SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): June 20, 1995
---------------
FORD HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
0-18263 38-2890269
- ------------------------ ---------------------------------
(Commission File Number) (IRS Employer Identification No.)
The American Road, Dearborn, Michigan 48121
- --------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 313-322-3000
------------
<PAGE>
Item 5. Other Events.
Pursuant to Registration Statement No. 33-56747, Ford
Holdings, Inc., a Delaware corporation (the "Company"),
registered under the Securities Act of 1933, as amended (the
"Act"), 5,000 shares of preferred stock and related depositary
shares. The preferred stock and depositary shares were
registered on Form S-3 to be offered on a delayed or continuous
basis pursuant to Rule 415 under the Act. In connection
therewith, the Company has created two series of preferred stock
designated as its Flexible Rate Auction Preferred Stock - Series
O ("Series O Preferred") and Flexible Rate Auction Preferred
Stock - Series P ("Series P Preferred" and, together with Series
O Preferred, the "Preferred Stock"), by the adoption on June 20,
1995 by a committee of the Board of Directors of the Company of
the Certificate of Designations of the Preferred Stock (the
"Certificate of Designations") and the filing thereof with the
Delaware Secretary of State on June 22, 1995. The Certificate of
Designations is filed as an exhibit to this Report.
The Company entered into an underwriting agreement and a
pricing agreement each dated June 20, 1995 with Merrill Lynch &
Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Goldman,
Sachs & Co. and Lehman Brothers Inc. for the sale of 1000 shares
of the Preferred Stock, consisting of 500 shares of Series O
Preferred and 500 shares of Series P Preferred. In connection
therewith, the Company entered into an Auction Agent Agreement
with The Bank of New York dated June 23, 1995 (the "Auction Agent
Agreement"), appointing The Bank of New York as the auction agent
of the Company to implement auction procedures in respect of the
Preferred Stock. It also provides for the issuance by the
Company of one certificate with respect to each series of
Preferred Stock. The Auction Agent Agreement and the form of the
stock certificate for the Preferred Stock are filed as exhibits
to this Report.
Pursuant to the Auction Agent Agreement, The Bank of New
York, as Auction Agent, has entered and may in the future enter
into Broker-Dealer Agreements with assorted broker-dealers (each
a "Broker-Dealer Agreement"). The form of the Broker-Dealer
Agreement is filed as an exhibit to this Report.
The Company also entered into a Term Selection Agent
Agreement dated June 23, 1995 with Merrill Lynch & Co., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Goldman, Sachs & Co.
and Lehman Brothers Inc. (the "Term Selection Agent Agreement")
whereby Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, Goldman, Sachs & Co. and Lehman Brothers Inc.
were appointed as term selection agents of the Company for the
purpose of establishing dividend periods in respect of the
Preferred Stock. The Term Selection Agent Agreement is filed as
an exhibit to this Report.
<PAGE>
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits.
EXHIBITS
<TABLE>
<CAPTION>
Designation Description Method of Filing
- ----------- ----------- ----------------
<S> <C> <C>
Exhibit 4.1 Certificate of Designations of the Included as part
Flexible Rate Auction Preferred of Exhibit 4.3 of
Stock - Series O and Series P this Report
of Ford Holdings, Inc.
Exhibit 4.2 Form of Stock Certificate for the Filed with
Flexible Rate Auction Preferred this report
Stock - Series O and Series P
of Ford Holdings, Inc.
Exhibit 4.3 Auction Agent Agreement dated June Filed with
23, 1995 between Ford Holdings, Inc. this Report
and The Bank of New York
Exhibit 4.4 Form of Broker-Dealer Agreement Included as part
between The Bank of New York and of Exhibit 4.3 of
broker-dealers this Report
Exhibit 4.5 Term Selection Agent Agreement Filed with
dated June 23, 1995 among Ford this Report
Holdings, Inc., Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Goldman, Sachs & Co.
and Lehman Brothers Inc.
</TABLE>
SIGNATURE
---------
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this Report to be signed on
its behalf by the undersigned thereunto duly authorized on the
date indicated.
FORD HOLDINGS, INC.
Date: July 25, 1995 By: /s/ Peter Sherry, Jr.
----------------------------
Peter Sherry, Jr.
Assistant Secretary
<PAGE>
EXHIBIT INDEX
-------------
Designation Description Page
- ----------- ---------------------------------- ----
Exhibit 4.1 Certificate of Designations of the
Flexible Rate Auction Preferred
Stock - Series O and Series P
of Ford Holdings, Inc.
Exhibit 4.2 Form of Stock Certificate for the
Flexible Rate Auction Preferred
Stock - Series O and Series P
of Ford Holdings, Inc.
Exhibit 4.3 Auction Agent Agreement dated June
23, 1995 between Ford Holdings, Inc.
and The Bank of New York
Exhibit 4.4 Form of Broker-Dealer Agreement
between The Bank of New York and
broker-dealers
Exhibit 4.5 Term Selection Agent Agreement
dated June 23, 1995 among Ford
Holdings, Inc., Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Goldman, Sachs & Co.
and Lehman Brothers Inc.
Exhibit 4.2
-----------
[Form of Face of Preferred Stock Certificate]
THIS IS A GLOBAL CERTIFICATE REPRESENTING ALL OF THE SHARES OF THIS
SERIES, AND THE BENEFICIAL OWNERS OF THE SHARES ARE
NOT ENTITLED TO RECEIVE ANY CERTIFICATE REPRESENTING SHARES
BENEFICIALLY OWNED BY THEM.
01
------- ---------
Number Shares
INCORPORATED UNDER THE SEE REVERSE FOR CERTAIN
LAWS OF THE STATE OF DELAWARE DEFINITIONS
FORD HOLDINGS, INC.
CUSIP:
Flexible Rate Auction Preferred
Stock--Series [O][P] (Liquidation Preference
$100,000 Per Share)
This certifies that
CEDE & CO.
is the owner of ***
Fully Paid and Non-Assessable Shares of Flexible Rate Auction
Preferred Stock--Series [O][P]
of Ford Holdings, Inc. (the "Company") transferable on the books of
the Company only by the registered holder hereof, in person or by
a 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 Company's Certificate of Incorporation, as
amended, and to the provisions of certain Resolutions of the Board
of Directors of the Company, copies of which are set forth in
Certificates of Designations, filed in the office of the Secretary
of the State of Delaware with respect to each class of Preferred
Stock of the Company, to all of which the holder by acceptance
hereof assents. Copies of such certificates are also on file with
the Company.
WITNESS the signatures of the duly
authorized officers of the Company.
COUNTERSIGNED:
By: THE BANK OF NEW YORK ASSISTANT SECRETARY
AUCTION AGENT, TRANSFER
AGENT AND REGISTRAR
VICE PRESIDENT - CONTROLLER
AUTHORIZED OFFICER DATED: June 23, 1995
<PAGE>
[Form of Reverse of Preferred Stock Certificate]
FORD HOLDINGS, INC.
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>
<CAPTION>
<S> <C>
TEN COM - as tenants in common UNIF GIFT MIN ACT -....Custodian...
(Cust) (Minor)
TEN ENT - as tenants by the entireties under Uniform Gifts to Minors
JT TEN - as joint tenants with right
of survivorship and not as Act...................
tenants in common (State)
</table)
Additional abbreviations may also be
used though not in the above list.
---------------------------
The Company will furnish without charge to each stockholder who
so requests, the powers, designations, preferences and relative,
participating, optional or other special rights of each class of
stock or series thereof of the Company and the qualifications,
limitations or restrictions of such preferences and/or rights.
Such request may be made to the Company or to the Auction Agent.
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 OF ASSIGNEE
_________________________________________________________________
_________________________________________________________________
_________________________________ 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 named
corporation with full power of substitution in the premises.
Dated: ___________________
_________________________
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.
</TABLE>
EXHIBIT 4.3
-----------
__________________________________________________________
AUCTION AGENT AGREEMENT
Between
FORD HOLDINGS, INC.
and
THE BANK OF NEW YORK
Dated as of June 23, 1995
Relating to
FLEXIBLE RATE AUCTION PREFERRED
STOCK--SERIES O and SERIES P
of
FORD HOLDINGS, INC.
- ------------------------------------------------------
<PAGE>
AUCTION AGENT AGREEMENT, dated as of June 23, 1995, between
FORD HOLDINGS, INC., a Delaware corporation (the "Company"), and
THE BANK OF NEW YORK, a New York banking corporation (the
"Auction Agent").
The Company proposes to issue 1,000 shares of its Flexible
Rate Auction Preferred Stock in Series O and P (collectively, the
"Auction Preferred") pursuant to the Certificate of Designations
creating and establishing the Auction Preferred and amending its
Certificate of Incorporation. The Company desires that the
Auction Agent perform certain duties in connection with each
series of the Auction Preferred upon the terms and conditions of
this Agreement and hereby appoints the Auction Agent to act in
the capacities set forth in this Agreement.
NOW THEREFORE, in consideration of the premises and the
mutual covenants contained herein, the Company and the Auction
Agent agree as follows:
ARTICLE I
DEFINITIONS AND RULES OF CONSTRUCTION
Section 1.1. Terms Defined by Reference to Certificate of
Designations. Capitalized terms not defined herein shall have
the respective meanings specified in the Certificate of
Designations.
Section 1.2. Terms Defined Herein. As used herein and in
the Settlement Procedures, the following terms shall have the
following meanings, unless the context otherwise requires:
"Affiliate" shall mean any Person controlled by, in
control of, or under common control with the Company.
"Agent Member" of any Person shall mean a member of, or
participant in, the Securities Depository that will act on
behalf of such Person and is identified as such in such
Person's Purchaser's Letter.
"Auction" shall have the meaning specified in Section
2.1 hereof.
"Auction Preferred" shall have the meaning set forth in
the preamble to this Agreement.
"Auction Procedures" shall mean the Auction Procedures
that are set forth in paragraph 8 of the Certificate of
Designations.
<PAGE>
2
"Authorized Officer" shall mean each Senior Vice
President, Vice President, Assistant Vice President and
Assistant Treasurer of the Auction Agent assigned to its
Corporate Trust Department and every other officer or
employee of the Auction Agent designated as an "Authorized
Officer" for purposes of this Agreement in a communication
to the Company.
"Broker-Dealer Agreement" shall mean each agreement
between the Auction Agent and a Broker-Dealer substantially
in the form attached hereto as Exhibit A.
"Certificate of Designations" shall mean the
Certificate of Designations creating and establishing the
Auction Preferred and amending the Certificate of
Incorporation of the Company as filed by the Company in the
office of the Secretary of State of the State of Delaware
on June 22, 1995, a copy of which is attached hereto as
Exhibit B.
"Company Officer" shall mean the Chairman of the Board
of Directors, the President, each Vice President (whether
or not designated by a number or word or words added before
or after the title "Vice President"), the Secretary, the
Treasurer, each Assistant Secretary and each Assistant
Treasurer of the Company and every other officer or
employee of the Company designated as a "Company Officer"
for purposes hereof in a notice to the Auction Agent.
"Date of Original Issue" means the date on which the
Company originally issues shares of Auction Preferred.
"Holder" shall mean the holder of shares of Auction
Preferred, as his name appears on the Stock Books of the
Company.
"Order" shall have the meaning assigned to such term in
paragraph 8(b)(i) of the Certificate of Designations and,
for the purposes hereof, shall be substantially in the form
attached as Exhibit D to the Broker-Dealer Agreement.
"Permitted Investments" shall mean Ford Motor Credit
Company Commercial paper or The Bank of New York Deposit
Reserve.
"Purchaser's Letter" shall mean a purchaser's letter
substantially in the form attached hereto as Exhibit C.
"Settlement Procedures" shall mean the Settlement
Procedures attached hereto as Exhibit D.
<PAGE>
3
Section 1.3. Rules of Construction. Unless the context or
use indicates another or different meaning or intent, the
following rules shall apply to the construction of this
Agreement:
(a) Words importing the singular number shall include
the plural number and vice versa.
(b) The captions and headings herein are solely for
convenience of reference and shall not constitute a part of
this Agreement nor shall they affect the meaning,
construction or effect of any provision of this Agreement.
(c) The words "hereof," "herein," "hereto" and other
words of similar import refer to this Agreement as a whole.
(d) All references herein to a particular time of day
shall be to New York City time.
ARTICLE II
THE AUCTION
Section 2.1. Purpose; Incorporation by Reference of
Auction Procedures and Settlement Procedures. (a) The
Certificate of Designations provides that the Applicable Rate on
the shares of each series of the Auction Preferred for each
Dividend Period for such series after the initial Dividend Period
therefor shall, except under certain circumstances, be the rate
per annum that a bank or trust company appointed by the Company
advises results from the implementation of the Auction
Procedures. The Board of Directors of the Company has adopted a
resolution appointing the Auction Agent to implement the Auction
Procedures and to act as paying agent. The Auction Agent accepts
such appointment and agrees to follow the procedures set forth in
this Article II and the Auction Procedures for the purpose of
determining the Applicable Rate for each series of the Auction
Preferred. Each periodic operation of such procedures is
hereinafter referred to as an "Auction."
(b) All of the provisions contained in the Auction
Procedures and the Settlement Procedures are incorporated herein
by reference in their entirety and shall be deemed to be a part
hereof to the same extent as if such provisions were fully set
forth herein. In the event of any inconsistency between the
provisions hereof and the provisions of the Certificate of
Designations, the provisions of the Certificate of Designations
shall control.
Section 2.2. Preparation for Each Auction; Maintenance
of Registry of Beneficial Owners. (a) Not later than the Date
of Original Issue, the Company shall provide the Auction Agent
<PAGE>
4
with a list of the Broker-Dealers and a manually signed copy of
each Broker-Dealer Agreement. The Auction Agent shall keep such
list current and accurate and shall indicate thereon, or on a
separate list, the identity of each Existing Holder, if any,
whose most recent Order was submitted by a Broker-Dealer on such
list and resulted in such Existing Holder continuing to hold or
purchasing shares of Auction Preferred. Not later than seven
days prior to any Auction Date for any series of Auction
Preferred for which any change in such list of Broker-Dealers is
to be effective, the Company shall notify the Auction Agent in
writing of such change and, if any such change is the addition of
a Broker-Dealer to such list, shall cause to be delivered to the
Auction Agent for execution by the Auction Agent, a Broker-Dealer
Agreement manually signed by such Broker-Dealer. The Auction
Agent shall have entered into a Broker-Dealer Agreement with a
Broker-Dealer prior to the participation of such Broker-Dealer in
any Auction.
(b) In the event that the Auction Date for any Auction
for the Auction Preferred shall be changed after the Auction
Agent has given the notice pursuant to clause (vii) of paragraph
(a) of the Settlement Procedures for the Auction Preferred, or
after the Term Selection Agent has delivered a Notice of
Long-Term Dividend Period (as defined in Section 2.5(a) hereof),
the Auction Agent, by such means as the Auction Agent deems
practicable, shall give notice of such change to the
Broker-Dealers no later than the earlier of 9:15 a.m on the new
Auction Date and 9:15 a.m. on the old Auction Date.
(c) If the number of days comprising a Short-Term
Dividend Period is increased as provided in paragraph 3(b)(v) of
the Certificate of Designations as a result of a change in the
Minimum Holding Period, not later than 21 days prior to the first
day of the Dividend Period preceding the first Dividend Period
for any series of the Auction Preferred for which such change is
to be effective, the Company shall provide the Auction Agent with
a form of notice of such change to be sent to Existing Holders by
Broker-Dealers pursuant to Section 2.4(c) of the Broker-Dealer
Agreements. The Auction Agent shall promptly provide each
Broker-Dealer with such form of notice after receipt thereof from
the Company.
(d) (i) On each Auction Date (A) for any series of
Auction Preferred with respect to which the Dividend Period
following such Auction Date will be a Short-Term Dividend Period,
the Auction Agent shall determine the 60-day "AA" Composite
Commercial Paper Rate, and (B) for any series of Auction
Preferred with respect to which the Dividend Period following
such Auction Date will be a Long-Term Dividend Period, the
Auction Agent shall determine the Reference Rate and, in each
case, the Maximum Applicable Rate. If the 60-day "AA" Composite
Commercial Paper Rate or the Reference Rate is not quoted on an
<PAGE>
5
interest basis but is quoted on a discount basis, the Auction
Agent shall convert the quoted rate to the interest equivalent
thereof as set forth in the respective definition in the case of
the 60-day "AA" Composite Commercial Paper Rate, the Applicable
"AA" Composite Commercial Paper Rate or the Applicable Treasury
Rate as set forth in the Certificate of Designations. If the
rate obtained by the Auction Agent is quoted on another basis,
the Auction Agent shall convert such quoted rate to its interest
equivalent after consultation with the Company as to the method
of such conversion. On the date of this Agreement, the
Applicable Percentage to be used for purposes of calculating the
Maximum Applicable Rate is 200%. If there is any change in the
credit rating of the Auction Preferred resulting in a change in
the Applicable Percentage, the Company shall notify the Auction
Agent in writing of such change in such credit rating and
Applicable Percentage prior to 12:00 noon on the Business Day
prior to the next Auction Date for any series of Auction
Preferred. In determining the Maximum Applicable Rate for any
series of Auction Preferred on any Auction Date, the Auction
Agent may rely on the last Applicable Percentage of which it has
received notice from the Company (or, in the absence of such
notice, the percentage set forth in the second preceding
sentence). Not later than 9:30 a.m. on each Auction Date the
Auction Agent shall notify the Company and the Broker-Dealers of
the 60-day "AA" Composite Commercial Paper Rate or the Reference
Rate, as the case may be, and the Maximum Applicable Rate.
(ii) If the 60-day "AA" Composite Commercial Paper
Rate or the Applicable "AA" Composite Commercial Paper Rate is to
be based on rates supplied by the Commercial Paper Dealers, and
one or more of the Commercial Paper Dealers shall fail to provide
a quotation or quotations for the determination of the 60-day
"AA" Composite Commercial Paper Rate or the Applicable "AA"
Composite Commercial Paper Rate, the Auction Agent shall
immediately notify the Company so that the Company can determine
whether to select a Substitute Commercial Paper Dealer or
Substitute Commercial Paper Dealers to provide the quotation or
quotations not being supplied by such Commercial Paper Dealer or
Commercial Paper Dealers. The Company shall promptly advise the
Auction Agent of any such selection.
(iii) If the Applicable Treasury Rate is to be based
on rates supplied by U.S. Government Securities Dealers and one
or more of the U.S. Government Securities Dealers shall not
provide a quotation for the determination of such Applicable
Treasury Rate, the Auction Agent shall immediately notify the
Company so that the Company can determine whether to select a
Substitute U.S. Government Securities Dealer or Substitute U.S.
Government Securities Dealers to provide the quotation or
quotations not being supplied by any U.S. Government Securities
Dealer or U.S. Government Securities Dealers. The Company shall
promptly advise the Auction Agent of any such selection.
<PAGE>
6
(iv) In the event a Failure to Deposit occurs prior to
the beginning of a Dividend Period, the Auction Agent shall
determine LIBOR for the first day of each Dividend Period for
which the Applicable Rate is 200% of LIBOR until Auctions are
resumed and in the event a Failure to Deposit occurs during a
Long-Term Dividend Period, the Auction Agent shall determine
LIBOR for the day on which such Failure to Deposit occurs.
(v) If one or more of the Reference Banks shall not
provide a quotation for the determination of LIBOR, the Auction
Agent shall immediately notify the Company so that the Company
can determine whether to select a Substitute Reference Bank or
Substitute Reference Banks to provide the quotation or quotations
not being supplied by any Reference Bank or Reference Banks. The
Company shall promptly advise the Auction Agent of any such
selection.
(e) (i) The Auction Agent shall maintain a registry
of the Existing Holders of the shares of each series of the
Auction Preferred, who shall constitute Existing Holders for
purposes of Auctions for such series and shall indicate therein
the identity of each Existing Holder, if any, on whose behalf
each Broker-Dealer submitted the most recent Order in any Auction
that resulted in such Existing Holder's continuing to hold or
purchasing shares of such series of the Auction Preferred of such
series. Each Broker-Dealer shall provide the Auction Agent (not
later than the Date of Original Issue) with a list of the initial
Existing Holders of the shares of each series of Auction
Preferred and the respective Broker-Dealer of each such Existing
Holder through which such Existing Holder purchased such shares
of Auction Preferred. The Auction Agent shall use reasonable
efforts to keep such registry current and accurate. The Auction
Agent may rely upon, as evidence of the identities of the
Existing Holders, such list, the results of Auctions and notices
from the Broker-Dealer of each such Existing Holder with respect
to such Existing Holder's transfer of shares of the Auction
Preferred to another Person. Except as permitted by this Section
and Sections 2.2(f), 2.8 and 4.6, the Auction Agent shall not
disclose this information to any other Person.
(ii) The Auction Agent shall be required to register a
transfer of shares of the Auction Preferred from an Existing
Holder to another Person only if such transfer is made to a
Person that has delivered or caused to be delivered a signed
Purchaser's Letter to the Auction Agent and if (A) such transfer
is pursuant to an Auction or (B) the Auction Agent has been
notified in writing (I) in a notice substantially in the form of
Exhibit E to the Broker-Dealer Agreements by such Existing Holder
or the Broker-Dealer or the Agent Member of such Existing Holder
of such transfer and (II) in a notice substantially in the form
of Exhibit F to the Broker-Dealer Agreements by the Broker-Dealer
of any Person that purchased or sold such shares of the Auction
<PAGE>
7
Preferred in an Auction of the failure of such shares of the
Auction Preferred to be transferred as a result of such Auction.
The Auction Agent is not required to accept any such notice for
an Auction unless it is received by the Auction Agent by 3:00
p.m. on the Business Day preceding such Auction Date.
(f) The Auction Agent may request the Broker-Dealers,
as set forth in the Broker-Dealer Agreements, to provide the
Auction Agent with a list of their respective customers that such
Broker-Dealers believe are Existing Holders of shares of any
series of the Auction Preferred. The Auction Agent shall provide
the Company with a copy of such list, as it is maintained, upon
the request of the Company. The Auction Agent shall keep
confidential such registry of Existing Holders and shall not
disclose the identities of the Existing Holders to any Person
other than the Company and the Broker-Dealer that provided such
information.
(g) The Auction Agent is not required to accept the
Purchaser's Letter of any Potential Holder who wishes to submit a
Bid for the first time in an Auction or an amendment to the
Purchaser's Letter of any Potential Holder or Existing Holder who
wishes to amend its Purchaser's Letter intending that such
amendment is to take effect with respect to an Auction, unless
such Purchaser's Letter or such amendment is received by the
Auction Agent by 3:00 p.m. on the Business Day preceding the
related Auction Date.
Section 2.3. Auction Schedule. The Auction Agent
shall conduct Auctions for each series of the Auction Preferred
in accordance with the schedule set forth below. Such schedule
may be changed by the Auction Agent with the consent of the
Company, which consent shall not be unreasonably withheld. The
Auction Agent shall give written notice of any such change to
each Broker-Dealer. Such notice shall be given prior to the
close of business on the Business Day next preceding the first
Auction Date on which any such change shall be effective.
Time on Auction Date Event
- -------------------- -------------------------------------
By 9:30 a.m Auction Agent advises the Company and
Broker-Dealers of 60-Day "AA"
Composite Commercial Paper Rate or
the Reference Rate, as the case may
be, and the applicable Maximum
Applicable Rate determined pursuant
to Section 2.2(d)(i) hereof.
<PAGE>
8
Between 9:30 a.m. and Auction Agent assembles
12:30 p.m. information communicated to it by
Broker-Dealers as provided in
paragraph 8(c) of the Certificate of
Designations. Submission Deadline is
12:30 p.m.
Not earlier than Auction Agent makes determinations
12:30 p.m. pursuant to paragraph 8(d)(i) of the
Certificate of Designations.
By approximately 3:00 p.m. Auction Agent advises Company of
results of Auction (including the
term of the next succeeding Dividend
Period) as provided in paragraph
8(d)(ii) of the Certificate of
Designations.
Submitted Bids and Submitted Sell
Orders are accepted and rejected and
shares of the applicable series of
the Auction Preferred allocated as
provided in paragraph 8(e) of the
Certificate of Designations.
Auction Agent gives notice of Auction
results as set forth in Section 2.4
hereof.
Section 2.4. Notice of Auction Results and Exchanges.
The Auction Agent shall follow the notification procedures set
forth in paragraph (a) of the Settlement Procedures.
