Contract
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE (HEREINAFTER DEFINED) AND IS
REGISTERED IN THE NAME OF A DEPOSITARY (AS DEFINED IN THE INDENTURE) OR A NOMINEE OF A DEPOSITARY.
THIS NOTE IS NOT EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO
TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE
OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A
NEW YORK CORPORATION (βDTCβ), TO THE TRUST (HEREINAFTER DEFINED) OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND UNLESS ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
CUSIP No.: 00000XXX0
Principal Amount: U.S. $200,000,000
PRINCIPAL LIFE INCOME FUNDINGS TRUST 35
EXTENDIBLE SECURED MEDIUM-TERM NOTE
EXTENDIBLE SECURED MEDIUM-TERM NOTE
Original Issue Date: March 19, 2008
Issue Price: 100.0%
Stated Maturity Date: The Initial Maturity Date, the Final Maturity Date or any other maturity
date resulting from the failure of the holder of this Note to elect to extend the maturity of all
or a portion of this Note (as set forth in Schedule II); provided, however, that in no event shall
the maturity of this Note be extended beyond the Final Maturity Date.
Initial Maturity Date: April 9, 2009
Final Maturity Date: March 19, 2010
Settlement Date: March 19, 2008
Securities Exchange Listing: Yes o No. Γ½ If yes,
indicate name(s) of Securities Exchange(s): __________________
Depositary: The Depository Trust Company
Authorized Denominations: $100,000 and integral multiples of $1,000 in excess thereof; the holder
of this Note may extend a portion of this Note solely in Authorized Denominations and the Principal
Amount of this Note remaining after an extension must also be in Authorized Denominations.
Collateral held in the Trust: Principal Life Insurance Company Funding Agreement No. 6-15308, the
related Principal Financial Group, Inc. Guarantee which fully and unconditionally guarantees
the payment obligations of Principal Life Insurance Company under the Funding Agreement, all
proceeds of the Funding Agreement and the related Guarantee
and all rights and books and records pertaining to the foregoing.
Additional Amounts to be Paid: o Yes Γ½ No
Interest Rate or Formula:
Fixed Rate Note: o Yes Γ½ No. If yes,
Interest Rate:
Interest Payment Frequency:
Interest Payment Dates:
Day Count Convention:
Additional/Other Terms:
Interest Payment Frequency:
Interest Payment Dates:
Day Count Convention:
Additional/Other Terms:
Amortizing Note: o Yes Γ½ No. If yes,
Amortization schedule or formula:
Additional/Other Terms:
Additional/Other Terms:
Discount Note: o Yes Γ½ No. If yes,
Total Amount of Discount:
Initial Accrual Period of Discount:
Interest Payment Dates:
Additional/Other Terms
Initial Accrual Period of Discount:
Interest Payment Dates:
Additional/Other Terms
Redemption Provisions: o Yes Γ½ No. If yes,
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
Additional/Other Terms:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
Additional/Other Terms:
Repayment Provisions: o Yes Γ½ No. If yes,
Repayment Date(s):
Repayment Price:
Additional/Other Terms:
Repayment Price:
Additional/Other Terms:
Floating Rate Note: Yes Γ½ No. o If yes,
Regular Floating Rate Notes Γ½
Inverse Floating Rate Notes o
Floating Rate/ Fixed Rate Notes: o
Inverse Floating Rate Notes o
Floating Rate/ Fixed Rate Notes: o
Interest Rate: Three-Month USD LIBOR (except as noted under βInterest Rate Basisβ)
plus the applicable Spread set forth in attached Schedule II.
Interest Rate Basis(es): Three-Month USD LIBOR; provided, however, that for the initial
Interest Reset Period (from and including the Original Issue Date to but excluding the
Interest Payment Date occurring in July 2008), the Interest Rate Basis will be an interpolated
rate between Three-Month USD LIBOR and Four-Month USD LIBOR. With respect to the final
interest payment on any maturity date prior to the Final Maturity Date and on the Final
Maturity Date, the Interest Rate Basis will be (i) One-Month USD LIBOR, if the final Interest
Reset Period is a period of one month; (ii) Two-Month USD LIBOR, if the final
Interest Reset
Period is a period of two months; (iii) Three-Month USD LIBOR, if the final Interest Reset
Period is a period of three months; and (iv) an interpolated rate between Two-Month USD LIBOR
and Three-Month USD LIBOR, if the final Interest Reset Period is a period longer than two
months and shorter than three months.
LIBOR Γ½
LIBOR Reuters Page: LIBOR01
LIBOR Currency: U.S. Dollars
LIBOR Currency: U.S. Dollars
EURIBOR o
CMT Rate o
CMT Rate o
Designated Reuters Page:
If FEDCMT
o Weekly Average
o Monthly Average
o Monthly Average
Designated CMT Maturity Index:
CD Rate o
Commercial Paper Rate o
Constant Maturity Swap Rate o
Eleventh District Cost of Funds Rate o
Federal Funds Open Rate o
Federal Funds Rate o
Prime Rate o
Treasury Rate o
Commercial Paper Rate o
Constant Maturity Swap Rate o
Eleventh District Cost of Funds Rate o
Federal Funds Open Rate o
Federal Funds Rate o
Prime Rate o
Treasury Rate o
Index Maturity: Three-month (subject to the exceptions listed above in βInterest Rate Basisβ)
Spread: See attached Schedule II.
Spread Multiplier: Not applicable
Initial Interest Rate, if any: The Initial Interest Rate in effect as of the Original Issue
Date shall be an interpolated rate between Three-Month USD LIBOR and Four-Month USD LIBOR
determined on the second London Banking Day preceding the Original Issue Date plus
0.25%.
Initial Interest Reset Date: July 9, 2008
Interest Reset Dates: Quarterly, on January 9, April 9, July 9, and October 9 of each year,
commencing on July 9, 2008, subject to adjustment in accordance with the Modified Following
Business Day Convention.
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Interest Determination Date(s): The second London Banking Day preceding the related Interest
Reset Date.
Interest Payment Dates: Quarterly, on January 9, April 9, July 9 and October 9 of each year,
subject to adjustment in accordance with the Modified Following Business Day Convention, and
the Final Maturity Date; provided that the final Interest Payment Date for a Note maturing
prior to the Final Maturity Date will be the relevant maturity date, and interest for the
final Interest Reset Period will accrue from and including the Interest Payment Date
immediately preceding such relevant maturity date to but excluding such relevant maturity
date.
Initial Interest Payment Date: July 9, 2008
Maximum Interest Rate, if any: Not applicable
Minimum Interest Rate, if any: Not applicable
Fixed Rate Commencement Date, if any: Not applicable
Floating Rate Commencement Date, if any: Not applicable
Fixed Interest Rate, if any: Not applicable
Day Count Convention: Actual/360
Additional/Other Terms: See attached Schedule II.
Regular Record Date(s): The date that is fifteen (15) calendar days preceding the applicable
Interest Payment Date.
Sinking Fund: Not applicable
Specified Currency: U.S. Dollars
Exchange Rate Agent: Not applicable
Calculation Agent: Citibank, N.A.
Additional/Other Terms: See attached Schedule II.
The Principal Life Income Fundings Trust designated above (the βTrustβ), for value received,
hereby promises to pay to Cede & Co., or its registered assigns, the Principal Amount specified
above on the Stated Maturity Date specified above and, if so specified above, to pay interest
thereon from the Original Issue Date specified above or from the most recent Interest Payment Date
specified above to which interest has been paid or duly provided for at the rate per annum
determined in accordance with the provisions on the reverse hereof and as specified above, until
the principal hereof is paid or made available for payment. Unless otherwise specified above,
payments of principal, premium, if any, and interest hereon will be made in the lawful currency of
the United States of America (βU.S. Dollarsβ or βUnited States dollarsβ). If the Specified Currency
specified above is other than U.S. Dollars, the Holder (as defined in the Indenture) shall receive
such payments in such Foreign Currency (as hereinafter defined). The βPrincipal Amountβ of this
Note at any time means (1) if this Note is a Discount Note (as hereinafter defined), the Amortized
Face Amount (as hereinafter defined) at such time (as defined in Section 3(c) on the
reverse hereof) and (2) in all other cases, the Principal Amount hereof. Capitalized terms not
otherwise defined herein shall have their meanings set forth in the Indenture, dated as of the date
of the Pricing Supplement (the βIndentureβ), between Citibank, N.A., as the indenture trustee (the
βIndenture Trusteeβ), and the Trust, or on the face hereof.
This Note will mature on the Stated Maturity Date, unless its principal (or any installment of
its principal) becomes due and payable prior to the Stated Maturity Date, whether, as applicable,
by the declaration of acceleration of maturity, notice of redemption by the Trust or otherwise (the
Stated Maturity Date or any date prior to the Stated Maturity Date on which this Note becomes due
and payable, as the case may be, is referred to as the βMaturity Dateβ).
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A βDiscount Noteβ is any Note that has an Issue Price that is less than 100% of the Principal
Amount thereof by a percentage that is equal to or greater than 0.25% multiplied by the product of
the principal amount of the Notes and the number of full years to the Stated Maturity Date.
Unless otherwise specified above, the interest payable on each Interest Payment Date or the
Maturity Date will be the amount of interest accrued from and including the Original Issue Date or
from and including the last Interest Payment Date to which interest has been paid or duly provided
for, as the case may be, to, but excluding, such Interest Payment Date or the Maturity Date, as the
case may be.
Unless otherwise specified above, the interest payable on any Interest Payment Date will be
paid to the Holder on the Regular Record Date for such Interest Payment Date, which Regular Record
Date shall be the fifteenth (15th) calendar day, whether or not a Business Day, immediately
preceding the related Interest Payment Date; provided that, notwithstanding any provision of the
Indenture to the contrary, interest payable on any Maturity Date shall be payable to the Person to
whom principal shall be payable; and provided, further, that unless otherwise specified above, in
the case of a Note initially issued between a Regular Record Date and the Interest Payment Date
relating to such Regular Record Date, interest for the period beginning on the Original Issue Date
and ending on such Interest Payment Date shall be paid on the Interest Payment Date following the
next succeeding Regular Record Date to the Holder on such next succeeding Regular Record Date.
Payments of principal of, and premium, if any, and interest and other amounts due and owing,
if any, will be made through the Indenture Trustee to the account of DTC or its nominee and will be
made in accordance with depositary arrangements with DTC.
Unless otherwise specified on the face hereof, the Holder hereof will not be obligated to pay
any administrative costs imposed by banks in making payments in immediately available funds by the
Trust. Unless otherwise specified on the face hereof, any tax assessment or governmental charge
imposed upon payments hereunder, including, without limitation, any withholding tax, will be borne
by the Holder hereof.
REFERENCE IS XXXXXX MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH ON THE REVERSE
HEREOF. SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS
PLACE.
Unless the certificate of authentication hereon shall have been executed by the Indenture
Trustee pursuant to the Indenture, this Note shall not be entitled to any benefit under such
Indenture or be valid or obligatory for any purpose.
4
THE PRINCIPAL LIFE INCOME FUNDINGS TRUST SPECIFIED ON THE FACE OF THIS NOTE |
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Dated: Original Issue Date
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By: U.S. Bank Trust National Association, not in its individual capacity but solely as Trustee. | |||
By: | /s/ Xxxxx X. XβXxxx | |||
Authorized Officer |
CERTIFICATE OF AUTHENTICATION
This is one of the Notes of the Principal Life Income Fundings Trust specified on the face of
this Note referred to in the within-mentioned Indenture.
CITIBANK, N.A. As Indenture Trustee |
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Dated: Original Issue Date
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By: | /s/ Xxxxxxxx X. XxXxxxx | |||
Authorized Signatory |
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[REVERSE FORM OF NOTE]
Section 1. General. This Note is one of a duly authorized issue of Notes of the Trust. The
Notes are issued pursuant to the Indenture.
Section 2. Currency.
(a) Unless specified otherwise on the face hereof, this Note is denominated in, and payments
of principal, premium, if any, and/or interest, if any, will be made in U.S. Dollars. If specified
as the Specified Currency, this Note may be denominated in, and payments of principal, premium, if
any, and/or interest, if any, may be made in a single currency other than U.S. Dollars (a βForeign
Currencyβ). If this Note is denominated in a Foreign Currency, the Holder of this Note is required
to pay for this Note in the Specified Currency.
(b) Unless specified otherwise on the face hereof, if this Note is denominated in a Foreign
Currency, the Trust is obligated to make payments of principal of, and premium, if any, and
interest, if any, on, this Note in the Specified Currency. Any amounts so payable by the Trust in
the Specified Currency will be converted by the Exchange Rate Agent into U.S. Dollars for payment
to the Holder hereof unless otherwise specified on the face of this Note or the Holder elects, in
the manner described below, to receive these amounts in the Specified Currency. If this Note is
denominated in a Foreign Currency, any U.S. Dollar amount to be received by the Holder hereof will
be based on the highest bid quotation in The City of New York received by the Exchange Rate Agent
at approximately 11:00 A.M., New York City time, on the second Business Day preceding the
applicable payment date from three recognized foreign exchange dealers (one of whom may be the
Exchange Rate Agent) selected by the Exchange Rate Agent and approved by the Trust for the purchase
by the quoting dealer of the Specified Currency for U.S. Dollars for settlement on that payment
date in the aggregate amount of the Specified Currency payable to all Holders of the Notes
scheduled to receive U.S. Dollar payments and at which the applicable dealer commits to execute a
contract. All currency exchange costs will be borne by the Holders of the Notes by deductions from
any payments. If three bid quotations are not available, payments will be made in the Specified
Currency. If this Note is denominated in a Foreign Currency, the Holder of this Note may elect to
receive all or a specified portion of any payment of principal, premium, if any, and/or interest,
if any, in the Specified Currency by submitting a written request to the Indenture Trustee at its
Corporate Trust Office in The City of New York on or prior to the applicable Regular Record Date or
at least 15 calendar days prior to the Maturity Date, as the case may be. This written request may
be mailed or hand delivered or sent by cable, telex or other form of facsimile transmission. This
election will remain in effect until revoked by written notice delivered to the Indenture Trustee
on or prior to a Regular Record Date or at least 15 calendar days prior to the Maturity Date, as
the case may be. The Holder of a Note denominated in a Foreign Currency to be held in the name of a
broker or nominee should contact their broker or nominee to determine whether and how an election
to receive payments in the Specified Currency may be made. Unless specified otherwise on the face
hereof, if the Specified Currency is other than U.S. Dollars, a beneficial owner of a Note
represented by a global security which elects to receive payments of principal, premium, if any,
and/or interest, if any, in the Specified Currency must notify the participant through which it
owns its interest on or prior to the applicable Regular Record Date or at least 15 calendar days
prior to the Maturity
6
Date, as the case may be, of its election. The applicable participant must notify DTC of its
election on or prior to the third Business Day after the applicable Regular Record Date or at least
12 calendar days prior to the Maturity Date, as the case may be, and DTC will notify the Indenture
Trustee of that election on or prior to the fifth Business Day after the applicable Regular Record
Date or at least ten calendar days prior the Maturity Date, as the case may be. If complete
instructions are received by the participant from the applicable beneficial owner and forwarded by
the participant to DTC, and by DTC to the Indenture Trustee, on or prior to such dates, then the
applicable beneficial owner will receive payments in the Specified Currency.
