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Citigroup Inc.
Medium-Term Senior Notes, Series D
Medium-Term Subordinated Notes, Series D
Due Nine Months or More from the Date of Issue
DISTRIBUTION AGREEMENT
December 14, 2000
Xxxxxxx Xxxxx Xxxxxx Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Citigroup Inc., a Delaware corporation (the "Company"), confirms its
agreement with the Agent (as defined below) with respect to the issue and sale
by the Company of its Medium-Term Senior Notes, Series D, Due Nine Months or
More from the Date of Issue (the "Senior Notes") and its Medium-Term
Subordinated Notes, Series D, Due Nine Months or More from the Date of Issue
(the "Subordinated Notes" and, together with the Senior Notes, the "Notes"). The
Senior Notes are to be issued under an Indenture dated as of March 15, 1987, as
supplemented by the First Supplemental Indenture dated as of December 15, 1988,
the Second Supplemental Indenture dated as of January 31, 1991, the Third
Supplemental Indenture dated as of December 9, 1992 and the Fourth Supplemental
Indenture dated as of November 2, 1998 (as so supplemented or as it may from
time to time be further supplemented or amended by one or more indentures
supplemental thereto, the "Senior Debt Indenture"), between the Company and The
Bank of New York, as trustee (the "Senior Debt Trustee"). The Subordinated Notes
are to be issued under an Indenture dated as of July 17, 1998, as supplemented
by the First Supplemental Indenture dated as of December 15, 1998 and the Second
Supplemental Indenture dated as of January 21, 1999 (as so supplemented or as it
may from time to time be further supplemented or amended by one or more
indentures supplemental thereto, the "Subordinated Debt Indenture" and, together
with the Senior Debt Indenture, the "Indentures"), between the Company and Bank
One Trust Company, N.A. (as successor in interest to The First National Bank of
Chicago), as trustee (the "Subordinated Debt
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Trustee" and, together with the Senior Debt Trustee, the "Trustees"). The Notes
will have the maturities, interest rates (whether fixed or floating), redemption
provisions and other terms set forth in pricing supplements to the Prospectus
referred to below. The Notes may be denominated in U.S. dollars, foreign
currencies or foreign composite currency units (the "Specified Currency") as may
be specified in the applicable pricing supplement.
Subject to the terms and conditions stated herein and subject to the
reservation by the Company of the right to sell Notes to the Agent acting as
principal at a discount for its own account or for resale to one or more
investors or other dealers and the Company's right to sell Notes directly to
investors on its own behalf or through other agents (provided that any other
agent will execute an agreement with the Company substantially in the form of
Exhibit F hereto and that the Company will notify the Agent of its agreement
with any other agents, dealers or underwriters, but only if such other agents,
dealers or underwriters are appointed for the duration of this Agreement), the
Company hereby appoints the Agent as an agent of the Company for the purpose of
soliciting offers to purchase the Notes. In addition, the Agent may also
purchase Notes as principal and the Company will enter into a Terms Agreement
(referred to below) relating to such sale in accordance with the provisions of
Section l(b) hereof. For the purposes of this Agreement, the term "Agent" shall
refer to Xxxxxxx Xxxxx Xxxxxx Inc.
1. Solicitations by the Agent of Offers to Purchase; Purchases as
Principal.
(a) Solicitations as Agent. Following the Commencement Date (as
defined below), the Company shall notify the Agent from time to time as to the
commencement of a period during which the Notes may be offered and sold by the
Agent (each period, commencing with such a notification and ending at such time
as the authorization for offers and sales through the Agent shall have been
suspended by the Company or the Agent as provided hereunder, being herein
referred to as an "Offering Period"). On the basis of the representations and
warranties herein contained, but subject to the terms and conditions herein set
forth, the Agent agrees to use its reasonable best efforts to solicit offers to
purchase the Notes during each Offering Period upon the terms and conditions set
forth in the Prospectus as then amended and supplemented. The Company reserves
the right, in its sole discretion, to suspend solicitation of purchases of the
Notes commencing at any time for any period of time or permanently. Upon receipt
of instructions from the Company, the Agent will forthwith suspend solicitation
of purchases from the Company until such time as the Company has advised the
Agent that such solicitation may be resumed.
Unless otherwise agreed to, the Company agrees to pay the Agent at
the time of delivery of and payment for the Notes, as consideration for
soliciting the sale of each Note, a commission equal to the percentage set forth
on Schedule 1 hereto of the
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price to the public of each Note sold by the Company as the result of a
solicitation by the Agent. Without the prior approval of the Company, the Agent
(acting on an agency basis) may not reallow any portion of the commission
payable pursuant hereto to dealers or purchasers in connection with the offer
and sale of any Notes.
The Agent is authorized to solicit orders for the Notes only in
principal amounts of $1,000 or any amount in excess thereof which is a multiple
of $1,000 or, in the case of Notes denominated in a Specified Currency other
than U.S. dollars, in the denominations set forth in the applicable pricing
supplement, at a purchase price equal to 100% of the principal amount of the
Notes, unless otherwise mutually agreed upon by the purchaser and the Company
and specified in the applicable pricing supplement. The Agent shall communicate
to the Company, orally or in writing, each reasonable offer or indication of
interest to purchase Notes received by the Agent, as agent. The Company shall
have the sole right to accept offers to purchase the Notes and may reject any
such offer in whole or in part. The Agent shall have the right to reject, in its
discretion reasonably exercised, any offer received by it to purchase the Notes,
in whole or in part, and any such rejection shall not be deemed a breach of its
agreements contained herein. In soliciting offers to purchase the Notes in its
capacity as agent of the Company, the Agent is acting solely as agent for the
Company, and not as principal, and does not assume any obligation toward, or
relationship of agency or trust with, any purchaser of the Notes (other than any
such obligation or relationship which the Agent assumes independently of this
Agreement). The Agent shall make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer to purchase Notes has been
solicited by the Agent and accepted by the Company, but the Agent shall not have
any liability to the Company in the event any such purchase is not consummated
for any reason. Under no circumstances will the Agent be obligated to purchase
any Notes for its own account except pursuant to subparagraph (b) below.
(b) Purchases as Principal. Each sale of Notes to the Agent as
principal shall be made in accordance with the terms of this Agreement and the
Agent and the Company will enter into a Terms Agreement that will provide for
the sale of such Notes to and the purchase thereof by the Agent. Each "Terms
Agreement" may take the form of an exchange of any form of written
telecommunication or oral communication followed by written confirmation or
telecommunication between the Agent and the Company and shall be with respect to
such information (as applicable) as is specified in Exhibit A hereto.
The Agent's commitment to purchase Notes as principal shall be
deemed to have been made on the basis of the representations and warranties of
the Company herein contained and shall be subject to the terms and conditions
herein set forth. Each agreement by the Agent to purchase Notes as principal
(whether or not set forth in a
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Terms Agreement) shall specify the principal amount of Notes to be purchased by
the Agent pursuant thereto, the maturity date of such Notes, the price to be
paid to the Company for such Notes, the interest rate and interest rate formula,
if any, applicable to such Notes and any other terms of such Notes. Each such
agreement shall also specify any requirements for officers' certificates,
opinions of counsel and letters from the independent public accountants of the
Company pursuant to Section 4 hereof. A Terms Agreement may also specify certain
provisions relating to the reoffering of such Notes by the Agent.
Each Terms Agreement shall specify the time and place of delivery of
and payment for such Notes. Each date of delivery of and payment for Notes to be
purchased by the Agent as principal or as agent or by any other purchaser is
referred to herein as a "Settlement Date."
Upon the Company's request, the Agent will notify the Company either
orally or in writing (as specified by the Company) of the aggregate principal
amount of Notes held by the Agent as principal purchased pursuant to a Terms
Agreement pursuant to this Agreement.
(c) Procedures. The Agent and the Company agree to perform the
respective duties and obligations specifically provided to be performed by them
in the Medium-Term Notes Administrative Procedures attached hereto as Exhibit B
(the "Procedures"). The Procedures may be amended only by written agreement of
the Company and the Agent.
(d) Delivery. The documents required to be delivered by Section 4 of
this Agreement shall be delivered at the office of Skadden, Arps, Slate Xxxxxxx
& Xxxx LLP ("Skadden, Arps") (or such other counsel reasonably satisfactory to
both the Agent and the Company), Four Times Square, New York, NY 10036-6522, on
December 14, 2000 (the "Commencement Date").
2. Representations and Warranties. The Company represents and warrants to,
and agrees with, the Agent as of the Commencement Date:
(a) a registration statement on Form S-3 (File No. 333-49442), as
amended by Amendment No.1 thereto, has been filed with and declared effective
by the Securities and Exchange Commission (the "Commission") on November 21,
2000, in respect of up to $25,000,000,000 aggregate amount of securities of the
Company, including the Notes, (of which $20,750,000,000 remains available for
issuance and sale as of the date hereof). Such registration statement and any
post-effective amendments thereto, in the forms heretofore delivered or to be
delivered to the Agent, excluding exhibits to such registration statement but
including all documents incorporated by reference therein, has been declared
effective by the Commission in such form. No other document with respect to such
registration statement (other than a document incorporated by reference therein)
has heretofore been filed or transmitted for filing with the Commission; and no
stop order suspending the effectiveness of such registration statement has been
issued and no proceeding for that purpose has been instituted or threatened by
the Commission.
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The various parts of such registration statement, including all exhibits thereto
and the documents incorporated by reference in the prospectus contained in such
registration statement at the time such part became effective but excluding the
Statements of Eligibility under the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"), pertaining to the Indentures (the "Forms T-1"), as
amended at the time such part became effective, are being hereinafter
collectively called the "Registration Statement." Any preliminary prospectus
included in the Registration Statement or filed with the Commission pursuant to
Rule 424(a) of the rules and regulations of the Commission under the Securities
Act of 1933, as amended (the "Act"), is hereinafter called a "Priliminary
Prospectus". The form of basic prospectus included in the Registration Statement
relating to the offering and sale of Debt Securities, Index Warrants, Preferred
Stock, Common Stock and Depositary Shares, 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 being hereinafter called the "Basic
Prospectus." The form of prospectus supplement to the Basic Prospectus relating
to the offering and sale of the Notes included in the Registration Statement, 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 being hereinafter
called the "Prospectus Supplement." The Basic Prospectus, as supplemented by the
Prospectus Supplement, is being hereinafter called the "Prospectus." Any
reference herein to any Preliminary Prospectus, the Prospectus Supplement or the
Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to the applicable form under the Act, as of the date
of such Preliminary Prospectus, Prospectus Supplement or Prospectus, as the case
may be. Any reference to any amendment or supplement to any Preliminary
Prospectus, the Prospectus Supplement or the Prospectus, including any
supplement to the Prospectus that sets forth only the terms of a particular
issue of the Notes (a "Pricing Supplement"), shall be deemed to refer to and
include any documents filed after the date of such Preliminary Prospectus,
Prospectus Supplement or the Prospectus, as the case may be, under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
incorporated by reference in such Preliminary Prospectus, the Prospectus
Supplement or the Prospectus, as the case may be. Any reference to any amendment
to the Registration Statement shall be deemed to include any report of the
Company filed pursuant to the Exchange Act after the effective date of the
Registration Statement that is incorporated by reference in the Registration
Statement. Any reference to the Prospectus, as amended or supplemented, shall be
deemed to refer to and include the Prospectus, as amended or supplemented, in
relation to the Notes sold pursuant to this Agreement, in the form in which it
is filed with the Commission pursuant to Rule 424(b) under the Act, 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
promulgated thereunder, 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.
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(c) Each of the Registration Statement and the Prospectus, and any
amendment thereof or supplement thereto, and each of the Indentures, conform or
will conform in all material respects with the applicable requirements of the
Act and the Trust Indenture Act, and the rules and regulations of the Commission
thereunder.
(d) The Registration Statement, as amended as of any time, did not
and will not, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order to make
the statements therein not misleading and the Prospectus, as amended and
supplemented as of any such time, did not and will not include any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements made, in the light of the circumstances under which they
were made, not misleading; provided, however, that the Company makes no
representations or warranties as to the information contained in or omitted from
the Registration Statement or the Prospectus or any amendment thereof or
supplement thereto in reliance upon, and in conformity with, information
furnished in writing to the Company by or on behalf of the Agent specifically
for use in the Registration Statement or the Prospectus or any amendment thereof
or supplement thereto.
(e) The Notes have been duly authorized and, when executed and
authenticated in accordance with the applicable Indenture and delivered to and
duly paid for by the purchasers thereof, will constitute valid and binding
obligations of the Company, enforceable in accordance with their respective
terms and entitled to the benefits of the applicable Indenture (subject, as to
enforcement, to applicable bankruptcy, reorganization, insolvency, moratorium or
other similar laws affecting creditors' rights generally and to general
principles of equity regardless of whether such enforceability is considered in
a proceeding in equity or at law); each of the Indentures has been duly
authorized by the Company and qualified under the Trust Indenture Act; and the
Indentures conform to the descriptions thereof in the Prospectus as amended or
supplemented to relate to such issuance of Notes.
(f) Since the date of the most recent financial statements included
in the Prospectus, as amended or supplemented, there has not been any material
adverse change in the consolidated financial condition or results of operations
of the Company and its subsidiaries, taken as a whole, which is not disclosed in
the Prospectus, as amended or supplemented.
