Exhibit 1.3
TEXTRON FINANCIAL CANADA FUNDING CORP.
Up to $2,600,000,000
Medium-Term Notes, Series E-CAD
Due 9 months or more from the Date of Issue
Fully and Unconditionally Guaranteed
by
TEXTRON FINANCIAL CORPORATION
DISTRIBUTION AGREEMENT
As of November , 2001
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
Banc of America Securities LLC
Banc One Capital Markets, Inc.
Barclays Capital Inc.
Credit Suisse First Boston Corporation
Deutsche Bank ▇▇▇▇. ▇▇▇▇▇ Inc.
First Union Securities, Inc.
Fleet Securities, Inc.
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
UBS Warburg LLC
Ladies and Gentlemen:
Textron Financial Canada Funding Corp., an unlimited liability
company duly organized under the laws of the Province of Nova Scotia (the
"Company"), confirms its agreement with each of you (individually, an "Agent",
and collectively, the "Agents") with respect to the issue and sale by the
Company of up to $2,600,000,000 aggregate principal amount of its Medium-Term
Notes, Series E-CAD, due 9 months or more from the date of issue (the "Notes").
The Notes will be fully and unconditionally guaranteed as to payment of
principal, premium, if any, and interest, by Textron Financial Corporation, a
Delaware corporation (the "Guarantor").
The Notes will be issued under an Indenture dated as of
November , 2001 (the "Indenture"), among the Company, the Guarantor and
SunTrust Bank, as trustee (the "Trustee"). The Company has authorized the
issuance of Notes to and through the Agents pursuant to the terms of this
Agreement. The Notes will be issued in registered form. Each Note will be
represented by either a single global security in registered form without
coupons delivered to the Trustee as agent for The Depository Trust Company
("DTC") and recorded in the book-entry system maintained by DTC or, if otherwise
provided in an applicable supplement to the Prospectus (as defined below), by a
certificate delivered to the holder thereof or a person designated by such
holder.
Subject to the terms and conditions stated herein and subject
to the reservation of the right of the Company to sell Notes directly to
investors on its own behalf and further subject to the understanding that
nothing in this Agreement shall impair or restrict (a) the Company's right to
sell securities with terms similar or identical to any Note independently of the
continuous offering of Notes contemplated by this Agreement, or (b) other than
as set forth in Section 2(a), the ability of the Company and the Guarantor to
enter into additional Distribution Agreements (without any Agent's consent) for
the purpose of appointing additional agents to solicit offers to purchase Notes
(which Distribution Agreements shall otherwise contain terms and provisions
substantially identical to this Agreement), the Company and the Guarantor hereby
appoint the Agents as agents for the purpose of soliciting offers to purchase
Notes from the Company by others. In addition, an Agent may also purchase Notes
as principal for resale to others and, if the Company determines to sell Notes
directly to an Agent and if requested by such Agent, the Company and the
Guarantor will enter into a Terms Agreement relating to such sale (a "Terms
Agreement") in accordance with the provisions of Section 2(b).
The Company and the Guarantor have filed with the Securities
and Exchange Commission (the "Commission") a registration statement on Form S-3
(No. 333-72676), including a prospectus, relating to the Notes and the guarantee
(the "Guarantee") thereof by the Guarantor. Such registration statement,
including the exhibits thereto, as amended by Amendment No. 1 thereto, is
hereinafter referred to as the "Registration Statement;" provided, however, that
if the Company and the Guarantor file a registration statement with the
Commission pursuant to Rule 462(b) of the rules and regulations promulgated
under the Securities Act (the "Rule 462(b) Registration Statement") then, after
such filing, all references to the "Registration Statement" shall also be deemed
to include the Rule 462(b) Registration Statement. The Company and the Guarantor
propose to file with the Commission from time to time, pursuant to Rule 424(b)
under the Securities Act of 1933, as amended (the "Securities Act"), supplements
to the prospectus included in the Registration Statement that will describe
certain terms of the Notes. The prospectus in the form in which it appears in
the Registration Statement is hereinafter referred to as the "Basic Prospectus".
The term "Prospectus" means the Basic Prospectus together with the prospectus
supplement or supplements (each a "Prospectus Supplement") as well as any
Pricing Supplement (as defined herein) relating to the Notes specifically
relating to the Notes, as filed with, or transmitted for filing to, the
Commission pursuant to Rule 424(b). As used herein, the terms "Registration
Statement", "Basic Prospectus", "Prospectus" and "Prospectus Supplement" shall
include in each case the documents, if any, incorporated by reference therein.
The terms "supplement" and "amendment" or "amend" as used herein shall include
all documents filed by the Guarantor pursuant to the Securities Exchange Act of
1934, as amended (the "Exchange Act"), subsequent to the date of the Basic
Prospectus that are deemed to be incorporated by reference in the Prospectus.
Notwithstanding anything to the contrary above in this paragraph, the Company
and the Guarantor shall have the right at any time and from time to time to
substitute for the Registration Statement one or more other registration
statements (each a "Substitute Registration Statement") relating to the Notes
and the offering and sale thereof from time to time in accordance with Rule 415
under the Securities Act, by written notification of such substitution to each
of the Agents and the Trustee. From and after the date of such notification,
such Substitute Registration Statements shall become the Registration Statement
as defined in this paragraph and as used for all purposes throughout this
Agreement.
1. Representations and Warranties. The Company and the
Guarantor jointly and severally represent and warrant to each Agent as of the
Commencement Date (as hereinafter defined), as of each date on which the Company
accepts an offer to purchase Notes, as of each date the Company delivers Notes
and as of each date the Registration Statement, the Basic Prospectus or the
Prospectus is amended or supplemented (each of the times referenced above being
referred to herein as a
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"Representation Date"), as follows (it being understood that such
representations and warranties shall be deemed to relate to the Registration
Statement, the Basic Prospectus and the Prospectus, each as amended and
supplemented to each such date):
(a) The Company and the Guarantor each meet the requirements
for use of Form S-3 under the Securities Act; the Registration Statement (or any
Rule 462(b) Registration Statement) has become effective under the Securities
Act and no stop order suspending the effectiveness of the Registration Statement
(or any Rule 462(b) Registration Statement) has been issued under the Securities
Act and no proceedings for that purpose have been instituted or are pending or,
to the knowledge of the Company or the Guarantor, are contemplated by the
Commission, and any request on the part of the Commission for additional
information has been complied with; the Indenture has been duly qualified under
the Trust Indenture Act of 1939 (the "Trust Indenture Act"); at the respective
times that the Registration Statement (including any Rule 462(b) Registration
Statement) and any post-effective amendment thereto (including the filing of the
Guarantor's most recent annual report on Form 10-K with the Commission) became
effective and at each Representation Date, the Registration Statement (including
any Rule 462(b) Registration Statement) and any amendments thereto complied and
will comply in all material respects with the requirements of the Securities
Act, the Trust Indenture Act and the respective rules and regulations of the
Commission thereunder and did not and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; each preliminary
prospectus and Prospectus filed as part of the Registration Statement as
originally filed or as part of any amendment thereto, or filed pursuant to Rule
424 under the Securities Act, complied when so filed in all material respects
with the rules and regulations promulgated under the Securities Act; each
preliminary prospectus and the Prospectus delivered to the applicable Agent(s)
for use in connection with the offering of Notes are identical to any
electronically transmitted copies thereof filed with the Commission pursuant to
its Electronic Data Gathering, Analysis and Retrieval system ("▇▇▇▇▇"), except
to the extent permitted by Regulation S-T promulgated under the Securities Act
("Regulation S-T"); and at the date hereof, at the date of the Prospectus and
each amendment or supplement thereto and at each Representation Date, neither
the Prospectus nor any amendment or supplement thereto included or will include
an untrue statement of a material fact or omitted or will omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided, however,
that the representations and warranties in this subsection shall not apply to
(i) that part of the Registration Statement which shall constitute the Statement
of Eligibility and Qualification under the Trust Indenture Act or (ii)
statements in or omissions from the Registration Statement or the Prospectus
made in reliance upon and in conformity with information furnished to the
Company and the Guarantor in writing by the Agents expressly for use in the
Registration Statement or the Prospectus.
(b) The consolidated financial statements included in the
Registration Statement and the Prospectus, together with the related schedules
and notes, satisfy the requirements of the Securities Act and the rules and
regulations promulgated thereunder in respect of each of the Company and the
Guarantor.
(c) There has not been any material adverse change in the
condition, financial or otherwise, or in the earnings, business or operations of
either of the Company or the Guarantor and their respective subsidiaries taken
as a whole from that set forth in the Prospectus and the documents incorporated
by reference therein.
(d) The execution and delivery of, and the performance by each
of the Company and the Guarantor of its obligations under, this Agreement have
been duly authorized by the Company and
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the Guarantor, and this Agreement has been duly executed and delivered by the
Company and the Guarantor.
(e) The Indenture has been duly authorized, executed and
delivered by each of the Company and the Guarantor and constitutes a valid and
binding agreement of each of the Company and the Guarantor enforceable in
accordance with its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency or other similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity.
(f) The Support Agreement, dated May 25, 1994 between the
Guarantor and Textron Inc., a Delaware corporation ("Textron") (the "Support
Agreement"), has been duly authorized, executed and delivered by the Guarantor
and constitutes a valid and binding agreement of the Guarantor enforceable in
accordance with its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency or other similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity.
(g) Immediately after any sale of Notes by the Company
hereunder or under any Terms Agreement, the aggregate amount of Notes that shall
have been issued and sold pursuant to the Registration Statement will not exceed
the amount of debt securities registered under the Registration Statement.
(h) The Notes have been duly authorized by the Company for
offer, sale, issuance and delivery pursuant to this Agreement and, when executed
by the Company, authenticated by the Trustee and issued in accordance with the
Indenture and delivered pursuant to the provisions of this Agreement and any
Terms Agreement against payment thereof, will constitute valid and legally
binding obligations of the Company entitled to the benefits of the Indenture and
enforceable against the Company in accordance with their terms, except as
enforceability thereof may be limited by bankruptcy, insolvency or other similar
laws affecting the enforcement of creditors' rights generally and by general
principles of equity and except as rights of acceleration and the availability
of equitable remedies may be limited by equitable principles of general
applicability and except further as enforcement thereof may be limited by (x)
requirements that a claim with respect to any Notes denominated other than in
U.S. dollars (or a foreign currency or currency unit judgment in respect of such
claim) be converted into U.S. dollars at a rate of exchange prevailing on a date
determined pursuant to applicable law or (y) governmental authority to limit,
delay or prohibit the making of payments outside the United States.
(i) The Guarantee has been duly authorized by the Guarantor
for offer, sale, issuance and delivery pursuant to this Agreement and, when
executed by the Guarantor and issued in accordance with the Indenture and
delivered pursuant to the provisions of this Agreement and any Terms Agreement,
will constitute a valid and legally binding obligation of the Guarantor entitled
to the benefits of the Indenture and enforceable against the Guarantor in
accordance with its terms, except as enforceability thereof may be limited by
bankruptcy, insolvency or other similar laws affecting the enforcement of
creditors' rights generally and by general principles of equity and except
further as enforcement thereof may be limited by (x) requirements that a claim
with respect to the Guarantee in respect of Notes denominated other than in U.S.
dollars (or a foreign currency or currency unit judgment in respect of such
claim) be converted into U.S. dollars at a rate of exchange prevailing on a date
determined pursuant to applicable law or (y) governmental authority to limit,
delay or prohibit the making of payments outside the United States.
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(j) The Company is an unlimited liability company duly
organized and validly existing in good standing under the laws of the Province
of Nova Scotia, Canada with full corporate power and authority to own, lease and
operate its properties and to conduct its business, and is duly registered and
qualified to conduct its business and is in good standing in each jurisdiction
or place where the nature of its properties or the conduct of its business
requires such registration or qualification, except where the failure so to
register or qualify does not have a material adverse effect on the condition
(financial or other), business, properties, net worth or results of operations
of the Company and its subsidiaries taken as a whole.
(k) The Guarantor is a corporation duly organized and validly
existing in good standing under the laws of the State of Delaware with full
corporate power and authority to own, lease and operate its properties and to
conduct its business as described in the Registration Statement and the
Prospectus, and is duly registered and qualified to conduct its business and is
in good standing in each jurisdiction or place where the nature of its
properties or the conduct of its business requires such registration or
qualification, except where the failure so to register or qualify does not have
a material adverse effect on the condition (financial or other), business,
properties, net worth or results of operations of the Guarantor and its
subsidiaries taken as a whole.
(l) Each of Cessna Finance Corporation, Litchfield Financial
Corporation, RFC Capital Corporation, Systran Financial Services Holding Company
and Textron Business Credit, Inc. (collectively, the "Guarantor Significant
Subsidiaries") is a corporation duly organized, validly existing and in good
standing in the jurisdiction of its incorporation, with full corporate power and
authority to own, lease and operate its properties and to conduct its business
as described in the Registration Statement and the Prospectus, and is duly
registered and qualified to conduct its business and is in good standing in each
jurisdiction or place where the nature of its properties or the conduct of its
business requires such registration or qualification, except where the failure
so to register or qualify does not have a material adverse effect on the
condition (financial or other), business, properties, net worth or results of
operations of the Guarantor and its subsidiaries taken as a whole. The Guarantor
owns of record, directly or indirectly, all of the outstanding shares of common
stock of each of the Guarantor Significant Subsidiaries (with the exception of
Textron Business Credit, Inc., as to which the Guarantor owns over 99% of the
issued and outstanding common stock) free and clear of any lien, adverse claim,
security interest, equity or other encumbrance.
(m) Each significant subsidiary (as such term is defined for
purposes of Regulation S-X under the Securities Act) of the Company (each, a
"Company Significant Subsidiary") is a corporation duly organized, validly
existing and in good standing in the jurisdiction of its incorporation, with
full corporate power and authority to own, lease and operate its properties and
to conduct its business, and is duly registered and qualified to conduct its
business and is in good standing in each jurisdiction or place where the nature
of its properties or the conduct of its business requires such registration or
qualification, except, in each case, where the failure so to register or qualify
does not have a material adverse effect on the condition (financial or other),
business, properties, net worth or results of operations of the Company and its
subsidiaries taken as a whole. The Company owns of record, directly or
indirectly, all of the outstanding shares of common stock of each of the Company
Significant Subsidiaries free and clear of any lien, adverse claim, security
interest, equity or other encumbrance.
(n) The execution and delivery of this Agreement, any Terms
Agreement, the Indenture and any other agreement or instrument entered into by
the Company or the Guarantor in connection with the transactions contemplated by
the Prospectus and the consummation of the transactions contemplated herein and
therein will not contravene any provision of applicable law, the Memorandum and
Articles of Association or By-Laws of the Company, or the Certificate of
Incorporation or By-Laws of the Guarantor or any other agreement or instrument
binding upon the
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Company or the Guarantor or any Guarantor Significant Subsidiary or any
judgment, order or decree of any governmental body, agency or court having
jurisdiction over the Company or the Guarantor or such Guarantor Significant
Subsidiaries, except such contraventions as would not, individually or in the
aggregate, have a material adverse effect on the condition (financial or
otherwise), business, properties, net worth or results of operations of the
Company and its subsidiaries taken as a whole and of the Guarantor and its
subsidiaries taken as a whole and no consent, approval or authorization or order
of, or qualification with, any governmental body or agency is required for the
performance by each of the Company and the Guarantor of its obligations under
this Agreement, any Terms Agreement, the Indenture or any other agreement or
instrument entered into by the Company and the Guarantor in connection with the
transactions contemplated by the Prospectus, or the consummation of the
transactions contemplated hereby, except such as are required pursuant to state
securities or Blue Sky Laws.
(o) Neither the Company nor the Guarantor is and, after giving
effect to the offering and sale of the Notes and the Guarantees thereof, neither
will be an "investment company" within the meaning of the Investment Company Act
of 1940, as amended (the "Investment Company Act").
(p) The statements included under the caption "Legal
Proceedings" in the Guarantor's most recently filed annual report on Form 10-K,
as supplemented by any current reports on Form 8-K filed in the fiscal year
immediately following the fiscal year to which such annual report relates and/or
its most recent quarterly report on Form 10-Q, filed pursuant to the Exchange
Act, insofar as they describe statements of law or legal conclusions are
accurate and fairly present the information required to be shown.
(q) The Support Agreement has not been amended since the date
thereof and remains in full force and effect.
2. Solicitations as Agent: Purchases as Principal.
(a) On the basis of the representations and warranties herein
contained, but subject to the terms and conditions herein set forth, each Agent
agrees, severally and not jointly, to use its reasonable best efforts to solicit
offers to purchase Notes upon terms acceptable to the Company at such times and
in such amounts as the Company shall from time to time specify. So long as this
Agreement shall remain in effect with respect to any Agent, neither the Company
nor the Guarantor shall, without the consent of such Agent, solicit or accept
offers to purchase, or sell, any debt securities with a maturity at the time of
original issuance of 9 months or more except pursuant to this Agreement, any
Terms Agreement, or except pursuant to a private placement not constituting a
public offering under the Securities Act or except in connection with a firm
commitment underwriting pursuant to an underwriting agreement that does not
provide for a continuous offering of medium-term debt securities or pursuant to
the Distribution Agreement, dated June 28, 2000, between the Guarantor and the
Agents, as amended; provided, that, if, from time to time the Company is
approached by a prospective agent offering to solicit a specific purchase of
Notes, the Company and/or the Guarantor may engage such agent with respect to
such specific purchase, provided that (i) such agent is engaged on terms
substantially similar (including the same commission schedule) to the applicable
terms of this Agreement and (ii) the Agents are given notice of such proposed
purchase within five days after the consummation of such purchase. These
provisions shall not limit Section 3(f) hereof or any similar provision included
in any Terms Agreement.
