Exhibit 1(d)
X.X. Xxxxxx Company
$________________
Medium-Term Notes, Series _________
Distribution Agreement
[Date]
[Names and Addresses of Agents]
Ladies and Gentlemen:
X.X. Xxxxxx Company, a Minnesota corporation (the "Company"), proposes to
issue and sell from time to time its Medium-Term Notes, Series __________ (the
"Securities") in an aggregate amount up to $__________________ and agrees with
each of you (individually, an "Agent", and collectively, the "Agents") as set
forth in this Agreement.
Subject to the terms and conditions stated herein and to the reservation by
the Company of the right to sell Securities directly on its own behalf or
indirectly through other agents, the Company hereby (i) appoints each Agent as
an agent of the Company for the purpose of soliciting and receiving offers to
purchase Securities from the Company pursuant to Section 2(a) hereof and (ii)
agrees that, except as otherwise contemplated herein, whenever it determines to
sell Securities directly to any Agent as principal, it will enter into a
separate agreement (each a "Terms Agreement"), substantially in the form of
Annex I hereto, relating to such sale in accordance with Section 2(b) hereof.
This Distribution Agreement shall not be construed to create either an
obligation on the part of the Company to sell any Securities or an obligation of
any of the Agents to purchase Securities as principal.
The Securities will be issued pursuant to the Indenture, dated as of
___________________, as amended or supplemented from time to time (the
"Indenture"), between the Company and ____________________________, as Trustee
(the "Trustee"). The Securities shall have the maturity ranges, interest rates
and other terms set forth in the Prospectus referred to below as it may be
amended or supplemented from time to time. The Securities will be issued, and
the terms thereof established, from time to time by the Company in accordance
with the Indenture.
1. The Company represents and warrants to, and agrees with, each Agent
that:
(a) A registration statement on Form S-3 (File No. __________) in
respect of the Securities has been filed with the Securities and Exchange
Commission (the
"Commission"); such registration statement and any post-effective amendment
thereto, each in the form heretofore delivered or to be delivered to such Agent,
excluding exhibits to such registration statement, but including all documents
incorporated by reference in the prospectus included in the registration
statement, have been declared effective by the Commission in such form; no other
document with respect to such registration statement or document incorporated by
reference therein has heretofore been filed or transmitted for filing with the
Commission (other than the prospectuses filed pursuant to Rule 424(b) of the
rules and regulations of the Commission under the Securities Act of 1933, as
amended (the "Act") in the form heretofore delivered to the Agents); and no stop
order suspending the effectiveness of the registration statement has been issued
and no proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in such registration statement
or filed with the Commission pursuant to Rule 424(a) of the rules and
regulations of the Commission under the Act, are hereinafter called a
"Preliminary Prospectus"; the various parts of such registration statement,
including all exhibits thereto and the documents incorporated by reference in
the prospectus contained in the registration statement at the time such part of
the registration statement became effective but excluding Form T-1, each as
amended at the time such part of the registration statement became effective, is
hereinafter collectively called the "Registration Statement"; the prospectus
(including, if applicable, any prospectus supplement) relating to the
Securities, in the form in which it has most recently been filed, or transmitted
for filing, with the Commission on or prior to the date of this Agreement, is
hereinafter called the "Prospectus"; any reference herein to any Preliminary
Prospectus or the Prospectus shall be deemed to refer to the documents
incorporated by reference therein pursuant to the applicable form under the Act;
any reference to any amendment or supplement to any Preliminary Prospectus or
the Prospectus, including any supplement to the Prospectus that sets forth only
the terms of a particular issue of the Securities (a "Pricing Supplement"),
shall be deemed to include, without limitation, any documents filed after the
date of such Preliminary Prospectus or Prospectus, as the case may be, under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
incorporated in such Preliminary Prospectus or Prospectus by reference; any
reference to any amendment to the Registration Statement shall be deemed to
refer to and include any annual report of the Company filed pursuant to Section
13(a) or 15(d) of the Exchange Act after the effective date of the Registration
Statement that is incorporated by reference in the Registration Statement; and
any reference to the Prospectus as amended or supplemented shall be deemed to
refer to and include the Prospectus as amended or supplemented (including by the
applicable Pricing Supplement filed in accordance with Section 4(a) hereof) in
relation to Securities to be sold pursuant to this Agreement, in the form filed
or transmitted for filing with the Commission pursuant to Rule 424(b) under the
Act and in accordance with Section 4(a) hereof, including any documents
incorporated by reference therein as of the date of such filing);
(b) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
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therein or necessary to make the statements therein not misleading and any
further documents so filed and incorporated by reference in the Prospectus, or
any further amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be, will conform in
all material respects to the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder 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; provided, however, that this representation and warranty shall
not apply to any statement or omission made in reliance upon and in conformity
with information furnished in writing to the Company by any Agent expressly for
use in the Prospectus as amended or supplemented to relate to a particular
issuance of Securities;
(c) The Registration Statement, as of the applicable effective date,
and the Prospectus as of the applicable filing date, conformed, and any further
amendments or supplements to the Registration Statement or the Prospectus, when
they become effective or are filed with the Commission, as the case may be, will
conform, in all material respects to the requirements of the Act and the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the rules and
regulations of the Commission thereunder, and did not and will not, as of the
applicable effective date of the Registration Statement and any amendment
thereto and as of the applicable filing date of the Prospectus or any amendment
or supplement thereto, 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; provided, however, that this representation
and warranty shall not apply to any statement or omission made in reliance upon
and in conformity with information furnished in writing to the Company by any
Agent expressly for use in the Prospectus as amended or supplemented to relate
to a particular issuance of Securities;
(d) Neither the Company nor any of its Significant Subsidiaries has
sustained since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any material loss or interference
with its business from fire, explosion, flood or other calamity, whether or not
covered by insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated in the Prospectus
(as used herein, "Significant Subsidiaries" shall mean _______________________);
and, since the respective dates as of which information is given in the
Registration Statement and in the Prospectus, there has not been any change in
the capital stock (other than issuances of common stock pursuant to stock option
and other compensatory plans and arrangements adopted by the Board of Directors
of the Company and repurchases by the Company under its publicly announced
common stock buy back program authorized by the Company's Board of Directors) or
any increases in the long-term debt of the Company or any of its Significant
Subsidiaries or any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general affairs,
management, financial position, shareholders' investment or results of
operations of the Company and its subsidiaries, otherwise than as set forth or
contemplated in the Prospectus;
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(e) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Minnesota, with
power and authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction where, in light of the nature of the
business transacted or the property owned by it, such qualification is necessary
and the failure so to qualify might permanently impair title to property
material to its operations or expose it to substantial liabilities in such
jurisdiction; and each Significant Subsidiary of the Company has been duly
incorporated and is validly existing as a corporation in good standing under the
laws of its jurisdiction of incorporation and has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction where, in light of the nature of the
business transacted or the property owned by it, such qualification is necessary
and the failure so to qualify might permanently impair title to property
material to its operations or expose it to substantial liabilities in such
jurisdiction;
(f) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued and are fully paid and
non-assessable; and all of the issued shares of capital stock of each
Significant Subsidiary of the Company have been duly and validly authorized and
issued, are fully paid and non-assessable, and (except for directors' qualifying
shares) are owned directly or indirectly by the Company, free and clear of all
liens, encumbrances, equities or claims;
(g) The establishment of the Medium-Term Note Program, Series ______,
of the Company has been duly authorized. When the terms of a particular issuance
of the Securities have been established in accordance with the Indenture, and
such Securities are issued and delivered pursuant to this Agreement and any
Terms Agreement, such Securities will have been duly authorized, executed,
authenticated, issued and delivered and will constitute valid and legally
binding obligations of the Company, enforceable in accordance with their terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting creditors' rights and to
general equity principles and will be entitled to the benefits provided by the
Indenture; the Indenture has been duly authorized, executed and delivered and
constitutes a valid and legally binding instrument, against the Company in
accordance with its terms, subject, as to enforcement, to bankruptcy,
insolvency, reorganization and other laws of general applicability relating to
or affecting creditors' rights and to general equity principles; and the
Indenture conforms and the Securities of any particular issuance of Securities
will conform to the descriptions thereof contained in the Prospectus as amended
or supplemented to relate to such issuance of Securities;
(h) The issue and sale of the Securities, the compliance by the
Company with all of the provisions of the Securities, the Indenture, this
Agreement and any Terms Agreement, and the consummation of the transactions
herein and therein contemplated will not result in a breach of any of the terms
or provisions of, or constitute a default under, or
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result in the creation or imposition of any lien, charge or encumbrance upon any
of the property or assets of the Company or any of its Significant Subsidiaries
pursuant to the terms of, any indenture, mortgage, deed of trust, loan agreement
or other material agreement or instrument 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, nor will such
action result in any violation of the provisions of the Restated Articles of
Incorporation or the By-Laws of the Company or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of its Significant Subsidiaries or any of their properties;
and no consent, approval, authorization, order, registration or qualification of
or with any court or governmental agency or body is required for the
solicitation of offers to purchase Securities, the issue and sale of the
Securities or the consummation by the Company of the other transactions
contemplated by this Agreement, any Terms Agreement or the Indenture, except
such as have been obtained, or will have been obtained prior to the Commencement
Date (as defined in Section 3 hereof), under the Act or the Trust Indenture Act
and such consents, approvals, authorizations, registrations or qualifications as
may be required under state securities or Blue Sky laws or NASD regulations in
connection with the solicitation by the Agents of offers to purchase the
Securities from the Company and with purchases of the Securities by the Agents
as principals, as the case may be, in each case in the manner contemplated
hereby;
(i) There are no legal or governmental proceedings pending to which
the Company or any of its subsidiaries is a party or to which any property of
the Company or any of its subsidiaries is the subject, other than as set forth
in the Prospectus and other than litigation or governmental proceedings which
individually and in the aggregate do not have a material adverse effect on the
financial position, shareholders' investment or results of operations of the
Company and its subsidiaries taken as a whole; and, to the best of the Company's
knowledge, no such proceedings are threatened or contemplated by governmental
authorities or threatened by others; and
(j) PricewaterhouseCoopers LLP, who have certified certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder.
