EXECUTION COPY
HSBC AMERICAS, INC.
Medium-Term Senior Notes
Due More than Nine Months from Date of Issue
DISTRIBUTION AGREEMENT
August 21, 1998
To the Agents listed on Exhibit A
hereto and to each additional person
that shall become an Agent as
provided in Section 1(f) of this Agreement.
Ladies and Gentlemen:
HSBC Americas, Inc., a Delaware corporation (the
"Company"), has authorized and proposes to issue and sell from
time to time in the manner contemplated by this Agreement up to
$400,000,000 in aggregate initial offering price of its
Medium-Term Senior Notes (the "Notes"). The Notes are to be
issued pursuant to an Indenture dated as of October 24, 1996
between the Company and Bankers Trust Company (the "Trustee"), as
trustee (such Indenture, as amended or supplemented from time to
time, the "Indenture").
The Company has filed with the Securities and Exchange
Commission (the "SEC") a registration statement on Form S-3 (No.
333-53647) for the registration of debt securities (both senior
and subordinated) and shares of preferred stock under the
Securities Act of 1933, as amended (the "1933 Act"), and the
offering thereof from time to time in accordance with Rule 415 of
the rules and regulations of the SEC under the 1933 Act (the
"1933 Act Regulations"). Such registration statement has been
declared effective by the SEC, and the Trustee has been qualified
under the Trust Indenture Act of 1939, as amended (the "1939
Act"). Such registration statement (and any further registration
statements which may be filed by the Company for the purpose of
registering additional Notes and in connection with which this
Agreement is included or incorporated by reference as an exhibit)
and the prospectus relating to the offer and sale of the
Company's debt securities constituting a part thereof, as
supplemented by a prospectus supplement dated on or about the
date hereof relating to the Notes, including all documents
incorporated therein by reference, each as from time to time
amended or supplemented, as the case may be, through the date of
the relevant reference in this Agreement to the Registration
Statement or Prospectus, by the filing of documents pursuant to
the Securities Exchange Act of 1934, as amended (the "1934 Act")
or the 1933 Act, or otherwise, are referred to herein as the
"Registration Statement" and the "Prospectus," respectively,
except that if any revised prospectus shall be provided to the
Agents by the Company for use in connection with the offering of
the Notes which is not required to be filed by the Company
pursuant to Rule
424(b) or Rule 434 of the 1933 Act Regulations, the term
"Prospectus" shall refer to such revised prospectus from and
after the time it is first provided to the Agent for such use.
The Company confirms its agreement with each of you
(individually, an "Agent" and collectively, the "Agents") with
respect to the issue and sale from time to time by the Company of
the Notes as follows:
Appointment of Agents.
Appointment. Subject to the terms and conditions
stated herein, the Company hereby appoints each of you as Agent
in connection with the offer and sale of the Notes.
Notwithstanding the foregoing or any other provision herein to
the contrary, the Company reserves the right to sell Notes, at
any time, on its own behalf to any unsolicited purchaser, whether
directly to such purchaser or through an agent for such
purchaser. Upon the sale of any Notes directly by the Company to
an unsolicited purchaser, no Agent named herein shall be entitled
to any commission pursuant to this Agreement.
Solicitations as Agent. Subject to the terms and
conditions set forth herein, each Agent agrees, severally and not
jointly, as agent of the Company, to use its reasonable best
efforts when requested by the Company to solicit offers to
purchase the Notes upon the terms and conditions set forth in the
Prospectus and the Administrative Procedures with respect to the
sale of Notes as may be agreed upon from time to time between the
Agents and the Company (the "Procedures"). Initial Administrative
Procedures dated August 21, 1998 shall remain in effect until
changed by the Agents and the Company. The Agents and the Company
agree to perform the respective duties and obligations
specifically provided to be performed by them in the Procedures.
Notwithstanding any provision herein to the contrary, the Company
reserves the right, in its sole discretion, to suspend
solicitation of purchases of the Notes through the Agents, as
agent, commencing at any time for any period of time or
permanently. Upon receipt of instructions from the Company, the
Agents will forthwith suspend solicitation of purchases of the
Notes until such time as the Company has advised the Agents that
such solicitation may be resumed.
Each Agent will communicate to the Company, orally,
each offer to purchase Notes solicited by such Agent on an agency
basis, other than those offers rejected by the Agent. The Agent
shall have the right, in its discretion reasonably exercised, to
reject any proposed purchase of Notes by persons solicited by the
Agent, as a whole or in part, and any such rejection shall not be
deemed a breach of the Agent's agreement contained herein. The
Company may accept or reject any proposed purchase of the Notes,
in whole or in part, and any such rejection shall not be deemed a
breach of the Company's agreement herein.
All Notes sold through an Agent as agent will be sold
at 100% of their principal amount unless otherwise agreed to by
the Company and such Agent. The purchase price, interest
rate (if applicable), maturity date and other terms of the Notes
(as applicable) specified in Exhibit B hereto shall be agreed
upon by the Company and such Agent and set forth in a pricing
supplement to the Prospectus (a "Pricing Supplement") to be
prepared following each acceptance by the Company of an offer for
the purchase of Notes.
Such Agent shall make reasonable efforts to assist the
Company in obtaining performance by each purchaser whose offer to
purchase Notes has been solicited by such Agent and accepted by
the Company. The Agent shall not have any liability to the
Company in the event any such agency purchase is not consummated
for any reason other than the gross negligence of the Agent. If
the Company shall default on its obligation to deliver Notes to a
purchaser whose offer it has accepted, the Company shall (i) hold
the Agent for such purchase harmless against any loss, claim or
damage arising from or as a result of such default by the Company
and (ii) notwithstanding such default, pay to such Agent any
commission to which it would be entitled in connection with such
sale.
Commissions. For those offers to purchase Notes
accepted by the Company, the Agent shall be paid a commission.
Unless otherwise agreed between the Company and the Agent and
disclosed in a Pricing Supplement, such commission shall be an
amount equal to the applicable percentage of the principal amount
of each Note sold by the Company as a result of a solicitation
made by such Agent as set forth in Exhibit C hereto.
Purchases as Principal. The Agents shall not have any
obligation to purchase Notes from the Company as principal, but
an Agent and the Company may expressly agree from time to time
that such Agent shall purchase Notes as principal. In the event
that an Agent and the Company shall expressly so agree, Notes
shall be purchased by such Agent as principal. Unless otherwise
agreed between the Company and the Agent and disclosed in a
Pricing Supplement, each Note sold to an Agent as principal shall
be purchased by such Agent at a price equal to 100% of the
principal amount thereof less a discount equivalent to the
applicable commissions set forth in Exhibit C hereto and may be
resold by such Agent at prevailing market prices at the time or
times of resale as determined by such Agent. Such purchases as
principal shall otherwise be made in accordance with terms agreed
upon by the Agent and the Company, by written agreement
substantially in the form of Exhibit D hereto (a "Terms
Agreement") relating to such purchase, but may take the form of
an exchange of any standard form of written telecommunication
between the Agent and the Company. The Agent's commitment to
purchase Notes as principal shall be deemed to have been made on
the basis of the representations, warranties and covenants of the
Company herein contained and shall be subject to the terms and
conditions set forth herein, including Section 10(b) hereof.
Sub-Agents. An Agent may engage the services of any
other broker or dealer in connection with the resale of any Notes
purchased as principal but no Agent may appoint sub- agents. In
connection with sales by an Agent of Notes purchased by such
Agent as principal to
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other brokers or dealers, such Agent may allow any portion of the
discount received in connection with such purchases from the
Company to such brokers and dealers.
Appointment of Additional Agents. Notwithstanding any
provision herein to the contrary, the Company reserves the right
to appoint additional agents for the offer and sale of Notes,
which agency may be on an on-going basis or on a one-time basis.
