EXHIBIT 1.2
CPC International Inc.
U.S. $500,000,000 Medium-Term Notes, Series F
Due More Than Nine Months
From Date of Issue
Selling Agency Agreement
, 1997
New York, New York
SALOMON BROTHERS INC XXXXXXX LYNCH, XXXXXX, XXXXXX
Seven World Trade Center & XXXXX INCORPORATED
New York, New York 10048 World Financial Center-North
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
CPC International Inc., a Delaware corporation (the "Company"), confirms
the agreement with each of you with respect to the issuance and sale by the
Company of up to $500,000,000 aggregate principal amount of its Medium-Term
Notes, Series F, Due More Than Nine Months from Date of Issue (the "Notes"). The
Notes will be issued under an indenture dated as of April 15, 1988 as amended
and supplemented by the First Supplemental Indenture and Amendment dated as of
March 2, 1994 (together, the "Indenture") between the Company and Bankers Trust
Company, as trustee (the "Trustee"). Unless otherwise specifically provided for
and set forth in a Pricing Supplement (as defined below), the Notes will be
issued in minimum denominations of $1,000 and in denominations exceeding such
amount by integral multiples of $1,000, or the equivalent thereof in a specified
currency of a country other than the United States or in a composite currency
and in any greater denomination that is an integral multiple of $1,000 of such
specified currency or composite currency. References herein to "$" shall be to
United States dollars, and references herein to amounts in United States dollars
shall be deemed to refer to the equivalent amount of currencies of countries
other than the United States or composite currencies to the extent applicable.
The Notes will be issued only in fully registered form and will
2
have the interest rates, maturities and, if applicable, other terms set forth in
such Pricing Supplement. The Notes will be issued, and the terms thereof
established, in accordance with the Indenture and the Medium-Term Notes
Administrative Procedures attached hereto as Exhibit A (the "Procedures")
(unless a Terms Agreement (as defined in Section 2(b)) modifies or otherwise
supersedes such Procedures with respect to the Notes issued pursuant to such
Terms Agreement). The Procedures may be amended only by written agreement of the
Company and you after notice to, and with the approval of, the Trustee. For the
purposes of this Agreement, the term "Agent" shall refer to either of you (or
any additional parties appointed pursuant to Section 13 hereof) acting solely in
the capacity as agent for the Company pursuant to Section 2(a) and not as
principal (collectively, the "Agents"), the term "Purchaser" shall refer to
either of you (or any additional parties specified in accordance with Section
2(a)) acting solely as principal pursuant to Section 2(b) and not as agent, and
the term "you" shall refer to both of you (and any such additional parties)
collectively whether at any time either of you is acting in both such capacities
or in either such capacity. In acting under this Agreement, in whatever
capacity, each of you is acting individually and not jointly.
1. Representations and Warranties. The Company represents and warrants to,
and agrees with, you as set forth below in this Section 1. Certain terms used in
this Section 1 are defined in paragraph (d) hereof.
a. The Company meets the requirements for use of Form S-3 under the
Securities Act of 1933, as amended (the "Act"), and has filed with the
Securities and Exchange Commission (the "Commission") a registration
statement on such Form (File Number: 333- ), including a basic prospectus,
which has become effective, for the registration under the Act of
$500,000,000 aggregate principal amount of debt securities (the
"Securities"). Such registration statement, as amended at the date of this
Agreement, meets the requirements set forth in Rule 415(a)(1)(ix) or (x)
under the Act and complies in all other material respects with said Rule.
The Company has included in such registration statement, or has filed or
will file with the Commission pursuant to the applicable paragraph of Rule
424(b) under the Act, a supplement to the form of prospectus included in
such registration statement relating to the Notes, and the plan of
distribution thereof (the "Prospectus Supplement"). In connection with the
sale of Notes, the Company proposes to
3
file with the Commission pursuant to the applicable paragraph of Rule
424(b) under the Act further supplements to the Prospectus Supplement (each
a "Pricing Supplement") specifying the interest rates, maturity dates and,
if appropriate, other similar terms of the Notes sold pursuant hereto or
the offering thereof.
b. As of the Execution Time (as defined below), on the Effective Date
(as defined below), when any supplement to the Prospectus is filed with the
Commission, as of the date of a Terms Agreement and at the date of delivery
by the Company of any Notes sold hereunder (a "Closing Date"), (i) the
Registration Statement, as amended as of any such time, and the Prospectus,
as supplemented as of any such time, and the Indenture will comply in all
material respects with the applicable requirements of the Act, the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the
respective rules thereunder; (ii) the Registration Statement, as amended as
of any such time, did not or will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein not
misleading; and (iii) the Prospectus, as supplemented as of any such time,
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;
provided, however, that the Company makes no representations or warranties
as to (i) that part of the Registration Statement that shall constitute the
Statement of Eligibility (Form T-1) under the Trust Indenture Act of the
Trustee or (ii) the information contained in or omitted from the
Registration Statement or the Prospectus (or any supplement thereto) in
reliance upon and in conformity with information furnished in writing to
the Company by any of you specifically for inclusion in the Registration
Statement or the Prospectus (or any supplement thereto).
c. As of the time any Notes are issued and sold hereunder, the
Indenture will constitute a legal, valid and binding instrument enforceable
against the Company in accordance with its terms and such Notes will have
been duly authorized, executed, authenticated and, when paid for by the
purchasers thereof, will constitute legal,
4
valid and binding obligations of the Company entitled to the benefits of
the Indenture.
d. The terms that follow, when used in this Agreement, shall have the
meanings indicated. The term "the Effective Date" shall mean each date that
the Registration Statement and any post-effective amendment or amendments
thereto became or become effective and each date after the date hereof on
which a document incorporated by reference in the Registration Statement is
filed. "Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto. "Basic Prospectus" shall mean
the form of basic prospectus relating to the Securities contained in the
Registration Statement at the Effective Date. "Prospectus" shall mean the
Basic Prospectus as supplemented by the Prospectus Supplement and, if the
context so requires, the applicable Pricing Supplement. "Registration
Statement" shall mean the registration statement referred to in the first
sentence of paragraph (a) above, including incorporated documents, exhibits
and financial statements, as amended at the Execution Time. "Rule 415" and
"Rule "424", refer to such rules under the Act. Any reference herein to the
Registration Statement, the Basic Prospectus, the Prospectus Supplement or
the Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Item 12 of Form S-3 which
were filed under the Exchange Act on or before the Effective Date of the
Registration Statement or the issue date of the Basic Prospectus, the
Prospectus Supplement or the Prospectus, as the case may be; and any
reference herein to the terms "amend," "amendment" or "supplement" with
respect to the Registration Statement, the Basic Prospectus, the Prospectus
Supplement or the Prospectus shall be deemed to refer to and include the
filing of any document under the Exchange Act after the Effective Date of
the Registration Statement or the issue date of the Basic Prospectus, the
Prospectus Supplement or the Prospectus, as the case may be, deemed to be
incorporated therein by reference.
2. Appointment of Agents; Solicitation by the Agents of Offers To Purchase;
Sales of Notes to a Purchaser. a. Subject to the terms and conditions set forth
herein, the Company hereby authorizes each of the Agents to act as its agent to
solicit offers for the purchase of all or part of the Notes from the Company.
5
On the basis of the representations and warranties, and subject to the
terms and conditions, set forth herein, each of the Agents agrees, as agent of
the Company, to use its reasonable efforts to solicit offers to purchase the
Notes from the Company upon the terms and conditions set forth in the Prospectus
(and any supplement thereto) and in the Procedures. Each Agent shall make
reasonable efforts to assist the Company in obtaining performance by each
purchaser whose offer to purchase Notes has been solicited by such Agent and
accepted by the Company, but such Agent shall not, except as otherwise provided
in this Agreement, be obligated to disclose the identity of any purchaser or
have any liability to the Company in the event any such purchase is not
consummated for any reason. Except as provided in Section 2(b), under no
circumstances will any Agent be obligated to purchase any Notes for its own
account. It is understood and agreed, however, that any Agent may purchase Notes
as principal pursuant to Section 2(b).
The Company reserves the right, in its sole discretion, to instruct the
Agents to suspend at any time, for any period of time or permanently, the
solicitation of offers to purchase Notes. Upon receipt of instructions from the
Company, the Agents will forthwith suspend solicitation of offers to purchase
Notes from the Company until such time as the Company has advised them that such
solicitation may be resumed.
The Company agrees to pay each Agent a commission' on the Closing Date with
respect to each sale of Notes by the Company as a result of a solicitation made
by such Agent, in an amount equal to that percentage specified in Schedule I
hereto of the aggregate principal amount of the Notes sold by the Company. Such
commission shall be payable as specified in the Procedures.
Subject to the provisions of this Section and to the Procedures, offers for
the purchase of Notes may be solicited by an Agent as agent for the Company at
such time and in such amounts as such Agent deems advisable. The Company
reserves the right to sell Notes directly to investors on its own behalf and to
add additional agents pursuant to Section 13. The Company may accept offers to
purchase Notes through an agent other than an Agent, provided that (i) the
Company shall not have solicited such offers, (ii) such agent is engaged on the
same terms and conditions (including, without limitation, commission rates) as
those contained in (without being required to become a party hereto) this
Agreement and (iii) the Company shall give the Agents notice of such
transaction.
6
If the Company shall default in its obligations to deliver Notes to a
purchaser whose offer it has accepted, the Company shall indemnify and hold each
of you harmless against any loss, claim or damage arising from or as a result of
such default by the Company.
b. Subject to the terms and conditions stated herein, whenever the Company
and any of you determine that the Company shall sell Notes directly to any of
you as principal, each such sale of Notes shall be made in accordance with the
terms of this Agreement and a supplemental agreement relating to such sale. Each
such supplemental agreement (which may be either an oral or written agreement)
is herein referred to as a "Terms Agreement." Each Terms Agreement shall
describe the Notes to be purchased by the Purchaser pursuant thereto and shall
specify the aggregate principal amount of such Notes, the price to be paid to
the Company for such Notes, the maturity date of such Notes, the rate at which
interest will be paid on such Notes, the dates on which interest will be paid on
such Notes and the record date with respect to each such payment of interest,
the Closing Date for the purchase of such Notes, the place of delivery of the
Notes and payment therefor, the method of payment and any requirements for the
delivery of opinions of counsel, certificates from the Company or its officers
or a letter from the Company's independent public accountants as described in
Section 6(b). Any written Terms Agreement may be in the form attached hereto as
Exhibit B. The Purchaser's commitment to purchase Notes shall be deemed to have
been made on the basis of the representations and warranties of the Company
herein contained and shall be subject to the terms and conditions herein set
forth.
Delivery of the certificates for Notes sold to the Purchaser pursuant to a
Terms Agreement shall be made not later than the Closing Date agreed to in such
Terms Agreement, against payment of funds to the Company in the net amount due
to the Company for such Notes by the method and in the form set forth in the
Procedures unless otherwise agreed to between the Company and the Purchaser in
such Terms Agreement.
Unless otherwise agreed to between the Company and the Purchaser in a Terms
Agreement, any Note sold to a Purchaser (i) shall be purchased by such Purchaser
at a price equal to 100% of the principal amount thereof less a percentage equal
to the commission applicable to an agency sale of a Note of identical maturity
and (ii) may be resold by such Purchaser at varying prices from time to time or,
if set forth in the applicable Terms Agreement and Pricing Supplement, at a
fixed
7
public offering price. In connection with any resale of Notes purchased, a
Purchaser may use a selling or dealer group and may reallow to any broker or
dealer any portion of the discount or commission payable pursuant hereto.
3. Offering and Sale of Notes. Each Agent and the Company agree to perform
the respective duties and obligations specifically provided to be performed by
them in the Procedures.
4. Agreements. The Company agrees with you that:
a. Prior to the termination of the offering of the Notes (including by
way of resale by a Purchaser of Notes), the Company will not file any
amendment of the Registration Statement or supplement to the Prospectus
(except for (i) periodic or current reports filed under the Exchange Act,
(ii) a supplement relating to any offering of Notes providing solely for
the specification of or a change in the maturity dates, interest rates,
issuance prices or other similar terms of any Notes or (iii) a supplement
relating to an offering of Securities other than the Notes) unless the
Company has furnished each of you a copy for your review prior to filing
and given each of you a reasonable opportunity to comment on any such
proposed amendment or supplement. Subject to the foregoing sentence, the
Company will cause each supplement to the Prospectus to be filed with the
Commission pursuant to the applicable paragraph of Rule 424(b) within the
time period prescribed and will provide evidence satisfactory to you of
such filing. The Company will promptly advise each of you (i) when the
Prospectus, and any supplement thereto, shall have been filed with the
Commission pursuant to Rule 424(b), (ii) when, prior to termination of any
offering of Notes, any amendment of the Registration Statement shall have
been filed or become effective, (iii) of any request by the Commission for
any amendment of the Registration Statement or supplement to the Prospectus
or for any additional information, (iv) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration
Statement or the institution or threatening of any proceeding for that
purpose and (v) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Notes for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose. The Company will use its best efforts to prevent
8
the issuance of any such stop order and, if issued, to obtain as soon as
possible the withdrawal thereof.
b. If, at any time when a prospectus relating to the Notes is required
to be delivered under the Act, any event occurs as a result of which the
Prospectus as then supplemented would include any untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it shall be necessary to amend the Registration
Statement or to supplement the Prospectus to comply with the Act or the
Exchange Act or the respective rules thereunder, the Company promptly will
(i) notify each of you to suspend solicitation of offers to purchase Notes
(and, if so notified by the Company, each of you shall forthwith suspend
such solicitation and cease using the Prospectus as then supplemented),
(ii) prepare and file with the Commission, subject to the first sentence of
paragraph (a) of this Section 4, an amendment or supplement which will
correct such statement or omission or effect such compliance and (iii)
supply any supplemented Prospectus to each of you in such quantities as you
may reasonably request. If such amendment or supplement, and any documents,
certificates and opinions furnished to each of you pursuant to paragraph
(g) of this Section 4 in connection with the preparation or filing of such
amendment or supplement, are satisfactory in all respects to you, you will,
upon the filing of such amendment or supplement with the Commission and
upon the effectiveness of an amendment to the Registration Statement, if
such an amendment is required, resume your obligation to solicit offers to
purchase Notes hereunder.
c. The Company, during the period when a prospectus relating to the
Notes is required to be delivered under the Act, will file promptly all
documents required to be filed with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act and will furnish to each of
you copies of such documents. In addition, at the time the Company makes
any announcement to the general public concerning earnings or concerning
any other event which is required to be described, or which the Company
proposes to describe, in a document filed pursuant to the Exchange Act, the
Company will furnish to each of you the information contained in such
announcement. The Company also will furnish to each of you copies of all
press releases or announcements furnished to news or wire services and any
other material press releases and announcements.