3. Agreements of the Company. The Company agrees with the Agent that:
(a) At any time during an Offering Period or during the time a
prospectus relating to the Notes is required to be delivered under the Act,
prior to amending or supplementing the Registration Statement or the Prospectus,
the Company will furnish the Agent and the Agent's counsel with a copy of each
proposed amendment or supplement (other than an amendment or supplement to be
made pursuant to incorporation by reference of a document filed under the
Exchange Act, or a Pricing Supplement or an amendment or supplement relating
solely to an offering of debt securities other than the Notes). The Company will
promptly cause the Prospectus
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together with each amendment thereof or supplement thereto to be transmitted to
the Commission for filing pursuant to Rule 424(b) by an appropriate method or
will promptly cause the Prospectus together with each amendment thereof or
supplement thereto to be filed with the Commission pursuant to said Rule. If the
Prospectus is amended or supplemented (other than a Pricing Supplement or an
amendment or supplement relating solely to an offering of debt securities other
than the Notes), the Agent shall be furnished with such information relating to
such filing as it may reasonably request, and the Agent shall not be obligated
to solicit offers to purchase Notes so long as it is not reasonably satisfied
that such amendment or supplement complies in all material respects with the
provisions of the Act and the Exchange Act. At any time during an Offering
Period or during the time a prospectus relating to the Notes is required to be
delivered under the Act, the Company will promptly advise the Agent of (i) the
filing of any amendment or supplement to the Prospectus (other than a Pricing
Supplement or an amendment or supplement relating solely to an offering of debt
securities other than the Notes), (ii) the filing or effectiveness of any
amendment to the Registration Statement, (iii) the receipt by the Company of
comments from the Commission relating to, or requests by the Commission for, any
amendment of the Registration Statement or any amendment of or supplement to the
Prospectus or for any additional information, (iv) the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the institution or threatening of any proceeding for that purpose
and (v) the receipt by the Company of any notification with respect to the
suspension of the qualification of the Notes for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purpose. The Company will
use its reasonable best efforts to prevent the issuance of any such stop order
or notice of suspension of qualification and, if issued, to obtain as soon as
possible the withdrawal thereof. Upon the Agent's request, the Company will
within a reasonable time inform the Agent of the aggregate principal amount of
Notes registered under the Registration Statement that remain unissued.
(b) Within the time during which a prospectus relating to the Notes
is required to be delivered under the Act, the Company will comply with all
requirements imposed upon it by the Act, as now and hereafter amended, and by
the rules and regulations of the Commission thereunder, as from time to time in
force, so far as necessary to permit the continuance of sales of or dealings in
the Notes as contemplated by the provisions hereof and the Prospectus. If during
such period any event occurs 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 a material fact necessary to make the statements therein, in the light of
the circumstances then existing, not misleading, or if, in the opinion of the
Company, during such period it is necessary to amend or supplement the
Registration Statement or the Prospectus to comply with the Act, the Company
will promptly notify the Agent to suspend the solicitation of offers to purchase
the Notes in its capacity as Agent and to cease sales of any Notes it may then
own as principal and, to the extent required under the provision in the last
sentence of this subsection (b), the Company will promptly amend or supplement
the Registration Statement or the Prospectus (at the expense of the Company) so
as to correct such statement or omission or effect such compliance. If such
amendment or supplement, and any documents, certificates, opinions and letters
furnished to the Agent pursuant to subsections (i), (j) and (k) of this Section
3 in connection with the preparation and filing of such amendment or
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supplement are reasonably satisfactory in all respects to the Agent, upon the
filing of such amendment or supplement with the Commission or effectiveness of
an amendment to the Registration Statement, the Agent will resume solicitation
of offers to purchase Notes hereunder. Notwithstanding the foregoing, the
Company shall not be required to comply with the provisions of subsection (b) of
this Section 3 during any period from the time the Agent shall have been
notified to suspend the solicitation of offers to purchase the Notes in its
capacity as Agent (whether under this subparagraph (b) or otherwise under this
Agreement) to the time the Company shall determine that solicitation of offers
to purchase the Notes should be resumed; provided that if the Agent holds any
Notes as principal purchased pursuant to a Terms Agreement or otherwise pursuant
to this Agreement, the Company shall comply with the provisions of subsection
(b) of this Section 3 during the period when a Prospectus is required to be
delivered pursuant to the Act.
(c) The Company will comply, in a timely manner, with all applicable
requirements under the Exchange Act relating to the filing with the Commission
of the Company's reports pursuant to Sections 13(a), 13(c) or 15(d) of the
Exchange Act and, if then applicable, of the Company's proxy statements pursuant
to Section 14 of the Exchange Act.
(d) The Company will use its best efforts to qualify the Notes for
sale under the securities laws of such jurisdictions as the Agent reasonably
designates, to maintain such qualifications in effect so long as required for
the distribution of the Notes and, if requested by the Agent, to arrange for the
determination of the legality of the Notes for purchase by institutional
investors, except that the Company shall not be required in connection therewith
to qualify to do business in any jurisdiction where it is not now so qualified
or to take any action which would subject it to general or unlimited service of
process in any jurisdiction where it is not now so subject.
(e) The Company will furnish to the Agent copies of the Registration
Statement and the Prospectus (including all documents incorporated by reference
therein), and all amendments of and supplements to the Registration Statement or
the Prospectus which are filed with the Commission during the period in which a
prospectus relating to the Notes is required to be delivered under the Act
(including all documents filed by an amendment or supplement with the Commission
during such period which are deemed to be incorporated by reference therein), in
each case in such quantities as the Agent may from time to time reasonably
request.
(f) The Company will make generally available to its security
holders and to the Agent as soon as practicable, but in any event not later than
15 months after the end of the Company's current fiscal quarter, an earnings
statement (which need not be audited) covering a 12-month period beginning after
the date upon which any amendment of or supplement to the Prospectus (other than
a Pricing Supplement or an amendment or supplement relating solely to an
offering of debt securities other than the Notes) is filed pursuant to Rule 424
under the Act, which shall satisfy the provisions of Section 11(a) of the Act.
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(g) The Company shall, whether or not any sale of Notes is
consummated or this Agreement is terminated, pay all expenses incident to the
performance of its obligations under this Agreement and under any Terms
Agreement, including, without limitation, the fees and disbursements of its
accountants and counsel, the cost of printing (or other production) and delivery
of the Registration Statement and the Prospectus, all amendments thereof and
supplements thereto, the Indentures, and all other documents relating to the
offering, the cost of preparing, printing, packaging and delivering the Notes,
the fees and disbursements (including reasonable fees of counsel) incurred in
connection with the qualification of the Notes for sale and determination of
eligibility for investment of the Notes under the securities or Blue Sky laws of
such jurisdictions as the Agent may designate, the fees and disbursements of the
Trustees, the fees of any agency that rates the Notes, the fees and expenses in
connection with any listing of the Notes on the New York Stock Exchange, Inc.
(the "New York Stock Exchange") or such other securities exchange agreed to in
writing by the Company, the fees and expenses incurred with respect to any
filing with the National Association of Securities Dealers, Inc. and the
reasonable fees and disbursements of Xxxxx Xxxxxxxxxx LLP ("Xxxxx Xxxxxxxxxx"),
as counsel for the Agent, or other counsel reasonably satisfactory to both the
Agent and the Company, and such other expenses, including, without limitation,
advertising expenses as may be agreed upon by the Agent and the Company;
provided, however, that with respect to any purchase of Notes by the Agent as
principal pursuant to a Terms Agreement, the fees and disbursements of Xxxxx
Xxxxxxxxxx or other counsel to the Agent relating to such purchase shall be
paid by the Agent and shall not be paid by the Company.
(h) During the term of this Agreement, the Company shall furnish to
the Agent such relevant documents and certificates of officers of the Company
relating to the business, operations and affairs of the Company, the
Registration Statement, the Prospectus, any amendments thereof or supplements
thereto, the Indentures, the Notes, this Agreement, the Procedures, any Terms
Agreement and the performance by the Company of its obligations hereunder or
thereunder as the Agent may from time to time reasonably request and shall
promptly notify the Agent orally, followed by written notice of any downgrading,
or of its receipt of any notice of any intended downgrading, in the rating
accorded any of the Company's securities by Xxxxx'x Investor Service ("Moody's")
or Standard & Poor's Corporation ("Standard & Poor's") or, if one of them no
longer rates the securities of the Company, another "nationally recognized
statistical rating organization," as such term is defined for purposes of Rule
436(g)(2) under the Act.
(i) Each time the Registration Statement or the Prospectus is
amended or supplemented (other than (a) a Pricing Supplement, (b) an amendment
or supplement relating solely to an offering of debt securities other than the
Notes or (c) an amendment or supplement made pursuant to the incorporation by
reference of a document filed under the Exchange Act), the Company will deliver
or cause to be delivered forthwith to the Agent a certificate of the Company
signed by the Chairman of the Board, any Vice Chairman, the Chief Financial
Officer, the Chief Accounting Officer, the Treasurer, Deputy Treasurer, any
Assistant Treasurer, or the Deputy General Counsel and by the Controller or the
principal financial or accounting officer of the Company (or another officer or
officers acceptable to the Agent), dated the date of the effectiveness of such
amendment or the date of filing with the Commission of such supplement or
document,
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as the case may be, in form reasonably satisfactory to the Agent, to the effect
that the statements contained in the certificate referred to in Section
4(b)(iii) hereof that was last furnished to the Agent (either pursuant to
Section 4(b)(iii) or pursuant to this Section 3(i)) are true and correct at the
time of the effectiveness of such amendment or the time of filing of such
supplement or document, as the case may be, as though made at and as of such
time (except that such statements shall be deemed to relate to the Registration
Statement, as amended at the time of effectiveness of such amendment, and to the
Prospectus, as amended and supplemented at the date of such certificate) or, in
lieu of such certificate, a certificate of the same tenor as the certificate
referred to in Section 4(b)(iii) hereof, but modified, if necessary, to relate
to the Registration Statement, as amended at the time of the effectiveness of
such amendment, and to the Prospectus, as amended and supplemented at the date
of such certificate.
(j) Each time the Registration Statement or the Prospectus is
amended or supplemented (other than (a) a Pricing Supplement, (b) an amendment
or supplement relating solely to an offering of debt securities other than the
Notes or (c) an amendment or supplement made pursuant to the incorporation by
reference of a document under the Exchange Act), the Company shall furnish to or
cause to be furnished forthwith to the Agent the written opinion of the Deputy
General Counsel or an Associate General Counsel of the Company or other counsel
reasonably satisfactory to the Agent dated the date of the effectiveness of such
amendment or the date of filing with the Commission of such supplement or
document, as the case may be, in form reasonably satisfactory to the Agent, to
the effect set forth in Exhibit C hereto. In lieu of such opinion, counsel last
furnishing such an opinion to the Agent may furnish to the Agent a letter to the
effect that the Agent may rely on such last opinion to the same extent as though
it were dated the date of such letter and authorizing reliance on such last
opinion (except that statements in such last opinion will be deemed to relate to
the Registration Statement, as amended at the time of the effectiveness of such
amendment, and to the Prospectus, as amended and supplemented at the date of
such letter).
(k) Each time that the Registration Statement or the Prospectus is
amended or supplemented to set forth amended or supplemental financial
information (other than (a) a Pricing Supplement, (b) any amendment or
supplement relating solely to an offering of debt securities other than the
Notes or (c) an amendment or supplement made pursuant to the incorporation by
reference of a document under the Exchange Act), the Company shall cause KPMG
LLP ("KPMG"), its independent certified public accountants, to furnish forthwith
the Agent a letter, within three business days following the date of the
effectiveness of such amendment or the date of filing of such supplement or
document, as the case may be (provided that, in the event any Settlement Date
falls within such three business day period, such letter will be delivered on or
prior to such Settlement Date), in form satisfactory to the Agent, of the same
tenor as the letter referred to in Section 4(b)(iv) hereof, but modified to
relate to the Registration Statement and Prospectus, as amended and supplemented
to the date of such letter, with such changes as may be necessary to reflect
changes in the financial statements and other information derived from the
accounting records of the Company; provided, that, if the Registration Statement
or the Prospectus is amended or supplemented solely to include or incorporate by
reference financial information with respect to a fiscal quarter, KPMG may limit
the
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scope of such letter to the unaudited financial statements included in such
amendment or supplement.
(l) Each acceptance by the Company of an offer for the purchase of
Notes and each sale of Notes to the Agent as principal shall be deemed to be an
affirmation that the representations and warranties of the Company contained in
or made pursuant to this Agreement are true and correct in all material respects
at the time of such acceptance or sale, as the case may be, as though made at
and as of such time, and an undertaking that such representations and warranties
will be true and correct in all material respects at the time of delivery to the
purchaser or his agent, or the Agent, or the Agent as principal, of the Notes
relating to such acceptance, as the case may be, as though made at and as of
such time (and it is understood that such representations and warranties shall
relate to the Registration Statement and the Prospectus as amended and
supplemented to each such time).
(m) Anything to the contrary in this Section 3 notwithstanding, if,
at the time of any required notice, amendment or supplement to the Registration
Statement or the Prospectus, the Company shall have instructed the Agent to
suspend solicitation of offers to purchase the Notes in its capacity as Agent of
the Company and the Agent does not then hold any Notes acquired by it as
principal pursuant to a Terms Agreement, the Company shall not be obligated to
furnish or cause to be furnished to the Agent any notice, certificate, opinion
or letter otherwise required until such time as it shall determine that
solicitation of offers to purchase the Notes should be resumed; and provided
further that, prior to resuming such solicitation the Agent shall be entitled to
receive any such notices, certificates, opinions or letters not previously
furnished, accurate as of the date of such notice, certificate, opinion or
letter.
4. Conditions to the Obligations of the Agent. The Agent's obligations to
solicit offers to purchase Notes as agent of the Company, the Agent's
obligations to purchase Notes as principal pursuant to any Terms Agreement or
otherwise and the obligation of any other purchaser to purchase Notes from the
Company will be subject to the accuracy in all material respects of the
representations and warranties on the part of the Company herein contained, to
the accuracy of the statements of the Company's officers made in each
certificate furnished pursuant to the provisions hereof and to the performance
and observance by the Company of all covenants and agreements herein contained
on its part to be performed and observed (in the case of the Agent's obligations
to solicit offers to purchase Notes, at the time of such solicitation, and, in
the case of the Agent's or any other purchaser's obligation to purchase Notes,
at the time the Company accepts the offer to purchase such Notes and at the time
of purchase) and (in each case) to the following additional conditions precedent
when and as specified:
(a) On the corresponding Settlement Date:
(i) There shall not have occurred any change in or affecting
particularly the business or properties of the Company and its
subsidiaries from that set forth in the Registration Statement, as amended
or supplemented, that, in the Agent's judgment, makes it impracticable to
market the Notes on the terms and
11
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in the manner contemplated in the Prospectus except, in the case of any
purchase of Notes by the Agent as principal, as disclosed to the Agent in
writing by the Company before it accepted the offer to purchase such
Notes.
