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MONSANTO COMPANY
$100,000,000
Medium-Term Notes, Series D
Distribution Agreement
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January ---, 1998
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.,
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇
& ▇▇▇▇▇ Incorporated,
▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
Dear Sirs:
Monsanto Company, a Delaware corporation (the "Company"),
proposes to issue and sell up to $100,000,000 aggregate principal amount of
its Medium-Term Notes, Series D (the "Securities"). Subject to the terms and
conditions stated herein, the Company hereby (i) appoints ▇▇▇▇▇▇▇, Sachs &
Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated and such additional
agents as the Company may appoint from time to time pursuant to paragraph
2(a) below (individually an "Agent" and collectively, the "Agents"), as
agents of the Company for the purpose of soliciting offers to purchase the
Securities from the Company and (ii) agrees that, except as otherwise
contemplated herein, whenever it determines to sell Securities directly to
any of the Agents as principal for resale to others, it will enter into a
separate agreement (each a "Terms Agreement"), substantially in the form of
Annex I hereto, relating to such sale in accordance with Section 2(b) hereof.
The terms and rights of the Securities shall be as specified in
or established pursuant to the Indenture, dated as of August 1, 1990 (the
"Indenture"), between the Company and The Chase Manhattan Bank (National
Association), as Trustee (herein called the "Trustee", which term includes
any successor trustee under the Indenture) (the "Trustee"). The Securities
shall have the maturity ranges, annual interest rates, redemption provisions
and other terms set forth in the Prospectus referred to below as it may be
supplemented from time to time. The Securities will be issued, and the terms
thereof established, from time to time by the Company in accordance with the
Indenture and the Administrative Procedure attached hereto as Annex II and,
if applicable, will be specified in a related Terms Agreement.
1. The Company represents and warrants to, and agrees
with, the Agents that:
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(a) A registration statement on Form S-3 (File No.
33-60189) in respect of the Securities has been filed with the Securities and
Exchange Commission (the "Commission") in the form heretofore delivered or to
be delivered to the Agents and such registration statement in such form has
been declared effective by the Commission and no stop order suspending the
effectiveness of such registration statement has been issued and no
proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in such registration
statement being hereinafter called a "Preliminary Prospectus"; the various
parts of such registration statement, including all exhibits thereto but
excluding Form T-1 and, if applicable, including the information contained in
the form of final prospectus filed with the Commission pursuant to Rule
424(b) under the Securities Act of 1933, as amended (the "Act"), in
accordance with Section 4(a) hereof and deemed by virtue of Rule 430A under
the Act to be part of the registration statement, each as amended at the time
such part became effective, being hereinafter collectively called the
"Registration Statement"; the prospectus (including, if applicable, any
prospectus supplement) relating to the Securities, in the form in which it
has most recently been filed with the Commission on or prior to the date of
this Agreement, being hereinafter called the "Prospectus"; any reference
herein to any Preliminary Prospectus or the Prospectus shall be deemed to
refer to and include the documents incorporated by reference therein pursuant
to the applicable form under the Act, as of the date of such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any amendment
or supplement to any Preliminary Prospectus or the Prospectus, including any
supplement to the Prospectus that sets forth only the interest rate per annum
borne by the Securities offered (a "Pricing Supplement"), shall be deemed to
refer to and include any documents filed after the date of such Preliminary
Prospectus or Prospectus, as the case may be, under the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and incorporated therein by
reference; and any reference to the Prospectus as amended or supplemented
shall be deemed to refer to and include the Prospectus as amended or
supplemented (including by the applicable Pricing Supplement filed in
accordance with Section 4 (a) hereof) in relation to Securities sold pursuant
to this Agreement, in the form filed with the Commission pursuant to Rule
424(b) under the Act and in accordance with Section 4(a) hereof, including
any documents incorporated by reference therein as of the date of such
filing);
(b) The documents incorporated by reference in the
Prospectus, when they became effective or were filed with the Commission, as
the case may be, conformed in all material respects to the requirements of
the Act or the Exchange Act, as applicable, and the rules and regulations of
the Commission thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact required to
be stated therein or necessary to make the statements therein not misleading;
and any further documents so filed and incorporated by reference in the
Prospectus, or any amendment or supplement thereto, when such documents
become effective or are filed with the Commission, as the case may be, will
conform in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the Commission
thereunder and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with
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information furnished in writing to the Company by the Agents expressly for use
in the Prospectus as amended or supplemented to relate to a particular issuance
of Securities;
(c) The Registration Statement and the Prospectus conform,
and any amendments or supplements thereto will conform, in all material
respects to the requirements of the Act and the Trust Indenture Act of 1939,
as amended (the "Trust Indenture Act") and the rules and regulations of the
Commission thereunder and do not and will not, as of the applicable effective
date as to the Registration Statement and any amendment thereto and as of the
applicable filing date as to the Prospectus and any amendment or supplement
thereto, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in writing
to the Company by an Agent expressly for use in the Prospectus as amended or
supplemented to relate to a particular issuance of Securities;
(d) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not been
any material change in the capital stock (other than changes in treasury
stock within limits, or pursuant to employee plans, disclosed or incorporated
by reference in the Prospectus) or long-term debt (other than the
reclassification of certain commercial paper to long-term debt and the
issuance of $200,000,000 of 30 year debentures) of the Company and its
subsidiaries considered as a whole or any material adverse change, or any
development known to the Company involving a prospective material adverse
change, in or affecting the financial position, shareowners' equity or
results of operations of the Company and its subsidiaries considered as a
whole, otherwise than as set forth or contemplated in the Prospectus;
(e) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware, with power and authority to own its properties and conduct its
business as described in the Prospectus, and has been duly qualified as a
foreign corporation for the transaction of business and is in good standing
under the laws of each other state of the United States except Rhode Island;
and each of ▇. ▇. ▇▇▇▇▇▇ & Co. (Delaware), Monsanto International Sales
Company, Inc. (Virgin Islands), Monsanto p.l.c. (United Kingdom) and N.V.