(c) The Trust will indemnify the Holder hereof against any loss incurred as a result of any
judgment or order being given or made for any amount due under this Note and that judgment or order
requiring payment in a currency (the βJudgment Currencyβ) other than the Specified Currency, and as
a result of any variation between: (i) the rate of exchange at which the Specified Currency amount
is converted into the Judgment Currency for the purpose of that judgment or order; and (ii) the
rate of exchange at which the Holder, on the date of payment of that judgment or order, is able to
purchase the Specified Currency with the amount of the Judgment Currency actually received.
(d) Unless otherwise specified on the face hereof, if payment hereon is required to be made in
a Foreign Currency and such currency is unavailable due to the imposition of exchange controls or
other circumstances beyond the Trustβs control, then the Trust will be entitled to make payments
with respect hereto in U.S. Dollars on the basis of the Market Exchange Rate (as hereinafter
defined), computed by the Exchange Rate Agent, on the second Business Day prior to the particular
payment or, if the Market Exchange Rate is not then available, on the basis of the most recently
available Market Exchange Rate.
(e) The βMarket Exchange Rateβ for the Foreign Currency shall mean the noon dollar buying rate
in The City of New York for cable transfers for the Foreign Currency as certified for customs
purposes (or, if not so certified, as otherwise determined) by the Federal Reserve Bank of New
York.
(f) All determinations made by the Exchange Rate Agent shall be at its sole discretion and
shall, in the absence of manifest error, be conclusive for all purposes and binding on the Holder
hereof.
(g) All costs of exchange in respect of this Note, if denominated in a Foreign Currency, will
be borne by the Holder hereof.
(i) This Note will bear interest at the rate per annum specified on the face hereof.
Interest on this Note will be computed on the basis of a 360-day year of twelve 30-day
months.
7
(ii) Unless otherwise specified on the face hereof, the Interest Payment Dates for this
Note will be as follows:
Interest Payment Frequency | Interest Payment Dates | |
Monthly
|
Fifteenth day of each calendar month, beginning in the first calendar month following the month this Note was issued. | |
Quarterly
|
Fifteenth day of every third calendar month, beginning in the third calendar month following the month this Note was issued. | |
Semi-annual
|
Fifteenth day of every sixth calendar month, beginning in the sixth calendar month following the month this Note was issued. | |
Annual
|
Fifteenth day of every twelfth calendar month, beginning in the twelfth calendar month following the month this Note was issued. |
(iii) Unless otherwise specified on the face hereof, if any Interest Payment Date or the
Maturity Date of this Note falls on a day that is not a Business Day, the Trust will make
the required payment of principal, premium, if any, and/or interest or other amounts on
the next succeeding Business Day, and no additional interest will accrue in respect of
the payment made on that next succeeding Business Day.
(b) Floating Rate Notes. If this Note is specified on the face hereof as a
βFloating Rate Noteβ:
(i) Interest Rate Basis. Interest on this Note will be determined by reference to
the applicable Interest Rate Basis or Interest Rate Bases, which may, as described below,
include the CD Rate, the CMT Rate, the Commercial Paper Rate, the Constant Maturity Swap
Rate; the Eleventh District Cost of Funds Rate, the Federal Funds Open Rate, the Federal
Funds Rate, LIBOR, EURIBOR, the Prime Rate or the Treasury Rate (each as defined below).
(ii) Effective Rate. The rate derived from the applicable Interest Rate Basis or
Interest Rate Bases will be determined in accordance with the related provisions below.
The interest rate in effect on each day will be based on: (1) if that day is an Interest
Reset Date, the rate determined as of the Interest Determination Date immediately
preceding that Interest Reset Date; or (2) if that day is not an Interest Reset Date, the
rate determined as of the Interest Determination Date immediately preceding the most
recent Interest Reset Date.
(iii) Spread; Spread Multiplier; Index Maturity. The βSpreadβ is the number of
basis points (one one-hundredth of a percentage point) specified on the face hereof to be
added to or subtracted from the related Interest Rate Basis or Interest Rate Bases
applicable to this Note. The βSpread Multiplierβ is the percentage specified on the face
hereof of the related Interest Rate Basis or Interest Rate Bases applicable to this Note
by which the Interest Rate Basis or Interest Rate Bases will be multiplied to determine
the applicable interest rate. The βIndex Maturityβ is the period to maturity of the
8
instrument or obligation with respect to which the related Interest Rate Basis or
Interest Rate Bases will be calculated.
(iv) Regular Floating Rate Note. Unless this Note is specified on the face hereof as a
Floating Rate/Fixed Rate Note or an Inverse Floating Rate Note, this Note (a βRegular Floating
Rate Noteβ) will bear interest at the rate determined by reference to the applicable Interest
Rate Basis or Interest Rate Bases: (1) plus or minus the applicable Spread, if any; and/or (2)
multiplied by the applicable Spread Multiplier, if any. Commencing on the first Interest Reset
Date, the rate at which interest on this Regular Floating Rate Note is payable will be reset as
of each Interest Reset Date; provided, however, that the interest rate in effect for the period,
if any, from the Original Issue Date to the first Interest Reset Date will be the Initial
Interest Rate.
(v) Floating Rate/Fixed Rate Notes. If this Note is specified on the face hereof as a
βFloating Rate/Fixed Rate Noteβ, this Note will bear interest at the rate determined by
reference to the applicable Interest Rate Basis or Interest Rate Bases: (1) plus or minus the
applicable Spread, if any; and/or (2) multiplied by the applicable Spread Multiplier, if any.
Commencing on the first Interest Reset Date, the rate at which this Floating Rate/Fixed Rate
Note is payable will be reset as of each Interest Reset Date; provided, however, that: (A) the
interest rate in effect for the period, if any, from the Original Issue Date to the first
Interest Reset Date will be the Initial Interest Rate specified on the face hereof; and (B) the
interest rate in effect commencing on the Fixed Rate Commencement Date will be the Fixed
Interest Rate, if specified on the face hereof, or, if not so specified, the interest rate in
effect on the day immediately preceding the Fixed Rate Commencement Date.
(vi) Inverse Floating Rate Notes. If this Note is specified on the face hereof as an
βInverse Floating Rate Noteβ, this Note will bear interest at the Fixed Interest Rate minus the
rate determined by reference to the applicable Interest Rate Basis or Interest Rate Bases: (1)
plus or minus the applicable Spread, if any; and/or (2) multiplied by the applicable Spread
Multiplier, if any; provided, however, that interest on this Inverse Floating Rate Note will not
be less than zero. Commencing on the first Interest Reset Date, the rate at which interest on
this Inverse Floating Rate Note is payable will be reset as of each Interest Reset Date;
provided, however, that the interest rate in effect for the period, if any, from the Original
Issue Date to the first Interest Reset Date will be the Initial Interest Rate.
(vii) Interest Reset Dates. The period between Interest Reset Dates will be the
βInterest Reset Period.β Unless otherwise specified on the face hereof, the Interest Reset Dates
will be, in the case of this Floating Rate Note if by its terms it resets: (1) dailyβeach
business day; (2) weeklyβthe Wednesday of each week, with the exception of any weekly reset
Floating Rate Note as to which the Treasury Rate is an applicable Interest Rate Basis, which
will reset the Tuesday of each week; (3) monthlyβthe fifteenth day of each calendar month, with
the exception of any monthly reset Floating Rate Note as to which the Eleventh District Cost of
Funds Rate is an applicable Interest Rate Basis, which will reset on the first calendar day of
the month; (4) quarterlyβthe fifteenth day of March, June, September and December of each year;
(5) semi-annuallyβthe fifteenth day of the two months of each year specified on the face
hereof; and (6) annuallyβthe fifteenth day of the month of each year specified on the
9
face hereof; provided, however, that, with respect to a Floating Rate/Fixed Rate Note, the rate
of interest thereon will not reset after the particular Fixed Rate Commencement Date. If any
Interest Reset Date for this Floating Rate Note would otherwise be a day that is not a Business
Day, the particular Interest Reset Date will be postponed to the next succeeding Business Day,
except that in the case of a Floating Rate Note as to which LIBOR is an applicable Interest Rate
Basis and that Business Day falls in the next succeeding calendar month, the particular Interest
Reset Date will be the immediately preceding Business Day.
(viii) Interest Determination Dates. The interest rate applicable to a Floating Rate
Note for an Interest Reset Period commencing on the related Interest Reset Date will be
determined by reference to the applicable Interest Rate Basis as of the particular βInterest
Determination Dateβ, which will be: (1) with respect to the Federal Funds Open Rateβthe related
Interest Reset Date; (2) with respect to the Federal Funds Rate and the Prime Rateβthe Business
Day immediately preceding the related Interest Reset Date; (3) with respect to the CD Rate, the
Commercial Paper Rate and the CMT Rateβthe second Business Day preceding the related Interest
Reset Date; (4) with respect to the Constant Maturity Swap Rateβthe second U.S. Government
Securities business day preceding the related Interest Reset Date, provided, however, that if
after attempting to determine the Constant Maturity Swap Rate, such rate is not determinable for
a particular Interest Determination Date, then such Interest Determination Date shall be the
first U.S. Government Securities business day preceding the original interest determination date
for which the Constant Maturity Swap Rate can be determined; (5) with respect to the Eleventh
District Cost of Funds Rateβthe last working day of the month immediately preceding the related
Interest Reset Date on which the Federal Home Loan Bank of San Francisco publishes the Eleventh
District Index (as defined below); (6) with respect to LIBOR and EURIBORβthe second London
Banking Day (as defined below) preceding the related Interest Reset Date; and (7) with respect
to the Treasury Rateβthe day of the week in which the related Interest Reset Date falls on
which day Treasury Bills (as defined below) are normally auctioned (i.e., Treasury Bills are
normally sold at auction on Monday of each week, unless that day is a legal holiday, in which
case the auction is normally held on the following Tuesday, except that the auction may be held
on the preceding Friday); provided, however, that if an auction is held on the Friday of the
week preceding the related Interest Reset Date, the Interest Determination Date will be the
preceding Friday. The Interest Determination Date pertaining to a Floating Rate Note, the
interest rate of which is determined with reference to two or more Interest Rate Bases, will be
the latest Business Day which is at least two Business Days before the related Interest Reset
Date for the applicable Floating Rate Note on which each Interest Reset Basis is determinable.
βLondon Banking Dayβ means a day on which commercial banks are open for business (including
dealings in the LIBOR Currency) in London.
(ix) Calculation Dates. The interest rate applicable to each Interest Reset Period will
be determined by the Calculation Agent on or prior to the Calculation Date (as defined below),
except with respect to LIBOR, EURIBOR and the Eleventh District Cost of Funds Rate, which will
be determined on the particular Interest Determination Date. Upon request of the Holder of a
Floating Rate Note, the Calculation Agent will disclose the interest rate then in effect and, if
determined, the interest rate that will become effective as a result of a determination made for
the next succeeding Interest Reset Date with respect to such Floating
10
Rate Note. The βCalculation Dateβ, if applicable, pertaining to any Interest Determination Date
will be the earlier of: (1) the tenth calendar day after the particular Interest Determination
Date or, if such day is not a Business Day, the next succeeding Business Day; or (2) the
Business Day immediately preceding the applicable Interest Payment Date or the Maturity Date, as
the case may be.
(x) Maximum or Minimum Interest Rate. If specified on the face hereof, this Note may
have either or both of a Maximum Interest Rate or a Minimum Interest Rate. If a Maximum Interest
Rate is so designated, the interest rate for a Floating Rate Note cannot ever exceed such
Maximum Interest Rate and in the event that the interest rate on any Interest Reset Date would
exceed such Maximum Interest Rate (as if no Maximum Interest Rate were in effect) then the
interest rate on such Interest Reset Date shall be the Maximum Interest Rate. If a Minimum
Interest Rate is so designated, the interest rate for a Floating Rate Note cannot ever be less
than such Minimum Interest Rate and in the event that the interest rate on any Interest Reset
Date would be less than such Minimum Interest Rate (as if no Minimum Interest Rate were in
effect) then the interest rate on such Interest Reset Date shall be the Minimum Interest Rate.
Notwithstanding anything to the contrary contained herein, the interest rate on a Floating Rate
Note shall not exceed the maximum interest rate permitted by applicable law.
(xi) Interest Payments. Unless otherwise specified on the face hereof, the Interest
Payment Dates will be, in the case of a Floating Rate Note which resets: (1) daily, weekly or
monthlyβthe fifteenth day of each calendar month or on the fifteenth day of March, June,
September and December of each year, as specified on the face hereof; (2) quarterlyβthe
fifteenth day of March, June, September and December of each year; (3) semi-annuallyβthe
fifteenth day of the two months of each year specified on the face hereof; and (4) annuallyβthe
fifteenth day of the month of each year as specified on the face hereof. In addition, the
Maturity Date will also be an Interest Payment Date. If any Interest Payment Date other than the
Maturity Date for this Floating Rate Note would otherwise be a day that is not a Business Day,
such Interest Payment Date will be postponed to the next succeeding Business Day, except that in
the case of a Floating Rate Note as to which LIBOR is an applicable Interest Rate Basis and that
Business Day falls in the next succeeding calendar month, the particular Interest Payment Date
will be the immediately preceding Business Day. If the Maturity Date of a Floating Rate Note
falls on a day that is not a Business Day, the Trust will make the required payment of
principal, premium, if any, and interest or other amounts on the next succeeding Business Day,
and no additional interest will accrue in respect of the payment made on that next succeeding
Business Day.
(xii) Rounding. Unless otherwise specified on the face hereof, all percentages resulting
from any calculation on this Floating Rate Note will be rounded to the nearest one
hundred-thousandth of a percentage point, with five one-millionths of a percentage point rounded
upwards. All dollar amounts used in or resulting from any calculation on this Floating Rate Note
will be rounded, in the case of U.S. Dollars, to the nearest cent or, in the case of a Foreign
Currency, to the nearest unit (with one-half cent or unit being rounded upwards).
(xiii) Interest Factor. With respect to this Floating Rate Note, accrued interest is
calculated by multiplying the principal amount of such Note by an accrued interest factor. The
accrued
11
interest factor is computed by adding the interest factor calculated for each day in the
particular Interest Reset Period. The interest factor for each day will be computed by dividing
the interest rate applicable to such day by 360, in the case of a Floating Rate Note as to which
the CD Rate, the Commercial Paper Rate, the Eleventh District Cost of Funds Rate, the Federal
Funds Open Rate, the Federal Funds Rate, LIBOR, EURIBOR or the Prime Rate is an applicable
Interest Rate Basis, or by the actual number of days in the year, in the case of a Floating Rate
Note as to which the CMT Rate or the Treasury Rate is an applicable Interest Rate Basis. In the
case of a series of Notes that bear interest at floating rates as to which the Constant Maturity
Swap Rate is the Interest Rate Basis, the interest factor for each day will be computed by
dividing the number of days in the interest period by 360 (the number of days to be calculated
on the base is of a year of 360 days with twelve 30-day months (unless (i) the last day of the
interest period is the 31st day of a month but the first day of the interest period is a day
other than the 30th or 31st day of a month, in which case the month that includes that last day
shall not be considered to be shortened to a 30-day month, or (ii) the last day of the interest
period is the last day of the month of February, in which case the month of February shall not
be considered to be lengthened to a 30-day month)). The interest factor for a Floating Rate Note
as to which the interest rate is calculated with reference to two or more Interest Rate Bases
will be calculated in each period in the same manner as if only the applicable Interest Rate
Basis specified above applied.