Any such additional agent shall become a party to this Agreement
and shall thereafter be subject to the provisions hereof and
entitled to the benefits hereunder upon the execution of a
counterpart hereof or other form of acknowledgment of its
appointment hereunder, including the form of letter attached
hereto as Exhibit E, and delivery to the Company of addresses for
notice hereunder and under the Procedures. After the time an
Agent is appointed, the Company shall deliver to the Agent, at
such Agent's request, copies of the documents delivered to other
Agents under Sections 4(a), 4(b) and 4(c), and the initial
comfort letter delivered under Section 6(d), and, if such
appointment is on an on-going basis, Sections 6(b), 6(c) and 6(d)
hereof.
Reliance. The Company and the Agents agree that any
Notes the placement of which an Agent arranges shall be placed by
such Agent in reliance on the representations, warranties,
covenants and agreements of the Company contained herein and on
the terms and conditions and in the manner provided herein or
provided in the Procedures.
Sale of Notes. The Company shall not sell or approve
the solicitation of purchases of Notes in excess of the amount
which shall be authorized by the Company from time to time or in
excess of the principal amount of Notes registered pursuant to
the Registration Statement. The Agents will have no
responsibility for maintaining records with respect to the
aggregate principal amount of Notes sold or otherwise monitoring
the availability of Notes for sale under the Registration
Statement.
Representations and Warranties.
The Company represents and warrants to the Agents as
of the date hereof, as of the date of each acceptance by the
Company of an offer for the purchase of Notes (whether through an
Agent as agent or to an Agent as principal), as of the date of
each delivery of Notes (whether through an Agent as agent or to
an Agent as principal) (the date of each such delivery to an
Agent as principal being hereafter referred to as a "Settlement
Date"), and as of any time that the Registration Statement or the
Prospectus is amended or supplemented or there is filed with the
SEC any document incorporated by reference into the Prospectus
(other than any Current Report on Form 8-K relating exclusively
to the issuance of debt securities under the Registration
Statement) (each of the times referenced above being referred to
herein as a "Representation Date") as follows:
The Company meets the requirements for use of
Form S-3 under the 1933 Act and has filed with the SEC the
Registration Statement, which has become effective.
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Such Registration Statement meets the requirements of Rule
415(a)(1) under the 1933 Act and complies in all other
material respects with said Rule.
As of the date hereof, when the Prospectus as
supplemented with respect to the Notes is first filed
pursuant to Rule 424 under the 1933 Act, when any amendment
to the Registration Statement becomes effective (including
the filing of any document incorporated by reference in the
Registration Statement) and as of any other applicable
Representation Date, (a) the Registration Statement, the
Prospectus, and the Indenture comply and will comply in all
material respects with the applicable requirements of the
1933 Act, the 1939 Act and the 1934 Act and the respective
rules and regulations thereunder, (b) the Registration
Statement does not and will not contain any untrue
statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to
make the statements therein not misleading, and (c) the
Prospectus does not and will not contain any untrue
statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances
under which they were made, not misleading; provided,
however, that the Company makes no representations or
warranties as to (x) that part of the Registration
Statement which shall constitute the Statement of
Eligibility and Qualification of the Trustee (Form T-1)
under the 1939 Act of the Trustee or (y) the information
contained in or omitted from the Registration Statement or
the Prospectus in reliance upon and in conformity with
information furnished in writing to the Company by or on
behalf of any Agent specifically for inclusion in the
Registration Statement or the Prospectus.
Additional Certifications. Any certificate signed by
any director or officer of the Company and delivered to an Agent
or to counsel for such Agent in connection with an offering of
Notes or the sale of Notes to an Agent as principal shall be
deemed a representation and warranty by the Company to such Agent
as to the matters covered thereby on the date of such certificate
and at each Representation Date subsequent thereto (and it is
understood that such representation and warranty shall relate
only to the time as of which such certificate is given and
insofar as it relates to the Registration Statement and
Prospectus shall relate to the Registration Statement and
Prospectus as amended and supplemented to the time of such
certificate).
Covenants of the Company.
The Company covenants with the Agents as follows:
Notice of Certain Events. The Company will notify the
Agents immediately (i) of the effectiveness of any amendment to
the Registration Statement, (ii) of the transmittal to the SEC
for filing of any supplement to the Prospectus or any document to
be filed pursuant to the 1934 Act which will be incorporated by
reference in the Prospectus, (iii) of the receipt of any comments
from the SEC with respect to the Registration Statement or the
Prospectus (other than
with respect to a document filed with the SEC pursuant to the
1934 Act which will be incorporated by reference in the
Registration Statement and the Prospectus), (iv) of any request
by the SEC for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for additional
information relating thereto (other than such a request with
respect to a document filed with the SEC pursuant to the 1934 Act
which will be incorporated by reference in the Registration
Statement and the Prospectus), (v) of the issuance by the SEC of
any stop order suspending the effectiveness of the Registration
Statement or the initiation of any proceedings for that purpose,
and (vi) if the rating assigned by Standard & Poor's Ratings
Group, a division of McGraw Hill, Inc., or ▇▇▇▇▇'▇ Investors
Service, Inc., as the case may be, to any debt securities of the
Company shall have been lowered or if either of such rating
agencies shall have publicly announced that it has under
surveillance or review, with possible negative implications, its
rating of any debt securities of the Company. The Company will
make every reasonable effort to prevent the issuance of any stop
order and, if any stop order is issued, to obtain the lifting
thereof at the earliest possible moment.
Notice of Certain Proposed Filings. The Company will
give the Agents notice of its intention to file or prepare any
additional registration statement with respect to the
registration of additional Notes or any amendment to the
Registration Statement or any amendment or supplement to the
Prospectus (other than an amendment or supplement providing
solely for a change in the interest rates or maturity dates of
Notes or similar changes or an amendment or supplement effected
by the filing of a document with the SEC pursuant to the ▇▇▇▇
▇▇▇) and, upon request, will furnish the Agents with copies of
any such registration statement or amendment or supplement
proposed to be filed or prepared a reasonable time in advance of
such proposed filing or preparation, as the case may be, and will
not file any such registration statement or amendment or
supplement in a form as to which the Agents or their counsel
reasonably object.
Copies of the Registration Statement and the
Prospectus and 1934 Act Filings. The Company will deliver to the
Agents as many signed and conformed copies of the Registration
Statement (as originally filed) and of each amendment thereto
(including exhibits filed therewith or incorporated by reference
therein and documents incorporated by reference in the
Prospectus) as the Agents may reasonably request. The Company
will furnish to the Agents as many copies of the Prospectus (as
amended or supplemented) as the Agents shall reasonably request
so long as the Agents are required to deliver a Prospectus in
connection with sales or solicitations of offers to purchase the
Notes under the Act. The Company will furnish to the Agents
copies of any Annual Report on Form 10-K, Quarterly Report on
Form 10-Q or Current Report on Form 8-K filed by the Company with
the Commission pursuant to the 1934 Act as soon as practicable
after the filing thereof.
Preparation of Pricing Supplements. The Company will
prepare, with respect to any Notes to be sold through or to an
Agent pursuant to this Agreement, a Pricing Supplement with
respect to such Notes in a form previously approved by the Agents
and will file such Pricing
Supplement with the SEC pursuant to Rule 424(b) under the 1933
Act not later than the close of business on the second business
day after the date on which such Pricing Supplement is first
used.
Revisions of Prospectus -- Material Changes. Except as
otherwise provided in subsection (k) of this Section, if at any
time during the term of this Agreement any event shall occur or
condition exist as a result of which it is necessary, in the
reasonable opinion of counsel for the Agents or counsel for the
Company, to further amend or supplement the Prospectus in order
that the Prospectus will not include an untrue statement of a
material fact or omit to state any material fact necessary in
order to make the statements therein not misleading in light of
the circumstances existing at the time the Prospectus is
delivered to a purchaser, or if it shall be necessary, in the
reasonable opinion of either such counsel, to amend or supplement
the Registration Statement or the Prospectus in order to comply
with the requirements of the 1933 Act or the 1933 Act
Regulations, immediate notice shall be given, and confirmed in
writing, to the Agents to cease the solicitation of offers to
purchase the Notes in the Agents' capacity as agent and to cease
sales of any Notes any Agent may then own as principal, and the
Company will promptly prepare and file with the SEC such
amendment or supplement, whether by filing documents pursuant to
the 1934 Act, the 1933 Act or otherwise, as may be necessary to
correct such untrue statement or omission or to make the
Registration Statement and Prospectus comply with such
requirements.