2. (a) On the basis of the representations and warranties herein
contained and subject to the terms and conditions herein set forth, each of the
Agents hereby severally and not jointly agrees to use its reasonable efforts, as
agent of the Company, to solicit and receive offers to purchase the Securities
from the Company upon the terms and conditions set forth in the Prospectus as
amended or supplemented from time to time. The Company may from time to time
sell Securities otherwise than through an Agent and may engage another agent
with respect to a specific purchase, provided that the Agents are given notice
of such purchase promptly after it is consummated. The Company reserves the
right to add another agent as a party to this Agreement. The Company also
reserves the right to sell, and may solicit and accept offers to purchase,
Securities directly on its own behalf. In the case of any such sale not
resulting from a solicitation made by any Agent, no commission
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will be payable under this Agreement with respect to such sale. These provisions
shall not limit Section 4(f) hereof or any similar provision included in any
Terms Agreement.
Procedural details relating to the issue and delivery of Securities,
the solicitation of offers to purchase Securities and the payment in each case
therefor shall be as set forth in the Administrative Procedure attached hereto
as Annex II as it may be amended from time to time by written agreement between
the Agents and the Company (the "Administrative Procedure"). The provisions of
the Administrative Procedure shall apply to all transactions contemplated
hereunder other than those made pursuant to a Terms Agreement (unless such Terms
Agreement specifically provides that such provisions shall apply). Each Agent
and the Company agree to perform the respective duties and obligations
specifically provided to be performed by each of them in the Administrative
Procedure. The Company will furnish to the Trustee a copy of the Administrative
Procedure as from time to time in effect.
The Company reserves the right, in its sole discretion, to instruct
the Agents to suspend at any time, for any period of time or permanently, the
solicitation of offers to purchase the Securities. As soon as practicable, but
in any event not later than one business day in New York City, after receipt of
notice from the Company, the Agents will forthwith suspend solicitation of
offers to purchase Securities from the Company until such time as the Company
has advised the Agents that such solicitation may be resumed. During such
period, the Company shall not be required to comply with the provisions of
Sections 4(h), 4(i), 4(j) and 4(k). Upon advising the Agents that such
solicitation may be resumed, however, the Company shall, upon request of the
Agents (unless the Company has accepted an offer to purchase Securities, in
which case no such request shall be necessary), simultaneously provide the
documents required to be delivered by Sections 4(h), 4(i), 4(j) and 4(k), and
the Agents shall have no obligation to solicit offers to purchase the Securities
until such documents, if so requested, have been received by the Agents. In
addition, any failure by the Company to comply with its obligations hereunder,
including without limitation its obligation to deliver the documents required by
Sections 4(h), 4(i), 4(j) and 4(k), shall automatically terminate the Agents'
obligations hereunder to solicit offers to purchase the Securities hereunder as
agent.
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The Company agrees to pay to each Agent (or jointly to two or more of
the Agents if such solicitation is jointly made) a commission, at the time of
settlement of any sale of a Security by the Company as a result of a
solicitation made by such Agent, in an amount equal to the following percentage
of the principal amount of such Security sold:
Commission (percentage of
aggregate principal
Range of Maturities amount of Securities sold)
--------------------------------------- --------------------------
From 9 months to less than 1 year
From 1 year to less than 18 months
From 18 months to less than 2 years
From 2 years to less than 3 years
From 3 years to less than 4 years
From 4 years to less than 5 years
From 5 years to less than 6 years
From 6 years to less than 7 years
From 7 years to less than 10 years
From 10 years to less than 15 years
From 15 years to less than 20 years
From 20 years to less than 30 years
30 years and more
---------
*To be negotiated at the time of sale.
Each Agent shall communicate to the Company, orally or in writing,
each offer to purchase Securities other than those rejected by such Agent. The
Company shall have the sole right to accept offers to purchase Securities and
may reject any proposed purchase of Securities as a whole or in part. Each Agent
shall have the right, in its discretion reasonably exercised, to reject any
offer received by it to purchase Securities, as a whole or in part, and any such
rejection by such Agent shall not be deemed a breach of its agreements contained
herein.
(b) Each sale of Securities to any Agent as principal shall be made
in accordance with the terms of this Agreement and (unless the Company and such
Agent shall otherwise agree) a Terms Agreement which will provide for the sale
of such Securities to, and the purchase thereof by, such Agent. A Terms
Agreement may also specify certain provisions relating to the reoffering of such
Securities by such Agent. Any Agent's commitment to purchase Securities as
principal pursuant to any Terms Agreement or otherwise 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. Each Terms Agreement shall specify the principal amount of Securities to
be purchased by any Agent pursuant thereto, the price to be paid to the Company
for such Securities, any provisions relating to rights of, and default by,
underwriters acting together with such Agent in the reoffering of the
Securities, and the time, date and place of delivery of and payment for such
Securities. Such Terms Agreement shall also specify the procedural
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details relating to the issue and delivery of such Securities and any
requirements for officers' certificates, opinions of counsel and accountants'
letters pursuant to Section 4 hereof. Each Agent proposes to offer Securities
purchased by it as principal for sale at prevailing market prices or prices
related thereto at the time of sale, which may be equal to, greater than or less
than the price at which such Securities are purchased by such Agent from the
Company.
For each sale of Securities to an Agent as principal that is not made
pursuant to a Terms Agreement, the procedural details relating to the issue and
delivery of such Securities and payment therefor shall be as set forth in the
Administrative Procedure. For each such sale of Securities to an Agent as
principal that is not made pursuant to a Terms Agreement, the Company agrees to
pay such Agent a commission (or grant an equivalent discount) as provided in
Section 2(a) hereof and in accordance with the schedule set forth therein.
Each time and date of delivery of and payment for Securities to be
purchased by any Agent as principal, whether set forth in a Terms Agreement or
in accordance with the Administrative Procedure, is referred to herein as a
"Time of Delivery".
(c) Each Agent agrees, with respect to any Security denominated in a
currency other than U.S. dollars, as agent, directly or indirectly, not to
solicit offers to purchase, and as principal under any Terms Agreement or
otherwise, directly or indirectly, not to offer, sell or deliver, such Security
in, or to residents of, the country issuing such currency, except as permitted
by applicable law.
3. The documents required to be delivered pursuant to Section 6 hereof on
the Commencement Date (as defined below) shall be delivered to the Agents at the
offices of ____________________________________________ at 11:00 a.m., New York
City time, on __________________________, ____ (the "Commencement Date").
4. The Company covenants and agrees with each Agent:
(a) (i) To make no amendment or supplement to the Registration
Statement or the Prospectus after the date of any Terms Agreement or other
agreement by an Agent to purchase Securities as principal and prior to the
related Time of Delivery which shall be disapproved by any Agent party to
such Terms Agreement or so purchasing as principal promptly after
reasonable notice thereof unless in the opinion of counsel to the Company
such amendment or supplement is required by law, provided, however, that
the Company shall only be required to provide the Company's periodic
filings to be filed with the Commission pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act to [Agents' Counsel], counsel to the
Agents, on behalf of the Agents, on the business day prior to the date on
which such filings are to be transmitted for filing with the Commission and
no consent on the part of the Agents shall be required;
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(ii) to prepare, with respect to any Securities to be sold
through or to such Agent pursuant to this Agreement, a Pricing Supplement
with respect to such Securities in a form previously approved by such Agent
and to file such Pricing Supplement pursuant to the applicable subparagraph
of Rule 424(b) under the Act not later than the time period specified
therein;
(iii) to make no amendment or supplement at any time to the
Registration Statement or Prospectus, other than any Pricing Supplement,
prior to having afforded each Agent a reasonable opportunity to review and
comment thereon, provided, however, that the foregoing requirement shall
not apply to any of the Company's periodic filings with the Commission
required to be filed pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act, except that the Company will give the Agents two days' notice
that such filings are to be made with the Commission and will cause copies
of such filings to be delivered to the Agents promptly after being
transmitted for filing with the Commission; provided, further, however,
that to the extent any Agent shall disapprove of any of the Company's
periodic filings with the Commission required to be so filed pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, such Agent shall
have the right, in its sole discretion, to suspend solicitation of offers
to purchase Securities from the Company until such time as the Company
amends such filing or takes such other action as is satisfactory to such
Agent with respect to such filing;
(iv) to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange
Act for so long as the delivery of a prospectus is required in connection
with the offering or sale of the Securities, and during such same period to
advise such Agent, promptly after the Company receives notice thereof, of
the time when any amendment to the Registration Statement has been filed or
has become effective or any supplement to the Prospectus or any amended
Prospectus (other than any Pricing Supplement that relates to Securities
not purchased through or by such Agent and other than documents
incorporated by reference in the Prospectus) has been filed with the
Commission, of the issuance by the Commission of any stop order or of any
order preventing or suspending the use of any prospectus relating to the
Securities, of the suspension of the qualification of the Securities for
offering or sale in any jurisdiction, of the initiation or threatening of
any proceeding for any such purpose, or of any request by the Commission
for the amendment or supplement of the Registration Statement or Prospectus
or for additional information; and
(v) in the event of the issuance of any such stop order or of
any such order preventing or suspending the use of any such prospectus or
suspending any such qualification, to use promptly its best efforts to
obtain its withdrawal;
(b) Promptly from time to time to take such action as such Agent may
reasonably request to qualify the Securities for offering and sale under the
securities laws of
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such jurisdictions as such Agent may request and to comply with such laws so as
to permit the continuance of sales and dealings therein for as long as may be
necessary to complete the distribution or sale of the Securities; provided,
however, that in connection therewith the Company shall not be required to
qualify as a foreign corporation or to file a general consent to service of