(xiv) Determination of Interest Rate Basis. The Calculation Agent shall determine the
rate derived from each Interest Rate Basis in accordance with the following provisions.
(A) CD Rate Notes. If the Interest Rate Basis is the CD Rate, this Note shall be
deemed a βCD Rate Note.β Unless otherwise specified on the face hereof, βCD Rateβ means: (1)
the rate on the particular Interest Determination Date for negotiable United States dollar
certificates of deposit having the Index Maturity specified on the face hereof as published in
H.15(519) (as defined below) under the caption βCDs (secondary market)β; or (2) if the rate
referred to in clause (1) is not so published by 3:00 P.M., New York City time, on the related
Calculation Date, the rate on the particular Interest Determination Date for negotiable United
States dollar certificates of deposit of the particular Index Maturity as published in H.15
Daily Update (as defined below), or other recognized electronic source used for the purpose of
displaying the applicable rate, under the caption βCDs (secondary market)β; or (3) if the rate
referred to in clause (2) is not so published by 3:00 P.M., New York City time, on the related
Calculation Date, the rate on the particular Interest Determination Date calculated by the
Calculation Agent as the arithmetic mean of the secondary market offered rates as of 10:00
A.M., New York City time, on that Interest Determination Date, of three leading non-bank
dealers in negotiable United States dollar certificates of deposit in The City of New York
(which may include the purchasing agent or its affiliates) selected by the Calculation Agent
for negotiable United States dollar certificates of deposit of major United States money
market banks for negotiable United States certificates of deposit with a remaining maturity
closest to the particular Index Maturity in an amount that is representative for a single
transaction in that market at that time; or (4) if the dealers so selected by the Calculation
Agent are not quoting as mentioned in clause (3), the CD Rate in effect on the particular
Interest Determination Date. βH.15(519)β means the weekly statistical release designated as
H.15(519), or any
12
successor publication, published by the Board of Governors of the Federal Reserve System.
βH.15 Daily Updateβ means the daily update of H.15(519), available through the world-wide-web
site of the Board of Governors of the Federal Reserve System at
xxxx://xxx.xxxxxxxxxxxxxx.xxx/xxxxxxxx/X00/ update, or any successor site or publication.
(B) CMT Rate Notes. If the Interest Rate Basis is the CMT Rate, this Note shall be
deemed a βCMT Rate Note.β Unless otherwise specified on the face hereof, βCMT Rateβ means:
(1) if Reuters Page FRBCMT is specified on the face hereof:
i. | the percentage equal to the yield for United States Treasury securities at βconstant maturityβ having the Index Maturity specified on the face hereof as published in H.15(519) under the caption βTreasury Constant Maturitiesβ, as the yield is displayed on Reuters Service (or any successor service) on page FRBCMT (or any other page as may replace the specified page on that service) (βReuters Page FRBCMTβ), for the particular Interest Determination Date; or | ||
ii. | if the rate referred to in clause (i) does not so appear on Reuters Page FRBCMT, the percentage equal to the yield for United States Treasury securities at βconstant maturityβ having the particular Index Maturity and for the particular Interest Determination Date as published in H.15(519) under the caption βTreasury Constant Maturitiesβ; or | ||
iii. | if the rate referred to in clause (ii) does not so appear in H.15(519), the rate on the particular Interest Determination Date for the period of the particular Index Maturity as may then be published by either the Federal Reserve System Board of Governors or the United States Department of the Treasury that the Calculation Agent determines to be comparable to the rate which would otherwise have been published in H.15(519); or | ||
iv. | if the rate referred to in clause (iii) is not so published, the rate on the particular Interest Determination Date calculated by the Calculation Agent as a yield to maturity based on the arithmetic mean of the secondary market bid prices at approximately 3:30 P.M., New York City time, on that Interest Determination Date of three leading primary United States government securities dealers in The City of New York (which may include the purchasing agent or its affiliates) (each, a βReference Dealerβ) selected by the Calculation Agent from five Reference Dealers selected by the Calculation Agent and eliminating the highest quotation, or, in the event of equality, one of the highest, and the lowest quotation or, in the event of equality, one of the lowest, for United States Treasury securities with an original maturity equal to the particular Index Maturity, a remaining term to maturity no more than one year shorter than that Index Maturity and in a principal amount that is representative for a single transaction in the securities in that market at that time; or |
13
v. | if fewer than five but more than two of the prices referred to in clause (iv) are provided as requested, the rate on the particular Interest Determination Date calculated by the Calculation Agent based on the arithmetic mean of the bid prices obtained and neither the highest nor the lowest of the quotations shall be eliminated; or | ||
vi. | if fewer than three prices referred to in clause (iv) are provided as requested, the rate on the particular Interest Determination Date calculated by the Calculation Agent as a yield to maturity based on the arithmetic mean of the secondary market bid prices as of approximately 3:30 P.M., New York City time, on that Interest Determination Date of three Reference Dealers selected by the Calculation Agent from five Reference Dealers selected by the Calculation Agent and eliminating the highest quotation or, in the event of equality, one of the highest and the lowest quotation or, in the event of equality, one of the lowest, for United States Treasury securities with an original maturity greater than the particular Index Maturity, a remaining term to maturity closest to that Index Maturity and in a principal amount that is representative for a single transaction in the securities in that market at that time; or | ||
vii. | if fewer than five but more than two prices referred to in clause (vi) are provided as requested, the rate on the particular Interest Determination Date calculated by the Calculation Agent based on the arithmetic mean of the bid prices obtained and neither the highest nor the lowest of the quotations will be eliminated; or | ||
viii. | if fewer than three prices referred to in clause (vi) are provided as requested, the CMT Rate in effect on the particular Interest Determination Date; or |
(2) if Reuters Page FEDCMT is specified on the face hereof:
i. | the percentage equal to the one-week or one-month, as specified on the face hereof, average yield for United States Treasury securities at βconstant maturityβ having the Index Maturity specified on the face hereof as published in H.15(519) opposite the caption βTreasury Constant Maturitiesβ, as the yield is displayed on Reuters Service (or any successor service) (on page FEDCMT or any other page as may replace the specified page on that service) (βReuters Page FEDCMTβ), for the week or month, as applicable, ended immediately preceding the week or month, as applicable, in which the particular Interest Determination Date falls; or | ||
ii. | if the rate referred to in clause (i) does not so appear on Reuters Page FEDCMT, the percentage equal to the one-week or one-month, as specified on the face hereof, average yield for United States Treasury securities at βconstant maturityβ having the particular Index Maturity and for the week or |
14
month, as applicable, preceding the particular Interest Determination Date as published in H.15(519) opposite the caption βTreasury Constant Maturitiesβ; or |
iii. | if the rate referred to in clause (ii) does not so appear in H.15(519), the one-week or one-month, as specified on the face hereof, average yield for United States Treasury securities at βconstant maturityβ having the particular Index Maturity as otherwise announced by the Federal Reserve Bank of New York for the week or month, as applicable, ended immediately preceding the week or month, as applicable, in which the particular Interest Determination Date falls; or | ||
iv. | if the rate referred to in clause (iii) is not so published, the rate on the particular Interest Determination Date calculated by the Calculation Agent as a yield to maturity based on the arithmetic mean of the secondary market bid prices at approximately 3:30 P.M., New York City time, on that Interest Determination Date of three Reference Dealers selected by the Calculation Agent from five Reference Dealers selected by the Calculation Agent and eliminating the highest quotation, or, in the event of equality, one of the highest, and the lowest quotation or, in the event of equality, one of the lowest, for United States Treasury securities with an original maturity equal to the particular Index Maturity, a remaining term to maturity no more than one year shorter than that Index Maturity and in a principal amount that is representative for a single transaction in the securities in that market at that time; or | ||
v. | if fewer than five but more than two of the prices referred to in clause (iv) are provided as requested, the rate on the particular Interest Determination Date calculated by the Calculation Agent based on the arithmetic mean of the bid prices obtained and neither the highest nor the lowest of the quotations shall be eliminated; or | ||
vi. | if fewer than three prices referred to in clause (iv) are provided as requested, the rate on the particular Interest Determination Date calculated by the Calculation Agent as a yield to maturity based on the arithmetic mean of the secondary market bid prices as of approximately 3:30 P.M., New York City time, on that Interest Determination Date of three Reference Dealers selected by the Calculation Agent from five Reference Dealers selected by the Calculation Agent and eliminating the highest quotation or, in the event of equality, one of the highest and the lowest quotation or, in the event of equality, one of the lowest, for United States Treasury securities with an original maturity greater than the particular Index Maturity, a remaining term to maturity closest to that Index Maturity and in a principal amount that is representative for a single transaction in the securities in that market at the time; or |
15
vii. | if fewer than five but more than two prices referred to in clause (vi) are provided as requested, the rate on the particular Interest Determination Date calculated by the Calculation Agent based on the arithmetic mean of the bid prices obtained and neither the highest nor the lowest of the quotations will be eliminated; or | ||
viii. | if fewer than three prices referred to in clause (vi) are provided as requested, the CMT Rate in effect on that Interest Determination Date. |
If two United States Treasury securities with an original maturity greater than the Index
Maturity specified on the face hereof have remaining terms to maturity equally close to the
particular Index Maturity, the quotes for the United States Treasury security with the
shorter original remaining term to maturity will be used.
(C) Commercial Paper Rate Notes. If the Interest Rate Basis is the Commercial Paper
Rate, this Note shall be deemed a βCommercial Paper Rate Note.β Unless otherwise specified on
the face hereof, βCommercial Paper Rateβ means: (1) the Money Market Yield (as defined below)
on the particular Interest Determination Date of the rate for commercial paper having the
Index Maturity specified on the face hereof as published in H.15(519) under the caption
βCommercial PaperβNonfinancialβ; or (2) if the rate referred to in clause (1) is not so
published by 3:00 P.M., New York City time, on the related Calculation Date, the Money Market
Yield of the rate on the particular Interest Determination Date for commercial paper having
the particular Index Maturity as published in H.15 Daily Update, or such other recognized
electronic source used for the purpose of displaying the applicable rate, under the caption
βCommercial PaperβNonfinancialβ; or (3) if the rate referred to in clause (2) is not so
published by 3:00 P.M., New York City time, on the related Calculation Date, the rate on the
particular Interest Determination Date calculated by the Calculation Agent as the Money Market
Yield of the arithmetic mean of the offered rates at approximately 11:00 A.M., New York City
time, on that Interest Determination Date of three leading dealers of United States dollar
commercial paper in The City of New York (which may include the purchasing agent or its
affiliates) selected by the Calculation Agent for commercial paper having the particular Index
Maturity placed for industrial issuers whose bond rating is βAaβ, or the equivalent, from a
nationally recognized statistical rating organization; or (4) if the dealers so selected by
the Calculation Agent are not quoting as mentioned in clause (3), the Commercial Paper Rate in
effect on the particular Interest Determination Date. βMoney Market Yieldβ means a yield
(expressed as a percentage) calculated in accordance with the following formula:
Money Market Yield = | D x 360 | x 100 | ||
360 β (D x M) |
where βDβ refers to the applicable per annum rate for commercial paper quoted on a bank
discount basis and expressed as a decimal, and βMβ refers to the actual number of days in the
applicable Interest Reset Period.
16
(D) Constant Maturity Swap Rate Notes. If the Interest Rate Basis is the Constant
Maturity Swap Rate, this Note shall be deemed a βConstant Maturity Swap Rate Note.β Unless
otherwise specified on the face hereof, βConstant Maturity Swap Rateβ means: (1) the rate for
U.S. dollar swaps with the designated maturity specified on the face hereof, expressed as a
percentage, which appears on the Reuters Screen (or any successor service) TGM42276 Page as of
11:00 A.M., New York City time, on the particular Interest Determination Date; or (2) if the
rate referred to in clause (1) does not appear on the Reuters Screen (or any successor
service) TGM42276 Page by 2:00 P.M., New York City time, on such Interest Determination Date,
a percentage determined on the basis of the mid-market semiannual swap rate quotations
provided by the reference banks (as defined below) as of approximately 11:00 A.M., New York
City time, on such Interest Determination Date, and, for this purpose, the semi-annual swap
rate means the mean of the bid and offered rates for the semi-annual fixed leg, calculated on
a 30/360 day count basis, of a fixed-for-floating U.S. dollar interest rate swap transaction
with a term equal to the designated maturity specified on the face hereof commencing on the
Interest Reset Date and in a representative amount (as defined below) with an acknowledged
dealer of good credit in the swap market, where the floating leg, calculated on an actual/360
day count basis, is equivalent to USD-LIBOR-BBA with a designated maturity specified on the
face hereof. The Calculation Agent will request the principal New York City office of each of
the reference banks to provide a quotation of its rate. If at least three quotations are
provided, the rate for that Interest Determination Date will be the arithmetic mean of the
quotations, eliminating the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality, one of the lowest); or (3) if
at least three quotations are not received by the Calculation Agent as mentioned in clause
(2), the Constant Maturity Swap Rate in effect on the particular Interest Determination Date.
βU.S. Government Securities business dayβ means any day except for Saturday, Sunday, or a day
on which The Bond Market Association recommends that the fixed income departments of its
members be closed for the entire day for purposes of trading in U.S. government securities.
βRepresentative amountβ means an amount that is representative for a single transaction in the
relevant market at the relevant time. βReference banksβ mean five leading swap dealers in the
New York City interbank market, selected by the Calculation Agent, after consultation with us.
(E) Eleventh District Cost of Funds Rate Notes. If the Interest Rate Basis is the
Eleventh District Cost of Funds Rate, this Note shall be deemed an βEleventh District Cost of
Funds Rate Note.β Unless otherwise specified on the face hereof, βEleventh District Cost of
Funds Rateβ means: (1) the rate equal to the monthly weighted average cost of funds for the
calendar month immediately preceding the month in which the particular Interest Determination
Date falls as set forth under the caption β11th Districtβ on the display on Reuters Service
(or any successor service) on Page COFI/ARMS (or any other page as may replace the specified
page on that service) (βReuters Page COFI/ARMSβ) as of 11:00 A.M., San Francisco time, on that
Interest Determination Date; or (2) if the rate referred to in clause (1) does not so appear
on Reuters Page COFI/ARMS, the monthly weighted average cost of funds paid by member
institutions of the Eleventh Federal Home Loan Bank District that was most recently announced
(the βEleventh District Indexβ) by the Federal Home Loan Bank of San Francisco as the cost of
funds for the calendar month
17
immediately preceding that Interest Determination Date; or (3) if the Federal Home Loan Bank
of San Francisco fails to announce the Eleventh District Index on or prior to the particular
Interest Determination Date for the calendar month immediately preceding that Interest
Determination Date, the Eleventh District Cost of Funds Rate in effect on the particular
Interest Determination Date.
