XXXXXX & XXXXX CORPORATION
Medium-Term Notes
Due Nine Months or More from Date of Issue
DISTRIBUTION AGREEMENT
May 4, 1998
XXXXXXX XXXXX & CO.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
World Financial Center
North Tower - 10th Floor
New York, New York 10281
XXXXXXXXX XXXXXX & XXXXXXXX
SECURITIES CORPORATION
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
X.X. XXXXXX SECURITIES INC.
00 Xxxx Xxxxxx - 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
XXXXXX XXXXXXX & CO. INCORPORATED
1585 Broadway - 2nd Floor
New York, New York 10036
Ladies and Gentlemen:
Xxxxxx & Xxxxx Corporation, a Tennessee corporation (the "Company",
which term shall refer to Xxxxxx & Xxxxx Corporation and its subsidiaries
considered as one enterprise, except where the context otherwise requires),
confirms its agreement with each of you, acting directly or through an
affiliate, (each, an "Agent", and collectively, the "Agents") with respect to
the issue and sale by the Company of its Medium-Term Notes Due Nine Months or
More from Date of Issue (the "Notes"). The Notes will be issued pursuant to
the Indenture dated as of January 15, 1992, as amended and supplemented by
the First Supplemental Indenture dated as of July 28, 1992, Second
Supplemental Indenture dated as of February 10, 1998 and Third Supplemental
Indenture dated as of May 7, 1998, as further amended, modified and
supplemented from time to time (collectively, the "Indenture"), between the
Company and The Chase Manhattan Bank as trustee (successor trustee to Xxxxxx
Guaranty Trust Company of New York and First Trust of New York, National
Association) (the "Trustee"). As of the date hereof, the Company has
authorized the issuance and sale of up to $115,000,000 aggregate principal
amount of Notes through or to the Agents pursuant to the terms of this
Agreement. It is understood, however, that the Company may from time to time
authorize the issuance of additional Notes and that such additional Notes may
be sold through or to the Agents pursuant to the terms of this Agreement, all
as though the issuance of such Notes were authorized as of the date hereof.
This Agreement provides both for the sale of Notes by the Company
directly to purchasers, in which case the Agents will act as agents of the
Company in soliciting Note purchases, and (as may from time to time be agreed to
by the Company and one or more Agents) to such Agent(s) as principal for resale
to purchasers. Subject to the terms of this Agreement, the Company also
reserves the right to sell Notes directly to purchasers on its own behalf rather
than through or to the Agents.
The Company has filed with the Securities and Exchange Commission (the
"SEC") a registration statement on Form S-3 (No. 33-44153), as amended by
Amendment No. 1 thereto filed by the Company with the SEC on January 7, 1992,
for the registration of debt securities, including the Notes, under the
Securities Act of 1933, as amended (the "1933 Act"), and the offering thereof
from time to time in accordance with Rule 415 of the rules and regulations of
the SEC under the 1933 Act (the "1933 Act Regulations"). Such registration
statement has been declared effective by the SEC and the Indenture has been
qualified under the Trust Indenture Act of 1939, as amended (the "1939 Act").
Such registration statement and the prospectus constituting a part thereof, as
supplemented by any prospectus supplement and pricing supplement relating to the
Notes, including all documents incorporated therein by reference, as from time
to time amended or supplemented by the filing of documents pursuant to the
Securities Exchange Act of 1934, as amended (the "1934 Act"), the 1933 Act or
otherwise, are referred to herein as the "Registration Statement" and the
"Prospectus", respectively, except that if any revised prospectus shall be
provided to the Agents by the Company for use in connection with the offering of
the Notes which is not required to be filed by the Company pursuant to Rule
424(b) of the 1933 Act Regulations, the term "Prospectus" shall refer to such
revised prospectus from and after the time it is first provided to the Agents
for such use.
If the Company has filed an abbreviated registration statement to register
additional Notes pursuant to Rule 462(b) under the 1933 Act, then any reference
herein to the term "Registration Statement" shall include such Rule 462(b)
registration statement.
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SECTION 1. APPOINTMENT AS AGENTS. (a) APPOINTMENT OF AGENTS.
Subject to the terms and conditions stated herein, the Company hereby appoints
the Agents as agents of the Company for the purpose of soliciting purchases of
the Notes from the Company by others and agrees that, except as otherwise
contemplated herein, whenever the Company determines to sell Notes directly to
one or more Agents as principal for resale to others, it will enter into a Terms
Agreement (as hereinafter defined) relating to such sale in accordance with the
provisions of Section 3(b) hereof. The Company from time to time may offer
Notes for sale otherwise than through the Agents, solicit offers to purchase
Notes through agents other than the Agents or accept offers to purchase Notes
through an agent other than the Agents, provided that (i) the Company and such
agent shall enter into an agreement with respect to such purchases that is
substantially similar to this Agreement, including the Schedules hereto, and
(ii) the Company shall provide the Agents with a copy of such agreement promptly
following the execution thereof. Without the Company's prior written consent,
the Agents are not authorized to appoint sub-agents or to engage the services of
any other broker or dealer in connection with the offer or sale of the Notes,
except that the Agents may utilize a selling or dealer group in connection with
the resale of any Notes purchased from the Company by them as principal for
resale to others.
(b) REASONABLE EFFORTS SOLICITATIONS; RIGHT TO REJECT OFFERS. Upon
receipt of instructions from the Company, each Agent will use its reasonable
efforts to solicit purchases of such principal amount of the Notes as the
Company and the Agents shall agree upon from time to time during the term of
this Agreement, it being understood that the Company shall not approve the
solicitation of purchases of Notes in excess of the amount which shall be
authorized by the Company from time to time or in excess of the aggregate
principal amount of Notes registered pursuant to the Registration Statement.
The Agents will have no responsibility for maintaining records with respect to
the aggregate principal amount of Notes sold or for monitoring the availability
of Notes for sale under the Registration Statement. Each Agent will communicate
to the Company, orally or in writing, each offer to purchase Notes received by
such Agent, other than those offers rejected by such Agent. Each Agent shall
have the right, in its discretion reasonably exercised, to reject any proposed
purchase of Notes, as a whole or in part, and any such rejection shall not be
deemed a breach of such Agent's agreement contained herein. The Company may
accept or reject any proposed purchase of the Notes, in whole or in part.
(c) SOLICITATIONS AS AGENT; PURCHASES AS PRINCIPAL. In soliciting
purchases of the Notes on behalf of the Company, each Agent shall act solely as
agent for the Company and not as principal. Each Agent shall make reasonable
efforts to assist the Company in obtaining performance by each purchaser whose
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offer to purchase Notes has been solicited by such Agent, as agent, and accepted
by the Company. The Agents shall not have any liability to the Company in the
event any such purchase is not consummated by a purchaser for any reason. The
Agents shall not have any obligation to purchase Notes from the Company as
principal, but an Agent may agree from time to time to purchase Notes as
principal.
(d) RELIANCE. The Company and the Agents agree that any Notes the
placement of which an Agent arranges shall be placed by such Agent, and any
Notes purchased by an Agent shall be purchased, in reliance on the
representations, warranties, covenants and agreements of the Company contained
herein and on the terms and conditions and in the manner provided herein.
SECTION 2. REPRESENTATIONS AND WARRANTIES. (a) The Company
represents and warrants to each Agent as of the date hereof, as of the date of
each acceptance by the Company of an offer for the purchase of Notes (whether
through such Agent as agent or to such Agent as principal), as of the date of
each delivery of Notes (whether through such Agent as agent or to such Agent as
principal) (the date of each such delivery to an Agent as principal being
hereafter referred to as a "Settlement Date"), and as of any time that the
Registration Statement or the Prospectus shall be amended or supplemented (other
than by an amendment or supplement providing solely for a change in the interest
rates of Notes or similar changes or that relates exclusively to an offering of
debt securities other than the Notes) (each of the times referenced above being
referred to herein as a "Representation Date") as follows:
(i) DUE INCORPORATION AND QUALIFICATION. The Company has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the State of Tennessee, has corporate power and authority
to own, lease and operate its properties and to conduct its business as
described in the Prospectus; and is duly qualified to transact business and
is in good standing in each jurisdiction in which such qualification is
required, except where the failure to so qualify would not have a material
adverse effect on the financial condition, the earnings or business affairs
of the Company and its subsidiaries considered as one enterprise (a
"Material Adverse Effect").
(ii) SUBSIDIARIES. Each subsidiary of the Company which is a
significant subsidiary, as defined in Rule 405 of Regulation C of the 1933
Act Regulations (each, a "Significant Subsidiary"), has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has corporate
power and authority to own, lease and operate its properties and conduct
its business as described in the Prospectus; and
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is duly qualified to transact business and is in good standing in
each jurisdiction in which such qualification is required, except where
the failure to so qualify would not have a Material Adverse Effect; and
all of the issued and outstanding capital stock of each Significant
Subsidiary has been duly authorized and validly issued, is fully paid
and non-assessable and (except for directors' qualifying shares) is
owned by the Company, directly or through one or more subsidiaries, free
and clear of any security interest, mortgage, pledge, lien, encumbrance,
charge, claim or equity.
(iii) REGISTRATION STATEMENT AND PROSPECTUS. At the time the
Registration Statement became effective, the Registration Statement
complied, and as of the applicable Representation Date will comply, in
all material respects with the requirements of the 1933 Act and the 1933
Act Regulations and the 1939 Act and the rules and regulations of the
SEC promulgated thereunder (the "1939 Act Regulations"); the
Registration Statement, at the time it became effective, did not, and at
each time thereafter at which any amendment to the Registration
Statement becomes effective and as of each Representation Date, will
not, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and the Prospectus, as of the date
hereof does not, and as of each Representation Date will not, include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; PROVIDED,
HOWEVER, that the Company makes no representations or warranties as to
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by the Agents expressly
for use in the Registration Statement or the Prospectus or to those
parts of the Registration Statement which constitute statements of
Eligibility and Qualification of Trustees (Form T-1) under the 1939 Act.
(iv) DESIGNATED INDENTURE. As of the date hereof, the Designated
Indenture (as hereinafter defined) complied or, as of each Representation
Date, will comply in all material respects with the requirements of the
1939 Act and the 1939 Act Regulations.
(v) INCORPORATED DOCUMENTS. The documents incorporated by reference
in the Prospectus, at the time they were or hereafter are filed with the
SEC, complied or when so filed will comply, as the case may be, in all
material respects with the requirements of the 1934 Act and the rules and
regulations promulgated thereunder (the "1934
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Act Regulations"), and, when read together and with the other
information in the Prospectus, did not and will not include an untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were or are
made, not misleading; PROVIDED, HOWEVER, that the Company makes no
representations or warranties as to statements or omissions made in
reliance upon and in conformity with information furnished in writing to
the Company by the Agents expressly for use in the Registration
Statement or the Prospectus.
(vi) ACCOUNTANTS. Each of the accountants who certified the financial
statements included or incorporated by reference in the Prospectus is an
independent public accountant within the meaning of the 1933 Act and the
1933 Act Regulations with respect to the entity whose financial statements
such accountant has so certified.
(vii) FINANCIAL STATEMENTS. The consolidated financial statements
included or incorporated by reference in the Prospectus present fairly the
financial position, results of operations and changes in financial position
and shareholders' equity of the Company, as of the dates indicated and for
the periods specified, subject, in the case of unaudited financial
statements and the notes thereto, to normal year-end adjustments; such
financial statements have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis (except as
stated in such financial statements) throughout the periods involved; the
financial schedules, if any, included or incorporated by reference in the
Prospectus present fairly the information required to be stated therein.
(viii) AUTHORIZATION AND VALIDITY OF THIS AGREEMENT; THE INDENTURE;
AND THE NOTES. The execution and delivery of this Agreement and the
consummation of the transactions contemplated herein have been duly
authorized by the Company; the Indenture has been, and each supplement
thereto, if any, at such time and the supplement thereto or officers'
certificate setting forth the terms of the Notes (the Indenture, as so
supplemented by each such supplement or officers' certificate, being herein
referred to as the "Designated Indenture") will have been, duly authorized
by the Company; the Designated Indenture, when duly executed and delivered
by the Company and the Trustee, will constitute a valid and legally binding
agreement of the Company, enforceable against the Company in accordance
with its terms, except to the extent that enforcement thereof may be
limited by bankruptcy, insolvency, reorganization,
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moratorium or other similar laws now or hereafter in effect relating to
or affecting enforcement of creditors' rights generally and except as
enforcement thereof is subject to general principles of equity
(regardless of whether enforcement is considered in a proceeding in
equity or at law); the Notes have been duly and validly authorized for
issuance, offer and sale pursuant to this Agreement and, when executed,
authenticated and issued pursuant to the provisions of the Designated
Indenture and this Agreement against payment of the consideration
therefor, will constitute valid and legally binding obligations of the
Company enforceable in accordance with their terms, except to the extent
that enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to or affecting enforcement of creditors' rights
generally, except as enforcement thereof is subject to general
principles of equity (regardless of whether enforcement is considered in
a proceeding in equity or at law) and except as enforcement thereof may
be limited by (i) requirements that a claim with respect to any Notes
payable other than in U.S. dollars (or a foreign currency or currency
unit judgment in respect of such claim) be converted into U.S. dollars
at a rate or exchange prevailing on a date determined pursuant to
applicable law or (ii) governmental authority to omit, delay or prohibit
the making of payments outside the United States; the Notes and the
Designated Indenture will be substantially in the form heretofore
delivered to the Agents and conform in all material respects to the
descriptions thereof contained in the Prospectus; and the Notes will be
entitled to the benefits provided by the relevant Designated Indenture.