process in any jurisdiction;
(c) To furnish such Agent with copies of the Registration Statement
and each amendment thereto, with copies of the Prospectus as each time amended
or supplemented, other than any Pricing Supplement (except as provided in the
Administrative Procedure), in the form in which it is filed with the Commission
pursuant to Rule 424 under the Act, both in such quantities as such Agent may
reasonably request from time to time; and, if the delivery of a prospectus is
required at any time in connection with the offering or sale of the Securities
(including Securities purchased from the Company by such Agent as principal) and
if at such time any event shall have occurred as a result of which the
Prospectus as then amended or supplemented would include an untrue statement of
a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made when such Prospectus is delivered, not misleading, or, if for any other
reason it shall be necessary during such same period to amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated by
reference in the Prospectus in order to comply with the Act, the Exchange Act or
the Trust Indenture Act, to notify such Agent and request such Agent, in its
capacity as agent of the Company, to suspend solicitation of offers to purchase
Securities from the Company (and, if so notified, such Agent shall cease such
solicitations as soon as practicable, but in any event not later than one
business day later); and if the Company shall decide to amend or supplement the
Registration Statement or the Prospectus as then amended or supplemented, to so
advise such Agent promptly by telephone (with confirmation in writing) and to
prepare and cause to be filed promptly with the Commission an amendment or
supplement to the Registration Statement or such Prospectus that will correct
such statement or omission or effect such compliance; provided, however, that if
during such same period such Agent continues to own Securities purchased from
the Company by such Agent as principal or such Agent is otherwise required to
deliver a prospectus in respect of transactions in the Securities, the Company
shall promptly prepare and file with the Commission such an amendment or
supplement;
(d) To make generally available to its security holders as soon as
practicable, but in any event not later than eighteen months after the effective
date of the Registration Statement (as defined in Rule 158 under the Act), an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act (including, at the option of
the Company, Rule 158);
(e) During the period when this Agreement is in effect, to furnish to
such Agent copies of all reports or other communications (financial or other)
furnished to shareholders, and deliver to such Agent as soon as they are
available, copies of any reports and financial statements furnished to or filed
with the Commission or any national securities exchange on which any class of
securities of the Company is listed, and, after termination of
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this Agreement but during such time as any Securities are outstanding, furnish
to any Agent such reports, other communications and financial statements upon
the request of such Agent;
(f) That, from the date of any Terms Agreement with such Agent or
other agreement by such Agent to purchase Securities as principal and continuing
to and including the related Time of Delivery, not to offer, sell, contract to
sell or otherwise dispose of any debt securities of the Company which both
mature more than nine months after such Time of Delivery and are substantially
similar to the Securities, without the prior written consent of such Agent;
(g) That each acceptance by the Company of an offer to purchase
Securities hereunder (including any purchase by such Agent as principal not
pursuant to a Terms Agreement), and each execution and delivery by the Company
of a Terms Agreement with such Agent, shall be deemed to be an affirmation to
such Agent that the representations and warranties of the Company contained in
or made pursuant to this Agreement are true and correct as of the date of such
acceptance or of such Terms Agreement, as the case may be, as though made at and
as of such date, and an undertaking that such representations and warranties
will be true and correct as of the settlement date for the Securities relating
to such acceptance or as of the Time of Delivery relating to such sale, as the
case may be, as though made at and as of such date (except that such
representations and warranties shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented relating to such
Securities);
(h) That, if so requested by such Agent, each time the Registration
Statement or the Prospectus shall be amended or supplemented (other than by a
Pricing Supplement to the Prospectus or any other amendment or supplement
relating solely to a change in the terms of the Securities), including, without
limitation, each time a document filed under the Act or the Exchange Act is
incorporated by reference into the Prospectus, and each time the Company sells
Securities to such Agent as principal pursuant to a Terms Agreement and such
Terms Agreement specifies that [Agents' Counsel], counsel to the Agents, is
required to deliver an opinion or opinions as a condition to the purchase of
Securities pursuant to such Terms Agreement, the Company shall furnish to such
counsel, reasonably in advance of the date on which such opinion is required,
such papers and information as they may reasonably request to enable them to
furnish to such Agent the opinion or opinions referred to in Section 6(b)
hereof;
(i) That, if so requested by such Agent, each time the Registration
Statement or the Prospectus shall be amended or supplemented (other than by a
Pricing Supplement to the Prospectus or any other amendment or supplement
relating solely to a change in the terms of the Securities), including, without
limitation, each time a document filed under the Act or the Exchange Act is
incorporated by reference into the Prospectus, and each time the Company sells
Securities to such Agent as principal pursuant to a Terms Agreement and such
Terms Agreement specifies that the delivery of an opinion under this Section
4(i) as a condition to the purchase of Securities pursuant to such Terms
Agreement, the Company shall furnish or cause to be furnished forthwith to such
Agent written opinions
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of the Company's General Counsel and _________________________, or other counsel
satisfactory to such Agent in its reasonable judgment, dated the date of such
amendment, supplement, incorporation or Time of Delivery relating to such sale,
as the case may be, in form satisfactory to such Agent in its reasonable
judgment to the effect that such Agent may rely on the opinions referred to in
Sections 6(c) and 6(d) hereof which were last furnished to such Agent to the
same extent as though they were dated the date of such letter authorizing
reliance (except that statements in such last opinions shall be deemed to relate
to the Registration Statement and the Prospectus as amended and supplemented to
such date) or, in lieu of such opinions, opinions of the same tenor as the
opinions referred to in Sections 6(c) and 6(d) hereof but modified to relate to
the Registration Statement and the Prospectus as amended and supplemented to
such date;
(j) That, if so requested by such Agent, each time the Registration
Statement or the Prospectus shall be amended or supplemented, including, without
limitation, each time that a document filed under the Act or the Exchange Act is
incorporated by reference into the Prospectus, in any case to set forth
financial information included in or derived from the Company's consolidated
financial statements or accounting records, and, each time the Company sells
Securities to such Agent as principal pursuant to a Terms Agreement and such
Terms Agreement specifies the delivery of a letter under this Section 4(j) as a
condition to the purchase of Securities pursuant to such Terms Agreement, the
Company shall cause the independent certified public accountants who have
certified the financial statements of the Company and its subsidiaries included
or incorporated by reference in the Registration Statement forthwith to furnish
such Agent a letter, dated the date of such amendment, supplement, incorporation
or Time of Delivery relating to such sale, as the case may be, in form
satisfactory to such Agent in its reasonable judgment, of the same tenor as the
letter referred to in Section 6(e) hereof but modified to relate to the
Registration Statement and the Prospectus as amended or 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 five 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 6(e) hereof which was last furnished to such Agent; and
(k) That, if so requested by such Agent, each time the Registration
Statement or the Prospectus shall be amended or supplemented (other than by a
Pricing Supplement to the Prospectus as amended or supplemented or any other
amendment or supplement relating solely to a change in the terms of the
Securities), including, without limitation, each time a document filed under the
Act or the Exchange Act is incorporated by reference into the Prospectus, and
each time the Company sells Securities to such Agent as principal pursuant to a
Terms Agreement and such Terms Agreement specifies the delivery of a certificate
under this Section 4(k) as a condition to the purchase of Securities pursuant to
such Terms Agreement, the Company shall furnish or cause to be furnished
forthwith to such
12
Agent a certificate executed by officers of the Company satisfactory to such
Agent, dated the date of such supplement, amendment, incorporation or Time of
Delivery related to such sale, as the case may be, in such form as shall be
satisfactory to such Agent in its reasonable judgment, to the effect that the
statements contained in the certificates referred to in Section 6(j) hereof
which were last furnished to such Agent are true and correct at such date, as
though made at and as of such date (except that such statements shall be deemed
to relate to the Registration Statement and the Prospectus as amended and
supplemented to such date) or, in lieu of such certificate, certificates of the
same tenor as the certificates referred to in said Section 6(j) but modified to
relate to the Registration Statement and the Prospectus as amended and
supplemented to such date.
5. The Company covenants and agrees with each Agent that the Company will
pay or cause to be paid the following: (i) the fees and expenses of the
Company's counsel and accountants in connection with the registration of the
Securities under the Act and all other expenses in connection with the
preparation, printing and filing of the Registration Statement, any Preliminary
Prospectus, the Prospectus and any Pricing Supplement and all other amendments
and supplements thereto and the mailing and delivering of copies thereof to such
Agent; (ii) the fees and expenses of counsel for the Agents in connection with
the establishment of the program contemplated hereby; (iii) the cost of printing
or reproducing this Agreement, any Terms Agreement, the Indenture, any Blue Sky
and Legal Investment Memoranda, initial closing documents (including any
compilations thereof) and any other documents in connection with the offering,
purchase, sale and delivery of the Securities; (iv) all expenses in connection
with the qualification of the Securities for offering and sale under state
securities laws as provided in Section 4(b) hereof, including the fees and
disbursements of counsel for the Agents in connection with such qualification
and in connection with the Blue Sky and legal investment surveys; (v) any fees
charged by securities rating services for rating the Securities; (vi) the cost
of preparing the Securities; (vii) the fees and expenses of any Trustee and any
agent of any Trustee and the fees and disbursements of counsel for any Trustee
in connection with the Indenture and the Securities; (viii) any advertising
expenses connected with the solicitation of offers to purchase and the sale of
Securities so long as such advertising expenses have been approved by the
Company; and (ix) all other costs and expenses incident to the performance of
its obligations hereunder which are not otherwise specifically provided for in
this Section. Except as provided in Sections 7 and 8 hereof, each Agent shall
pay all other expenses it incurs.
