Exhibit 1.2
XXX XXXXXXXX XXXXXXX
XXXXXXXX XXXXXXXXX(SM)
DUE NINE MONTHS OR MORE FROM THE DATE OF ISSUE
DISTRIBUTION AGREEMENT
August 23, 2002
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
4 World Financial Center, Floor 00
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
Xxx Xxxxxxxx Xxxxxxx, a Delaware corporation (the "Company"), confirms
its agreement with Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated (the
"Agent") with respect to the issue and sale from time to time by the Company of
its Xxxxxxxx CoreNotesSM Due Nine Months or More From the Date of Issue (the
"Notes"). The Notes are to be issued pursuant to an Indenture, dated as of April
11, 2002, as supplemented by that certain Second Supplemental Indenture, dated
as of August 23, 2002, and as further amended or supplemented from time to time
hereafter (collectively, the "Indenture"), between the Company and Bank One,
N.A., as trustee (the "Trustee"). The Notes shall have the maturity ranges,
interest rates and other terms set forth in the Prospectus (as defined below).
As of the date hereof, the Company has authorized the issuance and sale of up to
U.S.$500,000,000 aggregate initial offering price of Notes to or through the
Agent pursuant to the terms of this Agreement. It is understood, however, that
the Company may from time to time authorize the issuance of additional Notes and
that such additional Notes may be sold to or through the Agent pursuant to the
terms of this Agreement, all as though the issuance of such Notes were
authorized as of the date hereof.
This Agreement specifies terms and conditions on which Notes may be
sold by the Company (i) to the Agent as principal for resale and (ii) directly
to investors through the Agent as an agent of the Company in soliciting offers
for the purchase of Notes.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-86336) and
pre-effective amendments nos. 1 and 2 thereto for the registration of debt
securities, including the Notes, under the Securities Act of 1933, as amended
(the "1933 Act"), and the offering thereof from time to time in accordance with
Rule 415 of the rules and regulations of the Commission under the 1933 Act (the
"1933 Act Regulations"). Such registration statement has been declared effective
by the Commission and the Indenture has been duly qualified under the Trust
Indenture Act of 1939, as amended (the "1939 Act"), and the Company has filed
such post-effective amendments thereto as may be required prior to its
acceptance of any offer for the purchase of Notes and each such post-effective
amendment has been declared effective by the Commission.
"CoreNotes(SM)" is a service mark of Xxxxxxx Xxxxx & Co., Inc.
Such registration statement (as so amended, if applicable) is referred to herein
as the "Registration Statement"; and the final prospectus and all applicable
amendments or supplements thereto (including the final prospectus supplement and
pricing supplement relating to the offering of Notes), in the form most recently
furnished to the Agent for use in confirming sales of Notes, are collectively
referred to herein as the "Prospectus"; provided, however, that all references
to the "Registration Statement" and the "Prospectus" shall also be deemed to
include all documents incorporated therein by reference pursuant to the
Securities Exchange Act of 1934, as amended (the "1934 Act"), prior to any
acceptance by the Company of an offer for the purchase of Notes; provided,
further, that if the Company files a registration statement with the Commission
pursuant to Rule 462(b) of the 1933 Act Regulations (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. A "preliminary prospectus" shall be deemed to refer to
any prospectus furnished by the Company after the Registration Statement became
effective and before any acceptance by the Company of an offer for the purchase
of Notes which omitted information to be included upon pricing in a form of
prospectus filed with the Commission pursuant to Rule 424(b) of the 1933 Act
Regulations. For purposes of this Agreement, all references to the Registration
Statement, Prospectus or preliminary prospectus or to any amendment or
supplement thereto shall be deemed to include any copy thereof filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval
system ("XXXXX").
All references in this Agreement to financial statements and schedules
and other information which is "disclosed", "contained," "included" or "stated"
(or other references of like import) in the Registration Statement, Prospectus
or preliminary prospectus shall be deemed to include all such financial
statements and schedules and other information which is incorporated by
reference in the Registration Statement, Prospectus or preliminary prospectus,
as the case may be; and all references in this Agreement to amendments or
supplements to the Registration Statement, Prospectus or preliminary prospectus
shall be deemed to include the filing of any document under the 1934 Act which
is incorporated by reference in the Registration Statement, Prospectus or
preliminary prospectus, as the case may be.
SECTION 1. APPOINTMENT AS AGENT.
(a) APPOINTMENT. Subject to the terms and conditions stated herein,
including, without limitation, the reservation by the Company of the right to
sell Notes directly on its own behalf as set forth in Section 3(d) hereof, the
Company hereby agrees with the Agent that the Notes will be sold exclusively to
or through the Agent pursuant to the terms and conditions of this Agreement and
that the Company will not appoint any other agents to act on the Company's
behalf, or to assist the Company, in the placement of the Notes.
(b) SALE OF NOTES. The Company shall not sell or approve the
solicitation of offers for the purchase of Notes in excess of the aggregate
initial offering price of Notes registered pursuant to the Registration
Statement. The Agent shall have no responsibility for maintaining records 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.
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(c) PURCHASES AS PRINCIPAL. Absent an agreement between the Agent and
the Company for the Agent to act as an agent for the Company for the purpose of
soliciting offers for the purchase of Notes from the Company, the Agent shall be
deemed to be acting as principal in connection with any issuance and sale of
Notes by the Company hereunder. Accordingly, the Agent may agree from time to
time to purchase Notes from the Company as principal for resale to investors
determined by the Agent; PROVIDED, HOWEVER, that the Agent shall not have any
obligation to purchase Notes from the Company as principal except pursuant to
any Terms Agreement (as hereinafter defined). Any purchase of Notes from the
Company by the Agent as principal shall be made in accordance with Section 3(a)
hereof.
(d) SOLICITATIONS AS AGENT. From time to time, the Company and the
Agent may agree that the Agent will act as agent for the Company for the purpose
of soliciting offers to purchase Notes from the Company. When so agreed by the
Company and the Agent, the Agent, acting solely as an agent for the Company and
not as principal, shall use its reasonable efforts to solicit and receive offers
to purchase Notes from the Company upon the terms and conditions set forth
herein (including, without limitation, Section 3(b) hereof) and upon the terms
communicated to the Agent from time to time by the Company at such times and in
such amounts as the Company shall from time to time specify.
(e) RELIANCE. The Company and the Agent agree that any Notes purchased
from the Company by the Agent as principal shall be purchased, and any Notes the
placement of which the Agent arranges as an agent of the Company shall be placed
by the Agent, in reliance on the representations, warranties, covenants and
agreements of the Company contained herein and on the terms and conditions and
in the manner provided herein.
(f) COMMENCEMENT DATE. The documents required to be delivered pursuant
to Section 5 hereof on the Commencement Date (as defined below) shall be
delivered to the Agent at the offices of Xxxxxx Xxxxxx Xxxxx & Xxxx LLP, 000
Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 10:00 a.m., on the date of this
Agreement, which date and time of such delivery may be postponed by agreement
between the Agent and the Company but in no event shall be later than the day
prior to the date on which solicitation of offers to purchase Notes is commenced
or on which the Agent first agrees to purchase Notes from the Company as
principal (such time and date being referred to herein as the "Commencement
Date").
SECTION 2. REPRESENTATIONS AND WARRANTIES.
(a) The Company represents and warrants to the Agent, as of the date
hereof, as follows:
(i) DUE INCORPORATION, GOOD STANDING AND DUE
QUALIFICATION OF THE COMPANY. The Company has been duly incorporated
and is validly existing as a corporation in good standing under the
laws of the State of Delaware with corporate power and authority to own
its properties and to conduct its business as described in the
Prospectus and to enter into this Agreement and consummate the
transactions contemplated hereby, and is duly qualified as a foreign
corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason
of the ownership or leasing of property or the conduct of business,
except where the failure to so qualify or
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be in good standing would not result in a Material Adverse Effect (as
hereinafter defined).
(ii) DUE INCORPORATION AND GOOD STANDING OF SUBSIDIARIES.
Each of the Company's Significant Subsidiaries (as hereinafter defined)
has been duly organized and is validly existing in good standing under
the laws of the jurisdiction of its organization with power and
authority to own its properties and conduct its business as described
in the Prospectus, and, except as stated in the Prospectus or in any
document incorporated by reference therein, all of the issued and
outstanding shares of capital stock or partnership interests of each
Significant Subsidiary have been duly authorized and validly issued,
are fully paid and non-assessable and (except for directors' qualifying
shares) are owned by the Company, directly or indirectly, free and
clear of any security interest, mortgage, pledge, lien, encumbrance or
claim.
(iii) REGISTRATION STATEMENT AND PROSPECTUS. The Company
meets the requirements for use of Form S-3 under the 1933 Act; the
Registration Statement has become effective under the 1933 Act and no
stop order suspending the effectiveness of the Registration Statement
has been issued under the 1933 Act and no proceedings for that purpose
have been instituted or, to the knowledge of the Company, are
threatened by the Commission and any request on the part of the
Commission for additional information relating to the Registration
Statements and the Notes has been complied with in all material
respects; the Indenture has been duly qualified under the 1939 Act; at
the respective times that the Registration Statement and any
post-effective amendment thereto became effective, the Registration
Statement and any such amendment thereto complied in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations and the 1939 Act and the rules and regulations of the
Commission under the 1939 Act (the "1939 Act Regulations"); as of each
Representation Date (as hereinafter defined) the Registration Statement
and any post-effective amendment thereto will comply in all material
respects with the requirements of the 1933 Act and the 1933 Act
Regulations and the 1939 Act and the 1939 Act Regulations; at the
respective times that the Registration Statement and any post-effective
amendment thereto (including the filing of the Company's most recent
Annual Report on Form 10-K with the Commission (the "Annual Report on
Form 10-K")) became effective, the Registration Statement and any such
amendment thereto did 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; as of each
Representation Date, the Registration Statement does 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 the
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 1933 Act, complied when so filed in all material respects
with the 1933 Act Regulations; as of the applicable date of the
Prospectus and any amendment or supplement thereto, neither the
Prospectus nor any such amendment or supplement thereto included or
includes an untrue statement of a material fact or omitted or omits 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; and, as of each Representation Date, the Prospectus
does not and will not include an untrue statement of
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a material fact or 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
(a) statements in or omissions from the Registration Statement or any
amendment thereto or the preliminary prospectus or the Prospectus or
any amendment or supplement thereto made in reliance upon and in
conformity with information furnished to the Company in writing by the
Agent expressly for use in the Registration Statement or any amendment
thereto or the preliminary prospectus or the Prospectus or any
amendment or supplement thereto and (b) that part of the Registration
Statement which constitutes the Trustee's Statement of Eligibility on
Form T-1 (the "Form T-1") under the 1939 Act.
(iv) INCORPORATED DOCUMENTS. The documents incorporated by
reference in the Prospectus and any further documents so filed and
incorporated by reference in the Prospectus, at the time they were or
hereafter are filed with the Commission (a) complied when so filed or
will comply when filed in all material respects with the requirements
of the 1934 Act and the rules and regulations of the Commission under
the 1934 Act (the "1934 Act Regulations"), and (b) did not include when
so filed or will not include when filed an untrue statement of a
material fact or 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.
(v) INDEPENDENT ACCOUNTANTS. The accountants who
certified the financial statements and any supporting schedules thereto
included in the Registration Statement and the Prospectus are
independent public accountants as required by the 1933 Act and the 1933
Act Regulations.
(vi) FINANCIAL STATEMENTS. Except as noted therein, the
consolidated financial statements of the Company included in the
Registration Statement and the Prospectus, together with the related
schedules and notes, as well as those financial statements, schedules
and notes of any other entity included in the Registration Statement
and the Prospectus thereto, present fairly in all material respects the
consolidated financial position of the Company and its consolidated
subsidiaries as of the dates indicated and the results of their
operations and changes in their consolidated cash flows for the periods
specified; such financial statements have been prepared in conformity
with accounting principles generally accepted in the United States
("GAAP") applied on a consistent basis throughout the periods involved;
the supporting schedules, if any, included in the Registration
Statement and the Prospectus present fairly in all material respects,
as of the dates indicated, in accordance with GAAP the information
required to be stated therein; the selected and consolidated financial
data and the summary financial information included in the Registration
Statement and the Prospectus present fairly in all material respects,
as of the dates indicated, the information shown therein and, unless
otherwise indicated therein, have been compiled on a basis consistent
with that of the audited financial statements included in the
Registration Statement and the Prospectus; and any pro forma
consolidated financial statements of the Company and its subsidiaries
and the related notes thereto included in the Registration Statement
and the Prospectus have been
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prepared in accordance with the applicable requirements of the 1933
Act, the 1933 Act Regulations, the 1934 Act and the 1934 Act
Regulations, as applicable.
(vii) NO MATERIAL CHANGES. Since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein, (1) there has not been
any material adverse change, or known development involving the
reasonable likelihood of a prospective material adverse change, in the
business, operations or financial condition of the Company and its
consolidated subsidiaries taken as a whole (a "Material Adverse
Effect"); and (2) neither the Company nor any of its "significant
subsidiaries" (as defined in Rule 1-02 of Regulation S-X under the 1933
Act) (collectively, the "Significant Subsidiaries") has entered into
any transaction or agreement, other than those in the ordinary course
of business, material to the Company and its consolidated subsidiaries
considered as one enterprise.
