Exhibit 1.2
CATERPILLAR FINANCIAL SERVICES CORPORATION
$[______________]
POWERNOTES(R)
WITH MATURITIES OF 9 MONTHS OR MORE FROM DATE OF ISSUE
FORM OF SELLING AGENT AGREEMENT
[________ __, 20__]
[Agent Name]
[Agent Address]
[Agent Name]
[Agent Address]
----------
(R) Registered Trademark of Caterpillar Inc.
Dear Sirs:
Caterpillar Financial Services Corporation, a Delaware corporation (the
"Company"), proposes to issue and sell up to $[___________] aggregate principal
amount of its PowerNotes(R) With Maturities of 9 Months or More from Date of
Issue (the "Notes") to be issued pursuant to the provisions of an Indenture
dated as of April 15, 1985, as supplemented from time to time, between the
Company and U.S. Bank Trust National Association (formerly First Trust of New
York, National Association), which acts as Trustee (the "Indenture"). The terms
of the Notes are described in the Prospectus referred to below.
Subject to the terms and conditions contained in this Selling Agent
Agreement (the "Agreement"), the Company hereby (1) appoints you as agent of the
Company ("Agent") for the purpose of soliciting purchases of the Notes from the
Company and you hereby agree to use your reasonable best efforts to solicit
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 and in accordance
with the terms hereof, and, after consultation with [Agent Name] (the
"Purchasing Agent"), the Company reserves the right to enter into agreements
substantially identical hereto with other agents and (2) agrees that whenever
the Company determines to sell Notes pursuant to this Agreement, such Notes
shall be sold pursuant to a Terms Agreement (as defined in Section IV(b) hereof)
relating to such sale in accordance with the provisions of Section IV(b) hereof
between the Company and the Purchasing Agent with the Purchasing Agent
purchasing such Notes as principal for resale to others.
I.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement No. 333-______ relating to the Notes and
the offering
thereof, from time to time, in accordance with Rule 415 under the Securities Act
of 1933, as amended (the "Securities Act"). Such registration statement,
including all documents incorporated therein by reference, as from time to time
amended or supplemented, is referred to herein as the "Registration Statement".
The Registration Statement has been declared effective by the Commission, and
the Indenture has been qualified under the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act"). The Company has prepared or will promptly
prepare for filing with, or transmission for filing to, the Commission, pursuant
to Rule 424 under the Securities Act, a prospectus supplement (the "Prospectus
Supplement") and a prospectus (the "Base Prospectus") for the purpose of
supplying information in respect of the public offering of the Notes. The
Prospectus Supplement, together with the Base Prospectus, including all
documents incorporated therein by reference, as from time to time amended or
supplemented, and including any Pricing Supplement, are referred to herein as
the "Prospectus".
II.
Your obligations hereunder are subject to the following conditions, each
of which shall be met on such date as you and the Company shall subsequently fix
for the commencement of your obligations hereunder (the "Commencement Date"):
(a) (i) No litigation or proceeding shall be threatened or pending to
restrain or enjoin the issuance or delivery of the Notes, or which in any way
questions or affects the validity of the Notes and (ii) no stop order suspending
the effectiveness of the Registration Statement shall be in effect, and no
proceedings for such purpose shall be pending before or threatened by the
Commission and there shall have been no material adverse change not in the
ordinary course of business in the consolidated financial condition of the
Company and its subsidiaries, taken as a whole, from that set forth in the
Registration Statement and the Prospectus; and you shall have received on the
Commencement Date a certificate dated such Commencement Date and signed by an
executive officer of the Company to the foregoing effect. The officer making
such certificate may rely upon the best of his knowledge as to proceedings
threatened.
(b) You shall have received a favorable opinion of Xxxxxx, Xxxxxxxxxx &
Xxxxxxxxx LLP ("Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx"), counsel for the Company, dated
the Commencement Date, to the effect that:
(i) the Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the State of
Delaware and has the corporate power and corporate authority to own its
properties and conduct its business as described in the Prospectus;
(ii) the Indenture has been duly authorized, executed and
delivered by the Company and is a legal, valid, binding and enforceable
agreement of the Company and has been duly qualified under the Trust
Indenture Act;
(iii) the issuance and sale of the Notes has been duly
authorized and the Notes, when the terms thereof have been established
in accordance with the Indenture and when executed and authenticated in
accordance with the provisions of the Indenture and
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delivered to and paid for by the purchasers, will be entitled to the
benefits of the Indenture and will be legal, valid, binding and
enforceable obligations of the Company;
(iv) this Agreement has been duly authorized, executed and
delivered by the Company and is a legal, valid, binding and enforceable
obligation of the Company; provided, that, the opinions of Xxxxxx,
Xxxxxxxxxx & Xxxxxxxxx in (ii), (iii) and (iv) hereof are subject as to
enforcement to the laws of bankruptcy, insolvency, reorganization and
other laws of general applicability relating to or affecting creditors'
rights and to general equity principles and that rights to indemnity
hereunder may be limited by applicable law in the United States;
(v) no authorization, consent or approval of, or registration or
filing with, any United States or State of Delaware governmental or
public body or regulatory authority is required under applicable federal
law or the Delaware General Corporation Law on the part of the Company
for the issuance of the Notes in accordance with the Indenture or the
sale of the Notes in accordance with this Agreement other than the
registration of the Notes under the Securities Act, qualification of the
Indenture under the Trust Indenture Act and compliance with the
applicable state securities laws;
(vi) the execution and delivery of the Indenture, the issuance
of the Notes in accordance with the Indenture and the sale of the Notes
pursuant to this Agreement do not and will not contravene any provision
of any statute of the United States, the State of New York or the
Delaware General Corporation Law or any rule or regulation thereunder or
result in any violation by the Company of any of the terms or provisions
of the Certificate of Incorporation or Bylaws of the Company, or any
indenture, mortgage or other agreement or instrument filed as an exhibit
to the Registration Statement by which the Company is bound;
(vii) the Indenture conforms and the Notes will conform in all
material respects to the descriptions thereof in the Prospectus;
(viii) such counsel does not know of any litigation or any
governmental proceeding instituted or threatened against the Company or
any of its consolidated subsidiaries which in such counsel's opinion
would be likely to result in a judgment or decree having a material
adverse effect on the business or financial position of the Company and
its subsidiaries considered as a whole or be required to be disclosed in
the Registration Statement which is not disclosed and accurately
summarized in the Prospectus; and
(ix) Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx (1) is of the opinion that
each document, if any, filed pursuant to the Securities Exchange Act of
1934, as amended (the "Exchange Act") (except as to financial statements
contained therein, as to which Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx need not
express any opinion), and incorporated by reference in the Prospectus
complied when so filed as to form in all material respects with the
Exchange Act and the rules and regulations thereunder, (2) is of the
opinion that the Registration Statement and Prospectus, as amended or
supplemented, if applicable (except as to financial statements contained
therein, as to which Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx need
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not express any opinion), comply as to form in all material respects
with the Securities Act and the rules and regulations thereunder and (3)
has no reason to believe that (except for the financial statements
contained therein, as to which Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx need not
express any belief) the Registration Statement or the Prospectus, as
amended or supplemented, filed with the Commission pursuant to the
Securities Act together with the information incorporated therein,
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, in light of the circumstances under which they were
made, not misleading; provided, that Xxxxxx, Xxxxxxxxxx & Xxxxxxxxx may
state that its opinion with respect to this subsection (ix) is based
upon the participation by one or more of its attorneys, who participated
in the preparation of the Registration Statement and the Prospectus and
the information incorporated therein by reference and review and
discussion of the contents thereof and discussion of the answers made
and information furnished therein with such attorneys, certain officers
of the Company and its auditors, but is without independent check or
verification except as stated therein.
(c) You shall have received on the Commencement Date a letter dated the
Commencement Date from PricewaterhouseCoopers LLP, independent auditors,
containing statements and information of the type ordinarily included in
auditors' "comfort letters" to underwriters with respect to the financial
statements and certain financial information contained in or incorporated by
reference into the Registration Statement and the Prospectus relating to the
Notes.
(d) You shall have received a favorable opinion of Xxxxxx, Xxxx &
Xxxxxxxx LLP, counsel for the Agents, dated such Commencement Date, to the
effect that:
(i) the Indenture is a legal, valid, binding and enforceable
agreement of the Company and has been duly qualified under the Trust
Indenture Act;
(ii) the issuance and sale of the Notes has been duly authorized
and the Notes, when the terms thereof have been established in
accordance with the Indenture and when executed and authenticated in
accordance with the provisions of the Indenture and delivered to and
paid for by the purchasers, will be legal, valid, binding and
enforceable obligations of the Company;
(iii) this Agreement has been duly authorized, executed and
delivered by the Company; and
(iv) the Indenture conforms and the Notes will conform in all
material respects to the descriptions thereof in the Prospectus.
In addition, Xxxxxx, Xxxx & Xxxxxxxx LLP shall state that, based upon
such counsel's participation in conferences with officers and other
representatives of the Company, counsel for the Company, representatives of the
independent auditors of the Company and representatives of the Agents at which
the contents of the Registration Statement and Prospectus Supplement and related
matters were discussed, without independent verification of such contents except
as stated therein, on the basis of the foregoing, and except for the financial
statements and
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schedules and other financial and statistical data included therein and the
Statement of Eligibility on Form T-1 of the Trustee included or incorporated by
reference therein, as to which Xxxxxx, Xxxx & Xxxxxxxx LLP need not express any
opinion or belief, no facts have come to its attention that lead it to believe:
(1) that the Registration Statement, at the time it became effective, or the
Prospectus Supplement as of the date thereof and as of the date of its opinion,
were not appropriately responsive in all material respects to the requirements
of the Securities Act and the Trust Indenture Act and the applicable rules and
regulations of the Commission thereunder; or (2) (i) that the Registration
Statement, at the time it became effective, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading, or (ii) that the
Prospectus Supplement as of its date and as of the date of its opinion contained
or contains an untrue statement of a material fact or omitted or omits to state
a material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading. Such counsel
shall further state that it is of the opinion that insofar as the statements
contained in the Registration Statement and the Prospectus Supplement under the
captions "Description of Notes" and "Supplemental Plan of Distribution"
constitute a summary of the documents referred to therein, such statements
fairly present the information called for with respect to such documents by the
Securities Act and the Trust Indenture Act and the applicable rules and
regulations of the Commission thereunder relating to registration statements on
Form S-3 and prospectuses.
(e) You shall have received a certificate of the secretary or assistant
secretary of Caterpillar Inc., a Delaware corporation ("Caterpillar"), as to (i)
the Restated Certificate of Incorporation of Caterpillar, (ii) the Bylaws of
Caterpillar and (iii) no amendments to or action taken by Caterpillar or its
directors or officers in contemplation of making any amendment to the following
agreements between Caterpillar and the Company since the respective dates
thereof: (A) the Support Agreement, dated as of December 21, 1984, as amended by
First Amendment to the Support Agreement, dated June 14, 1995 (as so amended,
the "Support Agreement"); and (B) the Tax Sharing Agreement, dated as of June
21, 1984.
The obligations of the Purchasing Agent to purchase Notes as principal,
both under this Agreement and under any Terms Agreement are subject to the
conditions that (i) no litigation or proceeding shall be threatened or pending
to restrain or enjoin the issuance or delivery of the Notes, or which in any way
questions or affects the validity of the Notes, (ii) no stop order suspending
the effectiveness of the Registration Statement shall be in effect, and no
proceedings for such purpose shall be pending before or threatened by the
Commission and (iii) there shall have been no material adverse change not in the
ordinary course of business in the consolidated financial condition of the
Company and its subsidiaries, taken as a whole, from that set forth in the
Registration Statement and the Prospectus, each of which conditions shall be met
on the corresponding Settlement Date (as defined in Section IV(b) hereof).
Further, if specifically called for by any written agreement by the Purchasing
Agent to purchase Notes as principal, the Purchasing Agent's obligations
hereunder and under such agreement, shall be subject to such of the additional
conditions set forth in clause (a), as it relates to the executive officer's
certificate, and clauses (b), (c) and (d) above, as agreed to by the parties,
each of which such agreed conditions shall be met on the corresponding
Settlement Date.
III.