9
The Company will immediately notify each of you of (i) any decrease in the;
rating of the Notes or any other debt securities of the Company by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act) or (ii) any notice given of any
intended or potential decrease in any such rating or of a possible change
in any such rating that does not indicate the direction of the possible
change, as soon as the Company learns of any such decrease or notice.
d. As soon practicable, the Company will make generally available to
its security holders and to each of you an earning statement or statements
of the Company and its subsidiaries which will satisfy the provisions of
Section 11(a) of the Act and Rule 158 under the Act.
e. The Company will furnish to each of you and your counsel, without
charge, copies of the Registration Statement (including exhibits thereto)
and, so long as delivery of a prospectus may be required by the Act, as
many copies of the Prospectus and any supplement thereto as you may
reasonably request.
f. The Company will arrange for the qualification of the Notes for
sale under the securities and blue sky laws of such jurisdictions as any of
you may designate (including the provisions of Florida blue sky law, if
requested, relating to issuers doing business with Cuba), will maintain
such qualifications in effect so long as required for the distribution of
the Notes, and, if requested by an Agent or Purchaser, will arrange for the
determination of the legality of the Notes for purchase by institutional
investors; provided that the Company shall not be required to qualify as a
foreign corporation or a dealer or to consent to the service of process
under the laws of any such state or to take any action which would or could
subject the Company to taxation in any state where it is not now so
subject.
g. The Company shall furnish to each of you such information,
documents, certificates of officers of the Company and opinions of counsel
for the Company relating to the business, operations and affairs of the
Company, the Registration Statement, the Prospectus, and any amendments
thereof or supplements thereto, the Indenture, the Notes, this Agreement,
the Procedures and the
10
performance by the Company of its obligations hereunder and thereunder as
any of you may from time to time and at any time prior to the termination
of this Agreement reasonably request.
h. The Company shall, whether or not any sale of the Notes is
consummated, (i) pay all expenses incident to the performance of its
obligations under this Agreement and any Terms Agreement, including the
fees and disbursements of its accountants and counsel, the cost of printing
or other production and delivery of the Registration Statement, the
Prospectus, all amendments thereof and supplements thereto, the Indenture,
this Agreement, any Terms Agreement and all other documents relating to the
offering, the cost of preparing, printing, packaging and delivering the
Notes, the fees and disbursements, including fees of counsel, incurred in
compliance with Section 4(f), the fees and disbursements of the Trustee and
the fees of any agency that rates the Notes, (ii) reimburse each of you as
requested for all out-of-pocket expenses (including without limitation
advertising expenses), if any, incurred by you in connection with this
Agreement and (iii) pay the reasonable fees and expenses of your counsel
incurred in connection with this Agreement.
i. Each acceptance by the Company of an offer to purchase Notes will
be deemed to be an affirmation that its representations and warranties
contained in this Agreement are true and correct at the time of such
acceptance, as though made at and as of such time, and a covenant that such
representations and warranties will be true and correct at the time of
delivery to the purchaser of the Notes relating to such acceptance, as
though made at and as of such time (it being understood that for purposes
of the foregoing affirmation and covenant such representations and
warranties shall relate to the Registration Statement and Prospectus as
amended or supplemented at each such time). Each such acceptance by the
Company of an offer for the purchase of Notes shall be deemed to constitute
an additional representation, warranty and agreement by the Company that,
as of the settlement date for the sale of such Notes, after giving effect
to the issuance of such Notes, of any other Notes to be issued on or prior
to such settlement date and of any other Securities to be issued and sold
by the Company on or prior to such settlement date, the aggregate amount of
Securities (including any Notes) which have been issued
11
and sold by the Company will not exceed the amount of Securities registered
pursuant to the Registration Statement. The Company will inform you
promptly upon your request of the aggregate amount of Securities registered
under the Registration Statement which remain unsold.
j. Each time that the Registration Statement or the Prospectus is
amended or supplemented (other than by an amendment or supplement (i)
relating to any offering of Securities, (ii) providing solely for the
specification of or a change in the maturity dates, the interest rates, the
issuance prices or other similar terms of any Notes sold pursuant hereto or
(iii) providing for a change the Agents deem to be immaterial), the Company
will deliver or cause to be delivered promptly to each of you a certificate
of the Company, signed by the Chairman of the Board or the President or a
Vice President and the Treasurer or Comptroller of the Company, dated the
date of the effectiveness of such amendment or the date of the filing of
such supplement, in form reasonably satisfactory to you, of the same tenor
as the certificate referred to in Section 5(e) but modified to relate to
the last day of the fiscal quarter for which financial statements of the
Company were last filed with the Commission and to the Registration
Statement and the Prospectus as amended and supplemented to the time of the
effectiveness of such amendment or the filing of such supplement.
k. Each time that the Registration Statement or the Prospectus is
amended or supplemented (other than by an amendment or supplement (i)
relating to any offering of Securities, (ii) providing solely for the
specification of or a change in the maturity dates, the interest rates, the
issuance prices or other similar terms of any Notes sold pursuant hereto,
(iii) setting forth or incorporating by reference financial statements or
other information as of and for a fiscal quarter, unless, in the case of
clause (iii) above, in the reasonable judgment of any of you, such
financial statements or other information is of such a nature that an
opinion of counsel should be furnished or (iv) providing for a change the
Agents deem to be immaterial), the Company shall furnish or cause to be
furnished promptly to each of you a written opinion of counsel of the
Company satisfactory to each of you, dated the date of the effectiveness of
such amendment or the date of the filing of such supplement, in form
satisfactory to each of you, of the same tenor as the opinion referred to
in Sections 5(b) and 5(c) but modified
12
to relate to the Registration Statement and the Prospectus as amended and
supplemented to the time of the effectiveness of such amendment or the
filing of such supplement or, in lieu of such opinion, counsel last
furnishing such an opinion to you may furnish each of you with a letter to
the effect that you may rely on such last opinion to the same extent as
though it were dated the date of such letter authorizing reliance (except
that statements in such last opinion will be deemed to relate to the
Registration Statement and the Prospectus as amended and supplemented to
the time of the effectiveness of such amendment or the filing of such
supplement).
l. Each time that the Registration Statement or the Prospectus is
amended or supplemented to include or incorporate amended or supplemental
financial information, the Company shall cause its independent public
accountants promptly to furnish each of you a letter, dated the date of the
effectiveness of such amendment or the date of the filing of such
supplement, in form satisfactory to each of you, of the same tenor as the
letter referred to in Section 5(f) with such changes as may be necessary to
reflect the amended and supplemental financial information included or
incorporated by reference in the Registration Statement and the Prospectus,
as amended or supplemented to the date of such letter; provided, however,
that, if the Registration Statement or the Prospectus is amended or
supplemented solely to include or incorporate by reference financial
information as of and for a fiscal quarter, the Company's independent
public accountants may limit the scope of such letter, which shall be
satisfactory in form to each of you, to the unaudited financial statements
and the related "Management's Discussion and Analysis of Financial
Condition and Results of Operations" unless, in the reasonable judgment of
any of you, such letter should cover other information of an accounting or
financial nature.
5. Conditions to the Obligations of the Agents. The obligations of each
Agent to solicit offers to purchase the Notes shall be subject to the accuracy
of the representations and warranties on the part of the Company contained
herein as of the Execution Time, on the Effective Date, when any supplement to
the Prospectus is filed with the Commission and as of each Closing Date, to the
accuracy of the statements of the Company made in any certificates pursuant to
the provisions hereof, to the performance by the Company of its obligations
hereunder and to the following additional conditions:
13
a. If filing of the Prospectus, or any supplement thereto, is required
pursuant to Rule 424(b), the Prospectus, and any such supplement, shall
have been filed in the manner and within the time period required by Rule
424(b); and no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall
have been instituted or threatened.
b. The Company shall have furnished to each Agent the opinion of Xxxxx
X. Xxxxxx, Esq., Vice President and General Counsel for the Company, dated
the Execution Time, to the effect that:
(i) except as specified in the Prospectus or any documents
incorporated by reference therein, each of the Company and the
subsidiaries listed on Schedule II hereto (individually a "Subsidiary"
and collectively the "Subsidiaries") has been duly incorporated and is
validly existing as a corporation in good standing under the laws of
the jurisdiction in which it is chartered or organized, with full
corporate power and authority to own its properties and conduct its
business as described in the Prospectus, and is duly qualified to do
business as a foreign corporation and is in good standing under the
laws of each jurisdiction which requires such qualification wherein it
owns or leases material properties or conducts material business;
(ii) all of the outstanding shares of capital stock of each
Subsidiary have been duly and validly authorized and issued and are
fully paid and nonassessable, and, except as otherwise set forth in
the Prospectus, all outstanding shares of capital stock of the
Subsidiaries are owned by the Company either directly or through
wholly owned subsidiaries free and clear of any perfected security
interest and, to the knowledge of such counsel, after due inquiry, any
other security interests, claims, liens or encumbrances;
(iii) the Company's authorized equity capitalization is as set
forth in the documents incorporated by reference in the Prospectus;
(iv) the Indenture has been duly authorized, executed and
delivered by the Company, has been duly
14
qualified under the Trust Indenture Act and, assuming due
authorization, execution and delivery thereof by the Trustee,
constitutes a legal, valid and binding instrument enforceable against
the Company in accordance with its terms, except as enforceability may
be limited by bankruptcy, reorganization, insolvency, moratorium or
other laws relating to or affecting creditors' rights generally, by
general equitable principles (regardless of whether such
enforceability is considered in a proceeding in equity or at law) or
by an implied covenant of good faith and fair dealing; and the Notes
have been duly authorized by the Company and, when executed and
authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the purchasers thereof, will constitute
legal, valid and binding obligations of the Company entitled to the
benefits of the Indenture and enforceable against the Company in
accordance with their terms except as enforceability may be limited by
bankruptcy, reorganization, insolvency, moratorium or other laws
affecting creditors' rights generally, by general equitable principles
(regardless of whether such enforceability is considered in a
proceeding in equity or at law) or by an implied covenant of good
faith and fair dealing;
(v) to the best knowledge of such counsel, there is no pending or
threatened action, suit or proceeding before any court or governmental
agency, authority or body or any arbitrator involving the Company or
any of its subsidiaries, of a character required to be disclosed in
the Registration Statement which is not adequately disclosed in the
Prospectus, and there is no franchise, contract or other document of a
character required to be described in the Registration Statement or
Prospectus, or to be filed as an exhibit, which is not described or
filed as required; and the statements included or incorporated by
reference in the Prospectus describing any legal proceedings or
material contracts or agreements relating to the Company fairly
summarize such matters in all material respects;
(vi) the Registration Statement has become effective under the
Act; any required filing of the Prospectus, and any supplements
thereto, pursuant to Rule 424(b) has been or will be made in the
manner and within the time period required by Rule 424(b);
15
to the best knowledge of such counsel, no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or threatened; and
the Registration Statement and the Prospectus (other than the
financial statements and other financial and statistical information
contained therein, as to which such counsel need express no opinion)
comply as to form in all material respects with the applicable
requirements of the Act and the Exchange Act and the respective rules
thereunder;
(vii) this Agreement has been duly authorized, executed and
delivered by the Company;
(viii) the Notes conform in all material respects to the
description thereof contained in the Prospectus (subject to the
insertion in the Notes of the maturity dates, the interest rates and
other similar terms thereof which will be described in supplements to
the Prospectus as contemplated by the last sentence of Section 1(a) of
this Agreement);
(ix) no consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation of the
transactions contemplated herein except such as have been obtained
under the Act and such as may be required under the blue sky laws of
any jurisdiction in connection with the sale of the Notes as
contemplated by this Agreement and such other approvals (specified in
such opinion) as have been obtained;
(x) neither the execution and delivery of the Indenture not the
issue and sale of the Notes nor the consummation of any other of the
transactions herein contemplated nor the fulfillment of the terms
hereof will violate, conflict with, result in a breach of, or
constitute a default under, any law known by such counsel to be
applicable to the Company or its subsidiaries, or the charter or
by-laws of the Company or the terms of any indenture or other
agreement or instrument known to such counsel and to which the Company
or any of its subsidiaries is a party or bound or any order or
regulation known to such counsel to be applicable to the Company or
any of its subsidiaries of any court, regulatory body, administrative
agency, governmental body or arbitrator hav-
16
ing jurisdiction over the Company or any of its subsidiaries, except
for such violation, conflict, breach or default which, whether
individually or in the aggregate, would not be expected to have to
have a material adverse affect on the operations, business or
financial condition of the Company and its subsidiaries, taken as a
whole; and
(xi) no holders of securities of the Company have rights to the
registration of such securities under the Registration Statement.