Monsanto Europe S.A. (Belgium) (such corporations being referred to herein as
"Principal Subsidiaries") is a corporation duly incorporated and validly
existing in good standing under the laws of its jurisdiction of incorporation
as set forth above;
(f) The Company has an authorized capitalization as set
forth in the Prospectus, and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued and are fully paid
and non-assessable; and all of the issued equity securities of each Principal
Subsidiary of the Company have been duly and validly authorized and issued,
are fully paid and non-assessable and (except for shares necessary to qualify
directors or to maintain any minimum number of shareholders required by law)
are owned directly or indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims;
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(g) The Securities have been duly authorized, and, when
issued and delivered pursuant to this Agreement and any Terms Agreement, and
authenticated pursuant to the Indenture, such Securities will have been duly
executed, authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Company entitled to the benefits provided by
the Indenture; the Indenture has been duly authorized by the Company and, has
been duly qualified under the Trust Indenture Act and constitutes a valid and
legally binding instrument of the Company, enforceable in accordance with its
terms, except as the same may be limited by bankruptcy, insolvency,
reorganization or other laws relating to or affecting the enforcement of
creditors' rights; and the Indenture conforms and the Securities will conform
to the descriptions thereof contained in the Prospectus as amended or
supplemented with respect to such Securities;
(h) The issue and sale of the Securities and the compliance
by the Company with all of the provisions of the Securities, the Indenture,
this Agreement and any Terms Agreement, and the consummation of the
transactions herein and therein contemplated will not conflict with or result
in a breach or violation of any of the terms or provisions of, or constitute
a default under, or result in the creation or imposition of any lien, charge
or encumbrance upon any of the property or assets of the Company or any of
its Principal Subsidiaries pursuant to the terms of, any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which the
Company or any of its Principal Subsidiaries is a party or by which the
Company or any of its Principal Subsidiaries is bound or to which any of the
property or assets of the Company or any of its Principal Subsidiaries is
subject, which would cause a current or prospective material adverse change
in or affecting the financial position, shareowners' equity or results of
operations of the Company and its subsidiaries considered as a whole or
affect the validity of the Securities or the legal authority of the Company
to comply with the Securities, the Indenture, this Agreement or any Terms
Agreement; nor will such action result in any violation of the provisions of
the Certificate of Incorporation, as amended, or the By-Laws of the Company
or in a violation of any statute or any order, rule or regulation of any
court or governmental agency or body in the United States having jurisdiction
over the Company or any of its Principal Subsidiaries or any of their
properties which would cause a current or prospective material adverse change
in or affecting the financial position, shareowners' equity or results of
operations of the Company and its subsidiaries considered as a whole or
affect the validity of the Securities or the legal authority of the Company
to comply with the Securities, the Indenture, this Agreement or any Terms
Agreement (except to the extent that the sale of the Securities as
contemplated by this Agreement and the distribution of the Securities by the
Agents may result in violations of state securities or Blue Sky laws); and no
consent, approval, authorization, order, registration or qualification of or
with any court or any such regulatory authority or other governmental agency
or body in the United States having jurisdiction over the Company is required
for the solicitation of offers to purchase Securities and the issue and sale
of the Securities or the consummation by the Company of the other
transactions contemplated by this Agreement, any Terms Agreement or the
Indenture, except such as have been, or will have been prior to the Closing
Date (as defined in Section 3 hereof), obtained under the Act and the Trust
Indenture Act and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws in
connection with the solicitation by the Agents of offers to purchase the
Securities from the Company, the Company's sale of Securities, purchases of
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the Securities by the Agents as principal, and resale by the Agents of such
Securities, as the case may be, both in the manner contemplated hereby; and
(i) There are no legal or governmental proceedings pending
to which the Company or any of its subsidiaries is a Party or of which any
property of the Company or any of its subsidiaries is the subject, other than
as set forth in the Prospectus and other than those which in the aggregate
will not have a material adverse effect on the Company and its subsidiaries
considered as a whole; and, to the best of the Company's knowledge, no such
proceedings are contemplated by governmental authorities.
2. (a) On the basis of the representations and
warranties, and subject to the terms and conditions, herein set forth, the
Agents severally and not jointly agree, as agents of the Company, to use
their reasonable best efforts to solicit offers to purchase the Securities from
the Company upon the terms and conditions set forth in the Prospectus as
amended or supplemented from time to time. The Company agrees that the
Agents are separately authorized to solicit offers to purchase the
Securities. The Company reserves the right to appoint additional Agents for
the purpose of soliciting offers to purchase Securities from the Company
subject to the terms and conditions stated herein by having any such
additional Agent execute and deliver a counterpart to this Agreement upon
appointing an additional Agent. The Company will promptly notify the
existing Agents of the addition of an Agent. The name of such additional
Agent will thereafter be included in each Pricing Supplement applicable to
such Agent or, after consultation with the existing Agents, the Company may
amend or supplement the Prospectus Supplement to include such additional
Agent.
The Company reserves the right, in its sole discretion, to
instruct the Agents to suspend at any time, for any period of time or
permanently, the solicitation of offers to purchase the Securities. Upon
receipt of instructions from the Company, the Agents will forthwith suspend
solicitation of offers to purchase Securities from the Company until such
time as the Company has advised them that such solicitation may be resumed.
The Company agrees to pay each Agent a commission, at the time of
settlement of each sale of a Security by the Company as a result of a
solicitation made by such Agent, in an amount equal to the percentage of the
principal amount of such Security sold indicated in Schedule I hereto.
As Agents, each of you is authorized to solicit offers to
purchase the Securities only in denominations of $1,000 or any integral multiple
thereof at a purchase price equal to 100% of their principal amount unless
otherwise agreed to by the Company and the Agents or, in the case of
Securities denominated in a currency or composite currency other than U.S.
dollars ("Specified Currency"), in denominations of the amount of the
Specified Currency for such Securities, at the noon buying rate in The City
of New York for cable transfers for such Specified Currency on the first
Business Day (as defined in the Indenture) in The City of New York and the
country issuing such currency (or, in the case of European Currency Units,
Brussels) next preceding the date on which the Company accepts offers to
purchase such Securities, equivalent to U.S. $1,000 (rounded down to an
integral multiple of 1,000 units of such Specified Currency) and any greater
amount that is an integral multiple of such Specified Currency. Each Agent
shall
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communicate to the Company, orally or in writing, each offer to purchase
Securities other than those rejected by the Agents. The Company shall have the
sole right to accept offers to purchase Securities and may reject any proposed
purchase of Securities as a whole or in part. The Agents shall have the right,
in their discretion reasonably exercised, to reject any offer received by them
to purchase Securities, as a whole or in part, and any such rejection by the
Agents shall not be deemed a breach of their agreements contained herein.
(b) Each sale of Securities to any Agent as principal shall
be made in accordance with the terms of this Agreement and (unless the
Company and such Agent shall otherwise agree) a Terms Agreement which will
provide for the sale of such Securities to, and the purchase thereof by, such
Agent. A Terms Agreement may also specify certain provisions relating to the
reoffering of such Securities by such Agent. Any Agent's commitment to
purchase Securities as principal, whether pursuant to any Terms Agreement or
otherwise shall be deemed to have been made on the basis of the
representations and warranties of the Company herein contained and shall be
subject to the terms and conditions herein set forth. Each Terms Agreement
shall include a specification of the principal amount of Securities to be
purchased by the Agent pursuant thereto, the price to be paid to the Company
for such Securities, any provisions relating to rights of, and default by,
underwriters acting together with the Agent in the reoffering of the
Securities, and the time and place of delivery of and payment for such
Securities. Such Terms Agreement shall also specify any requirements for
officers' certificates, opinions of counsel and accountants' letters pursuant
to Section 4 hereof.