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In further consideration of your agreements herein contained, the
Company covenants as follows:
(a) To furnish to you, without charge, a copy of (i) the Indenture, (ii)
the resolutions of the Board of Directors (or Executive Committee) of the
Company authorizing the issuance and sale of the Notes, certified by the
Secretary or Assistant Secretary of the Company as having been duly adopted,
(iii) the Registration Statement including exhibits and materials incorporated
by reference therein and (iv) as many copies of the Prospectus, any documents
incorporated by reference therein and any supplements and amendments thereto as
you may reasonably request.
(b) Before amending or supplementing the Registration Statement or the
Prospectus (other than amendments or supplements to change interest rates), to
furnish you a copy of each such proposed amendment or supplement, and to afford
you a reasonable opportunity to comment on any such proposed amendment or
supplement.
(c) To furnish you copies of each amendment to the Registration
Statement and of each amendment and supplement to the Prospectus in such
quantities as you may from time to time reasonably request; and if at any time
when the delivery of a Prospectus shall be required by law in connection with
sales of any of the Notes, either (i) any event shall have occurred as a result
of which the Prospectus as then amended or supplemented would include any untrue
statement of a material fact, or omit to state any material fact necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading or (ii) for any other reason it shall be
necessary to amend or supplement the latest Prospectus, as then amended or
supplemented, or to file under the Exchange Act any document incorporated by
reference in the Prospectus in order to comply with the Securities Act or the
Exchange Act, the Company will (A) notify you to suspend the solicitation of
offers to purchase Notes and if notified by the Company, you shall forthwith
suspend such solicitation and cease using the Prospectus as then amended or
supplemented and (B) promptly prepare and file with the Commission such document
incorporated by reference in the Prospectus or an amendment or supplement to the
Registration Statement or the Prospectus which will correct such statement or
omission or effect such compliance and will provide to you without charge a
reasonable number of copies thereof, which you shall use thereafter.
(d) To endeavor to qualify such Notes for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you shall reasonably
request and to pay all reasonable expenses (including fees and disbursements of
counsel) in connection with such qualification and in connection with the
determination of the eligibility of such Notes for investment under the laws of
such jurisdictions as you may designate; provided, that, in connection therewith
the Company shall not be required to qualify as a foreign corporation to do
business, or to file a general consent to service of process, in any
jurisdiction.
(e) The Company will make generally available to its security holders
and to you 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
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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 available not later than 45 days after the
close of the period covered thereby.
(f) (i) To use its reasonable efforts, in cooperation with the
Purchasing Agent, to cause such Notes as the Company and the Purchasing Agent
agree to be accepted for listing on any stock exchange (each, a "Stock
Exchange"), in each case as the Company and the Purchasing Agent shall deem to
be appropriate. In connection with any such agreement to qualify Notes for
listing on a Stock Exchange, the Company shall use its reasonable efforts to
obtain such listing promptly and shall furnish any and all documents,
instruments, information and undertakings that may be necessary or advisable in
order to obtain and maintain the listing.
(ii) So long as any Note remains outstanding and listed on a
Stock Exchange, if either (A) there is a significant change affecting any matter
described in the Prospectus the inclusion of which was required by applicable
law, the listing rules and regulations of such Stock Exchange on which any Notes
are listed (the "Listing Rules"), or by such Stock Exchange or (B) a significant
new matter arises the inclusion of information with respect to which would have
been so required if it had arisen when the Prospectus was prepared, to provide
to the Purchasing Agent information about the change or matter, publish such
supplementary Prospectus as may be required by such Stock Exchange and otherwise
comply with applicable law and the Listing Rules in that regard.
(iii) To use reasonable efforts to comply with any undertakings
given by it from time to time to any Stock Exchange on which any Notes are
listed.
(g) To notify the Purchasing Agent promptly in writing in the event that
the Company does not have a security listed on the New York Stock Exchange.
(h) The Company will notify the Purchasing Agent as soon as practicable,
and confirm such notice in writing, of any change in the rating assigned by any
nationally recognized statistical rating organization, as such term is defined
in Rule 436(g)(2) under the Securities Act, to the Medium-Term Note Program
under which the Notes are issued (the "Program") or any debt securities
(including the Notes) of the Company, or the public announcement by any
nationally recognized statistical rating organization that it has under
surveillance or review, with possible negative implications, its rating of the
Program or any such debt securities, or the withdrawal by any nationally
recognized statistical rating organization of its rating of the Program or any
such debt securities. The Purchasing Agent will, in turn, notify promptly the
other Agents of any such change.
IV.
(a) Acting as Agent. You hereby agree, as Agents hereunder, to use your
reasonable best efforts to solicit and receive offers to purchase Notes upon the
terms and conditions set forth herein and in the Prospectus and upon the terms
communicated to you from time to time by the Company. For the purpose of such
solicitation you will use the Prospectus as then amended or supplemented which
has been most recently distributed to you by the Company, and you will solicit
purchases only as permitted or contemplated thereby and herein and will solicit
purchases
7
of the Notes only as permitted by the Securities Act and the applicable
securities laws or regulations of any jurisdiction. The Company reserves the
right, in its sole discretion, to suspend solicitation of purchases of the Notes
commencing at any time for any period of time or permanently. Upon receipt of
instructions (which may be given orally) from the Company, you will forthwith
suspend solicitation of purchases until such time as the Company has advised you
that such solicitation may be resumed.
You are authorized to solicit orders for the Notes only in denominations
of $1,000 or more (in multiples of $1,000). You are not authorized to appoint
subagents or to engage the service of any other broker or dealer in connection
with the offer or sale of the Notes without the consent of the Company;
provided, however, the Purchasing Agent may engage the service of any other
broker or dealer without the consent of the Company. The Purchasing Agent will
however, on a periodic basis, provide the Company with a listing of those
brokers or dealers so engaged. In addition, unless otherwise instructed by the
Company, the Purchasing Agent shall communicate to the Company, orally or in
writing, offers to purchase Notes on an aggregate basis by CUSIP numbers of the
Notes. The Company shall have the sole right to accept offers to purchase Notes
offered through you and may reject any proposed purchase of Notes as a whole or
in part. You shall have the right, in your discretion reasonably exercised, to
reject any proposed purchase of Notes, as a whole or in part, and any such
rejection shall not be deemed a breach of your agreements contained herein. The
Company agrees to pay the Purchasing Agent, as consideration for soliciting the
sale of the Notes, a concession in the form of a discount equal to the
percentages of the initial offering price of each Note sold not in excess of the
concession set forth in Exhibit A hereto (the "Concession"). The Purchasing
Agent and the other Agents will share the above-mentioned Concession in such
proportions as they may agree.
(b) Acting as Principal. Each sale of Notes to an Agent as principal
shall be made in accordance with the terms of this Agreement and a separate
agreement, substantially in the form of Exhibit C hereto, to be entered into on
behalf of such Agent(s) by the Purchasing Agent, which will provide for the sale
of such Notes to, and the purchase and reoffering thereof by, the Purchasing
Agent as principal. Each such separate agreement (which may be an oral agreement
and confirmed in writing as described below between the Purchasing Agent and the
Company) is herein referred to as a "Terms Agreement". A Terms Agreement may
also specify certain provisions relating to the reoffering of such Notes by the
Purchasing Agent. The Purchasing Agent's agreement to purchase Notes pursuant to
any Terms Agreement shall be deemed to have been made on the basis of the
representations, warranties and agreements of the Company herein contained and
shall be subject to the terms and conditions herein set forth. Except pursuant
to a Terms Agreement, under no circumstances shall you be obligated to purchase
any Notes for your own account. Each Terms Agreement, whether oral (and
confirmed in writing which may be by facsimile transmission) or in writing,
shall describe the Notes to be purchased pursuant thereto by the Purchasing
Agent as principal, and may specify, among other things, the principal amount of
Notes to be purchased, the interest rate or formula and maturity date or dates
of such Notes, the interest payment dates, if any, the price to be paid to the
Company for such Notes, the initial public offering price at which the Notes are
proposed to be reoffered, and the time and place of delivery of and payment for
such Notes (the "Settlement Date"), whether the Notes provide for a survivor's
option or for optional redemption by the Company and on what terms and
conditions, and any other relevant terms. Terms Agreements may take the form of
an exchange of any standard form of written telecommunication between the
Purchasing Agent and the Company.
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In connection with the resale of the Notes purchased, without the
consent of the Company, you are not authorized to appoint subagents or to engage
the service of any other broker or dealer, nor may you reallow any portion of
the discount paid to you by the Company in excess of the designated reallowance
portion; provided, however, that the Purchasing Agent may engage the service of
any other broker or dealer without the consent of the Company. The Purchasing
Agent will however, on a periodic basis, provide the Company with a listing of
those brokers or dealers so engaged. Unless authorized by the Purchasing Agent
in each instance, each Agent agrees not to purchase and sell Notes for which an
order from a client has not been received.
Each purchase of Notes by the Purchasing Agent from the Company shall be
at a discount to the percentages of the initial offering price of each such Note
on the date of issue not in excess of the applicable Concession set forth in
Exhibit A hereto.
(c) Public Offering Price. Unless otherwise authorized by the Company,
all Notes shall be sold to the public at a purchase price not to exceed 100% of
the principal amount thereof, plus accrued interest, if any, with the exception
of Notes that bear a zero interest rate and are issued at a substantial discount
from the principal amount payable at the Maturity Date (a "Zero-Coupon Note").
Such Zero-Coupon Notes shall be sold to the public at a purchase price no
greater than an amount, expressed as a percentage of the principal face amount
of such Notes, equal to the net proceeds to the Company on the sale of such
Notes, plus the Concession, plus accrued interest, if any. Such purchase price
shall be set forth in the confirmation statement of the Selling Group member
responsible for such sale, and delivered to the purchaser along with a copy of
the Prospectus (if not previously delivered) and Pricing Supplement.
(d) Procedures. Procedural details relating to the issue and delivery
of, and the solicitation of purchases and payment for, the Notes, whether under
Section IV(a) or IV(b) of this Agreement, are set forth in the Administrative
Procedures attached hereto as Exhibit B (the "Procedures"), as amended from time
to time. The provisions of the Procedures shall apply to all transactions
contemplated hereunder. You and the Company each agree to perform the respective
duties and obligations specifically provided to be performed by each in the
Procedures as amended from time to time. The Procedures may only be amended by
written agreement of the Company and you.
(e) Prospectus Delivery; Marketing Materials. You shall, as required by
applicable law, furnish to each person to whom you sell or deliver Notes a copy
of the Prospectus (as then amended or supplemented) or, if delivery of the
Prospectus is not required by applicable law, inform each such person that a
copy thereof (as then amended or supplemented) will be made available upon
request. You are not authorized to give any information or to make any
representation not contained in the Prospectus or the documents incorporated by
reference or specifically referred to therein in connection with the offer and
sale of the Notes. The Company agrees that the Purchasing Agent may utilize the
Company's name, logo and trademark to identify the Company as a member of the
Direct Access Notes Program in the Purchasing Agent's general materials and
marketing objectives relating to the Direct Access Notes Program (the "Marketing
Materials") that are provided to and approved by the Company. The Company hereby
grants the Purchasing Agent a non-exclusive, nonsublicenseable, revocable,
royalty-free
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license to use the Company's name, logo and trademarks solely in connection
with their use in Marketing Materials that are provided to and approved by the
Company. Any approvals from or authorizations by the Company under this Section
IV(e) may be transmitted electronically by the Company to the Purchasing Agent.
V.