In addition such counsel shall make a statement that shall include such
qualifying language as may be reasonably acceptable to each of you to the
effect that such counsel has no reason to believe that the Registration
Statement at the Effective Date or at the Execution Time contained any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus includes any untrue statement of a
material fact or omits to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the
corporate laws of the State of Delaware or the laws of the State of New
York or the United States, to the extent deemed proper and specified in
such opinion, upon the opinion of other counsel of good standing believed
to be reliable and who are satisfactory to counsel for the Agents and (B)
as to matters of fact, to the extent deemed proper, on certificates of
responsible officers of the Company and public officials. References to the
Prospectus in this paragraph (b) include any supplements thereto at the
date such opinion is rendered.
c. The Company shall have furnished to each Agent the opinion of Xxxx
Xxxxxxxxxxx, Esq., Vice President-Taxation, dated the Execution Time, to
the effect that the information contained in the Prospectus under the
caption "United States Taxation" is a fair and accurate summary of the
principal Federal income tax consequences associated with the ownership of
the Notes.
d. Each Agent shall have received from a law firm designated by the
Agents and reasonably acceptable to the
17
Company (which law firm on the execution date shall be Xxxxxx, Xxxxxxxx,
Xxxxx & Xxxxxxxx), such opinion or opinions, dated the date hereof, with
respect to the issuance and sale of the Notes, the Indenture, the
Registration Statement, the Prospectus (together with any supplement
thereto) and other related matters as the Agents may reasonably require,
and the Company shall have furnished to such counsel such documents as they
request for the purpose of enabling them to pass upon such matters.
e. The Company shall have furnished to each Agent a certificate of the
Company, signed by the Chairman of the Board or the President or a Vice
President and the Treasurer or Comptroller of the Company, dated the
Execution Time, to the effect that the signers of such certificate have
carefully examined the Registration Statement, the Prospectus, any
supplement to the Prospectus and this Agreement and that:
(i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects on and as of
the date hereof with the same effect as if made on the date hereof and
the Company has complied with all the agreements and satisfied all the
conditions on its part to be performed or satisfied as a condition to
the obligation of the Agents to solicit offers to purchase the Notes;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to the actual knowledge of such
officers, threatened; and
(iii) since the date of the most recent financial statements
incorporated by reference in the Prospectus (exclusive of any
supplement thereto), there has been no material adverse change in the
condition (financial or other), earnings, business or properties of
the Company and its subsidiaries, whether or not arising from
transactions in the ordinary course of business, except as set forth
in or contemplated in the Prospectus (exclusive of any supplement
thereto).
f. At the Execution Time, the Company's independent public accountants
shall have furnished to each Agent a
18
letter, dated the date hereof, in form and substance reasonably
satisfactory to the Agents, containing statements and information of the
type customarily included in accountants' "comfort letters" to underwriters
with respect to certain financial information relating to the Company
contained in the Registration Statement and the Prospectus.
g. Prior to the Execution Time, the Company shall have furnished to
each Agent such further information, documents, certificates and opinions
of counsel as the Agents may reasonably request.
If any of the conditions specified in this Section 5 shall not have been
fulfilled in all material respects when and as provided in this Agreement, or if
any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Agents and counsel for the Agents, this Agreement and all
obligations of any Agent hereunder may be cancelled at any time by the Agents.
Notice of such cancellation shall be given to the Company in writing or by
telephone or telegraph confirmed in writing.
The documents required to be delivered by this Section 5 shall be delivered
at the office of Xxxxxx Xxxxxx & Xxxxxxx, special counsel for the Company, at 00
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, on the date hereof.
6. Conditions to the Obligations of a Purchaser. The obligations of a
Purchaser to purchase any Notes will be subject to the accuracy of the
representations and warranties on the part of the Company herein as of the date
of the related Terms Agreement and as of the Closing Date for such Notes, to the
performance and observance by the Company of all covenants and agreements herein
contained on its part to be performed and observed and to the following
additional conditions precedent:
a. No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceedings for that purpose shall
have been instituted or threatened.
b. To the extent agreed to between the Company and the Purchaser in a
Terms Agreement, the Purchaser shall have received, appropriately updated,
(i) a certificate of the Company, dated as of the Closing Date, to the
effect set forth in Section 5(e) (except that references to the
19
Prospectus shall be to the Prospectus as supplemented as of the date of
such Terms Agreement), (ii) the opinion of counsel for the Company, dated
as of the Closing Date, to the effect set forth in Sections 5(b) and 5(c),
(iii) the opinion of counsel for the Purchaser, dated as of the Closing
Date, to the effect set forth in Section 5(d), and (iv) a letter or letters
of the independent public accountants for the Company, dated as of the
Closing Date, to the effect set forth in Section 5(f).
c. Prior to the Closing Date, the Company shall have furnished to the
Purchaser such further information, certificates and documents as the
Purchaser may reasonably request.
If any of the conditions specified in this Section 6 shall not have been
fulfilled in all material respects when and as provided in this Agreement and
the applicable Terms Agreement, or if any of the opinions and certificates
mentioned above or elsewhere in this Agreement or such Terms Agreement and
required to be delivered to the Purchaser pursuant to the terms hereof and
thereof shall not be in all material respects reasonably satisfactory in form
and substance to the Purchaser and its counsel, such Terms Agreement and all
obligations of the Purchaser thereunder and with respect to the Notes subject
thereto may be cancelled at, or at any time prior to, the respective Closing
Date by the Purchaser. Notice of such cancellation shall be given to the Company
in writing or by telephone or telegraph confirmed in writing.
7. Right of Person Who Agreed To Purchase To Refuse To Purchase. a. The
Company agrees that any person who has agreed to purchase and pay for any Note
pursuant to a solicitation by any of the Agents shall have the right to refuse
to purchase such Note if, at the Closing Date therefor, any condition set forth
in Section 5 or 6, as applicable, shall not be satisfied.
b. The Company agrees that any person who has agreed to purchase and pay
for any Note pursuant to a solicitation by any of the Agents shall have the
right to refuse to purchase such Note if, subsequent to the agreement to
purchase such Note, any change, condition or development specified in any of
Sections 9(b)(i) through (v) shall have occurred (with the reasonable judgment
of the Agent which presented the offer to purchase such Note being substituted
for any judgment of a Purchaser required therein) the effect of which is, in the
reasonable judgment of the Agent which
20
presented the offer to purchase such Note, so material and adverse as to make it
impractical or inadvisable to proceed with the sale and delivery of such Note
(it being understood that under no circumstance shall any such Agent have any
duty or obligation to the Company or to any such person to exercise the judgment
permitted to be exercised under this Section 7(b) and Section 9(b)).
8. Indemnification and Contribution. a. The Company agrees to indemnify and
hold harmless each of you, the directors, officers, employees and agents of each
of you and each person who controls each of you within the meaning of either the
Act or the Exchange Act against any and all losses, claims, damages or
liabilities, joint or several, to which you, they or any of you or them may
become subject under the Act, the Exchange Act or other Federal or state
statutory law or regulation, at common law or otherwise, insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of a material
fact contained in the registration statement for the registration of the
Securities as originally filed or in any amendment thereof, or in the Prospectus
or any preliminary Prospectus, or in any amendment thereof or supplement
thereto, or arise out of or are based upon the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and agrees to reimburse each such
indemnified party, as incurred, for any legal or other expenses reasonably
incurred by it in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the Company will not
be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance upon
and in conformity with written information furnished to the Company by any of
you specifically for inclusion therein. This indemnity agreement will be in
addition to any liability which the Company may otherwise have.
b. Each of you agrees to indemnify and hold harmless the Company, each of
its directors, each of its officers who signs the Registration Statement and
each person who controls the Company within the meaning of either the Act or the
Exchange Act, to the same extent as the foregoing indemnity from the Company to
you, but only with reference to written information relating to such of you
furnished to the Company by such of you specifically for inclusion in the
21
documents referred to in the foregoing indemnity. This indemnity agreement will
be in addition to any liability which you may otherwise have. The Company
acknowledges that the statements set forth in the last paragraph of the cover
page and in the first paragraph of the inside cover, and under the heading "Plan
of Distribution," of the Prospectus Supplement constitute the only information
furnished in writing by any of you for inclusion in the documents referred to in
the foregoing indemnity, and you confirm that such statements are correct.
c. Promptly after receipt by an indemnified party under this Section 8 of
notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under this
Section 8, notify the indemnifying party in writing of the commencement thereof;
but the failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless and to the extent it did not
otherwise learn of such action and such failure results in the forfeiture by the
indemnifying party of substantial rights and defenses and (ii) will not, in any
event, relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph (a) or (b)
above. The indemnifying party shall be entitled to appoint counsel of the
indemnifying party's choice at the indemnifying party's expense to represent the
indemnified party in any action for which indemnification is sought (in which
case the indemnifying party shall not thereafter be responsible for the fees and
expenses of any separate counsel retained by the indemnified party or parties
except as set forth below); provided, however, that such counsel shall be
reasonably satisfactory to the indemnified party. Notwithstanding the
indemnifying party's election to appoint counsel to represent the indemnified
party in an action, the indemnified party shall have the right to employ
separate counsel (including local counsel), and the indemnifying party shall
bear the reasonable fees, costs and expenses of such separate counsel if (i) the
use of counsel chosen by the indemnifying party to represent the indemnified
party would present such counsel with a conflict of interest, (ii) the actual or
potential defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to those
available to the indemnifying party, (iii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
22
indemnified party within a reasonable time after notice of the institution of
such action or (iv) the indemnifying party shall authorize the indemnified party
to employ separate counsel at the expense of the indemnifying party. An
indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding.
d. In the event that the indemnity provided in paragraph (a) or (b) of this
Section 8 is unavailable to or insufficient to hold harmless an indemnified
party for any reason, the Company and each of you agree to contribute to the
aggregate losses, claims, damages and liabilities (including legal or other
expenses reasonably incurred in connection with investigating or defending same)
(collectively "Losses") to which the Company and one or more of you may be
subject in such proportion as is appropriate to reflect the relative benefits
received by the Company and by each of you from the offering of the Notes from
which such Losses arise; provided, however, that in no case shall any of you be
responsible for any amount in excess of the commissions received by such of you
in connection with the sale of Notes from which such Losses arise (or, in the
case of Notes sold pursuant to a Terms Agreement, the aggregate commissions that
would have been received by such of you if such commissions had been payable).
If the allocation provided by the immediately preceding sentence is unavailable
for any reason, the Company and each of you shall contribute in such proportion
as is appropriate to reflect not only such relative benefits but also the
relative fault of the Company and of each of you in connection with the
statements or omissions which resulted in such Losses as well as any other
relevant equitable considerations. Benefits received by the Company shall be
deemed to be equal to the total net proceeds from the offering (before deducting
expenses) of the Notes from which such Losses arise, and benefits received by
each of you shall be deemed to be equal to the total commissions received by
such of you in connection with the sale of Notes from which such Losses arise
(or, in the case of Notes sold pursuant to a Terms Agreement, the aggregate
commissions that would have been received by such of you if such commissions had
been payable). Relative fault shall be determined by reference to whether any
alleged untrue
23
statement or omission relates to information provided by the Company or any of
you. The Company and each of you agree that it would not be just and equitable
if contribution were determined by pro rata allocation or any other method of
allocation which does not take account of the equitable considerations referred
to above. Notwithstanding the provisions of this paragraph (d), 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. For purposes of this Section 8, each person who
controls any of you within the meaning of the Act or the Exchange Act and each
director, officer, employee and agent of any of you shall have the same rights
to contribution as you and each person who controls the Company within the
meaning of either the Act or the Exchange Act, each officer of the Company who
shall have signed the Registration Statement and each director of the Company
shall have the same rights to contribution as the Company, subject in each case
to the applicable terms and conditions of this paragraph (d).
9. Termination. a. This Agreement will continue in effect until terminated
as provided in this Section 9. This Agreement may be terminated either by the
Company as to any Agent or by any of you insofar as this Agreement relates to
any Agent, by giving written notice of such termination to such Agent or the
Company, as the case may be. This Agreement shall so terminate at the close of
business on the first business day following the receipt of such notice by the
party to whom such notice is given. In the event of such termination, no party
shall have any liability to the other party hereto, except as provided in the
fourth paragraph of Section 2(a), Section 4(h), Section 8 and Section 10.
b. Each Terms Agreement shall be subject to termination in the absolute
discretion of the Purchaser, by notice given to the Company prior to delivery of
any payment for any Note to be purchased thereunder, if prior to such time (i)
there shall have occurred, subsequent to the agreement to purchase such Note,
any change, or any development involving a prospective change, in or affecting
the business or properties of the Company and its subsidiaries the effect of
which is, in the reasonable judgment of the Purchaser, so material and adverse
as to make it impractical or inadvisable to proceed with the offering or
delivery of such Note, (ii) there shall have been, subsequent to the agreement
to purchase such Note, any decrease in the rating of any of the Company's debt
securities by any "nationally recognized statistical rating
24
organization" (as defined for purposes of Rule 436(g) under the Act) or any
notice given of any intended or potential decrease in any such rating or of a
possible change in any such rating that does not indicate the direction of the
possible change, (iii) trading in the Company's Common Stock shall have been
suspended by the Commission or the New York, Midwest or Pacific Stock Exchange
or trading in securities generally on the New York Stock Exchange shall have
been suspended or limited or minimum prices shall have been established on such
Exchange, (iv) a banking moratorium shall have been declared by either Federal
or New York State authorities or (v) there shall have occurred any outbreak or
escalation of hostilities, declaration by the United States of a national
emergency or war or other calamity or crisis the effect of which on financial
markets is such as to make it, in the judgment of the Purchaser, impracticable
or inadvisable to proceed with the offering or delivery of such Notes as
contemplated by the Prospectus (exclusive of any supplement thereto).
10. Survival of Certain Provisions. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officers and of you set forth in or made pursuant to this Agreement will
remain in full force and effect, regardless of any investigation made by or on
behalf of you or the Company or any of the directors, officers, employees,
agents or controlling persons referred to in Section 8 hereof, and will survive
delivery of and payment for the Notes. The provisions of Sections 4(h) and 8
hereof shall survive the termination or cancellation of this Agreement. The
provisions of this Agreement (including without limitation Section 7 hereof)
applicable to any purchase of a Note for which an agreement to purchase exists
prior to the termination hereof shall survive any termination of this Agreement.
If at the time of termination of this Agreement any Purchaser shall own any
Notes with the intention of selling them, the provisions of Section 4 shall
remain in effect until such Notes are sold by the Purchaser.
11. Notices. All communications hereunder will be in writing and effective
only on receipt, and, if sent to any of you, will be mailed, delivered or
telegraphed and confirmed to such of you, at the address specified in Schedule I
hereto; or, if sent to the Company, will be mailed, delivered or telegraphed and
confirmed to it at International Plaza, P.O. Box 8000, Englewood Cliffs, NJ
07632, attention of the Corporate Secretary.
25
12. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto, their respective successors, the directors, officers,
employees, agents and controlling persons referred to in Section 8 hereof and,
to the extent provided in Section 7, any person who has agreed to purchase
Notes, and no other person will have any right or obligation hereunder.
