expense of holders of Depositary Shares.
If, at the request of a holder of Receipts, the Depositary incurs charges or
expenses for which it is not otherwise liable hereunder, such holder will be
liable for such charges and expenses. All other charges and expenses of the
Depositary and any Depositary's Agent hereunder and of any Registrar and
Transfer Agent (including, in each case, fees and expenses of counsel) incident
to the performance of their respective obligations hereunder will be paid upon
consultation and agreement between the Depositary and the Company as to the
amount and nature of such charges and expenses. The Depositary shall present its
statement for charges and expenses to the Company once every three months or at
such other intervals as the Company and the Depositary may agree.
ARTICLE VI
AMENDMENT AND TERMINATION
SECTION 6.01. AMENDMENT. The form of the Receipts and any
provisions of this Deposit Agreement may at any time and from time to time be
amended by agreement between the Company and the Depositary in any respect which
they may deem necessary or desirable; PROVIDED, HOWEVER, that no such amendment
(other than any change in the fees of any Depositary, Registrar or Transfer
Agent, which shall go into effect not sooner than three months after notice
thereof to the record holders of the Receipts) which shall materially and
adversely alter the rights of the holders of Receipts shall be effective unless
such amendment shall have been approved by the record holders of at least a
majority of the Depositary Shares then outstanding. Every holder of an
outstanding Receipt at the time any such amendment becomes effective shall be
deemed, by continuing to hold such Receipt, to consent and agree to such
amendment and to be bound by the Deposit Agreement as amended thereby.
SECTION 6.02. TERMINATION. This Agreement may be terminated by
the Company or the Depositary only after (i) all outstanding Depositary Shares
shall have been redeemed pursuant to Section 2.03 or (ii) there shall have been
made a final distribution in respect of the Preferred Stock in connection with
any liquidation, dissolution or winding up of the Company and such distribution
shall have been distributed to the holders of Depositary Shares pursuant to
Section 4.01 or 4.02, as applicable.
<PAGE>
16
Upon the termination of this Deposit Agreement, the Company
shall be discharged from all obligations under this Deposit Agreement except for
its obligations to the Depositary, any Depositary's Agent, any Registrar and any
Transfer Agent under Sections 5.06 and 5.07.
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. COUNTERPARTS. This Deposit Agreement may be
executed in any number of counterparts, and by each of the parties hereto on
separate counterparts, each of which counterparts, when so executed and
delivered, shall be deemed an original, but all such counterparts taken together
shall constitute one and the same instrument.
SECTION 7.02. EXCLUSIVE BENEFIT OF PARTIES. This Deposit
Agreement is for the exclusive benefit of the parties hereto, and their
respective successors hereunder, and shall not be deemed to give any legal or
equitable right, remedy or claim to any other person whatsoever.
SECTION 7.03. INVALIDITY OF PROVISIONS. In case any one or
more of the provisions contained in this Deposit Agreement or in the Receipts
should be or become invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein or therein shall in no way be affected, prejudiced or disturbed thereby.
SECTION 7.04. NOTICES. Any and all notices to be given to the
Company hereunder or under the Receipts shall be in writing and shall be deemed
to have been duly given if personally delivered or sent by mail or telegram or
telex confirmed by letter, addressed to the Company at 784 Memorial Drive,
Cambridge, Massachusetts 02139, to the attention of the [Secretary,] or at any
other address of which the Company shall have notified the Depositary in
writing.
Any and all notices to be given to the Depositary hereunder
or under the Receipts shall be in writing and shall be deemed to have been
duly given if personally delivered or sent by mail or by telegram or telex
confirmed by letter, addressed to the Depositary at the Depositary's Office,
as follows: _____________ or at any other address of which the Depositary
shall have notified the Company in writing.
Any and all notices to be given to any record holder of a
Receipt hereunder or under the Receipts shall be in writing and shall be deemed
to have been duly given if personally delivered or sent by mail or by telegram
or telex confirmed by letter, addressed to such record holder at the address of
such record holder as it appears on the books of the Depositary, or if such
holder shall have filed with the Depositary a written request that notices
intended for such holder be mailed to some other address, at the address
designated in such request.
Delivery of a notice sent by mail or by telegram or telex
shall be deemed to be effected at the time when a duly addressed letter
containing the same (or a confirmation thereof in the case of a telegram or
telex message) is deposited, postage prepaid, in a post office letter box. The
Depositary or the Company may, however, act upon any telegram or telex message
received by it from the other or from any holder of a Receipt, notwithstanding
that such telegram or telex message shall not subsequently be confirmed by
letter or as aforesaid.
<PAGE>
17
SECTION 7.05. DEPOSITARY'S AGENTS. Except as otherwise set
forth herein, the Depositary may from time to time appoint Depositary's Agents
to act in any respect for the Depositary for the purposes of this Deposit
Agreement and may at any time appoint additional Depositary's Agents and vary or
terminate the appointment of such Depositary's Agents. The Depositary will
notify the Company of any such action.
The Company has authorized the appointment of, and has
requested the Depositary to appoint hereunder,_______________________ , as
transfer agent (the "Transfer Agent") for the Depositary Shares. The
Depositary hereby appoints ____________________________ as Transfer Agent and
Registrar for the Depositary Shares and delegates to _____________________
the duties of the Depositary hereunder customarily performed by a transfer
agent, a registrar and a depositary. Without otherwise affecting the
liability of the Depositary hereunder, it is hereby agreed that if
__________________ shall have agreed in writing to be bound by all the terms
and conditions of this Deposit Agreement and to assume the obligations of the
Depositary hereunder to be performed by it, then in no event shall the
Depositary be liable for any acts or omissions of _________________________
as Transfer Agent, Registrar or Depositary's Agent with respect to the
Depositary Shares.
SECTION 7.06. HOLDERS OF RECEIPTS ARE PARTIES. The holders of
Receipts from time to time shall be parties to this Deposit Agreement and shall
be bound by all of the terms and conditions hereof and of the Receipts by
acceptance of delivery thereof.
SECTION 7.07. GOVERNING LAW. This Deposit Agreement and the
receipts and all rights hereunder and thereunder and provisions hereof and
thereof shall be governed by, and construed in accordance with, the laws of the
State of New York.
SECTION 7.08. INSPECTION OF DEPOSIT AGREEMENT. Copies of this
Deposit Agreement shall be filed with the Depositary and the Depositary's Agents
and shall be open to inspection during business hours at the Depositary's office
and the respective offices of the Depositary's Agents, if any, by any holder of
a Receipt.
SECTION 7.09. HEADINGS. The headings of articles and sections
in this Deposit Agreement and in the form of the Receipt set forth in Exhibit A
hereto have been inserted for convenience only and are not to be regarded as a
part of this Deposit Agreement or the Receipts or to have any bearing upon the
meaning or interpretation of any provision contained herein or in the Receipts.
<PAGE>
18
IN WITNESS WHEREOF, the Company and the Depositary have duly
executed this Agreement as of the day and year first above set forth, and all
holders of Receipts shall become parties hereto by and upon acceptance by them
of delivery of Receipts issued in accordance with the terms hereof.
POLAROID CORPORATION
By:
--------------------------------
-------------, as Depositary,
By:
--------------------------------
<PAGE>
Exhibit A
[FORM OF DEPOSITARY RECEIPT]
DEPOSITARY RECEIPT FOR DEPOSITARY SHARES EACH REPRESENTING
A ONE ONE-[THOUSANDTH] INTEREST (SUBJECT TO ADJUSTMENT) IN A SHARE OF
___% [CONVERTIBLE] [CUMULATIVE] PREFERRED STOCK, SERIES ____,
par value $1.00 per share,
OF
POLAROID CORPORATION
(Incorporated under the laws of the State of Delaware)
------------------------------
No. CUSIP NO.
------- ---------
EACH DEPOSITARY SHARE REPRESENTS
A ONE ONE-[THOUSANDTH] INTEREST (SUBJECT TO ADJUSTMENT) IN A SHARE OF
___% [CONVERTIBLE] [CUMULATIVE] PREFERRED STOCK SERIES ____,
par value $1.00 per share,
OF POLAROID CORPORATION
1. ____________________________________, a [corporation]
[trust company] [banking corporation] [national banking association], as
Depositary (the "Depositary"), hereby certifies that ___________ is the
registered owner of ______ Depositary Shares ("Depositary Shares"), each
Depositary Share representing a one one-[thousandth] (as such fraction may from
time to time be adjusted as provided in the Deposit Agreement, as defined below)
interest in a share of ___% [Convertible][Cumulative] Preferred Stock, Series
___ (the "Preferred Stock") of Polaroid Corporation, a corporation duly
organized and existing under the laws of the State of Delaware (the "Company")
deposited with, and held by, the Depositary. The rights, preferences and
limitations of the Preferred Stock are set forth in the Certificate of
Designations, Powers, Preferences and Rights (the "Certificate") adopted by the
Company's Board of Directors (the "Authorizing Resolutions"), copies of which
are on file at the Depositary's office at ________________________________.
2. THE DEPOSIT AGREEMENT. Depositary Receipts (the
"Receipts"), of which this Receipt is one, are made available upon the terms and
conditions set forth in the Deposit Agreement, dated as of _____________ (the
"Deposit Agreement"), among the Company, the Depositary and all holders from
time to time of Receipts. The Deposit Agreement (copies of which are on file at
the Depositary's Office) sets forth the rights of holders of Receipts and the
rights and duties of the Depositary in respect of the Preferred Stock deposited,
and any and all money and other property from time to time held thereunder. The
statements made on this Receipt are summaries of certain provisions of the
Deposit Agreement and are subject to the detailed provisions thereof, to which
reference is hereby made. The holder of this Receipt from time to time shall be
deemed to be a party to the Deposit Agreement and shall be bound by, and
entitled to all of the rights and benefits under, all the terms and conditions
hereof and of the Deposit Agreement by acceptance of delivery of this Receipt.
Unless
<PAGE>
2
otherwise expressly herein provided, all defined terms shall have the meanings
ascribed thereto in the Deposit Agreement.
3. REDEMPTION. Wherever the Company shall be permitted and
shall elect, under the Certificate, to redeem shares of the Preferred Stock, it
shall give the Depositary not less than 40 nor more then 70 days' notice
thereof. The Depositary shall mail notice of such redemption and the
simultaneous redemption of the corresponding Depositary Shares not less than 30
and not more than 60 days prior to the date fixed for redemption to the holders
of record of Receipts representing the number of Depositary Shares to be
redeemed. Each such notice shall state: (a) the date of such proposed
redemption; (b) the number of Depositary Shares to be redeemed; (c) the
redemption price (which shall include full cumulative dividends thereon to the
redemption date); (d) the place or places where Receipts evidencing Depositary
Shares are to be surrendered for payment of the redemption price; and (e) that
dividends in respect of the Preferred Stock represented by the Depositary Shares
to be redeemed will cease to accumulate at the close of business on such
redemption date. In case less than all the outstanding Depositary Shares are to
be redeemed, the Depositary Shares to be so redeemed shall be selected by lot or
pro rata as may be determined by the Depositary to be equitable. From and after
the date set for redemption, all dividends in respect of the Depositary Shares
so called for redemption shall cease to accrue, such Depositary Shares shall no
longer be deemed outstanding and all rights of the holders of Receipts
representing such Depositary Shares (except the right to receive the redemption
price) shall cease and terminate. From and after the redemption date, upon
surrender in accordance with the redemption notice of the Receipts representing
any such Depositary Shares (properly endorsed or assigned for transfer, if the
Depositary shall so require), such Depositary Share shall be redeemed by the
Depositary at the redemption price per share equal to one [one-thousandth
(1/1000th)] of the redemption price per share paid in respect of the shares of
Preferred Stock plus any money or other property represented thereby.
4. TRANSFERS, SPLIT-UPS, COMBINATIONS. This Receipt is
transferable on the books of the Depositary upon surrender of this Receipt to
the Depositary, properly endorsed or accompanied by a properly executed
instrument of transfer, and upon such transfer the Depositary shall execute a
new Receipt to or upon the order of the person entitled thereto, as provided in
the Deposit Agreement. This Receipt may be split into other Receipts or combined
with other Receipts into one Receipt, representing the same aggregate number of
Depositary Shares as the Receipt or Receipts surrendered.
5. CONVERSION OF PREFERRED STOCK INTO COMMON STOCK. Receipts
may be surrendered with written instructions to the Depositary to instruct the
Company to cause the conversion of any specified number of whole or fractional
shares of Preferred Stock represented by the Depositary Shares evidenced thereby
into whole shares of Common Stock at the conversion price then in effect for the
Preferred Stock (and, therefore, for the Depositary Shares) specified in the
Certificate, as such conversion price may be adjusted by the Company from time
to time as provided in the Certificate. Subject to the terms and conditions of
this Deposit Agreement and the Certificate, a holder of a Receipt or Receipts
evidencing Depositary Shares representing whole or fractional shares of
Preferred Stock may surrender such Receipt or Receipts at the corporate office
of the Depositary or to such office or to such Depositary's Agents as the
Depositary may designate for such purpose, together with a notice of conversion
duly completed and executed, thereby directing the Depositary to instruct the
Company to cause the conversion of the number of shares or fractions thereof of
underlying Preferred Stock specified in such notice of conversion into shares of
Common Stock, and an assignment of such Receipt or Receipts to the Company or in
blank, duly completed and executed. To the extent that a holder delivers
<PAGE>
3
to the Depositary for conversion a Receipt or Receipts which in the aggregate
are convertible into less than one whole share of Common Stock, the holder shall
receive payment in cash in lieu of such fractional shares of Common Stock
otherwise issuable. If more than one Receipt shall be delivered for conversion
at one time by the same, holder, the number of whole shares of Common Stock
issuable upon conversion thereof shall be computed on the basis of the aggregate
number of Receipts so delivered.
Upon receipt by the Depositary of a Receipt or Receipts,
together with notice of conversion, duly completed and executed, directing the
Depositary to instruct the Company to cause the conversion of a specified number
of shares or fractions thereof of Preferred Stock and an assignment of such
Receipt or Receipts to the Company or in blank, duly completed and executed, the
Depositary shall instruct the Company (i) to cause the conversion of the
Depositary Shares evidenced by the Receipts so surrendered for conversion as
specified in the written notice to the Depositary and (ii) to cause the delivery
to the holders of such Receipts of a certificate or certificates evidencing the
number of whole shares of Common Stock and the amount of money, if any, to be
delivered to the holders of Receipts surrendered for conversion in payment of
any accrued and unpaid dividends and in lieu of fractional shares of Common
Stock otherwise issuable. The Company shall as promptly as practicable after
receipt thereof cause the delivery of (i) a certificate or certificates
evidencing the number of whole shares of Common Stock into which the shares of
Preferred Stock represented by the Depositary Shares evidenced by such Receipt
or Receipts has been converted and (ii) any money or other property to which the
holder is entitled. Upon such conversion, the Depositary (i) shall deliver to
the holder a Receipt evidencing the number of Depositary Shares, if any, which
such holder has elected not to convert and evidencing the number of Depositary
Shares, if any, in excess of the number of Depositary Shares representing shares
of Preferred Stock which has been so converted, (ii) shall cancel the Depositary
Shares evidenced by the Receipts surrendered for conversion and (iii) shall
deliver to the Company or its transfer agent for the Preferred Stock for
cancellation the shares of Preferred Stock represented by the Depositary Shares
evidenced by the Receipts so surrendered and so converted.
6. SUSPENSION OF DELIVERY, TRANSFER, ETC. The transfer or
surrender of this Receipt may be suspended during any period when the register
of holders of Preferred Stock of the Company is closed or if any such action is
deemed necessary or advisable by the Depositary, any agent of the Depositary, or
the Company at any time or from time to time because of any requirement of law
or of any government or governmental body or commission, or under any provision
of the Deposit Agreement.
7. PAYMENT OF TAXES OR OTHER GOVERNMENTAL CHARGES. If any tax
or other government charge shall become payable by or on behalf of the
Depositary with respect to this Receipt, such tax (including transfer taxes, if
any) or governmental charge shall be payable by the holder hereof. Transfer of
this Receipt may be refused until such payment is made, and any dividends,
interest payments or other distributions may be withheld or any part of or all
the Preferred Stock or other property represented by this Receipt and not
theretofore sold may be sold for the account of the holder thereof (after
attempting by reasonable means to notify such holder prior to such sale), and
such dividends, interest payments or other distributions or the proceeds of any
such sale may be applied to any payment of such tax or charge, the holder of
this Receipt remaining liable for any deficiency.
8. WARRANTY BY COMPANY. The Company has warranted that the
Preferred Stock, when issued, will be validly issued, fully paid and
nonassessable.
<PAGE>
4
9. AMENDMENT. The form of the Receipts and any provisions of
the Deposit Agreement may at any time and from time to time be amended by
agreement between the Company and the Depositary in any respect which they may
deem necessary or desirable; PROVIDED, HOWEVER, that no such amendment which
shall materially and adversely alter the rights of the holders of Receipts shall
be effective unless such amendment shall have been approved by the holders of at
least a majority of the Depositary Shares then outstanding. A holder of a
Receipt at the time any such amendment so becomes effective shall be deemed, by
continuing to hold such Receipt, to consent and agree to such amendment and to
be bound by the Deposit Agreement as amended thereby.
10. CHARGES OF DEPOSITARY. The Company will pay all transfer
and other taxes and governmental charges arising solely from the existence of
the depositary arrangements, and all charges of the Depositary in connection
with the initial deposit of the Preferred Stock and the initial issuance of the
Depositary Shares and redemption of the Preferred Stock at the option of the
Company. All other transfer and other taxes and other governmental charges shall
be at the expense of holders of Depositary Shares. All other charges and
expenses of the Depositary and any agent of the Depositary will be paid in
consultation and agreement between the Depositary and the Company.
11. TITLE OF RECEIPTS. This Receipt (and the Depositary Shares
evidenced hereby), when properly endorsed or accompanied by a properly executed
instrument of transfer, is transferable by delivery with the same effect as in
the case of a negotiable instrument; PROVIDED, HOWEVER, that until transfer of a
Receipt shall be registered on the books of the Depositary, the Depositary may,
notwithstanding any notice to the contrary, treat the record holder hereof at
such time as the absolute owner hereof for the purpose of determining the person
entitled to distributions of dividends or other distributions or to any notice
provided for in the Deposit Agreement, and for all other purposes.
12. DIVIDENDS AND DISTRIBUTIONS. Whenever the Depositary
receives any cash dividend or other cash distribution on the Preferred Stock,
the Depositary will, subject to the provisions of the Deposit Agreement, make
such distribution to the Receipt holders as nearly as practicable in proportion
to the number of Depositary Shares held by them; PROVIDED, HOWEVER, that the
amount distributed will be reduced by any amounts required to be withheld by the
Company or the Depositary on account of taxes. Other distributions received on
the Preferred Stock may be distributed to holders of Receipts as provided in the
Deposit Agreement.
13. FIXING OF RECORD DATE. Whenever any cash dividend or other
cash distribution shall become payable or any distribution other than cash shall
be made, or if rights, preferences or privileges shall at any time be offered,
with respect to Preferred Stock, or whenever the Depositary shall receive notice
of any meeting at which holders of Preferred Stock are entitled to vote or of
which holders of Preferred Stock are entitled to notice, the Depositary shall in
each instance fix a record date (which shall be the record date fixed by the
Company with respect to the Preferred Stock), for the determination of the
holders of Receipts who shall be entitled to receive such dividend,
distribution, rights, preferences or privileges or the net proceeds of the sale
thereof, or to give instructions for the exercise of voting rights at any such
meeting, or who shall be entitled to notice of such meeting.
14. VOTING RIGHTS. Upon receipt of notice of any meeting at
which holders of Preferred Stock are entitled to vote, the Depositary shall, as
soon as practicable thereafter, mail to the record holders of Receipts a notice
which shall contain (i) such information as is contained in such notice of
meeting and (ii) a statement informing holders of Receipts that they may
instruct the Depositary as to
<PAGE>
5
the exercise of the voting rights pertaining to the amount of Preferred Stock
represented by their respective Depositary Shares and a brief statement as to
the manner in which such instructions may be given. Upon the written request of
a holder of a Receipt on such record date, the Depositary shall endeavor insofar
as practicable to vote or cause to be voted the amount of Preferred Stock
represented by such Receipt in accordance with the instructions set forth in
such request. In the absence of specific instructions from the holder of a
Receipt, the Depositary will abstain from voting (but, at its discretion, not
from appearing at any meeting with respect to such Preferred Stock unless
directed to the contrary by the holders of Receipts) to the extent of the
Preferred Stock represented by the Depositary Shares evidenced by such Receipt.
15. CHANGES AFFECTING DEPOSITED SECURITIES. Upon any change in
par or stated value, split-up, combination or any other reclassification of the
Preferred Stock or upon any recapitalization, reorganization, merger,
amalgamation or consolidation affecting the Company or to which it is a party,
or upon the sale of all or substantially all the Company's assets, the
Depositary may in its discretion with the approval of the Company, and in such
manner as the Depositary may deem equitable, (i) make such adjustments in (x)
the fraction of an interest represented by one Depositary Share in one share of
Preferred Stock and (y) the ratio of the redemption price of a share of
Preferred Stock, in each case as may be necessary fully to reflect the effect of
such change and (ii) treat any securities which shall be received by the
Depositary in exchange for or upon conversion or in respect of the Preferred
Stock as new deposited securities so received in exchange for or upon conversion
or in respect of such Preferred Stock. In any such case the Depositary may in
its discretion, with the approval of the Company, execute and deliver additional
Receipts, or may call for the surrender of outstanding Receipts to be exchanged
for new Receipts specifically describing such new deposited securities.
16. LIABILITY AND OBLIGATIONS OF THE DEPOSITARY, THE
DEPOSITARY'S AGENTS OR THE COMPANY. Neither the Depositary nor any Depositary's
Agent nor any Registrar nor the Company assumes any obligation or shall be
subject to any liability under this Deposit Agreement to any holder of any
Receipt, other than for its gross negligence or willful misconduct. Neither the
Depositary nor any Depositary's Agent nor any Registrar nor the Company shall
incur any liability to any holder of any Receipt if by reason of any provision
of any present or future law or regulation thereunder of the United States of
America or any other governmental authority or, in the case of the Depositary,
the Depositary's Agent or the Registrar, by reason of any provision, present or
future, of the Company's Certificate of Incorporation (including the
Certificate) or by reason of any act of God or war or other circumstances beyond
their control, the Depositary, the Depositary's Agent, the Registrar or the
Company shall be prevented or forbidden from doing or performing any act or
thing which the terms of this Deposit Agreement provide shall be done or
performed; nor shall the Depositary, any Depositary's Agent, any Registrar or
the Company incur any liability to any holder of a Receipt by reason of
nonperformance or delay, caused as aforesaid, in performance of any act or thing
which by the terms of the Deposit Agreement it is provided shall or may be done
or performed, or by reason of any exercise of, or failure to exercise, any
discretion provided for in the Deposit Agreement, other than for its gross
negligence or willful misconduct. Neither the Depositary nor any Depositary's
Agent nor the Company assumes any obligation or shall be subject to any
liability under the Deposit Agreement to holders of Receipts other than to use
its best judgment and good faith in the performance of such duties as are
specifically set forth in the Deposit Agreement. Neither the Depositary nor any
Depositary's Agent nor any Registrar nor the Company shall be under any
obligation to appear in, prosecute or defend any action, suit or other
proceeding in respect of the Preferred Stock, the Depositary Shares or the
Receipts, which in its opinion may involve it in expense or liability, unless
indemnity satisfactory to it against all expense and liability
<PAGE>
6
be furnished. The Deposit Agreement contains various other exculpancy,
indemnification and related provisions, to which reference is hereby made.
17. RESIGNATION AND REMOVAL OF DEPOSITARY. The Depositary may
at any time (a) resign by written notice of its election to do so delivered to
the Company, such resignation to take effect upon the appointment of a successor
Depositary and its acceptance of such appointment, or (b) be removed by the
Company effective upon the appointment of a successor Depositary and its
acceptance of such appointment.
18. TERMINATION OF DEPOSIT AGREEMENT. The Deposit Agreement
may be terminated by the Company or the Depositary only upon or after the
occurrence of any of the following events: (i) all outstanding Depositary Shares
shall have been redeemed or (ii) there shall have been made a final distribution
in respect of the Preferred Stock in connection with any liquidation,
dissolution or winding up of the Company and such distribution shall have been
distributed to the holders of Receipts. Upon the termination of the Deposit
Agreement, the Company shall be discharged from all obligations thereunder
except for its obligations to the Depositary with respect to indemnification,
charges and expenses.
19. GOVERNING LAW. This Receipt and the Deposit Agreement and
all rights hereunder and thereunder and provisions hereof and thereof shall be
governed by and construed in accordance with the laws of the State of New York.
This Receipt shall not be entitled to any benefits under the
Deposit Agreement or be valid or obligatory for any purpose unless this Receipt
shall have been executed manually by a duly authorized signatory of the
Depositary or, if a Registrar for the Receipts (other than the Depositary) shall
have been appointed, by facsimile by the Depositary provided this Receipt is
countersigned manually by the signature of a duly authorized signatory of such
Registrar.
<PAGE>
The Corporation will furnish without charge to each holder of
Preferred Stock who so requests the powers, designations, preferences and rights
of each class of Preferred Stock or series thereof and the qualifications,
limitations or restrictions of such preferences and/or rights.
---------------------------------,
as Depositary and Registrar
By:
-------------------------------
Authorized Officer
Dated:
<PAGE>
FRONT:
Number Shares
No.
Polaroid Corporation
INCORPORATED UNDER THE LAWS OF DELAWARE
This certifies that is the owner of
FULL-PAID AND NON-ASSESSABLE SHARES OF THE PAR VALUE OF ONE DOLLAR ($1.00)
EACH OF THE COMMON STOCK OF
Polaroid Corporation, transferable on the books of the Corporation by the
holder hereof in person or by duly authorized attorney upon surrender of this
Certificate properly endorsed. This Certificate and the shares represented
thereby are issued and shall be subject to all of the provisions of the
Certificate of Incorporation of the Corporation as now or hereafter amended
to all of which the holder hereof by acceptance hereby assents.
This Certificate is not valid unless countersigned by the Transfer
Agent and registered by the Registrar.
Witness the facsimile seal of the Corporation and witness the facsimile
signatures of its duly authorized officers.
Dated: _____________________
By: _______________________
Name:
Title:
By: _______________________
Name:
Title:
Registered:
Registrar
By: _______________________
Authorized Officer:
Countersigned:
Transfer Agent
By: _______________________
Authorized Officer
<PAGE>
REVERSE:
POLAROID CORPORATION
A statement of the designations, preferences and relative, participating,
optional or other special rights of each class of Preferred Stock and of the
Common Stock, and the qualifications, limitations or restrictions of such
preferences and/or rights is set forth in Article Fourth (A) of the
Certificate of Incorporation, as amended, of the Company, copies of which
Article may be obtained, without charge, from the office of the company or
from the office of the Transfer Agent.
For Value Received ______ hereby sell, assign and transfer unto
- ------------------------------------------------------
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS)
Shares of the capital stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint _________________ Attorney, to transfer the
said stock on the Books of the within names Corporation with full power of
substitution in the premises.
Date: ______________________.
________________________________________
Notice: The Signature to this Assignment must correspond with the name as
written upon the Face of the Certificate in every particular, without
alteration or enlargement or any change whatever.
<PAGE>
Exhibit 4.20
POLAROID CORPORATION
__%[Convertible][Cumulative] Preferred Stock, Series __
Cusip No.: _________ ___________ Shares
THIS CERTIFIES THAT__________________________________________
is the owner of fully paid and non-assessable shares of ____%
[Convertible][Cumulative] Preferred Stock, Series ___, par value $1.00 per
share, of POLAROID CORPORATION, a corporation incorporated under the laws of
Delaware (the "Corporation"), transferable on the books of the Corporation by
the holder hereof in person or by its duly authorized attorney, upon surrender
of this Certificate properly endorsed. This Certificate and the shares
represented hereby are issued and shall be held subject to all of the provisions
of the Certificate of Designations, Powers, Preferences and Rights of the __%
[Convertible] [Cumulative] Preferred Stock, Series __, the Restated Certificate
of Incorporation of the Corporation, as amended, and the By-laws of the
Corporation and any amendments or restatements thereto. This Certificate is not
valid unless countersigned and registered by the Transfer Agent and Registrar.
IN WITNESS WHEREOF, the Corporation has caused this Certificate to be
executed on its behalf by its duly authorized officers.
POLAROID CORPORATION
By: _____________________
Name:
Title:
Countersigned and Registered:
- ----------------------------
Transfer Agent and Registrar
By: _______________________,
Authorized signatory
Dated: _________________
<PAGE>
2
The Corporation will furnish without charge to each
stockholder who so requests a description of the powers, designations,
preferences and relative, participating, optional or other special rights, and
the qualifications, limitations or restrictions, of each class of capital stock
or series thereof which the corporation is authorized to issue. Such request
should be directed to the office of the Secretary of the Corporation, 784
Memorial Drive, Cambridge, Massachusetts 02139, telephone number: (781)
386-2000.
---------------------------------
KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN OR DESTROYED,
THE CORPORATION WILL REQUIRE A BOND OF INDEMNITY AS A CONDITION TO
THE ISSUANCE OF A REPLACEMENT CERTIFICATE.
---------------------------------
The following abbreviations, when used in the inscription on
the face of this Certificate, shall be construed as though they were written out
in full according to applicable laws or regulations:
TEN COM-- as tenants in common UNIF GIFT MIN ACT_____ (Custodian)__
(Custodian) (Minor)
TEN ENT -- as tenants by the entireties under Uniform Gifts to Minors Act of
____________
(State)
JT TEN -- as joint tenants with right of
survivorship and not as tenants
in common
Additional abbreviations may also be used though not in the above list.
<PAGE>
3
ASSIGNMENT FORM
FOR VALUE RECEIVED, __________________________________________
HEREBY SELL, ASSIGN AND TRANSFER UNTO
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF
ASSIGNEE
- ----------------------------------------
- ----------------------------------------
- ------------------------------------------------------------------------------
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)
____________________________ shares of ____% [Convertible] [Cumulative]
Preferred Stock Series ____ of the Corporation represented by this Certificate
and do hereby irrevocably constitute and appoint __________________ Attorney to
transfer the said shares of ____% [Convertible] [Cumulative] Preferred Stock,
Series ____ on the books of the Corporation, with full power of substitution in
the premises.
Dated: _______________________
Signature:_____________________________________________
NOTICE: The signature to this assignment must correspond
with the name as written upon the face of the
certificate in every particular, without alteration or
enlargement or any change whatever.
Signature(s) Guaranteed:
By:__________________
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION,
(BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS) WITH
MEMBERSHIP IN AN APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM) PURSUANT TO
S.E.C. RULE 17AD-15.
<PAGE>
4
NOTICE OF ELECTION TO CONVERT
If you want to elect to have all of the shares of Series __
Preferred Stock represented by this Certificate converted by the Company into
_____ shares of common stock, par value $1.00 per share, of the Company pursuant
to Section 4(a) of the Certificate of Designations, please check the box below:
/ / Convert all shares of Series ___ Preferred Stock pursuant to Section 4(a)
If you want to elect to have only part of the shares of Series
__ Preferred Stock represented by this Certificate converted by the Company into
_____ shares of common stock, par value $1.00 per share, of the Company pursuant
to Section 4(a) of the Certificate of Designations, state the amount you elect
to have converted:
$
------------.
Your Signature: ____________________________________________________
(SIGN EXACTLY AS YOUR NAME APPEARS ON THE FACE OF THIS NOTE)
Tax Identification No.: _______________________
Date: _____________________________________
Signature Guarantee: ___________________
<PAGE>
Exhibit 4.21
===============================================================================
POLAROID CORPORATION
AND
[-------------------------],
As Purchase Contract Agent
PURCHASE CONTRACT AGREEMENT
Dated as of [___________], 1999
===============================================================================
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
ARTICLE I
Definitions and Other Provisions of General Applications
Section 1.1. Definitions.................................................................................1
Section 1.2. Compliance Certificates and Opinions.......................................................11
Section 1.3. Form of Documents Delivered to Agent.......................................................12
Section 1.4. Acts of Holders; Record Dates..............................................................12
Section 1.5. Notices....................................................................................13
Section 1.6. Notice to Holders; Waiver..................................................................14
Section 1.7. Effect of Headings and Table of Contents...................................................15
Section 1.8. Successors and Assigns.....................................................................15
Section 1.9. Separability Clause........................................................................15
Section 1.10. Benefits of Agreement......................................................................15
Section 1.11. Governing Law..............................................................................15
Section 1.12. Legal Holidays.............................................................................15
Section 1.13. Counterparts...............................................................................16
Section 1.14. Inspection of Agreement....................................................................16
ARTICLE II
Certificate Forms
Section 2.1. Forms of Certificates Generally............................................................16
Section 2.2. Form of Agent's Certificate of Authentication..............................................17
ARTICLE III
The Securities
Section 3.1. Amount; Form and Denominations.............................................................18
Section 3.2. Rights and Obligations Evidenced by the Certificates.......................................18
Section 3.3. Execution, Authentication, Delivery and Dating.............................................19
Section 3.4. Temporary Certificates.....................................................................19
Section 3.5. Registration; Registration of Transfer and Exchange........................................20
Section 3.6. Book-Entry Interests.......................................................................21
Section 3.7. Notices to Holders.........................................................................22
Section 3.8. Appointment of Successor Clearing Agency...................................................22
Section 3.9. Definitive Certificates....................................................................22
Section 3.10. Mutilated, Destroyed, Lost and Stolen Certificates.........................................22
Section 3.11. Persons Deemed Owners......................................................................23
Section 3.12. Cancellation...............................................................................24
Section 3.13. Substitution of Securities.................................................................24
Section 3.14. Reestablishment of Type A Units............................................................25
Section 3.15. Transfer of Collateral upon Occurrence of Termination Event................................26
</TABLE>
-i-
<PAGE>
<TABLE>
<CAPTION>
Page
<S> <C>
Section 3.16. No Consent to Assumption...................................................................27
ARTICLE IV
The Debentures
Section 4.1. Payment of Interest; Rights to Interest Preserved; Interest Rate Reset.....................27
Section 4.2. Notice and Voting..........................................................................28
ARTICLE V
The Purchase Contracts
Section 5.1. Purchase of Shares of Common Stock.........................................................29
Section 5.2. Contract Adjustment Payments...............................................................30
Section 5.3. [Intentionally omitted]....................................................................31
Section 5.4. Payment of Purchase Price..................................................................31
Section 5.5. Issuance of Shares of Common Stock.........................................................34
Section 5.6. Adjustment of Settlement Rate..............................................................35
Section 5.7. Notice of Adjustments and Certain Other Events.............................................40
Section 5.8. Termination Event; Notice..................................................................40
Section 5.9. Early Settlement...........................................................................41
Section 5.10. No Fractional Shares.......................................................................42
Section 5.11. Charges and Taxes..........................................................................42
ARTICLE VI
Remedies
Section 6.1. Unconditional Right of Holders to Receive Contract Adjustment Payments and
to Purchase Common Stock...................................................................43
Section 6.2. Restoration of Rights and Remedies.........................................................43
Section 6.3. Rights and Remedies Cumulative.............................................................43
Section 6.4. Delay or Omission Not Waiver...............................................................44
Section 6.5. Undertaking for Costs......................................................................44
Section 6.6. Waiver of Stay or Extension Laws...........................................................44
ARTICLE VII
The Agent
Section 7.1. Certain Duties and Responsibilities........................................................45
Section 7.2. Notice of Default..........................................................................46
Section 7.3. Certain Rights of Agent....................................................................46
Section 7.4. Not Responsible for Recitals or Issuance of Securities.....................................47
Section 7.5. May Hold Securities........................................................................47
Section 7.6. Money Held in Custody......................................................................47
Section 7.7. Compensation and Reimbursement.............................................................47
Section 7.8. Corporate Agent Required; Eligibility......................................................48
</TABLE>
-ii-
<PAGE>
<TABLE>
<CAPTION>
Page
<S> <C>
Section 7.9. Resignation and Removal; Appointment of Successor..........................................48
Section 7.10. Acceptance of Appointment by Successor.....................................................49
Section 7.11. Merger, Conversion, Consolidation or Succession to Business................................50
Section 7.12. Preservation of Information; Communications to Holders.....................................50
Section 7.13. No Obligations of Agent....................................................................50
Section 7.14. Tax Compliance.............................................................................51
ARTICLE VIII
Supplemental Agreements
Section 8.1. Supplemental Agreements Without Consent of Holders.........................................51
Section 8.2. Supplemental Agreements With Consent of Holders............................................52
Section 8.3. Execution of Supplemental Agreements.......................................................53
Section 8.4. Effect of Supplemental Agreements..........................................................53
Section 8.5. Reference to Supplemental Agreements.......................................................53
ARTICLE IX
Consolidation, Merger, Sale or Conveyance
Section 9.1. Covenant Not to Merge, Consolidate, Sell or Convey Property Except Under
Certain Conditions.........................................................................54
Section 9.2. Rights and Duties of Successor Corporation.................................................54
Section 9.3. Opinion of Counsel Given to Agent..........................................................55
ARTICLE X
Covenants
Section 10.1. Performance Under Purchase Contracts.......................................................55
Section 10.2. Maintenance of Office or Agency............................................................55
Section 10.3. Company to Reserve Common Stock............................................................56
Section 10.4. Covenants as to Common Stock...............................................................56
Section 10.5. Statements of Officers of the Company as to Default........................................56
Section 10.6. ERISA .....................................................................................56
</TABLE>
-iii-
<PAGE>
<TABLE>
<S> <C>
EXHIBIT A Form of Type A Units Certificate
EXHIBIT B Form of Type B Units Certificate
EXHIBIT C Instruction to Purchase Contract Agent
EXHIBIT D Notice from Purchase Contract Agent to Holders (Transfer of Collateral upon
Occurrence of a Termination Event)
EXHIBIT E Notice to Settle by Separate Cash
EXHIBIT F Notice from Purchase Contract Agent to Collateral Agent and Indenture Trustee
(Payment of Purchase Contract Settlement Price)
</TABLE>
-iv-
<PAGE>
PURCHASE CONTRACT AGREEMENT, dated as of [ ], 1999,
between POLAROID CORPORATION, a Delaware corporation (the "Company"), and
[___________________________], a [______________________] corporation, acting as
purchase contract agent for the Holders of Securities from time to time
(the "Agent").
W I T N E S S E T H :
WHEREAS, the Company has duly authorized the execution and delivery of
this Agreement and the Certificates evidencing the Securities; and
WHEREAS, all things necessary to make the Purchase Contracts (as
defined herein), when the Certificates are executed by the Company and
authenticated, executed on behalf of the Holders (as defined herein) and
delivered by the Agent (as defined herein), as provided in this Agreement, the
valid obligations of the Company, and to constitute these presents a valid
agreement of the Company, in accordance with its terms, have been done;
NOW, THEREFORE, THIS AGREEMENT WITNESSETH: for and in consideration of
the premises and the purchase of the Securities by the Holders thereof, it is
mutually agreed as follows:
ARTICLE I
Definitions and Other Provisions of General Applications
Section 1.1. DEFINITIONS.