(viii) AUTHORIZATION, ETC. OF THIS AGREEMENT, THE INDENTURE
AND THE NOTES. This Agreement has been duly authorized, executed and
delivered by the Company; the Indenture has been duly authorized,
executed and delivered by the Company and will be a valid and legally
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as enforcement thereof may be limited
by bankruptcy, insolvency, reorganization, fraudulent conveyance or
transfer, moratorium or other similar laws affecting the enforcement of
creditors' rights generally or by general equitable principles
(regardless of whether enforcement is considered in a proceeding in
equity or at law); the Notes have been duly authorized by the Company
for offer, sale, issuance and delivery pursuant to this Agreement and,
when issued, authenticated and delivered in the manner provided for in
the Indenture and delivered against payment of the consideration
therefor, will constitute valid and legally binding obligations of the
Company, enforceable against the Company in accordance with their
terms, except as enforcement thereof may be limited by bankruptcy,
insolvency, reorganization, fraudulent conveyance or transfer,
moratorium or other similar laws affecting the enforcement of
creditors' rights generally or by general equitable principles
(regardless of whether enforcement is considered in a proceeding in
equity or at law); the Notes will be substantially in the form
contemplated by the Indenture; and each holder of Notes will be
entitled to the benefits of the Indenture.
(ix) DESCRIPTIONS OF THE INDENTURE AND THE NOTES. The
Indenture and the Notes conform and will conform in all material
respects to the descriptions thereof contained in the Prospectus and
are substantially in the form filed or incorporated by reference, as
the case may be, as an exhibit to the Registration Statement.
(x) ACCURACY OF EXHIBITS. There are no contracts or
documents which are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement which have not been so described or filed as
required.
(xi) ABSENCE OF DEFAULTS AND CONFLICTS. Neither the
Company nor any of its Significant Subsidiaries is, or with the giving
of notice or lapse of time or both would be, in violation of or in
default under, its charter or by-laws or other organizational document
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or any indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument, which is material to the Company and its
consolidated subsidiaries, taken as a whole, and to which the Company
or any of its Significant Subsidiaries is a party or by which the
Company or any of its Significant Subsidiaries is bound or to which any
of the property or assets of the Company or any of its Significant
Subsidiaries is subject, which is material to the Company and its
consolidated subsidiaries, taken as a whole, except for violations and
defaults which individually or in the aggregate would not result in a
Material Adverse Effect; and the execution, delivery and performance by
the Company of its obligations under this Agreement, the Indenture and
the Notes and the consummation of the transactions contemplated herein
and therein will not conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or
instrument, which is material to the Company and its consolidated
subsidiaries, taken as a whole, and to which the Company or any of its
Significant Subsidiaries is a party or by which the Company or any of
its Significant Subsidiaries is bound or to which any of the property
or assets of the Company or any of its Significant Subsidiaries is
subject, which is material to the Company and its consolidated
subsidiaries, taken as a whole, nor will any such action result in any
violation of the provisions of the charter, by-laws or other
organizational document of the Company or any of its Significant
Subsidiaries or any applicable law, statute, rule, regulation,
judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over
the Company, its Significant Subsidiaries or any of their respective
property or assets.
(xii) ABSENCE OF PROCEEDINGS. Other than as set forth or
contemplated in the Prospectus or the documents incorporated by
reference therein, there are no legal or governmental proceedings
pending or, to the knowledge of the Company, threatened to which the
Company or any of its Significant Subsidiaries is, or, to the knowledge
of the Company, threatened to be, a party or to which any property or
assets of the Company or any of its Significant Subsidiaries is or, to
the knowledge of the Company, threatened to be the subject, which, if
determined adversely to the Company, could individually or in the
aggregate reasonably be expected to result in a Material Adverse Effect
or which might reasonably be expected to materially and adversely
affect the consummation of the transactions contemplated in this
Agreement or the performance by the Company of its obligations
hereunder.
(xiii) NO FILINGS, REGULATORY APPROVALS ETC. No filing with,
or approval, authorization, consent, license, registration,
qualification, order or decree of, any court or governmental authority
or agency, domestic or foreign, is necessary or required for the
execution, delivery and performance by the Company of its obligations
under this Agreement, the Indenture and the Notes, except such filings,
approvals, authorizations, consents, licenses, registrations,
qualifications, orders or decrees as have been obtained under the 1933
Act and the 1939 Act and as may be required under state securities or
blue sky laws in connection with the issuance and sale of the Notes and
except for the filing of any Pricing Supplement (as hereinafter
defined) under the 1933 Act.
(xiv) INVESTMENT COMPANY ACT. The Company is not, and upon
the issuance and sale of the Notes as herein contemplated and the
application of the net proceeds
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therefrom as described in the Prospectus will not be, an "investment
company" within the meaning of the Investment Company Act of 1940 (the
"1940 Act").
(xv) RATINGS. The Xxxxxxxx CoreNotesSM Program under which
the Notes are issued (the "Program") is rated "Aa3" by Xxxxx'x
Investors Service, Inc. and "AA-" by Standard & Poor's Ratings
Services, or such other rating as to which the Company shall have most
recently notified the Agent pursuant to Section 4(a) hereof.
(b) ADDITIONAL CERTIFICATIONS. Any certificate signed by any officer of
the Company or any of its subsidiaries and delivered to the Agent or to counsel
for the Agent pursuant to Section 5(c) or 7(b) hereof shall be deemed a
representation and warranty by the Company to the Agent as to the matters
covered thereby on the date of such certificate and, unless subsequently amended
or supplemented, at each Representation Date subsequent thereto.
SECTION 3. PURCHASES AS PRINCIPAL; SOLICITATIONS AS AGENT.
(a) PURCHASES AS PRINCIPAL. Each tranche of Notes purchased from the
Company by the Agent as principal shall be made in accordance with the terms of
this Agreement and a separate agreement to be completed and agreed upon orally
and promptly thereafter memorialized in writing (including by e-mail or
facsimile transmission), substantially in form of Exhibit A hereto, by the Agent
and the Company. Each such separate agreement is herein referred to as a "Terms
Agreement". Each Terms Agreement shall specify any additional requests of the
Agent for the delivery of an officers' certificate, opinion of counsel and/or
comfort letter pursuant to Sections 7(b), 7(c) and 7(d) hereof, respectively, in
connection with the purchase of such Notes. The Agent's commitment to purchase
Notes as principal as set forth in any Terms Agreement shall be deemed to have
been made on the basis of the representations and warranties of the Company
herein contained and shall be subject to the terms and conditions herein set
forth. Unless the context otherwise requires, references herein to "this
Agreement" shall include the applicable Terms Agreement. Each purchase of Notes,
unless otherwise agreed, shall be at a discount from the principal amount of
each such Note equivalent to the applicable commission set forth in Schedule A
hereto. The Agent may engage the services of any broker or dealer in connection
with the resale of the Notes purchased by it as principal or allow all or any
portion of the discount received by it in connection with such purchases to any
broker or dealer. Each date of delivery of and payment for Notes pursuant to a
Terms Agreement is referred to herein as a "Settlement Date".
(b) SOLICITATIONS AS AGENT. For the purpose of solicitations as agent,
the Agent will use the preliminary prospectus or the Prospectus which has been
most recently furnished to the Agent by the Company. The Agent will communicate
to the Company, and confirm in writing (including by e-mail transmission), each
offer for the purchase of Notes solicited by it on an agency basis other than
those offers rejected by the Agent. The Agent shall have the right, in its
discretion reasonably exercised, to reject any 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. The Company shall have the sole right to accept
offers for the purchase of Notes and may reject any offer for the purchase of
Notes, in whole or in part. The Agent shall make reasonable efforts to assist
the Company in obtaining performance by each purchaser whose offer for the
purchase of Notes has been solicited by it on an agency basis and accepted by
the Company. The Agent shall
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not have any liability to the Company in the event that any such purchase is not
consummated for any reason other than, subject to the immediately following
sentence, the obligation to repay the Company any commission paid by the Company
to the Agent with respect thereto. If the Company shall default on its
obligation to deliver Notes to a purchaser whose offer has been solicited by the
Agent on an agency basis and accepted by the Company, the Company shall (i) hold
the Agent harmless against any loss, claim or damage arising from or as a result
of such default by the Company and (ii) pay to the Agent any commission to which
it would otherwise be entitled absent such default. The Company shall not be
required to pay the Agent a commission in connection with any purchase of a Note
which is not consummated other than as a result of a default by the Company of
its obligations hereunder, including its obligation to deliver Notes to a
purchaser whose offer has been accepted The Agent may engage the services of any
broker or dealer in connection with solicitations of offers to purchase Notes.
All Notes sold through the Agent as agent will be sold at 100% of their initial
offering price unless otherwise agreed upon between the Company and the Agent.
The Company reserves the right, in its sole discretion, to suspend
solicitation of offers for the purchase of Notes through the Agent, as an agent
of the Company, commencing at any time for any period of time or permanently. As
soon as practicable after receipt of instructions from the Company, but in any
event not later than one business day after receipt of such instructions from
the Company, the Agent will suspend solicitation of offers for the purchase of
Notes from the Company until such time as the Company has advised the Agent that
such solicitation may be resumed.
Subject to the provisions of the first paragraph of this Section 3(b),
the Company agrees to pay the Agent, as consideration for sales of Notes by the
Company as a result of a solicitation made by the Agent as an agent of the
Company, a commission equal to the applicable percentage of the principal amount
of each Note sold by the Company as a result of any such solicitation made by
the Agent, as set forth in Schedule A hereto.
(c) ADMINISTRATIVE PROCEDURES. The purchase price, interest rate or
formula, maturity date and other terms of the Notes described in the form of
Terms Agreement attached hereto as Exhibit A hereto (as applicable) shall be
agreed upon between the Company and the Agent and specified in a pricing
supplement to the Prospectus (each, a "Pricing Supplement"), substantially in
the form attached hereto as Exhibit B, to be prepared by the Company in
connection with each sale of Notes, whether under Section 3(a) or 3(b) of this
Agreement. The Notes will be issued in denominations of U.S. $1,000 or any
larger amount that is an integral multiple of U.S. $1,000. Procedural details
relating to the issuance and sale of, and solicitation of offer to purchase and
payment for, the Notes, whether under Section 3(a) or 3(b) of this Agreement,
are substantially set forth in the Administrative Procedures attached hereto as
Exhibit C, as amended from time to time (the "Procedures"). The provisions of
the Procedures shall apply to all transactions contemplated hereunder. The Agent
and the Company agree to perform their respective duties and obligations
specifically provided to be performed by them in the Procedures. The Procedures
may only be amended by the agreement of the Company, the Agent and the Trustee.
(d) RESERVATION OF COMPANY RIGHTS. Subject to Section 4(i) hereof, the
Company reserves the right to sell, and may solicit and accept offers to
purchase, Notes directly on its own behalf; PROVIDED, HOWEVER, that if at the
time of any such sales the Agent is posting terms and
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conditions for the purchase and sale of the Notes, such sales shall be on
substantially the same terms and conditions as then posted by the Agent;
PROVIDED FURTHER, that in the case of any such sales not resulting from a
solicitation made by the Agent, no commission shall be payable to the Agent with
respect to such sales.
SECTION 4. COVENANTS OF THE COMPANY.
The Company covenants and agrees with the Agent as follows:
(a) NOTICE OF CERTAIN EVENTS. During the term of this Agreement, the
Company will notify the Agent immediately, and confirm such notice in writing,
of (i) the effectiveness of any post-effective amendment to the Registration
Statement or the filing of any amendment or supplement to the Prospectus (other
than (x) the filing of any amendment or supplement thereto providing solely for
the determination of the variable terms of the Notes (including any Pricing
Supplement) or relating solely to the offering of securities other than the
Notes or (y) the Company's periodic filings with the Commission pursuant to the
1934 Act, the notification requirements for which are set forth in Section 4(b)
below) (ii) the receipt of any comments from the Commission relating to the
Registration Statements and the Notes, (iii) any request by the Commission for
any amendment to the Registration Statement or any amendment or supplement to
the Prospectus or for additional information or (iv) the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement, or of any order preventing or suspending the use of any preliminary
prospectus, or of the initiation of any proceedings for that purpose or (v) any
change in the rating assigned by any nationally recognized statistical rating
organization to the Program or any debt securities (including the Notes) of the
Company, or the public announcement by any nationally recognized statistical
rating organization that it has under surveillance or review, with possible
negative implications, its rating of the Program or any such debt securities, or
the withdrawal by any nationally recognized statistical rating organization of
its rating of the Program or any such debt securities. The Company will make
every reasonable effort to prevent the issuance of any stop order and, if any
stop order is issued, to promptly obtain the lifting thereof.
(b) FILING OR USE OF AMENDMENTS. During the term of this Agreement, the
Company will, in the case of any filing with the Commission under the 1933 Act
or otherwise, or will use reasonable efforts to, in the case of any periodic
filing with the Commission under the 1934 Act, give the Agent advance notice of
its intention to file or prepare any additional registration statement with
respect to the registration of additional Notes, any amendment to the
Registration Statement (including any filing under Rule 462(b) of the 1933 Act
Regulations) or any amendment or supplement to the prospectus included in the
Registration Statement at the time it became effective or to the Prospectus
(other than the filing of any amendment or supplement thereto providing solely
for the determination of the variable terms of the Notes (including any Pricing
Supplement) or relating solely to the offering of securities other than the
Notes).