13. Amendments. This Agreement may be amended or supplemented if, but only
if, such amendment or supplement is in writing and is signed by the Company and
each Agent; provided that the Company may from time to time, on 2 days prior
written notice to the Agents but without the consent of any Agent, amend this
Agreement to add as a party hereto one or more additional firms registered under
the Exchange Act, whereupon each such firm shall become an Agent hereunder on
the same terms and conditions as the other Agents that are parties hereto. The
Agents shall sign any amendment or supplement giving effect to the addition of
any such firm as an Agent under this Agreement.
14. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York.
26
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicate hereof, whereupon this
letter and your acceptance shall represent a binding agreement among the Company
and you.
Very truly yours,
CPC International Inc.
By:_______________________
Name:
Title:
The foregoing Agreement is hereby confirmed and accepted as of the date hereof.
Salomon Brothers Inc
Xxxxxxx Lynch, Xxxxxx, Xxxxxx
& Xxxxx Incorporated
By: Salomon Brothers Inc
By: __________________________
Name
Title:
By: Xxxxxxx Xxxxx, Xxxxxx, Xxxxxx
& Xxxxx Incorporated
By: __________________________
Name
Title:
SCHEDULE I
Commissions:
The Company agrees to pay each Agent a commission equal to the
following percentage of the principal amount of each Note sold on an agency
basis by such Agent:
Term Commission Rate
From 9 months to less than 1 year.......... .125%
From 1 year to less than 18 months......... .150%
From 18 months to less than 2 years........ .200%
From 2 years to less than 3 years.......... .250%
From 3 years to less than 4 years.......... .350%
From 4 years to less than 5 years.......... .450%
From 5 years to less than 6 years.......... .500%
From 6 years to less than 7 years.......... .550%
From 7 years to less than 10 years......... .600%
From 10 years to less than 15 years........ .625%
From 15 years to less than 20 years........ .650%
From 20 years to less than 30 years........ .750%
From 30 years up to and
including 40 years....................... .875%
Unless otherwise specified in the applicable Terms Agreement, the discount
or commission payable to a Purchaser shall be determined on the basis of the
commission schedule set forth above. Commissions on Notes with a stated maturity
in excess of 40 years will be negotiated at the time of sale.
Address for Notice to you:
Notices to Salomon Brothers Inc shall be directed to it at Seven World
Trade Center, New York, New York 10048, Attention of the Medium-Term Note
Department.
Notices to Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated shall be
directed to it at World Financial Center - North, 000 Xxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention of the Medium-Term Note Department.
SCHEDULE II
SUBSIDIARY JURISDICTION OF ORGANIZATION
Xxxxxx Foods Company, Inc. Delaware
Best Foods-Caribbean, Inc. Delaware
X.X. Xxxxxx, Inc. New York
Xxxxxxxxx'x, Inc. Delaware
EXHIBIT A
CPC International Inc.
Medium-Term Note Administrative Procedures
, 1997
The Medium-Term Notes, Series F, Due More Than Nine Months from Date of
Issue (the "Notes") of CPC International Inc. (the "Company") are to be offered
on a continuing basis. Salomon Brothers Inc and Xxxxxxx Lynch, Xxxxxx, Xxxxxx &
Xxxxx Incorporated, as agents (each an "Agent"), have agreed to solicit
purchases of Notes issued in fully registered form. The Agents will not be
obligated to purchase Notes for their own account. The Notes are being sold
pursuant to a Selling Agency Agreement by and among the Company and the Agents
dated the date hereof (the "Agency Agreement"). The Notes will rank equally with
all other unsecured and unsubordinated debt of the Company and have been
registered with the Securities and Exchange Commission (the "Commission"). The
Notes will be issued under an Indenture dated as of April 15, 1988 as amended
and supplemented by the First Supplemental Indenture and Amendment dated as of
March 2, 1994 (together, the "Indenture"), between the Company and Bankers Trust
Company, as trustee (the "Trustee").
The Agency Agreement provides that Notes may also be purchased by an Agent
acting solely as principal and not as agent. In the event of any such purchase,
the functions of both the Agent and the beneficial owner under the
administrative procedures set forth below shall be performed by such Agent
acting solely as principal, unless otherwise agreed to between the Company and
such Agent acting as principal.
Each Note will be represented by either a Global Security (as defined
hereinafter) delivered to the Trustee, as agent for The Depository Trust Company
("DTC"), and recorded in the book-entry system maintained by DTC (a "Book-Entry
Note") or a certificate delivered to the Holder thereof or a Person designated
by such Holder (a "Certificated Note"). Only Notes denominated and payable in
U.S. dollars may be issued as Book-Entry Notes. An owner of a Book-Entry Note
will not be entitled to receive a certificate representing such Note.
The procedures to be followed during, and the specific terms of, the
solicitation of orders by the Agents and the sale as a result thereof by the
Company are explained be-
2
low. Administrative and record-keeping responsibilities will be handled for the
Company by its Treasury 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 orders to
purchase Notes and the details of their delivery.
Administrative procedures and specific terms of the offering are explained
below. Book-Entry Notes will be issued in accordance with the administrative
procedures set forth in Part I hereof, as adjusted in accordance with changes in
DTC's operating requirements, and Certificated Notes will be issued in
accordance with the administrative procedures set forth in Part II hereof.
Unless otherwise defined herein, terms defined in the Indenture and the Notes
shall be used herein as therein defined. Notes for which interest is calculated
on the basis of a fixed interest rate, which may be zero, are referred to herein
as "Fixed Rate Notes." Notes for which interest is calculated on the basis of a
floating interest rate are referred to herein as "Floating Rate Notes." To the
extent the procedures set forth below conflict with the provisions of the Notes,
the Indenture, DTC's operating requirements or the Agency Agreement, the
relevant provisions of the Notes, the Indenture, DTC's operating requirements
and the Agency Agreement, respectively, shall control.
PART I
Administrative Procedures for
Book-Entry Notes
In connection with the qualification of the Book-Entry Notes for
eligibility in the book-entry system maintained by DTC, the Trustee will perform
the custodial, document control and administrative functions described below, in
accordance with its respective obligations under a Letter of Representations
from the Company and the Trustee to DTC dated as of the date hereof and a
Medium-Term Note Certificate Agreement between the Trustee and DTC, dated as of
October 21, 1988 and as amended to the date hereof, and its obligations as a
participant in DTC, including DTC's Same-Day Funds Settlement system ("SDFS").
Issuance: On any date of settlement (as defined
under "Settlement" below) for one or
more Book-Entry Notes, the Company will
issue a single global security in fully
registered form without coupons (a
3
"Global Security") representing up to
$200,000,000 principal amount of all
such Book-Entry Notes that have the same
original issue date, original issue
discount provisions, if any, Interest
Payment Dates, Regular Record Dates,
Interest Payment Period, redemption,
repayment and extension provisions, if
any, Maturity Date, and, in the case of
Fixed Rate Notes, interest rate, or, in
the case of Floating Rate Notes, initial
interest rate, Interest Rate Basis,
Index Maturity, Interest Reset Period,
Interest Reset Dates, Spread or Spread
Multiplier, if any, minimum interest
rate, if any, and maximum interest rate,
if any (collectively, the "Terms"). Each
Global Security will be dated and issued
as of the date of its authentication by
the Trustee. Each Global Security will
bear an original issue date, which will
be (i) with respect to an original
Global Security (or any portion
thereof), the original issue date
specified in such Global Security and
(ii) following a consolidation of Global
Securities, with respect to the Global
Security resulting from such
consolidation, the most recent Interest
Payment Date to which interest has been
paid or duly provided for on the
predecessor Global Securities,
regardless of the date of authentication
of such resulting Global Security. No
Global Security will represent (i) both
Fixed Rate and Floating Rate Book-Entry
Notes or (ii) any Certificated Note.
Identification Numbers: The Company has arranged with the CUSIP
Service Bureau of Standard & Poor's
Corporation (the "CUSIP Service Bureau")
for the reservation of a series of CUSIP
4
numbers, which series consists of
approximately 900 CUSIP numbers and
relates to Global Securities
representing Book-Entry Notes and
book-entry medium-term notes issued by
the Company with other series
designations. The Trustee, the Company
and DTC have obtained from the CUSIP
Service Bureau a written list of such
reserved CUSIP numbers. The Company will
assign CUSIP numbers to Global
Securities as described below under
Settlement Procedure "B." DTC will
notify the CUSIP Service Bureau
periodically of the CUSIP numbers that
the Company has assigned to Global
Securities. The Trustee will notify the
Company at any time when fewer than 100
of the reserved CUSIP numbers remain
unassigned to Global Securities, and, if
the Trustee deems necessary, the Company
will reserve additional CUSIP numbers
for assignment to Global Securities.
Upon obtaining such additional CUSIP
numbers, the Company shall deliver a
list of such additional CUSIP numbers to
the Trustee and DTC.
Registration: Global Securities will be issued only in
fully registered form without coupons.
Each Global Security will be registered
in the name of Cede & Co., as nominee
for DTC, on the securities register for
the Notes maintained under the
Indenture. The beneficial owner of a
Book-Entry Note (or one or more indirect
participants in DTC designated by such
owner) will designate one or more
participants in DTC (with respect to
such Book-Entry Note, the
"Participants") to act as agent or
agents for such owner in connection with
5
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 in
such Book-Entry Note in the account of
such Participants. The ownership
interest of such beneficial owner (or
such participant) in such Book-Entry
Note will be recorded through the
records of such Participants or through
the separate records of such
Participants and one or more indirect
participants in DTC.
Transfers: Transfers of a Book-Entry Note will be
accomplished by book entries made by DTC
and, in turn, by Participants (and in
certain cases, one or more indirect
participants in DTC) acting on behalf of
beneficial transferors and transferees
of such Note.
Exchanges: The Trustee may deliver to DTC and the
CUSIP Service Bureau at any time a
written notice of consolidation (a copy
of which shall be attached to the
resulting Global Security described
below) specifying (i) the CUSIP numbers
of two or more outstanding Global
Securities that represent (A) Fixed Rate
Book-Entry Notes having the same Terms
and for which interest has been paid to
the same date or (B) Floating Rate
Book-Entry Notes having the same Terms
and for which interest has been paid to
the same date, (ii) a date, occurring at
least thirty days after such written
notice is delivered and at least thirty
days before the next Interest Payment
Date for such Book-Entry Notes, on which
such Global Securities shall be
exchanged for a single replacement
6
Global Security and (iii) a new CUSIP
number, obtained from the Company, to be
assigned to such replacement Global
Security. Upon receipt of such a notice,
DTC will send to its participants
(including the Trustee) a written
reorganization notice to the effect that
such exchange will occur on such date.
Prior to the specified exchange date,
the Trustee will deliver to the CUSIP
Service Bureau a written notice setting
forth such exchange date and such new
CUSIP number and stating that, as of
such exchange date, the CUSIP numbers of
the Global Securities to be exchanged
will no longer be valid. On the
specified exchange date, the Trustee
will exchange such Global Securities for
a single Global Security bearing the new
CUSIP number and the CUSIP numbers of
the exchanged Global Securities will, in
accordance with CUSIP Service Bureau
procedures, be cancelled and not
immediately reassigned. Notwithstanding
the foregoing, if the Global Securities
to be exchanged exceed $200,000,000 in
aggregate principal amount, one Global
Security will be authenticated and
issued to represent each $200,000,000 of
principal amount of the exchanged Global
Securities and an additional Global
Security will be authenticated and
issued to represent any remaining
principal amount of such Global
Securities (see "Denominations" below).
Maturities: Each Book-Entry Note will mature on a
date more than nine months after the
Original Issue Date (as defined below)
for such Note. A Floating Rate
Book-Entry Note will mature only on an
Interest Payment Date for such Note. Any
Note denominated in Pounds Sterling will
7
mature on a date not less than one year,
nor more than five years, after its
Original Issue Date.
Denominations: Book-Entry Notes will be issued in
principal amounts of $1,000 or any
amount in excess thereof that is an
integral multiple of $1,000. Global
Securities will be denominated in
principal amounts not in excess of
$200,000,000. If one or more Book-Entry
Notes having an aggregate principal
amount in excess of $200,000,000 would,
but for the preceding sentence, be
represented by a single Global Security,
then one Global Security will be
authenticated and issued to represent
each $200,000,000 principal amount of
such Book-Entry Note or Notes and an
additional Global Security will be
authenticated and issued to represent
any remaining principal amount of such
Book-Entry Note or Notes. In such a
case, each of the Global Securities
representing such Book-Entry Note or
Notes shall be assigned the same CUSIP
number.
Interest: General. Interest, if any, on each
Book-Entry Note will accrue from the
original issue date for the first
interest period or the last date to
which interest has been paid, if any,
for each subsequent interest period, on
the Global Security representing such
Book-Entry Note, and will be calculated
and paid in the manner described in such
Book-Entry Note and in the Prospectus
(as defined in the Agency Agreement), as
supplemented by the applicable Pricing
Supplement. Unless otherwise specified
therein, each payment of interest on a
Book-Entry Note will include interest
accrued to but excluding the Interest
Payment Date (provided that, in the case
of Floating Rate Book-Entry Notes which
8
reset daily or weekly, interest payments
will include accrued interest to but
excluding the Regular Record Date
immediately preceding the Interest
Payment Date) or to but excluding
Maturity (other than a Maturity of a
Fixed Rate Book-Entry 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. Interest payable
at the Maturity of a Book-Entry Note
will be payable to the Person to whom
the principal of such Note is payable.
Standard & Poor's Corporation will use
the information received in the pending
deposit message described under
Settlement Procedure "C" below in order
to include the amount of any interest
payable and certain other information
regarding the related Global Security in
the appropriate (daily or weekly) bond
report published by Standard & Poor's
Corporation.
Regular Record Dates. The Regular Record
Date with respect to any Interest
Payment Date shall be the date (whether
or not a Business Day) fifteen calendar
days immediately preceding such Interest
Payment Date.