Section 2.5. Changes in Dividend Period. (a)
Paragraph 3(b)(viii) of the Certificate of Designations provides
that the Term Selection Agent may, except as set forth in the
proviso below, at its option, on or prior to the fifth day but no
more than 20 days prior to an Auction Date for any series of
Auction Preferred, by telephonic and written notice (a "Notice of
a Long-Term Dividend Period") to the Company, the Auction Agent,
the Paying Agent and the Securities Depository, substantially in
the form of Exhibit E hereto, specify that the next succeeding
Dividend Period for such series of Auction Preferred is a
Long-Term Dividend Period, provided that the Term Selection Agent
may not give a Notice of Long-Term Dividend Period for such
series of Auction Preferred (and any such Notice shall be null
and void) unless Sufficient Clearing Bids were made in the last
occurring Auction for such series of Auction Preferred and full
cumulative dividends for all series of Auction Preferred and
Flexible Rate Auction Preferred Stock payable prior to such date
have been paid in full.
<PAGE>
9
(b) Paragraph 3(b)(viii) of the Certificate of Designations
provides that the Dividend Period following each Auction for any
series of Auction Preferred shall be a Short-Term Dividend Period
(i) if the Term Selection Agent does not give a Notice of
Long-Term Dividend Period with respect to the next succeeding
Dividend Period for any Series of Auction Preferred in a timely
manner, (ii) if, in the event the Term Selection Agent has given
a Notice of Long-Term Dividend Period with respect to the next
succeeding Dividend Period for any series of Auction Preferred,
the Term Selection Agent gives a Notice of Revocation, (iii) if,
in the event the Term Selection Agent has given a Notice of
Long-Term Dividend Period with respect to the next succeeding
Dividend Period for any series of Auction Preferred, the Company
removes the Term Selection Agent by giving a Notice of Removal or
(iv) Sufficient Clearing Bids are not made in the related Auction
for such series or such Auction is not held for any reason.
(c) Paragraph 8(d)(ii)(B) of the Certificate of
Designations provides that if Sufficient Clearing Bids are not
made at any Auction for any series of Auction Preferred with
respect to which the Term Selection Agent has given a Notice of
Long-Term Dividend Period (and such notice was not revoked or
deemed to be revoked), the Applicable Rate for the Dividend
Period following such Auction and for each subsequent Dividend
Period until the first Dividend Period following an Auction for
such series of Auction Preferred at which Sufficient Clearing
Bids are made shall be the greatest of (i) the Applicable Rate
for such series of Auction Preferred in effect immediately prior
to such Auction, (ii) the Maximum Applicable Rate for a
Short-Term Dividend Period or (iii) the Maximum Applicable Rate
on the Auction Date for the specified Long-Term Dividend Period.
(d) Paragraph 3(b)(viii) of the Certificate of
Designations provides that any Notice of Long-Term Dividend
Period may be revoked by the Term Selection Agent on or prior to
the second Business Day prior to the related Auction by
telephonic and written notice, substantially in the form of
Exhibit F hereto (a "Notice of Revocation"), to the Company, the
Auction Agent, the Paying Agent and the Securities Depository.
(e) Paragraph 3(b)(viii) of the Certificate of
Designations provides that any Notice of Long-Term Dividend
Period shall be deemed to be revoked if the Company shall remove
the Term Selection Agent by giving telephonic and written notice,
substantially in the form of Exhibit G hereto (a "Notice of
Removal") on or prior to the second Business Day prior to the
related Auction to the Auction Agent, the Paying Agent and the
Securities Depository.
(f) Promptly after receipt of a Notice of a Long-Term
Dividend Period, Notice of Revocation or Notice of Removal, the
Auction Agent shall promptly deliver a copy of such notice by
<PAGE>
10
hand delivery or telecopier to each Existing Holder of shares of
such series at the address or telecopier number specified in such
Existing Holder's Purchaser's Letter and to the Broker-Dealers.
The Auction Agent shall also promptly use its best efforts to
advise each Broker-Dealer by telephone of the receipt of such
notice.
Section 2.6. Broker-Dealers. (a) Not later than
12:00 noon on the Auction Date for any series of the Auction
Preferred, the Company shall pay to the Auction Agent an amount
in cash equal to (i) if the next succeeding Dividend Period for
such series is a Short-Term Dividend Period the product of (A) a
fraction, the numerator of which is the number of days in such
Dividend Period (calculated by counting the first day of such
Dividend Period but excluding the last day thereof) and the
denominator of which is 360 times (B) 1/4 of 1% times
(C) $100,000 times (D) the aggregate number of shares of Auction
Preferred in such series or (ii) if the next succeeding Dividend
Period for such series is a Long-Term Dividend Period, the
product of (A) such percentage as agreed to from time to time by
the Company and the Term Selection Agent (the "Long-Term
Percentage") times (B) $100,000 times (C) the aggregate number of
shares of Auction Preferred in such series. The Company shall
notify the Auction Agent of the amount of the Long-Term
Percentage. The Auction Agent shall advise the Company of the
amount referred to in the first sentence of this Section 2.6(a)
in respect of such Dividend Period not later than 4:00 p.m. on
the second Business Day preceding the Auction Date with respect
to such Dividend Period. In the event that the Company does not
pay the Auction Agent the full amount determined pursuant to this
Section 2.6(a) by 12:00 noon on the Auction Date, the Auction
Agent shall immediately advise the Company of the amount of any
deficiency. Prior to the applications of funds deposited
pursuant to this Section 2.6(a), the Company may direct the
Auction Agent to invest such funds in the manner set forth in
Section 3.1. Until further directed to the contrary, the Company
hereby directs the Auction Agent to so invest such funds. The
Auction Agent shall apply such moneys as set forth in Section 2.5
of the Broker-Dealer Agreements. To the extent that any such
moneys are not payable to a Broker-Dealer because Sufficient
Clearing Bids were not made in the relevant Auction and shares of
such series of the Auction Preferred therefore continued to be
held despite being subject to a Submitted Sell Order, the Auction
Agent shall repay such moneys to the Company.
(b) The Auction Agent shall terminate any
Broker-Dealer Agreement as set forth therein if so directed by
the Company in writing.
(c) The Auction Agent shall from time to time enter
into such Broker-Dealer Agreements only as the Company shall
request.
<PAGE>
11
(d) The Auction Agent shall maintain a list of
Broker-Dealers.
Section 2.7. Ownership of Shares of the Auction
Preferred and Submission of Bids by Company and Affiliates. The
Company shall notify the Auction Agent if the Company or any
Affiliate acquires any shares of the Auction Preferred. Neither
the Company nor any Affiliate shall submit any Order in any
Auction. Any Broker-Dealer that is an Affiliate of the Company
may submit Orders in an Auction but only if such Orders are not
for its own account, except that if any such affiliated
Broker-Dealer holds shares of the Auction Preferred for its own
account, it must submit a Sell Order in the next Auction with
respect to such shares of the Auction Preferred. The Auction
Agent shall have no duty or liability with respect to the
enforcement of this Section 2.7.
Section 2.8. Access to and Maintenance of Auction
Records. The Auction Agent shall upon written request afford to
the Company and its agents, independent public accountants and
legal counsel access at reasonable times during normal business
hours to all books, records, documents and other information
concerning the conduct and results of Auctions. For purposes of
the preceding sentence, the parties hereto acknowledge that
Broker-Dealers shall not be deemed agents of the Company. The
Auction Agent shall maintain records relating to any Auction for
a period of two years after such Auction (unless requested by the
Company to maintain such records for a longer period not in
excess of six years, then for such longer period), and such
records shall, in reasonable detail, accurately and fairly
reflect the actions taken by the Auction Agent in connection with
such Auction.
ARTICLE III
THE AUCTION AGENT AS PAYING AGENT
Section 3.1. Company To Provide Funds for Dividends.
(a) Not later than 12:00 noon on the Business Day immediately
preceding each Dividend Payment Date with respect to which
dividends on the shares of any series of the Auction Preferred
have been declared, the Company shall irrevocably deposit with
the Auction Agent sufficient funds (available on such Dividend
Payment Date in New York City) for the payment of such dividends
and shall give the Auction Agent irrevocable instructions to
apply such funds to the payment of such dividends on such
Dividend Payment Date. The Auction Agent shall advise the
Company of the amount referred to in the preceding sentence in
respect of such Dividend Payment Date not later than 4:00 p.m. on
the third Business Day preceding such Dividend Payment Date. In
the event that the Company so does not irrevocably deposit with
<PAGE>
12
the Auction Agent sufficient funds (available on such Dividend
Payment Date in New York City) for the payment of such dividends,
the Auction Agent shall immediately advise the Company of the
amount of any deficiency.
(b) The Company may direct the Auction Agent in
writing to invest (payment only upon delivery of securities
unless such securities are in book entry form) any available
funds only in Permitted Investments, provided that the proceeds
of any such investment will be available in New York City at the
opening of business on the Dividend Payment Date. Until further
directed to the contrary, the Company hereby directs the Auction
Agent to so invest any available funds.
(c) The Auction Agent shall not be liable or
responsible for any delay in receiving the proceeds of, or any
loss, in whole or in part, incurred or resulting from, any
investment made pursuant to Section 3.1(b), such investments
being solely for the account of and at the risk of the Company.
(d) If pursuant to Section 3.1(b) the Company directs
the Auction Agent to invest in Permitted Investments and the
Auction Agent receives income on such investments, then the
Auction Agent shall (to the extent that such income is not
required to pay dividends), upon the request of the Company,
transmit such income to the Company.
(e) In the event a Failure to Deposit shall have
occurred and the Company shall have cured such Failure to Deposit
in a timely manner pursuant to paragraph 3(c)(i) of the
Certificate of Designations, the Auction Agent shall mail notice
of such cure, substantially in the form set forth in Exhibit H
hereto, to each Existing Holder of shares of Auction Preferred of
such Series at the address specified in such Existing Holder's
Purchaser's Letter and to each Broker-Dealer for such Series as
promptly as practicable after its receipt of such payment.
Section 3.2. Disbursing Dividends. The Auction Agent
shall pay to the Holders of the shares of each series of the
Auction Preferred on each Dividend Payment Date for such series,
dividends on the shares of such series of the Auction Preferred
after receipt of necessary funds from the Company with which to
make such payment. The amount of dividends for any Dividend
Period to be paid by the Auction Agent to the Holders shall be
determined as set forth in paragraph 3(c) of the Certificate of
Designations.
SECTION 3.3. Notices of Meetings of Holders of Auction
Preferred. (a) Upon written request of the Company, the Auction
Agent will mail to Holders of Auction Preferred notice of any
meeting of stockholders of the Company (such notices to be
<PAGE>
13
provided by the Company) not less than 20 days nor more than 60
days prior to the date fixed for such meeting.
(b) Paragraph 5(c) of the Certificate of Designations
provides that during any period (referred to herein as a "Default
Period") when dividend payments on any series of Auction
Preferred or Parity Preferred for such number of Dividend Periods
or portions thereof (or the equivalent thereof in the case of
Parity Preferred), which in the aggregate contain at least 540
days, shall not have been paid or declared and a sum sufficient
for the payment thereof set aside for payment, then in any such
case the number of directors of the Company shall automatically
be increased by two additional directors, and the holders of the
shares of all series of Auction Preferred and Parity Preferred
shall possess full voting powers (to the exclusion of the holders
of all other series and classes of capital stock of the Company),
voting as a single class, to elect such two directors. If any of
such conditions exist, the Auction Agent shall, upon receipt from
the Company of a Notice of Special Meeting of Holders, in
substantially the form set forth in Exhibit I hereto with
insertions completed by the Company, mail such notice to all
Holders who were holders of record at the close of business on
the date the right referred to in paragraph 5(c)(i) of the
Certificate of Designations accrued. The delivery by the Company
of such a notice to the Auction Agent shall be deemed a
representation and warranty by the Company that at least one of
such conditions exists.
The Company shall provide a temporary chairman for any
Special Meeting and the Auction Agent shall have no obligations
in connection with such meeting, except with respect to the
mailing of the Notice of Special Meeting of Holders, pursuant to
this Agreement.
ARTICLE IV
THE AUCTION AGENT AS TRANSFER AGENT AND REGISTRAR
Section 4.1. Original Issue of Stock Certificates. On
the Date of Original Issue, the Company shall issue one
certificate with respect to each series of Auction Preferred,
representing all of the shares of such series of Auction
Preferred, and each such certificate, at the request of the
Company, shall be registered in the name of Cede & Co. and
countersigned by the Auction Agent.
Section 4.2. Registration of Transfer or Exchange of
Shares. Except as otherwise provided in this Section 4.2, shares
of each series of the Auction Preferred shall be registered
solely in the name of the Securities Depository or its nominee.
If the Securities Depository shall give notice of its intention
<PAGE>
14
to resign as such, and if the Company shall not have selected a
substitute Securities Depository acceptable to the Auction Agent
prior to such resignation, then upon such resignation, the shares
of the Auction Preferred of each series shall be registered for
transfer or exchange, and new certificates shall be issued by the
Auction Agent, upon written request of the Company (indicating
the names of the designated transferees), in the name or names of
the designated transferee or transferees, upon surrender of the
old certificates in form deemed by the Auction Agent properly
endorsed for transfer with all necessary endorsers' signatures
guaranteed, in such manner and form as the Auction Agent may
require, by a guarantor reasonably believed by the Auction Agent
to be responsible, accompanied by such assurances as the Auction
Agent shall deem necessary or appropriate to evidence the
genuineness and effectiveness of each necessary endorsement and
satisfactory evidence of compliance with all applicable laws
relating to the collection of taxes or funds necessary for the
payment of such taxes.
Section 4.3. Removal of Legends. All requests for
removal of legends on certificates representing shares of the
Auction Preferred indicating restrictions on transfer shall be
accompanied by an opinion of counsel stating that such legends
may be removed and the shares represented by such certificate may
be freely transferred. Such opinion shall be delivered under
cover of a letter from a Company Officer authorizing the Auction
Agent to remove the legend on the basis of said opinion.
Section 4.4. Lost Stock Certificates. Upon written
request of the Company, the Auction Agent shall countersign and
register replacement certificates for certificates represented to
have been lost, stolen or destroyed, upon the fulfillment of such
requirements as shall be deemed appropriate by the Company and
the Auction Agent, subject at all times to provisions of law, the
Certificate of Incorporation and By-Laws of the Company governing
such matters and resolutions adopted by the Board of Directors of
the Company with respect to such matters. The Auction Agent may
countersign new certificates in exchange for and upon the
cancellation of mutilated certificates. Any request by the
Company to the Auction Agent to countersign a replacement
certificate pursuant to this Section 4.4 shall be deemed to be a
representation and warranty by the Company to the Auction Agent
that such issuance will comply with such provisions of law, the
Certificate of Incorporation and By-Laws and resolutions of the
Board of Directors of the Company. The Company agrees to provide
such additional stock certificates as may be requested by the
Auction Agent.
Section 4.5. Disposition of Cancelled Certificates;
Record Retention. In accordance with applicable rules and
regulations of the Securities and Exchange Commission, the
Auction Agent shall retain stock certificates which have been
<PAGE>
15
cancelled in transfer or in exchange and the accompanying
documentation for two calendar years. Upon the expiration of
such two-year period, the Auction Agent shall deliver to the
Company such cancelled certificates and the accompanying
documentation. The Company shall, at its expense, retain such
records for a minimum additional period of four calendar years
from the date of delivery of the records to the Company and shall
make such records available during this period at any time, or
from time to time, for reasonable periodic, special or other
examinations by representatives of the Securities and Exchange
Commission. The Company shall also undertake to furnish to the
Securities and Exchange Commission, upon demand, at either the
principal office or at any regional office, complete, correct and
current hard copies of any and all such records.
Section 4.6. Stock Books. The Auction Agent shall
maintain the Stock Books listing the Holders of the shares of
each such series of the Auction Preferred, the number of shares
held by each and the address of each. In case of any request or
demand for the inspection of the Stock Books of the Company or
any other books in the possession of the Auction Agent, the
Auction Agent shall notify the Company and secure instructions as
to permitting or refusing such inspection. The Auction Agent
reserves the right, however, to exhibit the Stock Books or other
books to any Person if it is advised by its counsel that its
failure to do so would be unlawful.
Section 4.7. Return of Funds. Any funds deposited
with the Auction Agent hereunder by the Company for any reason
that remain unpaid after six months shall be repaid to the
Company.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to the Auction
Agent that:
(a) the Company has been duly incorporated and is
existing as a corporation in good standing under the laws
of the State of Delaware and has full power to execute and
deliver this Agreement and to authorize, create and issue
the shares of each series of the Auction Preferred, and the
shares of each series of the Auction Preferred have been
duly authorized, validly issued and are fully paid and
nonassessable;
(b) this Agreement has been duly and validly
authorized, executed and delivered by the Company and,
assuming due authorization, execution and delivery by the
<PAGE>
16
Auction Agent, constitutes a legal, valid, binding and
enforceable obligation of the Company, subject, as to
enforceability, to bankruptcy, insolvency, reorganization
and other laws of general applicability relating to or
affecting creditors' rights generally and to general
equitable principles;
(c) the form of the certificate evidencing the shares
of each series of the Auction Preferred complies with all
applicable laws of the State of Delaware;
(d) no action by or before any governmental body or
authority of the United States or of any state thereof is
required in connection with the execution and delivery of
this Agreement or the issuance of the shares of each series
of the Auction Preferred, except as required by applicable
state securities laws;
(e) the execution and delivery of this Agreement, the
performance by the Company of its obligations hereunder and
the issuance and delivery of the shares of each series of
the Auction Preferred do not and will not conflict with,
violate or result in a breach of the terms, conditions or
provisions of, or constitute a default under, the
Certificate of Incorporation or the Bylaws of the Company,
any law or regulation, any order or decree of any court or
public authority having jurisdiction or any mortgage,
indenture, contract, agreement or undertaking to which the
Company is a party or by which it is bound; and
(f) no taxes are payable upon or in respect of the
execution of this Agreement or the issuance of the shares of each
series of the Auction Preferred.
ARTICLE VI
THE AUCTION AGENT
Section 6.1. Duties and Responsibilities. (a) The
Auction Agent is acting solely as agent of the Company hereunder
and owes no fiduciary duty to any other Person by reason of this
Agreement.
(b) The Auction Agent undertakes 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 Auction Agent.
(c)The Auction Agent shall have no duty or
responsibility to verify or determine the accuracy of any
document delivered to it in accordance with the terms hereunder.
<PAGE>
17
The Auction Agent shall have no duty or responsibility to enforce
the obligations of the Company to provide the Auction Agent with
any notice or document.
(d) In the absence of bad faith or negligence on its
part, the Auction Agent shall not be liable for any action taken,
suffered or omitted or for any error of judgment made by it in
the performance of its duties under this Agreement. The Auction
Agent shall not be liable for any error of judgment made in good
faith unless the Auction Agent shall have been negligent in
ascertaining the pertinent facts.
Section 6.2. Rights of the Auction Agent. (a) The
Auction Agent may rely and shall be protected in acting or
refraining from acting upon any communication authorized hereby
and upon any written instruction, notice, request, direction,
consent, report, certificate, share certificate or other
instrument, paper or document believed by it to be genuine. The
Auction Agent shall not be liable for acting upon any telephone
communication authorized hereby which the Auction Agent believes
in good faith to have been given by the Company or by a
Broker-Dealer. The Auction Agent may record by tape or otherwise
telephone communications with the Company or any of the
Broker-Dealers or both.
(b) The Auction Agent may consult with counsel, 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 reliance
thereon.
(c) The Auction Agent shall not be required to
advance, expend or risk its own funds or otherwise incur or
become exposed to financial liability in the performance of its
duties hereunder.
(d) The Auction Agent may perform its duties and
exercise its rights hereunder either directly or by or through
agents or attorneys.
Section 6.3. Auction Agent's Disclaimer. The Auction
Agent makes no representation as to the correctness of the
recitals in or the validity or adequacy of this Agreement, the
Broker-Dealer Agreements or the shares of the Auction Preferred.
Section 6.4. Compensation, Expenses and
Indemnification. (a) The Company shall pay to the Auction Agent
such compensation in respect of its services hereunder as shall
be agreed to from time to time by the Company and the Auction
Agent.
<PAGE>
18
(b) The Company shall indemnify the Auction Agent
against, and hold it harmless from, any loss, liability or
expense (including reasonable counsel fees and expenses),
incurred without negligence or bad faith on its part, arising out
of or in connection with its agency hereunder or under the
Broker-Dealer Agreements, including the costs and expenses of
defending itself against any claim or liability in connection
with its exercise or performance of any of its duties hereunder
and thereunder for which it is entitled to indemnification
hereunder or thereunder.
(c) Without limiting the generality of Section 6.4(b)
hereof, the Company shall indemnify the Auction Agent against,
and hold it harmless from, any loss, liability or expense
(including reasonable counsel fees and expenses), incurred
without negligence or bad faith on its part, arising out of or
resulting from (i) any decision by the Auction Agent to preclude
from participating in any Auction or from being a transferee any
person who has not delivered to the Auction Agent an executed
Purchaser's Letter as provided herein, even if the Auction Agent
has not precluded others who have not delivered executed
Purchaser's Letters to the Auction Agent from participating in an
Auction or being a transferee and (ii) any decision by the
Auction Agent to not accept an Order that does not specify the
Bidder, even if the Auction Agent has accepted other Orders not
specifying a Bidder.
ARTICLE VII
MISCELLANEOUS
Section 7.1. Term of Agreement. (a) The term of this
Agreement shall continue indefinitely until this Agreement shall
be terminated as provided in this Section 7.1. The Auction Agent
may terminate this Agreement upon written notice to the Company
on the date specified in such notice, which may be no earlier
than the Business Day following the later of (a) six months from
the date of this Agreement and (b) 60 days following delivery of
such notice. If the Auction Agent should resign, the Company
will use its best efforts to enter into an agreement with a
successor Auction Agent containing substantially the same terms
and conditions as this Agreement. The Company may remove the
Auction Agent, provided that, prior to such removal, the Company
shall have entered into an agreement substantially in the form of
this Agreement with a successor Auction Agent.
(b) Except as otherwise provided in this paragraph
(b), the respective rights and duties of the Company and the
Auction Agent under this Agreement shall cease upon termination
of this Agreement. The Company's representations, warranties,
covenants and obligations to the Auction Agent under Article V
<PAGE>
19
and Section 6.4 hereof shall survive the termination hereof.
Upon termination of this Agreement, the Auction Agent shall
resign as Auction Agent under each of the Broker-Dealer
Agreements and shall, at the Company's request, promptly deliver
to the Company copies of all books and records maintained by it
in connection with its duties hereunder.
Section 7.2. Communications. Except for (i)
communications authorized to be made by telephone pursuant to
this Agreement or the Auction Procedures and (ii) communications
in connection with Auctions (other than those expressly required
to be in writing), all notices, requests and other communications
to any party hereunder shall be in writing (including telecopy or
similar writing) and shall be given to such person addressed to
it, at its address or telecopy number set forth below:
If to the Company: FORD HOLDINGS, INC.
The American Road
Dearborn, Michigan 48121
Attention: Manager--Financing
Department
Telecopy No.: (313) 845-4077
Telephone No.: (313) 322-2110
For the purposes of Sections 2.6 and 3
Attention: Cash Management Section,
Banking & External Relations
Department
Telecopy No.: (313) 323-2340
Telephone No.: (313) 390-3322
<PAGE>
20
If to the Auction
Agent: THE BANK OF NEW YORK
101 Barclay Street
7th Floor
New York, New York 10286
Attention: Auction Desk
Telecopy No.: (212) 815-3522
Telephone No.: (212) 815-3521
or to such other address or telecopy number as such party may
hereafter specify for such purpose by notice to the other party.
Each such notice, request or communication shall be effective
when delivered at the address specified herein. Communications
shall be given on behalf of the Company by a Company Officer and
on behalf of the Auction Agent by an Authorized Officer.
Section 7.3. Entire Agreement. This Agreement
contains the entire agreement between the parties relating to the
subject matter hereof, and there are no other representations,
endorsements, promises, agreements or understandings, oral,
written or inferred, between the parties relating to the subject
matter hereof except for agreements relating to the compensation
of the Auction Agent.
Section 7.4. Benefits. Nothing herein, express or
implied, shall give to any Person, other than the Company, the
Auction Agent and their respective successors and assigns, any
benefit of any legal or equitable right, remedy or claim
hereunder.
Section 7.5. Amendment; Waiver. (a) This Agreement
shall not be deemed or construed to be modified, amended,
rescinded, cancelled or waived, in whole or in part, except by a
written instrument signed by the parties hereto. The Company
shall notify the Auction Agent of any change in the Certificate
of Designations and Certificate of Incorporation prior to the
effective date of any such change.
(b) Failure of either party hereto to exercise any
right or remedy hereunder in the event of a breach hereof by the
other party shall not constitute a waiver of any such right or
remedy with respect to any subsequent breach.