(c) DELIVERY OF THE REGISTRATION STATEMENT. The Company will deliver to
the Agent, if requested and without charge, a signed and conformed copy of the
Registration Statement as originally filed and of each amendment thereto
(including exhibits filed therewith or incorporated by reference therein and
documents incorporated or deemed to be incorporated by reference therein) and a
signed and conformed copy of all consents and certificates of experts.
-10-
The Registration Statement and each amendment thereto furnished to the Agent
will be identical to any electronically transmitted copies thereof filed with
the Commission pursuant to XXXXX, except to the extent permitted by Regulation
S-T.
(d) DELIVERY OF THE PROSPECTUS. The Company will deliver to the Agent
as many copies of each preliminary prospectus as the Agent may reasonably
request, and the Company hereby consents to the use of such copies for purposes
permitted by the 1933 Act. The Company will furnish to the Agent such number of
copies of the Prospectus (as amended or supplemented) as the Agent may
reasonably request.
(e) PREPARATION OF PRICING SUPPLEMENTS. The Company will prepare, with
respect to any Notes to be sold to or through the Agent pursuant to this
Agreement, a Pricing Supplement, substantially in the form attached hereto as
Exhibit B. Subject to the provisions of the Procedures, the Company will deliver
such Pricing Supplement to the Agent 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) under the 1933 Act.
(f) REVISIONS OF PROSPECTUS -- MATERIAL CHANGES. If at any time during
the term of this Agreement, any event shall occur or condition shall exist as a
result of which it is necessary to amend the Registration Statement in order
that the Registration Statement 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, or to amend or
supplement the Prospectus in order that the Prospectus will not include an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein not misleading in the light of the
circumstances existing at the time the Prospectus is delivered to a purchaser,
or if it shall be necessary to amend the Registration Statement or amend or
supplement the Prospectus in order to comply with the requirements of the 1933
Act or the 1933 Act Regulations, the Company shall give immediate notice,
confirmed in writing, to the Agent to cease the solicitation of offers for the
purchase of Notes in its capacity as agent and to cease sales of any Notes it
may then own as principal, and, if so notified, the Agent shall cease such
solicitations and sales as soon as practicable, but in any event not later than
one business day after receipt of notice from the Company, and the Company,
unless the Company determines, in its sole discretion and at a time when the
Agent shall not then be holding any Notes purchased from the Company as
principal, to suspend the Program, will promptly prepare and file with the
Commission, subject to Section 4(b) hereof, such amendment or supplement as may
be necessary to correct such statement or omission or to make the Registration
Statement and Prospectus comply with such requirements, and the Company will
furnish to the Agent, without charge, such number of copies of such amendment or
supplement as the Agent may reasonably request. In addition, the Company will
comply with the 1933 Act, the 1933 Act Regulations, the 1934 Act and the 1934
Act Regulations so as to permit the completion of the distribution of each
offering of Notes.
(g) USE OF PROCEEDS. The Company will use the net proceeds received by
it from the issuance and sale of the Notes in the manner specified in the
Prospectus.
(h) REPORTING REQUIREMENTS. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to
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be filed with the Commission pursuant to the 1934 Act within the time periods
prescribed by the 1934 Act and the 1934 Act Regulations.
(i) RESTRICTION ON OFFERS AND SALES OF SECURITIES. Unless otherwise
agreed upon between the Agent, acting as principal, and the Company, between the
date of a Terms Agreement and the related Settlement Date, the Company will not,
without the prior written consent of the Agent, issue, sell, offer or contract
to sell, grant any option for the sale of, or otherwise dispose of, principally
to retail investors in the United States any debt securities of the Company
having terms, including, without limitation, maturity dates, substantially
similar to the Notes being sold under such applicable Terms Agreement.
Notwithstanding the foregoing, the Company may sell its commercial paper in the
ordinary course of business.
(j) BLUE SKY QUALIFICATIONS. The Company will use its best efforts, in
cooperation with the Agent, to qualify the Notes for offering and sale under the
applicable securities laws of such states and other jurisdictions of the United
States as the Agent may designate, and will maintain such qualifications in
effect for as long as may be required for the distribution of the Notes;
PROVIDED, HOWEVER, that the Company shall not be obligated to file any general
consent to service of process or to qualify as a foreign corporation or as a
dealer in securities in any jurisdiction in which it is not so qualified or to
subject itself to taxation in respect of doing business in any jurisdiction in
which it is not otherwise so subject. In each jurisdiction in which the Notes
have been so qualified, the Company will file such statements and reports as may
be required by the laws of such jurisdiction to continue such qualification in
effect for so long as may be required for the distribution of the Notes. The
Company will promptly advise the Agent of the receipt by the Company of any
notification with respect to the suspension of the qualification of the Notes
for sale in any such state or jurisdiction or the initiating or threatening of
any proceeding, known to the Company, for such purpose.
SECTION 5. CONDITIONS OF THE AGENT'S OBLIGATIONS.
The obligations of the Agent hereunder are subject to the following
conditions, each of which shall be satisfied as of the Commencement Date: (i)
the accuracy of the representations and warranties of the Company herein
contained or contained in any certificate of an officer of the Company or any of
its subsidiaries delivered pursuant to the provisions hereof at and as of the
Commencement Date and (ii) the performance and observance by the Company of its
covenants and other obligations hereunder to be performed at or prior to the
Commencement Date, and to the following additional conditions:
(a) EFFECTIVENESS OF REGISTRATION STATEMENT. The Registration Statement
(including any Rule 462(b) Registration Statement) has become effective under
the 1933 Act and no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 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 Agent.
(b) LEGAL OPINIONS. The Agent shall have received the following legal
opinions, dated as of the Commencement Date, and in form and substance
reasonably satisfactory to the Agent:
-12-
(1) OPINION OF COUNSEL FOR THE COMPANY. The favorable
opinion of the General Counsel, Deputy General Counsel or an
Assistant General Counsel of the Company, or other counsel
reasonably satisfactory to the Agent, to the effect set forth
in Exhibit D hereto.
(2) OPINION OF COUNSEL FOR THE AGENT. The favorable
opinion of Xxxxxx Xxxxxx Xxxxx & Xxxx LLP, counsel for the
Agent, with respect to the matters set forth in paragraphs 1,
4, 5, 7, 8, 12, 13 and 15 of Exhibit D hereto.
(c) OFFICER'S CERTIFICATE. There shall not have been, since the
respective dates as of which information is given in the Registration Statement
and the Prospectus, any Material Adverse Effect, and the Agent shall have
received a certificate of the Company, signed by the Treasurer and Secretary of
the Company, dated as of the Commencement Date, to the effect that (i) there has
been no such Material Adverse Effect, (ii) the representations and warranties of
the Company herein contained are true and correct with the same force and effect
as though expressly made at and as of the Commencement Date, (iii) the Company
has complied with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to the Commencement Date, and (iv) no stop
order suspending the effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted, are pending or, to the
best of such officer's knowledge, are threatened by the Commission.
(d) COMFORT LETTER OF KPMG, LLP. The Agent shall have received a letter
from KPMG, LLP, dated as of the Commencement Date, in form and substance
reasonably satisfactory to the Agent, to the effect set forth in Exhibit E
hereto.
(e) ADDITIONAL DOCUMENTS. Counsel to the Agent shall have been
furnished with such documents and opinions as such counsel may reasonably
require for the purpose of enabling such counsel to pass upon the issuance and
sale of Notes as herein contemplated 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 in connection with the issuance and sale of Notes as herein
contemplated shall be reasonably satisfactory in form and substance to the Agent
and to counsel to the Agent.
SECTION 6. DELIVERY OF AND PAYMENT FOR NOTES SOLD THROUGH THE AGENT AS AGENT.
Delivery of Notes sold through the Agent as an agent of the Company
shall be made by the Company to the Agent for the account of any purchaser only
against payment therefor in immediately available funds. In the event that a
purchaser shall fail either to accept delivery of or to make payment for a Note
on the date fixed for settlement, the Agent shall promptly notify the Company
and deliver such Note to the Company and, if the Agent has theretofore paid the
Company for such Note, the Company will promptly return such funds, to the
extent previously paid by the Agent, to the Agent.
SECTION 7. ADDITIONAL COVENANTS OF THE COMPANY.
The Company further covenants and agrees with the Agent as follows:
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(a) REAFFIRMATION OF REPRESENTATIONS AND WARRANTIES. Each (i)
acceptance by the Company of an offer for the purchase of Notes (whether to the
Agent as principal or through the Agent as agent) (the dates of each such
acceptance, the "Acceptance Dates"), and each delivery of Notes (whether to the
Agent as principal or through the Agent as agent) (the dates of each such
delivery, the "Delivery Dates") and (ii) filing of an amendment or supplement to
the Registration Statement or the Prospectus (other than by an amendment or
supplement providing solely for the determination of the variable terms of the
Notes (including the filing of any Pricing Supplement) or relating solely to the
offering of securities other than the Notes) (the dates of each such filing, a
"Filing Date", and together with the Acceptance Dates, the Delivery Dates and
the Commencement Date, the "Representation Dates") shall be deemed to be an
affirmation to the Agent that the representations and warranties of the Company
herein contained and contained in any certificate theretofore delivered to the
Agent pursuant hereto are true and correct at the time of such acceptance,
delivery, sale or filing, as the case may be, as though made at and as of such
date (it being understood that such representations and warranties shall relate
to the Registration Statement and Prospectus as amended and supplemented to each
such time).
(b) SUBSEQUENT DELIVERY OF CERTIFICATES. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented (other
than by (x) an amendment or supplement providing solely for the determination of
the variable terms of the Notes (including the filing of any Pricing Supplement)
or relating solely to the offering of securities other than the Notes, (y)
unless otherwise expressly and reasonably requested by the Agent, the filing of
the Company's Current Reports on Form 8-K with the Commission pursuant to the
1934 Act or (z) amendments or supplements relating to earnings statements or
other general public interim or annual financial statement information to the
extent not included in the Company's Quarterly Reports on Form 10-Q or Annual
Reports on Form 10-K filed with the Commission pursuant to the 1934 Act),
unless, subject to the immediately following sentence, the Company has suspended
the solicitation of offers to purchase Notes pursuant to Section 3(b) hereof,
(ii) the Company sells Notes to the Agent as principal and solely to the extent
reasonably requested by the Agent and specified pursuant to Section 3(a) hereof
in the applicable Terms Agreement or (iii) the Company sells Notes in a form not
previously certified to the Agent by the Company, the Company shall furnish or
cause to be furnished to the Agent, forthwith a certificate dated the date of
filing with the Commission or the date of effectiveness of such amendment or
supplement, as applicable, or the date of such sale, as the case may be, in form
reasonably satisfactory to the Agent to the effect that the statements contained
in the certificate referred to in Section 5(c) hereof which were last furnished
to the Agent are true and correct at the time of the filing or effectiveness of
such amendment or supplement, as applicable, or the time of such sale, as the
case may be, as though made at and as of such time (except that such statements
shall be deemed to relate to the Registration Statement and the Prospectus as
amended and supplemented to such time) or, in lieu of such certificate, a
certificate of the same tenor as the certificate referred to in Section 5(c)
hereof, modified as necessary to relate to the Registration Statement and the
Prospectus as amended and supplemented to the time of delivery of such
certificate (it being understood that, in the case of clause (ii) above, any
such certificate shall also include a certification that there has been no
Material Adverse Effect since the date of the agreement by the Agent to purchase
Notes from the Company as principal). In the event that the Company is not
required to fulfill any obligations set forth in the immediately preceding
sentence that it may have because the Company has suspended the solicitation of
offers to purchase Notes pursuant to
-14-
Section 3(b) hereof, the Company shall fulfill any such obligations at such time
as the Company has advised the Agent that solicitation may be resumed pursuant
to Section 3(b) hereof.
(c) SUBSEQUENT DELIVERY OF LEGAL OPINIONS. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented (other
than by (x) an amendment or supplement providing solely for the determination of
the variable terms of the Notes (including the filing of any Pricing Supplement)
or relating solely to the offering of securities other than the Notes, (y)
unless otherwise expressly and reasonably requested by the Agent, the filing of
the Company's Current Reports on Form 8-K with the Commission pursuant to the
1934 Act or (z) amendments or supplements relating to earnings statements or
other general public interim or annual financial statement information to the
extent not included in the Company's Quarterly Reports on Form 10-Q or Annual
Reports on Form 10-K filed with the Commission pursuant to the 1934 Act),
unless, subject to the immediately following sentence, the Company has suspended
the solicitation of offers to purchase Notes pursuant to Section 3(b) hereof,
(ii) the Company sells Notes to the Agent as principal and solely to the extent
reasonably requested by the Agent and specified pursuant to Section 3(a) hereof
in the applicable Terms Agreement or (iii) the Company sells Notes in a form not
previously opined to the Agent by the Company, the Company shall furnish or
cause to be furnished forthwith to the Agent the written opinion of the General
Counsel, Deputy General Counsel or an Assistant General Counsel of the Company,
or other counsel satisfactory to the Agent, dated the date of filing with the
Commission or the date of effectiveness of such amendment or supplement, as
applicable, or the date of such sale, as the case may be, in form and substance
reasonably satisfactory to the Agent, of the same tenor as the opinion referred
to in Section 5(b)(1) hereof, but modified, as necessary, to relate to the
Registration Statement and the Prospectus as amended and supplemented to the
time of delivery of such opinion or, in lieu of such opinion, counsel last
furnishing such opinion to the Agent shall furnish the Agent with a letter
substantially to the effect that the Agent may rely on such last opinion to the
same extent as though it was dated the date of such letter authorizing reliance
(except that statements in such last opinion shall be deemed to relate to the
Registration Statement and the Prospectus as amended and supplemented to the
time of delivery of such letter authorizing reliance). In the event that the
Company is not required to fulfill any obligations set forth in the immediately
preceding sentence that it may have because the Company has suspended the
solicitation of offers to purchase Notes pursuant to Section 3(b) hereof, the
Company shall fulfill any such obligations at such time as the Company has
advised the Agent that solicitation may be resumed pursuant to Section 3(b)
hereof.