The Company and the Guarantor reserve the right, in their sole
discretion, to instruct any or all of the Agents to suspend at any time, for any
period of time or permanently, the solicitation of
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offers to purchase Notes. Upon receipt of notice from the Company or the
Guarantor, each Agent will forthwith suspend solicitations of offers to purchase
Notes from the Company until such time as the Company and the Guarantor has
advised the Agents that such solicitation may be resumed. During the period of
time that such solicitation is suspended, neither the Company nor the Guarantor
shall be required to deliver any certificates, opinions or letters in accordance
with Sections 5(b), 5(c) and 5(d); provided, however, that if any of the events
described in Section 5(b), 5(c) or 5(d) shall have occurred during the period of
suspension, no Agent shall be required to resume soliciting offers to purchase
Notes until the Company and the Guarantor have delivered such certificates,
opinions and letters as such Agent may reasonably request.
The Company agrees to pay to each Agent, as consideration for
the sale of each Note and receipt of payment therefor resulting from a
solicitation made by such Agent, a commission in the form of a discount from the
purchase price of such Note equal to the following percentage of the purchase
price of such Note:
Term Commission Rate
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 30 years .750%
It is understood that no commission will be payable with
respect to any offer to purchase Notes accepted by the Company unless and until
the sale of such Notes is consummated.
Each Agent is authorized to solicit offers to purchase Notes
only in the principal amount of $1,000 or any amount in excess thereof which is
an integral multiple of $1,000. The Company shall have the sole right to accept
offers to purchase Notes and may reject any offer in whole or in part. Each
Agent shall have the right to reject any offer to purchase Notes that such Agent
reasonably considers to be unacceptable, and any such rejection shall not be
deemed a breach of such Agent's agreements contained herein. "Reasonable" with
respect to an offer shall be determined by such Agent by reference to
then-prevailing interest rates and the interest rates then specified by the
Company with respect to offers to sell particular Notes.
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(b) If requested by an Agent in connection with a sale of
Notes directly to such Agent as principal for resale to others, the Company and
the Guarantor will enter into a separate Terms Agreement reasonably satisfactory
to the Company and the Guarantor and such Agent that will provide for the sale
of such Notes to, and the purchase and reoffering thereof by, such Agent in
accordance with the terms of this Agreement and the Terms Agreement. Each Terms
Agreement shall be substantially in the form of Exhibit A hereto but may take
the form of an exchange of any standard form of written telecommunication
between such Agent and the Company and the Guarantor or may be an oral agreement
confirmed in writing (including by a facsimile transmission). An Agent's
commitment to purchase Notes as principal shall be deemed to have been made on
the basis of the representations and warranties of the Company and the Guarantor
herein contained and shall be subject to the terms and conditions herein set
forth. Each agreement by an Agent to purchase Notes as principal (whether or not
set forth in a Terms Agreement) shall specify the principal amount of Notes to
be purchased by such Agent pursuant thereto, the maturity date thereof, the
price to be paid to the Company for such Notes and the time and place of
delivery of and payment for such Notes (each such date, a "Settlement Date") and
the requirements for the opinions, officer's certificate and comfort letter
pursuant to Sections 4(c), (d), (e) and (f) hereof.
Unless otherwise agreed to between the Company and the
Guarantor and such Agent in a Terms Agreement, any Note sold to an Agent (i)
shall be purchased by such Agent at a price equal to 100% of the principal
amount thereof less a percentage equal to the commission applicable to an agency
sale of a Note of identical maturity and (ii) may be resold by such Agent at
varying prices from time to time or, if set forth in the applicable Terms
Agreement, at a fixed public offering price. In connection with any resale of
Notes purchased, an Agent may use a selling or dealer group and may reallow to
any broker or dealer any portion of the discount or commission payable pursuant
hereto.
If the Company and the Guarantor and two or more Agents enter
into an agreement pursuant to which such Agents agree to purchase Notes from the
Company as principal and one or more of such Agents shall fail at the Settlement
Date to purchase the Notes which it or they are obligated to purchase (the
"Defaulted Notes"), then the nondefaulting Agents shall have the right, within
24 hours thereafter, to make arrangements for one of them or one or more other
Agents or underwriters to purchase all, but not less than all, of the Defaulted
Notes in such amounts as may be agreed upon and upon the terms herein set forth;
provided, however, that if such arrangements shall not have been completed
within such 24-hour period, then:
(i) if the aggregate principal amount of Defaulted Notes does
not exceed 10% of the aggregate principal amount of Notes to be so
purchased by all of such Agents on the Settlement Date, the
nondefaulting Agents shall be obligated, severally and not jointly, to
purchase the full amount thereof in the proportions that their
respective initial underwriting obligations bear to the underwriting
obligations of all nondefaulting Agents; or
(ii) if the aggregate principal amount of Defaulted Notes
exceeds 10% of the aggregate principal amount of Notes to be so
purchased by all of such Agents on the Settlement Date, such agreement
shall terminate without liability on the part of any nondefaulting
Agent.
No action taken pursuant to this paragraph shall relieve any defaulting Agent
from liability in respect of its default. In the event of any such default which
does not result in a termination of such agreement,
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either the nondefaulting Agents or the Company and the Guarantor shall have the
right to postpone the Settlement Date for a period not exceeding seven days in
order to effect any required changes.
(c) The purchase price, interest rate or formula, maturity
date and other terms of the Notes specified in Exhibit A hereto (as applicable)
shall be agreed upon between the Company and the Guarantor and the applicable
Agents and specified in a pricing supplement to the Prospectus (each, a "Pricing
Supplement") to be prepared by the Company in connection with each sale of
Notes. Each Agent and the Company agree to perform the respective duties and
obligations specifically provided to be performed in the Medium-Term Notes,
Series E-CAD Administrative Procedures (attached hereto as Exhibit B) (the
"Procedures"), as amended from time to time. The Procedures may be amended only
by written agreement of the Company and each Agent and, in the case of
amendments which affect the respective rights, duties or obligations of the
Trustee or the Guarantor, with the written agreement of the Trustee or the
Guarantor, as the case may be. To the extent the Procedures in effect from time
to time conflict with any provision of this Agreement, the provisions of this
Agreement shall govern. The Company will furnish a copy of the Procedures from
time to time in effect to the Trustee.
(d) The documents required to be delivered by Section 4 of
this Agreement shall be delivered at the office of ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP,
counsel to the Company and the Guarantor, not later than 2:00 P.M., New York
City time, on the date hereof (the "Commencement Date"), or at such other time
and/or place as you and the Company may agree upon in writing.
(e) [INTENTIONALLY OMITTED]
(f) Each Agent represents that it is a broker-dealer
registered under the Exchange Act.
(g) In soliciting purchases of the Notes from the Company on
an agency basis, each Agent is acting solely as an agent for the Company and not
as principal. Each such Agent will communicate to the Company, orally, each
offer for the purchase of Notes solicited by it on an agency basis other than
those offers rejected by such Agent. Such Agent shall have the right, in its
discretion reasonably exercised, to reject any offer for the purchase of Notes,
in whole or in part, and any such rejection shall not be deemed a breach of its
agreement contained herein. Each Agent will make reasonable efforts to assist
the Company in obtaining performance by each purchaser whose offer to purchase
Notes from the Company has been solicited by it and accepted by the Company but
each Agent shall not have any liability to the Company in the event any such
purchase is not consummated for any reason. If the Company shall default on its
obligation to deliver Notes to a purchaser whose offer has been solicited by
such Agent on an agency basis and accepted by the Company, the Company shall (i)
hold such Agent harmless against any loss, claim or damage arising from or as a
result of such default by the Company and (ii) pay to such Agent any commission
to which it would otherwise be entitled absent such default.
(h) The Company shall not sell or approve the solicitation of
offers for the purchase of Notes in excess of the amount which shall be
authorized by the Company from time to time or in excess of the aggregate
initial offering price of Notes registered pursuant to the Registration
Statement. The Agents shall have no responsibility for maintaining a record with
respect to the aggregate initial offering price of Notes sold, or of otherwise
monitoring the availability of Notes for sale, under the Registration Statement.
3. Agreements. Each of the Company and the Guarantor agrees
with each Agent that:
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(a) The Company and the Guarantor will promptly notify such
Agent of (i) the filing of any amendment or supplement to the Prospectus, other
than filings relating solely to securities other than the Notes or solely
establishing the terms of particular Notes to be sold pursuant hereto, (ii) the
filing and effectiveness of any amendment to the Registration Statement, other
than filings relating solely to securities other than the Notes, (iii) any
request by the Commission for any amendment of the Registration Statement or any
amendment of or supplement to the Prospectus or for any additional information,
other than any request relating solely to securities other than the Notes, (iv)
the issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or the institution or threatening of any proceeding
for that purpose and (v) the receipt by the Company or the Guarantor of any
notification with respect to the suspension of the qualification of the Notes
for sale in any jurisdiction or the initiation or threatening of any proceeding
for such purpose. The Company and the Guarantor will use reasonable efforts to
prevent the issuance of any such stop order or notice of suspension of
qualification and, if issued, to obtain as soon as possible the withdrawal
thereof.
(b) If, at any time when a prospectus relating to the Notes is
required to be delivered under the Securities Act, any event occurs or condition
exists as a result of which, in the opinion of counsel to the Agents, the
Registration Statement or the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein, in the light of the circumstances
when the Prospectus, as then amended or supplemented, is delivered to a
purchaser, not misleading, or if, in such Agent's reasonable opinion or in the
opinion of counsel to the Company and the Guarantor or the Agents, it is
necessary at any time to amend or supplement the Registration Statement or the
Prospectus, as then amended or supplemented, to comply with law, the Company or
the Guarantor will promptly notify the Agents by telephone (with confirmation in
writing) to suspend solicitation of offers to purchase Notes and, if so notified
by the Company or the Guarantor, such Agent shall forthwith suspend such
solicitation and cease using the Prospectus as then amended or supplemented and
cease sales of any Notes such Agent may own as principal. If the Company and the
Guarantor shall decide to amend or supplement the Registration Statement or
Prospectus as then amended or supplemented, it shall so advise such Agent
promptly by telephone (with confirmation in writing) and, at its expense, shall
prepare and cause to be filed promptly with the Commission an amendment or
supplement to the Registration Statement or Prospectus as then amended or
supplemented that will correct such statement or omission or effect such
compliance and will supply such amended or supplemented Prospectus to such Agent
in such quantities as such Agent may reasonably request. If such amendment or
supplement and any documents, certificates, opinions and letters furnished to
such Agent pursuant to Sections 5(b), 5(c) and 5(d) in connection with the
preparation and filing of such amendment or supplement are satisfactory in all
respects to such Agent, upon the filing of such amendment or supplement with the
Commission or effectiveness of an amendment to the Registration Statement, such
Agent will resume the solicitation of offers to purchase Notes hereunder.
Notwithstanding any other provision of this Section 3(b), until the distribution
of any Notes any Agent may own as principal has been completed, if any event
described above in this paragraph (b) occurs, the Company and the Guarantor
will, at their own expense, forthwith prepare and cause to be filed promptly
with the Commission an amendment or supplement to the Registration Statement or
Prospectus as then amended or supplemented, reasonably satisfactory to such
Agent, and will supply such amended or supplemented Prospectus to such Agent in
such quantities as such Agent may reasonably request. If such amendment or
supplement and any documents, certificates, opinions and letters furnished to
such Agent pursuant to Sections 5(b), 5(c) and 5(d) in connection with the
preparation and filing of such amendment or supplement are reasonably
satisfactory to such Agent, upon the filing of such amendment or supplement with
the Commission or effectiveness of an amendment to the Registration Statement,
such Agent may resume its resale of Notes as principal.
10
(c) The Guarantor will make generally available to its
security holders and to such Agent as soon as practicable earnings statements
that satisfy the provisions of Section 11(a) of the Securities Act and the rules
and regulations thereunder (including, at the option of the Guarantor, Rule 158)
covering twelve month periods beginning after the "effective date" (as defined
in Rule 158 under the Securities Act) of the Registration Statement with respect
to each sale of Notes. It is understood by the parties hereto that if the
Guarantor provides the information required by Section 11(a) under the
Securities Act pursuant to Rule 158 thereunder, the foregoing sentence would not
require any filing or other action by the Guarantor other than its periodic
filings on Form 10-K and Form 10-Q.
(d) The Guarantor will furnish to such Agent, promptly after
the filing thereof with the Commission, copies of its annual report on Form 10-K
(including the audited financial statements of the Guarantor for the preceding
fiscal year), its quarterly reports on Form 10-Q with respect to each of the
first three quarters of any fiscal year and its reports on Form 8-K (other than
reports relating solely to securities other than the Notes); provided, however,
that if on the date of such filing any Agent shall have suspended solicitation
of purchases of the Notes in its capacity as agent pursuant to a request from
the Company or the Guarantor, and if such Agent shall not hold any Notes as
principal purchased pursuant to a Terms Agreement, the Guarantor shall not be
obligated to furnish copies of such reports to such Agent until such time as the
Company and the Guarantor shall determine that solicitation of purchases of the
Notes should be resumed by such Agent or shall subsequently enter into a new
Terms Agreement with such Agent.
(e) Each of the Company and the Guarantor will use its
reasonable efforts to qualify the Notes for offer and sale under the securities
or blue sky laws of such jurisdictions as such Agent shall reasonably request
and will maintain such qualifications for as long as may be required for the
distribution of the Notes; provided, however, that neither the Company nor the
Guarantor shall be obligated to file any consent to service of process or to
qualify as a foreign corporation in any jurisdiction in which it is not so
qualified.
(f) Neither the Company nor the Guarantor will, from the date
of any Terms Agreement with such Agent or other agreement by such Agent to
purchase Notes as principal and continuing to and including the later of (i) the
termination of the trading restrictions for the Notes purchased thereunder, as
notified to the Company and the Guarantor by such Agent and (ii) the related
Settlement Date, offer, sell, contract to sell, issue, grant any option for the
sale of or otherwise dispose of any debt securities of either of the Company or
the Guarantor which both mature 9 months or more after such Settlement Date and
are substantially similar to the Notes, without the prior written consent of
such Agent.
(g) The Company and the Guarantor will promptly notify the
Agents in writing of any downgrading or of its receipt of any notice of any
intended or potential downgrading or of any review for possible change in the
rating accorded any of the Company's or the Guarantor's securities by any
"nationally recognized statistical rating organization," as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act; provided, however, that
if on the date of such downgrading or such review or receipt of such notice, any
Agent shall have suspended solicitation of purchases of the Notes in its
capacity as agent pursuant to a request from the Company or the Guarantor, and
if such Agent shall not hold any Notes as principal purchased pursuant to a
Terms Agreement, the Company and the Guarantor shall not be obligated to notify
such Agent of such downgrading or such review or receipt of such notice until
such time as the Company and the Guarantor shall determine that solicitation of
purchases of the Notes should be resumed by such Agent or shall subsequently
enter into a new Terms Agreement with such Agent.
11
(h) The Company and the Guarantor will, whether or not any
sale of Notes is consummated, pay all expenses incident to the performance of
its obligations under this Agreement and any Terms Agreement, including: (i) the
preparation and filing of the Registration Statement and the Prospectus and all
amendments and supplements thereto, (ii) the preparation, issuance and delivery
of the Notes, (iii) the fees and disbursements of counsel and accountants of the
Company and the Guarantor and of the Trustee and its counsel, (iv) the
qualification of the Notes under securities or Blue Sky laws in accordance with
the provisions of Section 3(e), 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 Memoranda, (v) the printing and
delivery to such Agent in quantities as hereinabove stated of copies of the
Registration Statement and all amendments thereto, and of the Basic Prospectus
and any amendments or supplements thereto, (vi) the preparation, reproduction
and delivery to such Agent of copies of the Indenture and any Blue Sky
Memoranda, (vii) any fees charged by rating agencies for the rating of the
Notes, (viii) the fees and expenses, if any, incurred with respect to any filing
with the National Association of Securities Dealers, Inc. ("NASD"), (ix) the
reasonable fees and disbursements of counsel for the Agents incurred in
connection with the establishment of the program to which this Agreement relates
and incurred from time to time in connection with the offering and sale of the
Notes, (x) if applicable, the fees and expenses incurred in connection with any
listing of Notes on a securities exchange and (xi) any out-of-pocket expenses
incurred by such Agent with the approval of the Company.
Notwithstanding the foregoing, any advertising relating to the
offer or sale of any Notes or this Agreement undertaken by any Agent will be for
the account of such Agent and will not be paid for or reimbursed by the Company
or the Guarantor. Each of the Agents hereby agrees that no such advertising will
be undertaken by it without the prior oral or written approval thereof by the
Company.
(i) The Company and the Guarantor will deliver to each Agent,
without charge, as many copies of each preliminary prospectus as such Agent may
reasonably request, and the Company and the Guarantor hereby consent to the use
of such copies for purposes permitted by the Securities Act. The Company and the
Guarantor will furnish to each Agent, without charge, such number of copies of
the Prospectus (as amended or supplemented) as such Agent may reasonably
request. The Prospectus and any amendments or supplements thereto furnished to
the Agents will be identical to any electronically transmitted copies thereof
filed with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T.
(j) The Company and the Guarantor will prepare, with respect
to any Notes to be sold to or through one or more Agents pursuant to this
Agreement, a Pricing Supplement with respect to such Notes in a form previously
approved by the Agents. The Company and the Guarantor will deliver such Pricing
Supplement no later than 11:00 a.m., New York City time, on the business day
following the date of the Company's acceptance of the offer for the purchase of
such Notes and will file such Pricing Supplement pursuant to Rule 424(b)(3)
under the 1933 Act not later than the close of business of the Commission on the
fifth business day after the date on which such Pricing Supplement is first
used.