For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires:
(a) unless otherwise stated herein, the terms defined in this
Article have the meanings assigned to them in this Article and include
the plural as well as the singular, and nouns and pronouns of the
masculine gender include the feminine and neuter genders;
(b) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted
accounting principles in the United States;
(c) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Agreement as a whole and not to
any particular Article, Section, Exhibit or other subdivision;
(d) the following terms have the meanings given to them in the
Supplemental Indenture: (i) Remarketing; and (ii) Reset Rate; and
<PAGE>
(e) the following terms have the meanings given to them in
this Section 1.1(e):
"Act," when used with respect to any Holder, has the meaning specified
in Section 1.4.
"Adjusted Contract Adjustment Payment Rate," with respect to any Reset
Transaction, means the rate per annum that is the arithmetic average of the
rates quoted by two Reference Dealers selected by the Company or its successor
as the rate at which Contract Adjustment Payments should accrue so that the
fimmediately after the later of (i) public announcement of such Reset
Transaction or (ii) public announcement of a change in dividend policy in
connection with such Reset Transaction will equal the average Trading Price of a
Type A Unit for the 20 Trading Days immediately preceding the date of public
announcement of such Reset Transaction; provided that the Adjusted Contract
Adjustment Payment Rate shall not be less than [____]% per annum.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Agent" means the Person named as the "Agent" in the first paragraph of
this instrument until a successor Agent shall have become such pursuant to the
applicable provisions of this Agreement, and thereafter "Agent" shall mean such
Person.
"Agreement" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable provisions hereof.
"Applicable Market Value" has the meaning specified in Section 5.1.
"Bankruptcy Code" means Title 11 of the United States Code, or any
other law of the United States that from time to time provides a uniform system
of bankruptcy laws.
"Beneficial Owner" means, with respect to a Global Certificate, a
Person who is the beneficial owner of such Book-Entry Interest as reflected on
the books of the Clearing Agency or on the books of a Person maintaining an
account with such Clearing Agency (directly as a Clearing Agency Participant or
as an indirect participant, in each case in accordance with the rules of such
Clearing Agency).
"Board of Directors" means the board of directors of the Company or a
duly authorized committee of that board.
"Board Resolution" means one or more resolutions of the Board of
Directors, a copy of each of which has been certified by the Secretary or an
Assistant Secretary of the Company to
<PAGE>
have been duly adopted by the Board of Directors and to be in full force and
effect on the date of such certification and delivered to the Agent.
"Book-Entry Interest" means a beneficial interest in a Global
Certificate, ownership and transfers of which shall be maintained and made
through book entries by a Clearing Agency as described in Section 3.6.
"Business Day" means any day other than a Saturday or Sunday or a day
on which banking institutions in The City of New York are authorized or required
by law or executive order to remain closed or a day on which the Indenture
Trustee is closed for business; provided that for purposes of the second
paragraph of Section 1.12 only, the term "Business Day" shall also be deemed to
exclude any day on which trading on the New York Stock Exchange, Inc. is closed
or suspended.
"Cash Settlement" has the meaning set forth in Section 5.4(a)(i).
"Certificate" means a Type A Unit Certificate or a Type B Unit
Certificate.
"Clearing Agency" means an organization registered as a "Clearing
Agency" pursuant to Section 17A of the Exchange Act that is acting as a
depositary for the Securities and in whose name, or in the name of a nominee of
that organization, shall be registered a Global Certificate and which shall
undertake to effect book entry transfers and pledges of the Securities.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Price" has the meaning specified in Section 5.1.
"Code" means the Internal Revenue Code of 1986, as amended.
"Collateral" has the meaning specified in Section 1 of the Pledge
Agreement.
"Collateral Account" has the meaning specified in the Pledge Agreement.
"Collateral Agent" means [_____________ ], as Collateral Agent under
the Pledge Agreement until a successor Collateral Agent shall have become
such pursuant to the applicable provisions of the Pledge Agreement, and
thereafter "Collateral Agent" shall mean the Person who is then the
Collateral Agent thereunder.
"Collateral Substitution" has the meaning specified in Section 3.13.
"Common Stock" means the Common Shares, par value $1.00, of the
Company.
<PAGE>
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor shall have become such pursuant
to the applicable provision of this Agreement, and thereafter "Company" shall
mean such successor.
"Contract Adjustment Payments" means, (a) if a Reset Transaction has
not occurred, the fee payable by the Company in respect of each Purchase
Contract, equal to [____]% per annum of the Stated Amount, or (b) following the
occurrence of a Reset Transaction, the Adjusted Contract Adjustment Payment Rate
related to such Reset Transaction until any succeeding Reset Transaction shall
occur, computed (i) for any full quarterly period on the basis of a 360-day year
of twelve 30-day months and (ii) for any period shorter than a full quarterly
period for which such payments are calculated, on the basis of a 30-day month
and, for periods of less than a month, the actual number of days elapsed per
30-day month.
"Type A Units" means the collective rights and obligations of a Holder
of a Type A Unit Certificate in respect of the Debentures, subject to the Pledge
thereof, and the related Purchase Contract.
"Type A Unit Certificate" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of Type A Units specified on
such certificate, substantially in the form of Exhibit A hereto.
"Type A Units Register" and "Type A Units Registrar" have the
respective meanings specified in Section 3.5.
"Corporate Trust Office" means the principal corporate trust office of
the Agent at which, at any particular time, its corporate trust business shall
be administered, which office at the date
hereof is located at [______________] Attention: [______________].
"Coupon Rate" means the percentage rate per annum at which each
Debenture will bear interest initially.
"Current Market Price" has the meaning specified in Section 5.6(a)(8).
"Debentures" means the series of debentures to be issued by the Company
under the Supplemental Indenture.
"Depositary" means DTC until another Clearing Agency becomes its
successor.
"Dividend Yield," on any security for any period, means the dividends
paid or proposed to be paid pursuant to an announced dividend policy on such
security for such period divided by, if with respect to dividends paid on such
security, the average Closing Price of such security during such period and, if
with respect to dividends so proposed to be paid on such security, the Closing
Price of such security on the effective date of the related Reset Transaction.
"DTC" means The Depository Trust Company, the initial Clearing Agency.
<PAGE>
"Early Settlement" has the meaning specified in Section 5.9(a).
"Early Settlement Amount" has the meaning specified in Section 5.9(a).
"Early Settlement Date" has the meaning specified in Section 5.9(a).
"Early Settlement Rate" has the meaning specified in Section 5.9(b).
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Exchange Act" means the Securities Exchange Act of 1934 and any
statute successor thereto, in each case as amended from time to time, and the
rules and regulations promulgated thereunder.
"Expiration Date" has the meaning specified in Section 1.4.
"Expiration Time" has the meaning specified in Section 5.6(a)(6).
"Global Certificate" means a Certificate that evidences all or part of
the Securities and is registered in the name of a Clearing Agency or a nominee
thereof.
"Holder," when used with respect to a Security, means the Person in
whose name the Security evidenced by a Type A Unit Certificate and/or a Type B
Unit Certificate is registered in the related Type A Units Register and/or the
Type B Units Register, as the case may be; PROVIDED, HOWEVER, that in
determining whether the Holders of the requisite number of Type A Units and/or
Type B Units have voted on any matter, then for the purpose of such
determination only (and not for any other purpose hereunder), if the Security
remains in the form of one or more Global Certificates and if the Clearing
Agency which is the holder of such Global Certificate has sent an omnibus proxy
assigning voting rights to the Clearing Agency Participants to whose accounts
the Securities are credited on the record date, the term "Holder" shall mean
such Clearing Agency Participant acting at the direction of the Beneficial
Owners.
"Indenture" means the Indenture, dated as of January 9, 1997, between
the Company and the Indenture Trustee, as amended and supplemented (including
any provisions of the TIA that are deemed incorporated therein and including the
Supplemental Indenture).
"Indenture Trustee" means State Street Bank and Trust Company, a
Massachusetts corporation, as trustee under the Indenture, or any successor
thereto.
"Issuer Order" or "Issuer Request" means a written request or order
signed in the name of the Company by its Chairman of the Board, its President or
one of its Vice Presidents, and by its Treasurer, an Assistant Treasurer, its
Secretary or an Assistant Secretary, and delivered to the Agent.
"NYSE" has the meaning specified in Section 5.1.
<PAGE>
"Officers' Certificate" means a certificate signed by the Chairman of
the Board, its President or one of its Vice Presidents, and by the Treasurer, an
Assistant Treasurer, the Secretary or an Assistant Secretary, of the Company,
and delivered to the Agent. Any Officers' Certificate delivered with respect to
compliance with a condition or covenant provided for in this Agreement shall
include:
(a) a statement that each officer signing the Officers'
Certificate has read the covenant or condition and the definitions
relating thereto;
(b) a brief statement of the nature and scope of the
examination or investigation undertaken by each officer in rendering
the Officers' Certificate;
(c) a statement that each such officer has made such
examination or investigation as, in such officer's opinion, is
necessary to enable such officer to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
officer, such condition or covenant has been complied with.
"Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company (and who may be an employee of the Company), and who
shall be reasonably acceptable to the Agent. An opinion of counsel may rely on
certificates as to matters of fact.
"Outstanding Securities," with respect to any Type A Unit or Type B
Unit, means, as of the date of determination, all Type A Units or Type B Units
evidenced by Certificates theretofore authenticated, executed and delivered
under this Agreement, except:
(i) If a Termination Event has occurred, (A) Type B Units
and (B) Type A Units for which the underlying Debentures have been
theretofore deposited with the Agent in trust for the Holders of such
Type A Units;
(ii) Type A Units and Type B Units evidenced by
Certificates theretofore cancelled by the Agent or delivered to the
Agent for cancellation or deemed cancelled pursuant to the provisions
of this Agreement; and
(iii) Type A Units and Type B Units evidenced by
Certificates in exchange for or in lieu of which other Certificates
have been authenticated, executed on behalf of the Holder and delivered
pursuant to this Agreement, other than any such Certificate in respect
of which there shall have been presented to the Agent proof
satisfactory to it that such Certificate is held by a bona fide
purchaser in whose hands the Type A Units or Type B Units evidenced by
such Certificate are valid obligations of the Company;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
number of the Type A Units or Type B Units have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Type A Units or
Type B Units owned by the Company or any Affiliate of the Company shall be
disregarded and deemed not to be Outstanding Securities,
<PAGE>
except that, in determining whether the Agent shall be protected in relying upon
any such request, demand, authorization, direction, notice, consent or waiver,
only Type A Units or Type B Units which a Responsible Officer of the Agent knows
to be so owned shall be so disregarded. Type A Units or Type B Units so owned
which have been pledged in good faith may be regarded as Outstanding Securities
if the pledgee establishes to the satisfaction of the Agent the pledgee's right
so to act with respect to such Type A Units or Type B Units and that the pledgee
is not the Company or any Affiliate of the Company.
"Payment Date" means each [__________], [__________], [__________] and
[__________], commencing [__________], [_______].
"Permitted Investments" has the meaning set forth in Section 1 of the
Pledge Agreement.
"Person" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint-stock company, limited
liability company, trust, unincorporated organization or government or any
agency or political subdivision thereof or any other entity of whatever nature.
"Units" means the collective reference to the Type A Units and the Type
B Units.
"Plan" means an employee benefit plan that is subject to ERISA, a plan
or individual retirement account that is subject to Section 4975 of the Code or
any entity whose assets are considered assets of any such plan.
"Pledge" means the pledge under the Pledge Agreement of the Debentures
or the Treasury Securities in each case constituting a part of the Securities.
"Pledge Agreement" means the Pledge Agreement, dated as of the date
hereof, by and among the Company, the Collateral Agent, the Securities
Intermediary and the Agent, on its own behalf and as attorney-in-fact for the
Holders from time to time of the Securities.
"Pledged Debentures" has the meaning set forth in the Pledge Agreement.
"Pledged Treasury Securities" has the meaning set forth in the Pledge
Agreement.
"Predecessor Certificate" means a Predecessor Type A Unit Certificate
or a Predecessor Type B Unit Certificate.
"Predecessor Type A Unit Certificate" of any particular Type A Unit
Certificate means every previous Type A Unit Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
Type A Units evidenced thereby; and, for the purposes of this definition, any
Type A Unit Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Type A Unit
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Type A Unit
Certificate.
<PAGE>
"Predecessor Type B Unit Certificate" of any particular Type B Unit
Certificate means every previous Type B Unit Certificate evidencing all or a
portion of the rights and obligations of the Company and the Holder under the
Type B Units evidenced thereby; and, for the purposes of this definition, any
Type B Unit Certificate authenticated and delivered under Section 3.10 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Type B Unit
Certificate shall be deemed to evidence the same rights and obligations of the
Company and the Holder as the mutilated, destroyed, lost or stolen Type B Unit
Certificate.
"Proceeds" has the meaning set forth in Section 1 of the Pledge
Agreement.
"Purchase Contract," when used with respect to any Security, means the
contract forming a part of such Security and obligating the Company to (i) sell
and the Holder of such Security to purchase Common Stock and (ii) pay the Holder
Contract Adjustment Payments, if any, in each case on the terms and subject to
the conditions set forth in Article Five hereof.
"Purchase Contract Settlement Date" means [__________], [____].
"Purchase Contract Settlement Fund" has the meaning specified in
Section 5.5.
"Purchase Price" has the meaning specified in Section 5.1.
"Purchased Shares" has the meaning specified in Section 5.6(a)(6).
"Record Date" for the Contract Adjustment Payments payable on any
Payment Date means, as to any Global Certificate, the Business Day next
preceding such Payment Date, and as to any other Certificate, 15 Business Days
prior to such Payment Date.
"Reference Dealer" means a dealer engaged in the trading of convertible
securities.
"Register" means the Type A Units Register and the Type B Units
Register.
"Registrar" means the Type A Units Registrar and the Type B Units
Registrar.
"Remarketing Agent" has the meaning specified in Section 5.4(b).
"Remarketing Agreement" means the Remarketing Agreement dated as of
[__________], by and between the Company and the Remarketing Agent.
"Reorganization Event" has the meaning specified in Section 5.6(b).
"Reset Transaction" means a merger, consolidation or statutory share
exchange to which the Person that is the issuer of the common shares for which
the Purchase Contracts are then to be settled is a party, a sale of all or
substantially all assets of such Person, a recapitalization of such commonshares
or a distribution described in Section 5.6(a)(4) by such Person and after the
effective date of such transaction the Purchase Contracts are then to be settled
for common shares of a Person (i) which had a Dividend Yield for the four fiscal
quarters immediately preceding the
<PAGE>
public announcement thereof which was, or (ii) that announces a dividend policy
prior to the effective date thereof which policy, if implemented, would result
in a Dividend Yield on such common shares for the next four fiscal quarters
which would be, more than 250 basis points higher than the Dividend Yield on the
common shares for which the Purchase Contracts are to be settled prior to such
effective date for the four fiscal quarters immediately preceding such public
announcement.
"Responsible Officer," when used with respect to the Agent, means any
officer of the Agent assigned by the Agent to administer its corporate trust
matters.
"Security" means a Type A Unit or a Type B Unit.
"Securities Intermediary" means [_____________________], as Securities
Intermediary under the Pledge Agreement until a successor Securities
Intermediary shall have become such pursuant to the applicable provisions of the
Pledge Agreement, and thereafter "Securities Intermediary" shall mean such
successor.
"Settlement Rate" has the meaning specified in Section 5.1.
"Stated Amount" means $[50] in cash.
"Supplemental Indenture" means the Supplemental Indenture, dated as of
________ __, 1999, between the Company and the Trustee, supplementing the
Indenture and pursuant to which the Debentures will be issued.
"Termination Date" means the date, if any, on which a Termination Event
occurs.
"Termination Event" means the occurrence of any of the following
events: (i) at any time on or prior to the Purchase Contract Settlement Date, a
judgment, decree or court order shall have been entered granting relief with
respect to the Company under the Bankruptcy Code or any other similar applicable
Federal or State law, adjudicating the Company to be insolvent, or approving as
properly filed a petition seeking reorganization or liquidation of the Company,
and, unless such judgment, decree or order shall have been entered within 60
days prior to the Purchase Contract Settlement Date, such decree or order shall
have continued undischarged and unstayed for a period of 60 days; or (ii) a
judgment, decree or court order for the appointment of a receiver or liquidator
or trustee or assignee in bankruptcy or insolvency of the Company or of its
property, or for the winding up or liquidation of its affairs, shall have been
entered, and, unless such judgment, decree or order shall have been entered
within 60 days prior to the Purchase Contract Settlement Date, such judgment,
decree or order shall have continued undischarged and unstayed for a period of
60 days; or (iii) at any time on or prior to the Purchase Contract Settlement
Date, the Company shall file a petition for relief under the Bankruptcy Code, or
shall consent to the filing of a bankruptcy proceeding against it, or shall file
a petition or answer or consent seeking reorganization or liquidation of the
Company under the Bankruptcy Code or any other similar applicable Federal or
State law, or shall consent to the filing of any such petition, or shall consent
to the appointment of a receiver or liquidator or trustee or assignee
<PAGE>
in bankruptcy or insolvency of it or of its property, or shall make an
assignment for the benefit of its creditors, or shall admit in writing its
inability to pay its debts generally as they become due.
"Threshold Appreciation Price" has the meaning specified in Section
5.1.
"TIA" means the Trust Indenture Act of 1939, as amended from time to
time, or any successor legislation.
"Trading Day" has the meaning specified in Section 5.1.
"Trading Price" of a security on any date of determination means (i)
the closing sale price (or, if no closing price is reported, the last reported
sale price) of a security (regular way) on the NYSE on such date, (ii) if such
security is not listed for trading on the NYSE on any such date, the closing
sale price as reported in the composite transactions for the principal United
States securities exchange on which such security is so listed, (iii) if such
security is not so listed on a United States national or regional securities
exchange, the closing sale price as reported by The NASDAQ Stock Market, (iv) if
such security is not so reported, the price quoted by Interactive Data
Corporation for such security or, if Interactive Data Corporation is not quoting
such price, a similar quotation service selected by the Company, (v) if such
security is not so quoted, the average of the mid-point of the last bid and ask
prices for such security from at least two dealers recognized as market-makers
for such security, or (vi) if such security is not so quoted, the average of the
last bid and ask prices for such security from a Reference Dealer.
"Treasury Security" means zero-coupon U.S. Treasury Securities (Cusip
Number ________) which are the principal strip of the __% U. S. Treasury
Securities which mature on [___________], [____________].
"Type A Register" and "Type A Registrar" have the respective meanings
specified in Section 3.5.
"Type A Units" means the collective rights and obligations of a Holder
of a Type A Unit Certificate in respect of the Debentures subject to the Pledge
thereof, and the related Purchase Contract.
"Type B Units" means, following the substitution of one or more
Treasury Securities for Debentures as collateral to secure a holder's
obligations under a Purchase Contract, the collective rights and obligations of
a Holder of a Type B Unit Certificate in respect of such Treasury Securities,
subject in each case to the Pledge thereof, and the related Purchase Contract.
"Type A Unit Certificate" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of Type A Units specified on
such certificate, substantially in the form of Exhibit A hereto.
"Type B Unit Certificate" means a certificate evidencing the rights and
obligations of a Holder in respect of the number of Type B Units specified on
such certificate, substantially in the form of Exhibit A hereto.
<PAGE>
"Type A Units Register" and "Type A Units Registrar" have the
respective meanings specified in Section 3.5.
"Type B Units Register" and "Type B Units Registrar" have the
respective meanings specified in Section 3.5.
"Underwriting Agreement" means the Underwriting Agreement dated
[_________], [ ] among the Company, [ ].
"Vice President" means any vice president, whether or not designated by
a number or a word or words added before or after the title "vice president."
Section 1.2. COMPLIANCE CERTIFICATES AND OPINIONS.
Except as otherwise expressly provided by this Agreement, upon any
application or request by the Company to the Agent to take any action in
accordance with any provision of this Agreement, the Company shall furnish to
the Agent an Officers' Certificate stating that all conditions precedent, if
any, provided for in this Agreement relating to the proposed action have been
complied with and, if requested by the Agent, an Opinion of Counsel stating
that, in the opinion of such counsel, all such conditions precedent, if any,
have been complied with, except that in the case of any such application or
request as to which the furnishing of such documents is specifically required by
any provision of this Agreement relating to such particular application or
request, no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Agreement shall include:
(1) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of each such individual,
he or she has made such examination or investigation as is necessary to
enable such individual to express an informed opinion as to whether or
not such covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with.
Section 1.3. FORM OF DOCUMENTS DELIVERED TO AGENT.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the
<PAGE>
opinion of, only one such Person, or that they be so certified or covered by
only one document, but one such Person may certify or give an opinion with
respect to some matters and one or more other such Persons as to other matters,
and any such Person may certify or give an opinion as to such matters in one or
several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Agreement, they may, but need not, be consolidated and
form one instrument.
Section 1.4. ACTS OF HOLDERS; RECORD DATES.
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Agreement to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Agent and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or of
a writing appointing any such agent shall be sufficient for any purpose of this
Agreement and, subject to Section 7.1, conclusive in favor of the Agent and the
Company, if made in the manner provided in this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved in any manner which the Agent deems
sufficient.
(c) The ownership of Securities shall be proved by the Type A Units
Register or the Type B Units Register, as the case may be.
(d) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Certificate shall bind every future
Holder of the same Certificate and the Holder of every Certificate issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Agent or the
Company in reliance thereon, whether or not notation of such action is made upon
such Certificate.
<PAGE>
(e) The Company may set any day as a record date for the purpose of
determining the Holders of Outstanding Securities entitled to give, make or take
any request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Agreement to be given, made or taken by
Holders of Securities. If any record date is set pursuant to this paragraph, the
Holders of the Outstanding Type A Units and the Outstanding Type B Units, as the
case may be, on such record date, and no other Holders, shall be entitled to
take the relevant action with respect to the Type A Units or the Type B Units,
as the case may be, whether or not such Holders remain Holders after such record
date; provided that no such action shall be effective hereunder unless taken on
or prior to the applicable Expiration Date by Holders of the requisite number of
Outstanding Securities on such record date. Nothing in this paragraph shall be
construed to prevent the Company from setting a new record date for any action
for which a record date has previously been set pursuant to this paragraph
(whereupon the record date previously set shall automatically and with no action
by any Person be cancelled and be of no effect), and nothing in this paragraph
shall be construed to render ineffective any action taken by Holders of the
requisite number of Outstanding Securities on the date such action is taken.
Promptly after any record date is set pursuant to this paragraph, the Company,
at its own expense, shall cause notice of such record date, the proposed action
by Holders and the applicable Expiration Date to be given to the Agent in
writing and to each Holder of Securities in the manner set forth in Section 1.6.
With respect to any record date set pursuant to this Section, the
Company may designate any date as the "Expiration Date" and from time to time
may change the Expiration Date to any earlier or later day; provided that no
such change shall be effective unless notice of the proposed new Expiration Date
is given to the Agent in writing, and to each Holder of Securities in the manner
set forth in Section 1.6, on or prior to the existing Expiration Date. If an
Expiration Date is not designated with respect to any record date set pursuant
to this Section, the Company shall be deemed to have initially designated the
180th day after such record date as the Expiration Date with respect thereto,
subject to its right to change the Expiration Date as provided in this
paragraph. Notwithstanding the foregoing, no Expiration Date shall be later than
the 180th day after the applicable record date.
Section 1.5. NOTICES.
Any notice or communication is duly given if in writing and delivered
in Person or mailed by first class mail (registered or certified, return receipt
requested), telecopier (with receipt confirmed) or overnight air courier
guaranteeing next day delivery, to the others' address; provided that notice
shall be deemed given to the Agent only upon receipt thereof:
If to the Agent:
Telecopier No.:
Attention:
<PAGE>
If to the Company:
Telecopier No.:
Attention:
If to the Collateral Agent:
Telecopier No.:
Attention:
If to the Indenture Trustee:
Telecopier No.:
Attention:
Section 1.6. NOTICE TO HOLDERS; WAIVER.
Where this Agreement provides for notice to Holders of any event, such
notice shall be sufficiently given (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to each Holder affected
by such event, at its address as it appears in the applicable Register, not
later than the latest date, and not earlier than the earliest date, prescribed
for the giving of such notice. In any case where notice to Holders is given by
mail, neither the failure to mail such notice, nor any defect in any notice so
mailed to any particular Holder shall affect the sufficiency of such notice with
respect to other Holders. Where this Agreement provides for notice in any
manner, such notice may be waived in writing by the Person entitled to receive
such notice, either before or after the event, and such waiver shall be the
equivalent of such notice. Waivers of notice by Holders shall be filed with the
Agent, but such filing shall not be a condition precedent to the validity of any
action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Agent shall
constitute a sufficient notification for every purpose hereunder.
Section 1.7. EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
<PAGE>
Section 1.8. SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Agreement by the Company shall
bind its successors and assigns, whether so expressed or not.
Section 1.9. SEPARABILITY CLAUSE.
In case any provision in this Agreement or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions hereof and thereof shall not in any way be affected or
impaired thereby.
Section 1.10. BENEFITS OF AGREEMENT.
Nothing in this Agreement or in the Securities, express or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and, to the extent provided hereby, the Holders, any benefits or any
legal or equitable right, remedy or claim under this Agreement. The Holders from
time to time shall be beneficiaries of this Agreement and shall be bound by all
of the terms and conditions hereof and of the Securities evidenced by their
Certificates by their acceptance of delivery of such Certificates.
Section 1.11. GOVERNING LAW.
This Agreement and the Securities shall be governed by and construed in
accordance with the laws of the State of New York.
Section 1.12. LEGAL HOLIDAYS.
In any case where any Payment Date shall not be a Business Day, then
(notwithstanding any other provision of this Agreement or the Type A Unit
Certificates or the Type B Unit Certificates) payment of the Contract Adjustment
Payments, if any, shall not be made on such date, but such payments shall be
made on the next succeeding Business Day with the same force and effect as if
made on such Payment Date, provided that no interest shall accrue or be payable
by the Company or any Holder for the period from and after any such Payment
Date, except that, if such next succeeding Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately
preceding Business Day with the same force and effect as if made on such Payment
Date.
In any case where any Purchase Contract Settlement Date shall not be a
Business Day, then (notwithstanding any other provision of this Agreement, the
Type A Unit Certificates or the Type B Unit Certificates) Purchase Contracts
shall not be performed on such date, but the Purchase Contracts shall be
performed on the immediately following Business Day with the same force and
effect as if performed on the Purchase Contract Settlement Date.
<PAGE>
Section 1.13. COUNTERPARTS.
This Agreement may be executed in any number of counterparts by the
parties hereto on separate counterparts, each of which, when so executed and
delivered, shall be deemed an original, but all such counterparts shall together
constitute one and the same instrument.
Section 1.14. INSPECTION OF AGREEMENT.
A copy of this Agreement shall be available at all reasonable times
during normal business hours at the Corporate Trust Office for inspection by any
Holder or Beneficial Owner.
ARTICLE II
Certificate Forms
Section 2.1. FORMS OF CERTIFICATES GENERALLY.
The Type A Unit Certificates (including the form of Purchase Contract
forming part of the Type A Units evidenced thereby) shall be in substantially
the form set forth in Exhibit A hereto, with such letters, numbers or other
marks of identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Type A Units are listed or any depositary
therefor, or as may, consistently herewith, be determined by the officers of the
Company executing such Type A Unit Certificates, as evidenced by their execution
of the Type A Unit Certificates.
The definitive Type A Unit Certificates shall be printed, lithographed
or engraved on steel engraved borders or may be produced in any other manner,
all as determined by the officers of the Company executing the Type A Units
evidenced by such Type A Unit Certificates, consistent with the provisions of
this Agreement, as evidenced by their execution thereof.
The Type B Unit Certificates (including the form of Purchase Contracts
forming part of the Type B Units evidenced thereby) shall be in substantially
the form set forth in Exhibit B hereto, with such letters, numbers or other
marks of identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Type B Units may be listed or any depositary
therefor, or as may, consistently herewith, be determined by the officers of the
Company executing such Type B Unit Certificates, as evidenced by their execution
of the Type B Unit Certificates.
The definitive Type B Unit Certificates shall be printed, lithographed
or engraved on steel engraved borders or may be produced in any other manner,
all as determined by the officers of the Company executing the Type B Units
evidenced by such Type B Unit Certificates, consistent with the provisions of
this Agreement, as evidenced by their execution thereof.
<PAGE>
Every Global Certificate authenticated, executed on behalf of the
Holders and delivered hereunder shall bear a legend in substantially the
following form:
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED
IN THE NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
(THE "DEPOSITARY"), OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS
EXCHANGEABLE FOR CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER
THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE PURCHASE CONTRACT AGREEMENT AND NO TRANSFER OF THIS
CERTIFICATE (OTHER THAN A TRANSFER OF THIS CERTIFICATE AS A WHOLE BY
THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY
BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REQUESTED IN THE NAME OF CEDE & CO. OR SUCH
OTHER NAME AS REGISTERED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
Section 2.2. FORM OF AGENT'S CERTIFICATE OF AUTHENTICATION.
The form of the Agent's certificate of authentication of the Type A
Units shall be in substantially the form set forth on the form of the Type A
Unit Certificates.
The form of the Agent's certificate of authentication of the Type B
Units shall be in substantially the form set forth on the form of the Type B
Unit Certificates.
<PAGE>
ARTICLE III
The Securities
Section 3.1. AMOUNT; FORM AND DENOMINATIONS.
The aggregate number of Securities evidenced by Certificates
authenticated, executed on behalf of the Holders and delivered hereunder is
limited to [__________] except for Certificates authenticated, executed and
delivered upon registration of transfer of, in exchange for, or in lieu of,
other Certificates pursuant to Section 3.4, 3.5, 3.10, 3.13, 3.14, 5.9 or 8.5.
The Certificates shall be issuable only in registered form and only in
denominations of a single Type A Unit or Type B Unit and any integral multiple
thereof.
Section 3.2. RIGHTS AND OBLIGATIONS EVIDENCED BY THE CERTIFICATES.
Each Type A Unit Certificate shall evidence the number of Type A Units
specified therein, with each such Type A Unit representing the ownership by the
Holder thereof of a beneficial interest in a Debenture, subject to the Pledge of
such Debenture by such Holder pursuant to the Pledge Agreement, and the rights
and obligations of the Holder thereof and the Company under one Purchase
Contract. The Agent as attorney-in-fact for, and on behalf of, the Holder of
each Type A Unit shall pledge, pursuant to the Pledge Agreement, the Debenture,
forming a part of such Type A Unit, to the Collateral Agent and grant to the
Collateral Agent a security interest in the right, title and interest of such
Holder in such Debenture for the benefit of the Company, to secure the
obligation of the Holder under each Purchase Contract to purchase the Common
Stock of the Company. Prior to the purchase of shares of Common Stock under each
Purchase Contract, such Purchase Contracts shall not entitle the Holder of a
Type A Unit Certificate to any of the rights of a holder of shares of Common
Stock, including, without limitation, the right to vote or receive any dividends
or other payments or to consent or to receive notice as a stockholder in respect
of the meetings of stockholders or for the election of directors of the Company
or for any other matter, or any other rights whatsoever as a stockholder of the
Company.
Each Type B Unit Certificate shall evidence the number of Type B Units
specified therein, with each such Type B Unit representing the ownership by the
Holder thereof of a 1/20 undivided beneficial interest in a Treasury Security
with a principal amount equal to $1,000, subject to the Pledge of such Treasury
Security by such Holder pursuant to the Pledge Agreement, and the rights and
obligations of the Holder thereof and the Company under one Purchase Contract.
Prior to the purchase, if any, of shares of Common Stock under each Purchase
Contract, such Purchase Contract shall not entitle the Holder of a Type B Unit
Certificate to any of the rights of a holder of shares of Common Stock,
including, without limitation, the right to vote or receive any dividends or
other payments or to consent or to receive notice as a stockholder in respect of
the meetings of stockholders or for the election of directors of the Company or
for any other matter, or any other rights whatsoever as a stockholder of the
Company.
<PAGE>
Section 3.3. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
Subject to the provisions of Sections 3.13 and 3.14 hereof, upon the
execution and delivery of this Agreement, and at any time and from time to time
thereafter, the Company may deliver Certificates executed by the Company to the
Agent for authentication, execution on behalf of the Holders and delivery,
together with its Issuer Order for authentication of such Certificates, and the
Agent in accordance with such Issuer Order shall authenticate, execute on behalf
of the Holders and deliver such Certificates.
The Certificates shall be executed on behalf of the Company by its
Chairman of the Board, its President or one of its Vice Presidents. The
signature of any of these officers on the Certificates may be manual or
facsimile.
Certificates bearing the manual or facsimile signatures of individuals
who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Certificates or did not
hold such offices at the date of such Certificates
No Purchase Contract evidenced by a Certificate shall be valid until
such Certificate has been executed on behalf of the Holder by the manual
signature of an authorized signatory of the Agent, as such Holder's
attorney-in-fact. Such signature by an authorized signatory of the Agent shall
be conclusive evidence that the Holder of such Certificate has entered into the
Purchase Contracts evidenced by such Certificate.
Each Certificate shall be dated the date of its authentication.
No Certificate shall be entitled to any benefit under this Agreement or
be valid or obligatory for any purpose unless there appears on such Certificate
a certificate of authentication substantially in the form provided for herein
executed by an authorized signatory of the Agent by manual signature, and such
certificate upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder.
Section 3.4. TEMPORARY CERTIFICATES.
Pending the preparation of definitive Certificates, the Company shall
execute and deliver to the Agent, and the Agent shall authenticate, execute on
behalf of the Holders, and deliver, in lieu of such definitive Certificates,
temporary Certificates which are in substantially the form set forth in Exhibit
A or Exhibit B hereto, as the case may be, with such letters, numbers or other
marks of identification or designation and such legends or endorsements printed,
lithographed or engraved thereon as may be required by the rules of any
securities exchange on which the Type A Units or Type B Units are listed, or as
may, consistently herewith, be determined by the officers of the Company
executing such Certificates, as evidenced by their execution of the
Certificates.
If temporary Certificates are issued, the Company will cause definitive
Certificates to be prepared without unreasonable delay. After the preparation of
definitive Certificates, the temporary Certificates shall be exchangeable for
definitive Certificates upon surrender of the
<PAGE>
temporary Certificates at the Corporate Trust Office, at the expense of the
Company and without charge to the Holder. Upon surrender for cancellation of any
one or more temporary Certificates, the Company shall execute and deliver to the
Agent, and the Agent shall authenticate, execute on behalf of the Holder, and
deliver in exchange therefor, one or more definitive Certificates of like tenor
and denominations and evidencing a like aggregate number of Type A Units or Type
B Units, as the case may be, as the temporary Certificate or Certificates so
surrendered. Until so exchanged, the temporary Certificates shall in all
respects evidence the same benefits and the same obligations with respect to the
Type A Units or Type B Units, as the case may be, evidenced thereby as
definitive Certificates.
Section 3.5. REGISTRATION; REGISTRATION OF TRANSFER AND EXCHANGE.
The Agent shall keep at the Corporate Trust Office a register (the
"Type A Units Register") in which, subject to such reasonable regulations as it
may prescribe, the Agent shall provide for the registration of Type A Unit
Certificates and of transfers of Type A Unit Certificates (the Agent, in such
capacity, the "Type A Units Registrar") and a register (the "Type B Units
Register") in which, subject to such reasonable regulations as it may prescribe,
the Agent shall provide for the registration of the Type B Unit Certificates and
transfers of Type B Unit Certificates (the Agent, in such capacity, the "Type B
Units Registrar").
Upon surrender for registration of transfer of any Certificate at the
Corporate Trust Office, the Company shall execute and deliver to the Agent, and
the Agent shall authenticate, execute on behalf of the designated transferee or
transferees, and deliver, in the name of the designated transferee or
transferees, one or more new Certificates of any authorized denominations, like
tenor, and evidencing a like aggregate number of Type A Units or Type B Units,
as the case may be.
At the option of the Holder, Certificates may be exchanged for other
Certificates, of any authorized denominations and evidencing a like number of
Type A Units or Type B Units, as the case may be, upon surrender of the
Certificates to be exchanged at the Corporate Trust Office. Whenever any
Certificates are so surrendered for exchange, the Company shall execute and
deliver to the Agent, and the Agent shall authenticate, execute on behalf of the
Holder, and deliver the Certificates which the Holder making the exchange is
entitled to receive.
All Certificates issued upon any registration of transfer or exchange
of a Certificate shall evidence the ownership of the same aggregate number of
Type A Units or Type B Units, as the case may be, and be entitled to the same
benefits and subject to the same obligations, under this Agreement as the Type A
Units or Type B Units, as the case may be, evidenced by the Certificate
surrendered upon such registration of transfer or exchange.
Every Certificate presented or surrendered for registration of transfer
or for exchange shall (if so required by the Agent) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Agent duly executed, by the Holder thereof or its attorney duly
authorized in writing.
<PAGE>
No service charge shall be made for any registration of transfer or
exchange of a Certificate, but the Company and the Agent may require payment
from the Holder of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Certificates, other than any exchanges pursuant to Sections 3.10 and
8.5 not involving any transfer.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the Holder and deliver any Certificate in
exchange for any other Certificate presented or surrendered for registration of
transfer or for exchange on or after the Business Day immediately preceding the
earlier of the Purchase Contract Settlement Date or the Termination Date. In
lieu of delivery of a new Certificate, upon satisfaction of the applicable
conditions specified above in this Section and receipt of appropriate
registration or transfer instructions from such Holder, the Agent shall (i) if
the Purchase Contract Settlement Date has occurred, deliver the shares of Common
Stock issuable in respect of the Purchase Contracts forming a part of the
Securities evidenced by such other Certificate or (ii) if a Termination Event
shall have occurred prior to the Purchase Contract Settlement Date, transfer the
Debentures or the Treasury Securities, as the case may be, evidenced thereby, in
each case subject to the applicable conditions and in accordance with the
applicable provisions of Article Five hereof.
Section 3.6. BOOK-ENTRY INTERESTS.
The Certificates, on original issuance, will be issued in the form of
one or more fully registered Global Certificates, to be delivered to the
Depositary by, or on behalf of, the Company. Such Global Certificate shall
initially be registered on the books and records of the Company in the name of
Cede & Co., the nominee of the Depositary, and no Beneficial Owner will receive
a definitive Certificate representing such Beneficial Owner's interest in such
Global Certificate, except as provided in Section 3.9. The Agent shall enter
into an agreement with the Depositary if so requested by the Company. Unless and
until definitive, fully registered Certificates have been issued to Beneficial
Owners pursuant to Section 3.9:
(a) the provisions of this Section 3.6 shall be in full force
and effect;
(b) the Company shall be entitled to deal with the Clearing
Agency for all purposes of this Agreement (including the payment of
Contract Adjustment Payments, if any, and receiving approvals, votes or
consents hereunder) as the Holder of the Securities and the sole holder
of the Global Certificate(s) and shall have no obligation to the
Beneficial Owners;
(c) to the extent that the provisions of this Section 3.6
conflict with any other provisions of this Agreement, the provisions of
this Section 3.6 shall control; and
(d) the rights of the Beneficial Owners shall be exercised
only through the Clearing Agency and shall be limited to those
established by law and agreements between such Beneficial Owners and
the Clearing Agency and/or the Clearing Agency Participants.
<PAGE>
Section 3.7. NOTICES TO HOLDERS.
Whenever a notice or other communication to the Holders is required to
be given under this Agreement, the Company or the Company's agent shall give
such notices and communications to the Holders and, with respect to any
Securities registered in the name of a Clearing Agency or the nominee of a
Clearing Agency, the Company or the Company's agent shall, except as set forth
herein, have no obligations to the Beneficial Owners.
Section 3.8. APPOINTMENT OF SUCCESSOR CLEARING AGENCY.