(d) SUBSEQUENT DELIVERY OF COMFORT LETTERS. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented to
include additional financial information (other than by (x) an amendment or
supplement providing solely for the determination of the variable terms of the
Notes (including the filing of any Pricing Supplement) or relating solely to the
offering of securities other than the Notes, (y) unless otherwise expressly and
reasonably requested by the Agent, the filing of the Company's Current Reports
on Form 8-K with the Commission pursuant to the 1934 Act or (z) amendments or
supplements relating to earnings statements or other general public interim or
annual financial statement information to the extent not included in the
Company's Quarterly Reports on Form 10-Q or Annual Reports on Form 10-K filed
with the Commission pursuant to the 1934 Act), unless, subject to the
immediately following sentence, the Company has suspended the solicitation of
offers to purchase Notes pursuant to Section 3(b) hereof or (ii) the Company
sells Notes to the Agent as
-15-
principal and solely to the extent reasonably requested by the Agent and
specified pursuant to Section 3(a) hereof in the applicable Terms Agreement, the
Company shall cause KPMG, LLP or its then engaged accounting firm forthwith to
furnish to the Agent a letter, dated the date of filing with the Commission or
the date of effectiveness of such amendment or supplement, as applicable, or the
date of such sale, as the case may be, in form reasonably satisfactory to the
Agent, of the same tenor as the letter referred to in Section 5(d) hereof but
modified to relate to the Registration Statement and Prospectus as amended and
supplemented to the date of such letter, with such changes as may be necessary
to reflect changes in the financial statements and other information derived
from the accounting records of the Company, to the extent such financial
statements and other information are available as of a date not more than three
business days prior to the date of such letter; PROVIDED, HOWEVER, that, with
respect to any financial information or other matter, such letter may reconfirm
as true and correct at such date as though made at and as of such date, rather
than repeat, statements with respect to such financial information or other
matter made in the letter referred to in Section 5(d) hereof which was last
furnished to the Agent. In the event that the Company is not required to fulfill
any obligations set forth in the immediately preceding sentence that it may have
because the Company has suspended the solicitation of offers to purchase Notes
pursuant to Section 3(b) hereof, the Company shall fulfill any such obligations
at such time as the Company has advised the Agent that solicitation may be
resumed pursuant to Section 3(b) hereof.
SECTION 8. INDEMNIFICATION.
(a) INDEMNIFICATION OF THE AGENT. The Company agrees to indemnify and
hold harmless the Agent and each person, if any, who controls the Agent within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as
follows:
(i) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, arising out of an untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading, or
arising out of an untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(ii) against any and all loss, liability, claim, damage
and expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, provided
that (subject to Section 8(d) hereof) any such settlement is effected
with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the reasonable fees and disbursements of counsel chosen by
the Agent), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
-16-
whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under subparagraph (i) or (ii) above;
PROVIDED, HOWEVER, that this indemnity agreement shall not apply to (A)
any loss, liability, claim, damage or expense to the extent arising out of an
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with written information furnished to the
Company by the Agent expressly for use in the Registration Statement (or any
amendment thereto) or any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto); and (B) any loss, liability, claim, damage or
expense that results from the fact that the Agent sold Notes to a person to whom
there was not sent or given, at or prior to the earlier of either the mailing or
delivery of the written confirmation of such sale or the delivery of such Notes
to such person, a copy of the Prospectus as then amended or supplemented
(excluding the documents incorporated therein by reference), if the Company has
previously furnished copies thereof to the Agent in a sufficient amount of time
in advance of such mailing or delivery to allow the Agent to mail or deliver
such copies to such person and, as of the date of such mailing or delivery, such
Prospectus as then amended or supplemented did not include an untrue statement
of a material fact or 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.
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS. The Agent
agrees to indemnify and hold harmless the Company, its directors, each of its
officers who signed the Registration Statement and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act against any and all loss, liability, claim, damage and
expense described in the indemnity contained in Section 8(a) hereof, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendment thereto) or any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by the Agent expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the Prospectus (or any amendment or supplement thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 8(a) hereof,
counsel to the indemnified parties shall be selected by the Agent and, in the
case of parties indemnified pursuant to Section 8(b) hereof, counsel to the
indemnified shall be selected by the Company. In case any such action shall be
brought against any indemnified party and it shall notify the indemnifying party
of the commencement thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it shall 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
-17-
defense thereof, the indemnifying party shall not be liable to such indemnified
party 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.
No indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 8 or 9 hereof (whether or not the indemnified parties are
actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 8(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 9. CONTRIBUTION.
If the indemnification provided for in Section 8 hereof is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company, on the one hand, and the
Agent, on the other hand, from the offering of the Notes that were the subject
of the claim for indemnification or (ii) if the allocation provided by clause
(i) is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company, on the one hand, and the Agent, on the other
hand, in connection with the statements or omissions which resulted in such
losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company, on the one hand, and the
Agent, on the other hand, in connection with the offering of the Notes that were
the subject of the claim for indemnification shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of such Notes
(before deducting expenses) received by the Company and the total discount or
commission received by the Agent, as the case may be, bears to the aggregate
initial offering price of such Notes.
-18-
The relative fault of the Company, on the one hand, and the Agent, on
the other hand, shall be determined by reference to, among other things, whether
any untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the Company
or by the Agent and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Agent agree that it would not be just and equitable
if contribution pursuant to this Section 9 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 9. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 9 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any applicable untrue or alleged
untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 9, (i) the Agent shall
not be required to contribute any amount in excess of the amount by which the
total discount or commission received by the Agent in connection with the
offering of the Notes that were the subject of the claim for indemnification
exceeds the amount of any damages which the Agent has otherwise been required to
pay by reason of any applicable untrue or alleged untrue statement or omission
or alleged omission and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
For purposes of this Section 9, each person, if any, who controls the
Agent within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934
Act shall have the same rights to contribution as the Agent, and each director
of the Company, each officer of the Company and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company.
SECTION 10. PAYMENT OF EXPENSES.
The Company will pay all expenses incident to the performance of its
obligations under this Agreement, including:
(a) The preparation, filing, printing and delivery of the Registration
Statement as originally filed and all pre-effective amendments thereto and all
periodic reports of the Company filed with the Commission pursuant to the 1934
Act;
(b) The preparation, printing and delivery of the Indenture;
(c) The preparation, issuance and delivery of the Notes, including any
fees and expenses relating to the eligibility and issuance of Notes in
book-entry form and the cost of obtaining CUSIP or other identification numbers
for the Notes;
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(d) The fees and disbursements of the Company's accountants, counsel
and other advisors or agents (including any calculation agent or exchange rate
agent) and of the Trustee and its counsel;
(e) The fees charged by nationally recognized statistical rating
organizations for the rating of the Program and the Notes;
(f) The fees and expenses incurred in connection with any listing of
Notes on a securities exchange; and
(g) Any advertising and other out-of-pocket expenses of the Agent, the
expense of which has been previously approved by the Company in writing.
It is understood, however, that except as provided in this Section 10
and Sections 8 and 9 hereof, the Agent shall pay all other costs and expenses
incurred by it, including:
(a) The filing fees incident to, and the fees and disbursements of
counsel to the Agents in connection with the review, if any, by the National
Association of Securities Dealers, Inc. (the "NASD"); and
(b) Any advertising and other out-of-pocket expenses of the Agent, the
expense of which has not been previously approved by the Company in writing.
SECTION 11. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY.
All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of its
subsidiaries submitted pursuant hereto shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of the Agent or
any controlling person of the Agent, or by or on behalf of the Company, and
shall survive each delivery of and payment for the Notes.
SECTION 12. TERMINATION.
(a) TERMINATION OF THIS AGREEMENT. This Agreement (excluding any Terms
Agreement) may be terminated for any reason, at any time by either the Company
or the Agent, upon the giving of 30 days' prior written notice of such
termination to the other party hereto.
(b) TERMINATION OF AGREEMENT TO PURCHASE NOTES AS PRINCIPAL. The Agent
may terminate any Terms Agreement, immediately upon notice to the Company, at
any time on or prior to the Settlement Date relating thereto, if (i) there has
been, since the date of such agreement or since the respective dates as of which
information is given in the Prospectus, a Material Adverse Effect, or (ii) there
has occurred any material adverse change in the financial markets in the United
States or any outbreak of hostilities or escalation thereof or other calamity or
crisis or any change or development or event involving a prospective change in
national or international political, financial or economic conditions, in each
case the effect of which is such as to make it, in the judgment of the Agent,
impracticable to market such Notes or enforce contracts for the sale of such
Notes, or (iii) trading in any securities of the Company has been suspended or
materially limited by the Commission or a national securities exchange, or if
trading generally on
-20-
the New York Stock Exchange or the American Stock Exchange or in the Nasdaq
National Market has been suspended or materially limited, or minimum or maximum
prices for trading have been fixed, or maximum ranges for prices have been
required, by either of said exchanges or by such system or by order of the
Commission, the NASD or any other governmental authority, (iv) a banking
moratorium has been declared by either Federal or New York authorities, (v) the
rating assigned by any nationally recognized statistical rating organization to
the Program or any debt securities (including the Notes) of the Company as of
the date of such Terms Agreement shall have been lowered or withdrawn since that
date or if any such rating organization shall have publicly announced that it
has under surveillance or review its rating of the Program or any such debt
securities or (vi) there shall have come to the attention of the Agent any facts
that would cause the Agent to believe that the Prospectus, at the time that is
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 light of the circumstances existing at
the time of such delivery, not misleading.
(c) GENERAL. In the event this Agreement is terminated, neither party
will have any liability to the other party hereto, except that (i) the Agent
shall be entitled to any commissions earned in accordance with Section 3(b)
hereof, (ii) if at the time of termination (a) the Agent shall own any Notes
purchased by it from the Company as principal or (b) an offer to purchase any of
the Notes has been accepted by the Company but the time of delivery to the
purchaser or his agent of such Notes relating thereto has not occurred, the
covenants set forth in Sections 4 and 7 hereof shall remain in effect until such
Notes are so resold or delivered, as the case may be and (iii) the provisions of
Section 10 hereof, the indemnity and contribution agreements set forth in
Sections 8 and 9 hereof, and the provisions of Sections 11, 14 and 15 hereof
shall remain in effect. In the event this Agreement is terminated, the Company
shall retain the sole right to accept any then outstanding offers for the
purchase of Notes and may reject any then outstanding offers for the purchase of
Notes, in whole or in part. In the event any Terms Agreement is terminated,
neither party will have any liability to the other party hereto, except that the
Agent shall be entitled to any commissions earned in accordance with Section
3(b) hereof.
SECTION 13. NOTICES.
Unless otherwise provided herein, all notices required under the terms
and provisions hereof shall be in writing, either delivered by hand, by mail or
by telex, telecopier or telegram, and any such notice shall be effective when
received at the address specified below.
If to the Company:
Xxx Xxxxxxxx Xxxxxxx
Prudential Tower Building
Boston, Massachusetts 02199
Attention: Director - Capital Markets, Treasury Operations
Telecopy No.: (000) 000-0000
-21-
If to the Agent:
Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx & Xxxxx
Incorporated
4 World Financial Center, Floor 00
Xxx Xxxx, Xxx Xxxx 10080
Attention: MTN Product Management
Telecopy No.: (000) 000-0000
or at such other address as such party may designate from time to time by notice
duly given in accordance with the terms of this Section 13.
SECTION 14. PARTIES.
This Agreement shall inure to the benefit of and be binding upon the
Agent and the Company and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto and their respective
successors and the controlling persons, officers and directors referred to in
Sections 8 and 9 hereof and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the parties
hereto and their respective successors, and said controlling persons, officers
and directors and their heirs and legal representatives, and for the benefit of
no other person, firm or corporation. No purchaser of Notes shall be deemed to
be a successor by reason merely of such purchase. Neither this Agreement nor any
of the rights, interests or obligations hereunder may be assigned, in whole or
in part, by either party, without the prior written consent of the other party.
SECTION 15. GOVERNING LAW; FORUM.
THIS AGREEMENT AND ALL THE RIGHTS AND OBLIGATIONS OF THE PARTIES SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES. ANY SUIT, ACTION OR
PROCEEDING BROUGHT BY THE COMPANY AGAINST THE AGENT IN CONNECTION WITH OR
ARISING UNDER THIS AGREEMENT SHALL BE BROUGHT SOLELY IN THE STATE OR FEDERAL
COURT OF APPROPRIATE JURISDICTION LOCATED IN THE BOROUGH OF MANHATTAN, THE CITY
OF NEW YORK.
SECTION 16. EFFECT OF HEADINGS.
The Article and Section headings herein are for convenience only and
shall not affect the construction hereof.
SECTION 17. COUNTERPARTS.
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.
-22-
If the foregoing is in accordance with the Agent's understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this Distribution Agreement, along with all counterparts, will become a binding
agreement between the Agent and the Company in accordance with its terms.
Very truly yours,
XXX XXXXXXXX XXXXXXX
By: /s/ Xxxx Xxxxxxx
---------------------------------------
Name: Xxxx Xxxxxxx
Title: Vice President and Treasurer
CONFIRMED AND ACCEPTED,
as of the date first above written:
XXXXXXX LYNCH, XXXXXX, XXXXXX & XXXXX
INCORPORATED
By: /s/ Xxxxx Xxxxxxxx
------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Authorized Signatory
SCHEDULE A
The Company shall pay the Agent, on a discount basis, a commission for
the sale of each Note equal to the principal amount of such Note multiplied by
the appropriate percentage set forth below.
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
--------------- ----------------
From 9 months to less than 1 year........................... .20%
From 1 year to less than 18 months.......................... .20%
From 18 months to less than 2 years......................... .20%
From 2 years to less than 3 years........................... .40%
From 3 years to less than 4 years........................... .625%
From 4 years to less than 5 years........................... .75%
From 5 years to less than 6 years........................... 1.00%
From 6 years to less than 7 years........................... 1.10%
From 7 years to less than 10 years.......................... 1.20%
From 10 years to less than 12 years......................... 1.50%
From 12 years to less than 15 years......................... 1.75%
From 15 years to less than 20 years......................... 2.00%
From 20 years to 30 years................................... 2.50%
Greater than 30 years....................................... ____*
----------------------------
* As agreed to by the Company and the Agent at the time of sale.
Sch A-1
EXHIBIT A
FORM OF TERMS AGREEMENT
Xxx Xxxxxxxx Xxxxxxx
Prudential Tower Building
Boston, Massachusetts 02199
The undersigned agrees to purchase the following aggregate principal amount of
Notes:
$____________
The terms of such Notes shall be as follows:
Interest Rate:
Interest Payment Dates:
Initial Redemption Date, if applicable:
Optional Repayment Date(s), if any:
Survivor's Option:
Original Issue Date:
Stated Maturity Date:
Purchase Price:
Price to the Public (% of Principal Xxxxxx):
Purchasing Agent's Discount/Commission:
Net Proceeds to the Company:
Trade Date:
Settlement Date (which shall be the same as the Original Issue Date):
If a Discount Note, the Total Amount of Original Issue Discount, the
Yield to Maturity and the Initial Accrual Period of Original Issue
Discount:
Additional/Other Terms:
XXXXXXX LYNCH, XXXXXX, XXXXXX & XXXXX
INCORPORATED
By: ______________________________________
Authorized Signatory
A-1
ACCEPTED
XXX XXXXXXXX XXXXXXX
---------------------------------
Name:
Title:
A-2
EXHIBIT B
[XXXXXXXX XXXX] FILED UNDER RULE 424(b)(2), REGISTRATION STATEMENT NO. 333-86336
$500,000,000 Pricing Supplement No. __ - dated ________________ ___, 200__
Xxxxxxxx XxxxXxxxx(sm) (To Prospectus dated July 10, 2002, and Prospectus Supplement dated August 23, 2002)
-----------------------------------------------------------------------------------------------------------------------------------
PURCHASING PROCEEDS, INTEREST
AGGREGATE AGENT'S BEFORE INTEREST PAYMENT STATED
PRINCIPAL PRICE TO DISCOUNT/ EXPENSES, TO RATE FREQUENCY MATURITY SURVIVOR'S
CUSIP NUMBER AMOUNT PUBLIC(1) COMMISSION(1) XXXXXXXX(1) PER ANNUM (BEGIN DATE) DATE OPTION
-----------------------------------------------------------------------------------------------------------------------------------
________ $________ ________% ________% ________% ________% ________ ________ [Yes/No]
________
REDEMPTION INFORMATION:
OTHER/ADDITIONAL PROVISIONS:
-----------------------------------------------------------------------------------------------------------------------------------
________ $________ ________% ________% ________% ________% ________ ________ [Yes/No]
________
REDEMPTION INFORMATION:
OTHER/ADDITIONAL PROVISIONS:
-----------------------------------------------------------------------------------------------------------------------------------
________ $________ ________% ________% ________% ________% ________ ________ [Yes/No]
________
REDEMPTION INFORMATION:
OTHER/ADDITIONAL PROVISIONS:
-----------------------------------------------------------------------------------------------------------------------------------
XXXXXXX XXXXX & CO.
Xxx Xxxxxxxx Xxxxxxx Trade Date: Purchasing Agent
Prudential Tower Building Original Issue Date:
Boston, MA 02199 Minimum Denominations/Increments: $1,000/$1,000 Acting as
Original Issue Discount Note: [Yes/No] [Principal/Agent]
All trades settle without accrued interest and clear SDFS: DTC Book-Entry only
Xxxxxxx Xxxxx DTC Participant Number: 5132
(1) Expressed as a percentage of the aggregate principal amount.
"CoreNotes(sm)" is a service mark of Xxxxxxx Xxxxx & Co., Inc.
-----------------------------------------------------------------------------------------------------------------------------------
B-1
EXHIBIT C
XXX XXXXXXXX XXXXXXX
Administrative Procedures for Xxxxxxxx XxxxXxxxx(SM)
Due Nine Months or More from the Date of Issue
August 23, 2002
-------------
Xxxxxxxx XxxxXxxxx(SM) Due Nine Months or More from the Date of Issue
(the "Notes") are being offered on a continuing basis by Xxx Xxxxxxxx Xxxxxxx
(the "Company"). The Notes will be sold to or through Xxxxxxx Lynch, Xxxxxx,
Xxxxxx & Xxxxx Incorporated, as purchasing agent (the "Purchasing Agent" or
"Xxxxxxx Xxxxx") pursuant to a Distribution Agreement, to be dated as of August
23, 2002, between the Company and Xxxxxxx Xxxxx (the "Distribution Agreement")
and, if applicable, one or more terms agreements, substantially in the form
attached to the Distribution Agreement as Exhibit A (each, a "Terms Agreement").
The Notes, if purchased by the Purchasing Agent as principal, will be resold by
the Purchasing Agent to (i) customers of the Purchasing Agent or (ii) selected
broker-dealers (the "Selling Group") for distribution to their customers
pursuant to a Master Selected Dealers Agreement (the "Dealers Agreement"). The
Notes will be unsecured and unsubordinated debt and have been registered with
the Securities and Exchange Commission (the "SEC"). Bank One, N.A. (the
"Trustee") is the trustee under the Indenture, dated as of April 11, 2002, as
supplemented by that certain Second Supplemental Indenture, to be dated as of
August 23, 2002, and as further amended or supplemented from time to time
hereafter (collectively, the "Indenture"), between the Company and the Trustee
covering the Notes.
The Notes will be issued in book-entry form and represented by one or
more fully registered global notes without coupons (each, a "Global Note") held
by the Trustee, as agent for The Depository Trust Company ("DTC"), and recorded
in the book-entry system maintained by DTC. Owners of beneficial interests in a
Global Note will be entitled to physical delivery of Notes issued in
certificated form equal in principal amount to their respective beneficial
interests only upon certain limited circumstances described in the Prospectus.
Each Note will have the maturity ranges, interest rates and other terms set
forth in the relevant Pricing Supplement (as defined in the Distribution
Agreement).
Administrative procedures and specific terms of the offering are
explained below. These administrative procedures are intended to be a general
guide to the operation of the Program (as defined in the Distribution
Agreement). The actual operational procedures and Settlement Procedures (as
defined below) for a particular offering of Notes may differ from time to time.
Administrative responsibilities will be handled for the Company by its
Treasurer's Office; accountable document control and record-keeping
responsibilities will be performed by the Company's Treasury Control Department.
C-1
Notes will be issued in accordance with the administrative procedures
set forth herein, as they may be subsequently amended as a result of changes in
DTC's operating procedures. To the extent the procedures set forth below
conflict with or omit certain of the provisions of the Notes, the Indenture, the
Distribution Agreement, the Prospectus, the Prospectus Supplement (the
Prospectus and the Prospectus Supplement, in each case, as most recently amended
or supplemented, are, together, hereinafter referred to as the "Prospectus") or
the applicable Pricing Supplement, the relevant provisions of the Notes, the
Indenture, the Distribution Agreement, the Prospectus or the Pricing Supplement,
as the case may be, shall control. Capitalized terms used herein that are not
otherwise defined shall have the meanings ascribed thereto in the Distribution
Agreement, the Prospectus or in the Indenture.
C-2
PROCEDURES FOR NOTES ISSUED IN BOOK ENTRY FORM
In connection with the qualification of 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 obligations under a Letter of Representations from the Company and the
Trustee to DTC, to be dated as of August 23, 2002, and a Medium-Term Note
Certificate Agreement between the Trustee and DTC (the "Certificate Agreement"),
dated as of May 26, 1989, and its obligations as a participant in DTC, including
DTC's Same-Day Funds Settlement system ("SDFS"). The procedures set forth below
may only be amended by the agreement of the Company, the Purchasing Agent and
the Trustee.
Maturities: Each Note will have a maturity of nine months or more from the
date of issue (the "Stated Maturity Date"), as specified in
the applicable Pricing Supplement, unless the principal of the
Note, or any installment of principal, becomes due and payable
prior to the Stated Maturity Date. This could happen as a
result of the declaration of acceleration of maturity,
redemption at the option of the Company, or repayment at the
option of the purchaser (or its authorized representative).
The applicable Pricing Supplement will state whether the Notes
are subject to redemption or repayment prior to their Stated
Maturity at the option of the Company or the purchaser (or its
authorized representative), respectively, and specify the date
or dates (respectively, a "Redemption Date" and "Repayment
Date") on which such redemption or repayment may be made.
Issuance: All Notes having the same terms, including the same Original
Issue Date (as hereinafter defined), interest rate, interest
payment frequency, Stated Maturity Date, and redemption and
repayment terms, if any, will be represented initially by a
single Global Note. Each Global Note will be dated and issued
as of the date of its authentication by the Trustee.
Each Global Note will bear an original issue date (the
"Original Issue Date"). The Original Issue Date shall remain
the same for all Notes subsequently issued upon registration
of transfer, exchange or substitution of an original Note,
regardless of their dates of authentication.
Identification: The Company has received from the CUSIP Service Bureau (the
"CUSIP Service Bureau") of Standard & Poor's Corporation
("Standard & Poor's") one series of CUSIP numbers consisting
of approximately 900 CUSIP numbers for future assignment to
Global Notes representing Notes. The Company will provide DTC
and the Trustee with a list of such CUSIP numbers. The Company
will assign CUSIP numbers 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 Notes. The Trustee will notify the Company
at any time when fewer than 100 of the reserved CUSIP numbers
remain unassigned to
C-3
Global Notes and the Company, if it deems necessary, will
reserve additional CUSIP numbers for assignment to Global
Notes representing Notes and will provide the Trustee and DTC
with the list of additional CUSIP numbers so obtained.
Registration: Unless otherwise specified by DTC, each Global Note will be
registered in the name of CEDE & Co., as nominee for DTC, on
the Security Register maintained under the Indenture by the
Trustee. The beneficial owner of a Note (i.e., an owner of a
beneficial interest in a Global 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 of such Note in the
account of such Participants. The ownership interest of such
beneficial owner's interest 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 interests in a Global Note will be accomplished
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 interests.
Exchanges: The Trustee, at the Company's request, may deliver to DTC and
the CUSIP Service Bureau at any time a written notice of
consolidation specifying (a) the CUSIP numbers of two or more
Global Notes Outstanding on such date that represent Notes
having the same terms (except that Original Issue Dates need
not be the same) and for which interest has been paid to the
same date and which otherwise constitute Notes of the same
series and tenor under the Indenture, (b) a date, occurring at
least 30 days after such written notice is delivered and at
least 30 days before the next Interest Payment Date for the
related Notes, on which such Global Notes shall be exchanged
for a single replacement Global Note; and (c) a new CUSIP
number, obtained from the Company, to be assigned to such
replacement Global Note. 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 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 Notes to be exchanged will no longer be
valid. On the specified exchange date, the Trustee will
exchange such Global Notes for a single Global Note bearing
the new CUSIP number. The CUSIP numbers of the exchanged
Global Notes will, in accordance
C-4
with CUSIP Service Bureau procedures, be cancelled and not
immediately reassigned. Notwithstanding the foregoing, if the
Global Notes to be exchanged exceed $400,000,000 in aggregate
principal or face amount, one replacement Global Note will be
authenticated and issued to represent each $400,000,000 of
principal or face amount of the exchanged Global Notes and an
additional Global Note will be authenticated and issued to
represent any remaining principal amount of such Global Notes
(See "Denominations" below).