4. Conditions of the Obligations of the Agents. The
obligations of each Agent to solicit offers to purchase Notes as agent of the
Company, the obligations of each Agent to purchase Notes pursuant to any Terms
Agreement or otherwise and the obligations of any other purchaser to purchase
Notes will be subject to the accuracy of the representations and warranties on
the part of the Company and the Guarantor herein, the accuracy of the statements
of officers of the Company and the Guarantor made in each certificate furnished
pursuant to the provisions hereof prior to or concurrently with any such
solicitation or purchase, the performance and observance by the Company and the
12
Guarantor of all covenants and agreements herein contained on its part to be
performed and observed, in each case, at the time of such solicitation or
purchase and to the following additional conditions precedent:
(a) With respect to the obligation of each Agent to solicit
offers to purchase Notes, on or after the date hereof, or on or after the date
of execution of any Terms Agreement obligating such Agent to purchase Notes, or
on or after the date of acceptance by the Company of an offer to purchase Notes,
as applicable, there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading, of a review
indicating possible negative implications or of any review for a possible change
that does not indicate the direction of the possible change, in the rating
accorded any of the securities of the Company, the Guarantor or Textron by any
"nationally recognized statistical rating organization," as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act.
(b) With respect to the obligation of each Agent to solicit
offers to purchase Notes, on or after the date hereof, or on or after the date
of execution of any Terms Agreement obligating such Agent to purchase Notes, or
on or after the date of acceptance by the Company of an offer to purchase Notes,
as applicable, there shall not have occurred any of the following: (i) any
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or prospects or operations of the Company and its
subsidiaries, taken as a whole, or of the Guarantor and its subsidiaries, taken
as a whole, except as set forth in or contemplated by the Prospectus or as set
forth in or contemplated by the Guarantor's most recent annual report on Form
10-K, as supplemented by any current reports on Form 8-K and/or the Guarantor's
most recent quarterly report on Form 10-Q, filed pursuant to the Exchange Act
(excluding, for purposes of this paragraph, any amendments or supplements filed
after the date of any such Terms Agreement), (ii) any material adverse change in
the condition, financial or otherwise, or in the earnings, business affairs or
prospects, or operations of Textron and its subsidiaries, taken as a whole,
except as set forth in or contemplated by its most recent annual report on Form
10-K, as supplemented by any current reports on Form 8-K and/or its most recent
quarterly report on Form 10-Q, filed pursuant to the Exchange Act (excluding,
for purposes of this paragraph, any amendments or supplements filed after the
date of any such Terms Agreement), (iii) trading generally shall have been
suspended or materially limited on or by, as the case may be, any of the New
York Stock Exchange, the American Stock Exchange, the National Association of
Securities Dealers, Inc., the Chicago Board of Options Exchange, the Chicago
Mercantile Exchange or the Chicago Board of Trade or a material disruption has
occurred in securities settlement or clearance services in the United States,
(iv) trading of any securities of the Company or the Guarantor shall have been
suspended on any exchange or in any over-the-counter market, (v) a general
moratorium on commercial banking activities shall have been declared by either
Federal or New York State authorities or a material disruption in commercial
banking activity has occurred, (vi) any outbreak or escalation of hostilities or
any change in financial markets or any calamity or crisis that, in the
reasonable judgment of the Agents, is material and adverse, or (vii) there shall
have come to the attention of such Agent that the Prospectus, at the time it was
required to be delivered to a purchaser of such Notes, included an untrue
statement of a material fact or omitted to state a material fact necessary in
order to make the statements therein, in the light of the circumstances existing
at the time of such delivery, not misleading and, in the case of any of the
events specified in clauses (a) (i) through (vii), such event, in the reasonable
judgment of the Agents, makes it impracticable or inadvisable to proceed with
the solicitation of offers to purchase Notes or the purchase of Notes from the
Company as principal pursuant to the applicable Terms Agreement or otherwise.
(c) On the Commencement Date and, if called for by any
agreement by such Agent to purchase Notes as principal, on the corresponding
Settlement Date, such Agent shall have received:
13
(i) The opinion, dated as of such date, of ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇,
LLP, counsel for the Company and the Guarantor, substantially to the
effect that:
(A) the Indenture has been duly authorized, executed
and delivered by the Guarantor and (assuming that the
Indenture has been duly authorized by the Company) is a valid
and binding agreement of the Company and the Guarantor
enforceable against the Company and the Guarantor in
accordance with its terms (except as (1) the enforceability
thereof may be limited by bankruptcy, insolvency or similar
laws affecting the enforcement of creditors' rights generally
and (2) the availability of equitable remedies may be limited
by equitable principles of general applicability and except
further as enforceability thereof may be limited by (x)
requirements that a claim with respect to any Notes
denominated other than in U.S. dollars (or a foreign currency
or currency unit judgment in respect of such claim) be
converted into U.S. dollars at a rate of exchange prevailing
on a date determined pursuant to applicable law or (y)
governmental authority to limit, delay or prohibit the making
of payments outside the United States) and the Indenture has
been duly qualified under the Trust Indenture Act;
(B) assuming that the Notes have been duly authorized
by the Company for offer, sale, issuance and delivery pursuant
to this Agreement, the Notes, when executed and authenticated
in accordance with the provisions of the Indenture and sold to
any purchaser through any Agent as agent or to any Agent as
principal pursuant to any Terms Agreement, the Notes will
constitute valid and legally binding obligations of the
Company enforceable against the Company in accordance with
their terms and will be entitled to the benefits of the
Indenture, except as (1) enforceability thereof may be limited
by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally and (2) the
availability of equitable remedies may be limited by equitable
principles of general applicability and except further as
enforceability thereof may be limited by (x) requirements that
a claim with respect to any Notes denominated other than in
U.S. dollars (or a foreign currency or currency unit judgment
in respect of such claim) be converted into U.S. dollars at a
rate of exchange prevailing on a date determined pursuant to
applicable law or (y) governmental authority to limit, delay
or prohibit the making of payments outside the United States;
(C) the Guarantee has been duly authorized, executed
and delivered by the Guarantor and is a valid and binding
agreement of the Guarantor enforceable against the Guarantor
in accordance with its terms except as (1) the enforceability
thereof may be limited by bankruptcy, insolvency or similar
laws affecting the enforcement of creditors' rights generally
and (2) the availability of equitable remedies may be limited
by equitable principles of general applicability and except
further as enforceability thereof may be limited by (x)
requirements that a claim with respect to the Guarantee of any
Notes denominated other than in U.S. dollars (or a foreign
currency or currency unit judgment in respect of such claim)
be converted into U.S. dollars at a rate of exchange
prevailing on a date determined pursuant to applicable law or
(y) governmental authority to limit, delay or prohibit the
making of payments outside the United States;
14
(D) the execution and delivery of, and the
performance by the Guarantor of its obligations under, this
Agreement have been duly authorized by the Guarantor and this
Agreement has been duly executed and delivered by the
Guarantor;
(E) the execution and delivery of this Agreement, the
Indenture, the Notes, the Guarantee and, if this opinion is
required by any agreement by an Agent to purchase Notes as
principal, any applicable Terms Agreement by the Company and
the Guarantor and the consummation by each of the Company and
the Guarantor of its obligations herein and therein do not
contravene any provision of applicable law of the State of New
York (except as rights to indemnity and contribution under
this Agreement may be limited by applicable law, regulation or
public policy) or the Certificate of Incorporation or By-Laws
of the Guarantor;
(F) neither the Company nor the Guarantor is and,
immediately after giving effect to the offering and sale of
the Notes, will be an "investment company" within the meaning
of the Investment Company Act;
(G) the statements in the Prospectus under the
heading "Description of the Notes" and "Plan of Distribution",
insofar as such statements constitute a summary of legal
matters, documents or proceedings referred to therein, have
been reviewed by such counsel and are correct in all material
respects; and
(H) such counsel is of the opinion that the
Registration Statement and Prospectus, as amended or
supplemented, if applicable (except as to financial statements
contained therein or omitted therefrom and the notes thereto
and the schedules and other financial data included therein,
as to which such counsel need not express any opinion) comply
as to form in all material respects with the Securities Act
and the rules and regulations thereunder.
(ii) The General Counsel or any Assistant General Counsel of
the Guarantor shall have furnished to the Agents a written opinion,
dated as of such date, substantially to the effect that:
(A) the Guarantor is a corporation duly organized and
validly existing in good standing under the laws of the State
of Delaware and has the corporate power and authority to own,
lease and operate its properties and to conduct its business
as described in the Registration Statement and the Prospectus,
and is duly registered and qualified to conduct its business
and is in good standing in each jurisdiction or place where
the nature of its properties or the conduct of its business
requires such registration or qualification, except where the
failure so to register or qualify does not have a material
adverse effect on the condition (financial or other),
business, properties, net worth or results of operations of
the Guarantor and its subsidiaries taken as a whole;
(B) each Guarantor Significant Subsidiary is a
corporation duly organized, validly existing and in good
standing in the jurisdiction of its incorporation and has the
corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the
Registration
15
Statement and the Prospectus, and is duly registered and
qualified to conduct its business and is in good standing in
each jurisdiction or place where the nature of its properties
or the conduct of its business requires such registration or
qualification, except where the failure so to register or
qualify does not have a material adverse effect on the
condition (financial or other), business, properties, net
worth or results of operations of the Guarantor and its
subsidiaries taken as a whole;
(C) all of the issued and outstanding capital stock
of each Guarantor Significant Subsidiary has been duly
authorized and validly issued and is fully paid and
non-assessable, and the Guarantor owns of record, directly or
indirectly, all of the outstanding shares of common stock of
the Company and each of the Guarantor Significant Subsidiaries
(with the exception of Textron Business Credit, Inc., as to
which the Guarantor owns over 99% of the issued and
outstanding common stock) free and clear of any lien, adverse
claim, security interest, equity or other encumbrance;
(D) the execution and delivery of this Agreement, the
Indenture, the Guarantees and, if this opinion is required by
any agreement by an Agent to purchase Notes as principal, any
applicable Terms Agreement by the Guarantor and the
performance by the Guarantor of its obligations herein and
therein do not contravene any provision of applicable law
(except as rights to indemnity and contribution under this
Agreement may be limited by applicable law, regulation or
public policy) or, to such counsel's knowledge after due
inquiry, any other agreement or instrument binding upon the
Guarantor or any of the Guarantor Significant Subsidiaries or
any judgment, order or decree of any governmental body, agency
or court having jurisdiction over the Guarantor or any
Guarantor Significant Subsidiary, except such contraventions
as would not, individually or in the aggregate, have a
material adverse effect on the condition (financial or
otherwise), business, properties, net worth or results of
operations of the Guarantor and its subsidiaries taken as a
whole, and no consent, approval or authorization or order of,
or qualification with, any governmental body or agency is
required for the performance by the Guarantor of its
obligations under this Agreement, the Indenture or the
Guarantee, and the consummation of the transactions
contemplated thereby, except such as are required pursuant to
state securities or Blue Sky Laws;
(E) the statements included under the caption "Legal
Proceedings" in the Guarantor's annual report on Form 10-K, as
supplemented by any current reports on Form 8-K and/or its
most recent quarterly report on Form 10-Q, filed pursuant to
the Exchange Act, insofar as they describe statements of law
or legal conclusions are accurate and fairly present the
information required to be shown; and
(F) such counsel (1) is of the opinion that each
document filed pursuant to the Exchange Act and incorporated
by reference in the Prospectus (except as to financial
statements contained therein or omitted therefrom and the
notes thereto and the schedules and other financial data
included therein, as to which such counsel need not express
any opinion) complied when so filed as to
16
form in all material respects with such act and the rules and
regulations thereunder, (2) has no reason to believe that
(except for the financial statements contained therein or
omitted therefrom and the notes thereto and the schedules and
other financial data included therein, as to which such
counsel need not express any belief) any part of the
Registration Statement (including the documents incorporated
by reference therein), filed with the Commission pursuant to
the Securities Act, when such part became effective, contained
any 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, (3) is of the
opinion that the Registration Statement and Prospectus, as
amended or supplemented, if applicable (except as to financial
statements contained therein or omitted therefrom and the
notes thereto and the schedules and other financial data
included therein, as to which such counsel need not express
any opinion) comply as to form in all material respects with
the Securities Act and the Trust Indenture Act and the rules
and regulations thereunder and (4) has no reason to believe,
and nothing has come to such counsel's attention that causes
such counsel to believe, that (except for the financial
statements contained therein or omitted therefrom and the
notes thereto and the schedules and other financial data
included therein, as to which counsel need not express any
belief) the Registration Statement, when it became effective,
the Prospectus as of its date and the Prospectus, as amended
or supplemented, if applicable, through the Closing Date
contained or contains any untrue statement of a material fact
or omitted to state a material fact required to be stated
therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made,
not misleading; provided that such counsel may state that such
counsel's opinion and belief is based upon such counsel's
participation in the preparation of the Registration Statement
and the Prospectus and any amendment and supplements thereto
(including the documents incorporated by reference therein)
and review and discussion of the contents thereof (including
the documents incorporated by reference therein), but is
without independent check or verification except as specified.
(iii) The opinion, dated as of such date, of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Stirling Scales, Canadian Counsel to the Company, substantially to the
effect that:
(A) the Company is a corporation duly organized and
validly existing in good standing under the laws of the
Province of Nova Scotia and has the corporate power and
authority to own, lease and operate its properties and to
conduct its business, and is duly registered and qualified to
conduct its business and is in good standing in each
jurisdiction or place where the nature of its properties or
the conduct of its business requires such registration or
qualification, except, in each case, where the failure so to
register or qualify does not have a material adverse effect on
the condition (financial or other), business, properties, net
worth or results of operations of the Company and its
subsidiaries taken as a whole;
(B) To the best of our knowledge, the Company does
not have any significant subsidiaries (as such term is defined
in Rule 1-02 of Regulation S-X promulgated under the
Securities Act);
17
(C) the execution and delivery of this Agreement, the
Indenture and, if this opinion is required by any agreement by
an Agent to purchase Notes as principal, any applicable Terms
Agreement by the Company and the performance by the Company of
its obligations herein and therein do not contravene any
provision of applicable Canadian law or, to such counsel's
knowledge after due inquiry, any other agreement or instrument
binding upon the Company or any judgment, order or decree of
any Canadian governmental body, agency or court having
jurisdiction over the Company, except such contraventions as
would not, individually or in the aggregate, have a material
adverse effect on the condition (financial or otherwise),
business, properties, net worth or results of operations of
the Company and its subsidiaries taken as a whole, and no
consent, approval or authorization or order of, or
qualification with, any Canadian governmental body or agency
is required for the performance by the Company of its
obligations under this Agreement or the Indenture, and the
consummation of the transactions contemplated thereby;
(D) the Indenture has been duly authorized, executed
and delivered by the Company;
(E) the Notes have been duly authorized by the
Company for offer, sale, issuance and delivery pursuant to
this Agreement;
(F) the execution and delivery of, and the
performance by the Company of its obligations under, this
Agreement have been duly authorized by the Company and this
Agreement has been duly executed and delivered by the Company;
(G) the execution and delivery of this Agreement, the
Indenture, the Notes, and, if this opinion is required by any
agreement by an Agent to purchase Notes as principal, any
applicable Terms Agreement by the Company and the consummation
by the Company of its obligations herein and therein do not
contravene any provision of applicable law of Canada or the
Memorandum and Articles of Association or By-Laws of the
Company;
(H) Pursuant to this Agreement, and to the extent
that the laws of the Province of Nova Scotia are relevant, the
Company has legally, validly, effectively and irrevocably
submitted to the jurisdiction of the United States Federal and
New York State courts sitting in the Borough of Manhattan in
The City of New York, State of New York, and has legally,
validly and effectively appointed Corporation Service Company
as the authorized agent of the Company for the purposes
described in Section 12 of this Agreement assuming this to be
the case as a matter of the applicable United States Federal
and New York State laws;
(I) The choice of the laws of the State of New York,
United States of America as the governing law of this
Agreement is a valid and effective choice of law and in an
action brought before a court of competent jurisdiction in the
Province of Nova Scotia, the laws of the State of New York
would, to the extent specifically pleaded and proved as a fact
by expert evidence, be recognized and applied by such court to
all issues concerning the formal and essential validity of
this Agreement and the interpretation thereof; and
18
(J) The courts of the Province of Nova Scotia will
recognize and enforce a foreign judgment of a court of
competent jurisdiction, based on the principle that a judgment
of a competent foreign court imposes upon the judgment debtor
an obligation to pay the sum for which judgment has been given
provided such judgment is final, for a liquidated sum, and was
not obtained in a manner and is not of a kind the enforcement
of which is contrary to the public policy of the Province of
Nova Scotia. For the purposes of enforcement of a judgment
granted against the Company in respect of this Agreement, a
court in the Province of Nova Scotia would recognize the
jurisdiction of the applicable federal or state court to the
jurisdiction of which the Company has submitted rendering such
judgment if service of process on the Company is effected
pursuant to and in accordance with the provisions of this
Agreement.
(iv) The opinion, dated as of such date, of in-house counsel
to Textron, substantially to the effect that:
(A) Textron has been duly incorporated and is validly
existing as a corporation in good standing under the laws of
the State of Delaware and is duly qualified to transact
business and is in good standing in each jurisdiction in which
the conduct of its business or the ownership or leasing of
property requires such qualification and where the failure to
be qualified or in good standing would have a material adverse
effect upon its operations or financial condition;
(B) the Support Agreement has been duly authorized,
executed and delivered by Textron and is a valid and binding
agreement of Textron enforceable against Textron in accordance
with its terms by the parties thereto and by any creditor of
the Guarantor which lends funds to the Guarantor or in respect
of which the Guarantor has a contingent liability (each, a
"Third-Party Beneficiary"), including holders of the Notes
issued by the Company pursuant to this Agreement in respect of
the related Guarantee (but with respect to any Third-Party
Beneficiary only to the extent to which the Guarantor is
indebted to such Third-Party Beneficiary for money borrowed),
except as: (a) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally and (b) the
availability of equitable remedies may be limited by equitable
principles of general applicability; and
(C) the execution, delivery and performance by
Textron of the Support Agreement does not contravene any
provisions of currently applicable law, any current provision
of the Certificate of Incorporation or By-Laws of Textron,
each as of the date of such opinion, or, to the best of such
counsel's knowledge, any current agreement or other instrument
currently binding upon Textron, and no consent, approval or
authorization of any governmental body is required in
connection with the performance of the Support Agreement.