For each sale of Securities to an Agent as principal that is not
made pursuant to a Terms Agreement, the procedural details relating to the
issue and delivery of such Securities and payment therefor shall be as set
forth in the Administrative Procedure attached hereto as Annex II (the
"Procedure"). For each such sale of Securities to an Agent as principal that
is not made pursuant to a Terms Agreement, the Company agrees to pay such
Agent a commission (or grant an equivalent discount) as provided in Section
2(a) hereof and in accordance with the schedule set forth therein.
Each time and date of delivery of and payment for Securities to
be purchased by an Agent as principal, whether set forth in a Terms Agreement or
in accordance with the Procedure, is referred to herein as a "Time of
Delivery".
(c) Procedural details relating to the issue and delivery
of Securities, the solicitation of offers to purchase Securities, and the
payment in each case therefor, are set forth in the Procedure. The
provisions of the Procedure shall apply to all transactions contemplated
hereunder other than those made pursuant to a Terms Agreement. Each of the
Agents and the Company agrees to perform the respective duties and
obligations specifically provided to be performed by each of them in the
Procedure as it may be amended from time to time. The Procedure may only be
amended by written agreement among the Company and the Agents.
3. The documents required to be delivered pursuant to
Section 6 hereof shall be delivered at the offices of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇,
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ at 11:00 a.m., New York City time, on
the date of this Agreement, which date and time of such delivery may be
postponed by agreement between the Agents and the
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Company but in no event shall be later than the date on which solicitation of
offers to purchase Securities is commenced or Securities are first sold
hereunder, such time and date of delivery being herein called the "Closing
Date."
4. The Company covenants and agrees with the Agents:
(a) (i) To make no further amendment or any supplement to
the Registration Statement or the Prospectus as amended or supplemented prior
to the Closing Date which shall be reasonably disapproved by the Agents
promptly after reasonable notice thereof, or after the date of any Terms
Agreement or other agreement by an Agent to purchase Securities as principal
and prior to the related Time of Delivery which shall be reasonably
disapproved by such Agent promptly after reasonable notice thereof; (ii) to
make no such amendment or supplement, other than a Pricing Supplement at any
other time prior to having afforded each Agent a reasonable opportunity to
review it; (iii) to prepare, with respect to any Securities to be offered
through or to any Agent pursuant to this Agreement, a Pricing Supplement with
respect to such Securities in a form previously approved by such Agent and to
file such Pricing Supplement pursuant to Rule 424(b)(3) under the Act not
later than the close of business of the Commission on the fifth business day
after the date on which such Pricing Supplement is first used; (iv) to file
promptly all reports and any definitive proxy or information statements
required to be filed by the Company with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the delivery of
a prospectus is required in connection with the offering or sale of the
Securities, and during such same period to advise each Agent, promptly after
it receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or become effective or any supplement
to the Prospectus or any amended Prospectus has been filed with the
Commission, of the issuance by the Commission of any stop order or of any
order preventing or suspending the use of any prospectus relating to the
Securities, of the suspension of the qualification of the Securities for
offering or sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the Commission for the
amending or supplementing of the Registration Statement or Prospectus or for
additional information; (v) in the event of the issuance of any such stop
order or of any such order preventing or suspending the use of any prospectus
relating to the Securities or suspending any such qualification, to use
promptly its best efforts to obtain its withdrawal; and (vi) to promptly
notify the Agents of any downgrading of its debt securities.
(b) Promptly from time to time to take such action as the
Agents reasonably may request to qualify the Securities for offering and sale
under the securities laws of such United States jurisdictions as they may
request and to comply with such laws so as to permit the continuance of sales
and dealings therein in such jurisdictions for as long as may be necessary to
complete the distribution or sale of the Securities; provided, however, that
in connection therewith the Company shall not be required to qualify as a
foreign corporation or to file a general consent to service of process in any
jurisdiction or to subject itself to taxation for doing business in any
jurisdiction; and provided, further, that the expense of maintaining any such
qualification more than one year from the date of any Terms Agreement
relating to such Securities shall be at the expense of the Agents for such
Securities;
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(c) To furnish each Agent with copies of the Registration
Statement and each amendment thereto, and with copies of the Prospectus as
each time amended or supplemented in the form in which it is filed with the
Commission pursuant to Rule 424 under the Act, both in such quantities as the
Agents may reasonably request from time to time, provided, however, that
Pricing Supplements only need be provided to the Agent who solicits or
purchases the Securities; and, if the delivery of a prospectus is required at
any time in connection with the offering or sale of the Securities (including
Securities purchased from the Company by any Agent as principal) and if at
such time any event shall have occurred as a result of which the Prospectus
as then amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made when such Prospectus is delivered, not misleading, or, if for any
other reason it shall be necessary to amend or supplement the Prospectus or
to file under the Exchange Act any document incorporated by reference in the
Prospectus in order to comply with the Act, the Exchange Act or the Trust
Indenture Act, to notify each Agent and request the Agents to suspend
solicitation of offers to purchase Securities from the Company, in their
capacity as agents of the Company and, if so notified, each Agent shall
forthwith cease such solicitations; and if the Company shall decide to amend
or supplement the Registration Statement or the Prospectus as then amended or
supplemented, to so advise each Agent promptly by telephone (with
confirmation in writing) and to prepare and cause to be filed promptly with
the Commission an amendment or supplement to the Registration Statement or
the Prospectus as then amended or supplemented that will correct such
statement or omission or effect such compliance; provided, however, that if
prior to the expiration of nine months after the date of a Terms Agreement
relating to the Securities any Agent continues to own Securities purchased
from the Company by such Agent as principal or such Agent is otherwise
required to deliver a prospectus in respect of transactions in the
Securities, the Company shall promptly prepare and file with the Commission
such an amendment or supplement;
(d) To make generally available to its security holders as
soon as practicable, but in any event not later than eighteen months after
(i) the effective date of the Registration Statement, (ii) the effective date
of each post-effective amendment to the Registration Statement, and (iii) the
date of each filing by the Company with the Commission of an Annual Report on
Form 10-K that is incorporated by reference in the Registration Statement, an
earning statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and
regulations of the Commission thereunder (including, at the option of the
Company, Rule 158);
(e) During the period when this Agreement is in effect, to
furnish to each Agent copies of all reports or other communications
(financial or other) furnished to stockholders, and deliver to each Agent (i)
as soon as they are available, copies of any reports and financial statements
furnished to or filed with the Commission or any national securities exchange
on which any class of securities of the Company is listed; and (ii) such
additional information concerning the business and financial condition of the
Company as such Agent may from time to time reasonably request (such financial
statements to be on a consolidated basis to the extent the accounts of the
Company and its subsidiaries are consolidated in reports furnished to its
stockholders generally or to the Commission);
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(f) That, except as modified by any Terms Agreement, from
the date of any Terms Agreement with any Agent or other agreement by such
Agent to purchase securities as principal and continuing to and including the
earlier of (i) the termination of the trading restrictions for the Securities
purchased thereunder, as notified to the Company by such Agent and (ii) the
related Time of Delivery, the Company will not, without the prior written