Issue Price: Unless otherwise specified in an applicable Pricing
Supplement, each Note will be issued at the percentage of the
initial offering price specified in the Prospectus relating to
such Note.
Denominations: Notes will be issued in denominations of $1,000 or any amount
in excess thereof which is an integral multiple of $1,000.
Global Notes will be denominated in principal or face amounts
not in excess of $400,000,000. If one or more Notes having an
aggregate principal or face amount in excess of $400,000,000
would, but for the preceding sentence, be represented by a
single Global Note, then one Global Note will be issued to
represent each $400,000,000 principal or face amount of such
Note or Notes and an additional Global Note will be issued to
represent any remaining principal amount of such Note or
Notes. In such a case, each of the Global Notes representing
such Note or Notes shall be assigned the same CUSIP number.
Interest: GENERAL. Each Note will bear interest at a fixed rate per
annum set forth thereon and specified in the applicable
Pricing Supplement. The interest rates the Company will agree
to pay on newly-issued Notes are subject to change without
notice by the Company from time to time, but no such change
will affect any Notes already issued or as to which an offer
to purchase has been accepted by the Company.
Each Note will bear interest from and including its Original
Issue Date until the principal amount thereof is paid, or
otherwise made available for payment, in full. Interest on
each Note will accrue from and including its Original Issue
Date for the first interest period and from and including the
most recent Interest Payment Date to which interest has been
paid or otherwise made available for payment for all
subsequent interest periods. Except as set forth hereafter,
each payment of interest on a Note will include interest
accrued to but excluding, as the case may be, the applicable
Interest Payment Date or the date of Maturity.
DTC will arrange for each pending deposit message described
under Settlement Procedure "C" below to be transmitted to
Standard & Poor's which will use the information in the
message to include certain terms of the related Global Note in
the appropriate daily bond report published by Standard &
Poor's.
C-5
INTEREST PAYMENTS. Unless otherwise specified in the
applicable Pricing Supplement, Interest on each Note will be
payable either monthly, quarterly, semiannually or annually on
each Interest Payment Date and at Maturity to the persons in
whose names the Note is registered at the close of business on
the Regular Record Date next preceding each Interest Payment
Date; PROVIDED, HOWEVER, that Interest payable at Maturity
will be payable to the Person to whom the principal of such
Note is payable. The Regular Record Date with respect to any
Interest Payment Date will be the first day of the calendar
month in which the related Interest Payment Date occurs.
Unless otherwise indicated in the applicable Pricing
Supplement, the first Interest Payment Date for a Global Note
originally issued between an Interest Payment Date and the
related Regular Record Date shall be the Interest Payment Date
next following such Interest Payment Date.
The specific terms of each such Note will be set out in detail
in the applicable Pricing Supplement. The "Interest Payment
Dates" for Notes will be as follows:
INTEREST PAYMENT INTEREST PAYMENT DATES
FREQUENCY
Monthly: 15th day of each calendar month, beginning
in the first calendar month following the
month in which the Note was issued.
Quarterly: 15th day of every third month, beginning in
the third calendar month following the month
in which the Note was issued.
Semiannual: 15th day of every sixth month, beginning in
the sixth calendar month following the month
in which the Note was issued.
Annual: 15th day of every twelfth month, beginning
in the twelfth calendar month following the
month in which the Note was issued.
Calculation of Interest on each Note (including payments for partial periods)
Interest: will be calculated on the basis of a 360-day year of twelve
30-day months.
Business Day: "Business Day" means any day, other than a Saturday or Sunday,
that is neither a legal holiday nor a day on which commercial
banks are authorized or required by law, regulation or
executive order to close in The City of New York.
Redemption/ Notes are subject to redemption or repayment prior to their
Repayment: Stated Maturity only as described in the Prospectus and the
applicable Pricing Supplement. Unless a Note indicates that
the survivor's option shall not apply, the survivor's option
shall be deemed to apply to any such Note.
C-6
Payments of PAYMENTS OF INTEREST ONLY. Promptly after each Regular Record
Principal and Date, the Trustee will deliver to the Company and DTC a
Interest: written notice specifying by CUSIP number the amount of
interest to be paid on each Global Note on the following
Interest Payment Date (other than an Interest Payment Date
coinciding with Maturity) and the total of such amounts. DTC
will confirm the amount payable on each Global Note on such
Interest Payment Date by reference to the daily bond reports
published by Standard & Poor's. On such Interest Payment Date,
the Company will pay to the Trustee in immediately available
funds, and the Trustee in turn will pay to DTC, such total
amount of interest due at the times and in the manner set
forth below under "Manner of Payment." If any Interest Payment
Date for any Note is not a Business Day, the payment due on
such day shall be made on the next succeeding Business Day and
no additional interest shall accrue on such payment made on
that next succeeding Business Day.
PAYMENTS AT MATURITY. 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 Note representing Notes maturing or subject to
redemption or repayment in the following month. The Trustee,
the Company and DTC will confirm the amounts of such principal
and interest payments with respect to each Global Note on or
about the fifth Business Day preceding the Maturity of such
Global Note. At Maturity, the Company will pay to the Trustee
in immediately available funds, and the Trustee in turn will
pay to DTC, the principal of such Global Note, together with
any interest due at such Maturity at the times and in the
manner set forth below under "Manner of Payment." If the
Maturity of a Global Note does not occur on a Business Day,
the payment due on such day shall be made on the next
succeeding Business Day and no additional interest shall
accrue on such payment made on that next succeeding Business
Day. Promptly after payment by the Company of the principal
and interest due at Maturity of such Global Note and all other
Notes represented by such Global Note, the Trustee will cancel
and destroy such Global Note in accordance with the Indenture
and so advise the Treasurer's Office of the Company.
MANNER OF PAYMENT. The total amount of principal and interest
due on Global Notes on any Interest Payment Date or at
Maturity shall be paid by the Company to the Trustee in
immediately available funds for use by the Trustee on such
date. For payments at Maturity: prior to 11:00 A.M., New York
City time, on such date or as soon as possible thereafter, the
Trustee will make payment to DTC in accordance with existing
arrangements between the Trustee and DTC, in funds available
for immediate use by DTC, each payment of principal and
interest due in U.S. dollars on a Global Note on such date.
For Interest Payment Dates (other than at
C-7
Maturity): the Trustee will pay DTC each payment of interest
in U.S. dollars in same-day funds in accordance with existing
arrangements between the Trustee and DTC. Thereafter, on each
such payment date (whether at Maturity or on an Interest
Payment 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
with payments in amounts proportionate to their respective
holdings in principal amount of beneficial interest in such
Global Note as are recorded in the book-entry system
maintained by DTC. Neither the Company nor the Trustee shall
have any direct responsibility or liability for the payment in
U.S. dollars by DTC of the principal of or interest on, the
Notes to such Participants.
WITHHOLDING TAXES. The amount of any taxes required under
applicable law to be withheld from any interest payment on a
Note will be determined and withheld by the Participant,
indirect participant in DTC or other Person responsible for
forwarding payments and materials directly to the beneficial
owner of such Note.
Procedure for The Company and the Purchasing Agent will discuss,
Rate Setting from time to time, the aggregate principal amounts of,
and Posting: the Stated Maturity Dates, the prices to the public and the
interest rates to be borne by Notes that may be sold as a
result of the solicitation of orders by the Purchasing Agent.
If the Company decides to set interest rates borne by any
Notes in respect of which the Purchasing Agent is to solicit
orders (the setting of such interest rates to be referred to
herein as "Posting") or if the Company decides to change
interest rates previously posted, it will promptly advise the
Purchasing Agent of the prices and interest rates to be
posted. The Company will assign a separate CUSIP number for
each tranche of Notes to be posted, and will so advise and
notify the Trustee and Purchasing Agent of said assignment in
writing (including by facsimile or e-mail transmission). The
Purchasing Agent will, in turn, include the assigned CUSIP
number on all Posting notices communicated to Selling Group
members.
Offering of In the event that there is a Posting, the Purchasing Agent
Notes: will communicate to each Selling Group member the terms of
each tranche of Notes that is the subject of the Posting,
including, without limitation, the aggregate principal amount,
the Stated Maturity Date, the price to the public and the
interest rate. Thereafter, the Purchasing Agent, along with
the Selling Group, will solicit offers to purchase the Notes
accordingly.
C-8
Purchase of No later than 1:00 p.m. (New York City time) on the fourth day
Notes by the subsequent to the day on which such Posting occurs, or if such
Purchasing fourth day is not a Business Day, on the preceding Business
Agent as Day, or on such other Business Day and time as shall be
Principal: mutually agreed upon by the Company and the Purchasing Agent
(any such day, a "Trade Date"), the Purchasing Agent will
confirm to the Company in writing (including by facsimile or
e-mail transmission) for each tranche of Notes that the
Purchasing Agent is offering to purchase as principal the
terms of such offer as set forth in the form of terms
agreement attached to the Distribution Agreement as Exhibit A.
For purposes of the Distribution Agreement and these
administrative procedures, such written confirmation, if
accepted by the Company as described under the heading
"Acceptance and Rejection of Orders" below, will constitute a
"Terms Agreement."
Purchase of If agreed upon by the Purchasing Agent and the Company, the
Notes through Purchasing Agent, acting solely as agent for the Company and
the Agent not as principal, will solicit offers for the purchase of
Acting as Agent: Notes. The Purchasing Agent has 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 will not be
deemed a breach of the Purchasing Agent's agreement contained
in the Distribution Agreement. In accordance with the
procedures described under Settlement Procedure "A" below, the
Purchasing Agent will promptly communicate to the Company, and
confirm in writing (including by facsimile or e-mail
transmission), each offer for the purchase of Notes solicited
and received by it on an agency basis other than those offers
rejected by the Purchasing Agent in the reasonable exercise of
its discretion.
Acceptance and Upon receipt from the Purchasing Agent of an offer to purchase
Rejection of Notes as principal as described under the heading "Purchase of
Orders: Notes by the Purchasing Agent as Principal" above, the
Company will no later than 4:00 p.m. (New York City time) of
the day on which the Company receives such offer (i) confirm
to the Purchasing Agent in writing (including by facsimile or
e-mail transmission) its acceptance, in whole or in part, of
such offer to purchase as principal the Notes of a particular
tranche or (ii) inform the Purchasing Agent in writing
(including by facsimile or e-mail transmission) that its offer
to purchase as principal the Notes of a particular tranche has
been rejected, in whole or in part. The Purchasing Agent will
thereafter promptly inform the participating Selling Group
members of the action taken by the Company.
C-9
The Company has the sole right to accept all orders to
purchase Notes (whether from the Purchasing Agent as principal
or through the Purchasing Agent as agent) and may reject any
such order in whole or in part.
No order for less than $1,000 principal amount of Notes will
be accepted.
Preparation If any offer to purchase a Note is accepted by the Company,
of Pricing the Company will prepare a Pricing Supplement (substantially
Supplement: in the form attached to the Distribution Agreement as
Exhibit B) to the Prospectus reflecting the terms of such
Note. The Company will (i) file any such Pricing Supplement
with the SEC in accordance with the applicable paragraph of
Rule 424(b) under the Act and (ii) subject to the immediately
following sentence, no later than 11:00 a.m., New York City
time, on the Business Day following the Trade Date, deliver to
the Purchasing Agent a copy of such Pricing Supplement in PDF
format by e-mail to the following addresses:
xxxxxxxx@xx0.xx.xx.xxx, xxxxxxxx@xxxxxxxx.xx.xxx and
xxxxxx@xxxxxxxx.xx.xxx. If Settlement Procedures "A" and "B"
below with respect to a particular offer are not completed on
or before the respective times set forth under the heading
"Settlement Procedures Timetable" below, the Company will
deliver to the Purchasing Agent a copy of such Pricing
Supplement in the manner described in clause (ii) of the
immediately preceding sentence no later than 11:00 a.m., New
York City time, on the Business Day following the completion
of Settlement Procedures "A" and "B" below.
Subject to the provisions described under the heading
"Suspension of Solicitation; Amendment or Supplement" below,
the Purchasing Agent will cause such Pricing Supplement,
together with a copy of the Prospectus, as most recently
amended or supplemented, to accompany each written
confirmation of a sale sent to the purchaser of the Notes or
his or her agent.
Outdated Pricing Supplements (other than those retained for
files) will be destroyed.
Delivery of For each offer to purchase a Note solicited by the Purchasing
Confirmation Agent and accepted by the Company, the Purchasing Agent will
and Prospectus issue a written confirmation to the forth the terms of such
to Purchaser Note and other applicable details purchaser setting described
by Purchasing above and delivery and payment instructions. In addition,
Agent: subject to the provisions described under the heading
"Suspension of Solicitation; Amendment or Supplement" below,
the Purchasing Agent will deliver or cause to be delivered to
the purchaser the Prospectus, as most recently amended or
supplemented, together with the applicable Pricing Supplement,
prior to or together with the earliest of any written offer
related to the sale of such Note, delivery of the confirmation
of sale or delivery of the Note.