6. The obligation of any Agent, as agent of the Company, to solicit
offers to purchase the Securities at any time (the "Solicitation Time"), and the
obligation of any Agent to purchase Securities as principal, pursuant to any
Terms Agreement or otherwise, shall in each case be subject, in such Agent's
reasonable discretion, to the condition that all representations and warranties
and other statements of the Company herein (and, in the case of an obligation of
any Agent under a Terms Agreement, in or incorporated by reference in such Terms
Agreement) are true and correct at and as of the Commencement Date and, if and
to the extent requested by such Agent, at and as of any applicable date referred
to in Section 4(k) hereof, the condition that the Company shall have performed
all of its
13
obligations hereunder theretofore in each case to be performed and the following
additional conditions:
(a) (i) With respect to any Securities sold pursuant to this
Agreement, any Terms Agreement or otherwise, the Prospectus as amended or
supplemented (including the Pricing Supplement) with respect to such Securities
shall have been filed with the Commission pursuant to Rule 424(b) under the Act
within the applicable time period prescribed for such filing by the rules and
regulations under the Act and in accordance with Section 4(a) hereof; (ii) no
stop order suspending the effectiveness of the Registration Statement shall have
been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and (iii) all requests for additional information
on the part of the Commission shall have been complied with to the reasonable
satisfaction of such Agent;
(b) [Agents' Counsel], counsel to the Agents, shall have furnished to
such Agent (i) such opinion or opinions, dated the Commencement Date, with
respect to the matters covered in the first clause of paragraph (i) and
paragraphs (iv), (v), (vii) and (x) of subsection (d) below, as well as such
other related matters as such Agent may reasonably request, and (ii) if and to
the extent requested by such Agent, on each applicable date referred to in
Section 4(h), an opinion or opinions, dated such applicable date, to the effect
that such Agent may rely on the opinion or opinions which were last furnished to
such Agent pursuant to this Section 6(b) to the same extent as though it or they
were dated the date of such letter authorizing reliance (except that the
statements in such last opinion or opinions shall be deemed to relate to the
Registration Statement and the Prospectus as amended and supplemented to such
date) or, in any case, in lieu of such an opinion or opinions, an opinion or
opinions of the same tenor as the opinion or opinions referred to in clause (i)
but modified to relate to the Registration Statement and the Prospectus as
amended and supplemented to such date; and in each case such counsel shall have
received such papers and information as they may reasonably request to enable
them to pass upon such matters;
(c) Xxxxxxx X. Xxxxx, Esq., Corporate Secretary, Vice President and
General Counsel of the Company, or another of the Company's lawyers satisfactory
to the Agents, shall have furnished to such Agent his or her written opinion,
dated the Commencement Date and, if and to the extent requested by such Agent,
any applicable date referred to in Section 4(i), as the case may be, in form and
substance satisfactory to such Agent, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Minnesota, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus;
(ii) The Company has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the laws of
each other jurisdiction where, in light of the nature of the business
transacted or the property
14
owned by it, such qualification is necessary and the failure so to qualify
might in such counsel's opinion permanently impair title to property
material to its operations or expose it to substantial liabilities in such
jurisdiction (such counsel being entitled to rely in respect of the opinion
in this clause upon opinions of local counsel and in respect of matters of
fact upon certificates of officers of the Company, provided that such
counsel shall state that such counsel believes that both such Agent and
such counsel are justified in relying upon such opinions and certificates);
(iii) Each Significant Subsidiary of the Company has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of its jurisdiction of incorporation, and has been duly
qualified as a foreign corporation for the transaction of business and is
in good standing under the laws of each other jurisdiction where, in light
of the nature of the business transacted or the property owned by it, such
qualification is necessary and the failure so to qualify might in such
counsel's opinion permanently impair title to property material to its
operations or expose it to substantial liabilities in such jurisdiction
(such counsel being entitled to rely in respect of the opinion in this
clause upon opinions of local counsel and in respect of matters of fact
upon certificates of officers of the Company, provided that such counsel
shall state that such counsel believes that both such Agent and such
counsel are justified in relying upon such opinions and certificates);
(iv) All of the issued shares of capital stock of each
Significant Subsidiary of the Company have been duly and validly authorized
and issued and are fully paid and non-assessable; and all of the
outstanding shares of capital stock of each such Significant Subsidiary
(except for directors' qualifying shares) are owned directly or indirectly
by the Company, free and clear of all liens, encumbrances, equities or
claims (such counsel being entitled to rely in respect of the opinion in
this clause upon opinions of local counsel and in respect of matters of
fact upon certificates of officers of the Company or its Significant
Subsidiaries, provided that such counsel shall state that such counsel
believes that both such Agent and such counsel are justified in relying
upon such opinions and certificates);
(v) To the best of such counsel's knowledge there are no legal
or governmental proceedings pending to which the Company or any of its
subsidiaries is a party or of which any property of the Company or any of
its subsidiaries is the subject, other than as set forth in the Prospectus
and other than litigation or governmental proceedings which individually
and in the aggregate are not material to the Company and its subsidiaries
taken as a whole; and to the best of such counsel's knowledge no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others;
(vi) The issue and sale of the Securities and the compliance by
the Company with all of the provisions of the Securities, the Indenture,
this Agreement, any applicable Terms Agreement, the Interest Calculation
Agency Agreement, dated as of ____________________, ____ (the "Interest
Calculation Agency Agreement"),
15
between the Company and ______________________________________, as
Calculation Agent, and the Letter of Representations, dated as of
____________________, ____ (the "Letter of Representations"), among the
Company, the Trustee and The Depository Trust Company and the consummation
of the transactions herein and therein contemplated will not result in a
breach of any of the terms or provisions of, or constitute a default under,
or result in the creation or imposition of any lien, charge or encumbrance
upon any of the property or assets of the Company or any of its Significant
Subsidiaries pursuant to the terms of, any indenture, mortgage, deed of
trust, loan agreement or other material agreement or instrument known to
such counsel 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; and
(vii) The documents incorporated by reference in the Prospectus
(other than the financial statements and related schedules therein, as to
which such counsel need express no opinion), when they became effective or
were filed with the Commission, as the case may be, complied as to form in
all material respects with the requirements of the Act or the Exchange Act
and the rules and regulations of the Commission thereunder; and such
counsel has no reason to believe that any of such documents, when they
became effective or were so filed, 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, in the light of the
circumstances under which they were made when such documents were so filed,
not misleading; and such counsel does not know of any contracts or other
documents of a character required to be filed as an exhibit to the
Registration Statement or required to be incorporated by reference into the
Prospectus or required to be described in the Registration Statement or the
Prospectus which are not filed or incorporated by reference or described as
required.
(d) ______________________________, counsel for the Company, shall
have furnished to such Agent their written opinion, dated the Commencement Date
and, if and to the extent requested by an Agent, any applicable date referred to
in Section 4(i), as the case may be, in form and substance satisfactory to such
Agent, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Minnesota, with corporate power and authority to own its properties and
conduct its business as described in the Prospectus;
(ii) The Company has an authorized capitalization as set forth
in the Prospectus;
(iii) To the best of such counsel's knowledge there are no legal
or governmental proceedings pending to which the Company or any of its
subsidiaries is
16
a party or to which any property of the Company or any of its subsidiaries
is the subject, other than as set forth in the Prospectus and other than
litigation or governmental proceedings which individually and in the
aggregate are not material to the Company and its subsidiaries; and to the
best of such counsel's knowledge no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(iv) Each of this Agreement (and any applicable Terms
Agreement), the Interest Calculation Agency Agreement and the Letter of
Representations has been duly authorized, executed and delivered by the
Company;
(v) The Medium-Term Note Program, Series ________, of the
Company has been duly authorized by the Company. When the terms of a
particular issuance of the Securities have been established in accordance
with the Indenture and such Securities are issued and delivered by the
Company in accordance with the terms of this Agreement and any Terms
Agreement, such Securities will have been duly authorized, executed,
authenticated, issued and delivered by the Company and will constitute
valid and legally binding obligations of the Company entitled to the
benefits provided by the Indenture, subject as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to general
equity principles; and the Indenture conforms and the Securities will
conform to the descriptions thereof in the Prospectus as amended or
supplemented;
(vi) Each of the Indenture, the Interest Calculation Agency
Agreement and the Letter of Representations has been duly authorized,
executed and delivered by the Company, and constitutes a valid and legally
binding instrument, enforceable against the Company in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency,
reorganization and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles; and the
Indenture has been duly qualified under the Trust Indenture Act;
(vii) The issue and sale of the Securities, the compliance by the
Company with all of the provisions of the Securities, the Indenture, this
Agreement and any applicable Terms Agreement, the Interest Calculation
Agency Agreement and the Letter of Representations and the consummation of
the transactions herein and therein contemplated will not result in a
breach of any of the terms or provisions of, or constitute a default under,
or result in the creation or imposition of any lien, charge or encumbrance
upon any of the property or assets of the Company or any of its
subsidiaries pursuant to the terms of, any document filed or incorporated
by reference by the Company as an exhibit to its most recent Annual Report
on Form 10-K or any subsequent Quarterly Report on Form 10-Q or Current
Report on Form 8-K or any other material contract known to such counsel,
nor will such action result in any violation of the provisions of the
Restated Articles of Incorporation or the By-Laws of the Company or any
statute or any order, rule or regulation applicable to the Company
17
and known to such counsel of any court or governmental agency or body
having jurisdiction over the Company or any of its subsidiaries or any of
their properties;
(viii) No consent, approval, authorization, order, registration
or qualification of or with any court or governmental agency or body is
required for the issue and sale of the Securities or the consummation by
the Company of the other transactions contemplated by this Agreement, any
applicable Terms Agreement, the Indenture, the Interest Calculation Agency
Agreement or the Letter of Representations, except such as have been
obtained under the Act and the Trust Indenture Act and such consents,
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws or NASD regulations in
connection with the solicitation by the Agents of offers to purchase
Securities from the Company and with purchases of Securities by an Agent as
principal, as the case may be, in each case as contemplated by this
Agreement;
(ix) The statements set forth in the Prospectus under the
caption "United States Federal Taxation" insofar as they purport to
describe the provisions of the laws referred to therein, are accurate and
fairly present the information called for with respect to such matters of
law; and
(x) The Registration Statement and the Prospectus (other than
the financial statements therein and documents incorporated by reference
therein, as to which such counsel need express no opinion) comply as to
form in all material respects with the requirements of the Act and the
Trust Indenture Act and the rules and regulations thereunder; although such
counsel does not assume any responsibility for the accuracy, completeness
or fairness of the statements contained in the Registration Statement or
the Prospectus (except as otherwise provided in subsection (ix) of this
Section 6(d)), such counsel has no reason to believe that the Registration
Statement contained, as of its effective date, or that the Prospectus as
amended or supplemented contained as of the date of such amendment or
supplement, or that either the Registration Statement or the Prospectus
contains as of the date of such opinion, an untrue statement of material
fact or that the Registration Statement omitted as of such effective date,
or that the Prospectus omits as of the date of such opinion, to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading (in each case, other than the financial
statements therein, as to which such counsel need express no opinion).
(e) Not later than 10:00 a.m., New York City time, on the
Commencement Date, and, if and to the extent requested by an Agent, on each
applicable date referred to in Section 4(j), the independent accountants who
have certified the financial statements of the Company and its subsidiaries
included or incorporated by reference in the Registration Statement shall have
furnished to such Agent a letter, dated the Closing Date, containing statements
and information of the type customarily included in accountants "comfort
letters" to underwriters with respect to financial statements contained and
incorporated by reference in the Prospectus.