Section 7.6. Successors and Assigns. This Agreement
shall be binding upon, inure to the benefit of and be enforceable
by the respective successors and assigns of each of the Company
and the Auction Agent.
Section 7.7. Severability. If any clause, provision
or section hereof shall be ruled invalid or unenforceable by any
<PAGE>
21
court of competent jurisdiction, the invalidity or
unenforceability of such clause, provision or section shall not
affect any of the remaining clauses, provisions or sections
hereof.
Section 7.8. Execution in Counterparts. This
Agreement may be executed in several counterparts, each of which
shall be an original and all of which shall constitute but one
and the same instrument.
Section 7.9. Governing Law. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and
duly authorized officers as of the date first above written.
FORD HOLDINGS, INC.
By /s/ Eric A. Law
-----------------------------
Name: Eric A. Law
Title: Vice President - Controller
THE BANK OF NEW YORK
By /s/ Sandra Becker-Whelan
-----------------------------
Name: Sandra Becker-Whelan
Title: Assistant Vice President
<PAGE>
EXHIBIT A
---------
-----------------------------------------------------------------
BROKER-DEALER AGREEMENT
Between
THE BANK OF NEW YORK
and
[NAME OF BROKER-DEALER]
Dated as of June 23, 1995
Relating to
FLEXIBLE RATE AUCTION PREFERRED
STOCK--SERIES O and SERIES P
of
FORD HOLDINGS, INC.
-----------------------------------------------------------------
<PAGE>
A-1
BROKER-DEALER AGREEMENT dated as of June 23, 1995
between THE BANK OF NEW YORK, a New York banking corporation (not
in its individual capacity but solely as agent of FORD HOLDINGS,
INC. (the "Company") pursuant to authority granted to it in the
Auction Agent Agreement (as hereinafter defined) together with
its successors and assigns, the "Auction Agent"), and [NAME OF
BROKER-DEALER] (together with its successors and assigns, "BD").
The Company has issued 500 shares of its Flexible Rate
Auction Preferred Stock--Series O and 500 shares of its Flexible
Rate Auction Preferred Stock--Series P (collectively, the
"Auction Preferred"), pursuant to the Certificate of Designations
creating and establishing the Auction Preferred and amending its
Certificate of Incorporation.
The Certificate of Designations provides that the
dividend rate on the shares of each series of the Auction
Preferred for each Dividend Period for such series after the
initial Dividend Period for such series shall be the Applicable
Rate, which shall, except under certain circumstances, be the
rate per annum that a bank or trust company appointed by the
Company advises results from implementation of the Auction
Procedures with respect to such series. The Company has duly
appointed The Bank of New York as the Auction Agent for purposes
of implementing the Auction Procedures and related matters for
the Auction Preferred. Pursuant to Section 2.2(a) of the Auction
Agent Agreement, the Company has requested and directed the
Auction Agent to execute and deliver this Agreement.
The Auction Procedures require the participation of one
or more Broker-Dealers.
NOW, THEREFORE, in consideration of the mutual
covenants contained herein, the Auction Agent and BD agree as
follows:
ARTICLE I
DEFINITIONS AND RULES OF CONSTRUCTION
Section 1.1. Terms Defined by Reference to Certificate of
Designations. Capitalized terms not defined herein shall have
the respective meanings specified in the Certificate of
Designations.
Section 1.2. Terms Defined Herein. As used herein and in
the Settlement Procedures, the following terms shall have the
following meanings, unless the context otherwise requires:
"Act" shall mean the Securities Act of 1933, as
amended.
<PAGE>
A-2
"Auction" shall have the meaning specified in
Section 2.1 hereof.
"Auction Agent Agreement" shall mean the Auction Agent
Agreement dated as of June 23, 1995 between the Company and
the Auction Agent relating to the Auction Preferred.
"Authorized Officer" shall mean each Senior Vice
President, Vice President, Assistant Vice President and
Assistant Treasurer of the Auction Agent assigned to its
Corporate Trust Department and every other officer or
employee of the Auction Agent designated as an "Authorized
Officer" for purposes of this Agreement in a communication
to the Company.
"BD Officer" shall mean each officer or employee of BD
designated as a "BD Officer" for purposes of this Agreement
in a communication to the Auction Agent.
"Broker-Dealer Agreement" shall mean this Agreement and
any substantially similar agreement between the Auction
Agent and a Broker-Dealer.
"Certificate of Designations" shall mean the
Certificate of Designations creating and establishing the
Auction Preferred and amending the Certificate of
Incorporation of the Company as filed by the Company in the
office of the Secretary of State of the State of Delaware
on June 22, 1995, a copy of which is attached hereto as
Exhibit A.
"Commission" shall mean the Securities and Exchange
Commission.
"Company" shall mean Ford Holdings, Inc., a Delaware
corporation, and its successors and assigns.
"Purchaser's Letter" shall mean a purchaser's letter
substantially in the form attached hereto as Exhibit B.
"Settlement Procedures" shall mean the Settlement
Procedures attached hereto as Exhibit C.
Section 1.3. Rules of Construction. Unless the
context or use indicates another or different meaning or intent,
the following rules shall apply to the construction of this
Agreement:
(a) Words importing the singular number shall include
the plural number and vice versa.
(b) The captions and headings herein are solely for
<PAGE>
A-3
convenience of reference and shall not constitute a part of
this Agreement nor shall they affect the meaning,
construction or effect of any provision hereof.
(c) The words "hereof," "herein," "hereto" and other
words of similar import refer to this Agreement as a whole.
(d) All references herein to a particular time of day
shall be to New York City time.
ARTICLE II
THE AUCTION
Section 2.1. Purpose; Incorporation by Reference of
Auction Procedures and Settlement Procedures. (a) The
provisions of the Auction Procedures shall be followed by the
Auction Agent for the purpose of determining the Applicable Rate
for each series of Auction Preferred. Each periodic operation of
such Auction Procedures is hereinafter referred to as an
"Auction."
(b) All of the provisions contained in the Auction
Procedures and the Settlement Procedures are incorporated herein
by reference in their entirety and shall be deemed to be a part
of this Agreement to the same extent as if such provisions were
fully set forth herein.
(c) Unless BD has heretofore done so, BD is delivering
herewith a Purchaser's Letter executed by BD. BD agrees to act
as, to assume the obligations of and to be subject to the
limitations and restrictions placed upon a Broker-Dealer under
this Agreement. BD understands that other Persons meeting the
requirements specified in the definition of "Broker-Dealer"
contained in paragraph 8 of the Certificate of Designations may
execute Broker-Dealer Agreements and Purchaser's Letters and
participate as Broker-Dealers in Auctions. BD agrees to handle
customer orders in accordance with its respective duties under
applicable securities laws and rules.
(d) BD and other Broker-Dealers may participate in Auctions
for their own accounts, provided that BD or such other
Broker-Dealers, as the case may be, have executed and deposited
with the Auction Agent a Purchaser's Letter. However, the
Company may, by notice to BD and all other Broker-Dealers,
prohibit all Broker-Dealers from submitting Bids in Auctions for
their own account, but the Broker-Dealers may continue to submit
Hold and Sell Orders.
Section 2.2. Preparation for Each Auction. (a) Not later
than 9:30 a.m. on each Auction Date for the Auction Preferred,
<PAGE>
A-4
the Auction Agent shall advise the Broker-Dealers by telephone of
(i) the 60-day "AA" Composite Commercial Paper Rate, if the
Dividend Period immediately following such Auction Date is a
Short-Term Dividend Period or (ii) the Reference Rate, if the
Dividend Period immediately following such Auction Date is a
Long-Term Dividend Period, and, in each case, the Maximum
Applicable Rate.
(b) In the event that the Auction Date for any Auction for
the Auction Preferred shall be changed after the Auction Agent
has given the notice referred to in clause (vii) of paragraph
(a) of the Settlement Procedures, or after BD receives the Notice
of Long-Term Dividend Period referred to in Section 2.4(d)
hereof, if applicable, the Auction Agent, by such means as the
Auction Agent deems practicable, shall give notice of such change
to BD not later than the earlier of 9:15 a.m. on the new Auction
Date or 9:15 a.m. on the old Auction Date. Thereafter, BD shall
promptly notify its customers whom BD believes are Existing
Holders of such change in Auction Date.
(c) The Auction Agent or the Company from time to time may
request the Broker-Dealers to provide the Auction Agent with a
list of their respective customers that such Broker-Dealers
believe are Existing Holders of shares of the Auction Preferred.
BD shall comply with any such request, and the Auction Agent
shall not disclose or authorize the disclosure of any such
information so provided to any Person except as provided and in
accordance with Sections 2.2(e), 2.2(f), 2.8 and 4.6 of the
Auction Agent Agreement.
(d) The Auction Agent is not required to accept the
Purchaser's Letter of any Potential Holder who wishes to submit a
Bid for the first time in an Auction or any amendment to a
Purchaser's Letter of any Potential Holder or Existing Holder who
wishes to amend its Purchaser's Letter intending that such
amendment is to take effect with respect to an Auction, unless
such Purchaser's Letter or such amendment received by the Auction
Agent by 3:00 p.m. on the Business Day preceding the related
Auction Date.
Section 2.3. Auction Schedule; Method of Submission of
Orders. (a) The Auction Agent shall conduct Auctions in
accordance with the schedule set forth below. Such schedule may
be changed by the Auction Agent with the consent of the Company,
which consent shall not be unreasonably withheld. The Auction
Agent shall give written notice of any such change to BD. Such
notice shall be given prior to the close of business on the
Business Day next preceding the first Auction Date on which any
such change shall be effective.
<PAGE>
A-5
Time on
Auction Date Event
- ------------ -----
By 9:30 a.m. Auction Agent advises Company and
Broker-Dealers of 60-day "AA"
Composite Commercial Paper Rate or the
Reference Rate, as the case may be,
and the Maximum Applicable Rate as set
forth in Section 2.2(a) hereof.
Between 9:30 a.m. Auction Agent assembles information
and 12:30 p.m. communicated to it by Broker-Dealers
as provided in paragraph 8(c) of the
Certificate of Designations.
Submission Deadline is 12:30 p.m.
Not earlier than Auction Agent makes determinations
12:30 p.m. pursuant to paragraph 8(d)(i) of the
Certificate of Designations.
By approximately Auction Agent advises Company of results
3:00 p.m. of Auction (including the term of the next
succeeding Dividend Period) as provided in
paragraph 8(d)(ii) of the Certificate of
Designations.
Submitted Bids and Submitted Sell Orders
are accepted and rejected and shares of
the Auction Preferred allocated as
provided in paragraph 8(e) of the
Certificate of Designations.
Auction Agent gives notice of Auction
results as set forth in Section 2.4(a)
hereof.
(b) BD agrees to maintain a list of Potential Holders, to
contact the Potential Holders on such list on or prior to each
Auction Date for the purpose set forth in paragraph 8(b) of the
Certificate of Designations.
(c) BD agrees not to sell, assign or dispose of any shares
of the Auction Preferred to any Person who has not delivered or
caused to be delivered a signed Purchaser's Letter.
(d) BD shall submit Orders to the Auction Agent in writing
substantially in the form attached hereto as Exhibit D. BD shall
submit a separate Order to the Auction Agent for each Potential
Holder or Existing Holder on whose behalf BD is submitting an
Order and shall not net or aggregate the Orders of different
<PAGE>
A-6
Potential Holders or Existing Holders on whose behalf BD is
submitting Orders.
(e) BD shall deliver to the Auction Agent (i) a written
notice, in substantially the form attached hereto as Exhibit E,
of transfers of shares of Auction Preferred made through BD by an
Existing Holder to another Person other than pursuant to an
Auction and shall deliver or cause to be delivered the related
Purchaser's Letter executed by such Person if such Person has not
previously so delivered a Purchaser's Letter and (ii) a written
notice substantially in the form attached hereto as Exhibit F, of
the failure of any shares of the Auction Preferred to be
transferred to or by any Person that purchased or sold shares of
the Auction Preferred through BD pursuant to an Auction. Any
notice delivered pursuant to the terms of the foregoing sentence
shall be effective for an Auction only if received by the Auction
Agent by 3:00 p.m. on the Business Day preceding the related
Auction Date.
(f) BD has delivered to the Auction Agent its executed
Purchaser's Letter. BD (if not an affiliate of the Company) may
submit Orders in Auctions for its own account, unless the Company
notifies all Broker-Dealers that they may no longer do so, in
which case Broker-Dealers may continue to submit for their own
accounts only Hold Orders and Sell Orders. Any Broker-Dealer
that is an affiliate of the Company may submit Orders in Auctions
but only if such Orders are not for its own account, except that
if any such affiliated Broker-Dealer holds shares of the Auction
Preferred for its own account, it must submit a Sell Order in the
next Auction with respect to such shares of the Auction
Preferred.
(g) BD agrees to handle its customers' Orders in accordance
with its duties under applicable securities laws and rules.
Section 2.4. Notices. (a) On each Auction Date, the
Auction Agent shall notify BD by telephone as provided in
paragraph (a) of the Settlement Procedures. By 11:30 a.m. on the
Business Day next succeeding such Auction Date, the Auction Agent
shall notify BD in writing of the disposition of all Orders
submitted by BD in the Auction held on such Auction Date.
(b) BD shall notify each Existing Holder or Potential
Holder on whose behalf BD has submitted an Order as provided in
paragraph (b) of the Settlement Procedures and take such other
action as is required of BD pursuant to the Settlement
Procedures.
(c) If the number of days comprising a Short-Term Dividend
Period is increased for any series of Auction Preferred with a
Short-Term Dividend Period as provided in paragraph 3(b)(v) of
the Certificate of Designations, the Auction Agent shall provide
<PAGE>
A-7
BD with a form of notice of such change not later than five days
after the receipt of such form of notice by the Auction Agent
from the Company. BD shall mail a copy of such notice (at the
address specified in such Existing Holder's Purchaser's Letter)
to each Existing Holder which acquired through BD, and, to the
knowledge of BD, has not disposed of its shares of the Auction
Preferred, at least 10 days prior to both (i) the first day of
the Dividend Period preceding the Dividend Period for which such
change is to be effective and (ii) the first day of the first
Dividend Period for which such change is to be effective.
(d) If the Term Selection Agent delivers to the Auction
Agent a Notice of Long-Term Dividend Period in the form of
Exhibit E to the Auction Agent Agreement or delivers a Notice of
Revocation in the form of Exhibit F to the Auction Agent
Agreement or if the Company delivers a Notice of Removal in the
form of Exhibit G to the Auction Agent Agreement, the Auction
Agent shall notify each BD by telephone and thereafter deliver
such notice to BD as promptly as practicable after its receipt of
such notice from the Term Selection Agent or the Company, as the
case may be. Promptly after receipt of any such notice, BD shall
notify by telephone (at the telephone number specified in such
Existing Holder's Purchaser's Letter) each Existing Holder of
Auction Preferred which acquired shares of Auction Preferred
through BD and, to the knowledge of BD, has not disposed of its
shares of Auction Preferred and each Potential Holder which BD
contacted in connection with any Auction after receipt of such
notice of the contents of such notice.
(e) If the Company delivers to the Auction Agent a Notice
of Cure of Failure to Deposit in the Form of Exhibit H to the
Auction Agent Agreement, the Auction Agent shall notify each BD
by telephone and thereafter deliver such notice to BD as promptly
as practicable after its receipt of such notice from the Company.
Promptly after receipt of any such notice, BD shall notify by
telephone (at the telephone number specified in such Existing
Holder's Purchaser's Letter) each Existing Holder of Auction
Preferred which acquired shares of Auction Preferred through BD
and, to the knowledge of BD, has not disposed of its shares of
Auction Preferred after receipt of such notice of the contents of
such notice.
Section 2.5. Service Charge to Be Paid to BD. Not later
than 12:00 noon on the Business Day next succeeding each Auction
Date for any series of the Auction Preferred, the Auction Agent
shall pay to BD from moneys received from the Company an amount
in cash equal to the product of (i)(A) if the next succeeding
Dividend Period for such series is a Short-Term Dividend Period
the product of (x) a fraction, the numerator of which is the
number of days in such Dividend Period (calculated by counting
the first day of such Dividend Period but excluding the last day
thereof) and the denominator of which is 360, times (y) 1/4 of 1%
<PAGE>
A-8
times (z) $100,000 or (B) if the next succeeding Dividend Period
for such series is a Long-Term Dividend Period, the product of
(x) such percentage as agreed to from time to time by the Company
and the Term Selection Agents times (y) $100,000 times (ii) the
sum of (A) the aggregate number of the shares of such series
placed by BD in such Auction that were (x) the subject of
Submitted Bids of Existing Holders submitted by BD and continued
to be held as a result of such submission and (y) the subject of
Submitted Bids of Potential Holders submitted by BD and were
purchased as a result of such submission, (B) the aggregate
number of shares of such series subject to valid Hold Orders
submitted to the Auction Agent by BD and (C) the number of shares
of such series that were covered by Hold Orders deemed to have
been submitted by Existing Holders pursuant to
paragraph 8(c)(iii) of the Certificate of Designations that were
acquired by such Existing Holders through BD. For purposes of
subclause (ii)(C) of the foregoing sentence, if any Existing
Holder who acquired shares of the Auction Preferred through BD
transfers those shares to another Person other than pursuant to
an Auction, then BD shall continue to be the Broker-Dealer for
the shares so transferred; provided, however, that, if the
transfer was effected by, or if the transferee is, a
Broker-Dealer other than BD, then such other Broker-Dealer shall
be the Broker-Dealer for such shares.
Section 2.6. Settlement. (a) If any Existing Holder on
whose behalf BD has submitted a Bid or Sell Order that was
accepted in whole or in part fails to instruct its Agent Member
to deliver shares of the Auction Preferred against payment
therefor, BD shall instruct such Agent Member to deliver to it
such shares against payment therefor and BD may deliver to the
Potential Holder on whose behalf BD submitted a Bid that was
accepted in whole or in part a number of shares of the Auction
Preferred that is less than the number of shares of the Auction
Preferred specified in such Bid to be purchased by such Potential
Holder. Notwithstanding the foregoing terms of this
Section 2.6(a), any delivery or nondelivery of shares of any
series of the Auction Preferred which represents any departure
from the results of an Auction, as determined by the Auction
Agent, shall be of no effect unless and until the Auction Agent
shall have been notified of such delivery or nondelivery in
accordance with Section 2.3(e) hereof. The Auction Agent shall
have no duty or liability with respect to enforcement of this
Section 2.6(a).
(b) Neither the Auction Agent nor the Company shall have
any responsibility or liability with respect to the failure of an
Existing Holder, a Potential Holder or its respective Agent
Member to deliver shares of the Auction Preferred or to pay for
shares of the Auction Preferred sold or purchased pursuant to the
Auction Procedures or otherwise.
<PAGE>
A-9
ARTICLE III
THE AUCTION AGENT
Section 3.1. Duties and Responsibilities. (a) The Auction
Agent is acting solely as agent of the Company hereunder and owes
no fiduciary duties to any other Person by reason of this
Agreement.
(b) The Auction Agent undertakes 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 Auction Agent.
(c) In the absence of bad faith or negligence on its part,
the Auction Agent shall not be liable for any action taken,
suffered or omitted or for any error of judgment made by it in
the performance of its duties under this Agreement. The Auction
Agent shall not be liable for any error of judgment made in good
faith unless the Auction Agent shall have been negligent in
ascertaining the pertinent facts.
Section 3.2. Rights of the Auction Agent. (a) The Auction
Agent may rely on and shall be protected in acting or refraining
from acting upon any communication authorized by this Agreement
and upon any written instruction, notice, request, direction,
consent, report, certificate, share certificate or other
instrument, paper or document believed by it to be genuine. The
Auction Agent shall not be liable for acting upon any telephone
communication authorized by this Agreement which the Auction
Agent believes in good faith to have been given by the Company or
by a Broker-Dealer. The Auction Agent may record, by tape or
otherwise, telephone communications with the Company, with BD or
both.
(b) The Auction Agent may consult with counsel, 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 good faith reliance
thereon.
(c) The Auction Agent shall not be required to advance,
expend or risk its own funds or otherwise incur or become exposed
to financial liability in the performance of its duties
hereunder.
(d) The Auction Agent may perform its duties and exercise
its rights hereunder either directly or by or through agents or
attorneys.
Section 3.3. Auction Agent's Disclaimer and
Representations. The Auction Agent makes no representation as to
<PAGE>
A-10
the validity or adequacy of this Agreement or the shares of
Auction Preferred. The Auction Agent represents that it has been
duly organized, is validly existing and is in good standing under
the laws of the State of New York; has all necessary corporate
powers to execute and deliver this Agreement and to perform the
duties imposed on it as Auction Agent herein; and has, in fact,
validly executed and delivered this Agreement.
ARTICLE IV
MISCELLANEOUS
Section 4.1. Termination. Any party may terminate this
Agreement at any time on five days' notice to the other party.
Section 4.2. Agent Member. At the date hereof, BD is, and
shall remain for the terms of this Agreement, a participant in,
or member of, the Securities Depository.
Section 4.3. Communications. Except for (i) communications
authorized to be by telephone by this Agreement or the Auction
Procedures or (ii) communications in connection with the Auctions
(other than those expressly required to be in writing), all
notices, requests and other communications to either party
hereunder shall be in writing (including telecopy or similar
writing) and shall be given to such party, addressed to it, at
its address or telecopier number set forth below.
If to BD:
Attention:
Telecopier No.:
Telephone No.:
If to the
Auction Agent: THE BANK OF NEW YORK
101 Barclays Street
7th Floor
New York, New York 10286
Attention: Auction Desk
Telecopier No.: (212) 815-3522
Telephone No.: (212) 815-3521
or such other address or telecopier number as such party may
hereafter specify for such purpose by notice to the other party.
Each such notice, request or communication shall be effective
(i) if given by telex, when such telex is transmitted to the
telex number specified herein and the appropriate answerback is
received or (ii) if given by any other means, when delivered at
<PAGE>
A-11
the address specified herein. Communications shall be given on
behalf of BD by a BD Officer and on behalf of the Auction Agent
by an Authorized Officer. BD may record telephone communications
with the Auction Agent.
Section 4.4. Entire Agreement. This Agreement contains the
entire agreement between the parties relating to the subject
matter hereof, and there are no other representations,
endorsements, promises, agreements or understandings, oral,
written or inferred, between the parties relating to the subject
matter hereof.
Section 4.5. Benefits. Nothing in this Agreement, express
or implied, shall give to any person, other than the Auction
Agent and BD and their respective successors and assigns, any
benefit of any legal or equitable right, remedy or claim under
this Agreement.
Section 4.6. Amendment; Waiver. (a) This Agreement shall
not be deemed or construed to be modified, amended, rescinded,
cancelled or waived, in whole or part, except by a written
instrument signed by duly authorized representatives of the
parties hereto.
(b) Failure of either party to this Agreement to exercise
any right or remedy hereunder in the event of a breach of this
Agreement by the other party shall not constitute a waiver of any
such right or remedy with respect to any subsequent breach.
Section 4.7. Successors and Assigns. This Agreement shall
be binding upon, inure to the benefit of and be enforceable by
the respective successors and assigns of BD and the Auction
Agent.
Section 4.8. Severability. If any clause, provision or
section of this Agreement shall be ruled invalid or unenforceable
by any court of competent jurisdiction, the invalidity or
unenforceability of such clause, provision or section shall not
affect any of the remaining clauses, provisions or sections
hereof.
Section 4.9. Execution in Counterparts. This Agreement may
be executed in several counterparts, each of which shall be an
original and all of which shall constitute but one and the same
instrument.
Section 4.10. Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the
State of New York.
<PAGE>
A-12
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and
duly authorized officers as of the date first above written.
THE BANK OF NEW YORK
By:
----------------------------
Name:
Title:
[NAME OF BROKER-DEALER]
By:
----------------------------
Name:
Title:
<PAGE>
EXHIBIT A OF BROKER-DEALER AGREEMENT
CERTIFICATE OF DESIGNATIONS
[Insert form of Certificate of Designations]
<PAGE>
EXHIBIT B OF BROKER-DEALER AGREEMENT
PURCHASER'S LETTER
[Insert form of Purchaser's Letter]
<PAGE>
EXHIBIT C OF BROKER-DEALER AGREEMENT
SETTLEMENT PROCEDURES
[Insert Settlement Procedures]
<PAGE>
EXHIBIT D OF BROKER-DEALER AGREEMENT
(Submit only one Order on this Order form)
FORD HOLDINGS, INC.