If any Clearing Agency elects to discontinue its services as securities
depositary with respect to the Securities, the Company may, in its sole
discretion, appoint a successor Clearing Agency with respect to the Securities.
Section 3.9. DEFINITIVE CERTIFICATES.
If (i) a Clearing Agency elects to discontinue its services as
securities depositary with respect to the Securities and a successor Clearing
Agency is not appointed within 90 days after such discontinuance pursuant to
Section 3.8 or (ii) there shall have occurred and be continuing a default by the
Company in respect of its obligations under one or more Purchase Contracts, then
upon surrender of the Global Certificates representing the Securities by the
Clearing Agency, accompanied by registration instructions, the Company shall
cause definitive Certificates to be delivered to Beneficial Owners in accordance
with the instructions of the Clearing Agency. The Company shall not be liable
for any delay in delivery of such instructions and may conclusively rely on and
shall be protected in relying on, such instructions.
Section 3.10. MUTILATED, DESTROYED, LOST AND STOLEN CERTIFICATES.
If any mutilated Certificate is surrendered to the Agent, the Company
shall execute and deliver to the Agent, and the Agent shall authenticate,
execute on behalf of the Holder, and deliver in exchange therefor, a new
Certificate, evidencing the same number of Type A Units or Type B Units, as the
case may be, and bearing a Certificate number not contemporaneously outstanding.
If there shall be delivered to the Company and the Agent (i) evidence
to their satisfaction of the destruction, loss or theft of any Certificate, and
(ii) such security or indemnity as may be required by them to hold each of them
and any agent of any of them harmless, then, in the absence of notice to the
Company or the Agent that such Certificate has been acquired by a bona fide
purchaser, the Company shall execute and deliver to the Agent, and the Agent
shall authenticate, execute on behalf of the Holder, and deliver to the Holder,
in lieu of any such destroyed, lost or stolen Certificate, a new Certificate,
evidencing the same number of Type A Units or Type B Units, as the case may be,
and bearing a Certificate number not contemporaneously outstanding.
Notwithstanding the foregoing, the Company shall not be obligated to
execute and deliver to the Agent, and the Agent shall not be obligated to
authenticate, execute on behalf of the
<PAGE>
Holder, and deliver to the Holder, a Certificate on or after the Business Day
immediately preceding the earlier of the Purchase Contract Settlement Date or
the Termination Date. In lieu of delivery of a new Certificate, upon
satisfaction of the applicable conditions specified above in this Section and
receipt of appropriate registration or transfer instructions from such Holder,
the Agent shall (i) if the Purchase Contract Settlement Date has occurred,
deliver the shares of Common Stock issuable in respect of the Purchase Contracts
forming a part of the Securities evidenced by such Certificate, or (ii) if a
Termination Event shall have occurred prior to the Purchase Contract Settlement
Date, transfer the Debentures or the Treasury Securities, as the case may be,
evidenced thereby, in each case subject to the applicable conditions and in
accordance with the applicable provisions of Article Five hereof.
Upon the issuance of any new Certificate under this Section, the
Company and the Agent may require the payment by the Holder of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other expenses (including the fees and expenses of the Agent)
connected therewith.
Every new Certificate issued pursuant to this Section in lieu of any
destroyed, lost or stolen Certificate shall constitute an original additional
contractual obligation of the Company and of the Holder in respect of the
Security evidenced thereby, whether or not the destroyed, lost or stolen
Certificate (and the Securities evidenced thereby) shall be at any time
enforceable by anyone, and shall be entitled to all the benefits and be subject
to all the obligations of this Agreement equally and proportionately with any
and all other Certificates delivered hereunder.
The provisions of this Section are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Certificates.
Section 3.11. PERSONS DEEMED OWNERS.
Prior to due presentment of a Certificate for registration of transfer,
the Company and the Agent, and any agent of the Company or the Agent, may treat
the Person in whose name such Certificate is registered as the owner of the Type
A Units or Type B Units evidenced thereby, for the purpose of receiving interest
on the Debentures, receiving payments of Contract Adjustment Payments,
performance of the Purchase Contracts and for all other purposes whatsoever,
whether or not any interest on the Debentures or the Contract Adjustment
Payments payable in respect of the Purchase Contracts constituting a part of the
Type A Units or Type B Units evidenced thereby shall be overdue and
notwithstanding any notice to the contrary, and neither the Company nor the
Agent, nor any agent of the Company or the Agent, shall be affected by notice to
the contrary.
Notwithstanding the foregoing, with respect to any Global Certificate,
nothing herein shall prevent the Company, the Agent or any agent of the Company
or the Agent, from giving effect to any written certification, proxy or other
authorization furnished by any Clearing Agency (or its nominee), as a Holder,
with respect to such Global Certificate or impair, as between such Clearing
Agency and owners of beneficial interests in such Global Certificate, the
operation of customary practices governing the exercise of rights of such
Clearing Agency (or its nominee) as Holder of such Global Certificate.
<PAGE>
Section 3.12. CANCELLATION.
All Certificates surrendered for delivery of shares of Common Stock on
or after the Purchase Contract Settlement Date, upon the transfer of Debentures
or Treasury Securities, as the case may be, after the occurrence of a
Termination Event or pursuant to an Early Settlement, or upon the registration
of a transfer or exchange of a Security, or a Collateral Substitution or the
re-establishment of a Type A Unit shall, if surrendered to any Person other than
the Agent, be delivered to the Agent and, if not already cancelled, shall be
promptly cancelled by it. The Company may at any time deliver to the Agent for
cancellation any Certificates previously authenticated, executed and delivered
hereunder which the Company may have acquired in any manner whatsoever, and all
Certificates so delivered shall, upon Issuer Order, be promptly cancelled by the
Agent. No Certificates shall be authenticated, executed on behalf of the Holder
and delivered in lieu of or in exchange for any Certificates cancelled as
provided in this Section, except as expressly permitted by this Agreement. All
cancelled Certificates held by the Agent shall be destroyed by the Agent unless
otherwise directed by Issuer Order.
If the Company or any Affiliate of the Company shall acquire any
Certificate, such acquisition shall not operate as a cancellation of such
Certificate unless and until such Certificate is delivered to the Agent
cancelled or for cancellation.
Section 3.13. SUBSTITUTION OF SECURITIES.
A Holder may separate the Debentures from the related Purchase
Contracts in respect of a Type A Unit by substituting, for such Debentures,
Treasury Securities in an aggregate principal amount equal to the aggregate
principal amount of such Debentures (a "Collateral Substitution"), at any time
from and after the date of this Agreement and on or prior to the seventh
Business Day immediately preceding the Purchase Contract Settlement Date by (a)
depositing with the Securities Intermediary Treasury Securities or securities
entitlements thereto having an aggregate principal amount equal to the aggregate
principal amount of the Debentures comprising part of such Type A Units and (b)
transferring the related Type A Units to the Agent accompanied by a notice to
the Agent, substantially in the form of Exhibit C hereto, stating that the
Holder has transferred the relevant amount of Treasury Securities to the
Securities Intermediary and requesting that the Agent instruct the Collateral
Agent to release the Debentures underlying such Type A Units, whereupon the
Agent shall promptly give such instruction to the Collateral Agent,
substantially in the form of Exhibit A to the Pledge Agreement. Upon receipt of
the Treasury Securities described in clause (a) above and the instruction
described in clause (b) above, in accordance with the terms of the Pledge
Agreement, the Collateral Agent will cause the Securities Intermediary to
release from the Pledge to the Agent, on behalf of the Holder, Debentures having
a corresponding aggregate principal amount, free and clear of the Company's
security interest therein, and upon receipt thereof the Agent shall promptly:
(i) cancel the related Type A Units;
(ii) transfer the Debentures to the Holder; and
<PAGE>
(iii) authenticate, execute on behalf of such Holder and
deliver a Type B Unit Certificate executed by the Company in accordance
with Section 3.3 evidencing the same number of Purchase Contracts as
were evidenced by the cancelled Type A Units.
Holders who elect to separate the Debentures from the related Purchase
Contract and to substitute Treasury Securities for such Debentures shall be
responsible for any fees or expenses payable to the Collateral Agent for its
services as Collateral Agent in respect of the substitution, and the Company
shall not be responsible for any such fees or expenses.
Holders may make Collateral Substitutions only in integral multiples of
20 Type A Units if Treasury Securities are being substituted for Debentures.
In the event a Holder making a Collateral Substitution pursuant to this
Section 3.13 fails to effect a book-entry transfer of the Type A Unit or fails
to deliver a Type A Unit Certificate(s) to the Agent after depositing Treasury
Securities with the Collateral Agent, the Debentures, constituting a part of
such Type A Unit, and any interest on such Debentures, shall be held in the name
of the Agent or its nominee in trust for the benefit of such Holder, until such
Type A Unit is so transferred or the Type A Unit Certificate is so delivered, as
the case may be, or, with respect to a Type A Unit Certificate, such Holder
provides evidence satisfactory to the Company and the Agent that such Type A
Unit Certificate has been destroyed, lost or stolen, together with any indemnity
that may be required by the Agent and the Company.
Except as described in this Section 3.13, for so long as the Purchase
Contract underlying a Type A Unit remains in effect, such Type A Unit shall not
be separable into its constituent parts, and the rights and obligations of the
Holder in respect of the Debentures and the Purchase Contract comprising such
Type A Unit may be acquired, and may be transferred and exchanged, only as a
Type A Unit.
Section 3.14. REESTABLISHMENT OF TYPE A UNITS.
A Holder of a Type B Unit may recreate Type A Unit at any time on or
prior to the seventh Business Day immediately preceding the Purchase Contract
Settlement Date by (a) depositing with the Securities Intermediary Debentures or
security entitlements thereto having an aggregate principal amount equal to the
aggregate principal amount at maturity of the Treasury Securities comprising
part of the Type B Units and (b) transferring the related Type B Units to the
Agent accompanied by a notice to the Agent, substantially in the form of Exhibit
C hereto, stating that the Holder has transferred the relevant amount of
Debentures to the Securities Intermediary and requesting that the Agent instruct
the Collateral Agent to release the Treasury Securities underlying such Type B
Units, whereupon the Agent shall promptly give such instruction to the
Collateral Agent, substantially in the form of Exhibit C to the Pledge
Agreement. Upon receipt of the Debentures described in clause (a) above and the
instruction described in clause (b) above, in accordance with the terms of the
Pledge Agreement, the Collateral Agent will cause the Securities Intermediary to
effect the release of the Treasury Securities having a corresponding aggregate
principal amount at maturity from the Pledge to the Agent free and clear of the
Company's security interest therein, and upon receipt thereof the Agent shall
promptly:
<PAGE>
(i) cancel the related Type B Units;
(ii) transfer the Treasury Securities to the Holder;
and
(iii) authenticate, execute on behalf of such Holder and
deliver a Type A Unit Certificate executed by the Company in accordance
with Section 3.3 evidencing the same number of Purchase Contracts as
were evidenced by the cancelled Type B Units.
Holders who elect to recreate Type A Units shall be responsible for any
fees or expenses payable to the Collateral Agent for its services as Collateral
Agent in respect of the substitution, and the Company shall not be responsible
for any such fees or expenses.
Holders of Type B Units may reestablish Type A Units in integral
multiples of 20 Type B Units for 20 Type A Units.
Except as provided in this Section 3.14, for so long as the Purchase
Contract underlying a Type B Unit remains in effect, such Type B Unit shall not
be separable into its constituent parts and the rights and obligations of the
Holder of such Type B Unit in respect of the 1/20 of a Treasury Security and the
Purchase Contract comprising such Type B Unit may be acquired, and may be
transferred and exchanged, only as a Type B Unit.
Section 3.15. TRANSFER OF COLLATERAL UPON OCCURRENCE OF TERMINATION EVENT.
Upon the occurrence of a Termination Event and the transfer to the
Agent of the Debentures or the Treasury Securities, as the case may be,
underlying the Type A Units and the Type B Units pursuant to the terms of the
Pledge Agreement, the Agent shall request transfer instructions with respect to
such Debentures or Treasury Securities, as the case may be, from each Holder by
written request, substantially in the form of Exhibit D hereto, mailed to such
Holder at its address as it appears in the Type A Units Register or the Type B
Units Register, as the case may be. Upon book-entry transfer of the Type A Units
or Type B Units or delivery of a Type A Unit Certificate or Type B Unit
Certificate to the Agent with such transfer instructions, the Agent shall
transfer the Debentures or Treasury Securities, as the case may be, underlying
such Type A Units or Type B Units, as the case may be, to such Holder by
book-entry transfer, or other appropriate procedures, in accordance with such
instructions. In the event a Holder of Type A Units or Type B Units fails to
effect such transfer or delivery, the Debentures or Treasury Securities, as the
case may be, underlying such Type A Units or Type B Units, as the case may be,
and any interest thereon, shall be held in the name of the Agent or its nominee
in trust for the benefit of such Holder, until the earlier of (a) transfer of
such Type A Units or Type B Units or surrender of the Type A Unit Certificate or
Type B Unit Certificate or such Holder provides satisfactory evidence that such
Type A Unit Certificate or Type B Unit Certificate has been destroyed, lost or
stolen, together with any indemnity that may be required by the Agent and the
Company and (b) the expiration of the time period specified in the abandoned
property laws of the relevant State.
<PAGE>
Section 3.16. NO CONSENT TO ASSUMPTION.
Each Holder of a Security, by acceptance thereof, shall be deemed
expressly to have withheld any consent to the assumption under Section 365 of
the Bankruptcy Code or otherwise, of the Purchase Contract by the Company or its
trustee, receiver, liquidator or a person or entity performing similar functions
in the event that the Company becomes the debtor under the Bankruptcy Code or
subject to other similar state or federal law providing for reorganization or
liquidation.
ARTICLE IV
The Debentures
Section 4.1. PAYMENT OF INTEREST; RIGHTS TO INTEREST PRESERVED; INTEREST
RATE RESET.
Interest on any Debenture which is paid on any Payment Date shall,
subject to receipt thereof by the Agent from the Collateral Agent as provided by
the terms of the Pledge Agreement, be paid to the Person in whose name the Type
A Unit Certificate (or one or more Predecessor Type A Unit Certificates) of
which such Debenture is a part is registered at the close of business on the
Record Date for such Payment Date.
Each Type A Unit Certificate evidencing Debentures delivered under this
Agreement upon registration of transfer of or in exchange for or in lieu of any
other Type A Unit Certificate shall carry the rights to accrued and unpaid
interest, and to accrue interest, which were carried by the Debentures
underlying such other Type A Unit Certificate.
In the case of any Type A Unit with respect to which Cash Settlement of
the underlying Purchase Contract is effected on or prior to the fifth Business
Day immediately preceding the Purchase Contract Settlement Date pursuant to
prior notice, or with respect to which Early Settlement of the underlying
Purchase Contract is effected on an Early Settlement Date, or with respect to
which a Collateral Substitution is effected, in each case on a date that is
after any Record Date and on or prior to the next succeeding Payment Date,
interest on the Debentures underlying such Type A Units otherwise payable on
such Payment Date shall be payable on such Payment Date notwithstanding such
Cash Settlement or Early Settlement or Collateral Substitution, and such
interest shall, subject to receipt thereof by the Agent, be payable to the
Person in whose name the Type A Unit Certificate (or one or more Predecessor
Type A Unit Certificates) was registered at the close of business on the Record
Date. Except as otherwise expressly provided in the immediately preceding
sentence, in the case of any Type A Unit with respect to which Cash Settlement
or Early Settlement of the underlying Purchase Contract is effected on or prior
to the fifth Business Day immediately preceding the Purchase Contract Settlement
Date or an Early Settlement Date, as the case may be, or with respect to which a
Collateral Substitution has been effected, interest on the related Debentures
that would otherwise be payable after the Purchase Contract Settlement Date or
Early Settlement Date shall not be payable hereunder to the Holder of such Type
A Unit; PROVIDED, HOWEVER, that to the extent that such Holder continues to hold
the separated Debentures that formerly comprised a part of such
<PAGE>
Holder's Type A Unit, such Holder shall be entitled to receive the interest on
such separated Debentures pursuant to their terms.
The applicable interest rate borne by the Debentures on and after the
Purchase Contract Settlement Date shall be established pursuant to the
Remarketing on the third Business Day immediately preceding the Purchase
Contract Settlement Date to equal to the Reset Rate (such Reset Rate to be in
effect on and after the Purchase Contract Settlement Date).
Section 4.2. NOTICE AND VOTING.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Pledged
Debentures, as the case may be, but only to the extent instructed in writing by
the Holders as described below. Upon receipt of notice of any meeting at which
holders of Debentures are entitled to vote or upon any solicitation of consents,
waivers or proxies of holders of Debentures, the Agent shall, as soon as
practicable thereafter, mail to the Holders of Type A Units a notice (a)
containing such information as is contained in the notice or solicitation, (b)
stating that each Holder on the record date set by the Agent therefor (which, to
the extent possible, shall be the same date as the record date for determining
the holders of Debentures, as the case may be, entitled to vote) shall be
entitled to instruct the Agent as to the exercise of the voting rights
pertaining to such Debentures underlying their Type A Units and (c) stating the
manner in which such instructions may be given. Upon the written request of the
Holders of Type A Units on such record date received by the Agent at least six
days prior to such meeting, the Agent shall endeavor insofar as practicable to
vote or cause to be voted, in accordance with the instructions set forth in such
requests, the maximum principal amount of Debentures as to which any particular
voting instructions are received. In the absence of specific instructions from
the Holder of a Type A Unit, the Agent shall abstain from voting the Debentures
underlying such Type A Unit. The Company hereby agrees, if applicable, to
solicit Holders of Type A Units to timely instruct the Agent in order to enable
the Agent to vote such Debentures.
ARTICLE V
The Purchase Contracts
Section 5.1. PURCHASE OF SHARES OF COMMON STOCK.
Each Purchase Contract shall, unless an Early Settlement has occurred
in accordance with Section 5.9 hereof, obligate the Holder of the related
Security to purchase, and the Company to sell, on the Purchase Contract
Settlement Date at a price equal to the Stated Amount (the "Purchase Price"), a
number of newly issued shares of Common Stock equal to the Settlement Rate
unless, on or prior to the Purchase Contract Settlement Date, there shall have
occurred a Termination Event with respect to the Security of which such Purchase
Contract is a part. The "Settlement Rate" is equal to (a) if the Applicable
Market Value (as defined below) is equal to or greater than $[_______] (the
"Threshold Appreciation Price"), [_______] shares of Common Stock per Purchase
Contract, (b) if the Applicable Market Value is less than the Threshold
<PAGE>
Appreciation Price, but is greater than $[_______], the number of shares of
Common Stock equal to the Stated Amount divided by the Applicable Market Value
and (c) if the Applicable Market Value is less than or equal to $[_______],
[_______] shares of Common Stock per Purchase Contract, in each case subject to
adjustment as provided in Section 5.6 (and in each case rounded upward or
downward to the nearest 1/10,000th of a share). As provided in Section 5.10, no
fractional shares of Common Stock will be issued upon settlement of Purchase
Contracts.
The "Applicable Market Value" means the average of the Closing Price
per share of Common Stock on each of the 20 Trading Days ending on the third
Trading Day immediately preceding the Purchase Contract Settlement Date. The
"Closing Price" of the Common Stock on any date of determination means (i) the
closing sale price (or, if no closing price is reported, the last reported sale
price) of the Common Stock on the New York Stock Exchange (the "NYSE") on such
date, (ii) if the Common Stock is not listed for trading on the NYSE on any such
date, the closing sale price as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, (iii) if the Common Stock is not so listed on a United States national
or regional securities exchange, the closing sale price as reported by The
Nasdaq Stock Market, (iv) if the Common Stock is not so reported, the last
quoted bid price for the Common Stock in the over-the-counter market as reported
by the National Quotation Bureau or similar organization, or (v) if such bid
price is not available, the average of the mid-point of the last bid and ask
prices of the Common Stock on such date from at least three nationally
recognized independent investment banking firms retained for this purpose by the
Company. A "Trading Day" means a day on which the Common Stock (A) is not
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
Each Holder of a Type A Unit or a Type B Unit, by its acceptance
thereof, irrevocably authorizes the Agent to enter into and perform the related
Purchase Contract on its behalf as its attorney-in-fact (including the execution
of Certificates on behalf of such Holder), agrees to be bound by the terms and
provisions thereof, covenants and agrees to perform its obligations under such
Purchase Contracts, and consents to the provisions hereof, irrevocably
authorizes the Agent as its attorney-in-fact to enter into and perform this
Agreement and the Pledge Agreement on its behalf as its attorney-in-fact, and
consents to and agrees to be bound by the Pledge of the Debentures or the
Treasury Securities pursuant to the Pledge Agreement; PROVIDED that upon a
Termination Event, the rights of the Holder of such Security under the Purchase
Contract may be enforced without regard to any other rights or obligations. Each
Holder of a Type A Unit or a Type B Unit, by its acceptance thereof, further
covenants and agrees, that to the extent and in the manner provided in Section
5.4 and the Pledge Agreement, but subject to the terms thereof, Proceeds from
the remarketing of the Debentures or the Proceeds of the Treasury Securities on
the Purchase Contract Settlement Date shall be paid by the Collateral Agent to
the Company in satisfaction of such Holder's obligations under such Purchase
Contract and such Holder shall acquire no right, title or interest in such
payments.
Upon registration of transfer of a Certificate, the transferee shall be
bound (without the necessity of any other action on the part of such transferee)
by the terms of this Agreement, the
<PAGE>
Purchase Contracts underlying such Certificate and the Pledge Agreement and the
transferor shall be released from the obligations under this Agreement, the
Purchase Contracts underlying the Certificates so transferred and the Pledge
Agreement. The Company covenants and agrees, and each Holder of a Certificate,
by its acceptance thereof, likewise covenants and agrees, to be bound by the
provisions of this paragraph.
Section 5.2. CONTRACT ADJUSTMENT PAYMENTS.
The Company shall pay, on each Payment Date, the Contract Adjustment
Payments payable in respect of each Purchase Contract to the Person in whose
name a Certificate (or one or more Predecessor Certificates) is registered at
the close of business on the Record Date next preceding such Payment Date. The
Contract Adjustment Payments will be payable at the office of the Agent in The
City of New York maintained for that purpose or, at the option of the Company,
by check mailed to the address of the Person entitled thereto at such Person's
address as it appears on the Type A Units Register or Type B Units Register.
Upon the occurrence of a Termination Event, the Company's obligation to
pay Contract Adjustment Payments (including any accrued Contract Adjustment
Payments) shall cease.
Each Certificate delivered under this Agreement upon registration of
transfer of or in exchange for or in lieu of (including as a result of a
Collateral Substitution or the re-establishment of a Type A Unit) any other
Certificate shall carry the rights to Contract Adjustment Payments accrued and
unpaid, and to accrue Contract Adjustment Payments, which were carried by the
Purchase Contracts underlying such other Certificates.
Subject to Section 5.9, in the case of any Security with respect to
which Early Settlement of the underlying Purchase Contract is effected on an
Early Settlement Date that is after any Record Date and on or prior to the next
succeeding Payment Date, Contract Adjustment Payments, if any, otherwise payable
on such Payment Date shall be payable on such Payment Date notwithstanding such
Early Settlement, and such Contract Adjustment Payments shall be paid to the
Person in whose name the Certificate evidencing such Security (or one or more
Predecessor Certificates) is registered at the close of business on such Record
Date. Except as otherwise expressly provided in the immediately preceding
sentence, in the case of any Security with respect to which Early Settlement of
the underlying Purchase Contract is effected on an Early Settlement Date,
Contract Adjustment Payments that would otherwise be payable after the Early
Settlement Date with respect to such Purchase Contract shall not be payable.
Section 5.3. [INTENTIONALLY OMITTED].
Section 5.4. PAYMENT OF PURCHASE PRICE.
(a) (i) Unless a Holder settles the underlying Purchase Contract
through the early delivery of cash to the Purchase Contract Agent in the manner
described in Section 5.9, each Holder of a Type A Unit who intends to pay in
cash to satisfy such Holder's obligation under the Purchase Contract shall
notify the Agent by use of a notice in substantially the form of Exhibit E
hereto of its intention to pay in cash ("Cash Settlement") the Purchase Price
for the shares of Common
<PAGE>
Stock to be purchased pursuant to a Purchase Contract. Such notice shall be
given prior to 5:00 p.m., New York City time, on the seventh Business Day
immediately preceding the Purchase Contract Settlement Date. Prior to 11:00
a.m., New York City time, on the next succeeding Business Day, the Agent shall
notify the Collateral Agent and the Indenture Trustee of the receipt of such
notices from Holders intending to make a Cash Settlement.
(ii) A Holder of a Type A Unit who has so notified the Agent of
its intention to make a Cash Settlement shall pay the Purchase Price to the
Securities Intermediary for deposit in the Collateral Account prior to 11:00
a.m., New York City time, on the fifth Business Day immediately preceding the
Purchase Contract Settlement Date in lawful money of the United States by
certified or cashiers' check or wire transfer, in each case in immediately
available funds payable to or upon the order of the Securities Intermediary. Any
cash received by the Collateral Agent shall be invested promptly by the
Securities Intermediary in Permitted Investments and paid to the Company on the
Purchase Contract Settlement Date in settlement of the Purchase Contract in
accordance with the terms of this Agreement and the Pledge Agreement. Any funds
received by the Securities Intermediary in respect of the investment earnings
from the investment in such Permitted Investments, shall be distributed to the
Agent when received for payment to the Holder of the related Type A Units on the
Purchase Contract Settlement Date.
(iii) If a Holder of a Type A Unit fails to notify the Agent of
its intention to make a Cash Settlement in accordance with paragraph (a)(i)
above, or does notify the Agent as provided in paragraph (a)(i) above of its
intention to pay the Purchase Price in cash, but fails to make such payment as
required by paragraph (a)(ii) above, such Holder shall be deemed to have
consented to the disposition of the Pledged Debentures pursuant to the
remarketing as described in paragraph (b) below.
(iv) Not later than 15 calendar days nor more than 30 calendar
days prior to the third Business Day immediately preceding the Purchase Contract
Settlement Date, the Company shall request DTC (or any successor Clearing
Agency), to notify the Beneficial Owners or Clearing Agency Participants holding
Type A Units or Type B Units of the procedures to be followed by Holders of Type
A Units who intend to effect the settlement of their obligations under the
Purchase Contracts underlying such Type A Units with separate cash on or prior
to the fifth Business Day prior to the Purchase Contract Settlement Date.
(v) Promptly after 11:00 a.m., New York City time, on the fifth
Business Day preceding the Purchase Contract Settlement Date, the Agent, based
on notices received by the Agent pursuant to Section 5.4(a)(i) hereof and notice
from the Securities Intermediary regarding cash received by it prior to such
time, shall notify the Collateral Agent and the Indenture Trustee of the
principal amount of Debentures to be tendered for purchase in the Remarketing in
a notice substantially in the form of Exhibit F hereto.
(b) In order to dispose of the Debentures, Type A Unit Holders who have
not notified the Agent of their intention to effect a Cash Settlement as
provided in paragraph (a)(i) above, or who have so notified the Agent but fail
to make such payment as required by paragraph (a)(ii) above, the Company shall
engage _____________ (the "Remarketing Agent") pursuant to the Remarketing
Agreement to sell such Debentures. In order to facilitate the remarketing, the
<PAGE>
Agent, based on the notices specified in Section 5.4(a)(v), shall notify the
Remarketing Agent, promptly after 11:00 a.m., New York City time, on the fifth
Business Day immediately preceding the Purchase Contract Settlement Date, of the
aggregate principal amount of Debentures that are a component of Type A Units to
be remarketed. Concurrently, the Collateral Agent, pursuant to the terms of the
Pledge Agreement, shall cause such Debentures to be presented to the Remarketing
Agent for remarketing. Upon receipt of such notice from the Agent and such
Debentures, the Remarketing Agent shall, on the third Business Day immediately
preceding the Purchase Contract Settlement Date, use commercially reasonable
efforts to remarket such Debentures on such date at a price of 100.25% of the
aggregate principal amount at maturity of such Debentures. The proceeds equal to
100% of the aggregate principal amount at maturity of the remarketed Debentures
shall automatically be applied by the Collateral Agent, in accordance with the
Pledge Agreement, to satisfy in full such Type A Unit Holders' obligations to
pay the Purchase Price for the Common Stock under the related Purchase Contracts
on the Purchase Contract Settlement Date. The proceeds equal to .25% of the
aggregate principal amount at maturity of the remarketed Debentures shall
automatically be applied, in accordance with the Pledge Agreement, to pay the
remarketing fee of the Remarketing Agent. Type A Unit Holders whose Debentures
are so remarketed shall not be responsible for the payment of any remarketing
fee in connection therewith. If, in spite of using their reasonable efforts, the
Remarketing Agent cannot remarket the related Debentures of such Holders of Type
A Units at a price of 100.25% of the aggregate principal amount at maturity of
such Debentures, the remarketing shall be deemed to have failed (a "Failed
Remarketing") and in accordance with the terms of the Pledge Agreement the
Collateral Agent, for the benefit of the Company, shall be entitled to exercise
its rights as a secured party with respect to such Debentures, including those
actions specified in paragraph (c) below; provided, that if upon a Failed
Remarketing the Collateral Agent exercises such rights for the benefit of the
Company with respect to such Debentures, any accrued and unpaid interest on such
Debentures shall become payable by the Company to the Agent for payment to the
Beneficial Owner of the Type A Units to which such Debentures relate. The
Company shall cause a notice of such Failed Remarketing to be published no later
than the Business Day immediately preceding the Purchase Contract Settlement
Date in a daily newspaper in the English language of general circulation in The
City of New York, which is expected to be THE WALL STREET JOURNAL.
(c) With respect to any Debentures which are subject to a Failed
Remarketing, the Collateral Agent for the benefit of the Company reserves all of
its rights as a secured party with respect thereto and, subject to applicable
law and paragraph (g) below, may, among other things, (i) retain the Debentures
in full satisfaction of the Holders' obligations under the Purchase Contracts or
(ii) sell the Debentures in one or more public or private sales.
(d) (i) Unless a Holder of Type B Units settles the underlying Purchase
Contract through the early delivery of cash to the Purchase Contract Agent in
the manner described in Section 5.9, each Holder of a Type B Unit who intends to
pay in cash shall notify the Agent by use of a notice in substantially the form
of Exhibit E hereto of its intention to pay in cash the Purchase Price for the
shares of Common Stock to be purchased pursuant to a Purchase Contract. Such
notice shall be given on or prior to 5:00 p.m., New York City time, on the
second Business Day immediately preceding the Purchase Contract Settlement Date.
<PAGE>
(ii) A Holder of a Type B Unit who has so notified the Agent of
its intention to make a Cash Settlement in accordance with paragraph (d)(i)
above shall pay the Purchase Price to the Securities Intermediary for deposit in
the Collateral Account prior to 11:00 a.m., New York City time, on the Business
Day immediately preceding the Purchase Contract Settlement Date in lawful money
of the United States by certified or cashiers' check or wire transfer, in each
case in immediately available funds payable to or upon the order of the
Securities Intermediary. Any cash received by the Collateral Agent shall be
invested promptly by the Securities Intermediary in Permitted Investments and
paid to the Company on the Purchase Contract Settlement Date in settlement of
the Purchase Contract in accordance with the terms of this Agreement and the
Pledge Agreement. Any funds received by the Securities Intermediary in respect
of the investment earnings from the investment in such Permitted Investments
shall be distributed to the Agent when received for payment to the Holder.
(iii) If a Holder of a Type B Unit fails to notify the Agent of
its intention to make a Cash Settlement in accordance with paragraph (d)(i)
above, or does notify the Agent as provided in paragraph (d)(i) above of its
intention to pay the Purchase Price in cash, but fails to make such payment as
required by paragraph (d)(ii) above, then upon the maturity of the Pledged
Treasury Securities held by the Securities Intermediary on the Business Day
immediately prior to the Purchase Contract Settlement Date, the principal amount
of the Treasury Securities received by the Securities Intermediary shall be
invested promptly in Permitted Investments. On the Purchase Contract Settlement
Date an amount equal to the Purchase Price shall be remitted to the Company as
payment thereof without receiving any instructions from the Holder. In the event
the sum of the proceeds from the related Pledged Treasury Securities and the
investment earnings earned from such investments is in excess of the aggregate
Purchase Price of the Purchase Contracts being settled thereby, the Collateral
Agent shall cause the Securities Intermediary to distribute such excess to the
Agent for the benefit of the Holder of the related Type B Unit when received.
(e) Any distribution to Holders of excess funds and interest described
above shall be payable at the office of the Agent in The City of New York
maintained for that purpose or, at the option of the Holder, by check mailed to
the address of the Person entitled thereto at such address as it appears on the
Register.
(f) Upon Cash Settlement of any Purchase Contract, (i) the Collateral
Agent will in accordance with the terms of the Pledge Agreement cause the
Pledged Debentures or the Pledged Treasury Securities, as the case may be,
underlying the relevant Security to be released from the Pledge free and clear
of any security interest of the Company and transferred to the Agent for
delivery to the Holder thereof or its designee as soon as practicable and (ii)
subject to the receipt thereof, the Agent shall, by book-entry transfer, or
other appropriate procedures, in accordance with written instructions provided
by the Holder thereof, transfer such Debentures or such Treasury Securities, as
the case may be (or, if no such instructions are given to the Agent by the
Holder, the Agent shall hold such Debentures or such Treasury Securities, as the
case may be, and any interest thereon, in the name of the Agent or its nominee
in trust for the benefit of such Holder until the expiration of the time period
specified in the abandoned property laws of the relevant State).
<PAGE>
(g) The obligations of the Holders to pay the Purchase Price are
non-recourse obligations and, except to the extent paid by Early Settlement or
Cash Settlement, are payable solely out of the proceeds of any Collateral
pledged to secure the obligations of the Holders and in no event will Holders be
liable for any deficiency between the proceeds of the disposition of Collateral
and the Purchase Price.
Section 5.5. ISSUANCE OF SHARES OF COMMON STOCK.
Unless a Termination Event or an Early Settlement shall have occurred,
subject to Section 5.6(b), the Company shall issue and deposit with the Agent,
for the benefit of the Holders of the Outstanding Securities, one or more
certificates representing the newly issued shares of Common Stock registered in
the name of the Agent (or its nominee) as custodian for the Holders (such
certificates for shares of Common Stock, together with any dividends or
distributions for which a record date and payment date for such dividend or
distribution has occurred after the Purchase Contract Settlement Date, being
hereinafter referred to as the "Purchase Contract Settlement Fund") to which the
Holders are entitled hereunder. Subject to the foregoing, upon surrender of a
Certificate to the Agent on or after the Purchase Contract Settlement Date,
together with settlement instructions thereon duly completed and executed, the
Holder of such Certificate shall be entitled to receive in exchange therefor a
certificate representing that number of whole shares of Common Stock which such
Holder is entitled to receive pursuant to the provisions of this Article Five
(after taking into account all Securities then held by such Holder), together
with cash in lieu of fractional shares as provided in Section 5.10 and any
dividends or distributions with respect to such shares constituting part of the
Purchase Contract Settlement Fund, but without any interest thereon, and the
Certificate so surrendered shall forthwith be cancelled. Such shares shall be
registered in the name of the Holder or the Holder's designee as specified in
the settlement instructions provided by the Holder to the Agent. If any shares
of Common Stock issued in respect of a Purchase Contract are to be registered to
a Person other than the Person in whose name the Certificate evidencing such
Purchase Contract is registered, no such registration shall be made unless the
Person requesting such registration has paid any transfer and other taxes
required by reason of such registration in a name other than that of the
registered Holder of the Certificate evidencing such Purchase Contract or has
established to the satisfaction of the Company that such tax either has been
paid or is not payable.
Section 5.6. ADJUSTMENT OF SETTLEMENT RATE.
(a) Adjustments for Dividends, Distributions, Stock Splits, Etc.
(1) In case the Company shall pay or make a dividend or other
distribution on the Common Stock in Common Stock, the Settlement Rate in effect
at the opening of business on the day following the date fixed for the
determination of stockholders entitled to receive such dividend or other
distribution shall be increased by dividing such Settlement Rate by a fraction
of which the numerator shall be the number of shares of Common Stock outstanding
at the close of business on the date fixed for such determination and the
denominator shall be the sum of such number of shares and the total number of
shares constituting such dividend or other distribution, such increase to become
effective immediately after the opening of business on the day following the
date fixed for such determination. For the purposes of this paragraph (1), the
number of
<PAGE>
shares of Common Stock at any time outstanding shall not include shares held in
the treasury of the Company but shall include any shares issuable in respect of
any scrip certificates issued in lieu of fractions of shares of Common Stock.
The Company will not pay any dividend or make any distribution on shares of
Common Stock held in the treasury of the Company.
(2) In case the Company shall issue rights, options or
warrants to all holders of its Common Stock (not being available on an
equivalent basis to Holders of the Securities upon settlement of the Purchase
Contracts underlying such Securities) entitling them, for a period expiring
within 45 days after the record date for the determination of stockholders
entitled to receive such rights, options or warrants, to subscribe for or
purchase shares of Common Stock at a price per share less than the Current
Market Price per share of the Common Stock on the date fixed for the
determination of stockholders entitled to receive such rights, options or
warrants (other than pursuant to a dividend reinvestment plan), the Settlement
Rate in effect at the opening of business on the day following the date fixed
for such determination shall be increased by dividing such Settlement Rate by a
fraction of which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination
plus the number of shares of Common Stock which the aggregate of the offering
price of the total number of shares of Common Stock so offered for subscription
or purchase would purchase at such Current Market Price and the denominator
shall be the number of shares of Common Stock outstanding at the close of
business on the date fixed for such determination plus the number of shares of
Common Stock so offered for subscription or purchase, such increase to become
effective immediately after the opening of business on the day following the
date fixed for such determination. For the purposes of this paragraph (2), the
number of shares of Common Stock at any time outstanding shall not include
shares held in the treasury of the Company but shall include any shares issuable
in respect of any scrip certificates issued in lieu of fractions of shares of
Common Stock. The Company shall not issue any such rights, options or warrants
in respect of shares of Common Stock held in the treasury of the Company.
(3) In case outstanding shares of Common Stock shall be
subdivided or split into a greater number of shares of Common Stock, the
Settlement Rate in effect at the opening of business on the day following the
day upon which such subdivision or split becomes effective shall be
proportionately increased, and, conversely, in case outstanding shares of Common
Stock shall each be combined into a smaller number of shares of Common Stock,
the Settlement Rate in effect at the opening of business on the day following
the day upon which such combination becomes effective shall be proportionately
reduced, such increase or reduction, as the case may be, to become effective
immediately after the opening of business on the day following the day upon
which such subdivision, split or combination becomes effective.
(4) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock evidences of its indebtedness or
assets (including securities, but excluding any rights or warrants referred to
in paragraph (2) of this Section, any dividend or distribution paid exclusively
in cash and any dividend or distribution referred to in paragraph (1) of this
Section), the Settlement Rate shall be adjusted so that the same shall equal the
rate determined by dividing the Settlement Rate in effect immediately prior to
the close of business on the date fixed for the determination of stockholders
entitled to receive such distribution by a fraction of which the numerator shall
be the Current Market Price per share of the Common
<PAGE>
Stock on the date fixed for such determination less the then fair market value
(as determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) of the portion of the assets or
evidences of indebtedness so distributed applicable to one share of Common Stock
and the denominator shall be such Current Market Price per share of the Common
Stock, such adjustment to become effective immediately prior to the opening of
business on the day following the date fixed for the determination of
stockholders entitled to receive such distribution. In any case in which this
paragraph (4) is applicable, paragraph (2) of this Section shall not be
applicable.