18
(f) (i) Neither the Company nor any of its Significant Subsidiaries
shall have sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus prior to the
Solicitation Time or the date of the Pricing Supplement relating to the
Securities to be delivered at the relevant Time of Delivery, as the case may be,
any loss or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, other than as set forth or
contemplated in the Prospectus prior to the Solicitation Time or the date of the
Pricing Supplement relating to the Securities to be delivered at the relevant
Time of Delivery, as the case may be; and (ii) since the respective dates as of
which information is given in the Prospectus prior to the Solicitation Time or
the date of the Pricing Supplement relating to the Securities to be delivered at
the relevant Time of Delivery, as the case may be, there shall not have been any
change in the capital stock (other than issuances of common stock pursuant to
stock option and other compensatory plans and arrangements adopted by the Board
of Directors of the Company and repurchases by the Company under its publicly
announced common stock buy back program authorized by the Company's Board of
Directors) or any increase in the long-term debt of the Company or any of its
Significant Subsidiaries or any change, or any development involving a
prospective change, in or affecting the general affairs, management, financial
position, shareholders' investment or results of operations of the Company and
its subsidiaries taken as a whole, otherwise than as set forth or contemplated
in the Prospectus prior to the Solicitation Time or the date of the Pricing
Supplement relating to the Securities to be delivered at the relevant Time of
Delivery, as the case may be, the effect of which, in any such case described in
clause (i) or (ii), is in the judgment of such Agent so material and adverse as
to make it impracticable or inadvisable to proceed with the solicitation of
offers to purchase Securities or the purchase by such Agent of Securities from
the Company as principal pursuant to the applicable Terms Agreement or
otherwise, as the case may be, on the terms and in the manner contemplated in
the Prospectus prior to the Solicitation Time or the date of the Pricing
Supplement relating to the Securities to be delivered at the relevant Time of
Delivery, as the case may be.
(g) During the period in which the Agents are soliciting offers to
purchase Securities or during the period between the date of any Terms Agreement
and the related Time of Delivery, as applicable, (i) no downgrading shall have
occurred in the rating accorded the Company's debt securities by any "nationally
recognized statistical rating organization", as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the Company's
debt securities, the effect of which, in any such case described in clause (i)
or (ii), in the judgment of such Agent makes it impracticable or inadvisable to
proceed with the solicitation of offers to purchase Securities or the purchase
by such Agent of Securities from the Company as principal pursuant to the
applicable Terms Agreement or otherwise, as the case may be, on the terms and in
the manner contemplated in the Prospectus as amended or supplemented.
19
(h) During the period in which the Agents are soliciting offers to
purchase Securities or during the period between the date of any Terms Agreement
and the related Time of Delivery, there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally on the Nasdaq National Market; (ii) a suspension or material
limitation in trading in any securities issued by the Company; (iii) a general
moratorium on commercial banking activities in New York declared by either
Federal or New York State authorities; or (iv) an outbreak or escalation of
hostilities involving the United States or the declaration by the United States
of a national emergency or war, if the effect of any such event specified in
this clause (iv) in the judgment of such Agent makes it impracticable or
inadvisable to proceed with the solicitation of offers to purchase Securities or
the purchase by such Agent of Securities from the Company as principal pursuant
to the applicable Terms Agreement or otherwise, as the case may be, on the terms
and in the manner contemplated in the Prospectus as amended or supplemented.
(i) During the period in which the Agents are soliciting offers to
purchase Securities or during the period between the date of any Terms Agreement
and the related Time of Delivery, with respect to any Security denominated in a
currency other than the U.S. dollar, more than one currency or a composite
currency or any Security the principal or interest of which is indexed to such
currency, currencies or composite currency, there shall not have occurred a
suspension or limitation in foreign exchange trading in such currency,
currencies or composite currency by a major international bank, a general
moratorium on commercial banking activities in the country or countries issuing
such currency, currencies or composite currency, the outbreak or escalation of
hostilities involving, the occurrence of any change in the existing financial,
political or economic conditions of, or the declaration of war or a national
emergency by, the country or countries issuing such currency, currencies or
composite currency or the imposition or proposal of exchange controls by any
governmental authority in the country or countries issuing such currency,
currencies or composite currency, the effect of which, in any such case
described in this Section 6(i), in the judgment of such Agent makes it
impracticable or inadvisable to proceed with the solicitation by such Agent of
offers to purchase Securities or the purchase by such Agent of Securities from
the Company as principal pursuant to the applicable Terms Agreement or
otherwise, as the case may be, on the terms and in the manner contemplated in
the Prospectus as amended or supplemented.
(j) The Company shall have furnished or caused to be furnished to
such Agent certificates of officers of the Company dated the Commencement Date
and, if and to the extent requested by such Agent, any applicable date referred
to in Section 4(k) hereof that is on or prior to such Solicitation Time or Time
of Delivery, as the case may be, in such form and executed by such officers of
the Company as shall be satisfactory to such Agent, as to the accuracy of the
representations and warranties of the Company herein at and as of the
Commencement Date or such applicable date, as the case may be, as to the
performance by the Company of all of its obligations hereunder to be performed
at or prior to the Commencement Date or such applicable date, as the case may
be, as to the matters set forth in subsections (a), (f) and (g) of this Section
6, and as to such other matters as such Agent may reasonably request.
20
7. (a) The Company will indemnify and hold harmless each Agent against
any losses, claims, damages or liabilities, joint or several, to which such
Agent may become subject, under the Act or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon an untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, the Registration Statement, the
Prospectus, the Prospectus as amended or supplemented, or any other prospectus
relating to the Securities or any amendment or supplement thereto, or arise out
of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse such Agent for any legal or other
expenses reasonably incurred by such Agent in connection with investigating or
defending any such action or claim as such expenses are incurred; provided,
however, that the Company shall not be liable in any such case to the extent
that any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in any Preliminary Prospectus, the Registration Statement, the Prospectus,
the Prospectus as amended or supplemented or any other prospectus relating to
the Securities, or any such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Company by such Agent
expressly for use therein. With respect to any untrue statement or alleged
untrue statement in or omission or alleged omission from the Prospectus, the
indemnity agreement contained in this subsection (a) shall not inure to the
benefit of any Agent (or any person controlling such Agent) from or through whom
the person asserting any such losses, claims, damages or liabilities purchased
the Securities concerned, to the extent that the Prospectus relating to such
Securities was required to be delivered by such Agent under the Act in
connection with such purchase and was not so delivered at or prior to the
written confirmation of the sale of such Securities to such person and the
untrue statement or omission of a material fact contained in the Prospectus was
corrected in an amendment or supplement if the Company had previously furnished
copies of the Prospectus as so amended or supplemented (exclusive of material
incorporated by reference) to such Agent. This indemnity agreement will be in
addition to any liability which the Company may otherwise have.
(b) Each Agent will indemnify and hold harmless the Company against
any losses, claims, damages or liabilities to which the Company may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, the Registration Statement, the Prospectus, the
Prospectus as amended or supplemented or any other prospectus relating to the
Securities, or any amendment or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading,
in each case to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, the Registration Statement, the Prospectus, the
Prospectus as amended or supplemented or any other prospectus relating to the
Securities, or any such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Company by such Agent
expressly for use therein;
21
and will reimburse the Company for any legal or other expenses reasonably
incurred by the Company in connection with investigating or defending any such
action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection
(a) or (b) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. 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 satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection 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. An indemnifying party shall not be
liable for any settlement of any proceeding effected without its prior written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the indemnified party
from and against any losses, claims, damages or liabilities by reason of such
settlement or judgment. No indemnifying party shall, without the written consent
of the indemnified party, effect the settlement or compromise of, or consent to
the entry of any judgment with respect to, any pending or threatened action or
claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party
to such action or claim) unless such settlement, compromise or judgment (i)
includes an unconditional release of the indemnified party from all liability
arising out of such action 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) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof), in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and each Agent on the
other from the offering of the Securities to which such loss, claim, damage or
liability (or action in respect thereof) relates. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law or if the indemnified party failed to give the notice required under
subsection (c) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only
22
such relative benefits but also the relative fault of the Company on the one
hand and each Agent on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable considerations. The
relative benefits received by the Company on the one hand and each Agent on the
other shall be deemed to be in the same proportion as the total net proceeds
from the sale of Securities (before deducting expenses) received by the Company
bear to the total commissions or discounts received by such Agent in respect
thereof. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact required to be stated
therein or necessary in order to make the statements therein not misleading
relates to information supplied by the Company on the one hand or by any Agent
on the other and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Company
and each Agent agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by pro rata allocation (even if
all Agents were treated as one entity for such purpose) or by any other method
of allocation which does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities (or
actions in respect thereof) referred to above in this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this subsection (d), an Agent shall
not be required to contribute any amount in excess of the amount by which the
total public offering price at which the Securities purchased by or through it
were sold exceeds the amount of any damages which such Agent has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
obligations of each of the Agents under this subsection (d) to contribute are
several in proportion to the respective purchases made by or through it to which
such loss, claim, damage or liability (or action in respect thereof) relates and
are not joint.
(e) The obligations of the Company under this Section 7 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Agent within the meaning of the Act; and the obligations of each Agent under
this Section 7 shall be in addition to any liability which such Agent may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company and to each person, if any, who controls the
Company within the meaning of the Act.
8. Each Agent, in soliciting offers to purchase Securities from the
Company and in performing the other obligations of such Agent hereunder (other
than in respect of any purchase by an Agent as principal, pursuant to a Terms
Agreement or otherwise), is acting solely as an agent for the Company, and not
as principal. Each Agent will make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer to
23
purchase Securities from the Company has been accepted by the Company, but such
Agent shall not have any liability to the Company in the event such purchase for
any reason is not consummated. If the Company shall default on its obligation to
deliver Securities to a purchaser whose offer it has accepted, the Company shall
hold each Agent harmless against any loss, claim or damage arising from or as a
result of such default by the Company.
9. The respective indemnities, agreements, representations, warranties
and other statements by any Agent and the Company set forth in or pursuant to
this Agreement, shall remain in full force and effect regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Agent or the Company or any of its officers, directors or controlling
persons, and shall survive each delivery of and payment for any of the
Securities.
10. The provisions of this Agreement relating to the solicitation of
offers to purchase Securities may be suspended or terminated at any time by the
Company as to any or all Agents or by any Agent as to such Agent upon the giving
of written notice of such suspension or termination to such Agent or the
Company, as the case may be. In addition, this Agreement may be terminated at
any time by the Company as to any or all Agents or by any Agent as to such Agent
upon the giving of written notice of such suspension or termination to such
Agent or the Company, as the case may be. In the event of such suspension or
termination with respect to any Agent, (X) this Agreement shall remain in full
force and effect with respect to any Agent as to which such suspension or
termination has not occurred, (Y) this Agreement shall remain in full force and
effect with respect to rights and obligations of any party which have previously
accrued and which relate to Securities already issued or agreed to be issued (as
a result of the acceptance by the Company of any offer to purchase Securities)
at the time of such suspension or termination, and (Z) in any event, this
Agreement shall remain in full force and effect insofar as the fourth paragraph
of Section 2(a), and Sections 4(d), 4(e), 5, 7, 8 and 9 hereof are concerned.
