THE XXXXXXX XXXXXX CORPORATION
Medium-Term Notes, Series A
Due More than 9 Months from Date of Issue
DISTRIBUTION AGREEMENT
September 25, 1995
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Xxxxxxx, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Xxxxxxx Xxxxxx & Co., Inc.
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Dear Ladies/Gentlemen:
The Xxxxxxx Xxxxxx Corporation, a Delaware
corporation (the "Company"), confirms its agreement with each
of you with respect to the issue and sale from time to time
by the Company of such aggregate initial public offering
price of its Medium-Term Notes, Series A, due more than 9
months from date of issue, as at such time (a) has been duly
authorized for issuance and sale by the Board of Directors of
the Company and (b) is covered by one or more registration
statements that have become effective under the Securities
Act of 1933, as amended (the "Notes"). The Notes may be
issued as senior indebtedness (the "Senior Notes") or as
senior subordinated indebtedness (the "Senior Subordinated
Notes") of the Company. The Senior Notes will be issued
pursuant to the provisions of a senior indenture dated as of
July 15, 1993 (the "Senior Debt Indenture") between the
Company and Chemical Bank, as trustee (the "Trustee"). The
Senior Subordinated Notes will be issued pursuant to the
provisions of a senior subordinated indenture dated as of
July 15, 1993 (the "Senior Subordinated Debt Indenture")
between the Company and the Trustee. The Senior Debt
Indenture and the Senior Subordinated Debt Indenture are
sometimes hereinafter referred to individually as an
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"Indenture" and collectively as the "Indentures." The Notes
will have the maturities, interest rates, redemption
provisions, if any, and other terms as set forth in
supplements to the Basic Prospectus referred to below.
The Company hereby appoints Xxxxxx Xxxxxxx & Co.
Incorporated ("Xxxxxx Xxxxxxx"), Xxxxxxx, Xxxxx & Co.
("Xxxxxxx, Sachs") and Xxxxxxx Xxxxxx & Co., Inc. ("Xxxxxxx
Xxxxxx") (individually, an "Agent" and collectively, the
"Agents") as its exclusive agents, subject to Section 12, for
the purpose of soliciting and receiving offers to purchase
Notes from the Company by others and, on the basis of the
representations and warranties herein contained, but subject
to the terms and conditions herein set forth, each Agent
agrees to use reasonable efforts to solicit and receive
offers to purchase Notes upon terms acceptable to the Company
at such times and in such amounts as the Company shall from
time to time specify. In addition, any Agent may also
purchase Notes as principal pursuant to the terms of a terms
agreement relating to such sale (a "Terms Agreement") in
accordance with the provisions of Section 2(b) hereof. The
Company also reserves the right to sell Notes directly to
purchasers on its own behalf. Each Agent acknowledges that,
in the case of any sale of Notes by the Company not resulting
from a solicitation made or an offer to purchase received by
such Agent, or arising in connection with a purchase by such
Agent as principal, no commission shall be payable to such
Agent with respect to such sale.
The Company has filed with the Securities and
Exchange Commission (the "Commission") a registration
statement, including a prospectus, and may in the future file
one or more additional registration statements, in each case
including a prospectus, relating to the Notes. The term
"Registration Statement," as used herein, means, at any time,
such of the foregoing registration statements, including the
exhibits thereto, as are being used to offer Notes at such
time. The Company proposes to file with the Commission from
time to time, pursuant to Rule 424 under the Securities Act
of 1933, as amended (the "Securities Act"), supplements to
the prospectus included in the Registration Statement that
will describe certain terms of the Notes. The prospectus in
the form in which it appears in the Registration Statement is
hereinafter referred to as the "Basic Prospectus." The term
"Prospectus" means the Basic Prospectus together with the
prospectus supplement or supplements (each a "Prospectus
Supplement") specifically relating to Notes, as filed with,
or transmitted for filing to, the Commission pursuant to
Rule 424. As used herein, the terms "Basic Prospectus" and
"Prospectus" shall include in each case the documents, if
any, incorporated by reference therein. The terms
"supplement," "amendment" and "amend" as used herein shall
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include all documents deemed to be incorporated by reference
in the Prospectus that are filed subsequent to the date of
the Basic Prospectus by the Company with the Commission
pursuant to the Securities Exchange Act of 1934, as amended
(the "Exchange Act").
1. Representations and Warranties. The Company
represents and warrants to and agrees with each Agent as of
the Commencement Date, as of each date on which an Agent
solicits offers to purchase Notes, as of each date on which
the Company accepts an offer to purchase Notes (including any
purchase by an Agent pursuant to a Terms Agreement), as of
each date the Company issues and delivers Notes and as of
each date the Registration Statement or the Basic Prospectus
is amended or supplemented, as follows (it being understood
that such representations, warranties and agreements shall be
deemed to relate to the Registration Statement, the Basic
Prospectus and the Prospectus, each as amended or
supplemented to each such date):
(a) The Registration Statement has become
effective; no stop order suspending the effectiveness of the
Registration Statement is in effect, and no proceedings for
such purpose are pending before or threatened by the
Commission.
(b) (i) Each document, if any, filed or to be
filed pursuant to the Exchange Act and incorporated by
reference in the Prospectus complied or will comply when so
filed in all material respects with the Exchange Act and the
applicable rules and regulations of the Commission
thereunder, (ii) each part of the Registration Statement,
when such part became effective, did not contain, and each
such part, as amended or supplemented, if applicable, will
not contain any untrue statement of a material fact or omit
to state a material fact required to be stated therein or
necessary to make the statements therein not misleading,
(iii) the Registration Statement and the Prospectus comply,
and, as amended or supplemented, if applicable, will comply
in all material respects with the Securities Act and the
applicable rules and regulations of the Commission thereunder
and (iv) the Prospectus does not contain and, as amended or
supplemented, if applicable, will not contain any 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 under which they were made, not misleading,
except that (1) the representations and warranties set forth
in this Section 1(b) do not apply (A) to statements or
omissions in the Registration Statement or the Prospectus
based upon information relating to an Agent furnished to the
Company in writing by such Agent expressly for use therein or
(B) to that part of the Registration Statement that
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constitutes the Statement of Eligibility (Form T-1) under the
Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), of the Trustee and (2) the representations and
warranties set forth in clauses (iii) and (iv) above, when
made as of the Commencement Date or as of any date on which
an Agent solicits offers to purchase Notes or on which the
Company accepts an offer to purchase Notes, shall be deemed
not to cover information concerning an offering of particular
Notes to the extent such information will be set forth in a
supplement to the Basic Prospectus.
(c) The Company is a duly incorporated, validly
existing corporation in good standing under the laws of the
State of Delaware, has the corporate power and authority to
own its property and conduct its business as described in the
Prospectus and is duly qualified to transact business and is
in good standing in each jurisdiction in which the conduct of
its business or its ownership or leasing of property requires
such qualification, except to the extent that the failure to
be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries,
taken as a whole.
(d) Each of Xxxxxx Holdings, Inc. ("Holdings"),
Xxxxxxx Xxxxxx, Xxxxx & Xxxxxxxxxx, Inc. ("M&S") and each
other subsidiary of the Company that is a "significant
subsidiary" within the meaning of Rule 1-02 of Regulation S-X
of the Commission (each, a "Significant Subsidiary" and
collectively, the "Significant Subsidiaries") is a duly
incorporated, validly existing corporation in good standing
under the laws of the jurisdiction of its incorporation, has
the corporate power and authority to own its property and
conduct its business as described in the Prospectus and is
duly qualified to transact business and is in good standing
in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material
adverse effect on the Company and its subsidiaries, taken as
a whole.
(e) Each of this Agreement and any applicable
Written Terms Agreement (as hereinafter defined) has been
duly authorized, executed and delivered by the Company.
(f) Each Indenture has been duly qualified under
the Trust Indenture Act and has been duly authorized,
executed and delivered by the Company and is a valid and
binding agreement of the Company, enforceable in accordance
with its terms except as (i) the enforceability thereof may
be limited by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and (ii) rights of
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acceleration and the availability of equitable remedies may
be limited by equitable principles of general applicability.
(g) The forms of Notes have been duly authorized
and, when the Notes have been executed and authenticated in
accordance with the provisions of the relevant Indenture and
delivered to and duly paid for by the purchasers thereof, the
Notes will be entitled to the benefits of such Indenture and
will be valid and binding obligations of the Company,
enforceable in accordance with their respective terms except
as (i) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditors'
rights generally and (ii) rights of acceleration and the
availability of equitable remedies may be limited by
equitable principles of general applicability.
(h) The execution and delivery by the Company of
this Agreement, the Notes, the Indentures and any applicable
Written Terms Agreement, and the performance by the Company
of its obligations under this Agreement, the Notes, the
Indentures and any applicable Terms Agreement will not
contravene any provision of applicable law or the certificate
of incorporation or by-laws of the Company or Xxxxxxx Xxxxxx
or any agreement or other instrument binding upon the Company
or any of its subsidiaries that is material to the Company
and its subsidiaries, taken as a whole, or any judgment,
order or decree of any governmental body, agency or court
having jurisdiction over the Company or any subsidiary, and
no consent, approval, authorization or order of, or
qualification with, any governmental body or agency is
required for the performance by the Company of its
obligations under this Agreement, the Notes, the Indentures
and any applicable Terms Agreement, or for the performance by
Xxxxxxx Xxxxxx of its obligations under this Agreement and
any applicable Terms Agreement, except such as have been
obtained, and such as may be required by the securities or
Blue Sky laws of the various states in connection with the
offer and sale of the Notes.
(i) There has not occurred any material adverse
change, or any development which could reasonably be expected
to result in a material adverse change, in the condition,
financial or otherwise, or in the earnings, business or
operations of the Company and its subsidiaries, taken as a
whole, from that set forth in the Prospectus.
(j) There are no legal or governmental proceedings
pending or threatened to which the Company or any of its
subsidiaries is a party or to which any of the properties of
the Company or any of its subsidiaries is subject that are
required to be described in the Registration Statement or the
Prospectus and are not so described or any statutes,
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regulations, contracts or other documents that are required
to be described in the Registration Statement or the
Prospectus or to be filed or incorporated by reference as
exhibits to the Registration Statement that are not
described, filed or incorporated as required.
(k) The Company is not an "investment company" or
an entity "controlled" by an "investment company," as such
terms are defined in the Investment Company Act of 1940, as
amended.