consent of such Agent, offer, sell, contract to sell or otherwise dispose of
in the United States any debt securities of the Company which mature more
than nine months after such Time of Delivery and which are substantially
similar to such Securities;
(g) That each acceptance by the Company of an offer to
purchase Securities hereunder (including any purchase by such Agent as
principal not pursuant to a Terms Agreement), and each sale of Securities to
the Agents pursuant to a Terms Agreement, shall be deemed to be an
affirmation to such Agents that the representations and warranties of the
Company contained in or made pursuant to this Agreement are true and correct
in all material respects as of the date of such acceptance or of such Terms
Agreement as though made at and as of such time, and an undertaking that such
representations and warranties will be true and correct in all material
respects as of the settlement date for the Securities relating to such
acceptance and as of the Time of Delivery relating to such sale, as though
made at and as of each such date (except that such representations and
warranties shall be deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented relating to such Securities);
(h) That each time the Registration Statement or the
Prospectus shall be amended or supplemented (other than by a Pricing
Supplement), each time a document filed under the Act or the Exchange Act is
incorporated by reference into the Prospectus, and each time, if so indicated
in the applicable Terms Agreement, the Company sells Securities to the Agents
as principal pursuant to a Terms Agreement, the Company shall furnish or
cause to be furnished forthwith to each Agent a certificate of officers of
the Company satisfactory to the Agents, dated the date of such supplement,
amendment, incorporation or Time of Delivery related to such sale, in form
reasonably satisfactory to the Agents to the effect that the statements
contained in the certificate referred to in Section 6(f) hereof which was
last furnished to the Agents are true and correct in all material respects at
such date, as though made at and as of such date (except that such statements
shall be deemed to relate to the Registration Statement and the Prospectus
and any amendment or supplement thereto filed at or prior to such time) or,
in lieu of such certificate, certificates of the same tenor as the
certificates referred to in said Section 6(f) but modified to relate to the
Registration Statement and the Prospectus and any amendment or supplement
thereto filed at or prior to such date;
(i) That each time the Registration Statement or the
Prospectus shall be amended or supplemented (other than by a Pricing
Supplement), each time a document filed under the Act or the Exchange Act is
incorporated by reference into the Prospectus, and each time, if so indicated
in the applicable Terms Agreement, the Company sells Securities to the Agents
as principal pursuant to a Terms Agreement, the Company shall furnish or
cause to be furnished forthwith to each Agent a written opinion of counsel
for the Company, or other counsel reasonably satisfactory to the Agents,
dated the date of such amendment, supplement, incorporation or Time of
Delivery relating to such sale, in form
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reasonably satisfactory to the Agents to the effect that the Agents may rely on
the opinion referred to in Section 6(c) hereof which was last furnished to them
to the same extent as though it were dated the date of such letter authorizing
reliance (except that statements in such last opinion shall be deemed to relate
to the Registration Statement and the Prospectus and any amendment or supplement
thereto filed at or prior to such date) or, in lieu of such opinion, an opinion
of the same tenor as the opinion referred to in Section 6(c) hereof but modified
to relate to the Registration Statement and the Prospectus and any amendment or
supplement thereto filed at or prior to such date;
(j) That each time the Registration Statement or the
Prospectus shall be amended or supplemented (other than by a Pricing
Supplement), each time a document filed under the Act or the Exchange Act is
incorporated by reference into the Prospectus, and each time, if the
applicable Terms Agreement specifies the delivery of an opinion or opinions
by ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel to the Agents, as a condition to the purchase
of Securities pursuant to such Terms Agreement, the Company shall furnish to
such counsel such papers and information as they may reasonably request to
enable them to furnish to such agent the opinion or opinions referred to in
Section 6(b) hereof;
(k) That each time the Registration Statement or the
Prospectus shall be amended or supplemented (other than by a Pricing
Supplement) and each time that a document filed under the Act or the Exchange
Act is incorporated by reference into the Prospectus, in either case to set
forth financial information included in or derived from the Company's
consolidated financial statements, or, if so indicated in the applicable
Terms Agreement, each time the Company sells Securities to the Agents as
principal pursuant to a Terms Agreement, the Company shall cause its
independent public accountants forthwith to furnish each Agent a letter,
dated the date of such amendment, supplement, incorporation or Time of
Delivery relating to such sale, in form reasonably satisfactory to the
Agents, of the same tenor as the letter referred to in Section 6(d) hereof
but modified to relate to the Registration Statement and the Prospectus as
amended or supplemented to the date of such letter, with such changes as may
be necessary to reflect changes in the financial statements and other
information derived from the accounting records of the Company, to the extent
such financial statements and other information are available as of a date
not more than five business days prior to the date of such letter; provided,
however, that where such amendment, supplement or document incorporated by
reference only sets forth unaudited quarterly financial information, the
scope of such letter may be limited to relate to such unaudited financial
information unless any other accounting or financial information included or
incorporated by reference therein is of a character that, in your reasonable
judgment, such letter should address such other information; and
(l) To permit to any person who has agreed to purchase
Securities as the result of an offer to purchase solicited by any Agent the
right to refuse to purchase and pay for such Securities if, on the related
settlement date fixed pursuant to the Procedure, any condition set forth in
Section 6(a), 6(e) or 6(g) hereof shall not have been satisfied (it being
understood that the judgment of such person with respect to the
impracticability or inadvisability of such purchase of Securities shall be
substituted, for purposes of this Section 4(l), for the respective judgments
of an Agent with respect to certain matters referred to in such Sections
6(a), 6(e) and 6(g), and that such Agent shall have no duty or
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obligation whatsoever to exercise the judgment permitted under such Sections
6(a), 6(e) and 6(g) on behalf of any such person).
5. The Company covenants and agrees with the Agents that
the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Securities under the Act and all
other expenses in connection with the preparation, printing and filing of the
Registration Statement, any Preliminary Prospectus and the Prospectus and
(except as otherwise expressly provided in Section 4(c) hereof) amendments
and supplements thereto and the mailing and delivering of copies thereof to
the Agents; (ii) the fees and expenses of the Agents' counsel in connection
with the transactions contemplated hereunder; (iii) the cost of printing,
preparing by word processor or reproducing this Agreement, any Terms
Agreement, any Indenture, any Blue Sky and Legal Investment Memoranda and any
other documents in connection with the offering, purchase, sale and delivery
of the Securities; (iv) all expenses in connection with the qualification of
the Securities for offering and sale under state securities laws as provided
in Section 4(b) hereof, including fees and disbursements of the Agents'
counsel in connection with such qualification and in connection with the Blue
Sky and legal investment surveys; (v) any fees charged by security rating
services for rating the Securities; (vi) any filing fees incident to any
required review by the National Association of Securities Dealers, Inc. of
the terms of the sale of the Securities; (vii) the cost of preparing the
Securities; (viii) the fees and expenses of any Trustee and any agent of any
Trustee and the fees and disbursements of counsel for any Trustee in
connection with any Indenture and the Securities; (ix) any advertising
expenses in connection with the solicitation of offers to purchase and the
sale of Securities, so long as such advertising expenses have been approved
by the Company; and (x) all other costs and expenses incident to the
performance of its obligations hereunder which are not otherwise specifically
provided for in this Section. It is understood, however, that, except as
provided in this Section, Section 7, Section 8 and Section 10 hereof, the
Agents will pay all of their own costs and expenses, including transfer taxes
on resale of any of the Securities by them.