11. Except as otherwise specifically provided herein or in the
Administrative Procedure, all statements, requests, notices and advices
hereunder shall be in writing, or by telephone if promptly confirmed in writing,
and if to [Agent Names] shall be sufficient in all respects when delivered or
sent by facsimile transmission or registered mail to [Agent Addresses], Fax No.
______________, Attention: _______________, and if to the Company shall be
sufficient in all respects when delivered or sent by facsimile transmission or
registered mail to X.X. Xxxxxx Company, 0000 Xxxxxx Xxxx Xxxxxxxxx, Xx. Xxxx,
Xxxxxxxxx 00000-0000, Fax No. _________________, Attention: _________________.
12. This Agreement and any Terms Agreement shall be binding upon, and
inure solely to the benefit of, each Agent and the Company, and to the extent
provided in Sections 7, 8 and 9 hereof, the officers and directors of the
Company and any person who controls any Agent or the Company, and their
respective personal representatives, successors and assigns, and no other person
shall acquire or have any right under or by virtue of this Agreement or any
Terms Agreement. No purchaser of any of the Securities through or from any Agent
hereunder shall be deemed a successor or assign by reason of such purchase.
24
13. This Agreement and any Terms Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
14. Time shall be of the essence in this Agreement and any Terms
Agreement. As used herein, the term "business day" shall mean any day when the
Commission's office in Washington, D.C. is open for business.
15. This Agreement and any Terms Agreement may be executed by any one or
more of the parties hereto and thereto in any number of counterparts, each of
which shall be an original, but all of such respective counterparts shall
together constitute one and the same instrument.
25
If the foregoing is in accordance with each of the Agents' understanding,
please sign and return to us five counterparts hereof, whereupon this letter and
the acceptance by each of the Agents thereof shall constitute a binding
agreement between the Company and each of the Agents in accordance with its
terms.
Very truly yours,
X.X. XXXXXX COMPANY
By:____________________________
Accepted in New York, New York, as of the
date hereof:
[Agent Names]
By: ________________________________
Authorized Signature
26
ANNEX I
X.X. Xxxxxx Company
$_____________ Medium-Term Notes, Series ______________
TERMS AGREEMENT
______________, ____
[Agent(s) Name(s) and Address(es)]
Ladies and Gentlemen:
X.X. Xxxxxx Company (the "Company") proposes, subject to the terms and
conditions stated herein and in the Distribution Agreement, dated _________, ___
(the "Distribution Agreement"), between the Company on the one hand and [Name(s)
of Agent(s)] on the other hand (the "Agents"), to issue and sell to [Name(s) of
Agent(s)] the securities specified in the Schedule hereto (the "Purchased
Securities"). Each of the provisions of the Distribution Agreement not
specifically related to the solicitation by the Agents, as agents of the
Company, of offers to purchase Securities is incorporated herein by reference in
its entirety, and shall be deemed to be part of this Terms Agreement to the same
extent as if such provisions had been set forth in full herein. Nothing
contained herein or in the Distribution Agreement shall make any party hereto an
agent of the Company or make such party subject to the provisions therein
relating to the solicitation of offers to purchase Securities from the Company,
solely by virtue of its execution of this Terms Agreement. Each of the
representations and warranties set forth therein shall be deemed to have been
made at and as of the date of this Terms Agreement, except that each
representation and warranty with respect to the Prospectus in Section 1 of the
Distribution Agreement shall be deemed to be a representation and warranty as of
the date of the Distribution Agreement in relation to the Prospectus (as therein
defined), and also a representation and warranty as of the date of this Terms
Agreement in relation to the Prospectus as amended and supplemented to relate to
the Purchased Securities.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Purchased Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Distribution Agreement incorporated herein by reference, the Company agrees to
issue and sell to you and you agree to purchase from the Company the Purchased
Securities, at the time and place, in the principal amount and at the purchase
price set forth in the Schedule hereto.
If for any reason the Purchased Securities are not delivered by or on
behalf of the Company, the Company will reimburse you for all out-of-pocket
expenses approved in
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writing by you, including fees and disbursements of counsel, reasonably incurred
by you in making preparations for the purchase, sale and delivery of the
Purchased Securities but then the Company shall be under no further liability to
you except as provided in Sections 5 and 7 of the Distribution Agreement.
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If the foregoing is in accordance with the understanding of the parties
hereto, please sign and return to us five counterparts hereof, and upon
acceptance hereof by the parties hereto, this letter and such acceptance hereof,
including those provisions of the Distribution Agreement incorporated herein by
reference, shall constitute a binding agreement between the parties hereto and
the Company.
X.X. XXXXXX COMPANY
By:________________________________
Authorized Officer
Accepted:
[Name(s) of Agent(s)]
By:____________________________]
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Schedule to Annex I
Title of Purchased Securities:
____% Medium-Term Notes, Series __
Aggregate Principal Amount:
$____________ or units of other Specified Currency
Price to Public:
Purchase Price by [Name(s) of Agent(s)]:
__% of the principal amount of the Purchased Securities, plus accrued
interest from ________________ to _________________ [and accrued
amortization, if any, from _____________ to _____________].
Method of Specified Funds for Payment of Purchase Price: Same Day Funds
Payment of Expenses:
Indenture:
Indenture, dated as of ____________, as amended or supplemented from time
to time between the Company and _________________________________, as
Trustee.
Time of Delivery:
Closing Location for Delivery of Securities:
Maturity:
Interest Rate:
[_____________%]
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Interest Payment Dates:
[months and dates]
Other Terms:
Documents to be Delivered:
The following documents referred to in the Distribution Agreement shall be
delivered as a condition to the Closing:
[(l) The officers' certificate referred to in Section 4(k).]
[(2) The opinions of counsel to the Company referred to in Section
4(i).]
[(3) The opinion of counsel to the Agents referred to in Section
4(h).]
[(4) The accountants' letters referred to in Section 4(j).]
Syndicate Provisions:
[Set forth any syndicate terms, including any restrictions on sales of
securities similar to the Purchased Securities.]
Procedures Relating to Settlement:
I-5
ANNEX II
X.X. XXXXXX COMPANY
Administrative Procedure
This Administrative Procedure relates to the Securities defined in the
Distribution Agreement, dated ______________, ____ (the "Distribution
Agreement"), among X.X. Xxxxxx Company (the "Company"), [Names of Agents]
(together, the "Agents"), to which this Administrative Procedure is attached as
Annex II. Defined terms used herein and not defined herein shall have the
meanings given such terms in the Distribution Agreement, the Prospectus as
amended or supplemented or the Indenture. To the extent any procedure set forth
below conflicts with the provisions of the Securities, the Indenture or the
Distribution Agreement, the relevant provisions of the Securities, the Indenture
and the Distribution Agreement shall control.
The procedures to be followed with respect to the settlement of sales of
Securities directly by the Company to purchasers solicited by an Agent, as
agent, are set forth below. The terms and settlement details related to a
purchase of Securities by an Agent, as principal, from the Company will be set
forth in a Terms Agreement pursuant to the Distribution Agreement, unless the
Company and such Agent otherwise agree as provided in Section 2(b) of the
Distribution Agreement, in which case the procedures to be followed in respect
of the settlement of such sale will be as set forth below. An Agent, in relation
to a purchase of a Security by a purchaser solicited by such Agent, is referred
to herein as the "Selling Agent" and, in relation to a purchase of a Security by
such Agent as principal other than pursuant to a Terms Agreement, as the
"Purchasing Agent".
The Company will advise each Agent in writing of those persons with whom
such Agent is to communicate regarding offers to purchase Securities and the
related settlement details.
The Trustee will be the initial Registrar, Calculation Agent,
Authenticating Agent and Paying Agent for the Securities and will perform the
duties specified herein. Each Security will be issued only in fully registered
form and will be represented by either a global security (a "Global Security")
delivered to the Trustee, as agent for The Depository Trust Company ("DTC"), and
recorded in the book-entry system maintained by DTC (a "Book-Entry Security") or
a certificate issued in definitive form (a "Certificated Security") delivered to
a person designated by an Agent, as set forth in the applicable Pricing
Supplement. An owner of a Book-Entry Security will not be entitled to receive a
certificate representing such a Security, except as provided in the Indenture.
Book-Entry Securities, which may be payable only in U.S. dollars, will be
issued in accordance with the Administrative Procedure set forth in Part I
hereof as they may subsequently be amended as the result of changes in DTC's
operating procedures and
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Certificated Securities will be issued in accordance with the Administrative
Procedure set forth in Part II hereof.
PART I: ADMINISTRATIVE PROCEDURE FOR BOOK-ENTRY SECURITIES
In connection with the qualification of the Book-Entry Securities for
eligibility in the book-entry system maintained by DTC, the Trustee will perform
the custodial, document control and administrative functions described below, in
accordance with its respective obligations under a Letter of Representations
from the Company and the Trustee to DTC, dated the date hereof, and a
Medium-Term Note Certificate Agreement between the Trustee and DTC dated as of
______________, ____ (the "Certificate Agreement"), and its obligations as a
participant in DTC, including DTC's Same-Day Funds Settlement System ("SDFS").
Posting Rates by the Company:
The Company and the Agents will discuss from time to time the rates of
interest per annum to be borne by and the maturity of Book-Entry Securities that
may be sold as a result of the solicitation of offers by an Agent. The Company
may establish a fixed set of interest rates and maturities for an offering
period ("posting"). If the Company decides to change already posted rates, it
will promptly advise the Agents to suspend solicitation of offers until the new
posted rates have been established with the Agents.
Acceptance of Offers by the Company:
Each Agent will promptly advise the Company by telephone or other
appropriate means of all reasonable offers to purchase Book-Entry Securities,
other than those rejected by such Agent. Each Agent may, in its discretion
reasonably exercised, reject any offer received by it in whole or in part. Each
Agent also may make offers to the Company to purchase Book-Entry Securities as a
Purchasing Agent. The Company will have the sole right to accept offers to
purchase Book-Entry Securities and may reject any such offer in whole or in
part.