FLEXIBLE RATE AUCTION PREFERRED STOCK --
SERIES [O][P]
ORDER FORM
To:
------------------------
Date of Auction
The undersigned Broker-Dealer submits the following Order on
behalf of the Bidder listed below:
Name of Bidder:
------------------------------
Bidder places the Order listed below covering the number of
shares indicated (complete only one blank):
shares now held by Bidder (an Existing Holder),
----- and the Order is a (check one):
& Hold Order; or
--
& Bid at a rate of %; or
----- --
& Sell Order;
-or-
shares not now held by Bidder (a Potential
----- Holder), and the Order is a:
Bid at a rate of %.
-----
Notes:
(1) If submitting more than one Order for one Bidder, use
additional Order forms.
<PAGE>
D-2
(2) If one or more Orders covering in the aggregate more
than the number of outstanding shares of Auction Preferred held
by any Existing Holder are submitted, such Orders shall be
considered valid in the order of priority set forth in the
Auction Procedures.
(3) A Hold Order may be placed only by an Existing Holder
covering a number of shares of Auction Preferred not greater than
the number of shares currently held by such Existing Holder.
(4) Potential Holders may make only Bids, each of which
must specify a rate. If more than one Bid is submitted on behalf
of any Potential Holder, each Bid submitted shall be a separate
bid with the rate specified.
(5) Bids may contain no more than three figures to the
right of the decimal point (.001 of 1%).
Name
------------------------------
(Name of Broker-Dealer)
By
--------------------------------
Name:
Title:
<PAGE>
EXHIBIT E OF BROKER-DEALER AGREEMENT
(To be used only for transfers made other than pursuant
to an Auction)
FORD HOLDINGS, INC.
FLEXIBLE RATE AUCTION PREFERRED STOCK --
SERIES [O][P]
TRANSFER FORM
the Existing Holder named below;
-----
the Agent Member for such Existing Holder; or
-----
the Broker-Dealer for such Existing Holder
-----
We hereby notify you that such Existing Holder has
transferred:
shares of the Series [O][P] Auction Preferred
----- transferred
Name
----------------------------
(Name of Existing Holder)
By
----------------------------------
Name:
Title:
---------------------------------
(Name of Agent Member or
Broker-Dealer)
By
-----------------------------------
Name:
Title:
<PAGE>
EXHIBIT F OF BROKER-DEALER AGREEMENT
(To be used for failures to deliver shares of
Auction Preferred sold pursuant to an Auction)
FORD HOLDINGS, INC.
FLEXIBLE RATE AUCTION
PREFERRED STOCK--SERIES [O][P]
NOTICE OF A FAILURE TO DELIVER
Complete either I or II
- -----------------------
I. We are a Broker-Dealer for (the
"Purchaser"), which purchased shares of the
Series [O][P] Auction Preferred in the Auction held on
from (the
"Seller").
II. We are a Broker-Dealer for (the
"Seller"), which sold shares of the Series
[O][P] Auction Preferred in the Auction held on
to (the
"Purchaser").
We hereby notify you that (check one):
the Seller failed to deliver such shares of the
Auction Preferred to the Purchaser.
the Purchaser failed to make payment to the
Seller upon delivery of such shares of the Auction
Preferred.
Name
------------------------------
(Name of Broker-Dealer)
By
--------------------------------
Name:
Title:
<PAGE>
Exhibit B
---------
CERTIFICATE OF THE DESIGNATIONS, PREFERENCES
AND RELATIVE, PARTICIPATING, OPTIONAL OR
OTHER SPECIAL RIGHTS, AND THE QUALIFICATIONS,
LIMITATIONS OR RESTRICTIONS THEREOF, OF
FLEXIBLE RATE AUCTION PREFERRED STOCK,
SERIES O AND SERIES P
OF
FORD HOLDINGS, INC.
---------------------------------
Pursuant to Section 151(g) of the General Corporation Law
of the State of Delaware
----------------------------------
FORD HOLDINGS, INC., a corporation organized and existing
under the laws of the State of Delaware, hereby certifies that
the following resolution was adopted by the Board of Directors
and by the Certificate of Designations Committee, pursuant to
authority conferred on the Certificate of Designations
Committee by the Board of Directors:
RESOLVED, that two new series of Preferred Stock of the
Corporation are hereby created and established, and the
designation and amount thereof and the voting powers,
preferences and relative, participating and other special
rights of the shares of such series, and the qualifications,
limitations or restrictions thereof are as follows:
1. Designation; Amount and Series. The Preferred Stock
created hereby shall consist of 1,000 shares of flexible rate
auction preferred stock issuable in the following Series: 500
shares designated "Flexible Rate Auction Preferred
Stock--Series O Preferred" ("Series O Preferred") and 500
shares designated "Flexible Rate Auction Preferred
Stock--Series P Preferred" ("Series P Preferred")(the Series O
Preferred and the Series P Preferred are collectively referred
to as "Auction Preferred" or the "Preferred Stock").
Each share of each separate Series of Auction Preferred
shall be identical and equal in all aspects to every other
share of such Series, and the shares of all of the Series
shall, except as expressly provided in this Certificate of
Designations, be identical and equal in all respects.
B-2
2. Definitions. Unless the context or use indicates
another or different meaning or intent, the following terms
shall have the following meanings, whether used in the singular
or plural:
"60-day 'AA' Composite Commercial Paper Rate," on any
date, means (i) the interest equivalent of the 60-day rate on
commercial paper placed on behalf of issuers whose corporate
bonds are rated "aa" by Moody's or AA by Standard & Poor's or
the equivalent of such rating by another rating agency, as such
60-day rate is made available on a discount basis or otherwise
by the Federal Reserve Bank of New York for the Business Day
immediately preceding such date, or (ii) in the event that the
Federal Reserve Bank of New York does not make available such
a rate, then the arithmetic average of the interest equivalent
of the 60-day rate on commercial paper placed on behalf of such
issuers, as quoted on a discount basis or otherwise by the
Commercial Paper Dealers to the Auction Agent for the close of
business on the Business Day immediately preceding such date.
If any Commercial Paper Dealer does not quote a rate required
to determine the 60-day "AA" Composite Commercial Paper Rate,
the 60-day "AA" Composite Commercial Paper Rate shall be
determined on the basis of the quotation or quotations
furnished by the remaining Commercial Paper Dealer or
Commercial Paper Dealers and any Substitute Commercial Paper
Dealer or Substitute Commercial Paper Dealers selected by the
Corporation to provide such rate or rates not being supplied by
any Commercial Paper Dealer or Commercial Paper Dealers, as the
case may be, or, if the Corporation does not select any such
Substitute Commercial Paper Dealer or Substitute Commercial
Paper Dealers, by the remaining Commercial Paper Dealer or
Commercial Paper Dealers. If the Board of Directors of the
Corporation shall make the adjustment referred to in the second
sentence of paragraph 3(b)(v), then (i) if the Dividend Period
Days shall be fewer than 70 days, such rate shall be the
interest equivalent of the 60-day rate on such commercial
paper, (ii) if the Dividend Period Days shall be 70 or more
days but fewer than 85 days, such rate shall be the arithmetic
average of the interest equivalent of the 60-day and 90-day
rates on such commercial paper and (iii) if the Dividend Period
Days shall be 85 or more days but fewer than 99 days, such rate
shall be the interest equivalent of the 90-day rate on such
commercial paper. For purposes of such definition, "interest
equivalent" of a rate stated on a discount basis (a "discount
rate") for commercial paper of a given day's maturity shall be
equal to the quotient of (A) the discount rate divided by (B)
the difference between (x) 1.00 and (y) a fraction the
numerator of which shall be the product of the discount rate
times the number of days in which such commercial paper matures
and the denominator of which shall be 360.
<PAGE>
B-3
"Affiliate" means any Person controlled by, in control of,
or under common control with, the Corporation.
"Applicable 'AA' Composite Commercial Paper Rate" means,
for any Long-Term Dividend Period on any date, (A) in the case
of any Long-Term Dividend Period of less than 70 days, the
interest equivalent of the 60-day rate, (B) in the case of any
Long-Term Dividend Period of 70 days or more but less than 85
days, the arithmetic average of the interest equivalent of the
60-day and 90-day rates, (C) in the case of any Long-Term
Dividend Period of 85 days or more but less than 120 days, the
interest equivalent of the 90-day rate, (D) in the case of any
Long-Term Dividend Period of 120 days or more but less than 148
days, the arithmetic average of the interest equivalent of the
90-day and 180-day rates, (E) in the case of any Long-Term
Dividend Period of 148 days or more but less than 210 days, the
interest equivalent of the 180-day rate, (F) in the case of any
Long-Term Dividend Period of 210 days or more but less than 238
days, the arithmetic average of the interest equivalent of the
180-day and 270-day rates and (G) in the case of any Long-Term
Dividend Period of 238 or more days, the interest equivalent of
the 270-day rate, on commercial paper placed on behalf of
issuers whose corporate bonds are rated "aa" by Moody's, AA by
Standard & Poor's, or the equivalent of such rating by another
rating agency, as made available on a discount basis or
otherwise by the Federal Reserve Bank of New York for the
Business Day immediately preceding such date or in the event
that the Federal Reserve Bank of New York does not make
available any such rate, then the arithmetic average of such
rates, as quoted on a discount basis or otherwise, by
Commercial Paper Dealers, to the Auction Agent for the close of
business on the Business Day next preceding such date. If any
Commercial Paper Dealer does not quote a rate required to
determine the "AA" Composite Commercial Paper Rate, the "AA"
Composite Commercial Paper Rate shall be determined on the
basis of the quotation or quotations furnished by the remaining
Commercial Paper Dealer or Commercial Paper Dealers and any
Substitute Commercial Paper Dealer or Substitute Commercial
Paper Dealers selected by the Corporation to provide such rate
or rates not being supplied by any Commercial Paper Dealer or
Commercial Paper Dealers, as the case may be, or, if the
Corporation does not select any such Substitute Commercial
Paper Dealer or Substitute Commercial Paper Dealers, by the
remaining Commercial Paper Dealer or Commercial Paper Dealers.
For purposes of this definition, the "interest equivalent"
means the equivalent yield on a 360-day basis of a
discount-basis security to an interest-bearing security.
"Applicable Rate" means the rate per annum at which
dividends are payable on a Series for any Dividend Period for
such Series established pursuant to paragraph 3(c) hereof.
<PAGE>
B-4
"Applicable Treasury Rate" on any date, with respect to
any Series of Auction Preferred with a Long-Term Dividend
Period of one year or more, means the interest equivalent of
the rate for direct obligations of the United States Treasury
having an original maturity which is equal to, or next lower
than, the length of such Long-Term Dividend Period, as
published weekly by the Federal Reserve Board in "Federal
Reserve Statistical Release H.15 (519)--Selected Interest
Rates," or any successor publication by the Federal Reserve
Board within five Business Days preceding such date. In the
event that the Federal Reserve Board does not publish such
weekly per annum interest rate, or if such release is not yet
available, the Applicable Treasury Rate shall be the arithmetic
mean of the secondary market bid rates as of approximately
3:30 p.m., New York City time, on the Business Day next
preceding such date of the U.S. Government Securities Dealers
obtained by the Auction Agent (in the case of a determination
of the Applicable Treasury Rate on any Auction Date) or the
Corporation (in the case of a determination of such rate on any
other day) for the issue of direct obligations of the United
States Treasury, in an aggregate principal amount of at least
$1,000,000, with a remaining maturity equal to, or next lower
than, the length of such Long-Term Dividend Period. If any
U.S. Government Securities Dealer does not quote a rate
required to determine the Applicable Treasury Rate, the
Applicable Treasury Rate shall be determined on the basis of
the quotation or quotations furnished by the remaining U.S.
Government Securities Dealer or Dealers or any Substitute U.S.
Government Securities Dealer or Dealers selected by the
Corporation to provide such rate or rates not being supplied by
any U.S. Government Securities Dealer or Dealers, as the case
may be, or, if the Corporation does not select any such
Substitute U.S. Government Securities Dealer or Dealers, by the
remaining U.S. Government Securities Dealer or Dealers;
provided that, in the event the Corporation is unable to cause
such quotations to be furnished to the Auction Agent (or, if
applicable, to the Corporation) by such sources, the
Corporation may cause the Applicable Treasury Rate to be
furnished to the Auction Agent (or, if applicable, to the
Corporation) by such alternative source or sources as the
Corporation in good faith deems to be reliable. For purposes
of this definition, the "interest equivalent" of a rate stated
on a discount basis shall be equal to the quotient of (A) the
discount rate divided by (B) the difference between 1.00 and
the discount rate.
"Auction" means each periodic operation of the Auction
Procedures.
"Auction Agent" means The Bank of New York, unless or
until another bank or trust company has been appointed as such
by a resolution of the Board of Directors of the Corporation.
<PAGE>
B-5
"Auction Date" has the meaning specified in paragraph
8(a)(iv) below.
"Auction Preferred" or "Preferred Stock" means all of the
Series.
"Auction Procedures" means the procedures for conducting
Auctions set forth in paragraph 8 below.
"Board of Directors" means the Board of Directors of the
Corporation or, unless the context otherwise requires, an
authorized committee thereof.
"Business Day" means a day on which the New York Stock
Exchange is open for trading and which is not a day on which
banks in the State of New York are authorized or obligated by
law or executive order to close.
"Cash-Out Merger" has the meaning specified in Section
4(b) hereof.
"Certificate of Designations Committee" means the
committee of the Board of Directors on which the Board of
Directors has conferred authority to fix the designations,
preferences and relative, participating, optional or other
special rights, and qualifications, limitations or restrictions
of Auction Preferred.
"Code" means the Internal Revenue Code of 1986, as
amended.
"Commercial Paper Dealers" means Goldman, Sachs & Co.,
Lehman Commercial Paper Incorporated, Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated and Morgan
Stanley & Co. Incorporated or, in lieu of any thereof, their
respective affiliates or successors.
"Common Stock" means all shares now or hereafter issued of
the class of common stock of the Corporation presently
authorized and any other shares of stock into which such stock
may hereafter be exchanged from time to time.
"Corporation" means Ford Holdings, Inc., a Delaware
corporation, or its successor.
"Date of Original Issue" means, as to any share, the date
on which the Corporation initially issues such share of Auction
Preferred.
"Default Period" has the meaning specified in Section
5(c)(i) hereof.
<PAGE>
B-6
"Dividend Payment Date" has the meaning specified in
Section 3(b)(vi) hereof.
"Dividend Period" has the meaning set forth in paragraph
3(b)(vii) below.
"Dividend Period Days" has the meaning set forth in
paragraph 3(b)(v) below.
"Dividend Quarter" has the meaning set forth in paragraph
3(b)(vi) below.
"Failure to Deposit" means, with respect to any Series of
Auction Preferred, the failure by the Corporation to
irrevocably deposit with the Paying Agent sufficient funds for
the payment of such dividends and to give the Paying Agent
irrevocable instructions to apply such funds and, if
applicable, the income and proceeds therefrom, to the payment
of such dividends not later than noon on the Business Day
immediately preceding each Dividend Payment Date with respect
to which dividends on such shares of Auction Preferred.
"Flexible Rate Auction Preferred Stock" means the Flexible
Rate Auction Preferred Stock (Exchange), Series A, Series B,
Series C, Series D, Series E, Series F, Series G, Series H,
Series I, Series J and Series K and the Flexible Rate Auction
Preferred Stock, Series L, Series M and Series N, par value
$1.00 per share, liquidation preference $100,000 per share,
previously issued by the Corporation.
"Holder" or "holder" means, when used with respect to
Auction Preferred, the Flexible Rate Auction Preferred Stock,
the Series A Preferred Stock, the Series B Preferred Stock, the
Series C Preferred Stock, the Series D Preferred Stock, the
Parity Preferred or the Voting Preferred, the holder of such
shares as the same appears on the Stock Books.
"Initial Dividend Payment Date" has the meaning set forth
in paragraph 3(b)(vii) below.
"Junior Liquidation Stock" has the meaning specified in
Section 4(a) hereof.
"Junior Stock" shall have the meaning specified in Section
3(d)(ii) hereof.
"LIBOR" means, on any date for any Dividend Period, the
arithmetic average (rounded to the next higher 1/16 of 1%),
computed by the Auction Agent of the following rates per annum
or arithmetic averages thereof quoted by each of the principal
London offices of the Reference Banks, at which United States
dollar deposits in the amount of U.S. $10,000,000 are offered
<PAGE>
B-7
by such Reference Banks (i) in the case of any Dividend Period
with Dividend Period Days of less than 30 days, the one-month
rate, (ii) in the case of any Dividend Period with Dividend
Period Days of 30 days or more but less than 70 days, the
two-month rate, (iii) in the case of any Dividend Period with
Dividend Period Days of 70 or more days but less than 85 days,
the two-month and three-month rates and (iv) in the case of any
Dividend Period Days of 85 or more but less than 98 days or in
case a Failure to Deposit occurs during a Long-Term Dividend
Period, the three-month rate, to leading banks in the London
interbank market at approximately 11:00 a.m. (London time) on
the first day of such Dividend Period (or Dividend Quarter), or
if such day is not a day on which dealings in United States
dollars are transacted in the London interbank market, then on
the next preceding day on which such dealings are transacted in
such market. If any Reference Bank does not quote a rate
required to determine LIBOR, LIBOR shall be determined on the
basis of the quotations furnished by the remaining Reference
Bank or Reference Banks and any Substitute Reference Bank or
Substitute Reference Banks selected by the Corporation to
provide such quotation or quotations not being supplied by any
Reference Bank or Reference Banks, as the case may be, or, if
the Corporation does not select any Substitute Reference Bank
or Substitute Reference Banks, by the remaining Reference Bank
or Reference Banks.
"Liquidation Preferred" has the meaning specified in
Section 4(d) hereof.
"Long-Term Dividend Period" has the meaning set forth in
paragraph 3(b)(vii) below.
"Maximum Applicable Rate", with respect to any Series with
a Short-Term Dividend Period, at any Auction shall be the rate
obtained by multiplying the 60-day "AA" Composite Commercial
Paper Rate on the date of such Auction, and with respect to any
Series with a Long-Term Dividend Period, the Maximum Applicable
Rate at any Auction shall be the rate obtained by multiplying
the Reference Rate, in each case, by a percentage determined as
set forth below based on the lower of the credit rating or
ratings assigned to the Auction Preferred by Moody's and
Standard & Poor's (or if Moody's or Standard & Poor's or both
shall not make such rating available, the equivalent of either
or both of such ratings by a Substitute Rating Agency or two
Substitute Rating Agencies or, in the event that only one such
rating shall be available, the percentage shall be based on
such rating).
<PAGE>
B-8
Credit Rating Applicable Percentage of
- ---------------------------- 60-day "AA" Composite
Standard & Commercial Paper Rate
Moody's Poor's or Reference Rate
- ------- ----------------- ------------------------
[S] [C] [C]
"aa3" or Above AA- or Above 150%
"a3" to "a1" A- to A+ 200%
"baa3" to "baa1" BBB- to BBB+ 225%
Below "baa3" Below BBB- 250%
The Corporation shall take all reasonable action necessary to
enable Moody's and Standard & Poor's to provide a rating for
each Series of Auction Preferred. If either Moody's or
Standard & Poor's shall not make such rating available or
neither Moody's nor Standard & Poor's shall make such a rating
available, Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, Goldman, Sachs & Co. and Lehman Brothers
Inc. or their affiliates and successors, after consultation
with the Corporation, shall select a Substitute Rating Agency
or two Substitute Rating Agencies.
"Merger Premium" has the meaning set forth in paragraph
3(b)(viii) below.
"Minimum Holding Period" has the meaning set forth in
paragraph 3(b)(v) below.
"Moody's" means Moody's Investors Service, Inc., or its
successor, so long as such agency (or successor) is in the
business of rating securities of the type of the Auction
Preferred and, if such agency is not in such business, then a
Substitute Rating Agency.
"Non-Auction Rate" has the meaning set forth in
paragraph 3(c)(i) below.
"Normal Dividend Payment Date" has the meaning set forth
in paragraph 3(b)(ii) below.
"Notice of Long-Term Dividend Period" has the meaning set
forth in paragraph 3(b)(viii) below.
"Notice of Removal" has the meaning set forth in paragraph
3(b)(viii) below.
"Notice of Revocation" has the meaning set forth in
paragraph 3(b)(viii) below.
"Outstanding" means, as of any date, shares of Auction
Preferred, Voting Preferred or Parity Preferred, as the case
may be, theretofore issued by the Corporation except, without
<PAGE>
B-9
duplication, (i) any shares of Auction Preferred, Voting
Preferred or Parity Preferred, as the case may be, theretofore
cancelled or delivered for cancellation by the Corporation,
(ii) any shares of Auction Preferred, Voting Preferred or
Parity Preferred, as the case may be, represented by any
certificate in lieu of which a new certificate has been
executed and delivered by the Corporation and (iii) any shares
of Auction Preferred, Voting Preferred or Parity Preferred, as
the case may be, held by the Corporation as treasury stock.
"Parity Preferred" has the meaning specified in Section
5(a) hereof.
"Paying Agent" means the Auction Agent unless another bank
or trust company has been appointed for such purpose by
resolution of the Board of Directors of the Corporation.
"Person" means and include an individual, a partnership, a
corporation, a trust, an unincorporated association, a joint
venture or other entity.
"Rating Agencies" means Moody's and Standard & Poor's.
"Reference Banks" means The Chase Manhattan Bank (National
Association), Morgan Guaranty Trust of New York and National
Westminster Bank PLC, or, in lieu of any thereof, their
respective affiliates or successors.
"Reference Rate" means for Long-Term Dividend Periods
(i) from 50 days to 270 days, the Applicable "AA" Composite
Commercial Paper Rate, (ii) from 270 days to one year, the
higher of the 270-day Applicable "AA" Composite Commercial
Paper Rate and the one-year Applicable Treasury Rate and
(iii) from one year to 10 years, the Applicable Treasury Rate.
"Regular Preferred Directors" has the meaning set forth in
paragraph 5(a) below.
"Series" means either of Series O Preferred or Series P
Preferred of the Auction Preferred authorized by this
Certificate of Designations.
"Series A Preferred Stock" means the Series A Cumulative
Preferred Stock, par value $1.00 per share, liquidation
preference $100,000 per share, of the Corporation.
"Series B Preferred Stock" means the Series B Cumulative
Preferred Stock, par value $1.00 per share, liquidation
preference $100,000 per share, of the Corporation.
<PAGE>
B-10
"Series C Preferred Stock" means the Series C Cumulative
Preferred Stock, par value $1.00 per share, liquidation
preference $100,000 per share, of the Corporation.
"Series D Preferred Stock" means the Series D Cumulative
Preferred Stock, par value $1.00 per share, liquidation
preference $100,000 per share, of the Corporation.
"Short-Term Dividend Period" has the meaning set forth in
paragraph 3(b)(vii) below.
"Special Preferred Directors" has the meaning specified in
Section 5(c)(i) hereof.
"Standard & Poor's" means Standard & Poor's Ratings Group,
or its successor, so long as such agency (or successor) is in
the business of rating securities of the type of the Auction
Preferred and, if such agency is not in such business, then a
Substitute Rating Agency.
"Stock Books" means the stock transfer books of the
Corporation maintained by the Paying Agent.
"Substitute Commercial Paper Dealer" means CS First Boston
Corporation or PaineWebber Incorporated, or, in lieu of each
thereof, their respective affiliates or successors.
"Substitute Rating Agency" means a nationally recognized
statistical rating organization (as that term is used in the
rules and regulations of the Securities Exchange Act of 1934)
selected by Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner
& Smith Incorporated, Goldman, Sachs & Co. and Lehman Brothers
Inc. after consultation with the Corporation.
"Substitute Reference Bank" means the principal London
offices of Citibank, N.A., Deutsche Bank Aktiengesellschaft or
Swiss Bank Corporation or, in lieu thereof, their respective
successors, or, if none of such Substitute Reference Banks are
engaged in dealings in United States dollars in the London
interbank market, then a bank or banks selected by the
Corporation, engaged in dealings in United States dollars in
the London interbank market.
"Substitute U.S. Government Securities Dealer" means the
CS First Boston Corporation or PaineWebber Incorporated, or, in
lieu of each thereof, their respective affiliates or
successors.
"Term Selection Agent" means, collectively, Merrill Lynch
& Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Goldman, Sachs & Co. and Lehman Brothers Inc., unless or until
<PAGE>
B-11
another investment banking firm has been appointed as such by a
resolution of the Board of Directors of the Corporation.
"U.S. Government Securities Dealer" means Goldman, Sachs &
Co., Lehman Government Securities Incorporated, Merrill Lynch &
Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated and
Morgan Stanley & Co. Incorporated or, in lieu of any thereof,
their respective affiliates or successors.
