INTERNATIONAL BUSINESS MACHINES CORPORATION Debt Securities $3,000,000,000 5.70% Notes due 2017 UNDERWRITING AGREEMENT
EXHIBIT
1
Debt
Securities
$3,000,000,000
5.70% Notes due 2017
Dated
as of September 11,
2007
To
the
Representatives named in Schedule I hereto
of
the Underwriters named in Schedule II hereto
Dear
Sirs:
International
Business Machines Corporation, a New York corporation (the “Company”), proposes
to sell to the underwriters named in Schedule II hereto (the
“Underwriters”), for whom you are acting as representatives (the
“Representatives”), the principal amount of its Securities identified in
Schedule I hereto (the “Securities”), to be issued under an indenture dated
as of October 1, 1993 (the “Indenture”), between the Company and The Bank
of New York, as trustee (the “Trustee”), as supplemented by the First
Supplemental Indenture dated as of December 15, 1995. If the firm or firms
listed in Schedule II hereto include only the firm or firms listed in
Schedule I hereto, then the terms “Underwriters” and “Representatives”, as
used herein shall each be deemed to refer to such firm or firms.
1. Representations
and Warranties. The Company represents and warrants to, and
agrees with each Underwriter that:
(a) The
Company meets the requirements for use of Form S-3 under the Securities Act
of 1933 (the “Act”) and has filed with the Securities and Exchange Commission
(the “Commission”) an automatic shelf registration statement as defined in Rule
405 (the file number of which is set forth in Schedule I hereto), including
a related basic prospectus, on such Form for the registration under the Act
of
the offering and sale of the Securities. Such Registration Statement, including
any amendments thereto filed prior to the Execution Time, became effective
upon
filing. The Company may have filed with the Commission as part of an amendment
to the Registration Statement or pursuant to Rule 424(b) one or more preliminary
prospectus supplements relating to the Securities, each of which has previously
been furnished to you. The Company will file with the Commission a final
prospectus supplement relating to the Securities in accordance with
Rule 424(b). As filed, such final prospectus supplement shall include all
information required by the Act and the rules thereunder, and, except to the
extent the Representatives shall agree in writing to a modification, shall
be in
all substantive respects in the form furnished to you prior to the Execution
Time or, to the extent not completed at the Execution Time, shall contain only
such specific additional information and other changes (beyond that contained
in
the Basic Prospectus and any Preliminary Final Prospectus) as the Company has
advised you, prior to the Execution Time, will be included or made therein.
If
the Registration Statement contains the undertaking specified by
Regulation S-K Item 512(a), the Registration Statement, at the Execution
Time, meets the requirements set forth in Rule 415(a)(1)(x).
The
terms
which follow, when used in this Agreement, shall have the meanings indicated.
The term the “Effective Date” shall mean each date that the Registration
Statement and any post-effective amendment or amendments thereto became or
become effective. “Execution Time” shall mean the date and time that this
Agreement is executed and delivered by the parties hereto. “Basic Prospectus”
shall mean the basic prospectus relating to the Registration Statement to be
used in connection with offering the Securities. “Final Prospectus”
shall mean the prospectus supplement relating to the Securities and containing
the final terms of the Securities that is first filed pursuant to
Rule 424(b) after the Execution Time, together with the Basic Prospectus.
“Registration Statement” shall mean the registration statement referred to in
the preceding paragraph, including incorporated documents, exhibits and
financial statements and any prospectus supplement relating to the Securities
that is filed with the Commission pursuant to Rule 424(b) and deemed part
of such registration statement pursuant to Rule 430B, in the form in which
it or they has or have or shall become effective and, in the event any
post-effective amendment thereto becomes effective prior to the Closing Date
(as
hereinafter defined), shall also mean such registration statement or statements
as so amended. “Rule 433”, “Rule 415”, “Rule 424”,
“Rule 430B” and “Regulation S-K” refer to such rules under the Act.
“Disclosure Package” shall mean (i) the Basic Prospectus, as amended and
supplemented (including any preliminary prospectus supplement issued before
the
Execution Time relating to the Securities) to the Execution Time, (ii) the
Issuer Free Writing Prospectuses, if any, identified in Schedule III
hereto, and (iii) any other Free Writing Prospectus that the parties hereto
shall hereafter expressly agree in writing to treat as part of the Disclosure
Package. “Free Writing Prospectus” shall mean a free writing prospectus, as
defined in Rule 405. “Issuer Free Writing Prospectus” shall mean
an issuer free writing prospectus, as defined in
Rule 433. “Preliminary Final Prospectus” shall mean any
preliminary prospectus supplement to the Basic Prospectus which describes the
Securities and the offering thereof and is used prior to filing of the Final
Prospectus, together with the Basic Prospectus. Any reference herein to the
Registration Statement, a Preliminary Final Prospectus or the Final Prospectus
shall be deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 which were filed under the
Securities Exchange Act of 1934 (the “Exchange Act”) on or before the effective
date of the Registration Statement or the date of such Preliminary Final
Prospectus or the Final Prospectus, as the case may be; and any reference herein
to the terms “amend”, “amendment” or “supplement” with respect to the
Registration Statement, any Preliminary Final Prospectus or the Final Prospectus
shall be deemed to refer to and include the filing of any document under the
Exchange Act after the effective date of the Registration Statement, or the
date
of any Preliminary Final Prospectus or the Final Prospectus, as the case may
be,
deemed to be incorporated therein by reference.
(b) On
the Effective Date and at the Execution Time, the Registration Statement did,
and when the Final Prospectus is first filed (if required) in accordance with
Rule 424(b) and on the Closing Date, the Final Prospectus (and any
supplements thereto) will, comply in all material respects with the applicable
requirements of the Act and the Exchange Act and the respective rules
thereunder; on the Effective Date and on the Closing Date the Indenture did
or
will comply in all material respects with the requirements of the Trust
Indenture Act of 1939 (the “Trust Indenture Act”) and the rules thereunder; on
the Effective Date and at the Execution Time, the Registration Statement did
not
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make the statements
therein not misleading; and, on the date of any filing pursuant to
Rule 424(b) and on the Closing Date, the Final Prospectus (together with
any supplement thereto) will not include any untrue statement of a material
fact
or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that the Company makes no
representations or warranties as to (i) that part of the Registration
Statement which shall constitute the Statement of Eligibility and Qualification
(Form T-1) under the Trust Indenture Act of the Trustee or (ii) the
information contained in or omitted from the Registration Statement or the
Final
Prospectus (or any supplement thereto) in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of any
Underwriter through the Representatives specifically for use in connection
with
the preparation of the Registration Statement or the Final Prospectus (or any
supplement thereto).
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(c) At
the Execution Time the Disclosure Package, when taken together as a whole,
does
not contain any untrue statement of a material fact or omit to state any
material fact necessary in order to make the statements therein, in the light
of
the circumstances under which they were made, not misleading. The
preceding sentence does not apply to statements in or omissions from the
Disclosure Package based upon and in conformity with written information
furnished to the Company by any Underwriter through the Representatives
specifically for use therein, it being understood and agreed that the only
such
information furnished by or on behalf of any Underwriter consists of the
information described as such in Section 7 hereof.
(d) At
the earliest time after the filing of the Registration Statement that the
Company or another offering participant made a bona fide offer (within the
meaning of Rule 164(h)(2)) of the Securities, the Company was not and is
not an Ineligible Issuer (as defined in Rule 405), without taking account
of any determination by the Commission pursuant to Rule 405 that it is not
necessary that the Company be considered an Ineligible Issuer.
(e) Each
Issuer Free Writing Prospectus and the final term sheet prepared and filed
pursuant to Section 4(A)(g) hereto do not include any information that
conflicts with the information contained in the Registration Statement,
including any document incorporated therein and any prospectus supplement deemed
to be a part thereof that has not been superseded or modified. The foregoing
sentence does not apply to statements in or omissions from the Disclosure
Package based upon and in conformity with written information furnished to
the
Company by any Underwriter through the Representative specifically for use
therein, it being understood and agreed that the only such information furnished
by or on behalf of any Underwriter consists of the information furnished by
or
on behalf of any Underwriter consists of the information described as such
in
Section 7 hereof.
(f) (i) At
the time of filing the Registration Statement, (ii) at the time of the most
recent amendment thereto for the purposes of complying with Section 10(a)(3)
of
the Act (whether such amendment was by post-effective amendment, incorporated
report filed pursuant to Sections 13 or 15(d) of the Exchange Act or form of
prospectus), and (iii) at the time the Company or any person acting on its
behalf (within the meaning, for this clause only of Rule 163(c)) made any offer
relating to the Securities in reliance on the exemption in Rule 163, the Company
was or is (as the case may be) a “well-known seasoned issuer” as defined in Rule
405. The Company agrees to pay the fees required by the Commission
relating to the Securities within the time required by Rule 456(b)(1) without
regard to the proviso therein and otherwise in accordance with Rules 456(b)
and
457(r).
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2. Purchase
and Sale. Subject to the terms and conditions and in reliance
upon the representations and warranties herein set forth, the Company agrees
to
sell to each Underwriter, and each Underwriter agrees, severally and not
jointly, to purchase from the Company, at the purchase price set forth in
Schedule I hereto, the respective principal amounts of the Securities set
forth opposite each respective Underwriter’s name in Schedule II hereto,
except that, if Schedule I hereto provides for the sale of Securities
pursuant to delayed delivery arrangements, the respective principal amounts
of
Securities to be purchased by the Underwriters shall be as set forth in
Schedule II hereto, less the respective amounts of Contract Securities
determined as provided below. Securities to be purchased by the Underwriters
are
herein sometimes called the “Underwriters’ Securities” and Securities to be
purchased pursuant to Delayed Delivery Contracts as hereinafter provided are
herein called “Contract Securities”.
If
so
provided in Schedule I hereto, the Underwriters are authorized to solicit
offers to purchase Securities from the Company pursuant to delayed delivery
contracts (“Delayed Delivery Contracts”), substantially in the form of
Schedule IV hereto but with such changes therein as the Company may
authorize or approve. The Underwriters will endeavor to make such arrangements
and, as compensation therefor, the Company will pay to the Representatives,
for
the account of underwriters, on the Closing Date, the percentage set forth
in
Schedule I hereto of the principal amount of the Securities for which
Delayed Delivery Contracts are made. Delayed Delivery Contracts are to be with
institutional investors, including commercial and savings banks, insurance
companies, pension funds, investment companies and educational and charitable
institutions. The Company will make Delayed Delivery Contracts in all cases
where sales of Contract Securities arranged by the Underwriters have been
approved by the Company but, except as the Company may otherwise agree, each
such Delayed Delivery Contract must be for not less than the minimum principal
amount set forth in Schedule I hereto and the aggregate principal amount of
Contract Securities may not exceed the maximum aggregate principal amount set
forth in Schedule I hereto. The Underwriters will not have any
responsibility in respect of the validity or performance of Delayed Delivery
Contracts. The principal amount of Securities to be purchased by each
Underwriter as set forth in Schedule II hereto shall be reduced by an
amount which shall bear the same proportion to the total principal amount of
Contract Securities as the principal amount of Securities set forth opposite
the
name of such Underwriter bears to the aggregate principal amount set forth
in
Schedule II hereto, except to the extent that you determine that such
reduction shall be otherwise than in such proportion and so advise the Company
in writing; provided, however, that the total principal amount
of Securities to be purchased by all Underwriters shall be the aggregate
principal amount set forth in Schedule II hereto, less the aggregate
principal amount of Contract Securities.
3. Delivery
and Payment. Delivery of and payment for the Underwriters’
Securities shall be made at the office, on the date and at the time
specified in
Schedule I hereto, which date and time may be postponed by agreement
between the Representatives and the Company or as provided in Section 8
hereof (such date and time of delivery and payment for the Securities being
called the “Closing Date”). Delivery of the Underwriters’ Securities shall be
made to the Representatives for the respective accounts of the several
Underwriters against payment by the several Underwriters through the
Representatives of the purchase price thereof to or upon the order of the
Company by certified or official bank check or checks payable, or wire
transfers, in immediately available funds. The Securities shall be
delivered in definitive global form through the facilities of The Depository
Trust Company.
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4. Agreements.
(A) The
Company agrees with the several Underwriters that:
(a) The
Company will file the Final Prospectus, properly completed, pursuant to the
applicable paragraph of Rule 424(b) within the time period prescribed and
will provide evidence satisfactory to the Representatives of such timely filing.
The Company will promptly advise the Representatives (i) when any amendment
to the Registration Statement relating to the Securities shall have become
effective, (ii) of any request by the Commission for any amendment of the
Registration Statement or amendment of or supplement to the Final Prospectus
or
for any additional information, (iii) of the issuance by the Commission of
any stop order suspending the effectiveness of the Registration Statement or
of
any notice that would prevent its use or the institution or threatening of
any
proceeding for that purpose and (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Securities for sale in any jurisdiction or the initiation or threatening of
any
proceeding for such purpose. The Company will use its best efforts to prevent
the issuance of any such stop order and, if issued, to obtain as soon as
possible the withdrawal thereof. The Company will not file any amendment of
the
Registration Statement or supplement to the Final Prospectus unless the Company
has furnished you a copy for your review prior to filing and will not file
any
such proposed amendment or supplement to which you reasonably
object.
(b) If,
at any time when a prospectus relating to the Securities is required to be
delivered under the Act (including in circumstances where such requirement
may
be satisfied pursuant to Rule 172), any event occurs as a result of which
the Final Prospectus as then amended or supplemented would include any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein in the light of the circumstances under which they
were made not misleading, or if it shall be necessary to amend or supplement
the
Final Prospectus to comply with the Act or the Exchange Act or the respective
rules thereunder, the Company will give the Representatives immediate notice
of
the occurrence of such event and promptly will prepare and file with the
Commission, subject to the first sentence of paragraph (a) of this
Section 4, an amendment or supplement which will correct such statement or
omission or an amendment which will effect such compliance.
(c) The
Company will make generally available to its security holders and to the
Representatives as soon as practicable, but not later than 45 days after
the end of the 12-month period beginning at the end of the current fiscal
quarter of the Company, an earning statement (which need not be audited) of
the
Company and its subsidiaries, covering a period of at least 12 months
beginning after the end of the current fiscal quarter of the Company, which
will
satisfy the provisions of Section 11(a) of the Act and Rule 158
thereunder.
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(d) The
Company will furnish to the Representatives and counsel for the Underwriters,
without charge, copies of the Registration Statement (including exhibits
thereto) and each amendment thereto which shall become effective on or prior
to
the Closing Date and, so long as delivery of a prospectus by an Underwriter
or
dealer may be required by the Act (including in circumstances where such
requirement may be satisfied pursuant to Rule 172), as many copies of any
Preliminary Final Prospectus and the Final Prospectus and each Issuer Free
Writing Prospectus and any amendments thereof and supplements thereto as the
Representatives may reasonably request.
(e) The
Company will arrange for the qualification of the Securities for sale under
the
laws of such jurisdictions as the Representatives may designate, will maintain
such qualifications in effect so long as required for the distribution of the
Securities and will arrange for the determination of the legality of the
Securities for purchase by institutional investors.
(f) Until
the earlier of the day on which the distribution of the Securities is completed
or the business day following the Closing Date, the Company will not, without
the consent of the Representatives, offer or sell, or announce the offering
of,
any debt securities covered by the Registration Statement or any other
registration statement filed under the Act.
(g) To
prepare a final term sheet, containing solely a description of the Securities,
in a form approved by you and to file such term sheet pursuant to
Rule 433(d) within the time required by such Rule.
(h) If
there occurs an event or development as a result of which the Disclosure Package
would include an untrue statement of a material fact or would omit to state
a
material fact necessary in order to make the statements therein, in the light
of
the circumstances then prevailing, not misleading, the Company will notify
promptly the Representatives so that any use of the Disclosure Package may
cease
until it is amended or supplemented.
(i) The
Company agrees that, unless it obtains the prior written consent of the
Representatives, it has not made and will not make any offer relating to the
Securities that would constitute an Issuer Free Writing Prospectus or that
would
otherwise constitute a “free writing prospectus” (as defined in Rule 405)
required to be filed by the Company with the Commission or retained by the
Company under Rule 433, other than the final term sheet prepared and filed
pursuant to Section 4(g) hereto; provided that the prior written consent of
the
parties hereto shall be deemed to have been given in respect of the Free Writing
Prospectuses included in Schedule III hereto. Any such free writing
prospectus consented to by the Representatives is hereinafter referred to as
a
“Permitted Free Writing Prospectus.” The Company agrees that (x) it
has treated and will treat, as the case may be, each Permitted Free Writing
Prospectus as an Issuer Free Writing Prospectus and (y) it has complied and
will
comply, as the case may be, with the requirements of Rules 164 and 433
applicable to any Permitted Free Writing Prospectus, including in respect of
timely filing with the Commission, legending and record keeping.
(B) The
several Underwriters agree with the Company that:
(a) The
Representatives will pay the expenses of printing and distributing all documents
relating to the offering.
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(b) The
Representatives will pay the reasonable fees and disbursements of outside
counsel for the Company and the Underwriters relating to the
offering.
(c) The
Representatives will pay any fees of ▇▇▇▇▇’▇ Investors Service, Inc. and
Standard & Poor’s Ratings Group, a division of The ▇▇▇▇▇▇-▇▇▇▇ Companies,
Inc. relating to the rating of the Securities.
(d) The
Representatives will pay the fees and disbursements of PricewaterhouseCoopers
LLP relating to the preparation of the letter required by Section 5(e) of
this Agreement.
(e) The
Representatives will pay the reasonable fees and expenses of The Bank of New
York, as Trustee.
(f) The
Representatives will pay any and all fees associated with listing the Securities
on any United States or foreign securities exchange.
(g) The
Representatives will pay any and all travel expenses incurred by the Company
in
connection with the offering of the Securities.
(h) The
Representatives will pay any and all other miscellaneous expenses and/or taxes
associated with the offering.
(i) Each
Underwriter agrees to furnish the Company with a copy of each proposed Free
Writing Prospectus to be prepared by or on behalf of such Underwriter before
its
first use and not to use any Free Writing Prospectus, to which the Company
reasonably objects, provided, however, that without consent of the Company
each
Underwriter may use the final term sheet prepared and filed pursuant to
Section 4(A)(g) hereto and one or more preliminary term sheets relating to
the Securities containing customary information.
5. Conditions
to the Obligations of the Underwriters. The obligations of the
Underwriters to purchase the Underwriters’ Securities shall be subject to the
accuracy of the representations and warranties on the part of the Company
contained herein as of the Execution Time, as of the date of the effectiveness
of any amendment to the Registration Statement filed prior to the Closing Date
(including the filing of any document incorporated by reference therein) and
as
of the Closing Date, to the accuracy of the statements of the Company made
in
any certificates pursuant to the provisions hereof, to the performance by the
Company of its obligations hereunder and to the following additional
conditions:
(a) The
Final Prospectus, and any supplement thereto, have been filed in the manner
and
within the time period required by Rule 424(b); the final term sheet
contemplated by Section 4(A)(g) hereto, and any other material required to
be filed by the Company pursuant to Rule 433(d) under the Act, shall have
been filed with the Commission within the applicable time periods prescribed
for
such filings by Rule 433; and no stop order suspending the effectiveness of
the Registration Statement, as amended from time to time, or any notice that
would prevent its use shall have been issued and no proceedings for that purpose
shall have been instituted or threatened.
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(b) The
Company shall have furnished to the Representatives:
(i) the
opinion of the General Counsel, an Assistant General Counsel, an Associate
General Counsel or other senior counsel of the Company, dated the Closing Date,
to the effect that:
(A) the
Company has been duly incorporated and is validly existing as a corporation
in
good standing under the laws of the State of New York, with full corporate
power
and authority to own its properties and conduct its business as described in
the
Disclosure Package and the Final Prospectus, and is duly qualified to do
business as a foreign corporation and is in good standing under the laws of
each
jurisdiction within the United States which requires such qualifications wherein
it owns or leases material properties or conducts material
business;
(B) the
Securities conform in all material respects to the description thereof contained
in the Disclosure Package and the Final Prospectus;
(C) the
Indenture has been duly authorized, executed and delivered, has been duly
qualified under the Trust Indenture Act, and constitutes a legal, valid and
binding obligation enforceable against the Company in accordance with its terms
(subject to applicable bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and other similar laws affecting creditors’ rights
generally from time to time in effect, and subject, as to enforceability, to
general principles of equity, regardless of whether such enforceability is
considered in a proceeding in equity or at law); and the Securities have been
duly authorized and, when executed and authenticated in accordance with the
provisions of the Indenture and delivered to and paid for by the Underwriters
pursuant to this Agreement, in the case of the Underwriters’ Securities, or by
the purchasers thereof pursuant to Delayed Delivery Contracts, in the case
of
any Contract Securities, will constitute legal, valid and binding obligations
of
the Company entitled to the benefits of the Indenture (subject to applicable
bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium, and
other similar laws affecting creditors’ rights generally from time to time in
effect);
(D) to
the best knowledge of such counsel, there is no pending or threatened action,
suit or proceeding before any court or governmental agency, authority or body
or
any arbitrator involving the Company or any of its subsidiaries, of a character
required to be disclosed in the Registration Statement which is not adequately
disclosed in the Disclosure Package and the Final Prospectus, and there is
no
franchise, contract or other document of a character required to be described
in
the Registration Statement or Final Prospectus, or to be filed as an exhibit,
which is not described or filed as required;
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(E) the
Registration Statement and any amendments thereto have become effective under
the Act; any required filing of the Basic Prospectus any Preliminary Final
Prospectus and the Final Prospectus, and any supplements thereto, pursuant
to
Rule 424(b) has been made in the manner and within the time period required
by Rule 424(b); to the best knowledge of such counsel, no stop order
suspending the effectiveness of the Registration Statement, as amended, or
any
notice that would prevent its use, has been issued, no proceedings for that
purpose have been instituted or are pending or contemplated under the
Act;
(F) this
Agreement and any Delayed Delivery Contracts have been duly authorized, executed
and delivered by the Company;
(G) no
authorization, approval or other action by, and no notice to, consent of, order
of, or filing with, any United States Federal or New York governmental authority
or regulatory body is required for the consummation of the transactions
contemplated herein or in any Delayed Delivery Contracts, except such as have
been obtained under the Act and such as may be required under the blue sky
laws
of any jurisdiction in connection with the purchase and distribution of the
Securities and such other approvals (specified in such opinion) as have been
obtained;
(H) such
counsel has no reason to believe that (1) the Registration Statement and
the Final Prospectus (except the financial statements and the notes thereto
and
other information of an accounting or financial nature included therein, and
the
Statement of Eligibility (Form T-1) included as an exhibit to the
Registration Statement, as to which such counsel need express no view) were
not
appropriately responsive in all material respects to requirements of the Act
and
the applicable rules and regulations of the Commission thereunder or
(2) the Registration Statement or any amendment thereof at the time it
became effective or at the Execution Time contained any untrue statement of
a
material fact or omitted to state any material fact required to be stated
therein or necessary to make the statements therein not misleading or that
the
Final Prospectus, as amended or supplemented, either as of its date or the
Closing Date contains or contained any untrue statement of a material fact
or
omits or omitted to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading (in each case except for the financial statements and the notes
thereto and other information of an accounting or financial nature included
therein, as to which such counsel need express no view);
(I) none
of the issue and sale of the Securities, the consummation of any other of the
transactions herein contemplated or the fulfillment of the terms hereof or
of
any Delayed Delivery Contracts will conflict with, result in a breach of, or
constitute a default under, the charter or by-laws of the Company or the terms
of any indenture or other agreement or instrument known to such counsel and
to
which the Company or any of its subsidiaries is a party or bound, or any decree
or regulation known to such counsel to be applicable to the Company or any
of
its subsidiaries of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over the Company or any
of
its subsidiaries; and
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(J) such
counsel has no reason to believe that the Disclosure Package, at the Execution
Time, contained any untrue statement of a material fact or omitted to state
any
material fact necessary in order to make the statements therein, in the light
of
circumstances under which they were made, not misleading.
The
statements described in one or more of paragraphs (B), (C), (E), (F),
(G), (H) and (J) of this subsection 5(b)(i) may be omitted from the opinion
of such counsel; provided, however, that in such event the Company shall also
have furnished to the Representatives the corresponding opinion or letter of
▇▇▇▇▇▇▇, Swaine & ▇▇▇▇▇ LLP, counsel for the Company, described in
subsection 5(b)(ii) or 5(b)(iii) immediately following.
(ii) in
the event that the statements described in one or more of paragraphs (B),
(C), (E), (F) or (G) of foregoing subsection 5(b)(i) is omitted from the
opinion delivered pursuant to such subsection, the opinion of ▇▇▇▇▇▇▇,
Swaine & ▇▇▇▇▇ LLP, counsel for the Company, dated the Closing Date, to
the effect of the statements so omitted.
In
rendering such opinions, such counsel may rely (A) as to matters involving
the application of laws of any jurisdiction other than the State of New York,
the general corporation law of the State of Delaware or the United States,
to
the extent they deem proper and specified in such opinion, upon the opinion
of
other counsel of good standing whom they believe to be reliable and who are
satisfactory to counsel for the Underwriters; and (B) as to matters of
fact, to the extent they deem proper, on certificates of responsible officers
of
the Company and public officials.
(iii) in
the event that the statements in paragraph (H) or (J) of
subsection 5(b)(i) are omitted from the opinion provided pursuant to such
subsection, a letter of Cravath, Swaine & ▇▇▇▇▇ LLP dated the Closing
Date to the effect that, having participated in conferences with certain
officers of, and with the accountants for, the Company and having made certain
inquiries and investigations in connection with the preparation of the
Registration Statement, the Disclosure Package and the Final Prospectus, such
counsel has no reason to believe that (i) the Registration Statement and
the Final Prospectus (except the financial statements and the notes thereto
and
other information of an accounting or financial nature included therein, and
the
Statement of Eligibility (Form T-1) included as an exhibit to the
Registration Statement, as to which such counsel need express no view) were
not
appropriately responsive in all material respects with requirements of the
Act
and the applicable rules and regulations of the Commission thereunder or
(ii) the Registration Statement at the Effective Date or the Execution Time
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading, the Disclosure Package at the Execution Time contained any
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, or the Final Prospectus on the Closing
Date includes any untrue statement of a material fact 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 each case except
for the financial statements and the notes thereto and other information of
an
accounting or financial nature included therein, as to which such counsel need
express no view).
10
(c) The
Representatives shall have received from ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel
for the Underwriters, such opinion or opinions, dated the Closing Date, with
respect to the issuance and sale of the Securities, the Indenture, any Delayed
Delivery Contracts, the Registration Statement, the Final Prospectus, Disclosure
Package and other related matters as the Representatives may reasonably require,
and the Company shall have furnished to such counsel such documents as they
request for the purpose of enabling them to pass upon such matters.
(d) The
Company shall have furnished to the Representatives a certificate of the
Company, signed by the principal financial or accounting officer (or Vice
President and Treasurer) of the Company, dated the Closing Date, to the effect
that the signer of such certificate has carefully examined the Registration
Statement, the Disclosure Package, the Final Prospectus and any supplements
or
amendments thereto and this Agreement and that:
(i) the
representations and warranties of the Company in this Agreement are true and
correct in all material respects on and as of the Closing Date with the same
effect as if made on the Closing Date and the Company has complied with all
the
agreements and satisfied all the conditions on its part to be performed or
satisfied at or prior to the Closing Date;
(ii) no
stop order suspending the effectiveness of the Registration Statement, as
amended, or any notice that would prevent its use has been issued and no
proceedings for that purpose have been instituted or, to the Company’s
knowledge, threatened; and
(iii) since
the date of the most recent financial statements included in the Disclosure
Package or the Final Prospectus, there has been no material adverse change
in
the condition (financial or other), earnings, business or properties of the
Company and its subsidiaries, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in the
Disclosure Package and the Final Prospectus.
11
(e) At
the Closing Date, PricewaterhouseCoopers LLP shall have furnished to the
Representatives a letter or letters (which may refer to a letter previously
delivered to one or more of the Representatives), dated as of the Closing Date,
in form and substance satisfactory to the Representatives, confirming that
they
are independent accountants within the meaning of the Act and the Exchange
Act
and the respective applicable published rules and regulations thereunder, that
the response, if any, to Item 10 of the Registration Statement is correct
insofar as it relates to them and stating in effect that:
(i) in
their opinion the audited financial statements and schedules thereto included
or
incorporated in the Registration Statement, the Disclosure Package and the
Final
Prospectus and reported on by them comply as to form in all material respects
with the applicable accounting requirements of the Exchange Act and the
published rules and regulations thereunder with respect to financial statements
and financial statement schedules included or incorporated in annual reports
on
Form 10-K under the Exchange Act;
(ii) on
the basis of a reading of the unaudited financial statements included or
incorporated in the Registration Statement, the Disclosure Package and the
Final
Prospectus and of the latest unaudited financial statements made available
by
the Company and its subsidiaries; carrying out certain specified procedures
(but
not an examination in accordance with generally accepted auditing standards)
which would not necessarily reveal matters of significance with respect to
the
comments set forth in such letter; a reading of the minutes of the meetings
of
the stockholders, directors and executive committees of the Company and the
Subsidiaries since the date of the latest audited balance sheet, through a
specified date not more than five business days prior to the date of the letter;
and inquiries of certain officials of the Company who have responsibility for
financial and accounting matters of the Company and its subsidiaries as to
transactions and events subsequent to the date of the most recent financial
statements incorporated in the Registration Statement and the Final Prospectus,
nothing came to their attention which caused them to believe that:
(1) any
unaudited financial statements included or incorporated in the Registration
Statement, the Disclosure Package and the Final Prospectus do not comply as
to
form in all material respects with applicable accounting requirements and with
the published rules and regulations of the Commission with respect to financial
statements included or incorporated in quarterly reports on Form 10-Q under
the Exchange Act; and said unaudited financial statements are not stated on
a
basis substantially consistent with that of the audited financial statements
included or incorporated in the Registration Statement and the Final Prospectus;
or
12
(2) with
respect to the period subsequent to the date of the most recent financial
statements incorporated in the Registration Statement, the Disclosure Package
and the Final Prospectus, there were, at a specified date not more than five
business days prior to the date of the letter, any increases in long-term debt
of the Company and its subsidiaries or decreases in the capital stock of the
Company or decreases in the stockholders’ equity of the Company and its
subsidiaries as compared with the amounts shown on the most recent consolidated
balance sheet included or incorporated in the Registration Statement, the
Disclosure Package and the Final Prospectus, except in all instances for
increases or decreases set forth in such letter, in which case the letter shall
be accompanied by an explanation by the Company as to the significance thereof
unless said explanation is not deemed necessary by the Representatives;
and
(iii) they
have performed certain other procedures as a result of which they determined
that the information described in a schedule to be delivered on behalf of the
Underwriters of an accounting, financial or statistical nature (which is limited
to accounting, financial or statistical information derived from the general
ledger of the Company) set forth in the Registration Statement, as amended,
the
Disclosure Package, the Final Prospectus, as amended or supplemented, and in
Exhibit 12 to the Registration Statement (including selected accounting,
financial or statistical information included or incorporated in the Company’s
Annual Report on Form 10-K incorporated in the Final Prospectus or any of
the Company’s Quarterly Reports on Form l0-Q incorporated therein), agrees
with the general ledger of the Company and its subsidiaries, excluding any
questions of legal interpretation.
References
to the Final Prospectus in this paragraph (e) include any supplements
thereto at the date of the letter.
(f) Subsequent
to the respective dates of which information is given in the Registration
Statement and the Prospectus, there shall not have been (i) any change or
decrease specified in the letter or letters referred to in paragraph (e) of
this Section 5 or (ii) any change, or any development involving a
prospective change, in or affecting the business or properties of the Company
and its subsidiaries the effect of which, in any case referred to in
clause (i) or (ii) above, is, in the judgment of the Representatives,
so material and adverse as to make it impractical or inadvisable to proceed
with
the public offering or the delivery of the Securities as contemplated by the
Registration Statement, the Disclosure Package and the Final
Prospectus.
(g) Prior
to the Closing Date, the Company shall have furnished to the Representatives
such further information, certificates and documents as the Representatives
may
reasonably request.
(h) The
Company shall have accepted Delayed Delivery Contracts in any case where sales
of Contract Securities arranged by the Underwriters have been approved by the
Company.
13
(i) Subsequent
to the Execution Time, there shall not have been any decrease in the ratings
of
any of the Securities by ▇▇▇▇▇’▇ Investor’s Service, Inc. (“▇▇▇▇▇’▇”) or
Standard & Poor’s Ratings Group, a division of The ▇▇▇▇▇▇-▇▇▇▇
Companies, Inc. (“S&P”) and neither ▇▇▇▇▇’▇ nor S&P shall have publicly
announced that it has placed any of the Securities on a credit watch with
negative implications.
If
any of
the conditions specified in this Section 5 shall not have been fulfilled in
all material respects when and as provided in this Agreement, or if any of
the
opinions and certificates mentioned above or elsewhere in this Agreement shall
not be in all material respects reasonably satisfactory in form and substance
to
the Representatives and their counsel, this Agreement and all obligations of
the
Underwriters hereunder may be canceled at, or at any time prior to, the Closing
Date by the Representatives. Notice of such cancelation shall be given to the
Company in writing or by telephone or telegraph confirmed in
writing.
6. Reimbursement
of Underwriters’ Expenses. If the sale of the Securities provided for
herein is not consummated because any condition to the obligations of the
Underwriters set forth in Section 5 hereof is not satisfied or because of
any refusal, inability or failure on the part of the Company to perform any
agreement herein or comply with any provision hereof other than by reason of
a
default by any of the Underwriters, the Company will reimburse the Underwriters
severally upon demand for all out-of-pocket expenses (including reasonable
fees
and disbursements of counsel) that shall have been incurred by them in
connection with the proposed purchase and sale of the Securities.
7. Indemnification
and
Contribution. (a)
The Company agrees to indemnify and hold harmless each Underwriter
and each
person who controls any Underwriter within the meaning of either the Act or
the
Exchange Act against any and all losses, claims, damages or liabilities, joint
or several, to which they or any of them may become subject under the Act,
the
Exchange Act or other Federal or state statutory law or regulation, at common
law or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in the Registration
Statement for the registration of the Securities as originally filed or in
any
amendment thereof, or in the Basic Prospectus, any Preliminary Final Prospectus,
the Final Prospectus or any Issuer Free Writing Prospectus, or in any amendment
thereof or supplement thereto, or arise out of or are based upon the omission
or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and agrees to
reimburse each such indemnified party for any legal or other expenses reasonably
incurred, as incurred, by them in connection with investigating or defending
any
such loss, claim, damage, liability or action; provided,
however, that the Company will not be liable in any such case
to the
extent that any such loss, claim, damage or liability arises out of or is based
upon any such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with written
information furnished to the Company by or on behalf of any Underwriter through
the Representatives specifically for use in connection with the preparation
thereof. This indemnity agreement will be in addition to any liability which
the
Company may otherwise have.
14
(b) Each
Underwriter severally agrees to indemnify and hold harmless the Company, each
of
its directors, each of its officers who signs the Registration Statement, and
each person who controls the Company within the meaning of either the Act or
the
Exchange Act, to the same extent as the foregoing indemnity from the Company
to
each Underwriter, but only with reference to written information relating to
such Underwriter furnished to the Company by or on behalf of such Underwriter
through the Representatives specifically for use in the preparation of the
documents referred to in the foregoing indemnity. This indemnity agreement
will
be in addition to any liability which any Underwriter may otherwise have. The
Company acknowledges that the statements set forth in the last paragraph of
the cover page of the Final Prospectus and under the heading “Underwriting” or
“Plan of Distribution” and, if Schedule I hereto provides for sales of
Securities pursuant to delayed delivery arrangements, in the last sentence
under
the heading “Delayed Delivery Arrangements” in any Preliminary Final Prospectus
and the Final Prospectus, constitute the only information furnished in writing
by or on behalf of the several Underwriters for inclusion in the Basic
Prospectus, any Preliminary Final Prospectus, the Final Prospectus or any Issuer
Free Writing Prospectus, and you, as the Representatives, confirm that such
statements are correct.
(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 this Section 7,
notify the indemnifying party in writing 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 this
Section 7. 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 appoint counsel satisfactory to such
indemnified party to represent the indemnified party in such action;
provided, however, if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, the indemnified
party or parties shall have the right to select separate counsel to defend
such
action on behalf of such indemnified party or parties. Upon receipt of notice
from the indemnifying party to such indemnified party of its election so to
appoint counsel to defend such action and approval by the indemnified party
of
counsel, 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 unless
(i) the indemnified party shall have employed separate counsel in
accordance with the proviso to the next preceding sentence (it being understood,
however, that the indemnifying party shall not be liable for the expenses of
more than one separate counsel (in addition to any local counsel), approved
by
the Representatives in the case of paragraph (a) of this Section 7,
representing the indemnified parties under such paragraph (a) who are
parties to such action), (ii) the indemnifying party shall not have
employed counsel reasonably satisfactory to the indemnified party to represent
the indemnified party within a reasonable time after notice of commencement
of
the action or (iii) the indemnifying party has authorized the employment of
counsel for the indemnified party at the expense of the indemnifying party;
and
except that, if clause (i) or (iii) is applicable, such liability
shall be only in respect of the counsel referred to in such clause (i) or
(iii).
15
(d) In
order to provide for just and equitable contribution in circumstances in which
the indemnification provided for in paragraph (a) of this Section 7 is
due in accordance with its terms but is for any reason held by a court to be
unavailable from the Company on grounds of policy or otherwise, the Company
and
the Underwriters shall contribute to the aggregate losses, claims, damages
and
liabilities (including legal or other expenses reasonably incurred in connection
with investigating or defending same) to which the Company and one or more
of
the Underwriters may be subject in such proportion so that the Underwriters
are
responsible for that portion represented by the percentage that the underwriting
discount bears to the sum of such discount and the purchase price of the
Securities set forth on Schedule I hereto and the Company is responsible
for the balance; provided,however, that (y) in no case
shall any Underwriter (except as may be provided in any agreement among
underwriters relating to the offering of the Securities) be responsible for
any
amount in excess of the underwriting discount applicable to the Securities
purchased by such Underwriter hereunder and (z) no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section 7, each
person who controls an Underwriter within the meaning of either the Act or
the
Exchange Act shall have the same rights to contribution as such Underwriter,
and
each person who controls the Company within the meaning of either the Act or
the
Exchange Act, each officer of the Company who shall have signed the Registration
Statement and each director of the Company shall have the same rights to
contribution as the Company, subject in each case to clauses (y)
and (z) of this paragraph (d). Any party entitled to contribution
will, promptly after receipt of notice of commencement of any action, suit
or
proceeding against such party in respect of which a claim for contribution
may
be made against another party or parties under this paragraph (d), notify
such party or parties from whom contribution may be sought, but the omission
to
so notify such party or parties shall not relieve the party or parties from
whom
contribution may be sought from any other obligation it or they may have
hereunder or otherwise than under this paragraph (d).
8. Default
by an Underwriter. If any one or more Underwriters shall fail to
purchase and pay for any of the Securities agreed to be purchased by such
Underwriter or Underwriters hereunder and such failure to purchase shall
constitute a default in the performance of its or their obligations under this
Agreement, the remaining Underwriters shall be obligated severally to take
up
and pay for (in the respective proportions which the amount of Securities set
forth opposite their names in Schedule II hereto bears to the aggregate
amount of Securities set forth opposite the names of all the remaining
Underwriters) the Securities which the defaulting Underwriter or Underwriters
agreed but failed to purchase; provided, however, that in the
event that the aggregate amount of Securities which the defaulting Underwriter
or Underwriters agreed but failed to purchase shall exceed 10% of the aggregate
amount of Securities set forth in Schedule II hereto, the remaining
Underwriters shall have the right to purchase all, but shall not be under any
obligation to purchase any, of the Securities, and if such nondefaulting
Underwriters do not purchase all the Securities, this Agreement will terminate
without liability to any nondefaulting Underwriter or the Company. In the event
of a default by any Underwriter as set forth in this Section 8, the Closing
Date shall be postponed for such period, not exceeding seven days, as the
Representatives shall determine in order that the required changes in the
Registration Statement, the Disclosure Package and the Final Prospectus or
in
any other documents or arrangements may be effected. Nothing contained in this
Agreement shall relieve any defaulting Underwriter of its liability, if any,
to
the Company and any nondefaulting Underwriter for damages occasioned by its
default hereunder.
9. Termination.
This Agreement shall be subject to termination in the absolute discretion
of the
Representatives, by notice given to the Company prior to delivery of and
payment
for the Securities, if prior to such time (i) trading in securities
generally on the New York Stock Exchange shall have been suspended or limited
or
minimum prices shall have been established on such Exchange, (ii) a banking
moratorium shall have been declared either by Federal or New York State
authorities or (iii) there shall have occurred any outbreak or material
escalation of hostilities or other 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
the Representatives, impracticable to market the
Securities.
16
10. Representations
and Indemnities to Survive. The respective agreements, representations,
warranties, indemnities and other statements of the Company or its officers
and
of the Underwriters set forth in or made pursuant to this Agreement will remain
in full force and effect, regardless of any investigation made by or on behalf
of any Underwriter or the Company or any of the officers, directors or
controlling persons referred to in Section 7 hereof, and will survive
delivery of and payment for the Securities. The provisions of Sections 6
and 7 hereof shall survive the termination or cancelation of this
Agreement.
11. Notices.
All communications hereunder will be in writing and effective only on receipt,
and, if sent to the Representatives, will be mailed, delivered or telegraphed
and confirmed to them, at the address specified in Schedule I hereto; or,
if sent to the Company, will be mailed, delivered or telegraphed and confirmed
to it, at Armonk, New York 10504; attention of the Treasurer.
12. Successors.
This Agreement will inure to the benefit of and be binding upon the parties
hereto and their respective successors and the officers and directors and
controlling persons referred to in Section 7 hereof, and no other person
will have any right or obligation hereunder.
13. Applicable
Law. This Agreement will be governed by and construed in accordance
with the laws of the State of New York.
14. Arms-Length
Transaction. The Company acknowledges and agrees that (i)
the purchase and sale of the Securities pursuant to this Agreement is an
arm's-length commercial transaction between the Company, on the one hand, and
the several Underwriters, on the other, (ii) in connection therewith and with
the process leading to such transaction each Underwriter is acting solely as
a
principal and not the agent or fiduciary of the Company, (iii) no Underwriter
has assumed an advisory of fiduciary responsibility in favor of the Company
with
respect to the offering contemplated hereby or the process leading thereto
(irrespective of whether such Underwriter has advised or is currently advising
the Company on other matters) or any other obligation to the Company except
the
obligations expressly set forth in this Agreement and (iv) the Company has
consulted its own legal and financial advisors to the extent it deemed
appropriate. The Company agrees that it will not claim that the
Underwriters, or any of them, has rendered advisory services of any nature
or
respect, or owes a fiduciary or similar duty to the Company, in connection
with
such transaction or the process leading thereto.
17
If
the
foregoing is in accordance with your understanding of our agreement, please
sign
and return to us the enclosed duplicate hereof, whereupon this letter and your
acceptance shall represent a binding agreement among the Company and the several
Underwriters.
Very
truly
yours,
|
By:
|
/s/
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
|
|
Name: ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇
|
|
|
Title:
Treasurer
|
|
The
foregoing Agreement is hereby
confirmed
and accepted on the
date
specified in Schedule I hereto.
|
BARCLAYS
CAPITAL INC.
BNP
PARIBAS SECURITIES CORP.
CITIGROUP
GLOBAL MARKETS INC.
▇▇▇▇▇▇▇,
▇▇▇▇▇ & CO.
▇.▇.
▇▇▇▇▇▇ SECURITIES INC.
UBS
SECURITIES LLC
|
|
|
By:
|
BARCLAYS
CAPITAL INC.
|
|
By:
|
/s/
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
|
|
Name:
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
|
|
|
Title: Managing
Director
|
|
For
themselves and the other several
Underwriters,
if any, named in
Scheduled
II to the foregoing Agreement.
18
SCHEDULE
I
Underwriting
Agreement dated September 11, 2007
Registration
No. 333-145104
|
Representatives:
|
Barclays
Capital Inc.
|
|
BNP
Paribas Securities Corp
|
|
|
Citigroup
Global Markets Inc.
|
|
|
▇▇▇▇▇▇▇,
▇▇▇▇▇ & Co.
|
|
|
▇.▇.
▇▇▇▇▇▇ Securities Inc.
|
|
|
UBS
Securities LLC
|
Title,
Purchase Price and Description of Securities:
Title:
5.70%
Notes due 2017
Principal
amount: $3,000,000,000
|
Purchase
price:
|
99.254%
of the principal amount of Notes plus accrued interest from September
14,
2007
|
|
Offering
price:
|
99.654%
of the principal amount of Notes plus accrued interest from September
14,
2007
|
|
Interest:
|
Payable
on March 14 and September 14 of each year, commencing on March 14,
2008
|
Sinking
fund provisions: None.
Redemption
provisions: The Notes are redeemable in whole or in part, at the
option of the Company, as described in the Final Prospectus.
Closing
Date, Time and Location: September 14, 2007, 10:00 A.M., at the offices of
Cravath, Swaine & ▇▇▇▇▇ LLP, Worldwide Plaza, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇.
Delayed
Delivery Arrangements: None.
Items
specified pursuant to Section 5(e)(iii) to be covered by the letter from
PricewaterhouseCoopers LLP delivered pursuant to
Section 5(e): None.
|
Other
Terms:
|
|
|
1.
|
Section 4(B)(a)
- (h) are deleted.
|
|
|
2.
|
Each
of the Underwriters has agreed that it will not offer, sell, or deliver
any of the Securities, directly or indirectly, or distribute the
prospectus supplement or prospectus or any other offering material
relating to the Securities, in or from any jurisdiction except under
circumstances that will, to the best of the Underwriters’ knowledge and
belief, result in compliance with the applicable laws and regulations
and
which will not impose any obligations on the
Company.
|
I-1
The
Underwriters also agree to abide by the following offering
restrictions:
European
Economic Area
Each
of
the Underwriters has agreed that it will not offer, sell, or deliver any of
the
Securities, directly or indirectly, or distribute the prospectus supplement
or
prospectus or any other offering material relating to the Securities, in or
from
any jurisdiction except under circumstances that will, to the best of the
underwriters’ knowledge and belief, result in compliance with the applicable
laws and regulations and which will not impose any obligations on the Company
except as set forth in this underwriting agreement.
In
relation to each Member State of the European Economic Area which has
implemented the Prospectus Directive (each, a Relevant Member State), each
Underwriter has represented and agreed that with effect from and including
the
date on which the Prospectus Directive is implemented in that Relevant Member
State (the Relevant Implementation Date) it has not made and will not make
an
offer of notes to the public in that Relevant Member State prior to the
publication of a prospectus in relation to the notes which has been approved
by
the competent authority in that Relevant Member State or, where appropriate,
approved in another Relevant Member State and notified to the competent
authority in that Relevant Member State, all in accordance with the Prospectus
Directive, except that it may, with effect from and including the Relevant
Implementation Date, make an offer of notes to the public in that Relevant
Member State at any time:
(a) to
legal entities which are authorized or regulated to operate in the financial
markets or, if not so authorized or regulated, whose corporate purpose is solely
to invest in securities;
(b) to
any legal entity which has two or more of
1. an
average of at least 250 employees during the last financial year;
2. a
total balance sheet of more than €43,000,000 and
3. an
annual net turnover of more than €50,000,000, as shown in its last annual or
consolidated accounts; or
(c) in
any other circumstances which do not require the publication by the issuer
of a
prospectus pursuant to Article 3 of the Prospectus Directive.
For
the
purposes of this provision, the expression an “offer of Notes to the public” in
relation to any Securities in any Relevant Member State means the communication
in any form and by any means of sufficient information on the terms of the
offer
and the Securities to be offered so as to enable an investor to decide to
purchase or subscribe the Securities, as the same may be varied in that Member
State by any measure implementing the Prospectus Directive in that Member State
and the expression Prospectus Directive means Directive 2003/71/EC and includes
any relevant implementing measure in each Relevant Member State.
I-2
United
Kingdom
Each
Underwriter has represented and agreed that it and each of its
affiliates:
(a) has
only communicated or caused to be communicated and will only communicate or
cause to be communicated an invitation or inducement to engage in investment
activity (within the meaning of section 21 of FSMA) to persons who have
professional experience in matters relating to investments falling within
Article 19(5) of the Financial Services and Markets Act 2000 (Financial
Promotion) Order 2005 or in circumstances in which section 21 of FSMA does
not
apply to the company; and
(b) has
complied with, and will comply with, all applicable provisions of FSMA with
respect to anything done by it in relation to the Securities in, from or
otherwise involving the United Kingdom.
The
Republic of Italy
Each
underwriter has acknowledged and agreed that no prospectus or prospectus
supplement has been nor will be published in Italy in connection with the
offering of the Securities and that such offering has not been and will not
be
subject to any formal review or clearance procedures by the Italian Securities
Exchange Commission (Commissione Nazionale per le Societ`▇ ▇ ▇▇ ▇▇▇▇▇,
the “CONSOB”) pursuant to Italian securities legislation and accordingly has
acknowledged and agreed that the Securities may not and will not be offered,
sold or delivered, directly or indirectly, nor may or will copies of this
prospectus supplement or prospectus or any other documents relating to the
Securities be distributed, in Italy or to a resident of Italy, except (i) to
professional investors (operatori qualificati) within the meaning of
Article 31(2) of the CONSOB Regulation No. 11522 of July 1, 1998, as amended,
(the “Regulation No. 11522”), or (ii) in other circumstances which are 137
exempted from the rules governing offers of securities to the public pursuant
to
Article 100 of the Legislative Decree No. 58 of February 24, 1998, as amended
(the “Unified Financial Act”) and Article 33(1) of CONSOB Regulation No. 11971
of May 14, 1999, as amended.
Each
underwriter has further acknowledged and agreed that any offer, sale or delivery
of the Securities or distribution of copies of this prospectus supplement or
prospectus or any other document relating to the Securities in Italy may and
will be effected in compliance with any Italian securities, tax, exchange
control and other applicable laws and regulations, and, in particular, will
be:
(i) made by an investment firm, bank or financial intermediary authorized to
carry out such activities in Italy in accordance with the Unified Financial
Act,
Legislative Decree No. 385 of September 1, 1993, as amended (the “Italian
Banking Act”), Regulation No. 11522, and any other applicable laws and
regulations; (ii) in compliance with Article 129 of the Italian Banking Act
and
the implementing guidelines of the Bank of Italy; and (iii) in compliance with
any other applicable notification requirement or limitation imposed upon the
offer of shares by CONSOB or the Bank of Italy.
I-3
Any
investor purchasing the Securities in the context of the offering is solely
responsible for ensuring that any offer or resale of the Securities it purchased
in context of the offering occurs in compliance with applicable laws and
regulations.
This
prospectus supplement or prospectus and the information contained herein are
intended only for the use of its recipient and, unless in circumstances which
are exempted from the rules governing offers of securities to the public
pursuant to Article 100 of the Unified Financial Act and Article 33(1) of CONSOB
Regulation No. 11971 of May 14, 1999, as amended, are not to be distributed
to
any third party resident or located in Italy for any reason. No person resident
or located in Italy other than the original recipients of this document may
rely
on it or its content.
Italy
has
not wholly implemented the Directive No. 2003/71/EC (the “Prospectus
Directive”); the above shall continue to apply to the extent not inconsistent
with any further implementing measures of the Prospectus Directive in
Italy.
Insofar
as the requirements above are based on laws which are superseded at any time
pursuant to the implementation of the Prospectus Directive in Italy, such
requirements shall be replaced by the applicable requirements under the relevant
implementing measures of the Prospectus Directive in Italy.
Japan
The
Securities have not been and will not be registered under the Securities and
Exchange Law of Japan (the “SEL”) and each Underwriter and each of its
affiliates has represented and agreed that it has not offered or sold, and
it
will not offer or sell, directly or indirectly, any of the Securities in or
to
residents of Japan or to any persons for reoffering or resale, directly or
indirectly, in Japan or to any resident of Japan, except pursuant to an
exemption from the registration requirements of the SEL available thereunder
and
otherwise in compliance with the SEL and the other relevant laws, regulations
and guidelines of Japan.
Hong
Kong
Each
of
the Underwriters and each of its affiliates has represented and agreed that
it
has not offered or sold, and it will not offer or sell, the Securities by means
of any document to persons in Hong Kong other than persons whose ordinary
business it is to buy or sell shares or debentures, whether as principal or
agent, or otherwise in circumstances which do not constitute an offer to the
public within the meaning of the Hong Kong Companies Ordinance (Chapter 32
of the Laws of Hong Kong).
I-4
4. The
last sentence of Section 7(b) shall be deleted and replaced by the following
text:
“The
Company acknowledges that the statements set forth in the last paragraph of
the
cover page of the Preliminary Final Prospectus and the Final Prospectus, the
sentence “The underwriters have informed IBM that they intend to make a market
in the Notes but are under no obligation to do so and such market making may
be
terminated at any time without notice.” and the statements contained
in the fourth and seventh through ninth paragraphs under the caption
“Underwriting” in the Preliminary Final Prospectus and the Final
Prospectus constitute the only information furnished in writing by or on behalf
of the several Underwriters for inclusion in the Basic Prospectus, any
Preliminary Final Prospectus, the Disclosure Package, any Issuer Free Writing
Prospectus or the Final Prospectus, and you, as the Representatives, confirm
that such statements are correct.
5.. The
following shall be an additional condition added to Section 5:
The
Company shall have furnished to the Representatives the opinion of ▇▇▇▇▇▇▇,
Swaine & ▇▇▇▇▇ LLP, counsel to the Company, dated the Closing Date to the
effect that the statements under the caption “United States Taxation” in the
Disclosure Package and the Final Prospectus constitute a fair presentation
of
the material U.S. federal income tax consequences to holders of
Securities.
I-5
SCHEDULE
II
$3,000,000,000
5.70% Notes due 2017
|
Underwriters
|
Principal
Amount
of
Notes to be
Purchased
|
||
|
Barclays
Capital Inc..
|
$360,000,000
|
||
|
BNP
Paribas Securities Corp.
|
360,000,000
|
||
|
Citigroup
Global Markets Inc.
|
360,000,000
|
||
|
▇▇▇▇▇▇▇,
▇▇▇▇▇ & Co.
|
360,000,000
|
||
|
▇.▇.
▇▇▇▇▇▇ Securities Inc.
|
360,000,000
|
||
|
UBS
Securities LLC
|
360,000,000
|
||
|
Deutsche
Bank Securities Inc.
|
180,000,000
|
||
|
▇▇▇▇▇▇
Brothers Inc.
|
180,000,000
|
||
|
▇▇▇▇▇▇
▇▇▇▇▇▇▇ & Co. Incorporated
|
180,000,000
|
||
|
Banc
of America Securities LLC
|
60,000,000
|
||
|
Mitsubishi
UFJ Securities International plc
|
60,000,000
|
||
|
HSBC
Securities (USA) Inc.
|
60,000,000
|
||
|
CastleOak
Securities, L.P.
|
30,000,000
|
||
|
Loop
Capital Markets, LLC
|
30,000,000
|
||
|
▇.
▇. ▇▇▇▇ & Company
|
30,000,000
|
||
|
▇▇▇▇▇▇
▇▇▇▇▇▇▇ & Co., Inc.
|
30,000,000
|
||
|
Total
|
$3000,000,000
|
||
II-1
SCHEDULE
III
Schedule
of Free Writing Prospectuses included in the Disclosure
Package
Pricing
Term Sheet dated September 11, 2007, as filed pursuant to
Rule 433
III-1
SCHEDULE
IV
Delayed
Delivery Contract
[Insert
names and addresses
of
lead Representatives]
Dear
Sirs: ,
200
The
undersigned hereby agrees to purchase from International Business Machines
Corporation (the “Company”), and the Company agrees to sell to the undersigned,
on ,
200 , (the “Delivery
Date”), $ principal
amount of the
Company’s (the
“Securities”) offered by the Company’s Final Prospectus
dated ,
200 , receipt of a copy of which is hereby acknowledged, at a
purchase price of % of the principal
amount thereof, plus accrued , if any,
thereon
from ,
200 , to the date of payment and delivery, and on the
further terms and conditions set forth in this contract.
Payment
for the Securities to be purchased by the undersigned shall be made on or before
11:00 A.M. on the Delivery Date to or upon the order of the Company in New
York
Clearing House (next day) funds, at your office or at such other place as shall
be agreed between the Company and the undersigned upon delivery to the
undersigned of the Securities in definitive, fully registered form and in such
authorized denominations and registered in such names as the undersigned may
request by written or telegraphic communication addressed to the Company not
less than five full business days prior to the Delivery Date. If no request
is
received, the Securities will be registered in the name of the undersigned
and
issued in a denomination equal to the aggregate principal amount of Securities
to be purchased by the undersigned on the Delivery Date.
The
obligation of the undersigned to take delivery of and make payment for
Securities on the Delivery Date, and the obligation of the Company to sell
and
deliver Securities on the Delivery Date, shall be subject to the conditions
(and
neither party shall incur any liability by reason of the failure thereof) that
(1) the purchase of Securities to be made by the undersigned, which purchase
the
undersigned represents is not prohibited on the date hereof, shall not on the
Delivery Date be prohibited under the laws of the jurisdiction to which the
undersigned is subject, and (2) the Company, on or before the Delivery
Date, shall have sold to certain underwriters (the “Underwriters”) such
principal amount of the Securities as is to be sold to them pursuant to the
Underwriting Agreement referred to in the Final Prospectus mentioned above.
Promptly after completion of such sale to the Underwriters, the Company will
mail or deliver to the undersigned at its address set forth below notice to
such
effect, accompanied by a copy of the opinion of counsel for the Company
delivered to the Underwriters in connection therewith. The obligation of the
undersigned to take delivery of and make payment for the Securities, and the
obligation of the Company to cause the Securities to be sold and delivered,
shall not be affected by the failure of any purchaser to take delivery of and
make payment for the Securities pursuant to other contracts similar to this
contract.
IV-1
This
contract will inure to the benefit of and be binding upon the parties hereto
and
their respective successors, but will not be assignable by either party hereto
without the written consent of the other.
It
is
understood that acceptance of this contract and other similar contracts is
in
the Company’s sole discretion and, without limiting the foregoing, need not be
on a first come, first served basis. If this contract is acceptable to the
Company, it is required that the Company sign the form of acceptance below
and
mail or deliver one of the counterparts hereof to the undersigned at its address
set forth below. This will become a binding contract between the Company and
the
undersigned, as of the date first above written, when such counterpart is so
mailed or delivered.
This
agreement shall be governed by and construed in accordance with the laws of
the
State of New York.
Very
truly
yours,
(Name
of
Purchaser)
By________________________
(Signature
and
Title)
(Address)
Accepted:
INTERNATIONAL
BUSINESS MACHINES
CORPORATION
By _____________________________
IV-2