(l) The Company has complied with all provisions
of Section 517.075, Florida Statutes (Chapter 92-198, Laws of
Florida).
(m) Each of the Company and its Significant
Subsidiaries has all necessary consents, authorizations,
approvals, orders, certificates and permits of and from, and
has made all declarations and filings with, all federal,
state, local and other governmental authorities, all
self-regulatory organizations and all courts and other
tribunals, to own, lease, license and use its properties and
assets and to conduct its business in the manner described in
the Prospectus, except to the extent that the failure to
obtain or file would not have a material adverse effect on
the Company and its subsidiaries, taken as a whole.
(n) Each of the Company and its Significant
Subsidiaries is duly registered as a broker-dealer, municipal
securities broker or dealer, investment adviser, or transfer
agent, as the case may be, in each jurisdiction wherein the
conduct of its business requires such registration, and each
of the Company and its Significant Subsidiaries is in
compliance in all material respects with all applicable laws,
rules, regulations, orders, by-laws and similar requirements
in connection with such registrations, except to the extent
that the failure to be so registered or be in compliance
would not have a material adverse effect on the Company and
its subsidiaries, taken as a whole.
(o) Xxxxxxx Xxxxxx is a member in good standing of
the associations and exchanges indicated in the Prospectus
and is registered as a broker-dealer with the Commission and
in all 50 states, the District of Columbia and Puerto Rico,
except to the extent that the failure to be in good standing
or be so registered would not have a material adverse effect
on the Company and its subsidiaries, taken as a whole.
(p) M&S is a member in good standing of the
associations and exchanges, and is registered as a broker-
dealer with the Commission and in each of the jurisdictions,
indicated in the Prospectus, except to the extent that the
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failure to be in good standing or be so registered would not
have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
2. Solicitations as Agent; Purchases as
Principal.
(a) Solicitations as Agent. In connection with an
Agent's actions as agent hereunder, such Agent agrees to use
reasonable efforts to solicit offers to purchase Notes upon
the terms and conditions set forth in the Prospectus as then
amended or supplemented.
The Company reserves the right, in its sole
discretion, to instruct the Agents to suspend at any time,
for any period of time or permanently, the solicitation of
offers to purchase Notes. Upon receipt of at least one
business day's prior notice from the Company, the Agents will
forthwith suspend solicitations of offers to purchase Notes
from the Company until such time as the Company has advised
the Agents that such solicitation may be resumed. While such
solicitation is suspended, the Company shall not be required
to deliver any certificates, opinions or letters in
accordance with Sections 5(a), 5(b) and 5(c); provided,
however, that if the Registration Statement or Prospectus is
amended or supplemented during the period of suspension
(other than by an amendment or supplement providing solely
for a change in the interest rates, redemption provisions,
amortization schedules or maturities offered on the Notes or
for a change the Agents deem to be immaterial), no Agent
shall be required to resume soliciting offers to purchase
Notes until the Company has delivered such certificates,
opinions and letters as such Agent may request.
The Company agrees to pay to each Agent, as
consideration for the sale of each Note resulting from a
solicitation made or an offer to purchase received by such
Agent, a commission in the form of a discount from the
purchase price of such Note equal to the percentage set forth
below of the purchase price of such Note:
Term Commission Rate
From 9 months to less than 12 months .125%
From 12 months to less than 18 months .150%
From 18 months to less than 2 years .200%
From 2 years to less than 3 years .250%
From 3 years to less than 4 years .350%
From 4 years to less than 5 years .450%
From 5 years to less than 6 years .500%
From 6 years to less than 7 years .550%
From 7 years to less than 10 years .600%
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From 10 years to less than 15 years .625%
From 15 years to less than 20 years .700%
From 20 years to 30 years .750%
More than 30 years .875%
Each Agent shall communicate to the Company, orally
or in writing, each offer to purchase Notes received by such
Agent as agent that in its judgment should be considered by
the Company. The Company shall have the sole right to accept
offers to purchase Notes and may reject any offer in whole or
in part. Each Agent shall have the right to reject any offer
to purchase Notes that it considers to be unacceptable, and
any such rejection shall not be deemed a breach of its
agreements contained herein. The procedural details relating
to the issue and delivery of Notes sold by the Agents as
agents and the payment therefor shall be as set forth in the
Administrative Procedures (as hereinafter defined).
(b) Purchases as Principal. Each sale of Notes to
an Agent as principal shall be made in accordance with the
terms of this Agreement. In connection with each such sale,
the Company will enter into a Terms Agreement that will
provide for the sale of such Notes to and the purchase
thereof by such Agent. Each Terms Agreement will take the
form of either (i) a written agreement between such Agent and
the Company, which may be substantially in the form of
Exhibit A hereto (a "Written Terms Agreement"), or (ii) an
oral agreement between such Agent and the Company confirmed
in writing by such Agent to the Company.
An Agent's commitment to purchase Notes as
principal pursuant to a Terms Agreement shall be deemed to
have been made on the basis of the representations and
warranties of the Company herein contained and shall be
subject to the terms and conditions herein set forth. Each
Terms Agreement shall specify the principal amount of Notes
to be purchased by such 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 Terms Agreement may also specify any
requirements for officers' certificates, opinions of counsel
and letters from the independent auditors of the Company
pursuant to Section 4 hereof. A Terms Agreement may also
specify certain provisions relating to the reoffering of such
Notes by such Agent.
Each Terms Agreement shall specify the time and
place of delivery of and payment for such Notes. Unless
otherwise specified in a Terms Agreement, the procedural
details relating to the issue and delivery of Notes purchased
by an Agent as principal and the payment therefor shall be as
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set forth in the Administrative Procedures. Each date of
delivery of and payment for Notes to be purchased by an Agent
pursuant to a Terms Agreement is referred to herein as a
"Settlement Date."
Unless otherwise specified in a Terms Agreement, if
an Agent is purchasing Notes as principal such Agent may
resell such Notes to other dealers. Any such sales may be at
a discount, which shall not exceed the amount set forth in
the Prospectus Supplement relating to such Notes.
(c) Administrative Procedures. The Agents and the
Company agree to perform the respective duties and
obligations specifically provided to be performed in the
Medium-Term Notes, Series A, Administrative Procedures
(attached hereto as Exhibit B) (the "Administrative
Procedures"), as amended from time to time. The
Administrative Procedures may be amended only by written
agreement of the Company and the Agents.
(d) Delivery. The documents required to be
delivered by Section 4 of this Agreement as a condition
precedent to each Agent's obligation to begin soliciting
offers to purchase Notes as an agent of the Company shall be
delivered at the office of Howard, Rice, Nemerovski, Canady,
Xxxx & Xxxxxx, A Professional Corporation, counsel for the
Company, not later than 1:00 p.m., California time, on the
date hereof, or at such other time and/or place as the Agents
and the Company may agree upon in writing, but in no event
later than the day prior to the earlier of (i) the date on
which the Agents begin soliciting offers to purchase Notes
and (ii) the first date on which the Company accepts any
offer by an Agent to purchase Notes pursuant to a Terms
Agreement. The date of delivery of such documents is
referred to herein as the "Commencement Date."
(e) Obligations Several. The Company acknowledges
that the obligations of the Agents under this Agreement are
several and not joint.
3. Agreements. The Company agrees with each
Agent that:
(a) Prior to the termination of the offering of
the Notes pursuant to this Agreement or any Terms Agreement,
the Company will not file any Prospectus Supplement relating
to the Notes or any amendment to the Registration Statement
unless the Company has previously furnished to the Agents
copies thereof for their review and will not file any such
proposed supplement or amendment to which the Agents
reasonably object; provided, however, that (i) the foregoing
requirement shall not apply to any of the Company's periodic
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filings with the Commission required to be filed pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, copies
of which filings the Company will cause to be delivered to
the Agents promptly after being transmitted for filing with
the Commission and (ii) any Prospectus Supplement that merely
sets forth the terms or a description of particular Notes
shall only be reviewed and approved by the Agent or Agents
offering such Notes. Subject to the foregoing sentence, the
Company will promptly cause each Prospectus Supplement to be
filed with or transmitted for filing to the Commission in
accordance with Rule 424(b) under the Securities Act. The
Company will promptly advise the Agents (i) of the filing of
any amendment or supplement to the Basic Prospectus (except
that notice of the filing of an amendment or supplement to
the Basic Prospectus that merely sets forth the terms or a
description of particular Notes shall only be given to the
Agent or Agents offering such Notes), (ii) of the filing and
effectiveness of any amendment to the Registration Statement,
(iii) of any request by the Commission for any amendment to
the Registration Statement or any amendment or supplement to
the Basic Prospectus or for any additional information,
(iv) of 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) of 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 reasonable efforts to prevent
the issuance of any such stop order or notice of suspension
of qualification and, if issued, to obtain as soon as
possible the withdrawal thereof. If the Basic Prospectus is
amended or supplemented as a result of the filing under the
Exchange Act of any document incorporated by reference in the
Prospectus, no Agent shall be obligated to solicit offers to
purchase Notes so long as it is not reasonably satisfied with
such document.
(b) If, at any time when a prospectus relating to
the Notes is required to be delivered under the Securities
Act, any event occurs or condition exists as a result of
which the Prospectus, as then amended or supplemented, would
include an untrue statement of a material fact, or omit to
state any material fact necessary to make the statements
therein, in the light of the circumstances when the
Prospectus, as then amended or supplemented, is delivered to
a purchaser, not misleading, or if, in the opinion of the
Agents or in the opinion of the Company, it is necessary at
any time to amend or supplement the Prospectus, as then
amended or supplemented, to comply with applicable law, the
Company will immediately notify the Agents by telephone (with
confirmation in writing) to suspend solicitation of offers to
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purchase Notes and, if so notified by the Company, the Agents
shall forthwith suspend such solicitation and cease using the
Prospectus, as then amended or supplemented. If the Company
shall decide to amend or supplement the Registration
Statement or Prospectus, as then amended or supplemented, it
shall so advise the Agents promptly by telephone (with
confirmation in writing) and, at its expense, shall prepare
and cause to be filed promptly with the Commission an
amendment or supplement to the Registration Statement or
Prospectus, as then amended or supplemented, satisfactory in
all respects to the Agents, that will correct such statement
or omission or effect such compliance and will supply such
amended or supplemented Prospectus to the Agents in such
quantities as they may reasonably request. If any documents,
certificates, opinions and letters furnished to the Agents
pursuant to paragraph (f) below and Sections 5(a), 5(b) and
5(c) in connection with the preparation and filing of such
amendment or supplement are satisfactory in all respects to
the Agents, upon the filing with the Commission of such
amendment or supplement to the Prospectus or upon the
effectiveness of an amendment to the Registration Statement,
the Agents will resume the solicitation of offers to purchase
Notes hereunder. Notwithstanding any other provision of this
Section 3(b), until 180 days after the date any Agent has
purchased Notes as principal from the Company, if any event
described above in this paragraph (b) occurs, the Company
will, at its own expense, forthwith prepare and cause to be
filed promptly with the Commission an amendment or supplement
to the Registration Statement or Prospectus, as then amended
or supplemented, satisfactory in all respects to such Agent,
will supply such amended or supplemented Prospectus to such
Agent in such quantities as it may reasonably request and
shall furnish to such Agent pursuant to paragraph (f) below
and Sections 5(a), 5(b) and 5(c) such documents,
certificates, opinions and letters as it may request in
connection with the preparation and filing of such amendment
or supplement.