The Company represents and warrants to the Agents that as of the date
hereof, as of each date on which the Company accepts an offer to purchase Notes
(including any purchase by the Purchasing Agent as principal, pursuant to a
Terms Agreement or otherwise), as of each date the Company issues and sells
Notes and as of each date the Registration Statement or the Prospectus is
amended or supplemented:
(a) (i) each document, if any, filed, or to be filed, pursuant to the
Exchange Act and incorporated by reference in the Prospectus complied when so
filed, or will comply, in all material respects with such Act and the rules and
regulations thereunder; (ii) the Registration Statement (including the documents
incorporated by reference therein), filed with the Commission pursuant to the
Securities Act relating to the Notes, when it became effective, did 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) each Prospectus, if any, filed pursuant to Rule 424 under the
Securities Act, complied when so filed in all material respects with such Act
and the applicable rules and regulations thereunder; (iv) the Registration
Statement and each 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 thereunder; and (v) the Registration Statement
and each Prospectus relating to the Notes do not 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 in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;
(b) the Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, with corporate power and authority to own its properties and
conduct its business as described in the Prospectus, and has been duly qualified
as a foreign corporation for the transaction of business and is in good standing
under the laws of each other jurisdiction in which it owns or leases properties,
or conducts any business so as to require such qualification, or is subject to
no material liability or disability by reason of the failure to be so qualified
in any such jurisdiction;
(c) the Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued and are fully paid and
non-assessable, and all of such shares are owned directly or indirectly by
Caterpillar, free and clear of all liens, encumbrances, security interests or
claims;
(d) the Notes have been duly authorized, and, when issued and delivered
pursuant to this Agreement and any Terms Agreement, will have been duly
executed, authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Company entitled to the benefits provided by
the Indenture; the Indenture has been duly authorized and duly qualified under
the Trust Indenture Act and constitutes a valid and legally binding instrument,
enforceable in accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general applicability
relating to or affecting creditors' rights and
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to general equity principles; and the Indenture conforms and the Notes of any
particular issuance of Notes will conform to the descriptions thereof contained
in the Prospectus as amended or supplemented to relate to such issuance of
Notes;
(e) other than as set forth in the Prospectus, the Company and each of
its subsidiaries have conducted their businesses and are in compliance in all
material respects with all applicable federal and state laws and regulations,
except for any noncompliance which would not have a material adverse effect on
the Company and its subsidiaries considered as a whole;
(f) the issue and sale of the Notes, the compliance by the Company with
all of the provisions of the Notes, the Indenture, this Agreement and any Terms
Agreement, and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach or violation of any of
the terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which the Company
or any of its subsidiaries is bound or to which any of the property or assets of
the Company or any of its subsidiaries is subject, nor will such action result
in any violation of the provisions of the Certificate of Incorporation or Bylaws
of the Company or any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any of its
properties; and no consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is required
for the solicitation of offers to purchase Notes, the issue and sale of the
Notes or the consummation by the Company of the other transactions contemplated
by this Agreement, any Terms Agreement or the Indenture, except such as have
been, or will have been prior to the Commencement Date, obtained under the
Securities Act or the Trust Indenture Act and such consents, approvals,
authorizations, registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the solicitation by you of offers
to purchase Notes from the Company and with purchases of Notes by you as
principal, as the case may be, in each case in the manner contemplated hereby;
(g) other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its subsidiaries
is a party or to which any property of the Company or any of its subsidiaries is
subject, which are of a character which are required to be disclosed in the
Prospectus which have not been properly disclosed therein;
(h) immediately after any sale of Notes by the Company hereunder or
under any Terms Agreement, the aggregate amount of Notes which shall have been
issued and sold by the Company hereunder or under any Terms Agreement and of any
debt securities of the Company (other than such Notes) that shall have been
issued and sold pursuant to the Registration Statement will not exceed the
amount of debt securities registered under the Registration Statement;
(i) the Program and the Notes are rated A2 by Xxxxx'x Investors Service,
Inc. and A by Standard & Poor's Ratings Services, or such other rating as to
which the Company shall have most recently notified the Agents pursuant to
Section III(h) hereof;
11
(j) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been any material
increase in the consolidated long-term debt of the Company or any of its
subsidiaries (other than debt incurred in the ordinary course pursuant to the
Company's medium-term note programs) or any material adverse change, or any
development involving a prospective material adverse change, in or affecting the
general affairs, management, consolidated financial position, shareholder's
equity or results of operations of the Company and its subsidiaries, otherwise
than as set forth or contemplated in the Prospectus; and
(k) the Company is not, and upon the issuance and sale of the Notes as
herein contemplated and the application of the net proceeds therefrom as
described in the Prospectus will not be, an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
The above representations and warranties shall not apply to any
statements or omissions made in the Prospectus in reliance upon and in
conformity with information furnished in writing to the Company by you expressly
for use therein. Each acceptance by the Company of an offer for the purchase of
Notes and each issuance of Notes shall be deemed an affirmation by the Company
that the foregoing representations and warranties are true and correct at the
time, as the case may be, of such acceptance or of such issuance, in each case
as though expressly made at such time. The representations, warranties and
covenants of the Company shall survive the execution and delivery of this
Agreement and the issuance and sale of the Notes.
Each time the Registration Statement shall be amended by the filing of a
post-effective amendment with the Commission, or the filing by the Company of a
Form 10-K or Form 10-Q pursuant to Section 13 of the Exchange Act, or, if so
agreed in connection with a particular transaction, the Company shall furnish
the Agents with (1) a written opinion, dated the date of such amendment, filing,
or as otherwise agreed, of counsel to the Company, in substantially the form
previously delivered under Section II(b), but modified, as necessary, to relate
to the Registration Statement and the Prospectus as amended or supplemented at
such date; (2) a letter, dated the date of such amendment, filing, or as
otherwise agreed, of PricewaterhouseCoopers LLP, independent auditors, in
substantially the form previously delivered under Section II(c), but modified,
as necessary, to relate to the Registration Statement and the Prospectus as
amended or supplemented at such date; and (3) a certificate, dated the date of
such amendment, filing, or as otherwise agreed and signed by an executive
officer of the Company, in substantially the form previously delivered under
Section II(a), but modified, as necessary, to relate to the Registration
Statement and the Prospectus as amended or supplemented at such date.
VI.
The Company agrees to indemnify and hold harmless you, each person, if
any, who controls (within the meaning of either Section 15 of the Securities Act
or Section 20 of the Exchange Act) you and each of your and such person's
officers and directors against any and all losses, liabilities, costs or claims
(or actions in respect thereof) to which any of them may become subject
(including all reasonable costs of investigating, disputing or defending any
such claim or action), insofar as such losses, liabilities, costs or claims (or
actions in respect thereof) arise out of or in connection with any untrue
statement or alleged untrue statement of a material
12
fact contained in the Registration Statement or any Prospectus, or any
amendment or supplement thereto, or 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 provided: (i) that the Company shall not be
liable for any such loss, liability, cost, action or claim arising from any
statements or omissions made in reliance on and in conformity with written
information provided by the Agents through the Purchasing Agent to the Company
expressly for use in the Registration Statement or Prospectus or any amendment
or supplement thereto; and (ii) that the Company shall not be liable to you or
any person controlling you with respect to the Prospectus to the extent any such
loss, liability, cost, action or claim to you or such controlling person results
from the fact that you sold Notes to a person to whom there was not sent or
given, at or prior to the earlier of either the mailing or delivery of the
written confirmation of such sale or the delivery of such Notes to such person,
a copy of the Prospectus as then amended or supplemented, if the Company has
previously furnished copies thereof to you.
Each Agent severally agrees to indemnify and hold harmless the Company, each
person, if any, who controls (within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act) the Company, and the Company's
and such persons' officers and directors from and against any and all losses,
liabilities, costs or claims (or actions in respect thereof) to which any of
them may become subject (including all reasonable costs of investigating,
disputing or defending any such claim or action), insofar as such losses,
liabilities, costs or claims (or actions in respect thereof) arise out of or in
connection with any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement or Prospectus, or any amendment or
supplement thereto, or any omission or alleged omission to state therein a
material fact necessary to make the statements therein not misleading, in each
case only to the extent that such untrue statement or alleged untrue statement
or omission or alleged omission was made in the section of the Prospectus
Supplement or any amendment or supplement thereto entitled "Supplemental Plan of
Distribution" in reliance on and in conformity with written information
furnished to the Company by such Agent through the Purchasing Agent expressly
for use therein.
If any claim, demand, action or proceeding (including any governmental
investigation) shall be brought or alleged against an indemnified party in
respect of which indemnity is to be sought against an indemnifying party
pursuant to the preceding paragraphs, the indemnified party shall, promptly
after receipt of notice of the commencement of any such claim, demand, action or
proceeding, notify the indemnifying party in writing of the commencement of such
claim, demand, action or proceeding, enclosing a copy of all papers served, if
any; provided, that, the omission to so notify such indemnifying party will not
relieve the indemnifying party from any liability that it may have to any
indemnified party under the foregoing provisions of this Section VI unless, and
only to the extent that, such omission results in the forfeiture of substantive
rights or defenses by the indemnifying party. The indemnifying party, upon
request of the indemnified party, shall retain counsel reasonably satisfactory
to the indemnified party to represent the indemnified party and any others the
indemnified party may designate in such proceeding and shall pay the reasonable
fees and expenses 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 reasonable 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,
(ii) the indemnifying party has failed within a reasonable time to retain
counsel reasonably satisfactory to such indemnified party or (iii) the
13
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 agreed that the indemnifying party shall
not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees and expenses of more than one
separate law firm (in addition to local counsel where necessary) for all such
indemnified parties. Such firm shall be designated in writing by the indemnified
party. 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 indemnifying the indemnified party from and against any loss or
liability by reason of such settlement or judgment. 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 such indemnified party from all liability on claims
that are the subject matter of such proceeding.
If the indemnification provided for in this Section VI is unavailable to
or insufficient to hold harmless an indemnified party under the preceding
paragraphs of this Section VI in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and each Agent on the
other from the offering of the Notes to which such loss, claim, damage or
liability (or action in respect thereof) relates. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law, then each indemnifying party shall contribute to such amount paid or
payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company on the one hand and each Agent on the other in connection with the
statements or omissions which resulted in such losses, claims, damages or
liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and each Agent on the other shall be deemed to be in the same
proportion as the total net proceeds from the sale of Notes (before deducting
expenses) received by the Company bear to the total commissions or discounts
received by such Agent in respect thereof. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact required to be stated therein or necessary in order to make the
statements therein not misleading relates to information supplied by the Company
on the one hand or by any Agent on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and each Agent agree that it would not be
just and equitable if contribution pursuant to this fourth paragraph of Section
VI were determined by per capita allocation (even if all Agents were treated as
one entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to above in this fourth
paragraph of Section VI. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this fourth paragraph of Section VI shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in
14
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this fourth paragraph of Section VI, no Agent
shall be required to contribute any amount in excess of any Concession received
by it and no person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The obligations of each
of the Agents under this fourth paragraph of Section VI to contribute are
several in proportion to the respective purchases made by or through it to which
such loss, claim, damage or liability (or action in respect thereof) relates and
are not joint.
The indemnity and contribution agreements contained in this Section VI
and the representations and warranties of the Company and you in this Agreement,
shall remain operative and in full force and effect regardless of: (i) any
termination of this Agreement; (ii) any investigation made by or on behalf of
the Agents; (iii) any investigation by an indemnified party or on such party's
behalf or any person controlling an indemnified party or by or on behalf of the
indemnifying party, its directors or officers or any person controlling the
indemnifying party; and (iv) acceptance of and payment for any of the Notes.
VII.
Except as provided in Section IV hereof, in soliciting purchases of
Notes from the Company, you are acting solely as agent for the Company, and not
as principal. You will make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer to purchase Notes has been
accepted by the Company, but you shall not have any liability to the Company in
the event such purchase is not consummated for any reason, other than to repay
to the Company any commission with respect thereto. Except pursuant to a Terms
Agreement, under no circumstances shall you be obligated to purchase any Notes
for your own account.
VIII.
This Agreement shall be terminated at any time by either party hereto
upon the giving of five business days written notice of such termination to the
other party hereto. In the event of any such termination, neither party shall
have any liability to the other party hereto, except for obligations hereunder
which expressly survive the termination of this Agreement and except that, if at
the time of termination an offer for the purchase of Notes shall have been
accepted by the Company but the time of delivery to the purchaser or his agent
of the Note or Notes relating thereto shall not yet have occurred, the Company
shall have the obligations provided herein with respect to such Note or Notes.