(ii) There shall not have occurred any (A) suspension or
material limitation of trading in securities generally on the New York
Stock Exchange, or any setting of minimum prices for trading on such
exchange, or any suspension of trading of any securities of the Company on
any exchange or in the over-the-counter market, (B) declaration of a
general moratorium on commercial banking activities in New York by either
federal or New York state authorities or (C) any outbreak or escalation of
major hostilities in which the United States is involved, any declaration
of war by Congress or any other substantial national or international
calamity or emergency that, in the Agent's judgment, is material and
adverse and, in the case of any of the events described in clauses (ii)(A)
through (C), such event makes it, in the Agent's judgment, impracticable
to market the Notes on the terms and in the manner contemplated by the
Prospectus, as amended or supplemented, except, in the case of any
purchase of Notes by the Agent as principal, for any such event occurring
before the Company accepted the offer to purchase such Notes.
(iii) There shall not have been any downgrading, nor any
notice given of any intended downgrading, in the rating accorded any of
the Company's securities by Xxxxx'x or Standard & Poor's or, if one of
them no longer rates the securities of the Company, another "nationally
recognized statistical rating organization," as such term is defined for
purposes of Rule 436(g)(2) under the Act, except, in the case of any
purchase of Notes by the Agent as principal, as disclosed to the Agent in
writing by the Company before it accepted the offer to purchase such
Notes.
(b) On the Commencement Date and, if called for by any agreement by
the Agent to purchase Notes as principal, on the corresponding Settlement Date:
(i) The Company shall have furnished to the Agent the opinion
of the Deputy General Counsel or an Associate General Counsel of the
Company (or other counsel for the Company reasonably acceptable to the
Agent) on the Commencement Date, and on the Settlement Date will furnish
the opinion of the Deputy General Counsel of the Company or an Associate
General Counsel of the Company (or other counsel for the Company
reasonably acceptable to the Agent) and, if called for by a Terms
Agreement, the opinion of other counsel, dated the Commencement Date or
the Settlement Date, as the case may be, to the effect set forth in
Exhibit C hereto.
(ii) The Agent shall have received from Xxxxx Xxxxxxxxxx (or
other counsel reasonably acceptable to the Agent and the Company), counsel
for the Agent, an opinion dated the Commencement Date or the Settlement
Date, as the case may be, to the effect set forth in Exhibit D hereto.
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(iii) The Company shall have furnished to the Agent a
certificate of the Company, signed by the Chairman of the Board, any Vice
Chairman, the Chief Financial Officer, the Chief Accounting Officer, the
Treasurer, the Deputy Treasurer, any Assistant Treasurer or the Deputy
General Counsel and by the Controller or the principal financial or
accounting officer of the Company (or another officer or officers
acceptable to the Agent), dated the Commencement Date or the Settlement
Date, as the case may be, to the effect that each signatory of such
certificate, to the best of his or her knowledge, after reasonable
investigation, certifies that:
(A) the representations and warranties of the Company in
this Agreement are true and correct in all material respects on and
as of the date of such certificate with the same effect as if made
on the date of such certificate and the Company has complied in all
material respects with all the agreements and satisfied in all
material respects all the conditions on its part to be performed or
satisfied as a condition to the obligations of the Agent under this
Agreement;
(B) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to their knowledge, have been
threatened; and
(C) since the date of the most recent financial
statements included in the Prospectus, as amended and supplemented,
there has been no material adverse change in the consolidated
financial condition or results of operations of the Company and its
subsidiaries, taken as a whole, which is not disclosed in the
Prospectus, as amended or supplemented.
(iv) KPMG, or another nationally recognized independent
accounting firm, shall have furnished to the Agent a letter or letters,
dated the Commencement Date or the Settlement Date, as the case may be, in
form and substance reasonably satisfactory to the Agent, to the effect set
forth in Exhibit E hereto.
(v) The Company shall have furnished to the Agent such
appropriate further information, certificates and documents as the Agent
may reasonably request.
5. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless the Agent against
any losses, claims, damages or liabilities, joint or several, to which the 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 the Registration Statement when it became
13
14
effective, the Prospectus, or any amendment or supplement thereto, or any
related Preliminary Prospectus, 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 the Agent for any legal or other expenses reasonably incurred by it in
connection with investigating or defending against such loss, claim, damage,
liability or action; 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 therein in reliance upon and in conformity
with written information furnished to the Company by or on behalf of the Agent
specifically for use in the preparation thereof and such indemnity with respect
to any preliminary prospectus, the Prospectus or any preliminary supplemental
prospectus, shall not inure to the benefit of the Agent (or any person
controlling the Agent) if the Company shall have delivered sufficient quantities
of the Prospectus, as amended and supplemented, to the Agent within a reasonable
time prior to the earlier of the delivery of the written confirmation of the
sale of such Notes or the delivery of such Notes to the person asserting such
loss, claim, damage, liability or action for which indemnification is sought,
and the Prospectus as so amended and supplemented (excluding documents
incorporated by reference) was not sent or given to such person by the Agent at
or prior to the earlier of the delivery of the written confirmation of the sale
of such Notes or the delivery of such Notes to such person in any case where
such sending or giving of a prospectus is required by the Act, and the untrue
statement or omission of a material fact contained in such preliminary
prospectus, such Prospectus or such preliminary supplemental prospectus, was
corrected in the Prospectus, as so amended and supplemented, provided to the
Agent.
(b) The 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
part of the Registration Statement when such part became effective, the
Prospectus or any amendment or supplement thereto, or any related Preliminary
Prospectus, 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 therein in reliance upon and in conformity
with written information furnished to the Company by or on behalf of the Agent
specifically for use in the preparation thereof, and will reimburse the Company
for any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending against any such loss, claim, damage, liability
or action.
(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
14
15
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 in and, to the extent that it shall wish, 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
indemnified party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
subsection for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation.
(d) If the indemnification provided for in this Section 5 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then the indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above, (i)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Agent participating in the offering that
gave rise to such losses, claims, damages or liabilities on the other from the
offering of such Notes, or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of the Company on the one hand and the Agent on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Agent on the other in connection with the offering of such Notes shall
be deemed to be in the same proportion as the total net proceeds from the
offering of such Notes by the Agent (before deducting expenses) received by the
Company bear to the total commissions received by the Agent in respect thereof.
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or the Agent and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The Company and the Agent agree that it would not
be just and equitable if contributions pursuant to this subsection (d) were to
be determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to in the first
sentence of this subsection (d). The amount paid by an indemnified party as a
result of the losses, claims, damages or liabilities referred to in the first
sentence of this subsection (d) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim (which shall be limited as
provided in subsection (c) above if the indemnifying party has assumed the
defense of any such action in accordance with the provisions thereof) which is
the subject of this subsection (d). Notwithstanding the provisions of this
subsection (d), the Agent shall not be required to contribute any amount in
excess of the amount by which the total price at which the Notes were offered
and sold to the public by the Agent exceeds the amount of any damages which the
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
15
16
contribution from any person who was not guilty of such fraudulent
misrepresentation. Promptly after receipt by an indemnified party under this
subsection (d) of notice of the commencement of any action against such party in
respect of which a claim for contribution may be made against an indemnifying
party under this subsection (d), such indemnified party shall notify the
indemnifying party in writing of the commencement thereof if the notice
specified in subsection (c) above has not been given with respect to such
action; 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 this subsection (d).
(e) The obligations of the Company under this Section 5 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 the
Agent within the meaning of the Act or the Exchange Act; and the obligations of
the Agent under this Section 5 shall be in addition to any liability which the
Agent may otherwise have and shall extend, upon the same terms and conditions,
to each director of the Company, to each officer of the Company who has signed
the Registration Statement and to each person, if any, who controls the Company
within the meaning of the Act or the Exchange Act.
6. Termination of the Appointment of the Agent. This Agreement may be
terminated at any time by either party hereto upon the giving of written notice
of such termination to the other party hereto. The termination of this Agreement
shall not require termination of any agreement by the Agent to purchase Notes as
principal, and the termination of any such Agreement shall not require
termination of this Agreement. If this Agreement is terminated, neither party
shall have any liability to the other party hereto, except as provided in the
first sentence of the second paragraph of Section 1(a), the last proviso of
Section 3(b), and Sections 3(f), 3(g), 5, 7 and 11 hereof, and except that, if
at the time of termination an offer to purchase any of the Notes has been
accepted by the Company but the time of delivery to the purchaser or its agent
of the Note or Notes relating thereto has not occurred, the Company's
representations and warranties stated in Section 2 and its obligations under
Sections 1(c), 3(a), 3(b), 3(c), 3(e), 3(h), 3(i), 3(j), 3(k), 3(l) and 4 hereof
shall also remain in full force and effect and not be terminated until the
delivery of such Notes.
7. Representations and Indemnities to Survive. With respect to the Agent's
solicitation of offers to purchase Notes as agent of the Company or the Agent's
obligation to purchase Notes as principal pursuant to any Terms Agreement or
otherwise, the respective agreements, representations, warranties, indemnities
and other statements of the Company or its officers and of the Agent set forth
in or made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation made by or on behalf of the Agent or the Company
or any of the officers, directors or controlling persons referred to in Section
5 hereof, and will survive delivery of and payment for the Notes for a period
extending to the earlier of (i) three years from the corresponding Settlement
Date for such Notes or (ii) the expiration of any applicable statute of
limitations governing such solicitation or purchase of Notes.
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8. Notices. All communications hereunder will be in writing and effective
only on receipt, and, if sent to the Agent, will be mailed, delivered or
transmitted to it by any standard form of telecommunications at:
Xxxxxxx Xxxxx Xxxxxx Inc.
0 Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Medium Term Note Department
Fax: (000) 000-0000
or, if sent to the Company, will be mailed, delivered or transmitted by any
standard form of telecommunications at:
Citigroup Inc.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Deputy Treasurer
Reference Medium-Term Note Program
Fax: (000) 000-0000
and
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Deputy General Counsel
Reference Medium-Term Note Program
Fax: (000) 000-0000
Any party to this Agreement may change the address to which notices or
communications to it shall be directed by giving notice in writing to the other
parties hereto.
9. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto and their respective successors and the officers and
directors and controlling persons referred to in Section 5 hereof. Nothing
expressed or implied in this Agreement or any Terms Agreement is intended or
shall be construed to give any person, firm or corporation, other than the
parties hereto and their respective successors and the controlling persons and
officers and directors referred to in Section 5 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any Terms Agreement or any provision herein or
therein contained. This Agreement and any Terms Agreement and all conditions and
provisions hereof and thereof, except to the extent provided for in Section 4
hereof, are intended to be for the sole and exclusive benefit of the parties
hereto and their respective successors and said controlling persons and officers
and directors and their heirs and legal representatives, and for the benefit of
no other person, firm or corporation. No purchaser of Notes shall be deemed to
be a successor by reason merely of such purchase. This Agreement and the rights
and obligations of the Agent hereunder may not be assigned without the prior
written consent of the Company.
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10. Waivers, Etc. Neither any failure nor delay on the part of any party
to exercise any right, remedy, power or privilege under this Agreement (singly
and collectively referred to as a "Right") shall operate as a waiver of such
Right, nor shall any single or partial exercise of any Right preclude any other
or further exercise of any Right, nor shall any waiver of any Right with respect
to any occurrence be construed as a waiver of any Right with respect to any
other occurrence.
11. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York.
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If the foregoing is in accordance with the Agent's understanding of
this agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and the Agent's acceptance shall represent a binding
agreement between the Company and the Agent.
Very truly yours,
CITIGROUP INC.
By /s/ Xxx X. Xxxxxxxxx
______________________________________
Name: Xxx X. Xxxxxxxxx
Title: Treasurer
The foregoing Agreement
is hereby confirmed and
accepted as of the date
first written above.
XXXXXXX XXXXX XXXXXX INC.
By /s/ Xxxxx X. Xxxxxxxxxxxx
_____________________________
Name: Xxxxx X. Xxxxxxxxxxxx
Title: Director
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Schedule 1
Citigroup Inc.
Medium-Term Notes
Commission Schedule
Unless it is agreed at the time of trade that an Issue of Notes will
be offered to retail investors, Citigroup agrees to pay each Selling Agent a
commission equal to the following percentage of the principal amount of Notes
sold to institutional purchasers solicited by such Selling Agent:
Commission Rate
(as a percentage of
Term principal amount)
---- -------------------
9 months to less than 1 year .125%
1 year to less than 18 months .15
18 months to less than 2 years .20
2 years to less than 3 years .25
3 years to less than 4 years .35
4 years to less than 5 years .45
5 years to less than 6 years .50
6 years to less than 7 years .55
7 years to less than 10 years .60
10 years to less than 15 years .625
15 years to less than 20 years .675
20 years to less than 30 years .75
30 years to less than 50 years .875
50 years to less than 60 years 1.00
Greater than 60 years to be negotiated
S 1-1
21
Exhibit A
CITIGROUP INC.
MEDIUM-TERM SENIOR NOTES, SERIES D
MEDIUM-TERM SUBORDINATED NOTES, SERIES D
DUE NINE MONTHS OR MORE FROM THE DATE OF ISSUE
TERMS AGREEMENT
Dated: , 2000
Citigroup Inc.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Deputy Treasurer
Re: Distribution Agreement dated December 14, 2000
(the "Distribution Agreement")
Subject to the terms and provisions stated below, the undersigned
agrees to purchase the following principal amount of your (check box):
[ ] Medium-Term Senior Notes, Series D, Due Nine Months or More
from the Date of Issue: $ ; and/or
[ ] Medium-Term Subordinated Notes, Series D, Due Nine Months or
More from the Date of Issue: $ .
For All Notes: For Fixed Rate Notes: For Floating Rate Notes:
-------------- --------------------- ------------------------
Purchase Price: Interest Rate: Base Rate:
Price to Public: Index Maturity:
A-1
22
For All Notes: For Fixed Rate Notes: For Floating Rate Notes:
-------------- --------------------- ------------------------
Settlement Date and time: Spread:
Place of delivery: Spread Multiplier:
Original Issue Date: Amortization
Schedule:
Date on which interest
begins to accrue (if
different from Original
Issue Date):
Specified Currency: Initial Interest Rate:
Maturity Date: Interest Reset Dates:
Interest Payment Dates: Maximum Interest Rate:
A-2
23
For All Notes: For Fixed Rate Notes: For Floating Rate Notes:
-------------- --------------------- ------------------------
Regular Record Dates:
Exchange Rate Agent:
Option to receive
payments in specified
currency other than U.S.
Dollars:
Sinking fund:
Total amount OID:
Original yield to Minimum Interest Rate:
maturity:
Renewal terms:
A-3
24
For All Notes: For Fixed Rate Notes: For Floating Rate Notes:
-------------- --------------------- ------------------------
Option to elect
repayment:
Optional Repayment Dates:
Optional Repayment
prices:
Optional Interest Rate
Reset:
Optional Reset Dates:
Optional extension of
maturity:
Length of extension
period:
A-4
25
For All Notes: For Fixed Rate Notes: For Floating Rate Notes:
-------------- --------------------- ------------------------
Number of extension
periods:
Final Maturity Date:
Depositary:
Optional Redemption Interest Reset Period:
Date(s):
Initial Redemption Date: Interest payment
Period:
Initial Redemption Calculation Agent:
Percentage:
Annual redemption
percentage decrease:
A-5
26
For All Notes: For Fixed Rate Notes: For Floating Rate Notes:
-------------- --------------------- ------------------------
Other terms:
The provisions of Sections 1(b) and (c) and 2 through 11 of the
Distribution Agreement and the related definitions are incorporated by reference
herein and shall be deemed to have the same force and effect as if set forth in
full herein.
Between the date of this Agreement and the Settlement Date with
respect to this Agreement, you will not, without the undersigned's prior
consent, offer, sell, contract to sell or otherwise dispose of any debt
securities of the Company substantially similar to the Medium-Term Senior Notes,
Series D, Due Nine Months or More from the Date of Issue and the Medium-Term
Subordinated Notes, Series D, Due Nine Months or More from the Date of Issue
(other than (i) the Notes to be sold pursuant to this Agreement and (ii)
commercial paper issued in the ordinary course of business), except as may
otherwise be provided herein.
The following information, opinions, certificates, letters and
documents referred to in Section 4 of the Distribution Agreement will be
required:
A-6
27
XXXXXXX XXXXX XXXXXX INC.
By ______________________________
Name:
Title:
Accepted:
CITIGROUP INC.
By________________________________
Name:
Title:
A-7
28
Exhibit B
CITIGROUP INC.
Medium-Term Notes Administrative Procedures
December 14, 2000
The Medium-Term Senior Notes, Series D, Due Nine Months or
More from the Date of Issue (the "Senior Notes") and the Medium-Term
Subordinated Notes, Series D, Due Nine Months or More from the Date of Issue
(the "Subordinated Notes" and, together with the Senior Notes, the "Notes") of
Citigroup Inc. (the "Company") are to be offered on a continuing basis. Xxxxxxx
Xxxxx Xxxxxx Inc. has agreed, as agent, to solicit purchases of the Notes issued
in fully registered form. (The term "Agent" when used in these Administrative
Procedures, means Xxxxxxx Xxxxx Xxxxxx Inc.). The Agent will not be obligated to
purchase Notes for its own account. The Notes are being sold pursuant to a
Distribution Agreement between the Company and the agents named therein
(including the Agent) dated the date hereof (the "Distribution Agreement"). The
Notes have been registered with the Securities and Exchange Commission (the
"Commission"). The Bank of New York ("BONY") is the trustee under the Indenture,
dated as of March 15, 1987, as amended from time to time, under which the Senior
Notes will be issued (the "Senior Debt Indenture"). Bank One Trust Company, N.A.
(as successor in interest to The First National Bank of Chicago) ("Bank One") is
the trustee (together with XXXX, the "Trustees") under the Indenture, dated as
of July 17, 1998, as amended from time to time, under which the Subordinated
Notes will be issued (the "Subordinated Debt Indenture" and, together with the
Senior Debt Indenture, the "Indentures"). The Senior Notes will constitute part
of the senior debt of the Company and will rank equally with all other unsecured
and unsubordinated debt of the Company. The Subordinated Notes will be
subordinate and junior in the right of payment to all Senior Indebtedness of the
Company, to the extent and in the manner set forth in the Subordinated Debt
Indenture.
The Distribution Agreement provides that Notes may also be
purchased by the Agent acting solely as principal and not as agent. In the event
of any such purchase, the functions of both the Agent and the beneficial owner
under the administrative procedures set forth below shall be performed by the
Agent acting solely as principal, unless otherwise agreed to between the Company
and the Agent acting as principal.
Each Note will be represented by either a Global Security (as
defined hereinafter) or a certificate delivered to the Holder thereof or a
Person designated by such Holder (a "Certificated Note"). Each Global Security
representing Senior Notes will be delivered to BONY, and each Global Security
representing Subordinated Notes will be delivered to Bank One, each acting as
agent for The Depository Trust
B-1
29
Company or any successor depository selected by the Company ("DTC," which term,
as used herein, includes any successor depository selected by the Company), and
will be recorded in the book-entry system maintained by DTC (a "Book-Entry
Note"). An owner of a Book-Entry Note will not be entitled to receive a
certificate representing such Note.
The procedures to be followed during, and the specific terms
of, the solicitation of orders by the Agent and the sale as a result thereof by
the Company are explained below. Administrative and record-keeping
responsibilities will be handled for the Company by its Treasury Department. The
Company will advise the Agent and the Trustees in writing of those persons
handling administrative responsibilities with whom the Agent and the Trustees
are to communicate regarding orders to purchase Notes and the details of their
delivery.
Administrative procedures and specific terms of the offering
are explained below. Book-Entry Notes will be issued in accordance with the
administrative procedures set forth in Part I hereof, as adjusted in accordance
with changes in DTC's operating requirements, and Certificated Notes will be
issued in accordance with the administrative procedures set forth in Part II
hereof. Unless otherwise defined herein, terms defined in the Indentures, the
Notes or the Prospectus Supplement relating to the Notes shall be used herein as
therein defined. Notes for which interest is calculated on the basis of a fixed
interest rate, which may be zero, are referred to herein as "Fixed Rate Notes."
Notes for which interest is calculated on the basis of a floating interest rate
are referred to herein as "Floating Rate Notes." The Company will appoint and
enter into agreements with agents (each a "Calculation Agent") to calculate
interest rates on Floating Rate Notes. Unless otherwise specified in a Pricing
Supplement, BONY will be the Calculation Agent for each Senior Note that is a
Floating Rate Note and Bank One will be the Calculation Agent for each
Subordinated Note that is a Floating Rate Note. To the extent the procedures set
forth below conflict with the provisions of the Notes, the Indentures, DTC's
operating requirements or the Distribution Agreement, the relevant provisions of
the Notes, the Indentures, DTC's operating requirements and the Distribution
Agreement shall control. The Company may, at its option, appoint Citibank, N.A.
to act as paying agent.
PART I
Administrative Procedures for
Book-Entry Notes
In connection with the qualification of the Book-Entry Notes
for eligibility in the book-entry system maintained by DTC, BONY and Bank One
(together, the "DTC Agents") will perform the custodial, document control and
administrative functions described below for the Senior Notes and the
Subordinated Notes, respectively. BONY will perform such functions in accordance
with its respective obligations under a Letter of Representations from the
Company and
B-2
30
BONY to DTC dated as of the date hereof and a Medium-Term Note Certificate
Agreement between BONY and DTC, dated as of August 17, 1989 and as amended to
date, and its obligations as a participant in DTC, including DTC's Same-Day
Funds Settlement system ("SDFS"). Bank One will perform such functions in
accordance with its respective obligations under a Letter of Representations
from the Company and Bank One to DTC dated as of the date hereof and a
Medium-Term Note Certificate Agreement between DTC and Bank One, dated as of
May 26, 1989, and as amended to date, and its obligations as a participant in
DTC, including DTC's SDFS.
Issuance: On any date of settlement (as
defined under "Settlement" below)
for one or more Book-Entry Notes,
the Company will issue a single
global security in fully registered
form without coupons (a "Global
Security") representing up to
$400,000,000 principal amount of all
such Book-Entry Notes of the same
Series that have the same Original
Issue Date, Original Issue Discount
provisions, if any, Interest Payment
Dates, Regular Record Dates,
Interest Payment Period, redemption,
repayment and extension provisions,
if any, Stated Maturity, and, in the
case of Fixed Rate Notes, interest
rate, and amortization schedule, if
any, or, in the case of Floating
Rate Notes, Initial Interest Rate,
Base Rate, Index Maturity, Interest
Reset Period, Interest Reset Dates,
Spread and/or Spread Multiplier, if
any, Minimum Interest Rate, if any,
and Maximum Interest Rate, if any
and, in each case, any other
relevant terms (collectively, the
"Terms"). Each Global Security will
be dated and issued as of the date
of its settlement. Each Global
Security will bear an Original Issue
Date, which will be (i) with respect
to an original Global Security (or
any portion thereof), the Original
Issue Date specified in such Global
Security and (ii) following a
consolidation of Global Securities,
with respect to the Global Security
resulting from such consolidation,
the most recent Interest Payment
Date to which interest has been paid
or duly provided for on the
predecessor Global Securities,
regardless of the date of
authentication of such resulting
Global Security. No Global Security
will represent (i) both Fixed Rate
and Floating Rate Book-Entry Notes
or (ii) any Certificated Note or
(iii) both Senior Notes and
Subordinated Notes.
B-3
31
Identification Numbers: The Company has arranged with the
CUSIP Service Bureau of Standard &
Poor's Corporation (the "CUSIP
Service Bureau") for the reservation
of two series of CUSIP numbers, one
for Senior Notes and one for
Subordinated Notes, each of which
series consists of approximately 900
CUSIP numbers and relates to Global
Securities representing Book-Entry
Notes and book-entry medium-term
notes issued by the Company with
other Series designations. The DTC
Agents, the Company and DTC have
obtained from the CUSIP Service
Bureau a written list of such
reserved CUSIP numbers. The DTC
Agents will assign CUSIP numbers to
Global Securities as described below
under Settlement Procedure "B." DTC
will notify the CUSIP Service Bureau
periodically of the CUSIP numbers
that the DTC Agents have assigned to
Global Securities. Each DTC Agent
will notify the Company at any time
when fewer than 100 of the reserved
CUSIP numbers remain unassigned to
Global Securities, and, if it deems
necessary, the Company will reserve
additional CUSIP numbers for
assignment to Global Securities.
Upon obtaining such additional CUSIP
numbers, the Company shall deliver a
list of such additional CUSIP
numbers to either or both DTC
Agents, as needed, and to DTC.
Registration: Global Securities will be issued
only in fully registered form
without coupons. Each Global
Security will be registered in the
name of CEDE & CO., as nominee for
DTC, on the securities register for
the Notes (the "Securities
Register") maintained under the
applicable Indenture. The beneficial
owner of a Book-Entry Note (or one
or more indirect participants in DTC
designated by such owner) will
designate one or more participants
in DTC (with respect to such
Book-Entry Note, the "Participants")
to act as agent or agents for such
owner in connection with the
book-entry system maintained by DTC,
and DTC will record in book-entry
form, in accordance with instruc-
B-4
32
tions provided by such Participants,
a credit balance with respect to
such beneficial owner in such
Book-Entry Note in the account of
such Participants. The ownership
interest of such beneficial owner
(or such participant) in such
Book-Entry Note will be recorded
through the records of such
Participants or through the separate
records of such Participants and one
or more indirect participants in
DTC.
Transfers: Transfers of a Book-Entry Note will
be accomplished by book entries made
by DTC and, in turn, by Participants
(and in certain cases, one or more
indirect participants in DTC) acting
on behalf of beneficial transferors
and transferees of such Note.
Exchanges: Each DTC Agent may deliver to DTC
and the CUSIP Service Bureau at any
time a written notice of
consolidation (a copy of which shall
be attached to the resulting Global
Security described below) specifying
(i) the CUSIP numbers of two or more
outstanding Global Securities that
represent (A) Fixed Rate Book-Entry
Notes of the same Series and having
the same Terms and for which
interest has been paid to the same
date or (B) Floating Rate Book-Entry
Notes of the same Series and having
the same Terms and for which
interest has been paid to the same
date, (ii) a date, occurring at
least thirty days after such written
notice is delivered and at least
thirty days before the next Interest
Payment Date for such Book-Entry
Notes, on which such Global
Securities shall be exchanged for a
single replacement Global Security
and (iii) a new CUSIP number to be
assigned to such replacement Global
Security. Upon receipt of such a
notice, DTC will send to its
participants (including the DTC
Agent for such replacement Global
Security) a written reorganization
notice to the effect that such
exchange will occur on such date.
Prior to the specified exchange
date, such DTC Agent will deliver to
the CUSIP Service Bureau a written
notice setting forth such exchange
date and such new CUSIP number and
stating that, as of such exchange
date, the CUSIP numbers of the
B-5
33
Global Securities to be exchanged
will no longer be valid. On the
specified exchange date, such DTC
Agent will exchange such Global
Securities for a single Global
Security bearing the new CUSIP
number and a new Original Issue
Date, which shall be the last date
to which interest has been paid on
the underlying Book-Entry Notes, and
the CUSIP numbers of the exchanged
Global Securities will, in
accordance with CUSIP Service Bureau
procedures, be canceled and not
immediately reassigned. Upon such
exchange, the DTC Agent will mark
the predecessor Global Security
"canceled," make appropriate entries
in the DTC Agent's records and
destroy such canceled Global
Security in accordance with the
terms of the applicable Indenture
and deliver a certificate of
destruction to the Company.