(5) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock (I) cash (excluding any cash that
is distributed in a Reorganization Event to which Section 5.6(b) applies or as
part of a distribution referred to in paragraph (4) of this Section) in an
aggregate amount that, combined together with the aggregate amount of any other
distributions to all holders of its Common Stock made exclusively in cash (other
than in connection with a Reorganization Event) within the 12 months preceding
the date of payment of such distribution and in respect of which no adjustment
pursuant to this paragraph (5) or paragraph (6) of this Section has been made
and (II) the aggregate of any cash plus the fair market value (as determined by
the Board of Directors, whose determination shall be conclusive and described in
a Board Resolution) of consideration payable in respect of any tender or
exchange offer by the Company or any of its subsidiaries for all or any portion
of the Common Stock concluded within the 12 months preceding the date of payment
of the distribution described in Clause (I) above and in respect of which no
adjustment pursuant to this paragraph (5) or paragraph (4) or paragraph (6) of
this Section has been made, exceeds 15% of the product of the Current Market
Price per share of the Common Stock on the date for the determination of holders
of shares of Common Stock entitled to receive such distribution times the number
of shares of Common Stock outstanding on such date, then, and in each such case,
immediately after the close of business on such date for determination, the
Settlement Rate shall be increased so that the same shall equal the rate
determined by dividing the Settlement Rate in effect immediately prior to the
close of business on the date fixed for determination of the stockholders
entitled to receive such distribution by a fraction (i) the numerator of which
shall be equal to the Current Market Price per share of the Common Stock on the
date fixed for such determination less an amount equal to the quotient of (x)
the combined amount distributed or payable in the transactions described in
clauses (I) and (II) above divided by (y) the number of shares of Common Stock
outstanding on such date for determination and (ii) the denominator of which
shall be equal to the Current Market Price per share of the Common Stock on such
date for determination.
(6) In case a tender or exchange offer made by the Company or
any subsidiary of the Company for all or any portion of the Common Stock shall
expire and such tender or exchange offer (as amended upon the expiration
thereof) shall require the payment to stockholders (based on the acceptance (up
to any maximum specified in the terms of the tender or exchange offer) of
Purchased Shares) of (I) an aggregate consideration having a fair market value
(as determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution) that combined together with the
aggregate of the cash plus the fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a Board
Resolution), as of the expiration of such tender or exchange
<PAGE>
offer, of consideration payable in respect of any other tender or exchange
offer, by the Company or any subsidiary of the Company for all or any portion of
the Common Stock expiring within the 12 months preceding the expiration of such
tender or exchange offer and in respect of which no adjustment pursuant to
paragraph (5) of this Section or this paragraph (6) has been made and (II) the
aggregate amount of any distributions to all holders of the Company's Common
Stock made exclusively in cash within the 12 months preceding the expiration of
such tender or exchange offer and in respect of which no adjustment pursuant to
paragraph (5) of this Section or this paragraph (6) has been made, exceeds 15%
of the product of the Current Market Price per share of the Common Stock as of
the last time (the "Expiration Time") tenders could have been made pursuant to
such tender or exchange offer (as it may be amended) times the number of shares
of Common Stock outstanding (including any tendered shares) on the Expiration
Time, then, and in each such case, immediately prior to the opening of business
on the day after the date of the Expiration Time, the Settlement Rate shall be
adjusted so that the same shall equal the rate determined by dividing the
Settlement Rate immediately prior to the close of business on the date of the
Expiration Time by a fraction (i) the numerator of which shall be equal to (A)
the product of (1) the Current Market Price per share of the Common Stock on the
date of the Expiration Time and (2) the number of shares of Common Stock
outstanding (including any tendered shares) on the Expiration Time less (B) the
amount of cash plus the fair market value (determined as aforesaid) of the
aggregate consideration payable to stockholders based on the transactions
described in clauses (I) and (II) above (assuming in the case of clause (I) the
acceptance, up to any maximum specified in the terms of the tender or exchange
offer, of Purchased Shares), and (ii) the denominator of which shall be equal to
the product of (A) the Current Market Price per share of the Common Stock as of
the Expiration Time and (B) the number of shares of Common Stock outstanding
(including any tendered shares) as of the Expiration Time less the number of all
shares validly tendered and not withdrawn as of the Expiration Time (the shares
deemed so accepted, up to any such maximum, being referred to as the "Purchased
Shares").
(7) The reclassification of Common Stock into securities
including securities other than Common Stock (other than any reclassification
upon a Reorganization Event to which Section 5.6(b) applies) shall be deemed to
involve (a) a distribution of such securities other than Common Stock to all
holders of Common Stock (and the effective date of such reclassification shall
be deemed to be "the date fixed for the determination of stockholders entitled
to receive such distribution" and the "date fixed for such determination" within
the meaning of paragraph (4) of this Section), and (b) a subdivision, split or
combination, as the case may be, of the number of shares of Common Stock
outstanding immediately prior to such reclassification into the number of shares
of Common Stock outstanding immediately thereafter (and the effective date of
such reclassification shall be deemed to be "the day upon which such subdivision
or split becomes effective" or "the day upon which such combination becomes
effective", as the case may be, and "the day upon which such subdivision, split
or combination becomes effective" within the meaning of paragraph (3) of this
Section).
(8) The "Current Market Price" per share of Common Stock on
any day means the average of the daily Closing Prices for the five consecutive
Trading Days selected by the Company commencing not more than 30 Trading Days
before, and ending not later than, the earlier of the day in question and the
day before the "ex date" with respect to the issuance or
<PAGE>
distribution requiring such computation. For purposes of this paragraph, the
term "ex date", when used with respect to any issuance or distribution, shall
mean the first date on which the Common Stock trades regular way on such
exchange or in such market without the right to receive such issuance or
distribution.
(9) All adjustments to the Settlement Rate shall be calculated
to the nearest 1/10,000th of a share of Common Stock (or if there is not a
nearest 1/10,000th of a share, to the next lower 1/10,000th of a share). No
adjustment in the Settlement Rate shall be required unless such adjustment would
require an increase or decrease of at least one percent thereof; provided,
however, that any adjustments which by reason of this subparagraph are not
required to be made shall be carried forward and taken into account in any
subsequent adjustment. If an adjustment is made to the Settlement Rate pursuant
to paragraph (1), (2), (3), (4), (5), (6), (7) or (10) of this Section 5.6(a),
an adjustment shall also be made to the Applicable Market Value solely to
determine which of clauses (a), (b) or (c) of the definition of Settlement Rate
in Section 5.1 will apply on the Purchase Contract Settlement Date. Such
adjustment shall be made by multiplying the Applicable Market Value by a
fraction of which the numerator shall be the Settlement Rate immediately after
such adjustment pursuant to paragraph (1), (2), (3), (4), (5), (6), (7) or (10)
of this Section 5.6(a) and the denominator shall be the Settlement Rate
immediately before such adjustment; provided, however, that if such adjustment
to the Settlement Rate is required to be made pursuant to the occurrence of any
of the events contemplated by paragraph (1), (2), (3), (4), (5), (7) or (10) of
this Section 5.6(a) during the period taken into consideration for determining
the Applicable Market Value, appropriate and customary adjustments shall be made
to the Settlement Rate.
(10) The Company may make such increases in the Settlement
Rate, in addition to those required by this Section, as it considers to be
advisable in order to avoid or diminish any income tax to any holders of shares
of Common Stock resulting from any dividend or distribution of stock or issuance
of rights or warrants to purchase or subscribe for stock or from any event
treated as such for income tax purposes or for any other reason.
(b) Adjustment for Consolidation, Merger or Other Reorganization
Event.
In the event of (i) any consolidation or merger of the Company
with or into another Person (other than a merger or consolidation in which the
Company is the continuing corporation and in which the Common Stock outstanding
immediately prior to the merger or consolidation is not exchanged for cash,
securities or other property of the Company or another corporation), (ii) any
sale, transfer, lease or conveyance to another Person of the property of the
Company as an entirety or substantially as an entirety, (iii) any statutory
exchange of securities of the Company with another Person (other than in
connection with a merger or acquisition) or (iv) any liquidation, dissolution or
winding up of the Company other than as a result of or after the occurrence of a
Termination Event (any such event, a "Reorganization Event"), the Settlement
Rate will be adjusted to provide that each Holder of Securities will receive on
the Purchase Contract Settlement Date with respect to each Purchase Contract
forming a part thereof, the kind and amount of securities, cash and other
property receivable upon such Reorganization Event (without any interest
thereon, and without any right to dividends or distribution thereon which have a
record date that is prior to the Purchase Contract Settlement Date) by a Holder
of
<PAGE>
the number of shares of Common Stock issuable on account of each Purchase
Contract if the Purchase Contract Settlement Date had occurred immediately prior
to such Reorganization Event assuming such Holder of Common Stock is not a
Person with which the Company consolidated or into which the Company merged or
which merged into the Company or to which such sale or transfer was made, as the
case may be (any such Person, a "Constituent Person"), or an Affiliate of a
Constituent Person to the extent such Reorganization Event provides for
different treatment of Common Stock held by Affiliates of the Company and
non-affiliates and such Holder failed to exercise his rights of election, if
any, as to the kind or amount of securities, cash and other property receivable
upon such Reorganization Event (provided that if the kind or amount of
securities, cash and other property receivable upon such Reorganization Event is
not the same for each share of Common Stock held immediately prior to such
Reorganization Event by other than a Constituent Person or an Affiliate thereof
and in respect of which such rights of election shall not have been exercised
("non-electing share"), then for the purpose of this Section the kind and amount
of securities, cash and other property receivable upon such Reorganization Event
by each non-electing share shall be deemed to be the kind and amount so
receivable per share by a plurality of the non-electing shares). In the event of
such a Reorganization Event, the Person formed by such consolidation, merger or
exchange or the Person which acquires the assets of the Company or, in the event
of a liquidation or dissolution of the Company, the Company or a liquidating
trust created in connection therewith, shall execute and deliver to the Agent an
agreement supplemental hereto providing that the Holders of each Outstanding
Security shall have the rights provided by this Section 5.6(b). Such
supplemental agreement shall provide for adjustments which, for events
subsequent to the effective date of such supplemental agreement, shall be as
nearly equivalent as may be practicable to the adjustments provided for in this
Section. The above provisions of this Section shall similarly apply to
successive Reorganization Events.
Section 5.7. NOTICE OF ADJUSTMENTS AND CERTAIN OTHER EVENTS.
(a) Whenever the Settlement Rate is adjusted as herein provided,
the Company shall:
(i) forthwith compute the adjusted Settlement Rate in
accordance with Section 5.6 and prepare and transmit to the Agent an
Officers' Certificate setting forth the Settlement Rate, the method of
calculation thereof in reasonable detail, and the facts requiring such
adjustment and upon which such adjustment is based; and
(ii) within 10 Business Days following the occurrence of
an event that requires an adjustment to the Settlement Rate pursuant to
Section 5.6 (or if the Company is not aware of such occurrence, as soon
as practicable after becoming so aware), provide a written notice to
the Holders of the Securities of the occurrence of such event and a
statement in reasonable detail setting forth the method by which the
adjustment to the Settlement Rate was determined and setting forth the
adjusted Settlement Rate.
(b) The Agent shall not at any time be under any duty or responsibility
to any Holder of Securities to determine whether any facts exist which may
require any adjustment of the Settlement Rate, or with respect to the nature or
extent or calculation of any such adjustment when made, or with respect to the
method employed in making the same. The Agent shall not be
<PAGE>
accountable with respect to the validity or value (or the kind or amount) of any
shares of Common Stock, or of any securities or property, which may at the time
be issued or delivered with respect to any Purchase Contract; and the Agent
makes no representation with respect thereto. The Agent shall not be responsible
for any failure of the Company to issue, transfer or deliver any shares of
Common Stock pursuant to a Purchase Contract or to comply with any of the
duties, responsibilities or covenants of the Company contained in this Article.
Section 5.8. TERMINATION EVENT; NOTICE.
The Purchase Contracts and all obligations and rights of the Company
and the Holders thereunder, including, without limitation, the rights of the
Holders to receive and the obligation of the Company to pay any Contract
Adjustment Payments, if the Company shall have such obligation, and the rights
and obligations of Holders to purchase Common Stock, shall immediately and
automatically terminate, without the necessity of any notice or action by any
Holder, the Agent or the Company, if, on or prior to the Purchase Contract
Settlement Date, a Termination Event shall have occurred. Upon and after the
occurrence of a Termination Event, the Securities shall thereafter represent the
right to receive the Debentures forming a part of such Securities in the case of
Type A Units, or Treasury Securities in the case of Type B Units, in accordance
with the provisions of Section 5.4 of the Pledge Agreement. Upon the occurrence
of a Termination Event, the Company shall promptly but in no event later than
two Business Days thereafter give written notice to the Agent, the Collateral
Agent and the Holders, at their addresses as they appear in the Register.
Section 5.9. EARLY SETTLEMENT.
(a) Subject to and upon compliance with the provisions of this Section
5.9, at the option of the Holder thereof, Purchase Contracts underlying
Securities may be settled early ("Early Settlement") in the case of Type A Units
on or prior to the seventh Business Day immediately preceding the Purchase
Contract Settlement Date and in the case of Type B Units on or prior to the
second Business Day immediately preceding the Purchase Contract Settlement Date,
in each case, as provided herein. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contracts, the Holder of the Certificate
evidencing Securities shall deliver such Certificate to the Agent at the
Corporate Trust Office duly endorsed for transfer to the Company or in blank
with the form of Election to Settle Early on the reverse thereof duly completed
and accompanied by payment (payable to the Company in immediately available
funds) in an amount (the "Early Settlement Amount") equal to (i) the product of
(A) the Stated Amount times (B) the number of Purchase Contracts with respect to
which the Holder has elected to effect Early Settlement plus (ii) if such
delivery is made with respect to any Purchase Contracts during the period from
the close of business on any Record Date next preceding any Payment Date to the
opening of business on such Payment Date, an amount equal to the sum of (x) the
Contract Adjustment Payments payable on such Payment Date with respect to such
Purchase Contracts plus (y) in the case of a Type A Unit Certificate, the
distributions on the related Debentures payable on such Payment Date. Except as
provided in the immediately preceding sentence and subject to the last paragraph
of Section 5.2, no payment or adjustment shall be made upon Early Settlement of
any Purchase Contract on account of any Contract Adjustment Payments accrued on
such Purchase Contract or on account of any dividends on the
<PAGE>
Common Stock issued upon such Early Settlement. If the foregoing requirements
are first satisfied with respect to Purchase Contracts underlying any Securities
at or prior to 5:00 p.m., New York City time, on a Business Day, such day shall
be the "Early Settlement Date" with respect to such Securities and if such
requirements are first satisfied after 5:00 p.m., New York City time, on a
Business Day or on a day that is not a Business Day, the "Early Settlement Date"
with respect to such Securities shall be the next succeeding Business Day.
(b) Upon Early Settlement of Purchase Contracts by a Holder of the
related Securities, the Company shall issue, and the Holder shall be entitled to
receive, [________] shares of Common Stock on account of each Purchase Contract
as to which Early Settlement is effected (the "Early Settlement Rate"). The
Early Settlement Rate shall be adjusted in the same manner and at the same time
as the Settlement Rate is adjusted.
(c) No later than the third Business Day after the applicable Early
Settlement Date, the Company shall cause (i) the shares of Common Stock issuable
upon Early Settlement of Purchase Contracts to be issued and delivered, together
with payment in lieu of any fraction of a share, as provided in Section 5.10,
and (ii) the related Debentures, in the case of Type A Units, or the related
Treasury Securities, in the case of Type B Units, to be released from the Pledge
by the Collateral Agent and transferred, in each case, to the Agent for delivery
to the Holder thereof or its designee.
(d) Upon Early Settlement of any Purchase Contracts, and subject to
receipt of shares of Common Stock from the Company and the Debentures or
Treasury Securities, as the case may be, from the Securities Intermediary, as
applicable, the Agent shall, in accordance with the instructions provided by the
Holder thereof on the applicable form of Election to Settle Early on the reverse
of the Certificate evidencing the related Securities, (i) transfer to the Holder
the Debentures or Treasury Securities, as the case may be, forming a part of
such Securities, and (ii) deliver to the Holder a certificate or certificates
for the full number of shares of Common Stock issuable upon such Early
Settlement, together with payment in lieu of any fraction of a share, as
provided in Section 5.10.
(e) In the event that Early Settlement is effected with respect to
Purchase Contracts underlying less than all the Securities evidenced by a
Certificate, upon such Early Settlement the Company shall execute and the Agent
shall authenticate, countersign and deliver to the Holder thereof, at the
expense of the Company, a Certificate evidencing the Securities as to which
Early Settlement was not effected.
Section 5.10. NO FRACTIONAL SHARES.
No fractional shares or scrip representing fractional shares of Common
Stock shall be issued or delivered upon settlement on the Purchase Contract
Settlement Date or upon Early Settlement of any Purchase Contracts. If
Certificates evidencing more than one Purchase Contract shall be surrendered for
settlement at one time by the same Holder, the number of full shares of Common
Stock which shall be delivered upon settlement shall be computed on the basis of
the aggregate number of Purchase Contracts evidenced by the Certificates so
surrendered. Instead of any fractional share of Common Stock which would
otherwise be
<PAGE>
deliverable upon settlement of any Purchase Contracts on the Purchase Contract
Settlement Date or upon Early Settlement, the Company, through the Agent, shall
make a cash payment in respect of such fractional interest in an amount equal to
the value of such fractional shares times the Applicable Market Value. The
Company shall provide the Agent from time to time with sufficient funds to
permit the Agent to make all cash payments required by this Section 5.10 in a
timely manner.
Section 5.11. CHARGES AND TAXES.
The Company will pay all stock transfer and similar taxes attributable
to the initial issuance and delivery of the shares of Common Stock pursuant to
the Purchase Contracts; provided, however, that the Company shall not be
required to pay any such tax or taxes which may be payable in respect of any
exchange of or substitution for a Certificate evidencing a Security or any
issuance of a share of Common Stock in a name other than that of the registered
Holder of a Certificate surrendered in respect of the Securities evidenced
thereby, other than in the name of the Agent, as custodian for such Holder, and
the Company shall not be required to issue or deliver such share certificates or
Certificates unless or until the Person or Persons requesting the transfer or
issuance thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.
ARTICLE VI
Remedies
Section 6.1. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE CONTRACT ADJUSTMENT
PAYMENTS AND TO PURCHASE COMMON STOCK.
In the event that Contract Adjustment Payments shall constitute a
component of Type A Units or Type B Units, the Holder of any Type A Unit or Type
B Unit shall have the right, which is absolute and unconditional (subject to the
payment by a holder of Contract Adjustment Payments pursuant to Section 5.9(a)),
to receive payment of each installment of the Contract Adjustment Payments with
respect to the Purchase Contract constituting a part of such Security on the
respective Payment Date for such Security and to purchase Common Stock pursuant
to such Purchase Contract and, in each such case, to institute suit for the
enforcement of any such payment and right to purchase Common Stock, and such
rights shall not be impaired without the consent of such Holder.
Section 6.2. RESTORATION OF RIGHTS AND REMEDIES.
If any Holder has instituted any proceeding to enforce any right or
remedy under this Agreement and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company and such Holder shall be restored severally and respectively to their
former positions hereunder and thereafter all rights and remedies of such Holder
shall continue as though no such proceeding had been instituted.
<PAGE>
Section 6.3. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Certificates in the last paragraph of
Section 3.10, no right or remedy herein conferred upon or reserved to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
Section 6.4. DELAY OR OMISSION NOT WAIVER.
No delay or omission of any Holder to exercise any right or remedy upon
a default shall impair any such right or remedy or constitute a waiver of any
such right. Every right and remedy given by this Article or by law to the
Holders may be exercised from time to time, and as often as may be deemed
expedient, by such Holders.
Section 6.5. UNDERTAKING FOR COSTS.
All parties to this Agreement agree, and each Holder of Type A Units or
Type B Units, by its acceptance of such Type A Units or Type B Units, shall be
deemed to have agreed, that any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this Agreement, or in any suit
against the Agent for any action taken, suffered or omitted by it as Agent, the
filing by any party litigant in such suit of an undertaking to pay the costs of
such suit, and that such court may in its discretion assess reasonable costs,
including reasonable attorneys' fees, against any party litigant in such suit,
having due regard to the merits and good faith of the claims or defenses made by
such party litigant; provided that the provisions of this Section shall not
apply to any suit instituted by the Company, to any suit instituted by the
Agent, to any suit instituted by any Holder, or group of Holders, holding in the
aggregate more than 10% of the Outstanding Securities, or to any suit instituted
by any Holder for the enforcement of interest payable on any Debentures or
Contract Adjustment Payments, if any, on any Purchase Contract on or after the
respective Payment Date therefor in respect of any Security held by such Holder,
or for enforcement of the right to purchase shares of Common Stock under the
Purchase Contracts constituting part of any Security held by such Holder.
Section 6.6. WAIVER OF STAY OR EXTENSION LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Agreement; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the execution of any
power herein granted to the Agent or the Holders, but will suffer and permit the
execution of every such power as though no such law had been enacted.
<PAGE>
ARTICLE VII
The Agent
Section 7.1. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) (1) The Agent undertakes to perform, with respect to the
Securities, such duties and only such duties as are specifically set
forth in this Agreement and the Pledge Agreement, and no implied
covenants or obligations shall be read into this Agreement or the
Pledge Agreement against the Agent; and
(2) in the absence of bad faith or negligence on its part, the
Agent may, with respect to the Securities, conclusively rely, as to the
truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Agent and
conforming to the requirements of this Agreement or the Pledge
Agreement, as applicable, but in the case of any certificates or
opinions which by any provision hereof are specifically required to be
furnished to the Agent, the Agent shall be under a duty to examine the
same to determine whether or not they conform to the requirements of
this Agreement or the Pledge Agreement, as applicable.
(b) No provision of this Agreement or the Pledge Agreement shall be
construed to relieve the Agent from liability for its own negligent action, its
own negligent failure to act, or its own wilful misconduct, except that
(1) this Subsection shall not be construed to limit the
effect of Subsection (a) of this Section;
(2) the Agent shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved
that the Agent was negligent in ascertaining the pertinent facts; and
(3) no provision of this Agreement or the Pledge Agreement
shall require the Agent to expend or risk its own funds or otherwise
incur any financial liability in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if
adequate indemnity is not provided to it.
(c) Whether or not therein expressly so provided, every provision of
this Agreement and the Pledge Agreement relating to the conduct or affecting the
liability of or affording protection to the Agent shall be subject to the
provisions of this Section.
(d) The Agent is authorized to execute and deliver the Pledge Agreement
in its capacity as Agent.
<PAGE>
Section 7.2. NOTICE OF DEFAULT.
Within 30 days after the occurrence of any default by the Company
hereunder of which a Responsible Officer of the Agent has actual knowledge, the
Agent shall transmit by mail to the Company and the Holders of Securities, as
their names and addresses appear in the Register, notice of such default
hereunder, unless such default shall have been cured or waived.
Section 7.3. CERTAIN RIGHTS OF AGENT.
Subject to the provisions of Section 7.1:
(a) the Agent may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been signed
or presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by an Officers' Certificate, Issuer
Order or Issuer Request, and any resolution of the Board of Directors
of the Company may be sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Agreement or the
Pledge Agreement the Agent shall deem it desirable that a matter be
proved or established prior to taking, suffering or omitting any action
hereunder, the Agent (unless other evidence be herein specifically
prescribed) may, in the absence of bad faith on its part, rely upon an
Officers' Certificate of the Company;
(d) the Agent may consult with counsel and the written advice
of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in reliance thereon;
(e) the Agent shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness
or other paper or document, but the Agent, in its discretion, may make
reasonable further inquiry or investigation into such facts or matters
related to the execution, delivery and performance of the Purchase
Contracts as it may see fit, and, if the Agent shall determine to make
such further inquiry or investigation, it shall be given a reasonable
opportunity to examine the books, records and premises of the Company,
personally or by agent or attorney; and
(f) the Agent may execute any of the powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys or an Affiliate and the Agent
<PAGE>
shall not be responsible for any misconduct or negligence on the part
of any agent or attorney or an Affiliate appointed with due care by it
hereunder.
Section 7.4. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Certificates shall be taken as
the statements of the Company, and the Agent assumes no responsibility for their
accuracy, other than for the Certificate of Authentication contained in the
Certificates. The Agent makes no representations as to the validity or
sufficiency of either this Agreement or of the Securities, or of the Pledge
Agreement or the Pledge. The Agent shall not be accountable for the use or
application by the Company of the proceeds in respect of the Purchase Contracts.
Section 7.5. MAY HOLD SECURITIES.
Any Registrar or any other agent of the Company, or the Agent and its
Affiliates, in their individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with the Company, the Collateral
Agent or any other Person with the same rights it would have if it were not
Registrar or such other agent, or the Agent.
Section 7.6. MONEY HELD IN CUSTODY.
Money held by the Agent in custody hereunder need not be segregated
from the other funds except to the extent required by law or provided herein.
The Agent shall be under no obligation to invest or pay interest on any money
received by it hereunder except as otherwise agreed in writing with the Company.
Section 7.7. COMPENSATION AND REIMBURSEMENT.
The Company agrees:
(1) to pay to the Agent from time to time reasonable
compensation for all services rendered by it hereunder and under the
Pledge Agreement;
(2) except as otherwise expressly provided for herein, to
reimburse the Agent upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Agent in accordance
with any provision of this Agreement and the Pledge Agreement
(including the reasonable compensation and the expenses and
disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Agent and any predecessor Agent for, and
to hold it harmless against, any loss, liability or expense incurred
without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of its duties
hereunder, including the costs and expenses of defending itself against
any claim or liability in connection with the exercise or performance
of any of its powers or duties hereunder.
<PAGE>
Section 7.8. CORPORATE AGENT REQUIRED; ELIGIBILITY.
There shall at all times be an Agent hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust powers, having (or being a member of a bank
holding company having) a combined capital and surplus of at least $50,000,000,
subject to supervision or examination by Federal or State authority and having a
Corporate Trust Office in the Borough of Manhattan, The City of New York, if
there be such a corporation in the Borough of Manhattan, The City of New York,
qualified and eligible under this Article and willing to act on reasonable
terms. If such corporation publishes reports of condition at least annually,
pursuant to law or to the requirements of said supervising or examining
authority, then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Agent shall cease to be eligible in accordance with the provisions
of this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
Section 7.9. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of the Agent and no appointment of a
successor Agent pursuant to this Article shall become effective until the
acceptance of appointment by the successor Agent in accordance with the
applicable requirements of Section 7.10.
(b) The Agent may resign at any time by giving written notice thereof
to the Company 60 days prior to the effective date of such resignation. If the
instrument of acceptance by a successor Agent required by Section 7.10 shall not
have been delivered to the Agent within 30 days after the giving of such notice
of resignation, the resigning Agent may petition any court of competent
jurisdiction for the appointment of a successor Agent.
(c) The Agent may be removed at any time by Act of the Holders of a
majority in number of the Outstanding Securities delivered to the Agent and the
Company.
(d) If at any time
(1) the Agent fails to comply with Section 310(b) of the TIA,
as if the Agent were an indenture trustee under an indenture qualified
under the TIA, after written request therefor by the Company or by any
Holder who has been a bona fide Holder of a Security for at least six
months, or
(2) the Agent shall cease to be eligible under Section 7.8 and
shall fail to resign after written request therefor by the Company or
by any such Holder, or
(3) the Agent shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Agent or of its
property shall be appointed or any public officer shall take charge or
control of the Agent or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
<PAGE>
then, in any such case, (i) the Company by a Board Resolution may remove the
Agent, or (ii) any Holder who has been a bona fide Holder of a Security for at
least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the Agent and
the appointment of a successor Agent.
(e) If the Agent shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Agent for any cause, the
Company, by a Board Resolution, shall promptly appoint a successor Agent and
shall comply with the applicable requirements of Section 7.10. If no successor
Agent shall have been so appointed by the Company and accepted appointment in
the manner required by Section 7.10, any Holder who has been a bona fide Holder
of a Security for at least six months may, on behalf of itself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Agent.
(f) The Company shall give, or shall cause such successor Agent to
give, notice of each resignation and each removal of the Agent and each
appointment of a successor Agent by mailing written notice of such event by
first-class mail, postage prepaid, to all Holders as their names and addresses
appear in the applicable Register. Each notice shall include the name of the
successor Agent and the address of its Corporate Trust Office.
Section 7.10. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a) In case of the appointment hereunder of a successor Agent, every
such successor Agent so appointed shall execute, acknowledge and deliver to the
Company and to the retiring Agent an instrument accepting such appointment, and
thereupon the resignation or removal of the retiring Agent shall become
effective and such successor Agent, without any further act, deed or conveyance,
shall become vested with all the rights, powers, agencies and duties of the
retiring Agent; but, on the request of the Company or the successor Agent, such
retiring Agent shall, upon payment of its charges, execute and deliver an
instrument transferring to such successor Agent all the rights, powers and
trusts of the retiring Agent and shall duly assign, transfer and deliver to such
successor Agent all property and money held by such retiring Agent hereunder.
(b) Upon request of any such successor Agent, the Company shall execute
any and all instruments for more fully and certainly vesting in and confirming
to such successor Agent all such rights, powers and agencies referred to in
paragraph (a) of this Section.
(c) No successor Agent shall accept its appointment unless at the time
of such acceptance such successor Agent shall be qualified and eligible under
this Article.
Section 7.11. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any corporation into which the Agent may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Agent shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Agent, shall be the successor of the Agent hereunder, provided such
corporation shall be otherwise qualified and eligible under this Article, with
the execution or filing of any paper or any further act on the part of any of
the parties hereto. In case any
<PAGE>
Certificates shall have been authenticated and executed on behalf of the
Holders, but not delivered, by the Agent then in office, any successor by
merger, conversion or consolidation to such Agent may adopt such authentication
and execution and deliver the Certificates so authenticated and executed with
the same effect as if such successor Agent had itself authenticated and executed
such Securities.
Section 7.12. PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.
(a) The Agent shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders received by the Agent in its
capacity as Registrar.
(b) If three or more Holders (herein referred to as "applicants") apply
in writing to the Agent, and furnish to the Agent reasonable proof that each
such applicant has owned a Security for a period of at least six months
preceding the date of such application, and such application states that the
applicants desire to communicate with other Holders with respect to their rights
under this Agreement or under the Securities and is accompanied by a copy of the
form of proxy or other communication which such applicants propose to transmit,
then the Agent shall mail to all the Holders copies of the form of proxy or
other communication which is specified in such request, with reasonable
promptness after a tender to the Agent of the materials to be mailed and of
payment, or provision for the payment, of the reasonable expenses of such
mailing.
Section 7.13. NO OBLIGATIONS OF AGENT.
Except to the extent otherwise expressly provided in this Agreement,
the Agent assumes no obligations and shall not be subject to any liability under
this Agreement, the Pledge Agreement or any Purchase Contract in respect of the
obligations of the Holder of any Security thereunder. The Company agrees, and
each Holder of a Certificate, by his acceptance thereof, shall be deemed to have
agreed, that the Agent's execution of the Certificates on behalf of the Holders
shall be solely as agent and attorney-in-fact for the Holders, and that the
Agent shall have no obligation to perform such Purchase Contracts on behalf of
the Holders, except to the extent expressly provided in Article Five hereof.
Anything in this Agreement to the contrary notwithstanding, in no event shall
the Agent or its officers, employees or agents be liable under this Agreement to
any third party for indirect, special, punitive, or consequential loss or damage
of any kind whatsoever, including lost profits, whether or not the likelihood of
such loss or damage was known to the Agent, incurred without any act or deed
that is found to be attributable to gross negligence or willful misconduct on
the part of the Agent.
Section 7.14. TAX COMPLIANCE.
(a) The Company will comply with all applicable certification,
information reporting and withholding (including "backup" withholding)
requirements imposed by applicable tax laws, regulations or administrative
practice with respect to (i) any payments made with respect to the Securities or
(ii) the issuance, delivery, holding, transfer, redemption or exercise of rights
under the Securities. Such compliance shall include, without limitation, the
preparation and timely filing of required returns and the timely payment of all
amounts required to be withheld to the appropriate taxing authority or its
designated agent.
<PAGE>
(b) The Agent shall comply in accordance with the terms hereof with any
written direction received from the Company with respect to the execution or
certification of any required documentation and the application of such
requirements to particular payments or Holders or in other particular
circumstances, and may for purposes of this Agreement rely on any such direction
in accordance with the provisions of Section 7.1(a)(2) hereof.
(c) The Agent shall maintain all appropriate records documenting
compliance with such requirements, and shall make such records available, on
written request, to the Company or its authorized representative within a
reasonable period of time after receipt of such request.
ARTICLE VIII
Supplemental Agreements
Section 8.1. SUPPLEMENTAL AGREEMENTS WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holders, the Company and the Agent, at any
time and from time to time, may enter into one or more agreements supplemental
hereto, in form satisfactory to the Company and the Agent, for any of the
following purposes:
(1) to evidence the succession of another Person to the
Company, and the assumption by any such successor of the covenants of
the Company herein and in the Certificates; or
(2) to add to the covenants of the Company for the benefit of
the Holders, or to surrender any right or power herein conferred upon
the Company; or
(3) to evidence and provide for the acceptance of appointment
hereunder by a successor Agent; or
(4) to make provision with respect to the rights of Holders
pursuant to the requirements of Section 5.6(b); or
(5) except as provided for in Section 5.6, to cure any
ambiguity, to correct or supplement any provisions herein which may be
inconsistent with any other provisions herein, or to make any other
provisions with respect to such matters or questions arising under this
Agreement, provided such action shall not adversely affect the
interests of the Holders.
Section 8.2. SUPPLEMENTAL AGREEMENTS WITH CONSENT OF HOLDERS.
With the consent of the Holders of not less than a majority of the
outstanding Purchase Contracts voting together as one class, by Act of said
Holders delivered to the Company and the Agent, the Company, when authorized by
a Board Resolution, and the Agent may enter into an agreement or agreements
supplemental hereto for the purpose of modifying in any manner the
<PAGE>
terms of the Purchase Contracts, or the provisions of this Agreement or the
rights of the Holders in respect of the Securities; provided, however, that,
except as contemplated herein, no such supplemental agreement shall, without the
unanimous consent of the Holders of each outstanding Purchase Contract affected
thereby,
(1) change any Payment Date;
(2) change the amount or the type of Collateral required to be
Pledged to secure a Holder's obligations under the Purchase Contract,
impair the right of the Holder of any Purchase Contract to receive
interest on the related Collateral (except for the rights of Holders of
Type A Units to substitute the Treasury Securities for the Pledged
Debentures or the rights of Holders of Type B Units to substitute
Debentures for the Pledged Treasury Securities) or otherwise adversely
affect the Holder's rights in or to such Collateral or adversely alter
the rights in or to such Collateral;
(3) reduce any Contract Adjustment Payments or change any
place where, or the coin or currency in which, any Contract Adjustment
Payment is payable;
(4) impair the right to institute suit for the enforcement of
any Purchase Contract;
(5) reduce the number of shares of Common Stock to be
purchased pursuant to any Purchase Contract, increase the price to
purchase shares of Common Stock upon settlement of any Purchase
Contract, change the Purchase Contract Settlement Date or otherwise
adversely affect the Holder's rights under any Purchase Contract; or
(6) reduce the percentage of the outstanding Purchase
Contracts the consent of whose Holders is required for any such
supplemental agreement;
PROVIDED that if any amendment or proposal referred to above would adversely
affect only the Type A Units or the Type B Units, then only the affected class
of Holder as of the record date for the Holders entitled to vote thereon will be
entitled to vote on such amendment or proposal, and such amendment or proposal
shall not be effective except with the consent of Holders of not less than a
majority of such class; provided that the unanimous consent of the Holders of
each outstanding Purchase Contract of such class affected thereby shall be
required to approve any amendment or proposal specified in clauses (1) - (6)
above.
It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental agreement, but it shall
be sufficient if such Act shall approve the substance thereof.
Section 8.3. EXECUTION OF SUPPLEMENTAL AGREEMENTS.
In executing, or accepting the additional agencies created by, any
supplemental agreement permitted by this Article or the modifications thereby of
the agencies created by this Agreement, the Agent shall be entitled to receive,
and (subject to Section 7.1) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental agreement is
<PAGE>
authorized or permitted by this Agreement. The Agent may, but shall not be
obligated to, enter into any such supplemental agreement which affects the
Agent's own rights, duties or immunities under this Agreement or otherwise.
Section 8.4. EFFECT OF SUPPLEMENTAL AGREEMENTS.
Upon the execution of any supplemental agreement under this Article,
this Agreement shall be modified in accordance therewith, and such supplemental
agreement shall form a part of this Agreement for all purposes; and every Holder
of Certificates theretofore or thereafter authenticated, executed on behalf of
the Holders and delivered hereunder, shall be bound thereby.
Section 8.5. REFERENCE TO SUPPLEMENTAL AGREEMENTS.
Certificates authenticated, executed on behalf of the Holders and
delivered after the execution of any supplemental agreement pursuant to this
Article may, and shall if required by the Agent, bear a notation in form
approved by the Agent as to any matter provided for in such supplemental
agreement. If the Company shall so determine, new Certificates so modified as to
conform, in the opinion of the Agent and the Company, to any such supplemental
agreement may be prepared and executed by the Company and authenticated,
executed on behalf of the Holders and delivered by the Agent in exchange for
Outstanding Certificates.
ARTICLE IX
Consolidation, Merger, Sale or Conveyance
Section 9.1. COVENANT NOT TO MERGE, CONSOLIDATE, SELL OR CONVEY PROPERTY
EXCEPT UNDER CERTAIN CONDITIONS.
The Company covenants that it will not merge or consolidate with any
other Person or sell, assign, transfer, lease or convey all or substantially all
of its properties and assets to any Person or group of affiliated Persons in one
transaction or a series of related transactions, unless (i) either the Company
shall be the continuing corporation, or the successor (if other than the
Company) shall be a corporation organized and existing under the laws of the
United States of America or a State thereof or the District of Columbia and such
corporation shall expressly assume all the obligations of the Company under the
Purchase Contracts, this Agreement and the Pledge Agreement by one or more
supplemental agreements in form reasonably satisfactory to the Agent and the
Collateral Agent, executed and delivered to the Agent and the Collateral Agent
by such corporation, and (ii) the Company or such successor corporation, as the
case may be, shall not, immediately after such merger or consolidation, or such
sale, assignment, transfer, lease or conveyance, be in default in the
performance of any covenant or condition hereunder, under any of the Securities
or under the Pledge Agreement.
Section 9.2. RIGHTS AND DUTIES OF SUCCESSOR CORPORATION.
<PAGE>
In case of any such consolidation, merger, sale, assignment, transfer,
lease or conveyance and upon any such assumption by a successor corporation in
accordance with Section 9.1, such successor corporation shall succeed to and be
substituted for the Company with the same effect as if it had been named herein
as the Company. Such successor corporation thereupon may cause to be signed, and
may issue either in its own name or in the name of Polaroid Corporation, any or
all of the Certificates evidencing Securities issuable hereunder which
theretofore shall not have been signed by the Company and delivered to the
Agent; and, upon the order of such successor corporation, instead of the
Company, and subject to all the terms, conditions and limitations in this
Agreement prescribed, the Agent shall authenticate and execute on behalf of the
Holders and deliver any Certificates which previously shall have been signed and
delivered by the officers of the Company to the Agent for authentication and
execution, and any Certificate evidencing Securities which such successor
corporation thereafter shall cause to be signed and delivered to the Agent for
that purpose. All the Certificates issued shall in all respects have the same
legal rank and benefit under this Agreement as the Certificates theretofore or
thereafter issued in accordance with the terms of this Agreement as though all
of such Certificates had been issued at the date of the execution hereof.