(ix) MATERIAL ADVERSE CHANGES OR MATERIAL TRANSACTIONS. From the
respective dates as of which information is given in the Registration
Statement and the Prospectus, except as may otherwise be stated therein or
contemplated thereby, the Company has not entered into any transactions
material to the Company and there has been no material adverse change in
the financial condition, the earnings or business affairs of the Company
and its subsidiaries considered as one enterprise (a "Material Adverse
Change") whether or not arising in the ordinary course of business.
(x) NO DEFAULTS; REGULATORY APPROVALS. Neither the Company nor any of
its Significant Subsidiaries is in violation of its charter or in default
in the performance or observance of any material obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other instrument to which it is a party or by
which it or any of them or their properties
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may be bound, except for such defaults that would not have a Material
Adverse Effect; the execution and delivery of this Agreement, the
Designated Indenture and the Notes and the consummation of the
transactions contemplated herein, therein and pursuant to any applicable
Terms Agreement have been duly authorized by all necessary corporate
action and will not conflict with or constitute a breach of, or default
under, or result in the creation or imposition of any lien, charge or
encumbrance upon any property or assets of the Company or any of its
Significant Subsidiaries pursuant to, any contract, indenture, mortgage,
loan agreement, note, lease or other instrument to which the Company or
any of its Significant Subsidiaries is a party or by which it or any of
them may be bound or to which any of the property or assets of the
Company or any such Significant Subsidiary is subject, except for such
conflicts, breaches or defaults or liens, charges or encumbrances that
would not have a Material Adverse Effect, nor will such action result in
any violation of the provisions of the charter or by-laws of the Company
or any of its Significant Subsidiaries or any law or administrative
regulation, or any administrative or court order or decree currently in
effect with respect to the Company or any Significant Subsidiary.
(xi) LEGAL PROCEEDINGS. Except as set forth in the Prospectus, there
is no pending, or, to the best knowledge of the Company, threatened action,
suit or proceeding before any court or governmental agency or body which
individually (or in the aggregate in the case of any group of related
lawsuits) is expected to have a Material Adverse Effect or adversely affect
the ability of the Company to perform its obligations under this Agreement
or the Indenture.
(xii) DESCRIPTION OF SECURITIES. The statements in the Prospectus
under the caption "Description of Securities", "Description of Notes" and
"United States Taxation", or any similar caption, insofar as they summarize
certain contracts, instruments or documents, fairly and accurately present
the information disclosed therein in all material respects.
(xiii) NO AUTHORIZATION, APPROVAL OR CONSENT REQUIRED. No
authorization, approval or consent of any court or governmental authority
or agency is necessary for the consummation by the Company of the
transactions hereunder, except such as may be required under the 1933 Act,
the 1939 Act, the 1933 Act Regulations or the 1939 Act Regulations or the
securities or "blue sky" laws of the various states and any such
authorizations, approvals or consents which the Agents are required to
obtain.
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(xiv) PATENTS AND TRADEMARKS. The Company and each of its
subsidiaries each owns or possesses, or can acquire on reasonable terms,
adequate patents, patent licenses, trademarks, service marks and trade
names necessary to carry on their business as presently conducted, except
where the failure to own or possess the same would not have a Material
Adverse Effect; and neither the Company nor any subsidiary has received any
notice of infringement of or conflict with asserted rights of others with
respect to any patents, patent licenses, trademarks, service marks or trade
names that in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would materially adversely affect the financial
condition, the earnings or business affairs of the Company and its
subsidiaries considered as one enterprise.
(xv) ENVIRONMENTAL MATTERS. Except as disclosed in the Registration
Statement and the Prospectus, no notice, notification, demand, request for
information, citation, summons or order has been issued, no complaint has
been filed, no penalty has been assessed and no investigation or review is
pending, or, to the best knowledge of the Company, is threatened by any
governmental or other entity with respect to any alleged violation by the
Company or any of its subsidiaries of any domestic law, ordinance, rule,
regulation or order of any governmental entity relating to pollution or
protection of human health, the environment (including, without limitation,
ambient air, surface water, groundwater, land surface or subsurface strata)
or wildlife, including, without limitation, laws and regulations relating
to the release or threatened release of chemicals, pollutants,
contaminants, wastes, toxic substances, hazardous, substances, petroleum or
petroleum products (collectively, "Hazardous Materials") or to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials in connection with the conduct
of the business of the Company or any of its subsidiaries, which violation,
if determined adversely would, in the opinion of the Company, have a
Material Adverse Effect; and to the best knowledge of the Company, the
businesses of the Company and each of its subsidiaries are each being
operated, and each such business is, in compliance with all applicable
environmental laws, rules and regulations, except where the failure to
comply therewith would not have a Material Adverse Effect.
(b) ADDITIONAL CERTIFICATIONS. Any certificate signed by any officer
of the Company and delivered to the Agents or to counsel for the Agents in
connection with an offering of Notes or the sale of Notes to one or more Agents
as principal shall be deemed to be a representation and warranty by the Company
to the Agents as to the matters covered thereby on the date of such
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certificate and, unless subsequently amended or supplemented, at each
Representation Date subsequent thereto.
SECTION 3. SOLICITATIONS AS AGENT; PURCHASES AS PRINCIPAL. (a)
SOLICITATIONS AS AGENT. On the basis of the representations and warranties
herein contained, but subject to the terms and conditions herein set forth, each
Agent agrees, as an agent of the Company, to use its reasonable efforts to
solicit offers to purchase the Notes upon the terms and conditions set forth
herein and in the Prospectus.
The Company reserves the right, in its sole discretion, to suspend
solicitation of purchases of the Notes through the Agents, as agents, commencing
at any time for any period of time or permanently. Upon receipt of instructions
from the Company by the Agents, the Agents will forthwith suspend solicitation
of purchases from the Company until such time as the Company has advised the
Agents that such solicitation may be resumed.
The Company agrees to pay each Agent a commission, in the form of a
discount, equal to the applicable percentage of the principal amount of each
Note sold by the Company as a result of a solicitation made by such Agent as set
forth in Schedule A hereto. To the extent permitted by Section l(a) hereof, the
Agents may reallow all or any portion of the commission payable pursuant hereto
to dealers or purchasers in connection with the offer and sale of any Notes.
The purchase price, interest rate or formula, maturity date and other
terms of the Notes shall be agreed upon by the Company and the applicable Agent
and set forth in a pricing supplement to the Prospectus to be prepared following
each acceptance by the Company of an offer for the purchase of Notes. Except as
may be otherwise provided in such pricing supplement to the Prospectus, the
Notes will be issued in denominations of U.S. $1,000 or any larger amount that
is an integral multiple of U.S. $1,000. All Notes sold through an Agent as
agent will be sold at 100% of their principal amount unless otherwise agreed to
by the Company and such Agent.
(b) PURCHASES AS PRINCIPAL. Each sale of Notes to one or more Agents
as principal shall be made in accordance with the terms contained herein and
(unless the Company and such Agent(s) shall otherwise agree) pursuant to a
separate agreement which will provide for the sale of such Notes to, and the
purchase and reoffering thereof by such Agent(s). Each such separate agreement
(which may be an oral agreement, confirmed in writing as promptly as practicable
as described below if requested by the Company, between the applicable Agent(s)
and the Company) is herein referred to as a "Terms Agreement". Unless the
context otherwise requires, each reference contained herein to "this Agreement"
shall be deemed to include any applicable Terms
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Agreement between the Company and the applicable Agent(s). Each such Terms
Agreement, whether oral (and, if requested by the Company, confirmed in
writing as promptly as practicable, which confirmation may be by facsimile
transmission or otherwise) or in writing, shall include such information (as
applicable) as is specified in Schedule B hereto. An Agent's commitment to
purchase Notes as principal pursuant to any Terms Agreement or otherwise
shall be deemed to have been made on the basis of the representations and
warranties of the Company herein contained and shall be subject to the terms
and conditions herein set forth. Each Terms Agreement shall specify the
principal amount of Notes to be purchased by the applicable Agent(s) pursuant
thereto, the price to be paid to the Company for such Notes (which, if not so
specified in a Terms Agreement, shall be at a discount equivalent to the
applicable commission set forth in Schedule A hereto), the time and place of
delivery of and payment for such Notes, any default provisions with respect
to Notes to be purchased by more than one Agent and such other provisions
(including further terms of the Notes) as may be mutually agreed upon. An
Agent may utilize a selling or dealer group in connection with the resale of
the Notes purchased and may offer all or any portion of the discount received
from the Company to such selling or dealer group. Such Terms Agreement shall
also specify the requirements for any officers' certificate, opinions of
counsel and "comfort" letters pursuant to (and consistent with) Sections
7(b), 7(c) and 7(d) hereof.
(c) ADMINISTRATIVE PROCEDURES. The Agents and the Company agree to
perform, and the Company agrees to cause the Trustee to agree to perform, the
respective duties and obligations specifically provided to be performed by them
in the Medium-Term Note Administrative Procedures (attached hereto as Exhibit A)
(the "Procedures"), as may hereafter be amended from time to time. The
Procedures may be amended only by written agreement between the Company and the
Agents.
SECTION 4. COVENANTS OF THE COMPANY. The Company covenants with the
Agents as follows:
(a) NOTICE OF CERTAIN EVENTS. The Company will notify the Agents
promptly, and confirm the notice in writing, of (i) the effectiveness of
any amendment to the Registration Statement, (ii) the transmittal to the
SEC for filing of any supplement to the Prospectus or any document that
would as a result thereof be incorporated by reference in the Prospectus
(other than a supplement relating to the offering of debt securities other
than the Notes), (iii) the receipt of any comments from the SEC with
respect to the Registration Statement or the Prospectus, (iv) any request
by the SEC for any amendment to the Registration Statement or any
supplement to the Prospectus or for additional information relating
thereto, (v) the issuance by the SEC of
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any stop order suspending the effectiveness of the Registration
Statement, and (vi) any withdrawal or lowering by Standard & Poor's
Ratings Group or Xxxxx'x Investors Service, Inc. of its rating of any
debt securities (including the Notes) of the Company or the public
announcement by any such rating agency that it has under surveillance or
review, with possible negative implications, its rating of any such debt
securities. Except as otherwise provided in subsection (k) of this
Section, the Company will use its reasonable best efforts to prevent the
issuance of any such stop order and, if any such order is issued, to
obtain the lifting thereof at the earliest possible moment.
(b) NOTICE OF CERTAIN PROPOSED FILINGS. Except as otherwise provided
in subsection (k) of this Section, the Company will give the Agents notice
of its intention to file or prepare any amendment to the Registration
Statement or any amendment or supplement to the Prospectus (other than an
amendment or supplement providing solely for a change in the interest rates
of Notes or an amendment or supplement relating to an offering of debt
securities other than the Notes), whether by the filing of documents
pursuant to the 1934 Act, the 1933 Act or otherwise, and will furnish the
Agents with copies of any such amendment or supplement or other documents
proposed to be filed or used a reasonable time in advance of such proposed
filing or use, as the case may be; PROVIDED that the requirements of this
paragraph shall not apply to the Company's proxy statement, its Annual
Report on Form 10-K, its Quarterly Reports on Form 10-Q or its Current
Reports on Form 8-K, so long as the Company shall furnish the Agents with
copies of such documents, upon request, after the date of filing thereof
with the SEC.
(c) COPIES OF THE REGISTRATION STATEMENT AND THE PROSPECTUS. The
Company will deliver to each Agent as many signed and conformed copies of
the Registration Statement (as originally filed) and of all amendments
thereto, whether filed before or after the Registration Statement becomes
effective, copies of all exhibits and documents filed therewith or
incorporated by reference therein as such Agent may reasonably request; and
the Company will furnish to each Agent as many copies of the Prospectus (as
amended or supplemented) as such Agent shall reasonably request so long as
such Agent is required to deliver a Prospectus in connection with sales or
solicitations of offers to purchase the Notes.
(d) PREPARATION OF PRICING SUPPLEMENTS. The Company will prepare,
with respect to any Notes to be sold through or to an Agent pursuant to
this Agreement, a pricing supplement to the Prospectus with respect to such
Notes in a form previously approved by the Agents and will file such
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pricing supplement pursuant to Rule 424(b)(3) under the 1933 Act not later
than the close of business of the SEC on the fifth business day after the
date on which such pricing supplement is first used.
(e) REVISIONS OF PROSPECTUS -- MATERIAL CHANGES. Except as otherwise
provided in subsection (k) of this Section, if at any time during the term
of this Agreement any event shall occur or condition exist as a result of
which it is necessary, in the reasonable opinion of counsel for the Agents
or counsel for the Company, to amend or supplement the Prospectus in order
that the Prospectus will not include an untrue statement of a material fact
or omit to state any material fact necessary in order to make the
statements therein not misleading in the light of the circumstances
existing at the time the Prospectus is delivered to a purchaser, or if it
shall be necessary, in the reasonable opinion of either such counsel, to
amend the Registration Statement or to amend or supplement the Prospectus
in order to comply with the requirements of the 1933 Act or the 1933 Act
Regulations, immediate notice shall be given, and confirmed in writing, to
the Agents to cease the solicitation of offers to purchase the Notes in
their capacity as agents and to cease sales of any Notes an Agent may then
own as principal pursuant to a Terms Agreement, and the Company will
promptly prepare and file, subject to Section 4(b) hereof, with the SEC
such amendment or supplement, whether by filing documents pursuant to the
1934 Act, the 1933 Act or otherwise, as may be necessary to correct such
untrue statement or omission or to make the Registration Statement and
Prospectus comply with such requirements.
(f) PROSPECTUS REVISIONS -- PERIODIC FINANCIAL INFORMATION. Except
as otherwise provided in subsection (k) of this Section, on the date of,
but not prior to, the release to the general public of interim financial
statement information related to the Company with respect to each of the
first three quarters of any fiscal year or preliminary financial statement
information with respect to any fiscal year, the Company shall furnish such
information to the Agents, confirmed in writing, and shall, subject to
Section 4(b) hereof and promptly following any such release, cause the
Prospectus to be amended or supplemented to include or incorporate by
reference financial information with respect thereto and corresponding
information for the comparable period of the preceding fiscal year, as well
as such other information and explanations as shall be necessary for an
understanding thereof or as shall be required by the 1933 Act or the 1933
Act Regulations.