Notwithstanding the foregoing, if
the Global Securities to be
exchanged exceed $400,000,000 in
aggregate principal amount, one
Global Security will be
authenticated and issued to
represent each $400,000,000 of
principal amount of the exchanged
Global Securities and an additional
Global Security will be
authenticated and issued to
represent any remaining principal
amount of such Global Securities
(see "Denominations" below).
Maturities: Each Book-Entry Note will mature on
a date nine months or more after the
issue date for such Note. A Floating
Rate Book-Entry Note will mature
only on an Interest Payment Date for
such Note.
Denominations: Book-Entry Notes will be issued in
principal amounts of $1,000 or any
amount in excess thereof that is an
integral multiple of $1,000. If
Book-Entry Notes are denominated in
a Specified Currency other than U.S.
dollars, the denominations of such
Notes will be determined pursuant to
the provisions of the applicable
Pricing Supplement. Global
Securities will be denominated in
principal amounts not in excess of
$400,000,000 (or the equivalent
thereof). If one or more Book-Entry
Notes having an aggregate principal
amount in excess of
B-6
34
$400,000,000 (or the equivalent
thereof) would, but for the
preceding sentence, be represented
by a single Global Security, then
one Global Security will be
authenticated and issued to
represent each $400,000,000
principal amount (or the equivalent
thereof) of such Book-Entry Note or
Notes and an additional Global
Security will be authenticated and
issued to represent any remaining
principal amount of such Book-Entry
Note or Notes. In such a case, each
of the Global Securities
representing such Book-Entry Note or
Notes shall be assigned the same
CUSIP number.
Notice of Redemption Dates: Each DTC Agent will, with respect to
the Notes for which it is the
Trustee, give notice to DTC prior to
each Redemption Date (as specified
in the Note) if any at the time and
in the manner set forth in the
applicable Letter of
Representations.
Interest: General. Unless otherwise indicated
in the applicable Pricing
Supplement, interest, if any, on
each Book-Entry Note will accrue
from the Original Issue Date (or
such other date on which interest
otherwise begins to accrue (if
different than the Original Issue
Date)) of the Global Security
representing such Book-Entry Note
for the first interest period or the
last date to which interest has been
paid, if any, for each subsequent
interest period, on the Global
Security representing such
Book-Entry Note, and will be
calculated and paid in the manner
and on the Interest Payment Dates
described in such Book-Entry Note
and in the Prospectus (as defined in
the Distribution Agreement), as
supplemented by the applicable
Pricing Supplement. Unless otherwise
specified, each payment of interest
on a Book-Entry Note will include
interest accrued to but excluding
the Interest Payment Date; provided,
that in the case of Floating Rate
Notes that reset daily or weekly,
interest payments will include
interest accrued to but excluding
the next preceding Regular Record
Date, except that at stated
Maturity, the interest payable will
include interest accrued to, but
excluding, the Maturity. Interest
payable at
B-7
35
the Maturity of a Book-Entry Note
will be payable to the Person to
whom the principal of such Note is
payable. Standard & Poor's
Corporation will use the information
received in the pending deposit
message described under Settlement
Procedure "C" below in order to
include the amount of any interest
payable and certain other
information regarding the related
Global Security in the appropriate
(daily or weekly) bond report
published by Standard & Poor's
Corporation.
Regular Record Dates. The Regular
Record Date with respect to any
Interest Payment Date for a Floating
Rate Note, Fixed Rate Note or
Indexed Rate Note shall be the date
(whether or not a Business Day)
fifteen calendar days immediately
preceding such Interest Payment
Date.
Payments of Principal and Interest: Payment of Interest Only. Promptly
after each Regular Record Date, the
DTC Agent for each Global Security
will deliver to the Company and DTC
a written notice setting forth, by
CUSIP number, the amount of interest
to be paid on each Global Security
on the following Interest Payment
Date (other than an Interest Payment
Date coinciding with Maturity) and
the total of such amounts. DTC will
confirm the amount payable on each
Global Security on such Interest
Payment Date by reference to the
appropriate (daily or weekly) bond
reports published by Standard &
Poor's Corporation. The Company will
pay to the Trustee for the Notes
represented by such Global Security
the total amount of interest due on
such Interest Payment Date (other
than at Maturity), and such Trustee
will pay such amount to DTC, at the
times and in the manner set forth
below under "Manner of Payment." If
any Interest Payment Date for a
Book-Entry Note is not a Business
Day, the payment due on such day
shall be made on the next succeeding
Business Day and no interest shall
accrue as a result of such delayed
payment. In the case of a Floating
Rate Note that is a LIBOR note or a
EURIBOR note (each as described in
the Pro-
B-8
36
spectus), if postponement to the
next business day would cause the
interest payment date to be in the
next succeeding calendar month, the
Interest Payment Date will instead
be the immediately preceding
Business Day.
Payments at Maturity or Upon
Redemption. On or about the first
Business Day of each month, each DTC
Agent will, with respect to the
Global Securities for which it acts
as DTC Agent, deliver to the
Company, DTC and the applicable
Trustee a written list of principal
and interest to be paid on each
Global Security maturing either at
Maturity or on a Redemption Date in
the following month. The DTC Agent
for each Global Security, the
Company and DTC will confirm the
amounts of such principal and
interest payments with respect to
each such Global Security on or
about the fifth Business Day
preceding the Maturity Date or
Redemption Date of such Global
Security. On or before such Maturity
or Redemption, the Company will pay
to the Trustee for the Notes
represented by such Global Security
the principal amount or redemption
price of such Global Security,
together with interest due at such
Maturity or redemption in the manner
set forth below under "Manner of
Payment." Such Trustee will pay such
amount to DTC at the times and in
the manner set forth below under
"Manner of Payment." If any Maturity
of a Global Security representing
Book-Entry Notes is not a Business
Day, the payment due on such day
shall be made on the next succeeding
Business Day and no interest shall
accrue on such payment for the
period from and after such Maturity
Date or Redemption Date. Promptly
after payment to DTC of the
principal and interest or redemption
price due on the Maturity Date or
Redemption Date of such Global
Security, the Trustee for such
Global Security will cancel and
destroy such Global Security in
accordance with the applicable
Indenture and, if requested, deliver
a certificate of destruction to the
Company.
Manner of Payment. The total amount
of any
B-9
37
principal and interest or redemption
price due on Global Securities on
any Interest Payment Date or at
Maturity or upon redemption or
repayment shall be paid by the
Company to the Trustee for the Notes
represented by such Global Security
in immediately available funds no
later than 9:30 A.M. (New York City
time) on such date. The Company will
make such payment on such Global
Securities by instructing such
Trustee to withdraw funds from an
account maintained by the Company
with the DTC Agent for the Notes
represented by such Global
Securities. The Company will confirm
any such instructions in writing to
such Trustee. Prior to 10 A.M. (New
York City time) on the date of
Maturity or as soon as possible
thereafter, such Trustee will pay by
separate wire transfer (using
Fedwire message entry instructions
in a form previously specified by
DTC) to an account at the Federal
Reserve previously specified by DTC,
in funds available for immediate use
by DTC, each payment of principal
(together with interest thereon) due
on a Global Security on such
Maturity Date or Redemption Date. On
each Interest Payment Date (other
than at Maturity), interest payments
shall be made to DTC, in same day
funds, in accordance with existing
arrangements between the relevant
DTC Agent and DTC. On each such
date, DTC will pay, in accordance
with its SDFS operating procedures
then in effect, such amounts in
funds available for immediate use to
the respective Participants in whose
names the Book-Entry Notes
represented by such Global
Securities are recorded in the
book-entry system maintained by DTC.
None of the Company (as issuer or as
paying agent), the Trustee or such
DTC Agent shall have any direct
responsibility or liability for the
payment by DTC to such Participants
of the principal of and interest on
the Book-Entry Notes.
If an issue of Notes is denominated
in a currency other than the U.S.
dollar, the Company will make
payments of principal and any
interest in the currency in which
the Notes are de-
B-10
38
nominated (the "foreign currency")
or in U.S. dollars. DTC has elected
to have all such payments of
principal and interest in U.S.
dollars unless notified by any of
its Participants through which an
interest in the Notes is held that
it elects, in accordance with and to
the extent permitted by the
applicable Pricing Supplement and
the Note, to receive such payment of
principal or interest in the foreign
currency. On or prior to the third
Business Day after the record date
for payment of interest and twelve
days prior to the date for payment
of principal, such Participant shall
notify DTC of (i) its election to
receive all, or the specified
portion, of such payment in the
foreign currency and (ii) its
instructions for wire transfer of
such payment to a foreign currency
account.
DTC will notify the applicable
Trustee on or prior to the fifth
Business Day after the record date
for payment of interest and ten days
prior to the date for payment of
principal of the portion of such
payment to be received in the
foreign currency and the applicable
wire transfer instructions, and the
applicable Trustee shall use such
instructions to pay the Participants
directly. If DTC does not so notify
the applicable Trustee, it is
understood that only U.S. dollar
payments are to be made. The
applicable Trustee shall notify DTC
on or prior to the second Business
Day prior to payment date of the
conversion rate to be used and the
resulting U.S. dollar amount to be
paid per $1,000 face amount. In the
event that the applicable Trustee's
quotation to convert the foreign
currency into U.S. dollars is not
available, the applicable Trustee
shall notify DTC's Dividend
Department that the entire payment
is to be made in the foreign
currency. In such event, DTC will
ask its Participants for payment
instructions and forward such
instructions to the applicable
Trustee and the applicable Trustee
shall use such instructions to pay
the Participants directly.
Withholding Taxes. The amount of any
taxes
B-11
39
required under applicable law to be
withheld from any interest or
principal or redemption payment on a
Book-Entry Note will be determined
and withheld by the Participant,
indirect participant in DTC or other
Person responsible for forwarding
payments and materials directly to
the beneficial owner of such Note.
Procedures upon Company's Company Notice to Trustee regarding
Exercise of Optional Reset or Exercise of Optional Reset. Not less
Optional Extension of Maturity: than 45 or more than 60 days before
an Optional Reset Date as set forth
in a Book-Entry Note, the Company
will notify the Trustee for such
Book-Entry Note whether it is
exercising its option to reset the
interest rate or Spread or Spread
Multiplier, as the case may be, for
such Book-Entry Note, and if so, (i)
the new interest rate or Spread or
Spread Multiplier, as the case may
be, for such Book-Entry Note during
the period from such Optional Reset
Date to the next Optional Reset Date
as set forth in such Book-Entry Note
or, if there is no such next
Optional Reset Date, to the Stated
Maturity of such Book-Entry Note
(the "Subsequent Interest Period");
and (ii) the provisions, if any, for
redemption of such Book-Entry Note
during such Subsequent Interest
Period, including the date or dates
on which or the period or periods
during which such redemption may
occur during such Subsequent
Interest Period.
Company Notice to Trustee regarding
Exercise of Optional Extension of
Maturity. If the Company elects to
exercise an option, as set forth in
a Book-Entry Note, to extend the
Stated Maturity of such Note, it
will so notify the Trustee for such
Book-Entry Note no less than 45 or
more than 60 days before the Stated
Maturity of such Book-Entry Note,
and will further indicate (i) the
new Stated Maturity; (ii) the
interest rate or Spread or Spread
Multiplier, as the case may be,
applicable to the extension period;
and (iii) the provisions, if any,
for redemption of such Book-Entry
Note during such extension period,
including the date or dates on which
or the period or periods
B-12
40
during which such redemption may
occur during such extension period.
Trustee Notice to DTC regarding
Company's Exercise of Optional
Extension or Reset. Upon receipt of
notice from the Company regarding
the Company's exercise of either an
optional extension of maturity or an
optional reset, the Trustee for the
Book-Entry Note will deliver a
notice to DTC not less than 40 days
before the Optional Reset Date (in
which case a "Reset Notice") or the
Stated Maturity (in which case an
"Extension Notice"), as the case may
be, which Reset Notice or Extension
Notice shall identify such
Book-Entry Note by CUSIP number and
shall contain the information
required by the terms of the
Book-Entry Note.
Trustee Notice to Company regarding
Option to be Repaid. If, after
receipt of either a Reset Notice or
an Extension Notice, DTC exercises
the option for repayment by
tendering the Global Security
representing the Book-Entry Note to
be repaid as set forth in such Note,
the Trustee for such Book-Entry Note
shall give notice to the Company not
less than 22 days before the
Optional Reset Date or the old
Stated Maturity, as the case may be,
of the principal amount of
Book-Entry Notes to be repaid on
such Optional Reset Date or old
Stated Maturity, as the case may be.
Company Notice regarding New
Interest Rate or New Spread or
Spread Multiplier. If the Company
elects to revoke the interest rate
or Spread or Spread Multiplier
provided for in the Reset Notice and
establish a higher interest rate or
Spread or Spread Multiplier for an
Optional Reset Period or extension
period, as the case may be, it
shall, not less than 20 days before
such Optional Reset Date or old
Stated Maturity, so notify the
Trustee for the affected Book-Entry
Note. The Trustee will immediately
thereafter notify DTC of the new
interest rate or Spread or Spread
Multiplier applicable to such
Book-Entry Note.
B-13
41
Trustee Notice to Company regarding
DTC Revocation of Option to be
Repaid. If, after DTC has tendered
any Book-Entry Notes for repayment
pursuant to an Extension Notice or
an Reset Notice, DTC then revokes
such tender for repayment, the
Trustee for such Book-Entry Notes
shall give notice to the Company not
less than five days prior to the
Stated Maturity or Optional Reset
Date, as the case may be, of such
revocation and of the principal
amount of Book-Entry Notes for which
tender for repayment has been
revoked.
