EXHIBIT 1.4
[FORM OF DISTRIBUTION AGREEMENT]
$5,000,000,000
CREDIT SUISSE FIRST BOSTON (USA), INC.
MEDIUM-TERM NOTES
DISTRIBUTION AGREEMENT
June __, 2001
Credit Suisse First Boston Corporation,
Eleven Xxxxxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000-0000.
Ladies and Gentlemen:
1. INTRODUCTION. Credit Suisse First Boston (USA), Inc., a Delaware
corporation (the "Issuer"), confirms its agreement with you (the "Distributor")
with respect to the issue and sale from time to time by the Issuer of its
medium-term notes registered under the registration statement referred to in
Section 2(a) (any such medium-term notes being hereinafter referred to as the
"Securities", which expression shall, if the context so admits, include any
permanent global Security). Securities may be offered and sold pursuant to
Section 3 of this Agreement in an aggregate amount not to exceed the amount of
Registered Securities (as defined in Section 2(a) hereof) registered pursuant to
such registration statement reduced by the aggregate amount of any other
Registered Securities sold otherwise than pursuant to Section 3 of this
Agreement. The Securities will be issued under a senior indenture, dated as of
June 1, 2001 (the "Indenture"), between the Issuer and The Chase Manhattan Bank,
as trustee (the "Trustee").
The Securities shall have the terms described in the Prospectus
referred to in Section 2(a) as it may be amended or supplemented from time to
time, including any supplement to the Prospectus that sets forth only the terms
of a particular issue of the Securities (a "Pricing Supplement"). Securities
will be issued, and the terms thereof established, from time to time by the
Issuer in accordance with the Indenture and the Procedures (as defined in
Section 3(d) hereof).
2. REPRESENTATIONS AND WARRANTIES OF THE ISSUER. The Issuer
represents and warrants to, and agrees with, the Distributor as follows:
(a) A registration statement (No. 333-_____), including a prospectus,
relating to $5,000,000,000 aggregate principal amount of debt securities of the
Issuer, including the Securities (the "Registered Securities") (including a
prospectus which, as supplemented from time to time, shall be used in connection
with sales of the Securities) has been filed with the
Securities and Exchange Commission (the "Commission") and has been declared
effective under the Securities Act of 1933, as amended (the "Act"). Such
registration statement, as amended as of the Closing Date (as defined in Section
3(e) hereof), is hereinafter referred to as the "Registration Statement", and
the prospectus included in such Registration Statement, as supplemented so as
generally to describe the Securities and the terms of the offering of the
Securities, including all material incorporated by reference therein, is
hereinafter referred to as the "Prospectus". Any reference in this Agreement to
amending or supplementing the Prospectus shall be deemed to include the filing
of materials incorporated by reference in the Prospectus after the Closing Date
and any reference in this Agreement to any amendment or supplement to the
Prospectus shall be deemed to include any such materials incorporated by
reference in the Prospectus after the Closing Date. No document has been or will
be prepared or distributed in reliance on Rule 434 under the Act.
(b) On the effective date of the Registration Statement, such
Registration Statement conformed in all respects to the requirements of the Act,
the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the
rules and regulations of the Commission ("Rules and Regulations") and did not
include any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading, and on the Closing Date, and at each of the times of acceptance
and of delivery referred to in Section 6(a) hereof and at each of the times of
amendment or supplementing referred to in Section 6(b) hereof (the Closing Date
and each such time being herein sometimes referred to as a "Representation
Date"), the Registration Statement and the Prospectus as then amended or
supplemented will conform in all respects to the requirements of the Act, the
Trust Indenture Act and the Rules and Regulations, and neither of such documents
will include any untrue statement of a material fact or will omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading, except that the foregoing does not apply to statements
in or omissions from any of such documents based upon written information
furnished to the Issuer by the Distributor specifically for use therein.
(c) The Issuer has been duly incorporated and is an existing
corporation in good standing under the laws of the State of Delaware, with power
and authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus; and the Issuer is duly qualified to do
business as a foreign corporation in good standing in all other jurisdictions in
which its ownership or lease of property or the conduct of its business requires
such qualification.
(d) Each subsidiary of the Issuer has been duly incorporated and is an
existing corporation in good standing under the laws of the jurisdiction of its
incorporation, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus; and each
subsidiary of the Issuer is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions in which its ownership
or lease of property or the conduct of its business requires such qualification;
all of the issued and outstanding capital stock of each subsidiary of the Issuer
has been duly authorized and validly issued and is fully paid and nonassessable;
and the capital stock of each subsidiary owned by the Issuer, directly or
through subsidiaries, is owned free from liens, encumbrances and defects.
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(e) The Indenture has been duly authorized, executed and delivered by
the Issuer and duly qualified under the Trust Indenture Act and constitutes a
valid and legally binding obligation of the Company enforceable in accordance
with its terms, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and to general equity principles; the Securities
have been duly authorized, and when the Securities have been delivered and paid
for pursuant to this Agreement, the Securities will have been duly executed,
authenticated, issued and delivered and will conform to the description thereof
contained in the Prospectus and will constitute valid and legally binding
obligations of the Issuer enforceable in accordance with their terms, subject to
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and
similar laws of general applicability relating to or affecting creditors' rights
and to general equity principles.
(f) No consent, approval, authorization, or order of, or filing with,
any governmental agency or body or any court is required for the consummation of
the transactions contemplated by this Agreement in connection with the issuance
and sale of the Securities by the Issuer, except such as have been obtained and
made under the Act and the Trust Indenture Act and such as may be required under
state securities laws.
(g) The execution, delivery and performance of the Indenture and this
Agreement do not, and the completion, execution and issuance of each particular
Security in accordance with the Indenture, the sale by the Issuer of such
Security in accordance with this Agreement and compliance with the terms and
provisions thereof will not, result in a breach or violation of any of the terms
and provisions of, or constitute a default under, any statute, any rule,
regulation or order of any governmental agency or body or any court, domestic or
foreign, having jurisdiction over the Issuer or any subsidiary of the Issuer or
any of their properties, or any agreement or instrument to which the Issuer or
any such subsidiary is a party or by which the Issuer or any such subsidiary is
bound or to which any of the properties of the Issuer or any such subsidiary is
subject, or the charter or by-laws of the Issuer or any such subsidiary, and the
Issuer has full power and authority to authorize, issue and sell the Securities
as contemplated by this Agreement.
(h) This Agreement (including any agreement with respect to the
offering and sale of particular Securities as contemplated by Section 3) has
been duly authorized, executed and delivered by the Issuer.
(i) Except as disclosed in the Prospectus, the Issuer and its
subsidiaries have good and marketable title to all real properties and all other
properties and assets owned by them, in each case free from liens, encumbrances
and defects that would materially affect the value thereof or materially
interfere with the use made or to be made thereof by them; and except as
disclosed in the Prospectus, the Issuer and its subsidiaries hold any leased
real or personal property under valid and enforceable leases with no exceptions
that would materially interfere with the use made or to be made thereof by them.
(j) The Issuer and its subsidiaries possess adequate certificates,
authorities or permits issued by appropriate governmental agencies or bodies
necessary to conduct the business now operated by them and have not received any
notice of proceedings relating to the revocation
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or modification of any such certificate, authority or permit that, if determined
adversely to the Issuer or any of its subsidiaries, would individually or in the
aggregate have a material adverse effect on the Issuer and its subsidiaries
taken as a whole.