(F) EURIBOR Notes. If the Interest Rate Basis is EURIBOR, this Note shall be deemed a
βEURIBOR Note.β Unless otherwise specified on the face hereof, βEURIBORβ means: (1) with
respect to any Interest Determination Date relating to this EURIBOR Note (a βEURIBOR Interest
Determination Dateβ), the rate for deposits in euros as sponsored, calculated and published
jointly by the European Banking Federation and ACI β The Financial Market Association, or any
company established by the joint sponsors for purposes of compiling and publishing those
rates, having the Index Maturity specified on the face hereof, commencing on the applicable
Interest Reset Date, as the rate appears on Reuters Service (or any successor service), on
page EURIBOR 01 (or any other page as may replace that specified page on the service)
(βReuters Page EURIBOR 01β) as of 11:00 A.M., Brussels time, on the applicable EURIBOR
Interest Determination Date; or (2) if such rate does not appear on Reuters Page EURIBOR 01,
or is not so published by 11:00 A.M., Brussels time, on the applicable EURIBOR Interest
Determination Date, such rate will be calculated by the Calculation Agent and will be the
arithmetic mean of at least two quotations obtained by the Calculation Agent after requesting
the principal Euro-zone (as defined below) offices of four major banks in the Euro-zone
interbank market to provide the Calculation Agent with its offered quotation for deposits in
euros for the period of the Index Maturity specified on the face hereof, commencing on the
applicable Interest Reset Date, to prime banks in the Euro-zone interbank market at
approximately 11:00 A.M., Brussels time, on the applicable EURIBOR Interest Determination Date
and in a principal amount not less than the equivalent of $1 million in euros that is
representative for a single transaction in euro in the market at that time; or (3) if fewer
than two such quotations are so provided, the rate on the applicable EURIBOR Interest
Determination Date will be calculated by the Calculation Agent and will be the arithmetic mean
of the rates quoted at approximately 11:00 A.M., Brussels time, on such EURIBOR Interest
Determination Date by four major banks in the Euro-zone for loans in euro to leading European
banks, having the Index Maturity specified on the face hereof, commencing on the applicable
Interest Reset Date and in a principal amount not less than the equivalent of $1 million in
euros that is representative for a single transaction in euros in the market at that time; or
(4) if the banks so selected by the Calculation Agent are not quoting as mentioned above,
EURIBOR will be EURIBOR in effect on the applicable EURIBOR Interest Determination Date.
βEuro-zoneβ means the region comprised of member states of the European Union that have
adopted the single currency in accordance with the treaty establishing the European Community,
as amended by the treaty on European Union.
(G) Federal Funds Open Rate Notes. If the Interest Rate Basis is the Federal Funds
Open Rate, this Note shall be deemed a βFederal Funds Open Rate Note.β Unless otherwise
specified on the face hereof, βFederal Funds Open Rateβ means the rate set forth on Reuters on
page 5 (or any other page as may replace the specified page on that service) for an Interest
Determination Date underneath the caption βFEDERAL FUNDSβ in the row
18
titled βOPENβ. If the rate is not available for an Interest Determination Date, the rate for
that Interest Determination Date shall be the Federal Funds Rate as determined below.
(H) Federal Funds Rate Notes. If the Interest Rate Basis is the Federal Funds Rate,
this Note shall be deemed a βFederal Funds Rate Note.β Unless otherwise specified on the face
hereof, βFederal Funds Rateβ means: (1) the rate as of the particular Interest Determination
Date for United States dollar federal funds as published in H.15(519) under the caption
βFederal Funds (Effective)β and displayed on Reuters on page FEDFUNDS1 (or any other page as
may replace the specified page on that service) (βReuters Page FEDFUNDS1β); or (2) if the rate
referred to in clause (1) does not so appear on Reuters Page FEDFUNDS1 or is not so published
by 5:00 P.M., New York City time, on the related Calculation Date, the rate on the particular
Interest Determination Date for United States dollar federal funds as published in H.15 Daily
Update, or such other recognized electronic source used for the purpose of displaying the
applicable rate, under the caption βFederal Funds (Effective)β; or (3) if such rate does not
appear on Reuters Page FEDFUNDS1 or is not so published by 5:00 P.M., New York City time, on
the related Calculation Date, the rate will be the rate for the first preceding day for which
such rate is set forth in H.15(519) under the caption βFederal Funds (Effective)β, as such
rate is displayed on the Reuters Page FEDFUNDS1.
(I) LIBOR Notes. If the Interest Rate Basis is LIBOR, this Note shall be deemed a
βLIBOR Note.β Unless otherwise specified on the face hereof, βLIBORβ means: (1) whether βLIBOR
Reutersβ is or is not specified on the face hereof as the method for calculating LIBOR, the
rate for deposits in the LIBOR Currency (as defined below) having the Index Maturity specified
on the face hereof, commencing on the related Interest Reset Date, that appears on the LIBOR
Page (as defined below) as of 11:00 A.M., London time, on the particular Interest
Determination Date; or (2) if no rate appears on the particular Interest Determination Date on
the LIBOR Page as specified in clause (1), the rate calculated by the Calculation Agent as the
arithmetic mean of at least two offered quotations obtained by the Calculation Agent after
requesting the principal London offices of each of four major reference banks (which may
include affiliates of the Agents), in the London interbank market selected by the Calculation
Agent to provide the Calculation Agent with its offered quotation for deposits in the LIBOR
Currency for the period of the particular Index Maturity, commencing on the related Interest
Reset Date, to prime banks in the London interbank market at approximately 11:00 A.M., London
time, on that Interest Determination Date and in a principal amount that is representative for
a single transaction in the LIBOR Currency in that market at that time; or (3) if fewer than
two offered quotations referred to in clause (2) are provided as requested, the rate
calculated by the Calculation Agent as the arithmetic mean of the rates quoted at
approximately 11:00 A.M., in the applicable Principal Financial Center, on the particular
Interest Determination Date by three major banks (which may include affiliates of the Agents),
in that principal financial center selected by the Calculation Agent for loans in the LIBOR
Currency to leading European banks, having the particular Index Maturity and in a principal
amount that is representative for a single transaction in the LIBOR Currency in that market at
that time; or (4) if the banks so selected by the Calculation Agent are not quoting as
mentioned in clause (3), LIBOR in effect on the particular Interest Determination Date. βLIBOR
Currencyβ means the currency specified on the face hereof as to which LIBOR shall be
19
calculated or, if no currency is specified on the face hereof, United States dollars. βLIBOR
Pageβ means the display on Reuters Service (or any successor service) on the page specified on
the face hereof (or any other page as may replace that page on that service) for the purpose
of displaying the London interbank rates of major banks for the LIBOR Currency.
(J) Prime Rate Notes. If the Interest Rate Basis is the Prime Rate, this Note shall be
deemed a βPrime Rate Note.β Unless otherwise specified on the face hereof, βPrime Rateβ means:
(1) the rate on the particular Interest Determination Date as published in H.15(519) under the
caption βBank Prime Loanβ; or (2) if the rate referred to in clause (1) is not so published by
3:00 P.M., New York City time, on the related Calculation Date, the rate on the particular
Interest Determination Date as published in H.15 Daily Update, or such other recognized
electronic source used for the purpose of displaying the applicable rate, under the caption
βBank Prime Loanβ, or (3) if the rate referred to in clause (2) is not so published by 3:00
P.M., New York City time, on the related Calculation Date, the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the arithmetic mean of the rates of
interest publicly announced by each bank that appears on the Reuters Screen US PRIME 1 Page
(as defined below) as the applicable bankβs prime rate or base lending rate as of 11:00 A.M.,
New York City time, on that Interest Determination Date; or (4) if fewer than four rates
referred to in clause (3) are so published by 3:00 p.m., New York City time, on the related
Calculation Date, the rate calculated by the Calculation Agent as the particular Interest
Determination Date calculated by the Calculation Agent as the arithmetic mean of the prime
rates or base lending rates quoted on the basis of the actual number of days in the year
divided by a 360-day year as of the close of business on that Interest Determination Date by
three major banks (which may include affiliates of the purchasing agent) in The City of New
York selected by the Calculation Agent; or (5) if the banks so selected by the Calculation
Agent are not quoting as mentioned in clause (4), the Prime Rate in effect on the particular
Interest Determination Date. βReuters Screen US PRIME 1 Pageβ means the display on the Reuters
Monitor Money Rates Service (or any successor service) on the βUS PRIME 1β page (or any other
page as may replace that page on that service) for the purpose of displaying prime rates or
base lending rates of major United States banks.
(K) Treasury Rate Notes. If the Interest Rate Basis is the Treasury Rate, this Note
shall be deemed a βTreasury Rate Note.β Unless otherwise specified on the face hereof,
βTreasury Rateβ means: (1) the rate from the auction held on the Interest Determination Date
(the βAuctionβ) of direct obligations of the United States (βTreasury Billsβ) having the Index
Maturity specified on the face hereof under the caption βINVESTMENT RATEβ on the display on
Reuters Service (or any successor service) on page USAUCTION 10 (or any other page as may
replace that page on that service) (βReuters USAUCTION 10β) or page USAUCTION 11 (or any other
page as may replace that page on that service) (βReuters USAUCTION 11β); or (2) if the rate
referred to in clause (1) is not so published by 3:00 P.M., New York City time, on the related
Calculation Date, the Bond Equivalent Yield (as defined below) of the rate for the applicable
Treasury Bills as published in H.15 Daily Update, or another recognized electronic source used
for the purpose of displaying the applicable rate, under the caption βU.S. Government
Securities/Treasury Bills/Auction
20
Highβ; or (3) if the rate referred to in clause (2) is not so published by 3:00 P.M., New York
City time, on the related Calculation Date, the Bond Equivalent Yield of the auction rate of
the applicable Treasury Bills as announced by the United States Department of the Treasury; or
(4) if the rate referred to in clause (3) is not so announced by the United States Department
of the Treasury, or if the Auction is not held, the Bond Equivalent Yield of the rate on the
particular Interest Determination Date of the applicable Treasury Bills as published in
H.15(519) under the caption βU.S. Government Securities/Treasury Bills/Secondary Marketβ; or
(5) if the rate referred to in clause (4) is not so published by 3:00 P.M., New York City
time, on the related Calculation Date, the rate on the particular Interest Determination Date
of the applicable Treasury Bills as published in H.15 Daily Update, or another recognized
electronic source used for the purpose of displaying the applicable rate, under the caption
βU.S. Government Securities/Treasury Bills/Secondary Marketβ; or (6) if the rate referred to
in clause (5) is not so published by 3:00 P.M., New York City time, on the related Calculation
Date, the rate on the particular Interest Determination Date calculated by the Calculation
Agent as the Bond Equivalent Yield of the arithmetic mean of the secondary market bid rates,
as of approximately 3:30 P.M., New York City time, on that Interest Determination Date, of
three primary United States government securities dealers (which may include the purchasing
agent or its affiliates) selected by the Calculation Agent, for the issue of Treasury Bills
with a remaining maturity closest to the Index Maturity specified on the face hereof; or (7)
if the dealers so selected by the Calculation Agent are not quoting as mentioned in clause
(6), the Treasury Rate in effect on the particular Interest Determination Date. βBond
Equivalent Yieldβ means a yield (expressed as a percentage) calculated in accordance with the
following formula:
Bond Equivalent Yield = | D x N | x 100 | ||
360 β (D x M) |
where βDβ refers to the applicable per annum rate for Treasury Bills quoted on a bank discount
basis and expressed as a decimal, βNβ refers to 365 or 366, as the case may be, and βMβ refers
to the actual number of days in the applicable Interest Reset Period.
(c) Discount Notes. If this Note is specified on the face hereof as a βDiscount Noteβ:
(i) Principal and Interest. This Note will bear interest in the same manner as set
forth in Section 3(a) above, and payments of principal and interest shall be made as set
forth on the face hereof. Discount Notes may not bear any interest currently or may bear
interest at a rate that is below market rates at the time of issuance. The difference
between the Issue Price of a Discount Note and par is referred to as the βDiscountβ.
(ii) Redemption; Repayment; Acceleration. In the event a Discount Note is redeemed,
repaid or accelerated, the amount payable to the Holder of such Discount Note will be equal
to the sum of: (A) the Issue Price (increased by any accruals of Discount) and, in the event
of any redemption of such Discount Note, if applicable, multiplied by the Initial Redemption
Percentage (as adjusted by the Annual Redemption Percentage Reduction, if applicable); and
(B) any unpaid interest accrued on such Discount Note to the Maturity Date (βAmortized Face
Amountβ). Unless otherwise specified on the face hereof, for
21
purposes of determining the amount of Discount that has accrued as of any date on which a
redemption, repayment or acceleration of maturity occurs for a Discount Note, a Discount
will be accrued using a constant yield method. The constant yield will be calculated using a
30-day month, 360-day year convention, a compounding period that, except for the Initial
Period (as defined below), corresponds to the shortest period between Interest Payment Dates
for the applicable Discount Note (with ratable accruals within a compounding period), a
coupon rate equal to the initial coupon rate applicable to the applicable Discount Note and
an assumption that the maturity of such Discount Note will not be accelerated. If the period
from the date of issue to the first Interest Payment Date for a Discount Note (the βInitial
Periodβ) is shorter than the compounding period for such Discount Note, a proportionate
amount of the yield for an entire compounding period will be accrued. If the Initial Period
is longer than the compounding period, then the period will be divided into a regular
compounding period and a short period with the short period being treated as provided above.
(d) Amortizing Notes. If this Note is specified on the face hereof as an βAmortizing
Noteβ, this Note will bear interest in the same manner as set forth in Section 3(a) above, and
payments on principal, premium, if any, and interest will be made as set forth on the face hereof
and/or in accordance with Schedule I attached hereto. The Trust will make payments combining
principal, premium (if any) and interest, if applicable, on the dates and in the amounts set forth
in the table appearing in Schedule I, attached to this Note or in accordance with the
formula specified on the face hereof. Payments made hereon will be applied first to interest due
and payable hereon and then to the reduction of the unpaid principal amount hereof.
Section 4. Redemption. If no redemption right is set forth on the face hereof, this Note
may not be redeemed prior to the Stated Maturity Date, except as set forth in the Indenture or in
Section 10 hereof. In the case of a Note that is not a Discount Note, if a redemption right is set
forth on the face of this Note, the Trust shall elect to redeem this Note on the Interest Payment
Date after the Initial Redemption Date set forth on the face hereof on which the Funding Agreement
is to be redeemed in whole or in part by Principal Life Insurance Company (βPrincipal Lifeβ) (each,
a βRedemption Dateβ), in which case this Note must be redeemed on such Redemption Date in whole or
in part, as applicable, prior to the Stated Maturity Date, in increments of $1,000 at the
applicable Redemption Price (as defined below), together with unpaid interest, if any, accrued
thereon to, but excluding, the applicable Redemption Date. βRedemption Priceβ shall mean an amount
equal to the Initial Redemption Percentage (as adjusted by the Annual Redemption Percentage
Reduction, if applicable) multiplied by the unpaid Principal Amount of this Note to be redeemed.