13
(g) PROSPECTUS REVISIONS -- AUDITED FINANCIAL INFORMATION. Except as
otherwise provided in subsection (k) of this Section, on the date of, but
not prior to, the release to the general public of financial information
included in or derived from the audited financial statements of the Company
for the preceding fiscal year, the Company shall furnish such information
to the Agents, confirmed in writing, and shall, subject to Section 4(b)
hereof and promptly following any such release, cause the Registration
Statement and the Prospectus to be amended, whether by the filing of
documents pursuant to the 1934 Act, the 1933 Act or otherwise, to include
or incorporate by reference such audited financial statements and the
report or reports, and consent or consents to such inclusion or
incorporation by reference, of the independent accountants with respect
thereto, as well as such other information and explanations as shall be
necessary for an understanding of such financial statements or as shall be
required by the 1933 Act or the 1933 Act Regulations.
(h) EARNINGS STATEMENTS. The Company will make generally available
to its security holders as soon as practicable, but not later than 90 days
after the close of the period covered thereby, an earnings statement (in
form complying with the provisions of Rule 158 of the 1933 Act Regulations)
covering each twelve-month period beginning, in each case, not later than
the first day of the Company's fiscal quarter next following the "effective
date" (as defined in such Rule 158) of the Registration Statement with
respect to each sale of Notes.
(i) 1934 ACT FILINGS. During the period when the Prospectus is
required by the 1933 Act to be delivered in connection with sales of the
Notes, the Company will, subject to Section 4(b) hereof, file promptly all
documents required to be filed with the SEC pursuant to Section 13, 14 or
15(d) of the 1934 Act.
(j) STAND-OFF AGREEMENT. Except as may otherwise be provided in a
Terms Agreement, between the date of any Terms Agreement and the Settlement
Date with respect to such Terms Agreement, the Company will not, without
the prior written consent of the applicable Agent(s), offer or sell, or
enter into any agreement to sell, any debt securities issued or guaranteed
by the Company with comparable terms in any public offering (other than the
Notes that are to be sold pursuant to such Terms Agreement, commercial
paper in the ordinary course of business and tax-exempt securities).
(k) SUSPENSION OF CERTAIN OBLIGATIONS. The Company shall not be
required to comply with the provisions of the last sentence of subsection
(a) of this Section or with the
14
provisions of subsection (b), (e), (f) or (g) of this Section during any
period from the time (i) the Agents shall have suspended solicitation of
purchases of the Notes in their capacity as agents pursuant to a request
from the Company and (ii) none of the Agents shall then hold any Notes
as principal purchased pursuant to a Terms Agreement (or, if an Agent
holds Notes as principal pursuant to a Terms Agreement, such Agent has
held such Notes for more than 180 days), to the time the Company shall
determine that solicitation of purchases of the Notes should be resumed
or shall subsequently enter into a new Terms Agreement with such Agent.
SECTION 5. CONDITIONS OF OBLIGATIONS. The obligations of the Agents
to solicit offers to purchase the Notes as agents of the Company, the
obligations of any purchasers of the Notes sold through an Agent as agent, and
any obligation of an Agent to purchase Notes pursuant to a Terms Agreement or
otherwise will be subject to the accuracy of the representations and warranties
of the Company contained herein and to the accuracy of the statements of the
officers of the Company made in any certificate furnished pursuant to the
provisions hereof, to the performance and observance by the Company of all of
its covenants and agreements herein contained and to the following further
conditions precedent.
(a) LEGAL OPINIONS. On the date hereof, the Agents shall have
received the following legal opinions, dated as of the date hereof, in form and
substance reasonably satisfactory to the Agents:
(1) OPINION OF THE GENERAL COUNSEL OF THE COMPANY. The opinion of
the General Counsel of the Company, or other counsel reasonably
satisfactory to the Agents, substantially in the form attached hereto as
Exhibit B.
(2) OPINION OF SPECIAL COUNSEL TO THE COMPANY. The opinion of
Xxxxxxx & Xxxxx X.X.X., special counsel for the Company, as to matters of
New York law and the federal laws of the United States, to the effect that:
(i) Assuming the due authorization, execution and delivery of
the Designated Indenture by the Company and the Trustee, the
Designated Indenture constitutes a valid and legally binding agreement
of the Company, enforceable against the Company in accordance with its
terms, except to the extent that enforcement thereof may be limited by
bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium or other similar laws now or hereafter in effect relating
to or affecting enforcement of creditors' rights generally, except as
enforcement thereof is subject to general
15
principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law) and to governmental
authority that limits, delays or prohibits the making of payments
in foreign currency or currency units or payments outside the
United States, and except that the waiver set forth in Section 515
of the Indenture may be deemed unenforceable.
(ii) Assuming the due authorization, execution and delivery of
the Notes, the Notes, when authenticated and delivered pursuant to the
provisions of the Designated Indenture and this Agreement against
payment of the consideration therefor, will constitute valid and
legally binding obligations of the Company entitled to the benefits of
the Designated Indenture and will be enforceable against the Company
in accordance with their terms, except to the extent that enforcement
thereof may be limited by bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting enforcement of creditors'
rights generally and except as enforcement thereof is subject to
general principles of equity (regardless of whether enforcement is
considered in a proceeding in equity or at law) and to governmental
authority that limits, delays or prohibits the making of payments in
foreign currency or currency units or payments outside the United
States.
(iii) The Designated Indenture has been duly qualified under the
1939 Act.
(iv) The Notes and the Designated Indenture conform in all
material respects as to legal matters to the descriptions thereof
contained in the Prospectus.
(v) No authorization, approval or consent of any court or
governmental authority or agency is necessary in connection with the
issuance, sale, delivery and performance of the Notes hereunder or for
the execution, delivery or performance of the Designated Indenture by
the Company, except such as may be required under the 1933 Act, the
1939 Act, the 1933 Act Regulations or the 1939 Act Regulations or the
securities or "blue sky" laws of the various states.
(vi) The statements made in the Prospectus under the caption
"Description of Securities", "Description of Notes", and "United
States Taxation", to the extent that they constitute matters of law or
legal conclusions or summarize certain contracts, instruments
16
or documents, fairly and accurately present the information
disclosed therein in all material respects.
(vii) Based solely on written advice addressed to the Company by
the Commission, the Registration Statement has become effective under
the 1933 Act. To the best knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement is in
effect and no proceedings for that purpose have been instituted or are
pending or threatened under the 1933 Act.
(viii) The Registration Statement and the Prospectus,
excluding the documents incorporated by reference therein, and each
amendment or supplement thereto (except for the financial statements
and related schedules and other financial or statistical data included
in the Registration Statement and the Prospectus or omitted therefrom
and the Statement of Eligibility of the Trustee on Form T-1, as to
which such counsel need express no opinion), as of their respective
effective dates (or, in the case of registration statement no.
33-44153, as of the most recent Annual Report on Form 10-K filed by
the Company with the SEC) or issue dates, appear on their face to
comply as to form in all material respects to the requirements of the
1933 Act and the 1933 Act Regulations, and the Designated Indenture
filed with the SEC as an exhibit to the Registration Statement appears
on its face to comply as to form in all material respects to the
requirements of the 1939 Act and the 1939 Act Regulations.
(ix) Such counsel have reviewed the Registration Statement and
have participated in the preparation of the Prospectus and are
familiar with the documents incorporated by reference therein and no
facts have come to the attention of such counsel to lead them to
believe (A) that the Registration Statement (except for the financial
statements and related schedules and other financial data included or
incorporated by reference therein or omitted therefrom and the
Statement of Eligibility and Qualification of the Trustee on Form T-1,
as to which such counsel need express no opinion), at the time of the
most recent post-effective amendment to the Registration Statement or
at the time the most recent Annual Report on Form 10-K has been filed
by the Company with the SEC, whichever is later, at the time of
effectiveness of any new registration statement registering additional
Notes or at the date hereof, or (if such opinion is being delivered in
connection with a Terms Agreement pursuant
17
to Section 3(b) hereof) at the date of any Terms Agreement or at
the Settlement Date with respect thereto, as the case may be,
contained or contains an untrue statement of a material fact or
omitted or omits to state a material fact required to be stated
therein or necessary to make the statements therein not misleading
or (B) that the Prospectus, as amended or supplemented at the issue
date thereof or on the date hereof (except for the financial
statements and related schedules and other financial data included
or incorporated by reference therein or omitted therefrom, as to
which such counsel need express no opinion, and except to the
extent that any statement in the documents incorporated therein by
reference is modified or superseded in the Prospectus), or (if such
opinion is being delivered in connection with a Terms Agreement
pursuant to Section 3(b) hereof) at the date of any Terms Agreement
or at the Settlement Date with respect thereto, as the case may be,
included or includes an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to
make the statements therein, in light of the circumstances under
which they were made, not misleading.
In giving such opinion, such counsel may state in rendering their
opinion set forth in paragraphs (i) and (ii) above that, as of the date of
such opinion, a judgment for money in an action based on Notes payable in
foreign or composite currencies in a federal or state court in the United
States ordinarily would be enforced in the United States only in United
States dollars and that the date used to determine the rate of conversion
of the foreign or composite currency in which a particular Note is payable
into United States dollars will depend on various factors, including which
court renders the judgment. In giving such opinion, such counsel may
indicate that, insofar as such opinion involves factual matters, they have
relied, to the extent they deem proper, upon certificates of officers of
the Company and the Significant Subsidiaries and certificates of public
officials. Except as otherwise required in accordance with Section 7(c)
hereof, such counsel may also state that the opinions given do not address
any application of the Commodity Exchange Act, as amended, or the rules,
regulations or interpretations of the Commodity Futures Trading Commission
to Notes the payments of principal or interest on which will be determined
by reference to one or more currency exchange rates, commodity prices,
equity indices or other items.
(3) OPINION OF COUNSEL TO THE AGENTS. The opinion of Xxxxx & Wood
LLP, counsel to the Agents, as to matters of New York law and the federal
law of the United States,
18
covering the matters referred to in subparagraphs (a)(2)(i) to (iv) and
(a)(2)(vi) (except with respect to "United States Taxation") to (vii) of
this Section 5.
(b) OFFICERS' CERTIFICATE. On the date hereof, the Agents shall
have received a certificate of the Chief Executive Officer, the President or
any Vice President and the Vice President-Finance, the Treasurer or the Vice
President-General Counsel of the Company, dated as of the date hereof, to the
effect that (i) since the respective dates as of which information is given
in the Registration Statement and the Prospectus, other than as set forth or
incorporated by reference therein, there has not been any Material Adverse
Change, (ii) the representations and warranties of the Company contained in
Section 2 hereof are true and correct with the same force and effect as
though expressly made at and as of the date of such certificate, except to
the extent that such representations and warranties expressly relate to an
earlier date or later date (in which case such representations and warranties
are true and correct on and as of such earlier date or will be true and
correct on and as of such later date, as the case may be), (iii) the Company
has complied with all agreements and satisfied all conditions set forth
herein and in any applicable Terms Agreement on its part to be performed or
satisfied at or prior to the date of such certificate, and (iv) that no stop
order suspending the effectiveness of the Registration Statement is in effect
and no proceedings for that purpose have been initiated or, to the best of
such officers' knowledge, threatened by the SEC.
(c) COMFORT LETTERS. On the date hereof, the Agents shall have
received a "comfort" letter of KPMG Peat Marwick LLP, independent auditors of
the Company (as well as a "comfort letter" of each applicable accountant
covering financial statements of any entity other than the Company which are
included or incorporated by reference in the Registration Statement and the
Prospectus), dated as of the date hereof and in form and substance satisfactory
to the Agents, to the effect that:
(i) They are independent public accountants with respect to the
Company (or such other entity, as the case may be) and its subsidiaries
within the meaning of the 1933 Act and the applicable published 1933 Act
Regulations.
(ii) In their opinion, the consolidated financial statements of the
Company (or such other entity, as the case may be) and the related
financial statement schedules audited by them and included or incorporated
by reference in the Registration Statement and the Prospectus comply as to
form in all material respects with the applicable accounting requirements
of the 1933 Act and the 1934 Act and the related published rules and
regulations thereunder;
19
(iii) On the basis of procedures (but not an audit in accordance with
generally accepted auditing standards) consisting of a reading of the
latest available unaudited interim consolidated financial statements of the
Company included or incorporated by reference in the Registration Statement
and the Prospectus, a reading of the minutes of all meetings of the
shareholders, board of directors and committees of the board of directors
of the Company since the date of the latest audited consolidated financial
statements of the Company included or incorporated by reference in the
Registration Statement and the Prospectus, inquiries of certain officials
of the Company responsible for financial and accounting matters, any
limited review in accordance with standards established by the American
Institute of Certified Public Accountants with respect to the latest
unaudited consolidated financial statements included or incorporated by
reference in the Registration Statement and the Prospectus performed at the
request of the Company and such other inquiries and procedures as may be
specified in such letter, nothing came to their attention that caused them
to believe that:
(A) any material modifications should be made to the latest
unaudited consolidated financial statements included or incorporated
by reference in the Registration Statement and the Prospectus for them
to be in conformity with generally accepted accounting principles;
(B) the latest unaudited financial statements included or
incorporated by reference in the Registration Statement and the
Prospectus do not comply in form in all material respects with the
applicable accounting requirements of the 1933 Act and the 1934 Act
and the related published rules and regulations thereunder;
(C) at a specified date not more than five days prior to the
date of such letter, there was any change in the capital stock or any
increase in the long-term debt of the Company and consolidated
subsidiaries or any decreases in consolidated net current assets or
net assets, in each case as compared with amounts shown in the latest
balance sheet included or incorporated by reference in the
Registration Statement and the Prospectus, except in each case for
changes, decreases or increases that the Registration Statement and
the Prospectus disclose have occurred or may occur; or
(D) for the period from the date of the latest unaudited
consolidated financial statements included or incorporated by
reference in the Registration Statement
20
and the Prospectus to a specified date not more than five days
prior to the date of such letter, there was any decrease in
consolidated net sales, earnings from operations or in the total or
per-share amounts of net earnings, in each case as compared with
the corresponding period in the preceding year, except in each case
for any decreases that the Registration Statement and the
Prospectus disclose have occurred or may occur.