Subsequent to the execution of a Terms Agreement, (i) the Purchasing
Agent may terminate such Terms Agreement, and (ii), if the Purchasing Agent does
not elect to terminate such Terms Agreement pursuant to clause (i) of this
sentence, upon the request of an Agent with respect to Notes to be purchased
through the Purchasing Agent by such Agent, the Purchasing Agent shall terminate
such Terms Agreement to the extent of the Notes that were to be purchased
through the Purchasing Agent by such requesting Agent, in each case immediately
upon notice to the Company, at any time prior to the Settlement Date relating
thereto, if there shall have occurred any:
15
(A) change in the long-term debt of the Company or any change,
or any development involving a prospective change, in the financial
condition or in the earnings, business or operations of the Company and
its subsidiaries, considered as a whole, otherwise than as set forth or
contemplated in the Prospectus (exclusive of any supplement to the
Prospectus filed after the execution of a Terms Agreement and at or
prior to the related Settlement Date), the effect of which is, in the
judgment of the Purchasing Agent or such requesting Agent, so material
and adverse as to make it impracticable or inadvisable to proceed with
the public offering of such Notes or enforce contracts for the sale of
such Notes; or
(B) downgrading in the rating of the Company's debt securities
(including the Notes) by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the
Securities Act), and no such organization shall have publicly announced
that it has under surveillance or review, with possible negative
implications, its rating of such debt securities; or
(C) banking moratorium declared by Federal or New York
authorities, or the authorities of any country in whose currency any
Notes are denominated under the applicable Terms Agreement; or
(D) any attack on, or outbreak or escalation of hostilities or
act of terrorism involving the United States or any country in whose
currency any Notes are denominated under the applicable Terms Agreement
is involved, any declaration of war by Congress, any material adverse
change in financial markets or any other substantial national or
international calamity or emergency if, in the judgment of the
Purchasing Agent or such requesting Agent, the effect of any such
attack, outbreak, escalation, act, material adverse change, declaration,
calamity or emergency makes it impractical or inadvisable to proceed
with the public offering of such Notes or enforce contracts for the sale
of such Notes;
(E) action by any governmental authority or any change, or any
development involving a prospective change, involving currency exchange
rates or exchange controls, which makes it impracticable or inadvisable
in the judgment of the Purchasing Agent or such requesting Agent to
proceed with the public offering of such Notes or enforce contracts for
the sale of such Notes; or
(F) a suspension or material limitation in trading in securities
generally on the New York Stock Exchange or any suspension of trading of
the Company's securities on any exchange or in the over-the-counter
market which makes it impracticable or inadvisable in the judgment of
the Purchasing Agent or such requesting Agent to proceed with the public
offering of such Notes or enforce contracts for the sale of such Notes.
If this Agreement is terminated, the last sentence of the penultimate
paragraph of Section IV(a), Section III(c), (d) and (e), Section VI, and the
first paragraph of Section XIII shall survive; provided, that, if at the time of
termination of this Agreement 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 Section III(a) and (b), Section IV(b) and
(d) shall also survive until time of delivery.
16
IX.
Except as otherwise specifically provided herein, all statements,
requests, notices and advices hereunder shall be in writing, or by telephone if
promptly confirmed in writing, and if to you shall be sufficient in all respects
if delivered in person or sent by telex, facsimile transmission (confirmed in
writing), or registered mail to you at your address, telex or telecopier number
set forth below by your signature and if to the Company shall be sufficient in
all respects if delivered or sent by telex, telecopier or registered mail to the
Company at 0000 Xxxx Xxx Xxxxxx, Xxxxxxxxx, Xxxxxxxxx 00000-0000, telecopier
number 000-000-0000, marked for the attention of the Secretary. All such notices
shall be effective on receipt.
X.
This Agreement shall be binding upon you and the Company, and inure
solely to the benefit of you and the Company and any other person expressly
entitled to indemnification hereunder and the respective personal
representatives, successors and assigns of each, and no other person shall
acquire or have any rights under or by virtue of this Agreement.
XI.
This Agreement shall be governed by and construed in accordance with the
substantive laws of the State of New York. Each party to this Agreement
irrevocably agrees that any legal action or proceeding against it arising out of
or in connection with this Agreement or for recognition or enforcement of any
judgment rendered against it in connection with this Agreement may be brought in
any Federal or New York State court sitting in the Borough of Manhattan, and, by
execution and delivery of this Agreement, such party hereby irrevocably accepts
and submits to the jurisdiction of each of the aforesaid courts in personam,
generally and unconditionally with respect to any such action or proceeding for
itself and in respect of its property, assets and revenues. Each party hereby
also irrevocably waives, to the fullest extent permitted by law, any objection
which it may now or hereafter have to the laying of venue of any such action or
proceeding brought in any such court and any claim that any such action or
proceeding has been brought in an inconvenient forum.
XII.
If this Agreement is executed by or on behalf of any party, such person
hereby states that at the time of the execution of this Agreement he has no
notice of revocation of the power of attorney by which he has executed this
Agreement as such attorney.
XIII.
The Company will pay the expenses incident to the performance of its
obligations under this Agreement, including: (i) the preparation and filing of
the Registration Statement; (ii) the preparation, issuance and delivery of the
Notes; (iii) the fees and disbursements of the Company's auditors, of the
Trustee and its counsel and of any paying or other agents appointed by the
Company; (iv) the printing and delivery to you in quantities as hereinabove
stated of copies of the Registration Statement and the Prospectus; (v) the
reasonable fees and disbursements of Xxxxxx, Xxxx & Xxxxxxxx LLP, counsel for
the Agents (including "Blue Sky"
17
fees and disbursements); (vi) if the Company lists Notes on a securities
exchange, the costs and fees of such listing; and (vii) any fees charged by
rating agencies for the rating of the Notes.
This Agreement may be executed by each of the parties hereto in any
number of counterparts, and by each of the parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed to be an original, but all such counterparts shall together constitute
but one and the same instrument.
[the remainder of this page is intentionally left blank]
18
If the foregoing is in accordance with your understanding, please sign
and return to us a counterpart hereof, and upon acceptance hereof by you, this
letter and such acceptance hereof shall constitute a binding agreement between
the Company and you.
Very truly yours,
CATERPILLAR FINANCIAL SERVICES
CORPORATION
By:
--------------------------------------
Name:
Title:
Confirmed and accepted
as of the date first above written:
[AGENT NAME]
By:
--------------------------------
Name:
Title:
[AGENT NAME]
By:
--------------------------------
Name:
Title:
19
EXHIBIT A
POWERNOTES(R)
CATERPILLAR FINANCIAL SERVICES CORPORATION
DEALER AGENT PROGRAM
Unless otherwise agreed between the Company and the Purchasing Agent for a
particular offering of Notes, the following Concessions are payable as a
percentage of the non-discounted Price to Public of each note sold to or through
the Purchasing Agent:
9 months to less than 23 months.............. [___]%
23 months to less than 35 months............. [___]%
35 months to less than 47 months............. [___]%
47 months to less than 59 months............. [___]%
59 months to less than 71 months..............[___]%
71 months to less than 83 months..............[___]%
83 months to less than 95 months..............[___]%
95 months to less than 107 months.............[___]%
107 months to less than 119 months............[___]%
119 months to less than 131 months............[___]%
131 months to less than 143 months............[___]%
143 months to less than 179 months............[___]%
179 months to less than 239 months............[___]%
239 months to 360 months......................[___]%
A-1
EXHIBIT B
CATERPILLAR FINANCIAL SERVICES CORPORATION
$[___________]
POWERNOTES(R)
WITH MATURITIES OF 9 MONTHS OR MORE FROM DATE OF ISSUE
ADMINISTRATIVE PROCEDURES
PowerNotes(R) With Maturities of 9 Months or More from Date of Issue the
("Notes") are offered on a continuing basis by Caterpillar Financial Services
Corporation. The Notes will be offered by [Agent Name] (the "Purchasing Agent"),
[Agent Name] (collectively, the "Agents") pursuant to a Selling Agent Agreement
among the Company and the Agents dated as of the date hereof (the "Selling
Agreement") and one or more terms agreements substantially in the form attached
to the Selling Agreement as Exhibit C (each a "Terms Agreement"). The Notes are
being resold by the Purchasing Agent (and by any Agent that purchases them from
the Purchasing Agent) to (i) customers of the Agents or (ii) selected
broker-dealers (the "Selling Group") for distribution to their customers
pursuant to a Master Selected Dealers Agreement (a "Dealers Agreement") attached
hereto as Schedule E. The Agents have agreed to use their reasonable best
efforts to solicit purchases of the Notes. The Notes will be senior debt and
have been registered with the Securities and Exchange Commission (the
"Commission"). U.S. Bank Trust National Association (formerly First Trust of New
York, National Association) is trustee (the "Trustee") under an Indenture dated
as of April 15, 1985, as amended from time to time, between the Company and the
Trustee (the "Indenture") covering the Notes. Pursuant to the terms of the
Indenture, U.S. Bank Trust National Association also will serve as
authenticating agent, issuing agent and paying agent.
Each tranche of Notes will be issued in book-entry form and represented by one
or more fully registered global notes without coupons (each, a "Global Note")
held by the Trustee, as agent for the Depository Trust Corporation ("DTC") and
recorded in the book-entry system maintained by DTC. Each Global Note will have
the annual interest rate, maturity and other terms set forth in the relevant
Pricing Supplement (as defined in the Selling Agreement). Owners of beneficial
interests in a Global Note will be entitled to physical delivery of Notes issued
in certificated form equal in principal amount to their respective beneficial
interests only upon certain limited circumstances described in the Indenture.
Administrative procedures and specific terms of the offering are explained
below. Administrative responsibilities will be handled for the Company by its
Treasury Department; accountable document control and record-keeping
responsibilities will be performed by its Legal Department. The Company will
advise the Agents and the Trustee in writing of those persons handling
administrative responsibilities with whom the Agents and the Trustee are to
communicate regarding offers to purchase Notes and the details of their
delivery.
Notes will be issued in accordance with the administrative procedures set forth
herein. To the extent the procedures set forth below conflict with or omit
certain of the provisions of the Notes, the Indenture, the Selling Agent
Agreements or the Prospectus and the Pricing Supplement (together, the
"Prospectus"), the relevant provisions of the Notes, the Indenture, the Selling
B-1
Agent Agreements and the Prospectus shall control. Capitalized terms used herein
that are not otherwise defined shall have the meanings ascribed thereto in the
Selling Agent Agreement, the Prospectus in the form most recently filed with the
Commission pursuant to Rule 424 of the Securities Act, or in the Indenture.
ADMINISTRATIVE PROCEDURES FOR NOTES
In connection with the qualification of Notes for eligibility in the book-entry
system maintained by DTC, the Trustee will perform the custodial, document
control and administrative functions described below, in accordance with its
obligations under a Letter of Representations from the Company and the Trustee
to DTC, dated [________ __, ____] and a Medium-Term Note Certificate Agreement
between the Trustee and DTC (the "Certificate Agreement") dated January 31, 1991
and its obligations as a participant in DTC, including DTC's Same-Day Funds
Settlement System ("SDFS"). The procedures set forth below may be modified in
compliance with DTC's then applicable procedures and upon agreement by the
Company, the Trustee and the Purchasing Agent.
Maturities: Each Note will mature on a date (the "Stated Maturity
Date") not less than nine months after the date of
delivery by the Company of such Note. Notes will mature
on any date selected by the initial purchaser and agreed
to by the Company. "Maturity" when used with respect to
any Note means the date (such date, the "Maturity Date")
on which the outstanding principal amount of such Note
becomes due and payable in full in accordance with its
terms, whether at its Stated Maturity Date or by
declaration of acceleration, call for redemption,
repayment or otherwise.
Issuance: All Notes having the same terms will be represented
initially by a single Global Note. Each Global Note will
be dated and issued as of the date of its authentication
by the Trustee.
All Discount Notes which have the same terms
(collectively, the "Zero-Coupon Terms") will be
represented initially by a single Global Certificate in
fully registered form without coupons.
Each Global Note will bear an original issue date (the
"Original Issue Date"). The Original Issue Date shall
remain the same for all Notes subsequently issued upon
transfer, exchange or substitution of an original Note
regardless of their dates of authentication.
B-2
Identification
Numbers: The Company has received from the CUSIP Service Bureau
(the "CUSIP Service Bureau") of Standard & Poor's
Corporation ("Standard & Poor's) one series of CUSIP
numbers consisting of approximately 200 CUSIP numbers
for future assignment to Global Notes. The Company will
provide DTC and the Trustee with a list of such CUSIP
numbers. The Company will assign CUSIP numbers as
described below under Settlement Procedure "B". DTC will
notify the CUSIP Service Bureau periodically of the
CUSIP numbers that the Company has assigned to Global
Notes. The Company will reserve additional CUSIP numbers
when necessary for assignment to Global Notes and will
provide the Trustee and DTC with the list of additional
CUSIP numbers so obtained.
Registration: Unless otherwise specified by DTC, Global Notes will be
issued only in fully registered form without coupons.