"Voting Preferred" has the meaning specified in Section
5(b) hereof.
3. Dividends. (a) Holders of shares of Auction
Preferred shall be entitled to receive, when, as and if
declared by the Board of Directors of the Corporation, out of
surplus, or funds legally available therefor, cumulative cash
dividends at the Applicable Rate determined as set forth in
paragraph 3(c)(i) below, and no more, payable on the respective
dates set forth below.
(b)(i) Dividends on the shares of each Series shall
accumulate at the respective Applicable Rates for such
Series (whether or not declared) from the Date of Original
Issue.
(ii) Dividends on the shares of each Series with a
Short-Term Dividend Period shall be payable commencing on
the Initial Dividend Payment Date for such Series and
thereafter except as provided below in this paragraph
3(b), on each seventh Wednesday with respect to Series O
Preferred and Series P Preferred following the preceding
Dividend Payment Date for such Series. Dividends on the
shares of each Series with a Long-Term Dividend Period
shall be payable, except as provided below in this
paragraph 3(b), on the last day of such Long-Term Dividend
Period and, if occurring prior to the last day of such
Long-Term Dividend Period, on the first day of the
fourth month after the commencement of such Long-Term
Dividend Period and on the first day of each succeeding
third month thereafter. Each day on which dividends on
shares of a Series would be payable as determined as set
forth in this clause (ii) but for the provisions set forth
below in this paragraph 3(b) is referred to herein as a
"Normal Dividend Payment Date."
(iii) In the case of dividends payable on the shares of a
Series with a Short-Term Dividend Period, if:
(A)(I) The Securities Depository shall continue to
make available to its members and participants the
<PAGE>
B-12
amounts due as dividends on the shares of such Series
in immediately available funds on the dates on which
such dividends are payable and (II) a Normal Dividend
Payment Date for such Series is not a Business Day,
then dividends shall be payable on the first Business
Day following such Normal Dividend Payment Date; or
(B)(I) The Securities Depository shall make available
to its members and participants the amounts due as
dividends on the shares of such Series in next-day
funds on the dates on which such dividends are
payable (and the Securities Depository shall have so
advised the Auction Agent) and (II) a Normal Dividend
Payment Date for such Series is not a Business Day,
or the day next succeeding such Normal Dividend
Payment Date is not a Business Day, then dividends
shall be payable on the first Business Day
preceding such Normal Dividend Payment Date that is
next succeeded by a Business Day.
(iv) In the case of dividends payable on the shares of a
Series with a Long-Term Dividend Period, if:
(A)(I) The Securities Depository shall continue to make
available to its members and participants the amounts due
as dividends on the shares of such Series in immediately
available funds on the dates on which such dividends are
payable and (II) a Normal Dividend Payment Date for such
Series is not a Business Day, then dividends shall be
payable on the first Business Day following such Normal
Dividend Payment Date; or
(B)(I) The Securities Depository shall make available to
its members and participants the amounts due as dividends
on the shares of such Series in next-day funds on the dates
on which such dividends are payable (and the Securities
Depository shall have so advised the Auction Agent) and
(II) a Normal Dividend Payment Date for such Series is not
a Business Day, or the day next succeeding such Normal
Dividend Payment Date is not a Business Day, then dividends
shall be payable on the first Business Day following such
Normal Dividend Payment Date that is next succeeded by a
Business Day.
(v) Notwithstanding the foregoing, if the date on which
dividends on the shares of any Series would be payable as
determined as set forth in clause (ii), (iii) or (iv) above
is a day that would result in the number of days between
successive Auction Dates for such Series (determined by
including the first Auction Date and excluding the second
Auction Date) not being at least equal to the then current
<PAGE>
B-13
Minimum Holding Period, then dividends on such shares shall
be payable, if either clause (iii)(A) or (iv)(A) above
would be applicable to such Series, on the first Business
Day following such day on which dividends would be so
payable or, if either clause (iii)(B) or (iv)(B) above
would be applicable to such Series, on the first Business
Day following such date on which dividends would be so
payable that is next succeeded by a Business Day, that in
either case results in the number of days between such
successive Auction Dates for such Series (determined as set
forth above) being at least equal to the then current
Minimum Holding Period.
In addition, notwithstanding the foregoing, in the event
of a change in law altering the minimum holding period (the
"Minimum Holding Period") required for corporate taxpayers
generally to be entitled to the dividends received
deduction for federal income tax purposes in respect of
dividends (other than extraordinary dividends) paid on
preferred stock held by non-affiliated corporations, the
Board of Directors of the Corporation may adjust the period
of time between Dividend Payment Dates for each Series so as
to adjust uniformly the number of days (such number of days
without giving effect to the provisions in clauses (iii) and
(iv) above being hereinafter referred to as "Dividend Period
Days") in Dividend Periods for each Series commencing after
the date of such change in law to equal or exceed the then
current Minimum Holding Period, provided that the number of
Dividend Period Days shall not exceed by more than nine days
the length of such then current Minimum Holding Period and
shall be evenly divisible by seven, and the maximum number
of Dividend Period Days in no event shall exceed 98 days.
Upon any such change in the number of Dividend Period Days
as a result of a change in law, the Corporation shall mail
notice of such change by first-class mail, postage prepaid,
to the Auction Agent and the Paying Agent and to each
Existing Holder.
(vi) Each date on which dividends on the shares of a Series
shall be payable as determined as set forth above shall be
referred to herein as a "Dividend Payment Date" for such
Series. If applicable, the period from the preceding
Dividend Payment Date to the next Dividend Payment Date for
any Series with a Long-Term Dividend Period is herein
referred to as a "Dividend Quarter." Although any
particular Dividend Payment Date for a Series may not occur
on the originally scheduled Normal Dividend Payment Date for
such Series because of the foregoing provisions, each
succeeding Dividend Payment Date for such Series shall be,
subject to such provisions, the date determined as set forth
in clause (ii) above as if each preceding Dividend Payment
<PAGE>
B-14
Dates had occurred on the respective originally scheduled
Normal Dividend Payment Date.
(vii) The Initial Dividend Payment Dates for the initial
Dividend Periods for Series O Preferred shall be August 16,
1995 and for Series P Preferred shall be August 30, 1995.
After the initial Dividend Period for each Series, each
subsequent Dividend Period for such Series (except for the
adjustments for non-Business Days provided in clauses (iii)
and (iv) above) shall be 49 days (each such 49-day period,
subject to any adjustment as a result of a change in law
lengthening the Minimum Holding Period as provided in
clause (v) above, being referred to herein as a "Short-Term
Dividend Period"), unless as provided in clause (viii)
below, the Term Selection Agent specifies that any such
subsequent Dividend Period shall be a Dividend Period of any
specified number of days greater than a Short-Term Dividend
Period and consisting of a whole number of weeks (each such
period being referred to herein as a "Long-Term Dividend
Period," and each such Short-Term Dividend Period and
Long-Term Dividend Period (together with the periods
commencing on the Date of Original Issue and ending on the
respective Initial Dividend Payment Dates for each Series)
being referred to herein as a "Dividend Period"). After the
Initial Dividend Period for a Series, each successive
Dividend Period for such Series shall commence on the
Dividend Payment Date ending the preceding Dividend
Period and shall end (i) in the case of any Series with a
Short-Term Dividend Period, on the next Dividend Payment
Date for such Series and (ii) in the case of any Series with
a Long-Term Dividend Period, on the last day of the
Long-Term Dividend Period specified by the Term Selection
Agent in the related notice of Long-Term Dividend Period.
(viii) Not less than 5 and not more than 20 days prior to
an Auction Date for any Series and based on the criteria set
forth below, the Term Selection Agent may give telephonic
and written notice to the Corporation, the Auction Agent,
the Paying Agent and the Securities Depository that the next
succeeding Dividend Period for such Series will be longer
than a Short-Term Dividend Period (a "Notice of Long-Term
Dividend Period"). Such notice will specify the next
succeeding Dividend Period for such Series as a Long-Term
Dividend Period, which may be any period designated by the
Term Selection Agent greater than the Short-Term Dividend
Period and consisting of a whole number of weeks and whether
such shares shall be entitled under the circumstances set
forth in paragraph 5(e)(iii) to a premium upon consolidation
or merger of the Corporation with or into any other
corporation ("Merger Premium"), provided that the Term
Selection Agent may not give a Notice of Long-Term Dividend
Period (including any Merger Premium) for such Series (and
<PAGE>
B-15
any such notice shall be null and void) unless Sufficient
Clearing Bids were made in the last occurring Auction for
such Series and full cumulative dividends for all Series and
for all series of the Flexible Rate Auction Preferred Stock
payable prior to such date have been paid in full. The Term
Selection Agent shall state in each Notice of Long-Term
Dividend Period (i) that the next succeeding Dividend Period
for such Series shall be a Long-Term Dividend Period, (ii)
the term thereof and (iii) whether such shares shall be
entitled under the circumstances set forth in paragraph
5(e)(iii) to a Merger
Premium in the event of a merger or consolidation. The Term
Selection Agent may establish a Long-Term Dividend Period
(including any Merger Premium) for the shares of a Series of
Auction Preferred, if the Term Selection Agent determines
that such Long-Term Dividend Period (including any Merger
Premium), in its sole opinion, provides the Corporation with
the most favorable financing alternative based upon the
following: (i) short-term and long-term market rates and
indices of such short-term and long-term rates, (ii) the
amounts, maturities and interest or dividend rates on the
then outstanding securities of the Corporation or its
subsidiaries, (iii) market supply and demand for short-term
and long-term securities, (iv) yield curves for short-term
and long-term securities comparable to the shares of Auction
Preferred, (v) industry and financial conditions which may
affect the shares of Auction Preferred including the Term
Selection Agent's expectations with respect thereto,
(vi) current tax laws and administrative interpretations
with respect thereto, (vii) the number of shares of Auction
Preferred and Flexible Rate Auction Preferred Stock
Outstanding on the next Auction Date and (viii) the number
of potential purchasers. Any Notice of Long-Term Dividend
Period may be revoked by the Term Selection Agent on or
prior to the second Business Day prior to the related
Auction by telephonic and written notice (a "Notice of
Revocation") to the Corporation, the Auction Agent, the
Paying Agent and the Securities Depository, specifying that
the Term Selection Agent has determined that because of
subsequent changes in any of the foregoing factors, such
Long-Term Dividend Period would not result in the most
favorable financing alternative for the Corporation, and
shall be deemed to have been revoked if on or prior to the
second Business Day prior to the related Auction, the Term
Selection Agent shall have been removed and the Corporation
shall have given written and telephonic notice of such
removal ("Notice of Removal") to the Auction Agent, the
Paying Agent and the Securities Depository. Except with
respect to a Notice of Long-Term Dividend Period that is
deemed to be revoked, any Long-Term Dividend Period
specified by the Term Selection Agent for each Series of
<PAGE>
B-16
Auction Preferred and any revocation thereof shall
be conclusive and binding on the Corporation and the
Holders.
The Corporation may remove the Term Selection Agent for
any Series of Auction Preferred upon 5 days' written notice.
If there is no Term Selection Agent with respect to any
Dividend Period, then such Dividend Period shall be a
Short-Term Dividend Period.
If the Term Selection Agent does not give a Notice of
Long-Term Dividend Period with respect to the next succeeding
Dividend Period for any Series of Auction Preferred or has
given a Notice of Long-Term Dividend Period but has also
delivered a Notice of Revocation with respect thereto or such
Notice of Long-Term Dividend Period shall be deemed to have
been revoked, such next succeeding Dividend Period shall be a
Short-Term Dividend Period. In addition, in the event the
Term Selection Agent has given a Notice of Long-Term Dividend
Period with respect to the next succeeding Dividend Period for
any Series of Auction Preferred and has not given a Notice of
Revocation with respect thereto and such Notice of Long-Term
Dividend Period shall not have been deemed revoked, but
Sufficient Clearing Bids are not made in the related Auction
for such Series or such Auction is not held for any reason,
such next succeeding Dividend Period shall, notwithstanding
such Notice of Long-Term Dividend Period, be a Short-Term
Dividend Period and the Term Selection Agent may not again
give a Notice of Long-Term Dividend Period (and any such
notice shall be null and void) for such Series until
Sufficient Clearing Bids have been made in an Auction with
respect to a Short-Term Dividend Period for such Series.
(ix) Not later than noon on the Business Day immediately
preceding each Dividend Payment Date with respect to which
dividends on any shares of Auction Preferred have been
declared, the Corporation shall irrevocably deposit with
the Paying Agent sufficient funds for the payment of such
dividends and shall give the Paying Agent irrevocable
instructions to apply such funds and, if applicable, the
income and proceeds therefrom, to the payment of such
dividends.
(x) Each dividend on the shares of any Series declared by
the Board of Directors of the Corporation shall be paid to
Holders of such shares as such Holders' names appear on
the Stock Books on the related record date, which shall be
the opening of business on the Business Day immediately
preceding the Dividend Payment Date for such dividend.
Subject to paragraph 3(d)(i) below, dividends on the
shares of any Series of Auction Preferred in arrears for
<PAGE>
B-17
any past Dividend Period (and for any past Dividend
Quarter during a Long-Term Dividend Period) may be
declared by the Board of Directors of the Corporation and
paid on any date fixed by the Board of Directors of the
Corporation, on a regular Dividend Payment Date or
otherwise, to Holders of such shares as such Holders'
names appear on the Stock Books on the related record date
fixed by the Board of Directors of the Corporation, which
shall not be more than 15 days before the date fixed for
the payment of such dividends.
(c)(i)(A) The initial Dividend Rate for the initial
Dividend Period for Series O Preferred shall be 4.515%
per annum and for Series P Preferred shall be 4.515% per
annum. The dividend rate on the shares of each Series
for each subsequent Dividend Period shall be the rate
per annum determined for such Series pursuant to
paragraph 8 below; provided, however, that in the event
that an Auction for any Dividend Period for any Series
is not held for any reason (other than as a result of
the existence of a Failure to Deposit on the Auction
Date for such Dividend Period), the dividend rate on the
shares of such Series for such Dividend Period shall be
the Non-Auction Rate on the Auction Date with respect to
such Dividend Period. The "Non-Auction Rate" for any
Series on an Auction Date for such Series shall be the
greater of (x) the Applicable Rate in effect for such
Series immediately prior to such Auction Date or (y) the
Maximum Applicable Rate in effect on such Auction Date
for a Short-Term Dividend Period, regardless of whether
an Auction is held. The dividend rate on the shares of
any Series for any Dividend Period or part thereof
determined as set forth in this paragraph 3(c) is
referred to herein as the "Applicable Rate" for such
Series for such Dividend Period or part thereof.
(B) In the event a Failure to Deposit occurs prior to
the beginning of a Dividend Period and is not cured in
accordance with the next succeeding sentence, Auctions
for such Series will be suspended, until such time as
set forth below, and the Applicable Rate for shares of
such Series for each Dividend Period (until Auctions
are resumed) commencing after such Failure to Deposit
shall be equal to 200% of LIBOR on the first day of
each such Dividend Period and each such Dividend
Period shall be a Short-Term Dividend Period. Any
such Failure to Deposit with respect to the shares of
any Series shall be deemed cured if by 12:00 noon, New
York City time, on the third Business Day next
succeeding any such Failure to Deposit, the
Corporation shall have deposited with the Auction
<PAGE>
B-18
Agent all accumulated and unpaid dividends on the
shares of such Series, including the full amount of
any dividends to be paid with respect to the Dividend
Period with respect to which such Failure to Deposit
occurred, plus an amount computed by multiplying (i)
200% of the 60-Day "AA" Composite Commercial Paper
Rate for the Dividend Period during which such Failure
to Deposit occurred on the Dividend Payment Date for
such Dividend Period by (ii) a fraction, the numerator
of which shall be the number of days for which such
Failure to Deposit is not cured in accordance with
this sentence (including the day such Failure to
Deposit occurs and excluding the day such Failure to
Deposit is cured) and the denominator of which shall
be 360, and applying the rate obtained against the
aggregate liquidation preference of the shares of such
Series then outstanding.
(C) In the event a Failure to Deposit occurs during
a Long-Term Dividend Period, the Applicable Rate for
such Dividend Period shall remain unchanged, and an
additional amount computed by multiplying (i) 200% of
LIBOR on the date on which such Failure to Deposit
occurred by (ii) a fraction, the numerator of which
shall be the number of days for which such Failure to
Deposit is not cured (including the day such Failure
to Deposit occurs and excluding the day such Failure
to Deposit is cured) and the denominator of which
shall be 360, and applying the rate obtained against
accumulated dividends not paid when due, shall
accumulate as additional dividends on the shares of
such Series of Auction Preferred. In the event
that such Failure to Deposit is not cured prior to
the next succeeding Auction Date for shares of such
Series, Auctions for such Series shall be suspended,
the next succeeding Dividend Period shall be a
Short-Term Dividend Period and the Applicable Rate
shall be equal to 200% of LIBOR on the first day of
such Dividend Period. Thereafter until such Failure
to Deposit shall have been cured and full and
cumulative dividends on the shares of such Series
shall have been paid in full or the Board of
Directors of the Corporation shall have declared a
dividend in such amount and funds sufficient for the
payment thereof shall have been irrevocably deposited
with the Paying Agent, each subsequent Dividend
Period and Applicable Rate for such Series will be
determined pursuant to the next preceding paragraph.
(D) If prior to an Auction Date for shares of such
Series, full and cumulative dividends shall have been
<PAGE>
B-19
paid in full or the Board of Directors of the
Corporation shall have declared a dividend in such
amount and funds sufficient for the payment thereof
shall have been irrevocably deposited with the Paying
Agent, Auctions for such Series will resume.
(ii) The amount of dividends per share of any Series of the
Auction Preferred payable for each Dividend Period (or for
each Dividend Quarter during any Long-Term Dividend Period)
for any such Series shall be computed by multiplying the
Applicable Rate for each Dividend Period (or Dividend
Quarter) by a fraction the numerator of which shall be the
number of days in the Dividend Period (or Dividend Quarter)
(calculated by counting the first day thereof but excluding
the last day thereof) such share was outstanding and the
denominator of which shall be 360 and multiplying the amount
so obtained by $100,000.
(d)(i) Except as hereinafter provided, no dividends shall
be declared or paid or set apart for payment on the shares
of any Series for any period unless full cumulative
dividends have been or contemporaneously are declared and
paid on each of the other Series through the most recent
applicable Dividend Payment Date for each Series. No
interest, or sum of money in lieu ofinterest, shall be
payable in respect of any dividend payment or payments on
the shares of Auction Preferred which may be in arrears.
(ii) So long as any shares of Auction Preferred are
Outstanding, the Corporation shall not declare, pay or set
apart for payment any dividend (other than a dividend in
shares of, or options, warrants or rights to subscribe for
or purchase shares of, Common Stock or Junior Stock (as
defined below)) or other distribution in respect of its
Common Stock or any other stock of the Corporation ranking
junior to the shares of Auction Preferred as to dividends or
upon liquidation ("Junior Stock"), or call for redemption,
redeem, purchase or otherwise acquire for consideration any
shares of its Common Stock or Junior Stock (except by
conversion into or exchange for other shares of Common Stock
or Junior Stock) unless full cumulative dividends on all
shares of Auction Preferred for all past Dividend Periods
(and for all past Dividend Quarters) shall have been
declared and paid (or declared and a sum sufficient for the
payment of the dividends set apart for payment). No
dividends shall be declared or paid or set apart for payment
on any shares of Auction Preferred for any period unless
full cumulative dividends have been or contemporaneously are
declared and paid on each of the shares of Auction Preferred
and Parity Preferred through the most recent applicable
Dividend Payment Date for such shares.
<PAGE>
B-20
(iii) Any dividend payment made on shares of Auction
Preferred shall first be credited against the dividends
accumulated with respect to the earliest Dividend Period
(or, if applicable, the earliest Dividend Quarter) for which
dividends have not been paid.
(e) The Corporation may not purchase or otherwise acquire
any shares of Auction Preferred during any period when
dividend payments on any Outstanding shares of Auction
Preferred or Parity Preferred are in arrears.
4. Rights on Liquidation or Cash-Out Merger. (a) Upon
the liquidation, dissolution or winding up of the affairs of
the Corporation, whether voluntary or involuntary, holders of
Auction Preferred shall be entitled to receive, out of assets
of the Corporation available for distribution to stockholders
after satisfying claims of creditors but before any payment or
distribution on the Common Stock or on any other class of stock
ranking junior to the shares of Auction Preferred upon
liquidation ("Junior Liquidation Stock"), a liquidating
distribution in the amount of $100,000 per share, which shall
be the liquidation preference of such shares, plus an amount
equal to accumulated and unpaid dividends on each such share
(whether or not declared) to and including the date of final
dissolution. Unless and until payment in full has been made to
holders of shares of Auction Preferred of the liquidating
distributions to which they are entitled as provided in this
Section 4, no dividends or distributions shall be made to
holders of the Common Stock or the Junior Liquidation Stock, no
payment or delivery or commitment to make payment or delivery
of any money or assets to any Affiliate shall be made and no
purchase, redemption or other acquisition for any consideration
by the Corporation shall be made in respect of the Common Stock
or the Junior Liquidation Stock. After the payment to holders
of shares of Auction Preferred of the full amount of the
liquidating distributions to which they are entitled pursuant
to the second next preceding sentence, holders of the shares of
Auction Preferred (in their capacity as such holders) shall
have no right or claim to any of the remaining assets of the
Corporation.
(b) In any merger or consolidation of the Corporation
with or into any other corporation, including any Affiliate, or
a merger or consolidation of any other corporation, including
any Affiliate, with or into the Corporation, which merger or
consolidation by its terms provides for the payment of only
cash to holders of the Auction Preferred, each holder of
Auction Preferred shall be entitled to receive an amount equal
to the liquidation preference of the shares of Auction
Preferred held by such holder, any Merger Premium, plus an
amount equal to accumulated and unpaid dividends on such shares
to and including the date of payment thereof, and no more, in
<PAGE>
B-21
exchange for such shares of Auction Preferred (a "Cash-Out
Merger").
(c) Neither the sale, lease or exchange (for cash, stock,
securities or other consideration) of all or substantially all
of the property and assets of the Corporation, nor the merger
or consolidation of any other corporation with or into the
Corporation, nor the merger or consolidation of the Corporation
with or into any other corporation, shall be deemed to be a
dissolution, liquidation or winding up of the affairs of the
Corporation, voluntary or involuntary, for the purposes of this
Section 4; provided, however, that any Cash-Out Merger shall be
deemed to be a liquidation of the Corporation solely for
purposes of determining the rights of the holders of shares of
Auction Preferred in respect of such Cash-Out Merger.
(d) If upon liquidation, dissolution or winding up of the
affairs of the Corporation, whether voluntary or involuntary,
the assets of the Corporation available for distribution to the
holders of Auction Preferred and any other preferred stock of
the Corporation, including the Flexible Rate Auction Preferred
Stock, the Series A Preferred Stock, the Series B Preferred
Stock, the Series C Preferred Stock and the Series D Preferred
Stock, ranking upon liquidation on a parity with the Auction
Preferred (the "Liquidation Preferred"), shall be insufficient
to pay the full amount of the liquidating distributions to
which holders of Auction Preferred are entitled pursuant to
Section 4(a) above and liquidating distributions to which
holders of the Liquidation Preferred are entitled, then such
assets shall be distributed among the holders of Auction
Preferred and Liquidation Preferred ratably in proportion to
the full amount of distributions to which each holder of
Auction Preferred and Liquidation Preferred would have been
entitled.
5. Voting Rights. (a) Election of Directors. Holders
of the shares of Auction Preferred and shares of Voting
Preferred shall have the right, voting as a single class
together with holders of all other shares of preferred stock of
the Corporation, including the Flexible Rate Auction Preferred
Stock, the Series A Preferred Stock, the Series B Preferred
Stock, the Series C Preferred Stock and the Series D Preferred
Stock, ranking on a parity with the shares of Auction Preferred
as to the payment of dividends ("Parity Preferred"), to elect a
number of directors of the Corporation (the "Regular Preferred
Directors") which is equal to the smallest whole number that is
not less than 25% of the directors of the Corporation. Holders
of all such stock shall vote in such elections on the basis of
one vote per $100,000 liquidation preference and not
cumulatively and the holder or holders of one-third of the
shares of such stock then Outstanding, present in person or by
<PAGE>
B-22
proxy, shall constitute a quorum for the election of directors
by them.
(b) Other Matters. On all matters other than the
election of directors as to which stockholders generally have a
vote, each share of Auction Preferred and Voting Preferred
shall be entitled to such number of votes as determined below
and each share of Common Stock will be entitled to one vote.