(iv) Although they are unable to and do not express any opinion on any
Pro Forma Condensed Balance Sheet or the Pro Forma Condensed Statement of
Operations (the "Pro Forma Statements") included or incorporated by
reference in the Registration Statement and the Prospectus or on the pro
forma adjustments applied to the historical amounts included in the Pro
Forma Statements, for purposes of such letter they have:
(a) read the Pro Forma Statements;
(b) made inquiries of certain officials of the Company who have
responsibility for financial and accounting matters about the basis
for their determination of the pro forma adjustments and whether the
Pro Forma Statements comply in form in all material respects with the
applicable accounting requirements of Rule 11-02 of Regulation S-X;
and
(c) proved the arithmetic accuracy of the application of the pro
forma adjustments to the historical amounts in the Pro Forma
Statements; and
on the basis of such procedures, and such other inquiries and procedures as
may be specified in such letter, nothing came to their attention that
caused them to believe that the Pro Forma Statements included or
incorporated by reference in the Registration Statement and the Prospectus
do not comply in form in all material respects with the applicable
accounting requirements of Rule 11-02 of Regulation S-X and that the pro
forma adjustments have not been properly applied to the historical amounts
in the compilation of those statements; and
(v) They have performed other specified procedures, not constituting
an audit, with respect to certain amounts, percentages, numerical data and
financial information included or incorporated by reference in the
Registration Statement, which have previously been specified by you and
which shall be specified in such letter, and have compared certain of such
items with, and have found such items to be
21
in agreement with, the accounting and financial records of the Company.
(d) RATINGS. The Notes shall have been rated BBB and Baa2 by
Standard & Poor's Ratings Services and Xxxxx'x Investment Service, Inc.
respectively, or such other ratings as the Company shall have notified the
Agents of pursuant to Section 4(a) hereof and written confirmation of such
ratings, dated each Settlement Date shall have been delivered to the Agents.
(e) OTHER DOCUMENTS. On the date hereof and on each Settlement Date
with respect to any applicable Terms Agreement, counsel to the Agents shall have
been furnished with such documents and opinions as such counsel may reasonably
require for the purpose of enabling such counsel to pass upon the issuance and
sale of Notes as herein contemplated and related proceedings, or in order to
evidence the accuracy and completeness of any of the representations and
warranties, or the fulfillment of any of the conditions, herein contained; and
all proceedings taken by the Company in connection with the issuance and sale of
Notes as herein contemplated shall be reasonably satisfactory in form and
substance to the Agents and to counsel to the Agents.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, this Agreement (or, at the
option of the applicable Agent, any applicable Terms Agreement) may be
terminated by an Agent by notice to the Company at any time and any such
termination shall be without liability of any party to any other party, except
that the covenant regarding provision of an earnings statement set forth in
Section 4(h) hereof, the provisions concerning payment of expenses under Section
10 hereof, the indemnity and contribution agreement set forth in Sections 8 and
9 hereof, the provisions concerning the representations, warranties and
agreements to survive delivery of Section 11 hereof, the governing law
provisions set forth in Section 14 hereof and the provisions set forth under
"Parties" of Section 15 hereof shall remain in effect.
SECTION 6. DELIVERY OF AND PAYMENT FOR NOTES SOLD THROUGH THE AGENTS.
Delivery of Notes sold through an Agent as agent shall be made by the Company to
such Agent or its nominee for the account of any purchaser only against payment
therefor in immediately available funds. In the event that a purchaser shall
fail either to accept delivery of or to make payment for a Note on the date
fixed for settlement, the applicable Agent shall promptly notify the Company and
deliver such Note to the Company, and, if such Agent has theretofore paid the
Company for such Note, the Company will promptly return such funds to such
Agent. If such failure occurred for any reason other than default by such Agent
in the performance of its obligations hereunder, the Company will reimburse such
Agent on an equitable basis for its
22
loss of the use of the funds for the period such funds were credited to the
Company's account.
SECTION 7. ADDITIONAL COVENANTS OF THE COMPANY. The Company
covenants and agrees with the Agents that:
(a) REAFFIRMATION OF REPRESENTATIONS AND WARRANTIES. Each acceptance
by it of an offer for the purchase of Notes (whether through an Agent as
agent or to an Agent as principal), and each delivery of Notes by the
Company (whether through an Agent as agent or to an Agent as principal),
shall be deemed to be an affirmation that the representations and
warranties of the Company contained in this Agreement and in any
certificate theretofore delivered to the Agents pursuant hereto are true
and correct at the time of such acceptance or sale, as the case may be, and
an undertaking that such representations and warranties will be true and
correct at the time of delivery to the purchaser or his or her agent, or to
the Agents, of the Note or Notes relating to such acceptance or sale, as
the case may be, as though made at and as of each such time (it being
understood that such representations and warranties shall relate to the
Registration Statement and Prospectus as amended and supplemented to each
such time).
(b) SUBSEQUENT DELIVERY OF CERTIFICATES. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by an amendment or supplement providing solely for a change in
the interest rates of Notes or similar changes, and, unless the Agents
shall otherwise reasonably specify, other than by an amendment or
supplement that relates exclusively to an offering of debt securities other
than the Notes), (ii) there is filed with the SEC any document incorporated
by reference into the Prospectus (other than any proxy statement or Current
Report on Form 8-K relating exclusively to the issuance of debt securities
other than the Notes or, unless the Agents shall otherwise reasonably
specify, any other Report on Form 8-K), (iii) (if required pursuant to the
terms of a Terms Agreement) the Company sells Notes to one or more Agents
pursuant to a Terms Agreement or (iv) the Company shall approve a form of
Note for sale whose principal, premium, if any, or interest is determined
by reference to any index, formula or other method (collectively, "Indexed
Notes"), the Company shall furnish or cause to be furnished to the Agents
forthwith a certificate dated the date of filing with the SEC of such
supplement or document, the date of effectiveness of such amendment, or the
date of such sale, as the case may be, in form satisfactory to the Agents,
to the effect that the statements contained in the certificate referred to
in Section 5(b) hereof which were last furnished to the Agents
23
are true and correct at the time of such amendment, supplement, filing
or sale, as the case may be, as though made at and as of such time
(except that such statements shall be deemed to relate to the
Registration Statement and the Prospectus as amended and supplemented to
such time and provided that, if such certificate is provided on the date
of sale pursuant to a Terms Agreement, such certificate shall, in lieu
of the statement required in Section 5(b)(i) hereof, state that since
the date of the applicable Terms Agreement there has not been any
Material Adverse Change) or, in lieu of such certificate, a certificate
of the same tenor as the certificate referred to in said Section 5(b),
modified as necessary to relate to the Registration Statement and the
Prospectus as amended and supplemented to the time of delivery of such
certificate; PROVIDED, HOWEVER, that, if the Agents shall have suspended
solicitation of purchases of the Notes in their capacity as agents
pursuant to a request from the Company, and none of the Agents shall
then hold any Notes as principal purchased pursuant to a Terms Agreement
(or if any Agent holds Notes as principal pursuant to a Terms Agreement,
such Agent has held such Notes for more than 180 days), the Company
shall not be obligated so to furnish the Agents with a certificate or
certificates until such time that the Company shall determine that
solicitation of purchases of the Notes should be resumed or shall
subsequently enter into a new Terms Agreement with one or more Agents.
(c) SUBSEQUENT DELIVERY OF LEGAL OPINIONS. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by an amendment or supplement providing solely for a change in
the interest rates of the Notes or similar changes or solely for the
inclusion of additional financial information, and, unless the Agents shall
otherwise reasonably specify, other than by an amendment or supplement that
relates exclusively to an offering of debt securities other than the
Notes), (ii) there is filed with the SEC any document incorporated by
reference into the Prospectus (other than any proxy statement or Current
Report on Form 8-K relating exclusively to the issuance of debt securities
other than the Notes or to quarterly or annual financial information that
has been announced to the general public or, unless the Agents shall
otherwise reasonably request, any other Current Report on Form 8-K or any
Quarterly Report on Form 10-Q), (iii) (if required pursuant to the terms of
a Terms Agreement) the Company sells Notes to one or more Agents pursuant
to a Terms Agreement or (iv) the Company shall approve a form of Indexed
Note for sale, the Company shall furnish or cause to be furnished forthwith
to the Agents and to counsel to the Agents a written opinion of counsel
reasonably satisfactory to the Agents, dated the date of filing with the
SEC of such
24
supplement or document, the date of effectiveness of such amendment, or
the date of such sale, as the case may be, in form and substance
satisfactory to the Agents, of the same tenor as the opinions referred
to in Sections 5(a)(1) and (2) hereof, but modified, as necessary, to
relate to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such opinion or, in lieu of any
such opinion, counsel last furnishing such opinion to the Agents shall
furnish the Agents with a letter to the effect that the Agents may rely
on such last opinion to the same extent as though it was dated the date
of such letter authorizing reliance (except that statements in such last
opinion shall be deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented to the time of delivery of such
letter authorizing reliance); PROVIDED, HOWEVER, that, in the event that
an Indexed Note has been approved for sale by the Company, counsel to
the Company shall also confirm the exclusion or exemption of such
Indexed Note from the Commodity Exchange Act and the rules and
regulations promulgated thereunder; and PROVIDED, FURTHER, that, if the
Agents shall have suspended solicitation of purchases of the Notes in
their capacity as agents pursuant to a request from the Company, and
none of the Agents shall then hold any Notes as principal purchased
pursuant to a Terms Agreement (or, if any Agent holds Notes as principal
pursuant to a Terms Agreement, such Agent has held such Notes for more
than 180 days), the Company shall not be obligated so to furnish the
Agents with opinions until such time that the Company shall determine
that solicitation of purchases of the Notes should be resumed or shall
subsequently enter into a new Terms Agreement with one or more Agents.
(d) SUBSEQUENT DELIVERY OF COMFORT LETTERS. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented
to include additional financial information, (ii) there is filed with the
SEC any document incorporated by reference into the Prospectus that
contains additional financial information (other than any Current Report on
Form 8-K relating to quarterly or annual earnings) or (iii) (if required
pursuant to the terms of a Terms Agreement) the Company sells Notes to one
or more Agents pursuant to a Terms Agreement, the Company shall cause KPMG
Peat Marwick LLP (as well as any other accountant referred to in Section
5(c) for so long as their consent to the inclusion of their report on the
related financial statements is required) forthwith to furnish the Agents
with a letter, dated the date of effectiveness of such amendment,
supplement or document with the SEC or the date of such sale, as the case
may be, in form satisfactory to the Agents, of the same tenor as the
portions of its letter referred to in Section 5(c)(i) and (ii) hereof but
modified
25
to relate to the Registration Statement and Prospectus, as amended and
supplemented to the date of such letter, and of the same general tenor
as the portions of its letter referred to in Section 5(c)(iii) and (iv)
hereof with such changes as may be necessary to reflect changes in the
financial statements and other information derived from the accounting
records of the Company; PROVIDED, HOWEVER, that, if the Registration
Statement or the Prospectus is amended or supplemented solely to include
financial information as of and for a fiscal quarter, KPMG Peat Marwick
LLP (as well as any other accountant referred to in Section 5(c) for so
long as their consent to the inclusion of their report on the related
financial statements is required) may limit the scope of its letter to
the unaudited financial statements included in such amendment or
supplement, unless any other information included therein of an
accounting, financial or statistical nature is of such a nature that, in
the reasonable judgment of the Agents, such letter should cover such
other information; and PROVIDED, FURTHER, that, if the Agents shall have
suspended solicitation of purchases of the Notes in their capacity as
agents pursuant to a request from the Company, and none of the Agents
shall then hold any Notes as principal purchased pursuant to a Terms
Agreement (or, if any Agent holds Notes as principal pursuant to a Terms
Agreement, such Agent has held such Notes for more than 180 days), the
Company shall not be obligated so to furnish the Agents with a letter or
letters until such time that the Company shall determine that
solicitation of purchases of the Notes should be resumed or shall
subsequently enter into a new Terms Agreement with one or more Agents.