The unpaid Principal Amount of this Note to be redeemed shall be determined by multiplying (1) the
Outstanding Principal Amount of this Note by (2) the quotient derived by dividing (A) the
outstanding principal amount of the Funding Agreement to be redeemed by Principal Life by (B) the
outstanding principal amount of the Funding Agreement. The Initial Redemption Percentage, if any,
applicable to this Note shall decline at each anniversary of the Initial Redemption Date by an
amount equal to the applicable Annual Redemption Percentage Reduction, if any, until the Redemption
Price is equal to 100% of the unpaid amount thereof to be redeemed. Notice must be given not more
than sixty (60) nor less than thirty (30) calendar days prior to the proposed Redemption Date. In
the event of redemption of this Note in part only, a new Note for the unredeemed portion hereof
shall be issued in the name of the Holder hereof
22
upon the surrender hereof. If less than all of this Note is redeemed, the Indenture Trustee will
select by lot or, in its discretion, on a pro rata basis, the amount of the interest of each direct
participant in the Trust to be redeemed.
Section 5. Sinking Funds and Amortizing Notes. Unless specified on the face hereof, this
Note will not be subject to, or entitled to the benefit of, any sinking fund. If this Note is an
Amortizing Note, this Note may pay an amount in respect of both interest and principal amortized
over the life of this Note.
Section 6. Repayment. If no repayment right is set forth on the face hereof, this Note may
not be repaid at the option of the Holder hereof prior to the Stated Maturity Date. If a repayment
right is granted on the face of this Note, this Note may be subject to repayment at the option of
the Holder on any Interest Payment Date on and after the date, if any, indicated on the face hereof
(each, a βRepayment Dateβ). On any Repayment Date, unless otherwise specified on the face hereof,
this Note shall be repayable in whole or in part in increments of $1,000 at the option of the
Holder hereof at a repayment price equal to 100% of the Principal Amount to be repaid, together
with interest thereon payable to the Repayment Date. For this Note to be repaid in whole or in part
at the option of the Holder hereof, this Note must be received by the Indenture Trustee, with the
form entitled βOption to Elect Repaymentβ, below, duly completed by the Indenture Trustee. Exercise
of such repayment option by the Holder hereof shall be irrevocable. In the event of a repayment of
this Note in part only, a new Note for the portion hereof not repaid shall be issued in the name of
the Holder hereof upon the surrender hereof.
23
Section 7. Modifications and Waivers. The Indenture contains provisions permitting the
Trust and the Indenture Trustee (1) at any time and from time to time without notice to, or the
consent of, the Holders of any Notes issued under the Indenture to enter into one or more
supplemental indentures for certain enumerated purposes and (2) with the consent of the Holders of
a majority in aggregate principal amount of the Outstanding Notes affected thereby, to enter into
one or more supplemental indentures for the purpose of adding any provisions to, or changing in any
manner or eliminating any of the provisions of, the Indenture or of modifying in any manner the
rights of Holders of Notes under the Indenture; provided, that, with respect to certain enumerated
provisions, no such supplemental indenture shall be entered into without the consent of the Holder
of each Note affected thereby. Any such consent or waiver by the Holder of this Note shall be
conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note
issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or
not notation of such consent or waiver is made upon this Note or such other Notes.
Section 8. Obligations Unconditional. No reference herein to the Indenture and no
provisions of this Note or of the Indenture shall impair the right of each Holder of any Note,
which is absolute and unconditional, to receive payment of the principal of, and any interest on,
and premium, if any, on, such Note on the respective Stated Maturity Date or redemption date
thereof and to institute suit for the enforcement of any such payment, and such rights shall not be
impaired without the consent of such Holder.
Section 9. Events of Default. If an Event of Default with respect to this Note shall occur
and be continuing, the principal of, and all other amounts payable on, the Notes may be declared
due and payable, or may be automatically accelerated, as the case may be, in the manner and with
the effect provided in the Indenture. In the event that this Note is a Discount Note, the amount of
principal of this Note that becomes due and payable upon such acceleration shall be equal to the
amount calculated as set forth in Section 3(c) hereof.
Section 10. Withholding; No Additional Amounts; Tax Event and Redemption. All amounts due
on this Note will be made without any applicable withholding or deduction for or on account of any
present or future taxes, duties, levies, assessments or other governmental charges of whatever
nature imposed or levied by or on behalf of any governmental authority, unless such withholding or
deduction is required by law. Unless otherwise specified on the face hereof, the Trust will not pay
any additional amounts to the Holder of this Note in respect of such withholding or deduction, any
such withholding or deduction will not give rise to an event of default or any independent right or
obligation to redeem this Note and the Holder will be deemed for all purposes to have received cash
in an amount equal to the portion of such withholding or deduction that is attributable to such
Holderβs interest in this Note as equitably determined by the Trust.
If (1) a Tax Event (defined below) as to the Funding Agreement occurs and (2) Principal Life
redeems the Funding Agreement in whole or in part, the Trust will redeem the Notes, subject to the
terms and conditions of Section 2.04 of the Standard Indenture Terms, at the Tax Event
Redemption Price (defined below) together with unpaid interest accrued thereon to the applicable
redemption date. βTax Eventβ means that Principal Life shall have received an opinion of
independent legal counsel stating in effect that as a result of (a) any amendment to, or change
24
(including any announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or therein or (b) any
amendment to, or change in, an interpretation or application of any such laws or regulations by any
governmental authority in the United States, which amendment or change is enacted, promulgated,
issued or announced on or after the effective date of the Funding Agreement, there is more than an
insubstantial risk that (i) the Trust is, or will be within ninety (90) days of the date thereof,
subject to U.S. federal income tax with respect to interest accrued or received on the Funding
Agreement or (ii) the Trust is, or will be within ninety (90) days of the date thereof, subject to
more than a de minimis amount of taxes, duties or other governmental charges. βTax Event Redemption
Priceβ means an amount equal to the unpaid principal amount of this Note to be redeemed, which
shall be determined by multiplying (1) the Outstanding Principal Amount of this Note by (2) the
quotient derived by dividing (A) the outstanding principal amount to be redeemed by Principal Life
of the Funding Agreement by (B) the outstanding principal amount of the Funding Agreement.
Section 11. Listing. Unless otherwise specified on the face hereof, this Note will not be
listed on any securities exchange.
Section 12. Collateral. The Collateral for this Note includes the Funding Agreement and the
Guarantee specified on the face hereof.
Section 13. No Recourse Against Certain Persons. No recourse shall be had for the payment
of any principal, interest or any other sums at any time owing under the terms of this Note, or for
any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Indenture
or any indenture supplemental thereto, against the Nonrecourse Parties, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise, all such personal liability being, by the acceptance hereof and as part of the
consideration for issue hereof, expressly waived and released.
Section 14. Miscellaneous.
(a) This Note is issuable only as a registered Note without coupons in denominations of $1,000
and any integral multiple in excess thereof unless otherwise specified on the face of this Note.
(b) Prior to due presentment for registration of transfer of this Note, the Trust, the
Indenture Trustee, the Registrar, the Paying Agent, any Agent, and any other agent of the Trust or
the Indenture Trustee may treat the Person in whose name this Note is registered as the owner
hereof for the purpose of receiving payment as herein provided and for all other purposes, whether
or not this Note shall be overdue, and none of the Trust, the Indenture Trustee, the Registrar, the
Paying Agent, any Agent, or any other agent of the Trust or the Indenture Trustee shall be affected
by notice to the contrary.
(c) The Notes are being issued by means of a book-entry-only system with no physical
distribution of certificates to be made except as provided in the Indenture. The book-entry system
maintained by DTC will evidence ownership of the Notes, with transfers of ownership
25
effected on the records of DTC and its participants pursuant to rules and procedures
established by DTC and its participants. The Trust and the Indenture Trustee will recognize Cede &
Co., as nominee of DTC, as the registered owner of the Notes, as the Holder of the Notes for all
purposes, including payment of principal, premium (if any) and interest, notices and voting.
Transfer of principal, premium (if any) and interest to participants of DTC will be the
responsibility of DTC, and transfer of principal, premium (if any) and interest to beneficial
holders of the Notes by participants of DTC will be the responsibility of such participants and
other nominees of such beneficial holders. So long as the book-entry system is in effect, the
selection of any Notes to be redeemed or repaid will be determined by DTC pursuant to rules and
procedures established by DTC and its participants. Neither the Trust nor the Indenture Trustee
shall be responsible or liable for such transfers or payments or for maintaining, supervising or
reviewing the records maintained by DTC, its participants or persons acting through such
participants.
(d) This Note or portion hereof may not be exchanged for Definitive Notes, except in the
limited circumstances provided for in the Indenture. The transfer or exchange of Definitive Notes
shall be subject to the terms of the Indenture. No service charge will be made for any registration
of transfer or exchange, but the Trust may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection therewith.
Section 15. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.
26
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instruct(s) the Trust to repay this Note (or
portion hereof specified below) pursuant to its terms at a price equal to the Principal Amount
hereof together with interest to the repayment date, to the undersigned, at:
(Please print or typewrite name and address of the undersigned).
For this Note to be repaid, the Indenture Trustee (or the Paying Agent on behalf of the
Indenture Trustee) must receive at its Corporate Trust Office, or at such other place or places of
which the Trust shall from time to time notify the Holder of this Note, not more than sixty (60)
nor less than thirty (30) days prior to a Repayment Date, if any, shown on the face of this Note,
this Note with this βOption to Elect Repaymentβ form duly completed.
If less than the entire Principal Amount of this Note is to be repaid, specify the portion
hereof (which shall be in increments of $1,000) which the Holder elects to have repaid and specify
the denomination or denominations (which shall be $_________or an
integral multiple of $1,000 in excess of $_________) of the Notes to be
issued to the Holder for the portion of this Note not being repaid (in the absence of any such
specification, one such Note will be issued for the portion not being repaid).
$ |
||||||||||||
DATE: |
||||||||||||
NOTICE: The signature on this Option to Elect Repayment must correspond with the name as written upon the face of this Note in every particular, without alteration or enlargement or any change whatever. | ||||||||||||
Principal Amount to be repaid, if amount to be repaid is less than
the Principal Amount of this Note (Principal Amount remaining must
be an authorized denomination)
|
Fill in for registration of Notes if to be issued otherwise than to the registered Holder: | |||||||||||
$ |
Name: | |||||||||||
Address: | ||||||||||||
(Please print name and address including zip code) |
SOCIAL SECURITY OR OTHER TAXPAYER ID NUMBER: ___________________
27
SCHEDULE I
Amortization Table or Formula
Not applicable.
28
SCHEDULE II
SPREAD:
The Spread for this Note for the indicated periods is as follows:
Period | Spread | |||
From and including the Original Issue Date to but excluding the Interest Payment Date occurring in April 2009
|
0.25 | % | ||
From and including the Interest Payment Date occurring in April 2009 to but excluding the Final Maturity Date |
0.30 | % | ||
This Note will mature on the Initial Maturity Date, unless the maturity of all or a portion of
the Principal Amount of this Note is extended in accordance with the procedures described below.
In no event shall the maturity of this Note be extended beyond the Final Maturity Date.
During a notice period relating to an Election Date (as defined below), the holder of this
Note may elect to extend the maturity of all or any portion of the Principal Amount of this Note
(in Authorized Denominations) so that the maturity of this Note will be extended to the
Corresponding Maturity Date (as defined below) for the immediately following Election Date;
provided, however, that if such Corresponding Maturity Date is not a Business Day, the maturity of
this Note will be the immediately preceding Business Day. The Election Dates will take place
monthly on the 9th day of each month, commencing on April 9, 2008 and ending on March 9,
2009, except that if any Election Date would otherwise be a day that is not a Business Day, the
notice period (described below) will be extended until 12:00 Noon, New York City time, on the first
Business Day following the applicable Election Date, at which time such notice will be irrevocable.
The respective Corresponding Maturity Date for each Election Date is the 9th day of the
calendar month which is one calendar month after (1) April 9, 2009 (in the case of an initial
extension of maturity) or (2) any later date to which the maturity date of this Note has previously
been extended; provided, that such maturity date shall be March 19, 2010 in respect of an election
to extend on March 9, 2009 (the βCorresponding Maturity Dateβ). If the holder of this Note fails
to make an effective election to extend the maturity of all or a portion of the Principal Amount of
this Note, the maturity date of this Note (or such portion hereof) will be the Corresponding
Maturity Date for the immediately preceding Election Date. For example, assuming the holder of
this Note has previously made an election to extend the maturity date to May 9, 2009, if the holder
of this Note fails to make an effective election to extend the maturity of all or a portion of the
Principal Amount of this Note on the Election Date occurring in May 2008, this Note (or such
portion hereof) will mature on May 9, 2009. If the holder of this Note elects to extend the
maturity of a portion of this Note on the Election Date occurring in May 2008, such portion of this
Note will then be scheduled to mature on June 9, 2009.
To make an effective election on any Election Date, the holder of this Note must deliver a
notice of election substantially in the form attached hereto as Exhibit A (each, an
βElection
29
Noticeβ) and surrender this Note, if required by the Election Notice, during the notice period for
such Election Date. The notice period for an Election Date begins on the 5th Business
Day immediately preceding the relevant Election Date and ends on the relevant Election Date
provided that such Election Date is a Business Day. The Paying Agent must receive the holderβs
Election Notice through the normal clearing system channels (described in more detail below), no
later than 12:00 Noon, New York City time, on the last Business Day in the notice period (i.e. the
relevant Election Date or, if the Election Date is not a Business Day, 12:00 Noon, New York City
time, on the first Business Day following such Election Date), at which time such Election Notice
becomes irrevocable.
If, with respect to any Election Date, the holder of this Note does not make an election to
extend the maturity of all or a portion of the Principal Amount of this Note, the Principal Amount
of this Note (or such portion hereof) that has not been extended will become due and payable on the
earlier of the Initial Maturity Date or such later Corresponding Maturity Date related to the
relevant Election Date on which the Principal Amount of this Note (or such portion hereof) was not
extended. The Principal Amount of this Note (or such portion hereof) for which such election is
not exercised will be represented by a new Note substantially in the form attached hereto as
Exhibit B (each, a βShort-Term Noteβ) issued as of such Election Date and Schedule
A hereto shall be annotated as of such Election Date to reflect the corresponding decrease in
the Principal Amount hereof. The new Note so issued will have the same terms as this Note, except
that it will not be extendible, will have a separate CUSIP number, and its maturity date will be
the earlier of the Initial Maturity Date or such later Corresponding Maturity Date to which this
Note was previously extended. The failure to elect to extend the maturity of all or any portion of
this Note will be irrevocable and will be binding upon any subsequent holder of this Note.
This Note will be issued in registered global form and remain on deposit with The Depository
Trust Company, the depositary for this Note. Therefore, a holder must exercise the option to
extend the maturity of all or a portion of this Note through the depositary. To ensure that the
depositary receives timely notice of an election to extend the maturity of all or a portion of this
Note by a holder so that the depositary can deliver notice of such election to the Indenture
Trustee, as paying agent, prior to 12:00 Noon, New York City time, on the last Business Day in the
notice period, the holder of this Note must instruct the direct or indirect participant through
which it holds an interest in this Note in accordance with the then applicable operating procedures
of the depositary.