The Company will promptly notify the Selling Agent or Purchasing Agent, as
the case may be, of its acceptance or rejection of an offer to purchase
Book-Entry Securities. If the Company accepts an offer to purchase Book-Entry
Securities, it will confirm such acceptance in writing to the Selling Agent or
Purchasing Agent, as the case may be, and the Trustee.
Communication of Sale Information to the Company by Selling Agent and Settlement
Procedures:
A. After the acceptance of an offer by the Company, the Selling Agent or
Purchasing Agent, as the case may be, will communicate promptly, but in no event
later than the time set forth under "Settlement Procedure Timetable" below, the
following details of the
II-2
terms of such offer (the "Sale Information") to the Company by telephone
(confirmed in writing) or by facsimile transmission or other acceptable written
means:
(1) Principal Amount of Book-Entry Securities to be purchased;
(2) If a Fixed Rate Book-Entry Security, the interest rate, the
Interest Payment Dates, the initial Interest Payment Date and
whether such Security is an Amortizing Security, and if so, the
amortization schedule;
(3) Trade Date;
(4) Settlement Date;
(5) Maturity Date;
(6) If denominated or payable in a currency other than U.S. dollars,
the relevant provisions relating thereto;
(7) If payments thereon are to be determined by reference to an
index, the relevant provisions relating thereto;
(8) Issue Price;
(9) Selling Agent's commission or Purchasing Agent's discount, as the
case may be;
(10) Net Proceeds to the Company;
(11) If a redeemable or repayable Book-Entry Security, provisions
relating to such redemption or repayment;
(12) If a Floating Rate Book-Entry Security, such of the following as
are applicable:
(i) Interest Rate Basis,
(ii) Index Maturity,
(iii) Spread or Spread Multiplier,
(iv) Maximum Rate,
(v) Minimum Rate,
(vi) Initial Interest Rate,
(vii) Interest Reset Dates,
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(viii) Calculation Dates,
(ix) Interest Determination Dates,
(x) Interest Payment Dates,
(xi) Regular Record Dates, and
(xii) Calculation Agent;
(13) Name, address and taxpayer identification number of the
registered owner(s);
(14) Denomination of certificates to be delivered at settlement;
(15) Selling Agent or Purchasing Agent;
(16) Original Issue Discount provisions, if any; and
(17) Any other applicable terms.
B. After receiving the Sale Information from the Selling Agent or
Purchasing Agent, as the case may be, the Company will communicate such Sale
Information to the Trustee by facsimile transmission or other acceptable written
means. The Trustee will assign a CUSIP number to the Global Security from a list
of CUSIP numbers previously delivered to the Trustee by the Company representing
such Book-Entry Security and then advise the Company and the Selling Agent or
Purchasing Agent, as the case may be, of such CUSIP number.
C. The Trustee will enter a pending deposit message through DTC's
Participant Terminal System, providing the following settlement information to
DTC, and DTC shall forward such information to such Agent and Standard & Poor's
Corporation:
(1) The applicable Sale Information;
(2) CUSIP number of the Global Security representing such Book-Entry
Security;
(3) Whether such Global Security will represent any other Book-Entry
Security (to the extent known at such time);
(4) Number of the participant account maintained by DTC on behalf of
the Selling Agent or Purchasing Agent, as the case may be;
(5) Whether such Security is an Amortizing Security (by an
appropriate notation in the comments field of DTC's Participant
Terminal System);
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(6) The interest payment period; and
(7) Initial Interest Payment Date for such Book-Entry Security.
D. The Trustee will complete the Global Security, in the form previously
approved by the Company, the Agents and the Trustee.
E. The Trustee will authenticate the Global Security representing such
Book-Entry Security.
F. DTC will credit such Book-Entry Security to the Trustee's participant
account at DTC.
G. The Trustee will enter an SDFS deliver order through DTC's Participant
Terminal System instructing DTC to (i) debit such Book-Entry Security to the
Trustee's participant account and credit such Book-Entry Security to such
Agent's participant account at DTC, and (ii) debit such Agent's settlement
account and credit the Trustee's settlement account for an amount equal to the
price of such Book-Entry Security less such Agent's commission. The entry of
such a deliver order shall constitute a representation and warranty by the
Trustee to DTC that (a) the Global Security representing such Book-Entry
Security has been issued and authenticated and (b) the Trustee is holding such
Global Security pursuant to the Certificate Agreement.
H. Unless the relevant Agent is the end purchaser of such security, such
Selling or Purchasing Agent, as the case may be, will enter an SDFS deliver
order through DTC's Participant Terminal System instructing DTC (i) to debit
such Book-Entry Security to such Agent's participant account and credit such
Book-Entry Security to the participant accounts of the participants with respect
to such Book-Entry Security and (ii) to debit the settlement accounts of such
participants and credit the settlement account of such Agent for an amount equal
to the price of such Book-Entry Security.
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. Upon confirmation of receipt of funds, the Trustee will transfer to
the Company's account, account number ______________________, maintained at
__________, ______________, ________________, or such other account as the
Company may have previously specified to the Trustee, in funds available for
immediate use in the amount transferred to the Trustee in accordance with
Settlement Procedure "G".
K. Upon request, the Trustee will send to the Company a statement setting
forth the principal amount of Book-Entry Securities outstanding as of that date
under the Indenture.
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L. Unless the relevant Agent is the end purchaser of such security, such
Selling or Purchasing Agent, as the case may be, will confirm the purchase of
such Book-Entry Security to the purchaser either by transmitting to the
participants with respect to such Book-Entry Security a confirmation order or
orders through DTC's institutional delivery system or by mailing a written
confirmation to such purchaser.
M. DTC will, at any time, upon request of the Company or the Trustee,
promptly furnish to the Company or the Trustee a list of the names and addresses
of the participants for whom DTC has credited Book-Entry Securities.
Preparation of Pricing Supplement by Company:
If the Company accepts an offer to purchase a Book-Entry Security, it will
prepare a Pricing Supplement reflecting the terms of such Security and arrange
to have delivered to the Selling Agent or Purchasing Agent, as the case may be,
at least ten copies of such Pricing Supplement, not later than 11:00 a.m., New
York City time, on the Business Day following the Trade Date (as defined below).
The Company will arrange to file a copy of the Pricing Supplement with the
Commission not later than the close of business of the Commission on the fifth
Business Day following the date on which such Pricing Supplement is first used.
In each instance that a Pricing Supplement is prepared, the relevant Agent
will provide a copy of such Pricing Supplement to each investor or purchaser of
the relevant Book-Entry Security or its agent. Pursuant to Rule 434 under the
Securities Act, the Pricing Supplement may be delivered separately from the
Prospectus. Outdated Pricing Supplements (other than those retained for files)
will be destroyed.
Delivery of Confirmation and Prospectus to Purchaser by Selling Agent:
The Selling Agent will deliver to the purchaser of a Book-Entry Security a
written confirmation of the sale and delivery and payment instructions. In
addition, the Selling Agent will deliver to such purchaser or its agent the
Prospectus as amended or supplemented (including the Pricing Supplement) in
relation to such Book-Entry Security prior to or together with the earlier of
the delivery to such purchaser or its agent of (a) the confirmation of sale or
(b) the Book-Entry Security.
Date of Settlement:
The receipt by the Company of immediately available funds in payment for a
Book-Entry Security and the authentication and issuance of the Global Security
representing such Book-Entry Security shall constitute "settlement" with respect
to such Book-Entry Security. All orders of Book-Entry Securities solicited by a
Selling Agent or made by a Purchasing Agent and accepted by the Company on a
particular date (the "Trade Date") will be settled on a date (the "Settlement
Date") which is on or before the third Business Day
II-6
after the Trade Date pursuant to the "Settlement Procedure Timetable" set forth
below, unless the Company and the purchaser agree to settlement on another day,
which shall be no earlier than the next Business Day after the Trade Date.
Settlement Procedure Timetable:
For offers to purchase Book-Entry Securities solicited by a Selling Agent
and accepted by the Company for settlement on the first Business Day after the
Trade Date, Settlement Procedures "A" through "J" set forth above shall be
completed as soon as possible but not later than the respective times (New York
City time) set forth below:
Settlement
Procedure Time
------------ --------------------------------------
A-B 11:00 a.m. on the Trade Date
C 2:00 p.m. on the Trade Date
D 3:00 p.m. on the day before the Settlement Date
E 9:00 a.m. on the Settlement Date
F 10:00 a.m. on the Settlement Date
G 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
If a sale is to be settled more than one Business Day after the Trade Date,
Settlement Procedures A, B and C shall be completed as soon as practicable but
in no event later that 11:00 a.m. and 2:00 p.m., as the case may be, on the
first Business Day after the Trade Date. If the initial interest rate for a
Floating Rate Book-Entry Security has not been determined at the time that
Settlement Procedure "A" is completed and the Settlement Date is at least three
Business Days after the Trade Date, Settlement Procedures "B" and "C" shall be
completed as soon as such rate has been determined but no later than 11:00 a.m.
and 12:00 noon, respectively, on the second Business Day immediately preceding
the Settlement Date. Settlement Procedure "I" is subject to extension in
accordance with any extension of Fedwire closing deadlines and in the other
events specified in the SDFS operating procedures in effect on the Settlement
Date.
If settlement of a Book-Entry Security is rescheduled or cancelled, the
Trustee, upon obtaining knowledge thereof, will deliver to DTC, through DTC's
Participant Terminal System, a cancellation message to such effect by no later
than 2:00 p.m. on the Business Day immediately preceding the scheduled
Settlement Date.
Failure to Settle:
If the Trustee fails to enter an SDFS deliver order with respect to a
Book-Entry Security 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
II-7
DTC to debit such Book-Entry Security to the Trustee's participant account,
provided that the Trustee's participant account contains a principal amount of
the Global Security representing such Book-Entry Security that is at least equal
to the principal amount to be debited. If a withdrawal message is processed with
respect to all the Book-Entry Securities represented by a Global Security, the
Trustee will xxxx such Global Security "cancelled", make appropriate entries in
the Trustee's records and send such cancelled Global Security to the Company.