(c) The Company will make generally available to
its security holders and to the Agents as soon as practicable
earning statements that satisfy the provisions of
Section 11(a) of the Securities Act and the rules and
regulations of the Commission thereunder covering twelve
month periods beginning, in each case, not later than the
first day of the Company's fiscal quarter next following the
"effective date" (as defined in Rule 158 under the Securities
Act) of the Registration Statement with respect to each sale
of Notes. If such fiscal quarter is the last fiscal quarter
of the Company's fiscal year, such earning statement shall be
made available not later than 90 days after the close of the
period covered thereby and in all other cases shall be made
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available not later than 45 days after the close of the
period covered thereby.
(d) The Company will furnish to each Agent,
without charge, a signed copy of the Registration Statement,
including exhibits and all amendments thereto, and as many
copies of the Prospectus, any documents incorporated by
reference therein and any supplements and amendments thereto
as such Agent may reasonably request.
(e) The Company will endeavor to qualify the Notes
for offer and sale under the securities or Blue Sky laws of
such jurisdictions as the Agents shall reasonably request and
to maintain such qualification for as long as the Agents
shall reasonably request.
(f) The Company shall furnish to the Agents such
relevant documents and certificates of officers of the
Company relating to the business, operations and affairs of
the Company, the Registration Statement, the Basic
Prospectus, any amendments or supplements thereto, the
Indentures, the Notes, this Agreement, the Administrative
Procedures, any Terms Agreement and the performance by the
Company of its obligations hereunder or thereunder as the
Agents may from time to time reasonably request.
(g) The Company shall notify the Agents promptly
in writing of any downgrading, or of its receipt of any
notice of any intended or potential downgrading or of any
review for possible change that does not indicate the
direction of the possible change, in the rating accorded any
of the Company's securities by any "nationally recognized
statistical rating organization," as such term is defined for
purposes of Rule 436(g)(2) under the Securities Act.
(h) The Company will, whether or not any sale of
Notes is consummated, pay all expenses incident to the
performance of its obligations under this Agreement and any
Terms Agreement, including: (i) the preparation and filing
of the Registration Statement and the Prospectus and all
amendments and supplements thereto, (ii) the preparation,
issuance and delivery of the Notes, (iii) the fees and
disbursements of the Company's counsel and accountants and of
the Trustee and its counsel, (iv) the qualification of the
Notes under securities or Blue Sky laws in accordance with
the provisions of Section 3(e), including filing fees and the
fees and disbursements of counsel for the Agents in
connection therewith and in connection with the preparation
of any Blue Sky or Legal Investment Memoranda, (v) the
printing and delivery to the Agents in quantities as
hereinabove stated of copies of the Registration Statement
and all amendments thereto and of the Prospectus and any
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amendments or supplements thereto, (vi) the printing and
delivery to the Agents of copies of any Blue Sky or Legal
Investment Memoranda, (vii) any fees charged by rating
agencies for the rating of the Notes, (viii) the fees and
expenses, if any, incurred with respect to any filing with
the National Association of Securities Dealers, Inc.,
(ix) the reasonable fees and disbursements of counsel for the
Agents incurred in connection with the offering and sale of
the Notes, including any opinions to be rendered by such
counsel hereunder, and (x) any reasonable out-of-pocket
expenses incurred by the Agents; provided that any
advertising expenses incurred by the Agents shall have been
approved by the Company.
(i) Between the date of any Terms Agreement and
the Settlement Date with respect to such Terms Agreement, the
Company will not, without the prior consent of the Agent
under such Term Agreement, offer, sell, contract to sell or
otherwise dispose of any debt securities of the Company
substantially similar to the Notes that are to be sold
pursuant to such Terms Agreement (other than (i) such Notes,
(ii) Notes previously agreed to be sold by the Company and
(iii) commercial paper issued in the ordinary course of
business), except as may otherwise be provided in such Terms
Agreement.
4. Conditions of the Obligations of the Agents.
Each Agent's obligation to solicit offers to purchase Notes
as agent of the Company, each Agent's obligation to purchase
Notes pursuant to any Terms Agreement and the obligation of
any other purchaser to purchase Notes will be subject to the
accuracy of the representations and warranties on the part of
the Company herein, 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 an Agent's obligation to solicit offers to
purchase Notes, at the time of such solicitation, and, in the
case of an 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 issuance and delivery)
and (in each case) to the following additional conditions
precedent when and as specified:
(a) Prior to such solicitation or purchase, as the
case may be:
(i) there shall not have occurred any change, or
any development which could reasonably be expected to
result in a change, in the condition, financial or
otherwise, or in the earnings, business or operations of
-13-
the Company and its subsidiaries, taken as a whole, from
that set forth in the Prospectus, as amended or
supplemented at the time of such solicitation or at the
time such offer to purchase was made, that, in the
judgment of the relevant Agent, is material and adverse
and that makes it, in the judgment of such Agent,
impracticable to market the Notes on the terms and in
the manner contemplated by the Prospectus, as so amended
or supplemented;
(ii) there shall not have occurred any
(A) suspension or material limitation of trading
generally on or by, as the case may be, the New York
Stock Exchange, the American Stock Exchange or the
National Association of Securities Dealers, Inc.,
(B) suspension of trading of any securities of the
Company on any exchange or in any over-the-counter
market, (C) declaration of a general moratorium on
commercial banking activities in New York by either
Federal or New York State authorities or (D) any
outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis that, in the
judgment of the relevant Agent, is material and adverse
and, in the case of any of the events described in
clauses (ii)(A) through (D), such event, singly or
together with any other such event, makes it, in the
judgment of such Agent, impracticable to market the
Notes on the terms and in the manner contemplated by the
Prospectus, as amended or supplemented at the time of
such solicitation or at the time such offer to purchase
was made; and
(iii) there shall not have occurred any downgrading,
nor shall any notice have been given of any intended or
potential downgrading or of any review for a possible
change that does not indicate the direction of the
possible change, in the rating accorded any of the
Company's securities by any "nationally recognized
statistical rating organization," as such term is
defined for purposes of Rule 436(g)(2) under the
Securities Act;
(A) except, in each case described in paragraph (i), (ii) or
(iii) above, as disclosed to the relevant Agent in writing by
the Company prior to such solicitation or, in the case of a
purchase of Notes, as disclosed to the relevant Agent before
the offer to purchase such Notes was made or (B) unless in
each case described in (ii) above, the relevant event shall
have occurred and been known to the relevant Agent before
such solicitation or, in the case of a purchase of Notes,
before the offer to purchase such Notes was made.