The depositary must receive any notice of election from its participants no later than 12:00
Noon, New York City time, on any Election Date, provided that such Election Date is a Business Day,
for the depositary to deliver timely notice of the election by a holder to the Indenture Trustee,
as paying agent. If the applicable Election Date is not a Business Day, the depositary must
receive notice of election from its participants no later than 10:00 A.M., New York City time, on
the first Business Day following such Election Date, for the depositary to deliver timely notice of
the election by a holder to the Indenture Trustee, as paying agent. Different firms have different
deadlines for accepting instructions from their customers. The holder of this Note should consult
the direct or indirect participant through which it holds an
30
interest in this Note to ascertain the deadline for ensuring that timely notice will be delivered
to the depositary.
31
SCHEDULE A
The initial aggregate Principal Amount of the Note evidenced by the Certificate to which
this Schedule is attached is $200,000,000. The notations on the following table evidence
decreases in the aggregate Principal Amount of the Note evidenced by such Certificate:
Election Date
|
Decreases in Principal Amount of the Note |
Principal Amount of the Note Remaining After Such Decrease |
Notation by
Security Registrar |
32
EXHIBIT A
Form of Election Notice
The undersigned hereby elects to extend the maturity of the Principal Life Income Fundings Trust
35 Extendible Medium-Term Note (CUSIP 00000XXX0) (the βNoteβ) (or the portion thereof specified
below) with the effect provided in said Note by delivering this Election Notice duly completed by
the holder of said Note, and in the event of an election to extend the maturity of only a portion
of the principal amount of said Note, by surrendering said Note to the Paying Agent at the
following address:
Citibank, N.A.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxx
Xxxxxxxxx: (000) 000-0000
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxx
Xxxxxxxxx: (000) 000-0000
or such other address of which the Paying Agent shall from time to time notify the holders of the
Notes.
If the option to extend the maturity of less than the entire principal amount of said Note is
elected, specify the portion of said Note (which shall be $100,000 or an integral multiple of
$1,000 in excess thereof) as to which the holder elects to extend the maturity: $____________; and
specify the denomination or denominations (which shall be $100,000 or an integral multiple of
$1,000 in excess thereof) of the Notes in the form attached to said Note as Exhibit B to
be issued to the holder for the portion of said Note to which the option to extend the maturity
is not being elected (in absence of any such specification one such Note in the form of said
Exhibit B will be issued for the portion as to which the option to extend maturity is not
being made): $____________.
Date: |
||||
NOTICE: The signature on this Election Notice must correspond with the name as written upon the face of the Note in every particular, without alteration or enlargement or any change whatever. |
33
EXHIBIT B
Form of Short-Term Note
THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE (HEREINAFTER DEFINED) AND IS
REGISTERED IN THE NAME OF A DEPOSITARY (AS DEFINED IN THE INDENTURE) OR A NOMINEE OF A DEPOSITARY.
THIS NOTE IS NOT EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITARY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO
TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A WHOLE BY THE DEPOSITARY TO A NOMINEE
OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A
NEW YORK CORPORATION (βDTCβ), TO THE TRUST (HEREINAFTER DEFINED) OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND UNLESS ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE
& CO. OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
CUSIP No.:
Principal Amount:
U.S. $
PRINCIPAL LIFE INCOME FUNDINGS TRUST 35
SECURED MEDIUM-TERM NOTE
SECURED MEDIUM-TERM NOTE
Original Issue Date:
Issue Price: 100.0%
Stated Maturity Date:
l , or if such day is not a Business Day, the immediately preceding
Business Day
Settlement Date:
Securities Exchange Listing: oYes No. Γ½ If yes,
indicate name(s) of Securities Exchange(s): _________
Depositary: The Depository Trust Company
Authorized Denominations: $100,000 and integral multiples of $1,000 in excess thereof.
Collateral held in the Trust: Principal Life Insurance Company Funding Agreement No.6-15308,
the related Principal Financial Group, Inc. Guarantee which fully and unconditionally guarantees
the payment obligations of Principal Life Insurance Company under the Funding Agreement, all
proceeds of the Funding Agreement and the related Guarantee and all rights and books and records
pertaining to the foregoing.
Additional Amounts to be Paid: oYes No Γ½
34
Interest Rate or Formula:
Fixed Rate Note: oYes Γ½No. If yes,
Interest Rate:
Interest Payment Frequency:
Interest Payment Dates:
Day Count Convention:
Additional/Other Terms:
Interest Payment Frequency:
Interest Payment Dates:
Day Count Convention:
Additional/Other Terms:
Amortizing Note: oYes Γ½No. If yes,
Amortization schedule or formula:
Additional/Other Terms:
Additional/Other Terms:
Discount Note: oYesΓ½ No. If yes,
Total Amount of Discount:
Initial Accrual Period of Discount:
Interest Payment Dates:
Additional/Other Terms
Initial Accrual Period of Discount:
Interest Payment Dates:
Additional/Other Terms
Redemption Provisions: oYesΓ½No. If yes,
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
Additional/Other Terms:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
Additional/Other Terms:
Repayment Provisions: oYesΓ½No. If yes,
Repayment Date(s):
Repayment Price:
Additional/Other Terms:
Repayment Price:
Additional/Other Terms:
Floating Rate Note: Γ½Yes oNo. If yes,
Regular Floating Rate Notes Γ½
Inverse Floating Rate Notes o
Floating Rate/ Fixed Rate Notes: o
Inverse Floating Rate Notes o
Floating Rate/ Fixed Rate Notes: o
Interest Rate: Three-Month USD LIBOR (except as noted under βInterest Rate Basisβ)
plus the applicable Spread set forth in attached Schedule II.
Interest Rate Basis(es): Three-Month USD LIBOR. With respect to the final interest payment on
the Stated Maturity Date, the Interest Rate Basis will be (i) One-Month USD LIBOR, if the
final Interest Reset Period is a period of one month; (ii) Two-Month USD LIBOR, if the final
Interest Reset Period is a period of two months; (iii) Three-Month USD LIBOR, if the final
Interest Reset Period is a period of three months; and (iv) an interpolated rate between
Two-Month USD LIBOR and Three-Month USD LIBOR, if the final Interest Reset Period is a period
longer than two months and shorter than three months.
LIBOR Γ½
LIBOR Reuters Page: LIBOR01
LIBOR Currency:
LIBOR Currency:
EURIBOR o
CMT Rate o
CMT Rate o
Designated Reuters Page:
If FEDCMT
o Weekly Average
o Monthly Average
o Weekly Average
o Monthly Average
Designated CMT Maturity Index:
CD Rate o
Commercial Paper Rate o
Constant Maturity Swap Rate o
Eleventh District Cost of Funds Rate o
Federal Funds Open Rate o
Federal Funds Rate o
Prime Rate o
Treasury Rate o
Commercial Paper Rate o
Constant Maturity Swap Rate o
Eleventh District Cost of Funds Rate o
Federal Funds Open Rate o
Federal Funds Rate o
Prime Rate o
Treasury Rate o
Index Maturity: Three-month (subject to the exceptions listed above in βInterest Rate Basisβ)
Spread: See attached Schedule II.
Spread Multiplier: Not applicable
Initial Interest Rate, if any: Not applicable
Initial Interest Reset Date: l
Interest Reset Dates: Quarterly, on January 9, April 9, July 9, and October 9 of each year,
subject to adjustment in accordance with the Modified Following Business Day Convention.
Interest Determination Date(s): The second London Banking Days preceding the related Interest
Reset Date.
Interest Payment Dates: Quarterly on January 9, April 9, July 9 and October 9 of each year,
subject to adjustment in accordance with the Modified Following Business Day Convention, and
the Stated Maturity Date; provided that the final Interest Payment Date will be the Stated
Maturity Date, and interest for the final Interest Reset Period will accrue from and including
the Interest Payment Date immediately preceding the Stated Maturity Date to but excluding the
Stated Maturity Date.
Initial Interest Payment Date: l
Maximum Interest Rate, if any: Not applicable.
Minimum Interest Rate, if any: Not applicable.
35
Fixed Rate Commencement Date, if any: Not applicable.
Floating Rate Commencement Date, if any: Not applicable.
Fixed Interest Rate, if any: Not applicable.
Day Count Convention: Actual/360
Additional/Other Terms:
Regular Record Date(s): The date that is fifteen (15) calendar days preceding the applicable
Interest Payment Date.
Sinking Fund: Not applicable
Specified Currency: U.S. Dollars
Exchange Rate Agent: Not Applicable
Calculation Agent: Citibank, N.A.
Additional/Other Terms: See attached Schedule II.
The Principal Life Income Fundings Trust designated above (the βTrustβ), for value received,
hereby promises to pay to Cede & Co., or its registered assigns, the Principal Amount specified
above on the Stated Maturity Date specified above and, if so specified above, to pay interest
thereon from the Original Issue Date specified above or from the most recent Interest Payment Date
specified above to which interest has been paid or duly provided for at the rate per annum
determined in accordance with the provisions on the reverse hereof and as specified above, until
the principal hereof is paid or made available for payment. Unless otherwise specified above,
payments of principal, premium, if any, and interest hereon will be made in the lawful currency of
the United States of America (βU.S. Dollarsβ or βUnited States dollarsβ). If the Specified Currency
specified above is other than U.S. Dollars, the Holder (as defined in the Indenture) shall receive
such payments in such Foreign Currency (as hereinafter defined). The βPrincipal Amountβ of this
Note at any time means (1) if this Note is a Discount Note (as hereinafter defined), the Amortized
Face Amount (as hereinafter defined) at such time (as defined in Section 3(c) on the
reverse hereof) and (2) in all other cases, the Principal Amount hereof. Capitalized terms not
otherwise defined herein shall have their meanings set forth in the Indenture, dated as of the date
of the Pricing Supplement (the βIndentureβ), between Citibank, N.A., as the indenture trustee (the
βIndenture Trusteeβ), and the Trust, or on the face hereof.
This Note will mature on the Stated Maturity Date, unless its principal (or any installment of
its principal) becomes due and payable prior to the Stated Maturity Date, whether, as applicable,
by the declaration of acceleration of maturity, notice of redemption by the Trust or otherwise (the
Stated Maturity Date or any date prior to the Stated Maturity Date on which this Note becomes due
and payable, as the case may be, is referred to as the βMaturity Dateβ).
A βDiscount Noteβ is any Note that has an Issue Price that is less than 100% of the Principal
Amount thereof by a percentage that is equal to or greater than 0.25% multiplied by the product of
the principal amount of the Notes and the number of full years to the Stated Maturity Date.
Unless otherwise specified above, the interest payable on each Interest Payment Date or the
Maturity Date will be the amount of interest accrued from and including the Original Issue Date or
from and including the last Interest Payment Date to which interest has been paid or duly provided
for, as the case may be, to, but excluding, such Interest Payment Date or the Maturity Date, as the
case may be.
36
Unless otherwise specified above, the interest payable on any Interest Payment Date will be
paid to the Holder on the Regular Record Date for such Interest Payment Date, which Regular Record
Date shall be the fifteenth (15th) calendar day, whether or not a Business Day, immediately
preceding the related Interest Payment Date; provided that, notwithstanding any provision of the
Indenture to the contrary, interest payable on any Maturity Date shall be payable to the Person to
whom principal shall be payable; and provided, further, that unless otherwise specified above, in
the case of a Note initially issued between a Regular Record Date and the Interest Payment Date
relating to such Regular Record Date, interest for the period beginning on the Original Issue Date
and ending on such Interest Payment Date shall be paid on the Interest Payment Date following the
next succeeding Regular Record Date to the Holder on such next succeeding Regular Record Date.
Payments of principal of, and premium, if any, and interest and other amounts due and owing,
if any, will be made through the Indenture Trustee to the account of DTC or its nominee and will be
made in accordance with depositary arrangements with DTC.
Unless otherwise specified on the face hereof, the Holder hereof will not be obligated to pay
any administrative costs imposed by banks in making payments in immediately available funds by the
Trust. Unless otherwise specified on the face hereof, any tax assessment or governmental charge
imposed upon payments hereunder, including, without limitation, any withholding tax, will be borne
by the Holder hereof.
REFERENCE IS XXXXXX MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET FORTH ON THE REVERSE
HEREOF. SUCH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT AS IF SET FORTH AT THIS
PLACE.
Unless the certificate of authentication hereon shall have been executed by the Indenture
Trustee pursuant to the Indenture, this Note shall not be entitled to any benefit under such
Indenture or be valid or obligatory for any purpose.
37
THE PRINCIPAL LIFE INCOME FUNDINGS TRUST SPECIFIED ON THE FACE OF THIS NOTE |
||||
Dated: Original Issue Date
|
By: U.S. Bank Trust National Association, not in its individual capacity but solely as Trustee. | |||
By: | ||||
Authorized Officer |
CERTIFICATE OF AUTHENTICATION
This is one of the Notes of the Principal Life Income Fundings Trust specified on the face of
this Note referred to in the within-mentioned Indenture.
CITIBANK, N.A. As Indenture Trustee |
||||
Dated: Original Issue Date
|
||||
By: | ||||
Authorized Signatory |
38
[REVERSE FORM OF NOTE]
Section 1. General. This Note is one of a duly authorized issue of Notes of the Trust. The
Notes are issued pursuant to the Indenture.
Section 2. Currency.
(a) Unless specified otherwise on the face hereof, this Note is denominated in, and payments
of principal, premium, if any, and/or interest, if any, will be made in U.S. Dollars. If specified
as the Specified Currency, this Note may be denominated in, and payments of principal, premium, if
any, and/or interest, if any, may be made in a single currency other than U.S. Dollars (a βForeign
Currencyβ). If this Note is denominated in a Foreign Currency, the Holder of this Note is required
to pay for this Note in the Specified Currency.