C-10
Settlement: The receipt of immediately available funds by the Company in
payment for Notes and the authentication and issuance of the
Global Note representing such Notes shall constitute
"Settlement" with respect to such Notes. All orders accepted
by the Company will be settled generally within three Business
Days of the Trade Date pursuant to the timetable for
Settlement set forth below, unless the Company and the
purchaser agree to Settlement on a later date, and shall be
specified upon acceptance of such offer; PROVIDED, HOWEVER, In
all cases the Company will notify the Trustee of the date of
Settlement no later than the Business Day following the Trade
Date.
If Settlement Procedures "A" and "B" below with respect to a
particular offer are not completed on or before the respective
times set forth under the heading "Settlement Procedures
Timetable" below, such offer, if accepted by the Company, will
not be settled until the third Business Day following the
completion of Settlement Procedures "A" and "B" below or such
later date as the purchaser and the Company may agree.
Settlement In the event of a purchase of Notes by the Purchasing Agent,
Procedures: as principal, appropriate Settlement details, if different
from those set forth below with regard to Notes sold through
the Purchasing Agent, acting solely as agent for the Company
and not as principal, will be set forth in the applicable
Terms Agreement, except that (a) in lieu of delivering the
Note Sale Information required in Settlement Procedure "A"
below, the details of the terms of such offer will be
delivered to the Company in the manner described under the
heading "Purchase of Notes by the Purchasing Agent as
Principal" above and (b) Settlement Procedure "H" below shall
not apply.
Settlement Procedures with regard to each Note sold through
the Purchasing Agent, acting solely as agent for the Company
and not as principal, shall be as follows:
A. The Purchasing Agent will promptly communicate to the
Company, and confirm in writing (including by
facsimile or e-mail transmission), each offer for the
purchase of Notes solicited and received by it on an
agency basis other than those offers rejected by the
Purchasing Agent in the reasonable exercise of its
discretion. Such written communication will include
the following details of the terms of the offer (the
"Note Sale Information"):
1. Principal amount of the purchase;
C-11
2. Interest rate;
3. Interest payment dates
4. If the Note is redeemable by the Company,
the initial redemption date;
5. If the Note is subject to repayment at the
option of its owner, the optional repayment
dates;
6. Whether the Note is subject to a survivor's
option;
7. Original Issue Date;
8. Stated Maturity Date;
9. Price to public (% of principal amount);
10. Purchasing Agent's discount/commission
determined pursuant to the Distribution
Agreement;
11. Net proceeds to the Company;
12. Trade Date;
13. Settlement Date (which shall be the Original
Issue Date);
14. If a discount Note, the total amount of
original issue discount, the yield to
maturity and the initial accrual period of
original issue discount;
15. DTC Participant Number of the institution
through which the purchaser will hold the
beneficial interest in the Global Note; and
16. Such other terms as are necessary to
complete the applicable form of Note.
In accordance with the procedures described under the heading
"Acceptance and Rejection of Orders" above, the Company will
notify the Purchasing Agent in writing (including by facsimile
or e-mail transmission) whether an offer to purchase Notes has
been accepted or rejected, in whole or in part, and, if the
offer is accepted, will confirm its agreement with the Note
Sale Information (or, in the event of a purchase of Notes by
the Purchasing Agent, as principal, its acceptance of the
Terms Agreement). To the extent that an offer is accepted by
the Company, whether in whole or in part, Settlement
Procedures "B" through "M" described below shall apply.
C-12
B. The Company will confirm the previously assigned
CUSIP number to the Global Note representing such
Note and then advise the Trustee and the Purchasing
Agent in writing (including by facsimile or e-mail
transmission) at any time on the same date that the
Note Sale Information (or, in the event of a purchase
of Notes by the Purchasing Agent, as principal, the
Terms Agreement) is delivered to the Company of the
assigned CUSIP number to the Global Security
representing the Note.
C. The Trustee will communicate to DTC and the
Purchasing Agent through DTC's Participant Terminal
System, a pending deposit message specifying the
following Settlement information:
1. The Note Sale Information (or, in the event
of a purchase of Notes by the Purchasing
Agent, as principal, the information set
forth in the Terms Agreement);
2. The numbers of the participant accounts
maintained by DTC on behalf of the Trustee
and the Purchasing Agent;
3. The initial Interest Payment Date for such
Note, number of days by which such date
succeeds the related DTC record date (which
term means the Regular Record Date), and, if
then calculated, the amount of interest
payable on such Initial Interest Payment
Date (which amount shall have been confirmed
by the Trustee);
4. The CUSIP number of the Global Note
representing such Notes;
5. The frequency of Interest Payment Dates; and
6. Whether such Global Note represents any
other Notes issued or to be issued (to the
extent then known).
D. The Company will complete and deliver to the Trustee
a Global Note representing such Note in a form that
has been approved by the Company, the Purchasing
Agent and the Trustee.
E. The Trustee will authenticate the Global Note
representing such Note and maintain possession of
such Global Note.
F. DTC will credit such Note to the participant account
of the Trustee maintained by DTC.
G. The Trustee will enter an SDFS deliver order through
DTC's Participant Terminal System instructing DTC to
(i) debit such Note to
C-13
the Trustee's participant account and credit such
Note to the participant account of the Purchasing
Agent maintained by DTC and (ii) debit the settlement
account of the Purchasing Agent and credit the
settlement account of the Trustee maintained by DTC,
in an amount equal to the price to the public of such
Note less the Purchasing Agent's commission (or, in
the event of a purchase of Notes by the Purchasing
Agent, as principal, an amount equal to the price to
the public of such Note less the Purchasing Agent's
discount). The entry of such a deliver order shall be
deemed to constitute a representation and warranty by
the Trustee to DTC that (a) the Global Note
representing such Note has been issued and
authenticated and (b) the Trustee is holding such
Global Note pursuant to the Certificate Agreement.
H. The Purchasing Agent will enter an SDFS deliver order
through DTC's Participant Terminal System instructing
DTC to (i) debit such Note to the Purchasing Agent's
participant account and credit such Note to the
participant accounts of the Participants to whom such
Note is to be credited maintained by DTC and (ii)
debit the settlement accounts of such Participants
and credit the settlement account of the Purchasing
Agent maintained by DTC, in an amount equal to the
price to the public of the Note so credited to their
accounts.
I. Transfers of funds in accordance with SDFS deliver
orders described in Settlement Procedures "G" and "H"
will be settled in accordance with SDFS operating
procedures in effect on the Settlement Date.
J. The Trustee will credit to an account of the Company
maintained at Bank One: ABA 000000000, funds
available for immediate use in an amount equal to the
amount credited to the Trustee's DTC participant
account in accordance with Settlement Procedure "G".
K. The Trustee will send a copy of the Global Note
representing such Note by first-class mail to the
Company.
L. The Purchasing Agent will confirm the purchase of
each Note to the purchaser thereof either by
transmitting to the Participant to whose account such
Note has been credited a confirmation order through
DTC's Participant Terminal System or by mailing a
written confirmation to such purchaser. In all cases
and subject to the provisions described under the
heading "Suspension of Solicitation; Amendment or
Supplement" below,, the Purchasing Agent will cause
the Prospectus, as most recently amended or
supplemented, together with the applicable Pricing
Supplement, to accompany or precede such
confirmation.
M. The Trustee will send to the Company a statement
setting forth the principal amount of Notes
outstanding as of that date under the
C-14
Indenture and setting forth the CUSIP number(s)
assigned to, and a brief description of, any orders
which the Company has advised the Trustee but which
have not yet been settled.
Settlement In the event of a purchase of Notes by the Purchasing Agent,
Procedures as principal, appropriate Settlement details, if different
Timetable: from those details set forth below, will be set forth
in the applicable Terms Agreement. For orders of Notes
solicited by the Purchasing Agent, acting solely as agent for
the Company and not as principal, and accepted by the Company,
Settlement Procedures "A" through "M" shall be completed as
soon as possible but not later than the respective times (in
each case, New York City time) set forth below:
SETTLEMENT
PROCEDURE TIME
---------- ----
A The Purchasing Agent will deliver the Note
Sale Information (or, in the event of a
purchase of Notes by the Purchasing Agent,
as principal, the offer to purchase Notes as
principal as described under the heading
"Purchase of Notes by the Purchasing Agent
as Principal" above) by 1:00 p.m. on the
Trade Date. The Company will notify the
Purchasing Agent of acceptance or rejection
by 4:00 p.m. on the Trade Date.
B 5:00 p.m. on the Trade Date.
C 2:00 p.m. on the Business Day immediately
preceding the Settlement Date.
D 12:00 p.m. on the Settlement Date.
E 12:30 p.m. on the Settlement Date.
F 1:00 p.m. on the Settlement Date.
G-H 2:00 p.m. on the Settlement Date.
I 4:45 p.m. on the Settlement Date.
X-X 5:00 p.m. on the Settlement Date.
M On the first Business Day of each month or
at the request of the Company.
NOTE: The Prospectus, as most recently amended or
supplemented, together with the applicable Pricing Supplement,
must accompany or precede any written confirmation given/sent
to the purchaser (Settlement Procedure "L"). Settlement
Procedure "I" is subject to extension in accordance with any
extension of Fedwire closing deadlines and in accordance with
the other events specified in the SDFS operating procedures in
effect on the Settlement Date.
C-15
If Settlement of a Note is rescheduled or cancelled, the
Trustee 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 Day
immediately preceding the scheduled Settlement Date.
Failure to If the Trustee fails to enter an SDFS deliver order with
Settle: respect to a Note pursuant to Settlement Procedure "G", 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 participant account
of the Trustee maintained at DTC. DTC will process the
withdrawal message, provided that such participant account
contains Notes having the same terms and having a principal
amount that is at least equal to the principal amount of such
Note to be debited. If withdrawal messages are processed with
respect to all the Notes issued or to be issued represented by
a Global Note, the Trustee will cancel such Global Note in
accordance with the Indenture, make appropriate entries in its
records and so advise the Treasury Control Department of the
Company. The CUSIP number assigned to such Global Note shall,
in accordance with CUSIP Service Bureau procedures, be
cancelled and not immediately reassigned. If withdrawal
messages are processed with respect to one or more, but not
all, of the Notes represented by a single Global Note, the
Trustee will exchange such Global Note for two Global Notes,
one of which shall represent such Notes to which the
withdrawal message relates and shall be cancelled immediately
after issuance, and the other of which shall represent the
remaining Notes previously represented by the surrendered
Global Note and shall bear the CUSIP number of the surrendered
Global Note. If the purchase price for any 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 Purchasing
Agent may enter SDFS deliver orders through DTC's participant
Terminal System reversing the orders entered pursuant to
Settlement Procedures "G" and "H", respectively. Thereafter,
the Trustee will deliver the withdrawal message and take the
related actions described in the preceding paragraph. The
Purchasing Agent shall make reasonable efforts to assist the
Company in obtaining performance by each purchaser whose offer
for the purchase of Notes has been solicited by it and
accepted by the Company.
Notwithstanding the foregoing, upon any failure to settle with
respect to a 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 Notes that were to have been represented by a Global Note,
the Trustee will provide, in accordance with Settlement
Procedures "E" and "F", for the authentication and issuance of
a Global Note representing the other Notes to have been
represented by such Global Note and will make appropriate
entries in its records.
C-16
Procedure Each time a decision has been reached to change rates, the
for Rate Company will promptly advise the Purchasing Agent of the
Changes: new rates, who will forthwith suspend solicitation of
purchases of Notes at the prior rates. The Purchasing Agent
shall telephone the Company with recommendations as to the
changed interest rates.
Suspension of The Company reserves the right, in its sole discretion, to
Solicitation; suspend solicitation of offers for the purchase of Notes
Amendment or through the Purchasing Agent, as an agent of the Company,
Supplement: time or permanently. As soon as practicable after receipt of
instructions from the Company, but in any event not later than
one Business Day after receipt of such instructions from the
Company, the Purchasing Agent will suspend solicitation of
offers for the purchase of Notes from the Company until such
time as the Company has advised the Purchasing Agent that such
solicitation may be resumed. In the event that at the time the
Purchasing Agent suspends solicitation of purchases there
shall be any orders outstanding for settlement, the Company
will, consistent with its obligations under the Distribution
Agreement, promptly advise the Purchasing Agent whether such
orders may be settled and whether copies of the Prospectus, as
in effect at the time of the suspension, together with the
applicable 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
which 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.
Trustee Not to Nothing herein shall be deemed to require the Trustee to risk
Risk Funds: or expend its own funds in connection with any payment to the
Company, or the Purchasing Agent or the purchasers, it being
understood by all parities that payments made by the Trustee
to either the Company or the Purchasing Agent shall be made
only to the extent that funds are provided to the Trustee for
such purpose.
Advertising: The Company shall have the sole right to approve in advance
the form and substance of any advertising the Purchasing Agent
may propose to initiate in connection with the Purchasing
Agent's solicitation of offers to purchase the Notes.
C-17
EXHIBIT D
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)(1)
(1) The Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the State of Delaware.
(2) The Company has corporate power and authority to own its
properties and to conduct its business as described in the Prospectus and to
enter into the Distribution Agreement and consummate the transactions
contemplated thereby.
(3) The Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to so qualify or
be in good standing would not result in a Material Adverse Effect.
(4) The Distribution Agreement has been duly authorized, executed
and delivered by the Company.