-14-
(b) On the Commencement Date and, if called for by
any Terms Agreement, on the corresponding Settlement Date,
the relevant Agents shall have received:
(i) The opinion, dated as of such date, of Howard,
Rice, Nemerovski, Canady, Xxxx & Xxxxxx, A Professional
Corporation, counsel for the Company to the effect that:
(A) Xxxxxxx Xxxxxx is a duly incorporated,
validly existing corporation in good standing under
the laws of the jurisdiction of its incorporation
and has the corporate power and authority to own
its property and conduct its business as described
in the Prospectus, as then amended or supplemented;
(B) each of this Agreement and any applicable
Written Terms Agreement has been duly authorized,
executed and delivered by the Company;
(C) each Indenture has been duly qualified
under the Trust Indenture Act and has been duly
authorized, executed and delivered by the Company
and is a valid and binding agreement of the
Company, enforceable in accordance with its terms;
(D) the forms of Notes have been duly
authorized and, if executed and authenticated in
accordance with the provisions of the relevant
Indenture and delivered to and duly paid for by the
purchasers thereof on the date of such opinion, the
Notes would be entitled to the benefits of such
Indenture and would be valid and binding
obligations of the Company, enforceable in
accordance with their respective terms;
(E) (1) the execution and delivery by the
Company of this Agreement, the Indentures and any
applicable Written Terms Agreement, and the
performance by the Company of its obligations under
this Agreement, the Indentures and any applicable
Terms Agreement, as of the Commencement Date (or
Settlement Date, if applicable) did not contravene,
and (2) the execution and delivery by the Company
of the Notes, assuming such Notes were executed,
issued and delivered in accordance with this
Agreement and the Indentures as of the Commencement
Date (or Settlement Date, if applicable) would not
contravene, (a) any provision of applicable law
(other than the securities or Blue Sky laws of the
various states as to which such counsel need
express no opinion), or (b) the certificate of
incorporation or by-laws of the Company or Xxxxxxx
-15-
Schwab, or constitute a default under any of
(i) the Revolving Subordinated Loan Agreement as of
September 29, 1988, as amended, between the Company
and Schwab; (ii) the Revolving Subordinated Loan
Agreement dated as of December 10, 1991 between M&S
and the Company; (iii) the Credit Agreement dated
as of June 29, 1995, between the Company and the
Banks listed therein; and (iv) the Reimbursement
Agreement dated December 19, 1994, as amended
July 31, 1995, and Irrevocable Standby Letter of
Credit numbered LASB-222-63-0 dated as of
December 19, 1994; or to the best knowledge of such
counsel, after reasonable investigation, any other
instrument or agreement binding upon the Company or
any subsidiary evidencing or related to
indebtedness for borrowed money, except such
instruments and other agreements relating to
capitalized lease obligations and installment
purchase agreements for the acquisition of fixed
assets for which indebtedness does not in the
aggregate exceed $5 million; and no consent,
approval, authorization or order of, or
qualification with, any governmental body or agency
is required for the performance by the Company of
its obligations under this Agreement, the Notes
(assuming such Notes were executed, issued and
delivered in accordance with this Agreement and the
Indentures as of the Commencement Date or
Settlement Date, if applicable), the Indentures and
any applicable Terms Agreement, or for the
performance by Xxxxxxx Xxxxxx of its obligations
under this Agreement and any applicable Terms
Agreement, except such as are specified and have
been obtained, and such as may be required by the
securities or Blue Sky laws of the various states
in connection with the offer and sale of the Notes;
(F) the statements (1) in the Prospectus, as
then amended or supplemented, under the captions
"Description of Notes" (in the Prospectus
Supplement), "Description of Debt Securities" (in
the Basic Prospectus), "Plan of Distribution" (in
the Prospectus Supplement and in the Basic
Prospectus), and (2) in the Registration Statement,
as then amended or supplemented, under Item 15, in
each case insofar as such statements constitute
summaries of the legal matters, documents or
proceedings referred to therein, fairly present the
information called for with respect to such legal
matters, documents and proceedings and fairly
summarize the matters referred to therein;
-16-
(G) such counsel is of the opinion ascribed
to it in the Prospectus, as then amended or
supplemented, under the caption "Certain United
States Federal Income Tax Consequences";
(H) (1) such counsel is of the opinion that
each document, if any, filed by the Company
pursuant to the Exchange Act and incorporated by
reference in the Prospectus, as then amended or
supplemented (except for financial statements and
schedules and other financial and statistical data
included therein, and except for any proxy
statement of the Company, as to which such counsel
need not express any opinion), complied when so
filed as to form in all material respects with the
Exchange Act and the applicable rules and
regulations of the Commission thereunder, (2) no
facts have come to the attention of such counsel to
lead them to believe that (except for financial
statements and schedules and other financial and
statistical data as to which such counsel need not
express any belief and except for that part of the
Registration Statement that constitutes the Form
T-1 heretofore referred to and except for any proxy
statement of the Company) any part of the
Registration Statement, as then amended, if
applicable, as of the date such opinion is
delivered, contains any untrue statement of a
material fact or omits to state a material fact
required to be stated therein or necessary to make
the statements therein not misleading, (3) such
counsel is of the opinion that the Registration
Statement and Prospectus, as then amended or
supplemented, if applicable (except for financial
statements and schedules and other financial and
statistical data included therein and except for
any proxy statement of the Company, as to which
such counsel need not express any opinion) comply
as to form in all material respects with the
Securities Act and the applicable rules and
regulations of the Commission thereunder and (4) no
facts have come to the attention of such counsel to
lead them to believe that (except for financial
statements and schedules and other financial and
statistical data and except for any proxy statement
of the Company, as to which such counsel need not
express any belief) the Prospectus, as then amended
or supplemented, if applicable, as of the date such
opinion is delivered, contains any untrue statement
of a material fact or omits to state a material
fact necessary in order to make the statements
therein, in the light of the circumstances under
-17-
which they were made, not misleading; provided that
in the case of an opinion delivered on the
Commencement Date or pursuant to Section 5(b), the
opinion and belief set forth in clauses (3) and (4)
above shall be deemed not to cover information
concerning an offering of particular Notes to the
extent such information will be set forth in a
supplement to the Basic Prospectus.
(ii) The opinion, dated as of such date, of Xxxx X.
Xxxxxxxxx, General Counsel of the Company to the effect
that:
(A) the Company is a duly incorporated,
validly existing corporation in good standing under
the laws of the State of Delaware, has the
corporate power and authority to own its property
and conduct its business as described in the
Prospectus, as then amended or supplemented, and is
duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct
of its business or its ownership or leasing of
property requires such qualification, except to the
extent that the failure to be so qualified or be in
good standing would not have a material adverse
effect on the Company and its subsidiaries, taken
as a whole;
(B) each of Holdings and M&S is a duly
incorporated, validly existing corporation in good
standing under the laws of the jurisdiction of its
incorporation and has the corporate power and
authority to own its property and conduct its
business as described in the Prospectus, as then
amended or supplemented; and each Significant
Subsidiary is duly qualified to transact business
and is in good standing in each jurisdiction in
which the conduct of its business or its ownership
or leasing of property requires such qualification,
except to the extent that the failure to be so
qualified or be in good standing would not have a
material adverse effect on the Company and its
subsidiaries, taken as a whole;
(C) each of the Company and its Significant
Subsidiaries has all necessary consents,
authorizations, approvals, orders, certificates and
permits of and from, and has made all declarations
and filings with, all federal, state, local and
other governmental authorities, all self-regulatory
organizations and all courts and other tribunals,
to own, lease, license and use its properties and
-18-
assets and to conduct its business in the manner
described in the Prospectus, as amended or
supplemented, except to the extent that the failure
to obtain or file would not have a material adverse
effect on the Company and its consolidated
subsidiaries, taken as a whole;
(D) the statements (1) in "Item 3 - Legal
Proceedings" of the Company's most recent annual
report on Form 10-K incorporated by reference in
the Prospectus, as then amended or supplemented and
(2) in "Item 1 - Legal Proceedings" of Part II of
the Company's quarterly reports on Form 10-Q, if
any, filed since such annual report, and (3) under
the caption "Employment Agreement and Name
Assignment" in the Company's Proxy Statement for
its Annual Meeting of Stockholders immediately
succeeding the filing of the Company's most recent
annual report on Form 10-K incorporated by
reference in the Prospectus, in each case insofar
as such statements constitute summaries of the
legal matters, documents or proceedings referred to
therein, fairly present the information called for
with respect to such legal matters, documents and
proceedings and fairly summarize the matters
referred to therein;
(E) after due inquiry, such counsel does not
know of any contracts or other documents that are
required to be described in the Registration
Statement or the Prospectus, as then amended or
supplemented, or to be filed or incorporated by
reference as exhibits to such Registration
Statement that are not described, filed or
incorporated as required;
(F) each of the Company and its Significant
Subsidiaries is duly registered as a broker-dealer,
municipal securities broker or dealer, investment
adviser, or transfer agent, as the case may be, in
each jurisdiction wherein the conduct of its
business requires such registration, and each of
the Company and its Significant Subsidiaries is in
compliance in all material respects with all
applicable laws, rules, regulations, orders, by-
laws and similar requirements in connection with
such registrations, except to the extent that the
failure to be so registered or be in compliance
would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole;
-19-
(G) Xxxxxxx Xxxxxx is a member in good
standing of the associations and exchanges
indicated in the Prospectus, as then amended or
supplemented, and is registered as a broker-dealer
with the Commission and in all 50 states, the
District of Columbia and Puerto Rico, except to the
extent that the failure to be in good standing or
be so registered would not have a material adverse
effect on the Company and its subsidiaries, taken
as a whole; and
(H) M&S is a member in good standing of the
associations and exchanges, and is registered as a
broker-dealer with the Commission and in each
jurisdiction, indicated in the Prospectus, as then
amended or supplemented, except to the extent that
the failure to be in good standing or be so
registered would not have a material adverse effect
on the Company and its subsidiaries, taken as a
whole.
(I) (1) the execution and delivery by the
Company of the Agreement, the Indentures and any
applicable Written Terms Agreement, and the
performance by the Company of its obligations under
the Agreement, the Indentures and any applicable
Terms Agreement, as of the Commencement Date (or
Settlement Date, if applicable), did not violate,
and (2) the execution and delivery by the Company
of the Notes, assuming such Notes were executed,
issued and delivered in accordance with this
Agreement and the Indentures as of the Commencement
Date (or Settlement Date, if applicable), would not
violate, to such counsel's best knowledge, after
reasonable investigation, any judgment, order or
decree of any governmental body, agency or court
having jurisdiction over the Company or any
subsidiary (except for such contravention that
would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole).
(J) After due inquiry, such counsel does not
know of any legal or governmental proceedings
pending or threatened to which the Company or any
of its subsidiaries is a party or to which any of
the properties of the Company or any of its
subsidiaries is subject that are required to be
described in the Registration Statement or the
Prospectus, as then amended or supplemented, and
are not so described or of any statutes or
regulations that are required to be described in
the Registration Statement or the Prospectus, as
-20-
then amended or supplemented, that are not
described as required.
(K) (1) Such counsel is of the opinion that
the proxy statement most recently filed by the
Company pursuant to the Exchange Act and
incorporated by reference in the Prospectus, as
then amended or supplemented, (except for financial
statements and schedules and other financial and
statistical data included therein, as to which such
counsel need not express an opinion), complied when
so filed as to form in all material respects with
the Exchange Act and the applicable rules and
regulations of the Commission thereunder, (2) no
facts have come to the attention of such counsel to
lead them to believe that (except for financial
statements and schedules and other financial and
statistical data, as to which such counsel need not
express any belief) the proxy statement most
recently filed pursuant to the Exchange Act by the
Company and incorporated by reference in the
Prospectus, when such part of Registration
Statement became effective, and as of the date such
opinion is delivered, contained any untrue
statement of a material fact or omitted to state a
material fact required to be stated therein or
necessary to make the statements therein not
misleading.
(iii) The opinion, dated as of such date, of Xxxxx
Xxxx & Xxxxxxxx, counsel for the Agents, covering the
matters in subparagraphs (B), (C), (D) and (F) (with
respect to statements in the Prospectus, as then amended
or supplemented, under the captions "Description of
Notes" (in the Prospectus Supplement), "Description of
Debt Securities" (in the Basic Prospectus) and "Plan of
Distribution" (in the Prospectus Supplement and in the
Basic Prospectus)), and clauses (2), (3) and (4) of
subparagraph (H) in paragraph (b)(i) above.
In giving the opinions referred to in paragraph (i)
hereof, Howard, Rice, Nemerovski, Canady, Xxxx & Rabkin,
A Professional Corporation, may rely on the opinion of
Xxxxx Xxxx & Xxxxxxxx as to any matters governed by the
laws of New York, and in giving the opinion referred to
in paragraph (iii) hereof, Xxxxx Xxxx & Xxxxxxxx may
rely on the opinion of Howard, Rice, Nemerovski, Canady,
Xxxx & Rabkin, A Professional Corporation, as to any
matters governed by laws of California. With respect to
subparagraph (H) of paragraph (b)(i) above, Howard,
Rice, Nemerovski, Canady, Xxxx & Xxxxxx, A Professional
Corporation, may state that their opinion and belief are
-21-
based upon their participation in the preparation of the
Registration Statement and Prospectus and any amendments
or supplements thereto (but not including documents
incorporated therein by reference) and review and
discussion of the contents thereof (including documents
incorporated therein by reference), but are without
independent check or verification, except as specified.