The shares of Auction Preferred shall vote together as a single
class with all shares of Common Stock and all other shares of
preferred stock, including the Flexible Rate Auction Preferred
Stock, the Series A Preferred Stock, the Series B Preferred
Stock, the Series C Preferred Stock and the Series D Preferred,
which have all the same voting rights as conferred upon the
Auction Preferred in Section 5(a) and this Section 5(b) (the
"Voting Preferred"). Holders of shares of Auction Preferred
and Voting Preferred shall be entitled to the number of votes
determined pursuant to the following formula per $100,000
liquidation preference:
X = [(Y divided by .75) minus Y] divided by Z
X: number of votes per share of Auction Preferred and
Voting Preferred per $100,000 liquidation preference.
Y: number of shares of outstanding Common Stock on the
applicable record date.
Z: amount equal to (I) number of shares of Outstanding
Auction Preferred on the applicable record date plus
(II) sum of the liquidation preference of all
Outstanding Voting Preferred on the applicable record
date divided by 100,000.
The Corporation shall mail or cause the Auction Agent to mail
to Holders of shares of Auction Preferred notice of any meeting
of stockholders not less than 20 days nor more than 60 days
prior to the date fixed for such meeting. Except as provided
in Section 5(c), the number of directors of the Corporation
shall be determined in accordance with the By-Laws of the
Corporation.
(c) Right to Elect Two Additional Members of the Board of
Directors. (i) During any period (referred to herein as a
"Default Period") when dividend payments on any shares of
Auction Preferred or Parity Preferred for such number of
Dividend Periods or portions thereof (or the equivalent thereof
in the case of Parity Preferred), which in the aggregate
contain at least 540 days, shall not have been paid or declared
and a sum sufficient for the payment thereof set aside for
payment, then in any such case the number of directors of the
Corporation shall automatically be increased by two additional
directors and the holders of the shares of Auction Preferred
<PAGE>
B-23
and Parity Preferred shall possess full voting powers (to the
exclusion of the holders of all other series and classes of
capital stock of the Corporation), voting as a single class, to
elect such two directors (the "Special Preferred Directors").
(ii) The Default Period and voting rights created by the
occurrence of the circumstances described in Section
5(c)(i) shall continue unless and until all accumulated
and unpaid dividends on any of the then Outstanding shares
of Auction Preferred and Parity Preferred, including in
the case of Auction Preferred the accumulated and unpaid
dividends for the current Dividend Period or Dividend
Quarter, as the case may be, shall have been paid or
sufficient funds for the payment thereof shall have been
deposited with the Auction Agent, at which time the voting
rights described in Section 5(c)(i) shall cease, subject
always, however, to the revesting of such voting power in
the holders of all shares of Auction Preferred and Parity
Preferred upon the further occurrence of any of the
circumstances described in Section 5(c)(i) above.
(iii) The term of office of all persons who are directors
of the Corporation at the time of the special meeting
referred to in Section 5(c)(v) below shall continue,
notwithstanding the election of Special Preferred
Directors at such meeting by the holders of shares of
Auction Preferred and Parity Preferred. The Regular
Preferred Directors and the Special Preferred
Directors, together with the incumbent directors elected
by the holders of the Common Stock, shall constitute the
duly elected directors of the Corporation.
(iv) Simultaneously with the expiration of the Default
Period, the term of office of the Special Preferred Directors
elected by the holders of shares of Auction Preferred and
Parity Preferred at the special meeting referred to in Section
5(c)(v) below shall terminate, the number of directors of the
Corporation shall automatically be decreased by two, only the
Regular Preferred Directors and the incumbent directors
otherwise elected by the holders of the Common Stock shall
constitute the duly elected directors of the Corporation, and
the right of the holders of Auction Preferred and Parity
Preferred to elect directors during a Default Period as
provided above shall cease.
(v) Within five days following the accrual of any right
of the holders of shares of Auction Preferred and Parity
Preferred to elect directors upon the occurrence of a Default
Period as described in Section 5(c)(i), the Corporation shall
mail or cause to be mailed to the holders of Auction Preferred
and Parity Preferred notice of a special meeting of
<PAGE>
B-24
stockholders for a date not less than 20 days nor more than 60
days after the date of such notice. If the Corporation does
not mail or cause to be mailed notice of such meeting as
provided in the next preceding sentence, a meeting may be
called by any holder of Auction Preferred or Parity Preferred.
The Corporation shall notify the Auction Agent of the date on
which such right accrued, and such date shall be the record
date for determining the holders of stock entitled to notice of
and to vote at the special meeting. Holders of all such stock
shall vote in such elections on the basis of one vote per
$100,000 liquidation preference and not cumulatively and the
holder or holders of one-third of the shares of such stock then
Outstanding, present in person or by proxy, shall constitute a
quorum for the election of directors by them. At any such
meeting or adjournment thereof in the absence of a quorum, a
majority of the holders of such stock present in person or by
proxy shall have the power to adjourn the meeting for the
election of directors without notice, other than an
announcement at the meeting, until a quorum is present.
(d) Removal of Regular Preferred Directors and Special
Preferred Directors. Except as provided in Section 5(c)(iv),
Regular Preferred Directors and Special Preferred Directors
shall (subject to the provisions of any applicable law) be
subject to removal only by the vote of the holders of a
majority of the Outstanding shares of Auction Preferred, Voting
Preferred and Parity Preferred in the case of Regular Preferred
Directors, and the holders of a majority of the Outstanding
shares of Auction Preferred and Parity Preferred in the case of
Special Preferred Directors, in each case, voting together as a
single class. Any vacancy in the Board of Directors of the
Corporation occurring by reason of such removal or otherwise
may be filled by vote of a majority of the Outstanding shares
of Auction Preferred, Voting Preferred and Parity Preferred in
respect of any Regular Preferred Director and by a vote of a
majority of the Outstanding shares of Auction Preferred and
Parity Preferred in respect of any Special Preferred Director,
in each case, voting together as a single class, in person or
by proxy at a special meeting of stockholders called and held
in accordance with the provisions set forth above, and, if not
so filled, such vacancy shall (subject to the provisions of any
applicable law) be filled by a vote of a majority of the
remaining Regular Preferred Directors and any Special Preferred
Directors.
(e) Right to Vote in Certain Events. (i) Without the
affirmative vote of the Holders of at least two-thirds of the
Outstanding shares of Auction Preferred voting in person or by
proxy at a special meeting for the purpose, or the unanimous
written consent of the Holders of the Outstanding shares of
Auction Preferred acting without such a meeting (subject to the
provisions of any applicable law), the Corporation may not
<PAGE>
B-25
amend, alter or repeal any provisions of this Certificate of
Designations or the Certificate of Incorporation so as to
affect adversely the preferences, special rights or powers of
the shares of Auction Preferred. Any increase in the
authorized number of any series of capital stock ranking on a
parity with the Auction Preferred with respect to the payment
of dividends or the distribution of assets, or creation,
authorization or issuance of any securities convertible into,
or warrants, options or similar rights to purchase, acquire or
receive, shares of such capital stock or reclassification of
any authorized capital stock of the Corporation into any share
ranking on a parity with the Auction Preferred with respect to
the payment of dividends or the distribution of assets shall be
deemed not to affect adversely the preferences, special rights
or powers of the shares of Auction Preferred.
(ii) Without the affirmative vote of the holders of at
least two-thirds of the Outstanding shares of Auction
Preferred and Parity Preferred, voting together as a
single class, in person or by proxy at a special meeting
for the purpose, or the unanimous written consent of the
Holders of the Outstanding shares of Auction Preferred and
Parity Preferred acting without such a meeting (subject to
the provisions of any applicable law), the Corporation may
not create, authorize or issue shares of any class or
series of capital stock ranking senior to the shares of
Auction Preferred and Parity Preferred with respect to the
payment of dividends or the distribution of assets, or
create, authorize or issue any securities convertible
into, or warrants, options or similar rights to
purchase, acquire or receive, shares of capital stock
ranking senior to the shares of Auction Preferred and
Parity Preferred with respect to the payment of dividends
or the distribution of assets or reclassify any authorized
capital stock of the Corporation into any shares ranking
senior to the shares of Auction Preferred and Parity
Preferred with respect to the payment of dividends or the
distribution of assets.
(iii) Without the affirmative vote of the holders of a
majority of the Outstanding shares of Auction Preferred,
Voting Preferred and Parity Preferred, voting together as
a single class, in person or by proxy at a special meeting
for the purpose, or the unanimous written consent of the
Holders of the Outstanding shares of Auction Preferred,
Voting Preferred and Parity Preferred acting without such
a meeting (subject to the provisions of any applicable
law), the Corporation may not sell, lease or convey all or
substantially all of the assets of the Corporation, or
consolidate or merge with or into any other corporation
unless, in the case of a consolidation or merger, each
<PAGE>
B-26
holder of shares of Auction Preferred, Voting Preferred
and Parity Preferred shall receive, upon such
consolidation or merger, an amount in cash equal to the
liquidation preference, Merger Premium, if any, and
accumulated and unpaid dividends through the date of
payment of such shares of Auction Preferred, Voting
Preferred and Parity Preferred in exchange for such shares
of Auction Preferred, Voting Preferred and Parity
Preferred.
(f) No Right to Vote in Certain Events. With respect to
any right of the holders of shares of Auction Preferred to vote
on any matter, whether such right is created by this
Certificate of Designations, by applicable law or otherwise, no
Holder of any share of Auction Preferred shall be entitled to
vote and no share of Auction Preferred shall be deemed to be
Outstanding for the purpose of voting or determining the number
of shares required to constitute a quorum, if prior to or
concurrently with a determination of shares entitled to vote or
of shares deemed Outstanding for quorum purposes, as the case
may be, such share is held beneficially or of record by the
Corporation or any Affiliate of the Corporation.
6. Exclusive Remedy. In the event that dividends are
not timely declared on the shares of Auction Preferred, the
exclusive remedy of Holders against the Corporation shall be as
set forth in this Certificate of Designations and in no event
shall Holders of such shares have any right to maintain a suit
or proceeding against the Corporation in respect of such
dividends or damages for the failure to receive the same or
resulting from such noncompliance.
7. Additional Agreements. (a) Term Selection Agent.
The Corporation shall use its best efforts to maintain a Term
Selection Agent with respect to Series O Preferred and Series P
Preferred to act in accordance with the provisions set forth in
this Certificate of Designations with respect to each such
Series.
(b) Auction Agent. The Corporation shall use its best
efforts to maintain an Auction Agent with respect to Series O
Preferred and Series P Preferred to act in accordance with the
provisions set forth in this Certificate of Designations with
respect to each such Series.
8. Auction Procedures. (a) Certain Definitions.
Capitalized terms not defined in this paragraph 8 shall have
the respective meanings specified in paragraphs 1 through 7
above of this Certificate of Designations. As used in this
paragraph 8, the following terms shall have the following
meanings, unless the context otherwise requires:
<PAGE>
B-27
(i) "Affiliate" shall mean any Person known to the
Auction Agent to be controlled by, in control of or under
common control with the Corporation and shall include,
for purposes of this paragraph, Ford Motor Company and
its Affiliates other than the Corporation.
(ii) "Agent Member" shall mean the member of the
Securities Depository that will act on behalf of a Bidder
and is identified as such in such Bidder's Purchaser's
Letter.
(iii) "Auction" shall mean the periodic operation of the
procedures set forth in this paragraph 8.
(iv) "Auction Date" shall mean the Business Day next
preceding the first day of each Dividend Period for a
Series after the initial Dividend Period for such Series.
(v) "Auction Preferred" shall mean shares of a Series
subject to an Auction on any Auction Date.
(vi) "Available Auction Preferred" shall have the
meaning specified in paragraph 8(d)(i) below.
(vii) "Bid" shall have the meaning specified in
paragraph 8(b)(i) below.
(viii) "Bidder" shall have the meaning specified in
paragraph 8(b)(i) below.
(ix) "Broker-Dealer" shall mean any broker-dealer, or
other entity permitted by law to perform the functions
required of a Broker-Dealer in this paragraph 8, that has
been selected by the Corporation and has entered into a
Broker-Dealer Agreement with the Auction Agent that
remains effective.
(x) "Broker-Dealer Agreement" shall mean an agreement
between the Auction Agent and a Broker-Dealer pursuant to
which such Broker-Dealer agrees to follow the procedures
specified in this paragraph 8.
(xi) "Existing Holder" when used with respect to shares
of Auction Preferred, shall mean a Person who has signed
a Purchaser's Letter and is listed as the beneficial
owner of such shares of Auction Preferred in the records
of the Auction Agent.
(xii) "Hold Order" shall have the meaning specified in
paragraph 8(b)(i) below.
(xiii) "Order" shall have the meaning specified in
paragraph 8(b)(i) below.
<PAGE>
B-28
(xiv) "Outstanding" shall mean, as of any date, shares
of Auction Preferred theretofore issued by the
Corporation except, without duplication, (A) any shares
of Auction Preferred theretofore cancelled or delivered
to the Auction Agent for cancellation, (B) any shares of
Auction Preferred as to which the Corporation or any
Affiliate thereof shall be an Existing Holder and (C) any
shares of Auction Preferred represented by any
certificate in lieu of which a new certificate has been
executed and delivered by the Corporation.
(xv) "Person" shall mean and include an individual, a
partnership, a corporation, a trust, an unincorporated
association, a joint venture or other entity or a
government or any agency or political subdivision
thereof.
(xvi) "Potential Holder" shall mean any Person,
including any Existing Holder, (A) who shall have
executed a Purchaser's Letter and (B) who may be
interested in acquiring shares of Auction Preferred (or,
in the case of an Existing Holder, additional shares of
Auction Preferred).
(xvii) "Purchaser's Letter" shall mean a letter
addressed to the Corporation, the Auction Agent and a
Broker-Dealer in which a Person agrees, among other
things, to offer to purchase, purchase, offer to sell
and/or sell shares of Auction Preferred as set forth in
this paragraph 8.
(xviii) "Securities Depository" shall mean The
Depository Trust Company and its successors and assigns
or any other securities depository selected by the
Corporation which agrees to follow the procedures
required to be followed by such securities depository in
connection with shares of Auction Preferred.
(xix) "Sell Order" shall have the meaning specified in
paragraph 8(b)(i) below.
(xx) "shares," for the purposes of this paragraph 8,
shall mean shares of Auction Preferred.
(xxi) "Submission Deadline" shall mean 12:30 p.m., New
York City time, on any Auction Date or such other time on
any Auction Date by which Broker-Dealers are required to
submit Orders to the Auction Agent as specified by the
Auction Agent from time to time.
(xxii) "Submitted Bid" shall have the meaning specified
in paragraph 8(d)(i) below.
<PAGE>
B-29
(xxiii) "Submitted Hold Order" shall have the meaning
specified in paragraph 8(d)(i) below.
(xxiv) "Submitted Order" shall have the meaning
specified in paragraph 8(d)(i) below.
(xxv) "Submitted Sell Order" shall have the meaning
specified in paragraph 8(d)(i) below.
(xxvi) "Sufficient Clearing Bids" shall have the meaning
specified in paragraph 8(d)(i) below.
(xxvii) "Winning Bid Rate" shall have the meaning
specified in paragraph 8(d)(i) below.
(b) Orders by Existing Holders and Potential Holders.
(i) On or prior to each Auction Date:
(A) each Existing Holder may submit to a
Broker-Dealer information as to:
(1) the number of Outstanding shares, if any, of
Auction Preferred held by such Existing Holder
which such Existing Holder desires to continue to
hold without regard to the Applicable Rate for
the next succeeding Dividend Period;
(2) the number of Outstanding shares, if any, of
Auction Preferred that such Existing Holder
desires to continue to hold, provided that the
Applicable Rate for the next succeeding Dividend
Period shall not be less than the rate per annum
specified by such Existing Holder; and/or
(3) the number of Outstanding shares, if any, of
Auction Preferred held by such Existing Holder
which such Existing Holder offers to sell without
regard to the Applicable Rate for the next
succeeding Dividend Period; and
(B) each Broker-Dealer, using a list of Potential
Holders that shall be maintained by such Broker-Dealer
in good faith for the purpose of conducting a
competitive Auction, shall contact Potential Holders,
including Persons that are not Existing Holders, on such
list to determine the number of shares, if any, of
Auction Preferred that each such Potential Holder offers
to purchase, provided that the Applicable Rate for the
next succeeding Dividend Period shall not be less than
the rate per annum specified by such Potential Holder.
<PAGE>
B-30
For the purposes hereof, the communication to a
Broker-Dealer of the information referred to in this
paragraph 8(b)(i) is hereinafter referred to as an
"Order" and each Existing Holder and each Potential
Holder placing an Order is hereinafter referred to as a
"Bidder"; an Order containing the information referred
to in clause (A)(1) of this paragraph 8(b)(i) is
hereinafter referred to as a "Hold Order"; an Order
containing the information referred to in clause (A)(2)
or (B) of this paragraph 8(b)(i) is hereinafter referred
to as a "Bid"; and an Order containing the information
referred to in clause (A)(3) of this paragraph 8(b)(i)
is hereinafter referred to as a "Sell Order."
(ii)(A) A Bid by an Existing Holder shall constitute an
irrevocable offer to sell:
(1) the number of Outstanding shares of Auction
Preferred specified in such Bid if the Applicable
Rate determined on such Auction Date shall be less
than such specified rate; or
(2) such number or a lesser number of Outstanding
shares of Auction Preferred to be determined as set
forth in paragraph 8(e)(i)(D) if the Applicable
Rate determined on such Auction Date shall be equal
to such specified rate; or
(3) such number or a lesser number of Outstanding
shares of Auction Preferred to be determined as set
forth in paragraph 8(e)(ii)(C) if such specified
rate shall be higher than the Maximum Applicable
Rate and Sufficient Clearing Bids do not exist.
(B) A Sell Order by an Existing Holder shall constitute
an irrevocable offer to sell:
(1) the number of Outstanding shares of Auction
Preferred specified in such Sell Order; or
(2) such number or a lesser number of Outstanding
shares of Auction Preferred as set forth in
paragraph 8(e)(ii)(C) if Sufficient Clearing Bids do
not exist.
(C) A Bid by a Potential Holder shall constitute an
irrevocable offer to purchase:
(1) the number of Outstanding shares of Auction
Preferred specified in such Bid if the Applicable
Rate determined on such Auction Date shall be higher
than such specified rate; or
<PAGE>
B-31
(2) such number or a lesser number of Outstanding
shares of Auction Preferred as set forth in paragraph
8(e)(i)(E) if the Applicable Rate determined on such
Auction Date shall be equal to such specified rate.
(c) Submission of Orders by Broker-Dealers to Auction Agent.
(i) Each Broker-Dealer shall submit in writing to the
Auction Agent prior to the Submission Deadline on each
Auction Date all Orders obtained by such Broker-Dealer and
specifying with respect to each Order:
(A) the name of the Bidder placing such Order;
(B) the aggregate number of shares of Auction
Preferred that are the subject of such Order;
(C) to the extent that such Bidder is an Existing
Holder:
(1) the number of shares, if any, of Auction
Preferred subject to any Hold Order placed by
such Existing Holder;
(2) the number of shares, if any, of Auction
Preferred subject to any Bid placed by such
Existing Holder and the rate specified in such
Bid; and
(3) the number of shares, if any, of Auction
Preferred subject to any Sell Order placed by
such Existing Holder; and
(D) to the extent that such Bidder is a Potential
Holder, the rate and the number of shares of Auction
Preferred specified in such Potential Holder's Bid.
(ii) If any rate specified in any Bid contains
more than three figures to the right of the
decimal point, the Auction Agent shall round
such rate up to the next highest one thousandth
(.001) of 1%.
(iii) If an Order or Orders covering all of the
Outstanding shares of Auction Preferred held by
an Existing Holder is not submitted to the
Auction Agent prior to the Submission Deadline,
the Auction Agent shall deem a Hold Order to
have been submitted on behalf of such Existing
Holder covering the number of Outstanding shares
of Auction Preferred held by such Existing
Holder and not subject to Orders submitted to
<PAGE>
B-32
the Auction Agent.
(iv) If one or more Orders covering in the
aggregate more than the number of Outstanding
shares of Auction Preferred held by the Existing
Holder are submitted to the Auction Agent, such
Orders shall be considered valid as follows and
in the following order of priority:
(A) any Hold Order submitted on behalf of
such Existing Holder shall be considered valid
up to and including the number of Outstanding
shares of Auction Preferred held by such
Existing Holder; provided that if more than
one Hold Order is submitted on behalf of such
Existing Holder and the number of shares of
Auction Preferred subject to such Hold Orders
exceeds the number of outstanding shares of
Auction Preferred held by such Existing
Holder, the number of shares of Auction
Preferred subject to such Hold Orders
shall be reduced pro rata so that such Hold
Orders shall cover the number of Outstanding
shares of Auction Preferred held by such
Existing Holder.
(B)(1) any Bid shall be considered valid
up to and including the excess of the
number of Outstanding shares of Auction
Preferred held by such Existing Holder
over the number of shares of Auction
Preferred subject to Hold Orders referred
to in paragraph 8(c)(iv)(A);
(2) subject to clause (1) above, if more
than one Bid with the same rate is
submitted on behalf of such Existing Holder
and the number of Outstanding shares of
Auction Preferred subject to such Bids is
greater than such excess, the number of
shares of Auction Preferred subject to such
Bids shall be reduced pro rata so that such
Bids shall cover the number of shares of
Auction Preferred equal to such excess; and
(3) subject to clause (1) above, if more
than one Bid with different rates is
submitted on behalf of such Existing
Holder, such Bids shall be considered valid
in the ascending order of their respective
rates and in any such event the number, if
<PAGE>
B-33
any, of such Outstanding shares subject to
Bids not valid under this clause (B) shall
be treated as the subject of a Bid by a
Potential Holder; and
(C)(1) any Sell Order shall be considered
valid up to and including the excess of the
number of Outstanding shares of Auction
Preferred held by such Existing Holder over
the number of shares of Auction Preferred
subject to Hold Orders referred to in
paragraph 8(c)(iv)(A) and Bids referred to
in paragraph 8(c)(iv)(B); and
(2) subject to clause (1) above, if more
than one Sell Order is submitted on behalf of
such Existing Holder and the number of
Outstanding shares of Auction Preferred
subject to such Sell Orders is greater than
such excess, the number of shares of Auction
Preferred subject to such Sell Orders shall
be reduced pro rata so that such Sell Orders
shall cover the number of shares of Auction
Preferred equal to such excess.
(v) If more than one Bid is submitted on behalf of any
Potential Holder, each bid submitted shall be a separate
Bid with the rate and number of shares of Auction
Preferred therein specified.
(d) Determination of Sufficient Clearing Bids,
Winning Bid Rate and Applicable Rate.
(i) Not earlier than the Submission Deadline on
each Auction Date, the Auction Agent shall
assemble all Orders submitted or deemed submitted
to it by the Broker-Dealers (each such Order as
submitted or deemed submitted by a Broker-Dealer
being hereinafter referred to individually as a
"Submitted Hold Order," a "Submitted Bid" or a
"Submitted Sell Order," as the case may be, or as
a "Submitted Order") and shall determine:
(A) the excess of the total number of Outstanding
shares of Auction Preferred over the number of
Outstanding shares of Auction Preferred that are the
subject of Submitted Hold Orders (such excess being
hereinafter referred to as the "Available Auction
Preferred");
(B) from the Submitted Orders whether:
<PAGE>
B-34
(1) the number of Outstanding shares of Auction
Preferred that are the subject of Submitted Bids
by Potential Holders specifying one or more rates
equal to or lower than the Maximum Applicable Rate
exceeds or is equal to the sum of:
(2)(x) the number of Outstanding shares of
Auction Preferred that are the subject of
Submitted Bids by Existing Holders specifying one
or more rates higher than the Maximum Applicable
Rate; and
(y) the number of Outstanding shares of Auction
Preferred that are subject to Submitted Sell
Orders
(if such excess or such equality exists (other
than because the number of shares of Auction
Preferred in clauses (x) and (y) are each zero
because all of the Outstanding shares of Auction
Preferred are the subject of Submitted Hold
Orders), such Submitted Bids in clause (1) are
hereinafter referred to collectively as
"Sufficient Clearing Bids"); and
(C) if Sufficient Clearing Bids exist, the lowest rate
specified in the Submitted Bids (the "Winning Bid Rate")
which if the Auction Agent accepted:
(1) each Submitted Bid from Existing Holders
specifying such lowest rate and all other Submitted
Bids from Existing Holders specifying lower rates,
and
(2) each Submitted Bid from Potential Holders
specifying such lowest rate and all other
Submitted Bids from Potential Holders specifying
lower rates; would result in such Existing
Holders continuing to hold an aggregate number
of Outstanding shares of Auction Preferred that,
when added to the number of Outstanding shares
of Auction Preferred to be purchased by such
Potential Holders, would equal not less than the
Available Auction Preferred.