6. The Agents' obligations as agents of the Company to
solicit offers to purchase the Securities and their obligations to purchase
Securities as principal, pursuant to any Terms Agreement or otherwise, shall
be subject, in the discretion of the Agents, to the condition that all
representations and warranties and other statements of the Company herein
(and, in the case of an obligation of an Agent under a Terms Agreement, in or
incorporated by reference in such Terms Agreement) are true and correct in
all material respects at and as of the Closing Date, the date of each such
solicitation, any settlement date related to the acceptance of such an offer,
and each Time of Delivery, the condition that the Company shall have
performed in all material respects all of its obligations hereunder
theretofore in each case to be performed and the following additional
conditions (it being understood that any judgment to be made by the Agents
under this Section 6 shall be made by each Agent individually):
(a) (i) The Prospectus as amended or supplemented
(including the Pricing Supplement) with respect to the applicable Securities
shall have been filed with the Commission pursuant to Rule 424(b) under the
Act within the applicable time period prescribed for such filing by the rules
and regulations under the Act and in accordance with
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Section 4(a) hereof; (ii) no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and (iii) all requests for additional information on the part of the
Commission shall have been complied with to the Agents' reasonable satisfaction;
(b) ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Agents, shall have
furnished to them (i) such opinion or opinions, dated the Closing Date, with
respect to the incorporation of the Company, the validity of the Indenture,
the Securities, the Registration Statement, the Prospectus as amended or
supplemented and other related matters as they may reasonably request, and
(ii) if and to the extent requested by such Agent, with respect to each
applicable date referred to in Section 4(j) hereof, as the case may be, an
opinion or opinions, dated such applicable date, to the effect that the
Agents may rely on the opinion or opinions which were last furnished to them
pursuant to this Section 6(b) to the same extent as though it or they were
dated the date of such letter authorizing reliance (except that the
statements in such last opinion or opinions shall be deemed to relate to the
Registration Statement and the Prospectus amendment or supplement thereto
filed at or prior to such date) or, in any case, in lieu of such an opinion
or opinions, an opinion or opinions of the same tenor as the opinion or
opinions referred to in clause (i) but modified to relate to the Registration
Statement and the Prospectus and any amendment or supplement thereto filed at
or prior to such date; and in each case such counsel shall have received such
papers and information as the Agents may reasonably request to enable them to
pass upon such matters;
(c) ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Associate General Counsel for the
Company, or other counsel satisfactory to the Agents, shall have furnished to
the Agents his written opinion, dated the Closing Date or any applicable date
referred to in Section 4(i), as the case may be, in form and substance
satisfactory to the Agents, to the effect that:
(i) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with corporate power and authority to own its properties
and conduct its business as described in the Prospectus as amended or
supplemented, and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of
each other state of the United States except Rhode Island;
(ii) The Company has an authorized capitalization as set
forth in the Prospectus as amended or supplemented and all of the
issued shares of capital stock of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable;
(iii) To the best of such counsel's knowledge, there are no
legal or governmental proceedings pending to which the Company or any
of its subsidiaries is a party or of which any property of the Company or
any of its subsidiaries is the subject, other than as set forth in the
Prospectus and other than those which in the aggregate will not have a
material adverse effect on the Company and its subsidiaries considered
as a whole;
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(iv) This Agreement (and any applicable Terms Agreement) has
been duly authorized, executed and delivered by the Company;
(v) The Securities have been duly authorized by the
Company, and, when the signatures (which may be by facsimile) of
officers (specified in such opinion) of the Company and the seal of the
Company (which may be by facsimile) have been imprinted on the
Securities and the Securities have been duly authenticated by the
Trustee under the Indenture (which assumptions such counsel need not
verify by an inspection of the Securities), the Securities will have
been duly executed, issued and delivered by the Company, and will
constitute valid and legally binding obligations of the Company
entitled to the benefits provided by the Indenture; and the Indenture
conforms and the Securities will conform to the descriptions thereof in
the Prospectus as amended or supplemented;
(vi) The Indenture has been duly authorized, executed and
delivered by the Company and constitutes a valid and legally binding
instrument of the Company, enforceable in accordance with its terms
except as the same may be limited by bankruptcy, insolvency,
reorganization or other laws relating to or affecting the enforcement
of creditors' rights; and the Indenture has been duly qualified under the
Trust Indenture Act; and no taxes or recording fees under Delaware,
Missouri or Federal law are required to be paid with respect to the
execution of the Indenture and the issuance of the Securities;
(vii) The issue and sale of the Securities and the compliance
by the Company with all of the provisions of the Securities, the
Indenture, this Agreement and any Terms Agreement, and the consummation
of the transactions herein and therein contemplated will not conflict
with or result in a breach of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of
any lien, charge or encumbrance upon any of the property or assets of
the Company or any of its Principal Subsidiaries pursuant to the terms
of, any indenture, mortgage, deed of trust, loan agreement or other
similar agreement or instrument known to such counsel, after such
reasonable investigation as he deems necessary, to which the Company or
any of its Principal Subsidiaries is a party or by which the Company or
any of its Principal Subsidiaries is bound or to which any of the
property or assets of the Company or any of its Principal Subsidiaries
is subject, which would cause a current or prospective material adverse
change in or affecting the financial position, shareowners' equity or
results of operations of the Company and its subsidiaries considered as
a whole or affect the validity of the Securities or the legal authority of
the Company to comply with the Securities, the Indenture, this Agreement
or any Terms Agreement, nor will such actions result in any violation of
the provisions of the Certificate of Incorporation, as amended, or the
By-Laws of the Company or in a violation of any statute or any order, rule
or regulation of any court or governmental agency or body in the United
States having jurisdiction over the Company or any of its Principal
Subsidiaries or any of their properties which would cause a current or
prospective material adverse change in or affecting the financial
position, shareowners' equity or results of operations of the Company and
its subsidiaries considered as a whole or affect the validity of the
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Securities or the legal authority of the Company to comply with the
Securities, the Indenture, this Agreement or any Terms Agreement (except
to the extent that the sale of the Securities as contemplated by this
Agreement and the Terms Agreement and the distribution of the Securities
by the Agents may result in violation of state securities or Blue Sky
laws);
(viii) No consent, approval, authorization, order,
registration or qualification of or with any court or any such
regulatory authority or other governmental body in the United States
having jurisdiction over the Company is required for the solicitation
of offers to purchase Securities and the issue and sale of the Securities
or the consummation by the Company of the other transactions
contemplated by this Agreement (and any applicable Terms Agreement) or
the Indenture, except such as have been obtained under the Act and the
Trust Indenture Act and such consents, approvals, authorizations,
registrations or qualifications as may be required under state
securities or Blue Sky laws in connection with the Agents' solicitation
of offers to purchase Securities, the Company's sale of Securities,
purchases of Securities by the Agents as principal, and resales by the
Agents of such Securities, as the case may be, both as contemplated by
this Agreement (and any applicable Terms Agreement);
(ix) The documents incorporated by reference in the
Prospectus as amended or supplemented (other than the financial
statements and related schedules therein, as to which such counsel need
express no opinion), when they became effective or were filed with the
Commission, as the case may be, complied as to form in all material
respects with the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder;
and he has no reason to believe that any of such documents, when they
became effective or were so filed, as the case may be, contained, in
the case of a registration statement which became effective under the Act,
an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading, and, in the case of other documents which were
filed under the Act or the Exchange Act with the Commission, an 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 when such documents were so
filed, not misleading; and
(x) The Registration Statement and the Prospectus as
amended or supplemented and any further amendments and supplements
thereto made by the Company prior to the date of such opinion (other
than the financial statements and other financial data contained or
incorporated by reference therein or omitted therefrom, as to which
such counsel need express no opinion) appear on their face to be
appropriately responsive in all material respects to the requirements
of the Act and the Trust Indenture Act and the rules and regulations
thereunder; and the information included in the Registration Statement
in response to Item 10 (insofar as it relates to him) of Form S-3 is to
the best of his knowledge an accurate statement of the matter therein
set forth and fairly presents the information called for with respect
to that matter by the Act and the rules and regulations thereunder.
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Such counsel may also state that he or she has not verified, and
is not passing upon and does not assume any responsibility for, the accuracy,
completeness or fairness of the statements contained in the Registration
Statement, the Prospectus or the Prospectus as amended or supplemented, other
than those mentioned in the last clause of subparagraph (v) above, but such
counsel shall confirm that he or she has, however, participated in reviews
and discussions in connection with the preparation of the Registration
Statement, the Prospectus and the Prospectus as amended or supplemented and
any further amendments and supplements thereto made by the Company prior to
the Closing Date; and that in the course of such reviews and discussions no
facts came to his or her attention which led him or her to believe that the
Registration Statement or the Prospectus on the effective date of the
Registration Statement, or the Prospectus as amended or supplemented on the
date of such amendment or supplement, or any amendment or supplement to the
Prospectus as amended or supplemented on the date of such further amendment
or supplement (in each case, apart from the financial statements and other
financial data contained or incorporated by reference therein or omitted
therefrom and from any written information furnished to the Company by any
Agent expressly for use in the prospectus as amended or supplemented or any
omission therefrom) contained any untrue statement of a material fact or
omitted to state any material fact required to be stated therein or necessary
to make the statements therein not misleading; and such counsel does not know
of any contracts or other documents of a character required to be filed as an
exhibit to the Registration Statement or required to be incorporated by
reference into the Prospectus as amended or supplemented or required to be
described in the Registration Statement or the Prospectus as amended or
supplemented which are not filed or incorporated by reference or described as
required.
In rendering the foregoing opinion, such counsel may rely upon
opinions of local counsel and tax counsel satisfactory in form and scope to
counsel for the Agents. In matters of New York law such counsel may rely
upon the opinion of ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ delivered pursuant to Section 6(b)
hereof.
(d) At 11:00 a.m., New York City time, on the Closing Date
or on any applicable date referred to in Section 4(k), as the case may be,
the independent accountants who have certified the financial statements of
the Company and its subsidiaries included or incorporated by reference in the
Registration Statement shall have furnished to each Agent a letter, dated the
Closing Date or such applicable date, in form and substance satisfactory to
the Agents, to the effect set forth in Annex III hereto;
(e) Since the respective dates as of which information is
given in the Prospectus as amended or supplemented there shall not have been
any material change in the capital stock (other than changes in treasury
stock within limits, or pursuant to employee plans, disclosed or incorporated
by reference in the Prospectus) or long-term debt (other than the
reclassification of certain commercial paper to long-term debt and the
issuance of $200,000,000 of 30 year debentures) of the Company or any of its
subsidiaries or any material change, or any development involving a
prospective material change, in or affecting the financial position,
shareowners' equity or results of operations of the Company and its
subsidiaries considered as a whole, otherwise than as set forth or
contemplated in the Prospectus as amended or supplemented, the effect of
which is in the reasonable judgment of the Agents so material and adverse as
to make it impracticable or
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inadvisable to proceed with the public offering or the delivery of the
Designated Securities on the terms and in the manner contemplated in the
Prospectus as amended or supplemented.
(f) The Company shall have furnished or caused to be
furnished to each Agent a certificate of officers of the Company satisfactory
to the Agents, dated the Closing Date or any applicable date referred to in
Section 4(h), as the case may be, as to the accuracy in all material respects
of the representations and warranties of the Company herein at and as of the
Closing Date or such applicable date, as to the performance by the Company in
all material respects of all of its obligations hereunder to be performed at
or prior to the Closing Date or such applicable date and as to the matters
set forth in subsection (a) of this Section 6; and
(g) During the period in which the Agents are soliciting
offers to purchase Securities, including the period between the date of any
Terms Agreement (or other agreement by an Agent to purchase Securities as
principal) and the related Time of Delivery, there shall not have occurred
any of the following events, the effect of which in each case, in the
reasonable judgment of the Agents, is such as to make it impracticable for
the Agents to solicit offers to purchase the Securities, purchase Securities
as principal or enforce contracts for the sale of the Securities: (i) any
outbreak or escalation of hostilities or other national or international
calamity or crisis which affects the financial markets of the United States,
(ii) a declaration of a banking moratorium by either Federal or New York
State authorities, (iii) a suspension or halt in trading on the New York
Stock Exchange in any securities of the Company which adversely affects the
marketing of the Securities, (iv) a suspension or limitation in trading in
securities generally on the New York Stock Exchange or the establishment of
minimum prices on such Exchange or (v) any downgrading in the rating accorded
the Company's debt securities by any one of the following statistical rating
organizations: Standard & Poor's Corporation, ▇▇▇▇▇'▇ Investors Service,
Inc. and Duff & ▇▇▇▇▇▇.
(h) With respect to any Security denominated in a currency
other than the U.S. dollar, more than one currency or a composite currency or
any Security the principal or interest of which is indexed to such currency,
currencies or composite currency, there shall not have occurred a suspension
or material limitation in foreign exchange trading in such currency,
currencies or composite currency by a major international bank, a general
moratorium on commercial banking activities in the country or countries
issuing such currency, currencies or composite currency, the outbreak or
escalation of hostilities involving the occurrence of any material adverse
change in the existing financial, political or economic conditions of, or the
declaration of war or a national emergency by, the country or countries
issuing such currency, currencies or composite currency or the imposition or
proposal of exchange controls by any governmental authority in the country or
countries issuing such currency, currencies or composite currency.
7. (a) The Company agrees to indemnify and hold harmless
each Agent against any losses, claims, damages or liabilities, joint or
several, to which such Agent may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue
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statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus, the Prospectus as amended or supplemented, or any
other prospectus relating to the Securities, or any amendment or supplement
thereto, or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary
to make the statements therein not misleading, and will reimburse each Agent
for any legal or other expenses reasonably incurred by such Agent in
connection with investigating or defending any such action or claim;
provided, however, that the Company shall not be liable in any such case to
the extent that any such loss, claim, damage or liability arises out of or is
based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus,, the
Prospectus as amended or supplemented or any other prospectus relating to the
Securities, or any such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Company by such Agent
expressly for use therein; provided, however, that if any Preliminary
Prospectus, any preliminary prospectus supplement relating to the Securities,
the Prospectus, the Prospectus as amended or supplemented, or any other
prospectus relating to the Securities contained any alleged untrue statement
or allegedly omitted to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading (excluding
in each case documents incorporated by reference) and such statement or
omission shall have been corrected in a revised Preliminary Prospectus,
preliminary prospectus supplement relating to the Securities, the Prospectus,
the Prospectus as amended or supplemented, or any other prospectus relating to
the Securities, or any amendment or supplement thereto relating to the
Securities, the Company shall not be liable to any Agent under this subsection
(a) with respect to such alleged untrue statement or alleged omission to the
extent that any such loss, claim, damage or liability of such Agent results
from the fact that such Agent sold Securities to a person to whom there was not
sent or given, at or prior to the written confirmation of such sale, a copy of
a revised Preliminary Prospectus, preliminary prospectus supplement relating to
the Securities, the Prospectus, the Prospectus as amended or supplemented, or
any other prospectus relating to the Securities, or any amendment or supplement
thereto relating to the Securities, as the case may be (excluding in each case
documents incorporated by reference), containing a correction of such alleged
misstatement or omission, if the Company has made available copies thereof to
such Agent prior to the confirmation of such sale; and provided, further, that
the Company shall not be liable to any Agent under this subsection (a) to the
extent that any such loss, claim, damage or liability of such Agent results
from the use by such Agent of the Prospectus as amended or supplemented or
the Prospectus as amended or supplemented as it may be further amended or
supplemented, as the case may be (excluding in each case documents
incorporated by reference), (i) otherwise than in connection with an offer or
sale of the Securities or (ii) at any time nine months or more after the time
of issue of the Prospectus as amended or supplemented unless the Company has
prior to such use amended or supplemented the Prospectus as amended or
supplemented to comply with Section 10(a)(3) of the Act if required pursuant
to Section 4(c) hereof and such Agent uses the Prospectus as amended or
supplemented as so further amended or supplemented.
Each Agent acknowledges that the indemnity agreement in this
subsection (a) does not extend to any liability which such Agent might have
under Section 5(b) of the Act by reason of the fact that such Agent sold
Securities to a person to whom there was not
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sent or given, at or prior to the written confirmation of such sale, a copy of
the Prospectus, the Prospectus as amended or supplemented, any other prospectus
relating to the Securities or any amendment or supplement relating thereto, as
the case may be (excluding in each case documents incorporated by reference), if
the Company has made available copies thereof to such Agent.
(b) Each Agent agrees to indemnify and hold harmless the
Company against any losses, claims, damages or liabilities to which the
Company may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus, the
Prospectus as amended or supplemented or any other prospectus relating to the
Securities, or any amendment or Supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged omission
was made in any Preliminary Prospectus, any preliminary prospectus
supplement, the Registration Statement, the Prospectus, the Prospectus as
amended or supplemented or any other prospectus relating to the Securities,
or any such amendment or supplement, in reliance upon and in conformity with
written information furnished to the Company by such Agent expressly for use
therein; and will reimburse the Company for any legal or other expenses
reasonably incurred by the Company in connection with investigating or
defending any such action or claim.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under such subsection, notify the indemnifying party
in writing of the commencement thereof; and in the event that such
indemnified party shall not so notify the indemnifying party within 30 days
following receipt of any such notice by such indemnified party, the
indemnifying party shall have no further liability under such subsection to
such indemnified party unless such indemnifying party shall have received
other notice addressed and delivered in the manner provided in Section 11
hereof of the commencement of such action; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have
to any indemnified party otherwise than under such subsection. In case any
such action shall be brought against any indemnified party and it shall
notify the indemnifying party of the commencement thereof, the indemnifying
party shall be entitled to Participate therein and, to the extent that it
shall wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel satisfactory to such indemnified
party (who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party), and, after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party shall not be liable to such indemnified party
under such subsection for any legal expenses of other counsel or any other
expenses, in each case subsequently incurred by such indemnified party, in
connection with the defense thereof other than reasonable costs of
investigation.
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(d) If the indemnification provided for in this Section 7
is unavailable to an indemnified party under subsection (a) or (b) above in
respect of any losses, claims, damages or liabilities (or actions in respect
thereof) referred to therein, then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable
by such indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the
one hand and each Agent on the other from the offering of the Securities to
which such loss, claim, damage or liability (or action in respect thereof)
relates. If, however, the allocation provided by the immediately preceding
sentence is not permitted by applicable law or if the indemnified party
failed to give the notice required under subsection (c) above, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only
such relative benefits but also the relative fault of the Company on the one
hand and the Agents on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one
hand and the Agents on the other shall be deemed to be in the same proportion
as the total net proceeds from the sale of Securities (before deducting
expenses) received by the Company bear to the total commissions or discounts
received by the Agents in respect thereof. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to
state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading relates to information supplied by
the Company on the one hand or by the Agents on the other and the parties'
relative intent, knowledge, access to information and opportunity to correct
or prevent such statement or omission. The Company and the Agents agree that
it would not be just and equitable if contribution pursuant to this
subsection (d) were determined by pro rata allocation (even if the Agents
were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or liabilities
(or actions in respect thereof) referred to above in this subsection (d)
shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this subsection (d), no
Agent shall be required to contribute any amount in excess of the amount by
which the total public offering price at which the Securities purchased by or
through such Agent were sold exceeds the amount of any damages which such
Agent has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of each of the Agents under
this subsection (d) to contribute are several in proportion to the respective
purchases made by or through it to which such loss, claim, damage or
liability (or action in respect thereof) relates and are not joint.