With respect to clauses (2), (3) and (4) of
subparagraph (H) of paragraph (b)(i) above, Xxxxx Xxxx &
Xxxxxxxx may state that their opinion and belief are
based upon their participation in the preparation of the
Registration Statement and Prospectus and any amendments
or supplements thereto (but not including documents
incorporated therein by reference) and review and
discussion of the contents thereof (including documents
incorporated therein by reference), but are without
independent check or verification, except as specified.
The opinion of Howard, Rice, Nemerovski, Canady,
Xxxx & Rabkin, A Professional Corporation, described in
paragraph (b)(i) above shall be rendered to the Agents
at the request of the Company and shall so state
therein.
The opinion of Xxxx X. Xxxxxxxxx described in
paragraph (b)(ii) above shall be rendered to the Agents
at the request of the Company and shall so state
therein.
(c) On the Commencement Date and, if called for by
any Terms Agreement, on the corresponding Settlement Date,
the relevant Agents shall have received a certificate, dated
the Commencement Date or such Settlement Date, as the case
may be, signed by an executive officer of the Company to the
effect set forth in subparagraph (a)(iii) above and to the
effect that the representations and warranties of the Company
contained herein are true and correct as of such date and
that the Company has complied with all of the agreements and
satisfied all of the conditions on its part to be performed
or satisfied on or before such date.
The officer signing and delivering such certificate
may rely upon the best of his or her knowledge as to
proceedings threatened.
(d) On the Commencement Date and, if called for by
any Terms Agreement, on the corresponding Settlement Date,
the Company's independent auditors shall have furnished to
the relevant Agents a letter or letters, dated as of the
Commencement Date or such Settlement Date, as the case may
be, in form and substance satisfactory to such Agents
containing statements and information of the type ordinarily
-22-
included in accountant's "comfort letters" to underwriters
with respect to the financial statements and certain
financial information contained in or incorporated by
reference into the Prospectus, as then amended or
supplemented.
(e) On the Commencement Date and on each
Settlement Date, the Company shall have furnished to the
relevant Agents such appropriate further information,
certificates and documents as they may reasonably request.
5. Additional Agreements of the Company.
(a) Each time the Registration Statement or
Prospectus is amended or supplemented (other than by an
amendment or supplement providing solely for a change in the
interest rates, redemption provisions, amortization schedules
or maturities offered on the Notes or for a change the Agents
deem to be immaterial), the Company will deliver or cause to
be delivered forthwith to each Agent a certificate signed by
an executive officer of the Company, dated the date of such
amendment or supplement, as the case may be, in form
reasonably satisfactory to the Agents, of the same tenor as
the certificate referred to in Section 4(c) relating to the
Registration Statement or the Prospectus as amended or
supplemented to the time of delivery of such certificate.
(b) Each time the Company furnishes a certificate
pursuant to Section 5(a), the Company will furnish or cause
to be furnished forthwith to each Agent written opinions of
(i) independent counsel for the Company and (ii) the General
Counsel for the Company. All such opinions shall be dated
the date of such amendment or supplement, as the case may be,
shall be in a form satisfactory to the Agents and shall be of
the same tenor as the opinions referred to in Sections
4(b)(i) and (ii), but modified to relate to the Registration
Statement and the Prospectus as amended and supplemented to
the time of delivery of such opinions. In lieu of such
opinions, counsel last furnishing such an opinions to an
Agent may furnish to each Agent a letter to the effect that
such Agent may rely on such last opinions to the same extent
as though it were dated the date of such letter (except that
statements in such last opinions will be deemed to relate to
the Registration Statement and the Prospectus as amended or
supplemented to the time of delivery of such letter.)
(c) Each time the Registration Statement or the
Prospectus is amended or supplemented to set forth amended or
supplemental financial information or such amended or
supplemental information is incorporated by reference in the
Prospectus, the Company shall cause its independent public
accountants forthwith to furnish each Agent with a letter,
-23-
dated the date of such amendment or supplement, as the case
may be, in form satisfactory to the Agents, of the same tenor
as the letter referred to in Section 4(d), with regard to the
amended or supplemental financial information included or
incorporated by reference in the Registration Statement or
the Prospectus as amended or supplemented to the date of such
letter.
6. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold
harmless each Agent and each person, if any, who controls
such Agent within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act from and
against any and all losses, claims, damages and liabilities
(including, without limitation, any legal or other expenses
reasonably incurred by any Agent or any such controlling
person in connection with investigating or defending any such
action or claim) caused by any untrue statement or alleged
untrue statement of a material fact contained in the
Registration Statement or any amendment thereof or the
Prospectus (as amended or supplemented if the Company shall
have furnished any amendments or supplements thereto), or
caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar as
such losses, claims, damages or liabilities are caused by any
such untrue statement or omission or alleged untrue statement
or omission based upon information relating to such Agent
furnished to the Company in writing by such Agent expressly
for use therein.
(b) Each Agent agrees, severally and not jointly,
to indemnify and hold harmless the Company, its directors,
its officers who sign the Registration Statement and each
person, if any, who controls the Company within the meaning
of either Section 15 of the Securities Act or Section 20 of
the Exchange Act to the same extent as the foregoing
indemnity from the Company to such Agent, but only with
reference to information relating to such Agent furnished to
the Company in writing by such Agent expressly for use in the
Registration Statement or the Prospectus or any amendments or
supplements thereto.
(c) In case any proceeding (including any
governmental investigation) shall be instituted involving any
person in respect of which indemnity may be sought pursuant
to either paragraph (a) or (b) above, such person (the
"indemnified party") shall promptly notify the person against
whom such indemnity may be sought (the "indemnifying party")
in writing and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably
-24-
satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may
designate in such proceeding and shall pay the fees and
disbursements of such counsel related to such proceeding. In
any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of
such counsel shall be at the expense of such indemnified
party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding
(including any impleaded parties) include both the
indemnifying party and the indemnified party and
representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests
between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for
the fees and expenses of more than one separate firm (in
addition to any local counsel) for all such indemnified
parties and that all such fees and expenses shall be
reimbursed as they are incurred. Such firm shall be
designated in writing by Xxxxxx Xxxxxxx or, if Xxxxxx Xxxxxxx
is not an indemnified party and is not reasonably likely to
become an indemnified party, by the Agents that are
indemnified parties, in the case of parties indemnified
pursuant to paragraph (a) above, and by the Company, in the
case of parties indemnified pursuant to paragraph (b) above.
The indemnifying party shall not be liable for any settlement
of any proceeding effected without its written consent, but
if settled with such consent or if there be a final judgment
for the plaintiff, the indemnifying party agrees to indemnify
the indemnified party from and against any loss or liability
by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an indemnified party
shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as
contemplated by the second and third sentences of this
paragraph, the indemnifying party agrees that it shall be
liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into
more than 30 days after receipt by such indemnifying party of
the aforesaid request and (ii) such indemnifying party shall
not have reimbursed the indemnified party in accordance with
such request prior to the date of such settlement. No
indemnifying party shall, without the prior written consent
of the indemnified party, effect any settlement of any
pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity
could have been sought hereunder by such indemnified party,
unless such settlement includes an unconditional release of
-25-
such indemnified party from all liability on claims that are
the subject matter of such proceeding.
(d) To the extent the indemnification provided for
in paragraph (a) or (b) of this Section 6 is unavailable to
an indemnified party or insufficient in respect of any
losses, claims, damages or liabilities referred to therein in
connection with any offering of Notes, then each indemnifying
party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount
paid or payable by such indemnified party as a result of such
losses, claims, damages or liabilities (i) in such proportion
as is appropriate to reflect the relative benefits received
by the Company on the one hand and each Agent on the other
hand from the offering of such Notes or (ii) if the
allocation provided by clause (i) is not permitted by
applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in
clause (i) above but also the relative fault of the Company
on the one hand and each Agent on the other hand in
connection with the statements or omissions that 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 each
Agent on the other hand in connection with the offering of
such Notes shall be deemed to be in the same respective
proportions as the total net proceeds from the offering of
such Notes (before deducting expenses) received by the
Company bear to the total discounts and commissions received
by each Agent in respect thereof. The relative fault of the
Company on the one hand and of each Agent on the other hand
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 by
such Agent and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent
such statement or omission. Each Agent's obligation to
contribute pursuant to this Section 6 shall be several (in
the proportion that the principal amount of the Notes the
sale of which by or through such Agent gave rise to such
losses, claims, damages or liabilities bears to the aggregate
principal amount of the Notes the sale of which by or through
any Agent gave rise to such losses, claims, damages or
liabilities) and not joint.
(e) The Company and the Agents agree that it would
not be just or equitable if contribution pursuant to this
Section 6 were determined by pro rata allocation (even if the
Agents were treated as one entity for such purpose) or by any
other method of allocation that does not take account of the
equitable considerations referred to in paragraph (d) above.
-26-
The amount paid or payable by an indemnified party as a
result of the losses, claims, damages and liabilities
referred to in paragraph (d) above shall be deemed to
include, subject to the limitations set forth above, any
legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the
provisions of this Section 6, no Agent shall be required to
contribute any amount in excess of the amount by which the
total price at which the Notes referred to in paragraph (d)
above that were offered and sold to the public through such
Agent exceeds the amount of any damages that such Agent has
otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The remedies provided
for in this Section 6 are not exclusive and shall not limit
any rights or remedies which may otherwise be available to
any indemnified party at law or in equity.
7. Position of the Agents. In acting under this
Agreement and in connection with the sale of any Notes by the
Company (other than Notes sold to an Agent as principal
pursuant to a Terms Agreement), each Agent is acting solely
as agent of the Company and does not assume any obligation
towards or relationship of agency or trust with any purchaser
of Notes. An Agent shall make reasonable efforts to assist
the Company in obtaining performance by each purchaser whose
offer to purchase Notes has been solicited by such Agent and
accepted by the Company, but such Agent shall not have any
liability to the Company in the event any such purchase is
not consummated for any reason. If the Company shall default
in its obligations to deliver Notes to a purchaser whose
offer it has accepted, the Company shall hold the relevant
Agent harmless against any loss, claim, damage or liability
arising from or as a result of such default and shall, in
particular, pay to such Agent the commission it would have
received had such sale been consummated.