(b) Unless specified otherwise on the face hereof, if this Note is denominated in a Foreign
Currency, the Trust is obligated to make payments of principal of, and premium, if any, and
interest, if any, on, this Note in the Specified Currency. Any amounts so payable by the Trust in
the Specified Currency will be converted by the Exchange Rate Agent into U.S. Dollars for payment
to the Holder hereof unless otherwise specified on the face of this Note or the Holder elects, in
the manner described below, to receive these amounts in the Specified Currency. If this Note is
denominated in a Foreign Currency, any U.S. Dollar amount to be received by the Holder hereof will
be based on the highest bid quotation in The City of New York received by the Exchange Rate Agent
at approximately 11:00 A.M., New York City time, on the second Business Day preceding the
applicable payment date from three recognized foreign exchange dealers (one of whom may be the
Exchange Rate Agent) selected by the Exchange Rate Agent and approved by the Trust for the purchase
by the quoting dealer of the Specified Currency for U.S. Dollars for settlement on that payment
date in the aggregate amount of the Specified Currency payable to all Holders of the Notes
scheduled to receive U.S. Dollar payments and at which the applicable dealer commits to execute a
contract. All currency exchange costs will be borne by the Holders of the Notes by deductions from
any payments. If three bid quotations are not available, payments will be made in the Specified
Currency. If this Note is denominated in a Foreign Currency, the Holder of this Note may elect to
receive all or a specified portion of any payment of principal, premium, if any, and/or interest,
if any, in the Specified Currency by submitting a written request to the Indenture Trustee at its
Corporate Trust Office in The City of New York on or prior to the applicable Regular Record Date or
at least 15 calendar days prior to the Maturity Date, as the case may be. This written request may
be mailed or hand delivered or sent by cable, telex or other form of facsimile transmission. This
election will remain in effect until revoked by written notice delivered to the Indenture Trustee
on or prior to a Regular Record Date or at least 15 calendar days prior to the Maturity Date, as
the case may be. The Holder of a Note denominated in a Foreign Currency to be held in the name of a
broker or nominee should contact their broker or nominee to determine whether and how an election
to receive payments in the Specified Currency may be made. Unless specified otherwise on the face
hereof, if the Specified Currency is other than U.S. Dollars, a beneficial owner of a Note
represented by a global security which elects to receive payments of principal, premium, if any,
and/or interest, if any, in the Specified Currency must notify the participant through which it
owns its interest on or prior to the applicable Regular Record Date or at least 15 calendar days
prior to the Maturity
39
Date, as the case may be, of its election. The applicable participant must notify DTC of its
election on or prior to the third Business Day after the applicable Regular Record Date or at least
12 calendar days prior to the Maturity Date, as the case may be, and DTC will notify the Indenture
Trustee of that election on or prior to the fifth Business Day after the applicable Regular Record
Date or at least ten calendar days prior the Maturity Date, as the case may be. If complete
instructions are received by the participant from the applicable beneficial owner and forwarded by
the participant to DTC, and by DTC to the Indenture Trustee, on or prior to such dates, then the
applicable beneficial owner will receive payments in the Specified Currency.
(c) The Trust will indemnify the Holder hereof against any loss incurred as a result of any
judgment or order being given or made for any amount due under this Note and that judgment or order
requiring payment in a currency (the βJudgment Currencyβ) other than the Specified Currency, and as
a result of any variation between: (i) the rate of exchange at which the Specified Currency amount
is converted into the Judgment Currency for the purpose of that judgment or order; and (ii) the
rate of exchange at which the Holder, on the date of payment of that judgment or order, is able to
purchase the Specified Currency with the amount of the Judgment Currency actually received.
(d) Unless otherwise specified on the face hereof, if payment hereon is required to be made in
a Foreign Currency and such currency is unavailable due to the imposition of exchange controls or
other circumstances beyond the Trustβs control, then the Trust will be entitled to make payments
with respect hereto in U.S. Dollars on the basis of the Market Exchange Rate (as hereinafter
defined), computed by the Exchange Rate Agent, on the second Business Day prior to the particular
payment or, if the Market Exchange Rate is not then available, on the basis of the most recently
available Market Exchange Rate.
(e) The βMarket Exchange Rateβ for the Foreign Currency shall mean the noon dollar buying rate
in The City of New York for cable transfers for the Foreign Currency as certified for customs
purposes (or, if not so certified, as otherwise determined) by the Federal Reserve Bank of New
York.
(f) All determinations made by the Exchange Rate Agent shall be at its sole discretion and
shall, in the absence of manifest error, be conclusive for all purposes and binding on the Holder
hereof.
(g) All costs of exchange in respect of this Note, if denominated in a Foreign Currency, will
be borne by the Holder hereof.
(i) This Note will bear interest at the rate per annum specified on the face hereof.
Interest on this Note will be computed on the basis of a 360-day year of twelve 30-day
months.
40
(ii) Unless otherwise specified on the face hereof, the Interest Payment Dates for this
Note will be as follows:
Interest Payment Frequency | Interest Payment Dates | |
Monthly
|
Fifteenth day of each calendar month, beginning in the first calendar month following the month this Note was issued. | |
Quarterly
|
Fifteenth day of every third calendar month, beginning in the third calendar month following the month this Note was issued. | |
Semi-annual
|
Fifteenth day of every sixth calendar month, beginning in the sixth calendar month following the month this Note was issued. | |
Annual
|
Fifteenth day of every twelfth calendar month, beginning in the twelfth calendar month following the month this Note was issued. |
(iii) Unless otherwise specified on the face hereof, if any Interest Payment Date or the
Maturity Date of this Note falls on a day that is not a Business Day, the Trust will make
the required payment of principal, premium, if any, and/or interest or other amounts on
the next succeeding Business Day, and no additional interest will accrue in respect of
the payment made on that next succeeding Business Day.
(b) Floating Rate Notes. If this Note is specified on the face hereof as a
βFloating Rate Noteβ:
41
instrument or obligation with respect to which the related Interest Rate Basis or
Interest Rate Bases will be calculated.
42
face hereof; provided, however, that, with respect to a Floating Rate/Fixed Rate Note, the rate
of interest thereon will not reset after the particular Fixed Rate Commencement Date. If any
Interest Reset Date for this Floating Rate Note would otherwise be a day that is not a Business
Day, the particular Interest Reset Date will be postponed to the next succeeding Business Day,
except that in the case of a Floating Rate Note as to which LIBOR is an applicable Interest Rate
Basis and that Business Day falls in the next succeeding calendar month, the particular Interest
Reset Date will be the immediately preceding Business Day.
43
Rate Note. The βCalculation Dateβ, if applicable, pertaining to any Interest Determination Date
will be the earlier of: (1) the tenth calendar day after the particular Interest Determination
Date or, if such day is not a Business Day, the next succeeding Business Day; or (2) the
Business Day immediately preceding the applicable Interest Payment Date or the Maturity Date, as
the case may be.
44
interest factor is computed by adding the interest factor calculated for each day in the
particular Interest Reset Period. The interest factor for each day will be computed by dividing
the interest rate applicable to such day by 360, in the case of a Floating Rate Note as to which
the CD Rate, the Commercial Paper Rate, the Eleventh District Cost of Funds Rate, the Federal
Funds Open Rate, the Federal Funds Rate, LIBOR, EURIBOR or the Prime Rate is an applicable
Interest Rate Basis, or by the actual number of days in the year, in the case of a Floating Rate
Note as to which the CMT Rate or the Treasury Rate is an applicable Interest Rate Basis. In the
case of a series of Notes that bear interest at floating rates as to which the Constant Maturity
Swap Rate is the Interest Rate Basis, the interest factor for each day will be computed by
dividing the number of days in the interest period by 360 (the number of days to be calculated
on the base is of a year of 360 days with twelve 30-day months (unless (i) the last day of the
interest period is the 31st day of a month but the first day of the interest period is a day
other than the 30th or 31st day of a month, in which case the month that includes that last day
shall not be considered to be shortened to a 30-day month, or (ii) the last day of the interest
period is the last day of the month of February, in which case the month of February shall not
be considered to be lengthened to a 30-day month)). The interest factor for a Floating Rate Note
as to which the interest rate is calculated with reference to two or more Interest Rate Bases
will be calculated in each period in the same manner as if only the applicable Interest Rate
Basis specified above applied.
45
successor publication, published by the Board of Governors of the Federal Reserve System.
βH.15 Daily Updateβ means the daily update of H.15(519), available through the world-wide-web
site of the Board of Governors of the Federal Reserve System at
xxxx://xxx.xxxxxxxxxxxxxx.xxx/xxxxxxxx/X00/ update, or any successor site or publication.
(1) if Reuters Page FRBCMT is specified on the face hereof:
i. | the percentage equal to the yield for United States Treasury securities at βconstant maturityβ having the Index Maturity specified on the face hereof as published in H.15(519) under the caption βTreasury Constant Maturitiesβ, as the yield is displayed on Reuters Service (or any successor service) on page FRBCMT (or any other page as may replace the specified page on that service) (βReuters Page FRBCMTβ), for the particular Interest Determination Date; or |
ii. | if the rate referred to in clause (i) does not so appear on Reuters Page FRBCMT, the percentage equal to the yield for United States Treasury securities at βconstant maturityβ having the particular Index Maturity and for the particular Interest Determination Date as published in H.15(519) under the caption βTreasury Constant Maturitiesβ; or |
iii. | if the rate referred to in clause (ii) does not so appear in H.15(519), the rate on the particular Interest Determination Date for the period of the particular Index Maturity as may then be published by either the Federal Reserve System Board of Governors or the United States Department of the Treasury that the Calculation Agent determines to be comparable to the rate which would otherwise have been published in H.15(519); or |
iv. | if the rate referred to in clause (iii) is not so published, the rate on the particular Interest Determination Date calculated by the Calculation Agent as a yield to maturity based on the arithmetic mean of the secondary market bid prices at approximately 3:30 P.M., New York City time, on that Interest Determination Date of three leading primary United States government securities dealers in The City of New York (which may include the purchasing agent or its affiliates) (each, a βReference Dealerβ) selected by the Calculation Agent from five Reference Dealers selected by the Calculation Agent and eliminating the highest quotation, or, in the event of equality, one of the highest, and the lowest quotation or, in the event of equality, one of the lowest, for United States Treasury securities with an original maturity equal to the particular Index Maturity, a remaining term to maturity no more than one year shorter than that Index Maturity and in a principal amount that is representative for a single transaction in the securities in that market at that time; or |
46
v. | if fewer than five but more than two of the prices referred to in clause (iv) are provided as requested, the rate on the particular Interest Determination Date calculated by the Calculation Agent based on the arithmetic mean of the bid prices obtained and neither the highest nor the lowest of the quotations shall be eliminated; or |
vi. | if fewer than three prices referred to in clause (iv) are provided as requested, the rate on the particular Interest Determination Date calculated by the Calculation Agent as a yield to maturity based on the arithmetic mean of the secondary market bid prices as of approximately 3:30 P.M., New York City time, on that Interest Determination Date of three Reference Dealers selected by the Calculation Agent from five Reference Dealers selected by the Calculation Agent and eliminating the highest quotation or, in the event of equality, one of the highest and the lowest quotation or, in the event of equality, one of the lowest, for United States Treasury securities with an original maturity greater than the particular Index Maturity, a remaining term to maturity closest to that Index Maturity and in a principal amount that is representative for a single transaction in the securities in that market at that time; or |
vii. | if fewer than five but more than two prices referred to in clause (vi) are provided as requested, the rate on the particular Interest Determination Date calculated by the Calculation Agent based on the arithmetic mean of the bid prices obtained and neither the highest nor the lowest of the quotations will be eliminated; or |
viii. | if fewer than three prices referred to in clause (vi) are provided as requested, the CMT Rate in effect on the particular Interest Determination Date; or |
(2) if Reuters Page FEDCMT is specified on the face hereof:
i. | the percentage equal to the one-week or one-month, as specified on the face hereof, average yield for United States Treasury securities at βconstant maturityβ having the Index Maturity specified on the face hereof as published in H.15(519) opposite the caption βTreasury Constant Maturitiesβ, as the yield is displayed on Reuters Service (or any successor service) (on page FEDCMT or any other page as may replace the specified page on that service) (βReuters Page FEDCMTβ), for the week or month, as applicable, ended immediately preceding the week or month, as applicable, in which the particular Interest Determination Date falls; or |
ii. | if the rate referred to in clause (i) does not so appear on Reuters Page FEDCMT, the percentage equal to the one-week or one-month, as specified on the face hereof, average yield for United States Treasury securities at βconstant maturityβ having the particular Index Maturity and for the week or |
47
month, as applicable, preceding the particular Interest Determination Date as published in H.15(519) opposite the caption βTreasury Constant Maturitiesβ; or |
iii. | if the rate referred to in clause (ii) does not so appear in H.15(519), the one-week or one-month, as specified on the face hereof, average yield for United States Treasury securities at βconstant maturityβ having the particular Index Maturity as otherwise announced by the Federal Reserve Bank of New York for the week or month, as applicable, ended immediately preceding the week or month, as applicable, in which the particular Interest Determination Date falls; or |
iv. | if the rate referred to in clause (iii) is not so published, the rate on the particular Interest Determination Date calculated by the Calculation Agent as a yield to maturity based on the arithmetic mean of the secondary market bid prices at approximately 3:30 P.M., New York City time, on that Interest Determination Date of three Reference Dealers selected by the Calculation Agent from five Reference Dealers selected by the Calculation Agent and eliminating the highest quotation, or, in the event of equality, one of the highest, and the lowest quotation or, in the event of equality, one of the lowest, for United States Treasury securities with an original maturity equal to the particular Index Maturity, a remaining term to maturity no more than one year shorter than that Index Maturity and in a principal amount that is representative for a single transaction in the securities in that market at that time; or |
v. | if fewer than five but more than two of the prices referred to in clause (iv) are provided as requested, the rate on the particular Interest Determination Date calculated by the Calculation Agent based on the arithmetic mean of the bid prices obtained and neither the highest nor the lowest of the quotations shall be eliminated; or |
vi. | if fewer than three prices referred to in clause (iv) are provided as requested, the rate on the particular Interest Determination Date calculated by the Calculation Agent as a yield to maturity based on the arithmetic mean of the secondary market bid prices as of approximately 3:30 P.M., New York City time, on that Interest Determination Date of three Reference Dealers selected by the Calculation Agent from five Reference Dealers selected by the Calculation Agent and eliminating the highest quotation or, in the event of equality, one of the highest and the lowest quotation or, in the event of equality, one of the lowest, for United States Treasury securities with an original maturity greater than the particular Index Maturity, a remaining term to maturity closest to that Index Maturity and in a principal amount that is representative for a single transaction in the securities in that market at the time; or |
48
vii. | if fewer than five but more than two prices referred to in clause (vi) are provided as requested, the rate on the particular Interest Determination Date calculated by the Calculation Agent based on the arithmetic mean of the bid prices obtained and neither the highest nor the lowest of the quotations will be eliminated; or |
viii. | if fewer than three prices referred to in clause (vi) are provided as requested, the CMT Rate in effect on that Interest Determination Date. |
If two United States Treasury securities with an original maturity greater than the Index
Maturity specified on the face hereof have remaining terms to maturity equally close to the
particular Index Maturity, the quotes for the United States Treasury security with the
shorter original remaining term to maturity will be used.
Money Market Yield = | D x 360 | x 100 | ||
360 β (D x M) |
where βDβ refers to the applicable per annum rate for commercial paper quoted on a bank
discount basis and expressed as a decimal, and βMβ refers to the actual number of days in the
applicable Interest Reset Period.
49
50
immediately preceding that Interest Determination Date; or (3) if the Federal Home Loan Bank
of San Francisco fails to announce the Eleventh District Index on or prior to the particular
Interest Determination Date for the calendar month immediately preceding that Interest
Determination Date, the Eleventh District Cost of Funds Rate in effect on the particular
Interest Determination Date.
51
titled βOPENβ. If the rate is not available for an Interest Determination Date, the rate for
that Interest Determination Date shall be the Federal Funds Rate as determined below.
52
calculated or, if no currency is specified on the face hereof, United States dollars. βLIBOR
Pageβ means the display on Reuters Service (or any successor service) on the page specified on
the face hereof (or any other page as may replace that page on that service) for the purpose
of displaying the London interbank rates of major banks for the LIBOR Currency.