SECTION 8. INDEMNIFICATION. (a) The Company agrees to indemnify and
hold harmless the Agents and each person, if any, who controls an Agent within
the meaning of Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of an untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), including all documents incorporated therein by
reference, or the omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statements therein
not misleading or arising out of an untrue statement or alleged untrue
statement of a material fact included in any preliminary prospectus,
preliminary prospectus supplement or the Prospectus (or any amendment or
supplement thereto) or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
26
light of the circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, if such settlement is effected with
the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred (including
the reasonable fees and disbursements of counsel chosen by the Agents,
subject to subsection (c) of this Section 8), reasonably incurred in
investigating, preparing or defending against any litigation, or
investigation or proceeding by any governmental agency or body, commenced
or threatened, or any claim whatsoever based upon any such untrue statement
or omission, or any such alleged untrue statement or omission, to the
extent that any such expense is not paid under subparagraph (i) or (ii)
above;
PROVIDED, HOWEVER, that this indemnity does not apply to any loss, liability,
claim, damage or expense to the extent arising out of an untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in
conformity with written information furnished to the Company by the Agents
expressly for use in the Registration Statement (or any amendment thereto) or
any preliminary prospectus, preliminary prospectus supplement or the Prospectus
(or any amendment or supplement thereto) or in the Form T-1 or any amendment or
supplement thereto filed by the Trustee with the Commission; PROVIDED, FURTHER
that the foregoing indemnification with respect to any preliminary prospectus or
preliminary prospectus supplement shall not apply to any loss, liability, claim,
damage or expense asserted against an Agent by a person who purchased the Notes
(whether from such Agent as agent or from such Agent as principal) and is
asserting such loss, liability, claim, damage or expense, if a copy of the
Prospectus (as then amended or supplemented if the Company shall have furnished
any amendments or supplements thereto to such Agent in a timely manner) was not
sent or given by or on behalf of such Agent to such person, if such is required
by law, at or prior to the written confirmation of the sale of such Notes to
such person and if the Prospectus (as so amended or supplemented) would have
cured the untrue statement or omission or alleged untrue statement or omission
giving rise to such loss, liability, claim, damage or expense.
(b) INDEMNIFICATION OF COMPANY. Each Agent agrees to indemnify and
hold harmless the Company, its directors, each of
27
its officers who signed the Registration Statement, and each person, if any,
who controls the Company within the meaning of Section 15 of the 1933 Act
against any and all loss, liability, claim, damage and expense described, and
to the same extent as, in the indemnity contained in Section 8(a), as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendment thereto) or any preliminary prospectus, preliminary prospectus
supplement or the Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Company by such Agent expressly for use in the Registration Statement (or any
amendment thereto) or such preliminary prospectus, preliminary prospectus
supplement or the Prospectus (or any amendment or supplement thereto).
(c) GENERAL. Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, but failure to so notify an indemnifying
party shall not relieve it from any liability which it may have otherwise than
on account of this indemnity agreement. Upon receipt of notice of such action
from the indemnified party, the indemnifying party may assume the defense of any
such action, including the employment of counsel reasonably satisfactory to the
indemnified party and the payment of all expenses related thereto. In the event
that the indemnifying party assumes the defense of such action as provided in
the foregoing sentence, each indemnified party shall have the right to employ
separate counsel in any such action and to participate in the defense thereof,
but the fees and expenses of such counsel shall be at the expense of such
indemnified party unless (a) the indemnifying party has separately agreed in
writing to pay such fees and expenses or (b) the indemnifying party shall have
failed to assume the defense of such action or proceeding and employ counsel
reasonably satisfactory to such person in any such action or proceeding or (c)
the named parties to any such action or proceeding (including any impleaded
parties) include both such indemnified party and the indemnifying party, and
such indemnified party shall have been advised by their own counsel that there
are potential material conflicts of interest between such indemnified party and
the indemnifying party, in which case if such person notifies the indemnifying
party in writing that such indemnified party elects to employ separate counsel
at the expense of the indemnifying party, the indemnifying party shall not have
the right to assume the defense of such action or proceeding on behalf of such
indemnified party. In no event shall the indemnifying party or parties be
liable for the fees and expenses of more than one counsel for all indemnified
parties in connection with any one action or separate but similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances. An indemnified party under subsection (a) or (b) above shall not
enter into a settlement of
28
any litigation in respect of which a claim is to be made against the
indemnifying party under such subsection unless such settlement is effected
with the consent of the indemnifying party.
(d) PAYMENTS. If at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified party for fees and
expenses of counsel, such indemnifying party agrees that it shall be liable for
any settlement of the nature contemplated by subparagraph (a)(ii) of this
Section 8 effected without its written consent if (i) such settlement is entered
into more than 45 days after receipt by such indemnifying party of the aforesaid
request, (ii) such indemnifying party shall have received notice of the terms of
such settlement at least 30 days prior to such settlement being entered into and
(iii) such indemnifying party shall not have reimbursed such indemnified party
in accordance with such request prior to the date of such settlement.
SECTION 9. CONTRIBUTION. If the indemnification provided for in
Section 8 hereof, although applicable in accordance with its terms, is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall contribute to the aggregate amount
of such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand and the
applicable Agent(s) on the other hand from the offering of the Notes that were
the subject of the claim for indemnification or (ii) if the allocation provided
by clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company on the one hand and each such
Agent on the other hand in connection with the statements or omissions which
resulted in such losses, liabilities, claims, damages or expenses, as well as
any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and the
applicable Agent(s) on the other hand in connection with the offering of the
Notes that were the subject of the claim for indemnification shall be deemed to
be in the same respective proportions as the total net proceeds from the sale of
such Notes (before deducting expenses) received by the Company and the total
discount or commission received by each such Agent, as the case may be, bears to
the aggregate initial offering price of such Notes.
The relative fault of the Company on the one hand and the applicable
Agent(s) on the other hand shall be determined by reference to, among other
things, whether any such untrue or
29
alleged untrue statement of a material fact or omission or alleged omission
to state a material fact relates to information supplied by the Company or by
the applicable Agent(s) and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or
omission.
The Company and the Agents agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro rata
allocation (even if the applicable Agent(s) were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 9. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 9 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue or alleged untrue
statement or omission or alleged omission.
Notwithstanding the provisions of this Section 9, (i) no Agent shall
be required to contribute any amount in excess of the total discount or
commission received by such Agent in connection with the offering of the Notes
that were the subject of the claim for indemnification and (ii) no person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the 1933
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. In addition, in connection with an offering
of Notes purchased by two or more Agents as principal, the respective
obligations of such Agents to contribute pursuant to this Section 9 are several,
and not joint, in proportion to the aggregate initial offering price of Notes
that each such Agent has agreed to purchase from the Company.
For purposes of this Section 9, each person, if any, who controls an
Agent within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934
Act shall have the same rights to contribution as such Agent, and each director
of the Company, each officer of the Company and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company.
SECTION 10. PAYMENT OF EXPENSES. The Company will pay all expenses
incident to the performance of its obligations under this Agreement, including:
30
(a) The preparation and filing of the Registration Statement and all
amendments thereto and the Prospectus and any amendments or supplements
thereto;
(b) The printing, filing and reproduction of this Agreement;
(c) The preparation, printing, issuance and delivery of the Notes,
including any fees and expenses relating to the use of global Notes;
(d) The fees and disbursements of the Company's accountants and
counsel, of the Trustee and its counsel, and of any calculation agent or
exchange rate agent;
(e) The reasonable fees and disbursements of counsel to the Agents
incurred from time to time in connection with the transactions contemplated
hereby;
(f) The printing and delivery to the Agents in quantities as
hereinabove stated of copies of the Registration Statement and any
amendments thereto and of the Prospectus and any amendments or supplements
thereto, and the delivery by the Agents of the Prospectus and any
amendments or supplements thereto in connection with solicitations or
confirmations of sales of the Notes;
(g) The preparation, printing, reproducing and delivery to the Agents
of copies of the Designated Indenture and all supplements and amendments
thereto;
(h) Any fees charged by rating agencies for the rating of the Notes;
(i) The fees and expenses, if any, incurred in connection with any
listing of the Notes on any securities exchange;
(j) The filing fees, if any, incurred with respect to any filing with
the National Association of Securities Dealers, Inc.;
(k) Any advertising and other out-of-pocket expenses of the Agents
incurred with the written approval of the Company;
(l) The cost of preparing, and providing any CUSIP or other
identification numbers for, the Notes; and
(m) The fees and expenses of any Depositary (as defined in the
Indenture) and any nominees thereof in connection with the Notes.
31
SECTION 11. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE
DELIVERY. The representations, warranties, indemnities, agreements and other
statements of the Company and the indemnities, agreements and other statements
of an Agent set forth in or made pursuant to this Agreement will remain
operative and in full force and effect regardless of any investigation made by
or on behalf of the Company or an Agent or controlling person and shall survive
each delivery of and payment for the Notes.
SECTION 12. TERMINATION. (a) TERMINATION OF THIS AGREEMENT. This
Agreement (excluding any Terms Agreement) may be terminated for any reason, at
any time by either the Company or an Agent (as to itself) upon the giving of 21
days' written notice of such termination to the other party hereto.
(b) TERMINATION OF A TERMS AGREEMENT. The applicable Agent(s) may
terminate any Terms Agreement, immediately upon notice to the Company, at any
time prior to the Settlement Date relating thereto (i) if there has been, since
the date of such Terms Agreement, any Material Adverse Change which, in any such
case, in the judgment of such Agent(s), makes it impractical to market the
related Notes or (ii) if there has occurred any outbreak of new hostilities or
escalation of existing hostilities or other national or international calamity
or crisis the effect of which on the financial markets of the United States is
such as to make it, in the judgment of such Agent(s), impracticable to market
the related Notes or enforce contracts for the sale of such Notes or (iii) if
trading in any securities of the Company has been suspended by the SEC or any
exchange on which such securities are listed, or if trading generally on the New
York Stock Exchange or in a national over-the-counter market has been suspended,
or minimum or maximum prices for trading have been fixed, or maximum ranges for
prices for securities have been required, by such exchange or by order of the
SEC, any exchange on which such securities are listed or any other governmental
authority or (iv) if a banking moratorium has been declared by either federal or
New York authorities or if a banking moratorium shall have been declared by the
relevant authorities in the country or countries of origin of any foreign
currency or currencies in which the related Notes are denominated or payable or
(v) if the rating assigned by Xxxxx'x Investors Service, Inc. or Standard &
Poor's Ratings Group to any debt securities (including the Notes) of the Company
as of the date of any applicable Terms Agreement shall have been lowered since
that date or if any such rating agency shall have publicly announced that it has
under surveillance or review, with possible negative implications, its rating of
any such debt securities, or (vi) if there shall have come to the attention of
such Agent(s) any facts that would cause such Agent(s) to reasonably believe
that the Prospectus, at the time it was required to be delivered to a purchaser
of the related Notes, included an untrue statement of a material fact or omitted
to state a material fact necessary in
32
order to make the statements therein, in light of the circumstances existing
at the time of such delivery, not misleading.
(c) GENERAL. In the event of any such termination, neither party
will have any liability to the other party hereto, except that (i) each Agent
shall be entitled to any commission earned prior to such termination in
accordance with the third paragraph of Section 3(a) hereof, (ii) if at the time
of termination (A) an Agent shall own any Notes purchased pursuant to a Terms
Agreement with the intention of reselling them or (B) an offer to purchase any
of the Notes has been accepted by the Company but the time of delivery to the
purchaser or his agent of the Note or Notes relating thereto has not occurred,
the covenants set forth in Sections 4 and 7 hereof shall remain in effect until
such Notes are so resold or delivered, as the case may be, and (iii) the
covenant set forth in Section 4(h) hereof, the provisions of Section 5 hereof,
the indemnity and contribution agreements set forth in Sections 8 and 9 hereof,
and the provisions of Sections 11, 14 and 15 hereof shall remain in effect.
SECTION 13. NOTICES. Unless otherwise provided herein, all notices
required under the terms and provisions hereof shall be in writing, either
delivered by hand, by mail or by telex, telecopier or telegram, and any such
notice shall be effective when received at the address specified below.
If to the Company:
Xxxxxx & Xxxxx Corporation
0000 X&X Xxxxxxxxx
Xxxxxxx, Xxxxxxxxx 00000
Attention: Vice President-General Counsel
If to the Agents:
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
North Tower - 10th Floor
World Financial Center
New York, New York 10281
Attention: MTN Product Management
Xxxxxxxxx Xxxxxx & Xxxxxxxx
Securities Corporation
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxxx
X.X. Xxxxxx Securities Inc.
33
00 Xxxx Xxxxxx - 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Medium-Term Note Desk
Xxxxxx Xxxxxxx & Co. Incorporated
1585 Broadway - 2nd Floor
New York, New York 10036
Attention: Manager-Continuously Offered Products
with a copy to:
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx - 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxx-Investment Banking
Information Center
or at such other address as such party may designate from time to time by notice
duly given in accordance with the terms of this Section 13.
SECTION 14. GOVERNING LAW. This Agreement and all the rights and
obligations of the parties shall be governed by and construed in accordance with
the laws of the State of New York.
SECTION 15. PARTIES. This Agreement shall inure to the benefit of
and be binding upon the Agents and the Company and their respective successors.
Nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any person, firm or corporation, other than the parties hereto
and their respective successors and the controlling persons and officers and
directors referred to in Sections 8 and 9 and their theirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. This Agreement and
all conditions and provisions hereof are intended to be for the sole and
exclusive benefit of the parties hereto and respective successors and said
controlling persons and officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation.
No purchaser of Notes shall be deemed to be successor by reason merely of such
purchase.
SECTION 16. COUNTERPARTS. This Agreement may be executed in one or
more counterparts and when a counterpart has been executed by each party, all
such counterparts taken together shall constitute one and the same agreement.
SECTION 17. HEADINGS. All headings of the sections and subparts
thereof of this Agreement are for convenience of reference only and shall not be
deemed a part of this Agreement or the applicable Agreement.
34
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us counterparts hereof, whereupon this
instrument along with all counterparts will become a binding agreement between
the Agents and the Company in accordance with its terms.
Very truly yours,
XXXXXX & XXXXX CORPORATION
By: /s/ XXXX X. XXXXX
----------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President-Finance
and Treasurer
Confirmed and accepted as of the
date first above written:
XXXXXXX LYNCH, XXXXXX, XXXXXX & XXXXX
INCORPORATED
By: /s/ XXXXX XXXXXXXXX
------------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Vice President
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
By: /s/ XXXXX XXXXXXXX
------------------------------------
Name: Xxxxx Xxxxxxxx
Title:
X.X. XXXXXX SECURITIES INC.