8. Termination. This Agreement may be terminated
at any time by the Company or, as to any Agent, by the
Company or such Agent upon the giving of written notice of
such termination to the other parties hereto, but without
prejudice to any rights, obligations or liabilities of any
party hereto accrued or incurred prior to such termination.
The termination of this Agreement shall not require
termination of any Terms Agreement, and the termination of
any such Terms Agreement shall not require termination of
this Agreement. If this Agreement is terminated, the
provisions of the third paragraph of Section 2(a),
-27-
Section 2(e), the last sentence of Section 3(b) and
Sections 3(c), 3(h), 6, 7, 9, 11 and 14 shall survive;
provided that if at the time of termination an offer to
purchase Notes has been accepted by the Company but the time
of delivery to the purchaser or its agent of such Notes has
not occurred, the provisions of Sections 2(b), 2(c), 3(a),
3(e), 3(f), 3(g), 3(i), 4 and 5 shall also survive until such
delivery has been made.
9. Representations and Indemnities to Survive.
The respective indemnity and contribution agreements,
representations, warranties and other statements of the
Company, its officers and the Agents set forth in or made
pursuant to this Agreement or any Terms Agreement will remain
in full force and effect, regardless of any termination of
this Agreement or any such Terms Agreement, any investigation
made by or on behalf of an Agent or the Company or any of the
officers, directors or controlling persons referred to in
Section 6 and delivery of and payment for the Notes.
10. Notices. All communications hereunder will be
in writing and effective only on receipt, and, if sent to
Xxxxxx Xxxxxxx, will be mailed, delivered or telefaxed and
confirmed to Xxxxxx Xxxxxxx at 0000 Xxxxxx xx xxx Xxxxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Manager, Credit
Department (telefax number: 212-703-4575), with a copy to
0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Managing Director, Debt Syndicate (telefax
number: 212-764-7490), if sent to Goldman, Sachs, will be
mailed, delivered or telefaxed and confirmed to Xxxxxxx,
Sachs at 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Credit Department, Medium-Term Notes (telefax
number 212-357-8680), if sent to Xxxxxxx Xxxxxx, will be
mailed, delivered or telefaxed and confirmed to Xxxxxxx
Xxxxxx at 000 Xxxxxxxxxx Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx
00000, Attention: Chief Financial Officer (telefax number:
415-627-8894) or, if sent to the Company, will be mailed,
delivered or telefaxed and confirmed to the Company at 000
Xxxxxxxxxx Xxxxxx, Xxx Xxxxxxxxx, Xxxxxxxxxx 00000,
Attention: Chief Financial Officer.
11. Successors. This Agreement and any Terms
Agreement will inure to the benefit of and be binding upon
the parties hereto and their respective successors and the
officers, directors and controlling persons referred to in
Section 6 and the purchasers of Notes (to the extent
expressly provided in Section 4), and no other person will
have any right or obligation hereunder.
12. Amendments. This Agreement may be amended or
supplemented if, but only if, such amendment or supplement is
in writing and is signed by the Company and each Agent;
-28-
provided that the Company may from time to time, on seven
days prior written notice to the Agents but without the
consent of any Agent, amend this Agreement to add as a party
hereto one or more additional firms registered under the
Exchange Act, whereupon each such firm shall become an Agent
hereunder on the same terms and conditions as the other
Agents that are parties hereto. The Agents shall sign any
amendment or supplement giving effect to the addition of any
such firm as an Agent under this Agreement.
13. Counterparts. This Agreement may be signed in
any number of counterparts, each of which shall be an
original, with the same effect as if the signatures thereto
and hereto were upon the same instrument.
14. Applicable Law. This Agreement shall be
governed by and construed in accordance with the internal
laws of the State of New York.
15. Headings. The headings of the sections of
this Agreement have been inserted for convenience of
reference only and shall not be deemed a part of this
Agreement.
-29-
If the foregoing is in accordance with your
understanding of our agreement, please sign and return to us
the enclosed duplicate hereof, whereupon this letter and your
acceptance shall represent a binding agreement between the
Company and each of you.
Very truly yours,
THE XXXXXXX XXXXXX CORPORATION
By /s/ Xxxxxxxxxxx X. Xxxxx
____________________________
Title: Senior Vice President
and Treasurer
The foregoing Agreement
is hereby confirmed
and accepted as of the
date first above written.
XXXXXX XXXXXXX & CO. INCORPORATED
By /s/ Xxxxx X. Xxxxxxxx
______________________________
Title: Principal
By /s/ Xxxxxxx, Xxxxx & Co.
______________________________
Xxxxxxx, Sachs & Co.
XXXXXXX XXXXXX & CO., INC.
By /s/ Xxxxxxxxxxx X. Xxxxx
______________________________
Title: Treasurer
-30-
EXHIBIT A
THE XXXXXXX XXXXXX CORPORATION
MEDIUM-TERM NOTES, SERIES A
TERMS AGREEMENT
_________________, 19__
The Xxxxxxx Xxxxxx Corporation
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention:
Re: Distribution Agreement dated September 25,
1995 (the "Distribution Agreement")
We agree to purchase your Medium-Term Notes,
Series A, having the following terms:
[We agree to purchase, severally and not
jointly, the principal amount of Notes set forth below
opposite our names:
Principal Amount
Name of Notes
Xxxxxx Xxxxxxx & Co.
Incorporated
Xxxxxxx, Sachs & Co.
Xxxxxxx Xxxxxx & Co., Inc.
Total . . . . $
===========
The Notes shall have the following terms:]*
* Delete if the transaction will not be syndicated.
-1-
Floating
Fixed Rate Rate
All Notes: Notes: Notes:
Principal Interest Base Rate:
Amount: Rate:
Index
Purchase Amortization Maturity:
Price: Schedule:
Spread (Plus or
Price to Applicability Minus):
Public: of Annual
Interest Spread
Settlement Payments: Multiplier:
Date and Time:
Interest Payment
Place of Date(s):
Delivery:
Initial Interest
Original Issue Rate:
Date:
Initial Interest
Interest Accrual Reset Date:
Date:
Interest Reset
Maturity Dates:
Date:
Interest Reset
Optional Repayment Period:
Date(s)
Maximum Interest
Optional Redemption Rate:
Date(s):
Minimum Interest
Initial Redemption Rate:
Date:
Interest Payment
Initial Redemption Period:
Percentage
Reduction: Calculation Agent:
Annual Redemption LIBOR
Percentage Reuters/Telerate:
Reduction:
-2-
Ranking:
Other Terms:
The provisions of Sections 1, 2(b) and 2(c) and 3
through 6, 9, 10, 11 and 14 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.
[If on the Settlement Date any one or more of the
Agents shall fail or refuse to purchase Notes that it has or
they have agreed to purchase on such date, and the aggregate
amount of Notes which such defaulting Agent or Agents agreed
but failed or refused to purchase is not more than one-tenth
of the aggregate amount of the Notes to be purchased on such
date, the other Agents shall be obligated severally in the
proportions that the amount of Notes set forth opposite their
respective names above bears to the aggregate amount of Notes
set forth opposite the names of all such non-defaulting
Agents, or in such other proportions as _______________ may
specify, to purchase the Notes which such defaulting Agent or
Agents agreed but failed or refused to purchase on such date;
provided that in no event shall the amount of Notes that any
Agent has agreed to purchase pursuant to this Agreement be
increased pursuant to this paragraph by an amount in excess
of one-ninth of such amount of Notes without the written
consent of such Agent. If on the Settlement Date any Agent
or Agents shall fail or refuse to purchase Notes and the
aggregate amount of Notes with respect to which such default
occurs is more than one-tenth of the aggregate amount of
Notes to be purchased on such date, and arrangements
satisfactory to _______________ and the Company for the
purchase of such Notes are not made within 36 hours after
such default, this Agreement shall terminate without
liability on the part of any non-defaulting Agent or the
Company. In any such case either _______________ or the
Company shall have the right to postpone the Settlement Date
but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and
in the Prospectus or in any other documents or arrangements
may be effected. Any action taken under this paragraph shall
not relieve any defaulting Agent from liability in respect of
any default of such Agent under this Agreement.]**
This Agreement is subject to termination on the
terms incorporated by reference herein. If this Agreement is
** Delete if the transaction will not be syndicated.
-3-
so terminated, the provisions of Sections 3(h), 6, 9, 11 and
14 of the Distribution Agreement shall survive for the
purposes of this Agreement.
The following information, opinions, certificates,
letters and documents referred to in Section 4 of the
Distribution Agreement will be required: ________________
[NAME OF RELEVANT AGENT(S)]
By ______________________________
Title:
Accepted:
THE XXXXXXX XXXXXX CORPORATION
By ___________________________
Title:
-4-
EXHIBIT B
THE XXXXXXX XXXXXX CORPORATION
MEDIUM-TERM NOTES, SERIES A
ADMINISTRATIVE PROCEDURES
_________________________________
Explained below are the administrative procedures
and specific terms of the offering of Medium-Term Notes,
Series A (the "Notes"), on a continuous basis by The Xxxxxxx
Xxxxxx Corporation (the "Company") pursuant to the
Distribution Agreement, dated as of September 25, 1995 (the
"Distribution Agreement") among the Company and Xxxxxx
Xxxxxxx & Co. Incorporated, Xxxxxxx, Sachs & Co. and Xxxxxxx
Xxxxxx & Co., Inc. (the "Agents"). The Notes may be issued
as senior indebtedness (the "Senior Notes") or senior
subordinated indebtedness (the "Senior Subordinated Notes")
of the Company, and as used herein the term "Notes" includes
the Senior Notes and the Senior Subordinated Notes. The
Senior Notes will be issued pursuant to the provisions of a
senior indenture dated as of July 15, 1993 (the "Senior Debt
Indenture"), between the Company and Chemical Bank
("Chemical"), as trustee. The Senior Subordinated Notes will
be issued pursuant to the provisions of a senior subordinated
indenture dated as of July 15, 1993 (the "Senior Subordinated
Debt Indenture"), between the Company and Chemical, as
trustee. The Senior Debt Indenture and the Senior
Subordinated Debt Indenture are sometimes hereinafter
referred to individually as an "Indenture" and collectively
as the "Indentures." In the Distribution Agreement, the
Agents have agreed to use reasonable efforts to solicit
purchases of the Notes, and the administrative procedures
explained below will govern the issuance and settlement of
any Notes sold through the Agents, as agents of the Company.