(k) No labor dispute with the employees of the Issuer or any
subsidiary exists or, to the knowledge of the Issuer, is imminent that might
have a material adverse effect on the Issuer and its subsidiaries taken as a
whole.
(l) The Issuer and its subsidiaries own, possess or can acquire on
reasonable terms, adequate trademarks, trade names and other rights to
inventions, know-how, patents, copyrights, confidential information and other
intellectual property (collectively, "intellectual property rights") necessary
to conduct the business now operated by them, or presently employed by them, and
have not received any notice of infringement of or conflict with asserted rights
of others with respect to any intellectual property rights that, if determined
adversely to the Issuer or any of its subsidiaries, would individually or in the
aggregate have a material adverse effect on the Issuer and its subsidiaries
taken as a whole.
(m) Except as disclosed in the Prospectus, there are no pending
actions, suits or proceedings against or affecting the Issuer, any of its
subsidiaries or any of their respective properties that, if determined adversely
to the Issuer or any of its subsidiaries, would individually or in the aggregate
have a material adverse effect on the condition (financial or other), business,
properties or results of operations of the Issuer and its subsidiaries taken as
a whole, or would materially and adversely affect the ability of the Issuer to
perform its obligations under the Indenture or this Agreement, or which are
otherwise material in the context of the sale of the Securities; and no such
actions, suits or proceedings are threatened or, to the Issuer's knowledge,
contemplated.
(n) The financial statements included in the Registration Statement
and Prospectus present fairly the financial position of the Issuer and its
consolidated subsidiaries as of the dates shown and their results of operations
and cash flows for the periods shown, and, except as otherwise disclosed in the
Prospectus, such financial statements have been prepared in conformity with
generally accepted accounting principles in the United States applied on a
consistent basis; and the schedules included in the Registration Statement
present fairly the information required to be stated therein.
(o) Except as disclosed in the Prospectus, since the date of the
latest audited financial statements included in the Prospectus there has been no
material adverse change, nor any development or event involving a prospective
material adverse change, in the condition (financial or other), business,
properties or results of operations of the Issuer and its subsidiaries taken as
a whole, and, except as disclosed in or contemplated by the Prospectus, there
has been no dividend or distribution of any kind declared, paid or made by the
Issuer on any class of its capital stock.
(p) The Issuer is not and, after giving effect to the offering and
sale of the Securities and the application of the proceeds thereof as described
in the Prospectus, will not be an "investment company," as defined in the
Investment Company Act of 1940.
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(q) Immediately after any sale of Securities by the Issuer hereunder
or under any Terms Agreement (as defined in Section 3(a)(iii)), the aggregate
amount of Securities which shall have been issued and sold by the Issuer
hereunder or under any Terms Agreement and of any Registered Securities of the
Issuer (other than such Securities) that shall have been issued and sold
pursuant to the Registration Statement will not exceed the amount of debt
securities registered under the Registration Statement.
3. APPOINTMENT AS DISTRIBUTOR; AGREEMENT OF DISTRIBUTOR;
SOLICITATIONS.
(a) (i) Subject to the terms and conditions stated herein, the Issuer
hereby appoints the Distributor as the agent of the Issuer for the purpose of
soliciting or receiving offers to purchase the Securities to be issued by the
Issuer during any Marketing Time. For purposes of this Agreement "Marketing
Time" shall mean any time when no suspension of solicitation of offers to
purchase Securities pursuant to Section 3(c) or Section 4(c) shall be in effect
or any time when either the Distributor shall own any Securities with the
intention of reselling them or the Issuer has accepted an offer to purchase
Securities but the related settlement has not occurred.
(ii) So long as this Agreement shall remain in effect, the Issuer
shall not, without the consent of the Distributor, solicit or accept offers to
purchase Securities otherwise than to or through the Distributor; PROVIDED,
HOWEVER, that, subject to all of the terms and conditions of this Agreement, the
foregoing shall not be construed to prevent the Issuer from selling at any time
any Registered Securities in a firm commitment underwriting pursuant to an
underwriting agreement that does not provide for a continuous offering of such
Registered Securities; and PROVIDED, FURTHER, that the Issuer reserves the right
from time to time (i) to sell Securities directly to an investor, and (ii) to
accept a specific offer to purchase Securities solicited by a dealer other than
the Distributor (each an "Other Dealer"), without obtaining the prior consent of
the Distributor, provided that (x) the Issuer shall give the Distributor notice
of its decision to accept such an offer to purchase Securities in advance of
such acceptance and (y) any Other Dealer shall agree to be bound by and subject
to the terms and conditions of this Agreement binding on the Distributor
(including the commission schedule set forth on Exhibit B).
(b) (i) On the basis of the representations and warranties contained
herein, but subject to the terms and conditions herein set forth, the
Distributor agrees, as the agent of the Issuer, to use reasonable efforts when
requested by the Issuer to solicit offers to purchase the Securities upon the
terms and conditions set forth in the Prospectus, as from time to time amended
or supplemented.
(ii) The Distributor shall not have any obligation to purchase
Securities from the Issuer; however, the Distributor may agree from time to time
to purchase Securities as principal for resale to investors and other purchasers
selected by the Distributor. Unless otherwise expressly agreed by the Issuer and
the Distributor as contemplated by clause (v) below, each offer to sell
Securities transmitted by the Distributor and accepted by the Issuer shall
constitute acceptance of an offer to sell such Securities to the Distributor for
resale. In addition, if so specified in a Terms Agreement executed by the Issuer
and the Distributor, the Distributor shall act as representative of the several
underwriters named in such Terms Agreement for resale of the Securities
specified in such Terms Agreement upon the terms and subject to the conditions
specified in such Terms Agreement, this Agreement and in the Prospectus, as
supplemented by
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the applicable pricing supplement. It is understood that the Distributor and any
underwriters for which it may act as representative propose that they will offer
any Securities which they agree to purchase as principal for sale as set forth
in the Prospectus, as supplemented by the applicable Pricing Supplement.
(iii) Upon acceptance by the Issuer of an offer by the Distributor to
purchase Securities as principal, unless the Issuer and the Distributor execute
a Terms Agreement substantially in the form of Exhibit A hereto (a "Terms
Agreement"), any written confirmation or communication transmitted by the
Distributor to the Issuer or, in the absence of a Terms Agreement or such other
written confirmation or communication, the oral agreement with respect to the
terms of the Securities and of their offer and sale evidenced by the offer
communicated by the Distributor and accepted by the Issuer, in each case
together with the provisions of this Agreement, shall constitute an agreement
between the Distributor and the Issuer for the sale and purchase of such
Securities (whether or not any Terms Agreement or other written confirmation or
communication shall have been executed by the Issuer or the Distributor). Each
purchase of Securities by the Distributor shall, unless otherwise agreed, be at
a discount from the principal amount of each such Security equivalent to the
applicable commission set forth in Exhibit B hereto.
(iv) The Distributor is authorized to engage the services of any other
brokers or dealers in connection with the offer or sale of Securities purchased
by the Distributor as principal for resale to others and may reallow any portion
of the discount received from the Issuer to such brokers or dealers.