Each Global Note will be registered in the name of Cede
& Co., as nominee for DTC, on the Note Register
maintained under the Indenture by the Trustee. The
beneficial owner of a Note (or one or more indirect
participants in DTC designated by such owner) will
designate one or more participants in DTC (with respect
to such Note, the "Participants") to act as agent or
agents for such owner in connection with the book-entry
system maintained by DTC, and DTC will record in
book-entry form, in accordance with instructions
provided by such Participants, a credit balance with
respect to such beneficial owner of such Note in the
account of such Participants. The ownership interest of
such beneficial owner in such Note will be recorded
through the records of such Participants or through the
separate records of such Participants and one or more
indirect participants in DTC.
Transfers: Transfers of interests in a Global Note will be
accomplished by book entries made by DTC and, in turn,
by Participants (and in certain cases, one or more
indirect participants in DTC) acting on behalf of
beneficial transferors and transferees of such
interests.
Exchanges: The Trustee, at the Company's request, may deliver to
DTC and the CUSIP Service Bureau at any time a written
notice of consolidation specifying (a) the CUSIP numbers
of two or more Global Notes outstanding on such date
that represent Notes having the same terms (except that
Issue Dates need not be the same) and for which
interest, if any, has been paid to the same date and
which otherwise constitute Notes of the same series and
tenor under the Indenture, (b) a date, occurring at
least 30 days after such written notice is delivered and
at least 30 days before the next Interest Payment Date,
if any, for the related Notes, on which such Global
Notes shall be exchanged for a single replacement Global
Note; and (c) a new CUSIP number, obtained from the
Company, to be assigned to such replacement Global Note.
Upon receipt of such a notice, DTC will send to its
Participants (including the Issuing Agent)
B-3
and the Trustee a written reorganization notice to the
effect that such exchange will occur on such date. Prior
to the specified exchange date, the Trustee will deliver
to the CUSIP Service Bureau written notice setting forth
such exchange date and the new CUSIP number and stating
that, as of such exchange date, the CUSIP numbers of the
Global Notes to be exchanged will no longer be valid. On
the specified exchange date, the Trustee will exchange
such Global Notes for a single Global Note bearing, the
new CUSIP number and the CUSIP numbers of the exchanged
Global Notes will, in accordance with CUSIP Service
Bureau procedures, be cancelled and not immediately
reassigned. Notwithstanding the foregoing, if the Global
Notes to be exchanged exceed $500,000,000 in aggregate
principal or face amount, one replacement Global Note
will be authenticated and issued to represent each
$500,000,000 of principal or face amount of the
exchanged Global Notes and an additional Global Note
will be authenticated and issued to represent any
remaining principal amount of such Global Notes (See
"Denominations" below).
Denominations: Notes will be issued in denominations of $1,000 or more
(in multiples of $1,000). Global Notes will be
denominated in principal or face amounts not in excess
of $500,000,000. If one or more Notes having an
aggregate principal or face amount in excess of
$500,000,000 would, but for the preceding sentence, be
represented by a single Global Note, then one Global
Note will be issued to represent each $500,000,000
principal or face amount of such Note or Notes and an
additional Global Note will be issued to represent any
remaining principal amount of such Note or Notes. In
such case, each of the Global Notes representing such
Note or Notes shall be assigned the same CUSIP number.
Issue Price: Unless otherwise specified in an applicable
Pricing Supplement, each Note will be issued at the
percentage of principal amount specified in the
Prospectus relating to such Note.
Interest: General. Each Note will bear interest at a fixed rate,
which may be zero during all or any part of the term in
the case of certain Notes issued at a price representing
a substantial discount from the principal amount payable
at Maturity. Interest on each Note will accrue from the
Issue Date of such Note for the first interest period
and from the most recent Interest Payment Date to which
interest has been paid for all subsequent interest
periods. Except as set forth hereafter, each payment of
interest on a Note will include interest accrued to but
excluding, as the case may be, the Interest Payment Date
or the date of Maturity (other than a Maturity Date of a
Note occurring on the 31st day of a month in which case
such payment of interest will include interest accrued
to but excluding the 30th day of such month). Any
payment of principal, premium or interest required to be
made on a day that is not a Business Day (as defined
below) may be made on the next succeeding Business
B-4
Day and no interest shall accrue as a result of any such
delayed payment.
Each pending deposit message described under Settlement
Procedure "C" below will be routed to Standard & Poor's
Corporation, which will use the message to include
certain information regarding the related Notes in the
appropriate daily bond report published by Standard &
Poor's Corporation.
Each Note will bear interest from and including its
Issue Date at the rate per annum set forth thereon and
in the applicable Pricing Supplement until the principal
amount thereof is paid, or made available for payment,
in full. Unless otherwise specified in the applicable
Pricing Supplement, interest on each Note (other than a
Zero-Coupon Note) will be payable either monthly,
quarterly, semi-annually or annually on each Interest
Payment Date and at Maturity (or on the date of
redemption or repayment if a Note is repurchased by the
Company prior to maturity pursuant to mandatory or
optional redemption provisions or the Survivor's
Option). Interest will be payable to the person in whose
name a Note is registered at the close of business on
the Regular Record Date next preceding each Interest
Payment Date; provided, however, interest payable at
Maturity, on a date of redemption or in connection with
the exercise of the Survivor's Option will be payable to
the person to whom principal shall be payable.
Any payment of principal, and premium, if any, or
interest required to be made on a Note on a day which is
not a Business Day need not be made on such day, but may
be made on the next succeeding Business Day with the
same force and effect as if made on such day, and no
additional interest shall accrue as a result of such
delayed payment. Unless otherwise specified in the
applicable Pricing Supplement, any interest on the Notes
will be computed on the basis of a 360-day year of
twelve 30-day months. The interest rates the Company
will agree to pay on newly-issued Notes are subject to
change without notice by the Company from time to time,
but no such change will affect any Notes already issued
or as to which an offer to purchase has been accepted by
the Company.
The Interest Payment Dates for a Note that provides for
monthly interest payments shall be the fifteenth day of
each calendar month (or the next Business Day),
commencing in the calendar month that next succeeds the
month in which the Note is issued. In the case of a Note
that provides for quarterly interest payments, the
Interest Payment Dates shall be the fifteenth day of
each third month (or the next Business Day), commencing
in the third succeeding calendar month following the
month in which the Note is issued. In the case of a Note
that provides for semi-annual interest payments, the
Interest Payment dates shall be the fifteenth day of
each sixth month (or the next Business Day), commencing
in the sixth succeeding calendar month following the
month
B-5
in which the Note is issued. In the case of a Note that
provides for annual interest payments, the Interest
Payment Date shall be the fifteenth day of every twelfth
month (or the next Business Day), commencing in the
twelfth succeeding calendar month following the month in
which the Note is issued. The Regular Record Date with
respect to any Interest Payment Date shall be the date
fifteen calendar days prior to such Interest Payment
Date, whether or not such date shall be a Business Day;
provided, however, that interest payable at Maturity
will be payable to the person to whom principal shall be
payable.
Each payment of interest on a Note shall include accrued
interest from and including the Issue Date or from and
including the last day in respect of which interest has
been paid (or duly provided for), as the case may be,
to, but excluding, the Interest Payment Date or Maturity
Date, as the case may be.
Calculation
of Interest: Unless otherwise specified in the applicable Pricing
Supplement, interest on the Notes (including interest
for partial periods) will be calculated on the basis of
a 360-day year of twelve 30-day months. (Examples of
interest calculations are as follows: October 1, 2003 to
April 1, 2004 equals 6 months and 0 days, or 180 days;
the interest paid equals 180/360 times the annual rate
of interest times the principal amount of the Note. The
period from December 3, 2003 to April 1, 2004 equals 3
months and 28 days, or 118 days; the interest payable
equals 118/360 times the annual rate of interest times
the principal amount of the Note.)
Business Day: "Business Day" means, unless otherwise specified in the
applicable Pricing Supplement, any day, other than a
Saturday or Sunday, that meets the following applicable
requirement: such day is not a day on which banking
institutions are authorized or required by law,
regulation or executive order to be closed in the City
of New York.
Payments of
Principal and
Interest: Payments of Principal and Interest. Promptly after each
Regular Record Date, the Trustee will deliver to the
Company and DTC a written notice specifying by CUSIP
number the amount of interest, if any, to be paid on
each Global Note on the following Interest Payment Date
(other than an Interest Payment Date coinciding with a
Maturity Date) and the total of such amounts. DTC will
confirm the amount payable on each Global Note on such
Interest Payment Date by reference to the daily bond
reports published by Standard & Poor's. On such Interest
Payment Date, the Company will pay to the Trustee, and
the Trustee in turn will pay to DTC, such total amount
of interest due (other than on the Maturity Date), at
the times and in the manner set forth below under
"Manner of Payment". If any Interest Payment Date for
any Note is not a Business
B-6
Day, the payment due on such day shall be made on the
next succeeding Business Day and no interest shall
accrue on such payment for the period from and after
such Interest Payment Date.
Payments on the Maturity Date. On or about the first
Business Day of each month, the Trustee will deliver to
the Company and DTC a written list of principal,
premium, if any, and interest to be paid on each Global
Note representing Notes maturing or subject to
redemption (pursuant to a sinking fund or otherwise) or
repayment in the following month. The Trustee, the
Company and DTC will confirm the amounts of such
principal, premium, if any, and interest payments with
respect to each Global Note on or about the fifth
Business Day preceding the Maturity Date of such Global
Note. On the Maturity Date, the Company will pay to the
Trustee, and the Trustee in turn will pay to DTC, the
principal amount of such Global Note, together with
interest and premium, if any, due on such Maturity Date,
at the times and in the manner set forth below under
"Manner of Payment". If the Maturity Date of any Global
Note is not a Business Day, the payment due on such day
shall be made on the next succeeding Business Day and no
interest shall accrue on such payment for the period
from and after such Maturity Date. Promptly after
payment to DTC of the principal and interest due on the
Maturity Date of such Global Note and all other Notes
represented by such Global Note, the Trustee will cancel
and destroy such Global Note in accordance with the
Indenture and so advise the Company.
Manner of Payment. The total amount of any principal,
premium, if any, and interest due on Global Notes on any
Interest Payment Date or at Maturity shall be paid by
the Company to the Trustee in immediately available
funds on such date. The Company will make such payment
on such Global Notes by instructing the Trustee to
withdraw funds from an account maintained by the Company
with The Chase Manhattan Bank, by wire transfer to The
Chase Manhattan Bank or as otherwise agreed with the
Trustee. The Company will confirm such instructions in
writing to the Trustee. Prior to 10:00 a.m., New York
City time, on the Maturity Date or as soon as possible
thereafter, the Trustee will make payment to DTC in
accordance with existing arrangements between DTC and
the Trustee, in funds available for immediate use by
DTC, each payment of interest, principal and premium, if
any, due on a Global Note on such date. On each Interest
Payment Date (other than on the Maturity Date) the
Trustee will pay DTC such interest payments in same-day
funds in accordance with existing arrangements between
the Trustee and DTC. Thereafter, on each such date, DTC
will pay, in accordance with its SDFS operating
procedures then in effect, such amounts in funds
available for immediate use to the respective
Participants with payments in amounts proportionate to
their respective holdings in principal amount of
beneficial interest in such Global Note as are recorded
in the book-entry system maintained by DTC. Neither the
Company nor the
B-7
Trustee shall have any direct responsibility or
liability for the payment by DTC of the principal of, or
premium, if any, or interest on, the Notes to such
Participants.
Withholding Taxes. The amount of any taxes required
under applicable law to be withheld from any interest
payment on a Note will be determined and withheld by the
Participant, indirect participant in DTC or other person
responsible for forwarding payments and materials
directly to the beneficial owner of such Note.
Procedure for
Rate Setting
and Posting: The Company and the Agents will discuss, from time to
time, the aggregate principal amounts of, the
Maturities, the Issue Price and the interest rates to be
borne by Notes that may be sold as a result of the
solicitation of orders by the Agents. If the Company
decides to set interest rates borne by any Notes in
respect of which the Agents are to solicit orders (the
setting of such interest rates to be referred to herein
as "Posting," and the day on which rates are posted is
referred to herein as the "Posting Day") or if the
Company decides to change interest rates previously
posted by it, it will promptly advise the Agents of the
prices and interest rates to be posted.
The Company will assign a separate CUSIP number for each
tranche of Notes to be posted, and will so advise and
notify the Trustee and Purchasing Agent of said
assignment by telephone and/or by telecopier or other
form of electronic transmission. The Purchasing Agent
will, in turn, include the assigned CUSIP number on all
Posting notices communicated to the Agents and Selling
Group members.