53
Highβ; or (3) if the rate referred to in clause (2) is not so published by 3:00 P.M., New York
City time, on the related Calculation Date, the Bond Equivalent Yield of the auction rate of
the applicable Treasury Bills as announced by the United States Department of the Treasury; or
(4) if the rate referred to in clause (3) is not so announced by the United States Department
of the Treasury, or if the Auction is not held, the Bond Equivalent Yield of the rate on the
particular Interest Determination Date of the applicable Treasury Bills as published in
H.15(519) under the caption βU.S. Government Securities/Treasury Bills/Secondary Marketβ; or
(5) if the rate referred to in clause (4) is not so published by 3:00 P.M., New York City
time, on the related Calculation Date, the rate on the particular Interest Determination Date
of the applicable Treasury Bills as published in H.15 Daily Update, or another recognized
electronic source used for the purpose of displaying the applicable rate, under the caption
βU.S. Government Securities/Treasury Bills/Secondary Marketβ; or (6) if the rate referred to
in clause (5) is not so published by 3:00 P.M., New York City time, on the related Calculation
Date, the rate on the particular Interest Determination Date calculated by the Calculation
Agent as the Bond Equivalent Yield of the arithmetic mean of the secondary market bid rates,
as of approximately 3:30 P.M., New York City time, on that Interest Determination Date, of
three primary United States government securities dealers (which may include the purchasing
agent or its affiliates) selected by the Calculation Agent, for the issue of Treasury Bills
with a remaining maturity closest to the Index Maturity specified on the face hereof; or (7)
if the dealers so selected by the Calculation Agent are not quoting as mentioned in clause
(6), the Treasury Rate in effect on the particular Interest Determination Date. βBond
Equivalent Yieldβ means a yield (expressed as a percentage) calculated in accordance with the
following formula:
Bond Equivalent Yield = | D x N | x 100 | ||
360 β (D x M) |
where βDβ refers to the applicable per annum rate for Treasury Bills quoted on a bank discount
basis and expressed as a decimal, βNβ refers to 365 or 366, as the case may be, and βMβ refers
to the actual number of days in the applicable Interest Reset Period.
54
purposes of determining the amount of Discount that has accrued as of any date on which a
redemption, repayment or acceleration of maturity occurs for a Discount Note, a Discount
will be accrued using a constant yield method. The constant yield will be calculated using a
30-day month, 360-day year convention, a compounding period that, except for the Initial
Period (as defined below), corresponds to the shortest period between Interest Payment Dates
for the applicable Discount Note (with ratable accruals within a compounding period), a
coupon rate equal to the initial coupon rate applicable to the applicable Discount Note and
an assumption that the maturity of such Discount Note will not be accelerated. If the period
from the date of issue to the first Interest Payment Date for a Discount Note (the βInitial
Periodβ) is shorter than the compounding period for such Discount Note, a proportionate
amount of the yield for an entire compounding period will be accrued. If the Initial Period
is longer than the compounding period, then the period will be divided into a regular
compounding period and a short period with the short period being treated as provided above.
Section 4. Redemption. If no redemption right is set forth on the face hereof, this Note
may not be redeemed prior to the Stated Maturity Date, except as set forth in the Indenture or in
Section 10 hereof. In the case of a Note that is not a Discount Note, if a redemption right is set
forth on the face of this Note, the Trust shall elect to redeem this Note on the Interest Payment
Date after the Initial Redemption Date set forth on the face hereof on which the Funding Agreement
is to be redeemed in whole or in part by Principal Life Insurance Company (βPrincipal Lifeβ) (each,
a βRedemption Dateβ), in which case this Note must be redeemed on such Redemption Date in whole or
in part, as applicable, prior to the Stated Maturity Date, in increments of $1,000 at the
applicable Redemption Price (as defined below), together with unpaid interest, if any, accrued
thereon to, but excluding, the applicable Redemption Date. βRedemption Priceβ shall mean an amount
equal to the Initial Redemption Percentage (as adjusted by the Annual Redemption Percentage
Reduction, if applicable) multiplied by the unpaid Principal Amount of this Note to be redeemed.
The unpaid Principal Amount of this Note to be redeemed shall be determined by multiplying (1) the
Outstanding Principal Amount of this Note by (2) the quotient derived by dividing (A) the
outstanding principal amount of the Funding Agreement to be redeemed by Principal Life by (B) the
outstanding principal amount of the Funding Agreement. The Initial Redemption Percentage, if any,
applicable to this Note shall decline at each anniversary of the Initial Redemption Date by an
amount equal to the applicable Annual Redemption Percentage Reduction, if any, until the Redemption
Price is equal to 100% of the unpaid amount thereof to be redeemed. Notice must be given not more
than sixty (60) nor less than thirty (30) calendar days prior to the proposed Redemption Date. In
the event of redemption of this Note in part only, a new Note for the unredeemed portion hereof
shall be issued in the name of the Holder hereof
55
upon the surrender hereof. If less than all of this Note is redeemed, the Indenture Trustee will
select by lot or, in its discretion, on a pro rata basis, the amount of the interest of each direct
participant in the Trust to be redeemed.
Section 5. Sinking Funds and Amortizing Notes. Unless specified on the face hereof, this
Note will not be subject to, or entitled to the benefit of, any sinking fund. If this Note is an
Amortizing Note, this Note may pay an amount in respect of both interest and principal amortized
over the life of this Note.
Section 6. Repayment. If no repayment right is set forth on the face hereof, this Note may
not be repaid at the option of the Holder hereof prior to the Stated Maturity Date. If a repayment
right is granted on the face of this Note, this Note may be subject to repayment at the option of
the Holder on any Interest Payment Date on and after the date, if any, indicated on the face hereof
(each, a βRepayment Dateβ). On any Repayment Date, unless otherwise specified on the face hereof,
this Note shall be repayable in whole or in part in increments of $1,000 at the option of the
Holder hereof at a repayment price equal to 100% of the Principal Amount to be repaid, together
with interest thereon payable to the Repayment Date. For this Note to be repaid in whole or in part
at the option of the Holder hereof, this Note must be received by the Indenture Trustee, with the
form entitled βOption to Elect Repaymentβ, below, duly completed by the Indenture Trustee. Exercise
of such repayment option by the Holder hereof shall be irrevocable. In the event of a repayment of
this Note in part only, a new Note for the portion hereof not repaid shall be issued in the name of
the Holder hereof upon the surrender hereof.
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Section 7. Modifications and Waivers. The Indenture contains provisions permitting the
Trust and the Indenture Trustee (1) at any time and from time to time without notice to, or the
consent of, the Holders of any Notes issued under the Indenture to enter into one or more
supplemental indentures for certain enumerated purposes and (2) with the consent of the Holders of
a majority in aggregate principal amount of the Outstanding Notes affected thereby, to enter into
one or more supplemental indentures for the purpose of adding any provisions to, or changing in any
manner or eliminating any of the provisions of, the Indenture or of modifying in any manner the
rights of Holders of Notes under the Indenture; provided, that, with respect to certain enumerated
provisions, no such supplemental indenture shall be entered into without the consent of the Holder
of each Note affected thereby. Any such consent or waiver by the Holder of this Note shall be
conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note
issued upon the registration of transfer hereof or in exchange hereof or in lieu hereof, whether or
not notation of such consent or waiver is made upon this Note or such other Notes.
Section 8. Obligations Unconditional. No reference herein to the Indenture and no
provisions of this Note or of the Indenture shall impair the right of each Holder of any Note,
which is absolute and unconditional, to receive payment of the principal of, and any interest on,
and premium, if any, on, such Note on the respective Stated Maturity Date or redemption date
thereof and to institute suit for the enforcement of any such payment, and such rights shall not be
impaired without the consent of such Holder.
Section 9. Events of Default. If an Event of Default with respect to this Note shall occur
and be continuing, the principal of, and all other amounts payable on, the Notes may be declared
due and payable, or may be automatically accelerated, as the case may be, in the manner and with
the effect provided in the Indenture. In the event that this Note is a Discount Note, the amount of
principal of this Note that becomes due and payable upon such acceleration shall be equal to the
amount calculated as set forth in Section 3(c) hereof.
Section 10. Withholding; No Additional Amounts; Tax Event and Redemption. All amounts due
on this Note will be made without any applicable withholding or deduction for or on account of any
present or future taxes, duties, levies, assessments or other governmental charges of whatever
nature imposed or levied by or on behalf of any governmental authority, unless such withholding or
deduction is required by law. Unless otherwise specified on the face hereof, the Trust will not pay
any additional amounts to the Holder of this Note in respect of such withholding or deduction, any
such withholding or deduction will not give rise to an event of default or any independent right or
obligation to redeem this Note and the Holder will be deemed for all purposes to have received cash
in an amount equal to the portion of such withholding or deduction that is attributable to such
Holderβs interest in this Note as equitably determined by the Trust.
If (1) a Tax Event (defined below) as to the Funding Agreement occurs and (2) Principal Life
redeems the Funding Agreement in whole or in part, the Trust will redeem the Notes, subject to the
terms and conditions of Section 2.04 of the Standard Indenture Terms, at the Tax Event
Redemption Price (defined below) together with unpaid interest accrued thereon to the applicable
redemption date. βTax Eventβ means that Principal Life shall have received an opinion of
independent legal counsel stating in effect that as a result of (a) any amendment to, or change
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(including any announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or therein or (b) any
amendment to, or change in, an interpretation or application of any such laws or regulations by any
governmental authority in the United States, which amendment or change is enacted, promulgated,
issued or announced on or after the effective date of the Funding Agreement, there is more than an
insubstantial risk that (i) the Trust is, or will be within ninety (90) days of the date thereof,
subject to U.S. federal income tax with respect to interest accrued or received on the Funding
Agreement or (ii) the Trust is, or will be within ninety (90) days of the date thereof, subject to
more than a de minimis amount of taxes, duties or other governmental charges. βTax Event Redemption
Priceβ means an amount equal to the unpaid principal amount of this Note to be redeemed, which
shall be determined by multiplying (1) the Outstanding Principal Amount of this Note by (2) the
quotient derived by dividing (A) the outstanding principal amount to be redeemed by Principal Life
of the Funding Agreement by (B) the outstanding principal amount of the Funding Agreement.
Section 11. Listing. Unless otherwise specified on the face hereof, this Note will not be
listed on any securities exchange.
Section 12. Collateral. The Collateral for this Note includes the Funding Agreement and the
Guarantee specified on the face hereof.
Section 13. No Recourse Against Certain Persons. No recourse shall be had for the payment
of any principal, interest or any other sums at any time owing under the terms of this Note, or for
any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Indenture
or any indenture supplemental thereto, against the Nonrecourse Parties, whether by virtue of any
constitution, statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise, all such personal liability being, by the acceptance hereof and as part of the
consideration for issue hereof, expressly waived and released.
Section 14. Miscellaneous.
(a) This Note is issuable only as a registered Note without coupons in denominations of $1,000
and any integral multiple in excess thereof unless otherwise specified on the face of this Note.
(b) Prior to due presentment for registration of transfer of this Note, the Trust, the
Indenture Trustee, the Registrar, the Paying Agent, any Agent, and any other agent of the Trust or
the Indenture Trustee may treat the Person in whose name this Note is registered as the owner
hereof for the purpose of receiving payment as herein provided and for all other purposes, whether
or not this Note shall be overdue, and none of the Trust, the Indenture Trustee, the Registrar, the
Paying Agent, any Agent, or any other agent of the Trust or the Indenture Trustee shall be affected
by notice to the contrary.
(c) The Notes are being issued by means of a book-entry-only system with no physical
distribution of certificates to be made except as provided in the Indenture. The book-entry system
maintained by DTC will evidence ownership of the Notes, with transfers of ownership
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effected on the records of DTC and its participants pursuant to rules and procedures
established by DTC and its participants. The Trust and the Indenture Trustee will recognize Cede &
Co., as nominee of DTC, as the registered owner of the Notes, as the Holder of the Notes for all
purposes, including payment of principal, premium (if any) and interest, notices and voting.
Transfer of principal, premium (if any) and interest to participants of DTC will be the
responsibility of DTC, and transfer of principal, premium (if any) and interest to beneficial
holders of the Notes by participants of DTC will be the responsibility of such participants and
other nominees of such beneficial holders. So long as the book-entry system is in effect, the
selection of any Notes to be redeemed or repaid will be determined by DTC pursuant to rules and
procedures established by DTC and its participants. Neither the Trust nor the Indenture Trustee
shall be responsible or liable for such transfers or payments or for maintaining, supervising or
reviewing the records maintained by DTC, its participants or persons acting through such
participants.
(d) This Note or portion hereof may not be exchanged for Definitive Notes, except in the
limited circumstances provided for in the Indenture. The transfer or exchange of Definitive Notes
shall be subject to the terms of the Indenture. No service charge will be made for any registration
of transfer or exchange, but the Trust may require payment of a sum sufficient to cover any tax or
other governmental charge payable in connection therewith.
Section 15. GOVERNING LAW. THIS NOTE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK.
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OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instruct(s) the Trust to repay this Note (or
portion hereof specified below) pursuant to its terms at a price equal to the Principal Amount
hereof together with interest to the repayment date, to the undersigned, at:
(Please print or typewrite name and address of the undersigned).
For this Note to be repaid, the Indenture Trustee (or the Paying Agent on behalf of the
Indenture Trustee) must receive at its Corporate Trust Office, or at such other place or places of
which the Trust shall from time to time notify the Holder of this Note, not more than sixty (60)
nor less than thirty (30) days prior to a Repayment Date, if any, shown on the face of this Note,
this Note with this βOption to Elect Repaymentβ form duly completed.
If less than the entire Principal Amount of this Note is to be repaid, specify the portion
hereof (which shall be in increments of $1,000) which the Holder elects to have repaid and specify
the denomination or denominations (which shall be $_________or an
integral multiple of $1,000 in excess of $_________) of the Notes to be
issued to the Holder for the portion of this Note not being repaid (in the absence of any such
specification, one such Note will be issued for the portion not being repaid).
$ |
||||||||||||
DATE: |
||||||||||||
NOTICE: The signature on this Option to Elect Repayment must correspond with the name as written upon the face of this Note in every particular, without alteration or enlargement or any change whatever. | ||||||||||||
Principal Amount to be repaid, if amount to be repaid is less than
the Principal Amount of this Note (Principal Amount remaining must
be an authorized denomination)
|
Fill in for registration of Notes if to be issued otherwise than to the registered Holder: | |||||||||||
$ |
Name: | |||||||||||
Address: | ||||||||||||
(Please print name and address including zip code) |
SOCIAL SECURITY OR OTHER TAXPAYER ID NUMBER: ___________________
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SCHEDULE I
Amortization Table or Formula
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SCHEDULE II
SPREAD:
The Spread for this Note for the indicated periods is as follows:
Period | Spread | |||
From and including March 19, 2008 to but excluding the Interest Payment Date occurring in April 2009 |
0.25 | % | ||
From and including the Interest Payment Date occurring in April 2009 to but excluding March 19, 2010 |
0.30 | % | ||
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