Prospectus Revisions -- Periodic Financial
Information. Except as otherwise provided in subsection (k) of
this Section, on or prior to the date on which there shall be
released to the general public interim financial statement
information related to the Company with respect to each of the
first three quarters of any fiscal year or preliminary financial
statement information with respect to any fiscal year, the
Company shall furnish such information to the Agents, confirmed
in writing, and thereafter shall cause the Prospectus to be
amended or supplemented to include or incorporate by reference
financial information with respect thereto, as well as such other
information and explanations as shall be necessary for an
understanding thereof, as may be required by the 1933 Act or the
1934 Act or otherwise.
Prospectus Revisions -- Audited Financial Information.
Except as otherwise provided in subsection (k) of this Section,
on or prior to the date on which there shall be released to the
general public financial information included in or derived from
the audited financial statements of the Company for the preceding
fiscal year, the Company shall furnish such information to the
Agents and thereafter shall cause the Registration Statement and
the Prospectus to be amended to include or incorporate by
reference such audited financial statements and the report or
reports, and consent or consents to such inclusion or
incorporation by reference, of the independent accountants with
respect thereto, as well as such other information and
explanations as shall be necessary for an understanding of such
financial statements, as may be required by the 1933 Act or the
1934 Act or otherwise.
Earnings Statements. The Company will make generally
available to its security holders as soon as practicable, but not
later than 90 days after the close of the period covered thereby,
an earnings statement (in form complying with the provisions of
Rule 158 under the ▇▇▇▇ ▇▇▇) covering each twelve-month period
beginning, in each case, not later than the first day of the
Company's fiscal quarter next following the "effective date" (as
defined in such Rule 158) of the Registration Statement with
respect to each sale of Notes.
Blue Sky Qualification. The Company will endeavor, if
necessary, in cooperation with the Agents, to qualify the Notes
for offering and sale under the applicable securities laws of
such states and other jurisdictions of the United States as the
Agents may designate and will maintain such qualifications in
effect for as long as may be required for the distribution of the
Notes; provided, however, that in no event shall the Company be
obligated to qualify to do business in any jurisdiction in which
it is not now so qualified or to take any action that would
subject it to service of process in suits, other than those
arising out of the offering and sale of the Notes, in any
jurisdiction where it is not now so subject. The Company will
file such statements and reports as may be required by the laws
of each jurisdiction in which the Notes have been qualified as
above provided. The Company will promptly advise the Agents of
the receipt by the Company of any notification with respect to
the suspension of the qualification of the Notes for sale in any
such state or jurisdiction or the initiating or threatening of
any proceeding for such purpose.
1934 Act Filings. During the period when the
Prospectus is required to be delivered under the 1933 Act, the
Company will file promptly all documents required to be filed
with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the 1934 Act. During the period when any Notes are outstanding,
the Company shall remain subject to the requirements either of
Section 13(a) or Section 15(d) of the 1934 Act, and will file
with each Form 10-Q and 10-K an Exhibit 12 Statement regarding
Computation of Ratios.
Suspension of Certain Obligations. The Company shall
not be required to comply with the provisions of subsections (e),
(f) or (g) of this Section during any period beginning on the
date on which the Agents shall have suspended solicitation of
purchases of the Notes in their capacity as agent pursuant to a
request from the Company or, if later, the date thereafter when
the Agents shall no longer hold any Notes purchased as principal
from the Company, and ending on the earlier of the date when the
Company shall request, by written notice to the Agents, that
solicitation of purchases of the Notes should be resumed or the
date when the Company shall subsequently agree for the Agents to
purchase Notes as principal.
Conditions of Obligations.
The obligations of an Agent to solicit offers to
purchase the Notes as agent of the Company, the obligations of
any purchasers of the Notes sold through any Agent as agent and
any obligation of an Agent to purchase Notes as principal or
otherwise will be subject to the
accuracy of the representations and warranties on the part of the
Company herein and to the accuracy of the statements of the
Company's officers made in any certificate furnished pursuant to
the provisions hereof, to the performance and observance by the
Company of all its covenants and agreements herein contained and
to the following additional conditions precedent:
Legal Opinions. On the date hereof, the Agents shall
have received the following legal opinions, dated as of the date
hereof and in form and substance satisfactory to the Agents:
Opinion of Special Counsel to the Company. The
opinion of Cleary, Gottlieb, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, special counsel to
the Company, to the effect that:
The Company is validly existing as a corporation
in good standing under the laws of the jurisdiction in
which it is organized.
The Company has corporate power to own its
properties and conduct its business as described in the
Prospectus.
The execution and delivery of the Indenture have
been duly authorized by all necessary corporate action of
the Company, and the Indenture has been duly executed and
delivered by the Company, and qualified under the 1939 Act,
and is a legal, valid, binding and enforceable agreement of
the Company (subject to applicable bankruptcy, insolvency
and similar laws affecting creditors' rights generally and
to general principles of equity).
The execution and delivery of the Notes have been
duly authorized by all necessary corporate action of the
Company, and when the terms of the Notes of any series have
been established and such Notes have been completed,
executed and authenticated, all in accordance with the
provisions of the resolutions of the Board of Directors of
the Company adopted on May 21, 1998 and August 20, 1998
(the "Board Resolutions") and the Indenture and delivered
and paid for pursuant to this Agreement, such Notes will
constitute legal, valid, binding and enforceable
obligations of the Company (subject to applicable
bankruptcy, insolvency and similar laws affecting
creditors' rights generally and to general principles of
equity), entitled to the benefits of the Indenture.
The statements set forth under the headings
"Description of Debt Securities" and "Description of Notes"
in the Prospectus, insofar as such statements purport to
summarize certain provisions of the Notes and the
Indenture, provide a fair summary of such provisions.
The statements made in the Prospectus under the
heading "United States Federal Income Taxation," insofar as
such statements purport to summarize certain
federal income tax laws of the United States, constitute a
fair summary of the principal U.S. federal income tax
consequences of an investment in the Notes.
The execution and delivery of this Agreement
have been duly authorized by all necessary corporate action
of the Company, and this Agreement has been duly executed
and delivered by the Company, and is a legal, valid,
binding and enforceable agreement of the Company (subject
to applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally and to general
principles of equity, and except that such counsel need
express no opinion with respect to Section 7 of this
Agreement providing for indemnification and contribution).
Any required filing of the Prospectus (including
all supplements thereto) pursuant to Rule 424(b) has been
made in the manner and within the time period required by
Rule 424(b).
In rendering such opinion, such counsel may rely as to
matters of fact, to the extent deemed proper, on certificates of
responsible officers of the Company and public officials.