Offering of Notes: In the event that there is a Posting, the Purchasing
Agent will communicate to each of the Agents and Selling
Group members the aggregate principal amount and
Maturities of, along with the interest rates to be borne
by, each tranche of Notes that is the subject of the
Posting. Thereafter, the Purchasing Agent, along with
the other Agents and the Selling Group, will solicit
offers to purchase the Notes accordingly.
Preparation
of Pricing
Supplement: On each Posting Day, the Company will prepare and
provide to the Purchasing Agent, by no later than 5:00
p.m. (New York City time) on such Posting Day, a Pricing
Supplement (substantially in the form attached to the
Selling Agent Agreement as Exhibit D) reflecting the
terms of the Notes that are being offered in such
Posting, and the Company and the Purchasing Agent will
cause the Pricing Supplement to be posted on the web
site for the Notes on the Posting Day, with the Pricing
Supplement positioned to immediately precede the
Prospectus.
B-8
Thereafter, the Company will file such Pricing
Supplement with the Commission in accordance with the
applicable paragraph of Rule 424(b) under the Act and
will supply a copy thereof (or additional copies if
requested) to the Purchasing Agent and one copy to the
Trustee. The Purchasing Agent will cause a Prospectus
and Pricing Supplement to be delivered to each of the
other Agents and Selling Group members that purchased
such Notes, and each of these, in turn, will pursuant to
the terms of the Selling Agent Agreement and the Master
Selected Dealer Agreement, cause to be delivered a copy
of the applicable Pricing Supplement to each purchaser
of Notes from such Agent or Selling Group member.
In each instance that a Pricing Supplement is prepared,
the Agents 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.
Purchase of Notes
by the Purchasing
Agent: The Purchasing Agent will, no later than 4:00 p.m. (New
York City time) on the sixth day subsequent to the
Posting Day, or if such sixth day is not a day on which
commercial banks in New York City are not required or
authorized to be in operation (not a "Business Day"), on
the preceding Business Day, or on such other Business
Day and time as shall be mutually agreed upon by the
Company and the Agents (any such day, a "Trade Day"),
(i) complete, execute and deliver to the Company a Terms
Agreement that sets forth, among other things, the
amount of each tranche that the Purchasing Agent is
offering to purchase or (ii) inform the Company that
none of the Notes of a particular tranche will be
purchased by the Purchasing Agent.
Acceptance
and Rejection
of Orders: Unless otherwise agreed by the Company and the Agents,
the Company has the sole right to accept orders to
purchase Notes and may reject any such order in whole or
in part. Unless otherwise instructed by the Company, the
Purchasing Agent will promptly advise the Company by
telephone of all offers to purchase Notes received by
it, other than those rejected by it in whole or in part
in the reasonable exercise of its discretion. No order
for less than $1,000 principal amount of Notes will be
accepted.
Upon receipt of a completed and executed Terms Agreement
from the Purchasing Agent, the Company will (i) promptly
execute and return such Terms Agreement to the
Purchasing Agent or (ii) inform the Purchasing Agent
that its offer to purchase the Notes of a particular
tranche has been rejected, in whole or in part. The
Purchasing Agent will
B-9
thereafter promptly inform the other Agents and
participating Selling Group members of the action taken
by the Company.
Delivery of
Confirmation and
Prospectus to
Purchaser by
Purchasing
Agent: Subject to "Suspension of Solicitation; Amendment or
Supplement" below, the Agents will deliver a Prospectus
(including the Pricing Supplement) as herein described
with respect to each Note sold by it.
For each offer to purchase a Note solicited by an Agent
and accepted by or on behalf of the Company, the
Purchasing Agent will issue a confirmation to the
purchaser, setting forth the terms of such Note and
other applicable details described above and delivery
and payment instructions. In addition, the Purchasing
Agent will deliver to such purchaser the Prospectus
(including the applicable Pricing Supplement) in
relation to such Note prior to or together with the
earlier of any written offer of such Note, delivery of
the confirmation of sale or delivery of the Note.
Settlement: The receipt of immediately available funds by the
Company in payment for Notes and the authentication and
issuance of the Global Note representing such Notes
shall constitute "Settlement" with respect to such Note.
All orders accepted by the Company will be settled
within one to three Business Days pursuant to the
timetable for Settlement set forth below, unless the
Company and the purchaser agree to Settlement on a later
date, and shall be specified upon acceptance of such
offer; provided, however, in all cases the Company will
notify the Trustee on the date issuance instructions are
given.
Settlement
Procedures: In the event of a purchase of Notes by the Purchasing
Agent, as principal, appropriate Settlement details, if
different from those set forth below, will be set forth
in the applicable Terms Agreement to be entered into
between the Purchasing Agent and the Company pursuant to
the Selling Agent Agreement. Settlement Procedures with
regard to each Note sold by an Agent, as agent for the
Company, shall be as follows:
A. After the acceptance of an offer by the Company
with respect to a Note, the Purchasing Agent
will communicate the following details of the
terms of such offer (the "Note Sale
Information") to the Company by telephone
confirmed in writing or by facsimile
transmission or other acceptable written means:
1. Principal amount of the purchase;
B-10
2. Interest Rate;
3. Interest Payment Dates;
4. Settlement Date;
5. Maturity Date;
6. Purchase Price;
7. Purchasing Agent's commission determined
pursuant to Section IV(a) of the Selling
Agent Agreement;
8. Net proceeds to the Company;
9. Trade Date;
10. If a Note is redeemable by the Company,
such of the following as are applicable:
(i) The date on and after which such
Note may be redeemed (the
"Redemption Commencement Date"),
(ii) Initial redemption price (% of
par), and
(iii) Amount (% of par) that the initial
redemption price shall decline
(but not below par) on each
anniversary of the Redemption
Commencement Date;
11. Whether the Note has the Survivor's
Option;
12. If a Discount Note, the total amount of
original issue discount, the yield to
maturity and the initial accrual period
of original issue discount;
13. DTC Participant Number of the institution
through which the customer will hold the
beneficial interest in the Global Note;
and
14. Such other terms as are necessary to
complete the applicable form of Note.
B. The Company will confirm the previously assigned
CUSIP number to the Global Note representing
such Note and then advise the Trustee and the
Purchasing Agent by telephone (confirmed in
writing at any time on the same date) or by
telecopier or other form of electronic
transmission of the information received in
accordance with Settlement Procedure "A" above,
the assigned CUSIP number and the name of the
Purchasing Agent. Each such communication by the
Company will be deemed to constitute a
representation and warranty by the Company to
the Trustee and the Agents that (i) such Note is
then, and at the time of issuance and sale
thereof will be, duly
B-11
authorized for issuance and sale by the Company;
(ii) such Note, and the Global Note representing
such Note, will conform with the terms of the
Indenture; and (iii) upon authentication and
delivery of the Global Note representing such
Note, the aggregate principal amount of all
Notes issued under the Indenture will not exceed
the aggregate principal amount of Notes
authorized for issuance at such time by the
Company.
C. The Trustee will communicate to DTC and the
Purchasing Agent through DTC's Participant
Terminal System, a pending deposit message
specifying the following Settlement information:
1. The information received in accordance
with Settlement Procedure "A".
2. The numbers of the participant accounts
maintained by DTC on behalf of the
Trustee and the Purchasing Agent.
3. The initial Interest Payment Date for
such Note, number of days by which such
date succeeds the related DTC record date
(which term means the Regular Record
Date), and if then calculated, the amount
of interest payable on such Initial
Interest Payment Date (which amount shall
have been confirmed by the Trustee).
4. The CUSIP number of the Global Note
representing such Notes.
5. The frequency of interest.
6. Whether such Global Note represents any
other Notes issued or to be issued (to
the extent then known).
D. DTC will credit such Note to the participant
account of the Trustee maintained by DTC.
E. The Trustee will complete and deliver a Global
Note representing such Note in a form that has
been approved by the Company, the Agents and the
Trustee.
F. The Trustee will authenticate the Global Note
representing such Note and maintain possession
of such Global Note.
G. The Trustee will enter an SDFS deliver order
through DTC's Participant Terminal System
instructing DTC to (i) debit such Note to the
Trustee's participant account and credit such
Note to the participant account of the Agent
maintained by DTC and (ii) debit the settlement
account of the Agent and credit the settlement
account of the Trustee maintained by DTC, in an
amount equal to the price of such Note less the
Purchasing Agent's commission. The entry of such
a deliver order shall be deemed to constitute a
B-12
representation and warranty by the Trustee to
DTC that (a) the Global Note representing such
Note has been issued and authenticated and (b)
the Trustee is holding such Global Note pursuant
to the Certificate Agreement.
H. The Purchasing Agent will enter an SDFS deliver
order through DTC's Participant Terminal System
instructing DTC to (i) debit such Note to the
Purchasing Agent's participant account and
credit such Note to the participant accounts of
the Participants to whom such Note is to be
credited maintained by DTC and (ii) debit the
settlement accounts of such Participants and
credit the settlement account of the Purchasing
Agent maintained by DTC, in an amount equal to
the price of the Note so credited to their
accounts.
I. Transfers of funds in accordance with SDFS
deliver orders described in Settlement
Procedures "G" and "H" will be settled in
accordance with SDFS operating procedures in
effect on the Settlement Date.
X. The Trustee will credit to an account of the
Company maintained at The Chase Manhattan Bank
funds available for immediate use in an amount
equal to the amount credited to the Trustee's
DTC participant account in accordance with
Settlement Procedure "G".
K. The Trustee will send a copy of the Global Note
representing such Note by first-class mail to
the Company.
L. The Purchasing Agent will confirm the purchase
of each Note to the purchaser thereof either by
transmitting to the Participant to whose account
such Note has been credited a confirmation order
through DTC's Participant Terminal System or by
mailing a written confirmation to such
purchaser. In all cases the Prospectus, as most
recently amended or supplemented, must accompany
or precede such confirmation.
M. Each Business Day, the Trustee will send to the
Company a statement setting forth the principal
amount of Notes outstanding as of that date
under the Indenture and setting forth the CUSIP
number(s) assigned to, and a brief description
of, any orders which the Company has advised the
Trustee but which have not yet been settled.
B-13
Settlement
Procedures
Timetable: In the event of a purchase of Notes by the Purchasing
Agent, as principal, appropriate Settlement details, if
different from those set forth below will be set forth
in the applicable Terms Agreement to be entered into
between the Purchasing Agent and the Company pursuant to
the Selling Agent Agreement.
For orders of Notes solicited by an Agent, as agent, and
accepted by the Company, Settlement Procedures "A"
through "M" shall be completed as soon as possible but
not later than the respective times (New York City time)
set forth below:
Settlement: Procedure Time
--------- ----
A 4:00 p.m. on the Trade Day.
B 5:00 p.m. on the Trade Day.
C 2:00 p.m. on the Business Day before the Settlement Date.
D 10:00 a.m. on the Settlement Date.
E 12:00 p.m. on the Settlement Date.
F 12:30 p.m. on the Settlement Date.
G-H 2:00 p.m. on the Settlement Date.
I 4:45 p.m. on the Settlement Date.
X-X 5:00 p.m. on the Settlement Date
M Weekly or at the request of the Company.
NOTE: The Prospectus as most recently amended or
supplemented must accompany or precede any written
confirmation given to the customer (Settlement Procedure
"L"). Settlement Procedure "I" is subject to extension
in accordance with any extension Fedwire closing
deadlines and in the other events specified in the SDFS
operating procedures in effect on the Settlement Date.
If Settlement of a Note is rescheduled or cancelled, the
Trustee will deliver to DTC, through DTC's Participant
Terminal System, a cancellation message to such effect
by no later than 2:00 p.m., New York City time, on the
Business Day immediately preceding the scheduled
Settlement Date.
B-14
Failure to
Settle: If the Trustee fails to enter an SDFS deliver order with
respect to a Note pursuant to Settlement Procedure "G",
the Trustee may deliver to DTC, through DTC's
Participant Terminal System, as soon as practicable a
withdrawal message instructing DTC to debit such Note to
the participant account of the Trustee maintained at
DTC. DTC will process the withdrawal message; provided,
that, such participant account contains Notes having the
same terms and having a principal amount that is at
least equal to the principal amount of such Note to be
debited. If withdrawal messages are processed with
respect to all the Notes issued or to be issued
represented by a Global Note, the Trustee will cancel
such Global Note in accordance with the Indenture, make
appropriate entries in its records and so advise the
Company. The CUSIP number assigned to such Global Note
shall, in accordance with CUSIP Service Bureau
procedures, be cancelled and not immediately reassigned.