(ii) Promptly after the Auction Agent has made the
determinations pursuant to paragraph 8(d)(i), the
Auction Agent shall advise the Corporation of the
Maximum Applicable Rate and, based on such
determinations, the Applicable Rate for the next
succeeding Dividend Period as follows:
<PAGE>
B-35
(A) if Sufficient Clearing Bids exist, that the
Applicable Rate for the next succeeding Dividend
Period shall be equal to Winning Bid Rate so
determined;
(B) if Sufficient Clearing Bids do not exist
(other than because all of the Outstanding shares
of Auction Preferred are the subject of Submitted
Hold Orders), then (a) if the Term Selection Agent
has not given a Notice of Long-Term Dividend Period
with respect to the next succeeding Dividend Period
for a Series or has given a Notice of Revocation
with respect thereto or such Notice of Long-Term
Dividend Period shall be deemed to have been
revoked, the Applicable Rate for such Series for
such next succeeding Dividend Period shall be the
Maximum Applicable Rate on the Auction Date for a
Short-Term Dividend Period and (b) if the Term
Selection Agent has given a Notice of Long-Term
Dividend Period with respect to the next succeeding
Dividend Period for a Series and has not given a
Notice of Revocation with respect thereto and such
Notice of Long-Term Dividend Period shall not have
been deemed revoked, such next succeeding Dividend
Period shall, notwithstanding such Notice of
Long-Term Dividend Period, be a Short-Term Dividend
Period, and the Applicable Rate for such next
succeeding Dividend Period shall be the greatest of
(i) the Applicable Rate in effect immediately prior
to the applicable Auction, (ii) the Maximum
Applicable Rate on the Auction Date for a
Short-Term Dividend Period or (iii) the Maximum
Applicable Rate on the Auction Date for the
specified Long-Term Dividend Period; or
(C) if all the Outstanding shares of Auction
Preferred are the subject of Submitted Hold Orders,
that the Applicable Rate for the next succeeding
Dividend Period shall (1) in the case of a Series of
Auction Preferred with a Short-Term Dividend Period,
be equal to 59% of the 60-day "AA" Composite
Commercial Paper Rate in effect on the date of such
Auction; and (2) in the case of a Series of Auction
Preferred with a Long-Term Dividend Period, 59% of
the Reference Rate in effect on the date of such
Auction.
<PAGE>
B-36
(e) Acceptance and Rejection of Submitted Bids and
Submitted Sell Orders and Allocation of Shares. Existing
Holders shall continue to hold shares of Auction Preferred that
are the subject of Submitted Hold Orders and, based on the
determinations made pursuant to paragraph 8(d)(i), the
Submitted Bids and the Submitted Sell Orders shall be accepted
or rejected and the Auction Agent shall take such other action
as set forth below:
(i) If Sufficient Clearing Bids have been made,
subject to the provisions of paragraph 8(e)(iii),
Submitted Bids and Submitted Sell Orders shall be
accepted or rejected in the following order of
priority and all other Submitted Bids shall be
rejected:
(A) the Submitted Sell Orders of Existing Holders
shall be accepted and the Submitted Bid of each of
the Existing Holders specifying any rate that is
higher than the Winning Bid Rate shall be accepted,
thus requiring each such Existing Holder to sell the
shares of Auction Preferred that are the subject of
such Submitted Bid;
(B) the Submitted Bid of each of the Existing
Holders specifying any rate that is lower than the
Winning Bid Rate shall be rejected, thus entitling
each such Existing Holder to continue to hold the
shares of Auction Preferred that are the subject of
such Submitted Bid;
(C) the Submitted Bid of each of the Potential
Holders specifying any rate that is lower than the
Winning Bid Rate shall be accepted;
(D) the Submitted Bid of each of the Existing
Holders specifying a rate that is equal to the
Winning Bid Rate shall be rejected, thus entitling
each such Existing Holder to continue to hold the
shares of Auction Preferred that are the subject of
such Submitted Bid, unless the number of Outstanding
shares of Auction Preferred subject to all such
Submitted Bids shall be greater than the number of
shares of Auction Preferred ("remaining shares")
equal to the excess of the Available Auction
Preferred over the number of shares of Auction
Preferred subject to Submitted Bids described in
paragraphs 8(e)(i)(B) and 8(e)(i)(C), in which event
the Submitted Bids of each such Existing Holder shall
be accepted, and each such Existing Holder shall be
required to sell shares of Auction Preferred, but
only in an amount equal to the difference between (1)
<PAGE>
B-37
the number of Outstanding shares of Auction Preferred
then held by such Existing Holder subject to such
Submitted Bid and (2) the number of shares of Auction
Preferred obtained by multiplying (x) the number of
remaining shares by (y) a fraction the numerator of
which shall be the number of Outstanding shares of
Auction Preferred held by such Existing Holder
subject to such Submitted Bid and the denominator of
which shall be the sum of the number of Outstanding
shares of Auction Preferred subject to such Submitted
Bids made by all such Existing Holders that specified
a rate equal to the Winning Bid Rate; and
(E) the Submitted Bid of each of the Potential
Holders specifying a rate that is equal to the
Winning Bid Rate shall be accepted but only in an
amount equal to the number of shares of Auction
Preferred obtained by multiplying the difference
between the Available Auction Preferred and the
number of shares of Auction Preferred subject to
Submitted Bids described in paragraphs 8(e)(i)(B),
8(e)(i)(C) and 8(e)(i)(D) by a fraction the
numerator of which shall be the number of Outstanding
shares of Auction Preferred subject to such Submitted
Bids and the denominator of which shall be the sum of
the number of Outstanding shares of Auction Preferred
subject to such Submitted Bids made by all such
Potential Holdersthat specified rates equal to the
Winning Bid Rate.
(ii) If Sufficient Clearing Bids have not been made
(other than because all of the Outstanding shares of
Auction Preferred are subject to Submitted Hold Orders),
subject to the provisions of paragraph 8(e)(iii),
Submitted Orders shall be accepted or rejected as follows
in the following order of priority and all other
Submitted Bids shall be rejected:
(A) the Submitted Bid of each Existing Holder
specifying any rate that is equal to or lower than
the Maximum Applicable Rate shall be rejected, thus
entitling such Existing Holder to continue to hold
the shares of Auction Preferred that are the subject
of such Submitted Bid;
(B) the Submitted Bid of each Potential Holder
specifying any rate that is equal to or lower than
the Maximum Applicable Rate shall be accepted, thus
requiring such Potential Holder to purchase the
shares of Auction Preferred that are the subject of
such Submitted Bid; and
B-38
(C) the Submitted Bids of each Existing Holder
specifying any rate that is higher than the Maximum
Applicable Rate shall be accepted and the Submitted
Sell Orders of each Existing Holder shall be accepted,
in both cases only in an amount equal to the
difference between (1) the number of Outstanding
shares of Auction Preferred then held by such Existing
Holder subject to such Submitted Bid or Submitted Sell
Order and (2) the number of shares of Auction
Preferred obtained by multiplying (x) the difference
between the Available Auction Preferred and the
aggregate number of shares of Auction Preferred
subject to Submitted Bids described in paragraphs
8(e)(ii)(A) and 8(e)(ii)(B) by (y) a fraction the
numerator of which shall be the number of Outstanding
shares of Auction Preferred held by such Existing
Holder subject to such Submitted Bid or Submitted Sell
Order and the denominator of which shall be the number
of Outstanding shares of Auction Preferred subject to
all such Submitted Bids and Submitted Sell Orders.
(iii) If, as a result of the procedures
described in paragraph 8(e)(i) or 8(e)(ii), any
Existing Holder would be entitled or required to
sell, or any Potential Holder would be entitled
or required to purchase, a fraction of a share
of Auction Preferred on any Auction Date, the
Auction Agent shall, in such manner as, in its
sole discretion, it shall determine, round up or
down the number of shares of Auction Preferred
to be purchased or sold by any Existing Holder
or Potential Holder on such Auction Date so that
the number of shares purchased or sold by each
Existing Holder or Potential Holder on such
Auction Date shall be whole shares of Auction
Preferred.
(iv) Based on the results of each Auction, the Auction
Agent shall determine the aggregate number of shares of
Auction Preferred to be purchased and the aggregate
number of shares of Auction Preferred to be sold by
Potential Holders and Existing Holders on whose behalf
each Broker-Dealer submitted Bids or Sell Orders, and,
with respect to each Broker-Dealer, to the extent that
such aggregate number of shares to be purchased and such
aggregate number of shares to be sold differ, determine
to which other Broker-Dealer or Broker-Dealers acting
for one or more purchasers such Broker-Dealer shall
deliver, or from which other Broker-Dealer or
Broker-Dealers acting for one or more sellers such
Broker-Dealer shall receive, as the case may be, shares
of Auction Preferred.
<PAGE>
B-39
(f) Miscellaneous. The Board of Directors of the
Corporation may interpret the provisions of this paragraph 8 to
resolve any inconsistency or ambiguity, remedy any formal
defect or make any other change or modification which does not
adversely affect the rights of Existing Holders of Auction
Preferred. An Existing Holder (A) may sell, transfer or
otherwise dispose of shares of Auction Preferred only pursuant
to a Bid or Sell Order in accordance with the procedures
described in this paragraph 8 or to or through a Broker-Dealer
or to a Person that has delivered a signed copy of a
Purchaser's Letter to the Auction Agent, provided that in the
case of all transfers other than pursuant to Auctions such
Existing Holder, its Broker-Dealer or its Agent Member advises
the Auction Agent of such transfer and (B) shall have the
beneficial ownership of the shares of Auction Preferred held by
it maintained in book-entry form by the Securities Depository
in the account of its Agent Member, which in turn shall
maintain records of such Existing Holder's beneficial
ownership. The Corporation and its Affiliates shall not submit
any Order in any Auction except as set forth in the next
sentence. Any Broker-Dealer that is an affiliate of the
Corporation may submit Orders in Auctions but only if such
Orders are not for its own account, except that if such
affiliated Broker-Dealer holds shares of Auction Preferred for
its own account, it must submit a Sell Order in the next
Auction with respect to such shares of Auction Preferred.
(g) Headings of Subdivisions. The headings of the
various subdivisions of this paragraph 8 are for convenience of
reference only and shall not affect the interpretation of any
of the provisions hereof.
IN WITNESS WHEREOF, FORD HOLDINGS, INC. has caused this
Certificate to be made under the seal of the Corporation and
signed by Eric A. Law, its Vice President - Controller, and
attested by Peter Sherry, Jr., its Assistant Secretary, this
21st day of June, 1995.
FORD HOLDINGS, INC.
By /s/Eric A. Law
-----------------------------
Eric A. Law
Vice President - Controller
ATTEST:
By:/s/Peter Sherry, Jr.
------------------------
Peter Sherry, Jr,
Assistant Secretary
(CORPORATE SEAL)
<PAGE>
EXHIBIT C
---------
TO BE SUBMITTED TO YOUR BROKER-DEALER WHO WILL THEN
DELIVER COPIES ON YOUR BEHALF TO THE AUCTION AGENT.
PURCHASER'S LETTER
Relating to Flexible Rate Auction Preferred Stock of
Ford Holdings, Inc.
Ford Holdings, Inc.
The Auction Agent
A Broker-Dealer
An Agent Member
Other Persons
Ladies and Gentlemen:
We may from time to time purchase, offer to purchase, offer to sell
and/or sell shares of one or more series of Flexible Rate Auction Preferred
Stock (Exchange) and/or Flexible Rate Auction Preferred Stock (together,
"Flex APS"), issued by Ford Holdings, Inc. (the "Company"), as described in
one or more prospectuses and prospectus supplements relating to the Flex APS,
including the appendices thereto (the "Prepsectus"). We agree that this
Letter shall apply to such purchases, sales and offers and to shares of Flex
APS owned by us. We understand that the dividend rate for each series of
Flex APS will generally be based on the results of Auctions as set forth in
the applicable Prospectus.
Capitalized terms used but not defined herein shall have the meanings
assigned to such terms in the Prosepctus.
We represent and agree as follows:
1. We agree that any Bid or Sell Order placed by us shall
constitute an irrevocable offer by us to purchase or sell the shares of
Flex APS subject to such Bid or Sell Order, or such lesser number of
shares of Flex APS as we shall be required to sell or purchase as a
result of such Auction, as set forth in the Prospectus, and that, if we
fail to place a Bid or Sell Order with repect to shares of Flex APS
owned by us with a Broker-Dealer on any Auction Date for such shares
or a Broker-Dealer to which we communicate a Bid or Sell Order fails to
submit such Bid or Sell Order to the Auction Agent, we shall be deemed
to have placed a Hold Order with respect to such shares of Flex APS as
described in the Prospectus. We authorize any Broker-Dealer that
submits a Bid or Sell Order as our agent in Auctions to execute
contracts for the sale of shares of Flex APS covered by such Bid or Sell
Order.
2. We agree that we will sell, transfer or otherwise dispose of any
shares of Flex APS held by us from time to time only (i) to the Company
or (ii) pursuant to a Bid or Sell Order placed in an Auction or (iii) to
or through a Broker-Dealer or (iv) to a person who has signed and
delivered a Purchaser's Letter in the form of this Letter for such
series to the Auction Agent, provided that in the case of all
dispositions other that pursuant to Auctions, we, our Broker-Dealer or
our Agent Member of the Securities Depository shall advise that Auction
Agent of such disposition.
3. We agree that ownership of shares of Flex APS shall be
represented by a global certificate registered in the name of the
Securities Depository or its nominee, that we will not been entitled to
receive any certificate representing shares of Flex APS and that our
ownership of any shares of FLex APS will be maintained in book entry
form by the Securities Depository for the account of our Agent Member,
which in turn will maintain records of our beneficial ownership. We
authorize and instruct our Agent Member to disclose to the Auction Agent
such information concerning our beneficial ownership of shares of Flex
APS as the Auction Agent shall request.
4. Our Agent Member of the Securities Depository, now The
Depository Trust Company, currently is _____________________________.
5. We understand that a restrictive legend will be placed on
certificates for the shares of Flex APS reflecting the restriction in
paragraph 3 of this Letter.
6. Our personnel authorized to place Orders with Broker-Dealers
for the purposes set forth in the Prospectus in Auctions currently
is/are _______________________, telephone number ( )________________.
7. Our taxpayer identification number is _________________.
8. This letter is not a committment by us to purchase any
shares of Flex APS.
9. The descriptions of Auction Procedures set forth in Appendix
A to the Prospectus are incorporated by reference herein and, in case
of any conflict between this Letter and any such description, such
description shall control.
10. This Letter supersedes any version of this Letter delivered
by us with respect to the Flex APS and dated earlier than the date
hereof.
Dated:___________________
(Name of Purchaser)
By:_______________________________
Printed Name:
Title:
Mailing Address of Purchaser:
<PAGE>
EXHIBIT D
---------
SETTLEMENT PROCEDURES
The following summary of Settlement Procedures sets forth the procedures
expected to be followed in connection with the settlement of each Auction
and will be incorporated by reference in the Auction Agent Agreement and each
Broker-Dealer Agreement. Nothing contained in this Appendix A constitutes
a representation by the Company that in each Auction each party referred
to herein will actually perform the procedures described herein to be
performed by such party. Capitalized terms used herein shall have the
respective meanings specified in the forepart of this Prospectus Supplement
or Appendix B hereto, as the case may be.
(a) On each Auction Date, the Auction Agent shall notify by telephone
the Broker-Dealers that participated in the Auction held on such Auction
Date and submitted an Order on behalf of any Existing Holder or Potential
Holder of:
(i) the Applicable Rate fixed by the next succeeding Dividend
Period;
(ii) whether Sufficient Clearing Bids existed for the determination
of the Applicable Rate;
(iii) if such Broker-Dealer (a "Seller's Broker-Dealer") submitted
a Bid or a Sell Order on behalf of an Existing Holder, the number of
shares, if any, of New Auction Preferred Stock then outstanding
to be held or sold by such Existing Holder;
(iv) if such Broker-Dealer (a "Buyer's Broker-Dealer") submitted
a Bid on behalf of a Potential Holder, the number of shares, if any,
of New Auction Preferred Stock to be purchased by such Potential
Holder;
(v) if the aggregate number of shares of New Auction Preferred
Stock to be sold by all Existing Holders on whose behalf such
Broker-Dealer submitted a Bid or a Sell Order exceeds the aggregate
number of shares of New Auction Preferred Stock to be purchased by all
Potential Holders on whose behalf such Broker-Dealer submitted a Bid,
the name or names of one or more Buyer's Broker-Dealers (and the Agent
Member, if any, of each such Buyer's Broker-Dealer) acting for one or
more purchasers of such excess number of shares of New Auction Preferred
Stock and the number of such shares to be purchased from one or more
Existing Holders on whose behalf such Broker-Dealer acted by one or more
Potential Holders on whose behalf such Broker-Dealer acted by one or
more Potential Holders on whose behalf each of such Buyer's
Broker-Dealer acted;
(vi) if the aggregate number of shares of New Auction Preferred
Stock to be purchased by all Potential Holders on whose behalf such
Broker-Dealer submitted a Bid exceeds the aggregate number of shares of
New Auction Preferred Stock to be sold by all Existing Holders on whose
behalf such Broker-Dealer submitted a Bid or a Sell Order, the name or
names of one or more Seller's Broker-Dealers (and the name of the Agent
Member, if any, of each such Seller's Broker-Dealer) acting for one or
more sellers of such excess number of shares of New Auction Preferred
Stock and the number of such shares to be sold to one or more Potential
Holders on whose behalf such Broker-Dealer acted by one or more Existing
Holders on whose behalf each of such Seller's Broker-Dealer acted; and
(vii) the Auction Date of the next succeeding Auction.
(b) On each Auction Date, each Broker-Dealer that submitted an Order
on behalf of any Existing Holder or Potential Holder shall:
<PAGE>
D-2
(i) in the case of a Broker-Dealer that is a Buyer's Broker-Dealer,
instruct each Potential Holder on whose behalf such Broker-Dealer
submitted a Bid that was accepted, in whole or in part, to instruct such
Potential Holder's Agent Member to pay to such Broker-Dealer (or its
Agent Member) through the Securities Depository the amount necessary to
purchase the number of shares of New Auction Preferred Stock to be
purchased pursuant to such Bid against receipt of such shares and advise
such Potential Holder of the Applicable Rate for the next succeeding
Dividend Period;
(ii) in the case of a Broker-Dealer that is a Seller's Broker-Dealer,
instruct each Existing Holder on whose behalf such Broker-Dealer
submitted a Sell Order that was accepted, in whole or in part, or a
Bid that was rejected, in whole or in part, to instruct such Existing
Holder's Agent Member to deliver to such Broker-Dealer (or its Agent
Member) through the Securities Depository the number of shares of New
Auction Preferred Stock to be sold pursuant to such Order against payment
therefor and advise any such Existing Holder that will continue to hold
shares of New Auction Preferred Stock of the Applicable Rate for the next
succeeding Dividend Period;
(iii) advise each Existing Holder on whose behalf such Broker-Dealer
submitted a Hold Order of the Applicable Rate for the next succeeding
Dividend Period;
(iv) advise each Existing Holder on whose behalf such Broker-Dealer
submitted an Order of the Auction Date of the next succeeding Auction;
and
(v) advise each Potential Holder on whose behalf such Broker-Dealer
submitted a Bid that was accepted, in whole or in part, of the Auction
Date for the next succeeding Auction.
(c) On the basis of the information provided to it pursuant to (a) above,
each Broker-Dealer that submitted a Bid or a Sell Order on behalf of a
Potential Holder or an Existing Holder shall, in such manner and at such
time or times as in its sole discretion it may determine, allocate any funds
received by it pursuant to (b)(i) above any any shares of New Auction
Preferred Stock received by it pursuant to (b)(ii) above among the Potential
Holders, if any, on which behalf such Broker-Dealer submitted Bids, the
Existing Holders, if any, on whose behalf such Broker-Dealer submitted Bids
that were rejected or Sell Orders, and any Broker-Dealer or Brokers-Dealers
identified to it by the Auction Agent pursuant to (a)(v) or (a) (vii) above.
(d) On each Auction Date,
(i) each Potential Holder and Existing Holder shall instruct
its Agent Member as provided in (b)(i) or (b)(ii) above, as the case may
be;
(ii) each Seller's Broker-Dealer which is not an Agent Member
of the Securities Depository shall instruct its Agent Member to (A) pay
through the Securities Depository to the Agent Member of the Existing
Holder delivering shares to such Broker-Dealer pursuant to (b)(ii) above
the amount necessary to purchase such shares against receipt of such
shares and (B) deliver such shares through the Securities Depository to a
Buyer's Broker-Dealer (or its Agent Member) identified to such Seller's
Broker-Dealer pursuant to (a)(v) above against payment therefor; and
(iii) each Buyer's Broker-Dealer which is not an Agent Member
of the Securities Depository shall instruct its Agent Member to (A) pay
through the Securities Depository to a Seller's Broker-Dealer (or its
Agent Member) identified pursuant to (a)(vi) above the amount necessary
to purchse the shares to be purchased pursuant to (b)(i) above against
receipt of such shares and (B) deliver such shares through the Securities
Depository to the Agent Member of the purchaser thereof against payment
therefor.
(e) On the Business Day next succeeding the Auction Date,
<PAGE>
D-3
(i) each Bidder's Agent Member referred to in (d)(i) above shall
instruct the Securities Depository to execute the transactions described
under (b)(i) or (b)(ii) above, and the Securities Depository shall
execute such transactions;
(ii) each Seller's Broker-Dealser or its Agent Member shall instruct
the Securities Depository to execute the transactions described in (d)(ii)
above, and the Securities Depository shall execute such transactions; and
(iii) each Buyer's Broker-Dealer or its Agent Member instruct the
Securities Depository to execute the transactions described in (d)(iii)
above, and the Securities Depository shall execute such transactions.
<PAGE>
EXHIBIT E
---------
FORD HOLDINGS, INC.
NOTICE OF LONG-TERM DIVIDEND PERIOD
NOTICE IS HEREBY GIVEN that Merrill Lynch & Co., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Goldman, Sachs &
Co. and Lehman Brothers Inc., the Term Selection Agents for the
Flexible Rate Auction Preferred Stock--Series [O] [P] of Ford
Holdings, Inc. (the "Company") have, after considering the
factors set forth in paragraph 3(b)(viii) of the Certificate of
Designations, determined that the Long-Term Dividend Period
established hereby provides the Company with the most favorable
financing alternative and have selected a Long-Term Dividend
Period of days which commences on and
ends on as the term of the next Dividend
Period for its Flexible Rate Auction Preferred Stock--Series
[O] [P] (the "Series"). [Paragraph 5(e)(iii) of the
Certificate of Designations provides that without the
affirmative vote of the holders of a majority of the
Outstanding shares of Auction Preferred, Voting Preferred and
Parity Preferred, voting together as a single class, in person
or by proxy at a special meeting for the purpose, or the
unanimous written consent of the holders of the Outstanding
shares of Auction Preferred, Voting Preferred and Parity
Preferred acting without such a meeting (subject to the
provisions of any applicable law), the Company may not sell,
lease or convey all or substantially all of the assets of the
Company or consolidate or merge with or into any other
corporation unless, in the case of a consolidation or merger,
each holder of shares of Auction Preferred, Voting Preferred
and Parity Preferred shall receive, upon such consolidation or
merger, an amount in cash equal to the liquidation preference,
Merger Premium, if any is established by the Term Selection
Agents, and accumulated and unpaid dividends through the date
of payment for such shares of Auction Preferred, Voting
Preferred and Parity Preferred in exchange for such shares of
Auction Preferred, Voting Preferred and Parity Preferred. The
Term Selection Agents have determined that a Merger Premium of
per share has been established for the shares of the
Series.]
The next Auction Date for the Series is scheduled to occur
on , 19 .
<PAGE>
E-2
Existing Holders are hereby advised that the Term
Selection Agents may revoke the notice given hereby by
delivering a Notice of Revocation to the Auction Agent by 12:00
noon, New York City time, on the second business day prior to
the next Auction Date with respect to the Series.
If the Term Selection Agents revoke this notice or if
Sufficient Clearing Bids with respect to the Series do not
exist on the Auction Date or a Failure to Deposit occurs on or
prior to such Auction Date, the next Dividend Period for the
Series will be a Short-Term Dividend Period.
TERM SELECTION AGENTS
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By
--------------------------
Title
--------------------------
Goldman, Sachs & Co.