Deposit of Repayment Price. On or
before any old Stated Maturity where
the Maturity has been extended, and
on or before any Optional Reset
Date, the Company shall deposit with
such Trustee an amount of money
sufficient to pay the principal
amount, plus interest accrued to
such old Stated Maturity or Optional
Reset Date, as the case may be, for
all the Book-Entry Notes or portions
thereof for which such Trustee
serves as Trustee and which are to
be repaid on such old Stated
Maturity or Optional Reset Date, as
the case may be. Such Trustee will
use such money to repay such
Book-Entry Notes pursuant to the
terms set forth in such Notes.
Procedures upon Company Notice to Trustee regarding
Company's Exercise Exercise of Optional Redemption. At
of Optional least 45 days prior to the date on
Redemption: which it intends to redeem a
Book-Entry Note, the Company will
notify the Trustee for such
Book-Entry Note that it is
exercising such option with respect
to such Book-Entry Note on such date
and the redemption price of such
Book-Entry Notes.
Trustee Notice to DTC regarding
Company's Exercise of Optional
Redemption. After receipt of notice
that the Company is exercising its
option to redeem a Book-Entry Note,
the Trustee will, at least 30 days
before the Redemption Date for such
Book-Entry Note, hand deliver to DTC
a notice identifying such Book-Entry
Note by CUSIP number and informing
DTC of the Company's exercise of
B-14
42
such option with respect to such
Book-Entry Note.
Deposit of Redemption Price. On or
before any Redemption Date, the
Company shall deposit with such
Trustee an amount of money
sufficient to pay the redemption
price, plus interest accrued to such
Redemption Date, for all the
Book-Entry Notes or portions thereof
for which such Trustee serves as
Trustee and which are to be repaid
on such Redemption Date. Such
Trustee will use such money to repay
such Book-Entry Notes pursuant to
the terms set forth in such Notes.
Payments of Principal Trustee Notice to Company of Option
and Interest Upon to be Repaid. Upon receipt of notice
Exercise of Optional of exercise of the option for
Repayment (Except repayment and the Global Securities
Pursuant to representing the Book-Entry Notes so
Company's Exercise to be repaid as set forth in such
of Optional Reset or Notes, the Trustee for such
Optional Extension): Book-Entry Notes shall (unless such
notice was received pursuant to the
Company's exercise of an optional
reset or an optional extension of
maturity, in each of which cases the
relevant procedures set forth above
are to be followed) give notice to
the Company not less than 20 days
prior to each Optional Repayment
Date of such Optional Repayment Date
and of the principal amount of
Book-Entry Notes to be repaid on
such Optional Repayment Date.
Deposit of Repayment Price. On or
prior to any Optional Repayment
Date, the Company shall deposit with
such Trustee an amount of money
sufficient to pay the optional
repayment price, and accrued
interest thereon to such date, of
all the Book-Entry Notes or portions
thereof which are to be repaid on
such date. Such Trustee will use
such money to repay such Book-Entry
Notes pursuant to the terms set
forth in such Notes.
Procedure for Rate The Company and the Agent will
Setting and Posting: discuss from time to time the
aggregate principal amount of, the
issuance price of, and the interest
rates to be borne by, Book-Entry
Notes that may be
B-15
43
sold as a result of the solicitation
of orders by the Agent. If the
Company decides to set prices of,
and rates borne by, any Book-Entry
Notes in respect of which the Agent
is to solicit orders (the setting of
such prices and rates to be referred
to herein as "posting") or if the
Company decides to change prices or
rates previously posted by it, it
will promptly advise the Agent of
the prices and rates to be posted.
Acceptance and Rejection of Orders: Unless otherwise instructed by the
Company, the Agent will advise the
Company promptly by telephone of all
orders to purchase Book-Entry Notes
received by the Agent, other than
those rejected by it in whole or in
part in the reasonable exercise of
its discretion. Unless otherwise
agreed by the Company and the Agent,
the Company has the right to accept
orders to purchase Book-Entry Notes
and may reject any such orders in
whole or in part.
Preparation of Pricing Supplement: If any order to purchase a
Book-Entry Note is accepted by or on
behalf of the Company, the Company
will prepare a pricing supplement (a
"Pricing Supplement") reflecting the
terms of such Book-Entry Note, will
file one copy thereof by electronic
submission with the Commission in
accordance with the applicable
paragraph of Rule 424(b) under the
Act, will deliver such number of
copies thereof to the Agent as the
Agent shall request and will, on the
Agent's behalf, file three copies of
such Pricing Supplement with the
National Association of Securities
Dealers, Inc. (the "NASD"). The
Agent will cause a Prospectus and
such Pricing Supplement to be
delivered to the purchaser of such
Book-Entry Note.
In each instance that a Pricing
Supplement is prepared, the Agent
will affix the Pricing Supplement to
Prospectuses prior to their use.
Outdated Pricing Supplements and the
Prospectuses to which they are
attached (other than those retained
for files), will be destroyed.
B-16
44
Copies of the appropriate number of
Pricing Supplements shall be
delivered to the Agent at the
following address by 11:00 A.M., New
York City time, on the Business Day
following the acceptance of an offer
by or on behalf of the Company: to
Xxxxxxx Xxxxx Xxxxxx Inc., 0 Xxxxx
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 (with a copy transmitted by
telecopy to (000) 000-0000,
Attention: Medium Term Note
Department).
Suspension of Subject to the Company's
Solicitation; representations, warranties and
Amendment or covenants contained in the
Supplement: Distribution Agreement, the Company
may instruct the Agent to suspend at
any time, for any period of time or
permanently, the solicitation of
orders to purchase Book-Entry Notes.
Upon receipt of such instructions,
the Agent will forthwith suspend
solicitation until such time as the
Company has advised it such
solicitation may be resumed.
In the event that at the time the
Company suspends solicitation of
purchases there shall be any orders
outstanding for settlement, the
Company will promptly advise the
Agent, the Trustees and the DTC
Agents whether such orders may be
settled and whether copies of the
Prospectus as in effect at the time
of the suspension, together with the
appropriate Pricing Supplement, may
be delivered in connection with the
settlement of such orders. The
Company will have the sole
responsibility for such decision and
for any arrangements that may be
made in the event that the Company
determines that such orders may not
be settled or that copies of such
Prospectus may not be so delivered.
Delivery of A copy of the Prospectus and a
Prospectus: Pricing Supplement relating to a
Book-Entry Note must accompany or
precede the earliest of any written
offer of such Book-Entry Note,
confirmation of the purchase of such
Book-Entry Note and payment for such
Book-Entry Note by its purchaser. If
notice of a change in the terms of
the Book-Entry Notes is received by
B-17
45
the Agent between the time an order
for a Book-Entry Note is placed and
the time written confirmation
thereof is sent by the Agent to a
customer or his agent, such
confirmation shall be accompanied by
a Prospectus and Pricing Supplement
setting forth the terms in effect
when the order was placed. The Agent
will deliver a Prospectus and
Pricing Supplement as herein
described with respect to each
Book-Entry Note sold by it. The
Company will make such delivery if
such Book-Entry Note is sold
directly by the Company to a
purchaser (other than the Agent).
Confirmation: For each order to purchase a
Book-Entry Note solicited by the
Agent and accepted by or on behalf
of the Company, the Agent will issue
a confirmation to the purchaser,
with a copy to the Company, setting
forth the details set forth above
and delivery and payment
instructions.
Settlement: The receipt by the Company of
immediately available funds in
payment for a Book-Entry Note and
the authentication and issuance of
the Global Security representing
such Book-Entry Note shall
constitute "settlement" with respect
to such Book-Entry Note, and the
date of such settlement, the
"Settlement Date." All orders
accepted by the Company will be
settled on the third Business Day
next succeeding the date of
acceptance pursuant to the timetable
for settlement set forth below
unless the Company and the purchaser
agree to settlement on another day
which shall be no earlier than the
Business Day next succeeding the
date of sale.
Settlement Settlement Procedures with regard to
Procedures: each Book-Entry Note sold by the
Company to or through the Agent,
except pursuant to a Terms
Agreement, shall be as follows:
A. The Agent will advise the
Company by telephone (or by
facsimile or other acceptable
written means) that such
B-18
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Note is a Book-Entry Note and
of the following settlement
information:
1. Principal or face amount.
2. Series.
3. Stated Maturity.
4. In the case of a Fixed Rate
Book-Entry Note, the interest rate
and reset, redemption, repayment and
extension provisions (if any) or, in
the case of a Floating Rate
Book-Entry Note, the Base Rate,
Initial Interest Rate (if known at
such time), Interest Reset Period,
Interest Reset Dates, Index
Maturity, Spread and/or Spread
Multiplier (if any), Minimum
Interest Rate (if any), Maximum
Interest Rate (if any) and reset,
redemption, repayment and extension
provisions (if any).
5. Interest Payment Dates and
the Interest Payment Period.
6. Amortization provisions, if
any.
7. Settlement date and Issue
Date, if different.
8. Specified currency.
9. Denominated currency,
Indexed Currency, Base Exchange
Rate, and the Determination Date, if
applicable.
10. Price.
11. Agent's commission,
determined as provided in the
Distribution Agreement.
12. Whether such Book-Entry
Note is an OID Note and, if so, the
total amount of OID, the yield to
maturity and the initial accrual
period OID.
13. Any other terms necessary
to describe the Book-Entry Note.
B-19
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(a) The Company will advise the
relevant DTC Agent by telephone
(confirmed in writing at any time on
the same date), written
telecommunication or electronic
transmission of the information set
forth in Settlement Procedure "A"
above. Each such communication by
the Company shall constitute a
representation and warranty by the
Company to the DTC Agent for such
Note, the Trustee for such Note and
the Agent that (i) such Note is
then, and at the time of issuance
and sale thereof will be, duly
authorized for issuance and sale by
the Company and (ii) such Note, and
the Global Security representing
such Note, will conform with the
terms of the Indenture for such
Note. The DTC Agent will then assign
a CUSIP number to the Global
Security representing such
Book-Entry Note and notify the Agent
and the Company by telephone
(confirmed in writing at any time on
the same date), written
telecommunication or electronic
transmission of such CUSIP number as
soon as practicable.
B. Such DTC Agent will enter a
pending deposit message
through DTC's Participant
Terminal System providing the
following settlement
information to DTC Standard &
Poor's Corporation,
Interactive Data Corporation,
the Agent and, upon request,
the Trustee for such Notes:
1. The information set forth
in Settlement Procedure "A."
2. Identification as a Fixed
Rate Book-Entry Note or a Floating
Rate Book-Entry Note.
3. The Initial Interest
Payment Date for such Book-Entry
Note, number of days by which such
date succeeds the related Regular
Record Date and amount of interest
payable on such Interest Payment
Date.
4. The Interest Payment
Period.
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5. The CUSIP number of the
Global Security representing such
Book-Entry Note.
6. The participant account
numbers maintained by DTC on behalf
of the Trustee and the Agent.
7. Whether such Global
Security will represent any other
Book-Entry Note (to the extent known
at such time).
C. To the extent the Company has
not already done so, the
Company will deliver to the
Trustee for such Notes a
Global Security in a form that
has been approved by the
Company, the Agent and the
Trustee.
D. The Trustee will complete such
Book-Entry Note, stamp the
appropriate legend, as
instructed by DTC, if not
already set forth thereon, and
authenticate the Global
Security representing such
Book-Entry Note.
E. DTC will credit such
Book-Entry Note to such DTC
Agent's participant account at
DTC.
F. Such DTC Agent will enter an
SDFS deliver order through
DTC's Participant Terminal
System instructing DTC to (i)
debit such Book-Entry Note to
such DTC Agent's participant
account and credit such
Book-Entry Note to the Agent's
participant account and (ii)
debit the Agent's settlement
account and credit such DTC
Agent's settlement account for
an amount equal to the price
of such Book-Entry Note less
the Agent's commission. The
entry of such a deliver order
shall constitute a
representation and warranty by
such DTC Agent to DTC that (i)
the Global Security
representing such Book-Entry
Note has been issued and
authenticated and
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(ii) such DTC Agent is holding
such Global Security pursuant
to the Medium Term Note
Certificate Agreement between
such DTC Agent and DTC.
G. Unless the Agent is purchasing
such Note as principal, the
Agent will enter an SDFS
deliver order through DTC's
Participant Terminal System
instructing DTC (i) to debit
such Book-Entry Note to the
Agent's participant account
and credit such Book-Entry
Note to the participant
accounts of the Participants
with respect to such
Book-Entry Note and (ii) to
debit the settlement accounts
of such Participants and
credit the settlement account
of the Agent for an amount
equal to the price of such
Book-Entry Note.
H. Transfers of funds in
accordance with SDFS deliver
orders described in Settlement
Procedures "F" and "G" will be
settled in accordance with
SDFS operating procedures in
effect on the settlement date.
I. Such DTC Agent will, upon
receipt of funds from the
Agent in accordance with
Settlement Procedure "G,"
credit to an account of the
Company maintained at such DTC
Agent funds available for
immediate use in the amount
transferred to such DTC Agent
in accordance with Settlement
Procedure "G."
J. Unless the Agent is purchasing
such Book-Entry Note as
principal, the Agent will
confirm the purchase of such
Book-Entry Note to the
purchaser either by
transmitting to the
Participants with respect to
such Book-Entry Note a
confirmation order or orders
through DTC's institutional
delivery system or by mailing
a written confirmation to such
purchaser.
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K. Monthly, each DTC Agent will
send to the Company a
statement setting forth the
principal amount of Registered
Notes Outstanding as of the
date of such statement and
setting forth a brief
description of any sales of
which the Company has advised
such DTC Agent but which have
not yet been settled.