Interest Payment Dates on Fixed Rate
Book-Entry Notes. Unless otherwise
specified pursuant to Settlement
Procedure "A" below, interest payments
on Fixed Rate Book-Entry Notes will be
made semi-annually on May 15 and
November 15 of each year and at
Maturity; provided, however, that if an
Interest Payment Date for a Fixed Rate
Book-Entry Note is not a Business Day,
the payment due on such day shall be
9
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; provided
further, that in the case of a Fixed
Rate Book-Entry Note issued between a
Regular Record Date and an Interest
Payment Date, the first interest payment
will be made on the Interest Payment
Date following the next succeeding
Regular Record Date.
Interest Payment Dates on Floating Rate
Book-Entry Notes. Interest payments will
be made on Floating Rate Book-Entry
Notes monthly, quarterly, semi-annually
or annually. Unless otherwise agreed
upon, interest will be payable, in the
case of Floating Rate Book-Entry Notes
with a monthly Interest Payment Period,
on the third Wednesday of each month;
with a quarterly Interest Payment
Period, on the third Wednesday of March,
June, September and December of each
year; with a semi-annual Interest
Payment Period, on the third Wednesday
of the two months specified pursuant to
Settlement Procedure "A" below; and with
an annual Interest Payment Period, on
the third Wednesday of the month
specified pursuant to Settlement
Procedure "A" below; provided, however,
that if an Interest Payment Date for a
Floating Rate Book-Entry Note would
otherwise be a day that is not a
Business Day with respect to such
Floating Rate Book-Entry Note, such
Interest Payment Date will be the next
succeeding Business Day with respect to
such Floating Rate Book-Entry Note,
except that in the case of a Floating
Rate Book-Entry Note for which the Base
Rate is LIBOR, if such Business Day is
10
in the next succeeding calendar month,
such Interest Payment Date will be the
immediately preceding Business Day; and
provided further, that in the case of a
Floating Rate Book-Entry Note issued
between a Regular Record Date and an
Interest Payment Date, the first
interest payment will be made on the
Interest Payment Date following the next
succeeding Regular Record Date.
Notice of Interest Payment and Regular
Record Dates. On the first Business Day
of January, April, July and October of
each year, the Trustee will deliver to
the Company and DTC a written list of
Regular Record Dates and Interest
Payment Dates that will occur with
respect to Book-Entry Notes during the
six-month period beginning on such first
Business Day. Promptly after each
Interest Determination Date for Floating
Rate Book-Entry Notes, the Trustee, as
Calculation Agent, will notify Standard
& Poor's Corporation of the interest
rates determined on such Interest
Determination Date.
Calculation of Interest: Fixed Rate Book-Entry Notes. Interest on
Fixed Rate Book-Entry Notes (including
interest for partial periods) will be
calculated on the basis of a 360-day
year of twelve 30-day months.
Floating Rate Book-Entry Notes. Interest
rates on Floating Rate Book-Entry Notes
will be determined as set forth in the
form of Notes. Interest on Floating Rate
Book-Entry Notes, except as otherwise
set forth therein, will be calculated on
the basis of actual days elapsed and a
year of 360 days, except that in the
11
case of a Floating Rate Book-Entry Note
for which the Base Rate is the Treasury
Rate or the CMT Rate, interest will be
calculated on the basis of the actual
number of days in the year.
Payments of Principal
and Interest: Payment of Interest Only. Promptly after
each Regular Record Date, the Trustee
will deliver to the Company and DTC a
written notice setting forth, by CUSIP
number, the amount of interest to be
paid on each Global Security on the
following Interest Payment Date (other
than an Interest Payment Date coinciding
with Maturity) and the total of such
amounts. DTC will confirm the amount
payable on each Global Security on such
Interest Payment Date by reference to
the appropriate (daily or weekly) bond
reports published by Standard & Poor's
Corporation. The Company will pay to the
Trustee, as paying agent, the total
amount of interest due on such Interest
Payment Date (other than at Maturity),
and the Trustee will pay such amount to
DTC, at the times and in the manner set
forth below under "Manner of Payment."
Payments at Maturity. On or about the
first Business Day of each month, the
Trustee will deliver to the Company and
DTC a written list of principal and
interest to be paid on each Global
Security maturing (on a Maturity or
Redemption Date or otherwise) in the
following month. The Trustee, the
Company and DTC will confirm the amounts
of such principal and interest payments
with respect to each such Global
Security on or about the fifth Business
Day preceding the Maturity of such
Global Security. On or before Maturity,
12
the Company will pay to the Trustee, as
paying agent, the principal amount of
such Global Security, together with
interest due at such Maturity. The
Trustee will pay such amount to DTC at
the times and in the manner set forth
below under "Manner of Payment." If any
Maturity of a Global Security
representing Book-Entry Notes is not a
Business Day, the payment due on such
day shall be made on the next succeeding
Business Day and no interest shall
accrue on such payment for the period
from and after such Maturity. Promptly
after payment to DTC of the principal
and interest due at Maturity of such
Global Security, the Trustee will cancel
such Global Security in accordance with
the Indenture and so advise the Company.
On the first Business Day of each month,
the Trustee will deliver to the Company
a written statement indicating the total
principal amount of Outstanding Global
Securities as of the immediately
preceding Business Day. If the Maturity
of a Book-Entry Note is not a Business
Day, the payment due on such day shall
be made on the next succeeding Business
Day and no interest shall accrue on such
payment for the period from and after
such Maturity.
Manner of Payment. The total amount of
any principal and interest due on Global
Securities on any Interest Payment Date
or at Maturity shall be paid by the
Company to the Trustee in immediately
available funds no later than 9:30 A.M.
(New York City time) on such date. The
Company will make such payment on such
Global Securities by instructing the
Trustee to withdraw funds from an
account maintained by the Company with
13
the Trustee or by wire transfer to the
Trustee. The Company will confirm any
such instructions in writing to the
Trustee. Prior to 10 A.M. (New York City
time) on the date of Maturity or as soon
as possible thereafter, the Trustee will
pay by separate wire transfer (using
Fedwire message entry instructions in a
form previously specified by DTC) to an
account at the Federal Reserve Bank of
New York previously specified by DTC, in
funds available for immediate use by
DTC, each payment of principal (together
with interest thereon) due on a Global
Security on such date. On each Interest
Payment Date (other than at Maturity),
interest payments shall be made to DTC,
in funds available for immediate use by
DTC, in accordance with existing
arrangements between the Trustee and
DTC. On each such date, DTC will pay, in
accordance with its SDFS operating
procedures then in effect, such amounts
in funds available for immediate use to
the respective Participants in whose
names the Book-Entry Notes represented
by such Global Securities are recorded
in the book-entry system maintained by
DTC. None of the Company (as issuer or
as paying agent) or the Trustee shall
have any direct responsibility or
liability for the payment by DTC to such
Participants of the principal of and
interest on the Book-Entry Notes.
Withholding Taxes. The amount of any
taxes required under applicable law to
be withheld from any interest payment on
a Book-Entry Note will be determined and
withheld by the Participant, indirect
participant in DTC or other Person
14
responsible for forwarding payments and
materials directly to the beneficial
owner of such Note.
Procedures upon Company Notice to Trustee Regarding
Company's Exercise Exercise of Optional Reset. Not
of Optional Reset less than 45 or more than 60 days
or Optional before an Optional Reset Date as
Extension of Maturity: set forth in a Book-Entry Note, the
Company will notify the Trustee whether
it is exercising its option to reset the
Interest Rate or Spread or Spread
Multiplier, as the case may be, for such
Book-Entry Note, and if so, (i) the new
Interest Rate or Spread or Spread
Multiplier, as the case may be, for such
Book-Entry Note during the period from
such Optional Reset Date to the next
Optional Reset Date as set forth in such
Book-Entry Note or, if there is no such
next Optional Reset Date, to the Stated
Maturity of such Book-Entry Note (the
"Subsequent Interest Period"); and (ii)
the provisions, if any, for redemption
of such Book-Entry Note during such
Subsequent Interest Period, including
the date or dates on which or the period
or periods during which such redemption
may occur during such Subsequent
Interest Period.
Company Notice to Trustee Regarding
Exercise of Optional Extension of
Maturity. If the Company elects to
exercise an option, as set forth in a
Book-Entry Note, to extend the Stated
Maturity of such Note, it will so notify
the Trustee no less than 45 or more than
60 days before the Stated Maturity of
such Book-Entry Note, and will further
indicate (i) the new Stated Maturity;
(ii) the Interest Rate or Spread or
Spread Multiplier, as the case may be,
and (iii) the provisions, if any, for
15
redemption of such Book-Entry Note
during such extension period, including
the date or dates on which or the period
or periods during which such redemption
may occur during such extension period.
Trustee Notice to DTC Regarding
Company's Exercise of Optional Extension
or Reset. Upon receipt of notice from
the Company regarding the Company's
exercise of either an optional extension
of maturity or an optional reset, the
Trustee will hand-deliver a notice to
DTC not less than 40 days before the
Optional Reset Date (in which case a
"Reset Notice") or the Stated Maturity
(in which case an "Extension Notice"),
as the case may be, which Reset Notice
or Extension Notice shall identify such
Book-Entry Note by CUSIP number and
shall contain the information required
by the terms of the Book-Entry Note.
Trustee Notice to Company Regarding
Option To Be Repaid. If, after receipt
of either a Reset Notice or an Extension
Notice, DTC exercises the option for
repayment by tendering the Global
Security representing the Book-Entry
Note to be repaid as set forth in such
Note, the Trustee shall give notice to
the Company not less than 22 days before
the Optional Reset Date or the old
Stated Maturity, as the case may be, of
the principal amount of Book-Entry Notes
to be repaid on such Optional Reset Date
or old Stated Maturity, as the case may
be.
Company Notice Regarding New Interest
Rate or New Spread or Spread Multiplier.
If the Company elects to revoke the
Interest Rate or Spread or Spread
16
Multiplier and establish a higher
interest rate or Spread or Spread
Multiplier for an Optional Reset Period
or extension period, as the case may be,
it shall, not less than 20 days before
such Optional Reset Date or old Stated
Maturity, so notify the Trustee. The
Trustee will immediately thereafter
notify DTC of the new Interest Rate or
Spread or Spread Multiplier applicable
to such Book-Entry Note.
Trustee Notice to Company Regarding DTC
Revocation of Option To Be Repaid. If,
after DTC has tendered any Book-Entry
Notes for repayment pursuant to an
Extension Notice or an Optional Reset
Notice, DTC then revokes such tender for
repayment, the Trustee shall give notice
to the Company not less than five days
prior to the Stated Maturity or Optional
Reset Date, as the case may be, of such
revocation and of the principal amount
of Book-Entry Notes for which tender for
repayment has been revoked.
Deposit of Repayment Price. On or before
any old Stated Maturity where the
Maturity has been extended, and on or
before an Optional Reset Date, the
Company shall deposit with the Trustee
an amount of money sufficient to pay the
principal amount, plus interest accrued
to such old Stated Maturity or Optional
Reset Date, as the case may be, for all
the Book-Entry Notes or portions thereof
which are to be repaid on such old
Stated Maturity or Optional Reset Date,
as the case may be. The Trustee will use
such money to repay such Book-Entry
Notes pursuant to the terms set forth in
such Notes.
17
Procedures upon Company Notice to Trustee Regarding
Company's Exercise Exercise of Optional Redemption.
of Optional Redemption: At least 45 days prior to the date
on which it intends to redeem a
Book-Entry Note, the Company will notify
the Trustee that it is exercising such
option with respect to such Book-Entry
Note on such date.
Trustee Notice to DTC Regarding
Company's Exercise of Optional
Redemption. After receipt of notice that
the Company is exercising its option to
redeem a Book-Entry Note, the Trustee
will, at least 30 days before the
redemption date for such Book-Entry
Note, hand deliver to DTC a notice
identifying such Book-Entry Note by
CUSIP number and informing DTC of the
Company's exercise of such option with
respect to such Book-Entry Note.
Deposit of Redemption Price. On or
before any redemption date, the Company
shall deposit with such Trustee an
amount of money sufficient to pay the
redemption price, plus interest accrued
to such redemption date, for all the
Book-Entry Notes or portions thereof
which are to be repaid on such
redemption date. Such Trustee will use
such money to repay such Book-Entry
Notes pursuant to the terms set forth in
such Notes.
Payments of Princi- Trustee Notice to Company of Op-
pal and Interest tion To Be Repaid. Upon receipt of
upon Exercise of notice of exercise of the option
Optional Repayment for repayment and the Global Secu-
(Except Pursuant to rities representing the Book-Entry
Company's Exercise Notes so to be repaid as set forth of
such Notes, the Trustee shall Optional Reset or in (unless such notice
Optional Extension): was received pursuant to the Company's
exercise of an optional reset or an
optional extension of maturity, in each
18
of which cases the relevant procedures
set forth above are to be followed) give
notice to the Company not less than 20
days prior to each Optional Repayment
Date of such Optional Repayment Date and
of the principal amount of Book-Entry
Notes to be repaid on such Optional
Repayment Date.
Deposit of Repayment Price. On or prior
to any Optional Repayment Date, the
Company shall deposit with such Trustee
an amount of money sufficient to pay the
optional repayment price, and accrued
interest thereon to such date, of all
the Book-Entry Notes or portions thereof
which are to be repaid on such date.
Such Trustee will use such money to
repay such Book-Entry Notes pursuant to
the terms set forth in such Notes.
Procedure for Rate
Setting and Posting: The Company and the Agents will discuss
from time to time the aggregate
principal amount of, the issuance price
of, and the interest rates to be borne
by, Book-Entry Notes that may be sold as
a result of the solicitation of orders
by the Agents. If the Company decides to
set prices of, and rates borne by, any
Book-Entry Notes in respect of which the
Agents are to solicit orders (the
setting of such prices and rates to be
referred to herein as "posting") or if
the Company decides to change prices or
rates previously posted by it, it will
promptly advise the Agents of the prices
and rates to be posted.
Acceptance and
Rejection of Orders: Unless otherwise instructed by the
Company, each Agent will advise the
Company promptly by telephone of all
orders to purchase Book-Entry Notes
received by such Agent, other than those
19
rejected by the Agent in whole or in
part in the reasonable exercise of its
discretion. Unless otherwise agreed by
the Company and the Agents, the Company
has the right to accept orders to
purchase Book-Entry Notes and may reject
any such orders in whole or in part.