(v) The opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇ LLP, counsel for
the Agents, with respect to the incorporation of the Guarantor, the
enforceability of the Notes, the validity and enforceability of the
Guarantees, the Registration Statement, the Prospectus and such other
related matters as the Agents may reasonably require, and the Company
and the Guarantor shall have furnished to such counsel such documents
as they reasonably request for the purpose of enabling them to pass
upon such matters.
19
(d) The Representatives shall have received certificates,
dated the Commencement Date and, if called for by any agreement by such Agent to
purchase Notes as principal, on the corresponding Settlement Date, of an
executive officer of the Company in which such officer, on behalf of the Company
and to his/her knowledge, shall state that (i) no stop order suspending the
effectiveness of the Registration Statement or of any part thereof has been
issued and no proceedings for such purpose are pending or threatened by the
Commission and that, subsequent to the date of the most recent financial
statements in the Prospectus, there has been no material adverse change in the
condition, financial or otherwise, earnings, business or operations of the
Company and its subsidiaries, taken as a whole, except as set forth in or
contemplated by the Prospectus and (ii) the representations and warranties of
the Company contained in this Agreement are true and correct as of such date.
(e) The Representatives shall have received certificates,
dated the Commencement Date and, if called for by any agreement by such Agent to
purchase Notes as principal, on the corresponding Settlement Date, of an
executive officer of the Guarantor in which such officer, on behalf of the
Guarantor and to his/her knowledge, shall state that (i) no stop order
suspending the effectiveness of the Registration Statement or of any part
thereof has been issued and no proceedings for such purpose are pending or
threatened by the Commission and that, subsequent to the date of the most recent
financial statements in the Prospectus, there has been no material adverse
change in the condition, financial or otherwise, earnings, business or
operations of the Guarantor and its subsidiaries, taken as a whole, except as
set forth in or contemplated by the Prospectus and (ii) the representations and
warranties of the Guarantor contained in this Agreement are true and correct as
of such date.
(f) On the Commencement Date and, if called for by any
agreement by such Agent to purchase Notes as principal, on the corresponding
Settlement Date, Ernst & Young LLP shall have furnished to such Agent a letter
or letters from ▇▇▇▇▇ & Young LLP or another nationally recognized firm of
independent public accountants reasonably satisfactory to the Agents, dated as
of the Commencement Date or such Settlement Date, as the case may be, in form
and substance satisfactory to such Agent containing statements and information
of the type ordinarily included in accountant's "comfort letters" to
underwriters with respect to the financial statements and certain financial
information contained in or incorporated by reference into the Registration
Statement and the Prospectus, as amended or supplemented.
(g) The Registration Statement (including the Rule 462(b)
Registration Statement) has become effective under the Securities Act and no
stop order suspending the effectiveness of the Registration Statement shall have
been issued under the Securities Act and no proceedings for that purpose shall
have been instituted or shall be pending or threatened by the Commission, and
any request on the part of the Commission for additional information shall have
been complied with to the reasonable satisfaction of counsel to the Agents.
(h) On the date hereof, counsel to the Agents shall have been
furnished with such documents and opinions as such counsel may require for the
purpose of enabling such counsel to pass upon the issuance and sale of the Notes
as herein contemplated and related proceedings, or in order to evidence the
accuracy of any of the representations and warranties, or the fulfillment of any
of the conditions, herein contained; and all proceedings taken by the Company
and the Guarantor in connection with the issuance and sale of the Notes and the
Guarantee as herein contemplated shall be satisfactory in form and substance to
the Agents and counsel to such Agents.
If any condition specified in this Section shall not have been
fulfilled as of the relevant date required, this Agreement and any Terms
Agreement may be terminated as to any Agent by notice
20
by such Agent to the Company at any time with respect to this Agreement and at
or prior to the applicable Settlement Date with respect to Notes purchased by an
Agent pursuant to a Terms Agreement, and any such termination shall be without
liability of any party to any other party, except that the provisions of Section
3(c) (except that the Guarantor shall no longer be required to comply with the
provisions of Section 3(c) after it has made generally available to its security
holders an earnings statement (which need not be audited) covering a
twelve-month period beginning after the date of the last sale of Notes hereunder
which satisfies the provisions of Rule 158 of the Rules and Regulations), the
provisions of Section 3(h), the indemnity and contribution agreements set forth
in Section 6, and the provisions of Sections 2(e), 8 and 12 shall remain in
effect.
5. Additional Agreements of the Company and the Guarantor.
Each of the Company and the Guarantor covenants and agrees that:
(a) Each acceptance by the Company of an offer for the
purchase of Notes, and each sale of Notes to any Agent pursuant to a Terms
Agreement, shall be deemed to be an affirmation by each of the Company and the
Guarantor that the representations and warranties of the Company and the
Guarantor contained in this Agreement and in the most recent certificate
theretofore delivered to the Agents pursuant to Sections 4(d) and 4(e) or 5(b),
as the case may be, 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 the Agents, 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 the Prospectus as amended and supplemented to each
such time).
(b) Each time the Registration Statement or Prospectus is
amended or supplemented (other than by an amendment or supplement providing
solely for a change in the interest rates, redemption provisions, offering
price, principal amount, amortization schedules or maturities offered on the
Notes or for a change deemed immaterial in the reasonable opinion of each Agent
or other than by an amendment or supplement relating solely to securities other
than the Notes or solely establishing the terms of particular Notes to be sold
pursuant hereto), the Company and the Guarantor shall each deliver or cause to
be delivered forthwith to each Agent a certificate signed by an executive
officer of the Company or the Guarantor, as the case may be, dated the date of
such amendment or supplement, as the case may be, in form reasonably
satisfactory to such Agent, of the same tenor as the certificate referred to in
Sections 4(d) and 4(e) modified as necessary to relate to the Registration
Statement or the Prospectus as amended and supplemented to the time of delivery
of such certificate; provided, however, that neither the Company nor the
Guarantor shall be required to furnish any certificates to any Agent pursuant to
this paragraph at a time when such Agent shall have suspended solicitation of
purchases of Notes in its capacity as agent pursuant to instructions of the
Company and the Guarantor.
(c) Each time the Company and the Guarantor furnish
certificates pursuant to Section 5(b), the Company and the Guarantor shall
furnish or cause to be furnished forthwith to each Agent written opinions of
counsel for the Company, the Guarantor and Textron. Any such opinion shall be
dated the date of such amendment or supplement, as the case may be, shall be in
a form satisfactory to such Agent and shall be of the same tenor as the opinions
referred to in Section 4(c), but modified to relate to the Registration
Statement or the Prospectus as amended and supplemented to the time of delivery
of such opinions. In lieu of such opinions, counsel last furnishing such
opinions to such Agent may furnish to such Agent letters to the effect that such
Agent may rely on such last opinions to the same extent as though they were
dated the date of such letters (except that statements in such last opinions
will be deemed to relate to the Registration Statement or the Prospectus as
amended and
21
supplemented to the time of delivery of such letters); provided, however, that
no such opinions need be furnished to any Agent pursuant to this paragraph at a
time when such Agent shall have suspended solicitation of purchases of Notes in
its capacity as agent pursuant to instructions of the Company and the Guarantor.
(d) Each time the Registration Statement or the Prospectus is
amended or supplemented to set forth amended or supplemental financial
information or such amended or supplemental financial information is
incorporated by reference in the Registration Statement or the Prospectus, the
Company and the Guarantor shall cause ▇▇▇▇▇ & Young LLP, or any other nationally
recognized firm of independent public accountants reasonably satisfactory to the
Agents, forthwith to furnish each Agent with a letter, dated the date of such
amendment or supplement, as the case may be, in form satisfactory to such Agent,
of the same tenor as the letter referred to in Section 4(f), with regard to the
amended or supplemental financial information included or incorporated by
reference in the Registration Statement or the Prospectus as amended or
supplemented to the date of such letter; provided, however, that if the
Registration Statement or the Prospectus is amended or supplemented solely to
include financial information as of and for a fiscal quarter, Ernst & Young LLP
or such other firm may limit the scope of such letter to the unaudited financial
statements included in such amendment or supplement unless any other information
included therein of an accounting or financial nature is such that, in the
Agents' reasonable judgment, such letter should cover such other information;
provided further, however, that neither the Company nor the Guarantor shall be
required to cause Ernst & Young LLP or another firm of certified public
accountants reasonably satisfactory to the Agents to furnish a letter to any
Agent pursuant to this paragraph at a time when such Agent shall have suspended
solicitation of purchases of Notes in its capacity as agent pursuant to
instructions of the Company and the Guarantor.
6. Indemnification and Contribution. (a) The Company and the
Guarantor agree to jointly and severally indemnify and hold harmless each Agent
and each person, if any, who controls such Agent within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act from and
against any and all losses, claims, damages and liabilities caused by any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement, any preliminary prospectus or the Prospectus (if used
within the period during which a prospectus is required by law to be delivered
and as amended or supplemented if the Company or the Guarantor shall have
furnished any amendments or supplements thereto), or caused by 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; provided, however,
that the Company and the Guarantor shall not be liable to any Agent under the
indemnity agreement in this subsection (a) with respect to any such loss, claim,
damage or liability of such Agent (i) that are caused by any such untrue
statement or omission or alleged untrue statement or omission based on
information furnished in writing to the Company and the Guarantor by any Agent
expressly for use therein or (ii) that result from a sale of Notes to a person
to whom there was not sent or given, at or prior to the written confirmation of
such sale, a copy of the Prospectus as then amended or supplemented (excluding
documents incorporated by reference therein) in any case where such delivery is
required by the Securities Act if the Company and the Guarantor have previously
furnished copies thereof to such Agent and the loss, claim, damage or liability
results from an untrue statement or omission of a material fact contained in the
Prospectus which was corrected in the Prospectus (as then amended, supplemented
or modified) and which was identified at such time to such Agent.
(b) Each Agent agrees severally and not jointly to indemnify
and hold harmless the Company, the Guarantor, their respective directors,
officers who sign the Registration Statement and any person controlling the
Company or the Guarantor to the same extent as the foregoing indemnity from the
22
Company and the Guarantor to each Agent, but only with reference to information
furnished in writing by such Agent expressly for use in the Registration
Statement, any preliminary prospectus or the Prospectus.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to either of the two preceding paragraphs, such
person (the "indemnified party") shall promptly notify the indemnifying party
and the person against whom such indemnity may be sought (the "indemnifying
party") in writing. In case any such proceeding is brought against any
indemnified party and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel reasonably satisfactory to
such indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Agreement for any legal expenses of other counsel or any other expenses, in each
case subsequently incurred by such indemnified party, in connection with the
defense thereof other than reasonable costs of investigation. Notwithstanding
the foregoing, in any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless (i) the indemnifying party
and the indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. It is understood
that the indemnifying party shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable fees
and expenses of more than one separate firm (in addition to any local counsel)
for all such indemnified parties and that all such fees and expenses shall be
reimbursed as they are incurred. Such firm shall be designated in writing by the
Agents in the case of parties indemnified pursuant to the second preceding
paragraph and by the Company and the Guarantor in the case of parties
indemnified pursuant to the first preceding paragraph. The indemnifying party
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if final judgment is
entered for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any proceeding in
respect of which any indemnified party is a party unless such settlement (i)
includes an unconditional release of such indemnified party from all liability
on claims that are the subject matters of such proceeding, and (ii) does not
include a statement as to an admission of fault, culpability or a failure to act
by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section is
unavailable to an indemnified party under the first or second paragraphs hereof
or insufficient in respect of any losses, claims, damages or liabilities
referred to therein, then each indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (i)
in such proportion as is appropriate to reflect the relative benefits received
by the Company and the Guarantor on the one hand and of each Agent participating
in the offering of Notes that gave rise to such losses, claims, damages or
liabilities (or actions in respect thereof) (a "Relevant Agent"), on the other
hand or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Company and the Guarantor on the one hand and of the Relevant Agent on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
23
considerations. The relative benefit received by the Company and the Guarantor
on the one hand and the Relevant Agent on the other shall be deemed to be in the
same proportion as the total net proceeds from the sale of Notes (before
deducting expenses) received by the Company bear to the total commissions or
discounts received by such Relevant Agent in respect thereof. The relative fault
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information supplied by the Company and the
Guarantor or the Relevant Agent and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission.
The Company and the Guarantor and the Agents agree that it
would not be just and equitable if contributions pursuant to this subsection (d)
were determined by pro rata allocation (even if the Agents were treated as one
entity for such purpose) or 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 an indemnified party 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 indemnified party in connection with
investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding the provisions of this subsection (d), no
Relevant Agent shall be required to contribute any amount in excess of the
amount by which (x) the sum of (i) the total price at which the Notes, the
purchase of which is the subject of the claim for contribution and which was
solicited by such Relevant Agent, were sold by the Company and (ii) the total
price at which the Notes, the purchase of which is the subject of the claim for
contribution and which such Relevant Agent purchased as principal and
distributed to the public, were offered to the public, exceeds (y) the amount of
any damages which such Relevant Agent has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
obligations of each of the Agents under this subsection (d) to contribute are
several in proportion to the respective purchases made by or through it to which
such loss, claim, damage or liability (or action in respect thereof) relates and
are not joint.
(e) The remedies provided for in this Section are not
exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity. The indemnity and
contribution agreements contained in this Section and the representations and
warranties of the Company and the Guarantor in this Agreement shall remain
operative and in full force and effect regardless of (i) any termination of this
Agreement, (ii) any investigation made by any Agent or on behalf of any Agent or
any person controlling any Agent or by or on behalf of the Company and the
Guarantor, their respective directors or officers or any person controlling the
Company or the Guarantor and (iii) acceptance of and payment for any of the
Notes.
7. Termination. This Agreement may be terminated at any time
either (a) by the Company and the Guarantor as to any Agent or all of the Agents
or (b) by any Agent, insofar as this Agreement relates to such Agent, in either
case, upon the giving of 30 days' written notice of such termination to the
other parties hereto. In the event of such termination with respect to any
Agent, this Agreement shall remain in full force and effect with respect to any
Agent as to which such termination has not occurred. The termination of this
Agreement shall not require termination of any agreement by any Agent to
purchase Notes as principal, and the termination of any such agreement shall not
require termination of this Agreement. If this Agreement is terminated, the
provisions of the third paragraph of Section 2(a), the last sentence of Section
2(g), the last two sentences of Section 3(b), Section 3(c) (except that the
Guarantor shall no longer be required to comply with the provisions of Section
3(c) after
24
it has made generally available to its security holders an earnings statement
(which need not be audited) covering a twelve-month period beginning after the
date of the last sale of Notes hereunder which shall satisfy the provisions of
Rule 158 of the Rules and Regulations), 3(h), 6, 8 and 12 shall survive;
provided that if at the time of termination an offer to purchase Notes has been
accepted by the Company but the time of delivery to the purchaser or its agent
of such Notes has not occurred, the provisions of Sections 2(c) and 3 shall also
survive. If any Terms Agreement is terminated, the provisions of Sections 3(c)
(except that the Guarantor shall no longer be required to comply with the
provisions of Section 3(c) after it has made generally available to its security
holders an earning statement (which need not be audited) covering a twelve-month
period beginning after the date of the last sale of Notes hereunder which shall
satisfy the provisions of Rule 158 of the Rules and Regulations), 3(h), 6, 8 and
12 and the last two sentences of Section 3(b) (which shall have been
incorporated by reference in such Terms Agreement) shall survive.
8. Representations and Indemnities to Survive. The respective
indemnity and contribution agreements, representations, warranties and other
statements of the Company and the Guarantor, their respective officers and each
Agent set forth in or made pursuant to this Agreement or any agreement by such
Agent to purchase Notes as principal will remain in full force and effect,
regardless of any termination of this Agreement, any investigation made by or on
behalf of such Agent or the Company and the Guarantor or any of the officers,
directors or controlling persons referred to in Section 6 and delivery of and
payment for the Notes.
9. Notices. All communications hereunder will be in writing
and shall be deemed to have been duly given if hand delivered, sent by
first-class mail (postage prepaid) or transmitted by facsimile (confirmed in
writing by hand delivery or first-class mail sent on the date of such facsimile
communication) as follows:
if to an Agent, to it at its address set forth on Schedule 1 hereto and if to
the Company and the Guarantor, to:
Textron Financial Corporation
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-6687
Attention: Treasurer
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to the Guarantor's General Counsel at:
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇-6687
Attention: General Counsel
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
and to:
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
25
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
10. Successors. This Agreement and any Terms Agreement will
inure to the benefit of and be binding upon the parties hereto and their
respective successors and the officers, directors and controlling persons
referred to in Section 6 and their heirs and legal representatives and the
purchasers of Notes (to the extent expressly provided herein), and no other
person will have any right or obligation hereunder. No purchaser of Notes,
except as provided herein, shall be deemed to be a successor by reason merely of
such purchase.