An Agent, as principal, may also purchase Notes for its own
account, and in connection with such purchase the Company and
such Agent will enter into a terms agreement (a "Terms
Agreement"), as contemplated by the Distribution Agreement.
The administrative procedures explained below will govern the
issuance and settlement of any Notes purchased by an Agent,
as principal, unless otherwise specified in the applicable
Terms Agreement.
Chemical will be the Registrar, Calculation Agent,
Authenticating Agent and Paying Agent for both the Senior
Notes and the Subordinated Notes and will perform the duties
specified herein. Each Note will be represented by either a
Global Security (as defined below) delivered to Chemical, as
agent for The Depository Trust Company ("DTC"), and recorded
in the book-entry system maintained by DTC (a "Book-Entry
Note") or a certificate delivered to the holder thereof or a
person designated by such holder (a "Certificated Note").
Except as set forth in the Indentures, an owner of a
Book-Entry Note will not be entitled to receive a
Certificated Note.
Book-Entry Notes, which may be payable only in U.S.
dollars, will be issued in accordance with the administrative
procedures set forth in Part I hereof as they may
subsequently be amended as the result of changes in DTC'S
operating procedures. 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 any Prospectus
Supplement relating to the Notes shall be used herein as
therein defined.
The Company will advise the Agents in writing of
the employees of the Company with whom the Agents are to
communicate regarding offers to purchase Notes and the
related settlement details.
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, Chemical will perform the custodial,
document control and administrative functions described
below, in accordance with its respective obligations under a
Letter of Representation from the Company and Chemical to
DTC, dated as of August 3, 1993 (the "Letter of
Representation"), as amended, and a Medium-Term Note
Certificate Agreement between Chemical and DTC, dated as of
December 2, 1988 (the "MTN Certificate Agreement") , and its
obligations as a participant in DTC, including DTC's Same-Day
Funds Settlement System ("SDFS").
B-2
Issuance: On any date of settlement (as
defined under "Settlement" below)
for one or more Book-Entry Notes,
the Company will issue a single
global security in fully registered
form without coupons (a "Global
Security") representing up to U.S.
$150,000,000 principal amount of all
such Notes that have the same
Original Issue Date, Maturity Date
and other terms. Each Global
Security will be dated and issued as
of the date of its authentication by
Chemical. Each Global Security will
bear an "Interest Accrual Date,"
which will be (i) with respect to an
original Global Security (or any
portion thereof), its original
issuance date and (ii) with respect
to any Global Security (or any
portion thereof) issued subsequently
upon exchange of a Global Security,
or in lieu of a destroyed, lost or
stolen Global Security, the most
recent Interest Payment Date to
which interest has been paid or duly
provided for on the predecessor
Global Security or Securities (or if
no such payment or provision has
been made, the original issuance
date of the predecessor Global
Security), regardless of the date of
authentication of such subsequently
issued Global Security. Book-Entry
Notes may be payable only in U.S.
dollars. No Global Security will
represent any Certificated Note.
Denominations: Book-Entry Notes will be issued in
principal amounts of U.S. $1,000 or
any amount in excess thereof that is
an integral multiple of U.S. $1,000.
Global Securities will be
denominated in principal amounts not
in excess of U.S. $150,000,000. If
one or more Book-Entry Notes having
an aggregate principal amount in
excess of $150,000,000 would, but
for the preceding sentence, be
represented by a single Global
Security, then one Global Security
will be issued to represent each
B-3
U.S. $150,000,000 principal amount
of such Book-Entry Note or Notes and
an additional Global Security will
be issued to represent any remaining
principal amount of such Book-Entry
Note or Notes. In such a case, each
of the Global Securities
representing such Book-Entry Note or
Notes shall be assigned the same
CUSIP number.
Preparation If any offer to purchase a
of Pricing Book-Entry Note is accepted by or
Supplement: on behalf of the Company, the
Company will prepare a pricing
supplement (a "Pricing Supplement")
reflecting the terms of such Note.
The Company (i) will arrange to file
10 copies (or, if participating in
the Commission's Electronic Data
Gathering, Analysis and Retrieval
system ("XXXXX"), such number of
copies as is required by the rules
and regulations of the Commission
governing XXXXX filings then in
effect) of such Pricing Supplement
with the Commission in accordance
with the applicable paragraph of
Rule 424(b) under the Act, (ii)
will, as soon as possible and in any
event not later than 11:00 A.M. on
the Business Day following the trade
date, deliver the number of copies
of such Pricing Supplement to the
relevant Agent at the address listed
below as such Agent shall request
and (iii) will, on the relevant
Agent's behalf, promptly file five
copies of such Pricing Supplement
with the National Association of
Securities Dealers, Inc. (the
"NASD"). The relevant Agent will
cause such Pricing Supplement to be
delivered to the purchaser of the
Note.
Pricing Supplements shall be
delivered as follows:
B-4
If to Xxxxxx Xxxxxxx & Co.
Incorporated, at:
Xxxxxx Xxxxxxx & Co. Incorporated
1221 Avenue of the Americas
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Medium-Term Trading Desk,
Xxxxxx Xxxxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxxx & Co. Incorporated
1251 Avenue of the Xxxxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Manager - Credit Department
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
If to Xxxxxxx, Sachs & Co., at:
Xxxxxxx, Xxxxx & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: Credit Department-
Medium-Term Notes
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
with a copy to:
In each instance that a Pricing
Supplement is prepared, the relevant
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.
Settlement: The receipt by the Company of
B-5
immediately available funds in
payment for a Book-Entry Note and
the authentication and issuance of
the Global Security representing
such Note shall constitute
"settlement" with respect to such
Note. All offers 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 next Business Day.
Settlement Settlement Procedures with regard
Procedures: to each Book-Entry Note sold by the
Company to or through an Agent
(unless otherwise specified pursuant
to a Terms Agreement and reasonably
acceptable to Chemical) shall be as
follows:
A. The relevant Agent will advise
the Company by telephone that
such Note is a Book-Entry Note
and of the following settlement
information:
1. Principal amount.
2. Maturity Date.
3. In the case of a Fixed
Rate Book-Entry Note, the
Interest Rate, whether
such Note will pay
interest annually or
semiannually and whether
such Note is an Amortizing
Note, and, if so, the
amortization schedule, or,
in the case of a Floating
Rate Book-Entry Note, the
Initial Interest Rate (if
known at such time),
Interest Payment Date(s),
Interest Payment Period,
Calculation Agent, Base
Rate (and, if LIBOR,
Reuters or Telerate),
B-6
Index Maturity, Interest
Reset Period, Initial
Interest Reset Date,
Interest Reset Dates,
Spread or Spread
Multiplier (if any),
Minimum Interest Rate (if
any) and Maximum Interest
Rate (if any).
4. Redemption or repayment
provisions (if any).
5. Ranking.
6. Settlement date and time
(Original Issue Date).
7. Interest Accrual Date.
8. Price.
9. Agent's commission (if
any) determined as
provided in the
Distribution Agreement.
10. Any other applicable
terms.
B. The Company will advise
Chemical by telephone or
electronic transmission
(confirmed in writing at any
time on the same date) of the
information set forth in
Settlement Procedure "A" above
and of the name of the
applicable Agent. The Company
will then assign a CUSIP number
to the Global Security
representing such Note and will
notify Chemical and the
relevant Agent of such CUSIP
number by telephone as soon as
practicable.
C. Chemical will enter a pending
deposit message through DTC's
Participant Terminal System,
providing the following
settlement information to DTC,
B-7
the relevant Agent and Standard
& Poor's Corporation:
1. The information set forth
in Settlement Procedure
"A".
2. The Initial Interest
Payment Date for such
Note, the number of days
by which such date
succeeds the related DTC
Record Date (which in the
case of Floating Rate
Notes which reset daily or
weekly, shall be the date
five calendar days
immediately preceding the
applicable Interest
Payment Date and, in the
case of all other Notes,
shall be the Record Date
as defined in the Note)
and, if known, the amount
of interest payable on
such Initial Interest
Payment Date.
3. The CUSIP number of the
Global Security
representing such Note.
4. Whether such Global
Security will represent
any other Book-Entry Note
(to the extent known at
such time).
5. Whether such Note is an
Amortizing Note (by an
appropriate notation in
the comments field of
DTC's Participant Terminal
System).
6. The number of Participant
accounts to be maintained
by DTC on behalf of the
relevant Agent and
Chemical.
D. Chemical will complete and
B-8
authenticate the Global
Security representing such
Note.
E. DTC will credit such Note to
Chemical's participant account
at DTC.
F. Chemical will enter an SDFS
deliver order through DTC's
Participant Terminal System
instructing DTC to (i) debit
such Note to Chemical's
participant account and credit
such Note to the relevant
Agent's participant account and
(ii) debit such Agent's
settlement account and credit
Chemical's settlement account
for an amount equal to the
price of such Note less such
Agent's commission (if any).
The entry of such a deliver
order shall constitute a
representation and warranty by
Chemical to DTC that (a) the
Global Security representing
such Book-Entry Note has been
issued and authenticated and
(b) Chemical is holding such
Global Security pursuant to the
MTN Certificate Agreement.
G. Unless the relevant Agent is
the end purchaser of such Note,
such Agent will enter an SDFS
deliver order through DTC's
Participant Terminal System
instructing DTC (i) to debit
such Note to such Agent's
participant account and credit
such Note to the participant
accounts of the Participants
with respect to such Note and
(ii) to debit the settlement
accounts of such Participants
and credit the settlement
account of such Agent for an
amount equal to the price of
such Note.
H. Transfers of funds in
accordance with SDFS deliver
B-9
orders described in Settlement
Procedures "F" and "G" will be
settled in accordance with SDFS
operating procedures in effect
on the settlement date.
I. Chemical will credit to the
account of the Company
maintained at Citibank, N.A.,
New York, New York, in
immediately available funds,
the amount transferred to
Chemical in accordance with
Settlement Procedure "F".
J. Unless the relevant Agent is
the end purchaser of such Note,
such Agent will confirm the
purchase of such Note to the
purchaser either by
transmitting to the
Participants with respect to
such Note a confirmation order
or orders through DTC's
institutional delivery system
or by mailing a written
confirmation to such purchaser.