Preparation of
Pricing Supplement: If any order to purchase a Book- Entry
Note is accepted by or on behalf of the
Company, the Company will prepare a
pricing supplement (a "Pricing
Supplement") reflecting the applicable
interest rates and other terms of such
Book-Entry Note and will arrange to have
the Pricing Supplement filed with the
Commission via the Commission's XXXXX
system in accordance with the applicable
paragraph of Rule 424(b) under the Act
and will supply at least ten copies
thereof (and additional copies if
requested) to the Agent which presented
the order (the "Presenting Agent") at
(unless otherwise specified by the
Presenting Agent in writing) the
following address:
If to Salomon Brothers Inc:
Salomon Brothers Inc
0000 Xxxxxx Xxxxx Xxxxxxx
Xxxxx, Xxxxxxx 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
or
If to Xxxxxxx Lynch, Xxxxxx,
Xxxxxx & Xxxxx Incorporated:
Xxxxxxx Xxxxx & Co. - Tritech
Services
0 Xxxxxxxxx Xxxxx
Corporate Park 000
Xxxxxxxxxx, Xxx Xxxxxx 00000
20
Attention: Final Prospectus Unit/
Xxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000/26/27
Telecopy: (000) 000-0000
also, for record keeping purposes,
please send a copy to:
Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated
Xxxxxxx Xxxxx World Headquarters
World Financial Center, North Tower
10th Floor
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-1310
Attention: MTN Product Management
or, if to another Presenting Agent,
to the address specified by it to
the Company.
The Presenting Agent will cause a
Prospectus and Pricing Supplement to be
delivered to the purchaser of such
Book-Entry Note.
In each instance that a Pricing
Supplement is prepared, the Presenting
Agent will affix the Pricing Supplement
to Prospectuses prior to their use.
Outdated Pricing Supplements (other than
those retained for files) will be
destroyed.
Suspension of Solici- The Company reserves the right, in
tation; Amendment or its sole discretion, to instruct
Supplement: the Agents to suspend at any time, for
any period of time or permanently, the
solicitation of orders to purchase
Book-Entry Notes. Upon receipt of such
instructions, the Agents will forthwith
21
suspend solicitation until such time as
the Company has advised them that such
solicitation may be resumed.
In the event that at the time the
Company suspends solicitation of
purchases there shall be any orders
outstanding for settlement, the Company
will promptly advise the 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, together with the
appropriate Pricing Supplement, may be
delivered in connection with the
settlement of such orders. The Company
will have the sole responsibility for
such decision and for any arrangements
that may be made in the event that the
Company determines that such orders may
not be settled or that copies of such
Prospectus may not be so delivered.
If the Company decides to amend or
supplement the Registration Statement
(as defined in the Agency Agreement) or
the Prospectus, it will promptly advise
the Agents and furnish the Agents 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 Agency Agreement. Subject to the
provisions of the Agency Agreement, the
Company may file with the Commission any
such 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 pursuant to the applicable
paragraph of Rule 424(b).
22
Procedures For Rate When the Company has determined
Changes: to change the interest rates of
Book-Entry Notes being offered, it will
promptly advise the Agents and the
Agents will forthwith suspend
solicitation of orders. The Agents will
telephone the Company with
recommendations as to the changed
interest rates. At such time as the
Company has advised the Agents of the
new interest rates, the Agents may
resume solicitation of orders. Until
such time only "indications of interest"
may be recorded.
Delivery of Prospectus: A copy of the Prospectus and a Pricing
Supplement relating to a Book-Entry Note
must accompany or precede the earliest
of any written offer of such Book-Entry
Note, confirmation of the purchase of
such Book-Entry Note and payment for
such Book-Entry Note by its purchaser.
If notice of a change in the terms of
the Book-Entry Notes is received by the
Agents between the time an order for a
Book-Entry Note is placed and the time
written confirmation thereof is sent by
the Presenting Agent to a customer or
his agent, such confirmation shall be
accompanied by a Prospectus and Pricing
Supplement setting forth the terms in
effect when the order was placed.
Subject to "Suspension of Solicitation;
Amendment or Supplement" above, the
Presenting Agent will deliver a
Prospectus and Pricing Supplement as
herein described with respect to each
Book-Entry Note sold by it. The Company
will make such delivery if such
Book-Entry Note is sold directly by the
Company to a purchaser (other than an
Agent).
23
Confirmation: For each order to purchase a Book-Entry
Note solicited by any Agent and accepted
by or on behalf of the Company, the
Presenting Agent will issue a
confirmation to the purchaser, with a
copy to the Company, setting forth the
details set forth above and delivery and
payment instructions.
Settlement: The receipt by the Company of
immediately available funds in payment
for a Book-Entry Note and the
authentication and issuance of the
Global Security representing such
Book-Entry Note shall constitute
"settlement" with respect to such
Book-Entry Note. All orders accepted by
the Company will be settled on the third
Business Day following the date of sale
of such Book-Entry Note pursuant to the
timetable for settlement set forth below
unless the Company and the purchaser
agree to settlement on another day which
shall be no earlier than the next
Business Day following the date of sale.
Settlement Procedures: Settlement Procedures with regard to
each Book-Entry Note sold by the Company
through any Agent, as agent, shall be as
follows:
A. The Presenting Agent will advise the
Company by telephone of the following
settlement information:
1. Principal or face amount.
2. Stated Maturity.
3. In the case of a Fixed Rate
Book-Entry Note, the interest rate or,
in the case of a Floating Rate
Book-Entry Note, the Interest Rate
Basis, initial interest rate (if known
24
at such time), Index Maturity, Interest
Reset Period, Interest Reset Dates,
Spread or Spread Multiplier (if any),
Minimum Interest Rate (if any) and
Maximum Interest Rate (if any).
4. Interest Payment Dates and the
Interest Payment Period.
5. Redemption, repayment and extension
provisions, if any.
6. Settlement date.
7. Price.
8. Presenting Agent's commission,
determined as provided in Section 2 of
the Agency Agreement.
9. Whether such Book-Entry Note is
issued at an original issue discount
("OID") and, if so, the total amount of
OID, the yield to maturity and the
initial accrual period OID.
B. The Company will assign a CUSIP
number to the Global Security
representing such Book-Entry Note and
then advise the Trustee by telephone
(confirmed in writing at any time on the
same date) or electronic transmission of
the information set forth in Settlement
Procedure "A" above, such CUSIP number
and the name of the Presenting Agent.
The Company will also notify the
Presenting Agent by telephone of such
CUSIP number as soon as practicable.
25
Each such communication by the Company
shall constitute a representation and
warranty by the Company to the Trustee
and the Presenting Agent that (i) such
Note is then, and at the time of
issuance and sale thereof will be, duly
authorized for issuance and sale by the
Company, (ii) such Note, and the Global
Security representing such Note, will
conform with the terms of the Indenture
for such Note, and (iii) upon
authentication and delivery of such
Global Security, the aggregate initial
offering price of all Notes issued under
the Indenture will not exceed
$200,000,000 (except for Book-Entry
Notes represented by Global Securities
authenticated and delivered in exchange
for or in lieu of Global Securities
pursuant to the Indenture and except for
Certificated Notes authenticated and
delivered upon registration of transfer
of, in exchange for, or in lieu of
Certificated Notes pursuant to any such
Section).
C. The Trustee will enter a pending
deposit message through DTC's
Participant Terminal System providing
the following settlement information to
DTC (which shall route such information
to Standard & Poor's Corporation), the
Presenting Agent and, upon request, the
Trustee:
1. The information set forth in
Settlement Procedure "A".
26
2. Identification as a Fixed Rate
Book-Entry Note or a Floating Rate
Book-Entry Note.
3. Initial Interest Payment Date for
such Book-Entry Note, number of days by
which such date succeeds the related
Regular Record Date and amount of
interest payable on such Interest
Payment Date.
4. The Interest Payment Period.
5. CUSIP number of the Global Security
representing such Book-Entry Note.
6. Whether such Global Security will
represent any other Book-Entry Note (to
the extent known at such time).
D. To the extent the Company has not
already done so, the Company will
deliver to the Trustee a Global Security
in a form that has been approved by the
Company, the Agents and the Trustee.
E. The Trustee will complete such
Book-Entry Note, stamp the appropriate
legend, as instructed by DTC, if not
already set forth thereon, and
authenticate the Global Security
representing such Book-Entry Note.
F. DTC will credit such Book-Entry Note
to the Trustee's participant account at
DTC.
27
G. The Trustee will enter a SDFS
delivery order through DTC's Participant
Terminal System instructing DTC to (i)
debit such Book-Entry Note to the
Trustee's participant account and credit
such Book-Entry Note to the Presenting
Agent's participant account and (ii)
debit the Presenting Agent's settlement
account and credit the Trustee's
settlement account for an amount equal
to the price of such Book-Entry Note
less the Presenting Agent's commission.
The entry of such a delivery order shall
constitute a representation and warranty
by the Trustee to DTC that (i) the
Global Security representing such
Book-Entry Note has been issued and
authenticated and (ii) the Trustee is
holding such Global Security pursuant to
the Medium-Term Note Certificate
Agreement between the Trustee and DTC.
H. The Presenting Agent will enter an
SDFS delivery order through DTC's
Participant Terminal System instructing
DTC (i) to debit such Book-Entry Note to
the Presenting Agent's participant
account and credit such Book-Entry Note
to the participant accounts of the
Participants with respect to such
Book-Entry Note and (ii) to debit the
settlement accounts of such Participants
and credit the settlement account of the
Presenting Agent for an amount equal to
the price of such Book-Entry Note.
I. Transfers of funds in accordance with
SDFS delivery orders described in
Settlement Procedures "G" and "H" will
28
be settled in accordance with SDFS
operating procedures in effect on the
settlement date.
X. The Trustee will, upon receipt of
funds from the Presenting Agent in
accordance with Settlement Procedure
"G", wire transfer to the account of the
Company maintained at Citibank, N.A.,
000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx,
funds available for immediate use in the
amount transferred to the Trustee in
accordance with Settlement Procedure
"G".
K. The Presenting Agent will confirm the
purchase of such Book-Entry Note to the
purchaser either by transmitting to the
Participants with respect to such
Book-Entry Note a confirmation order or
orders through DTC's institutional
delivery system or by mailing a written
confirmation to such purchaser.
Settlement Procedures For orders of Book-Entry Notes
Timetable: solicited by any Agent and accepted by
the Company for settlement on the first
Business Day after the sale date,
Settlement Procedures "A" through "K"
set forth above shall be completed as
soon as possible but not later than the
respective times (New York City time)
set forth below:
Settlement
Procedure Time
A 11:00 A.M. on the sale
date
B 12:00 Noon on the sale
date
29
C 2:00 P.M. on the sale
date
D 3.00 P.M. on the day
before settlement
E 9:00 A.M. on settlement
date
F 10:00 A.M. on
settlement date
G-H 2:00 P.M. on settlement
date
4:45 P.M. on settlement
date
J-K 5:00 P.M. on settlement
date
If a sale is to be settled more than one
Business Day after the sale date,
Settlement Procedures "A", "B" and "C"
shall be completed as soon as
practicable but no later than 11:00 A.M.
and 12:00 Noon on the first Business Day
after the sale date and no later than
2:00 P.M. on the Business Day before the
settlement date, respectively. If the
initial interest rate for a Floating
Rate Book-Entry Note has not been
determined at the time that Settlement
Procedure "A" is completed, Settlement
Procedures "B" and "C" shall be
completed as soon as such rate has been
determined but no later than 12:00 Noon
and 2:00 P.M., respectively, on the
Business Day before the settlement date.
Settlement Procedure "I" is subject to
extension in accordance with any
extension of Fedwire closing deadlines
and in the other events specified in
SDFS operating procedures in effect on
the settlement date.
If settlement of a Book-Entry Note is
rescheduled or cancelled, the Trustee
will deliver to DTC, through DTC's
Participant Terminal System, a
30
cancellation message to such effect by
no later than 2:00 P.M. on the Business
Day immediately preceding the scheduled
settlement date.
Failure To Settle: If the Trustee fails to enter an SDFS
delivery order with respect to a
Book-Entry 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 Book-Entry Note to the
Trustee's participant account. DTC will
process the withdrawal message, provided
that the Trustee's participant account
contains a principal amount of the
Global Security representing such
Book-Entry Note that is at least equal
to the principal amount to be debited.
If a withdrawal message is processed
with respect to all the Book-Entry Notes
represented by a Global Security, the
Trustee will cancel such Global Security
in accordance with the Indenture and so
advise the Company and the Trustee will
make appropriate entries in its records.
The CUSIP number assigned to such Global
Security shall, in accordance with CUSIP
Service Bureau procedures, be cancelled
and not immediately reassigned. If a
withdrawal message is processed with
respect to one or more, but not all, of
the Book-Entry Notes represented by a
Global Security, the Trustee will
exchange such Book-Entry Note for two
Global Securities, one of which shall
represent such BookEntry Notes and shall
be cancelled immediately after issuance
and the other of which shall represent
the other Book-Entry Notes previously
31
represented by the surrendered Global
Security and shall bear the CUSIP number
of the surrendered Global Security.
If the purchase price for any Book-Entry
Note is not timely paid to the
Participants with respect to such Note
by the beneficial purchaser thereof (or
a Person, including an indirect
participant in DTC, acting on behalf of
such purchaser), such Participants and,
in turn, the Presenting Agent may enter
SDFS delivery orders through DTC's
Participant Terminal System reversing
the orders entered pursuant to
Settlement Procedures "H" and "G",
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 a default by the Presenting Agent
in the performance of its obligations
hereunder and under the Agency
Agreement, then the Company will
reimburse the Presenting Agent or the
Trustee, as applicable, on an equitable
basis for the loss of the use of the
funds during the period when they were
credited to the account of the Company.
Notwithstanding the foregoing, upon any
failure to settle with respect to a
Book-Entry Note, DTC may take any
actions in accordance with its SDFS
operating procedures then in effect. In
the event of a failure to settle with
respect to one or more, but not all, of
the Book-Entry Notes to have been
represented by a Global Security, the
Trustee will provide, in accordance with
Settlement Procedure "E", for the
authentication and issuance of a Global
32
Security representing the other
Book-Entry Notes to have been
represented by such Global Security and
will make appropriate entries in its
records.