11. Counterparts. This Agreement may be signed in any number
of counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
12. Consent to Jurisdiction; Miscellaneous. To the extent the
parties may do so by applicable law, each of the parties hereto hereby expressly
and irrevocably submits to the non-exclusive jurisdiction of any competent court
in the place of its domicile and any United States Federal or New York State
court sitting in the Borough of Manhattan in The City of New York in any action,
suit or proceeding arising out of or relating to this Agreement or the
applicable Terms Agreement or the transactions contemplated hereby or thereby to
the extent that such court has subject matter jurisdiction over the controversy,
and expressly and irrevocably waives, to the extent permitted under applicable
law, any immunity from the jurisdiction thereof and any claim or defense in such
action, suit or proceeding based on a claim of improper venue, forum non
conveniens or any similar basis to which it might otherwise be entitled in any
such action, suit or proceeding. Each of the Company and the Guarantor
irrevocably appoints CT Corporation, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, as its authorized agent in the Borough of Manhattan in The City of New
York upon which process may be served in any such action, suit or proceeding,
and agrees that service of process upon such agent, and written notice of said
service to the Company or the Guarantor by the person serving the same to the
address provided in Section 9, shall be deemed in every respect effective
service of process upon the Company or the Guarantor, as the case may be, in any
such action, suit or proceeding. Each of the Company and the Guarantor further
agrees to take any and all action as may be necessary to maintain such
designation and appointment of such agent in full force and effect for a period
of seven years from the date of this Agreement.
13. Waiver of Immunities. To the extent that the Company or
the Guarantor or any of their respective properties, assets or revenues may have
or may hereafter become entitled to, or have attributed to them, any right of
immunity, on the grounds of sovereignty, from any legal action, suit or
proceeding, from set-off or counterclaim, from the jurisdiction of any court,
from service of process, from attachment upon or prior to judgment, or from
attachment in aid of execution of judgment, or from execution of judgment, other
legal process or proceeding for the giving of any relief or for the enforcement
of any judgment, in any jurisdiction in which proceedings may at any time be
commenced, with respect to their obligations, liabilities or any other matter
under or arising out of or in connection with this Agreement or any additional
agreement, each of the Company and the Guarantor hereby irrevocably and
unconditionally, to the extent permitted by applicable law, waives and agrees
not to plead or claim any such immunity and consents to such relief and
enforcement.
14. Judgment Currency. The Company and the Guarantor jointly
and severally agree to indemnify each Agent against any loss incurred by such
Agent as a result of any judgment or order being given or made for any amount
due hereunder and such judgment or order being expressed and
26
paid in a currency (the "Judgment Currency") other than United States dollars
and as a result of any variation as between (i) the rate of exchange at which
the United States dollar amount is converted into the Judgment Currency for the
purpose of such judgment or order, and (ii) the rate of exchange at which such
Agent is able to purchase United States dollars with the amount of the Judgment
Currency actually received by such Agent. The foregoing indemnity shall
constitute a separate and independent obligation of each of the Company and the
Guarantor and shall continue in full force and effect notwithstanding any such
judgment or order as aforesaid. The term "rate of exchange" shall include any
premiums and costs of exchange payable in connection with the purchase of, or
conversion into, the relevant currency.
15. APPLICABLE LAW. THIS AGREEMENT WILL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO THE CONFLICTS OF LAWS PROVISIONS THEREOF.
16. Headings. The headings of the sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed a
part of this Agreement.
[SIGNATURE PAGES FOLLOW]
27
If the foregoing is in accordance with the understanding of
the Agents of our agreement, please sign and return to us the enclosed duplicate
hereof, whereupon this letter and the acceptance of the Agents shall represent a
binding agreement among the Company, the Guarantor and such Agent.
Very truly yours,
TEXTRON FINANCIAL CANADA FUNDING CORP.,
as issuer of the Notes
By:
------------------------------------------
Name:
Title:
TEXTRON FINANCIAL CORPORATION, as Guarantor
By:
------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇
Title: Vice President and Treasurer
[SIGNATURE PAGE TO DISTRIBUTION AGREEMENT]
28
The foregoing Agreement
is hereby confirmed
and accepted as of the
date first above written.
▇▇▇▇▇▇▇ LYNCH, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By:
------------------------------------
Name:
Title:
BANC OF AMERICA SECURITIES LLC
By:
------------------------------------
Name:
Title:
BANC ONE CAPITAL MARKETS, INC.
By:
------------------------------------
Name:
Title:
BARCLAYS CAPITAL INC.
By:
-------------------------------------
Name:
Title:
CREDIT SUISSE FIRST BOSTON CORPORATION
By:
-------------------------------------
Name:
Title:
[SIGNATURE PAGE TO DISTRIBUTION AGREEMENT]
29
DEUTSCHE BANK ALEX. BROWN INC.
By:
--------------------------------------
Name:
Title:
By:
--------------------------------------
Name:
Title:
FIRST UNION SECURITIES, INC.
By:
--------------------------------------
Name:
Title:
FLEET SECURITIES, INC.
By:
--------------------------------------
Name:
Title:
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
By:
--------------------------------------
Name:
Title:
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ INC.
By:
--------------------------------------
Name:
Title:
[SIGNATURE PAGE TO DISTRIBUTION AGREEMENT]
30
UBS WARBURG LLC
By:
--------------------------------------
Name:
Title:
[SIGNATURE PAGE TO DISTRIBUTION AGREEMENT]
31
Schedule 1
Name Address for Notices
▇▇▇▇▇▇▇ Lynch, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated ▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: MTN Product Management
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Banc of America Securities LLC ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Managing Director
Banc of America Securities LLC
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Banc One Capital Markets, Inc. Corporate Securities Structuring
Banc One Capital Markets, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Barclays Capital Inc. ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Barclays Capital Inc.
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Credit Suisse First Boston Corporation Credit Suisse First Boston Corporation
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Short and Medium-Term Finance
Tel:
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Deutsche Bank ▇▇▇▇. ▇▇▇▇▇ Inc. ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Managing Director
Deutsche Bank Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
32
Name Address for Notices
First Union Securities, Inc. ▇▇▇ ▇▇▇▇▇▇▇▇
Director
Debt Capital Markets
First Union Securities, Inc.
One First Union Center, TW-▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Fleet Securities, Inc. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Managing Director
Fleet Securities, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇.▇. ▇▇▇▇▇▇ Securities Inc. Transaction Execution Group
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. ▇▇▇▇▇ ▇▇▇▇▇▇
Managing Director
▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ - ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
UBS Warburg LLC ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Director
UBS Warburg LLC
UBS Warburg Dillon Read
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
33
EXHIBIT A
TEXTRON FINANCIAL CANADA FUNDING CORP.
Medium-Term Notes, Series E-CAD
Fully and Unconditionally Guaranteed
by
TEXTRON FINANCIAL CORPORATION
Terms Agreement
Textron Financial Canada Funding Corp.
Textron Financial Corporation
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
P.O. Box 6687
Providence, Rhode Island 02940-6687
Attention:
Re: Distribution Agreement dated as of November , 2001
(the "Distribution Agreement")
The undersigned agrees to purchase your Medium-Term Notes, Series E-CAD
(the "Notes"), having the following terms:
If Fixed Rate Notes:
Principal Amount: Interest Rate:
Agent's Discount or Commission: Original Issue Date:
Net Proceeds to Issuer: Stated Maturity Date:
Interest Payment Dates:
- March 15 and September 15
- Other:
Regular Record Dates
(if other than the last day of February and August):
Redemption:
- The Notes cannot be redeemed prior to the Stated Maturity Date.
- The Notes can be redeemed prior to the Stated Maturity Date.
Initial Redemption Date:
Initial Redemption Percentage:%
Annual Redemption Percentage Reduction: _______% until Redemption
Percentage is 100% of the Principal Amount.
Optional Repayment:
- The Notes cannot be repaid prior to the Stated Maturity Date.
- The Notes can be repaid prior to the Stated Maturity Date at the
option of the holder of the Notes.
Optional Repayment Date(s):
Optional Repayment Price(s):
Specified Currency (if other than U.S. dollars):
Exhibit A
Page 3
Authorized Denomination (if other than $1,000 and integral multiples thereof):
Exchange Rate Agent:
Original Issue Discount: - Yes - No
Issue Price: %
Total Amount of OID:
Yield to Maturity:
Initial Accrual Period OID:
Agent:
- ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇ - First Union Securities, Inc.
Incorporated - Fleet Securities, Inc.
- Banc of America Securities LLC - ▇.▇. ▇▇▇▇▇▇ Securities Inc.
- Banc One Capital Markets, Inc. - ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
- Barclays Capital Inc. - UBS Warburg LLC
- Credit Suisse First Boston Corporation - Other: ________________
- Deutsche Bank ▇▇▇▇. ▇▇▇▇▇ Inc.
Agent acting in the capacity as indicated below:
- Agent - Principal
If as Principal:
- The Notes are being offered at varying prices related to prevailing
market prices at the time of resale.
- The Notes are being offered at a fixed initial public offering price
of _____% of the Principal Amount.
If as Agent:
The Notes are being offered at a fixed initial public offering price of
_____ % of Principal Amount.
Other Provisions:
If Floating Rate Notes:
Principal Amount: Initial Interest Rate:
Agent's Discount or Commission: Original Issue Date:
Net Proceeds to Issuer: Stated Maturity Date:
Interest Category
- Regular Floating Rate Note
- Floating Rate/Fixed Rate Note
Fixed Rate Commencement Date:
Fixed Interest Rate: %
- Inverse Floating Rate Note
- Fixed Interest Rate: %
Interest Rate Basis or Bases:
- CD Rate - Federal Funds Rate - Prime Rate
- CMT Rate - LIBOR - Other (see attached)
- Commercial Paper Rate - Treasury Rate
Exhibit A
Page 4
If LIBOR:
- LIBOR Reuters Page:
- LIBOR Telerate Page:
LIBOR Currency:
If CMT Rate:
CMT Telerate Page:
- Telerate Page 7051
- Telerate Page 7052
- Weekly Average
- Monthly Average
Spread (+/-): Maximum Interest Rate: %
Spread Multiplier: Minimum Interest Rate: %
Index Maturity:
Initial Interest Reset Date:
Interest Reset Dates:
Interest Payment Dates:
Interest Determination Dates:
Regular Record Date(s):
Calculation Agent (if other than SunTrust Bank):
Day Count Convention:
- Actual/360 for the period from ________ to___________
- Actual/Actual for the period from ______ to ___________
- 30/360 for the period from _______to _________
Redemption:
- The Notes cannot be redeemed prior to the Stated Maturity Date. - The
- Notes can be redeemed prior to Stated Maturity Date.
Initial Redemption Date:
Initial Redemption Percentage: _____%
Annual Redemption Percentage Reduction: _____% until Redemption
Percentage is 100% of the Principal Amount.
Optional Repayment:
- The Notes cannot be repaid prior to the Stated Maturity Date.
- The Notes can be repaid prior to the Stated Maturity Date at the
option of the holder of the Notes.
Optional Repayment Date(s):
Optional Repayment Price(s):
Specked Currency (if other than U.S. dollars):
Authorized Denomination (if other than $1,000 and integral multiples thereof):
Exchange Rate Agent:
Original Issue Discount: - Yes - No
- Issue Price: ______%
Total Amount of OID:
Yield to Maturity: _____%
Initial Accrual Period OID:
Exhibit A
Page 5
Agent:
- ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇ - First Union Securities, Inc.
Incorporated - Fleet Securities, Inc.
- Banc of America Securities LLC - ▇.▇. ▇▇▇▇▇▇ Securities Inc.
- Banc One Capital Markets, Inc. - ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc.
- Barclays Capital Inc. - UBS Warburg LLC
- Credit Suisse First Boston Corporation - Other: ________________
- Deutsche Bank ▇▇▇▇. ▇▇▇▇▇ Inc.
Agent acting in the capacity as indicated below:
- Agent - Principal
If as Principal:
- The Notes are being offered at varying prices related to prevailing
market prices at the time of resale.
- The Notes are being offered at a
fixed initial public offering price of % of the Principal Amount.
If as Agent:
The Notes are being offered at a fixed initial public offering price of
____% of the Principal Amount.
Other provisions:
Terms are not completed for certain items above because such
items are not applicable.
Unless otherwise defined herein or in the Distribution
Agreement, terms defined in the Indenture, the Notes or the Prospectus
Supplement shall be used herein as therein defined. The provisions of Sections
1, 2(b), 2(c), 3, 4 and 6 through 13 of the Distribution Agreement and the
related definitions are incorporated by reference herein and shall be deemed to
have the same force and effect as if set forth in full herein.
The opinions referred to in Section 4(c) of the Distribution
Agreement, the certificate referred to in Section 4(d) of the Distribution
Agreement and the accountants' letter referred to in Section 4(e) of the
Distribution Agreement will be required.
[SIGNATURE PAGE FOLLOWS]
Exhibit A
Page 6
[NAME OF PURCHASER]
By:
--------------------------
(Authorized Signatory)
Accepted as of the date written above:
TEXTRON FINANCIAL CANADA FUNDING CORP.,
as issuer of the Notes
By:
------------------------------------
Name:
Title:
TEXTRON FINANCIAL CORPORATION, as Guarantor
By:
------------------------------------
Name:
Title:
EXHIBIT B
TEXTRON FINANCIAL CANADA FUNDING CORP.
MEDIUM-TERM NOTES, SERIES E-CAD
FULLY AND UNCONDITIONALLY GUARANTEED
BY
TEXTRON FINANCIAL CORPORATION
ADMINISTRATIVE PROCEDURES
Explained below are the administrative procedures and specific terms
of the offering of Medium-Term Notes, Series E-CAD on a continuous basis by
Textron Financial Canada Funding Corp. (the "Company") pursuant to the
Distribution Agreement, dated as of November , 2001 (the "Distribution
Agreement") between the Company, the Guarantor and the persons listed on
Schedule 1 to the Distribution Agreement (collectively, the "Agents"). In the
Distribution Agreement, each Agent has agreed to use its best efforts to solicit
purchases of the Notes. An Agent, as principal, may purchase Notes for its own
account and if requested by such Agent, the Company and the Agent will enter
into a Terms Agreement, as contemplated by the Distribution Agreement.
The Notes will be issued pursuant to the provisions of the
Indenture, dated as of November , 2001 (the "Indenture"), among the Company,
Textron Financial Corporation, as guarantor, and SunTrust Bank, as trustee (the
"Trustee"). The Trustee will be the Registrar, Calculation Agent (if applicable)
and Paying Agent for the Notes, and will perform the duties specified herein.
Notes will bear interest at a fixed rate (the "Fixed Rate Notes") or at floating
rates (the "Floating Rate Notes"). The principal of and interest on the Notes
will be payable in U.S. dollars only. Each Note will be represented by either a
Global Security (as defined below) delivered to the Trustee as agent for The
Depository Trust Company ("DTC"), and recorded in the book-entry system
maintained by DTC (a "Book-Entry Note"), or a certificate delivered to the
holder thereof or a person designated by such holder (a "Certificated Note").
Except in limited circumstances, an owner of a Book-Entry Note will not be
entitled to receive a Certificated Note.
Book-Entry Notes will be issued in accordance with the
administrative procedures set forth in Part I hereof as they may subsequently be
amended as the result of changes in DTC's operating procedures, and Certificated
Notes will be issued in accordance with the administrative procedures set forth
in Part II hereof. Unless otherwise defined herein or in the Distribution
Agreement, terms defined in the Indenture, the Notes or the Prospectus
Supplement shall be used herein as therein defined.
PART I: ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY NOTES
In connection with the qualification of the Book-Entry Notes for
eligibility in the book-entry system maintained by DTC, the Trustee will perform
the custodial, document control and administrative functions described below, in
accordance with its respective obligations under a Letter of Representation from
the Guarantor and the Trustee to DTC, dated as of June 23, 2000, as amended to
date (the "Letter of Representation"), and a Medium-Term Note Certificate
Agreement between the Trustee and DTC, dated August 16, 1999, and its
obligations as a participant in DTC, including DTC's Same-Day Funds Settlement
System ("SDFS").
Exhibit B
Page 2
Issuance: On any date of settlement (as defined under
"Settlement" below) for one or more Book-Entry
Notes, the Company will issue a single global
security in fully registered form without
coupons (a "Global Security") representing up to
$400,000,000 principal amount of all such Notes
that have the same purchase price, settlement
date, Maturity Date, redemption provisions,
Interest Payment Dates, Original Issue Date and,
in the case of Fixed Rate Notes, Interest Rate
or, in the case of Floating Rate Notes, Initial
Interest Rate, Interest Payment Dates, Interest
Payment Period, Calculation Agent, Base Rate,
Index Maturity, Interest Reset Period, Interest
Reset Dates, Spread or Spread Multiplier (if
any), Minimum Interest Rate (if any) and Maximum
Interest Rate (if any), and any other relevant
terms (collectively "Terms"). Each Global
Security will be dated and issued as of the date
of its authentication by the Trustee. Book-Entry
Notes may only be denominated and payable in
U.S. dollars. No Global Security will represent
any Certificated Note.
Identification Numbers: The Company has arranged with the CUSIP Service
Bureau of Standard & Poor's Corporation (the
"CUSIP Service Bureau") for the reservation of a
series of approximately 900 CUSIP numbers
(including tranche numbers) for assignment to
Global Securities representing the Book-Entry
Notes. The Company has obtained from the CUSIP
Service Bureau a written list of series of
reserved CUSIP numbers and has delivered to the
Trustee and DTC the written list of 900 CUSIP
numbers of such series. The Company will assign
CUSIP numbers to Global Securities as described
below under Settlement Procedure "B". DTC will
notify the CUSIP Service Bureau periodically of
the CUSIP numbers that the Company has assigned
to Global Securities. At any time when fewer
than 100 of the reserved CUSIP numbers remain
unassigned to Global Securities, the Company, if
it deems necessary, will reserve additional
CUSIP numbers for assignment to Global
Securities representing Book-Entry Notes. Upon
obtaining such additional CUSIP numbers, the
Company shall deliver a list of such additional
CUSIP numbers to the Trustee and DTC.