In addition to giving its opinion as required by this
subsection (a)(1) above, such special counsel shall deliver a
letter of even date with such opinion in which such special
counsel shall state, without expressing an opinion thereon, that
although they are not passing upon and do not assume any
responsibility for, the accuracy, completeness or fairness
generally of the statements contained in the Registration
Statement or the Prospectus (except as provided in clauses (v)
and (vi) of subsection (a)(1) above) and make no representation
that they have independently verified the accuracy, completeness
or fairness generally of such statements (except as aforesaid),
on the basis set forth in such letter (i) the Registration
Statement (except the financial statements, schedules and other
financial and statistical information included therein and any
documents incorporated by reference therein, as to which such
counsel need to express no opinion) at the time it became
effective, and the Prospectus (except as aforesaid), as of the
date thereof, appeared on their face to be appropriately
responsive in all material respects to the requirements of the
1933 Act and the 1939 Act and the rules and regulations
thereunder, other than Regulation S-T under the 1933 Act and such
counsel do not know of any contracts or other documents of a
character required to be filed as exhibits to the Registration
Statement or required to be described in the Registration
Statement or the Prospectus, that are not filed or described as
required or threatened by the SEC ; (ii) no information has come
to such counsel's attention that causes such counsel to believe
that the Registration Statement (other than the financial
statements, schedules and other financial and statistical data
included therein as to which such counsel need to express no
opinion), at the time it became effective, contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; (iii) no information has come to such
counsel's attention that causes such counsel to believe that the
Prospectus (except as aforesaid), as of the date thereof or on
the date hereof, contained or contains an untrue statement or a
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material fact or omitted or omits to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which
they were made, not misleading; and (iv) the Registration
Statement is effective under the 1933 Act and, to the best of
such counsel's knowledge, no stop order with respect thereto has
been issued, and no proceeding for that purpose has been
instituted or threatened, by the SEC; and to the best of such
counsel's knowledge, no order directed to any document
incorporated by reference in the Registration Statement or the
Prospectus has been issued by the SEC and remains in effect, and
no proceeding for that purpose has been instituted.
Opinion of Company General Counsel. The opinion
of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President, General Counsel
and Secretary of the Company, to the effect that:
Each of the Company and Marine Midland Bank (the
"Subsidiary") has been duly incorporated and is validly
existing as a corporation in good standing under the laws
of the jurisdiction in which it is chartered or organized,
with full corporate power and authority to own or lease, as
the case may be, and to operate its properties and conduct
its business as described in the Prospectus, and is duly
qualified to do business as a foreign corporation and is in
good standing under the laws of each jurisdiction which
requires such qualification; and the Company is duly
registered as a bank holding company under the Bank Holding
Company Act of 1956, as amended.
All the outstanding shares of capital stock of
the Subsidiary have been duly and validly authorized and
issued and are fully paid and nonassessable, and, except as
otherwise set forth in the Prospectus, all outstanding
shares of capital stock of the Subsidiary are owned,
directly or indirectly, by the Company free and clear of
any perfected security interest and, to the knowledge of
such counsel, after due inquiry, any other security
interest, claim, lien or encumbrance.
The execution and delivery of the Indenture have
been duly authorized by all necessary corporate action of
the Company, and the Indenture has been duly executed and
delivered by the Company, and qualified under the 1939 Act,
and is a legal, valid, binding and enforceable agreement of
the Company (subject to applicable bankruptcy, insolvency
and similar laws affecting creditors' rights generally and
to general principles of equity).
The execution and delivery of the Notes have been
duly authorized by all necessary corporate action of the
Company, and when the terms of the Notes of any series have
been established and such Notes have been completed,
executed and authenticated, all in accordance with the
provisions of the Board Resolutions and the Indenture and
delivered and paid for pursuant to this Agreement, such
Notes will constitute legal, valid, binding and enforceable
obligations of the Company (subject to applicable
bankruptcy,
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insolvency and similar laws affecting creditors' rights
generally and to general principles of equity), entitled to
the benefits of the Indenture.
The statements set forth under the headings
"Description of Debt Securities" and "Description of Notes"
in the Prospectus, insofar as such statements purport to
summarize certain provisions of the Notes and the
Indenture, provide a fair summary of such provisions.
The execution and delivery of this Agreement have
been duly authorized by all necessary corporate action of
the Company, and this Agreement has been duly executed and
delivered by the Company, and is a legal, valid, binding
and enforceable agreement of the Company (subject to
applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally and to general
principles of equity, and except that such counsel need
express no opinion with respect to Section 7 of this
Agreement providing for indemnification and contribution).
The Registration Statement is effective under the
1933 Act; any required filing of the Prospectus (including
all supplements thereto) pursuant to Rule 424(b) has been
made in the manner and within the time period required by
Rule 424(b); to the knowledge of such counsel no stop order
suspending the effectiveness of the Registration Statement
has been issued, and no proceeding for that purpose has
been instituted or threatened by the SEC; and the
Registration Statement and the Prospectus (other than the
financial statements and schedules and other financial and
statistical data included therein or incorporated by
reference therein, as to which such counsel need express no
opinion) comply as to form in all material respects with
the applicable requirements of the 1933 Act, the 1934 Act
and the 1939 Act and the respective rules and regulations
thereunder, other than Regulation S-T under the 1933 Act.
To the knowledge of such counsel, except as
disclosed in the Registration Statement or the Prospectus,
there is no pending or threatened action, suit or
proceeding before or by any court or governmental agency,
authority or body or any arbitrator involving the Company
or any of the Subsidiaries, of a character required to be
disclosed in the Registration Statement, which is not
adequately disclosed in the Prospectus, and there is no
franchise, contract or other document of a character
required to be described in the Registration Statement or
the Prospectus, or to be filed as an exhibit, which is not
described or filed as required; and the statements included
or incorporated by reference in the Prospectus describing
any legal proceedings relating to the Company fairly
summarize such matters.
The Company is not and, after giving effect to
the offering and sale of the Notes and the application of
the proceeds thereof as described in the Prospectus, as
12
supplemented or amended, will not be an "investment
company" as defined in the Investment Company Act of 1940,
as amended.
No consent, approval, authorization, filing with
or order of any court or governmental agency or body is
required in connection with the transactions contemplated
herein, except such as have been obtained under the 1933
Act or 1933 Act Regulations and such as may be required
under the blue sky laws of any jurisdiction in connection
with the purchase and/or distribution of the Notes by the
Agents in the manner contemplated in this Agreement and in
the Prospectus, as supplemented or amended, and such other
approvals (specified in such opinion) as have been
obtained.
Neither the issue and sale of the Notes, nor the
consummation of any other of the transactions herein
contemplated nor the fulfillment of the terms hereof will
conflict with, result in a breach or violation of or
imposition of any lien, charge or encumbrance upon any
property or assets of the Company or its subsidiaries
pursuant to, (i) the charter or by-laws of the Company or
its subsidiaries, (ii) the terms of any indenture,
contract, lease, mortgage, deed of trust, note agreement,
loan agreement or other agreement, obligation, condition,
covenant or instrument to which the Company or its
subsidiaries is a party or by which it is bound or to which
its or their property is subject, or (iii) any statute,
law, rule, regulation, judgment, order or decree applicable
to the Company or its subsidiaries of any court, regulatory
body, administrative agency, governmental body, arbitrator
or other authority having jurisdiction over the Company or
its subsidiaries or any of its or their properties.
No holders of securities of the Company have
rights to the registration of such securities under the
Registration Statement
In rendering such opinion, such counsel may rely (A)
as to matters involving the application of laws of any
jurisdiction other than the States of New York and Delaware or
the federal laws of the United States, to the extent deemed
proper and specified in such opinion, upon the opinion of other
counsel of good standing believed to be reliable and who are
satisfactory to counsel for the Agents; and (B) as to matters of
fact, to the extent deemed proper, on certificates of responsible
officers of the Subsidiary and public officials.
Opinion of Counsel to the Agents. The opinion of
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇, counsel to the Agents, covering
to substantially similar effect the matters referred to in
subsection (a)(1) of this Section, except that such counsel need
not address the matters referred to in clauses (ii) and (vi).
In rendering such opinion, such counsel may rely as to
matters of fact, to the extent deemed proper, on certificates of
responsible officers of the Company and public officials.
13
Officer's Certificate. On the date hereof, the Agents
shall have received a certificate of the Chairman of the Board,
the President or any Executive Vice President, and the Chief
Financial Officer or the Controller of the Company, dated as of
the date hereof, to the effect that the signers of such
certificate have carefully examined the Registration Statement,
the Prospectus and this Agreement and that to the best of their
knowledge (i) since the respective dates as of which information
is given in the Registration Statement and the Prospectus, there
has not been any material adverse change in the condition,
financial or otherwise, or in the prospects, earnings, business
or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary
course of business, except as set forth or contemplated in the
Prospectus, as supplemented or amended, (ii) the other
representations and warranties of the Company contained in
Section 2 hereof are true and correct in all material respects
with the same force and effect as though expressly made at and as
of the date of such certificate, (iii) the Company has performed
or complied with all agreements and satisfied all conditions on
its part to be performed or satisfied hereunder at or prior to
the date of such certificate, and (iv) no stop order suspending
the effectiveness of the Registration Statement has been issued
and no proceeding for that purpose has been instituted or, to the
Company's knowledge, threatened by the SEC.