In case of any such consolidation, merger, sale, assignment, transfer,
lease or conveyance such change in phraseology and form (but not in substance)
may be made in the Certificates evidencing Securities thereafter to be issued as
may be appropriate.
Section 9.3. OPINION OF COUNSEL GIVEN TO AGENT.
The Agent, subject to Sections 7.1 and 7.3, shall receive an Opinion of
Counsel as conclusive evidence that any such consolidation, merger, sale,
assignment, transfer, lease or conveyance, and any such assumption, complies
with the provisions of this Article and that all conditions precedent to the
consummation of any such consolidation, merger, sale, assignment, transfer,
lease or conveyance have been met.
ARTICLE X
Covenants
Section 10.1. PERFORMANCE UNDER PURCHASE CONTRACTS.
The Company covenants and agrees for the benefit of the Holders from
time to time of the Securities that it will duly and punctually perform its
obligations under the Purchase Contracts in accordance with the terms of the
Purchase Contracts and this Agreement.
Section 10.2. MAINTENANCE OF OFFICE OR AGENCY.
The Company will maintain in the Borough of Manhattan, The City of New
York an office or agency where Certificates may be presented or surrendered for
acquisition of shares of Common Stock upon settlement of the Purchase Contracts
on the Purchase Contract Settlement Date or Early Settlement and for transfer of
Collateral upon occurrence of a Termination Event,
<PAGE>
where Certificates may be surrendered for registration of transfer or exchange,
for a Collateral Substitution or re-establishment of a Type A Unit and where
notices and demands to or upon the Company in respect of the Securities and this
Agreement may be served. The Company will give prompt written notice to the
Agent of the location, and any change in the location, of such office or agency.
If at any time the Company shall fail to maintain any such required office or
agency or shall fail to furnish the Agent with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office, and the Company hereby appoints the Agent as its agent
to receive all such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more other
offices or agencies where Certificates may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York for such purposes. The Company will
give prompt written notice to the Agent of any such designation or rescission
and of any change in the location of any such other office or agency. The
Company hereby designates as the place of payment for the Securities the
Corporate Trust Office and appoints the Agent at its Corporate Trust Office as
paying agent in such city.
Section 10.3. COMPANY TO RESERVE COMMON STOCK.
The Company shall at all times prior to the Purchase Contract
Settlement Date reserve and keep available, free from preemptive rights, out of
its authorized but unissued Common Stock the full number of shares of Common
Stock issuable against tender of payment in respect of all Purchase Contracts
constituting a part of the Securities evidenced by Outstanding Certificates.
Section 10.4. COVENANTS AS TO COMMON STOCK.
The Company covenants that all shares of Common Stock which may be
issued against tender of payment in respect of any Purchase Contract
constituting a part of the Outstanding Securities will, upon issuance, be duly
authorized, validly issued, fully paid and nonassessable.
Section 10.5. STATEMENTS OF OFFICERS OF THE COMPANY AS TO DEFAULT.
The Company will deliver to the Agent, within 120 days after the end of
each fiscal year of the Company (which as of the date hereof is January 2)
ending after the date hereof, an Officers' Certificate (one of the signers of
which shall be the principal executive officer, principal financial officer or
principal accounting officer of the Company), stating whether or not to the best
knowledge of the signers thereof the Company is in default in the performance
and observance of any of the terms, provisions and conditions hereof, and if the
Company shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge.
Section 10.6. ERISA .
<PAGE>
Each Holder from time to time of the Type A Units which is a Plan
hereby represents that its acquisition of the Type A Units and the holding of
the same satisfies the applicable fiduciary requirements of ERISA and that it is
entitled to exemption relief from the prohibited transaction provisions of ERISA
and the Code in accordance with one or more prohibited transaction exemptions or
otherwise will not result in a nonexempt prohibited transaction.
[THE REST OF THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY; THE
SIGNATURE PAGE FOLLOWS:]
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
POLAROID CORPORATION
By: _______________________________
Name:
Title:
[__________________________], as
Purchase Contract Agent
By: _______________________________
Name:
Title:
<PAGE>
EXHIBIT A
FACE OF TYPE A UNIT CERTIFICATE
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"),
OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR
CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS
CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
NO. _______ CUSIP NO. [____________]
NUMBER OF TYPE A UNITS ________
POLAROID CORPORATION
TYPE A UNIT
This Type A Unit Certificate certifies that Cede & Co. is the
registered Holder of the number of Type A Units set forth above. Each Type A
Unit consists of (i) the beneficial ownership by the Holder of one Debenture
(the "Debenture") of Polaroid Corporation, a Delaware corporation (the
"Company"), having a principal amount of $______, subject to the Pledge of such
Debenture by such Holder pursuant to the Pledge Agreement, and (ii) the rights
and obligations of the Holder under one Purchase Contract with the Company. All
capitalized terms used herein which are defined in the Purchase Contract
Agreement (as defined on the reverse hereof) have the meaning set forth therein.
Pursuant to the Pledge Agreement, the Debenture constituting part of
each Type A Unit evidenced hereby has been pledged to the Collateral Agent, for
the benefit of the Company, to
A-1
<PAGE>
secure the obligations of the Holder under the Purchase Contract comprising a
portion of such Type A Unit.
The Pledge Agreement provides that all payments of the principal amount
with respect to any of the Pledged Debentures or cash interest on any Pledged
Debenture (as defined in the Pledge Agreement) constituting part of the Type A
Units received by the Securities Intermediary shall be paid by wire transfer in
same day funds (i) in the case of (A) cash interest with respect to Pledged
Debentures and (B) any payments of the principal amount with respect to any
Debenture or security entitlements thereto that have been released from the
Pledge pursuant to the Pledge Agreement, to the Agent to the account designated
by the Agent, no later than 12:00 p.m., New York City time, on the Business Day
such payment is received by the Securities Intermediary (provided that in the
event such payment is received by the Securities Intermediary on a day that is
not a Business Day or after 12:30 p.m., New York City time, on a Business Day,
then such payment shall be made no later than 10:30 a.m., New York City time, on
the next succeeding Business Day) and (ii) in the case of Proceeds from the
Remarketing with respect to any of the Pledged Debentures or security
entitlements thereto, to the Company on the Purchase Contract Settlement Date
(as described herein) in accordance with the terms of the Pledge Agreement, in
full satisfaction of the respective obligations of the Holders of the Type A
Units of which such Pledged Debenture is a part under the Purchase Contracts
forming a part of such Type A Units. Interest on any Debenture forming part of a
Type A Unit evidenced hereby, which is payable quarterly in arrears on
[_______________], [_______________], [_______________] and [_______________] of
each year, commencing [_______________], [ ] (a "Payment Date"), shall, subject
to receipt thereof by the Agent from the Securities Intermediary, be paid to the
Person in whose name this Type A Unit Certificate (or a Predecessor Type A Unit
Certificate) is registered at the close of business on the Record Date for such
Payment Date.
Each Purchase Contract evidenced hereby obligates the Holder of this
Type A Unit Certificate to purchase, and the Company to sell, on [__________], [
] the "Purchase Contract Settlement Date"), at a price equal to [$50] (the
"Stated Amount"), a number of Common Shares, par value $1.00 ("Common Stock"),
of the Company, equal to the Settlement Rate, unless on or prior to the Purchase
Contract Settlement Date there shall have occurred a Termination Event or an
Early Settlement with respect to the Type A Unit of which such Purchase Contract
is a part, all as provided in the Purchase Contract Agreement and more fully
described on the reverse hereof. The purchase price (the "Purchase Price") for
the shares of Common Stock purchased pursuant to each Purchase Contract
evidenced hereby, if not paid earlier, shall be paid on the Purchase Contract
Settlement Date by separate cash or by application of payment received, pursuant
to the Remarketing, in respect of the principal amount with respect to any
Pledged Debentures pledged to secure the obligations under such Purchase
Contract of the Holder of the Type A Unit of which such Purchase Contract is a
part.
The Company shall pay, on each Payment Date, in respect of each
Purchase Contract forming part of a Type A Unit evidenced hereby an amount (the
"Contract Adjustment Payments") equal to (a) if a Reset Transaction has not
occurred, [___]% per annum of the Stated Amount or (b) following the occurrence
of a Reset Transaction, the Adjusted Contract Adjustment Payment Rate related to
such Reset Transaction until any such succeeding Reset Transaction shall occur
(computed on the basis of (i) for any full quarterly period, a 360-day year
A-2
<PAGE>
of twelve 30-day months and (ii) for any period shorter than a full quarterly
period, a 30-day month and for periods less than a month, the actual number of
days elapsed per 30-day period). Such Contract Adjustment Payments shall be
payable to the Person in whose name this Type A Unit Certificate (or a
Predecessor Type A Unit Certificate) is registered at the close of business on
the Record Date for such Payment Date.
Interest on the Debentures and Contract Adjustment Payments will be
payable at the office of the Agent in The City of New York or, at the option of
the Company, by check mailed to the address of the Person entitled thereto as
such address appears on the Type A Units Register.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by
the Agent by manual signature, this Type A Unit Certificate shall not be
entitled to any benefit under the Pledge Agreement or the Purchase Contract
Agreement or be valid or obligatory for any purpose.
A-3
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
POLAROID CORPORATION
By: _______________________________
Name:
Title:
By: _______________________________
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the Purchase
Contracts evidenced hereby)
By: [_____________________________]
not individually but solely as
Attorney-in-Fact of such Holder
By: _______________________________
Name:
Title:
Dated:
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Type A Unit Certificates referred to in the within
mentioned Purchase Contract Agreement.
By: [______________________________]
as Purchase Contract Agent
By: _______________________________
Authorized Officer
(FORM OF REVERSE OF TYPE A UNIT CERTIFICATE)
A-4
<PAGE>
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of [_______________], 1999 (as may be supplemented
from time to time, the "Purchase Contract Agreement"), between the Company and
[_______________________________], as Purchase Contract Agent (including its
successors hereunder, the "Agent"), to which Purchase Contract Agreement and
supplemental agreements thereto reference is hereby made for a description of
the respective rights, limitations of rights, obligations, duties and immunities
thereunder of the Agent, the Company, and the Holders and of the terms upon
which the Type A Unit Certificates are, and are to be, executed and delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Type A Unit Certificate to purchase, and the Company to sell, on the Purchase
Contract Settlement Date at a price equal to the Stated Amount (the "Purchase
Price"), a number of shares of Common Stock of the Company equal to the
Settlement Rate, unless, on or prior to the Purchase Contract Settlement Date,
there shall have occurred a Termination Event with respect to the Security of
which such Purchase Contract is a part or an Early Settlement shall have
occurred. The "Settlement Rate" is equal to (a) if the Applicable Market Value
(as defined below) is equal to or greater than $[_______] (the "Threshold
Appreciation Price"), [__________] shares of Common Stock per Purchase Contract,
(b) if the Applicable Market Value is less than the Threshold Appreciation Price
but is greater than $[_______] the number of shares of Common Stock per Purchase
Contract equal to the Stated Amount divided by the Applicable Market Value and
(c) if the Applicable Market Amount is less than or equal to $[________],
[________] shares of Common Stock per Purchase Contract, in each case subject to
adjustment as provided in the Purchase Contract Agreement. No fractional shares
of Common Stock will be issued upon settlement of Purchase Contracts, as
provided in the Purchase Contract Agreement.
Each Purchase Contract evidenced hereby, which is settled either through
Early Settlement or Cash Settlement, shall obligate the Holder of the related
Type A Units to purchase at the Purchase Price, and the Company to sell, a
number of newly issued shares of Common Stock equal to the Early Settlement Rate
or the Settlement Rate, as applicable.
The "Applicable Market Value" means the average of the Closing Price per
share of Common Stock on each of the 20 Trading Days ending on the third Trading
Day immediately preceding the Purchase Contract Settlement Date. The "Closing
Price" of the Common Stock on any date of determination means (i) the closing
sale price (or, if no closing price is reported, the last reported sale price)
of the Common Stock on the New York Stock Exchange (the "NYSE") on such date,
(ii) if the Common Stock is not listed for trading on the NYSE on any such date,
the closing sale price as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, (iii) if the Common Stock is not so listed on a United States national
or regional securities exchange, the closing sale price as reported by The
Nasdaq Stock Market, (iv) if the Common Stock is not so reported, the last
quoted bid price for the Common Stock in the over-the-counter market as reported
by the National Quotation Bureau or similar organization, or (v) if such bid
price is not available, the average of the mid-point of the last bid and ask
prices of the Common Stock on such date from at least three nationally
recognized independent investment banking firms retained for this purpose by the
Company. A "Trading Day" means a day on which the Common Stock (A) is not
A-5
<PAGE>
suspended from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and (B) has
traded at least once on the national or regional securities exchange or
association or over-the-counter market that is the primary market for the
trading of the Common Stock.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Type A Unit Certificate may pay the Purchase Price for the shares
of Common Stock purchased pursuant to each Purchase Contract evidenced hereby by
effecting a Cash Settlement or an Early Settlement or a remarketing of the
related Pledged Debentures. A Holder of Type A Units who does not effect, on or
prior to 11:00 a.m. New York City time on the fifth Business Day immediately
preceding the Purchase Contract Settlement Date, an effective Cash Settlement or
an Early Settlement, shall pay the Purchase Price for the shares of Common Stock
to be issued under the related Purchase Contract from the proceeds of the sale
of the related Pledged Debentures held by the Collateral Agent. Such sale will
be made by the Remarketing Agent pursuant to the terms of the Remarketing
Agreement on the third Business Day prior to the Purchase Contract Settlement
Date. If, as provided in the Purchase Contract Agreement, upon the occurrence of
a Failed Remarketing the Collateral Agent, for the benefit of the Company,
exercises its rights as a secured creditor with respect to the Pledged
Debentures related to this Type A Unit Certificate, any accrued and unpaid
interest on such Pledged Debentures will become payable by the Company to the
holder of this Type A Unit Certificate in the manner provided for in the
Purchase Contract Agreement.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment of the aggregate purchase price for
the shares of Common Stock to be purchased thereunder in the manner herein set
forth.
Each Purchase Contract evidenced hereby and all obligations and rights
of the Company and the Holder thereunder shall terminate if a Termination Event
shall occur. Upon the occurrence of a Termination Event, the Company shall give
written notice to the Agent and to the Holders, at their addresses as they
appear in the Type A Units Register. Upon and after the occurrence of a
Termination Event, the Collateral Agent shall release the Pledged Debenture
forming a part of each Type A Unit from the Pledge. A Type A Unit shall
thereafter represent the right to receive the Debenture forming a part of such
Type A Unit in accordance with the terms of the Purchase Contract Agreement and
the Pledge Agreement.
Under the terms of the Pledge Agreement, the Agent will be entitled to
exercise the voting and any other consensual rights pertaining to the Pledged
Debentures. Upon receipt of notice of any meeting at which holders of Debentures
are entitled to vote or upon the solicitation of consents, waivers or proxies of
holders of Debentures, the Agent shall, as soon as practicable thereafter, mail
to the Type A Unit Holders a notice (a) containing such information as is
contained in the notice or solicitation, (b) stating that each Type A Unit
Holder on the record date set by the Agent therefor (which, to the extent
possible, shall be the same date as the record date for determining the holders
of Debentures entitled to vote) shall be entitled to instruct the Agent as to
the exercise of the voting rights pertaining to the Debentures constituting a
part of such Holder's Type A Units and (c) stating the manner in which such
instructions may be given.
A-6
<PAGE>
Upon the written request of the Type A Unit Holders on such record date, the
Agent shall endeavor insofar as practicable to vote or cause to be voted, in
accordance with the instructions set forth in such requests, the maximum
aggregate principal amount of Debentures as to which any particular voting
instructions are received. In the absence of specific instructions from the
Holder of a Type A Unit, the Agent shall abstain from voting the Debentures
evidenced by such Type A Unit.
The Type A Unit Certificates are issuable only in registered form and
only in denominations of a single Type A Unit and any integral multiple thereof.
The transfer of any Type A Unit Certificate will be registered and Type A Unit
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The Type A Units Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents permitted by the Purchase
Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Agent may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. A holder who elects to substitute a Treasury
Security for Debentures, thereby creating Type B Units, shall be responsible for
any fees or expenses payable in connection therewith. Except as provided in the
Purchase Contract Agreement, for so long as the Purchase Contract underlying a
Type A Unit remains in effect, such Type A Unit shall not be separable into its
constituent parts, and the rights and obligations of the Holder of such Type A
Unit in respect of the Debenture and Purchase Contract constituting such Type A
Unit may be transferred and exchanged only as a Type A Unit. The holder of a
Type A Unit may substitute for the Pledged Debentures securing its obligation
under the related Purchase Contract Treasury Securities in an aggregate
principal amount equal to the aggregate principal amount of the Pledged
Debentures in accordance with the terms of the Purchase Contract Agreement and
the Pledge Agreement. From and after such Collateral Substitution, the Security
for which such Pledged Treasury Securities secures the holder's obligation under
the Purchase Contract shall be referred to as a "Type B Unit." A Holder may make
such Collateral Substitution only in integral multiples of 20 Type A Units for
20 Type B Units. Such Collateral Substitution may cause the equivalent aggregate
principal amount of this Certificate to be increased or decreased; PROVIDED,
HOWEVER, this Type A Unit Certificate shall not represent more than ____ Type A
Units. All such adjustments to the equivalent aggregate principal amount of this
Type A Unit Certificate shall be duly recorded by placing an appropriate
notation on the Schedule attached hereto.
A Holder of Type B Units may recreate Type A Units by delivering to the
Securities Intermediary Debentures with an aggregate principal amount equal to
the aggregate principal amount of the Pledged Treasury Securities in exchange
for the release of such Pledged Treasury Securities in accordance with the terms
of the Purchase Contract Agreement and the Pledge Agreement.
The Company shall pay, on each Payment Date, the Contract Adjustment
Payments payable in respect of each Purchase Contract to the Person in whose
name the Type A Unit Certificate evidencing such Purchase Contract is registered
at the close of business on the Record Date for such Payment Date. Contract
Adjustment Payments will be payable at the office of the Agent in The City of
New York or, at the option of the Company, by check mailed to the address of the
Person entitled thereto at such address as it appears on the Type A Units
Register.
A-7
<PAGE>
The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay any Contract Adjustment
Payments, shall immediately and automatically terminate, without the necessity
of any notice or action by any Holder, the Agent or the Company, if, on or prior
to the Purchase Contract Settlement Date, a Termination Event shall have
occurred. Upon the occurrence of a Termination Event, the Company shall promptly
but in no event later than two Business Days thereafter give written notice to
the Agent, the Collateral Agent and the Holders, at their addresses as they
appear in the Type A Units Register. Upon and after the occurrence of a
Termination Event, the Collateral Agent shall release the Debentures from the
Pledge in accordance with the provisions of the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
underlying Securities may be settled early ("Early Settlement") as provided in
the Purchase Contract Agreement. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contracts evidenced by this Type A Unit
Certificate, the Holder of this Type A Unit Certificate shall deliver this Type
A Unit Certificate to the Agent at the Corporate Trust Office duly endorsed for
transfer to the Company or in blank with the form of Election to Settle Early
set forth below duly completed and accompanied by payment in the form of
immediately available funds payable to the order of the Company in an amount
(the "Early Settlement Amount") equal to (i) the product of (A) the Stated
Amount times (B) the number of Purchase Contracts with respect to which the
Holder has elected to effect Early Settlement, plus (ii) if such delivery is
made with respect to any Purchase Contracts during the period from the close of
business on any Record Date for any Payment Date to the opening of business on
such Payment Date, an amount equal to the Contract Adjustment Payments payable
on such Payment Date with respect to such Purchase Contracts. Upon Early
Settlement of Purchase Contracts by a Holder of the related Securities, the
Pledged Debentures underlying such Securities shall be released from the Pledge
as provided in the Pledge Agreement and the Holder shall be entitled to receive
a number of shares of Common Stock on account of each Purchase Contract forming
part of a Type A Unit as to which Early Settlement is effected equal to the
Early Settlement Rate. The Early Settlement Rate shall initially be equal
to[_______] shares of Common Stock and shall be adjusted in the same manner and
at the same time as the Settlement Rate is adjusted as provided in the Purchase
Contract Agreement.
Upon registration of transfer of this Type A Unit Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract Agreement
and the Purchase Contracts evidenced hereby and the transferor shall be released
from the obligations under the Purchase Contracts evidenced by this Type A Unit
Certificate. The Company covenants and agrees, and the Holder, by its acceptance
hereof, likewise covenants and agrees, to be bound by the provisions of this
paragraph.
The Holder of this Type A Unit Certificate, by its acceptance hereof,
authorizes the Agent to enter into and perform the related Purchase Contracts
forming part of the Type A Units evidenced hereby on its behalf as its
attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Purchase Contracts by the Company or its trustee in the event
that the Company becomes the subject of a case under the Bankruptcy Code, agrees
to be bound
A-8
<PAGE>
by the terms and provisions thereof, covenants and agrees to perform his
obligations under such Purchase Contracts, consents to the provisions of the
Purchase Contract Agreement, authorizes the Agent to enter into and perform the
Purchase Contract Agreement and the Pledge Agreement on its behalf as its
attorney-in-fact, and consents to the Pledge of the Debentures underlying this
Type A Unit Certificate pursuant to the Pledge Agreement. The Holder further
covenants and agrees that, to the extent and in the manner provided in the
Purchase Contract Agreement and the Pledge Agreement, but subject to the terms
thereof, Proceeds from the Remarketing with respect to any of the Pledged
Debentures or security entitlements thereto in respect of the aggregate
principal amount of the Pledged Debentures on the Purchase Contract Settlement
Date shall be paid by the Collateral Agent to the Company in satisfaction of
such Holder's obligations under such Purchase Contract and such Holder shall
acquire no right, title or interest in such payments.
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.
The Company, the Agent and its Affiliates and any agent of the Company
or the Agent may treat the Person in whose name this Type A Unit Certificate is
registered as the owner of the Type A Units evidenced hereby for the purpose of
receiving payments of interest payable quarterly on the Debentures, receiving
payments of Contract Adjustment Payments, performance of the Purchase Contracts
and for all other purposes whatsoever, whether or not any payments in respect
thereof be overdue and notwithstanding any notice to the contrary, and neither
the Company, the Agent nor any such agent shall be affected by notice to the
contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection at
the offices of the Agent.
A-9
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
UNIF GIFT MIN ACT - ---------------Custodian---------------
(cust) (minor)
Under Uniform Gifts to Minors Act of _______
____________________________________________
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship
and not as tenants in common
Additional abbreviations may also be used though not in the above list.
-------------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto _________________________________________________________
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please Print or Type Name and Address Including Postal Zip Code of
Assignee) the within Type A Unit Certificates and all rights thereunder,
hereby irrevocably constituting and appointing ______________________
attorney to transfer said Type A Unit Certificates on the books of Polaroid
Corporation with full power of substitution in the premises.
Dated: ___________________ _____________________________________________
Signature
NOTICE: The signature to this assignment must
correspond with the name as it appears upon
the face of the within Type A Unit
Certificates in every particular, without
alteration or enlargement or any change
whatsoever.
Signature Guarantee: ___________________________________
A-10
<PAGE>
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Type A Units evidenced
by this Type A Unit Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional share, to the undersigned at
the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
<TABLE>
<S> <C>
Dated: _______________________ _____________________________________
Signature
Signature Guarantee: _________________
(if assigned to another person)
If shares are to be registered in the
name of and delivered to a Person other REGISTERED HOLDER
than the Holder, please (i) print such
Person's name and address and (ii)
provide a guarantee of your signature:
Please print name and
address of Registered
Holder:
- ------------------------------------- -------------------------------------
Name Name
- ------------------------------------- -------------------------------------
Address Address
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
Social Security or other
Taxpayer Identification _____________________________________
Number, if any
</TABLE>
A-11
<PAGE>
ELECTION TO SETTLE EARLY
The undersigned Holder of this Type A Unit Certificate hereby
irrevocably exercises the option to effect Early Settlement in accordance with
the terms of the Purchase Contract Agreement with respect to the Purchase
Contracts underlying the number of Type A Units evidenced by this Type A Unit
Certificate specified below. The undersigned Holder directs that a certificate
for shares of Common Stock deliverable upon such Early Settlement be registered
in the name of, and delivered, together with a check in payment for any
fractional share and any Type A Unit Certificate representing any Type A Units
evidenced hereby as to which Early Settlement of the related Purchase Contracts
is not effected, to the undersigned at the address indicated below unless a
different name and address have been indicated below. Pledged Debentures
deliverable upon such Early Settlement will be transferred in accordance with
the transfer instructions set forth below. If shares are to be registered in the
name of a Person other than the undersigned, the undersigned will pay any
transfer tax payable incident thereto.
Dated: ______________________ _____________________________________
Signature
Signature Guarantee: _____________________________________
A-12
<PAGE>
Number of Securities evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
<TABLE>
<S> <C>
If shares of Common Stock or Type A Unit REGISTERED HOLDER
Certificates are to be registered in the
name of and delivered to, and Pledged
Debentures are to be transferred to, a
Person other than the Holder, please print
such Person's name and address:
Please print name and
address of Registered
Holder:
- ------------------------------------- -------------------------------------
Name Name
- ------------------------------------- -------------------------------------
Address Address
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
Social Security or other
Taxpayer Identification
Number, if any _____________________________________
</TABLE>
A-13
<PAGE>
Transfer Instructions for Pledged Debentures Transferable Upon Early Settlement
or a Termination Event:
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
- ------------------------------------------------------------------------------
A-14
<PAGE>
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global
Certificate have been made:
<TABLE>
<CAPTION>
======================= ======================= ====================== ======================= ======================
Number of UNITS
Amount of decrease in Amount of increase in evidenced by this
Number of UNITS Number of UNITS Global Certificate Signature of authorized
evidenced by the evidenced by the following such officer of Trustee or
Date Global Certificate Global Certificate decrease or increase Securities Custodian
<S> <C> <C> <C> <C>
======================= ======================= ====================== ======================= ======================
</TABLE>
A-15
<PAGE>
EXHIBIT B
FACE OF TYPE B UNIT CERTIFICATE
"THIS CERTIFICATE IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
PURCHASE CONTRACT AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE
NAME OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (THE "DEPOSITARY"),
OR A NOMINEE OF THE DEPOSITARY. THIS CERTIFICATE IS EXCHANGEABLE FOR
CERTIFICATES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS
NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE PURCHASE CONTRACT
AGREEMENT AND NO TRANSFER OF THIS CERTIFICATE (OTHER THAN A TRANSFER OF THIS
CERTIFICATE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITARY FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN."
NO. _____ CUSIP NO. [___________]
NUMBER OF TYPE B UNITS _________
POLAROID CORPORATION
TYPE B UNIT
This Type B Unit Certificate certifies that Cede & Co. is the registered
Holder of the number of Type B Units set forth above. Each Type B Unit consists
of (i) a 1/20 undivided beneficial ownership interest of a Treasury Security
having a principal amount at maturity equal to $1,000, subject to the Pledge of
such Treasury Security by such Holder pursuant to the Pledge Agreement, and (ii)
the rights and obligations of the Holder under one Purchase Contract with
Polaroid Corporation, a Delaware corporation (the "Company"). All capitalized
terms used herein which are defined in the Purchase Contract Agreement (as
defined on the reverse hereof) have the meaning set forth therein.
<PAGE>
Pursuant to the Pledge Agreement, the Treasury Securities constituting
part of each Type B Unit evidenced hereby have been pledged to the Collateral
Agent, for the benefit of the Company, to secure the obligations of the Holder
under the Purchase Contract comprising a portion of such Type B Unit.
Each Purchase Contract evidenced hereby obligates the Holder of this
Type B Unit Certificate to purchase, and the Company, to sell, on
[____________], [ ] (the "Purchase Contract Settlement Date"), at a price equal
to $[50] in cash (the "Stated Amount"), a number of Common Shares, par value
$1.00 ("Common Stock"), of the Company equal to the Settlement Rate, unless on
or prior to the Purchase Contract Settlement Date there shall have occurred a
Termination Event or an Early Settlement with respect to the Type B Unit of
which such Purchase Contract is a part, all as provided in the Purchase Contract
Agreement and more fully described on the reverse hereof. The purchase price for
the shares of Common Stock purchased pursuant to each Purchase Contract
evidenced hereby, if not paid earlier, shall be paid on the Purchase Contract
Settlement Date by application of the Proceeds from the Treasury Securities
pledged to secure the obligations under such Purchase Contract in accordance
with the terms of the Pledge Agreement.
The Company shall pay on each Payment Date in respect of each Purchase
Contract evidenced hereby an amount (the "Contract Adjustment Payments") equal
to (a) if a Reset Transaction has not occurred, [____]% per annum of the Stated
Amount or (b) following the occurrence of a Reset Transaction, the Adjusted
Contract Adjustment Payment Rate related to such Reset Transaction until any
such succeeding Reset Transaction shall occur (computed on the basis of (i) for
any full quarterly period, a 360-day year of twelve 30-day months and (ii) for
any period shorter than a full quarterly period, a 30-day month and for periods
less than a month, the actual number of days elapsed per 30-day period), as the
case may be. Such Contract Adjustment Payments shall be payable to the Person in
whose name this Type B Unit Certificate (or a Predecessor Type B Unit
Certificate) is registered at the close of business on the Record Date for such
Payment Date.
Contract Adjustment Payments will be payable at the office of the Agent
in The City of New York or, at the option of the Company, by check mailed to the
address of the Person entitled thereto as such address appears on the Type B
Units Register.
Reference is hereby made to the further provisions set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Agent by manual signature, this Type B Unit Certificate shall not be entitled to
any benefit under the Pledge Agreement or the Purchase Contract Agreement or be
valid or obligatory for any purpose.
B-2
<PAGE>
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
POLAROID CORPORATION
By: _______________________________
Name:
Title:
By: _______________________________
Name:
Title:
HOLDER SPECIFIED ABOVE (as to
obligations of such Holder under the
Purchase Contracts)
By: [___________________________],
not individually but solely as
Attorney-in-Fact of such Holder
By: _______________________________
Name:
Title:
Dated:
B-3
<PAGE>
AGENT'S CERTIFICATE OF AUTHENTICATION
This is one of the Type B Units referred to in the within-mentioned
Purchase Contract Agreement.
By: [_______________________], as Purchase
Contract Agent
By: ____________________________
Authorized Officer
B-4
<PAGE>
(REVERSE OF TYPE B UNIT CERTIFICATE)
Each Purchase Contract evidenced hereby is governed by a Purchase
Contract Agreement, dated as of [______________], 1999 (as may be supplemented
from time to time, the "Purchase Contract Agreement") between the Company and
[_____________________], as Purchase Contract Agent (including its successors
thereunder, herein called the "Agent"), to which the Purchase Contract Agreement
and supplemental agreements thereto reference is hereby made for a description
of the respective rights, limitations of rights, obligations, duties and
immunities thereunder of the Agent, the Company and the Holders and of the terms
upon which the Type B Unit Certificates are, and are to be, executed and
delivered.
Each Purchase Contract evidenced hereby obligates the Holder of this
Type B Unit Certificate to purchase, and the Company to sell, on the Purchase
Contract Settlement Date at a price equal to the Stated Amount (the "Purchase
Price") a number of shares of Common Stock of the Company equal to the
Settlement Rate, unless on or prior to the Purchase Contract Settlement Date,
there shall have occurred a Termination Event with respect to the Security of
which such Purchase Contract is a part or an Early Settlement shall have
occurred. The "Settlement Rate" is equal to (a) if the Applicable Market Value
(as defined below) is equal to or greater than $[_________] (the "Threshold
Appreciation Price"), [_________] shares of Common Stock per Purchase Contract,
(b) if the Applicable Market Value is less than the Threshold Appreciation Price
but is greater than $[_________], the number of shares of Common Stock per
Purchase Contract equal to the Stated Amount divided by the Applicable Market
Value and (c) if the Applicable Market Amount is less than or equal to
$[_________], then [_________] shares of Common Stock per Purchase Contract, in
each case subject to adjustment as provided in the Purchase Contract Agreement.
No fractional shares of Common Stock will be issued upon settlement of Purchase
Contracts, as provided in the Purchase Contract Agreement.
Each Purchase Contract evidenced hereby, which is settled either through
Early Settlement or Cash Settlement, shall obligate the Holder of the related
Type B Units to purchase at the Purchase Price for cash, and the Company to
sell, a number of newly issued shares of Common Stock equal to the Early
Settlement Rate or the Settlement Rate, as applicable.
The "Applicable Market Value" means the average of the Closing Prices
per share of Common Stock on each of the 20 Trading Days ending on the third
Trading Day immediately preceding the Purchase Contract Settlement Date. The
"Closing Price" of the Common Stock on any date of determination means the (i)
closing sale price (or, if no closing price is reported, the last reported sale
price) of the Common Stock on the New York Stock Exchange (the "NYSE") on such
date, (ii) if the Common Stock is not listed for trading on the NYSE on any such
date, the closing sale price as reported in the composite transactions for the
principal United States securities exchange on which the Common Stock is so
listed, (iii) if the Common Stock is not so listed on a United States national
or regional securities exchange, the closing sale price as reported by The
Nasdaq Stock Market, (iv) if the Common Stock is not so reported, the last
quoted bid price for the Common Stock in the over-the-counter market as reported
by the National Quotation Bureau or similar organization, or (v) if such bid
price is not available, the
B-5
<PAGE>
average of the mid-point of the last bid and ask prices of the Common Stock on
such date from at least three nationally recognized independent investment
banking firms retained for this purpose by the Company. A "Trading Day" means a
day on which the Common Stock (A) is not suspended from trading on any national
or regional securities exchange or association or over-the-counter market at the
close of business and (B) has traded at least once on the national or regional
securities exchange or association or over-the-counter market that is the
primary market for the trading of the Common Stock.
In accordance with the terms of the Purchase Contract Agreement, the
Holder of this Type B Unit shall pay the Purchase Price for the shares of Common
Stock purchased pursuant to each Purchase Contract evidenced hereby either by
effecting a Cash Settlement or an Early Settlement of each such Purchase
Contract or by applying a principal amount of the Pledged Treasury Securities
underlying such Holder's Type B Units equal to the Stated Amount of such
Purchase Contract to the purchase of the Common Stock. A Holder of Type B Units
who does not effect, on or prior to 11:00 a.m. New York City time on the
Business Day immediately preceding the Purchase Contract Settlement Date, an
effective Cash Settlement or an Early Settlement, shall pay the Purchase Price
for the shares of Common Stock to be issued under the related Purchase Contract
from the proceeds of the Pledged Treasury Securities.
The Company shall not be obligated to issue any shares of Common Stock
in respect of a Purchase Contract or deliver any certificates therefor to the
Holder unless it shall have received payment of the aggregate purchase price for
the shares of Common Stock to be purchased thereunder in the manner herein set
forth.
Each Purchase Contract evidenced hereby and all obligations and rights
of the Company and the Holder thereunder shall terminate if a Termination Event
shall occur. Upon the occurrence of a Termination Event, the Company shall give
written notice to the Agent and to the Holders, at their addresses as they
appear in the Type B Units Register. Upon and after the occurrence of a
Termination Event, the Collateral Agent shall release the Pledged Treasury
Securities (as defined in the Pledge Agreement) forming a part of each Type B
Unit. A Type B Unit shall thereafter represent the right to receive the interest
in the Treasury Security forming a part of such Type B Unit, in accordance with
the terms of the Purchase Contract Agreement and the Pledge Agreement.
The Type B Unit Certificates are issuable only in registered form and
only in denominations of a single Type B Unit and any integral multiple thereof.
The transfer of any Type B Unit Certificate will be registered and Type B Unit
Certificates may be exchanged as provided in the Purchase Contract Agreement.
The Type B Units Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents permitted by the Purchase
Contract Agreement. No service charge shall be required for any such
registration of transfer or exchange, but the Company and the Agent may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. A Holder who elects to substitute Debentures
for Treasury Securities, thereby recreating Type A Units, shall be responsible
for any fees or expenses associated therewith. Except as provided in
B-6
<PAGE>
the Purchase Contract Agreement, for so long as the Purchase Contract underlying
a Type B Unit remains in effect, such Type B Unit shall not be separable into
its constituent parts, and the rights and obligations of the Holder of such Type
B Unit in respect of the Treasury Security and the Purchase Contract
constituting such Type B Unit may be transferred and exchanged only as a Type B
Unit. A Holder of Type B Units may recreate Type A Units by delivering to the
Collateral Agent Debentures with a principal amount equal to the aggregate
principal amount at maturity of the Pledged Treasury Securities in exchange for
the release of such Pledged Treasury Securities in accordance with the terms of
the Purchase Contract Agreement and the Pledge Agreement. From and after such
substitution, the Holder's Security shall be referred to as a "Type A Unit."
Such substitution may cause the equivalent aggregate principal amount of this
Certificate to be increased or decreased; PROVIDED, HOWEVER, this Type B Unit
Certificate shall not represent more than ____ Type B Units. All such
adjustments to the equivalent aggregate principal amount of this Type B Unit
Certificate shall be duly recorded by placing an appropriate notation on the
Schedule attached hereto.
A Holder of a Type A Unit may recreate a Type B Unit by delivering to
the Collateral Agent Treasury Securities in an aggregate principal amount equal
to the aggregate principal amount at maturity of the Pledged Debentures in
exchange for the release of such Pledged Debentures in accordance with the terms
of the Purchase Contract Agreement and the Pledge Agreement. Any such recreation
of a Type B Unit may be effected only in multiples of 20 Type A Units for 20
Type B Units.
The Company shall pay, on each Payment Date, the Contract Adjustment
Payments payable in respect of each Purchase Contract to the Person in whose
name the Type B Unit Certificate evidencing such Purchase Contract is registered
at the close of business on the Record Date for such Payment Date. Contract
Adjustment Payments will be payable at the office of the Agent in The City of
New York or, at the option of the Company, by check mailed to the address of the
Person entitled thereto at such address as it appears on the Type B Units
Register.
The Purchase Contracts and all obligations and rights of the Company and
the Holders thereunder, including, without limitation, the rights of the Holders
to receive and the obligation of the Company to pay Contract Adjustment
Payments, shall immediately and automatically terminate, without the necessity
of any notice or action by any Holder, the Agent or the Company, if, on or prior
to the Purchase Contract Settlement Date, a Termination Event shall have
occurred. Upon the occurrence of a Termination Event, the Company shall promptly
but in no event later than two Business Days thereafter give written notice to
the Agent, the Collateral Agent and the Holders, at their addresses as they
appear in the Type B Units Register. Upon the occurrence of a Termination Event,
the Collateral Agent shall release the Treasury Securities from the Pledge in
accordance with the provisions of the Pledge Agreement.
Subject to and upon compliance with the provisions of the Purchase
Contract Agreement, at the option of the Holder thereof, Purchase Contracts
underlying Securities may be settled early ("Early Settlement") as provided in
the Purchase Contract Agreement. In order to exercise the right to effect Early
Settlement with respect to any Purchase Contracts evidenced by this Type B
B-7
<PAGE>
Unit the Holder of this Type B Unit Certificate shall deliver this Type B Unit
Certificate to the Agent at the Corporate Trust Office duly endorsed for
transfer to the Company or in blank with the form of Election to Settle Early
set forth below duly completed and accompanied by payment in the form of
immediately available funds payable to the order of the Company in an amount
(the "Early Settlement Amount") equal to (i) the product of (A) $50 times (B)
the number of Purchase Contracts with respect to which the Holder has elected to
effect Early Settlement, plus (ii) if such delivery is made with respect to any
Purchase Contracts during the period from the close of business on any Record
Date for any Payment Date to the opening of business on such Payment Date, an
amount equal to the Contract Adjustment Payments payable, if any, on such
Payment Date with respect to such Purchase Contracts. Upon Early Settlement of
Purchase Contracts by a Holder of the related Securities, the Pledged Treasury
Securities underlying such Securities shall be released from the Pledge as
provided in the Pledge Agreement and the Holder shall be entitled to receive a
number of shares of Common Stock on account of each Purchase Contract forming
part of a Type B Unit as to which Early Settlement is effected equal to
[_________] shares of Common Stock per Purchase Contract (the "Early Settlement
Rate"). The Early Settlement Rate shall be adjusted in the same manner and at
the same time as the Settlement Rate is adjusted as provided in the Purchase
Contract Agreement.
Upon registration of transfer of this Type B Unit Certificate, the
transferee shall be bound (without the necessity of any other action on the part
of such transferee, except as may be required by the Agent pursuant to the
Purchase Contract Agreement), under the terms of the Purchase Contract Agreement
and the Purchase Contracts evidenced hereby and the transferor shall be released
from the obligations under the Purchase Contracts evidenced by this Type B Unit
Certificate. The Company covenants and agrees, and the Holder, by its acceptance
hereof, likewise covenants and agrees, to be bound by the provisions of this
paragraph.
The Holder of this Type B Unit Certificate, by its acceptance hereof,
authorizes the Agent to enter into and perform the related Purchase Contracts
forming part of the Type B Units evidenced hereby on its behalf as its
attorney-in-fact, expressly withholds any consent to the assumption (i.e.,
affirmance) of the Purchase Contracts by the Company or its trustee in the event
that the Company becomes the subject of a case under the Bankruptcy Code, agrees
to be bound by the terms and provisions thereof, covenants and agrees to perform
its obligations under such Purchase Contracts, consents to the provisions of the
Purchase Contract Agreement, authorizes the Agent to enter into and perform the
Purchase Contract Agreement and the Pledge Agreement on its behalf as its
attorney-in-fact, and consents to the Pledge of the Treasury Securities
underlying this Type B Unit Certificate pursuant to the Pledge Agreement. The
Holder further covenants and agrees, that, to the extent and in the manner
provided in the Purchase Contract Agreement and the Pledge Agreement, but
subject to the terms thereof, payments in respect of the aggregate principal
amount of the Pledged Treasury Securities on the Purchase Contract Settlement
Date shall be paid by the Collateral Agent to the Company in satisfaction of
such Holder's obligations under such Purchase Contract and such Holder shall
acquire no right, title or interest in such payments.
B-8
<PAGE>
Subject to certain exceptions, the provisions of the Purchase Contract
Agreement may be amended with the consent of the Holders of a majority of the
Purchase Contracts.
The Purchase Contracts shall for all purposes be governed by, and
construed in accordance with, the laws of the State of New York.
The Company, the Agent and its Affiliates and any agent of the Company
or the Agent may treat the Person in whose name this Type B Unit Certificate is
registered as the owner of the Type B Units evidenced hereby for the purpose of
receiving payments of interest on the Treasury Securities, receiving payments of
Contract Adjustment Payments, performance of the Purchase Contracts and for all
other purposes whatsoever, whether or not any payments in respect thereof be
overdue and notwithstanding any notice to the contrary, and neither the Company,
the Agent nor any such agent shall be affected by notice to the contrary.
The Purchase Contracts shall not, prior to the settlement thereof,
entitle the Holder to any of the rights of a holder of shares of Common Stock.
A copy of the Purchase Contract Agreement is available for inspection at
the offices of the Agent.
B-9
<PAGE>
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
<TABLE>
<S> <C>
TEN COM - as tenants in common
UNIF GIFT MIN ACT - ---------------Custodian---------------
(cust) (minor)
Under Uniform Gifts to Minors Act of _____
__________________________________________
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and
not as tenants in common
</TABLE>
Additional abbreviations may also be used though not in the above list.
-------------------------
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s)
and transfer(s) unto __________________________________________________________
(Please insert Social Security or Taxpayer I.D. or other Identifying Number of
Assignee)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Please Print or Type Name and Address Including Postal
Zip Code of Assignee) the within Type B Unit Certificates and all rights
thereunder, hereby irrevocably constituting and appointing _______________
attorney to transfer said Type B Unit Certificates on the books of
[Name of Company] with full power of substitution in the premises.
<TABLE>
<S> <C>
Dated: ___________________ ______________________________________________
Signature
NOTICE: The signature to this assignment must
correspond with the name as it appears upon the face of
the within Type B Unit Certificates in every particular,
without alteration or enlargement or any change
whatsoever.
</TABLE>
Signature Guarantee: ___________________________________
B-10
<PAGE>
SETTLEMENT INSTRUCTIONS
The undersigned Holder directs that a certificate for shares of Common
Stock deliverable upon settlement on or after the Purchase Contract Settlement
Date of the Purchase Contracts underlying the number of Type B Units evidenced
by this Type B Unit Certificate be registered in the name of, and delivered,
together with a check in payment for any fractional share, to the undersigned at
the address indicated below unless a different name and address have been
indicated below. If shares are to be registered in the name of a Person other
than the undersigned, the undersigned will pay any transfer tax payable incident
thereto.
<TABLE>
<S> <C>
Dated: _______________________ _____________________________________
Signature
Signature Guarantee: ___________________
(if assigned to another person)
If shares are to be registered in the name of
and delivered to a Person other than the REGISTERED HOLDER
Holder, please (i) print such Person's name
and address and (ii) provide a guarantee of
your signature:
Please print name and
address of Registered
Holder:
- ------------------------------------- -------------------------------------
Name Name
- ------------------------------------- -------------------------------------
Address Address
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
Social Security or other
Taxpayer Identification _____________________________________
Number, if any
</TABLE>
B-11
<PAGE>
ELECTION TO SETTLE EARLY
The undersigned Holder of this Type B Unit Certificate irrevocably
exercises the option to effect Early Settlement in accordance with the terms of
the Purchase Contract Agreement with respect to the Purchase Contracts
underlying the number of Type B Units evidenced by this Type B Unit Certificate
specified below. The option to effect Early Settlement may be exercised only
with respect to Purchase Contracts underlying Type B Units with an aggregate
Stated Amount equal to $1,000 or an integral multiple thereof. The undersigned
Holder directs that a certificate for shares of Common Stock deliverable upon
such Early Settlement be registered in the name of, and delivered, together with
a check in payment for any fractional share and any Type B Unit Certificate
representing any Type B Units evidenced hereby as to which Early Settlement of
the related Purchase Contracts is not effected, to the undersigned at the
address indicated below unless a different name and address have been indicated
below. Pledged Treasury Securities deliverable upon such Early Settlement will
be transferred in accordance with the transfer instructions set forth below. If
shares are to be registered in the name of a Person other than the undersigned,
the undersigned will pay any transfer tax payable incident thereto.
Dated: ______________________ _____________________________________
Signature
Signature Guarantee: _____________________________________
B-12
<PAGE>
Number of Securities evidenced hereby as to which Early Settlement of
the related Purchase Contracts is being elected:
<TABLE>
<S> <C>
If shares of Common Stock of Type B Unit REGISTERED HOLDER
Certificates are to be registered in the name of
and delivered to and Pledged Treasury
Securities are to be transferred to a Person
other than the Holder, please print such
Person's name and address:
Please print name and
address of Registered
Holder:
- ------------------------------------- -------------------------------------
Name Name
- ------------------------------------- -------------------------------------
Address Address
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
- ------------------------------------- -------------------------------------
Social Security or other
Taxpayer Identification
Number, if any _____________________________________
</TABLE>
Transfer Instructions for Pledged Treasury Securities Transferable Upon Early
Settlement or a Termination Event:
B-13
<PAGE>
[TO BE ATTACHED TO GLOBAL CERTIFICATES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL CERTIFICATE
The following increases or decreases in this Global
Certificate have been made:
<TABLE>
<CAPTION>
======================= ======================= ====================== ======================= ======================
Number of UNITS
Amount of decrease in Amount of increase in evidenced by this
Number of UNITS Number of UNITS Global Certificate Signature of authorized
evidenced by the evidenced by the following such officer of Trustee or
Date Global Certificate Global Certificate decrease or increase Securities Custodian
<S> <C> <C> <C> <C>
======================= ======================= ====================== ======================= ======================
</TABLE>
B-14
<PAGE>
EXHIBIT C
INSTRUCTION TO PURCHASE CONTRACT AGENT
[------------------------------]
Attention:
Re: ________ UNITS of Polaroid Corporation (the "Company")
The undersigned Holder hereby notifies you that it has delivered to
[_________________], as Securities Intermediary, for credit to the Collateral
Account, $______ aggregate principal amount of [Debentures] [Treasury
Securities] in exchange for the [Pledged Debentures] [Pledged Treasury
Securities] held in the Collateral Account, in accordance with the Pledge
Agreement, dated as of [_________], 1999 (the "Pledge Agreement"; unless
otherwise defined herein, terms defined in the Pledge Agreement are used herein
as defined therein), between you, the Company, the Collateral Agent and the
Securities Intermediary. The undersigned Holder has paid all applicable fees
relating to such exchange. The undersigned Holder hereby instructs you to
instruct the Collateral Agent to release to you on behalf of the undersigned
Holder the [Pledged Debentures] [Pledged Treasury Securities] related to such
[Type A Units] [Type B Units].
Date: _______________________ ____________________________________
Signature
Signature Guarantee:____________________
Please print name and address of Registered Holder:
- ------------------------------------ ------------------------------------
Name Social Security or other Taxpayer
Identification Number, if any
Address
- ------------------------------------
- ------------------------------------
- ------------------------------------
C-1
<PAGE>
EXHIBIT D
NOTICE FROM PURCHASE CONTRACT AGENT
TO HOLDERS
(Transfer of Collateral upon Occurrence of a Termination Event)
[HOLDER]
=======================
Attention:
Telecopy: __________
Re: __________ UNITS of POLAROID CORPORATION
(the "Company")
Please refer to the Purchase Contract Agreement, dated as of
[_________], 1999 (the "Purchase Contract Agreement"; unless otherwise defined
herein, terms defined in the Purchase Contract Agreement are used herein as
defined therein), among the Company and the undersigned, as Purchase Contract
Agent and as attorney-in-fact for the holders of UNITS from time to time.
We hereby notify you that a Termination Event has occurred and that [the
Debentures][the Treasury Securities] underlying your ownership interest in _____
[Type A Units][Type B Units] have been released and are being held by us for
your account pending receipt of transfer instructions with respect to such
[Debentures][Treasury Securities] (the "Released Securities").
Pursuant to Section 3.15 of the Purchase Contract Agreement, we hereby
request written transfer instructions with respect to the Released Securities.
Upon receipt of your instructions and upon transfer to us of your [Type A
Units][Type B Units] effected through book-entry or by delivery to us of your
[Type A Unit Certificate][Type B Unit Certificate], we shall transfer the
Released Securities by book-entry transfer, or other appropriate procedures, in
accordance with your instructions. In the event you fail to effect such transfer
or delivery, the Released Securities and any interest thereon, shall be held in
our name, or a nominee in trust for your benefit, until such time as such [Type
A Units][Type B Units] are transferred or your [Type A Unit Certificate][Type B
Unit Certificate] is surrendered or satisfactory evidence is provided that your
[Type A Unit Certificate][Type B Unit Certificate] has been destroyed, lost or
stolen, together with any indemnification that we or the Company may require.
Date: By: [________________________________]
--------------------------------
Name:
Title:
D-1
<PAGE>
EXHIBIT E
NOTICE TO SETTLE BY SEPARATE CASH
[--------------------------]
Attention:
Re: ________ UNITS of Polaroid Corporation (the "Company")
The undersigned Holder hereby irrevocably notifies you in accordance
with Section 5.4 of the Purchase Contract Agreement, dated as of [_________],
1999 (the "Purchase Contract Agreement"; unless otherwise defined herein, terms
defined in the Purchase Contract Agreement are used herein as defined therein),
between the Company and yourselves, as Purchase Contract Agent and as
Attorney-in-Fact for the Holders of the Purchase Contracts, that such Holder has
elected to pay to the Securities Intermediary for deposit in the Collateral
Account, on or prior to 11:00 a.m. New York City time, on the [fifth Business
Day][Business Day] immediately preceding the Purchase Contract Settlement Date
(in lawful money of the United States by certified or cashiers' check or wire
transfer, in immediately available funds), $______ as the Purchase Price for the
shares of Common Stock issuable to such Holder by the Company under the related
Purchase Contract on the Purchase Contract Settlement Date. The undersigned
Holder hereby instructs you to notify promptly the Collateral Agent of the
undersigned Holder's election to make such cash settlement with respect to the
Purchase Contracts related to such Holder's [Type A Units] [Type B Units].
Date: _______________________ ____________________________________
Signature
Signature Guarantee:____________________
Please print name and address of Registered Holder:
E-1
<PAGE>
EXHIBIT F
NOTICE FROM PURCHASE CONTRACT AGENT
TO COLLATERAL AGENT AND INDENTURE TRUSTEE
(Payment of Purchase Contract Settlement Price)
[----------------------------
Attention:
Telecopy:
[----------------------------
Attention:
Telecopy:
Re: __________ UNITS of Polaroid Corporation (the "Company")
Please refer to the Purchase Contract Agreement dated as of
[__________], 1999 (the "Purchase Contract Agreement"; unless otherwise defined
herein, terms defined in the Purchase Contract Agreement are used herein as
defined therein), between the Company and the undersigned, as Purchase Contract
Agent and as attorney-in-fact for the holders of UNITS from time to time.
In accordance with Section 5.4 of the Purchase Contract Agreement and,
based on instructions and Cash Settlements received from Holders of Type A Units
as of 11:00 a.m, [DATE (FIFTH BUSINESS DAY IMMEDIATELY PRECEDING THE PURCHASE
CONTRACT SETTLEMENT DATE)], we hereby notify you that [_____ Debentures] are to
be tendered for purchase in the Remarketing.
Date: By: [_____________________________________]
--------------------------------
Name:
Title:
F-1
<PAGE>
Exhibit 4.22
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
POLAROID CORPORATION
and
-------------------------------
Debt Warrant Agent
-----------------
[SENIOR] [SUBORDINATED] DEBT WARRANT AGREEMENT*
Dated as of
----------------------
----------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
* OPTIONS REPRESENTED BY BRACKETED OR BLANK SECTIONS HEREIN
SHALL BE DETERMINED IN CONFORMITY WITH APPLICABLE PROSPECTUS
SUPPLEMENT OR SUPPLEMENTS
<PAGE>
TABLE OF CONTENTS **
<TABLE>
<CAPTION>
PAGE
<S> <C>
PARTIES...........................................................................................................1
RECITALS..........................................................................................................1
ARTICLE I ISSUANCE OF DEBT WARRANTS AND EXECUTION AND DELIVERY
OF DEBT WARRANT CERTIFICATES...........................................................................-1-
Section 1.01 Issuance of Debt Warrants................................................................-1-
Section 1.02 Form and Execution of Debt Warrant Certificates..........................................-2-
Section 1.03 Issuance and Delivery of Debt Warrant Certificates.......................................-3-
Section 1.04 Temporary Debt Warrant Certificates......................................................-3-
Section 1.05 Payment of Certain Taxes.................................................................-4-
Section 1.06 "Holder".................................................................................-4-
ARTICLE II DURATION AND EXERCISE OF DEBT WARRANTS..............................................................-4-
Section 2.01 Duration of Debt Warrants................................................................-4-
Section 2.02 Exercise of Debt Warrants................................................................-5-
ARTICLE III OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS
OF DEBT WARRANTS.......................................................................................-6-
Section 3.01 No Rights as Holder of Underlying Debt Securities Conferred by Debt
Warrants or Debt Warrant Certificates.........................................................-6-
Section 3.02 Lost, Stolen, Destroyed or Mutilated Debt Warrant Certificates...........................-6-
Section 3.03 Holder of Debt Warrants May Enforce Rights...............................................-6-
ARTICLE IV EXCHANGE AND TRANSFER OF DEBT WARRANTS..............................................................-7-
[Section 4.01 Debt Warrant Register; Exchange and Transfer of Debt Warrants...........................-7-
Section 4.02 Treatment of Holders of Debt Warrants....................................................-8-
Section 4.03 Cancellation of Debt Warrant Certificates................................................-8-
ARTICLE V CONCERNING THE DEBT WARRANT AGENT....................................................................-8-
Section 5.01 Debt Warrant Agent.......................................................................-8-
Section 5.02 Conditions of Debt Warrant Agent's Obligations...........................................-9-
Section 5.03 Resignation and Removal; Appointment of Successor.......................................-11-
Section 5.04 Compliance With Applicable Laws.........................................................-12-
Section 5.05 Office..................................................................................-13-
</TABLE>
- --------
** The Table of Contents is not part of the Debt Warrant Agreement.
-ii-
<PAGE>
<TABLE>
<S> <C>
ARTICLE VI MISCELLANEOUS......................................................................................-13-
Section 6.01 Consolidation or Merger of the Company and Conveyance or Transfer
Permitted Subject to Certain Conditions......................................................-13-
Section 6.02 Rights and Duties of Successor Corporation..............................................-13-
Section 6.03 Supplements and Amendments..............................................................-13-
Section 6.04 Notices and Demands to the Company and Debt Warrant Agent...............................-14-
Section 6.05 Addresses...............................................................................-14-
Section 6/06 Applicable Law..........................................................................-14-
Section 6.07 Delivery of Prospectus..................................................................-14-
Section 6.08 Governmental Approvals..................................................................-14-
Section 6.09 Persons Having Rights under Debt Warrant Agreement......................................-15-
Section 6.10 Headings................................................................................-15-
Section 6.11 Counterparts............................................................................-15-
Section 6.12 Inspection of Agreement.................................................................-15-
</TABLE>
-iii-
<PAGE>
THIS [SENIOR] [SUBORDINATED] DEBT WARRANT AGREEMENT, dated as of
__________, between Polaroid Corporation, a Delaware corporation (the
"Company"), and ____________________, a __________ organized and existing under
the laws of __________, as warrant agent (the "Debt Warrant Agent").
WHEREAS, the Company and _____________________ has entered into an
Indenture dated as of January 9, 1997 (the "Indenture") with State Street Bank
and Trust Company, as trustee (the "Trustee"), providing for the issuance by the
Company from time to time, in one or more series, of debt securities evidencing
its unsecured, ________________ indebtedness (such debt securities, being
referred to as the "Securities"); and
WHEREAS, the Company proposes to issue warrants (the "Debt Warrants")
representing the right to purchase Debt Securities of one or more series (the
"Underlying Debt Securities"); and
WHEREAS, the Company has duly authorized the execution and delivery of
this Debt Warrant Agreement to provide for the issuance of Debt Warrants to be
exercisable at such times and for such prices, and to have such other
provisions, as shall be fixed as hereinafter provided;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, the parties hereto agree as follows:
ARTICLE I
ISSUANCE OF DEBT WARRANTS AND EXECUTION AND DELIVERY
OF DEBT WARRANT CERTIFICATES
Section 1.01. ISSUANCE OF DEBT WARRANTS. Debt Warrants may be issued
from time to time, together with or separately from any Securities (the "Offered
Debt Securities"). Prior to the issuance of any Debt Warrants, there shall be
established by or pursuant to a resolution or resolutions duly adopted by the
Company's Board of Directors or by any committee thereof duly authorized to act
with respect thereto (a "Board Resolution"):
a) the title and aggregate number of such Debt Warrants;
b) the offering price of such Debt Warrants, if any;
c) whether such Debt Warrants are to be issued with any
Offered Debt Securities and, if so, the title, aggregate principal amount and
terms of any such Offered Debt Securities; the number of Debt Warrants to be
issued with each $1,000 principal amount of such Offered Debt Securities (or
such other principal amount of such Offered Debt Securities as is provided for
in the Board Resolution); and the date, if any, on and after which such Debt
Warrants and such Offered Debt Securities will be separately transferable (the
"Detachable Date");
-1-
<PAGE>
d) the title, aggregate principal amount, ranking and terms
(including the subordination and conversion provisions) of the Underlying Debt
Securities that may be purchased upon exercise of such Debt Warrants;
e) the time or times at which, or period or periods during
which, such Debt Warrants may be exercised, the minimum or maximum amount of
Debt Warrants which may be exercised at any one time and the final date on which
such Debt Warrants may be exercised (the "Expiration Date");
f) the principal amount of Underlying Debt Securities that may
be purchased upon exercise of each Debt Warrant and the price, or the manner of
determining the price (the "Debt Warrant Price"), at which such principal amount
may be purchased upon such exercise;
g) the terms of any right to redeem or call such Debt
Warrants; and
h) any other terms of such Debt Warrants not inconsistent with
the provisions of this Agreement.
Section 1.02 FORM AND EXECUTION OF DEBT WARRANT CERTIFICATES.
a) The Debt Warrants shall be evidenced by warrant
certificates (the "Debt Warrant Certificates"), which may be in registered or
bearer form and otherwise shall be substantially in such form or forms as shall
be established by or pursuant to a Board Resolution. Each Debt Warrant
Certificate, whenever issued, shall be dated the date it is countersigned by the
Debt Warrant Agent and may have such letters, numbers or other identifying marks
and such legends or endorsements printed, lithographed or engraved thereon as
are not inconsistent with the provisions of this Agreement, or as may be
required to comply with any applicable law, rule or regulation or with any rule
or regulation of any securities exchange on which the Debt Warrants may be
listed, or to conform to usage, as the officer of the Company executing the same
may approve (such officer's execution thereof to be conclusive evidence of such
approval). Each Debt Warrant Certificate shall evidence one or more Debt
Warrants.
b) The Debt Warrant Certificates shall be signed in the name
and on behalf of the Company by its Chairman of the Board of Directors, its
President, an Executive Vice President, any Vice President, the Treasurer or any
Assistant Treasurer and by its Secretary or any Assistant Secretary. Such
signatures may be manual or facsimile signatures of the present or any future
holder of any such office and may be imprinted or otherwise reproduced on the
Debt Warrant Certificates. The seal of the Company may be in the form of a
facsimile thereof and may be impressed, affixed, imprinted or otherwise
reproduced on the Debt Warrant Certificates.
c) No Debt Warrant Certificate shall be valid for any purpose,
and no Debt Warrant evidenced thereby shall be deemed issued or exercisable,
until such Debt Warrant Certificate has been countersigned by the manual or
facsimile signature of the Debt Warrant
-2-
<PAGE>
Agent. Such signature by the Debt Warrant Agent upon any Debt Warrant
Certificate executed by the Company shall be conclusive evidence that the Debt
Warrant Certificate so countersigned has been duly issued hereunder.
d) In case any officer of the Company who shall have signed
any Debt Warrant Certificate either manually or by facsimile signature shall
cease to be such officer before the Debt Warrant Certificate so signed shall
have been countersigned and delivered by the Debt Warrant Agent, such Debt
Warrant Certificate nevertheless may be countersigned and delivered as though
the person who signed such Debt Warrant Certificate had not ceased to be such
officer of the Company; and any Debt Warrant Certificate may be signed on behalf
of the Company by such person as, at the actual date of the execution of such
Debt Warrant Certificate, shall be the proper officer of the Company, although
at the date of the execution of this Agreement such person was not such an
officer.
Section 1.03 ISSUANCE AND DELIVERY OF DEBT WARRANT CERTIFICATES. At any
time and from time to time after the execution and delivery of this Agreement,
the Company may deliver Debt Warrant Certificates executed by the Company to the
Debt Warrant Agent for countersignature. Except as provided in the following
sentence, the Debt Warrant Agent shall thereupon and deliver such Debt Warrant
Certificates to or upon the written request of the Company. Subsequent to the
original issuance of a Debt Warrant Certificate evidencing Debt Warrants, the
Debt Warrant Agent shall countersign a new Debt Warrant Certificate evidencing
such Debt Warrants only if such Debt Warrant Certificate is issued in exchange
or substitution for one or more previously countersigned Debt Warrant
Certificates evidencing such Debt Warrants or in connection with their transfer,
as hereinafter provided.
Section 1.04 TEMPORARY DEBT WARRANT CERTIFICATES. Pending the
preparation of definitive Debt Warrant Certificates, the Company may execute,
and upon the order of the Company the Debt Warrant Agent shall countersign and
deliver, temporary Debt Warrant Certificates that are printed, lithographed,
typewritten, mimeographed or otherwise produced, substantially of the tenor of
the definitive Debt Warrant Certificates in lieu of which they are issued and
with such appropriate insertions, omissions, substitutions and other variations
as the officer executing such Debt Warrant Certificates may determine, as
evidenced by such officer's execution of such Debt Warrant Certificates.
If temporary Debt Warrant Certificates are issued, the Company
will cause definitive Debt Warrant Certificates to be prepared without
unreasonable delay. After the preparation of definitive Debt Warrant
Certificates, the temporary Debt Warrant Certificates shall be exchangeable for
definitive Debt Warrant Certificates upon surrender of the temporary Debt
Warrant Certificates at the corporate trust office of the Debt Warrant Agent or
__________, without charge to the Holder, as defined in Section 1.06 hereof.
Upon surrender for cancellation of any one or more temporary Debt Warrant
Certificates, the Company shall execute and the Debt Warrant Agent shall
countersign and deliver in exchange therefor definitive Debt Warrant
Certificates representing the same aggregate number of Debt Warrants. Until so
exchanged, the
-3-
<PAGE>
temporary Debt Warrant Certificates shall in all respects be entitled to the
same benefits under this Agreement as definitive Debt Warrant Certificates.
Section 1.05 PAYMENT OF CERTAIN TAXES. The Company will pay all stamp
and other duties, if any, to which this Agreement or the original issuance of
the Debt Warrants or Debt Warrant Certificates may be subject under the laws of
the United States of America or any state or locality.
Section 1.06 "HOLDER". The term "Holder" or "Holders", as used herein
with reference to a Debt Warrant Certificate, shall mean [if registered Debt
Warrants the person or persons in whose name such Debt Warrant Certificate shall
then be registered as set forth in the Debt Warrant Register to be maintained by
the Debt Warrant Agent pursuant to Section 4.01 for that purpose] [if bearer
Debt Warrants - the bearer of such Debt Warrant Certificate] or, in the case of
Debt Warrants that are issued with Offered Debt Securities and cannot then be
transferred separately therefrom, [if registered Offered Debt Securities and
Debt Warrants that are not then detachable - the person or persons in whose name
the related Offered Debt Securities shall be registered as set forth in the
security register to be maintained by the Trustee for such Offered Debt
Securities pursuant to the Indenture] [if bearer Offered Debt Securities and
Debt Warrants that are not then detachable - the bearer of the related Offered
Debt Security], prior to the Detachable Date. [If registered Offered Debt
Securities and Debt Warrants that are not then detachable - The Company will, or
will cause the security registrar of any such Offered Debt Securities to, make
available to the Debt Warrant Agent at all times (including on and after the
Detachable Date, in the case of Debt Warrants originally issued with Offered
Debt Securities and not subsequently transferred separately therefrom) such
information as to holders of Offered Debt Securities with Debt Warrants as may
be necessary to keep the Warrant Register up to date.]
ARTICLE II
DURATION AND EXERCISE OF DEBT WARRANTS
Section 2.01 DURATION OF DEBT WARRANTS. Each Debt Warrant may be
exercised at the time or times, or during the period or periods, provided by or
pursuant to the Board Resolution relating thereto and specified in the Debt
Warrant Certificate evidencing such Debt Warrant. Each Debt Warrant not
exercised at or before 5:00 P.M., New York City time, on its Expiration Date
shall become void, and all rights of the Holder of such Debt Warrant thereunder
and under this Agreement shall cease, provided that the Company reserves the
right to, and may, in its sole discretion, at any time and from time to time, at
such time or times as the Company so determines, extend the Expiration Date of
the Warrants for such periods of time as it chooses. Whenever the Expiration
Date of the Debt Warrants is so extended, the Company shall at least [20] days
prior to the then Expiration Date cause to be mailed to the Debt Warrant Agent
and the registered Holders of the Debt Warrants in accordance with the
provisions of Section 6.04 hereof a notice stating that the Expiration Date has
been extended and setting forth the new Expiration Date.
-4-
<PAGE>
Section 2.02 EXERCISE OF DEBT WARRANTS. a) The Holder of a Debt Warrant
shall have the right, at its option, to exercise such Debt Warrant and, subject
to subsection (f) of this Section 2.02, purchase the principal amount of
Underlying Debt Securities provided for therein at the time or times or during
the period or periods referred to in Section 2.01 and specified in the Debt
Warrant Certificate evidencing such Debt Warrant. Except as may be provided in a
Debt Warrant Certificate, a Debt Warrant may be exercised by completing the form
of election to purchase set forth on the reverse side of the Debt Warrant
Certificate, by duly executing and delivering the same, together with payment in
full of the Debt Warrant Price in lawful money of the United States of America,
in cash or by certified or official bank check or by bank wire transfer, to the
Debt Warrant Agent. Except as may be provided in a Debt Warrant Certificate, the
date on which such Debt Warrant Certificate and payment are received by the Debt
Warrant Agent as aforesaid shall be deemed to be the date on which the Debt
Warrant is exercised and the Underlying Debt Securities are issued.
b) Upon the exercise of a Debt Warrant, the Company shall
issue, pursuant to the Indenture, in authorized denominations to or upon the
order of the Holder of such Debt Warrant, the Underlying Debt Securities to
which such Holder is entitled, in the form required under such Indenture,
registered, in the case of Underlying Debt Securities in registered form, in
such name or names as may be directed by such Holder.
c) If fewer than all of the Debt Warrants evidenced by a Debt
Warrant Certificate are exercised, the Company shall execute, and an authorized
officer of the Debt Warrant Agent shall countersign and deliver, a new Debt
Warrant Certificate evidencing the number of Debt Warrants remaining
unexercised.
d) The Debt Warrant Agent shall deposit all funds received by
it in payment of the Debt Warrant Price in the account of the Company maintained
with it for such purpose and shall advise the Company by telephone by 5:00 P.M.,
New York City time, of each day on which a payment of the Debt Warrant Price for
Debt Warrants is received of the amount so deposited in its account. The Debt
Warrant Agent shall promptly confirm such telephone advice in writing to the
Company.
e) The Debt Warrant Agent shall, from time to time, as
promptly as practicable, advise the Company and the Trustee of (i) the number of
Debt Warrants of each title exercised as provided herein, (ii) the instructions
of each Holder with respect to delivery of the Underlying Debt Securities to
which such Holder is entitled upon such exercise, (iii) the delivery of Debt
Warrant Certificates evidencing the balance, if any, of the Debt Warrants
remaining unexercised after such exercise, and (iv) such other information as
the Company or the Trustee shall reasonably require. Such notice may be given by
telephone to be promptly confirmed in writing.
f) The Holder, and not the Company, shall be required to pay
any stamp or other tax or other governmental charge that may be imposed in
connection with any transfer involved in the issuance of the Underlying Debt
Securities; and in the event that any such transfer is
-5-
<PAGE>
involved, the Company shall not be required to issue any Underlying Debt
Securities (and the Holder's purchase of the Underlying Debt Securities upon the
exercise of such Holder's Debt Warrant shall not be deemed to have been
consummated) until such tax or other charge shall have been paid or it has been
established to the Company's satisfaction that no such tax or other charge is
due.
ARTICLE III
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS
OF DEBT WARRANTS
Section 3.01 NO RIGHTS AS HOLDER OF UNDERLYING DEBT SECURITIES
CONFERRED BY DEBT WARRANTS OR DEBT WARRANT CERTIFICATES. No Debt Warrant or Debt
Warrant Certificate shall entitle the Holder to any of the rights of a holder of
Underlying Debt Securities, including, without limitation, the right to receive
the payment of principal of (or premium, if any, on) or interest, if any, on
Underlying Debt Securities or to enforce any of the covenants in the Indenture.
Section 3.02 LOST, STOLEN, DESTROYED OR MUTILATED DEBT WARRANT
CERTIFICATES. Upon receipt by the Company and the Debt Warrant Agent of evidence
reasonably satisfactory to them of the ownership of and the loss, theft,
destruction or mutilation of any Debt Warrant Certificate and of indemnity
(other than in connection with any mutilated Debt Warrant Certificates
surrendered to the Debt Warrant Agent for cancellation) reasonably satisfactory
to them, the Company shall execute, and the Debt Warrant Agent shall countersign
and deliver, in exchange for or in lieu of each lost, stolen, destroyed or
mutilated Debt Warrant Certificate, a new Debt Warrant Certificate evidencing a
like number of Debt Warrants of the same title. Upon the issuance of a new Debt
Warrant Certificate under this Section, the Company may require the payment of a
sum sufficient to cover any stamp or other tax or other governmental charge that
may be imposed in connection therewith and any other expenses (including the
fees and expenses of the Debt Warrant Agent) in connection therewith. Every
substitute Debt Warrant Certificate executed and delivered pursuant to this
Section in lieu of any lost, stolen or destroyed Debt Warrant Certificate shall
represent a contractual obligation of the Company, whether or not such lost,
stolen or destroyed Debt Warrant Certificate shall be at any time enforceable by
anyone, and shall be entitled to the benefits of this Agreement equally and
proportionately with any and all other Debt Warrant Certificates, duly executed
and delivered hereunder, evidencing Debt Warrants of the same title. The
provisions of this Section are exclusive and shall preclude (to the extent
lawful) all other rights and remedies with respect to the replacement of lost,
stolen, destroyed or mutilated Debt Warrant Certificates.
Section 3.03 HOLDER OF DEBT WARRANTS MAY ENFORCE RIGHTS.
Notwithstanding any of the provisions of this Agreement, a Holder, without the
consent of the Debt Warrant Agent, the Trustee, the holder of any Underlying
Debt Securities or the Holder of any other Debt Warrant, may, on its own behalf
and for its own benefit, enforce, and may institute and maintain any suit,
action or proceeding against the Company to enforce, or otherwise in respect of,
its right to
-6-
<PAGE>
exercise its Debt Warrant or Debt Warrants in the manner provided in this
Agreement and its Debt Warrant Certificate.
ARTICLE IV
EXCHANGE AND TRANSFER OF DEBT WARRANTS
[Section 4.01 DEBT WARRANT REGISTER; EXCHANGE AND TRANSFER OF DEBT
WARRANTS. If registered Debt Warrants - The Debt Warrant Agent shall maintain,
at its corporate trust office [or at __________], a register (the " Debt Warrant
Register") in which, upon the issuance of Debt Warrants, or on and after the
Detachable Date in the case of Debt Warrants not separately transferable prior
thereto, and, subject to such reasonable regulations as the Debt Warrant Agent
may prescribe, it shall register Debt Warrant Certificates and exchanges and
transfers thereof. The Debt Warrant Register shall be in written form or in any
other form capable of being converted into written form within a reasonable
time.]
Except as provided in the following sentence, upon surrender at the
corporate trust office of the Debt Warrant Agent [or at __________] Debt Warrant
Certificates may be exchanged for one or more other Debt Warrant Certificates
evidencing the same aggregate number of Debt Warrants of the same title, or may
be transferred in whole or in part. A Debt Warrant Certificate evidencing Debt
Warrants that are not then transferable separately from the Offered Debt
Security with which they were issued may be exchanged or transferred prior to
its Detachable Date only together with such Offered Debt Security and only for
the purpose of effecting, or in conjunction with, an exchange or transfer of
such Offered Debt Security; and on or prior to the Detachable Date, [if
registered Offered Debt Securities and Debt Warrants - each exchange or transfer
of such Offered Debt Security on the security register of the Offered Debt
Securities shall operate also to exchange or transfer the related Debt Warrant]
[if bearer Offered Debt Securities and Debt Warrants - an exchange or transfer
of possession of the related Offered Debt Security shall operate also to
exchange or transfer the related Debt Warrants]. [If registered Debt Warrants -
A transfer shall be registered upon surrender of a Debt Warrant Certificate to
the Debt Warrant Agent at its corporate trust office [or at __________] for
transfer, properly endorsed or accompanied by appropriate instruments of
transfer and written instructions for transfer, all in form satisfactory to the
Company and the Debt Warrant Agent duly signed by the registered holder or
holders thereof or by the duly appointed legal representative thereof or by a
duly authorized attorney, such signature to be guaranteed by (a) a bank or trust
company, (b) a broker or dealer that is a member of the National Association of
Securities Dealers, Inc. (the "NASD") or (c) a member of a national securities
exchange. Upon any such registration of transfer, a new Debt Warrant Certificate
shall be issued to the transferee.] Whenever a Debt Warrant Certificate is
surrendered for exchange or transfer, the Debt Warrant Agent shall countersign
and deliver to the person or persons entitled thereto one or more Debt Warrant
Certificates duly executed by the Company, as so requested. The Debt Warrant
Agent shall not be required to effect any exchange or transfer which will result
in the issuance of a Debt Warrant Certificate evidencing a fraction of a Debt
Warrant. All Debt Warrant Certificates issued upon any exchange or transfer of a
Debt Warrant Certificate shall be the valid obligations of the Company,
evidencing the same
-7-
<PAGE>
obligations, and entitled to the same benefits under this Agreement, as the Debt
Warrant Certificate surrendered for such exchange or transfer.
No service charge shall be made for any exchange or transfer
of Debt Warrants, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any such exchange or transfer, in accordance with Section 2.02(f) hereof.
Section 4.02 TREATMENT OF HOLDERS OF DEBT WARRANTS. Every Holder of a
Debt Warrant, by accepting the Debt Warrant Certificate evidencing the same,
consents and agrees with the Company, the Debt Warrant Agent and with every
other Holder of Debt Warrants of the same title that the Company and the Debt
Warrant Agent may treat the Holder of a Debt Warrant Certificate (or, if the
Debt Warrant Certificate is not then detachable, the Holder of the related
Offered Debt Security) as the absolute owner of such Debt Warrant for all
purposes and as the person entitled to exercise the rights represented by such
Debt Warrant, any notice to the contrary notwithstanding.
Section 4.03 CANCELLATION OF DEBT WARRANT CERTIFICATES. In the event
that the Company shall purchase, redeem or otherwise acquire any Debt Warrants
after the issuance thereof, the Debt Warrant Certificate or Certificates
evidencing such Debt Warrants shall thereupon be delivered to the Debt Warrant
Agent and be cancelled by it. The Debt Warrant Agent shall also cancel any Debt
Warrant Certificate (including any mutilated Debt Warrant Certificate) delivered
to it for exercise, in whole or in part, or for exchange [or transfer] [if Debt
Warrant Certificates are issued in bearer form - , except that Debt Warrant
Certificates delivered to the Debt Warrant Agent in exchange for Debt Warrant
Certificates of other denominations may be retained by the Debt Warrant Agent
for reissue]. Debt Warrant Certificates so cancelled shall be delivered by the
Debt Warrant Agent to the Company from time to time, or disposed of in
accordance with the instructions of the Company.