Trustee Not to Risk Nothing herein shall be deemed to
Funds: require the Trustee to risk or expend
its own funds in connection with any
payment to the Company, DTC, the Agents
or the purchaser, it being understood by
all parties that payments made by the
Trustee to the Company, DTC, the Agents
or the purchaser shall be made only to
the extent that funds are provided to
the Trustee for such purpose.
Authenticity of The Company will cause
the Trustee Signatures: to furnish the
Agents from time to time with the
specimen signatures of each of the
Trustee's officers, employees or agents
who has been authorized by the Trustee
to authenticate Book-Entry Notes, but no
Agent will have any obligation or
liability to the Company or the Trustee
in respect of the authenticity of the
signature of any officer, employee or
agent of the Company or the Trustee on
any Book-Entry Note.
Payment of Expenses: Each Agent shall forward to the Company,
on a monthly basis, a statement of the
out-of-pocket expenses incurred by such
Agent during that month that are
reimbursable to it pursuant to the terms
of the Agency Agreement. The Company
will remit payment to the Agents
currently on a monthly basis.
Advertising Costs: The Company will determine with the
Agents the amount of advertising that
may be appropriate in soliciting offers
to purchase the Book-Entry Notes.
Advertising expenses will be paid by the
Company.
33
Periodic Statements Periodically, the Trustee will send
from the Trustee: to the Company a statement setting forth
the principal amount of Book-Entry Notes
Outstanding as of that date and setting
forth a brief description of any sales
of Book-Entry Notes which the Company
has advised the Trustee but which have
not yet been settled.
34
PART II Administrative Procedures for
Certificated Notes
The Trustee will serve as registrar and transfer agent in connection with
the Certificated Notes.
Issuance: Each Certificated Note will be dated and
issued as of the date of its
authentication by the Trustee. Each
Certificated Note will bear an Original
Issue Date, which will be (i) with
respect to an original Certificated Note
(or any portion thereof), its original
issuance date (which will be the
settlement date) and (ii) with respect
to any Certificated Note (or portion
thereof) issued subsequently upon
transfer or exchange of a Certificated
Note or in lieu of a destroyed, lost or
stolen Certificated Note, the Original
Issue Date of the predecessor
Certificated Note, regardless of the
date of authentication of such
subsequently issued Certificated Note.
Registration: Certificated Notes will be issued only
in fully registered form without
coupons.
Transfers and A Certificated Note may be presented for
Exchanges: transfer or exchange at the principal
corporate trust office in the City of
New York of the Trustee. Certificated
Notes will be exchangeable for other
Certificated Notes having identical
terms but different authorized
denominations without service charge.
Certificated Notes will not be
exchangeable for Book-Entry Notes.
Maturities: Each Certificated Note will mature on a
date more than nine months after the
Original Issue Date (as defined below)
for such Note. A Floating Rate
Certificated Note will mature only on an
35
Interest Payment Date for such Note. Any
Note denominated in Pounds Sterling will
mature on a date not less than one year,
nor more than five years, after its
Original Issue Date.
Denominations: The denomination of any Certificated
Note denominated in U.S. dollars will be
a minimum of $1,000 or any amount in
excess thereof that is an integral
multiple of $1,000. The authorized
denominations of Certificated Notes
denominated in any other currency will
be specified pursuant to "Settlement
Procedures" below.
Interest: General. Interest, if any, on each
Certificated Note will accrue from the
original issue date for the first
interest period or the last date to
which interest has been paid, if any,
for each subsequent interest period, and
will be calculated and paid in the
manner described in such Note and in the
Prospectus, as supplemented by the
applicable Pricing Supplement. Unless
otherwise specified therein, each
payment of interest on a Certificated
Note will include interest accrued to
but excluding the Interest Payment Date
(provided that, in the case of
Certificated Notes which reset daily or
weekly, interest payments will include
accrued interest to but excluding the
Regular Record Date immediately
preceding the Interest Payment Date) or
to but excluding Maturity (other than a
Maturity of a Fixed Rate Certificated
Note occurring on the 31st day of a
month, in which case such payment of
interest will include interest accrued
to but excluding the 30th day of such
month).
36
Regular Record Dates. The Regular Record
Dates with respect to any Interest
Payment Date shall be the date (whether
or not a Business Day) fifteen calendar
days immediately preceding such Interest
Payment Date.
Fixed Rate Certificated Notes. Unless
otherwise specified pursuant to
Settlement Procedure "A" below, interest
payments on Fixed Rate Certificated
Notes will be made semiannually on May
15 and November 15 of each year and at
Maturity; provided, however, that if any
Interest Payment Date for a Fixed Rate
Certificated Note is not a Business Day,
the payment due on such day shall be
made on the next succeeding Business Day
and no interest shall accrue on such
payment for the period from and after
such Interest Payment Date; provided
further, that in the case of a Fixed
Rate Certificated Note issued between a
Regular Record Date and an Interest
Payment Date, the first interest payment
will be made on the Interest Payment
Date following the next succeeding
Regular Record Date.
Floating Rate Certificated Notes.
Interest payments will be made on
Floating Rate Certificated Notes
monthly, quarterly, semi-annually or
annually. Interest will be payable, in
the case of Floating Rate Certificated
Notes with a monthly Interest Payment
Period, on the third Wednesday of each
month; with a quarterly interest Payment
Period, on the third Wednesday of March,
June, September and December of each
year; with a semi-annual Interest
37
Payment Period, on the third Wednesday
of the two months specified pursuant to
Settlement Procedure "A" below; and with
an annual Interest Payment Period, on
the third Wednesday of the month
specified pursuant to Settlement
Procedure "A" below; provided, however,
that if an Interest Payment Date for a
Floating Rate Certificated Note would
otherwise be a day that is not a
Business Day with respect to such
Floating Rate Certificated Note, such
Interest Payment Date will be the next
succeeding Business Day with respect to
such Floating Rate Certificated Note,
except in the case of a Floating Rate
Certificated Note for which the Base
Rate is LIBOR, if such Business Day is
in the next succeeding calendar month,
such Interest Payment Date will be the
immediately preceding Business Day; and
provided further, that in the case of a
Floating Rate Certificated Note issued
between a Regular Record Date and an
interest Payment Date, the first
interest payment will be made on the
Interest Payment Date following the next
succeeding Regular Record Date.
Calculation of Fixed Rate Certificated Note.
Interest: Interest on Fixed Rate Certificated
Notes (including interest for partial
periods) will be calculated on the basis
of a 360-day year of twelve 30-day
months.
Floating Rate Certificated Notes.
Interest rates on Floating Rate
Certificated Notes will be determined as
set forth in the form of Notes. Interest
on Floating Rate Certificated Notes,
except as otherwise set forth therein,
will be calculated on the basis of
actual days elapsed and a year of 360
days, except that in the case of a
Floating Rate Certificated Note for
38
which the Base Rate is the Treasury Rate
or the CMT Rate, interest will be
calculated on the basis of the actual
number of days in the year.
Payments of Principal Interest, if any, on each Certifi-
and Interest: cated Note will be calculated and paid
in the manner described in such Note and
in the Prospectus, as supplemented by
the applicable Pricing Supplement.
Unless otherwise provided in the
Indenture or the Certificated Note, the
first payment of interest on any
Certificated Note originally issued
between a Record Date and an Interest
Payment Date will be made on the next
succeeding Interest Payment Date.
Interest payable at the Maturity of a
Certificated Note will be payable to the
Person to whom the principal of such
Note is payable. Unless other
arrangements are made, all interest
payments (excluding interest payments
made on the Maturity Date) will be made
by check mailed to the person entitled
thereto as provided above; provided,
however, that the holder of $10,000,000
(or the equivalent thereof in other
currencies) or more of Certificated
Notes with similar tenor and terms will
be entitled to receive payment by wire
transfer in U.S. dollars.
Within 10 days following each Record
Date, the Trustee will inform the
Company of the total amount of the
interest payments to be made by the
Company on the next succeeding Interest
Payment Date. The Trustee will provide
monthly to the Company a list of the
principal and interest to be paid on
Certificated Notes maturing in the next
succeeding month.
39
The Trustee will be responsible for
withholding taxes on interest paid on
Certificated Notes as required by
applicable law.
If the Maturity of a Certificated Note
is not a Business Day, the payment due
on such day shall be made on the next
succeeding Business Day and no interest
shall accrue on such payment for the
period from and after such Maturity.
Procedures upon Company Notice to Trustee Regarding
Company's Exercise Exercise of Optional Reset. Not
of Optional Reset less than 45 or more than 60 days
or Optional before an Optional Reset Date as
Extension of set forth in a Certificated Note,
Maturity: the Company will notify the
Trustee whether it is exercising its
option to reset the Interest Rate or
Spread or Spread Multiplier, as the case
may be, for such Certificated Note, and
if so, (i) the new Interest Rate or
Spread or Spread Multiplier, as the case
may be, for such Certificated Note
during the period from such Optional
Reset Date to the next Optional Reset
Date as set forth in such Certificated
Note or, if there is no such next
Optional Reset Date, to the Stated
Maturity of such Certificated Note (the
"Subsequent Interest Period"); and (ii)
the provisions, if any, for redemption
of such Certificated Note during such
Subsequent Interest Period, including
the date or dates on which or the period
or periods during which such redemption
may occur during such Subsequent
Interest Period.
Company Notice to Trustee Regarding
Exercise of Optional Extension of
Maturity. If the Company elects to
exercise an option, as set forth in a
40
Certificated Note, to extend the Stated
Maturity of such Note, it will so notify
the Trustee no less than 45 or more than
60 days before the Stated Maturity of
such Certificated Note, and will further
indicate (i) the new Stated Maturity;
(ii) the Interest Rate or Spread or
Spread Multiplier, as the case may be;
and (iii) the provisions, if any, for
redemption of such Certificated Note
during such extension period, including
the date or dates on which or the period
or periods during which such redemption
may occur during such extension period.
Trustee Notice to Holders Regarding
Company's Exercise of Optional Extension
or Reset. Upon receipt of notice from
the Company regarding the Company's
exercise of either an Optional extension
of maturity or an optional reset, the
Trustee will mail a notice, first class,
postage prepaid, to the Holder not less
than 40 days before the Optional Reset
Date (in which case a "Reset Notice") or
the Stated Maturity (in which case an
"Extension Notice"), as the case may be,
which Reset Notice or Extension Notice
shall contain the information required
by the terms of the Certificated Note.
Trustee Notice to Company Regarding
Option To Be Repaid. If, after receipt
of either a Reset Notice or an Extension
Notice, any Holder of a Certificated
Note exercises the option for repayment
by tendering the Certificated Note to be
repaid as set forth in the Certificated
Note, the Trustee shall give notice to
the Company not less than 22 days before
the Optional Reset Date or the old
Stated Maturity, as the case may be, of
the principal amount of Certificated
41
Notes to be repaid on such Optional
Reset Date or old Stated Maturity, as
the case may be.
Company Notice Regarding New Interest
Rate or New Spread or Spread Multiplier.
If the Company elects to revoke the
Interest Rate or Spread or Spread
Multiplier and establish a higher
interest rate or Spread or Spread
Multiplier for an optional Reset Period
or extension period, as the case may be,
it shall, not less than 20 days before
such Optional Reset Date or old Stated
Maturity, so notify the Trustee. The
Trustee will immediately thereafter
notify the Holder of such Certificated
Note, by first class mail, postage
prepaid of the new Interest Rate or
Spread or Spread Multiplier applicable
to such Certificated Note.
Trustee Notice to Company Regarding
Holders Revocation of Option To Be
Repaid. If, after the Holder has
tendered any Certificated Notes for
repayment pursuant to an Extension
Notice or an Optional Reset Notice, such
Holder then revokes such tender for
repayment, the Trustee shall give notice
to the Company not less than five days
prior to the Stated Maturity or Optional
Reset Date, as the case may be, of such
revocation and of the principal amount
of Certificated Notes for which tender
for repayment has been revoked.
Deposit of Repayment Price. On or before
any old Stated Maturity where the
Maturity has been extended, and on or
before an Optional Reset Date, the
Company shall deposit with the Trustee
an amount of money sufficient to pay the
42
principal amount, plus interest accrued
to such old Stated Maturity or Optional
Reset Date, as the case may be, for all
the Certificated Notes or portions
thereof which are to be repaid on such
old Stated Maturity or Optional Reset
Date, as the case may be. Such Trustee
will use such money to repay such
Certificated Notes pursuant to the terms
set forth in such Notes.
Procedures upon Company Notice to Trustee Regarding
Company's Exercise Exercise of Optional Redemption.
of Optional Redemption: At least 45 days prior to the date
on which it intends to redeem a
Certificated Note, the Company will
notify the Trustee that it is exercising
such option with respect to such
Certificated Note on such date.
Trustee Notice to Holders Regarding
Company's Exercise of Optional
Redemption. After receipt of notice that
the Company is exercising its option to
redeem a Certificated Note, the Trustee
will, at least 30 days before the
redemption date for such Certificated
Note, mail a notice, first class,
postage prepaid, to the Holder of such
Certificated Note informing such Holder
of the Company's exercise of such option
with respect to such Certificated Note.
Deposit of Redemption Price. On or
before any redemption date, the Company
shall deposit with such Trustee an
amount of money sufficient to pay the
redemption price, plus interest accrued
to such redemption date, for all the
Certificated Notes or portions thereof
and which are to be repaid on such
43
redemption date. Such Trustee will use
such money to repay such Certificated
Notes pursuant to the terms set forth in
such Notes.
Payments of Principal Trustee Notice to Company of Option
and Interest Upon To Be Repaid. Upon receipt of
Exercise of Optional notice of exercise of the option
Repayment (Except for repayment and the Global
Pursuant to Company's Securities representing the Certfi-
Exercise of Optional cated Notes so to be repaid as set
Reset or Optional forth in such Notes, the Trustee
Extension): shall (unless such notice was received
pursuant to the Company's exercise of an
optional reset or an optional extension
of maturity, in each of which cases the
relevant procedures set forth above are
to be followed) give notice to the
Company not less than 20 days prior to
each Optional Repayment Date of such
Optional Repayment Date and of the
principal amount of Certificated Notes
to be repaid on such Optional Repayment
Date.