Other Documents. On the date hereof and on each
Settlement Date with respect to any purchase of Notes by an Agent
as principal, counsel to the Agents shall have been furnished
with such documents and opinions as such counsel may reasonably
require for the purpose of enabling such counsel to pass upon the
issuance and sale of Notes as herein contemplated, or in order to
evidence the accuracy and completeness of any of the
representations and warranties, or the fulfillment of any of the
conditions, contained herein; and all proceedings taken by the
Company in connection with the issuance and sale of Notes as
herein contemplated shall be satisfactory in form and substance
to such Agent and to counsel to the Agents.
Rating of Notes. On the date hereof and at all times
hereafter during the term of this Agreement, the Notes shall have
a rating of BBB- or above by Standard & Poor's Ratings Group, a
division of McGraw Hill, Inc., or Baa3 or above by ▇▇▇▇▇'▇
Investors Service, Inc., as the case may be.
Listing of Securities. On the date hereof and at all
times hereafter, either (i) the Company shall have a class of
securities that is listed, or authorized for listing, on the New
York Stock Exchange or the American Stock Exchange, or listed on
the National Market System of the Nasdaq Stock Market (or any
successor to such entities), or (ii) the Company shall have
provided evidence satisfactory to the Agents and to counsel to
the Agents of the qualification or exemption from qualification
of the offering and sale of the Notes under the applicable
securities laws of all states of the United States and the
District of Columbia.
14
If any condition specified in this Section 4 shall not
have been fulfilled in all material respects when and as required
to be fulfilled, this Agreement may be terminated by the Agents
by notice to the Company at any time and any such termination
shall be without liability of any party to any other party,
except that the covenant regarding provision of an earnings
statement set forth in Section 3(h) hereof, the provisions
concerning payment of expenses under Section 8 hereof, the
indemnity and contribution agreements set forth in Section 7
hereof, the provisions concerning the representations, warranties
and agreements to survive delivery set forth in Section 9 hereof
and the provisions regarding parties set forth under Section 13
hereof shall remain in effect.
Delivery of and Payment for Notes Sold through the Agents.
Delivery of Notes sold through an Agent as agent shall
be made by the Company to such Agent for the account of any
purchaser only against payment therefor in immediately available
funds. In the event that a purchaser shall fail either to accept
delivery of or to make payment for a Note on the date fixed for
settlement, the Agent shall promptly notify the Company and
deliver the Note to the Company, and, if the Agent has
theretofore paid the Company for such Note, the Company will
promptly return such funds to the Agent. If such failure occurred
for any reason other than default by the Agent in the performance
of its obligations hereunder, the Company will reimburse the
Agent on an equitable basis for its loss of the use of the funds
for the period such funds were credited to the Company's account.
Unless otherwise agreed between the Company and the Agent, all
Notes will be issued in book-entry only form and will be
represented by one or more fully registered global securities.
Additional Covenants of the Company.
The Company covenants and agrees with the Agents that:
Reaffirmation of Representations and Warranties. Each
acceptance by it of an offer for the purchase of Notes, and each
delivery of Notes to an Agent pursuant to a sale of Notes to such
Agent as principal, shall be deemed to be an affirmation that the
representations and warranties of the Company contained in this
Agreement and in any certificate theretofore delivered to such
Agent pursuant hereto are true and correct at the time of such
acceptance or sale, as the case may be, and an undertaking that
such representations and warranties will be true and correct at
the time of delivery to the purchaser or his agent, or to such
Agent, of the Note or Notes relating to such acceptance or sale,
as the case may be, as though made at and as of each such time
(and it is understood that such representations and warranties
shall relate to the Registration Statement and Prospectus as
amended and supplemented to each such time).
Subsequent Delivery of Certificates. (i) Each time
that there is filed with the SEC any Quarterly Report on Form
10-Q or Annual Report on Form 10-K that is incorporated by
reference into the Prospectus, (ii) on the date of each Terms
Agreement for a purchase of Notes
15
by an Agent as principal pursuant to Section 1(d) hereof, and
(iii) at the written request of the Agents in the case of each
such amendment or supplement, the Registration Statement or the
Prospectus shall be amended or supplemented (other than by an
amendment or supplement providing solely for a change in the
interest rates or maturity dates of Notes or similar changes, an
amendment or supplement which relates exclusively to an offering
of securities other than the Notes or, except as hereinbefore
described, an amendment or supplement resulting from the filing
of any document incorporated by reference therein), the Company
shall furnish or cause to be furnished to the Agents forthwith a
certificate of the Chairman of the Board, the President, the
principal financial officer or the principal accounting officer
of the Company dated the date of filing with the SEC of such
supplement or document or the date of effectiveness of such
amendment or date of such purchase as the case may be, in form
satisfactory to the Agents to the effect that the statements
contained in the certificate referred to in Section 4(b) hereof
which was last furnished to the Agents are true and correct at
the time of such filing, supplement, amendment or purchase, as
the case may be, as though made at and as of such time (except
that such statements shall be deemed to relate to the
Registration Statement and the Prospectus as amended and
supplemented to such time) or, in lieu of such certificate, a
certificate of the same tenor as the certificate referred to in
said Section 4(b), modified as necessary to relate to the
Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such certificate.
Subsequent Delivery of Legal Opinions. (i) Each time
that there is filed with the SEC any Quarterly Report on Form
10-Q or Annual Report on Form 10-K that is incorporated by
reference into the Prospectus, (ii) on the date of each Terms
Agreement for a purchase of Notes by an Agent as principal
pursuant to Section 1(d) hereof, and (iii) at the reasonable
written request of the Agents in the case of each such filing,
amendment or supplement, each time that there is filed with the
SEC any report on Form 8-K, or the Registration Statement or the
Prospectus shall be amended or supplemented (other than by an
amendment or supplement providing solely for a change in the
interest rates or maturity dates of the Notes or similar changes
or solely for the inclusion of additional financial information,
an amendment or supplement which relates exclusively to an
offering of securities other than the Notes or, except as
hereinbefore described, an amendment or supplement resulting from
the filing of any document incorporated by reference therein),
the Company shall furnish or cause to be furnished forthwith to
the Agents and to counsel to the Agents the written opinions of
Cleary, Gottlieb, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel to the Company,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Executive Vice President, General Counsel and
Secretary to the Company, or other counsel satisfactory to the
Agents, dated the date of filing with the SEC of such supplement
or the date of effectiveness of such amendment or the date of
such purchase, as the case may be, in form and substance
satisfactory to the Agents, of the same tenor as the opinions
referred to in Section 4(a) hereof, but modified, as necessary,
to relate to the Registration Statement and the Prospectus as
amended and supplemented to the time of delivery of such
opinions; or, in lieu of such opinions, such counsel, or counsel
last furnishing such opinions to the Agents, shall furnish the
Agents with a letter substantially to the effect that
16
the Agents may rely on such last opinion to the same extent as
though it was dated the date of such letter authorizing reliance
(except that statements in such last opinion shall be deemed to
relate to the Registration Statement and the Prospectus as
amended and supplemented to the time of delivery of such letter
authorizing reliance).
Delivery of Comfort Letters. At the times and under
the circumstances set forth below, the Company shall cause KPMG
Peat Marwick LLP ("KPMG") to furnish the Agents a letter, in form
and substance satisfactory to the Agents, to the effect that:
They are independent public accountants with
respect to the Company and its subsidiaries within the
meaning of the 1933 Act and the 1934 Act Regulations.