(v) If expressly agreed by the Distributor and the Issuer, the
Distributor will solicit offers to purchase Securities from the Issuer through
the Distributor, acting as agent, in accordance with the provisions of this
Agreement. In such event, the Distributor shall communicate to the Issuer,
orally or in writing, each reasonable offer to purchase Securities received by
it as agent; and the Issuer shall have the sole right to accept offers to
purchase the Securities and may reject any such offer, in whole or in part. The
Distributor shall have the right, in its discretion reasonably exercised,
without notice to the Issuer, to reject any offer to purchase Securities
received by it as such agent, in whole or in part, and any such rejection shall
not be deemed a breach of its agreement contained herein. At the time of
delivery of, and payment for, any Securities sold by the Issuer as a result of a
solicitation made by, or offer to purchase received by, the Distributor, acting
on an agency basis, the Issuer agrees to pay the Distributor a commission in
accordance with the schedule set forth in Exhibit B hereto.
(vi) The Distributor shall not have any responsibility for maintaining
records with respect to the aggregate principal amount of Securities sold, or
otherwise monitoring the availability of Securities for sale, under the
Registration Statement.
(vii) No Security which the Issuer has agreed to sell pursuant to this
Agreement shall be deemed to have been purchased and paid for, or sold by the
Issuer, until such Security shall have been delivered to the purchaser thereof
against payment by such purchaser.
(c) Upon receipt of notice from the Issuer as contemplated by Section
4(c) hereof, the Distributor shall suspend its solicitation of offers to
purchase Securities until such time as the
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Issuer shall have furnished it with an amendment or supplement to the
Registration Statement or the Prospectus, as the case may be, contemplated by
Section 4(c) and shall have advised the Distributor that such solicitation may
be resumed.
The Issuer reserves the right, in its sole discretion, to suspend
solicitation of offers to purchase the Securities commencing at any time for any
period of time or permanently. Upon receipt of at least one Business Day's prior
notice from the Issuer, the Distributor will forthwith suspend solicitation of
offers to purchase Securities from the Issuer until such time as the Issuer has
advised the Distributor that such solicitation may be resumed. For the purpose
of the foregoing sentence, "Business Day" shall mean any day that is not a
Saturday or Sunday, and that in The City of New York is not a day on which
banking institutions generally are authorized or obligated by law or executive
order to close.
(d) Administrative procedures respecting the sale of Securities (the
"Procedures") shall be agreed upon from time to time by the Distributor and the
Issuer. The initial Procedures, which are set forth in Exhibit C hereto, shall
remain in effect until changed by agreement between the Issuer and the
Distributor. The Distributor and the Issuer agree to perform the respective
duties and obligations specifically provided to be performed by each of them
herein and in the Procedures. The Issuer will furnish to the Trustee a copy of
the Procedures as from time to time in effect.
(e) The documents required to be delivered by Section 5 hereof shall
be delivered at the office of Cleary, Gottlieb, Xxxxx & Xxxxxxxx, Xxx Xxxxxxx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, not later than 9:30 A.M., New York City time,
on the date of this Agreement or at such later time as may be mutually agreed by
the Issuer and the Distributor, which in no event shall be later than the time
at which the Distributor commences solicitation of purchases of Securities
hereunder, such time and date being herein called the "Closing Date". For
purposes of Rule 15c6-1 under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), the settlement date (if later than the otherwise
applicable settlement date) shall be the date for payment of funds and delivery
of securities for all the Securities sold pursuant to an offering of Securities
having identical terms (including the issue date) and terms of sale (whether or
not set forth in a single Terms Agreement).
4. CERTAIN AGREEMENTS OF THE ISSUER. The Issuer agrees with the
Distributor that it will furnish to Cleary, Gottlieb, Xxxxx & Xxxxxxxx, counsel
for the Distributor, one signed copy of the Registration Statement, including
all exhibits, in the form it became effective and of all amendments and
supplements thereto and that, in connection with each offering of Securities:
(a) The Issuer will prepare a Pricing Supplement with respect to any
Securities to be offered and sold to or through the Distributor pursuant to this
Agreement and, after approval of such Pricing Supplement by the Distributor,
will file such Pricing Supplement with the Commission pursuant to and in
accordance with Rule 424(b) under the Act.
(b) The Issuer will advise the Distributor promptly of any proposal to
amend or supplement the Registration Statement or the Prospectus and will afford
the Distributor a reasonable opportunity to comment on any such proposed
amendment or supplement (other than any Pricing Supplement that relates to
Securities not purchased through or by such Distributor),
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and if the Issuer effects any amendment or supplementation of the Registration
Statement or the Prospectus to which the Distributor objects, the Distributor
shall be relieved of its obligations under Section 3(b) to solicit offers to
purchase Securities until such time as the Issuer shall have filed such further
amendments or supplements such that the Distributor is reasonably satisfied with
the Registration Statement and the Prospectus, as then amended or supplemented;
and the Issuer will also advise the Distributor promptly of the filing and
effectiveness of any such amendment or supplement and of the institution by the
Commission of any stop order proceedings in respect of the Registration
Statement or of any part thereof and will use its best efforts to prevent the
issuance of any such stop order and to obtain as soon as possible its lifting,
if issued.
(c) If, at any time when a prospectus relating to the Securities is
required to be delivered under the Act, any event occurs as a result of which
the Prospectus, as then amended or supplemented, would include an untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading, or if it is
necessary at any such time to amend the Prospectus to comply with the Act, the
Issuer will promptly notify the Distributor by telephone (with confirmation in
writing) to suspend solicitation of offers to purchase the Securities and to
cease making offers or sales of Securities which a Distributor may then own as
principal; and if the Issuer shall decide to amend or supplement the
Registration Statement or the Prospectus, it will promptly advise the
Distributor by telephone (with confirmation in writing) and, subject to the
provisions of subsection (a) of this Section, will promptly prepare and file
with the Commission an amendment or supplement which will correct such statement
or omission or an amendment which will effect such compliance. Notwithstanding
the foregoing, if, at the time any such event occurs or it becomes necessary to
amend the Prospectus to comply with the Act, the Distributor shall own any of
the Securities with the intention of reselling them, or the Issuer has accepted
an offer to purchase Securities but the related settlement has not occurred, the
Issuer, subject to the provisions of subsection (a) of this Section, will
promptly prepare and file with the Commission an amendment or supplement which
will correct such statement or omission or an amendment which will effect such
compliance. Neither the Distributor's consent to, nor its delivery of, any such
amendment or supplement shall constitute a waiver of any of the conditions set
forth in Section 5.
(d) The Issuer will file promptly all documents required to be filed
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act. In addition, on or prior to the date on which the Issuer makes any
announcement to the general public concerning earnings or concerning any other
event which is required to be described, or which the Issuer proposes to
describe, in a document filed pursuant to the Exchange Act, the Issuer will
furnish the information contained or to be contained in such announcement to the
Distributor, confirmed in writing and, subject to the provisions of subsections
(a) and (b) of this Section, will cause the Prospectus to be amended or
supplemented to reflect the information contained in such announcement. The
Issuer also will furnish the Distributor with copies of all press releases or
announcements to the general public.
(e) The Issuer will immediately notify the Distributor of any
downgrading in the rating of any debt
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securities of the Issuer or any proposal to downgrade the rating of any debt
securities of the Issuer by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act), or any
public announcement that any such organization has under surveillance or review
its rating of any debt securities of the Issuer (other than an announcement with
positive implications of a possible upgrading, and no implication of a possible
downgrading of such rating), as soon as the Issuer learns of such downgrading,
proposal to downgrade or public announcement.
