Xxx Xxxxxxxx Xxxxxxx
Floating Rate Notes due 2043
TERMS AGREEMENT
March 26, 2003
Xxx Xxxxxxxx Xxxxxxx
Prudential Xxxxx Xxxxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention:
Subject in all respects to the terms and conditions of the Distribution
Agreement, dated August 23, 2002, between Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated and you (the "Agreement"), the undersigned (collectively, the
"Underwriters") severally agree to purchase the respective principal amount of
the Floating Rate Notes due 2043 (the "Notes") of Xxx Xxxxxxxx Xxxxxxx (the
"Company") set forth opposite each such Underwriter's name in Annex B of this
Agreement.
The Company hereby appoints Xxxxxx Xxxxxxx & Co. Incorporated and UBS
Warburg LLC (the "Additional Agents") as Agents under the Agreement in
connection with the purchase as principal by each of them, in the respective
amounts set forth on Annex B hereto, of the Notes, and Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated agrees to such appointment. The Company agrees that,
solely with respect to the Notes, each Additional Agent shall be an "Agent" for
all purposes of the Agreement and shall be entitled to all rights and interests
and subject to all obligations and liabilities of an Agent thereunder, to the
same extent as if each Additional Agent were a named Agent thereunder, including
the benefit of the representations and warranties, agreements and indemnities
(including contribution) by the Company in favor of the Agents set forth in the
Agreement.
THE NOTES
Aggregate Principal Amount: $83,000,000
Issue Price: 100% of Principal Amount plus accrued interest, if any,
from Xxxxx 0, 0000
Xxxxxxxx Price: 99% of Principal Amount
Method of Determining Interest Rate: Three-Month LIBOR, reset quarterly, minus 0.30%,
accruing from April 2, 2003
January 2, April 2, July 2 and October 2 of each
Interest Payment Dates: year, commencing July 2, 2003
Date of Maturity: April 2, 2043
Redemption Provisions: In whole or in part, at the option of the
Company, on or after April 2, 2033 at the
redemption prices specified in the form of
Pricing Supplement attached hereto as Annex A
plus accrued interest thereon
Repayment Provisions: Beginning April 2, 2004, in whole or in part, at
the option of holders of the Notes, on April 2 of
every year through 2014 and every third year
thereafter at the repayment prices specified in
the form of Pricing Supplement attached hereto as
Annex A plus accrued interest thereon
Survivor's Option: The Notes are not subject to the Survivor's
Option.
Closing Date: April 2, 2003
Method of Payment: Immediately available funds
Trustee, Paying Agent
and Authenticating Agent: Bank One, N.A.
Calculation Agent: Bank One, N.A.
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Documentation Requirements: Each of the documents specified
in Sections 5(b)(1), (c) and (d)
of the Agreement shall be dated
as of, and delivered to the
undersigned on, the Closing
Date
Other terms: The Notes shall have such
additional terms as are
specified in the form of
Pricing Supplement attached
hereto as Annex A
Allocation among Each of the Underwriters
Underwriters: severally agrees to purchase
the respective principal amount
of Notes set forth next to its
name in Annex B attached hereto
Default of Underwriters: The provisions set forth in Annex C attached
hereto are incorporated herein
by reference
This Agreement may be executed in one or more counterparts and, if
executed in more than one counterpart, the executed counterparts hereof shall
constitute a single instrument.
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XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
XXXXXX XXXXXXX & CO. INCORPORATED
UBS WARBURG LLC
By: Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
By: /s/ Xxxxx Xxxxxxxx
------------------------------------------
Authorized Signatory
Confirmed and Accepted,
as of the date first above written:
XXX XXXXXXXX XXXXXXX
By: /s/ Xxxx X. Xxxxxxxx
----------------------------
Name: Xxxx X. Xxxxxxxx
Title: Vice President and Treasurer
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ANNEX A
[Pricing Supplement]
ANNEX B
UNDERWRITER PRINCIPAL AMOUNT
----------- ----------------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated ......................... $ 25,000,000
Xxxxxx Xxxxxxx & Co Incorporated .......................... 33,000,000
UBS Warburg LLC ........................................... 25,000,000
-------------
Total ............................................ $ 83,000,000
ANNEX C
If any Underwriter or Underwriters default in their obligations to
purchase Notes agreed to be purchased by such Underwriter or Underwriters
hereunder and the aggregate principal amount of Notes which such defaulting
Underwriter or Underwriters agreed but failed to purchase does not exceed 10% of
the total principal amount of Notes, the Underwriters may make arrangements
satisfactory to the Company for the purchase of such Notes by other persons,
including any of the Underwriters, but if no such arrangements are made by the
Closing Date, the nondefaulting Underwriters shall be obligated severally, in
proportion to their respective commitments hereunder (or in such other
proportions as the non-defaulting Underwriters may agree) to purchase the Notes
which such defaulting Underwriters agreed but failed to purchase. If any
Underwriter or Underwriters so default and the aggregate principal amount of
Notes with respect to which such default or defaults occur exceeds 10% of the
total principal amount of Notes and arrangements satisfactory to the
Underwriters and the Company for the purchase of such Notes by other persons are
not made within 36 hours after such default, this Terms Agreement will terminate
without liability on the part of any nondefaulting Underwriter or the Company.
As used herein, the term "Underwriter" includes any person substituted for a
Underwriter under the terms of this paragraph. Nothing herein will relieve a
defaulting Underwriter from liability for its default.
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