In their opinion, the consolidated financial
statements of the Company and its subsidiaries audited by
them and included or incorporated by reference in the
Registration Statement and Prospectus and reported on by
them comply as to form in all material respects with the
applicable accounting requirements of the 1933 Act and the
1934 Act and the related published rules and regulations.
On the basis of procedures (but not an audit in
accordance with generally accepted auditing standards)
consisting of:
(a) Reading the minutes of the meetings of
the stockholders, the board of directors, executive
committee and audit committee of the Company and the boards
of directors and executive committees of its subsidiaries
as set forth in the minute books through a specified date
not more than five business days prior to the date of
delivery of such letter;
(b) Performing the procedures specified by
the American Institute of Certified Public Accountants for
a review of interim financial information as described in
SAS NO. 71, Interim Financial Information, on the unaudited
consolidated interim financial statements of the Company
and its consolidated subsidiaries included or incorporated
by reference in the Registration Statement and Prospectus
and reading the unaudited interim financial data, if any,
for the period from the date of the latest balance sheet
included or incorporated by reference in the Registration
Statement and Prospectus to the date of the latest
available interim financial data; and
(c) Making inquiries of certain officials of
the Company who have responsibility for financial and
accounting matters regarding the specific items for which
representations are requested below;
nothing has come to their attention as a result of the foregoing
procedures that caused them to believe that:
17
(1) any material modifications should be
made to the unaudited consolidated interim financial
statements, included or incorporated by reference in the
Registration Statement and Prospectus, for them to be in
conformity with generally accepted accounting principles;
(2) the unaudited consolidated interim
financial statements, included or incorporated by reference
in the Registration Statement and Prospectus, do not comply
as to form in all material respects with the applicable
accounting requirements of the 1934 Act and the published
rules and regulations thereunder;
(3) (i) at the date of the latest available
interim financial data and at the specified date not more
than five business days prior to the date of the delivery
of such letter, there was any change in the capital stock
or the long-term debt (other than scheduled repayments of
long-term debt) or any decrease in shareholders' equity of
the Company and the subsidiaries on a consolidated basis as
compared with the amounts shown in the latest balance sheet
included or incorporated by reference in the Registration
Statement and the Prospectus or (ii) or the period from the
date of the latest available financial data to a specified
date not more than five business days prior to the delivery
of such letter, there was any change in the capital stock
or the long-term debt (other than scheduled repayments of
long-term debt) or any decreases in shareholders' equity of
the Company and the subsidiaries on a consolidated basis,
except in all instances for changes or decreases which the
Registration Statement and Prospectus discloses have
occurred or may occur, or KPMG shall state any specific
changes or decreases.
The letter shall also state that KPMG has carried
out certain other specified procedures, not constituting an
audit, with respect to certain amounts, percentages and
financial information which are included or incorporated by
reference in the Registration Statement and Prospectus and
which are specified by the Agents and agreed to by KPMG,
and has found such amounts, percentages and financial
information to be in agreement with the relevant
accounting, financial and other records of the Company and
its subsidiaries identified in such letter.
The Company shall cause such a letter to be delivered
to the Agents (A) on the date of each Terms Agreement for the
purchase of Notes by an Agent as principal pursuant to Section
1(d) hereof, dated as of such date, (B) within five business days
of the relevant filing date, each time that there is filed with
the SEC by the Company any Annual Report on Form 10- K or
Quarterly Report on Form 10-Q that is incorporated by reference
into the Prospectus, dated the date of filing of such report with
the SEC and (C) if reasonably required by the Agents, within five
days of written request by the Agents, each time that there is
filed any Current Report on Form 8-K that includes financial
information, and each time that the Registration Statement or
Prospectus shall be amended or supplemented to include additional
financial information, dated the date of effectiveness of such
filing, amendment or supplement, as the case may be. Each
18
such letter shall be of the tenor described above in clauses (i)
through (iv) but modified to relate to the Registration Statement
and Prospectus, as amended and supplemented through the date of
such letter, and with such changes as may be necessary to reflect
changes in the financial statements and other information derived
from the accounting records of the Company, and otherwise in form
satisfactory to the Agents.
Suspension of Certain Obligations. The Company shall
not be required to comply with the provisions of subsections (b),
(c) or (d) of this Section during any period beginning on the
date on which the Agents shall have suspended solicitation of
purchases of the Notes in their capacity as agent pursuant to a
written request from the Company or, if later, the date
thereafter when the Agents shall no longer hold any Notes
purchased as principal from the Company, and ending on the
earlier of the date when the Company shall request, by written
notice to the Agents, that solicitation of purchases of the Notes
should be resumed or the date when the Company shall subsequently
agree for the Agents to purchase Notes as principal.
Indemnification and Contribution.
The Company agrees to indemnify and hold harmless each
Agent, the directors, officers, employees and agents of each
Agent, and each person who controls any Agent within the meaning
of either the 1933 Act or the 1934 Act against any and all
losses, claims, damages or liabilities, joint or several, to
which they or any of them may become subject under the 1933 Act,
the 1934 Act or other Federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in the Registration
Statement as originally filed or in any amendment thereof, or
arise out of or are based upon any omission or alleged omission
to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or arise
out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the Prospectus, or any
amendment or supplement thereof, or arise out of or are based
upon any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which
they were made, not misleading, and agrees to reimburse each such
indemnified party, as incurred, for any legal or other expenses
reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action;
provided, however, that the Company will not be liable in any
such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with
written information furnished to the Company by or on behalf of
any Agent specifically for inclusion therein, or arises out of or
is based upon statements in or omissions from that part of the
Registration Statement which shall constitute the Statement of
Eligibility and Qualification of the Trustee (Form T-1) under the
1939 Act of the Trustee, and (ii) such indemnity with respect to
the Prospectus shall not inure to the benefit of any Agent (or
any person controlling such Agent)
19
from whom the person asserting any such loss, claim, damage or
liability purchased the Notes which are the subject thereof if
such person did not receive a copy of the Prospectus as amended
or supplemented in connection with the sale of such Notes
excluding documents incorporated therein by reference at or prior
to the written confirmation of the sale of such Notes to such
person in any case where such delivery is required by the 1933
Act and the untrue statement or omission of a material fact
contained in the Prospectus was corrected in the Prospectus as
amended or supplemented. This indemnity agreement will be in
addition to any liability which the Company may otherwise have.
Each Agent severally and not jointly agrees to
indemnify and hold harmless the Company, each of its directors,
each of its officers who signs the Registration Statement, and
each person who controls the Company within the meaning of either
the 1933 Act or the 1934 Act, to the same extent as the foregoing
indemnity from the Company to each Agent, but only with reference
to written information relating to such Agent furnished to the
Company by or on behalf of such Agent specifically for inclusion
in the documents referred to in the foregoing indemnity. This
indemnity agreement will be in addition to any liability which
any Agent may otherwise have. The Company acknowledges that the
statements set forth (i) in the last two paragraphs on the cover
page, (ii) in the first paragraph on page S-2 relating to
stabilization and (iii) under the heading "Plan of Distribution"
in the Prospectus, as supplemented or amended, constitute the
only information furnished in writing by or on behalf of the
several Agents for inclusion in the documents referred to in the
foregoing indemnity, and you, as the Agents, confirm that such
statements are correct.
Promptly after receipt by an indemnified party under
this Section 7 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be
made against the indemnifying party under this Section 7, notify
the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not
relieve it from liability under paragraph (a) or (b) above unless
and to the extent it did not otherwise learn of such action and
such failure results in the forfeiture by the indemnifying party
of substantial rights and defenses and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any
indemnified party other than the indemnification obligation
provided in paragraph (a) or (b)above. The indemnifying party
shall be entitled to appoint counsel of the indemnifying party's
choice at the indemnifying party's expense to represent the
indemnified party in any action for which indemnification is
sought (in which case the indemnifying party shall not thereafter
be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth
below); provided, however, that such counsel shall be
satisfactory to the indemnified party. Notwithstanding the
indemnifying party's election to appoint counsel to represent the
indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel),
and the indemnifying party shall bear the reasonable fees, costs
and expenses of such separate counsel if (i) the use of counsel
chosen by the indemnifying party to represent the indemnified
party would present such
counsel with a conflict of interest, (ii) the actual or potential
defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified
party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which
are different from or additional to those available to the
indemnifying party, (iii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after
notice of the institution of such action or (iv) the indemnifying
party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party. An indemnifying
party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry
of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or
contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim
or action) unless such settlement, compromise or consent includes
an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding.