ARTICLE V
CONCERNING THE DEBT WARRANT AGENT
Section 5.01 DEBT WARRANT AGENT. The Company hereby appoints
___________________ as Debt Warrant Agent of the Company in respect of the Debt
Warrants and the Debt Warrant Certificates upon the terms and subject to the
conditions set forth herein; and _______________ hereby accepts such
appointment. The Debt Warrant Agent shall have the powers and authority granted
to and conferred upon it in the Debt Warrant Certificates and hereby and such
further powers and authority acceptable to it to act on behalf of the Company as
the Company may hereafter grant to or confer upon it. All of the terms and
provisions with respect to such powers and authority contained in any Debt
Warrant Certificate are subject to and governed by the terms and provisions
hereof.
-8-
<PAGE>
Section 5.02 CONDITIONS OF DEBT WARRANT AGENT'S OBLIGATIONS. The Debt
Warrant Agent accepts its obligations set forth herein upon the terms and
conditions hereof, including the following, to all of which the Company agrees
and to all of which the rights hereunder of the Holders shall be subject:
a) COMPENSATION AND INDEMNIFICATION. The Company agrees to
promptly pay the Debt Warrant Agent the compensation [set forth in
Exhibit A hereto] and to reimburse the Debt Warrant Agent for
reasonable out-of-pocket expenses (including counsel fees) incurred by
the Debt Warrant Agent in connection with the services rendered
hereunder by the Debt Warrant Agent. The Company also agrees to
indemnify the Debt Warrant Agent for, and to hold it harmless against,
any loss, liability or expense (including the reasonable costs and
expenses of defending against any claim of liability) incurred without
negligence or bad faith on the part of the Debt Warrant Agent arising
out of or in connection with its appointment, status or service as Debt
Warrant Agent hereunder.
b) AGENT FOR THE COMPANY. In acting under this Agreement and
in connection with any Debt Warrant Certificate, the Debt Warrant Agent
is acting solely as agent of the Company and does not assume any
obligation or relationship of agency or trust for or with any Holder.
c) COUNSEL. The Debt Warrant Agent may consult with counsel
satisfactory to it, and the advice of such counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in accordance
with the advice of such counsel.
d) DOCUMENTS. The Debt Warrant Agent shall be protected and
shall incur no liability for or in respect of any action taken,
suffered or omitted by it in reliance upon any notice, direction,
consent, certificate, affidavit, statement or other paper or document
reasonably believed by it to be genuine and to have been presented or
signed by the proper parties.
e) OFFICER'S CERTIFICATE. Whenever in the performance of its
duties hereunder the Debt Warrant Agent shall reasonably deem it
necessary that any fact or matter be proved or established by the
Company prior to taking, suffering or omitting any action hereunder,
the Debt Warrant Agent may (unless other evidence in respect thereof be
herein specifically prescribed), in the absence of bad faith on its
part, rely upon a certificate signed by the Chairman of the Board of
Directors, the Vice Chairman of the Board of Directors, the President,
an Executive Vice President, and by the Treasurer, an Assistant
Treasurer, the Secretary or an Assistant Secretary of the Company (an
"Officer's Certificate") delivered by the Company to the Debt Warrant
Agent.
f) ACTIONS THROUGH AGENTS. The Debt Warrant Agent may execute
and exercise any of the rights or powers hereby vested in it or perform
any duty hereunder either itself
-9-
<PAGE>
or by or through its attorneys or agents, and the Debt Warrant Agent
shall not be answerable or accountable for any act, default, neglect or
misconduct of any such attorney or agent or for any loss to the Company
resulting from such neglect or misconduct; provided, however, that
reasonable care shall have been exercised in the selection and
continued employment of such attorneys and agents.
g) CERTAIN TRANSACTIONS. The Debt Warrant Agent, and any
officer, director or employee thereof, may become the owner of, or
acquire any interest in, any Debt Warrant, with the same rights that
he, she or it would have if it were not the Debt Warrant Agent, and, to
the extent permitted by applicable law, he, she or it may engage or be
interested in any financial or other transaction with the Company and
may serve on, or as depository, trustee or agent for, any committee or
body of holders of Underlying Debt Securities or other obligations of
the Company as if it were not the Debt Warrant Agent. Nothing in this
Agreement shall be deemed to prevent the Debt Warrant Agent from acting
as Trustee under the Indenture.
h) NO LIABILITY FOR INTEREST. The Debt Warrant Agent shall not
be liable for interest on any monies at any time received by it
pursuant to any of the provisions of this Agreement or of the Debt
Warrant Certificates, except as otherwise agreed with the Company.
i) NO LIABILITY FOR INVALIDITY. The Debt Warrant Agent shall
incur no liability with respect to the validity of this Agreement
(except as to the due execution hereof by the Debt Warrant Agent) or
any Debt Warrant Certificate (except as to the countersignature thereof
by the Debt Warrant Agent).
j) NO RESPONSIBILITY FOR COMPANY REPRESENTATIONS. The Debt
Warrant Agent shall not be responsible for any of the recitals or
representations contained herein (except as to such statements or
recitals as describe the Debt Warrant Agent or action taken or to be
taken by it) or in any Debt Warrant Certificate (except as to the Debt
Warrant Agent's countersignature on such Debt Warrant Certificate), all
of which recitals and representations are made solely by the Company.
k) NO IMPLIED OBLIGATIONS. The Debt Warrant Agent shall be
obligated to perform only such duties as are specifically set forth
herein, and no other duties or obligations shall be implied. The Debt
Warrant Agent shall not be under any obligation to take any action
hereunder that may subject it to any expense or liability, the payment
of which within a reasonable time is not, in its reasonable opinion,
assured to it. The Debt Warrant Agent shall not be accountable or under
any duty or responsibility for the use by the Company of any Debt
Warrant Certificate countersigned by the Debt Warrant Agent and
delivered by it to the Company pursuant to this Agreement or for the
application by the Company of the proceeds of the issuance or exercise
of Debt Warrants. The Debt Warrant Agent shall have no duty or
responsibility in case of any default by the Company
-10-
<PAGE>
in the performance of its covenants or agreements contained herein or
in any Debt Warrant Certificate or in case of the receipt of any
written demand from a Holder with respect to such default, including,
without limiting the generality of the foregoing, any duty or
responsibility to initiate or attempt to initiate any proceedings at
law or otherwise or, except as provided in Section 6.04 hereof, to make
any demand upon the Company.
Section 5.03 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR. a) The
Company agrees, for the benefit of the Holders of the Debt Warrants, that there
shall at all times be a Debt Warrant Agent hereunder until all the Debt Warrants
are no longer exercisable.
b) The Debt Warrant Agent may at any time resign as such by
giving written notice to the Company, specifying the date on which such
resignation shall become effective; provided that such date shall not be less
than [90] days after the date on which such notice is given, unless the Company
agrees to accept a shorter notice. Such resignation is subject to the
appointment and acceptance of a successor Debt Warrant Agent, as hereinafter
provided. The Debt Warrant Agent hereunder may be removed at any time by the
filing with it of an instrument in writing signed by or on behalf of the Company
and specifying such removal and the date when it shall become effective.
Notwithstanding the provisions of this Section 5.03(b), such resignation or
removal shall take effect only upon the appointment by the Company, as
hereinafter provided, of a successor Debt Warrant Agent (which shall be a bank
or trust company organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia, authorized
under the laws of such jurisdiction to exercise corporate trust powers and
having at the time of its appointment as Debt Warrant Agent a combined capital
and surplus (as set forth in its most recent published report of financial
condition) of at least [$50,000,000]) and the acceptance of such appointment by
such successor Debt Warrant Agent. In the event a successor Debt Warrant Agent
has not been appointed and has not accepted its duties within [90] days of the
Debt Warrant Agent's notice of resignation, the Debt Warrant Agent may apply to
any court of competent jurisdiction for the designation of a successor Debt
Warrant Agent. The obligations of the Company under Section 5.02(a) shall
continue to the extent set forth therein notwithstanding the resignation or
removal of the Debt Warrant Agent.
c) In case at any time the Debt Warrant Agent shall resign, or
shall be removed, or shall become incapable of acting, or shall be adjudged a
bankrupt or insolvent, or shall file a petition seeking relief under Title 11 of
the United States Code, as now constituted or hereafter amended, or under any
other applicable federal or state bankruptcy law or similar law, or make an
assignment for the benefit of its creditors, or consent to the appointment of a
receiver or custodian for all or any substantial part of its property, or shall
admit in writing its inability to pay or meet its debts as they mature, or if a
receiver or custodian for it or for all or any substantial part of its property
shall be appointed, or if an order of any court shall be entered for relief
against it under the provisions of Title 11 of the United States Code, as now
constituted or hereafter amended, or under any other applicable federal or state
bankruptcy or similar law, or if any public officer shall have taken charge or
control of the Debt Warrant
-11-
<PAGE>
Agent or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation, a successor Debt Warrant Agent, qualified as
aforesaid, shall be appointed by the Company by an instrument in writing, filed
with the successor Debt Warrant Agent. Upon the appointment as aforesaid of a
successor Debt Warrant Agent and acceptance by the successor Debt Warrant Agent
of such appointment, the Debt Warrant Agent so superseded shall cease to be Debt
Warrant Agent hereunder.
d) Any successor Debt Warrant Agent appointed hereunder shall
execute, acknowledge and deliver to its predecessor and to the Company an
instrument accepting such appointment hereunder, and thereupon such successor
Debt Warrant Agent, without any further act, deed or conveyance, shall become
vested with all the authority, rights, powers, trusts, immunities, duties and
obligations of such predecessor with like effect as if originally named as Debt
Warrant Agent hereunder, and such predecessor, upon payment of its charges and
disbursements then unpaid, shall thereupon become obligated to transfer, deliver
and pay over, and such successor Debt Warrant Agent shall be entitled to
receive, [the Debt Warrant Register and] all monies, securities and other
property on deposit with or held by such predecessor (together with any books
and records relating thereto), as Debt Warrant Agent hereunder.
e) The Company shall cause notice of the appointment of any
successor Debt Warrant Agent to be [if registered Debt Warrants - mailed by
first-class mail, postage prepaid, to each Holder at its address appearing on
the Debt Warrant Register or, in the case of Debt Warrants that are issued with
Offered Debt Securities and cannot then be transferred separately therefrom, on
the security register for the Offered Debt Securities] [if bearer Debt Warrants
published in an Authorized Newspaper (as defined in Section 101 of the
Indenture) in The City of New York and in such other city or cities as may be
specified by the Company at least twice, [the first such publication to be not
earlier than the earliest date and not later than the latest date prescribed for
the giving such notice]. Such notice shall set forth the name and address of the
successor Debt Warrant Agent. Failure to give any notice provided for in this
Section 5.03(e), or any defect therein, shall not, however, affect the legality
or validity of the appointment of the successor Debt Warrant Agent.
f) Any corporation into which the Debt Warrant Agent hereunder
may be merged or converted, or any corporation with which the Debt Warrant Agent
may be consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Debt Warrant Agent shall be a party, or any
corporation to which the Debt Warrant Agent shall sell or otherwise transfer all
or substantially all of its assets and business, provided that such Corporation
shall be qualified as aforesaid, shall be the successor Debt Warrant Agent under
this Agreement without the execution or filing of any paper, the giving of any
notice to Holders or any further act on the part of the parties hereto.
Section 5.04 COMPLIANCE WITH APPLICABLE LAWS. The Debt Warrant Agent
agrees to comply with all applicable federal and state laws imposing obligations
on it in respect of the services rendered by it under this Debt Warrant
Agreement and in connection with the Debt Warrants, including (but not limited
to) the provisions of United States federal income tax laws regarding
information reporting and backup withholding. The Debt Warrant Agent expressly
-12-
<PAGE>
assumes all liability for its failure to comply with any such laws imposing
obligations on it, including (but not limited to) any liability for failure to
comply with any applicable provisions of United States federal income tax laws
regarding information reporting and backup withholding.
Section 5.05 OFFICE. The Company will maintain an office or agency
where Debt Warrant Certificates may be presented for exchange, transfer or
exercise. The office initially designated for this purpose shall be the
corporate trust office of the Debt Warrant Agent at
_____________.
ARTICLE VI
MISCELLANEOUS
Section 6.01 CONSOLIDATION OR MERGER OF THE COMPANY AND CONVEYANCE OR
TRANSFER PERMITTED SUBJECT TO CERTAIN CONDITIONS. To the extent permitted in the
Indenture, the Company may consolidate with or merge into another corporation or
other entity, or convey or transfer all or substantially all of its properties
and assets to any other corporation or other entity.
Section 6.02 RIGHTS AND DUTIES OF SUCCESSOR CORPORATION. In case of any
such consolidation, merger, conveyance or transfer and upon any assumption of
the duties and obligations of the Company by the successor corporation, such
successor corporation shall succeed to and be substituted for the Company, with
the same effect as if it had been named herein, and the Company shall be
relieved of any further obligation under this Agreement and the Debt Warrants.
Such successor corporation thereupon may cause to be signed, and may issue
either in its own name or in the name of the Company, any or all of the
Underlying Debt Securities issuable pursuant to the terms hereof. All the
Underlying Debt Securities so issued shall in all respects have the same legal
rank and benefit under the Indenture as the Underlying Debt Securities
theretofore or thereafter issued in accordance with the terms of this Agreement
and the Indenture.
In case of any such consolidation, merger, conveyance or
transfer, such changes in phraseology and form (but not in substance) may be
made in the Underlying Debt Securities thereafter to be issued as may be
appropriate.
Section 6.03 SUPPLEMENTS AND AMENDMENTS. a) The Company and the Debt
Warrant Agent may from time to time supplement or amend this Agreement without
the approval or consent of any Holder in order to cure any ambiguity, to correct
or supplement any provision contained herein that may be defective or
inconsistent with any other provision herein, or to make any other provision in
regard to matters or questions arising hereunder that the Company and the Debt
Warrant Agent may deem necessary or desirable and that shall not adversely
affect the interests of the Holders. Every Holder of Debt Warrants, whether
issued before or after any such supplement or amendment, shall be bound thereby.
Promptly after the effectiveness of any supplement or amendment that affects the
interests of the Holders, the Company shall give notice
-13-
<PAGE>
thereof, as provided in Section 5.03(d) hereof, to the Holders affected thereby,
setting forth in general terms the substance of such supplement or amendment.
b) The Company and the Debt Warrant Agent may modify or amend
this Agreement and the Debt Warrant Certificates with the consent of the Holders
of not fewer than a majority in principal amount of the underlying Debt
Securities represented by the Debt Warrants affected by such modification or
amendment, for any purpose; provided, however, that no such modification or
amendment that shortens the period of time during which the Debt Warrants may be
exercised, or otherwise materially and adversely affects the exercise rights of
the Holders or reduces the percentage of Holders of outstanding Debt Warrants
the consent of which is required for modification or amendment of this Agreement
or the Debt Warrants, may be made without the consent of each Holder affected
thereby.
Section 6.04 NOTICES AND DEMANDS TO THE COMPANY AND DEBT WARRANT AGENT.
If the Debt Warrant Agent shall receive any notice or demand addressed to the
Company by a Holder pursuant to the provisions of this Agreement or a Debt
Warrant Certificate (other than notices relating to the exchange[, transfer] or
exercise of Debt Warrants), the Debt Warrant Agent shall promptly forward such
notice or demand to the Company.
Section 6.05 ADDRESSES. Any communications from the Company to the Debt
Warrant Agent with respect to this Agreement shall be directed to
____________________, Attention: ____________________, and any communications
from the Debt Warrant Agent to the Company with respect to this Agreement shall
be directed to Polaroid Corporation, 784 Memorial Drive, Cambridge,
Massachusetts 02139, Attention: Treasurer, with a copy to the Secretary (or such
other address as shall be specified in writing by the Debt Warrant Agent or by
the Company, as the case may be).
Section 6.06 APPLICABLE LAW. This Agreement and the Debt Warrants shall
be governed by and construed in accordance with the laws of the [State of
Delaware] applicable to contracts made and to be performed entirely within such
State.
Section 6.07 DELIVERY OF PROSPECTUS. The Company will furnish to the
Debt Warrant Agent sufficient copies of a prospectus or prospectuses relating to
the Underlying Debt Securities deliverable upon exercise of any outstanding Debt
Warrants (each a "Prospectus"), and the Debt Warrant Agent agrees to deliver to
the Holder of a Debt Warrant, prior to or concurrently with the delivery of the
Underlying Debt Securities issued upon the exercise thereof, a copy of the
Prospectus relating to such Underlying Debt Securities.
Section 6.08 GOVERNMENTAL APPROVALS. The Company will take such action
as may be necessary to obtain and keep effective any and all permits, consents
and approvals of governmental agencies and authorities, and will make all
filings under federal and state securities laws (including, without limitation,
the maintenance of the effectiveness of a registration statement in respect of
the Underlying Debt Securities under the Securities Act of 1933), as may
-14-
<PAGE>
be or become requisite in connection with the issuance, sale, transfer and
delivery of Debt Warrants and Debt Warrant Certificates, the exercise of Debt
Warrants and the issuance, sale and delivery of Underlying Debt Securities
issued upon exercise of Debt Warrants.
Section 6.09 PERSONS HAVING RIGHTS UNDER DEBT WARRANT AGREEMENT.
Nothing in this Agreement, expressed or implied, and nothing that may be
inferred from any of the provisions hereof is intended or shall be construed to
confer upon or give to any person or corporation other than the Company, the
Debt Warrant Agent and the Holders any right, remedy or claim under or by reason
of this Agreement or any covenant, condition, stipulation, promise or agreement
herein; and all covenants, conditions, stipulations, promises and agreements
herein shall be for the sole and exclusive benefit of the Company, the Debt
Warrant Agent and their respective successors and the Holders.
Section 6.10 HEADINGS. The descriptive headings of the several Articles
and Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
Section 6.11 COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which when so executed and delivered shall be deemed
to be an original; but all such counterparts taken together shall constitute one
and the same agreement.
Section 6.12 INSPECTION OF AGREEMENT. A copy of this Agreement shall be
available during business hours at the office of the Debt Warrant Agent for
inspection by any Holder. The Debt Warrant Agent may require such Holder to
submit its Debt Warrant Certificate for inspection prior to making such copy
available.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed all as of the day and year first above written.
POLAROID CORPORATION
[Seal]
By
----------------------------------
Attest: Name and Title:
---------------------------------
Name and Title:
-15-
<PAGE>
- -----------------------------------------
[Seal]
Attest:
By
----------------------------------
Name and Title:
---------------------------------
Name and Title:
-16-
<PAGE>
Exhibit A
to
[Senior] [Subordinated] Debt Warrant Agreement
dated as of __________, 19__
[Compensation of Debt Warrant Agent]
-17-
<PAGE>
Exhibit 4.23
- -------------------------------------------------------------------------------
POLAROID CORPORATION
and
-------------------------------
Stock Warrant Agent
STOCK WARRANT AGREEMENT*
Dated as of ______________, ____
FOR
UP TO ___ STOCK WARRANTS
EXPIRING ___________, _____
- -------------------------------------------------------------------------------
* OPTIONS REPRESENTED BY BRACKETED OR BLANK SECTIONS HEREIN SHALL
BE DETERMINED IN CONFORMITY WITH THE APPLICABLE PROSPECTUS
SUPPLEMENT OR SUPPLEMENTS.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
ARTICLE I
ISSUANCE OF STOCK WARRANTS AND EXECUTION AND
DELIVERY OF WARRANT CERTIFICATES.........................................................1
Section 1.01 Issuance of Stock Warrants....................................................................1
Section 1.02 Form and Execution of Warrant Certificates....................................................2
Section 1.03 Issuance and Delivery of Warrant Certificates.................................................3
Section 1.04 Temporary Warrant Certificates................................................................3
Section 1.05 Payment of Certain Taxes......................................................................4
Section 1.06 "Holder"......................................................................................4
ARTICLE II
DURATION AND EXERCISE OF STOCK WARRANTS.....................................................4
Section 2.01 Duration of Stock Warrants....................................................................4
Section 2.02 Exercise of Stock Warrants....................................................................4
Section 2.03 Stock Warrant Adjustments.....................................................................6
ARTICLE III
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS
OF STOCK WARRANTS................................................................6
Section 3.01 No Rights as Holder of Underlying [Preferred/Common/Depositary]
Share Conferred by Stock Warrants or Warrant Certificates.....................................6
Section 3.02 Lost, Stolen, Destroyed or Mutilated Warrant Certificates.....................................6
Section 3.03 Holders of Stock Warrants May Enforce Rights..................................................7
Section 3.04 Merger, Consolidation, Sale, Transfer or Conveyance...........................................7
ARTICLE IV
EXCHANGE AND TRANSFER OF STOCK WARRANTS.....................................................8
Section 4.01 Stock Warrant Register; Exchange and Transfer of Stock Warrants...............................8
Section 4.02 Treatment of Holders of Warrant Certificates..................................................9
Section 4.03 Cancellation of Warrant Certificates..........................................................9
ARTICLE V
CONCERNING THE WARRANT AGENT............................................................9
Section 5.01 Warrant Agent.................................................................................9
Section 5.02 Conditions of Warrant Agent's Obligations.....................................................9
Section 5.03 Resignation and Removal; Appointment of Successor............................................11
Section 5.04 Compliance With Applicable Laws..............................................................13
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Section 5.05 Office.......................................................................................13
ARTICLE VI
MISCELLANEOUS..................................................................13
Section 6.01 Supplements and Amendments...................................................................13
Section 6.02 Notices and Demands to the Company and Warrant Agent.........................................14
Section 6.03 Addresses for Notices........................................................................14
Section 6.04 Governing Law................................................................................14
Section 6.05 Governmental Approvals.......................................................................14
Section 6.06 Persons Having Rights Under Stock Warrant Agreement..........................................14
Section 6.07 Delivery of Prospectus.......................................................................14
Section 6.08 Headings.....................................................................................15
Section 6.09 Counterparts.................................................................................15
Section 6.10 Inspection of Agreement......................................................................15
</TABLE>
<PAGE>
2
This STOCK WARRANT AGREEMENT, dated as of ______________________,
between Polaroid Corporation, a Delaware corporation (the "Company"), and
_______________, a ________________ organized and existing under the laws of
________________ (the "Warrant Agent").
WHEREAS, the Company proposes to sell [title of debt securities,
preferred stock, common stock, depositary shares or other securities being
offered (the "Offered Securities")] with certificates evidencing one or more
warrants (the " Stock Warrants" or, individually, a " Stock Warrant")
representing the right to purchase [common stock, par value $1.00 per share, of
the Company (the "Common Shares")] [shares of a series of preferred stock, par
value $1.00 per share, of the Company (the "Preferred Shares")] [depositary
shares relating to a series of Preferred Shares (the "Depositary Shares")], such
warrant certificates and other warrant certificates issued pursuant to this
Agreement being herein called the "Warrant Certificates"; and
WHEREAS, the Company has duly authorized the execution and delivery
of this Stock Warrant Agreement to provide for the issuance of Stock Warrants to
be exercisable at such times and for such prices, and to have such other
provisions, as shall be fixed as hereinafter provided;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein contained, the parties hereto agree as follows:
ARTICLE I
ISSUANCE OF STOCK WARRANTS AND EXECUTION AND
DELIVERY OF WARRANT CERTIFICATES
Section 1.01 ISSUANCE OF STOCK WARRANTS. Stock Warrants may be issued
from time to time, together with or separately from Offered Securities. Prior to
the issuance of any Stock Warrants, there shall be established by or pursuant to
a resolution or resolutions duly adopted by the Company's Board of Directors or
by any committee thereof duly authorized to act with respect thereto (a "Board
Resolution"):
(a) the title and aggregate number of such Stock Warrants;
(b) the offering price of such Stock Warrants, if any;
(c) whether such Stock Warrants are to be issued with any Offered
Securities and, if so, the number and terms of any such Offered Securities
and the number of Stock Warrants to be issued with each Offered Security;
and the date, if any, on and after which the Stock Warrants and the
Offered Securities will be separately transferable (the "Detachable
Date");
(d) the designation, number and terms (including any subordination
and conversion provisions) of any Preferred Shares that are purchasable
upon exercise of such Share Warrants or that underlie Depositary Shares
purchasable on such exercise;
<PAGE>
3
(e) the time or times at which, or period or periods during which,
such Stock Warrants may be exercised and the final date on which such
Stock Warrants may be exercised (the "Expiration Date");
(f) the number of [Preferred/Common/Depositary] Shares that may be
purchased upon exercise of such Stock Warrants; the price, or the manner
of determining the price (the "Warrant Price"), at which such
[Preferred/Common/Depositary] Shares may be purchased upon exercise of the
Stock Warrants; and any minimum or maximum number of such Stock Warrants
that are exercisable at any one time;
(g) if applicable, any anti-dilution provisions of such Stock
Warrants;
(h) the terms of any right to redeem or call such Stock Warrants;
(i) the terms of any right of the Company to accelerate the
Expiration Date of the Stock Warrants upon the occurrence of certain
events;
(j) any other terms of such Stock Warrants not inconsistent with the
provisions of this Agreement.
Section 1.02 FORM AND EXECUTION OF WARRANT CERTIFICATES.
(a) The Stock Warrants shall be evidenced by the Warrant
Certificates, which shall be in registered form and substantially in such form
or forms as shall be established by or pursuant to a Board Resolution. Each
Warrant Certificate, whenever issued, shall be dated the date it is
countersigned by the Warrant Agent and may have such letters, numbers or other
marks of identification and such legends or endorsements printed, lithographed
or engraved thereon as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any
securities exchange on which the Stock Warrants may be listed, or to conform to
usage, as the officer of the Company executing the same may approve (such
officer's execution thereof to be conclusive evidence of such approval). Each
Warrant Certificate shall evidence one or more Stock Warrants.
(b) The Warrant Certificates shall be signed in the name and on
behalf of the Company by its Chairman of the Board of Directors, its President,
an Executive Vice President, any Vice President, the Treasurer or any Assistant
Treasurer and by its Secretary or any Assistant Secretary. Such signatures may
be manual or facsimile signatures of the present or any future holder of any
such office and may be imprinted or otherwise reproduced on the Warrant
Certificates. The seal of the Company may be in the form of a facsimile thereof
and may be impressed, affixed, imprinted or otherwise reproduced on the Warrant
Certificates.
(c) No Warrant Certificate shall be valid for any purpose, and no
Stock Warrant evidenced thereby shall be deemed issued or exercisable, until
such Warrant Certificate has been countersigned by the manual or facsimile
signature of the Warrant Agent. Such signature by the
<PAGE>
4
Warrant Agent upon any Warrant Certificate executed by the Company shall be
conclusive evidence that the Warrant Certificate so countersigned has been duly
issued hereunder.
(d) In case any officer of the Company who shall have signed any
Warrant Certificate either manually or by facsimile signature shall cease to be
such officer before the Warrant Certificate so signed shall have been
countersigned and delivered by the Warrant Agent, such Warrant Certificate
nevertheless may be countersigned and delivered as though the person who signed
such Warrant Certificate had not ceased to be such officer of the Company; and
any Warrant Certificate may be signed on behalf of the Company by such person
as, at the actual date of the execution of such Warrant Certificate, shall be
the proper officer of the Company, although at the date of the execution of this
Agreement such person was not such an officer.
Section 1.03 ISSUANCE AND DELIVERY OF WARRANT CERTIFICATES. At any
time and from time to time after the execution and delivery of this Agreement,
the Company may deliver Warrant Certificates executed by the Company to the
Warrant Agent for countersignature. Subject to the provisions of this Section
1.03, the Warrant Agent shall thereupon countersign and deliver such Warrant
Certificates to or upon the written request of the Company. Subsequent to the
original issuance of a Stock Warrant Certificate evidencing Stock Warrants, the
Warrant Agent shall countersign a new Warrant Certificate evidencing such Stock
Warrants only if such Warrant Certificate is issued in exchange or substitution
for one or more previously countersigned Warrant Certificates evidencing such
Stock Warrants or in connection with their transfer, as hereinafter provided.
Section 1.04 TEMPORARY WARRANT CERTIFICATES. Pending the preparation
of definitive Warrant Certificates, the Company may execute, and upon the order
of the Company the Warrant Agent shall countersign and deliver, temporary
Warrant Certificates that are printed, lithographed, typewritten, mimeographed
or otherwise produced, substantially of the tenor of the definitive Warrant
Certificates in lieu of which they are issued and with such appropriate
insertions, omissions, substitutions and other variations as the officer
executing such Warrant Certificates may determine, as evidenced by his execution
of such Warrant Certificates.
If temporary Warrant Certificates are issued, the Company will cause
definitive Warrant Certificates to be prepared without unreasonable delay. After
the preparation of definitive Warrant Certificates, the temporary Warrant
Certificates shall be exchangeable for definitive Warrant Certificates upon
surrender of the temporary Warrant Certificates at the corporate trust office of
the Warrant Agent [or ______________], without charge to the Holder, as defined
in Section 1.06 hereof. Upon surrender for cancellation of any one or more
temporary Warrant Certificates, the Company shall execute and the Warrant Agent
shall countersign and deliver in exchange therefor definitive Warrant
Certificates representing the same aggregate number of Stock Warrants. Until so
exchanged, the temporary Warrant Certificates shall in all respects be entitled
to the same benefits under this Agreement as definitive Warrant Certificates.
Section 1.05 PAYMENT OF CERTAIN TAXES. The Company will pay all stamp
and other duties, if any, to which this Agreement or the original issuance of
the Stock Warrants or Warrant Certificates may be subject under the laws of the
United States of America or any state or locality.
<PAGE>
5
Section 1.06 "HOLDER". The term "Holder" or "Holders" as used herein
with reference to a Warrant Certificate shall mean the person or persons in
whose name such Warrant Certificate shall then be registered as set forth in the
Warrant Register to be maintained by the Warrant Agent pursuant to Section 4.01
for that purpose or, in the case of Stock Warrants that are issued with Offered
Securities and cannot then be transferred separately therefrom, [if Registered
Offered Securities and Stock Warrants that are not then detachable, the person
or persons in whose name the related Offered Securities shall be registered as
set forth in the security register for such Offered Securities, prior to the
Detachable Date. The Company will, or will cause the security registrar of any
such Offered Securities to, make available to the Warrant Agent at all times
(including on and after the Detachable Date, in the case of Stock Warrants
originally issued with Offered Securities and not subsequently transferred
separately therefrom) such information as to holders of Offered Securities with
Stock Warrants as may be necessary to keep the Warrant Register up to date.]
ARTICLE II
DURATION AND EXERCISE OF STOCK WARRANTS
Section 2.01 DURATION OF STOCK WARRANTS. Each Stock Warrant may be
exercised at the time or times, or during the period or periods, provided by or
pursuant to the Board Resolution relating thereto and specified in the Warrant
Certificate evidencing such Stock Warrant. Each Stock Warrant not exercised at
or before 5:00 P.M., New York City time, on its Expiration Date shall become
void, and all rights of the Holder of such Stock Warrant thereunder and under
this Agreement shall cease, provided that the Company reserves the right to, and
may, in its sole discretion, at any time and from time to time, at such time or
times as the Company so determines, extend the Expiration Date of the Stock
Warrants for such periods of time as it chooses. Whenever the Expiration Date of
the Stock Warrants is so extended, the Company shall at least [20] days prior to
the then Expiration Date cause to be mailed to the Warrant Agent and the
registered Holders of the Stock Warrants in accordance with the provisions of
Section 6.03 hereof a notice stating that the Expiration Date has been extended
and setting forth the new Expiration Date. No adjustment shall be made for any
dividends on any [Preferred/ Common/Depositary] Shares issuable upon exercise of
any Stock Warrant.
Section 2.02 EXERCISE OF STOCK WARRANTS. (a) The Holder of a Stock
Warrant shall have the right, at its option, to exercise such Stock Warrant and,
subject to subsection (f) of this Section 2.02, purchase the number of
[Preferred/Common/Depositary] Shares provided for therein at the time or times
or during the period or periods referred to in Section 2.01 and specified in the
Warrant Certificate evidencing such Stock Warrant. No fewer than the minimum
number of Stock Warrants as set forth in the Warrant Certificate may be
exercised by or on behalf of any one Holder at any one time. Except as may be
provided in a Warrant Certificate, a Stock Warrant may be exercised by
completing the form of election to purchase set forth on the reverse side of the
Warrant Certificate, by duly executing the same, and by delivering the same,
together with payment in full of the Warrant Price, in lawful money of the
United States of America, in cash or by certified or official bank check or by
bank wire transfer, to the Warrant Agent. Except as may be provided in a Warrant
Certificate, the date on which such Warrant
<PAGE>
6
Certificate and payment are received by the Warrant Agent as aforesaid shall be
deemed to be the date on which the Stock Warrant is exercised and the relevant
[Preferred/Common/Depositary] Shares are issued.
(b) Upon the exercise of a Stock Warrant, the Company shall issue
to or upon the order of the Holder of such Warrant, the [Preferred/Common/
Depositary] Shares to which such Holder is entitled, registered, in the case
of [Preferred/Common/Depositary] Shares in registered form, in such name or
names as may be directed by such Holder.
(c) If fewer than all of the Stock Warrants evidenced by a Warrant
Certificate are exercised, the Company shall execute, and an authorized officer
of the Warrant Agent shall countersign and deliver, a new Warrant Certificate
evidencing the number of Stock Warrants remaining unexercised.
(d) The Warrant Agent shall deposit all funds received by it in
payment of the Warrant Price for Stock Warrants in the account of the Company
maintained with it for such purpose and shall advise the Company by telephone by
5:00 P.M., New York City time, of each day on which a payment of the Warrant
Price for Warrants is received of the amount so deposited in its account. The
Warrant Agent shall promptly confirm such telephone advice in writing to the
Company.
(e) The Warrant Agent shall, from time to time, as promptly as
practicable, advise the Company of (i) the number of Stock Warrants of each
title exercised as provided herein, (ii) the instructions of each Holder of such
Stock Warrants with respect to delivery of the [Preferred/Common/Depositary]
Shares issued upon exercise of such Stock Warrants to which such Holder is
entitled upon such exercise, and (iii) such other information as the Company
shall reasonably require. Such notice may be given by telephone to be promptly
confirmed in writing.
(f) The Company will pay all documentary stamp taxes attributable to
the initial issuance of Stock Warrants or to the issuance of
[Preferred/Common/Depositary] Shares to the registered Holder of such Stock
Warrants upon exercise thereof; provided, however, that the Holder, and not the
Company, shall be required to pay any stamp or other tax or other governmental
charge that may be imposed in connection with any transfer involved in the
issuance of the [Preferred/Common/Depositary] Shares; and in the event that any
such transfer is involved, the Company shall not be required to issue any
[Preferred/Common/Depositary] Shares (and the Holder's purchase of the
[Preferred/Common/Depositary] Shares issued upon the exercise of such Holder's
Stock Warrant shall not be deemed to have been consummated) until such tax or
other charge shall have been paid or it has been established to the Company's
satisfaction that no such tax or other charge is due.
Section 2.03 STOCK WARRANT ADJUSTMENTS. The terms and conditions,
if any, on which the exercise price of and/or the number of [Preferred/Common/
Depositary] Shares covered by a Stock Warrant are subject to adjustments will
be set forth in the Warrant Certificate and in the Prospectus Supplement
relating thereto. Such terms may include the adjustment mechanism for the
exercise price of, and the number of [Preferred/Common/Depositary] Shares
covered by, a Stock Warrant, the events requiring such adjustments, the
events upon which the Company may,
<PAGE>
7
in lieu of making such adjustments, make proper provisions so that the Holder,
upon exercise of such Holder's Stock Warrant, would be treated as if such Holder
had been a holder of the [Preferred/Common/Depositary] Shares received upon such
exercise, prior to the occurrence of such events, and provisions affecting
exercise of the Stock Warrants in the event of certain events affecting the
[Preferred/Common/Depositary] Shares.
ARTICLE III
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS
OF STOCK WARRANTS
Section 3.01 NO RIGHTS AS HOLDER OF UNDERLYING [PREFERRED/COMMON/
DEPOSITARY] SHARES CONFERRED BY STOCK WARRANTS OR WARRANT CERTIFICATES. No Stock
Warrants or Warrant Certificates shall entitle the Holder to any of the rights,
preferences and privileges of a holder of the underlying
[Preferred/Common/Depositary] Shares, including without limitation, any
dividend, voting, redemption, conversion, exchange and liquidation rights.
Section 3.02 LOST, STOLEN, DESTROYED OR MUTILATED WARRANT
CERTIFICATES. Upon receipt by the Company and the Warrant Agent of evidence
reasonably satisfactory to them of the ownership of and the loss, theft,
destruction or mutilation of any Warrant Certificate and of indemnity (other
than in connection with any mutilated Warrant Certificates surrendered to the
Warrant Agent for cancellation) reasonably satisfactory to them, the Company
shall execute, and Warrant Agent shall countersign and deliver, in exchange for
or in lieu of each lost, stolen, destroyed or mutilated Warrant Certificate, a
new Warrant Certificate evidencing a like number of Stock Warrants of the same
title. Upon the issuance of a new Warrant Certificate under this Section, the
Company may require the payment of a sum sufficient to cover any stamp or other
tax or other governmental charge that may be imposed in connection therewith and
any other expenses (including the fees and expenses of the Warrant Agent) in
connection therewith. Every substitute Warrant Certificate executed and
delivered pursuant to this Section in lieu of any lost, stolen or destroyed
Warrant Certificate shall represent a contractual obligation of the Company,
whether or not such lost, stolen or destroyed Warrant Certificate shall be at
any time enforceable by anyone, and shall be entitled to the benefits of this
Agreement equally and proportionately with any and all other Warrant rights and
remedies with respect to the replacement of lost, stolen, destroyed or mutilated
Warrant Certificates.
Section 3.03 HOLDERS OF STOCK WARRANTS MAY ENFORCE RIGHTS.
Notwithstanding any of the provisions of this Agreement, any Holder may, without
the consent of the Warrant Agent, enforce and may institute and maintain any
suit, action or proceeding against the Company suitable to enforce, or otherwise
in respect of, its right to exercise his Stock Warrants as provided in the Stock
Warrants and in this Agreement.
Section 3.04 MERGER, CONSOLIDATION, SALE, TRANSFER OR CONVEYANCE. (a)
In case any of the following shall occur while any Stock Warrants are
outstanding: (i) any reclassification or change of the outstanding
[Preferred/Common/Depositary] Shares; or (ii) any consolidation or merger to
which the Company is party (other than a consolidation or a merger in which the
<PAGE>
8
Company is the continuing corporation and which does not result in any
reclassification of, or change in, the outstanding [Preferred/Common] Shares
issuable upon exercise of the Stock Warrants [or underlying the Depositary
Shares issuable upon exercise of the Depositary Stock Warrants]); or (iii) any
sale, conveyance or lease to another corporation of the property of the Company
as an entirety or substantially as an entirety; then the Company, or such
successor or purchasing corporation, as the case may be, shall make appropriate
provision by amendment of this Agreement or otherwise so that the Holders of the
Stock Warrants then outstanding shall have the right at any time thereafter,
upon exercise of such Stock Warrants, to purchase the kind and amount of capital
shares and other securities and property receivable upon such a
reclassification, change, consolidation, merger, sale, conveyance or lease as
would be received by a holder of the number of [Preferred/ Common] Shares
issuable upon exercise of such Stock Warrant [or underlying the Depositary
Shares issuable upon exercise of the Depositary Stock Warrants] immediately
prior to such reclassification, change, consolidation, merger, sale, conveyance
or lease, and, in the case of a consolidation, merger, sale, conveyance or
lease, the Company shall thereupon be relieved of any further obligation
hereunder or under the Stock Warrants, and the Company as the predecessor
corporation may thereupon or at any time thereafter be dissolved, wound up or
liquidated. Such successor or assuming corporation thereupon may cause to be
signed, and may issue either in its own name or in the name of the Company, any
of all of the Stock Warrants issuable hereunder which theretofore shall not have
been signed by the Company, and may execute and deliver [Preferred/Common/
Depositary] Shares in its own name, in fulfillment of its obligations to
deliver Shares upon exercise of the Stock Warrants. All the Stock Warrants so
issued shall in all respects have the same legal rank and benefit under this
Agreement as the Stock Warrants theretofore or thereafter issued in
accordance with the terms of this Agreement as though all of such Stock
Warrants had been issued at the date of the execution hereof. In any case of
any such reclassification, change, consolidation, merger, conveyance,
transfer or lease, such changes in phraseology and form (but not in
substance) may be made in the Stock Warrants thereafter to be issued as may
be appropriate.