The CUSIP number assigned to such Global Security shall, in accordance with the
procedures of the CUSIP Service Bureau of Standard & Poor's Corporation, be
cancelled and not immediately reassigned. If a withdrawal message is processed
with respect to one or more, but not all, of the Book-Entry Securities
represented by a Global Security, the Trustee will exchange such Global Security
for two Global Securities, one of which shall represent such Book-Entry Security
or Securities and shall be cancelled immediately after issuance and the other of
which shall represent the remaining Book-Entry Securities previously represented
by the surrendered Global Security and shall bear the CUSIP number of the
surrendered Global Security.
If the purchase price for any Book-Entry Security is not timely paid to the
participants with respect to such Book-Entry Security by the beneficial
purchaser thereof (or a person, including an indirect participant in DTC, acting
on behalf of such purchaser), such participants and, in turn, the Agent for such
Book-Entry Security may enter delivery orders through DTC's Participant Terminal
System debiting such Book-Entry Security to such participant's account and
crediting such Book-Entry Security to such Agent's account and then debiting
such Book-Entry Security to such Agent's participant account and crediting such
Book-Entry Security to the Trustee's participant account and shall notify the
Company and the Trustee thereof. Thereafter, the Trustee will (i) immediately
notify the Company of such order and the Company shall transfer to such Agent
funds available for immediate use in an amount equal to the price of such
Book-Entry Security which was credited to the account of the Company maintained
at the Trustee in accordance with Settlement Procedure J, and (ii) deliver the
withdrawal message and take the related actions described in the preceding
paragraph. If such failure shall have occurred for any reason other than default
by the applicable Agent to perform its obligations hereunder or under the
Distribution Agreement, the Company will reimburse such Agent on an equitable
basis for the loss of its use of funds during the period when the funds were
credited to the account of the Company.
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Notwithstanding the foregoing, upon any failure to settle with respect to a
Book-Entry Security, DTC may take any actions in accordance with its SDFS
operating procedures then in effect. In the event of a failure to settle with
respect to one or more, but not all, of the Book-Entry Securities to have been
represented by a Global Security, the Trustee will provide, in accordance with
Settlement Procedures "D", "E" and G, for the authentication and issuance of a
Global Security representing the other Book-Entry Securities to have been
represented by such Global Security and will make appropriate entries in its
records. The Company will, from time to time, furnish the Trustee with a
sufficient quantity of Securities.
PART II: ADMINISTRATIVE PROCEDURE FOR CERTIFICATED SECURITIES
Posting Rates by Company:
The Company and the Agents will discuss from time to time the rates of
interest per annum to be borne by and the maturity of Certificated Securities
that may be sold as a result of the solicitation of offers by an Agent. The
Company may establish a fixed set of interest rates and maturities for an
offering period ("posting"). If the Company decides to change already posted
rates, it will promptly advise the Agents to suspend solicitation of offers
until the new posted rates have been established with the Agents.
Acceptance of Offers by Company:
Each Agent will promptly advise the Company by telephone or other
appropriate means of all reasonable offers to purchase Certificated Securities,
other than those rejected by such Agent. Each Agent may, in its discretion
reasonably exercised, reject any offer received by it in whole or in part. Each
Agent also may make offers to the Company to purchase Certificated Securities as
a Purchasing Agent. The Company will have the sole right to accept offers to
purchase Certificated Securities and may reject any such offer in whole or in
part.
The Company will promptly notify the Selling Agent or Purchasing Agent, as
the case may be, of its acceptance or rejection of an offer to purchase
Certificated Securities. If the Company accepts an offer to purchase
Certificated Securities, it will confirm such acceptance in writing to the
Selling Agent or Purchasing Agent, as the case may be, and the Trustee.
Communication of Sale Information to the Company by Selling Agent:
After the acceptance of an offer by the Company, the Selling Agent or
Purchasing Agent, as the case may be, will communicate promptly on the Sale Date
the following details of the terms of such offer (the "Sale Information") to the
Company by telephone (confirmed in writing) or by facsimile transmission or
other acceptable written means:
(1) Principal Amount of Certificated Securities to be purchased;
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(2) If a Fixed Rate Certificated Security, the interest rate, the Interest
Payment Dates, the initial Interest Payment Date and whether such
Security is an Amortizing Security, and if so, the Amortization
Schedule;
(3) Trade Date;
(4) Settlement Date;
(5) Maturity Date;
(6) If denominated or payable in a currency other than U.S. dollars, the
relevant provisions relating thereto;
(7) If payments thereon are to be determined by reference to an index, the
relevant provisions relating thereto;
(8) Issue Price;
(9) Selling Agent's commission or Purchasing Agent's discount, as the case
may be;
(10) Net Proceeds to the Company;
(11) If a redeemable or repayable Certificated Security, provisions
relating to such redemption or repayment;
(12) If a Floating Rate Certificated Security, such of the following as are
applicable:
(i) Interest Rate Basis,
(ii) Index Maturity,
(iii) Spread or Spread Multiplier,
(iv) Maximum Rate,
(v) Minimum Rate,
(vi) Initial Interest Rate,
(vii) Interest Reset Dates,
(viii) Calculation Dates,
(ix) Interest Determination Dates,
(x) Interest Payment Dates,
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(xi) Regular Record Dates, and
(xii) Calculation Agent;
(13) Name, address and taxpayer identification number of the registered
owner(s) and address for payment of principal and interest;
(14) Denomination of certificates to be delivered at settlement;
(15) Original Issue Discount provisions, if any;
(16) Selling Agent or Purchasing Agent; and
(17) Any other applicable terms.
Preparation of Pricing Supplement by Company:
If the Company accepts an offer to purchase a Certificated Security, it
will prepare a Pricing Supplement reflecting the terms of such Certificated
Security and arrange to have delivered to the Selling Agent or Purchasing Agent,
as the case may be, at least ten copies of such Pricing Supplement, not later
than 5:00 p.m., New York City time, on the Business Day following the Trade
Date, or if the Company and the purchaser agree to settlement on the date of
acceptance of such offer, not later than noon, New York City time, on such date.
The Company will arrange to file a copy of the Pricing Supplement with the
Commission not later than the close of business of the Commission on the fifth
Business Day following the date on which such Pricing Supplement is first used.
In each instance that a Pricing Supplement is prepared, the relevant Agent
will provide a copy of such Pricing Supplement to each investor or purchaser of
the relevant Certificated Security or its agent. Pursuant to Rule 434 under the
Securities Act, the Pricing Supplement may be delivered separately from the
Prospectus. Outdated Pricing Supplements (other than those retained for files)
will be destroyed.
Delivery of Confirmation and Prospectus to Purchaser by Selling Agent:
The Selling Agent will deliver to the purchaser of a Certificated Security
a written confirmation of the sale and delivery and payment instructions. In
addition, the Selling Agent will deliver to such purchaser or its agent the
Prospectus as amended or supplemented (including the Pricing Supplement) in
relation to such Certificated Security prior to or together with the earlier of
the delivery to such purchaser or its agent of (a) the confirmation of sale or
(b) the Certificated Security.
Date of Settlement:
All offers of Certificated Securities solicited by a Selling Agent or made
by a Purchasing Agent and accepted by the Company will be settled on a date (the
"Settlement Date") which is the third Business Day after the date of acceptance
of such offer, unless the
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Company and the purchaser agree to settlement (a) on another Business Day after
the acceptance of such offer or (b) with respect to an offer accepted by the
Company prior to 10:00 a.m., New York City time, on the date of such acceptance.
Instruction from Company to Trustee for Preparation of Certificated Securities:
After receiving the Sale Information from the Selling Agent or Purchasing
Agent, as the case may be, the Company will communicate such Sale Information to
the Trustee by telephone (confirmed in writing) or by facsimile transmission or
other acceptable written means.
The Company will instruct the Trustee by facsimile transmission or other
acceptable written means to authenticate and deliver the Certificated Securities
no later than 12:00 noon, New York City time, on the Settlement Date. Such
instruction will be given by the Company prior to 3:00 p.m., New York City time,
on the Business Day immediately preceding the Settlement Date unless the
Settlement Date is the date of acceptance by the Company of the offer to
purchase Certificated Securities, in which case such instruction will be given
by the Company by 11:00 a.m., New York City time.
Preparation and Delivery of Certificated Securities by Trustee and Receipt of
Payment Therefor:
The Trustee will prepare each Certificated Security and appropriate
receipts that will serve as the documentary control of the transaction.
In the case of a sale of Certificated Securities to a purchaser solicited
by a Selling Agent, the Trustee will, by 12:00 noon, New York City time, on the
Settlement Date, deliver the Certificated Securities to the Selling Agent for
the benefit of the purchaser of such Certificated Securities against delivery by
the Selling Agent of a receipt therefor. On the Settlement Date the Selling
Agent will deliver payment for such Certificated Securities in immediately
available funds to the Company in an amount equal to the issue price of the
Certificated Securities less the Selling Agent's commission on or before 12:00
noon, New York City time, on the Settlement Date. The Company shall not use any
proceeds advanced by a Selling Agent to acquire securities prior to the Selling
Agent receiving the Certificated Securities from the Company.
In the case of a sale of Certificated Securities to a Purchasing Agent, the
Trustee will, by 12:00 noon, New York City time, on the Settlement Date, deliver
the Certificated Securities to the Purchasing Agent against delivery of payment
for such Certificated Securities in immediately available funds to the Company
in an amount equal to the issue price of the Certificated Securities less the
Purchasing Agent's discount.
Failure of Purchaser to Pay Selling Agent:
If a purchaser (other than a Purchasing Agent) fails to make payment to the
Selling Agent for a Certificated Security, the Selling Agent will promptly
notify the Trustee and the
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Company thereof by telephone (confirmed in writing) or by facsimile transmission
or other acceptable written means. The Selling Agent will immediately return the
Certificated Security to the Trustee. Immediately upon receipt of such
Certificated Security by the Trustee, the Company will return to the Selling
Agent an amount equal to the amount previously paid to the Company in respect of
such Certificated Security. If the failure shall have occurred for any reason
other than a default by such Selling Agent in the performance of its obligations
hereunder and under the Distribution Agreement, then the Company will reimburse
the Selling Agent on an equitable basis for its loss of the use of funds during
the period when they were credited to the account of the Company.
The Trustee will cancel the Certificated Security in respect of which the
failure occurred, make appropriate entries in its records and, unless otherwise
instructed by the Company, destroy the Certificated Security.
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