By: /s/ X.X. XXXXX
------------------------------------
Name: X.X. Xxxxx
Title:
XXXXXX XXXXXXX & CO. INCORPORATED
By: /s/ XXXX XXXXX
------------------------------------
Name: Xxxx Xxxxx
Title: Vice President
35
EXHIBIT A
MEDIUM-TERM NOTE ADMINISTRATIVE PROCEDURES
(DATED AS OF FEBRUARY 10, 1998)
Medium-Term Notes (the "Notes") in the aggregate principal amount of
up to U.S. $175,000,000 are to be offered on a continuing basis by Xxxxxx &
Xxxxx Corporation (the "Company") through Xxxxxxx Xxxxx & Co., Xxxxxxx Lynch,
Xxxxxx, Xxxxxx & Xxxxx Incorporated, Xxxxxxxxx Xxxxxx & Xxxxxxxx Securities
Corporation, X.X. Xxxxxx Securities Inc. and Xxxxxx Xxxxxxx & Co. Incorporated
who, as agents (the "Agents"), have agreed to use their reasonable best efforts
to solicit offers to purchase the Notes from the Company. The Agents may also
purchase Notes as principals for resale.
The Notes are being sold pursuant to a Distribution Agreement between
the Company and the Agents, dated February 10, 1998 (the "Distribution
Agreement"). The Notes will be issued pursuant to an Indenture dated as of
January 15, 1992, as supplemented by a First Supplemental Indenture dated as of
July 28, 1992 and a Second Supplemented Indenture dated as of February 10, 1998
(collectively, the "Indenture"), between the Company and The Chase Manhattan
Bank as trustee (successor trustee to Xxxxxx Guaranty Trust Company of New York)
(the "Trustee"). A Registration Statement (the "Registration Statement", which
term shall include any amendments or supplements thereto, and any additional
registration statements filed in connection with the Notes as provided in the
introductory paragraph of the Distribution Agreement) with respect to the Notes
has been filed with the Securities and Exchange Commission (the "Commission").
The basic Prospectus in the form included in the Registration Statement, as
amended, is herein referred to as the "Prospectus". The Prospectus, as
supplemented with respect to the Notes, is herein referred to as the "Prospectus
Supplement". The most recent supplement to the Prospectus with respect to the
specific terms of the Notes is herein referred to as the "Pricing Supplement".
The Notes will either be issued (a) in book-entry form and represented
by one or more fully registered Notes (each, a "Book-Entry Note") delivered to
the Trustee, as agent for The Depository Trust Company ("DTC") and recorded in
the book-entry system maintained by DTC, or (b) in certificated form delivered
to the purchaser thereof or a person designated by such purchaser. Owners of
beneficial interests in Notes issued in book-entry form will be entitled to
physical delivery of Notes in certificated form equal in principal amount to
their respective
A-1
beneficial interests only upon certain limited circumstances described in the
Prospectus Supplement.
General procedures relating to the issuance of all Notes are set forth in
Part I hereof. Additionally, Notes issued in book-entry form will be issued in
accordance with the procedures set forth in Part II hereof and Notes issued in
certificated form will be issued in accordance with the procedures set forth in
Part III hereof. Capitalized terms used herein that are not otherwise defined
shall have the meanings ascribed thereto in the Indenture or the Notes, as the
case may be.
PART I: PROCEDURES OF GENERAL APPLICABILITY
Date of Issuance/
Authentication: Each Note will be dated as of the date of its authentication
by the Trustee. Each Note shall also bear an original issue
date (the "Original Issue Date"). The Original Issue Date
shall remain the same for all Notes subsequently issued upon
transfer, exchange or substitution of an original Note
regardless of their dates of authentication.
Maturity: Each Note will mature on a date selected by the Purchaser
and agreed to by the Company that is not less than nine
months nor more than thirty years from its Original Issue
Date.
Registration: Notes will be issued only in fully registered form.
Currencies: Each Note shall be denominated in U.S. dollars or such
foreign currency or currency unit as determined by the
Company and as specified in the applicable Pricing
Supplement.
Redemption/
Repayment: If indicated in the applicable Pricing Supplement, the Notes
of a particular tenor will be subject to redemption in whole
or in part, at the option of the Company, on and after an
initial redemption date as set forth in the applicable
Pricing Supplement and in the applicable Note. The
redemption price will be set forth in the applicable Pricing
Supplement and in the applicable Note.
A-2
If indicated in the applicable Pricing Supplement, the Notes
of a particular tenor will be subject to repayment at the
option of the holders thereof in accordance with the terms
of the Notes on a repayment date as set forth in the
applicable Pricing Supplement and in the applicable Note.
The repayment date or dates and the repayment price will be
set forth in the applicable Pricing Supplement and in the
applicable Note.
Calculation of
Interest: Interest (including payments for partial periods) will be
calculated and paid on the basis of a 360-day year of twelve
30-day months.
Acceptance and
Rejection of
Offers: The Company shall have the sole right to accept offers to
purchase Notes from the Company and may reject any such
offer in whole or in part. The Agents shall communicate to
the Company, orally or in writing, each reasonable offer to
purchase Notes from the Company received by them. The
Agents shall have the right, in their discretion reasonably
exercised, without notice to the Company, to reject any
offer to purchase Notes through them in whole or in part.
Preparation of
Pricing
Supplement: If any offer to purchase a Note is accepted by the Company,
the Company, with the approval of the Agents, will prepare a
Pricing Supplement reflecting the terms of such Note and
file 10 copies of such Pricing Supplement relating to the
Notes with the Commission in accordance with the Rule 424
under the Securities Act of 1933, as amended. The Agents
will cause the Pricing Supplement to be affixed to the
Prospectus Supplement (together, the "Supplemented
Prospectus") and cause a Supplemented Prospectus to be
delivered to the purchaser of the Note.
Pricing
Supplement
Instructions: The Company shall deliver a completed Pricing Supplement,
via next day mail or telecopy to
A-3
arrive no later than 11 a.m. on the Business Day
following the trade date, to the Agents at the following
locations:
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
North Tower, 10th Floor
World Financial Center
New York, New York 10281
Attn: MTN Product Management
Phone: (000) 000-0000
Fax: (000) 000-0000
Xxxxxxxxx Xxxxxx & Xxxxxxxx
Securities Corporation
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxxxxxx
Phone: (000) 000-0000
Fax: (000) 000-0000
X.X. Xxxxxx Securities Inc.
00 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Medium-Term Note Desk
Phone: (000) 000-0000
Fax: (000) 000-0000
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx, 0xx Xxxxx
Xxx Xxxx, New York 10036
Attn: Manager, Continuously Offered
Products
Phone: (000) 000-0000
Fax: (000) 000-0000
and, for recordkeeping purposes, the Company shall also send
a copy to:
Xxxxxx Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx, 00000
Attn: Xxxxx Xxxxxx, Investment Banking
Information Center
Phone: (000) 000-0000
Fax: (000) 000-0000
In each instance that a Pricing Supplement is prepared, the
Agents will affix the Pricing Supplement to the Prospectus
Supplements prior to their use. Outdated Pricing
A-4
Supplements and the Prospectus Supplements to which they are
attached (other than those retained for files) will be
destroyed.
Settlement: The receipt of immediately available funds by the Company in
payment for a Note and the authentication and delivery of
such Note shall, with respect to such Note, constitute
"settlement". Offers accepted by the Company will be
settled on the third Business Day after the acceptance of
such offer, or at a time as the purchaser and the Company
shall agree, pursuant to the timetable for settlement set
forth in Parts II and III hereof under "Settlement
Procedures" with respect to Book-Entry Notes and
Certificated Notes, respectively. If procedures A and B of
the applicable "Settlement Procedures" with respect to a
particular offer are not completed on or before the time set
forth under the applicable "Settlement Procedures
Timetable", such offer shall not be settled until the
Business Day following the completion of Settlement
Procedures A and B or such later date as the purchaser and
the Company shall agree.
In the event of a purchase of Notes by the Agents as
principal, appropriate settlement details will be as agreed
between the Agents and the Company pursuant to the
applicable Terms Agreement.
Procedure for
Changing Rates
or Other
Variable Terms: When a decision has been reached to change the interest rate
or any other variable term on any Notes being sold by the
Company, the Company will promptly advise the Agents and the
Agents will forthwith suspend solicitation of offers to
purchase such Notes. The Agents will telephone the Company
with recommendations as to the changed interest rates or
other variable terms. At such time as the Company advises
the Agents of the new interest rates or other variable
terms, the Agents may resume solicitation of offers to
purchase such Notes. Until such time, only "indications of
interest" may be recorded. Immediately after acceptance by
the Company of an offer to purchase at a new
A-5
interest rate or new variable term, the Company, the
Agents and the Trustee shall follow the procedures set
forth under the applicable Settlement Procedures.
Suspension of
Solicitation;
Amendment or
Supplement: The Company may instruct the Agents to suspend solicitation
of purchases at any time. Upon receipt of such instructions
the Agents will forthwith suspend solicitation of offers to
purchase from the Company and, if the Agents shall not then
hold any Notes as principal purchased pursuant to a Terms
Agreement (or, if the Agents hold Notes as principal
pursuant to a Terms Agreement, the Agents have held such
Notes for more than 180 days), the Company's obligations
described in this paragraph shall likewise be suspended
until such time as the Company has advised them that
solicitation of offers to purchase may be resumed. The
Company will give the Agents notice of its intention to file
or prepare any additional registration statement with
respect to the registration of additional Notes, any
amendment to the Registration Statement or any amendment or
supplement to the Prospectus (other than an amendment or
supplement providing solely for a change in the interest
rates of the Notes or an amendment or supplement that
relates exclusively to an offering of senior debt securities
other than the Notes) or any document that would as a result
thereof be incorporated by reference in the Prospectus, and
will furnish the Agents with copies of any such amendment or
supplement or other documents proposed to be filed or
prepared a reasonable time in advance of such proposed
filing or preparation, as the case may be, and will not file
any such amendment or supplement or other documents in a
form to which the Agents or counsel for the Agents shall
reasonably object; PROVIDED, that the requirements of this
sentence shall not apply to the Company's proxy statement,
its Annual Report on Form 10-K, its Quarterly Reports on
Form 10-Q or its Current Reports on Form 8-K, so long as the
Company shall furnish the Agents with copies of such
documents on or prior to the date of filing thereof with the
A-6
Commission. The Company will furnish the Agents with copies
of any document incorporated by reference into the
Prospectus promptly following the filing of such document.
One copy of such filed document, along with a copy of the
cover letter sent to the Commission, will be delivered or
mailed to the Agents at the following addresses:
Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
North Tower, 10th Floor
World Financial Center
New York, New York 10281
Attn: MTN Product Management;
Xxxxxxxxx Xxxxxx & Xxxxxxxx Securities
Corporation
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxxxxxx;
X.X. Xxxxxx Securities Inc.
00 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Medium-Term Note Desk;
Xxxxxx Xxxxxxx & Co. Incorporated
1585 Broadway, 2nd Floor
New York, New York 10036
Attn: Manager, Continuously Offered
Products.
In the event that at the time the solicitation of offers to
purchase from the Company is suspended (other than to change
interest rates or other variable terms) there shall be any
orders outstanding that have not been settled, the Company
will promptly advise the Agents and the Trustee whether such
orders may be settled and whether copies of the Prospectus
as theretofore amended and/or supplemented as in effect at
the time of the suspension may be delivered in connection
with the settlement of such orders. The Company will have
the sole responsibility for such decision and for any
arrangements that may be made in the event that the Company
determines that such orders may not be settled or that
copies of such Prospectus may not be so delivered.
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Delivery of
Prospectus: A copy of the most recent Prospectus, Prospectus Supplement
and Pricing Supplement must accompany or precede the earlier
of (a) the written confirmation of a sale sent to a customer
or his agent and (b) the delivery of Notes to a customer or
his agent.
Authenticity of
Signatures: The Agents will have no obligations or liability to the
Company or the Trustee in respect of the authenticity of the
signature of any officer, employee or agent of the Company
or the Trustee on any Note.
Documents
Incorporated
by Reference: The Company shall supply the Agents with an adequate supply
of all documents incorporated by reference in the
Registration Statement.
Business Day: "Business Day" means any day, other than a Saturday or
Sunday, that is not a day on which banks in The City of New
York are required or authorized by law or regulation to
close. The definition of Business Day with respect to Notes
issued in a currency other than the U.S. dollar or in a
currency unit shall be as set forth in the Prospectus
Supplement or applicable Pricing Supplement.
PART II: PROCEDURES FOR NOTES ISSUED IN BOOK-ENTRY FORM
In connection with the qualification of Notes issued in
book-entry form for eligibility in the book-entry system
maintained by DTC, the Trustee will perform the
custodial, document control and administrative functions
described below, in accordance with its respective
obligations under a Letter of Representations from the
Company and the Trustee to DTC, dated February 11, 1998,
a Medium-Term Note Certificate Agreement, dated December
2, 1988 between the Trustee and DTC (the "Certificate
Agreement"), and its obligations as a participant in DTC,
including DTC's Same-Day Funds Settlement System
("SDFS").
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Issuance: All Notes issued in book-entry form having the same Original
Issue Date, interest rate, terms of redemption or repayment,
if any, and Stated Maturity (collectively, the "Terms") will
be represented initially by a single global security in
fully registered form without coupons (each, a "Book-Entry
Note").
Each Book-Entry Note will be dated and issued as of the date
of its authentication by the Trustee. No Book-Entry Note
shall represent any Note issued in certificated form.