In the event that the indemnity provided in paragraph
(a) or (b) of this Section 7 is unavailable to or insufficient to
hold harmless an indemnified party for any reason, the Company
and the Agents severally agree to contribute to the aggregate
losses, claims, damages and liabilities (including legal or other
expenses reasonably incurred in connection with investigating or
defending same)(collectively "Losses") to which the Company and
one or more of the Agents may be subject in such proportion as is
appropriate to reflect the relative benefits received by the
Company on the one hand and by the Agents on the other from the
offering of the Notes; provided, however, that in no case shall
any Agent (except as may be provided in any agreement among
underwriters relating to the offering of the Notes) be
responsible for any amount in excess of the underwriting discount
or commission applicable to the Notes purchased by or through
such Agent hereunder. If the allocation provided by the
immediately preceding sentence is unavailable for any reason, the
Company and the Agents severally shall contribute 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 of the Agents on the other in connection with the
statements or omissions which resulted in such Losses as well as
any other relevant equitable considerations. Benefits received by
the Company shall be deemed to be equal to the total net proceeds
from the offering of Notes (before deducting expenses) received
by it, and benefits received by the Agents shall be deemed to be
equal to the total underwriting discounts and commissions, in
each case to the date of the Loss. Relative fault shall be
determined by reference to, among other things, whether any
untrue or any alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to
information provided by the Company on the one hand or the Agent
on the other, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The Company and the
Agents agree that it would not be just and equitable if
contribution were determined by pro rata allocation or any other
method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the
21
provisions of this paragraph (d), no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation. For purposes of
this Section 7, each person who controls an Agent within the
meaning of either the Act or the Exchange Act and each director,
officer, employee and agent of an Agent shall have the same
rights to contribution as such Agent, and each person who
controls the Company within the meaning of either the Act or the
Exchange Act, each officer of the Company who shall have signed
the Registration Statement and each director of the Company shall
have the same rights to contribution as the Company, subject in
each case to the applicable terms and conditions of this
paragraph (d).
Payment of Expenses.
The Company will pay all expenses incident to the
performance of its obligations under this Agreement, including:
The preparation and filing of the Registration
Statement and all amendments thereto and the Prospectus and
any amendments or supplements thereto;
The preparation, filing and reproduction of this
Agreement;
The preparation, printing, issuance and delivery
of the Notes, including any fees and expenses relating to
the use of book-entry notes;
The qualification of the Notes under state
securities or insurance laws in accordance with the
provisions of Section 4(i) hereof, including filing fees
and the reasonable fees and disbursements of counsel for
the Agents in connection therewith and in connection with
the preparation of any Blue Sky Survey and any Legal
Investment Survey;
The printing and delivery to the Agent in
quantities as hereinabove stated of copies of the
Registration Statement and any amendments thereto, and of
the Prospectus and any amendments or supplements thereto,
and the delivery by the Agent of the Prospectus and any
amendments or supplements thereto in connection with
solicitations or confirmations of sales of the Notes;
The preparation, printing, reproduction and
delivery to the Agents of copies of the Indentures and all
supplements and amendments thereto;
The rating of the Notes;
If applicable, the listing of the Notes on any
securities exchange;
Any filing with the National Association of
Securities Dealers, Inc.; and
22
Securing any CUSIP or other identification
numbers for the Notes.
The Company shall also pay the fees and disbursements of the
Trustee (including the reasonable fees and disbursements of
counsel to the Trustee), any registrar, transfer agent, paying
agent, calculation agent and any book-entry system depositary (or
nominee thereof) with respect to the Notes and of the Company's
independent public accountants and special counsel.
In addition to the expenses specified in paragraph (a)
the Company will pay or reimburse:
The reasonable fees and disbursements of counsel
to the Agents incurred from time to time in connection with
the transactions contemplated hereby; and
Any advertising and other out-of-pocket expenses
of the Agents incurred in connection with the offering of
the Notes with the prior written approval of the Company.
Representations, Warranties and Agreements to Survive
Delivery.
All representations, warranties and agreements
contained in this Agreement or in certificates of officers of the
Company submitted pursuant hereto shall remain operative and in
full force and effect, regardless of any investigation made by or
on behalf of any Agent or any controlling person of any Agent, or
by or on behalf of the Company, and shall survive each delivery
of and payment for any of the Notes.
Termination.
Termination of this Agreement. This Agreement
(excluding any agreement hereunder by an Agent to purchase Notes
as principal) may be terminated for any reason, with respect to
one or more, or all, of the Agents, at any time by either the
Company or one or more of the Agents upon the giving of 30 days'
written notice of such termination to the other party hereto. Any
termination by the Company of this Agreement with respect to one
or more, but less than all, of the Agents shall be effective with
respect to such designated Agents only, and the Agreement will
remain in force and effect with respect to any other Agents who
remain parties hereto.
Termination of Agreement to Purchase Notes as
Principal. An Agent may terminate any agreement hereunder by such
Agent to purchase Notes as principal, immediately upon notice to
the Company at any time prior to the Settlement Date relating
thereto, (i) if there has been, since the date of such agreement
or since the respective dates as of which information is given in
the Registration Statement, any material adverse change in the
condition, financial or otherwise, or in the prospects, earnings,
business or properties of the Company and its
23
subsidiaries, taken as a whole, or (ii) if there shall have
occurred, since the date of such agreement, any outbreak or
material escalation of hostilities or other national or
international calamity or crisis the effect of which is such as
to make it, in the judgment of such Agent, impracticable to
market the Notes or enforce contracts for the sale of the Notes,
or (iii) if, since the date of such agreement, trading in
securities generally on the New York Stock Exchange shall have
been suspended or limited, or (iv) if, since the date of such
agreement, a banking moratorium shall have been declared by
either Federal or New York authorities.
If, after the date of an agreement hereunder to
purchase Notes as principal and prior to the Settlement Date with
respect to such agreement, the rating assigned by Standard &
Poor's Ratings Group, a division of McGraw Hill, Inc., or ▇▇▇▇▇'▇
Investors Service, Inc., as the case may be, to any debt
securities of the Company shall have been lowered or if either of
such rating agencies shall have publicly announced that it has
under surveillance or review, with possible negative
implications, its rating of any debt securities of the Company,
then the Company and the Agent mutually shall determine whether
the terms of such agreement to purchase Notes shall need to be
renegotiated and, if so, shall so negotiate in good faith the
revised terms of such agreement to purchase Notes. In the event
that the Company and the Agent reasonably fail to agree on any
such revised terms, then either the Company or the Agent may
terminate such agreement to purchase Notes.
General. In the event of a termination under this
Section 10, or following the Settlement Date in connection with a
sale to or through an Agent appointed on a one-time basis,
neither party will have any liability to the other party hereto,
except that (i) the Agents shall be entitled to any commission
earned in accordance with Section 1(c) hereof, (ii) if at the
time of termination (a) any Agent shall own any Notes purchased
by it as principal with the intention of reselling them or (b) an
offer to purchase any of the Notes has been accepted by the
Company but the time of delivery to the purchaser or his agent of
the Note or Notes relating thereto has not occurred, the
covenants set forth in Sections 3 and 6 hereof shall remain in
effect until such Notes are so resold or delivered, as the case
may be, and (iii) the covenant set forth in Section 3(h) hereof,
the provisions of Section 8 hereof, the indemnity and
contribution agreements set forth in Section 7 hereof, and the
provisions of Sections 9, 12 and 13 hereof shall remain in
effect.
Notices.
Unless otherwise provided herein, all notices required
under the terms and provisions hereof shall be in writing, either
delivered by hand, by mail or by telex, telecopier or telegram.