Settlement Procedures Timetable: For sales by the Company of
Book-Entry Notes solicited by the
Agent and accepted by the Company
(except pursuant to a Terms
Agreement) for settlement on the
first Business Day after the sale
date, Settlement Procedures "A"
through "K" set forth above shall be
completed as soon as possible but
not later than the respective times
(New York City time) set forth
below:
Settlement
Procedure Time
--------- ----
A 11:00 A.M. on the sale date
B 12:00 Noon on the sale date
C 2:00 P.M. on the sale date
D 3:00 P.M. on the day before
settlement
E 9:00 A.M. on settlement date
F 10:00 A.M. on settlement date
G-H 2:00 P.M. on settlement date
I 4:45 P.M. on settlement date
J-K 5:00 P.M. on settlement date
If a sale is to be settled more than
one Business Day after the sale
date, Settlement Procedures "A," "B"
and "C" shall be completed as soon
as practicable but no later than
11:00 A.M., 12:00 Noon and 2:00
P.M., respectively on the first
Business Day after the sale date. If
the Initial Interest Rate for a
Floating Rate Book-Entry Note has
not been determined at the time that
Settlement Procedure "A" is
completed, Settlement Procedures "B"
and "C" shall be completed as soon
as such rate has been determined but
no later than 12:00 Noon and 2:00
P.M., respectively, on the Business
Day before the settlement date.
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51
Settlement Procedure "I" is subject
to extension in accordance with any
extension of Fedwire closing
deadlines and in the other events
specified in SDFS operating
procedures in effect on the
settlement date.
If settlement of a Book-Entry Note
is rescheduled or canceled, the DTC
Agent for such Book-Entry Notes
after receiving notice from the
Company or the Agent, will deliver
to DTC, through DTC's Participant
Terminal System, a cancellation
message to such effect by no later
than 2:00 P.M. on the Business Day
immediately preceding the scheduled
settlement date.
Failure to Settle: If settlement of a Book-Entry Note
is rescheduled and the DTC Agent for
such Note has not entered an SDFS
deliver order with respect to a
Book-Entry Note pursuant to
Settlement Procedure "F," after
receiving notice from the Company or
the Agent, such DTC Agent shall
deliver to DTC, through DTC's
Participant Terminal System, as soon
as practicable, a withdrawal message
instructing DTC to debit such
Book-Entry Note to such DTC Agent's
participant account. DTC will
process the withdrawal message,
provided that such DTC Agent's
participant account contains a
principal amount of the Global
Security representing such
Book-Entry Note that is at least
equal to the principal amount to be
debited. If a withdrawal message is
processed with respect to all the
Book-Entry Notes represented by a
Global Security, the Trustee for the
Notes represented by such Global
Security will mark such Global
Security "canceled," make
appropriate entries in such
Trustee's records and destroy the
canceled Global Security in
accordance with the applicable
Indenture and, if requested, deliver
a certificate of destruction to the
Company. The CUSIP number assigned
to such Global Security shall, in
accordance with CUSIP Service Bureau
procedures, be canceled and not
immediately reassigned. If a
withdrawal message is processed with
respect to one or
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52
more, but not all, of the Book-Entry
Notes represented by a Global
Security, the DTC Agent for such
Book-Entry Notes will exchange such
Global Security for two Global
Securities, one of which shall
represent such Book-Entry Notes and
shall be canceled immediately after
issuance and the other of which
shall represent the other Book-Entry
Notes previously represented by the
surrendered Global Security and
shall bear the CUSIP number of the
surrendered Global Security.
If the purchase price for any
Book-Entry Note is not timely paid
to the Participants with respect to
such Note by the beneficial
purchaser thereof (or a Person,
including an indirect participant in
DTC, acting on behalf of such
purchaser), such Participants and,
in turn, the Presenting Agent may
enter SDFS deliver orders through
DTC's Participant Terminal System
reversing the orders entered
pursuant to Settlement Procedures
"G" and "F," respectively.
Thereafter, the DTC Agent for such
Book-Entry Note will 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 a default by the Agent in
the performance of its obligations
hereunder and under the Distribution
Agreement, then the Company will
reimburse the Agent for the loss of
the use of the funds during the
period when they were credited to
the account of the Company.
Notwithstanding the foregoing, upon
any failure to settle with respect
to a Book-Entry Note, DTC may take
any actions in accordance with its
SDFS operating procedures then in
effect. In the event of a failure to
settle with respect to one or more,
but not all, of the Book-Entry Notes
to have been represented by a Global
Security, the DTC Agent for such
Book-Entry Note or Notes will
provide, in accordance with
Settlement Procedures "D" and "F,"
for the authentication and
B-25
53
issuance of a Global Security
representing the other Book-Entry
Notes, which have not failed to
settle, to have been represented by
such Global Security and will make
appropriate entries in its records.
Trustees Not to Risk Funds: Nothing herein shall be deemed to
require either Trustee to risk or
expend its own funds in connection
with any payment to the Company,
DTC, the Agent or the purchaser, it
being understood by all parties that
payments made by either Trustee to
the Company, DTC, the Agent or the
purchaser shall be made only to the
extent that funds are provided to
such Trustee for such purpose.
Authenticity of The Company will cause each of the
Signatures: Trustees to furnish the Agent from
time to time with the specimen
signatures of each of such Trustee's
officers, employees or agents who
has been authorized by such Trustee
to authenticate Book-Entry Notes,
but the Agent will not have any
obligation or liability to the
Company or the Trustee in respect of
the authenticity of the signature of
any officer, employee or agent of
the Company or the Trustee on any
Book-Entry Note.
Payment of The Agent shall forward to the
Expenses: Company, on a monthly basis, a
statement of the out-of-pocket
expenses incurred by such Agent
during that month that are
reimbursable to it pursuant to the
terms of the Distribution Agreement.
The Company will remit payment to
the Agent currently on a monthly
basis.
Advertising The Company will determine with the
Costs: Agent the amount of advertising that
may be appropriate in soliciting
offers to purchase the Book-Entry
Notes. Advertising expenses will be
paid by the Company.
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PART II
Administrative Procedures for Certificated Notes
Each Trustee will serve as registrar and transfer agent in
connection with the Certificated Notes for which it serves as Trustee.
Issuance: Each Certificated Note will be dated
and issued as of the date of its
authentication by the applicable
Trustee. Each Certificated Note will
bear an Original Issue Date, which
will be (i) with respect to an
original Certificated Note (or any
portion thereof), its original
issuance date (which will be the
settlement date) and (ii) with
respect to any Certificated Note (or
portion thereof) issued subsequently
upon transfer or exchange of a
Certificated Note or in lieu of a
destroyed, lost or stolen
Certificated Note, the Original
Issue Date of the predecessor
Certificated Note, regardless of the
date of authentication of such
subsequently issued Certificated
Note.
Registration: Certificated Notes will be issued
only in fully registered form
without coupons.
Maturities: Each Certificated Note will mature
on a date nine months or more after
the issue date for such Note. A
Floating Rate Certificated Note will
mature only on an Interest Payment
Date for such Note.
Currency: The Specified Currency for a
Certificated Note shall be as set
forth therein and in the applicable
Pricing Supplement.
Denominations: The denomination of any Certificated
Note denominated in U.S. dollars
will be a minimum of $1,000 or any
amount in excess thereof that is an
integral multiple of $1,000. The
authorized denominations of
Certificated Notes denominated in a
Specified Currency other than U.S.
dollars shall be determined as set
forth in the applicable Pricing
Supplement.
Interest: General. Unless otherwise indicated
in the applicable Pricing
Supplement, interest, if any, on
each Certificated Note will accrue
from the Original Issue Date (or
such other date on which interest
otherwise begins to accrue (if
different from the Original Issue
Date)) of such
B-27
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Note for the first interest period
or the last date to which interest
has been paid, if any, for each
subsequent interest period, on such
Note, and will be calculated and
paid in the manner and on the dates
described in such Note and in the
Prospectus, as supplemented by the
applicable Pricing Supplement.
Unless otherwise specified therein,
each payment of interest on a
Certificated Note will include
interest accrued to but excluding
the Interest Payment Date (provided
that, in the case of Certificated
Notes which reset daily or weekly,
interest payments will include
accrued interest to and including
the next preceding Regular Record
Date), except that at Stated
Maturity, the interest payable will
include interest accrued to, but
excluding, the stated Maturity
(other than a Maturity of a Fixed
Rate Certificated Note occurring on
the 31st day of a month, in which
case such payment of interest will
include interest accrued to but
excluding the 30th day of such
month).
Regular Record Dates. The Regular
Record Dates with respect to any
Interest Payment Date for a Fixed
Rate Note, Floating Rate Note or
Indexed Rate Note shall be the date
(whether or not a Business Day)
fifteen calendar days immediately
preceding such Interest Payment
Date.
Payments of The applicable Trustee will pay the
Interest: principal amount of each
Certificated Note at Maturity or
upon redemption upon presentation
and surrender of such Note to such
Trustee. Such payment, together with
payment of interest due at Maturity
or upon redemption of such Note,
will be made in funds available for
immediate use by such Trustee and in
turn by the holder of such Note.
Certificated Notes presented to such
Trustee at Maturity or upon
redemption for payment will be
canceled and destroyed by such
Trustee, and a certificate of
destruction will be delivered to the
Company. All interest payments on a
Certificated Note (other than
interest due at Maturity or upon
redemption) will be made by check
drawn on such Trustee (or another
person appointed by such Trustee)
B-28
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and mailed by such Trustee to the
person entitled thereto as provided
in such Note and the applicable
Indenture; provided, however, that
any holder of $10,000,000 or more of
Notes having the same Interest
Payment Dates will, upon written
request prior to the Regular Record
Date in respect of an Interest
Payment Date, be entitled to receive
payment by wire transfer of
immediately available funds.
Following each Regular Record Date,
such Trustee will furnish the
Company with a list of interest
payments to be made on the following
Interest Payment Date for each
Certificated Note and in total for
all Certificated Notes. Interest at
Maturity or upon redemption will be
payable to the person to whom the
payment of principal is payable.
Such Trustee will provide monthly to
the Company lists of principal and
interest, to the extent
ascertainable, to be paid on
Certificated Notes maturing or to be
redeemed in the next month.
Withholding Taxes. The amount of any
taxes required under applicable law
to be withheld from any interest
payment on a Certificated Note will
be determined and withheld by such
Trustee.
The Company will be responsible for
withholding taxes on interest paid
on Certificated Notes as required by
applicable law.
If any Interest Payment Date for or
the Maturity of a Certificated Note
is not a Business Day, the payment
due on such day shall be made on the
next succeeding Business Day and no
interest shall accrue on account of
such delayed payment. In the case of
a Floating Rate Note that is a LIBOR
note or a EURIBOR note (each as
described in the Prospectus), if
postponement to the next business
day would cause the interest payment
date to be in the next succeeding
calendar month, the Interest Payment
Date will instead be the immediately
preceding Business Day.
Procedure for Rate The Company and the Agent will
discuss from
B-29
57
Setting and Posting: time to time the aggregate principal
amount of, the issuance price of,
and the interest rates to be borne
by, Notes that may be sold as a
result of the solicitation of orders
by the Agent. If the Company decides
to set prices of, and rates borne
by, any Notes in respect of which
the Agent is to solicit orders (the
setting of such prices and rates to
be referred to herein as "posting")
or if the Company decides to change
prices or rates previously posted by
it, it will promptly advise the
Agent of the prices and rates to be
posted.
Acceptance and Unless otherwise instructed by the
Rejection of Orders: Company, the Agent will advise the
Company promptly by telephone of all
orders to purchase Certificated
Notes received by the Agent, other
than those rejected by it in whole
or in part in the reasonable
exercise of its discretion. Unless
otherwise agreed by the Company and
the Agent, the Company has the sole
right to accept orders to purchase
Certificated Notes and may reject
any such orders in whole or in part.
Before accepting any order to
purchase a Certificated Note to be
settled in less than three Business
Days, the Company shall verify that
the Trustee for such Certificated
Note will have adequate time to
prepare and authenticate such Note.
Preparation of Pricing If any order to purchase a
Supplement: Certificated Note is accepted by or
on behalf of the Company, the
Company will prepare a Pricing
Supplement reflecting the terms of
such Certificated Note, will file
one copy thereof by electronic
submission with the Commission in
accordance with the applicable
paragraph of Rule 424(b) under the
Act, will deliver such number of
copies thereof to the Agent as the
Agent shall request and will, on the
Agent's behalf, file three copies of
the Pricing Supplement with the
NASD. The Agent will cause a
Prospectus and Pricing Supplement to
be delivered to the purchaser of
such Certificated Note.
Copies of the appropriate number of
Pricing Supplements shall be
delivered to the Agent at the
following addresses by 11:00 A.M.,
New
B-30
58
York City time, on the Business Day
following the acceptance of an offer
by or on behalf of the Company:
Xxxxxxx Xxxxx Xxxxxx Inc., 0 Xxxxx
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 (with a copy transmitted by
telecopy to (000) 000-0000,
Attention: Medium Term Note
Department).
In each instance that a Pricing
Supplement is prepared, the
Presenting Agent will affix the
Pricing Supplement to Prospectuses
prior to their use. Outdated Pricing
Supplements and the Prospectuses to
which they are attached (other than
those retained for files), will be
destroyed.
Suspension of Subject to the Company's
Solicitation; representations, warranties and
Amendment or covenants contained in the
Supplement: Distribution Agreement, the Company
may instruct the Agent to suspend at
any time for any period of time or
permanently, the solicitation of
orders to purchase Certificated
Notes. Upon receipt of such
instructions, the Agent will
forthwith suspend solicitation until
such time as the Company has advised
it that such solicitation may be
resumed.
In the event that at the time the
Company suspends solicitation of
purchases there shall be any orders
outstanding for settlement, the
Company will promptly advise the
Agent and the Trustees whether such
orders may be settled and whether
copies of the Prospectus as in
effect at the time of the
suspension, together with the
appropriate Pricing Supplement, may
be delivered in connection with the
settlement of such orders. The
Company will have the sole
responsibility for such decision and
for any arrangements that may be
made in the event that the Company
determines that such orders may not
be settled or that copies of such
Prospectus may not be so delivered.