Identification: The Company has arranged with the CUSIP Service Bureau (the
"CUSIP Service Bureau") of Standard & Poor's Corporation
("Standard & Poor's") for the reservation of approximately
900 CUSIP numbers that have been reserved for and relating
to Book-Entry Notes, and the Company has delivered to the
Trustee and DTC a list of such CUSIP numbers. The Company
will assign CUSIP numbers to Book-Entry Notes as described
below under the Settlement Procedure B. DTC will notify the
CUSIP Service Bureau periodically of the CUSIP numbers that
the Company has assigned to Book-Entry Notes. The Trustee
will notify the Company at any time when fewer than 100 of
the reserved CUSIP numbers remain unassigned to Book-Entry
Notes, and, if it deems necessary, the Company will reserve
additional CUSIP numbers for assignment to Book-Entry Notes.
Upon obtaining such additional CUSIP numbers, the Company
will deliver a list of such additional numbers to the
Trustee and DTC. Book-Entry Notes having an aggregate
principal amount in excess of $200,000,000 and otherwise
required to be represented by the same Global Certificate
will instead be represented by two or more Global
Certificates that shall all be assigned the same CUSIP
number.
Registration: Each Book-Entry Note will be registered in the name of Cede
& Co., as nominee for DTC, on the register maintained by the
Trustee under the Indenture. The beneficial owner of a Note
issued in book-entry form (I.E., a owner of beneficial
interest in a Book-Entry Note) (or one or more indirect
participants in DTC designated by such owner) will designate
one or more participants in DTC
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(with respect to such Note issued in book-entry form, the
"Participants") to act as agent for such beneficial owner
in connection with the book-entry system maintained by
DTC, and DTC will record in book-entry form, in
accordance with instructions provided by such
Participants, a credit balance with respect to such Note
issued in book-entry form in the account of such
Participants.
The ownership interest of such beneficial owner in such Note
issued in book-entry form will be recorded through the
records of such Participants or through the separate records
of such Participants and one or more indirect participants
in DTC.
Transfers: Transfers of a beneficial interest in a Book-Entry Note will
be accomplished by book entries made by DTC and, in turn, by
Participants (and in certain cases, one or more indirect
participants in DTC) acting on behalf of transferors and
transferees of beneficial interests in such Book-Entry Note.
Exchanges: The Trustee may deliver to DTC and the CUSIP Service
Bureau at any time a written notice specifying (a) the
CUSIP numbers of two or more Book-Entry Notes Outstanding
on such date that represent Book-Entry Notes having the
same Terms (other than Original Issue Dates) and for
which interest has been paid to the same date; (b) a
date, occurring at least 30 days after such written
notice is delivered and at least 30 days before the next
Interest Payment Date for the related Notes issued in
book-entry form, on which such Book-Entry Notes shall be
exchanged for a single replacement Book-Entry Note; and
(c) a new CUSIP number, obtained from the Company to be
assigned to such replacement Book-Entry Note. Upon
receipt of such a notice, DTC will send to its
participants (including the Trustee) a written
reorganization notice to the effect that such exchange
will occur on such date. Prior to the specified exchange
date, the Trustee will deliver to the CUSIP Service
Bureau a written notice setting forth such exchange date
and the new CUSIP number and stating that, as of such
exchange date, the CUSIP numbers of the Book-Entry Notes
to be exchanged will no longer be valid. On the
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specified exchange date, the Trustee will exchange such
Book-Entry Notes for a single Book-Entry Note bearing the
new CUSIP number and the CUSIP numbers of the exchanged
Book-Entry Notes will, in accordance with CUSIP Service
Bureau procedures, be cancelled and not immediately
reassigned. Notwithstanding the foregoing, if the
Book-Entry Notes to be exchanged exceed $200,000,000 in
aggregate principal amount, one replacement Book-Entry
Note will be authenticated and issued to represent
$200,000,000 of principal amount of the exchanged
Book-Entry Notes and an additional Book-Entry Note or
Notes will be authenticated and issued to represent any
remaining principal amount of such Book-Entry Notes (See
"Denominations" below).
Denominations: Unless otherwise specified, all Notes issued in
book-entry form will be denominated in U.S. dollars.
Notes issued in book-entry form will be issued in
denominations of $1,000 and any larger denomination that
is an integral multiple of $1,000. Book-Entry Notes will
be denominated in principal amounts not in excess of
$200,000,000. If one or more Notes issued in book-entry
form having an aggregate principal amount in excess of
$200,000,000 would, but for the preceding sentence, be
represented by a single Book-Entry Note, then one
Book-Entry Note will be issued to represent $200,000,000
principal amount of such Note or Notes issued in
book-entry form and an additional Book-Entry Note or
Notes will be issued to represent any remaining principal
amount of such Note or Notes issued in book-entry form.
In such a case, each of the Book-Entry Notes representing
such Note or Notes issued in book-entry form shall be
assigned the same CUSIP number.
Interest: GENERAL. Interest on each Note issued in book-entry form
will accrue from the most recent Interest Payment Date to
which interest has been paid or duly provided for or, if no
interest has been paid or duly provided for, from the
Original Issue Date, of the Book-Entry Note representing
such Note. Each payment of interest on a Note issued in
book-entry form will include interest accrued through the
day preceding,
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as the case may be, the Interest Payment Date or Stated
Maturity date or date of redemption or repayment of a
Note, as the case may be (such Stated Maturity date or
date of redemption or repayment being referred to herein
as a "Maturity" with respect to the principal amount
payable on such date). Interest payable at Maturity of a
Note issued in book-entry form will be payable to the
Person to whom the principal of such Note is payable.
DTC will arrange for each pending deposit message
described under Settlement Procedure C below to be
transmitted to Standard & Poor's, which will use the
information in the message to include certain terms of
the related Book-Entry Note in the appropriate daily bond
report published by Standard & Poor's.
REGULAR RECORD DATES. The Regular Record Date with respect
to any Interest Payment Date for a Note shall be the July 15
or January 15 preceding such Interest Payment Date.
INTEREST PAYMENT DATES. Interest payments will be made on
each Interest Payment Date commencing with the first
Interest Payment Date following the Original Issue Date;
PROVIDED, HOWEVER, that the first payment of interest on any
Book-Entry Note originally issued between a Regular Record
Date and an Interest Payment Date will occur on the Interest
Payment Date following the next Regular Record Date.
If an Interest Payment Date with respect to any Note issued
in book-entry form falls on a day that is not a Business Day
with respect to such Note such Interest Payment Date will be
the following day that is a Business Day with respect to
such Note.
Interest payments on Notes issued in book-entry form will be
made semiannually on August 1 and February 1 of each year
and at Maturity.
Payments of
Principal
and Interest: PAYMENTS OF INTEREST ONLY. Promptly after each Regular
Record Date, the Trustee will
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deliver to the Company and DTC a written notice
specifying by CUSIP number the amount of interest to be
paid on each Book-Entry Note on the following Interest
Payment Date (other than an Interest Payment Date
coinciding with Maturity) and the total of such amounts.
DTC will confirm the amount payable on each Book-Entry
Note on such Interest Payment Date by reference to the
daily bond reports published by Standard & Poor's. On
such Interest Payment Date, the Company will pay to the
Trustee, and the Trustee in turn will pay to DTC, such
total amount of interest due (other than at Maturity) at
the times and in the manner set forth below under "Manner
of Payment".
PAYMENTS AT MATURITY. On or about the first Business Day
of each month, the Trustee will deliver to the Company
and DTC a written list of principal, interest and
premium, if any, to be paid on each Book-Entry Note at
Maturity in the following month. The Trustee, the
Company and DTC will confirm the amounts of such
principal and interest payments with respect to a
Book-Entry Note on or about the fifth Business Day
preceding the Maturity of such Book-Entry Note. At such
Maturity, the Company will pay to the Trustee, and the
Trustee in turn will pay to DTC, the principal amount of
such Note, together with interest and premium, if any,
due at such Maturity, at the times and in the manner set
forth below under "Manner of Payment". If any Maturity
of a Book-Entry Note is not a Business Day, the payment
due on such day shall be made on the next succeeding
Business Day and no interest shall accrue on such payment
for the period from and after such Maturity. Promptly
after payment to DTC of the principal, interest and
premium, if any, due at the Maturity of such Book-Entry
Note, the Trustee will cancel such Book-Entry Note and
deliver it to the Company with an appropriate debit
advice. On the first Business Day of each month, the
Trustee will deliver to the Company a written statement
indicating the total principal amount of Outstanding
Book-Entry Notes as of the immediately preceding Business
Day.
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MANNER OF PAYMENT. The total amount of any principal,
premium, if any, and interest due on Book-Entry Notes on any
Interest Payment Date or at Maturity shall be paid by the
Company to the Trustee in funds available for use by the
Trustee as of 9:30 a.m., New York City time, on such date.
The Company will make such payment on such Book-Entry Notes
by instructing the Trustee to withdraw funds from an account
maintained by the Company at the Trustee. The Company will
confirm such instructions in writing to the Trustee. Prior
to 10:00 a.m., New York City time, on such date or as soon
as possible thereafter, the Trustee will pay by separate
wire transfer (using Fedwire message entry instructions in a
form previously specified by DTC) to an account at the
Federal Reserve Bank of New York previously specified by
DTC, in funds available for immediate use by DTC, each
payment of interest, principal and premium, if any, due on a
Book-Entry Note on such date. Thereafter on such date, DTC
will pay, in accordance with its SDFS operating procedures
then in effect, such amounts in funds available for
immediate use to the respective Participants in whose names
such Notes are recorded in the book-entry system maintained
by DTC. Neither the Company nor the Trustee shall have any
responsibility or liability for the payment by DTC of the
principal of, or interest on, the Book-Entry Notes to such
Participants.
WITHHOLDING TAXES. The amount of any taxes required under
applicable law to be withheld from any interest payment on a
Note will be determined and withheld by the Participant,
indirect participant in DTC or other Person responsible for
forwarding payments and materials directly to the beneficial
owner of such Note.
Settlement
Procedures: Settlement Procedures with regard to each Note in book-entry
form sold by each Agents, as agent of the Company, will be
as follows:
A. The Agents will advise the Company by telephone of the
following settlement information:
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1. Taxpayer identification number of the purchaser.
2. Principal amount of the Note.
3. Interest Rate.
4. Price to public of the Note.
5. Trade date.
6. Settlement date (Original Issue Date).
7. Stated Maturity.
8. Net proceeds to the Company.
9. Agents' commission.
10. Original issue discount, if any.
11. Redemption provisions, if any.
12. Repayment provisions, if any.
B. The Company will advise the Trustee of the information
set forth in Settlement Procedure A above. All
instructions regarding the completion, authentication
and delivery of Notes shall be given by an authorized
representative of the Company by telephone (confirmed
in writing), facsimile transmission, tested telex or by
another acceptable written means.
C. The Trustee, on behalf of the Company, will assign a
CUSIP number to the Book-Entry Note and will notify the
Company by telephone of such CUSIP number as soon as
practicable. The Trustee will communicate to DTC and
the Agents through DTC's Participant Terminal System, a
pending deposit message specifying the following
settlement information:
1. The information set forth in Settlement Procedure
A.
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2. Identification numbers of the participant accounts
maintained by DTC on behalf of the Trustee and the
Agents.
3. Identification as a Book-Entry Note.
4. Initial Interest Payment Date for such Note,
number of days by which such date succeeds the
related record date for DTC purposes and, if then
calculable, the amount of interest payable on such
Interest Payment Date (which amount shall have
been confirmed by the Trustee).
5. CUSIP number of the Book-Entry Note representing
such Note.
6. Whether such Book-Entry Note represents any other
Notes issued or to be issued in book-entry form.
D. The Company will complete and deliver to the Trustee a
Book-Entry Note representing such Note in a form that
has been approved by the Company, the Agents and the
Trustee.
E. The Trustee, pursuant to a Company Order then in
effect, will authenticate and register the Book-Entry
Note representing such Note.
F. DTC will credit such Note to the participant account of
the Trustee maintained by DTC.
G. The Trustee will enter an SDFS deliver order through
DTC's Participant Terminal System instructing DTC
(i) to debit such Note to the Trustee's participant
account and credit such Note to the participant
account of the Agents maintained by DTC and (ii) to
debit the settlement account of the Agents and
credit the settlement account of the Trustee
maintained by DTC, in an amount equal to the price
of such Note less the Agents' commission. Any entry
of such a
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deliver order shall be deemed to constitute a
representation and warranty by the Trustee to DTC
that (i) the Book-Entry Note representing such Note
has been issued and authenticated and(ii) the
Trustee is holding such Book-Entry Note pursuant to
the Medium-Term Note Certificate Agreement between
the Trustee and DTC.
H. The Agents will enter an SDFS deliver order through
DTC's Participant Terminal System instructing DTC (i)
to debit such Note to the Agents' participant account
and credit such Note to the participant accounts of the
Participants maintained by DTC and (ii) to debit the
settlement accounts of such Participants and credit the
settlement account of the Agents maintained by DTC, in
an amount equal to the initial public offering price of
such Note.
I. Transfers of funds in accordance with SDFS deliver
orders described in Settlement Procedures G and H will
be settled in accordance with SDFS operating procedures
in effect on the day of settlement (the "Settlement
Date").
J. The Trustee will credit to an account of the Company
maintained at the Trustee funds available for immediate
use in the amount transferred to the Trustee in
accordance with Settlement Procedure G.
K. The Trustee will send a copy of the Book-Entry Note by
first class mail to the Company together with a
statement setting forth the principal amount of Notes
Outstanding as of the related Settlement Date after
giving effect to such transaction and all other offers
to purchase Notes of which the Company has advised the
Trustee but which have not yet been settled.
L. The Agents will confirm the purchase of such Note to
the Purchaser either by transmitting to the Participant
with respect to such Note a confirmation
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order through DTC's Participant Terminal System or
by mailing a written confirmation to such purchaser.