If withdrawal messages are processed with respect to one
or more, but not all, of the Notes represented by a
Global Note, the Trustee will exchange such Global Note
for two Global Notes, one of which shall represent such
Notes and shall be cancelled immediately after issuance,
and the other of which shall represent the remaining
Notes previously represented by the surrendered Global
Note and shall bear the CUSIP number of the surrendered
Global Note. If the purchase price for any Note is not
timely paid to the Participants with respect to such
Note by the beneficial purchaser thereof (or a person,
including an indirect participant in DTC, acting on
behalf of such purchaser), such Participants and, in
turn, the related Agent may enter SDFS deliver orders
through DTC's participant Terminal System reversing the
orders entered pursuant to Settlement Procedures "G" and
"H", respectively. Thereafter, the Trustee will deliver
the withdrawal message and take the related actions
described in the preceding paragraph. If such failure
shall have occurred for any reason other than default by
the Agent in the performance of its obligations
hereunder or under the Selling Agent Agreement, the
Company will reimburse the Agent on an equitable basis
for its loss of the use of funds during the period when
they were credited to the account of the Company.
Notwithstanding the foregoing, upon any failure to
settle with respect to a Note, DTC may take any actions
in accordance with its SDFS operating procedures then in
effect. In the event of a failure to settle with respect
to one or more, but not all, of Notes that were to have
been represented by a Global Note, the Trustee will
provide, in accordance with Settlement Procedures "D"
and "E", for the authentication and issuance of a Global
Note representing the other Notes to have been
represented by such Global Note and will make
appropriate entries in its records.
B-15
Procedure for
Rate Changes: Each time a decision has been reached to change rates,
the Company will promptly advise the Agents of the new
rates, who will forthwith suspend solicitation of
purchases of Notes at the prior rates. The Agents may
telephone the Company with recommendations as to the
changed interest rates.
Suspension of
Solicitation;
Amendment or
Supplement: Subject to the Company's representations, warranties and
covenants contained in the Selling Agent Agreement, the
Company may instruct the Agents to suspend at any time
for any period of time or permanently, the solicitation
of orders to purchase Notes. Upon receipt of such
instructions (which may be given orally), each Agent
will forthwith suspend solicitation until such time as
the Company has advised it that solicitation of
purchases may be resumed.
In the event that at the time the Company suspends
solicitation of purchases there shall be any orders
outstanding for settlement, the Company will promptly
advise the Agents and the Trustee whether such orders
may be settled and whether copies of the Prospectus as
in effect at the time of the suspension may be delivered
in connection with the settlement of such orders. The
Company will have the sole responsibility for such
decision and for any arrangements which may be made in
the event that the Company determines that such orders
may not be settled or that copies of such Prospectus may
not be so delivered.
If the Company decides to amend or supplement the
Registration Statement or the Prospectus, it will
promptly advise the Agents and furnish the Agents and
the Trustee with the proposed amendment or supplement
and with such certificates and opinions as are required,
all to the extent required by and in accordance with the
terms of the Selling Agent Agreement. Subject to the
provisions of the Selling Agent Agreement, the Company
may file with the Commission any supplement to the
Prospectus relating to the Notes. The Company will
provide the Agents and the Trustee with copies of any
such supplement, and confirm to the Agents that such
supplement has been filed with the Commission.
Trustee Not to
Risk Funds: Nothing herein shall be deemed to require the Trustee to
risk or expend its own funds in connection with any
payment to the Company, or the Agents or the purchasers,
it being understood by all parties that payments made by
the Trustee to either the Company or the Agents shall be
made only to the extent that funds are provided to the
Trustee for such purpose.
B-16
Advertising
Costs: The Company shall have the sole right to approve the
form and substance of any advertising an Agent may
initiate in connection with such Agent's solicitation to
purchase the Notes. The expense of such advertising will
be solely the responsibility of such Agent, unless
otherwise agreed to by the Company.
B-17
EXHIBIT C
CATERPILLAR FINANCIAL SERVICES CORPORATION
POWERNOTES(R)
TERMS AGREEMENT
__________ __, 20__
Caterpillar Financial Services Corporation
0000 Xxxx Xxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxx 00000-0000
The undersigned agrees to purchase the following aggregate principal amount of
Notes:
$_____________________
The terms of such Notes shall be as follows:
CUSIP Number: ___________
Interest Rate: _______%
Maturity Date: ______
Price to Public: ______
Agent's Concession: ________%
Reallowance: __________%
Settlement Date, Time
and Place: __________
Survivor's Option: ___________
Interest Payment Dates: ___________
Optional Redemption, if any: ___________
Initial Redemption Date: _________
Redemption Price: Initially % of Principal Amount and declining
_______% of the Principal Amount on each anniversary of the
Initial Redemption Date until the Redemption Price is 100% of the
Principal Amount.
[Any other terms and conditions agreed
to by such Agent and the Company]
[AGENT NAME]
By:
---------------------------
Name:
Title:
ACCEPTED:
CATERPILLAR FINANCIAL SERVICES CORPORATION
By:
----------------------------
Name:
Title:
C-1
EXHIBIT D
FORM OF PRICING SUPPLEMENT
Registration No. 333-______
Filed Pursuant to Rule 424(b)[(3)]
Caterpillar Financial Services Corporation
PowerNotes(R)
With Maturities of 9 Months or More from Date of Issue
--------------------------------------------------------------------------------
Pricing Supplement No. __ Trade Date: __/__/__
(To Prospectus Supplement dated [______, 20__]) Issue Date: __/__/__
The date of this Pricing Supplement is _______ __, ____
CUSIP
or Stated Interest Rate
Common Code Per Annum Maturity Date Price to Public Dealer
----------- -------------------- ------------- --------------- ------
Interest Payment
Frequency Subject to Dates and terms of redemption
(begin date) Survivor's Option Redemption (including the redemption price)
---------------- ----------------- ---------- --------------------------------
D-1
EXHIBIT E
Form of Master Selected Dealer Agreement
[Name of Broker-Dealer]
[Broker-Dealer's Address]
Dear Selected Dealer:
In connection with public offerings of securities after the date
hereof for which we are acting as manager of an underwriting syndicate or are
otherwise responsible for the distribution of securities to the public by means
of an offering of securities for sale to selected dealers, you may be offered
the right as such a selected dealer to purchase as principal a portion of such
securities. This will confirm our mutual agreement as to the general terms and
conditions applicable to your participation in any such selected dealer group
organized by us as follows.
1. Applicability of this Agreement. The terms and conditions of
this Agreement shall be applicable to any public offering of securities
("Securities") pursuant to a registration statement filed under the Securities
Act of 1933 (the "Securities Act") or exempt from registration thereunder (other
than a public offering of Securities effected wholly outside the United States
of America), wherein [Agent Name] (acting for its own account or for the account
of any underwriting or similar group or syndicate) is responsible for managing
or otherwise implementing the sale of the Securities to selected broker-dealers
("Selected Dealers") and has expressly informed you that such terms and
conditions shall be applicable. Any such offering of Securities to you as a
Selected Dealer is hereinafter called an "Offering". In the case of any Offering
where we are acting for the account of any underwriting or similar group or
syndicate ("Underwriters"), the terms and conditions of this Agreement shall be
for the benefit of, and binding upon, such Underwriters, including, in the case
of any Offering where we are acting with others as representatives of
Underwriters, such other representatives.
2. Conditions of Offering; Acceptance and Purchases. Any
Offering will be subject to delivery of the Securities and their acceptance by
us and any other Underwriters, may be subject to the approval of all legal
matters by counsel and the satisfaction of other conditions, and may be made on
the basis of reservation of Securities or an allotment against subscription. We
will advise you by telegram, telex or other form of written communication
("Written Communication", which term, in the case of any Offering described in
Section 3(a) or 3(b) hereof, may include a prospectus or offering circular) of
the particular method and supplementary terms and conditions (including, without
limitation, the information as to prices and offering date referred to in
Section 3(c) hereof) of any Offering in which you are invited to participate. To
the extent such supplementary terms and conditions are inconsistent with any
provision herein, such terms and conditions shall supersede any such provision.
Unless otherwise indicated in any such Written Communication, acceptances and
other communications by you with respect to an Offering should be sent to [Agent
Name], [Agent Address] (Telecopy: (___) ___-____). We reserve the right to
reject any acceptance in whole or in part. Unless notified otherwise by us,
Securities purchased by you shall be paid for on such date as we shall
E-1
determine, on one business day's prior notice to you, by certified or official
bank check, in an amount equal to the Public Offering Prices (as hereinafter
defined) or, if we shall so advise you, at such Public Offering Price less the
Concession (as hereinafter defined), payable in immediately available funds to
the order of [Agent Name], against delivery of the Securities. If Securities are
purchased and paid for at such Public Offering Price, such Concession will be
paid after the termination of the provisions of Section 3(c) hereof with respect
to such Securities. Notwithstanding the foregoing, unless notified otherwise by
us, payment for and delivery of Securities purchased by you shall be made
through the facilities of The Depository Trust Company, if you are a member,
unless you have otherwise notified us prior to the date specified in a Written
Communication to you from us or, if you are not a member, settlement may be made
through a correspondent who is a member pursuant to instructions which you will
send to us prior to such specified date.
3. Representations, Warranties and Agreements.
(a) Registered Offerings. In the case of any Offering of
Securities that are registered under the Securities Act ("Registered Offering"),
we shall provide you with such number of copies of each preliminary prospectus
and of the final prospectus relating thereto as you may reasonably request for
the purposes contemplated by the Securities Act and the Securities Exchange Act
of 1934 (the "Exchange Act") and the applicable rules and regulations of the
Securities and Exchange Commission thereunder. You represent and warrant that
you are familiar with Rule 15c2-8 under the Exchange Act relating to the
distribution of preliminary and final prospectuses and agree that you will
comply therewith. You agree to make a record of your distribution of each
preliminary prospectus and, when furnished with copies of any revised
preliminary prospectus, you will, upon our request, promptly forward copies
thereof to each person to whom you have theretofore distributed a preliminary
prospectus. You agree that in purchasing Securities in a Registered Offering you
will rely upon no statement whatsoever, written or oral, other than the
statements in the final prospectus delivered to you by us. You will not be
authorized by the issuer or other seller of Securities offered pursuant to a
prospectus or by any Underwriter to give any information or to make any
representation not contained in the prospectus in connection with the sale of
such Securities.
(b) Offerings Pursuant to Offering Circular. In the case of any
Offering of Securities, other than a Registered Offering, which is made pursuant
to an offering circular or other document comparable to a prospectus in a
Registered Offering, including, without limitation, an Offering of "exempted
securities" as defined in Section 3(a)(12) of the Exchange Act (an "Exempted
Securities Offering"), we shall provide you with such number of copies of each
preliminary offering circular and of the final offering circular relating
thereto as you may reasonably request. You agree that you will comply with the
applicable Federal and state laws, and the applicable rules and regulations of
any regulatory body promulgated thereunder, governing the use and distribution
of offering circulars by brokers or dealers. You agree that in purchasing
Securities pursuant to an offering circular you will rely upon no statements
whatsoever, written or oral, other than the statements in the final offering
circular delivered to you by us. You will not be authorized by the issuer or
other seller of Securities offered pursuant to an offering circular or by any
Underwriter to give any information or to make any representation not contained
in the offering circular in connection with the sale of such Securities.
E-2
(c) Offer and Sale to the Public. With respect to any Offering
of Securities, we will inform you by a Written Communication of the public
offering price, the selling concession, the reallowance (if any) to
broker-dealers and the time when you may commence selling Securities to the
public. After such public offering has commenced, we may change the public
offering price, the selling concession and the reallowance (if any) to
broker-dealers. The offering price, selling concession and reallowance (if any)
to dealers at any time in effect with respect to an Offering are hereinafter
referred to, respectively, as the "Public Offering Price", the "Concession" and
the "Reallowance". With respect to each Offering of Securities, until the
provisions of this Section 3(c) shall be terminated pursuant to Section 5
hereof, you agree to offer Securities to the public at no more than the Public
Offering Price. If notified by us, you may sell securities to the public at a
lesser negotiated price than the Public Offering Price, but in an amount not to
exceed the Concession. If a Reallowance is in effect, a reallowance from the
Public Offering Price not in excess of such Reallowance may be allowed as
consideration for services rendered in distribution to broker-dealers (i) who
are actually engaged in the investment banking or securities business, (ii) who
execute the written agreement prescribed by Rule 2740(c) of the Conduct Rules of
the National Association of Securities Dealers. Inc. (the "NASD") and (iii) who,
if they are foreign banks, broker-dealers or institutions not eligible for
membership in the NASD, represent to you that they will promptly reoffer such
Securities at the Public Offering Price and will abide by the conditions with
respect to foreign banks, broker-dealers and institutions set forth in Section
3(e) hereof.