Exhibit B
Page 3
Registration: Each Global Security will be registered in the
name of Cede & Co., as nominee for DTC, on the
Security Register maintained under the
Indenture. The beneficial owner of a Book-Entry
Note (or one or more indirect participants in
DTC designated by such owner) will designate one
or more participants in DTC (with respect to
such Note, the "Participants") to act as agent
or agents for such owner in connection with the
book-entry system maintained by DTC, and DTC
will record in book-entry form, in accordance
with instructions provided by such Participants,
a credit balance with respect to such beneficial
owner in such Note in the account of such
Participants. The ownership interest of such
beneficial owner in such Note will be recorded
through the records of such Participants or
through the separate records of such
Participants and one or more indirect
participants in DTC.
Transfers: Transfers of a Book-Entry Note will be
accompanied by book entries made by DTC and, in
turn, by Participants (and in certain cases, one
or more indirect participants in DTC) acting on
behalf of beneficial transferors and transferees
of such Note.
Exchanges: The Trustee may deliver to DTC and the CUSIP
Service Bureau at any time a written notice of
consolidation specifying (i) the CUSIP numbers
of two or more Outstanding Global Securities
that represent Book-Entry Notes having the same
Terms and for which interest has been paid to
the same date, (ii) a date, occurring at least
thirty days after such written notice is
delivered and at least thirty days before the
next Interest Payment Date for such Book-Entry
Notes, on which such Global Securities shall be
exchanged for a single replacement Global
Security and (iii) a new CUSIP number to be
assigned to such replacement Global Security.
Upon receipt of such a notice, DTC will send to
its Participants (including the Trustee) a
written reorganization notice to the effect that
such exchange will occur on such date. Prior to
the specified exchange date, the Trustee will
deliver to the CUSIP Service Bureau a written
notice setting forth such exchange date and the
new CUSIP number and stating that, as of such
exchange date, the CUSIP numbers of the Global
Securities to be
Exhibit B
Page 4
exchanged will no longer be valid. On the
specified exchange date, the Trustee will
exchange such Global Securities for a single
Global Security bearing the new CUSIP number and
the CUSIP numbers of the exchanged Global
Securities will, in accordance with CUSIP
Service Bureau procedures, be canceled and not
immediately reassigned. Notwithstanding the
foregoing, if the Global Securities to be
exchanged exceed $400,000,000 in aggregate
principal amount, one Global Security will be
authenticated and issued to represent each
$400,000,000 principal amount of the exchanged
Global Security and an additional Global
Security will be authenticated and issued to
represent any remaining principal amount of such
Global Securities (see "Denominations" below).
In such a case, each of the Global Securities
representing such Book-Entry Note or Notes shall
be assigned the same CUSIP number.
Maturities: Each Book-Entry Note will mature on a date nine
months or more from its date of issue.
Notice of Redemption Dates: The Trustee will give notice to DTC prior to
each Redemption Date (as specified in the Note),
if any, at the time and in the manner set forth
in the Letter of Representation.
Denominations: Unless the applicable Pricing Supplement
provides otherwise, Book-Entry Notes will be
issued in principal amounts of $1,000 or any
amount in excess thereof that is an integral
multiple of $1,000. Global Securities will be
denominated in principal amounts not in excess
of $400,000,000. If one or more Book-Entry Notes
having an aggregate principal amount in excess
of $400,000,000 would, but for the preceding
sentence, be represented by a single Global
Security, then on Global Security will be issued
to represent each $400,000,000 principal amount
of such Book-Entry Note or Notes and an
additional Global Security will be issued to
represent any remaining principal amount of such
Book-Entry Note or Notes. In such a case, each
of the Global Securities representing such
Book-Entry Note or Notes shall be assigned the
same CUSIP number.
Exhibit B
Page 5
Interest: General. Interest on each Book-Entry Note will
accrue from and including the Original Issue
Date of the Global Security representing such
Note for the first interest period and from and
including the most recent date to which interest
has been paid for all subsequent interest
periods. Each payment of interest on a
Book-Entry Note will include interest accrued to
but excluding the Interest Payment Date;
provided that in the case of Floating Rate Notes
that reset daily or weekly, interest payments
will include interest accrued to and including
the Regular Record Date immediately preceding
the Interest Payment Date, except that at
maturity or earlier repurchase or redemption,
the interest payable will include interest
accrued to, but excluding, the maturity date or
the date of repurchase or redemption, as the
case may be (other than a maturity of a Fixed
Rate Book Entry Note occurring on the 31st day
of a month, in which case such payment of
interest will include interest accrued to but
excluding the 30th day of such month). Interest
payable at the maturity or upon repurchase or
redemption of a Book-Entry Note will be payable
to the person to whom the principal of such Note
is payable. Standard & Poor's Corporation will
use the information received in the pending
deposit message described under Settlement
Procedure "C" below in order to include the
amount of any interest payable and certain other
information regarding the related Global
Security in the appropriate weekly bond report
published by Standard & Poor's Corporation.
Regular Record Dates. The Regular Record Date
with respect to any Interest Payment Date shall
be the date fifteen calendar days immediately
preceding such Interest Payment Date.
Fixed Rate Book-Entry Notes. Unless otherwise
specified in the applicable Pricing Supplement,
interest payments on Fixed Rate Book-Entry Notes
will be made semiannually on March 15 and
September 15 of each year and at maturity or
upon any earlier repurchase or redemption;
provided, however, that in the case of a Fixed
Rate Book-Entry Note issued between a Regular
Record Date and an Interest Payment Date, the
first interest
Exhibit B
Page 6
payment will be made on the Interest Payment
Date following the next succeeding Regular
Record Date.
Floating Rate Book-Entry Notes. Interest
payments will be made on Floating Rate
Book-Entry Notes weekly, monthly, quarterly,
semiannually or annually. Unless otherwise
agreed upon, interest will be payable, in the
case of Floating Rate Book-Entry Notes with a
daily, weekly or monthly Interest Reset Date, on
the Wednesday of each week (or Tuesday in the
case of Floating Rate Book-Entry Notes as to
which the Treasury Rate is an applicable
interest rate basis), or the third Wednesday of
each month, respectively, or as specified
pursuant to Settlement Procedure "A" below; in
the case of Notes with a quarterly Interest
Reset Date, on the third Wednesday of March,
June, September and December of each year; in
the case of Notes with a semi-annual Interest
Reset Date, on the third Wednesday of the two
months of each year specified pursuant to
Settlement Procedure "A" below; and in the case
of Notes with an annual Interest Reset Date, on
the third Wednesday of the month of each year
specified pursuant to Settlement Procedure "A"
below; provided, however, that if any Interest
Payment Date for Floating Rate Book-Entry Notes
(other than the Maturity Date, a repurchase date
or a redemption date) would otherwise be a day
that is not a Business Day with respect to such
Floating Rate Book-Entry Notes, such Interest
Payment Date will be the next succeeding
Business Day with respect to such Floating Rate
Book-Entry Notes, except in the case of a LIBOR
Note, if such Business Day is in the next
succeeding calendar month, such Interest Payment
Date will be the Business Day immediately
preceding the day that would have otherwise been
such Interest Payment Date; and provided,
further, that in the case of a Floating Rate
Book-Entry Note issued between a Regular Record
Date and an Interest Payment Date, the first
interest payment will be made on the Interest
Payment Date following the next succeeding
Regular Record Date.
Calculation of Interest: Fixed Rate Book-Entry Notes. Unless otherwise
specified in the applicable Pricing Supplement,
interest on Fixed Rate Book-Entry Notes
(including
Exhibit B
Page 7
interest for partial periods) will be calculated
on the basis of a year of twelve thirty-day
months.
Floating Rate Book-Entry Notes. Interest rates
on Floating Rate Book-Entry Notes will be
determined as set forth in the form of Notes.
Unless otherwise specified in the applicable
Pricing Supplement, interest on Floating Rate
Book-Entry Notes will be calculated on the basis
of actual days elapsed and a year of 360 days
except that in the case of Treasury Rate Notes
or CMT Rate Notes, interest will be calculated
on the basis of the actual number of days in the
year.
Payments of Principal
and Interest: Promptly after each Regular Record Date, the
Trustee will deliver to the Company and DTC a
written notice specifying by CUSIP number the
amount of interest to be paid on each Global
Security on the following Interest Payment Date
(other than an Interest Payment Date coinciding
with maturity or any earlier repurchase or
redemption date) and the total of such amounts.
DTC will confirm the amount payable on each such
Global Security on such Interest Payment Date by
reference to the daily bond reports published by
Standard & Poor's Corporation. The Company will
pay to the Trustee, as paying agent, the total
amount of interest due on such Interest Payment
Date (other than at maturity, redemption or
earlier repayment), and the Trustee will pay
such amount to DTC at the times and in the
manner set forth below. If any Interest Payment
Date for a Fixed Rate Book-Entry Note is not a
Business Day, the payment due on such day shall
be made on the next succeeding Business Day and
no interest shall accrue on such payment for the
period from and after such Interest Payment
Date. If any Interest Payment Date for a
Floating Rate Book-Entry Note (other than the
Maturity Date, a repurchase date or a redemption
date) is not a Business Day, the payment due on
such day shall be made on the next succeeding
Business Day and no interest shall accrue on
such payment for the period from and after such
Interest Payment Date, except that, in the case
of a Book-Entry LIBOR Note, if such Business Day
is in the next calendar month, such Interest
Payment Date shall be the Business Day
immediately preceding the day that would
otherwise have been such
Exhibit B
Page 8
Interest Payment Date with respect to such
Book-Entry LIBOR Note.
On or about the first Business Day of each
month, the Trustee will deliver to the Company
and DTC a written list of principal and interest
to be paid on each Global Security maturing
either at maturity or on a redemption date in
the following month. The Company and DTC will
confirm the amounts of such principal and
interest payments with respect to each such
Global Security on or about the fifth Business
Day preceding the Maturity Date or redemption
date of such Global Security. The Company will
pay to the Trustee, as the paying agent, the
principal amount of such Global Security,
together with interest due at such Maturity Date
or redemption date. The Trustee will pay such
amounts to DTC at the times and in the manner
set forth below. If any Maturity Date or
redemption date of a Global Security
representing a Fixed Rate Book-Entry Note or a
Floating Rate Book-Entry Note is not a Business
Day, the payment due on such day shall be made
on the next succeeding Business Day and no
interest shall accrue on such payment for the
period from and after such Maturity Date or
redemption date. Promptly after payment to DTC
of the principal and interest due on the
Maturity Date or redemption date of such Global
Security, the Trustee will cancel such Global
Security in accordance with the terms of the
Indenture and deliver it to the Company.
The total amount of any principal and interest
due on Global Securities on any Interest Payment
Date or at maturity or upon repurchase or
redemption shall be paid by the Company to the
Trustee in funds available for immediate use by
the Trustee on such date. The Company will make
such payment on such Global Securities by
instructing the Trustee to withdraw funds from
an account maintained by the Company at the
Trustee. The Company will confirm such
instructions in writing to the Trustee. On each
Maturity Date or redemption date or as soon as
possible thereafter, the Trustee will pay by
separate wire transfer (using Fed wire message
entry instructions in a form previously
specified by DTC) to an account at the Federal
Reserve Bank of New York previously specified by
DTC in funds
Exhibit B
Page 9
immediately available on such date, each payment
of interest or principal (together with interest
thereon) due on Global Securities on any
Maturity Date or redemption date. On each
Interest Payment Date, interest payments shall
be made to DTC in same-day funds in accordance
with existing arrangements between the Trustee
and DTC.
Thereafter on each such date, DTC will pay, in
accordance with its SDFS operating procedures
then in effect, such amounts in funds available
for immediate use to the respective Participants
in whose names the Book-Entry Notes represented
by such Global Securities are recorded in the
book-entry system maintained by DTC. Neither the
Company nor the Trustee shall have any
responsibility or liability for the payment by
DTC to such Participants of the principal of and
interest on the Book-Entry Notes.
The amount of any taxes required under
applicable law to be withheld from any interest
payment on a Book-Entry Note will be determined
and withheld by the Participant, indirect
participant in DTC or other person responsible
for forwarding payments directly to the
beneficial owner of such Note.
The Trustee will be responsible for withholding
taxes or interest paid on Notes as required by
applicable law.
Acceptance and Rejection
of Orders: Unless otherwise instructed by the Company, the
Agent will advise the Company promptly by
telephone of all orders to purchase Book-Entry
Notes received by the Agent, other than those
rejected by it in whole or in part in the
reasonable exercise of its discretion. Unless
otherwise agreed by the Company and the Agent,
the Company has the sole right to accept orders
to purchase Book-Entry Notes and may reject any
such orders in whole or in part. Before
accepting any order to purchase a Book-Entry
Note to be settled in less than three Business
Days, the Company shall verify that the Trustee
for such Book-Entry Note will have adequate time
to prepare and authenticate such Note.
Exhibit B
Page 10
Preparation and Delivery of
Pricing Supplement: If any order to purchase a Book-Entry Note is
accepted by or on behalf of the Company, the
Company will prepare a pricing supplement (a
"Pricing Supplement") reflecting the terms of
such Note and will file such Pricing Supplement
with the Commission in accordance with the
applicable paragraph of Rule 424(b) under the
Securities Act of 1933, as amended (the "Act"),
and will deliver the number of copies of such
Pricing Supplement to the Agent as the Agent
shall request by the close of business on the
following Business Day. The Agent will cause
such Pricing Supplement to be delivered to the
purchaser of the Note.
In each instance that a Pricing Supplement is
prepared, the Agent receiving such Pricing
Supplement will affix the Pricing Supplement to
a Prospectus (as defined in the Distribution
Agreement) prior to its use. Outdated Pricing
Supplements will be destroyed.
Suspension of Solicitation;
Amendment or Supplement: Subject to the Company's representations,
warranties and covenants contained in the
Distribution Agreement, the Company may instruct
the Agent to suspend, at any time for any period
of time or permanently, the solicitation of
orders to purchase Book-Entry Notes. Upon
receipt of such instructions, the Agent will
forthwith suspend solicitation until such time
as the Company has advised it that such
solicitation may be resumed.
In the event that at the time the Company
suspends solicitation of purchases there shall
be any orders outstanding for settlement, the
Company will promptly advise the Agent and the
Trustee whether such orders may be settled and
whether copies of the Prospectus as in effect at
the time of the suspension, together with the
appropriate Pricing Supplement, may be delivered
in connection with the settlement of such
orders. The Company will have the sole
responsibility for such decision and for any
arrangements that may be made in the event that
the Company determines that such orders may not
be settled or that copies of such Prospectus may
not be so delivered.
Exhibit B
Page 11
Delivery of Prospectus: A copy of the Prospectus and a Pricing
Supplement relating to a Book-Entry Note must
accompany or precede the earliest of any written
offer of such Book-Entry Note, confirmation of
the purchase of such Book-Entry Note and payment
for such Book-Entry Note by its purchasers. The
Agent will deliver a Prospectus and Pricing
Supplement as herein described with respect to
each Book-Entry Note sold by it. The Company
will make such delivery if such Book-Entry Note
is sold directly by the Company to a purchaser
(other than the Agent).
Confirmation: For each order to purchase a Book-Entry Note
solicited by the Agent and accepted or on behalf
of the Company, the Agent will issue a
confirmation to the purchaser, with a copy to
the Company, setting forth the details set forth
above and delivery and payment instructions.
Settlement: The receipt by the Company of immediately
available funds in payment for a Book-Entry Note
and the authentication and issuance of the
Global Security representing such Note shall
constitute "settlement" with respect to such
Note. All orders accepted by the Company will be
settled on or before the third Business Day next
succeeding the date of acceptance pursuant to
the timetable for settlement set forth below,
unless the Company, the Trustee and the
purchaser agree to settlement on another day.
Settlement Procedures: Settlement Procedures with regard to each
Book-Entry Note sold by the Company to or
through the Agent (except pursuant to a Terms
Agreement, as defined in the Distribution
Agreement) shall be as follows:
A. The Agent will advise the Company by
telephone that such Note is a Book-Entry
Note and of the following settlement
information:
1. Principal amount.
2. Maturity Date.
3. In the case of a Fixed Rate
Book-Entry Note, the Interest
Rate, or, in the case of a
Floating Rate Book-
Exhibit B
Page 12
Entry Note, the Initial Interest
Rate (if known at such time),
Calculation Agent, Base Rate,
Index Maturity, Interest Reset
Period, Interest Reset Dates,
Spread or Spread Multiplier (if
any), Maximum Interest Rate (if
any), redemption, repayment and
extension provisions (if any).
4. The Interest Payment Date(s) and
Interest Payment Period.
5. Redemption and repurchase
provisions, if any.
6. Original Issuance Date.
7. Initial offering price.
8. Agent's commission, if any,
determined as provided in the
Distribution Agreement.
9. Specified currency.
10. Settlement Date.
11. Whether such Book-Entry Note is
an OID Note and, if so, the
total amount of OID, the yield
to maturity and the initial
accrual period OID.
12. Any other applicable Terms.
B. The Company will advise the Trustee by
telephone or electronic transmission
(confirmed in writing at any time on the
same date) of the information set forth
in Settlement Procedure "A" above. The
Company will then assign a CUSIP number
to the Global Security representing such
Note and will notify the Trustee and the
Agent of such CUSIP number by telephone
as soon as practicable.
C. The Trustee will enter a pending deposit
message through DTC's Participant
Terminal System, providing the following
settlement information to DTC, the
Agent,
Exhibit B
Page 13
Standard & Poor's Corporation and
Interactive Data Corporation:
1. The information set forth in
Settlement Procedure "A".