Settlement
Procedures
Timetable: For orders of Notes accepted by the Company, Settlement
Procedures A through L set forth above shall be completed as
soon as possible but not later than the respective times
(New York City time) set forth below:
Settlement
Procedure Time
--------- ----
A 5:00 p.m. on Business Day
following Trade Date or 10:00 a.m. on
Business Day prior to Settlement Date,
whichever is earlier
B 12:00 Noon on second Business
Day immediately preceeding Settlement Date
C 2:00 p.m. on second Business
Day immediately preceeding Settlement Date
D-E 9:00 a.m. on Settlement Date
F 10:00 a.m. on Settlement Date
G-H 2:00 p.m. on Settlement Date
I 4:45 p.m. on Settlement Date
J 5:00 p.m. on Settlement Date
If a sale is to be settled more than one Business Day after
the sale date, Settlement Procedures A, B, and C may, if
necessary, be completed at any time prior to the specified
times on the first Business Day after such sale date.
Settlement Procedure I is subject to extension in accordance
with any extension of Fedwire closing deadlines and in the
other events specified in the SDFS operating procedures in
effect on the Settlement Date.
If settlement of a Note issued in book-entry form is
rescheduled or canceled, the Trustee will deliver to DTC
through DTC's Participant Terminal System, a cancellation
message to such effect by no later than 2:00 p.m., New York
City time, on the Business Day immediately Preceding the
scheduled Settlement Date.
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Failure
to Settle: If the Trustee fails to enter an SDFS deliver order with
respect to a Book-Entry Note issued in book-entry form
pursuant to Settlement Procedure G, the Trustee may
deliver to DTC, through DTC's Participant Terminal
System, as soon as practicable a withdrawal message
instructing DTC to debit such Note to the participant
account of the Trustee maintained at DTC. DTC will
process the withdrawal message, provided that such
participant account contains a principal amount of the
Book-Entry Note representing such Note that is at least
equal to the principal amount to be debited. If
withdrawal messages are processed with respect to all the
Notes represented by a Book-Entry Note, the Trustee will
mark such Book-Entry Note "Cancelled", make appropriate
entries in its records and send such cancelled Book-Entry
Note to the Company. The CUSIP number assigned to such
Book-Entry Note shall, in accordance with CUSIP Service
Bureau procedures, be cancelled and not immediately
reassigned. If withdrawal messages are processed with
respect to a portion of the Notes represented by a
Book-Entry Note, the Trustee will exchange such
Book-Entry Note for two Book-Entry Notes, one of which
shall represent the Book-Entry Notes for which withdrawal
messages are processed and shall be cancelled immediately
after issuance, and the other of which shall represent
the other Notes previously represented by the surrendered
Book-Entry Note and shall bear the CUSIP number of the
surrendered Book-Entry Note.
If the purchase price for any Book-Entry Note is not timely
paid to the Participants with respect to such Note by the
beneficial purchaser thereof (or a person, including an
indirect participant in DTC, acting on behalf of such
purchaser), such Participants and, in turn, the Agents may
enter SDFS deliver orders through DTC's Participant Terminal
System reversing the orders entered pursuant to Settlement
Procedures G and H, respectively. Thereafter, the Trustee
will deliver the withdrawal message and take the related
actions described in the preceding paragraph. If such
failure shall have
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occurred for any reason other than default by the Agents
to perform their obligations hereunder or under the
Distribution Agreement, the Company will reimburse the
Agents on an equitable basis for their loss of the use of
funds during the period when the funds were credited to
the account of the Company.
Notwithstanding the foregoing, upon any failure to settle
with respect to a Book-Entry Note, DTC may take any actions
in accordance with its SDFS operating procedures then in
effect. In the event of a failure to settle with respect to
a Note that was to have been represented by a Book-Entry
Note also representing other Notes, the Trustee will
provide, in accordance with Settlement Procedures D and E,
for the authentication and issuance of a Book-Entry Note
representing such remaining Notes and will make appropriate
entries in its records.
Trustee and Paying
Agents Not to
Risk Funds: Nothing herein will be deemed to require the Trustee or the
Paying Agent to risk or expend its own funds in connection
with any payment to the Company, the Agents, the Depository
or any Participant, it being understood by all parties that
payments, made by the Trustee or the Paying Agent to any
party will be made only to the extent that funds are
provided to the Trustee or the Paying Agent, as the case may
be, for such purposes.
PART III: PROCEDURES FOR NOTES ISSUED IN CERTIFICATED FORM
Denominations: Unless otherwise specified, the Notes will be issued in
denominations of U.S. $1,000 and integral multiples of U.S.
$1,000 in excess thereof or the equivalent in a foreign
currency or currency unit as determined by the Company and
as specified in the applicable Pricing Supplement.
Interest: Each Note will bear interest in accordance with its terms.
Interest will begin to accrue on the Original Issue Date of
a Note for the first interest period and on the most recent
Interest Payment Date to which
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interest has been paid or duly provided for all
subsequent interest periods. Each payment of interest
shall include interest accrued to, but excluding, the
Interest Payment Date or Maturity, as the case may be.
Unless otherwise specified in the applicable Pricing
Supplement, interest payments in respect of Notes will be
made semiannually on August 1 and February 1 of each year
and at Maturity. However, the first payment of interest
on any Note issued between a Regular Record Date and an
Interest Payment Date will be made on the Interest
Payment Date following the next succeeding Regular Record
Date. The Regular Record Date with respect to any
Interest Payment Date for a Note shall be the July 15 or
January 15 preceding such Interest Payment Date.
Interest at Maturity will be payable to the person to
whom the principle is payable.
Payments of
Principal and
Interest: Upon presentment and delivery of the Note, the Trustee will
pay the principal amount of, premium, if any, and the final
installment of interest on, each Note at Maturity in
immediately available funds. All interest payments on a
Note, other than interest due at Maturity, will be made by
check drawn on the Trustee and mailed by the Trustee to the
person entitled thereto as provided in the Note. However,
holders of ten million dollars or more in aggregate
principal amount of Notes (whether having identical or
different terms and provisions) shall be entitled to receive
payments of interest, other than at Maturity, by wire
transfer of immediately available funds if a request to such
effect, which request indicates appropriate wire transfer
instructions, has been received in writing (mailed or hand
delivered) or by cable, telex or facsimile transmission by
the Trustee on or before the Regular Record Date immediately
preceding the applicable Interest Payment Date. Any payment
of principal or interest required to be made on an Interest
Payment Date or at Maturity of a Note that is not a Business
Day need not be made on such day, but may be made on the
next succeeding Business Day with the same force and effect
as if made on the
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Interest Payment Date or at Maturity, as the case may be,
and no interest shall accrue for the period from and
after such Interest Payment Date or Maturity.
The Trustee will provide monthly to the Company a list of
the principal and interest in each currency to be paid on
Notes maturing in the next succeeding month. The Trustee
will be responsible for withholding taxes on interest paid
as required by applicable law, but shall be relieved from
any such responsibility if it acts in good faith and in
reliance upon an opinion of counsel.
Notes presented to the Trustee at Maturity for payment will
be cancelled by the Trustee. All cancelled Notes held by
the Trustee shall be destroyed, and the Trustee shall
furnish to the Company a certificate with respect to such
destruction.
Settlement
Procedures: Settlement Procedures with regard to each Note purchased
through the Agents, as agents, shall be as follows:
A. The Agents will advise the Company by telephone of the
following settlement information with regard to each
Note:
1. Exact name in which the Note is to be registered
(the "Registered Owner").
2. Exact address or addresses of the Registered Owner
for delivery, notices and payments of principal
and interest.
3. Taxpayer identification number of the Registered
Owner.
4. Principal amount of the Note.
5. Denomination of the Note.
6. Interest Rate.
7. Price to public of the Note.
8. Trade Date.
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9. Settlement Date (Original Issue Date).
10. Stated Maturity.
11. Net proceeds to the Company.
12. Agents' commission.
13. Original issue discount, if any.
14. Redemption provisions, if any.
15. Repayment provisions, if any.
B. The Company will advise the Trustee of the information
set forth in Settlement Procedure A above and shall
cause the Trustee, pursuant to a Company Order then in
effect, to issue, authenticate and deliver Notes. The
Company also shall provide to the Trustee and/or Agents
a copy of the applicable Pricing Supplement.
All instructions regarding the completion,
authentication and delivery of Notes shall be given by
an authorized representative of the Company by
telephone (confirmed in writing), facsimile
transmission, tested telex or by other acceptable
written means.
C. The Trustee will complete the pre-printed 4-ply Note
packet containing the following documents in forms
approved by the Company, the Agents and the Trustee:
1. Note with Agents' customer confirmation.
2. Stub 1 - for Trustee.
3. Stub 2 - for Agents.
4. Stub 3 - for the Company.
D. With respect to each trade, the Trustee will deliver
the Notes and Stub 2 thereof to the Agents at the
following addresses:
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Xxxxxxx Xxxxx & Co.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
North Tower, 10th Floor
World Financial Center
New York, New York 10281
Attn: MTN Product Management;
Xxxxxxxxx Xxxxxx & Xxxxxxxx Securities
Corporation
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxx Xxxxxxx;
X.X. Xxxxxx Securities Inc.
00 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Medium-Term Note Desk;
Xxxxxx Xxxxxxx & Co. Incorporated
1585 Broadway, 2nd Floor
New York, New York 10036
Attn: Manager, Continuously Offered
Products.
The Trustee will keep Stub 1. The Agents will
acknowledge receipt of the Note through a broker's
receipt and will keep Stub 2. Delivery of the Note
will be made only against such acknowledgement of
receipt. Upon determination that the Note has been
authorized, delivered and completed as aforementioned,
the Agents will wire the net proceeds of the Note after
deduction of their applicable commission to the Company
pursuant to standard wire instructions given by the
Company.
E. The Agents will deliver the Note (with confirmations),
as well as a copy of the Prospectus Supplement and any
applicable Pricing Supplement received from the
Trustee, to the purchaser against payment in
immediately available funds.
F. The Trustee will send Stub 3 to the Company.
Settlement
Procedures
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Timetable: For offers accepted by the Company, Settlement Procedures A
through F set forth above shall be completed on or before
the respective times set forth below:
Settlement
Procedure Time
--------- ----
A-B 3:00 p.m. on Business Day prior to Settlement
Date
C-D 2:15 p.m. on Settlement Date
E 3:00 p.m. on Settlement Date
F 5:00 p.m. on Settlement Date
Failure to
Settle: In the event that a purchaser of a Note from the Company
shall either fail to accept delivery of or make payment for
a Note on the date fixed for settlement, the Agents will
forthwith notify the Trustee and the Company by telephone,
confirmed in writing, and return the Note to the Trustee.
The Trustee, upon receipt of the Note from the Agents, will
immediately advise the Company and the Company will promptly
arrange to credit the account of the Agents in an amount of
immediately available funds equal to the amount previously
paid by the Agents in settlement for the Note. Such credits
will be made on the Settlement Date if possible, and in any
event not later than the Business Day following the
Settlement Date; provided that the Company has received
notice on the same day. If such failure shall have occurred
for any reason other than failure by the Agents to perform
their obligations hereunder or under the Distribution
Agreement, the Company will reimburse the Agents on an
equitable basis for its loss of the use of funds during the
period when the funds were credited to the account of the
Company. Immediately upon receipt of the Note in respect of
which the failure occurred, the Trustee will cancel and
destroy the Note, make appropriate entries in its records to
reflect the fact that the Note was never issued, and
accordingly notify in writing the Company.
A-25
EXHIBIT B
[Opinion of General Counsel]
B-1
SCHEDULE A
As compensation for the services of each Agent hereunder, the Company
shall pay such Agent, on a discount basis, a commission for the sale of each
Note through it as agent equal to the principal amount of such Note multiplied
by the appropriate percentage set forth below:
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT(a)
--------------- -------------------
From 9 months to less than 1 year. . . . . . . . . . . . . . . . . . . . . .125%
From 1 year to less than 18 months . . . . . . . . . . . . . . . . . . . . .150
From 18 months to less than 2 years. . . . . . . . . . . . . . . . . . . . .200
From 2 years to less than 3 years. . . . . . . . . . . . . . . . . . . . . .250
From 3 years to less than 4 years. . . . . . . . . . . . . . . . . . . . . .350
From 4 years to less than 5 years. . . . . . . . . . . . . . . . . . . . . .450
From 5 years to less than 6 years. . . . . . . . . . . . . . . . . . . . . .500
From 6 years to less than 7 years. . . . . . . . . . . . . . . . . . . . . .550
From 7 years to less than 10 years . . . . . . . . . . . . . . . . . . . . .600
From 10 years to less than 15 years. . . . . . . . . . . . . . . . . . . . .625
From 15 years to less than 20 years. . . . . . . . . . . . . . . . . . . . .700
From 20 years to 30 years. . . . . . . . . . . . . . . . . . . . . . . . . .750
With respect to each Note with a term in excess of 30 years from the date of
issue, the commission payable as a result of a solicitation made by an Agent
will agreed to by the Company and such Agent at the time of such sale.
------------------------
(a) With respect to each Note that is a Discount Security (as defined in the
Indenture), the commission payable as a result of a solicitation made by an
Agent shall be based on the initial offering price of such Note.
SCHEDULE B
The following terms, if applicable, shall be agreed to by one or more
Agents and the Company pursuant to each Terms Agreement:
Principal Amount: $
(or principal amount of foreign or composite currency)
Interest Rate:
If Redeemable:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
If Repayable:
Optional Repayment Date(s):
Stated Maturity Date:
Purchase Price: _______%
Settlement Date and Time:
Currency of Denomination and Payment:
Denominations (if other than U.S. dollars):
Additional Terms:
Also, agreement as to whether the following will be required:
Officers' Certificate pursuant to Section 7(b)
of the Distribution Agreement.
Legal Opinions pursuant to Section 7(c) of the
Distribution Agreement.
Comfort Letter pursuant to Section 7(d) of the
Distribution Agreement.
Stand-off Agreement pursuant to Section 4(j) of
the Distribution Agreement.