Deposit of Repayment Price. On or prior
to any Optional Repayment Date, the
Company shall deposit with such Trustee
an amount of money sufficient to pay the
optional repayment price, and accrued
interest thereon to such date, of all
the Certificated Notes or portions
thereof which are to be repaid on such
date. Such Trustee will use such money
to repay such Certificated Notes
pursuant to the terms set forth in such
Notes.
Procedure for Rate The Company and the Agents will
Setting and Posting: discuss from time to time the aggregate
principal amount of, the issuance price
of, and the interest rates to be borne
by, Notes that may be sold as a result
of the solicitation of orders by the
Agents. If the Company decides to set
prices of, and rates borne by, any Notes
44
in respect of which the Agents are to
solicit orders (the setting of such
prices and rates to be referred to
herein as "posting") or if the Company
decides to change prices or rates
previously posted by it, it will
promptly advise the Agents of the prices
and rates to be posted.
Acceptance and Unless otherwise instructed by the
Rejection of Orders: Company, each Agent will advise the
Company promptly by telephone of all
orders to purchase Certificated Notes
received by such Agent, other than those
rejected by the Agent in whole or in
part in the reasonable exercise of its
discretion. Unless otherwise agreed by
the Company and the Agents, the Company
has the sole right to accept orders to
purchase Certificated Notes and may
reject any such orders in whole or in
part. Before accepting any order to
purchase a Certificated Note to be
settled in less than three Business
Days, the Company shall verify that the
Trustee will have adequate time to
prepare and authenticate such Note.
Preparation of If any order to purchase a Certifi-
Pricing Supplement: cated Note is accepted by or on
behalf of the Company, the Company will
prepare a pricing supplement (a "Pricing
Supplement") reflecting the interest
rates and other terms of such Certified
Note and will arrange to have the
Pricing Supplement filed with the
Commission via the Commission's XXXXX
system in accordance with the applicable
paragraph of Rule 424(b) under the Act
and will supply at least ten copies
thereof (and additional copies if
requested) to the Agent which presented
the order (the "Presenting Agent") at
(unless otherwise specified by the
Presenting Agent in writing) the
45
following address:
If to Salomon Brothers Inc:
Salomon Brothers Inc
0000 Xxxxxx Xxxxx Xxxxxxx
Xxxxx, Xxxxxxx 00000
Attention: Xxxxxxx Xxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
or
If to Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated
Xxxxxxx Xxxxx & Co. - Tritech
Services
0 Xxxxxxxxx Xxxxx
Corporate Park 000
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Final Prospectus Unit/
Xxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000/26/27
Telecopy: (000) 000-0000
also, for record keeping
purposes, please send a copy to
Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated
Xxxxxxx Xxxxx World Headquarters
World Financial Center, North Tower
10th Floor
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-1310
Attention: MTN Product Management
or, if to another Presenting Agent,
to the address specified
by it to the Company.
The Presenting Agent will cause a
Prospectus and Pricing Supplement to be
46
delivered to the purchaser of such
Certificated Note.
In each instance that a Pricing
Supplement is prepared, the Presenting
Agent will affix the Pricing Supplement
to Prospectuses prior to their use.
Outdated Pricing Supplements (other than
those retained for files) will be
destroyed.
Suspension of Solici- The Company reserves the right, in
tation; Amendment or its sole discretion, to instruct
Supplement: the Agents to suspend at any time
for any period of time or permanently,
the solicitation of orders to purchase
Certificated Notes. Upon receipt of such
instructions, the Agents will forthwith
suspend solicitation until such time as
the Company has advised them that such
solicitation may be resumed.
In the event that at the time the
Company suspends solicitation of
purchases there shall be any orders
outstanding for settlement, the Company
will promptly advise the 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, together with the
appropriate Pricing Supplement, may be
delivered in connection with the
settlement of such orders. The Company
will have the sole responsibility for
such decision and for any arrangements
that may be made in the event that the
Company determines that such orders may
not be settled or that copies of such
Prospectus may not be so delivered.
If the Company decides to amend or
supplement the Registration Statement or
the Prospectus, it will promptly advise
47
the Agents and furnish the Agents 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 Agency Agreement. Subject to the
provisions of the Agency 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 pursuant to
the applicable paragraph of Rule 424(b).
Procedure for Rate When the Company has determined to
Changes: change the interest rates of Certifi-
cated Notes being offered, it will
promptly advise the Agents and the
Agents will forthwith suspend
solicitation of orders. The Agents will
telephone the Company with
recommendations as to the changed
interest rates. At such time as the
Company has advised the Agents of the
new interest rates, the Agents may
resume solicitation of orders. Until
such time only "indications of interest"
may be recorded.
Delivery of Prospectus: A copy of the Prospectus and a
Pricing Supplement relating to a
Certificated Note must accompany or
precede the earliest of any written
offer of such Certificated Note,
confirmation of the purchase of such
Certificated Note and payment for such
Certificated Note by its purchaser. If
48
notice of a change in the terms of the
Certificated Notes is received by the
Agents between the time an order for a
Certificated Note is placed and the time
written confirmation thereof is sent by
the Presenting Agent to a customer or
his agent, such confirmation shall be
accompanied by a Prospectus and Pricing
Supplement setting forth the terms in
effect when the order was placed.
Subject to "Suspension of Solicitation;
Amendment or Supplement" above, the
Presenting Agent will deliver a
Prospectus and Pricing Supplement as
herein described with respect to each
Certificated Note sold by it. The
Company will make such delivery if such
Certificated Note is sold directly by
the Company to a purchaser (other than
any Agent).
Confirmation: For each order to purchase a
Certificated Note solicited by any Agent
and accepted by or on behalf of the
Company, the Presenting Agent will issue
a confirmation to the purchaser, with a
copy to the Company, setting forth the
details set forth above and delivery and
payment instructions.
Settlement: The receipt by the Company of
49
immediately available funds in exchange
for an authenticated Certificated Note
delivered to the Presenting Agent and
the Presenting Agent's delivery of such
Certificated Note against receipt of
immediately available funds shall, with
respect to such Certificated Note,
constitute "settlement". All orders
accepted by the Company will be settled
on the third Business Day following the
date of sale pursuant to the timetable
for settlement set forth below, unless
the Company and the purchaser agree to
settlement on another day which shall be
no earlier than the next Business Day
following the date of sale.
Settlement Procedures: Settlement Procedures with regard
to each Certificated Note sold
by the Company through any
Agent, as agent, shall be as
follows:
A. The Presenting Agent will advise the
Company by telephone of the following
settlement information, in time for the
Trustee to prepare and authenticate the
required Note:
1. Name in which such Certificated Note
is to be registered ("Registered
Owner").
2. Address of the Registered Owner and
address for payment of principal and
interest.
3. Taxpayer identification number of the
Registered Owner (if available).
4. Principal or face amount.
5. Stated Maturity.
6. In the case of a Fixed Rate
Certificated Note, the interest rate or,
in the case of a Floating Rate
Certificated Note, the initial interest
rate (if known at such time), Interest
Rate Basis, Index Maturity, Interest
Reset Period, Interest Reset Dates,
Spread or Spread Multiplier (if any),
Minimum Interest Rate (if any) and
Maximum Interest Rate (if any).
7. Interest Payment Dates and the
Interest Payment Period.
50
8. Specified Currency and whether the
option to elect payment in a Specified
Currency applies and if the Specified
Currency is not U.S. dollars, the
authorized denominations.
9. Redemption, repayment or extension
provisions, if any.
10. Settlement date.
11. Price (including currency).
12. Presenting Agent's commission,
determined as provided in Section 2 of
the Agency Agreement.
13. Whether such Certificated Note is
issued at an original issue discount,
and, if so, the total amount of OID, the
yield to maturity and the initial
accrual period OID.
B. The Company will advise the Trustee
by telephone (confirmed in writing at
any time on the sale date) or electronic
transmission of the information set
forth in Settlement Procedure "A" above
and the name of the Presenting Agent.
C. The Company will deliver to the
Trustee a pre-printed four-ply packet
for such Certificated Note, which packet
will contain the following documents in
forms that have been approved by
Company, the Agents and the Trustee:
51
1. Certificated Note with customer
confirmation.
2. Stub One - For Trustee.
3. Stub Two - For the Presenting Agent.
4. Stub Three - For the Company.
D. The Trustee will complete such
Certificated Note and will authenticate
such Certificated Note and deliver it
(with the confirmation) and Stubs One
and Two to the Presenting Agent, all in
accordance with the written directions
(or oral instructions confirmed in
writing on the next Business Day) of the
Company at (unless, otherwise specified
by the Presenting Agent in writing) the
following address: in the case of
Salomon Brothers Inc, to the Bank of New
York, Dealer Clearance, Xxx Xxxx Xxxxxx,
0xx Xxxxx, Xxx Xxxx, XX 00000,
Attention: Salomon Account, or if to
Xxxxxxx Lynch, Xxxxxx, Xxxxxx & Xxxxx
Incorporated to Xxxxxxx Lynch, Pierce,
Xxxxxx & Xxxxx Incorporated, Money
Market Clearance - MTNs, 00 Xxxxxxx
Xxxxxx, Xxxxxx X, Xxx Xxxx, Xxx Xxxx
00000, Attention: Xxxxx Xxxxxxx or, if
to another Presenting Agent to the
address specified by the Company. The
Presenting Agent will acknowledge
receipt of the Note by stamping or
otherwise marking Stub One and returning
it to the Trustee. Such delivery will be
made only against such acknowledgment of
receipt. In the event that the
52
instructions given by the Presenting
Agent for payment to the account of the
Company are revoked, the Company will as
promptly as possible wire transfer to
the account of the Presenting Agent an
amount of immediately available funds
equal to the amount of such payment
made.
E. The Presenting Agent will deliver
such Certificated Note (with the
confirmation) to the customer against
payment in immediately payable funds.
The Presenting Agent will obtain the
acknowledgment of receipt of such
Certificated Note by retaining Stub Two.
F. The Trustee will send Stub Three to
the Company by first-class mail.
Settlement Procedures For orders of Certificated Notes
Timetable: solicited by any Agent, as agent,
and accepted by the Company, Settlement
Procedures "A" through "F" set forth
above shall be completed on or before
the respective times (New York City
time) set forth below:
53
Settlement
Procedure Time
A 2:00 P.M. on the day
before settlement
B-C 3:00 P.M. on the day
before settlement
D 2:15 P.M. on settlement
date
E 3:00 P.M. on settlement
date
F 5:00 P.M. on settlement
date
Failure To Settle: If a purchaser fails to accept
delivery of and make payment for any
Certificated Note, the Presenting Agent
will notify the Company and the Trustee
by telephone and return such
Certificated Note to the Trustee. Upon
receipt of such notice, the Company will
immediately wire transfer to the account
of the Presenting Agent an amount equal
to the amount previously credited to the
account of Company in respect of such
Certificated Note. Such wire transfer
will be made on the settlement date, if
possible, and in any event not later
than the Business Day following the
settlement date. If the failure shall
have occurred for any reason other than
a default by the Presenting Agent in the
performance of its obligations hereunder
and under the Agency Agreement, then the
Company will reimburse the Presenting
Agent or the Trustee, as appropriate, on
an equitable basis for its loss of the
use of the funds during the period when
they were credited to the account of the
Company. Immediately upon receipt of the
Certificated Note in respect of which
such failure occurred, the Trustee will
54
cancel such Certificated Note in
accordance with the Indenture and so
advise the Company and the Trustee will
make appropriate entries in its records.
Trustee Not To Nothing herein shall be deemed to
Risk Funds: require the Trustee to risk or expend
its own funds in connection with any
payment to the Company, the Agents or
the purchaser, it being understood by
all parties that payments made by the
Trustee to the Company, the Agents or
the purchaser shall be made only to the
extent that funds are provided to the
Trustee for such purpose.
Authenticity of The Company will cause the Trustee
Signatures: to furnish the Agents from time to time
with the specimen signatures of each of
the Trustee's officers, employees or
agents who has been authorized by the
Trustee to authenticate Certificated
Notes, but no Agent will have any
obligation or liability to the Company
or the Trustee in respect of the
authenticity of the signature of any
officer, employee or agent of the
Company or the Trustee on any
Certificated Note.
Payment of Expenses: Each Agent shall forward to the Company,
on a monthly basis, a statement of the
out-of-pocket expenses incurred by such
Agent during that month that are
reimbursable to it pursuant to the terms
of the Agency Agreement. The Company
will remit payment to the Agents
currently on a monthly basis.
Advertising Costs: The Company will determine with the
Agents the amount of advertising that
may be appropriate in soliciting orders
to purchase the Certificated Notes.
Advertising expenses will be paid by the
Company.
55
Periodic Statements Periodically, the
Trustee will send from the Trustee: to
the Company a statement setting forth
the principal amount of Certificated
Notes Outstanding as of that date and
setting forth a brief description of any
sales of Certificated Notes which the
Company has advised the Trustee but
which have not yet been settled.
EXHIBIT B
CPC International Inc.
Medium Term Notes, Series F
Due More Than Nine Months
from Date of Issue
TERMS AGREEMENT
[ ], 199[ ]
Attention:
Subject in all respects to the terms and conditions of the Selling Agency
Agreement (the "Agreement") dated , 1997, between Salomon Brothers Inc, Xxxxxxx
Lynch, Xxxxxx, Xxxxxx & Xxxxx Incorporated and you, the undersigned agrees to
purchase the following Notes of CPC International Inc.:
[Add additional terms as may be needed to identify the Notes.] Specified
Currency (if other than U.S. dollars):
Aggregate Principal Amount: $
Interest Rate:
Stated Maturity:
Interest Payment Dates:
Regular Record Dates:
Discount or Commission: % of Principal Amount
Purchase Price: % of Principal Amount [plus
accrued interest from
, 199 ]
Purchase Date and Time:
Place for Delivery of Notes
2
and Payment Therefor:
Method of Payment:
Modification, if any, in the requirements to deliver the documents specified in
Section 6(b) of the Agreement:
[Purchaser]
By: ________________________
Accepted:
CPC International Inc.
By: ________________________
Title:
