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
August 19, 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
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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: 333-32971 ),
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
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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,
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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.
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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.
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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
h erein 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
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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
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the issuance of any such stop order and, if issued, to obtain as soon
as pos sible 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
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services and any other material press releases and announcements. 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
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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
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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 und er 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
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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:
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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
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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);
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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
Xxxxxxxxx'x, Inc. Delaware
EXHIBIT A
CPC International Inc.
Medium-Term Note Administrative Procedures
August 19, 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
-3-
without coupons (a "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 reserva-
-4-
tion of a series of CUSIP 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
the book-entry sys-
-5-
tem 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 Global Security
-6-
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 ma-
-7-
ture 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
-8-
that, in the case of Floating Rate Book-Entry
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 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,
-9-
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
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
-10-
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 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, ex-
-11-
cept that in the 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 Payment of Interest Only. Promptly after each
and Interest: 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, the Company
-12-
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
-13-
the Company with 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
respon-
-14-
sible for forwarding payments and materials
directly to the beneficial owner of such Note.
Procedures upon Company Notice to Trustee Regarding Exercise of
Company's Exercise Optional Reset. Not less than 45 or more than 60
of Optional Reset days before an Optional Reset Date as set forth in
or Optional a Book-Entry Note, the Company will notify the
Extension of Maturity: 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
-15-
any, for 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
-16-
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 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 Exercise of
Company's Exercise Optional Redemption. At least 45 days prior to the
of Optional Redemption: 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 Option To Be
pal and Interest Repaid. Upon receipt of notice of exercise of the
upon Exercise of option for repayment and the Global Securities
Optional Repayment representing the Book-Entry Notes so to be repaid
(Except Pursuant to as set forth in such Notes, the Trustee shall
Company's Exercise (unless such notice was received pursuant to the
of Optional Reset or Company's exercise of an optional reset or an
Optional Extension): optional extension of maturity, in each of
-18-
which cases the relevant procedures set forth
above are to be followed) give notice to the
Company not less than 20 days prior to each
Optional Repayment Date of such Optional Repayment
Date and of the principal amount of Book-Entry
Notes to be repaid on such Optional Repayment
Date.
Deposit of Repayment Price. On or prior to any
Optional Repayment Date, the Company shall deposit
with such Trustee an amount of money sufficient to
pay the optional repayment price, and accrued
interest thereon to such date, of all the
Book-Entry Notes or portions thereof which are to
be repaid on such date. Such Trustee will use such
money to repay such Book-Entry Notes pursuant to
the terms set forth in such Notes.
Procedure for Rate The Company and the Agents will discuss from time
Setting and Posting: 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 Unless otherwise instructed by the Company, each
Rejection of Orders: Agent will advise the Company promptly by
telephone of all orders to purchase Book-Entry
Notes received by such Agent, other
-19-
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 right to accept orders
to purchase Book-Entry Notes and may reject any
such orders in whole or in part.
Preparation of If any order to purchase a Book-Entry Note is
Pricing Supplement: 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:
-20-
Xxxxxxx Xxxxx & Co. - Tritech
Services
00-X Xxxxxxxx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Final Prospectus Unit/
Xxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000
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 its sole
tation; Amendment or discretion, to instruct the Agents to suspend at
Supplement: 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 suspend so-
-21-
licitation 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 to change the
Changes: 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 Ba-
-24-
sis, initial interest rate (if known 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
-25-
telephone of such CUSIP number as soon as
practicable. 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".
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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.
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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
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described in Settlement Procedures "G" and
"H" will be settled in accordance with SDFS
operating procedures in effect on the
settlement date.
X. The Trustee will, 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 solicited by any
Timetable: 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
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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
cancellation message to
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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
represented by the surrendered Global Security and
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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 Security representing the other
Book-Entry Notes to have been
-32-
represented by such Global Security and will make
appropriate entries in its records.