2. The Initial Interest Payment
Date for such Note, the number
of days by which such date
succeeds the related DTC Record
Date (which in the case of
Floating Rate Notes which reset
daily or weekly, shall be the
date five calendar days
immediately preceding the
applicable Interest Payment Date
and, in the case of all other
Notes, shall be the Regular
Record Date as defined in the
Note) and, if known, amount of
interest payable on such initial
Interest Payment Date.
3. The CUSIP number of the Global
Security representing such Note.
4. The numbers of the participants'
accounts maintained by DTC on
behalf of the Trustee and the
Agent.
5. Whether such Global Security
will represent any other
Book-Entry Note (to the extent
known at such time).
D. The Trustee will complete and
authenticate the Global Security
representing such Note.
E. DTC will credit such Note to the
Trustee's participant account at DTC.
F. The Trustee will enter an SDFS deliver
order through DTC's Participant Terminal
System instructing DTC to (i) debit such
Note to the Trustee's participant
account and credit such Note to the
Agent's participant account and (ii)
debit the Agent's settlement account and
credit the Trustee's settlement account
for an amount equal to the price of such
Note less the Agent's commission, if
any. The entry of such a deliver order
shall constitute a representation and
warranty by the Trustee to DTC that (a)
the Global
Exhibit B
Page 14
Security representing such Book-Entry
Note has been issued and authenticated
and (b) the Trustee is holding such
Global Security pursuant to the Medium
Term Note Certificate Agreement between
the Trustee and DTC.
G. Unless the Agent purchased such Note as
principal, the Agent will enter an SDFS
deliver order through DTC's Participant
Terminal System instructing DTC (i) to
debit such Note to the Agent's
participant account and credit such Note
to the participant accounts of the
Participants with respect to such Note
and (ii) to debit the settlement
accounts of such Participants and credit
the settlement account of the Agent for
an amount equal to the price of such
Note.
H. Transfers of funds in accordance with
SDFS deliver orders described in
Settlement Procedures "F" and "G" will
be settled in accordance with SDFS
operating procedures in effect on the
settlement date.
I. The Trustee will credit to the account
of the Company maintained at Chase
Manhattan Bank located in New York, New
York, Account No. ▇▇▇▇-▇▇▇-▇▇▇ (or at
such other account at such other bank in
the United States as the Company may,
from time to time, notify the Agents) in
funds available for immediate use in the
amount transferred to the Trustee in
accordance with Settlement Procedure
"F".
J. Unless the Agent purchased such Note as
principal, the Agent will confirm the
purchase of such Note to the purchaser
either by transmitting to the
Participants with respect to such Note a
confirmation order or orders through
DTC's institutional delivery system or
by mailing a written confirmation to
such purchaser.
K. Monthly, the Trustee will send to the
Company a statement setting forth the
Exhibit B
Page 15
principal amount of Notes Outstanding as
of that date under the Indenture.
Settlement Procedures
Timetable: For sales by the Company of Book-Entry Notes to
or through the Agent (except pursuant to a Terms
Agreement) for settlement on the first Business
Day after the sale date, Settlement Procedures
"A" through "J" set forth above shall be
completed as soon as possible but not later than
the respective times (New York City time) set
forth below:
Settlement
Procedure Time
--------- ----
A 11:00 A.M. on the sale date
B 12:00 Noon on the sale date
C 2:00 P.M. on the sale date
D 9:00 A.M. on settlement date
E 10:00 A.M. on settlement date
F-G 2:00 P.M. on settlement date
H 4:45 P.M. on settlement date
I-J 5:00 P.M. on settlement date
If a sale is to be settled more than one
Business Day after the sale date, Settlement
Procedures "A", "B" and "C" shall be completed
as soon as practicable but no later than 11:00
A.M., 12:00 noon and 2:00 P.M., New York City
time, respectively, on the first Business Day
after the sale date. If the Initial Interest
Rate for a Floating Rate Book-Entry Note has not
been determined at the time that Settlement
Procedure "A" is completed, Settlement Procedure
"B" and "C" shall be completed as soon as such
rate has been determined but no later than 12:00
noon and 2:00 P.M., New York City time,
respectively, on the second Business Day before
the settlement date. Settlement Procedure "H" is
subject to extension in accordance with any
extension of Fedwire closing dead-lines and in
the other events specified in the SDFS operating
procedures in effect on the settlement date.
If settlement of a Book-Entry Note is
rescheduled or canceled, the Trustee, after
receiving notice from the Company or the Agent,
will deliver to DTC, through DTC's Participant
Terminal System, a cancellation message to such
effect by no later than 2:00 P.M., New York City
time, on the Business
Exhibit B
Page 16
Day immediately preceding the scheduled
settlement date.
Procedures upon Company's
Exercise of Optional Reset
or Extension of Maturity: Company Notice to Trustee regarding Exercise of
Optional Reset. Not less than 45 or more than 60
days before an Optional Reset Date as set forth
in a Book-Entry Note, the Company will notify
the Trustee for such Book-Entry Note whether it
is exercising its option to reset the interest
rate or Spread or Spread Multiplier, as the case
may be, for such Book-Entry Note, and if so, (i)
the new interest rate or Spread or Spread
Multiplier, as the case may be, for such
Book-Entry Note during the period from such
Optional Reset Date to the next Optional Reset
Date as set forth in such Book-Entry Note or, if
there is no such next Optional Reset Date, to
the Stated Maturity of such Book-Entry Note (the
"Subsequent Interest Period"); and (ii) the
provisions, if any, for redemption of such
Book-Entry Note during such Subsequent Interest
Period, including the date or dates on which or
the period or periods during which such
redemption may occur during such Subsequent
Interest Period.
Company Notice to Trustee regarding Exercise of
Optional Extension of Maturity. If the Company
elects to exercise an option, as set forth in a
Certificated Note, to extend the Stated Maturity
of such Note, it will so notify the Trustee for
such Book-Entry Note not less than 45 or more
than 60 days before the Stated Maturity of such
Book-Entry Note, and will further indicate (i)
the new Stated Maturity; (ii) the interest rate
or Spread or Spread Multiplier, as the case may
be, applicable to the extension period; and
(iii) the provisions, if any, for redemption of
such Book-Entry Note during such extension
period, including the date or dates on which or
the period or periods during which such
redemption may occur during such extension
period.
Trustee Notice to Holders regarding Company's
Exercise of Optional Extension or Reset. Upon
receipt of notice from the Company regarding the
Company's exercise of either an optional
extension of maturity or an optional reset, the
Trustee for the
Exhibit B
Page 17
Book-Entry Note will mail a notice, first class,
postage prepaid, to the Holder of the Book-Entry
Note not less than 40 days before the Optional
Reset Date (in which case a "Reset Notice") or
the Stated Maturity (in which case an "Extension
Notice"), as the case may be, which Reset Notice
or Extension Notice shall contain the
information required by the terms of the
Book-Entry Note.
Trustee Notice to Company regarding Option to be
Repaid. If, after receipt of either a Reset
Notice or an Extension Notice, the Holder of a
Book-Entry Note exercises the option for
repayment by tendering the Book-Entry Note to be
repaid as set forth in the Book-Entry Note, the
Trustee for such Book Entry Note shall give
notice to the Company not less than 22 days
before the Optional Reset Date or the old Stated
Maturity, as the case may be, of the principal
amount of Book-Entry Notes to be repaid on such
Optional Reset Date or old Stated Maturity, as
the case may be.
Company Notice regarding New Interest Rate or
New Spread or Spread Multiplier. If the Company
elects to revoke the interest rate or Spread or
Spread Multiplier and establish a higher
interest rate or Spread or Spread Multiplier for
an Optional Reset Period or extension period, as
the case may be, it shall, not less than 20 days
before such Optional Reset Date or old Stated
Maturity, so notify the Trustee for the affected
Book-Entry Note. The Trustee will immediately
thereafter notify the Holder of such Book-Entry
Note, by first class mail, postage prepaid, of
the new higher interest rate or Spread or Spread
Multiplier applicable to such Book-Entry Note.
Trustee Notice to Company regarding Holder
Revocation of Option to be Repaid. If, after the
Holder of a Book-Entry Note has tendered such
Note for repayment pursuant to an Extension
Notice or a Reset Notice, such Holder revokes
such tender for repayment, the Trustee for such
Book-Entry Note shall give notice to the Company
not less than five days prior to the Stated
Maturity or Optional Reset Date, as the case may
be, of such revocation and of the principal
amount of Book-Entry Notes for which tender for
repayment has been revoked.
Exhibit B
Page 18
Deposit of Repayment Price. On or before any old
Stated Maturity where the Maturity has been
extended, and on or before any Optional Reset
Date, the Company shall deposit with such
Trustee an amount of money sufficient to pay the
principal amount, plus interest accrued to such
old Stated Maturity or Optional Reset Date, as
the case may be, for all the Book-Entry Notes or
portions thereof for which such Trustee serves
as Trustee and which are to be repaid on such
old Stated Maturity or Optional Reset Date, as
the case may be. Such Trustee will use such
money to repay such Book-Entry Notes pursuant to
the terms set forth in such Notes.
Procedures upon Company's
Exercise of Optional
Redemption: Company Notice to Trustee regarding Exercise of
Optional Redemption. At least 45 days prior to
the date on which it intends to redeem a
Book-Entry Note, the Company will notify the
Trustee for such Book-Entry Note that it is
exercising such option with respect to such Note
on such date.
Trustee Notice to Holders regarding Company's
Exercise of Optional Redemption. After receipt
of notice that the Company is exercising its
option to redeem a Book-Entry Note, the Trustee
for such Book-Entry Note will, at least 30 days
before the Redemption Date for such Book-Entry
Note, mail a notice, first class, postage
prepaid, to the Holder of such Book-Entry Note,
informing such Holder of the Company's exercise
of such option with respect to such Book-Entry
Note.
Payments of Principal and
Interest Upon Exercise of
Optional Repayment (Except
Pursuant to Company's
Exercise of Optional Reset
or Optional Extension): Trustee notice to Company of Option to be
Repaid. Upon receipt of notice of exercise of
the option for repayment and the Book-Entry
Notes to be repaid as set forth in such Notes,
the Trustee for such Book-Entry Notes shall
(unless such notice was received pursuant to the
Company's exercise of an optional reset or an
optional extension of maturity, in each of which
cases the relevant procedures set
Exhibit B
Page 19
forth above shall be followed) give notice to
the Company not less than 20 days prior to each
Optional Repayment Date of such Optional
Repayment Date and of the principal amount of
Book-Entry Notes to be repaid on such Optional
Repayment Date.
Failure to Settle: If the Trustee fails to enter an SDFS deliver
order with respect to a Book-Entry Note pursuant
to Settlement Procedure "F", upon written
direction from the Company, the Trustee may
deliver to DTC, through DTC's Participant
Terminal System, as soon as practicable a
withdrawal message instructing DTC to debit such
Note to the Trustee's participant account,
provided that the Trustee's participant account
contains a principal amount of the Global
Security representing such Note that is at least
equal to the principal amount to be debited. If
a withdrawal message is processed with respect
to all the Book-Entry Notes represented by a
Global Security, the Trustee will mark such
Global Security "canceled", make appropriate
entries in the Trustee's records and send such
canceled Global Security to the Company. The
CUSIP number assigned to such Global Security
shall, in accordance with CUSIP Service Bureau
procedures, be canceled and not immediately
reassigned. If a withdrawal message is processed
with respect to one or more, but not all, of the
Book-Entry Notes represented by a Global
Security, the Trustee will exchange such Global
Security for two Global Securities, one of which
shall represent such Book-Entry Note or Notes
and shall be canceled immediately after issuance
and the other of which shall represent the
remaining Book-Entry Notes previously
represented by the surrendered Global Security
and shall bear the CUSIP number of the
surrendered Global Security.
If the purchase price for any Book-Entry Note is
not timely paid to the Participants with respect
to such Note by the beneficial purchaser thereof
(or a person, including an indirect participant
in DTC, acting on behalf of such purchaser),
such Participants and, in turn, the Agent may
enter SDFS deliver orders through DTC's
Participant Terminal System reversing the orders
entered pursuant to Settlement Procedures "F"
and "G", respectively.
Exhibit B
Page 20
Thereafter, the Trustee will deliver the
withdrawal message and take the related actions
described in the preceding paragraph.
Notwithstanding the foregoing, upon any failure
to settle with respect to a Book-Entry Note, DTC
may take any actions in accordance with its SDFS
operating procedures then in effect.
In the event of a failure to settle with respect
to one or more, but not all, of the Book-Entry
Notes to have been represented by a Global
Security, the Trustee will provide, in
accordance with Settlement Procedures "D" and
"F", for the authentication and issuance of a
Global Security representing the Book-Entry
Notes to be represented by such Global Security
and will make appropriate entries in its
records.
Risk of Funds by Trustee: Nothing herein shall be deemed to require the
Trustee to risk or expend its own funds in
connection with any payments to the Company, the
Agents or DTC or any holder, it being understood
by all parties that payments made by the Trustee
to the Company or the Agents, or DTC, or any
holder shall be made only to the extent that
funds are provided to the Trustee for such
purpose.
Exhibit B
Page 21
PART II: ADMINISTRATIVE PROCEDURES FOR CERTIFICATED NOTES
Issuance: Each Note will be dated and issued as of the
date of its authentication by the Trustee. Each
Note will bear an Original Issue Date, which
will be (i) with respect to an Original Note (or
any portion thereof), its original issuance date
(which will be the settlement date) and (ii)
with respect to any Note (or portion thereof)
issued subsequently upon transfer or exchange of
a Note or in lieu of a destroyed, lost or stolen
Note, the original issuance date of the
predecessor Note, regardless of the date of
authentication of such subsequently issued Note.
Unless otherwise provided in the Pricing
Supplement, the principal of and interest on the
Notes will be payable in U.S. dollars only.
Registration: Notes will be issued only in fully registered
form without coupons.
Transfers and Exchanges: A Note may be presented for transfer or exchange
at the principal corporate trust office of the
Trustee in the City of New York. Notes will be
exchangeable for other Notes having identical
terms but different denominations without
service charge. Notes will not be exchangeable
for Book-Entry Notes.
Maturities: Each Note will mature on a date nine months or
more from its date of issue.
Denomination: Unless otherwise specified in the applicable
Pricing Supplement, the denomination of any Note
will be a minimum of $1,000 or any amount in
excess thereof that is an integral multiple of
$1,000.
Interest: General. Interest on each Note will accrue from
and including the Original Issue Date of such
Note for the first interest period and from and
including the most recent date to which interest
has been paid for all subsequent interest
periods. Each payment of interest on a Note will
include interest accrued to but excluding the
Interest Payment Date; provided that in the case
of Floating Rate Notes which reset daily or
weekly, interest payment will include interest
accrued to and including the Regular Record Date
immediately preceding the Interest Payment Date,
except that at maturity or earlier repurchase or
redemption, the interest payable will
Exhibit B
Page 22
include interest accrued to, but excluding, the
Maturity Date or the date of repurchase or
redemption, as the case may be (other than a
maturity of a Fixed Rate Certificated Note
occurring on the 31st day of a month, in which
case such payment of interest will include
interest accrued to but excluding the 30th day
of such month).
Fixed Rate Notes. Unless otherwise specified
pursuant to Settlement Procedure "A" below,
interest payments on Fixed Rate Notes, will be
made semi-annually on March 15 and September 15
of each year and at maturity or upon any earlier
repurchase or redemption; provided, however,
that if an Interest Payment Date for a Fixed
Rate Note would otherwise be a day that is not a
Business Day, the payment due on such day shall
be made on the next succeeding Business Day and
no interest shall accrue on such payment from
and after such Interest Payment Date; and
provided, further, that in the case of Fixed
Rate Notes issued between a Regular Record Date
and an Interest Payment Date, the first interest
payment will be made on the Interest Payment
Date following the next succeeding Regular
Record Date.
Floating Rate Notes. Interest payments will be
made on Floating Rate Notes weekly, monthly,
quarterly, semiannually or annually. Interest
will be payable, in the case of Floating Rate
Notes with a daily, weekly or monthly Interest
Reset Date, on the Wednesday of each week (or
Tuesday in the case of Floating Rate Book-Entry
Notes as to which the Treasury Rate is an
applicable interest rate basis), or the third
Wednesday of each month, respectively, as
specified pursuant to Settlement Procedure "A"
below; in the case of Notes with a quarterly
Interest Reset Date, on the third Wednesday of
March, June, September and December of each
year; in the case of Notes with a semi-annual
Interest Reset Date, on the third Wednesday of
the two months of each year specified pursuant
to Settlement Procedure "A" below; and in the
case of Notes with an annual Interest Reset
Date, on the third Wednesday of the month of
each year specified pursuant to Settlement
Procedure "A" below; provided, however, that if
an Interest Payment Date for Floating Rate Notes
Exhibit B
Page 23
(other than the Maturity Date, a repurchase date
or a redemption date) would otherwise be a day
that is not a Business Day, such Interest
Payment Date will be the next succeeding
Business Day, except that in the case of a LIBOR
Note, if such Business Day is in the next
succeeding calendar month, such Interest Payment
Date will be the Business Day immediately
preceding such day that would have otherwise
been such Interest Payment Date; and provided,
further, that in the case of a Floating Rate
Note issued between a Regular Record Date and an
Interest Payment Date, the first interest
payment will be made on the Interest Payment
Date following the next succeeding Regular
Record Date.
Calculation of Interest: Fixed Rate Notes. Unless otherwise specified in
a Pricing Supplement, interest on Fixed Rate
Notes (including interest for partial periods)
will be calculated on the basis of a year of
twelve thirty-day months.
Floating Rate Notes. Interest rates on Floating
Rate Notes will be determined as set forth in
the form of such Notes. Unless otherwise
specified in a Pricing Supplement, interest on
Floating Rate Notes will be calculated on the
basis of actual days elapsed and a year of 360
days except that in the case of Treasury Rate
Notes or CMT Rate Notes, interest will be
calculated on the basis of the actual number of
days in the year.
Payments of Principal
and Interest: The Trustee will pay the principal amount and
premium, if any, of each Note at maturity or
upon repurchase or redemption or upon
presentation and surrender of such Note to the
Trustee. Such payment, together with payment of
interest due at maturity of such Note, will be
made in funds available for immediate use by the
Trustee and in turn by the holder of such Note
by check or, at the option of the holder, by
wire transfer of immediately available funds if
appropriate wire transfer instructions have been
received by the Trustee not later than the 10
calendar days prior to the Maturity Date or
redemption date. Notes presented to the Trustee
at maturity or upon repurchase or redemption for
payment will be canceled by the Trustee and
delivered to the Company with a certificate of
cancellation. All
Exhibit B
Page 24
interest payments in U.S. dollars on a Note
(other than interest due at maturity or upon
repurchase or redemption) will be made by check
drawn on the Trustee (or another Person
appointed by the Trustee) and mailed by the
Trustee to the Person entitled thereto as
provided in such Note and the Indenture;
provided, however, that the holder of (or the
equivalent thereof in another currency or
composite currency) $10,000,000 or more of Notes
having the identical terms and provisions will
be entitled to receive payment by wire transfer
of immediately available funds if appropriate
wire transfer instructions have been received by
the Trustee not later than the Regular Record
Date applicable to such Interest Payment Date.
Interest payments on Notes in a Specified
Currency other than U.S. dollars will be made by
check or, at the option of the holder of the
Note, by wire transfer of immediately available
funds if appropriate wire transfer instructions
have been received by the Trustee not later than
the Regular Record Date applicable to such
Interest Payment Date. Following each Regular
Record Date, the Trustee will furnish the
Company with a list of interest payments to be
made on the following Interest Payment Date for
each Note and in total for all Notes. Interest
at maturity will be payable to the person to
whom the payment of principal is payable. The
Trustee will provide monthly to the Company
lists of principal and interest to be paid on
Notes maturing in the next month. The Trustee
will be responsible for withholding taxes on
interest paid on Notes as required by applicable
law.
If any Interest Payment Date or the Maturity
Date or redemption date of a Fixed Rate Note is
not a Business Day, the payment due on such day
shall be made on the next succeeding Business
Day and no interest shall accrue on such payment
for the period from and after such Interest
Payment Date, Maturity Date or redemption date,
as the case may be. If any Interest Payment
Date, other than the Maturity Date, a repurchase
date or redemption date, for any Floating Rate
Note would fall on a day that is not a Business
Day, such Interest Payment Date will be the
following day that is a Business Day with
respect to such Note, and interest shall accrue
to, but not including, such next succeeding
Business
Exhibit B
Page 25
Day except that, in the case of a LIBOR Note, if
such Business Day is in the next succeeding
calendar month, such Interest Payment Date shall
be the Business Day immediately preceding the
day that would otherwise have been such Interest
Payment Date with respect to such LIBOR Note. If
the Maturity Date or redemption date for any
Floating Rate Note falls on a day that is not a
Business Day, payment of principal, premium, if
any, and interest with respect to such Floating
Rate Note shall be made on the next succeeding
Business Day with the same force and effect as
if made on the due date, and no interest shall
accrue to such next succeeding Business Day.
Acceptance and Rejection
of Orders: Unless otherwise instructed by the Company, the
Agent will advise the Company promptly by
telephone of all orders to purchase Certificated
Notes received by the Agent, other than those
rejected by it in whole or in part in the
reasonable exercise of its discretion. Unless
otherwise agreed by the Company and the Agent,
the Company has the sole right to accept orders
to purchase Certificated Notes and may reject
any such orders in whole or in part. Before
accepting any order to purchase a Certificated
Note to be settled in less than three Business
Days, the Company shall verify that the Trustee
for such Certificated Note will have adequate
time to prepare and authenticate such Note.
Preparation and Delivery
of Pricing Supplement: If any order to purchase a Note is accepted by
or on behalf of the Company, the Company will
prepare a pricing supplement (a "Pricing
Supplement") reflecting the terms of such Note
and will file such Pricing Supplement with the
Commission, in accordance with the applicable
paragraph of Rule 424(b) under the Act, and will
deliver the number of copies of such Pricing
Supplement to the Agent which solicited such
offer to purchase as such Agent shall request by
the close of business on the following Business
Day. Such Agent will cause such Pricing
Supplement to be delivered to the purchaser of
the Note.
In each instance that a Pricing Supplement is
prepared, such Agent will affix the Pricing
Exhibit B
Page 26
Supplement to a Prospectus prior to its use.
Outdated Pricing Supplements will be destroyed.
Suspension of Solicitation;
Amendment or Supplement: Subject to the Company's representations,
warranties and covenants contained in the
Distribution Agreement, the Company may instruct
the Agent to suspend, at any time for any period
of time or permanently, the solicitation of
orders to purchase Certificated Notes. Upon
receipt of such instructions, the Agent will
forthwith suspend solicitation until such time
as the Company has advised it that such
solicitation may be resumed.
In the event that at the time the Company
suspends solicitation of purchases there shall
be any orders outstanding for settlement, the
Company will promptly advise the Agent and the
Trustee whether such orders may be settled and
whether copies of the Prospectus as in effect at
the time of the suspension, together with the
appropriate Pricing Settlement, may be delivered
in connection with the settlement of such
orders. The Company will have the sole
responsibility for such decision and for any
arrangements that may be made in the event that
the Company determines that such orders may not
be settled or that copies of such Prospectus may
not be so delivered.
Delivery of Prospectus: A copy of the Prospectus and a Pricing
supplement relating to a Certificated Note must
accompany or precede the earliest of any written
offer of such Certificated Note, confirmation of
the purchase of such Certificated Note and
payment for such Certificated Note by its
purchaser. The Agent will deliver a Prospectus
and Pricing Supplement as herein described with
respect to each Certificated Note sold by it.
The Company will make such delivery if such
Certificated Note is sold directly by the
Company to a purchaser (other than the Agent).
Confirmation: For each order to purchase a Certificated Note
solicited by the Agent and accepted by or on
behalf of the Company, the Agent will issue a
confirmation to the purchaser, with a copy to
the Company, setting forth the details set forth
above and delivery and payment instructions.
Exhibit B
Page 27
Settlement: The receipt by the Company of immediately
available funds in exchange for an authenticated
Note delivered to the Agent which solicited such
offer to purchase and such Agent's delivery of
such Note against receipt of immediately
available funds shall constitute "settlement"
with respect to such Note. All orders accepted
by the Company will be settled on or before the
third Business Day next succeeding the date of
acceptance pursuant to the timetable for
settlement set forth below, unless the Company,
the Trustee and the purchaser agree to
settlement on another date.
Settlement Procedures: Settlement Procedures with regard to each Note
sold by the Company to or through an Agent
(except pursuant to a Terms Agreement) shall be
as follows:
A. The Agent which solicited such offer to
purchase will advise the Company by
telephone of the following settlement
information:
1. Name in which such Note is to be
registered ("Registered Owner").
2. Address of the Registered Owner
and address for payment of
principal and interest.
3. Taxpayer identification number
of the Registered Owner (if
available).
4. Principal amount.
5. Maturity Date.
6. In the case of a Fixed Rate
Note, the Interest Rate, or, in
the case of a Floating Rate
Note, the Initial Interest Rate
(if known at such time),
Calculation Agent, Base Rate,
Index Maturity, Interest Reset
Period, Interest Reset Dates,
Spread or Spread Multiplier (if
any), Minimum Interest Rate (if
any), Maximum Interest Rate (if
any), redemption, repayment and
extension provisions (if any).
Exhibit B
Page 28
7. The Interest Payment Date(s) and
Interest Payment Period.
8. Redemption or repurchase
provisions, if any.
9. Original issuance date.
10. Initial Offering price.
11. Agent's commission, if any,
determined as provided in the
Distribution Agreement between
the Company and such Agent.
12. Denominations.
13. If applicable, wire transfer
instructions, including name of
banking institution where
transfer is to be made and
account number.
14. Specified currency.
15. Settlement Date.
16. Whether such Certificated Note
is an OID) Note and, if so, the
total amount of OID, the yield
to maturity and the initial
accrual period OID.
17. Any other applicable terms.
B. The Company will advise the Trustee by
telephone or electronic transmission
(confirmed in writing at any time on the
sale date) of the information set forth
in Settlement Procedure "A" above.
C. The Company will have delivered to the
Trustee a pre-printed four-ply packet
for such Note, which packet will contain
the following documents in forms that
have been approved by the Company, such
Agent and the Trustee:
1. Note with customer confirmation.
2. Stub One - For the Agent.
Exhibit B
Page 29
3. Stub Two - For such Trustee.
4. Stub Three - For the Company.
D. The Trustee will complete such Note and
authenticate such Note and deliver it
(with the confirmation) and Stubs One
and Two to such Agent, and such Agent
will acknowledge receipt of the Note by
stamping or otherwise marking Stub Two
and returning it to the Trustee. Such
delivery will be made only against such
acknowledgment of receipt and evidence
that instructions have been given by
such Agent for payment to the account of
the Company at Chase Manhattan Bank
located in New York, New York, Account
No. ▇▇▇▇-▇▇▇-▇▇▇ (or at such other
account at such other bank in the United
States as the Company may, from time to
time, notify the Agents), in funds
available for immediate use, of an
amount equal to the price of such Note
less such Agent's commission, if any. In
the event that the instructions given by
such Agent for payment to the account of
the Company are revoked, the Company
will as promptly as possible wire
transfer to the account of such Agent an
amount of immediately available funds
equal to the amount of such payment
made.
E. Unless such Agent purchased such Note as
principal, such Agent will deliver such
Note (with confirmation) to the customer
against payment in immediately available
funds. Such Agent will obtain the
acknowledgment of receipt of such Note
by retaining Stub One.
F. The trustee will send Stub Three to the
Company by first-class mail.
Periodically, the Trustee will also send
to the Company a statement setting forth
the principal amount of the Notes
Outstanding as of that date under the
Indenture.
Exhibit B
Page 30
Settlement Procedures
Timetable: For sales by the Company of Notes to or through
an Agent (except pursuant to a Terms Agreement),
Settlement Procedures "A" through "F" set forth
above shall be completed on or before the
respective times (New York City time) set forth
below:
Settlement
Procedure Time
A 2:00 P.M. on the second Business
Day before settlement date
B 3:00 P.M. on the second Business
Day before settlement date
C-D 2:15 P.M. on settlement date
E 3:00 P.M. on settlement date
F 5:00 P.M. on settlement date
Procedures upon Company's
Exercise of Optional Reset
or Extension of Maturity: Company Notice to Trustee regarding Exercise of
Optional Reset. Not less than 45 or more than 60
days before an Optional Reset Date as set forth
in a Certificated Note, the Company will notify
the Trustee for such Certificated Note whether
it is exercising its option to reset the
interest rate or Spread or Spread Multiplier, as
the case may be, for such Certificated Note, and
if so, (i) the new interest rate or Spread or
Spread Multiplier, as the case may be, for such
Certificated Note during the period from such
Optional Reset Date to the next Optional Reset
Date as set forth in such Certificated Note or,
if there is no such next Optional Reset Date, to
the Stated Maturity of such Certificated Note
(the "Subsequent Interest Period"); and (ii) the
provisions, if any, for redemption of such
Certificated Note during such Subsequent
Interest Period, including the date or dates on
which or the period or periods during which such
redemption may occur during such Subsequent
Interest Period.
Company Notice to Trustee regarding Exercise of
Optional Extension of Maturity. If the Company
elects to exercise an option, as set forth in a
Exhibit B
Page 31
Certificated Note, to extend the Stated Maturity
of such Note, it will so notify the Trustee for
such Certificated Note not less than 45 or more
than 60 days before the Stated Maturity of such
Certificated Note, and will further indicate (i)
the new Stated Maturity; (ii) the interest rate
or Spread or Spread Multiplier, as the case may
be, applicable to the extension period; and
(iii) the provisions, if any, for redemption of
such Certificated Note during such extension
period, including the date or dates on which or
the period or periods during which such
redemption may occur during such extension
period.
Trustee Notice to Holders regarding Company's
Exercise of Optional Extension or Reset. Upon
receipt of notice from the Company regarding the
Company's exercise of either an optional
extension of maturity or an optional reset, the
Trustee for the Certificated Note will mail a
notice, first class, postage prepaid, to the
Holder of the Certificated Note not less than 40
days before the Optional Reset Date (in which
case a "Reset Notice") or the Stated Maturity
(in which case an "Extension Notice"), as the
case may be, which Reset Notice or Extension
Notice shall contain the information required by
the terms of the Certificated Note.
Trustee Notice to Company regarding Option to be
Repaid. If, after receipt of either a Reset
Notice or an Extension Notice, any Holder of a
Certificated Note exercises the option for
repayment by tendering the Certificated Note to
be repaid as set forth in the Certificated Note,
the Trustee for such Certificated Note shall
give notice to the Company not less than 22 days
before the Optional Reset Date or the old Stated
Maturity, as the case may be, of the principal
amount of Certificated Notes to be repaid on
such Optional Reset Date or old Stated Maturity,
as the case may be.
Company Notice regarding New Interest Rate or
New Spread or Spread Multiplier. If the Company
elects to revoke the interest rate or Spread or
Spread Multiplier and establish a higher
interest rate or Spread or Spread Multiplier for
an Optional Reset Period or extension period, as
the case may be, it shall, not less than 20 days
before such Optional
Exhibit B
Page 32
Reset Date or old Stated Maturity, so notify the
Trustee for the affected Certificated Note. The
Trustee will immediately thereafter notify the
Holder of such Certificated Note, by first class
mail, postage prepaid, of the new higher
interest rate or Spread or Spread Multiplier
applicable to such Certificated Note.
Trustee Notice to Company regarding Holder
Revocation of Option to be Repaid. If, after the
Holder of a Certificated Note has tendered such
Note for repayment pursuant to an Extension
Notice or a Reset notice, such Holder revokes
such tender for repayment, the Trustee for such
Certificated Note shall give notice to the
Company not less than five days prior to the
Stated Maturity or Optional Reset Date, as the
case may be, of such revocation and of the
principal amount of Certificated Notes for which
tender for repayment has been revoked.
Deposit of Repayment Price. On or before any old
Stated Maturity where the Maturity has been
extended, and on or before any Optional Reset
Date, the Company shall deposit with such
Trustee an amount of money sufficient to pay the
principal amount, plus interest accrued to such
old Stated Maturity or Optional Reset Date, as
the case may be, for all the Certificated Notes
or portions thereof for which such Trustee
serves as Trustee and which are to be repaid on
such old Stated Maturity or Optional Reset Date,
as the case may be. Such Trustee will use such
money to repay such Certificated Notes pursuant
to the terms set forth in such Notes.
Procedures upon Company's
Exercise of Optional
Redemption: Company Notice to Trustee regarding Exercise of
Optional Redemption. At least 45 days prior to
the date on which it intends to redeem a
Certificated Note, the Company will notify the
Trustee for such Certificated Note that it is
exercising such option with respect to such Note
on such date.
Trustee Notice to Holders regarding Company's
Exercise of Optional Redemption. After receipt
of notice that the Company is exercising its
option to redeem a Certificated Note, the
Trustee for such Certificated Note will, at
least 30 days before the
Exhibit B
Page 33
Redemption Date for such Certificated Note, mail
a notice, first class, postage prepaid, to the
Holder of such Certificated Note, informing such
Holder of the Company's exercise of such option
with respect to such Certificated Note.
Payments of Principal and
Interest Upon Exercise of
Optional Repayment (Except
Pursuant to Company's
Exercise of Optional Reset
or Optional Extension): Trustee notice to Company of Option to be
Repaid. Upon receipt of notice of exercise of
the option for repayment and the Certificated
Notes to be repaid as set forth in such Notes,
the Trustee for such Certificated Notes shall
(unless such notice was received pursuant to the
Company's exercise of an optional reset or an
optional extension of maturity, in each of which
cases the relevant procedures set forth above
shall be followed) give notice to the Company
not less than 20 days prior to each Optional
Repayment Date of such Optional Repayment Date
of such Optional Repayment Date and of the
principal amount of Certificated Notes to be
repaid on such Optional Repayment Date.
Failure to Settle: If a purchaser fails to accept delivery of or
make payment for any Note, the Agent which
solicited the offer to purchase such Note will
notify the Company and the Trustee by telephone
and return such Note to the Trustee. Upon
receipt of such notice, the Company will
immediately wire transfer to the account of such
Agent an amount equal to the amount previously
credited thereto in respect of such Note. Such
wire transfer will be made on the settlement
date, if possible, and in any event not later
than the Business Day following the settlement
date. If the failure shall have occurred for any
reason other than a default by such Agent in the
performance of its obligations hereunder and
under the Distribution Agreement with the
Company, then the Company will reimburse the
Agent or the Trustee, as appropriate, on an
equitable basis for its loss of the use of the
funds during the period when they were credited
to the account of the Company. Immediately upon
receipt of the Note in respect of which such
failure occurred, the Trustee will mark such
Note "canceled", make appropriate entries in
Exhibit B
Page 34
the Trustee's records and send such Note to the
Company.
Risk of Funds by Trustee: Nothing herein shall be deemed to require the
Trustee to risk or expend its own funds in
connection with any payments to the Company, the
Agents or any purchaser, it being understood by
all parties that payments made by the Trustee to
the Company or the Agents or any purchaser shall
be made only to the extent that funds are
provided to the Trustee for such purpose.