(f) As soon as practicable, but not later than 16 months, after the
date of each acceptance by the Issuer of an offer to purchase Securities
hereunder, the Issuer will make generally available to its securityholders an
earnings statement covering a period of at least 12 months beginning after the
later of (i) the effective date of the Registration Statement relating to the
Registered Securities, (ii) the effective date of the most recent post-effective
amendment to the Registration Statement to become effective prior to the date of
such acceptance and (iii) the date of the Issuer's most recent Annual Report on
Form 10-K filed with the Commission prior to the date of such acceptance, which
will satisfy the provisions of Section 11(a) of the Act.
(g) The Issuer will furnish to the Distributor copies of the
Registration Statement, including all exhibits, any related preliminary
prospectus, any related preliminary prospectus supplement, the Prospectus and
all amendments and supplements to such documents (including any Pricing
Supplement), in each case as soon as available and in such quantities as are
reasonably requested.
(h) The Issuer will arrange for the qualification of the Securities
for sale and the determination of their eligibility for investment under the
laws of such jurisdictions as the Distributor designates and will continue such
qualifications in effect so long as required for the distribution.
(i) So long as any Securities are outstanding, the Issuer will furnish
to the Distributor, (i) as soon as practicable after the end of each fiscal
year, a copy of its annual report to stockholders for such year, if any, (ii) as
soon as available, a copy of each report or definitive proxy statement of the
Issuer filed with the Commission under the Exchange Act or mailed to
stockholders, if any, and (iii) from time to time, such other information
concerning the Issuer as the Distributor may reasonably request.
(j) The Issuer will pay, or reimburse the Distributor for, all
expenses incident to the performance of its obligations under this Agreement
and will reimburse the Distributor for any expenses (including fees and
disbursements of counsel) incurred by it in connection with qualification of
the Securities for sale and determination of their eligibility for investment
under the laws of such jurisdictions as the Distributor may designate and the
printing of memoranda relating thereto, for any fees charged by investment
rating agencies for the rating of the Securities, for any filing fee incident
to, and the reasonable fees and disbursements of counsel to the Distributor
in connection with, review by the National Association of Securities Dealers,
Inc. relating to the Securities, for expenses incurred by the Distributor in
distributing the Prospectus and all supplements thereto (including any
Pricing Supplement), any preliminary prospectuses and any preliminary
prospectus supplements, for costs incurred by the Distributor in advertising
any offering of Securities and for the Distributor's reasonable expenses
(including the reasonable fees and disbursements of counsel to the
Distributor) incurred in
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connection with the establishment or maintenance of the program contemplated by
this Agreement or otherwise in connection with the activities of the Distributor
under this Agreement.
(l) Between the date on which the Distributor agrees to purchase
Securities from the Issuer as principal for resale and the date of delivery of
such Securities, the Issuer will not offer or sell, or enter into any agreement
to sell, pledge, or otherwise dispose of, directly or indirectly, or file with
the Commission a registration statement under the Act relating to any of its
debt securities (other than such Securities) in the United States, other than
borrowings under the Issuer's revolving credit agreements and lines of credit,
the private placement of securities and issuances of its commercial paper, or
publicly disclose the intention to make any such offer, sale, pledge or
disposition or filing.
5. CONDITIONS OF OBLIGATIONS. The obligations of the Distributor, as
agent of the Issuer, under this Agreement at any time to solicit offers to
purchase the Securities and to purchase Securities from the Issuer as principal
is subject to the accuracy, on the date hereof, on each Representation Date and
on the date of each such solicitation, of the representations and warranties of
the Issuer herein, to the accuracy, on each such date, of the statements of the
Issuer's officers made pursuant to the provisions hereof, to the performance, on
or prior to each such date, by the Issuer of its obligations hereunder, and to
each of the following additional conditions precedent:
(a) The Prospectus, as amended or supplemented as of any
Representation Date or date of such solicitation, as the case may be, shall have
been filed with the Commission in accordance with the Rules and Regulations and
no stop order suspending the effectiveness of the Registration Statement or of
any part thereof shall have been issued and no proceedings for that purpose
shall have been instituted or, to the knowledge of the Issuer or the
Distributor, shall be contemplated by the Commission.
(b) Neither the Registration Statement nor the Prospectus, as amended
or supplemented as of any Representation Date or date of such solicitation, as
the case may be, shall contain any untrue statement of fact which, in the
opinion of the Distributor, is material or omits to state a fact which, in the
opinion of the Distributor, is material and is required to be stated therein or
is necessary to make the statements therein not misleading.
(c) There shall not have occurred (i) any change, or any development
or event involving a prospective change, in the condition (financial or other),
business, properties or results of operations of the Issuer or its subsidiaries
which, in the judgment of the Distributor, is material and adverse and makes it
impractical or inadvisable to proceed with completion of the public offering or
the sale of and payment for the Securities; (ii) any downgrading in the rating
of any debt securities of the Issuer by any "nationally recognized statistical
rating organization" (as defined for purposes of Rule 436(g) under the Act), or
any public announcement that any such organization has under surveillance or
review its rating of any debt securities of the Issuer (other than an
announcement with positive implications of a possible upgrading, and no
implication of a possible downgrading, of such rating); (iii) any suspension or
limitation of trading in securities generally on the New York Stock Exchange, or
any setting of minimum prices for trading on such exchange, or any suspension of
trading of any securities of the Issuer on any exchange or in the
over-the-counter market; (iv) any banking moratorium declared by U.S. Federal or
New York
10
authorities; or (v) any outbreak or escalation of major hostilities in which the
United States is involved, any declaration of war by Congress or any other
substantial national or international calamity or emergency if, in the judgment
of the Distributor, the effect of any such outbreak, escalation, declaration,
calamity or emergency makes it impractical or inadvisable to proceed with
solicitations of offers to purchase, or sales of, Securities.
(d) With respect to any Security denominated in a currency other than
the U.S. dollar, more than one currency or a composite currency or any Security
the principal or interest of which is indexed to such currency, currencies or
composite currency, there shall not have occurred a suspension or material
limitation in foreign exchange trading in such currency, currencies or composite
currency by a major international bank, a general moratorium on commercial
banking activities in the country or countries issuing such currency, currencies
or composite currency, the outbreak or escalation of hostilities involving, the
occurrence of any material adverse change in the existing financial, political
or economic conditions of, or the declaration of war or a national emergency by,
the country or countries issuing such currency, currencies or composite currency
or the imposition or proposal of exchange controls by any governmental authority
in the country or countries issuing such currency, currencies or composite
currency.
(e) At the Closing Date and, if specified in a Terms Agreement, if
any, at the time of delivery of the Securities described in such Terms
Agreement, the Distributor shall have received an opinion, dated the Closing
Date, or such date of delivery, as the case may be, of the General Counsel of
the Issuer to the effect that:
(i) The Issuer is an existing corporation in good standing under
the laws of the State of Delaware, with corporate power and authority to own its
properties and conduct its business as described in the Prospectus; and the
Issuer is duly qualified to do business as a foreign corporation in good
standing in all other jurisdictions in which its ownership or lease of property
or the conduct of its business requires such qualification;
(ii) The Indenture has been duly authorized, executed and
delivered by the Issuer and has been duly qualified under the Trust Indenture
Act and constitutes a valid and legally binding obligation of the Issuer
enforceable in accordance with its terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general equity
principles;
(iii) Securities established on or prior to the date of such
opinion has been duly authorized and established in conformity with the
Indenture, and, when the terms of a particular Security and of its issuance and
sale have been duly authorized and established by all necessary corporate action
in conformity with the Indenture, and such Security has been duly completed,
executed, authenticated and issued in accordance with the Indenture and
delivered against payment as contemplated by this Agreement, such Security will
constitute a valid and legally binding obligation of the Issuer enforceable in
accordance with its terms, subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditors' rights and to general equity principles, it
being understood that such counsel may (a) assume that at the time of the
issuance, sale and delivery of each Security the authorization of such series
will not have been modified or
11
rescinded and there will not have occurred any change in law affecting the
validity, legally binding character or enforceability of such Security, (b)
assume that neither the issuance, sale and delivery of any Security, nor any of
the terms of such Security, nor compliance by the Issuer with such terms, will
violate any applicable law, any agreement or instrument then binding upon the
Issuer or any restriction imposed by any court or governmental body having
jurisdiction over the Issuer, and (c) state that as of the date of such opinion
a judgment for money in an action based on Securities denominated in foreign
currencies or currency units 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
currency or currency unit in which a particular Security is denominated into
United States dollars will depend upon various factors, including which court
renders the judgment;
(iv) The Registration Statement has become effective under the
Act, the Prospectus was filed with the Commission pursuant to the subparagraph
of Rule 424(b) under the Act specified in such opinion on the date specified
therein, and, to the best of the knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement or of any part
thereof has been issued and no proceedings for that purpose have been instituted
or are pending or contemplated under the Act, and the Registration Statement
relating to the Registered Securities, as of its effective date, the
Registration Statement and the Prospectus, as of the Closing Date, and any
amendment or supplement thereto, as of its date, complied as to form in all
material respects with the requirements of the Act, the Trust Indenture Act and
the Rules and Regulations; such counsel has no reason to believe that such
registration statement as of its effective date, the Registration Statement or
the Prospectus, as of the Closing Date, or any such amendment or supplement, as
of its date, contained any untrue statement of a material fact or omitted to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading; the descriptions in the Registration
Statement and the Prospectus of statutes, legal and governmental proceedings and
contracts and other documents are accurate and fairly present the information
required to be shown; and such counsel do not know of any legal or governmental
proceedings required to be described in the Prospectus which are not described
as required or of any contracts or documents of a character required to be
described in the Registration Statement or the Prospectus or to be filed as
exhibits to the Registration Statement which are not described and filed as
required; it being understood that such counsel need express no opinion as to
the financial statements or other financial data contained in the Registration
Statement or the Prospectus;
(v) No consent, approval, authorization or order of, or filing
with, any governmental agency or body or any court is required for the
consummation of the transactions contemplated by this Agreement in connection
with the issuance and sale of the Securities by the Issuer, except such as have
been obtained and made under the Act and the Trust Indenture Act and such as may
be required under state securities laws (it being understood that such counsel
may assume with respect to each particular Security that the inclusion of any
alternative or additional terms in such Security that are not currently
specified in the draft forms of Securities examined by such counsel would not
require the Issuer to obtain any regulatory consent, authorization or approval
or make any regulatory filing in order for the Issuer to issue, sell and deliver
such Security);
12
(vi) The execution, delivery and performance of the Indenture,
this Agreement and the issuance and sale of the Securities, and compliance with
the terms and provisions thereof, will not result in a breach or violation of
any of the terms and provisions of, or constitute a default under, any statute,
any rule, regulation or order of any governmental agency or body or any court
having jurisdiction over the Issuer or any subsidiary of the Issuer or any of
their properties or any material agreement or instrument to which the Issuer or
any such subsidiary is a party or by which the Issuer or any such subsidiary is
bound or to which any of the properties of the Issuer or any such subsidiary is
subject, or the charter or by-laws of the Issuer or any such subsidiary, and the
Issuer has full power and authority to authorize, issue and sell the Securities
as contemplated by this Agreement (it being understood that such counsel may
assume with respect to each particular Security that the inclusion of any
alternative or additional terms in such Security that are not currently
specified in the draft forms of Securities examined by such counsel will not
cause the issuance, sale or delivery of such Security, the terms of such
Security, or the compliance by the Issuer with such terms, to violate any of the
court orders or laws specified in this paragraph or to result in a default under
or a breach of any of the agreements specified in this paragraph); and
(vii) This Agreement has been duly authorized, executed
and delivered by the Issuer;
PROVIDED, HOWEVER, that, in the case of each such opinion delivered pursuant to
a Terms Agreement, (x) the statements contained in such opinion relating to the
Registration Statement or the Prospectus shall relate to the Registration
Statement or the Prospectus, as the case may be, as amended or supplemented as
of the date of the Issuer's acceptance of the offer to purchase such Securities
and as of the time of delivery of such Securities; (y) such opinion shall relate
to the Securities being delivered on the date of such opinion and not to other
Securities as well; and (z) in lieu of the opinion described in clause (iii),
such opinion shall state that the Securities being delivered on the date of such
opinion, when delivered against payment therefor as contemplated by this
Agreement, will have been duly executed, authenticated, issued and delivered and
will constitute valid and legally binding obligations of the Issuer enforceable
in accordance with their terms, subject only to the exceptions set forth in
clause (iii) as to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and general equity principles, and will conform to the
description thereof contained in the Prospectus as amended or supplemented at
such date of delivery.
(f) At the Closing Date and, if specified in a Terms Agreement, if
any, at the time of delivery of the Securities described in such Terms
Agreement, the Distributor shall have received a certificate, dated the Closing
Date or such date of delivery, as the case may be, signed by any two of the
chairman of the board of directors, the chief executive officer, the president,
the chief financial officer, the chief administrative officer, the chief
accounting officer and any Managing Director of the Issuer in which such
officers, to the best of their knowledge after reasonable investigation, shall
state that the representations and warranties of the Issuer in this Agreement
are true and correct, that the Issuer has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied hereunder at
or prior to the Closing Date or such date of delivery, as the case may be, that
no stop order suspending the effectiveness of the
13
Registration Statement or of any part thereof has been issued and no proceedings
for that purpose have been instituted or are contemplated by the Commission, and
that subsequent to the date of the most recent financial statements in the
Prospectus, there has been no material adverse change, nor any development or
event involving a prospective material adverse change, in the condition
(financial or otherwise), business, properties or results of operations of the
Issuer and its subsidiaries taken as a whole, except as set forth in or
contemplated by the Prospectus or as described in such certificate. In the case
of each such certificate delivered pursuant to a Terms Agreement, the statements
contained in such certificate relating to the Registration Statement or the
Prospectus shall relate to the Registration Statement or the Prospectus, as the
case may be, as amended or supplemented as of the date of the Issuer's
acceptance of the offer to purchase such Securities and as of the time of
delivery of such Securities.
(g) At the Closing Date and, if specified in a Terms Agreement, if
any, at the time of delivery of the Securities described in such Terms
Agreement, the Distributor shall have received a letter, dated the Closing Date
or such date of delivery, as the case may be, of KPMG LLP, confirming that they
are independent public accountants within the meaning of the Act and the
applicable published Rules and Regulations thereunder and stating to the effect
that:
(i) in their opinion, the financial statements and schedules and
summary of earnings, if any, examined by them and included in the Prospectus
comply as to form in all material respects with the applicable accounting
requirements of the Act and the related published Rules and Regulations;
(ii) they have performed the procedures specified by the American
Institute of Certified Public Accountants for a review of interim financial
information as described in Statement of Auditing Standards No. 71, Interim
Financial Information, on any unaudited financial statements included in the
Registration Statement;
(iii) on the basis of the review, if any, referred to in clause
(ii) above, a reading of the latest available interim financial statements of
the Issuer, inquiries of officials of the Issuer who have responsibility for
financial and accounting matters and other specified procedures, nothing came
to their attention that caused them to believe that:
(A) the unaudited financial statements, if any, and any summary
of earnings included in the Prospectus do not comply as to form in all material
respects with the applicable accounting requirements of the Act and the related
published Rules and Regulations or any material modifications should be made to
such unaudited financial statements and summary of earnings for them to be in
conformity with generally accepted accounting principles;
(B) if any unaudited "capsule" information is contained in the
Prospectus, the unaudited consolidated net revenues, income before provision
for income taxes and extraordinary items, net income or other amounts
constituting such "capsule" information and described in such letter for the
three-, six- and nine-month periods ended March 31, June 30 and September 30,
respectively, included in the Prospectus, as applicable, do not agree with the
corresponding amounts set forth in the unaudited consolidated financial
statements for those same periods or were not determined on a basis
substantially consistent with that of the corresponding amounts in the audited
statements of income;
14
(C) at the date of the latest available balance sheet read by
such accountants, or at a subsequent specified date not more than three
business days prior to the date of this Agreement, there was any change in the
capital stock or any increase in short-term indebtedness or long-term debt of
the Issuer and its consolidated subsidiaries or, at the date of the latest
available balance sheet read by such accountants, there was any decrease in
consolidated net assets, as compared with amounts shown on the latest balance
sheet included in the Prospectus; or
(D) for the period from the closing date of the latest available
income statement included in the Prospectus to the closing date of the latest
available income statement read by such accountants there were any decreases,
as compared with the corresponding period of the previous year and with the
period of corresponding length ended the date of the latest income statement
included in the Prospectus, in consolidated net revenues, income before
provision for income taxes and extraordinary items, net income or in the ratio
of earnings to fixed charges and in the ratio of earnings to combined fixed
charges and preferred stock dividends;
except in all cases set forth in clauses (C) and (D) above, for
changes, increases or decreases which the Prospectus discloses have occurred or
may occur or which are described in such letter; and
(iv) they have compared specified dollar amounts (or percentages
derived from such dollar amounts) and other financial information contained in
the Registration Statement (in each case to the extent that such dollar
amounts, percentages and other financial information are derived from the
general accounting records of the Issuer and its subsidiaries subject to the
internal controls of the Issuer's accounting system or are derived directly
from such records by analysis or computation) with the results obtained from
inquiries, a reading of such general accounting records and other procedures
specified in such letter and have found such dollar amounts, percentages and
other financial information to be in agreement with such results, except as
otherwise specified in such letter.
All financial statements and schedules included in material
incorporated by reference into the Prospectus shall be deemed included in the
Prospectus for purposes of this subsection.
In the case of each such letter delivered pursuant to a Terms
Agreement, the statements contained in such letter relating to the Registration
Statement or the Prospectus shall relate to the Registration Statement or the
Prospectus, as the case may be, as amended or supplemented as of the date of the
Issuer's acceptance of the offer to purchase such Securities and as of the time
of delivery of such Securities.
(h) At the Closing Date and, if specified in a Terms Agreement, if
any, at the time of delivery of the Securities described in such Terms
Agreement, the Distributor shall have received from Cleary, Gottlieb, Xxxxx &
Xxxxxxxx, counsel for the Distributor, such opinion or opinions, dated the
Closing Date or such date of delivery, as the case may be, with respect to the
validity of the Securities, the Registration Statement, the Prospectus and other
related matters as the Distributor may require, and the Issuer shall have
furnished to such counsel such documents as they request for the purpose of
enabling them to pass upon such matters.
15
(i) The Issuer shall have furnished to the Distributor or its counsel
such further certificates and documents as the Distributor or such counsel
requests.
The Issuer will furnish the Distributor with such conformed copies of
such opinions, certificates, letters and documents as it reasonably requests.
6. ADDITIONAL COVENANTS OF THE ISSUER. The Issuer agrees that:
(a) Each acceptance by the Issuer of an offer for the purchase of
Securities shall be deemed to be an affirmation that its representations and
warranties contained in this Agreement are true and correct at the time of such
acceptance and a covenant that such representations and warranties will be true
and correct at the time of delivery to the purchaser of the Securities 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 the Prospectus as
amended or supplemented at each such time. Each such acceptance by the Issuer of
an offer to purchase Securities shall be deemed to constitute an additional
representation, warranty and agreement by the Issuer that, as of the date of
delivery of such Securities to the purchaser thereof, after giving effect to the
issuance of such Securities, of any other Securities to be issued on or prior to
such delivery date and of any other Registered Securities to be issued and sold
by the Issuer on or prior to such delivery date, the aggregate amount of
Registered Securities (including any Securities) which have been issued and sold
by the Issuer will not exceed the amount of Registered Securities registered
pursuant to the Registration Statement.
(b) Each time that the Registration Statement or the Prospectus
shall be amended or supplemented (other than by a Pricing Supplement), the
Issuer shall, unless otherwise waived by the Distributor, (A) concurrently
with such amendment or supplement, if such amendment or supplement shall
occur at a Marketing Time, or (B) immediately at the next Marketing Time if
such amendment or supplement shall not occur at a Marketing Time, furnish the
Distributor with a certificate, dated the date of delivery thereof, of the
chairman of the board of directors, the chief executive officer, the
president, the chief financial officer, the chief administrative officer, the
chief accounting officer and any Managing Director of the Issuer, in form
satisfactory to the Distributor, to the effect that the statements contained
in the certificate covering the matters set forth in Section 5(f) hereof
which was last furnished to the Distributor pursuant to this Section 6(b) are
true and correct at the time of such amendment or supplement, as though made
at and as of such time or, in lieu of such certificate, a certificate of the
same tenor as the certificate referred to in Section 5(f); PROVIDED, HOWEVER,
that any certificate furnished under this Section 6(b) shall relate to the
Registration Statement and the Prospectus as amended or supplemented at the
time of delivery of such certificate and, in the case of the matters set
forth in clause (ii) of Section 5(f), to the time of delivery of such
certificate.
(c) At each Representation Date referred to in Section 6(b), the
Issuer shall, unless otherwise waived by the Distributor, (A) concurrently if
such Representation Date shall occur at a Marketing Time, or (B) immediately at
the next Marketing Time if such Representation Date shall not occur at a
Marketing Time, furnish the Distributor with a written opinion or opinions,
dated the date of such Representation Date, of counsel for the Issuer, in form
satisfactory to the Distributor, to the effect set forth in Section 5(e) hereof;
PROVIDED, HOWEVER, that to the extent appropriate such opinion or opinions may
reconfirm matters set forth in a prior opinion delivered at the Closing Date or
under this Section 6(c); PROVIDED FURTHER, HOWEVER, that
16
any opinion or opinions furnished under this Section 6(c) shall relate to the
Registration Statement and the Prospectus as amended or supplemented at such
Representation Date and shall state that the Securities sold in the relevant
Applicable Period (as defined below) have been duly executed, authenticated,
issued and delivered and constitute valid and legally binding obligations of the
Issuer enforceable in accordance with their terms, subject only to the
exceptions set forth in clause (iii) of Section 5(e) hereof as to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights and general
equity principles, and conform to the description thereof contained in the
Prospectus as amended or supplemented at the relevant date or dates for the
delivery of such Securities to the purchaser or purchasers thereof. For the
purpose of this Section 6(c), "Applicable Period" shall mean with respect to any
opinion delivered on a Representation Date the period commencing on the date as
of which the most recent prior opinion delivered at the Closing Date or under
this Section 6(c) speaks and ending on such Representation Date.
(d) At each Representation Date referred to in Section 6(b) on which
the Registration Statement or the Prospectus shall be amended or supplemented to
include additional financial information, the Issuer shall cause KPMG LLP,
unless otherwise waived by the Distributor, (A) concurrently if such
Representation Date shall occur at a Marketing Time, or (B) immediately at the
next Marketing Time if such Representation Date shall not occur at a Marketing
Time, to furnish the Distributor with a letter, addressed jointly to the Issuer
and the Distributor and dated the date of such Representation Date, in form and
substance satisfactory to the Distributor, to the effect set forth in Section
5(g) hereof; PROVIDED, HOWEVER, that to the extent appropriate such letter may
reconfirm matters set forth in a prior letter delivered at the Closing Date or
pursuant to this Section 6(d); PROVIDED FURTHER, HOWEVER, that any letter
furnished under this Section 6(d) shall relate to the Registration Statement and
the Prospectus as amended or supplemented at such Representation Date, with such
changes as may be necessary to reflect changes in the financial statements and
other information derived from the accounting records of the Issuer.
(e) On each date for the delivery of Securities to the purchaser
thereof, the Issuer shall, if requested by the Distributor, furnish the
Distributor with a written opinion or opinions, dated the date of delivery
thereof, of counsel for the Issuer, in form satisfactory to the Distributor, to
the effect set forth in clauses (i), (ii) and (iii) of Section 5(e) hereof;
PROVIDED, HOWEVER, that any opinion furnished under this Section 6(e) shall
relate to the Prospectus as amended or supplemented at such delivery date and
shall state that the Securities being sold by the Issuer on such delivery date,
when delivered against payment therefor as contemplated by this Agreement, will
have been duly executed, authenticated, issued and delivered and will constitute
valid and legally binding obligations of the Issuer enforceable in accordance
with their terms, subject only to the exceptions set forth in clause (iii) of
Section 5(e) hereof as to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditors' rights and general equity principles, and will conform
to the description thereof contained in the Prospectus as amended or
supplemented at such settlement date.
(f) The Issuer agrees that any obligation of a person who has agreed
to purchase Securities to make payment for and take delivery of such Securities
shall be subject to (i) the accuracy, on the related settlement date fixed
pursuant to the Procedures, of the Issuer's
17
representation and warranty deemed to be made to the Distributor pursuant to the
last sentence of subsection (a) of this Section 6, and (ii) the satisfaction, on
such settlement date, of each of the conditions set forth in Sections 5(a), (b)
and (c), it being understood that under no circumstance shall the Distributor
have any duty or obligation to exercise the judgment permitted under Section
5(b) or (c) on behalf of any such person.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Issuer will indemnify and hold harmless the Distributor
against any losses, claims, damages or liabilities, joint or several, to which
the Distributor may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, the Prospectus, or any
amendment or supplement thereto, or any related preliminary prospectus or
preliminary prospectus supplement, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
will reimburse the Distributor for any legal or other expenses reasonably
incurred by the Distributor in connection with investigating or defending any
such loss, claim, damage, liability or action as such expenses are incurred;
PROVIDED, HOWEVER, that the Issuer will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in any of such documents in reliance upon and in conformity with
written information furnished to the Issuer by the Distributor specifically for
use therein, unless such loss, claim, damage or liability arises out of the
offer or sale of Securities occurring after the Distributor has notified the
Issuer in writing that such information should no longer be used therein, it
being understood and agreed that the only such information furnished by the
Distributor consists of the information described as such in subsection (b)
below.
(b) The Distributor will indemnify and hold harmless the Issuer
against any losses, claims, damages or liabilities to which the Issuer may
become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, the Prospectus or any amendment or
supplement thereto, or any related preliminary prospectus or preliminary
prospectus supplement, or arise out of or are based upon the omission or the
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Issuer by the Distributor
specifically for use therein, and will reimburse any legal or other expenses
reasonably incurred by the Issuer in connection with investigating or defending
any such loss, claim, damage, liability or action as such expenses are incurred,
unless such loss, claim, damage or liability arises out of the offer or sale of
Securities occurring after the Distributor has notified the Issuer in writing
that such information should no longer be used therein, it being understood and
agreed that the only such information furnished by the Distributor consists of
the following information in the Prospectus furnished on behalf of the
Distributor: (i) the ninth paragraph under the caption "Plan of Distribution"
relating to the
18
Distributor's market stabilization activities in the prospectus supplement; and
(ii) the last paragraph under the caption "Plan of Distribution" in the
prospectus supplement.
(c) Promptly after receipt by an indemnified party under this Section
7 of notice of the commencement of any action, such indemnified party will, if a
claim in respect thereof is to be made against the indemnifying party under
subsection (a) or (b) above, notify the indemnifying party of the commencement
thereof; but the omission so to notify the indemnifying party will not relieve
it from any liability which it may have to any indemnified party otherwise than
under subsection (a) or (b) above. In case any such action is brought against
any indemnified party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein and, to the extent that it may wish, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party will not be
liable to such indemnified party under this Section 7 for any legal or other
expenses subsequently incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of investigation. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability on any claims
that are the subject matter of such action.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then the indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Issuer on the one hand and the Distributor on the other from the offering
pursuant to this Agreement of the Securities which are the subject of the action
or (ii) if the allocation provided by clause (i) above 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 Issuer on the one hand and the Distributor on the other in connection with
the statements or omissions which resulted in such losses, claims, damages or
liabilities as well as any other relevant equitable considerations. The relative
benefits received by the Issuer on the one hand and the Distributor on the other
shall be deemed to be in the same proportions as the total net proceeds from the
offering pursuant to this Agreement of the Securities which are the subject of
the action (before deducting expenses) received by the Issuer bear to the total
discounts and commissions received by the Distributor from the offering of such
Securities pursuant to this Agreement. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Issuer or the Distributor and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The amount paid by an
indemnified party as a result of the losses, claims, damages or liabilities
referred to in the first sentence of this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with
19
investigating or defending any action or claim which is the subject of this
subsection (d). Notwithstanding the provisions of this subsection (d), the
Distributor shall not be required to contribute any amount in excess of the
amount by which the total price at which the Securities which are the subject of
the action and which were distributed to the public through it pursuant to this
Agreement or upon resale of Securities purchased by it from the Issuer exceeds
the amount of any damages which the Distributor has otherwise been required to
pay by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
(e) The obligations of the Issuer under this Section 7 shall be in
addition to any liability which the Issuer may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls the
Distributor within the meaning of the Act; and the obligations of the
Distributor under this Section 7 shall be in addition to any liability which the
Distributor may otherwise have and shall extend, upon the same terms and
conditions, to each director of the Issuer, to each officer of the Issuer who
has signed the Registration Statement and to each person, if any, who controls
the Issuer within the meaning of the Act.
8. STATUS OF THE DISTRIBUTOR. In soliciting offers to purchase the
Securities from the Issuer pursuant to this Agreement and in assuming its other
obligations hereunder (other than any obligation to purchase Securities pursuant
to Section 3 hereof), the Distributor is acting solely as agent for the Issuer
and not as principal. In connection with the placement of any Securities by a
Distributor, acting as agent, (a) the Distributor will make reasonable efforts
to assist the Issuer in obtaining performance by each purchaser whose offer to
purchase Securities from the Issuer has been solicited by the Distributor and
accepted by the Issuer, but the Distributor shall have no liability to the
Issuer in the event any such purchase is not consummated for any reason; and (b)
if the Issuer shall default on its obligations to deliver Securities to a
purchaser whose offer it has accepted, the Issuer (i) shall hold the Distributor
harmless against any loss, claim or damage arising from or as a result of such
default by the Issuer, and (ii) in particular, shall pay to the Distributor any
commission to which it would be entitled in connection with such sale.
9. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The respective
indemnities, agreements, representations, warranties and other statements of the
Issuer or its officers and of the Distributor set forth in or made pursuant to
this Agreement will remain in full force and effect, regardless of any
investigation, or statement as to the results thereof, made by or on behalf of
the Distributor, the Issuer or any of their respective representatives, officers
or directors or any controlling person and will survive delivery of and payment
for the Securities. If this Agreement is terminated pursuant to Section 10 or
for any other reason or if for any reason the sale of Securities described in a
confirmation or Terms Agreement referred to in Section 3 by the Issuer to the
Distributor is not consummated, the Issuer shall remain responsible for the
expenses to be paid or reimbursed by it pursuant to Section 4(j) and the
obligations of the Issuer under Sections 4(f) and, 4(i) and the respective
obligations of the Issuer and the Distributor pursuant to Section 7 shall remain
in effect. In addition, if any such termination of this Agreement shall occur
either (i) at a time when the Distributor shall own any of the Securities with
the intention of reselling them or (ii) after the Issuer has accepted an offer
to purchase Securities and prior to the related settlement, the obligations of
the Issuer under the second sentence of Section 4(c),
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under Sections 4(a), 4(b), 4(d), 4(e), 4(g), 4(h) and 4(k) and, in the case of a
termination occurring as described in (ii) above, under Sections 3(c), 6(a),
6(e) and 6(f) and under the last sentence of Section 8, shall also remain in
effect.
10. TERMINATION. This Agreement may be terminated for any reason at
any time by the Issuer or by the Distributor upon the giving of one day's
written notice of such termination to the other party hereto; PROVIDED, HOWEVER,
that this Agreement may not be terminated by the giving of such notice following
receipt by the Issuer of a confirmation or Terms Agreement referred to in
Section 3 relating to the purchase of Securities by the Distributor and prior to
delivery of the Securities described in such confirmation or Terms Agreement,
unless the sale and purchase of Securities contemplated thereby is rejected by
the Issuer in accordance with Section 3. Any settlement with respect to
Securities placed by the Distributor on an agency basis occurring after
termination of this Agreement shall be made in accordance with the Procedures
and the Distributor agrees, if requested by the Issuer, to take the steps
therein provided to be taken by the Distributor in connection with such
settlement.
11. SALES OF SECURITIES DENOMINATED IN A CURRENCY OTHER THAN U.S.
DOLLARS OR OF INDEXED SECURITIES. If at any time the Issuer and the
Distributor shall determine to issue and sell Securities denominated in a
currency other than U.S. dollars, which other currency may include a currency
unit, or with respect to which an index is used to determine the amounts of
payments of principal and any premium and interest, the Issuer and the
Distributor may execute and deliver a supplement to this Agreement for the
purpose of making any appropriate additions to and modifications of the terms
of this Agreement (and the Procedures) applicable to such Securities and the
offer and sale thereof. The Issuer will not issue Securities denominated in
Yen otherwise than in compliance with applicable Japanese laws, regulations
and policies. In particular, the Issuer or its designated agent shall submit
such reports or information as may be required from time to time by
applicable law, regulations and guidelines promulgated by Japanese
governmental and regulatory authorities in connection with the issue and
offering of the Securities.
12. NOTICES. Except as otherwise provided herein, all notices and
other communications hereunder shall be in writing and shall be deemed to have
been duly given if mailed or transmitted by any standard form of
telecommunication. Notices to Credit Suisse First Boston Corporation shall be
directed to it at Eleven Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000,
Attention: Short and Medium Term Finance Department (Facsimile No. (212)
743-5825); and notices to the Issuer shall be directed to it at Eleven Xxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Attention: Corporate Treasury Department
(Facsimile No.: (000) 000-0000); or in the case of either party hereto, to such
other address or person as such party shall specify to the other party by a
notice given in accordance with the provisions of this Section 12. Any such
notice shall take effect at the time of receipt.
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13. SUCCESSORS. This Agreement will inure to the benefit of and be
binding upon the parties hereto, their respective successors, the officers and
directors and controlling persons referred to in Section 7 and, to the extent
provided in Section 6(f), any person who has agreed to purchase Securities from
the Issuer, and no other person will have any right or obligation hereunder.
14. COUNTERPARTS. This Agreement and any Terms Agreement may be
executed in any number of counterparts, each of which shall be deemed to be
an original, but all such counterparts shall together constitute one and the
same Agreement.
15. APPLICABLE LAW. THIS AGREEMENT AND ANY TERMS AGREEMENT SHALL BE
GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
The Issuer hereby submits to the non-exclusive jurisdiction of the
Federal and state courts in the Borough of Manhattan in The City of New York in
any suit or proceeding arising out of or relating to this Agreement or any Terms
Agreement or the transactions contemplated hereby or thereby.
16. AMENDMENTS. This Agreement may be amended or supplemented if,
but only if, such amendment or supplement is in writing and is signed by the
Issuer and the Distributor.
If the foregoing correctly sets forth our agreement, please indicate
your acceptance hereof in the space provided for that purpose below.
Very truly yours,
CREDIT SUISSE FIRST BOSTON (USA), INC.
By:
-----------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED, as of the
date first above written:
CREDIT SUISSE FIRST BOSTON CORPORATION
By:
-------------------------
Name:
Title:
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Exhibit A
Terms Agreement
[To be filed prior to or in connection with the first offering of the
Medium-Term Notes as an Exhibit to a Current Report on Form 8-K and
incorporated herein by reference]
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Exhibit B
Commissions Schedule
[To be filed prior to or in connection with the first offering of the
Medium-Term Notes as an Exhibit to a Current Report on Form 8-K and
incorporated herein by reference]
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Exhibit C
Administrative Procedures
[To be filed prior to or in connection with the first offering of the
Medium-Term Notes as an Exhibit to a Current Report on Form 8-K and
incorporated herein by reference]
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