Notices to the Company shall be delivered to it at the address
specified below and notices to any Agent shall be delivered to it
at the address set forth on Exhibit A.
If to the Company:
HSBC Americas, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy (which shall not constitute notice) to:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Executive Vice President,
General Counsel and Secretary
HSBC Americas, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Cleary, Gottlieb, ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
or at such other address as such party may designate from time to
time by notice duly given in accordance with the terms of this
Section 11.
Governing Law; Counterparts.
This Agreement and all the rights and obligations of
the parties shall be governed by and construed in accordance with
the laws of the State of New York applicable to agreements made
and to be performed in such State. This Agreement may be executed
in counterparts and the executed counterparts shall together
constitute a single instrument.
Parties.
This Agreement shall inure to the benefit of and be
binding upon the Agents and the Company and their respective
successors. Nothing expressed or mentioned in this Agreement is
intended or shall be construed to give any person, firm or
corporation, other than the parties hereto and their respective
successors and the controlling persons and officers and directors
referred to in Section 7 and their heirs and legal
representatives, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision herein
contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and
25
exclusive benefit of the parties hereto and respective successors
and said controlling persons and officers and directors and their
heirs and legal representatives, and for the benefit of no other
person, firm or corporation. No purchaser of Notes shall be
deemed to be a successor by reason merely of such purchase.
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to the
Company a counterpart hereof, whereupon this instrument along
with all counterparts will become a binding agreement between the
Agents and the Company in accordance with its terms.
Very truly yours,
HSBC AMERICAS, INC.
By:
Name:
Title:
Accepted:
HSBC SECURITIES, INC.
By:
Name:
Title:
[Signatures By Agents To Follow]
26
[Signature Page for Agents]
▇▇▇▇▇▇ BROTHERS INC.
By:
Name:
Title:
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED
By:
Name:
Title:
SALOMON BROTHERS INC
By:
Name:
Title:
27
EXHIBIT A
AGENTS
HSBC Securities, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy (which shall not constitute notice) to:
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
[Names and Addresses of Additional Agents]
▇▇▇▇▇▇ Brothers Inc.
Three World Financial Center
New York, New York 10285
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
World Financial Center
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Salomon Brothers Inc
▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
28
EXHIBIT B
The following terms, if applicable, shall be agreed to
by an Agent and the Company in connection with each sale of Notes
on an agency basis:
Principal Amount: $__________
Interest Rate:
If Fixed Rate Note, Interest Rate:
If Floating Rate Note:
Interest Rate Basis:
Base Rate:
Initial Interest Rate:
Index Maturity:
Index Maturity for Initial Interest
Rate (if different):
Index Maturity for Final Interest
Payment Period (if different):
Spread or Spread Multiplier, if any:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Interest Payment Date(s):
Interest Rate Reset Dates:
Interest Rate Reset Period:
Calculation Agent:
If Redeemable:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
Original Issue Date:
Stated Maturity Date:
Final Maturity Date:
Repayment Date(s)
Purchase Price: _____%
Settlement Date and Time:
Extendible:
29
Renewable:
Additional Terms:
30
EXHIBIT C
As compensation for the services of an Agent
hereunder, the Company shall pay it, on a discount basis, a
commission for the sale of each Note by such Agent which, unless
otherwise agreed between the Company and Agent, shall be equal to
the principal amount of such Note multiplied by the appropriate
percentage set forth below:
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
From 9 months to less than 1 year.............. .125%
From 1 year to less than 18 months............. .150
From 18 months to less than 2 years............ .200
From 2 years to less than 3 years.............. .250
From 3 years to less than 4 years.............. .350
From 4 years to less than 5 years.............. .450
From 5 years to less than 6 years.............. .500
From 6 years to less than 7 years.............. .550
From 7 years to less than 10 years............. .600
From 10 years to less than 15 years............ .625
From 15 years to less than 20 years............ .700
From 20 years to less than 30 years............ .750
The commission for Notes with a maturity 30 years or more or sold
to one or more Agents as principal also is subject to negotiation
between the Company and the Agent at the time of sale.
31
EXHIBIT D
HSBC AMERICAS, INC.
MEDIUM TERM NOTES
TERMS AGREEMENT
___________, ____
HSBC Americas, Inc.
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention:
Re: Distribution Agreement dated as of August 21, 1998
(the "Distribution Agreement")
The undersigned agrees to purchase your Medium-Term
Notes, Series __- ___ having the following terms:
Principal (or face) Amount: $___________
Original Issue Date:
Settlement Date and Time:
Stated Maturity Date:
Final Maturity Date:
Purchase Price: __% of Principal Amount, plus accrued
interest, if any, from Settlement Date
Price to Public: __% of Principal Amount, plus accrued
interest, if any, from Settlement Date
32
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction:
Repayment Date (Dates):
Repayment Price:
Total Amount of OID:
Original Yield to Maturity
Initial accrual period of OID:
Applicability of modified payment upon acceleration:
If yes, state issue price:
Extendible:
Renewable:
Calculation Agent:
Other terms of Notes:
Provisions relating to underwriter default, if any:
(For Fixed Rate Notes)
Interest Rate:
(For Floating Rate Notes)
Base Rate:
Initial Interest Rate:
33
Index Maturity:
Index Maturity for Initial Interest Rate (if
different):
Index Maturity for Final Interest Payment Period (if
different):
Interest Reset Period:
Interest Payment Period:
Spread: _________ points (+/-)
Spread Multiplier: ________%
Maximum Interest Rate: ___%
Minimum Interest Rate: ___%
Interest Payment Dates:
Interest Rate Reset Dates:
Interest Rate Reset Period:
Interest Determination Dates:
The provisions of the Distribution Agreement are
incorporated by reference herein and shall be deemed to have the
same force and effect as if set forth in full herein.
This Agreement is subject to termination in our
absolute discretion on the terms incorporated by reference
herein. If this Agreement is so terminated, the provisions set
forth in Section 10(c) of the Distribution Agreement shall
survive for the purpose of this Agreement.
The following opinions, certificates, comfort letters
and documents referred to in Sections 4(c), 6(b), 6(c) and 6(d)
will be required:
[NAME OF AGENT]
By:
Name:
Title:
34
Accepted:
HSBC Americas, Inc.
By:
Name:
Title:
35
EXHIBIT E
[Date]
[Name and Address of Agent]
Re: Issuance of $_________________ Medium Term Senior Notes,
Series __-__, by HSBC Americas, Inc.
Dear __________:
The Distribution Agreement dated August 21, 1998 (the
"Agreement"), among HSBC Americas, Inc. (the "Company") and the
Agents named therein, provides for the issue and sale by the
Company of its Medium Term Senior Notes, Series __-__.
Subject to and in accordance with the terms of the Agreement and
accompanying Administrative Procedures, the Company hereby
appoints you as Agent (as such term is defined in the Agreement)
in connection with the purchase of the notes as described in the
accompanying Pricing Supplement No. ___, dated ___________,
_____, (the "Notes") but only for this one reverse inquiry
transaction. Your appointment is made subject to the terms and
conditions applicable to Agents under the Agreement and
terminates upon payment for the Notes or other termination of
this transaction. Accompanying this letter is a copy of the
Agreement, the provisions of which are incorporated herein by
reference. Copies of the officer's certificate, opinions of
counsel, and auditors' letter described in the Agreement are not
enclosed but are available upon your request.
This letter agreement, like the Agreement, is governed by and
construed in accordance with the laws of the State of New York.
If the above is in accordance with your understanding of our
agreement, please sign and return this letter to us on or before
settlement date. This action will confirm your appointment and
your acceptance and agreement to act as Agent in connection with
the issue and sale of the above described Notes under the terms
and conditions of the Agreement.
Very truly yours,
AGREED AND ACCEPTED
HSBC AMERICAS, INC. [Name of Agent]
36
By:____________________ By:_____________________
Name:__________________ Name:___________________
Title:_________________ Title:__________________
37