Delivery of A copy of the Prospectus and a
Prospectus: Pricing Supplement relating to a
Certificated Note must accompany or
precede the earliest of any written
offer of such Certificated Note,
confirmation of
B-31
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the purchase of such Certificated
Note and payment for such
Certificated Note by its purchaser.
If notice of a change in the terms
of the Certificated Notes is
received by the Agent between the
time an order for a Certificated
Note is placed and the time written
confirmation thereof is sent by the
Agent to a customer or his agent,
such confirmation shall be
accompanied by a Prospectus and
Pricing Supplement setting forth the
terms in effect when the order was
placed. The Agent will deliver a
Prospectus and Pricing Supplement as
herein described with respect to
each Certificated Note sold by it.
The Company will make such delivery
if such Certificated Note is sold
directly by the Company to a
purchaser (other than the Agent).
Confirmation: For each order to purchase a
Certificated Note solicited by the
Agent and accepted by or on behalf
of the Company, the Agent will issue
a confirmation to the purchaser,
with a copy to the Company, setting
forth the details set forth above
and delivery and payment
instructions.
Settlement: The receipt by the Company of
immediately available funds in
exchange for an authenticated
Certificated Note delivered to the
Agent and the Agent's delivery of
such Certificated Note against
receipt of immediately available
funds shall, with respect to such
Certificated Note, constitute
"settlement." All orders accepted by
the Company will be settled on the
fifth Business Day next succeeding
the date of acceptance pursuant to
the timetable for settlement 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
following the date of sale.
Settlement Settlement Procedures with regard to
Procedures: each Certificated Note sold by the
Company to or through the Agent, as
agent (except pursuant to a Terms
Agreement), shall be as follows:
A. The Agent will advise the
Company by telephone (or by
facsimile transmission or other
acceptable written means) that
such
B-32
60
Note is a Certificated Note and
of the following settlement
information, in time for the
Trustee for such Certificated
Note to prepare and
authenticate the required Note:
1. Name in which such
Certificated Note is to be
registered ("Registered Owner").
2. Address of the Registered
Owner and address for payment of
principal and interest.
3. Taxpayer identification
number of the Registered Owner (if
available).
4. Principal or face amount.
5. Series.
6. Stated Maturity.
7. In the case of a Fixed Rate
Certificated Note, the Interest Rate
and reset provisions (if any) or, in
the case of a Floating Rate
Certificated Note, the Base Rate,
Initial Interest Rate (if known at
such time), Interest Reset Period,
Interest Reset Dates, Index
Maturity, Spread and/or Spread
Multiplier (if any), Minimum
Interest Rate (if any), Maximum
Interest Rate (if any) and reset
provisions (if any).
8. Interest Payment Dates and
the Interest Payment Period.
9. Specified Currency.
10. Denominated Currency,
Indexed Currency, Base Exchange Rate
and the Determination Date, if
applicable.
11. Redemption, repayment,
amortization or extension
provisions, if any.
12. Settlement Date.
13. Price (including currency).
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14. Agent's commission, if any,
determined as provided in the
Distribution Agreement.
15. Whether such Certificated
Note is an OID Note, and, if so, the
total amount of OID and the yield to
maturity.
16. Any other terms necessary
to describe the Certificated Note.
B. The Company will advise the
relevant Trustee by telephone
(confirmed in writing at any
time on the sale date), written
telecommunication or electronic
transmission of the information
set forth in Settlement
Procedure "A" above and the
name of the Presenting Agent.
C. The Company will deliver to the
relevant Trustee a pre-printed
four-ply packet for such
Certificated Note, which packet
will contain the following
documents in forms that have
been approved by the Company,
the Agent and the Trustee:
1. Certificated Note with
customer confirmation.
2. Stub One - For Trustee.
3. Stub Two - For Agent.
4. Stub Three - For the
Company.
D. The Trustee will complete such
Certificated Note and will
authenticate such Certificated
Note and deliver it (with the
confirmation) and Stubs One and
Two to the Agent, and the Agent
will acknowledge receipt of the
Note by stamping or otherwise
marking Stub One and returning
it to the Trustee. Such
delivery will be made only
against such acknowledgment of
receipt and evidence that
instructions have been given by
the Agent for payment to such
account as the Company
B-34
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shall have specified in funds
available for immediate use, of
an amount equal to the price of
such Certificated Note less the
Agent's commission. In the
event that the instructions
given by the Agent for payment
to the account of the Company
are revoked, the Company will
as promptly as possible wire
transfer to the account of the
Agent an amount of immediately
available funds equal to the
amount of such payment made.
E. Unless the Agent purchased the
Note as principal, the Agent
will deliver such Certificated
Note (with the confirmation) to
the customer against payment in
immediately payable funds. The
Agent will obtain the
acknowledgment of receipt of
such Certificated Note by
retaining Stub Two.
F. The Trustee will send Stub
Three to the Company by
first-class mail.
Settlement For orders of Certificated Notes
Procedures solicited by the Agent, as agent,
Timetable: and accepted by the Company,
Settlement Procedures "A" through
"F" set forth above shall be
completed on or before the
respective times (New York City
time) set forth below:
Settlement
Procedure Time
--------- ----
A 2:00 P.M. on the day before
settlement
B On the day two Business Days
before settlement date.
C 2:15 P.M. two Business Days
before settlement
D 2:15 P.M. on settlement date
E 3:00 P.M. on settlement date
F 5:00 P.M. on settlement date
Procedures upon Company Notice to Trustee regarding
Company's Exercise Exercise of Optional Reset. Not less
of Optional Reset than 45 or more than 60 days before
an Optional Reset Date as
B-35
63
or Extension of set forth in a Certificated Note,
Maturity: the Company will notify the Trustee
for such Certificated Note whether
it is exercising its option to reset
the interest rate or Spread or
Spread Multiplier, as the case may
be, for such Certificated Note, and
if so, (i) the new interest rate or
Spread or Spread Multiplier, as the
case may be, for such Certificated
Note during the period from such
Optional Reset Date to the next
Optional Reset Date as set forth in
such Certificated Note or, if there
is no such next Optional Reset Date,
to the Stated Maturity of such
Certificated Note (the "Subsequent
Interest Period"); and (ii) the
provisions, if any, for redemption
of such Certificated Note during
such Subsequent Interest Period,
including the date or dates on which
or the period or periods during
which such redemption may occur
during such Subsequent Interest
Period.
Company Notice to Trustee regarding
Exercise of Optional Extension of
Maturity. If the Company elects to
exercise an option, as set forth in
a Certificated Note, to extend the
Stated Maturity of such Note, it
will so notify the Trustee for such
Certificated Note not less than 45
or more than 60 days before the
Stated Maturity of such Certificated
Note, and will further indicate (i)
the new Stated Maturity; (ii) the
interest rate or Spread or Spread
Multiplier, as the case may be,
applicable to the extension period;
and (iii) the provisions, if any,
for redemption of such Certificated
Note during such extension period,
including the date or dates on which
or the period or periods during
which such redemption may occur
during such extension period.
Trustee Notice to Holders regarding
Company's Exercise of Optional
Extension or Reset. Upon receipt of
notice from the Company regarding
the Company's exercise of either an
optional extension of maturity or an
optional reset, the Trustee for the
Certificated Note will mail a
notice, first class, postage
prepaid, to the Holder of the
Certificated Note not less than 40
days before the Optional Reset Date
(in which case a "Reset Notice") or
the Stated Maturity
B-36
64
(in which case an "Extension
Notice"), as the case may be, which
Reset Notice or Extension Notice
shall contain the information
required by the terms of the
Certificated Note.
Trustee Notice to Company regarding
Option to be Repaid. If, after
receipt of either a Reset Notice or
an Extension Notice, any Holder of a
Certificated Note exercises the
option for repayment by tendering
the Certificated Note to be repaid
as set forth in the Certificated
Note, the Trustee for such
Certificated Note shall give notice
to the Company not less than 22 days
before the Optional Reset Date, or
the old Stated Maturity, as the case
may be, of the principal amount of
Certificated Notes to be repaid on
such Optional Reset Date or old
Stated Maturity, as the case may be.
Company Notice regarding New
Interest Rate or New Spread or
Spread Multiplier. If the Company
elects to revoke the interest rate
or Spread or Spread Multiplier and
establish a higher interest rate or
Spread or Spread Multiplier for an
Optional Reset Period or extension
period, as the case may be, it
shall, not less than 20 days before
such Optional Reset Date or old
Stated Maturity, so notify the
Trustee for the affected
Certificated Note. The Trustee will
immediately thereafter notify the
Holder of such Certificated Note, by
first class mail, postage prepaid,
of the new higher interest rate or
Spread or Spread Multiplier
applicable to such Certificated
Note.
Trustee Notice to Company regarding
Holder Revocation of Option to be
Repaid. If, after the Holder of a
Certificated Note has tendered such
Note for repayment pursuant to an
Extension Notice or a Reset Notice,
such Holder revokes such tender for
repayment, the Trustee for such
Certificated Note shall give notice
to the Company not less than five
days prior to the Stated Maturity or
Optional Reset Date, as the case may
be, of such revocation and of the
principal amount of Certificated
Notes for which tender for repayment
has been revoked.
B-37
65
Deposit of Repayment Price. On or
before any old Stated Maturity where
the Maturity has been extended, and
on or before any Optional Reset
Date, the Company shall deposit with
such Trustee an amount of money
sufficient to pay the principal
amount, plus interest accrued to
such old Stated Maturity or Optional
Reset Date, as the case may be, for
all the Certificated Notes or
portions thereof for which such
Trustee serves as Trustee and which
are to be repaid on such old Stated
Maturity or Optional Reset Date, as
the case may be. Such Trustee will
use such money to repay such
Certificated Notes pursuant to the
terms set forth in such Notes.
Procedures upon Company Notice to Trustee regarding
Company's Exercise Exercise of Optional Redemption. At
of Optional least 45 days prior to the date on
Redemption: which it intends to redeem a
Certificated Note, the Company will
notify the Trustee for such
Certificated Note that it is
exercising such option with respect
to such Note on such date.
Trustee Notice to Holders regarding
Company's Exercise of Optional
Redemption. After receipt of notice
that the Company is exercising its
option to redeem a Certificated
Note, the Trustee for such
Certificated Note will, at least 30
days before the Redemption Date for
such Certificated Note, mail a
notice, first class, postage
prepaid, to the Holder of such
Certificated Note, informing such
Holder of the Company's exercise of
such option with respect to such
Certificated Note.
Payments of Principal and Interest Trustee Notice to Company of Option
Upon Exercise of Optional Repayment to be Repaid. Upon receipt of notice
(Except Pursuant to Company's of exercise of the option for
Exercise of Optional Reset or repayment and the Certificated Notes
Optional Extension): to be repaid as set forth in such
Notes, the Trustee for such
Certificated Notes shall (unless
such notice was received pursuant to
the Company's exercise of an
optional reset or an optional
extension of maturity, in each of
which cases the relevant procedures
set forth above shall be followed)
give notice to the Company not less
than 20 days prior to each
B-38
66
Optional Repayment Date of such
Optional Repayment Date and of the
principal amount of Certificated
Notes to be repaid on such Optional
Repayment Date.
Failure to Settle: If a purchaser fails to accept
delivery of and make payment for any
Certificated Note, the Agent will
notify the Company and the
applicable Trustee by telephone and
return such Note to the applicable
Trustee. Upon receipt of such
notice, the Company will immediately
wire transfer to the account of the
Agent an amount equal to the amount
previously credited thereto in
respect of such Note. Such wire
transfer will be made on the
Settlement Date, if possible, and in
any event not later than the
Business Day following the
settlement date. If the failure
shall have occurred for any reason
other than a default by the Agent in
the performance of its obligations
hereunder and under the Distribution
Agreement with the Company, then the
Company will reimburse the Agent or
the applicable Trustee, as
appropriate, on an equitable basis
for its loss of the use of the funds
during the period when they were
credited to the account of the
Company. Immediately upon receipt of
the Certificated Note in respect of
which such failure occurred, the
applicable Trustee will mark such
Note "canceled," make appropriate
entries in the applicable Trustee's
records and send such Note to the
Company.
Trustees Not to Risk Nothing herein shall be deemed to
Funds: require either Trustee to risk or
expend its own funds in connection
with any payment to the Company, the
Agent or the purchaser, it being
understood by all parties that
payments made by either Trustee to
the Company, the Agent or the
purchaser shall be made only to the
extent that funds are provided to
such Trustee for such purpose.
Authenticity of The Company will cause each Trustee
Signatures: to furnish the Agent from time to
time with the specimen signatures of
each of such Trustee's officers,
employees or agents who has been
authorized by such Trustee to
authenticate Certifi-
B-39
67
cated Notes, but the Agent will not
have any obligation or liability to
the Company or a Trustee in respect
of the authenticity of the signature
of any officer, employee or agent of
the Company or a Trustee on any
Certificated Note.
Payment of Expenses: The Agent shall forward to the
Company, on a monthly basis, a
statement of the out-of-pocket
expenses incurred by the Agent
during that month that are
reimbursable to it pursuant to the
terms of the Distribution Agreement.
The Company will remit payment to
the Agent currently on a monthly
basis.
Advertising Costs: The Company will determine with the
Agent the amount of advertising that
may be appropriate in soliciting
orders to purchase the Certificated
Notes. Advertising expenses will be
paid by the Company.
B-40
68
Exhibit C
Opinion of the Depty General Counsel
------------------------------------
or an Associate General Counsel
-------------------------------
of the Company
--------------
C-1
69
Exhibit D
Opinion of Counsel for the Agent
--------------------------------
D-1
70
Exhibit E
Letter from Accountants
E-1
71
Exhibit F
ADDITIONAL AGENTS AGREEMENT
---------------------------
F-1
72
Schedule I
Agent(s)
F-4
73
Annex A
Form of Distribution Agreement
F-5