(b) The Stock Warrant Agent may receive a written opinion of legal
counsel as conclusive evidence that any such merger, consolidation, sale,
transfer, conveyance or other disposition of substantially all of the assets of
the Company complies with the provisions of this Section 3.04.
ARTICLE IV
EXCHANGE AND TRANSFER OF STOCK WARRANTS
Section 4.01 STOCK WARRANT REGISTER; EXCHANGE AND TRANSFER OF STOCK
WARRANTS. The Warrant Agent shall maintain, at its corporate trust office [or at
___________________], a register (the "Warrant Register") in which, upon the
issuance of Stock Warrants, or on and after the Detachable Date in the case of
Stock Warrants not separately transferable prior thereto, and, subject to such
reasonable regulations as the Warrant Agent may prescribe, it shall register
Warrant Certificates and exchanges and transfers thereof. The Warrant Register
shall be in written form or in any other form capable of being converted into
written form within a reasonable time.
<PAGE>
9
Except as provided in the following sentence, upon surrender at the
corporate trust office of the Warrant Agent [or at ___________________],
Warrant Certificates may be exchanged for one or more other Warrant Certificates
evidencing the same aggregate number of Stock Warrants of the same title, or may
be transferred in whole or in part. A Warrant Certificate evidencing Stock
Warrants that are not then transferable separately from the Offered Security
with which they were issued may be exchanged or transferred prior to its
Detachable Date only together with such Offered Security and only for the
purpose of effecting, or in conjunction with, an exchange or transfer of such
Offered Security; and on or prior to the Detachable Date, each exchange or
transfer of such Offered Security on the Security Register of the Offered
Securities shall operate also to exchange or transfer the related Stock
Warrants. A transfer shall be registered upon surrender of a Warrant Certificate
to the Warrant Agent at its corporate trust office [or at _____________________]
for transfer, properly endorsed or accompanied by appropriate instruments of
transfer and written instructions for transfer, all in form satisfactory to the
Company and the Warrant Agent, duly signed by the registered holder or holders
thereof or by the duly appointed legal representative thereof or by a duly
authorized attorney, such signature to be guaranteed by (a) a bank or trust
company, (b) a broker or dealer that is a member of the National Association of
Securities Dealers, Inc. (the "NASD") or (c) a member of a national securities
exchange. Upon any such registration of transfer, a new Warrant Certificate
shall be issued to the transferee. Whenever a Warrant Certificate is surrendered
for exchange or transfer, the Warrant Agent shall countersign and deliver to the
person or persons entitled thereto one or more Warrant Certificates duly
executed by the Company, as so requested. The Stock Warrant Agent shall not be
required to effect any exchange or transfer which will result in the issuance of
a Warrant Certificate evidencing a fraction of a Stock Warrant. All Warrant
Certificates issued upon any exchange or transfer of a Warrant Certificate shall
be the valid obligations of the Company, evidencing the same obligations, and
entitled to the same benefits under this Agreement, as the Warrant Certificate
surrendered for such exchange or transfer.
No service charge shall be made for any exchange or transfer of Stock
Warrants, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection with any such
exchange or transfer, in accordance with Section 2.02(f) hereof.
Section 4.02 TREATMENT OF HOLDERS OF WARRANT CERTIFICATES.
(a) In the event that the Stock Warrants are offered together with,
and, prior to the Detachable Date, are not detachable from, Offered Securities,
the Company, the Warrant Agent and all other persons may, prior to such
Detachable Date, treat the holder of the Offered Security as the Holder of the
Warrant Certificates initially attached thereto for any purpose and as the
person entitled to exercise the rights represented by the Stock Warrants
evidenced by such Warrant Certificates, any notice to the contrary
notwithstanding. After the Detachable Date and prior to due presentment of a
Warrant Certificate for registration or transfer, the Company and the Warrant
Agent may treat the registered Holder of a Warrant Certificate as the absolute
Holder thereof for any purpose and as the person entitled to exercise the rights
represented by the Stock Warrants evidenced thereby, any notice to the contrary
notwithstanding.
<PAGE>
10
(b) In all other cases, the Company and the Warrant Agent may treat
the registered Holder of a Warrant Certificate as the absolute Holder thereof
for any purpose and as the person entitled to exercise the rights represented by
the Stock Warrants evidenced thereby, any notice to the contrary
notwithstanding.
Section 4.03 CANCELLATION OF WARRANT CERTIFICATES. In the event that
the Company shall purchase, redeem or otherwise acquire any Stock Warrants after
the issuance thereof, the Warrant Certificate or Warrant Certificates evidencing
such Stock Warrants shall thereupon be delivered to the Warrant Agent and be
cancelled by it. The Warrant Agent shall also cancel any Warrant Certificate
(including any Warrant Certificate) delivered to it for exercise, in whole or in
part, or for exchange or transfer. Warrant Certificates so cancelled shall be
delivered by the Warrant Agent to the Company from time to time, or disposed of
in accordance with the instructions of the Company.
ARTICLE V
CONCERNING THE WARRANT AGENT
Section 5.01 WARRANT AGENT. The Company hereby appoints
_______________ as Warrant Agent of the Company in respect of the Stock Warrants
upon the terms and subject to the conditions set forth herein; and ___________
hereby accepts such appointment. The Warrant Agent shall have the powers and
authority granted to and conferred upon it in the Warrant Certificates and
hereby, and such further powers and authority acceptable to it to act on behalf
of the Company as the Company may hereafter grant to or confer upon it. All of
the terms and provisions with respect to such powers and authority contained in
the Warrant Certificates are subject to and governed by the terms and provisions
hereof.
Section 5.02 CONDITIONS OF WARRANT AGENT'S OBLIGATIONS. The Warrant
Agent accepts its obligations set forth herein upon the terms and conditions
hereof, including the following, to all of which the Company agrees and to all
of which the rights hereunder of the Holders shall be subject:
(a) Compensation and Indemnification. The Company agrees to promptly
pay the Warrant Agent the compensation set forth in Exhibit A hereto and
to reimburse the Warrant Agent for reasonable out-of-pocket expenses
(including counsel fees) incurred by the Warrant Agent in connection with
the services rendered hereunder by the Warrant Agent. The Company also
agrees to indemnify the Warrant Agent for, and to hold it harmless
against, any loss, liability or expense (including the reasonable costs
and expenses of defending against any claim of liability) incurred without
negligence or bad faith on the part of the Warrant Agent arising out of or
in connection with its appointment, status or service as Warrant Agent
hereunder.
(b) Agent for the Company. In acting under this Agreement and in
connection with any Warrant Certificate, the Warrant Agent is acting
solely as agent of the Company and does not assume any obligation or
relationship of agency or trust for or with any Holder.
<PAGE>
11
(c) Counsel. The Warrant Agent may consult with counsel satisfactory
to it, and the advice of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in accordance with the advice of
such counsel.
(d) Documents. The Warrant Agent shall be protected and shall incur
no liability for or in respect of any action taken, suffered or omitted by
it in reliance upon any notice, direction, consent, certificate,
affidavit, statement or other paper or document reasonably believed by it
to be genuine and to have been presented or signed by the proper parties.
(e) Officer's Certificate. Whenever in the performance of its duties
hereunder the Warrant Agent shall reasonably deem it necessary that any
fact or matter be proved or established by the Company prior to taking,
suffering or omitting any action hereunder, the Warrant Agent may (unless
other evidence in respect thereof be herein specifically prescribed), in
the absence of bad faith on its part, rely upon a certificate signed by
the Chairman of the Board of Directors, the Vice Chairman of the Board of
Directors, the President, an Executive Vice President, the Treasurer, an
Assistant Treasurer, the Secretary or an Assistant Secretary of the
Company (an "Officer's Certificate") delivered by the Company to the
Warrant Agent.
(f) Actions Through Agents. The Warrant Agent may execute and
exercise any of the rights or powers hereby vested in it or perform any
duty hereunder either itself or by or through its attorneys or agents, and
the Warrant Agent shall not be answerable or accountable for any act,
default, neglect or misconduct of any such attorney or agent or for any
loss to the Company resulting from such neglect or misconduct; provided,
however, that reasonable care shall have been exercised in the selection
and continued employment of such attorneys and agents.
(g) Certain Transactions. The Warrant Agent, and any officer,
director or employee thereof, may become the owner of, or acquire any
interest in, any Stock Warrant, with the same rights that he, she or it
would have if it were not the Warrant Agent, and, to the extent permitted
by applicable law, he, she or it may engage or be interested in any
financial or other transaction with the Company and may serve on, or as
depository, trustee or agent for, any committee or body of holders of
[Preferred/Common/Depositary] Shares or other obligations of the Company
as if it were not the Warrant Agent.
(h) No Liability For Interest. The Warrant Agent shall not be liable
for interest on any monies at any time received by it pursuant to any of
the provisions of this Agreement or of the Warrant Certificates, except as
otherwise agreed with the Company.
(i) No Liability For Invalidity. The Warrant Agent shall incur no
liability with respect to the validity of this Agreement (except as to the
due execution hereof by the Warrant Agent) or any Warrant Certificate
(except as to the countersignature thereof by the Warrant Agent).
<PAGE>
12
(j) No Responsibility For Company Representations. The Warrant Agent
shall not be responsible for any of the recitals or representations
contained herein (except as to such statements or recitals as describe the
Warrant Agent or action taken or to be taken by it) or in any Warrant
Certificate (except as to the Warrant Agent's countersignature on such
Warrant Certificate), all of which recitals and representations are made
solely by the Company.
(k) No Implied Obligations. The Warrant Agent shall be obligated to
perform only such duties as are specifically set forth herein, and no
other duties or obligations shall be implied. The Warrant Agent shall not
be under any obligation to take any action hereunder that may subject it
to any expense or liability, the payment of which within a reasonable time
is not, in its reasonable opinion, assured to it. The Warrant Agent shall
not be accountable or under any duty or responsibility for the use by the
Company of any Warrant Certificate countersigned by the Warrant Agent and
delivered by it to the Company pursuant to this Agreement or for the
application by the Company of the proceeds of the issuance or exercise of
Stock Warrants. The Warrant Agent shall have no duty or responsibility in
case of any default by the Company in the performance of its covenants or
agreements contained herein or in any Warrant Certificate or in case of
the receipt of any written demand from a Holder with respect to such
default, including, without limiting the generality of the foregoing, any
duty or responsibility to initiate or attempt to initiate any proceedings
at law or otherwise or, except as provided in Section 6.02 hereof, to make
any demand upon the Company.
Section 5.03 RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR. (a)
The Company agrees, for the benefit of the Holders of the Stock Warrants, that
there shall at all times be a Warrant Agent hereunder until all the Stock
Warrants are no longer exercisable.
(b) The Warrant Agent may at any time resign as such by giving
written notice to the Company, specifying the date on which its desired
resignation shall become effective; provided that such date shall not be less
than [90] days after the date on which such notice if given unless the Company
agrees to accept a shorter notice. The Warrant Agent hereunder may be removed at
any time by the filing with it of an instrument in writing signed by or on
behalf of the Company and specifying such removal and the date when it shall
become effective. Notwithstanding the provisions of this Section 5.03(b), such
resignation or removal shall take effect upon the appointment by the Company, as
hereinafter provided, of a successor Warrant Agent (which shall be a banking
institution organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under the
laws of such jurisdiction to exercise corporate trust powers and having at the
time of its appointment as Warrant Agent a combined capital and surplus (as set
forth in its most recent published report of financial condition) of at least
[$50,000,000])and the acceptance of such appointment by such successor Warrant
Agent. In the event a successor Warrant Agent has not been appointed and has not
accepted its duties within [90] days of the Warrant Agent's notice of
resignation, the Warrant Agent may apply to any court of competent jurisdiction
for the designation of a successor Warrant Agent. The obligations of the Company
under Section 5.02(a) shall continue to the extent set forth therein
notwithstanding the resignation or removal of the Warrant Agent.
(c) In case at any time the Warrant Agent shall resign, or shall be
removed, or shall become incapable of acting, or shall file a petition seeking
relief under Title 11 of the United
<PAGE>
13
States Code, as now constituted or hereafter amended or under any other
applicable federal or state bankruptcy law or similar law, or make an assignment
for the benefit of its creditors or consent to the appointment of a receiver or
custodian of all or any substantial part of its property, or shall admit in
writing its inability to pay or meet its debts as they mature, or if a receiver
or custodian of it or all or any substantial part of its property shall be
appointed, or if an order of any court shall be entered for relief against it
under the provisions of Title 11 of the United States Code, as now constituted
or hereafter amended, or under any other applicable federal or state bankruptcy
or similar law, or if any public officer shall have taken charge or control of
the Warrant Agent or of its property or affairs, for the purpose of
rehabilitation, conservation or liquidation, a successor Warrant Agent,
qualified as aforesaid, shall be appointed by the Company by an instrument in
writing, filed with the successor Warrant Agent. Upon the appointment as
aforesaid of a successor Warrant Agent and acceptance by the latter of such
appointment, the Warrant Agent so superseded shall cease to be Warrant Agent
hereunder.
(d) Any successor Warrant Agent appointed hereunder shall execute,
acknowledge and deliver to its predecessor and to the Company an instrument
accepting such appointment hereunder, and thereupon such successor Warrant
Agent, without any further act, deed or conveyance, shall become vested with all
the authority, rights, powers, trusts, immunities, duties and obligations of
such predecessor with like effect as if originally named as Warrant Agent
hereunder, and such predecessor, upon payment of its charges and disbursements
then unpaid, shall thereupon become obligated to transfer, deliver and pay over,
and such successor Warrant Agent shall be entitled to receive all moneys,
securities and other property on deposit with or held by such predecessor, as
Warrant Agent hereunder.
(e) Any corporation into which the Warrant Agent hereunder may be
merged or converted or any corporation with which the Warrant Agent may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Warrant Agent shall be a party, or any corporation to
which the Warrant Agent shall sell or otherwise transfer all or substantially
all of the assets and business of the Warrant Agent, provided that such
Corporation shall be qualified as aforesaid, shall be the successor Warrant
Agent under this Agreement without the execution or filing of any paper or any
further act on the part of any of the parties hereto.
Section 5.04 COMPLIANCE WITH APPLICABLE LAWS. The Warrant Agent
agrees to comply with all applicable federal and state laws imposing obligations
on it in respect of the services rendered by it under this Warrant Agreement and
in connection with the Stock Warrants, including (but not limited to) the
provisions of United States federal income tax laws regarding information
reporting and backup withholding. The Warrant Agent expressly assumes all
liability for its failure to comply with any such laws imposing obligations on
it, including (but not limited to) any liability for failure to comply with any
applicable provisions of United States federal income tax laws regarding
information reporting and backup withholding.
Section 5.05 OFFICE. The Company will maintain an office or agency
where Warrant Certificates may be presented for exchange, transfer or exercise.
The office initially designated for this purpose shall be the corporate trust
office of the Warrant Agent at ________________.
<PAGE>
14
ARTICLE VI
MISCELLANEOUS
Section 6.01 SUPPLEMENTS AND AMENDMENTS. (a) The Company and Warrant
Agent may from time to time supplement or amend this Agreement without the
approval or consent of any Holder in order to cure any ambiguity, to correct or
supplement any provision contained herein that may be defective or inconsistent
with any other provisions herein, or to make any other provision in regard to
matters or questions arising hereunder that the Company and the Warrant Agent
may deem necessary or desirable and that shall not adversely affect the
interests of the Holders. Every Holder of Debt Warrants, whether issued before
or after any such supplement or amendment, shall be bound thereby. Promptly
after the effectiveness of any supplement or amendment that affects the interest
of the Holders, the Company shall give notice thereof, as provided in Section
6.03 hereof, to the Holders affected thereby, setting forth in general terms the
substance of such supplement or amendment.
(b) The Company and the Warrant Agent may modify or amend this
Agreement and the Warrant Certificates with the consent of the Holders of not
fewer than a majority in number of the underlying [Preferred/Common/Depositary]
Shares affected by such modification or amendment, for any purpose; provided,
however, that no such modification or amendment that shortens the period of time
during which the Stock Warrants may be exercised, or otherwise materially and
adversely affects the exercise rights of the Holders or reduces the percentage
of Holders of outstanding Stock Warrants the consent of which is required for
modification or amendment of this Agreement or the Stock Warrants, may be made
without the consent of each Holder affected thereby.
Section 6.02 NOTICES AND DEMANDS TO THE COMPANY AND WARRANT AGENT. If
the Warrant Agent shall receive any notice or demand addressed to the Company by
any Holder pursuant to the provisions of the Warrant Certificates, the Warrant
Agent shall promptly forward such notice or demand to the Company.
Section 6.03 ADDRESSES FOR NOTICES. Any communications from the
Company to the Warrant Agent with respect to this Agreement shall be addressed
to [name of Warrant Agent, _______________, Attention: Corporate Trust
Department;] any communications from the Warrant Agent to the Company with
respect to this Agreement shall be addressed to Polaroid Corporation, 784
Memorial Drive, Cambridge, Massachusetts 02139, Attention: Treasurer (with a
copy to the Secretary); or such other addresses as shall be specified in writing
by the Warrant Agent or by the Company, as the case may be.
Section 6.04 GOVERNING LAW. This Agreement and the Stock Warrants
shall be governed by the laws of the [State of Delaware] applicable to contracts
made and to be performed entirely within such State.
Section 6.05 GOVERNMENTAL APPROVALS. The Company will from time to
time use all reasonable efforts to obtain and keep effective any and all
permits, consents and approvals of governmental agencies and authorities and the
national securities exchange on which the Stock
<PAGE>
15
Warrants may be listed or authorized for trading from time to time and will make
all filings under the federal and state securities laws (including without
limitation the Securities Act of 1933), as may be or become requisite in
connection with the issuance, sale, trading, transfer or delivery of the Stock
Warrants and Warrant Certificates, the exercise of the Stock Warrants and the
issuance, sale and delivery of the underlying [Preferred/Common/Depositary]
Shares issued upon the exercise of the Stock Warrants.
Section 6.06 PERSONS HAVING RIGHTS UNDER STOCK WARRANT AGREEMENT.
Nothing in this Agreement expressed or implied and nothing that may be inferred
from any of the provisions hereof is intended, or shall be construed, to confer
upon, or give to, any person or corporation other than the Company, the Warrant
Agent and the Holders any right, remedy or claim under or by reason of this
Agreement or of any covenant, condition, stipulation, promise or agreement
hereof; and all covenants, conditions, stipulations, promises and agreements in
this Agreement contained shall be for the sole and exclusive benefit of the
Company and the Warrant Agent and their respective successors and of the Holders
of Warrant Certificates.
Section 6.07 DELIVERY OF PROSPECTUS. The Company will furnish to the
Warrant Agent sufficient copies of a prospectus or prospectuses relating to the
[Preferred/Common/ Depositary] Shares deliverable upon exercise of any
outstanding Stock Warrants (each a "Prospectus"), and prior to or concurrent
with the delivery of the [Preferred/Common/Depositary] Shares issued upon the
exercise thereof, a copy of the Prospectus relating to such [Preferred/
Common/Depositary] Shares.
Section 6.08 HEADINGS. The descriptive headings of the several
Articles and Sections and the Table of Contents of this Agreement are for
convenience only and shall not control or affect the meaning or construction of
any of the provisions hereof.
Section 6.09 COUNTERPARTS. This Agreement may be executed by the
parties hereto in any number of counterparts, each of which when so executed and
delivered shall be deemed to be an original; but all such counterparts shall
together constitute but one and the same instrument.
Section 6.10 INSPECTION OF AGREEMENT. A copy of this Agreement shall
be available at all reasonable times at the principal corporate trust office of
the Warrant Agent, for inspection by the Holders of Stock Warrants.
* * * * *
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first above written.
<PAGE>
16
POLAROID CORPORATION
Seal
By: __________________________
Attest: Name and Title
------------------------------
NAME AND TITLE:
STOCK WARRANT AGENT
Seal
By: __________________________
Attest: Name and Title
------------------------------
NAME AND TITLE:
<PAGE>
Exhibit A
to Stock Warrant Agreement
dated as of ____________, 19__
[Compensation of Warrant Agent]
<PAGE>
[letterhead of Simpson Thacher & Bartlett]
February 2, 2000
POLAROID CORPORATION
784 Memorial Drive
Cambridge, Massachusetts 02139
Ladies and Gentlemen:
We have acted as counsel to Polaroid Corporation, a Delaware
corporation (the "Company"), in connection with the Registration Statement on
Form S-3 (File No. 333-67647) filed by the Company with the Securities and
Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended (the "Act"), as it became effective under the Act (the "First
Registration Statement"), relating to debt securities of the Company, and the
Registration Statement on Form S-3 filed by the Company with the Commission
under the Act (the "Second Registration Statement" and, together with the First
Registration Statement, the "Registration Statements"), which Second
Registration Statement constitutes Post-Effective Amendment No.1 to the First
Registration Statement, relating to (a) shares of common stock, par value $1.00
per share, of the Company (the "Common Stock"); (b) rights (the "Rights") to
purchase shares of the Series A Participating Cumulative Preferred Stock, par
value $1.00 per share, of the Company (the "Series A Preferred Stock"), which
are issuable under a Rights Agreement (the "Rights Agreement") dated as of
September 9, 1986 between the Company and Morgan Shareholder Services Trust
Company, as rights agent (the "Rights Agent"), as amended, and which are
issuable in connection with the issuance of shares of Common Stock; (iii) shares
of preferred stock, par value $1.00 per share, of the Company (the "Preferred
Stock"), which may be convertible into shares of Common Stock; (iv) depositary
shares (the "Depositary Shares"), representing fractional shares of Preferred
Stock and evidenced by depositary receipts (the "Depositary Receipts"); (v) debt
securities, which may be either senior (the "Senior Debt Securities") or
<PAGE>
POLAROID CORPORATION -2- February 2, 2000
subordinated (the "Subordinated Debt Securities" and, with the Senior Debt
Securities, the "Debt Securities), either of which may be convertible into
shares of Common Stock; (vi) contracts for purchase and sale of Common Stock
(the "Stock Purchase Contracts"); (vii) stock purchase units of the Company,
consisting of (a) a Stock Purchase Contract under which the holder, upon
settlement, will purchase shares of Common Stock and (b) any of a share of
Preferred Stock, a Depositary Share, a Debt Security or a debt obligation of a
third party (the "Stock Purchase Units"); (viii) warrants to purchase shares of
Common Stock, shares of Preferred Stock or Depositary Shares (collectively, the
"Equity Securities Warrants") or either of the Debt Securities (the "Debt
Securities Warrants" and, together with the Equity Securities Warrants, the
"Securities Warrants"); (ix) warrant units, consisting of (a) a warrant to
purchase shares of Common Stock and (b) any of a share of Preferred Stock, a
Depositary Share or a Debt Security (the "Warrant Units"); and (x) Common Stock,
Preferred Stock, Depositary Shares and Debt Securities which may be issued upon
settlement of Stock Purchase Contracts, upon conversion of shares of Preferred
Stock, upon conversion of Debt Securities or upon exercise of Securities
Warrants, whichever is applicable. The Common Stock, the Rights, the Preferred
Stock, the Depositary Shares, the Debt Securities, the Stock Purchase Contracts,
the Stock Purchase Units, the Securities Warrants and the Warrant Units are
hereinafter referred to collectively as the "Securities." The Securities may be
issued and sold or delivered from time to time as set forth in the Second
Registration Statement, any amendment thereto, the prospectus contained therein
(the "Prospectus") and supplements to the Prospectus (the "Prospectus
Supplements") pursuant to Rule 415 under the Act. Pursuant to Rule 429 under the
Act, the Prospectus is a combined prospectus that relates to (i) securities
which were designated as Debt Securities by the First Registration Statement
with an aggregate initial offering price not to exceed $275,000,000 or the
equivalent thereof in one or more foreign currencies or one or more currency
units covered by the First Registration Statement and (ii) Securities with an
aggregate initial offering price not to exceed $225,000,000 or the equivalent
thereof in one or more foreign currencies or one or more currency units covered
by the Second Registration Statement.
<PAGE>
POLAROID CORPORATION -3- February 2, 2000
The Depositary Shares will be issued pursuant to a deposit agreement
(the "Deposit Agreement") between the Company and a depositary (the
"Depositary").
The Rights will be issued under the Rights Agreement.
The Debt Securities will be issued pursuant to an Indenture dated as
of January 9, 1997, as supplemented by a Supplemental Indenture dated as of
February 17, 1999 (the "Indenture"), in each case, by and between the Company
and State Street Bank and Trust Company, as Trustee (the "Trustee"), to be
further supplemented, as necessary, by one or more further supplemental
indentures (each, a "Supplemental Indenture") to be entered into by and between
the Company and the Trustee.
The Stock Purchase Contracts will be issued pursuant to a stock
purchase contract agreement (the "Stock Purchase Contract Agreement") to be
entered into by and between the Company and a stock purchase contract agent of
the Company, as stock purchase contract agent (the "Stock Purchase Contract
Agent").
The Stock Purchase Units will be issued pursuant to a stock purchase
unit agreement ("Stock Purchase Unit Agreement") to be entered by and between
the Company and a stock purchase unit agent of the Company, as stock purchase
unit agent (the "Stock Purchase Unit Agent").
The Equity Securities Warrants will be issued pursuant to a warrant
agreement (the "Equity Securities Warrant Agreement") to be entered into by and
between the Company and a warrant agent of the Company. The Debt Securities
Warrants will be issued under a warrant agreement (the "Debt Securities Warrant
Agreement") to be entered into by and among the Company, a warrant agent of the
Company and the Trustee. The Equity Securities Warrant Agreement and the Debt
Securities Warrant Agreement are hereinafter referred to collectively as the
"Warrant Agreements."
The Warrant Units consisting of (a) a warrant to purchase shares of
Common Stock and (b) a share of Preferred Stock or a Depositary Share will be
issued pursuant to a warrant unit agreement (the "Equity Securities Warrant Unit
Agreement") to be entered into
<PAGE>
POLAROID CORPORATION -4- February 2, 2000
by and between the Company and a warrant unit agent. The Warrant Units
consisting of (a) a warrant to purchase shares of Common Stock and (b) a Debt
Security will be issued pursuant to a warrant unit agreement (the "Debt
Securities Warrant Unit Agreement" and, together with the Equity Securities
Warrant Unit Agreement, the "Warrant Unit Agreements") to be entered into by
and among the Company, a warrant unit agent and the Trustee. Each party to a
Warrant Agreement or a Warrant Unit Agreement other than the Company is
referred to hereinafter as a "Counterparty."
We have examined the Registration Statements, a form of the share
certificate representing shares of Common Stock, the Certificate of
Designations, Powers, Preferences and Rights of the Series A Preferred Stock,
the Rights Agreement, the form of certificate representing the Rights, the form
of the Certificate of Designations, Powers, Preferences and Rights of the
Preferred Stock (the "Certificate of Designations"), the share certificate
representing shares of Preferred Stock, the form of Deposit Agreement, the form
of Depositary Receipt, the Indenture, the form of Supplemental Indenture, the
form of note representing each of the Senior Debt Securities and the
Subordinated Debt Securities, the form of Stock Purchase Contract Agreement, the
form of Equity Securities Warrant Agreement and the form of Debt Securities
Warrant Agreement, each of which has been filed with the Commission as exhibits
to the Second Registration Statement. We also have examined the originals, or
duplicates or certified or conformed copies, of such records, agreements,
instruments and other documents and have made such other and further
investigations as we have deemed relevant and necessary in connection with the
opinions expressed herein. As to questions of fact material to this opinion, we
have relied upon certificates of public officials and of officers and
representatives of the Company.
In rendering the opinions set forth below, we have assumed the
genuineness of all signatures, the legal capacity of natural persons, the
authenticity of all documents submitted to us as originals, the conformity to
original documents of all documents submitted to us as duplicates or certified
or conformed copies, and the authenticity of the originals of such latter
documents. We also have assumed that: (i) the Rights Agreement is the valid and
legally binding obligation of the Rights Agent; (ii) at the time of execution,
issuance and
<PAGE>
POLAROID CORPORATION -5- February 2, 2000
delivery of the Depositary Shares, the Deposit Agreement will be the valid and
legally binding obligation of the Depositary; (iii) the Indenture is the valid
and legally binding obligation of the Trustee; (iv) at the time of execution,
authentication, issuance and delivery of the Debt Securities, the definitive
Supplemental Indenture, if necessary, will be the valid and legally binding
obligation of the Trustee; (v) at the time of execution, issuance and delivery
of the Stock Purchase Contracts, the Stock Purchase Contract Agreement will be
the valid and legally binding obligation of the Stock Purchase Contract Agent;
(vi) at the time of execution, issuance, authentication and delivery of the debt
obligation of a third party which constitutes part of a Stock Purchase Unit,
such debt obligation will be the valid and legally binding obligation of such
third party; (vi) at the time of execution, countersignature, issuance and
delivery of any Securities Warrants, the related Warrant Agreement or the
related Warrant Unit Agreement will be the valid and legally binding obligation
of each Counterparty thereto; and (vii) the Company is validly existing under
the laws of Delaware.
We have assumed further that: (i) at the time of execution, issuance
and delivery of the Deposit Agreement, the Deposit Agreement will have been duly
authorized, executed and delivered by the Company; (ii) at the time of
execution, authentication, issuance and delivery of the Debt Securities, the
Supplemental Indenture, if necessary, will have been duly authorized, executed
and delivered by the Company; (iii) at the time of execution, issuance and
delivery of the Stock Purchase Contracts, the Stock Purchase Contract Agreement
will have been duly authorized, executed and delivered by the Company; and (v)
at the time of execution, countersignature, issuance and delivery of any
Securities Warrants, the related Warrant Agreement will have been duly
authorized, executed and delivered by the Company.
Based upon the foregoing, and subject to the qualifications and
limitations stated herein, we are of the opinion that:
1. With respect to the Common Stock, assuming (a) the taking by the
Board of Directors of the Company of all necessary corporate action to
authorize and approve the issuance of the Common Stock and (b) the due
issuance and delivery of the Common Stock, upon payment of the
consideration therefor in accordance with the applicable definitive
purchase, underwriting or similar agreement approved by the Board of
<PAGE>
POLAROID CORPORATION -6- February 2, 2000
Directors of the Company, the Common Stock will be validly issued, fully
paid and nonassessable.
2. With respect to the Rights, assuming (a) the taking by the Board of
Directors of the Company of all necessary corporate action to authorize and
approve the issuance of the Rights and the Common Stock relating to the
Rights and (b) the due issuance and delivery of the Rights and Common Stock
relating to the Rights, upon payment of the consideration therefor in
accordance with the applicable definitive purchase, underwriting or similar
agreement approved by the Board of Directors of the Company, and otherwise
in accordance with the provisions of the Rights Agreement, the Rights will
constitute valid and legally binding obligations of the Company enforceable
against the Company in accordance with their terms.
3. With respect to the Preferred Stock, assuming (a) the taking by the
Board of Directors of the Company of all necessary corporate action to
authorize and approve the issuance of the Preferred Stock, (b) the due
filing of the Certificate of Designations and (c) the due issuance and
delivery of the Preferred Stock, upon payment of the consideration therefor
in accordance with the applicable definitive purchase, underwriting or
similar agreement approved by the Board of Directors of the Company, the
Preferred Stock will be validly issued, fully paid and nonassessable.
4. With respect to the Depositary Shares, assuming (a) the taking by
the Board of Directors of the Company of all necessary corporate action to
authorize and approve the issuance of the Depositary Shares, (b) the due
filing of the Certificate of Designations and (c) the due issuance and
delivery of the Depositary Shares, upon payment of the consideration
therefor in accordance with the applicable definitive purchase,
underwriting or similar agreement approved by the Board of the Directors of
the Company and otherwise in accordance with the provisions of the Deposit
Agreement, the Depositary Shares will be validly issued, fully paid and
nonassessable.
5. With respect to the Debt Securities, assuming (a) the taking by the
Board of Directors of the Company, a duly constituted and acting committee
of such Board of Directors or duly authorized officers of the Company (such
Board of Directors, committee or authorized officers being referred to
herein as the "Board") of all necessary corporate action to authorize and
approve the issuance and terms of the Debt Securities, the terms of the
offering thereof and related matters and (b) the due execution,
authentication, issuance and delivery of such Debt Securities, upon payment
of the consideration therefor provided for in the applicable definitive
purchase, underwriting or similar agreement approved by the Board and
otherwise in accordance with the provisions of the Indenture and the
applicable Supplemental Indenture and such agreement, the Debt Securities
will constitute valid and legally binding obligations of the Company
enforceable against the Company in accordance with their terms.
6. With respect to the Stock Purchase Contracts, assuming (a) the
taking by the Board of Directors of the Company of all necessary corporate
action to authorize and approve the execution and delivery of the Stock
Purchase Contract Agreement and (b) the due execution, issuance and
delivery of the Stock Purchase Contracts, upon payment of the consideration
therefor or provided for in the applicable definitive
<PAGE>
POLAROID CORPORATION -7- February 2, 2000
purchase, underwriting or similar agreement approved by the Board and
otherwise in accordance with the provisions of the applicable Stock
Purchase Contract Agreement and such agreement, the Stock Purchase
Contracts will constitute valid and legally binding obligations of the
Company enforceable against the Company in accordance with their terms.
7. With respect to the Stock Purchase Units, assuming (a) the taking
by the Board of Directors of the Company of all necessary corporate action
to authorize and approve (i) the issuance and terms of the Stock Purchase
Units, (ii) the execution and delivery of the Stock Purchase Contract
Agreement with respect to the Stock Purchase Contracts which are a
component of the Stock Purchase Units and (iii) the issuance and terms of
the shares of Preferred Stock, the Depositary Shares or the Debt
Securities, each of which may be a component of the Stock Purchase Units,
the terms of the offering thereof and related matters, (b) the due filing
of the Certificate of Designations with respect to the Preferred Stock or
the Depositary Shares, as applicable, which may be a component of the Stock
Purchase units, and (c) the due execution, authentication, in the case of
such Debt Securities, issuance and delivery of (i) the Stock Purchase
Units, (ii) such Stock Purchase Contracts and (iii) any of such shares of
Preferred Stocks, Depositary Shares, Debt Securities or Debt Obligations,
each of which may be a component of the Stock Purchase Unit, upon the
payment of the consideration therefor provided for in the applicable
definitive purchase, underwriting or similar agreement approved by the
Board of Directors of the Company and otherwise in accordance with the
provisions of the definitive Stock Purchase Contract Agreement, in the case
of such Stock Purchase Contracts, the definitive deposit agreement, in the
case of such Depositary Shares, and the Indenture and the Supplemental
Indenture, in the case of such Debt Securities and such agreement, the
Stock Purchase Units will constitute valid and legally binding obligations
of the Company, enforceable against the Company in accordance with their
terms.
8. With respect to the Securities Warrants, assuming (a) the taking by
the Board of Directors of the Company of all necessary corporate action, or
in the case of Debt Securities Warrants, the Board, to authorize and
approve the execution and delivery of the related Warrant Agreement and (b)
the due execution, countersignature, issuance and delivery of such
Securities Warrants, upon payment of the consideration therefor provided
for in the applicable definitive purchase, underwriting or similar
agreement approved by the Board or, in the case of Debt Securities
Warrants, by the Board and otherwise in accordance with the provisions of
the applicable Warrant Agreement and such agreement, the Securities
Warrants will constitute valid and legally binding obligations of the
Company enforceable against the Company in accordance with their terms.
9. With respect to the Warrant Units, assuming (a) the taking by the
Board of Directors of the Company of all necessary corporate action to
authorize and approve (i) the issuance and terms of the Warrant Units, (ii)
the execution and delivery of the Warrant Agreement with respect to the
Securities Warrants which are a component of the
<PAGE>
POLAROID CORPORATION -8- February 2, 2000
Warrant Units and (iii) the issuance and terms of the shares of Preferred
Stock, the Depositary Shares or the Debt Securities, each of which may be a
component of the Warrant Units, the terms of the offering thereof and
related matters, (b) the due filing of the Certificate of Designations with
respect to the Preferred Stock or the Depositary Shares, as applicable, and
(c) the due execution, authentication, in the case of such Debt Securities,
issuance and delivery of (i) Warrant Units, (ii) such Securities Warrants,
(iii) such shares of Preferred Stock, (iv) such Depositary Shares and (v)
such Debt Securities, in each case upon the payment of the consideration
therefor provided for in the applicable definitive purchase, underwriting
or similar agreement approved by the Board of Directors and otherwise in
accordance with the provisions of the applicable Warrant Agreement, the
applicable deposit agreement, in the case of such Depositary Shares, and
the Indenture and the Supplemental Indenture, in the case of such Debt
Securities and such agreement, the Warrant Units will constitute valid and
legally binding obligations of the Company, enforceable against the Company
in accordance with their terms.
Our opinions set forth in paragraphs 2 and 5 through 9 above are
subject to the effects of (i) bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, (ii) general equitable principles (whether
considered in a proceeding in equity or at law) and (iii) an implied covenant of
good faith and fair dealing.
We are members of the Bar of the State of New York, and we do not
express any opinion herein concerning any law other than the law of the State of
New York, the Federal law of the United States and the Delaware General
Corporation Law.
We hereby consent to the filing of this opinion letter as Exhibit 5 to
the Second Registration Statement and to the use of our name under the caption
"Legal Opinions" in the Prospectus included in the Second Registration
Statement.
Very truly yours,
/s/ SIMPSON THACHER & BARTLETT
SIMPSON THACHER & BARTLETT
<PAGE>
The Board of Directors
Polaroid Corporation
Ladies and Gentleman:
Re: Registration statement on Form S-3 of Polaroid Corporation.
With respect to the subject registration statement, we acknowledge our
awareness of the use therein of our reports dated April 14, 1999, July 13,
1999 and October 12, 1999, related to our review of interim financial
information.
Pursuant to Rule 436 (c) under the Securities Act of 1933, such reports are
not considered part of a registration statement prepared or certified by an
accountant or a report prepared or certified by an accountant within the
meaning of Sections 7 and 11 of the Act.
Very truly yours,
/s/ KPMG LLP
Boston, Massachusetts
February 2, 2000
<PAGE>
Exhibit 23.1
The Board of Directors
Polaroid Corporation
We consent to the use in the registration statement of Polaroid Corporation,
of our audit reports dated January 20, 1999, except for Note 8 to which the
date is February 17, 1999, on the consolidated financial statements and
schedules of Polaroid Corporation and subsidiary companies as of December 31,
1998 and 1997, and for each of the years in the three-year period ended
December 31, 1998 incorporated herein by reference and to the reference to
our firm under the heading "Experts" in the prospectus which forms a part of
such registration statement.
As discussed in Note 1 to the consolidated financial statements, in 1997,
Polaroid Corporation changed its method of accounting for depreciation.
/s/ KPMG LLP
Boston, Massachusetts
February 2, 2000