(5) The Indenture has been duly authorized, executed and delivered
by the Company and (assuming due authorization, execution and delivery thereof
by the Trustee) constitutes a valid and legally binding agreement of the
Company, enforceable against the Company in accordance with its terms, except as
the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, fraudulent conveyance or transfer, moratorium or other similar
laws affecting the enforcement of creditors' rights generally or by general
equitable principles (regardless of whether enforcement is considered in a
proceeding in equity or at law).
(6) The Program has been duly authorized by the Company and the
Notes, when duly authorized, issued, authenticated and delivered in the manner
provided for in the Indenture (assuming due authorization, execution and
delivery of the Indenture by the Trustee and the authentication of the Notes by
the Trustee) and delivered against payment of the consideration therefor, will
constitute valid and legally binding obligations of the Company, enforceable
against the Company in accordance with their terms, and each registered holder
of the Notes will be entitled to the benefits of the Indenture, except as the
enforcement thereof may be limited by bankruptcy, insolvency, reorganization,
fraudulent conveyance or transfer, moratorium or other similar laws affecting
the enforcement of creditors' rights generally or by general equitable
principles (regardless of whether enforcement is considered in a proceeding in
equity or at law).
(7) The Indenture and the Notes conform in all material respects
to the descriptions thereof contained in the Prospectus and are substantially in
the form filed or incorporated by reference, as the case may be, as an exhibit
to the Registration Statement.
D-1
(8) The statements in the Prospectus under "Description of Debt
Securities" and "Description of the Notes" and the statements in the
Registration Statement in Item 15, insofar as such statements constitute a
summary of the terms of the Notes, legal matters, documents or proceedings
referred to therein, fairly present the information relating to such terms,
legal matters, documents or proceedings.
(9) The Company is not, nor with the giving of notice or lapse of
time or both would it be, in violation of or in default under, its Certificate
of Incorporation or By-Laws or any indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument known to me, which is material to the
Company and its consolidated subsidiaries, taken as a whole, and to which the
Company is a party or by which the Company is bound or to which any of the
property or assets of the Company is subject, which is material to the Company
and its consolidated subsidiaries, taken as a whole, except for violations and
defaults which individually or in the aggregate would not result in a Material
Adverse Effect; and the execution, delivery and performance by the Company of
its obligations under the Distribution Agreement, the Indenture and the Notes
and the consummation of the transactions contemplated in the Distribution
Agreement will not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known to me, which is
material to the Company and its consolidated subsidiaries, taken as a whole, and
to which the Company is a party or by which the Company is bound or to which any
of the property or assets of the Company is subject, which is material to the
Company and its consolidated subsidiaries, taken as a whole, nor will any such
action result in any violation of the provisions of the Certificate of
Incorporation or By-Laws of the Company or any applicable law, statute, rule,
regulation, judgment, order, writ or decree of any government, government
instrumentality or court, domestic or foreign, having jurisdiction over the
Company, its Significant Subsidiaries or any of their respective property or
assets.
(10) To the best of my knowledge and other than as set forth or
contemplated in the Prospectus or the documents incorporated by reference
therein, there are no legal or governmental proceedings pending or threatened to
which the Company is or is reasonably likely to become a party or to which any
property or assets of the Company is reasonably likely to become the subject,
that, if determined adversely to the Company, could individually or in the
aggregate reasonably be expected to result in a Material Adverse Effect or which
might reasonably be expected to materially and adversely affect the consummation
of the transactions contemplated in the Distribution Agreement or the
performance by the Company of its obligations thereunder.
(11) I do not know of any contracts or other documents of a
character required to be described in the Registration Statement or Prospectus
or to be filed as exhibits to the Registration Statement that are not described
therein or filed therewith or incorporated by reference therein as so required.
(12) The Registration Statement has been declared effective under
the 1933 Act; any required filing of the Prospectus pursuant to Rule 424(b)
(other than the filing of any Pricing Supplement) has been made in the manner
and within the time period required by Rule 424(b); and, to the best of my
knowledge, no stop order suspending the effectiveness of the Registration
Statement has been issued under the 1933 Act and no proceedings for that purpose
have been instituted or are threatened by the Commission.
D-2
(13) The Registration Statement and the Prospectus, excluding the
documents incorporated by reference therein, and each amendment or supplement to
the Registration Statement and Prospectus, excluding the documents incorporated
by reference therein, as of their respective effective or issue dates (other
than the financial statements, supporting schedules and other financial data
included therein or omitted therefrom and the Form T-1, as to which I express no
opinion), complied as to form in all material respects with the requirements of
the 1933 Act and the 1933 Act Regulations.
(14) The documents incorporated by reference in the Prospectus
(other than the financial statements, supporting schedules and other financial
data included therein or omitted therefrom, as to which I express no opinion),
when they were filed with the Commission, complied as to form in all material
respects with the requirements of the 1934 Act and the 1934 Act Regulations.
(15) The Indenture has been duly qualified under the 1939 Act.
(16) The Company is not, and upon the issuance and sale of the
Notes and the application of the net proceeds therefrom as described in the
Prospectus will not be, an "investment company" within the meaning of the
Investment Advisers Act of 1940, as amended.
(17) No filing with, or approval, authorization, consent, license,
registration, qualification, order or decree of, any court or governmental
authority or agency, domestic or foreign, is necessary or required for the
execution, delivery and performance by the Company of its obligations under the
Distribution Agreement, the Indenture and the Notes, except such filings,
approvals, authorizations, consents, licenses, registrations, qualifications,
orders or decrees as have been obtained under the 1933 Act and the 1939 Act and
as may be required under state securities or blue sky laws in connection with
the issuance and sale of the Notes and except for the filing of any Pricing
Supplement under the 1933 Act.
Nothing has come to my attention that would lead me to believe that:
(a) as of July 10, 2002, the Registration Statement contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
(b) as of the date hereof, either the Registration Statement or the Prospectus
contains an untrue statement of a material fact or omits to state a material
fact necessary to make the statements therein, with respect to the Prospectus in
the light of the circumstances under which they were made, not misleading. I
express no opinion or belief as to the financial statements, including the notes
and schedules thereto, or any other financial data set forth or referred to in
the Registration Statement or the Prospectus or omitted from the Registration
Statement or the Prospectus or as to the Form T-1.
In rendering my opinion, I may rely (i) as to matters of fact (but not
as to legal conclusions), to the extent I deem proper, on certificates of
responsible officers of the Company and public officials and (ii) as to the
enforceability under New York law of the Indenture and the Notes against the
Company, to the extent that I have deemed proper, on the advice of attorneys
retained by the Company.
D-3
EXHIBIT E
FORM OF ACCOUNTANT'S COMFORT LETTER
PURSUANT TO SECTION 5(d)
We are independent public accountants with respect to the Company and
its subsidiaries within the meaning of the 1933 Act and the 1933 Act Regulations
and:
(i) in our opinion, the audited consolidated financial
statements and the related financial statement schedules included or
incorporated by reference in the Registration Statement and the
Prospectus comply as to form in all material respects with the
applicable accounting requirements of the 1933 Act and the 1933 Act
Regulations;
(ii) on the basis of procedures (but not an examination in
accordance with generally accepted auditing standards) consisting of a
reading of the unaudited interim consolidated financial statements of
the Company for the [three- month periods ended _________, 19__ and
_________, 19__, the three- and six-month periods ended _________, 19__
and _________, 19__ and the three- and nine-month periods ended
_________, 19__ and _________, 19__, included or incorporated by
reference in the Registration Statement and the Prospectus
(collectively, the "10-Q Financials")] [, a reading of the unaudited
interim consolidated financial statements of the Company for the
_____-month periods ended _________, 19___ and _________, 19___,
included or incorporated by reference in the Registration Statement and
the Prospectus (the "_____-month financials")] [, a reading of the
latest available unaudited interim consolidated financial statements of
the Company], a reading of the minutes of all meetings of the
stockholders and directors of the Company and its subsidiaries and
committees thereof since [day after end of last audited period],
inquiries of certain officials of the Company and its subsidiaries
responsible for financial and accounting matters, a review of interim
financial information in accordance with standards established by the
American Institute of Certified Public Accountants in Statement on
Auditing Standards No. 71, Interim Financial Information ("SAS 71"),
with respect to the [description of relevant periods] and such other
E-1
inquiries and procedures as may be specified in such letter, nothing
came to our attention that caused us to believe that:
(A) the 10-Q Financials included or incorporated
by reference in the Registration Statement and the Prospectus
do not comply as to form in all material respects with the
applicable accounting requirements of the 1934 Act and the
1934 Act Regulations applicable to unaudited financial
statements included in Form 10-Q or any material modifications
should be made to the 10-Q Financials included or incorporated
by reference in the Registration Statement and the Prospectus
for them to be in conformity with generally accepted
accounting principles;
[(B) the _____-month financials included or
incorporated by reference in the Registration Statement and
the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the
1933 Act and the 1933 Act Regulations applicable to unaudited
interim financial statements included in registration
statements or any material modifications should be made to the
_____-month financials included in the Registration Statement
and the Prospectus for them to be in conformity with generally
accepted accounting principles;]
(C) at [_________, 19___ and at] a specified
date not more than five days prior to the date hereof, was
any change in the ___________ of the Company and its there
subsidiaries, any decrease in the __________ of the Company
and its subsidiaries or any increase in the __________ of the
Company and its subsidiaries, in each case as compared
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with amounts shown in the latest balance sheet included or
incorporated by reference in the Registration Statement and
the Prospectus, except in each case for any changes, decreases
or increases that the Registration Statement and the
Prospectus disclose have occurred or may occur; or
(D) for the period from [_________, 19__ to
_________, 19__ and for the period from] _________, 19__
to a specified date not more than five days prior to the date
hereof, there was any decrease in _________, __________ or
___________, in each case as compared with the comparable
period in the preceding year, except in each case for any
decreases that the Registration Statement and the Prospectus
discloses have occurred or may occur;
[(iii) based upon the procedures set forth in clause (ii)
above and a reading of the Selected Financial Data included or
incorporated by reference in the Registration Statement and the
Prospectus [and a reading of the financial statements from which such
data were derived], nothing came to our attention that caused us to
believe that the Selected Financial Data included or incorporated by
reference in the Registration Statement and the Prospectus do not
comply as to form in all material respects with the disclosure
requirements of Item 301 of Regulation S-K of the 1933 Act [, that the
amounts included in the Selected Financial Data are not in agreement
with the corresponding amounts in the audited consolidated financial
statements for the respective periods or that the financial statements
not included or incorporated by reference in the Registration Statement
and the Prospectus from which certain of such data were derived are not
in conformity with generally accepted accounting principles;]
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(iv) we have compared the information included or
incorporated by reference in the Registration Statement and the
Prospectus under selected captions with the disclosure requirements of
Regulation S-K of the 1933 Act and on the basis of limited procedures
specified herein, nothing came to our attention that caused us to
believe that such information does not comply as to form in all
material respects with the disclosure requirements of Items 302, 402
and 503(d), respectively, of Regulation S-K;
[(v) based upon the procedures set forth in clause (ii)
above, a reading of the latest available unaudited financial statements
of the Company that have not been included or incorporated by reference
in the Registration Statement and the Prospectus and a review of such
financial statements in accordance with SAS 71, nothing came to our
attention that caused us to believe that the unaudited amounts for
________ for the [most recent period] do not agree with the amounts set
forth in the unaudited consolidated financial statements for those
periods or that such unaudited amounts were not determined on a basis
substantially consistent with that of the corresponding amounts in the
audited consolidated financial statements;]
[(vi) we are unable to and do not express any opinion on
the [Pro Forma Combined Balance Sheet and Statement of Operations]
(collectively, the "Pro Forma Statements") included or incorporated by
reference in the Registration Statement and the Prospectus or on the
pro forma adjustments applied to the historical amounts included in the
Pro Forma Statements; however, for purposes of this letter we have:
(A) read the Pro Forma Statements;
(B) performed [an audit] [a review in accordance
with SAS 71] of the financial statements to which the pro
forma adjustments were applied;
(C) made inquiries of certain officials of the
Company who have responsibility for financial and accounting
matters about the basis for their determination of the pro
forma adjustments and whether the Pro Forma Statements comply
as to form in all material respects with the applicable
accounting requirements of Rule 11-02 of Regulation S-X; and
(D) proved the arithmetic accuracy of the
application of the pro forma adjustments to the historical
amounts in the Pro Forma Statements; and
E-4
on the basis of such procedures and such other inquiries and procedures
as specified herein, nothing came to our attention that caused us to
believe that the Pro Forma Statements included or incorporated by
reference in the Registration Statement and the Prospectus do not
comply as to form in all material respects with the applicable
requirements of Rule 11-02 of Regulation S-X or that the pro forma
adjustments have not been properly applied to the historical amounts in
the compilation of those statements;]
(vii) in addition to the procedures referred to in clause
(ii) above, we have performed other procedures, not constituting an
audit, with respect to certain amounts, percentages, numerical data
and financial information included or incorporated by reference in
the Registration Statement and the Prospectus, which are specified
herein, and have compared certain of such items with, and have
found such items to be in agreement with, the accounting and
financial records of the Company; and
[(viii) in addition, we [add comfort on a financial forecast
that is included or incorporated by reference in the Registration
Statement and the Prospectus].
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