Lehman Brothers Inc.
By
---------------------------
Title
------------------------
Date: , 19
-----------------
<PAGE>
EXHIBIT F
---------
FORD HOLDINGS, INC.
NOTICE OF REVOCATION
NOTICE IS HEREBY GIVEN that Merrill Lynch & Co., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Goldman, Sachs &
Co. and Lehman Brothers Inc., the Term Selection Agents for the
Flexible Rate Auction Preferred Stock--Series [O] [P] (the
"Series") of Ford Holdings, Inc. (the "Company") are hereby
revoking the Notice of Long-Term Dividend Period dated
, 19 with respect to the Series and the next
Dividend Period for the Series shall be a Short-Term Dividend
Period of 49 days.
The Term Selection Agents have determined that because of
subsequent changes the factors referred to in paragraph
3(b)(viii) of the Certificate of Designations relating to the
Series, such Long-Term Dividend Period would not result in the
most favorable financing alternative for the Company.
TERM SELECTION AGENTS
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
By
------------------------------
Title
---------------------------
Goldman, Sachs & Co.
Lehman Brothers Inc.
By
-------------------------------
Title
----------------------------
Date: , 19
<PAGE>
EXHIBIT G
---------
FORD HOLDINGS, INC.
NOTICE OF REMOVAL
NOTICE IS HEREBY GIVEN that the Term Selection Agents for
the Flexible Rate Auction Preferred Stock--Series [O] [P] (the
"Series") of Ford Holdings, Inc. have been removed and the
Notice of Long-Term Dividend Period dated , 19
with respect to the Series is deemed to be revoked.
FORD HOLDINGS, INC.
By
-------------------
Title
-----------------
Date: , 19
<PAGE>
EXHIBIT H
---------
FORD HOLDINGS, INC.
NOTICE OF CURE OF FAILURE TO DEPOSIT
NOTICE IS HEREBY GIVEN that Ford Holdings, Inc. (the
"Company") has cured the Failure to Deposit with respect to the
Company's Flexible Rate Auction Preferred Stock--Series [O] [P]
(the "Series") that occurred on , 19 by
depositing with the undersigned an amount equal to
[if the Failure to Deposit occurred prior to the beginning of a
Dividend Period and was cured by 12:00 noon, New York City
time, on the third Business Day next succeeding such Failure to
Deposit, insert--all accumulated and unpaid dividends on the
shares of the Series, including the full amount of any
dividends to be paid with respect to the Dividend Period with
respect to which such Failure to Deposit occurred, plus an
amount computed by multiplying (i) 200% of the 60-day 'AA'
Composite Commercial Paper Rate by (ii) a fraction, the
numerator of which is the number of days for which such Failure
to Deposit remained uncured (including the day the Failure to
Deposit occurred and excluding the day the Failure to Deposit
was cured) and the denominator of which is 360, and applying
the rate obtained against the aggregate liquidation preference
of the shares of the Series outstanding.]
[if the Failure to Deposit occurred prior to a Dividend Period
and was not cured by 12:00 noon, New York City time, on the
third Business Day next succeeding such Failure to Deposit,
insert--all accumulated and unpaid dividends on the shares of
the Series, including the full amount of any dividends to be
paid with respect to the Dividend Period with respect to which
such Failure to Deposit occurred and including the full amount
of any dividends to be paid with respect to each Dividend
Period since the Failure to Deposit occurred, calculated, in
the case of accumulated and unpaid dividends for Dividend
Periods commencing after the date such Failure to Deposit
occurred, using an Applicable Rate equal to 200% of LIBOR.]
[if the Failure to Deposit occurred during a Long-Term Dividend
Period, insert--all accumulated and unpaid dividends on the
shares of the Series, including (i) the full amount of any
dividends with respect to the Dividend Quarter with respect to
which such Failure to Deposit occurred, [and] (ii) the full
amount of any dividends to be paid with respect to each
Dividend Quarter since the Failure to Deposit occurred
calculated at the Applicable Rate for the Long Term Dividend
Period, plus an amount, as additional accumulated and unpaid
dividends, calculated by multiplying (x) 200% of LIBOR on the
date on which such Failure to Deposit occurred by (y) a
fraction, the numerator of which shall be the number of days
(up to a maximum of the total number of days remaining in the
Long-Term Dividend Period) for which such Failure to Deposit
<PAGE>
H-2
was not cured (including the day the Failure to Deposit
occurred and excluding, if applicable, the day the Failure to
Deposit was cured) and the denominator of which shall be 360,
and applying the rate obtained against accumulated dividends
not paid when due [if such Failure to Deposit was not cured
prior to the next succeeding Auction Date for the Series,
insert--and (iii) the full amount of any dividends with respect
to Dividend Periods commencing after the next succeeding
Auction Date for the shares of the Series, calculated using an
Applicable Rate equal to 200% of LIBOR].]
THE BANK OF NEW YORK,
as Auction Agent
By
-----------------
Title
--------------
Date: , 19
<PAGE>
EXHIBIT I
FORD HOLDINGS, INC.
NOTICE OF SPECIAL MEETING OF HOLDERS
OF AUCTION PREFERRED STOCK
To Be Held On
NOTICE IS HEREBY given that a Special Meeting of Holders
of Flexible Rate Auction Preferred Stock--Series O and P
(collectively the "Auction Preferred") of FORD HOLDINGS, INC.
(the "Company") will be held at [address of the principal
offices of the Company]1 on 2 at 10:00 a.m.,
time,3 for the purpose of electing
Directors of the Board of Directors of the Company pursuant to
paragraph 5(c) of the Certificate of Designations establishing
and creating the Auction Preferred to serve until the earlier
of (i) the next annual meeting of stockholders or (ii) such
time as all accumulated and unpaid dividends on the then
outstanding shares of each series of the Auction Preferred
shall have been paid or declared and set aside for payment.
If, prior to the date of the Special Meeting, the Company
satisfies all the requirements described in clause (ii) above,
the Special Meeting will be cancelled.
The record date for the Special Meeting is
.4 Only holders of record of the Auction
Preferred at the close of business on such date are entitled to
this notice and to vote at the Special Meeting or any
adjournment thereof.
FORD HOLDINGS, INC.
Date: ,5
- ----------------------------
1. The Company may select, as its option, any other location in
continental United States.
2. Insert a date permitted by paragraph 5(c) of the Certificate of
Designations.
3. Insert appropriate time zone.
4. Insert the date that the right referred to in Paragraph 5(c)(i) of
Certificate of Desigations accrued.
5. Insert date notice is given
EXHIBIT 4.5
- -----------------------------------------------------------------
TERM SELECTION AGENT AGREEMENT
among
FORD HOLDINGS, INC.
and
MERRILL LYNCH & CO.,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
GOLDMAN, SACHS & CO.
and
LEHMAN BROTHERS INC.
Dated as of June 23, 1995
Relating to
FLEXIBLE RATE AUCTION PREFERRED
STOCK --SERIES O and SERIES P
of
FORD HOLDINGS, INC.
- -----------------------------------------------------------------
<PAGE>
TERM SELECTION AGENT AGREEMENT dated as of June 23, 1995
among FORD HOLDINGS, INC., a Delaware corporation (the
"Company"), MERRILL LYNCH & CO., MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED, a Delaware corporation (Merrill Lynch),
GOLDMAN, SACHS & CO., a New York limited partnership ("Goldman
Sachs") and LEHMAN BROTHERS INC., a Delaware corporation ("Lehman
Brothers", each of Merrill Lynch, Goldman Sachs and Lehman
Brothers a "Term Selection Agent" and together, the "Term
Selection Agents").
The Company proposes to issue 500 shares designated
"Flexible Rate Auction Preferred Stock--Series O" ("Series O")
and 500 shares designated "Flexible Rate Auction Preferred
Stock--Series P" ("Series P" and, collectively, the "Auction
Preferred"), pursuant to its Certificate of Designations relating
to the shares of Auction Preferred. The Company desires that the
Term Selection Agents perform certain duties in connection with
each Series upon the terms and conditions of this Agreement, and
hereby appoints Merrill Lynch, Goldman Sachs and Lehman Brothers
as the Term Selection Agents to act in the capacities set forth
in this Agreement.
NOW, THEREFORE, the Company, Merrill Lynch, Goldman Sachs
and Lehman Brothers agree as follows:
SECTION 1. Definitions and Rules of Construction.
SECTION 1.1. Terms Defined by Reference to Certificate of
Designations. Capitalized terms not defined herein shall have
the meanings specified in the Certificate of Designations.
SECTION 1.2. Terms Defined Herein. As used herein, the
following terms shall have the following meanings, unless the
context otherwise requires:
(a) "Auction Agreement" means the Auction Agent
Agreement dated as of June 23, 1995, between the Company and
the Auction Agent.
(b) "Authorized Officer" means every partner, officer,
director or employee of each Term Selection Agent
designated as an "Authorized Officer" for purposes hereof in
a notice to the Company.
(c) "Company Officer" means the President, each Vice
President (whether or not designated by a number or word or
words added before or after the title "Vice President"), the
Secretary, the Treasurer, each Assistant Secretary and each
Assistant Treasurer of the Company and every other officer
or employee of the Company designated as a "Company Officer"
for purposes hereof in a notice to the Term Selection Agent.
<PAGE>
2
(d) Certificate of Designations" means the Certificate
of Designations of the Company relating to Series O and
Series P, as filed by the Company on June 22, 1995, in the
office of the Secretary of State of the State of Delaware, a
copy of which is attached to the Auction Agreement as
Exhibit B.
SECTION 1.3. Rules of Construction. Unless the context or
use indicates another or different meaning or intent, the
following rules shall apply to the construction of this
Agreement:
(a) Words importing the singular number shall include
the plural number and vice versa.
(b) The captions and headings herein are solely for
convenience of reference and shall not constitute a part of
this Agreement nor shall they affect the meaning,
construction or effect of any provision of this Agreement.
(c) The words "hereof", "herein", "hereto" and other
words of similar import refer to this Agreement as a whole.
(d) All references herein to a particular time of day
shall be to New York City time.
SECTION 2. Term Selection. (a) The Company hereby
appoints Merrill Lynch, Goldman Sachs and Lehman Brothers, and
Merrill Lynch, Goldman Sachs and Lehman Brothers each hereby
accepts the appointment, as Term Selection Agents for the purpose
of establishing the length of Long-Term Dividend Periods with
respect to the Series O and Series P, in each case in accordance
with the provisions hereof and the Certificate of Designations.
Merrill Lynch, Goldman Sachs and Lehman Brothers hereby agree
that they jointly will make any determination of a Long-Term
Dividend Period with respect to shares of a Series in accordance
with the Certificate of Designations and this Agreement. In the
event that Merrill Lynch, Goldman Sachs and Lehman Brothers are
unable to agree, such designation or determination will be as
jointly agreed by any two of Merrill Lynch, Goldman Sachs and
Lehman Brothers and, in the event that any two of Merrill Lynch,
Goldman Sachs and Lehman Brothers cannot so agree, such
designation or determination will be made solely by Merrill
Lynch.
(b)(i) The Term Selection Agents agree that they may
establish a Long-Term Dividend Period (including any Merger
Premium) for the shares of a Series of Auction Preferred, if they
determine that such Long-Term Dividend Period (including any
Merger Premium), in their sole opinion, provides the Company with
the most favorable financing alternative based upon the
following: (A) short-term and long-term market rates and indices
of such short-term and long-term rates, (B) the amounts,
maturities and interest or dividend rates on the then outstanding
<PAGE>
3
securities of the Company or its subsidiaries, (C) market supply
and demand for short-term and long-term securities, (D) yield
curves for short-term and long-term securities comparable to the
shares of Auction Preferred, (E) industry and financial
conditions which may affect the shares of Auction Preferred
including each Term Selection Agent's expectations with respect
thereto, (F) then current tax laws and administrative
interpretations with respect thereto, (G) the number of shares of
Auction Preferred and other auction rate preferred stock of the
Company Outstanding on the next Auction Date and (H) the number
of potential purchasers.
(ii) Each Long-Term Dividend Period for a series of
Auction Preferred designated by the Term Selection Agents shall
end on such day as specified by the Term Selection Agents;
provided that each Long-Term Dividend Period shall be longer than
a Short-Term Dividend Period (currently 49 days) and shall
consist of a whole number of weeks.
(c) The Term Selection Agents shall specify that the next
succeeding Dividend Period for such Series of Auction Preferred
as a Long-Term Dividend Period by giving telephonic and written
notice (a "Notice of Long-Term Dividend Period") to the Company,
the Auction Agent, the Paying Agent and the Securities
Depository, on or prior to the fifth day but not more than
20 days prior to an Auction Date for such Series of Auction
Preferred; provided that the Term Selection Agent may not give a
Notice of Long-Term Dividend Period for such Series (and any such
notice shall be null and void) unless Sufficient Clearing Bids
were made in the last occurring Auction for such Series and full
cumulative dividends for all Series and all series of Flexible
Rate Auction Preferred Stock payable prior to such date have been
paid in full. The Notice of Long-Term Dividend Period shall
state (i) that the next succeeding Dividend Period for such
Series shall be a Long-Term Dividend Period, (ii) the term
thereof and (iii) whether such shares shall be entitled to a
Merger Premium in the event of a merger or consolidation and
shall be substantially in the form of Exhibit E to the Auction
Agreement.
(d) Any Notice of Long-Term Dividend Period may be revoked
by the Term Selection Agents on or prior to the second Business
Day prior to the related Auction by telephonic and written
notice, substantially in the form of Exhibit F to the Auction
Agreement, to the Company, the Auction Agent, the Paying Agent
and the Securities Depository.
(e) The Company agrees to provide the Term Selection Agents
with all information they may reasonably request in connection
with the performance of their duties hereunder.
SECTION 3. Representations and Warranties of the Company.
The Company represents and warrants to the Term Selection Agents
that:
<PAGE>
4
(a) This Agreement has been duly and validly
authorized, executed and delivered by the Company and,
assuming due authorization, execution and delivery by the
Term Selection Agents, constitutes the valid and legally
binding obligation of the Company, enforceable in
accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of
general applicability relating to or affecting creditors'
rights and to general equity principles; and
(b) The execution and delivery of this Agreement and
the performance by the Company of its obligations hereunder
do not and will not conflict with, violate, or result in a
breach of, the terms, conditions or provisions of, or
constitute a default under, the Certificate of
Incorporation or the By-laws of the Company, any law or
regulation, any order or decree of any court or public
authority having jurisdiction, or any mortgage, indenture,
contract, agreement or undertaking to which the Company is
a party or by which it is bound.
SECTION 4. The Term Selection Agents.
SECTION 4.1. Duties and Responsibilities. (a) The Term
Selection Agents are acting solely as agents of the Company
hereunder and owe no fiduciary duty to any other person by reason
of this Agreement.
(b) The Term Selection Agents 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 Term Selection Agents.
(c) The Term Selection Agents shall have no duty or
responsibility to verify or determine the accuracy of any
document delivered to them in accordance with the terms
hereunder. The Term Selection Agents shall have no duty or
responsibility to enforce the obligations of the Company to
provide the Term Selection Agents with any notice or document.
(d) In the absence of bad faith or gross negligence on its
part, no Term Selection Agent shall be liable for any action
taken, suffered, or omitted by it in the performance of its
duties under this Agreement, nor shall any Term Selection Agent
be liable for any error of judgment made in good faith unless
such Term Selection Agent shall have been grossly negligent in
ascertaining the pertinent facts.
SECTION 4.2. Rights of the Term Selection Agents. (a)
Each Term Selection Agent may rely and shall be protected in
acting or refraining from acting upon any communication
authorized hereby and upon any written instruction, notice,
request, direction, consent, report, certificate, share
certificate or other instrument, paper or document believed by it
to be genuine. The Term Selection Agents shall not be liable for
<PAGE>
5
acting upon any telephone communication authorized hereby which
the Term Selection Agents believe in good faith to have been
given by the Company. The Term Selection Agents may record by
tape or otherwise telephonic communications with the Company.
(b) Each Term Selection Agent may consult with counsel, 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 reliance
thereon.
SECTION 4.3. Compensation, Expenses and Indemnification.
(a) The Company shall reimburse each Term Selection Agent upon
its request for all disbursements and advances incurred or made
by such Term Selection Agent in accordance with any provision
hereof (including the compensation, expenses and disbursements of
the agents and counsel of such Term Selection Agent).
(b) The Company shall indemnify each Term Selection Agent
against, and hold it harmless from, any loss, liability or
expense, incurred without gross negligence or bad faith on its
part, arising out of or in connection with its agency, duties or
functions hereunder including the costs and expenses of defending
itself against any claim or liability in connection with its
exercise or performance of any of its duties hereunder for which
it is entitled to indemnification hereunder.
(c) Promptly after receipt by a Term Selection Agent under
subsection (b) above of written notice of the commencement of any
action, such Term Selection Agent shall, if a claim in respect
thereof is to be made against the Company under such subsection,
notify the Company in writing of the commencement thereof, and in
the event that such Term Selection Agent shall not so notify the
Company within 30 days following receipt of any such notice by
such Term Selection Agent, the Company shall have no further
liability under such subsection to such Term Selection Agent
unless the Company shall have received other notice addressed and
delivered to it at its office specified in Section 5.2 hereof of
the commencement of such action; but the omission so to notify
the Company shall not relieve it from any liability which it may
have to any Term Selection Agent otherwise than under such
subsection. In case any such action shall be brought against any
Term Selection Agent, and it shall notify the Company of the
commencement thereof, the Company shall be entitled to
participate therein, and, to the extent that it shall wish, to
assume the defense thereof, with counsel satisfactory to such
Term Selection Agent in its reasonable judgment, and after notice
from the Company to such Term Selection Agent of its election so
to assume the defense thereof, the Company shall not be liable to
such Term Selection Agent under such subsection for any legal or
other expenses subsequently incurred by such Term Selection Agent
in connection with the defense thereof other than reasonable
costs of investigation.
(d) If the indemnification provided for in subsection (b)
above is unavailable to a Term Selection Agent in respect of any
losses, claims, damages or liabilities (or actions in respect
thereof) referred to therein, then the Company shall contribute
to the amount paid or payable by such Term Selection Agent as a
<PAGE>
6
result of such losses, claims, damages or liabilities (or actions
in respect thereof) in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one
hand and such Term Selection Agent on the other from the offering
of the shares of Auction Preferred in accordance with the
Underwriting Agreement, dated June 20, 1995 (the "Underwriting
Agreement"), among the Company and Merrill Lynch, Goldman Sachs
and Lehman Brothers, as Underwriters (the "Underwriters") and the
Pricing Agreement, dated June 20, 1995 (the "Pricing Agreement"),
among the Company and the Underwriters. If, however, the
allocation provided by the immediately preceding sentence is not
permitted by applicable law, then the Company shall contribute to
such amount paid or payable by such Term Selection Agent in such
proportion as is appropriate to reflect not only such relative
benefits but also the relative fault of the Company on the one
hand and such Term Selection Agent on the other, as well as any
other relevant equitable considerations. The relative benefits
received by the Company on the one hand and such Term Selection
Agent on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering of Auction Preferred
in accordance with the Underwriting Agreement and the Pricing
Agreement (before deducting expenses) received by the Company
bear to the total commissions received by such Term Selection
Agent, acting in its capacity as an Underwriter, pursuant to the
Underwriting Agreement and the Pricing Agreement. The Company
and the Term Selection Agents agree that it would not be just and
equitable if contribution pursuant to this subsection (d) were
determined by pro rata allocation or by any other method of
allocation which does not take account of the equitable
considerations referred to above in this subsection (d). The
amount paid or payable by a Term Selection Agent as a result of
the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (d) shall be deemed
to include any legal or other expenses reasonably incurred by
such Term Selection Agent in connection with investigating or
defending any such action or claim.
SECTION 5. Miscellaneous.
SECTION 5.1. Term of Agreement. (a) Unless otherwise
terminated as provided in this Section 5.1, this Agreement shall
remain in effect for so long as shares of Auction Preferred are
outstanding. The Company may terminate this Agreement with
respect to any or all Series upon 5 days' written notice to the
Term Selection Agents. Any Term Selection Agent may resign and
terminate this Agreement with respect to a Series upon 20 days'
written notice to the Company, with a copy to the remaining Term
Selection Agents, provided that no such resignation may become
effective within 25 days prior to an Auction Date for such
Series. In the event of the resignation of one Term Selection
Agent, the Agreement shall remain in effect with respect to the
remaining Term Selection Agents.
(b) Except as otherwise provided in this subsection (b),
the respective rights and duties of the Company and the Term
Selection Agents under this Agreement shall cease upon
termination of this Agreement. The Company's representations,
warranties, covenants and obligations to the Term Selection
Agents under Sections 3 and 4.3 hereof shall survive the
termination hereof.
<PAGE>
7
SECTION 5.2. Communications. Except for communications
authorized to be made by telephone pursuant to this Agreement,
all notices, requests and other communications to any party
hereunder shall be in writing (including telecopy or similar
electronic facsimile followed by oral confirmation of receipt)
and shall be given to such person addressed to it, at its address
or telecopier number set forth below:
If to the Company, addressed:
Ford Holdings, Inc.
The American Road
Dearborn, Michigan 48121
Attention: Manager--Financing Department
Telecopier No.: (313) 845-4077
Telephone No.: (313) 322-2110
If to the Term Selection Agents, addressed:
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
North Tower
World Financial Center
New York, New York 10281
Attention: Carter Kegel
c/o Preferred Desk
Telecopier No.: (212) 449-2761
Telephone No.: (212) 449-4940
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Attention: Kinsey Marable
c/o Preferred Desk
Telecopier No.: (212) 509-8885
Telephone No.: (212) 902-6080
and
Lehman Brothers Inc.
3 World Financial Center
New York, New York 10285
<PAGE>
8
Attention: Thomas Corcoran
c/o Auction Securities Desk
Telecopier No.: (212) 528-6385
Telephone No.: (212) 526-8390
or to such other address or telecopier number as such party may
hereafter specify for such purpose by notice to the other party.
Each such notice, request or communication shall be effective
when delivered at the address specified herein. Communications
shall be given on behalf of the Company by a Company Officer and
on behalf of each of Merrill Lynch, Goldman Sachs and Lehman
Brothers by an Authorized Officer.
SECTION 5.3. Entire Agreement. This Agreement contains the
entire agreement between the parties relating to the subject
matter hereof and there are no other representations,
endorsements, promises, agreements or understandings, oral,
written or inferred, between the parties relating to the subject
matter hereof except for agreements relating to the compensation
of the Term Selection Agents.
SECTION 5.4. Benefits. Nothing herein, express or implied,
shall give to any person, other than the Company, the Term
Selection Agents and their respective successors and assigns, any
benefit of any legal or equitable right, remedy or claim
hereunder.
SECTION 5.5. Amendment; Waiver. (a) This Agreement shall
not be deemed or construed to be modified, amended, rescinded,
canceled or waived, in whole or in part, except by a written
instrument signed by the parties hereto. The Company shall
notify the Term Selection Agents of any change in the Certificate
of Designations and Certificate of Incorporation not less than
ten Business Days prior to the effective date of any such change.
(b) Failure of any party hereto to exercise any right or
remedy hereunder in the event of a breach hereof by the other
party shall not constitute a waiver of any such right or remedy
with respect to any subsequent breach.
SECTION 5.6. Successors and Assigns. This Agreement shall
be binding upon, inure to the benefit of, and be enforceable by,
the respective successors and assigns of each of the Company and
the Term Selection Agents, provided that each Term Selection
Agent shall give the Company 10 days' written notice of any
assignment of its rights and obligations hereunder.
SECTION 5.7. Severability. If any clause, provision or
section hereof shall be ruled invalid or unenforceable by any
court of competent jurisdiction, the invalidity or
unenforceability of such clause, provision or section shall not
affect any of the remaining clauses, provisions or sections
hereof.
<PAGE>
9
SECTION 5.8. Execution in Counterparts. This Agreement may
be executed in several counterparts, each of which shall be an
original and all of which shall constitute but one and the same
instrument.
SECTION 5.9. Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the
State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their proper and
duly authorized officers as of the date first above written.
FORD HOLDINGS, INC.
By /s/ Eric A. Law
---------------------
Name: Eric A. Law
Title: Vice President -
Controller
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner &
Smith Incorporated
By /s/ Matthew Hogan
--------------------
Name: Matthew Hogan
Title: Director
/s/ Goldman, Sachs & Co.
-------------------------
(Goldman, Sachs & Co.)
LEHMAN BROTHERS INC.
By /s/ Robert H. Swindell
--------------------------
Name: Robert H. Swindell
Title: Managing Director