K. Monthly, Chemical will send to
the Company a statement setting
forth the principal amount of
Notes outstanding as of that
date under the Indentures and
setting forth a brief
description of any sales of
which the Company has advised
Chemical that have not yet been
settled.
Settlement For sales by the Company of
Procedures Book-Entry Notes to or through
Timetable: an Agent (unless otherwise specified
pursuant to a Terms Agreement and
reasonably acceptable to Chemical)
for settlement on the first Business
Day after the sale date, Settlement
Procedures "A" through "J" set forth
above shall be completed as soon as
possible but not later than the
respective times in New York City
set forth below:
B-10
Settlement
Procedure Time
A 11:00 A.M. on the sale date
B 12:00 Noon on the sale date
C 2:00 P.M. on the sale date
D 9:00 A.M. on settlement date
E 10:00 A.M. on settlement date
F-G 2:00 P.M. on settlement date
H 4:45 P.M. on settlement date
I-J 5:00 P.M. on settlement date
If a sale is to be settled more
than one Business Day after the
sale date, Settlement Procedures
"A", "B" and "C" shall be completed
as soon as practicable but no later
than 11:00 A.M., 12:00 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
and 2:00 P.M., respectively, on the
first Business Day before the
settlement date. Settlement
Procedure "H" is subject to
extension in accordance with any
extension of Fedwire closing
deadlines and in the other events
specified in the SDFS operating
procedures in effect on the
settlement date.
If settlement of a Book-Entry Note
is rescheduled or cancelled,
Chemical, after receiving notice
from the Company or the relevant
Agent no later than 12:00 Noon on
the Business Day immediately
preceding the scheduled settlement
date, 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
B-11
preceding the scheduled settlement
date.
Failure If Chemical fails to enter an SDFS
to Settle: deliver order with respect to a
Book-Entry Note pursuant to
Settlement Procedure "F", Chemical
may deliver to DTC, through DTC's
Participant Terminal System, as
soon as practicable a withdrawal
message instructing DTC to debit
such Note to Chemical's participant
account, provided that Chemical's
participant account contains a
principal amount of the Global
Security representing such Note
that is at least equal to the
principal amount to be debited. If
a withdrawal message is processed
with respect to all the Book-Entry
Notes represented by a Global
Security, Chemical will xxxx such
Global Security "cancelled," make
appropriate entries in Chemical's
records and send such cancelled
Global Security to the Company.
The CUSIP number assigned to such
Global Security shall, in
accordance with the procedures of
the CUSIP Service Bureau of
Standard & Poor's Corporation, be
cancelled and not immediately
reassigned. If a withdrawal
message is processed with respect
to one or more, but not all, of the
Book-Entry Notes represented by a
Global Security, Chemical will
exchange such Global Security for
two Global Securities, one of which
shall represent such Book-Entry
Note or Notes and shall be
cancelled immediately after
issuance and the other of which
shall represent the remaining
Book-Entry Notes previously
represented by the surrendered
Global Security and shall bear the
CUSIP number of the surrendered
Global Security.
If the purchase price for any
Book-Entry Note is not timely paid
B-12
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 relevant Agent may
enter SDFS deliver orders through
DTC's Participant Terminal System
reversing the orders entered
pursuant to Settlement Procedures
"F" and "G", respectively. Upon
receipt of notice of such event,
Chemical will deliver the
withdrawal message and take the
related actions described in the
preceding paragraph.
Notwithstanding the foregoing, upon
any failure to settle with respect
to a Book-Entry Note, DTC may take
any actions in accordance with its
SDFS operating procedures then in
effect.
In the event of a failure to settle
with respect to one or more, but
not all, of the Book-Entry Notes to
have been represented by a Global
Security, Chemical will provide, in
accordance with Settlement
Procedures "D" and "F", for the
authentication and issuance of a
Global Security representing the
Book-Entry Notes to be represented
by such Global Security and will
make appropriate entries in its
records.
B-13
PART II: ADMINISTRATIVE PROCEDURES FOR CERTIFICATED NOTES
Chemical will serve as Registrar in connection
with the Certificated Notes.
Issuance: Each Certificated Note will be
dated and issued as of the date of
its authentication by Chemical.
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
issuance date of the predecessor
Certificated Note, regardless of
the date of authentication of such
subsequently issued Certificated
Note.
Preparation If any offer to purchase a Certifi-
of Pricing cated Note is accepted by or on
Supplement: behalf of the Company, the Company
will prepare a Pricing Supplement
reflecting the terms of such Note.
The Company (i) will arrange to
file 10 copies (or, if
participating in XXXXX, such number
of copies as is required by the
rules and regulations of the
Commission governing XXXXX filings
then in effect) of such Pricing
Supplement with the Commission in
accordance with the applicable
paragraph of Rule 424(b) under the
Act, (ii) will, as soon as possible
and in any event not later than
11:00 A.M. on the Business Day
following the trade date, deliver
the number of copies of such
Pricing Supplement to the relevant
Agent at the address set-forth
above as such Agent shall request
and (iii) will, on the relevant
Agent's behalf, promptly file five
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copies of such Pricing Supplement
with the NASD. The relevant Agent
will cause such Pricing Supplement
to be delivered to the purchaser of
the Note.
In each instance that a Pricing
Supplement is prepared, the
relevant 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.
Settlement: The receipt by the Company of
immediately available funds in
exchange for an authenticated
Certificated Note delivered to the
relevant Agent and such Agent's
delivery of such Note against
receipt of immediately available
funds shall constitute "settlement"
with respect to such Note. All
offers accepted by the Company will
be settled on or before the third
Business Day next succeeding the
date of acceptance pursuant to the
timetable for settlement set forth
below, unless the Company and the
purchaser agree to settlement on
another date.
Settlement Settlement Procedures with regard
Procedures: to each Certificated Note sold by
the Company to or through an Agent
(unless otherwise specified
pursuant to a Terms Agreement and
reasonably acceptable to Chemical)
shall be as follows:
A. The relevant Agent will advise
the Company by telephone that
such Note is a Certificated
Note and of the following
settlement information:
1. Name in which such Note
is to be registered
("Registered Owner").
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2. Address of the Registered
Owner and address for
payment of principal and
interest.
3. Taxpayer identification
number of the Registered
Owner (if available).
4. Principal amount.
5. Maturity Date.
6. In the case of a Fixed
Rate Certificated Note,
the Interest Rate,
whether such Note will
pay interest annually or
semiannually and whether
such Note is an
Amortizing Note and, if
so, the amortization
schedule, or, in the case
of a Floating Rate
Certificated Note, the
Initial Interest Rate (if
known at such time),
Interest Payment Date(s),
Interest Payment Period,
Calculation Agent, Base
Rate (and, if LIBOR,
Reuters or Telerate),
Index Maturity, Interest
Reset Period, Initial
Interest Reset Date,
Interest Reset Dates,
Spread or Spread
Multiplier (if any),
Minimum Interest Rate (if
any) and Maximum
Interest Rate (if any).
7. Redemption or repayment
provisions (if any).
8. Ranking.
9. Settlement date and time
(Original Issue Date).
10. Interest Accrual Date.
11. Price.
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12. Agent's commission (if
any) determined as
provided in the
Distribution Agreement.
13. Denominations.
14. Any other applicable
terms.
B. The Company will advise
Chemical by telephone or
electronic transmission
(confirmed in writing at any
time on the same date) of the
information set forth in
Settlement Procedure "A" above
and of the name of the
applicable Agent.
C. The Company will have
delivered to Chemical a
pre-printed four-ply packet
for such Note, which packet
will contain the following
documents in forms that have
been approved by the Company,
the relevant Agent and
Chemical:
1. Note with customer
confirmation.
2. Stub One - For Chemical.
3. Stub Two - For the
relevant Agent.
4. Stub Three - For the
Company.
D. Chemical will complete such
Note and authenticate such
Note and deliver it (with the
confirmation) and Stubs One
and Two to the relevant Agent
at the address set-forth
below, and such Agent will
acknowledge receipt of the
Note by stamping or otherwise
marking Stub One and returning
it to Chemical. In the event
B-17
that the instructions given by
such Agent for payment to the
account of the Company are
revoked, the Company will as
promptly as possible wire
transfer to the account of
such Agent an amount of
immediately available funds
equal to the amount of such
payment made.
Certificated Notes shall be
delivered as follows:
If to Xxxxxx Xxxxxxx & Co.
Incorporated, at:
Bank of New York
Dealer Clearance Department
0 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn.: For the Account of
Xxxxxx Xxxxxxx & Co.
Incorporated
E. Unless the relevant Agent is
the end purchaser of such
Note, such Agent will deliver
such Note (with confirmation)
to the customer against
payment in immediately
available funds. Such Agent
will obtain the acknowledgment
of receipt of such Note by
retaining Stub Two.
F. Chemical will send Stub Three
to the Company by first-class
mail. Periodically, Chemical
will also send to the Company
a statement setting forth the
principal amount of the Notes
outstanding as of that date
under each Indenture and
setting forth a brief
description of any sales of
which the Company has advised
Chemical that have not yet
been settled.
Settlement For sales by the Company of Certi-
Procedures ficated Notes to or through an
B-18
Timetable: Agent (unless otherwise specified
pursuant to a Terms Agreement and
reasonably acceptable to Chemical),
Settlement Procedures "A" through
"F" set forth above shall be
completed on or before the
respective times in New York City
set forth below:
Settlement
Procedure Time
A 2:00 P.M. on day before
settlement date
B 3:00 P.M. on day before
settlement date
C-D 2:15 P.M. on settlement
date
E 3:00 P.M. on settlement
date
F 5:00 P.M. on settlement
date
Failure If a purchaser fails to accept
to Settle: delivery of and make payment for
any Certificated Note, the relevant
Agent will notify the Company and
Chemical by telephone and return
such Note to Chemical. Upon
receipt of such notice, the Company
will immediately wire transfer to
the account of such Agent an amount
equal to the amount previously
credited thereto in respect of such
Note. Such wire transfer will be
made on the settlement date, if
possible, and in any event not
later than the Business Day
following the settlement date. If
the failure shall have occurred for
any reason other than a default by
such Agent in the performance of
its obligations hereunder and under
the Distribution Agreement, then
the Company will reimburse such
Agent or Chemical, 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,
B-19
Chemical will xxxx such Note
"cancelled," make appropriate
entries in Chemical's records and
send such Note to the Company.
B-20