(d) Over-allotment; Stabilization; Unsold Allotments. We may,
with respect to any Offering, be authorized to over-allot in arranging sales to
Selected Dealers, to purchase and sell Securities for long or short account and
to stabilize or maintain the market price of the Securities. You agree not to
purchase and sell Securities for which an order from a client has not been
received without our consent in each instance. You further agree that, upon our
request at any time and from time to time prior to the termination of the
provisions of Section 3(c) hereof with respect to any Offering, you will report
to us the amount of Securities purchased by you pursuant to such Offering which
then remain unsold by you and will, upon our request at any such time, sell to
us for our account or the account of one or more Underwriters such amount of
such unsold Securities as we may designate at the Public Offering Price less an
amount to be determined by us not in excess of the Concession. If, prior to the
later of (i) the termination of the provisions of Section 3(c) hereof with
respect to any Offering or (ii) the covering by us of any short position created
by us in connection with such Offering for our account or the account of one or
more Underwriters, we purchase or contract to purchase for our account or the
account of one or more Underwriters in the open market or otherwise any
Securities purchased by you under this Agreement as part of such Offering, you
agree to pay us on demand an amount equal to the Concession with respect to such
Securities (unless you shall have purchased such Securities pursuant to Section
2 hereof at the Public Offering Price in which case we shall not be obligated to
pay such Concession to you pursuant to Section 2) plus transfer taxes and
broker's commissions or dealer's mark-up, if any, paid in connection with such
purchase or contract to purchase.
(e) NASD. You represent and warrant that you are actually
engaged in the investment banking or securities business. In addition, you
further represent and warrant that you are either (i) a member in good standing
of the NASD, (ii) a foreign bank, broker-dealer or institution not eligible for
membership in the NASD which agrees not to make any sales within
E-3
the United States, its territories or its possessions or to persons who are
citizens thereof or residents therein, and in making any other sales to comply
with the NASD's interpretation with respect to free riding and withholding, or
(iii), solely in connection with an Exempted Securities Offering, a bank, as
defined in Section 3(a)(6) of the Exchange Act, that does not otherwise fall
within provision (i) or (ii) of this sentence (a "Bank"). You further represent,
by your participation in an Offering, that you have provided to us all documents
and other information required to be filed with respect to you, any related
person or any person associated with you or any such related person pursuant to
the supplementary requirements of the NASD's interpretation with respect to
review of corporate financing as such requirements relate to such Offering.
You agree that, in connection with any purchase or sale of the
Securities wherein a selling Concession, discount or other allowance is received
or granted, (1) you will comply with the provisions of Rule 2740 of the Conduct
Rules of the NASD, (2) if you are a non-NASD member broker or dealer in a
foreign country, you will also comply (a), as though you were an NASD member,
with the provision of Rules 2730, 2740 and 2750 of the Conduct Rules and (b)
with Rule 2420 of the Conduct Rules as that Rule applies to a non-NASD member
broker or dealer in a foreign country and (3), in connection with an Exempted
Securities Offering, if you are a Bank, you will also comply, as though you were
an NASD member, with the provision of Rules 2730, 2740 and 2750 of the Conduct
Rules.
You further agree that, in connection with any purchase of
securities from us that is not otherwise covered by the terms of this Agreement
(whether we are acting as manager, as a member of an underwriting syndicate or a
selling group or otherwise), if a selling Concession, discount or other
allowance is granted to you, clauses (1), (2) and (3) of the preceding paragraph
will be applicable.
(f) Relationship among Underwriters and Selected Dealers. We may
buy Securities from or sell Securities to any Underwriter or Selected Dealer and
the Underwriters (if any) and the Selected Dealers may purchase Securities from
and sell Securities to each other at the Public Offering Price less all or any
part of the Reallowance. You are not authorized to act as agent for us, any
Underwriter or the issuer or other seller of any Securities in offering
Securities to the public or otherwise. Neither we nor any Underwriter shall be
under any obligation to you except for obligations assumed hereby or in any
Written Communication from us in connection with any Offering. Nothing contained
herein or in any Written Communication from us shall constitute the Selected
Dealers an association or partners with us or any Underwriter or with one
another. If the Selected Dealers, among themselves or with the Underwriters,
should be deemed to constitute a partnership for Federal income tax purposes,
then you elect to be excluded from the application of Subchapter K, Chapter 1,
Subtitle A of the Internal Revenue Code of 1986 and agree not to take any
position inconsistent with that election. You authorize us, in our discretion,
to execute and file on your behalf such evidence of that election as may be
required by the Internal Revenue Service. In connection with any Offering, you
shall be liable for your proportionate amount of any tax, claim, demand or
liability that may be asserted against you alone or against one or more Selected
Dealers (including you) participating in such Offering, or against us or the
Underwriters, based upon the claim that the Selected Dealers, or any of them,
constitute an association, an unincorporated business or other entity,
including, in
E-4
each case, your proportionate amount of any expense incurred in defending
against any such tax, claim, demand or liability.
(g) Blue Sky Laws. Upon application to us, we shall inform you
as to any advice we have received from counsel concerning the jurisdictions in
which Securities have been qualified for sale or are exempt under the securities
or blue sky laws of such jurisdictions, but we do not assume any obligation or
responsibility as to your right to sell Securities in any such jurisdiction.
(h) Compliance with Law. You agree that in selling Securities
pursuant to any Offering (which agreement shall also be for the benefit of the
issuer or other seller of such Securities) you will comply with all applicable
laws, rules and regulations, including the applicable provisions of the
Securities Act and the Exchange Act, the applicable rules and regulations of the
Securities and Exchange Commission thereunder, the applicable rules and
regulations of the NASD, the applicable rules and regulations of any securities
exchange having jurisdiction over the Offering and the applicable laws, rules
and regulations specified in Section 3(b) hereof.
(i) Registration of the Securities. You are aware that no action
has been or will be taken by the issuer of the Securities that would permit the
offer or sale of the Securities or possession or distribution of the Prospectus
or any other offering material relating to the Securities in any jurisdiction
where action for that purpose is required, other than registering the Securities
under the Securities Act in the case of a Registered Offering. Accordingly, you
agree that you will observe all applicable laws and regulations in each
jurisdiction in or from which you may directly or indirectly acquire, offer,
sell, or deliver Securities or have in your possession or distribute the
Prospectus or any other offering material relating to the Securities, and you
will obtain any consent, approval or permission required by you for the
purchase, offer, or sale by you of the Securities under the laws and regulations
in force in any such jurisdiction to which you are subject or in which you make
such purchase, offer, or sale. Neither the issuer of the Securities nor AAFS or
any Selected Dealers or Underwriters shall have any responsibility for
determining what compliance is necessary by you or for your obtaining such
consents, approvals, or permissions. You further agree that you will take no
action that will impose any obligations on the issuer of the Securities, AAFS,
or any Selected Dealers or Underwriters. Subject as provided above, you shall,
unless prohibited by applicable law, furnish to each person to whom you offer,
sell or deliver Securities a copy of the Prospectus (as then amended or
supplemented) or (unless delivery of the Prospectus is required by applicable
law) inform each such person that a copy thereof (as then amended or
supplemented) will be made available upon request. You are not authorized to
give any information or to make any representation not contained in the
Prospectus or the documents incorporated by reference or specifically referred
to therein in connection with the offer and sale of the Securities. In the case
of an Exempted Securities Offering, all references to "Prospectus" in this
section shall be interpreted to mean "offering circular."
4. Indemnification. You agree to indemnify and hold harmless
[Agent Name], the issuer of the Securities, each person, if any, who controls
(within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act) [Agent Name] or the issuer of the Securities, and their
respective directors, officers and employees from and against any and all
losses, liabilities, costs or claims (or actions in respect thereof)
(collectively, "Losses") to which any of them may become subject (including all
reasonable costs of investigating, disputing or defending any such claim or
action), insofar as such Losses arise out of or are in connection with the
breach of any representation, warranty or agreement made by you herein.
If any claim, demand, action or proceeding (including any
governmental investigation) shall be brought or alleged against an indemnified
party in respect of which indemnity is to be sought against an indemnifying
party, the indemnified party shall promptly notify the indemnifying party in
writing, and the indemnifying party, upon request of the indemnified party,
shall retain counsel reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the indemnified party may
designate in such proceeding and shall pay the reasonable fees and expenses 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 reasonable 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, (ii) the indemnifying party has failed
within a reasonable time to retain counsel reasonably satisfactory to such
indemnified party or (iii) 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
agreed that the indemnifying party shall not, in connection with any proceeding
or related proceedings in the same jurisdiction, be liable for the reasonable
fees and expenses of more than one separate law firm (in addition to local
counsel where necessary) for all such indemnified parties. Such firm shall be
designated in writing by the indemnified party. The indemnifying party shall not
be liable for any settlement of any proceeding
E-5
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. 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
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
The indemnity agreements contained in this Section and the
representations and warranties by you in this Agreement shall remain operative
and in full force and effect regardless of: (i) any termination of this
Agreement; (ii) any investigation made by an indemnified party or on such
party's behalf or any person controlling an indemnified party or by or on behalf
of the indemnifying party, its directors or officers or any person controlling
the indemnifying party; and (iii) acceptance of and payment for any Securities.
5. Termination, Supplements and Amendments. This Agreement constitutes the
entire agreement of the parties with regard to the subject matter hereof and
supercedes all prior oral or written agreements between the parties hereto or
their predecessors with regard to the subject matter hereof. This Agreement may
be terminated by Written Communication from you to AAFS or from AAFS to you.
Until so terminated, this Agreement shall continue in full force and effect.
This Agreement may be supplemented or amended by us by written notice thereof to
you, and any such supplement or amendment to this Agreement shall be effective
with respect to any Offering to which this Agreement applies after the date you
received such supplement or amendment. Each reference to "this Agreement" herein
shall, as appropriate, be to this Agreement as so amended and supplemented. The
terms and conditions set forth in Section 3(c) hereof with regard to any
Offering will terminate at the close of business on the 30th day after the
commencement of the public offering of the Securities to which such Offering
relates, but in our discretion may be extended by us for a further period not
exceeding 30 days and in our discretion, whether or not extended, may be
terminated at any earlier time.
6. Successors and Assigns. This Agreement shall be binding on,
and inure to the benefit of, the parties hereto and other persons specified in
Section 1 hereof, and the respective successors and assigns of each of them.
7. Governing Law. This Agreement and the terms and conditions
set forth herein with respect to any Offering together with such supplementary
terms and conditions with respect to such Offering as may be contained in any
Written Communication from us to you in connection therewith shall be governed
by, and construed in accordance with, the laws of the State of New York.
E-6
Please confirm by signing and returning to us the enclosed copy
of this Agreement that your subscription to, or your acceptance of any
reservation of, any Securities pursuant to an Offering shall constitute (i)
acceptance of and agreement to the terms and conditions of this Agreement (as
supplemented and amended pursuant to Section 5 hereof) together with and subject
to any supplementary terms and conditions contained in any Written Communication
from us in connection with such Offering, all of which shall constitute a
binding agreement between you and us, individually or as representative of any
Underwriters, (ii) confirmation that your representations and warranties set
forth in Section 3 hereof are true and correct at that time, (iii) confirmation
that your agreements set forth in Sections 2 and 3 hereof have been and will be
fully performed by you to the extent and at the times required thereby and (iv)
in the case of any Offering described in Section 3(a) and 3(b) hereof,
acknowledgment that you have requested and received from us sufficient copies of
the final prospectus or offering circular, as the case may be, with respect to
such Offering in order to comply with your undertakings in Section 3(a) or 3(b)
hereof.
Very truly yours,
[AGENT NAME]
By:
---------------------------------
Name:
-------------------------------
Title:
------------------------------
CONFIRMED: ________ __, 20__
(NAME OF BROKER-DEALER)
By:
----------------------------
Name:
--------------------------
Title:
----------------------------
E-7