Trustee Not to Risk Nothing herein shall be deemed to require the
Funds: 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 to furnish the
Signatures: 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.
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Periodic Statements Periodically, the Trustee will send to the Company
from the Trustee: 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.
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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 transfer
Exchanges: 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
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will mature only on an 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 Payment
Period, on the third Wednesday of the two months
-37-
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 on Fixed
Interest: 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
-38-
Floating Rate Certificated 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 Interest, if any, on each Certifi- cated Note will
and Interest: 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 Exercise of
Company's Exercise Optional Reset. Not less than 45 or more than 60
of Optional Reset days before an Optional Reset Date as set forth in
or Optional a Certificated Note, the Company will notify the
Extension of Trustee whether it is exercising its option to
Maturity: reset the Interest Rate or Spread or Spread
Multiplier, as the case may be, for such
Certificated Note, and if so, (i) the new Interest
Rate or Spread or Spread Multiplier, as the case
may be, for such Certificated Note during the
period from such Optional Reset Date to the next
Optional Reset Date as set forth in such
Certificated Note or, if there is no such next
Optional Reset Date, to the Stated Maturity of
such Certificated Note (the "Subsequent Interest
Period"); and (ii) the provisions, if any, for
redemption of such Certificated Note during such
Subsequent Interest Period, including the date or
dates on which or the period or periods during
which such redemption may occur during such
Subsequent Interest Period.
Company Notice to Trustee Regarding Exercise of
Optional Extension of Maturity. If the Company
elects to exercise an option, as set forth in a
Certificated Note, to extend the
-40-
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 Notes to be
-41-
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
-42-
the principal amount, plus interest accrued to
such old Stated Maturity or Optional Reset Date,
as the case may be, for all the Certificated Notes
or portions thereof 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 Exercise of
Company's Exercise Optional Redemption. At least 45 days prior to the
Of Optional Redemption: 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 redemption date. Such Trustee will
use such money to repay such Certi-
-43-
ficated Notes pursuant to the terms set forth in
such Notes.
Payments of Principal Trustee Notice to Company of Option To Be Repaid.
and Interest Upon Upon receipt of notice of exercise of the option
Exercise of Optional for repayment and the Global Securities
Repayment (Except representing the Certficated Notes so to be
Pursuant to Company's repaid as set forth in such Notes, the Trustee
Exercise of Optional shall (unless such notice was received pursuant to
Reset or Optional the Company's exercise of an optional reset or an
Extension): 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 discuss from time
Setting and Posting: 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 in respect of which the
-44-
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 Company, each
Rejection of Orders: 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 Certificated Note is
Pricing Supplement: 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
-45-
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, Pierce,
Xxxxxx & Xxxxx Incorporated
Xxxxxxx Xxxxx & Co. - Tritech
Services
00-X Xxxxxxxx Xxxxx
Xxxxxxxxxx, Xxx Xxxxxx 00000
Attention: Final Prospectus Unit/
Xxxxxxx Xxxxxxxxx
Telephone: (000) 000-0000
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 Certificated Note.
-46-
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 its sole
tation; Amendment or discretion, to instruct the Agents to suspend at
Supplement: 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 the Agents and furnish the Agents
with the proposed amendment or supplement and with
-47-
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 change the
Changes: interest rates of Certificated 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 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
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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 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:
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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.
8. Specified Currency and whether the
option to elect payment in a Specified
Currency applies and if the Specified
Currency is not
-50-
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:
1. Certificated Note with customer
confirmation.
2. Stub One - For Trustee.
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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 instructions given by the Presenting
Agent for payment to the account of the
Company are revoked, the Company will as
promptly as possible wire
-52-
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 solicited by any
Timetable: 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:
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
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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 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 require the
Risk Funds: 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 to furnish the
Signatures: Agents from time to time with the specimen
signatures
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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.
Periodic Statements Periodically, the Trustee will send to the Company
from the Trustee: 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 August 19, 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 and Payment Therefor:
-2-
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:
