PEPSICO, INC. TERMS AGREEMENT
Exhibit 1.1
Execution Copy
PEPSICO, INC.
7.90% Senior Notes due 2018
October 21, 2008
| To: | PepsiCo, Inc. ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ |
Ladies and Gentlemen:
We understand that PepsiCo, Inc., a North Carolina corporation (the “Company”), proposes to
issue and sell $2,000,000,000 of its 7.90% Senior Notes due 2018 (such securities also being
hereinafter referred to as the “Underwritten Securities”) subject to the terms and conditions
stated herein and in the Underwriting Agreement Standard Provisions dated as of October 21, 2008
attached hereto as Annex A (the “Standard Provisions”). Each of the applicable provisions in the
Standard Provisions is incorporated herein by reference in its entirety, and shall be deemed to be
a part of this Agreement to the same extent as if such provisions had been set forth in full
herein. We, the underwriters named below (the “Underwriters”), offer to purchase, severally and not
jointly, the number or amount of Underwritten Securities opposite our names set forth below at a
purchase price equal to 99.308% of the principal amount thereof.
| Principal | ||||
| Underwriter | Amount | |||
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated |
$ | 710,000,000 | ||
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated |
20,000,000 | |||
UBS Securities LLC |
710,000,000 | |||
The ▇▇▇▇▇▇▇▇ Capital Group, L.P. |
440,000,000 | |||
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co., Inc. |
60,000,000 | |||
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ & Co., Inc. |
60,000,000 | |||
Total |
2,000,000,000 | |||
The Underwritten Securities and the offering thereof shall have the following additional
terms:
Terms of the Underwritten Securities and the Offering
Issuer:
|
PepsiCo, Inc. | |||
Title of Securities:
|
7.90% Senior Notes Due 2018 | |||
Ratings:
|
Aa2 (Stable) by ▇▇▇▇▇’▇ Investors Service, Inc and A+ (Stable) by Standard & Poor’s Rating Services | |||
Trade Date:
|
October 21, 2008 | |||
Time of Sale
|
4:45 p.m. on the Trade Date |
Settlement Date (T+3):
|
October 24, 2008 | |||
Closing Time
|
9:30 a.m. on the Settlement Date | |||
Closing Location
|
New York, New York | |||
Maturity Date:
|
November 1, 2018 | |||
Time of Sale Prospectus:
|
Base Prospectus dated October 15, 2008, preliminary prospectus supplement dated October 21, 2008 and free writing prospectus dated October 21, 2008. | |||
Aggregate Principal Amount Offered:
|
$2,000,000,000 | |||
Price to Public (Issue Price):
|
99.758% | |||
Proceeds to PepsiCo (Before Expenses):
|
$1,986,160,000 | |||
Benchmark Treasury:
|
4% Treasury Notes due August 15, 2018 | |||
Benchmark Treasury Yield:
|
3.735% | |||
Spread to Treasury:
|
420 bps | |||
Re-offer Yield:
|
7.935% | |||
Coupon:
|
7.90% | |||
Interest Payment Dates:
|
Semi-annually on each May 1 and November 1, commencing on May 1, 2009 | |||
Optional Redemption:
|
Make-whole call at any time, at the greater of 100% of the principal amount of the notes being redeemed or discounted present value at Treasury rate plus 50 basis points | |||
Minimum Denomination:
|
$2,000 and integral multiples of $1,000 | |||
Daycount Fraction:
|
30 / 360 | |||
CUSIP/ISIN:
|
▇▇▇▇▇▇▇▇▇/US713448BJ63 | |||
Joint Bookrunners and Representatives
of the Several Underwriters:
|
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, UBS Securities LLC and The ▇▇▇▇▇▇▇▇ Capital Group, L.P. | |||
Address and facsimile number for
notices to the Representatives :
|
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated | |||
| 4 World Financial Center | ||||
| ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ | ||||
| ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ | ||||
| ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated |
| ▇▇▇▇ ▇▇▇▇▇▇▇▇ | ||||
| ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ | ||||
| UBS Securities LLC | ||||
| ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ | ||||
| ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ | ||||
| The ▇▇▇▇▇▇▇▇ Capital Group, L.P. | ||||
| ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ | ||||
| ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ | ||||
Co-Managers:
|
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co., Inc. and ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ & Co., Inc. | |||
Amount of reimbursement to the
Company from the Underwriters
|
Reasonably documented legal, printing and SEC filing fees, which the Company currently estimates to be approximately $320,000 |
The Representative represents and warrants that it is duly authorized to execute and deliver
this Terms Agreement on behalf of the several Underwriters named above.
IN WITNESS WHEREOF, the parties hereto have executed this Terms Agreement as of the date first
above written.
| PEPSICO, INC. |
||||
| By: | /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | |||
| Name: | ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | |||
| Title: | Chief Financial Officer | |||
| By: | /s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | |||
| Name: | J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | |||
| Title: | Vice President and Assistant Treasurer | |||
CONFIRMED AND ACCEPTED, as of the date first above written:
▇▇▇▇▇▇▇
LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
UBS SECURITIES LLC
THE ▇▇▇▇▇▇▇▇ CAPITAL GROUP, ▇.▇.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
as Representatives of the several Underwriters
INCORPORATED
UBS SECURITIES LLC
THE ▇▇▇▇▇▇▇▇ CAPITAL GROUP, ▇.▇.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
as Representatives of the several Underwriters
By:
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
INCORPORATED
| By: | /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇ | |||||
| Title: Managing Director |
By: UBS SECURITIES LLC
| By: | /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ | |||||
| Title: Managing Director | ||||||
| By: | /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ | |||||
| Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ | ||||||
| Title: Associate Director |
By: THE ▇▇▇▇▇▇▇▇ CAPITAL GROUP, L.P.
| By: | /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ | |||||
| Title: Principal |
By: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
| By: | /s/ Yurij Slyz | |||||
| Title: Vice President |
Schedule I
Time of Sale Prospectus:
| 1. | Preliminary Prospectus issued October 21, 2008 (including the Base Prospectus) | |
| 2. | Any free writing prospectuses filed by the Company under Rule 433(d) of the Securities Act | |
| 3. | Final Term Sheet, attached as Schedule II |
Schedule II
Issuer Free Writing Prospectus
Filed Pursuant to Rule 433
Registration Statement No. 333-154314
October 21, 2008
Filed Pursuant to Rule 433
Registration Statement No. 333-154314
October 21, 2008
PepsiCo, Inc.
$2,000,000,000 7.90% Senior Notes Due November 1, 2018
$2,000,000,000 7.90% Senior Notes Due November 1, 2018
Issuer:
|
PepsiCo, Inc. | |||
Title of Securities:
|
7.90% Senior Notes Due 2018 | |||
Ratings:
|
Aa2 (Stable) by ▇▇▇▇▇’▇ Investors Service, Inc and A+ (Stable) by Standard & Poor’s Rating Services | |||
Trade Date:
|
October 21, 2008 | |||
Settlement Date (T+3):
|
October 24, 2008 | |||
Maturity Date:
|
November 1, 2018 | |||
Aggregate Principal Amount
Offered:
|
$2,000,000,000 | |||
Price to Public (Issue Price):
|
99.758% | |||
Proceeds to PepsiCo (Before
Expenses):
|
$1,986,160,000 | |||
Benchmark Treasury:
|
4% Treasury Notes due August 15, 2018 | |||
Benchmark Treasury Yield:
|
3.735% | |||
Spread to Treasury:
|
420 bps | |||
Re-offer Yield:
|
7.935% | |||
Coupon:
|
7.90% | |||
Interest Payment Dates:
|
Semi-annually on each May 1 and November 1, commencing on May 1, 2009 | |||
Optional Redemption:
|
Make-whole call at any time, at the greater of 100% of the principal amount of the notes being redeemed or discounted present value at Treasury rate plus 50 basis points | |||
Minimum Denomination:
|
$2,000 and integral multiples of $1,000 | |||
Daycount Fraction:
|
30 / 360 | |||
CUSIP/ISIN:
|
▇▇▇▇▇▇▇▇▇/US713448BJ63 | |||
Joint Bookrunners:
|
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ | |||
| Incorporated, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. | ||||
| Incorporated, UBS Securities LLC and The | ||||
| ▇▇▇▇▇▇▇▇ Capital Group, L.P. | ||||
Co-Managers:
|
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co., Inc. and ▇▇▇▇▇▇ ▇. | |||
| ▇▇▇▇▇▇▇ & Co., Inc. |
An explanation of the significance of ratings may be obtained from the ratings agencies.
Generally, ratings agencies base their ratings on such material and information, and such of their
own investigations, studies and assumptions, as they deem appropriate. The security ratings above
are not a recommendation to buy, sell or hold the securities offered hereby. The ratings may be
subject to review, revision, suspension, reduction or withdrawal at any time by Moody’s and
Standard & Poor’s. Each of the security ratings above should be evaluated independently of any
other security rating.
The issuer has filed a registration statement (including a prospectus) with the SEC for the
offering to which this communication relates. Before you invest, you should read the prospectus in
that registration statement and other documents the issuer has filed with the SEC for more complete
information about the issuer and this offering. You may get these documents for free by visiting
▇▇▇▇▇ on the SEC Web site at ▇▇▇.▇▇▇.▇▇▇. Alternatively, the issuer, any underwriter or any dealer
participating in the offering will arrange to send you the prospectus if you request it by calling
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated toll-free at ▇-▇▇▇-▇▇▇-▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ &
Co. Incorporated toll-free at 1-866-718-1649 (institutional investors), UBS Securities LLC
toll-free at ▇ -▇▇▇-▇▇▇-▇▇▇▇ (extension 561-3884) or The ▇▇▇▇▇▇▇▇ Capital Group, L.P. toll-free at
▇-▇▇▇-▇▇▇-▇▇▇▇.
Any disclaimers or other notices that may appear below are not applicable to this communication and
should be disregarded. Such disclaimers or other notices were automatically generated as a result
of this communication being sent via Bloomberg or another email system.
Annex A
PEPSICO, INC.
Underwritten Securities
UNDERWRITING AGREEMENT STANDARD PROVISIONS
October 21, 2008
From time to time, PepsiCo, Inc., a corporation organized under the laws of the State of North
Carolina (the “Company”), may enter into one or more terms agreements (each, a “Terms Agreement”)
in substantially the form of Exhibit A hereto, with such additions and deletions as the parties
thereto may determine, and, subject to the terms and conditions stated herein and therein, to issue
and sell certain securities (the “Securities”) to the underwriter or underwriters named in the
applicable Terms Agreement (the “Underwriters,” which term shall include any underwriter
substituted pursuant to Section 8 hereof). The provisions included herein (the “Standard
Provisions”) shall be attached to and incorporated by reference into each Terms Agreement.
Section 1. Definitions. The Company has filed with the Securities and Exchange Commission (the
“Commission”) an “automatic shelf registration statement” as defined in Rule 405 under the
Securities Act of 1933, as amended (the “Securities Act”) on Form S-3 covering the registration of
certain Securities of the Company to be issued and sold from time to time, in or pursuant to one or
more offerings on terms to be determined at the time of sale, in accordance with Rule 415 under the
Securities Act. Such registration statement (as so amended, if applicable), including the
information, if any, deemed to be a part thereof pursuant to Rule 430B under the Securities Act
(the “Rule 430 Information”), is referred to herein as the “Registration Statement”; and the base
prospectus included in the Registration Statement at the time of filing (the “Base Prospectus”) and
the final prospectus supplement relating to a particular offering of Underwritten Securities (as
defined below) referred to in a Terms Agreement, in the forms first used to confirm sales of such
Underwritten Securities (or in the form first made available to the Underwriters by the Company to
meet requests of purchasers pursuant to Rule 173 under the Securities Act), are collectively
referred to herein as the “Prospectus.” All references herein to the “Registration Statement” and
the “Prospectus” shall be deemed to include all documents incorporated therein by reference which
are filed by the Company pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange
Act”) or the Securities Act, prior to the execution of the applicable Terms Agreement. References
herein to a “preliminary prospectus” relating to an offering of particular Underwritten Securities
pursuant to a Terms Agreement shall be deemed to refer to the Base Prospectus and to the prospectus
supplement (a “preliminary prospectus supplement”) relating to such Underwritten Securities that
omitted Rule 430 Information or other information to be included upon pricing in a form of
prospectus relating to such Underwritten Securities filed by the Company with the Commission
pursuant to Rule 424(b) under the Securities Act and that was used prior to the initial delivery of
the Prospectus relating to such Underwritten Securities to the Underwriters by the Company.
For purposes of these Standard Provisions and the Terms Agreement relating to an offering of
particular Underwritten Securities, “free writing prospectus” has the meaning set forth in Rule 405
under the Securities Act, and “Time of Sale Prospectus” means the Base Prospectus, the final
preliminary prospectus supplement filed prior to the “Time of Sale” set forth in such Terms
Agreement, together with any free writing prospectus or other information stated in such Terms
Agreement to form part of the Time of Sale Prospectus. For purposes of these Standard Provisions,
all references to the “Registration Statement,” “Prospectus,” “preliminary prospectus” or “Time of
Sale Prospectus” or to any amendment or supplement to any of the foregoing shall be deemed to
include any copy filed with the Commission pursuant to its Electronic Data Gathering, Analysis and
Retrieval system (“▇▇▇▇▇”).
All references in these Standard Provisions to financial statements and schedules and other
information which is “contained,” “included” or “stated” (or other references of like import) in
the Registration Statement, preliminary prospectus, Time of Sale Prospectus or Prospectus shall be
deemed to mean and include all such financial statements and schedules and other information which
is incorporated by reference in the Registration Statement, the applicable preliminary prospectus,
the applicable Time of Sale Prospectus or the applicable Prospectus, as the case may be, prior to
the execution of the applicable
Terms Agreement; and all references in these Standard Provisions to amendments or supplements
to the Registration Statement, preliminary prospectus, Time of Sale Prospectus or Prospectus shall
be deemed to include the filing of any document under the Exchange Act which is incorporated by
reference in the Registration Statement, the applicable preliminary prospectus, the applicable Time
of Sale Prospectus or the applicable Prospectus, as the case may be, after the execution of the
applicable Terms Agreement.
Section 2. Purchase and Sale of Securities by the Underwriters. Whenever the Company
determines to make an offering of Securities to be governed by these Standard Provisions, the
Company will enter into a Terms Agreement providing for the sale of such Securities to, and the
purchase and offering thereof by, the Underwriters. The Terms Agreement relating to the offering of
Securities shall specify the number or amount of Securities to be issued (the “Underwritten
Securities”), the name of each Underwriter participating in such offering (subject to substitution
as provided in Section 8 hereof) and the name of any Underwriter acting as manager or co-manager in
connection with such offering, the number or amount of Underwritten Securities which each such
Underwriter severally agrees to purchase, whether such offering is on a fixed or variable price
basis and, if on a fixed price basis, the initial offering price, the price at which the
Underwritten Securities are to be purchased by the Underwriters, the form, time, date and place of
delivery and payment of the Underwritten Securities and any other material terms of the
Underwritten Securities. The Terms Agreement may take the form of an exchange of any standard form
of written telecommunication between the Company and the Underwriter or Underwriters, acting
through the Underwriters’ representative (the “Representative”) identified as such in the
applicable Terms Agreement. Each offering of Underwritten Securities will be governed by these
Standard Provisions, as supplemented by the applicable Terms Agreement.
If so specified in the applicable Terms Agreement, the Company may grant the Underwriters the
option to purchase at their election up to the number of additional Securities (the “Optional
Securities”) set forth in such Terms Agreement at the purchase price per Security set forth
therein, for the sole purpose of covering over-allotments of Securities in excess of the number of
“Firm Securities” set forth in such Terms Agreement. Both Firm Securities and Optional Securities
shall be deemed Underwritten Securities hereunder. Any such election to purchase Optional
Securities may be exercised only once, and only by written notice from the Representative to the
Company, given within a period of 30 calendar days after the date of such Terms Agreement and
setting forth the aggregate number of Optional Securities to be purchased and the time and date on
which such Optional Securities are to be delivered (which shall be a Closing Time (as defined
below) hereunder), as determined by the Representative but in no event earlier than the initial
Closing Date (as defined below) for the Firm Securities or, unless the Representative and the
Company otherwise agree in writing, earlier than two or later than ten Business Days (as defined
below) after the date of such notice. If the Company shall have granted such an option to the
Underwriters, then in the event and to the extent that the Underwriters shall exercise such option
as provided above, the Company will sell to each of the Underwriters, and each of the Underwriters
will, severally and not jointly, purchase from the Company, at the purchase price set forth in such
Terms Agreement, subject to adjustment as provided below, that portion of the number of Optional
Securities as to which such option shall have been exercised (to be adjusted by the Representative
so as to eliminate fractional Securities) determined by multiplying such number of Optional
Securities by a fraction the numerator of which is the number of Firm Securities which such
Underwriter is required to purchase as set forth opposite the name of such Underwriter in such
Terms Agreement and the denominator of which is the aggregate number of Firm Securities that all of
the Underwriters are required to purchase thereunder.
As used herein, “Business Day” means any day other than a Saturday, Sunday or other day on
which commercial banks are permitted or required to be closed in New York City.
Section 3. Underwriters’ Obligation to Purchase Underwritten Securities. The several
commitments of the Underwriters to purchase the Underwritten Securities pursuant to the applicable
Terms Agreement shall be deemed to have been made on the basis of the representations, warranties
and agreements herein contained and shall be subject to the terms and conditions herein set forth.
Section 4. Terms Agreement. No agreement for the purchase of the Underwritten Securities by
the Underwriters will be deemed to exist until the Company and the Representative, on behalf of the
Underwriters, have executed a Terms Agreement. Each Terms Agreement will incorporate all applicable
terms and provisions of these Standard Provisions as fully as though such terms and provisions were
expressly stated therein.
Section 5. Delivery of Certain Documents, Certificates, and Opinions. At each Closing Time,
the Underwriters shall have received the following documents:
(a) the opinion and disclosure letter of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, or other special New York
counsel for the Company reasonably acceptable to the Representative; the opinion of internal
counsel for the Company; and the opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, PLLC, or other special
North Carolina counsel for the Company reasonably acceptable to the Representative, each dated as
of the Closing Date, substantially in the respective forms of Exhibits ▇-▇, ▇-▇, ▇-▇ ▇▇▇ ▇-▇
▇▇▇▇▇▇,
(▇) the opinion of counsel to the Underwriters, selected by the Representative and reasonably
acceptable to the Company, dated as of the Closing Date, in form and substance reasonably
satisfactory to the Underwriters,
(c) a certificate of the Assistant Secretary of the Company, dated as of the Closing Date,
substantially in the form of Exhibit C hereto, and
(d) a certificate of the Chief Financial Officer or Treasurer of the Company, dated as of the
Closing Date, substantially in the form of Exhibit D hereto.
Section 6. Certain Conditions Precedent to the Underwriters’ Obligations. The Underwriters’
obligation to purchase any Underwritten Securities will in all cases be subject to the accuracy of
the representations and warranties of the Company set forth in Section 7 hereof, to the receipt of
the opinions and certificates to be delivered to the Underwriters pursuant to the terms of Section
5 hereof, to the accuracy of the statements of the Company’s officers made in each certificate to
be furnished as provided herein, to the performance and observance by the Company of all covenants
and agreements contained herein on its part to be performed and observed, in each case at the time
the Company executes a Terms Agreement, at the Time of Sale and as of the applicable Closing Date,
and (in each case) to the following additional conditions precedent, when and as specified:
(a) As of the Closing Time for any Underwritten Securities, and with respect to the period
from the date of the applicable Terms Agreement to and including the applicable Closing Time:
(i) there shall not have occurred (A) any material adverse change (or development
involving a prospective material adverse change) in the business, properties, earnings, or
financial condition of the Company and its subsidiaries on a consolidated basis (a “Material
Adverse Effect”) or (B) any suspension or material limitation of trading in the Company’s
common stock, par value one and two-thirds cents (1-2/3 cents) per share, of the Company
(“Common Stock”), by the Commission or the New York Stock Exchange, Inc. (the “NYSE”), the
effect of any of which shall have made it impracticable, in the reasonable judgment of the
Underwriters, to market such Underwritten Securities, such judgment to be based on relevant
market conditions;
(ii) there shall not have occurred (A) any suspension or material limitation of trading
in securities generally on the NYSE, (B) a declaration of a general moratorium on commercial
banking activities in New York by either Federal or New York State authorities, or (C) any
outbreak or material escalation of hostilities or other national or international calamity or
crisis, the effect of any of which shall have made it impracticable, in the judgment of the
Underwriters, to market such Underwritten Securities, such judgment to be based on relevant
market conditions; and
(iii) there shall not have been issued any stop order suspending the effectiveness of the
Registration Statement nor shall any proceedings for that purpose or pursuant to Section 8A of
the Securities Act against the Company or related to the offering of the Underwritten
Securities have been instituted or threatened.
(b) The Underwriters will receive, upon execution and delivery of any applicable Terms
Agreement, a letter from KPMG LLP, or such other independent registered public accounting firm as
may be selected by the Company, containing statements and information of the type ordinarily
included in accountants’ “comfort letters” to underwriters with respect to the financial statements
and certain financial information of the Company contained in the Registration Statement and the
Prospectus.
(c) At each Closing Time, the Underwriters shall have received from KPMG LLP, or such other
independent registered public accounting firm as may be selected by the
Company, a letter, dated as of the Closing Date, to the effect that they reaffirm the
statements made in the letter furnished pursuant to
subsection (b) of this Section, except that the “cut off” date referred to therein shall be a
date not more than five Business Days prior to the Closing Date.
(d) On each Closing Date, the Underwriters shall have received from the Company such
appropriate further information, certificates, and documents as the Company and the Underwriters
shall have agreed, as reflected in the applicable Terms Agreement.
(e) Subsequent to the execution and delivery of the applicable Terms Agreement and prior to
the Closing Time, there shall not have been any material downgrading, nor any notice given of any
intended or potential material downgrading or of a possible material change that does not indicate
the direction of the possible material change, in the rating accorded any of the Company’s
securities, including the Underwritten Securities, by either ▇▇▇▇▇’▇ Investors Service, Inc. or
Standard & Poor’s Ratings Services, a division of The McGraw Hill Companies, Inc.
Section 7. Representations and Warranties of the Company. The Company represents and warrants
to each Underwriter named in the applicable Terms Agreement, as of the date thereof, and as of each
Closing Time, the following statements are and shall be true:
(a) (i) The Registration Statement constitutes an “automatic shelf registration statement” (as
defined in Rule 405 under the Securities Act) filed within three years of the date of the
applicable Terms Agreement, (ii) the Company is a “well known seasoned issuer” (as defined in Rule
405 under the Securities Act), (iii) the Company has not received from the Commission any notice
pursuant to Rule 401(g)(2) under the Securities Act objecting to the use of the automatic shelf
registration statement form, (iv) the Registration Statement became effective upon filing with the
Commission and no stop order suspending the effectiveness of the Registration Statement is in
effect nor, to the Company’s knowledge, are any proceedings for such purpose pending before or
threatened by the Commission, (v) as of the effective date of the Registration Statement (the
“Effective Date”), the Company met the applicable requirements for use of Form S-3 under the
Securities Act with respect to the registration under the Securities Act of the Securities, and
(vi) as of the Effective Date, the Registration Statement met the requirements set forth in Rule
415(a)(1)(x) under the Securities Act and complied in all material respects with said Rule.
(b) (i) Each document, if any, filed or to be filed pursuant to the Exchange Act or the
Securities Act and incorporated or to be incorporated by reference in the Prospectus or Time of
Sale Prospectus complies or will comply, in all material respects, with the applicable provisions
of the Exchange Act or the Securities Act, as applicable, and the rules and regulations of the
Commission thereunder, (ii) the Registration Statement does not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading, (iii) the Registration Statement and the Prospectus comply,
in all material respects, with the Securities Act and the rules and regulations of the Commission
thereunder, (iv) the Prospectus does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, and (v) the Time of Sale Prospectus does not as of its date
(which shall be the date of the preliminary prospectus supplement included therein, if applicable),
and will not as of the Time of Sale and at the Closing Date, the Time of Sale Prospectus, as then
amended or supplemented by the Company, if applicable, will not, contain any untrue statement of a
material fact or omit to state a material fact necessary 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 and warranties as to information contained in or omitted from the
Registration Statement, the Prospectus or the Time of Sale Prospectus in reliance upon and in
conformity with information furnished in writing to the Company by the Underwriters expressly for
use in the Registration Statement, the Prospectus or the Time of Sale Prospectus or any amendment
or supplement thereto or the Statement of Eligibility and Qualification of the Trustee (the “Form
T-1”) under the Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”).
(c) The Company is not an “ineligible issuer” in connection with the offering pursuant to
Rules 164, 405 and 433 under the Securities Act. Any free writing prospectus that the Company is
required to file pursuant to Rule 433(d) under the Securities Act has
been, or will be, filed with the Commission in accordance with the requirements of the
Securities Act and the applicable rules and regulations of the Commission thereunder.
(d) The Company has been duly incorporated and is validly existing under the laws of the State
of North Carolina, has the corporate power and authority to own its property and to conduct its
business as described in the Time of Sale Prospectus and the Prospectus, and is duly qualified to
transact business as a foreign corporation and is in good standing in each jurisdiction in which
the conduct of its business or its ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or in good standing would not have a
Material Adverse Effect.
(e) The applicable Terms Agreement, incorporating these Standard Provisions, as amended by
agreement of the parties to the applicable Terms Agreement, as of the date of such Terms Agreement
will have been, duly authorized, executed and delivered by the Company.
(f) The Underwritten Securities have been duly authorized and, when issued, executed, and
authenticated in accordance with the provisions of the applicable indenture (the “Indenture”), or
when countersigned by the trustee in accordance with the provisions of the Indenture, as the case
may be, will be entitled to the benefits of the Indenture, and will be valid and binding
obligations of the Company, enforceable against the Company in accordance with their respective
terms, except as such enforceability may be limited by the laws of bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium, or similar laws relating to creditors’ rights
generally, by any other federal or state laws, by rights of acceleration, if applicable, by general
principles of equity.
(g) The Indenture has been duly qualified under the Trust Indenture Act of 1939, as amended
and has been duly authorized, executed, and delivered by the Company and (assuming due
authorization, valid execution, and delivery thereof by the trustee) is a valid and binding
agreement of the Company, enforceable against the Company in accordance with its terms, except as
such enforceability may be limited by the laws of bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium, or similar laws relating to creditors’ rights generally, by any
other federal or state laws, by rights of acceleration, by general principles of equity.
(h) The execution and delivery of and performance by the Company of its obligations under the
applicable Terms Agreement, incorporating these Standard Provisions as amended by agreement of the
parties to such Terms Agreement and the Indenture and the issuance and sale of the Underwritten
Securities, as the case may be, will not contravene any provision of any applicable law or of the
Restated Charter or By-Laws of the Company, or of any agreement or other instrument binding upon
the Company or any of its subsidiaries that is material to the Company and its subsidiaries taken
as a whole, or of any judgment, order, or decree of any governmental body, agency, or court having
jurisdiction over the Company or any of its subsidiaries, in each of the foregoing cases except as
would not reasonably be expected to have a Material Adverse Effect, and no consent, approval,
authorization, or order of or qualification with any governmental body or agency is, to the
Company’s knowledge, required for the performance by the Company of its obligations under the
applicable Terms Agreement, incorporating these Standard Provisions as amended by agreement of the
parties to such Terms Agreement, or the issuance and sale of the Underwritten Securities, except
such as may be required by Blue Sky laws or other securities laws of the various states in which
the issuance and sale of the Underwritten Securities are offered and sold and except to the extent
where the failure to obtain such consent, approval, authorization, order or qualification would not
reasonably be expected to have a Material Adverse Effect.
(i) There has not been any material adverse change (or development involving a prospective
material adverse change) in the business, properties, earnings, or financial condition of the
Company and its subsidiaries on a consolidated basis from that set forth in the Company’s last
periodic report filed with the Commission under the Exchange Act and the rules and regulations
promulgated thereunder. Since the respective dates as of which information is given in the
Registration Statement, the Time of Sale Prospectus and the Prospectus, except as otherwise stated
therein, there has been no dividend or distribution of any kind declared, paid or made by the
Company on any class of its capital stock.
(j) There are no legal or governmental proceedings pending or, to the Company’s knowledge,
threatened, to which the Company or any of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is subject that is required to be described in
the Registration Statement, the Time of Sale Prospectus or the Prospectus and is not so described,
or any applicable statute,
regulation, contract, or other document that is required to be described in the Registration
Statement, the Time of Sale Prospectus or the Prospectus that is not so described.
(k) The independent registered public accounting firm who audited the financial statements and
supporting schedules incorporated by reference in the Registration Statement are independent
registered public accountants as required by the Securities Act.
(l) The financial statements included or incorporated by reference in the Registration
Statement, the Time of Sale Prospectus and the Prospectus, together with the related schedules and
notes, present fairly the financial position of the Company and its consolidated subsidiaries at
the dates indicated and the statement of operations, shareholders’ equity and cash flows of the
Company and its consolidated subsidiaries for the periods specified; said financial statements have
been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”) applied on
a consistent basis throughout the periods involved. The supporting schedules, if any, present
fairly in accordance with GAAP the information required to be stated therein.
Section 8. Default by One or More of the Underwriters. If one or more of the Underwriters
shall fail at the Closing Time to purchase the Underwritten Securities which it or they are
obligated to purchase under the applicable Terms Agreement (the “Defaulted Securities”), then the
remaining Underwriters shall have the right, within 24 hours thereafter, to make arrangements for
one or more of the non-defaulting Underwriters, or any other underwriters, to purchase all, but not
less than all, of the Defaulted Securities in such amounts as may be agreed upon and upon the terms
herein set forth; if, however, the Underwriters shall not have completed such arrangements within
such 24-hour period, then:
(a) if the number or principal amount of Defaulted Securities does not exceed 10% of the
number of Underwritten Securities to be purchased on such date pursuant to such Terms Agreement,
the non-defaulting Underwriters shall be obligated, severally and not jointly, to purchase the full
amount thereof in the proportions that their respective underwriting obligations under such Terms
Agreement bear to the underwriting obligations of all non-defaulting Underwriters, or
(b) if the number or aggregate principal amount of Defaulted Securities exceeds 10% of the
number or aggregate principal amount of Underwritten Securities to be purchased on such date
pursuant to such Terms Agreement, such Terms Agreement shall terminate without liability on the
part of any non-defaulting Underwriter. No action taken pursuant to this Section 8 shall relieve
any defaulting Underwriter from liability in respect of its default.
In the event of any such default which does not result in a termination of the applicable
Terms Agreement, either the Underwriters or the Company shall have the right to postpone the
Closing Time for a period not exceeding seven days in order to effect any required changes in the
Registration Statement or the Prospectus or in any other documents or arrangements.
Section 9. Agreements.
(a) The Company covenants with the Underwriters as follows:
(i) Prior to the filing by the Company of any amendment to the Registration Statement,
the Time of Sale Prospectus or of any prospectus supplement that shall name the Underwriters
or the filing or use of any free writing prospectus, the Company will afford the Underwriters
or their counsel a reasonable opportunity to review and comment on the same, provided,
however, that the foregoing requirement will not apply to any of the Company’s filings with
the Commission required to be filed pursuant to Sections 13(a), 13(c), 14, or 15(d) of the
Exchange Act. Subject to the foregoing sentence, the Company will promptly cause each
applicable prospectus supplement and free writing prospectus to be filed with or transmitted
for filing with the Commission in accordance with Rule 424(b) or 424(c) under the Securities
Act or Rule 433 under the Securities Act, respectively, or pursuant to such other rule or
regulation of the Commission as then deemed appropriate by the Company. The Company will
promptly advise the Underwriters of (A) the filing and effectiveness of any amendment to the
Registration Statement other than by virtue of the Company’s filing any report required to be
filed under the Exchange Act, (B) any request by the Commission for any amendment to the
Registration Statement, for any amendment or supplement to
the Time of Sale Prospectus or the Prospectus, or for any information from the Company,
(C) the issuance by the Commission of any stop order suspending the effectiveness of the
Registration Statement or the institution or threatening of any proceeding for that purpose,
and (D) the receipt by the Company of any notification with respect to the suspension of the
qualification of the
Underwritten Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose. The Company will use reasonable efforts to
prevent the issuance of any such stop order or notice of suspension of qualification and, if
issued, to obtain as soon as reasonably possible the withdrawal thereof.
(ii) If the Time of Sale Prospectus is being used to solicit offers to buy the
Underwritten Securities at a time when the Prospectus is not yet available to prospective
purchasers and any event shall occur or condition exist as a result of which it is necessary
to amend or supplement the Time of Sale Prospectus in order to make the statements therein, in
the light of the circumstances, not misleading, or if any event shall occur or condition exist
as a result of which the Time of Sale Prospectus conflicts with the information contained in
the Registration Statement then on file, or if, in the opinion of counsel for the
Underwriters, it is necessary to amend or supplement the Time of Sale Prospectus to comply
with applicable law, forthwith to prepare, file with the Commission and furnish, at its own
expense, to the Underwriters and to any dealer upon request, either amendments or supplements
to the Time of Sale Prospectus so that the statements in the Time of Sale Prospectus as so
amended or supplemented will not, in the light of the circumstances when delivered to a
prospective purchaser, be misleading or so that the Time of Sale Prospectus, as amended or
supplemented, will no longer conflict with the Registration Statement, or so that the Time of
Sale Prospectus, as amended or supplemented, will comply with applicable law.
(iii) If, at any time when a Prospectus (or in lieu thereof the notice referred to in
Rule 173(a) under the Securities Act) relating to any Underwritten Securities is required to
be delivered under the Securities Act, any event occurs or condition exists as a result of
which the Prospectus would include an untrue statement of a material fact, or omit to state a
material fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, or if it is necessary to amend or supplement the
Prospectus in order to comply with the Securities Act, the Exchange Act, the respective rules
and regulations of the Commission thereunder, or any other applicable law, the Company will
promptly notify the Underwriters, by telephone or by facsimile (in either case with written
confirmation from the Company by mail), to cease use and distribution of the Prospectus (and
all then existing supplements thereto) and to suspend all efforts to resell the Underwritten
Securities in its capacity as underwriter or dealer, as the case may be, and the Underwriters
will promptly comply with the terms of such notice. The Company will forthwith prepare and
cause to be filed with the Commission an amendment or supplement to the Registration Statement
or the Prospectus, as the case may be, satisfactory in the reasonable judgment of the
Underwriters to correct such statement or omission or to effect such compliance, and the
Company will supply the Underwriters with one signed copy of such amended Registration
Statement and as many copies of such amended or supplemented Prospectus as the Underwriters
may reasonably request, provided, however, that the expense of preparing, filing, and
supplying copies to the Underwriters of any such amendment or supplement will be borne by the
Company only for the nine-month period immediately following the purchase of such Underwritten
Securities by the Underwriters and thereafter will be borne by the Underwriters.
(iv) The Company will furnish to the Underwriters, without charge, as many copies of the
Time of Sale Prospectus, the Prospectus, each preliminary prospectus, any documents
incorporated by reference therein, and any supplements and amendments thereto and any free
writing prospectus as the Underwriters may reasonably request.
(v) The Company will, with such assistance from the Underwriters as the Company may
reasonably request, endeavor to qualify the Securities for offer and sale under the Blue Sky
laws or other securities laws of such jurisdictions as the Underwriters shall reasonably
request and will maintain such qualifications for as long as required with respect to the
offer, sale, and distribution of the Securities.
(vi) The Company will make generally available to its security holders earnings
statements that satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
promulgated thereunder.
(b) Each Underwriter, severally and not jointly, covenants with the Company as follows:
(i) It has not and will not use, authorize use of, refer to, or participate in the
planning for use of, any “free writing prospectus,” as defined in Rule 405 under the
Securities Act (which term includes use of any written information furnished to the Commission
by the Company and not incorporated by reference into the Registration Statement and any press
release issued by the Company) (each such
communication by the Company or its agents or
representatives (excluding any Underwriter) an “Issuer Free Writing Prospectus”) other than
(A) a free writing prospectus that contains no “issuer information” (as defined in Rule
433(h)(2) under the Securities Act) that was not included (including through incorporation by
reference) in the preliminary prospectus or a previously filed Issuer Free Writing Prospectus,
(B) any Issuer Free Writing Prospectus listed on Schedule I to the applicable Terms Agreement
or (C) any free writing prospectus prepared by such Underwriter and approved by the Company in
advance in writing (each such free writing prospectus referred to in clauses (A) or (C), an
“Underwriter Free Writing Prospectus”).
(ii) It has not and will not distribute any Underwriter Free Writing Prospectus referred
to in Section 9(b)(i)(A) above in a manner reasonably designed to lead to its broad
unrestricted dissemination.
(iii) It has not and will not, without the prior written consent of the Company, use any
free writing prospectus that contains the final terms of the Underwritten Securities unless
such terms have previously been included in a free writing prospectus filed with the
Commission.
(iv) It is not subject to any pending proceeding under Section 8A of the Securities Act
with respect to the offering (and will promptly notify the Company if any such proceeding
against it is initiated during the “Prospectus Delivery Period”, which means such period of
time beginning on the first date of the public offering of the Underwritten Securities and
ending on the later of the Closing Date or such date, as in the opinion of counsel for the
Underwriters a prospectus relating to the Underwritten Securities is required by law to be
delivered (or required to be delivered but for Rule 172 under the Securities Act) in
connection with sales of the Underwritten Securities by any Underwriter or dealer).
(v) Notwithstanding any of the above, each of the Underwriters may use one or more term
sheets relating to the Underwritten Securities containing customary information, including
Bloomberg email announcement, price talk guidance, comparable bond pricing and final pricing
terms, not inconsistent with the form of the final term sheet set forth in the Terms
Agreement, without the prior consent of the Company, so long as such term sheet is not
required to be filed as a “free writing prospectus” with the Commission pursuant to Rule 433
under the Securities Act.
Section 10. Fees and Expenses. The Company will pay all costs, fees, and expenses arising in
connection with the sale of any Underwritten Securities through the Underwriters and in connection
with the performance by the Company of its obligations hereunder and under any Terms Agreement,
including the following: (i) expenses incident to the preparation and filing of the Registration
Statement, any preliminary prospectus, the Time of Sale Prospectus, the Prospectus, any free
writing prospectus prepared by or on behalf of, used by, or referred to by the Company, and all
amendments and supplements thereto, (ii) expenses incident to the issuance and delivery of such
Underwritten Securities, (iii) the fees and disbursements of counsel for the Company and the
Company’s independent registered public accounting firm, (iv) if approved by the Company in advance
and in writing, expenses incident to the qualification of such Underwritten Securities under Blue
Sky laws and other applicable state securities laws in accordance with the provisions of Section
9(a)(v) hereof, including related filing fees and the reasonable fees and disbursements of the
Underwriters’ counsel in connection therewith and in connection with the preparation of any survey
of Blue Sky laws, (v) expenses incident to the printing and delivery to the Underwriters, in the
quantities hereinabove stated, of copies of the Registration Statement and all amendments thereto
and of the Prospectus, each preliminary prospectus, and all amendments and supplements thereto,
(vi) the fees and expenses, if any, incurred with respect to any applicable filing with the
Financial Industry Regulatory Authority, (vii) the fees and expenses incurred in connection with
the listing of any Underwritten Securities on the NYSE and (viii) if applicable, the fees and
expenses of the trustee under the applicable Indenture. If so stated in the applicable Terms
Agreement, the Underwriters agree to reimburse the Company for the stated amount of its expenses
incurred in connection with the transactions contemplated by the applicable Terms Agreement.
Section 11. Inspection; Place of Delivery; Payment.
(a) Inspection. The Company agrees to have available for inspection, checking, and packaging
by the Underwriters in The City of New York, the Underwritten Securities to be sold to the
Underwriters hereunder, not later than 1:00 P.M. on the Business Day prior to the applicable
Closing Date.
(b) Place of Delivery of Documents, Certificates and Opinions. The documents, certificates and
opinions required to be delivered to the Underwriters pursuant to Sections 5 and 6 hereof will be
delivered at the “Closing Location” specified in the applicable Terms Agreement, or at such other
location as may be agreed upon by the Company and the Underwriters, not later than the Closing
Time.
(c) Payment. Payment of the purchase price for, and delivery of certificates for, the
Underwritten Securities shall be made at the Closing Location, or at such other place as shall be
agreed upon by the Underwriters and the Company, at the “Closing Time” specified in the applicable
Terms Agreement or the applicable written notice from the Representative to the Company in
connection with an election to purchase Optional Securities, as the case may be (the date on which
the Closing Time occurs being referred to as the “Closing Date”), or such other time not later than
ten Business Days after such date as shall be agreed upon by the Representative and the Company.
Payment shall be made to the Company by wire transfer of immediately available funds to a bank
account designated in writing by the Company, against delivery to the Underwriters for the
respective accounts of the Underwriters of the Underwritten Securities to be purchased by them. It
is understood that each Underwriter has authorized the Representative, for its account, to accept
delivery of, receipt for, and make payment of the purchase price for, the Underwritten Securities
which it has severally agreed to purchase. The Representative, individually and not as
representative of the Underwriters, may (but shall not be obligated to) make payment of the
purchase price for the Underwritten Securities to be purchased by any Underwriter whose funds have
not been received by the Closing Time, but such payment shall not relieve such Underwriter from its
obligations hereunder.
Section 12. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold each Underwriter and each person, if any, who
controls any Underwriter within the meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act, harmless from and against any and all losses, claims, damages, or
liabilities to which such Underwriter come subject under the Securities Act, the Exchange Act, or
any other federal or state law or regulation, at common law or otherwise, insofar as such losses,
claims, damages, or liabilities (and actions in respect thereof) arise out of, are based upon, or
are caused by any untrue statement or allegedly untrue statement of a material fact contained in
the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, the
Prospectus, any Issuer Free Writing Prospectus or in any amendment or supplement thereto, or arise
out of, are based upon or are caused by any 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 the Company agrees to reimburse each such indemnified party for any reasonable
legal or other expenses reasonably 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 to the extent that such losses, claims, damages, or liabilities (or actions in respect
thereof) arise out of, are based upon, or are caused by any such untrue statement or omission or
allegedly untrue statement or omission included in or omitted from the Registration Statement, any
preliminary prospectus or the Prospectus in reliance upon and in conformity with information
furnished by the Underwriters in writing expressly for use in the Registration Statement or such
preliminary prospectus or the Time of Sale Prospectus or the Prospectus or any amendment or
supplement thereto.
(b) Each Underwriter severally agrees to indemnify and hold harmless the Company, its
directors, its officers who sign the Registration Statement, and each person, if any, who controls
the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, to the same extent as the foregoing indemnity from the Company to the Underwriters,
but only with respect to such losses, claims, damages, and liabilities (and actions in respect
thereof) that arise out of, are based upon, or are caused by any untrue statement or omission of a
material fact or allegedly untrue statement or omission of a material fact included in or omitted
from the Registration Statement, or any preliminary prospectus or the Time of Sale Prospectus or
the Prospectus in reliance upon and in conformity with information furnished by the Underwriters in
writing expressly for use in the Registration Statement or such preliminary prospectus or the Time
of Sale Prospectus or the Prospectus or any amendment or supplement thereto.
(c) In case any proceeding (including any governmental investigation) shall be instituted
involving any person in respect of which indemnity may be sought pursuant to either paragraph (a)
or (b) of this
Section 12, such person (the “indemnified party”) will promptly notify the person against whom
such indemnity may be sought (the “indemnifying party”) in writing and the indemnifying party, upon
request of the indemnified party, will retain counsel reasonably satisfactory to the indemnified
party to represent
the indemnified party and any others the indemnifying party may designate in
such proceeding and will pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party will have the right to retain its own counsel, but
the fees and expenses of such counsel will be borne by the indemnified party unless (i) the
indemnifying party and the indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and, in the judgment of the indemnified
party, representation of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the indemnifying party will not,
in connection with any proceeding or related proceedings in the same jurisdiction, be liable for
the fees and expenses of more than one separate firm (in addition to any local counsel) for all
such indemnified parties and that all such reasonable fees and expenses will be reimbursed as they
are incurred. Such firm will be designated in writing by the Underwriters (in the case of parties
indemnified pursuant to paragraph (a) of this Section 12) or by the Company (in the case of parties
indemnified pursuant to paragraph (b) of this Section 12), as the case may be. The indemnifying
party will not be liable for any settlement of any proceeding effected without its written consent,
but if settled with such consent, or if there shall be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against any loss or liability
by reason of such settlement or judgment. No indemnifying party will, without the prior written
consent of the indemnified party, effect any settlement of any pending or threatened proceeding 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 claims that are the subject matter of such
proceeding. Any provision of this paragraph (c) to the contrary notwithstanding, no failure by an
indemnified party to notify the indemnifying party as required hereunder will relieve the
indemnifying party from any liability it may have had to an indemnified party otherwise than under
this Section 12 to the extent the indemnifying party is not materially prejudiced as a result
thereof and in any event shall not relieve it from any liability which it may have otherwise than
on account of this indemnity agreement.
(d) If the indemnification provided for in paragraph (a) or (b) of this Section 12 is
unavailable to an indemnified party or is insufficient in respect of any losses, claims, damages,
or liabilities referred to therein, then each indemnifying party under such paragraph, in lieu of
indemnifying the indemnified party thereunder, will contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages, or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the Company, on the one
hand, and the Underwriters, on the other, from the offering of the Underwritten Securities pursuant
to the applicable Terms Agreement, or (ii) if the allocation provided by clause (i) is not
permitted by applicable law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the Company, on the one
hand, and the Underwriters, on the other, in connection with the statements or omissions that
resulted in such losses, claims, damages, or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company, on the one hand, and the
Underwriters, on the other, in connection with the offering of the Underwritten Securities pursuant
to the applicable Terms Agreement shall be deemed to be in the same respective proportions as the
total net proceeds from the offering of such Underwritten Securities (before deducting expenses)
received by the Company and the total underwriting discount received by the Underwriters, in each
case as set forth on the cover of the Prospectus, bear to the aggregate initial public offering
price of such Underwritten Securities as set forth on such cover. The relative fault of the
Company, on the one hand, and of the Underwriters, on the other, will be determined by reference
to, among other things, whether the untrue or allegedly untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information supplied or to be
supplied by the Company or by the Underwriters and the parties’ relative intent, knowledge, access
to information, and opportunity to correct or prevent such statement or omission. The Underwriters’
respective obligations to contribute pursuant to this Section 12(d) are several in proportion to
the number of Underwritten Securities set forth opposite their respective names in the applicable
Terms Agreement, and not joint.
(e) The Company and the Underwriters agree that it would not be just or equitable if
contribution pursuant to paragraph (d) above were determined by pro rata allocation or by any other
method of
allocation that does not take account of the equitable considerations referred to therein. The
amount paid or payable by an indemnified party as a result of the losses, claims, damages, and
liabilities referred to in paragraph (d) above will be deemed to include, subject to the
limitations set forth above, any reasonable legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or
defending any such action or claim. Any other
provisions of this Section 12 to the contrary notwithstanding, (i) the Underwriters will not be
required to contribute to the Company any amount in excess of the amount by which the total price
at which the Underwritten Securities underwritten by it and distributed to the public were offered
to the public exceeds the amount of any damages which such Underwriter has otherwise been required
to pay by reason of any such untrue or alleged untrue statement or omission or alleged omission
(other than in reliance upon and in conformity with information furnished to the Company by the
Underwriters in writing expressly for use in the Registration Statement, the preliminary prospectus
or the Prospectus or any amendment or supplement thereto), and (ii) no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to
contribution from any person who was not guilty of such fraudulent misrepresentation.
(f) The remedies provided for in this Section 12 are not exclusive and will not limit any
rights or remedies that may otherwise be available to any indemnified party at law or in equity.
Section 13. Termination. The applicable Terms Agreement will automatically terminate upon the
expiration of the offering to which the Prospectus relates. The applicable Terms Agreement may not
be terminated by the Underwriters prior to delivery of and payment for such Securities except upon
the failure of any of the conditions precedent described in Section 6 hereof.
Section 14. Survival. The respective indemnities, rights of contribution, representations,
warranties and agreements of the Company and the Underwriters contained herein or made by or on
behalf of the Company or the Underwriters pursuant hereto, any certificate delivered pursuant
hereto and Section 18 shall survive the delivery of and payment for the Underwritten Securities and
shall remain in full force and effect, regardless of any termination of a Terms Agreement or any
investigation made by or on behalf of the Company or the Underwriters.
Section 15. Notices. All notices, documents and other communications hereunder shall be in
writing and shall be deemed received upon delivery, if delivered by hand or via facsimile
transmission (with confirmation of receipt) to a party’s address or facsimile number set forth
below, in the case of the Company, and in the applicable Terms Agreement, in the case of the
Underwriters or the Representative (or to such other address or facsimile number as a party may
hereafter designate to the other parties in writing), and shall be deemed received one Business Day
after having been mailed via Express Mail or deposited with Federal Express or any nationally
recognized commercial courier service for “next day” delivery to such address. In the event that
any Terms Agreement or any certificate or opinion to be delivered pursuant to Section 5 hereof is
delivered via facsimile transmission, the parties will use reasonable efforts to ensure that
“original” copies of such documents are distributed promptly thereafter.
The address and facsimile number for the Company, unless otherwise specified, is as follows:
PepsiCo, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Att’n: Chief Financial Officer
General Counsel
Facsimile no: ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Att’n: Chief Financial Officer
General Counsel
Facsimile no: ▇▇▇-▇▇▇-▇▇▇▇
Section 16. Successors; Non-transferability. The applicable Terms Agreement shall inure to the
benefit of and be binding upon the Company and the Underwriters, their respective successors, and
the officers, directors, and controlling persons referred to in Section 12 hereof. No other person
will have any right or obligation hereunder. No party to the applicable Terms Agreement may assign
its rights thereunder without the written consent of the other parties.
Section 17. Counterparts. The Terms Agreement may be signed in any number of counterparts,
each of which will be an original, with the same effect as if the signatures thereto and hereto
were upon the same instrument.
Section 18. Applicable Law. These Standard Provisions and any applicable Terms Agreement will
be governed by and construed in accordance with the laws of the State of New York without regard to
principles of conflicts of law.
Section 19. Headings. The headings of the sections of these Standard Provisions have been
inserted for convenience of reference only and will not affect the construction of any of the terms
or provisions hereof.
Section 20. No Advisory or Fiduciary Relationships. The Company acknowledges and agrees that
(a) the purchase and sale of the Underwritten Securities pursuant to the Standard Provisions and
the applicable Terms Agreement, including the determination of the public offering price of the
Underwritten Securities and any related discounts and commissions, is an arm’s-length commercial
transaction between the Company, on the one hand, and the several Underwriters, on the other hand,
(b) in connection with the offering contemplated hereby and the process leading to such transaction
each Underwriter is and has been acting solely as a principal and is not the agent or fiduciary of
the Company, or its stockholders, creditors, employees or any other party, (c) no Underwriter has
assumed or will assume an advisory or 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) and no Underwriter
has any obligation to the Company with respect to the offering contemplated hereby except the
obligations expressly set forth in the Standard Provisions and the applicable Terms Agreement, (d)
the Underwriters and their respective affiliates may be engaged in a broad range of transactions
that involve interests that differ from those of the Company, and (e) the Underwriters have not
provided any legal, accounting, regulatory or tax advice with respect to the offering contemplated
hereby and the Company has consulted its own legal, accounting, regulatory and tax advisors to the
extent it deemed appropriate.
Exhibit A
PEPSICO, INC.
[IDENTIFY UNDERWRITTEN SECURITIES]
TERMS AGREEMENT
[Date]
To:
|
PepsiCo, Inc. | |
| ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇ | ||
| ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ |
Ladies and Gentlemen:
We understand that PepsiCo, Inc., a North Carolina corporation (the “Company”), proposes to
issue and sell [describe Underwritten Securities, and specify if Underwritten Securities include
both Firm Securities and Optional Securities] (such securities also being hereinafter referred to
as the “Underwritten Securities”) subject to the terms and conditions stated herein and in the
PepsiCo, Inc. Underwriting Agreement Standard Provisions dated as of October [___], 2008 attached
hereto (the “Standard Provisions”). Each of the applicable provisions in the Standard Provisions is
incorporated herein by reference in its entirety, and shall be deemed to be a part of this
Agreement to the same extent as if such provisions had been set forth in full herein. We, the
underwriters named below (the “Underwriters”), offer to purchase, severally and not jointly, the
number or amount of [Underwritten] [Firm] Securities opposite our names set forth below at a
purchase price set forth below.
| [Number] [Principal | ||||
| Amount] of | ||||
| [Underwritten] [Firm] | ||||
| Underwriters | Securities | |||
[Name] |
||||
Total |
$ | |||
The Underwritten Securities and the offering thereof shall have the following additional
terms:
Terms of the Underwritten Securities and the Offering
[Number][Principal Amount] of
Underwritten Securities
[Number of Firm Securities]
[Number of Optional Securities]
Initial public offering price
Purchase price
Lock-up period specified in Section 9(a)(vi) of the Standard Provisions (if applicable)
Underwritten Securities
[Number of Firm Securities]
[Number of Optional Securities]
Initial public offering price
Purchase price
Lock-up period specified in Section 9(a)(vi) of the Standard Provisions (if applicable)
___days beginning from the date of this Terms Agreement
Time of Sale Prospectus
Base Prospectus dated October ___, 2008, preliminary prospectus supplement dated ___, 20___,
Time of Sale Prospectus
Base Prospectus dated October ___, 2008, preliminary prospectus supplement dated ___, 20___,
Representative of the Underwriters
Address and facsimile number for notices to the Representative and the Underwriters
Time of Sale
Closing Time
Address and facsimile number for notices to the Representative and the Underwriters
Time of Sale
Closing Time
Closing Location
Other terms and conditions
[Amount of reimbursement to the Company from the Underwriters]
Other terms and conditions
[Amount of reimbursement to the Company from the Underwriters]
The Representative represents and warrants that it is duly authorized to execute and deliver
this Terms Agreement on behalf of the several Underwriters named above.
Exhibit B-1
FORM OF OPINION OF COMPANY’S NEW YORK COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(a)
TO BE DELIVERED PURSUANT TO SECTION 5(a)
[▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ Letterhead]
October 24, 2008
| Re: | PepsiCo, Inc. 7.90% Senior Notes due 2018 |
▇▇▇▇▇▇▇
Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
Incorporated
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
UBS Securities LLC
The ▇▇▇▇▇▇▇▇ Capital Group, L.P.
UBS Securities LLC
The ▇▇▇▇▇▇▇▇ Capital Group, L.P.
as Representatives of the several Underwriters named in the Underwriting
Agreement referred to below
| c/o | Merrill Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated 4 World Financial Center ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ |
Ladies and Gentlemen:
We have acted as special counsel for PepsiCo, Inc. (the “Company”), a North Carolina
corporation, in connection with the Terms Agreement dated October 21, 2008 (together with the
incorporated Underwriting Agreement Standard Provisions dated October 21, 2008, the “Underwriting
Agreement”) among the Company and you, as representatives of the several underwriters named therein
(the “Underwriters”), under which you and the other Underwriters have severally agreed to purchase
from the Company $2,000,000,000 aggregate principal amount of its 7.90% Senior Notes due 2018 (the
“Notes”). The Notes are to be issued pursuant to the provisions of an Indenture dated as of May
21, 2007 (the “Indenture”) between the Company and The Bank of New York Mellon, as Trustee. This
opinion is furnished to you at the request of the Company pursuant to Section 5(a) of the
Underwriting Agreement.
We have examined originals or copies, certified or otherwise identified to our satisfaction,
of such documents, corporate records, certificates of public officials and other instruments as we
have deemed necessary or advisable for the purpose of rendering this opinion.
We have participated in the preparation of the Company’s registration statement on Form S-3
(File No. 333-154314) (other than the documents incorporated by reference therein (the
“Incorporated Documents”)) filed with the Securities and Exchange Commission (the “Commission”)
pursuant to the provisions of the Securities Act of
1933, as amended (the “Act”), relating to the registration of securities (the “Shelf
Securities”) to be issued from time to time by the Company, the preliminary prospectus supplement
dated October 21, 2008 relating to the Notes, the free writing prospectus set forth in Schedule II
to the Underwriting Agreement (the “Issuer Free Writing Prospectus”) and the prospectus supplement
dated October 21, 2008 relating to the Notes (the “Prospectus Supplement”), and have reviewed the
Incorporated Documents. The registration statement became effective under the Act upon the filing
of the registration statement with the Commission on October 15, 2008 pursuant to Rule 462(e) under
the Act. The registration statement at the date of the Underwriting Agreement, including the
Incorporated Documents and the information deemed to be part of the registration statement at the
time of effectiveness pursuant to Rule 430B under the Act, is hereinafter referred to as the
“Registration Statement,” and the related prospectus (including the Incorporated Documents) dated
October 15, 2008 relating to the Shelf Securities is hereinafter referred to as the “Basic
Prospectus.” The Basic Prospectus, as supplemented by the Prospectus Supplement, in the form first
used to confirm sales of the Notes (or in the form first made available by the Company to the
Underwriters to meet requests of purchasers of the Notes under Rule 173 under the Act), is
hereinafter referred to as the “Prospectus.”
We have assumed the conformity of the documents filed with the Commission via the Electronic
Data Gathering, Analysis and Retrieval System (“▇▇▇▇▇”), except for required ▇▇▇▇▇ formatting
changes, to physical copies of the documents submitted for our examination.
Based upon the foregoing, we are of the opinion that:
1. The Indenture was duly qualified under the Trust Indenture Act of 1939, as
amended, upon the filing of the Registration Statement with the Commission on October 15,
2008 pursuant to Rule 462(e) under the Act, and assuming due authorization, execution and
delivery thereof by the Company, the Indenture is a valid and binding agreement of the
Company, enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency and similar laws affecting creditors’ rights generally, concepts of
reasonableness and equitable principles of general applicability, provided that counsel
need not express any opinion as to (w) the enforceability of any waiver of rights under any
usury or stay law, (x) the applicability (and if applicable, the effect) of ▇▇▇▇▇▇▇ ▇▇▇ ▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Bankruptcy Code or any comparable provision of state law to the questions
addressed above or on the conclusions expressed with respect thereto, or (y) the validity,
legally binding effect or enforceability of any provision that permits holders to collect
any portion of stated principal amount upon acceleration of the Notes to the extent
determined to constitute unearned interest.
2. Assuming the due authorization of the Notes by the Company, the Notes, when
executed and authenticated in accordance with the provisions of the Indenture and delivered
to and paid for by the Underwriters pursuant to the Underwriting Agreement, will be valid
and binding obligations of the Company, enforceable in accordance with their terms, subject
to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights
generally, concepts of
reasonableness and equitable principles of general applicability, and will be entitled
to the benefits of the Indenture pursuant to which such Notes are to be issued, provided
that counsel need not express any opinion as to (w) the enforceability of any waiver of
rights under any usury or stay law, (x) the applicability (and if applicable, the effect)
of ▇▇▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Bankruptcy Code or any comparable provision of state
law to the questions addressed above or on the conclusions expressed with respect thereto,
or (y) the validity, legally binding effect or enforceability of any provision that permits
holders to collect any portion of stated principal amount upon acceleration of the Notes to
the extent determined to constitute unearned interest.
3. No consent, approval, authorization, or order of, or qualification with, any
state governmental body or agency under the laws of the State of New York or any federal
law of the United States of America that in our experience is normally applicable to
general business corporations in relation to transactions of the type contemplated by the
Indenture, the Notes and the Underwriting Agreement (collectively, the “Documents”) is
required for the execution, delivery and performance by the Company of its obligations
under the Documents, except such as may be required under federal or state securities or
Blue Sky laws as to which we express no opinion in this paragraph (3).
4. Any required filing of the Prospectus pursuant to Rule 424(b) under the Act has
been made in the manner and within the time period required by Rule 424(b); any required
filing of the Issuer Free Writing Prospectus pursuant to Rule 433 under the Act has been
made in the manner and within the time period required by Rule 433(d); and, to our
knowledge, no stop order suspending the effectiveness of the Registration Statement has
been issued under the Act and no proceedings for that purpose have been instituted or are
pending or threatened by the Commission.
5. We have considered the statements included in the Prospectus under the captions
“Description of Debt Securities” and “Description of Notes” insofar as they summarize
provisions of the Indenture and the Notes. In our opinion, such statements fairly summarize
these provisions in all material respects.
6. The statements included in the Prospectus under the caption “Material United
States Federal Tax Considerations,” insofar as they purport to describe provisions of U.S.
federal income tax laws or legal conclusions with respect thereto, fairly and accurately
summarize the matters referred to therein in all material respects.
In rendering the opinions in paragraphs (1) through (3) above, we have assumed that each
party to the Documents has been duly incorporated and is validly existing and in good standing
under the laws of the jurisdiction of its organization. In addition, we have assumed that the
execution, delivery and performance by each party thereto of each Document to which it is a party,
(i) are within its corporate powers, (ii) do not contravene, or constitute a default under, the
certificate of incorporation or bylaws or other constitutive documents of such party, (iii) other
than as expressly covered in
paragraph (3) above in respect of the Company, require no action by or in respect of, or
filing with, any governmental body, agency or official and (iv) do not contravene, or constitute a
default under, any provision of applicable law or regulation or any judgment, injunction, order or
decree or any agreement or other instrument binding upon such party, and that each Document is a
valid, binding and enforceable agreement of each party thereto, other than the Company.
We are members of the Bar of the State of New York, and the foregoing opinion is limited to
the laws of the State of New York and the federal laws of the United States of America. Insofar as
the foregoing opinion involves matters governed by the laws of the State of North Carolina, we have
relied without independent investigation on the opinion of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ & ▇▇▇▇, PLLC
delivered to you today pursuant to the Underwriting Agreement.
This opinion is rendered solely to you and the other several Underwriters in connection with
the Underwriting Agreement. This opinion may not be relied upon by you for any other purpose or
relied upon by any other person (including any person acquiring Notes from the several
Underwriters) or furnished to any other person without our prior written consent.
Exhibit B-2
FORM OF DISCLOSURE LETTER OF COMPANY’S NEW YORK
COUNSEL TO BE DELIVERED PURSUANT TO SECTION 5(a)
COUNSEL TO BE DELIVERED PURSUANT TO SECTION 5(a)
[▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ Letterhead]
October 24, 2008
| Re: | PepsiCo, Inc. 7.90% Senior Notes due 2018 |
▇▇▇▇▇▇▇
Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
Incorporated
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
UBS Securities LLC
The ▇▇▇▇▇▇▇▇ Capital Group, L.P.
UBS Securities LLC
The ▇▇▇▇▇▇▇▇ Capital Group, L.P.
as Representatives of the several Underwriters named in the Underwriting
Agreement referred to below
| c/o | Merrill Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated 4 World Financial Center ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ |
Ladies and Gentlemen:
We have acted as special counsel for PepsiCo, Inc. (the “Company”), a North Carolina
corporation, in connection with the Terms Agreement dated October 21, 2008 (together with the
incorporated Underwriting Agreement Standard Provisions dated October 21, 2008, the “Underwriting
Agreement”) among the Company and you, as representatives of the several underwriters named therein
(the “Underwriters”), under which you and the other Underwriters have severally agreed to purchase
from the Company $2,000,000,000 aggregate principal amount of its 7.90% Senior Notes due 2018 (the
“Notes”). The Notes are to be issued pursuant to the provisions of an Indenture dated as of May
21, 2007 (the “Indenture”) between the Company and The Bank of New York Mellon, as Trustee (the
“Trustee”). This opinion is furnished to you at the request of the Company pursuant to Section
5(a) of the Underwriting Agreement.
We have participated in the preparation of the Company’s registration statement on Form S-3
(File No. 333-154314) (other than the documents incorporated by reference therein (the
“Incorporated Documents”)) filed with the Securities and Exchange Commission (the “Commission”)
pursuant to the provisions of the Securities Act of 1933, as amended (the “Act”), relating to the
registration of securities (the “Shelf Securities”) to be issued from time to time by the Company,
the preliminary prospectus supplement dated October 21, 2008 (the “Preliminary Prospectus
Supplement”) relating to the Notes, the free writing prospectus set forth in Schedule II to the
Underwriting Agreement and the prospectus supplement dated October 21, 2008 relating to the Notes
(the “Prospectus Supplement”), and have reviewed the Incorporated Documents. The registration
statement became effective under the Act upon the filing of the registration statement with the
Commission on October 15, 2008 pursuant to Rule 462(e) under the Act. The registration statement
at the date of the Underwriting Agreement, including the Incorporated Documents and the information
deemed to be part of the registration statement at the time of effectiveness pursuant to Rule 430B
under the Act, is hereinafter referred to as the “Registration Statement,” and the related
prospectus (including the Incorporated Documents) dated October 15, 2008 relating to the Shelf
Securities is hereinafter referred to as the “Basic Prospectus.” The Basic Prospectus, as
supplemented by the Preliminary Prospectus Supplement, together with the free writing prospectus
set forth in Schedule II to the Underwriting Agreement for the Notes are hereinafter referred to as
the “Disclosure Package.” The Basic Prospectus, as supplemented by the Prospectus Supplement, in
the form first used to confirm sales of the Notes (or in the form first made available by the
Company to the Underwriters to meet requests of purchasers of the Notes under Rule 173 under the
Act), is hereinafter referred to as the “Prospectus.”
We have assumed the conformity of the documents filed with the Commission via the Electronic
Data Gathering, Analysis and Retrieval System (“▇▇▇▇▇”), except for required ▇▇▇▇▇ formatting
changes, to physical copies of the documents submitted for our examination.
We note that many determinations involved in the preparation of the Registration Statement,
the Disclosure Package and the Prospectus are of a wholly or partially non-legal character or
relate to legal matters outside the scope of our opinion separately delivered to you today in
respect of certain matters under the laws of the State of New York and the federal laws of the
United States of America. As a result, we are not passing upon, and do not assume any
responsibility for, the accuracy, completeness or fairness of the statements contained in the
Registration Statement, the Disclosure Package and the Prospectus, and we have not ourselves
checked the accuracy, completeness or fairness of, or otherwise verified, the information furnished
in such documents (except to the extent expressly set forth in our opinion letter separately
delivered to you today as to statements included in the Prospectus under the captions “Description
of Notes,” “Material United States Federal Tax Considerations” and “Description of Debt
Securities”). However, in the course of our acting as counsel to the Company in connection with
the preparation of the Registration Statement, the Disclosure Package and the Prospectus, we have
generally reviewed and discussed with your representatives and your counsel and with certain
officers and employees of, and independent public accountants for, the Company the information
furnished, whether or not subject to our check and verification. We have also reviewed and relied
upon certain corporate records and documents, letters from counsel and accountants and oral and
written statements of officers and other representatives of the Company and others as to the
existence and consequence of certain factual and other matters.
On the basis of the information gained in the course of the performance of the services
rendered above, but without independent check or verification except as stated above:
(i) the Registration Statement and the Prospectus appear on their face to be appropriately
responsive in all material respects to the requirements of the Act and the applicable rules and
regulations of the Commission thereunder; and
(ii) nothing has come to our attention that causes us to believe that, insofar as relevant to
the offering of the Notes:
(a) on the date of the Underwriting Agreement, the Registration Statement contained
any 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,
(b) at the Time of Sale, the Time of Sale Prospectus contained any untrue statement of
a material fact or omitted 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, or
(c) the Prospectus as of the date of the Underwriting Agreement or as of the Closing
Date contained or contains any untrue statement of a material fact or omitted or omits 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.
In providing this letter to you and the other several Underwriters, we have not been called
to pass upon, and we express no view regarding, the financial statements or financial schedules or
other financial or accounting data included in the Registration Statement, the Time of Sale
Prospectus, the Prospectus, or the Statement of Eligibility of the Trustee on Form T-1. In
addition, we express no view as to the conveyance of the Time of Sale Prospectus or the information
contained therein to investors.
This letter is delivered solely to you and the other several Underwriters in connection with
the Underwriting Agreement. This letter may not be relied upon by you for any other purpose or
relied upon by any other person (including any person acquiring Notes from the several
Underwriters) or furnished to any other person without our prior written consent.
| Very truly yours, |
||||
Exhibit B-3
FORM OF OPINION OF COMPANY’S INTERNAL COUNSEL TO BE
DELIVERED PURSUANT TO SECTION 5(a)
DELIVERED PURSUANT TO SECTION 5(a)
October 24, 2008
▇▇▇▇▇▇▇
Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
UBS Securities LLC
The ▇▇▇▇▇▇▇▇ Capital Group, L.P.
UBS Securities LLC
The ▇▇▇▇▇▇▇▇ Capital Group, L.P.
as Representatives of the several Underwriters named in the Underwriting Agreement
referred to below
c/o
Merrill Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
Merrill Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
4 World Financial Center
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
I am Senior Vice President, Deputy General Counsel and Assistant Secretary of PepsiCo, Inc., a
North Carolina corporation (the “Company”), and have acted in such capacity in connection with the
Terms Agreement, dated October 21, 2008 (incorporating the Underwriting Agreement Standard
Provisions dated October 21, 2008) (the “Terms Agreement” and together with the Standard
Provisions, the “Underwriting Agreement”) between the Company and you, as representative of the
several underwriters named in the Terms Agreement thereto (the “Underwriters”), under which you and
the other Underwriters have severally agreed to purchase from the Company $2,000,000,000 aggregate
principal amount of its 7.90% Senior Notes due 2018 (the “Notes”). The Notes are to be issued
pursuant to the provisions of an Indenture dated as of May 21, 2007 (the “Indenture”) between the
Company and The Bank of New York Mellon, as Trustee (the “Trustee”). Capitalized terms used herein
and not otherwise defined herein have the meanings given to them in the Underwriting Agreement.
I have examined originals or copies, certified or otherwise identified to my satisfaction, of
such documents, corporate records, certificates of public officials and other instruments as I have
deemed necessary for the purposes of rendering this opinion. I have assumed the capacity of all
natural persons and the genuineness of all signatures.
Based upon the foregoing, I am of the opinion that:
1. The execution, delivery and performance by the Company of its obligations under the
Underwriting Agreement, the Indenture and the Notes will not contravene any
provision of the Restated Charter or By-Laws of the Company, or of any agreement or other
instrument binding upon the Company or any of its subsidiaries that is material to the Company and
its subsidiaries taken as a whole, or, to counsel’s knowledge, of any judgment, order, or decree of
any governmental body, agency, or court having jurisdiction over the Company or any of its
subsidiaries, in each of the foregoing cases except as would not reasonably be expected to have a
material adverse effect on the business, financial condition or results of operations of the
Company and its subsidiaries, taken as a whole.
2. To counsel’s knowledge, there is no legal or governmental proceeding pending or threatened
to which the Company or any of its significant subsidiaries is a party, or by which any of the
properties of the Company or its significant subsidiaries is bound, which would reasonably be
expected to have a material adverse effect on the business, financial condition or results of
operations of the Company and its subsidiaries, taken as a whole; and to counsel’s knowledge, there
is no agreement or other document that is required to be described in the Registration Statement,
the Prospectus or the Time of Sale Prospectus, or that is required to be filed as an exhibit to the
Registration Statement, that is not so described or filed.
In rendering such opinion, I may rely, as to matters of fact, to the extent I deem proper, on
certificates of responsible officers of the Company and public officials. Such opinion will be
limited to the laws of the State of New York and the federal laws of the United States of America.
Insofar as such opinion involves matters governed by the laws of North Carolina, I am relying, with
your permission without independent investigation, on the opinion of North Carolina counsel for the
Company.
This opinion is rendered solely to you in connection with the above matter at the request of
the Company. This opinion may not be relied upon by you for any other purpose or relied upon by or
furnished to any other person without my prior written consent.
| Very truly yours, | ||||
| Senior Vice President, Deputy General | ||||
| Counsel and Assistant Secretary |
Exhibit B-4
FORM OF OPINION OF COMPANY’S NORTH CAROLINA COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(a)
TO BE DELIVERED PURSUANT TO SECTION 5(a)
[WCSR LETTERHEAD]
October 24, 2008
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
Incorporated
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
UBS Securities LLC
The ▇▇▇▇▇▇▇▇ Capital Group, L.P.
UBS Securities LLC
The ▇▇▇▇▇▇▇▇ Capital Group, L.P.
as Representatives of the several Underwriters named in the Underwriting Agreement
| c/o | Merrill Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated 4 World Financial Center ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ |
| Re: | PepsiCo, Inc. |
Ladies and Gentlemen:
We have acted as special North Carolina counsel to PepsiCo, Inc., a North Carolina corporation
(the “Company”), in connection with the Terms Agreement dated October 21, 2008 (incorporating by
reference the Underwriting Agreement Standard Provisions (the “Standard Provisions”) dated October
21, 2008) (the “Terms Agreement” and, together with the Standard Provisions, the “Underwriting
Agreement”) between the Company and you, as representatives of the several underwriters named in
the Underwriting Agreement (the “Underwriters”), under which you and the other Underwriters have
severally agreed to purchase from the Company $2,000,000,000 aggregate principal amount of its
7.90% Senior Notes Due 2018 (the “Notes”). The Notes are to be issued pursuant to the provisions
of an indenture dated as of May 21, 2007 between the Company and The Bank of New York Mellon, as
trustee (the “Indenture”). This opinion is delivered to you pursuant to Section 5(a) of the
Standard Provisions. Capitalized terms used and not otherwise defined in this opinion have the
meanings given to them in the Underwriting Agreement.
As the Company’s special North Carolina counsel, we have reviewed the Company’s articles of
incorporation and by-laws, each as amended to date, and the Underwriting Agreement, and have
examined the originals, or copies certified or otherwise identified to our satisfaction, of
corporate records, certificates of public
officials and of representatives of the Company, statutes and other instruments and documents, as a
basis for the opinions hereinafter expressed. In rendering this opinion, we have relied upon
certificates of public officials and representatives of the Company with respect to the accuracy of
the factual matters contained in such certificates.
In connection with such review, we have assumed with your permission (a) that the Underwriting
Agreement, the Indenture and all other documents that are the subject of this opinion or on which
this opinion is based (the “Transaction Documents”) have been properly authorized, executed and
delivered by each of the respective parties thereto other than the Company; (b) the genuineness of
all signatures and the legal capacity of all signatories; (c) the authenticity of all documents
submitted to us as originals and the conformity to original documents of all documents submitted to
us as certified or photostatic copies; (d) the proper issuance and accuracy of certificates of
public officials and representatives of the Company; (e) the due authentication of the Notes in
accordance with the Indenture and payment by the Underwriters of the purchase price for the Notes
in accordance with the Underwriting Agreement; and (f) the truth and accuracy of the
representations, warranties and covenants of the Underwriters set forth in the Underwriting
Agreement.
This opinion is limited to the laws of the State of North Carolina, excluding local laws of
the State of North Carolina (i.e., the statutes and ordinances, the administrative decisions and
the rules and regulations of counties, towns, municipalities and special political subdivisions of,
or authorities or quasi-governmental bodies constituted under the laws of, the State of North
Carolina and judicial decisions to the extent they deal with any of the foregoing) and the
securities or Blue Sky laws of the State of North Carolina, and we are expressing no opinion as to
the effect of the laws of any other jurisdiction.
The opinion in paragraph 1 relating to the existence of the Company in the State of North
Carolina is given solely in reliance on a certificate of existence issued by the Secretary of State
of the State of North Carolina dated October 24, 2008.
Based on and subject to the foregoing and the qualifications and limitations set forth below,
and having regard for such legal considerations as we deem relevant, it is our opinion that:
1. The Company is a corporation in existence under the laws of the State of North Carolina,
with corporate power to conduct its business as described in the Time of Sale Prospectus and the
Prospectus.
2. The Company has authorized by all necessary corporate action the execution and delivery of
the Underwriting Agreement, the Indenture and the Notes.
3. The Underwriting Agreement, the Indenture and the Notes have been duly executed by the
Company.
4. The execution and delivery of and performance by the Company of its obligations under the
Underwriting Agreement, the Indenture and the Notes do not violate any provision of the articles of
incorporation or by-laws of the Company.
5. No consent, approval, authorization, or order of or qualification with any North Carolina
governmental body or agency is required to be obtained or made by the Company for the execution,
delivery and performance by the Company of the Underwriting Agreement or the issuance of the Notes,
except as may be required by the Blue Sky or other securities laws if the Notes are offered or sold
in North Carolina and except for consents, approvals, authorizations, actions, filings and
registrations which, if not obtained or made, are not reasonably likely to have a material adverse
effect on the business, financial condition or results of operations of the Company and its
subsidiaries, taken as a whole.
Nothing contained in this opinion letter shall be construed as an opinion as to the
enforceability of the Transaction Documents or as an opinion as to whether the execution and
delivery of the Indenture and the Notes, or the authorization thereof, comply with applicable
provisions of such instruments and of the Trust Indenture Act of 1939, as amended. This opinion
letter is delivered solely for your benefit in connection with the Underwriting Agreement and the
transactions provided for therein and may not be quoted in whole or in part, referred to, filed
with any governmental agency or otherwise used or relied upon by any other person or for any other
purpose without our prior written consent.
This opinion is rendered as of the date hereof, and we undertake no obligation to advise you
of any changes in applicable law or any other matters that may come to our attention after the date
hereof.
| Very truly yours, |
||||
KNS
RHP
RHP
Exhibit C
FORM OF ASSISTANT SECRETARY’S CERTIFICATE
I, , the duly qualified, elected, and acting Secretary of PepsiCo,
Inc., a company organized under the laws of the State of North Carolina (the “Company”), hereby
certify as follows:
1. Attached hereto as Exhibit A is a true and complete copy of the Restated Articles of
Incorporation of the Company, certified as of by the Secretary of
State of the State of North Carolina. No further amendments or supplements to the Restated Articles
of Incorporation have been proposed to or approved by the Board of Directors or shareholders of the
Company.
2. Attached hereto as Exhibit B is a true, correct, and complete copy of the By-Laws of the
Company. Such By-Laws have been in effect at all times since .
3. Attached hereto as Exhibit C are true, correct and complete copies of certain resolutions
duly adopted by the Board of Directors of the Company on . Such
resolutions have not been amended or modified, are in full force and effect in the form adopted and
are the only resolutions adopted by the Board of Directors of the Company or a duly authorized
committee thereof relating to (i) the authorization of the Company’s Registration Statement on Form
S-3 (File No. 333 ), (the “Registration Statement”) filed with the
Securities and Exchange Commission (the “Commission”) for the registration of Company’s securities,
(ii) the execution and delivery of the Terms Agreement, dated (the
“Terms Agreement”), between the Company and (the “Underwriters”), and
(iii) all other actions relating to the foregoing. Such resolutions have not been amended,
rescinded or modified since their adoption (other than as expressly set forth in such resolutions)
and remain in full force and effect as of the date of this Certificate.
4. Each person who, as a director or officer of the Company or attorney-in-fact of such
director or officer, signed (i) the Registration Statement, (ii) the Terms Agreement, and (iii) any
document delivered prior hereto or on the date of this Certificate in connection with the execution
and filing of the Registration Statement, or the execution and delivery of the Terms Agreement, or
the transactions contemplated thereby, or the execution and delivery of the certificates
representing the Shares, was, at the time or the respective times of such execution and delivery of
such documents, and, in the case of the filing of the Registration Statement with the Commission,
duly elected or appointed, qualified and acting as such director or officer or duly appointed and
acting as such attorney-in-fact and the signatures of such persons appearing on such documents are
their genuine signatures or, in case of the certificates evidencing the Shares, the true facsimile
thereof.
5. The minute book records of the Company relating to proceedings of the Board of Directors of
the Company made available to , counsel for the
Underwriters, are true and correct and constitute all such records in the possession and control of
the Company through and including .
The persons named below are duly qualified, elected, and acting officers of the Company, have
been duly elected or appointed to the offices set forth opposite their respective names, have held
such offices at all times relevant to the preparation of the Registration Statement, and hold such
offices as of the date hereof. The signatures set forth below opposite the names of such persons
are the genuine signatures of such persons.
Name
|
Office | Signature | ||
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the Company as of the
___ day of , 20___.
| By: | ||||
| Name: | ||||
| Title: | ||||
I, , a Vice President of the Company, hereby certify that
is the duly qualified, elected, and acting
of the Company, has been duly elected or appointed
to such offices, has held such offices at all times relevant to the preparation of the Registration
Statement, holds such offices as of the date hereof, and that the signature set forth above is his
genuine signature.
IN
WITNESS WHEREOF, I have hereunto set my hand as of the ___ day of
, 20___.
| By: | ||||
| Name: | ||||
| Title: | Vice President | |||
Exhibit D
FORM OF OFFICERS’ CERTIFICATE
[Name , [title:] ,
and [name:] , [title:]
, of PepsiCo, Inc., a corporation organized under
the laws of the State of North Carolina (the “Company”), each hereby certifies as follows:
1. I have examined the Company’s Registration Statement on Form S-3 (File
No. 333- ) (the “Registration Statement”) filed by the Company with the
Securities and Exchange Commission (the “Commission”) on October ___, 2008, including all of the
documents filed as exhibits thereto. Capitalized terms used herein and not otherwise defined have
the meanings ascribed to such terms by the prospectus filed as part of the Registration Statement
(such prospectus hereinafter the “Prospectus”).
2. To my knowledge, no proceedings for the merger, consolidation, liquidation, or dissolution
of the Company or the sale of all or substantially all of its assets are pending or contemplated.
3. To my knowledge, the Registration Statement as supplemented by the Time of Sale Prospectus
(i) contains no untrue statement of a material fact regarding the Company or any of its
consolidated subsidiaries and (ii) does not omit to state any material fact necessary to make any
such statement, in the light of the circumstances under which it was made, not misleading.
IN
WITNESS WHEREOF, I have hereunto set my hand as of the ___ of ,
20___.
| By: | ||||
| Name: | ||||
| Title: | ||||