(e) The obligations of the Company under this Section 7
shall be in addition to any liability which the Company may otherwise have
and shall extend, upon the same terms and conditions, to each person, if any,
who controls any Agent within the
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meaning of the Act; and each Agent's obligations under this Section 7 shall be
in addition to any liability which such Agent may otherwise have and shall
extend, upon the same terms and conditions, to each officer and director of the
Company and to each person, if any, who controls the Company within the meaning
of the Act.
8. In soliciting offers by others to purchase Securities
from the Company, the Agents are acting solely as agents for the Company, and
not as principals. The Agents will make reasonable efforts to assist the
Company in obtaining performance by each purchaser whose offer to purchase
Securities from the Company has been accepted by the Company, but the Agents
shall not have any liability to the Company in the event such purchase for
any reason is not consummated. If the Company shall default on its
obligation to deliver Securities to a purchaser whose offer it has accepted,
the Company shall hold harmless the Agents against any loss, claim or damage
arising from or as a result of such default by the Company.
9. The respective indemnities, agreements,
representations, warranties and other statements of the several Agents and
the Company set forth in this Agreement or made by them pursuant to this
Agreement, shall remain in full force and effect regardless of any
investigation (or any statement as to the results thereof) made by or on
behalf of the Agents or the Company or any of its officers or directors or
any controlling person, and shall survive each delivery of and payment for
any of the Securities.
10. The provisions of this Agreement relating to the
solicitation of offers to purchase the Securities may be suspended or
terminated at any time by the Company or by the Agents upon the giving of
written notice of such suspension or termination to the other party hereto.
In the event of any such suspension or termination, no party shall have any
obligation or liability to the other party hereto, except as provided in the
third paragraph of Section 2(a), Section 4 (d) , Section 5, Section 7,
Section 8 and Section 9 and except that, if at the time of such suspension or
termination, an offer for the purchase of Securities shall have been accepted
by the Company but the delivery of the Securities relating thereto to the
purchaser or his agent shall not yet have occurred, the Company shall have
the obligations provided in subsections (g) , (h) , (i) , (j) , (k) and (1)
of Section 4.
11. Except as otherwise specifically provided herein or in
the Procedure, all statements, requests, notices and advices hereunder shall
be in writing and if to the Agents shall be delivered or sent by mail, telex
or facsimile transmission to the addresses specified above, and if to the
Company shall be delivered or sent by mail, telex or facsimile transmission
to Attn: Treasurer, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇. ▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
facsimile (▇▇▇) ▇▇▇-▇▇▇▇. Any such statements, requests, notices or advices
shall take effect on receipt thereof.
12. This Agreement and any Terms Agreement shall be binding
upon, and inure solely to the benefit of the Agents and the Company, and to
the extent provided in Section 7, Section 8 and Section 9 hereof, the
officers and directors of the Company and any person who controls any Agent
or the Company, and the Agents' respective heirs, executors, administrators,
successors and assigns, and no other person shall acquire or have any right
under or by virtue of this Agreement or any Terms Agreement. No
-20-
21
purchaser of any of the Securities through or from the Agents shall be deemed a
successor or assign by reason of such purchase.
13. This Agreement and any Terms Agreement shall be
governed by, and construed in accordance with, the laws of the State of New
York.
14. Time shall be of the essence in this Agreement and any
Terms Agreement. As used herein, "business day" shall mean any day when the
Commission's office in Washington, D.C. is open for business, unless
otherwise defined herein.
15. This Agreement and any Terms Agreement may be executed
by any one or more of the parties hereto and thereto in any number of
counterparts, each of which shall be an original, but all of such respective
counterparts shall together constitute one and the same instrument.
If the foregoing is in accordance with your understanding, please
sign and return to us four counterparts hereof, whereupon this letter and the
acceptance by each of you thereof shall constitute a binding agreement
between the Company and you in accordance with its terms.
Very truly yours,
MONSANTO COMPANY
By:
-------------------------------------
Accepted in New York, New York,
as of the date hereof:
-------------------------------------
(▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.)
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
By:
-----------------------------------
-21-
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SCHEDULE I
----------
----------------------------------------------------------------------
Maturities Rates of Commission
-------------- -------------------
----------------------------------------------------------------------
More than 9 mos. to less 1 yr. .125%
----------------------------------------------------------------------
1 yr. to less than 18 mos. .150
----------------------------------------------------------------------
18 mos. to less than 2 yrs. .200
----------------------------------------------------------------------
2 yrs to less than 3 yrs. .250
----------------------------------------------------------------------
3 yrs. to less than 4 yrs. .350
----------------------------------------------------------------------
4 yrs. to less than 5 yrs. .450
----------------------------------------------------------------------
5 yrs. to less than 6 yrs. .500
----------------------------------------------------------------------
6 yrs. to less than 7 yrs. .550
----------------------------------------------------------------------
7 yrs. to less than 8 yrs. .600
----------------------------------------------------------------------
8 yrs. to less than 9 yrs. .600
----------------------------------------------------------------------
9 yrs. to less than 10 yrs. .600
----------------------------------------------------------------------
10 yrs. to less than 15 yrs. .625
----------------------------------------------------------------------
15 yrs. to less than 20 yrs. .675
----------------------------------------------------------------------
20 yrs. to less than 30 yrs. .750
----------------------------------------------------------------------
30 yrs. to 40 yrs. negotiable among the Company
and the Agents at the time
the Company issues such a security
----------------------------------------------------------------------
For the purposes of this Schedule I, the maturity of a security that
is repayable by the Company at the option of the holder will be
negotiable among the Company and the Agents at the time the Company
issues such a security.
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23
ANNEX I
Monsanto Company
Medium-Term Notes, Series D
TERMS AGREEMENT
---------------
, 199
------------- -
[Name and Address of Agent]
Dear Sirs:
Monsanto Company (the "Company") proposes, subject to the terms and
conditions stated herein and in the Distribution Agreement, dated January
---, 1998 (the "Distribution Agreement") among the Company and the Agents (as
therein defined) to issue and sell to [the Agent] the securities specified in
the Schedule hereto (the "Purchased Securities"). Each of the provisions of
the Distribution Agreement not specifically related to the solicitation by
the Agents, as agents of the Company, of offers to purchase Securities is
incorporated herein by reference in its entirety, and shall be deemed to be
part of this Agreement to the same extent as if such provisions had been set
forth in full herein. Nothing contained herein or in the Distribution
Agreement shall make any party hereto an agent of the Company or make such
party subject to the provisions therein relating to the solicitation of
offers to purchase securities from the Company, solely by virtue of its
execution of this Agreement. Each of the representations and warranties set
forth therein shall be deemed to have been made at and as of the date of this
Terms Agreement, except that each representation and warranty with respect to
the Prospectus in Section 1 of the Distribution Agreement shall be deemed to
be a representation and warranty as of the date of the Distribution Agreement
in relation to the Prospectus (as therein defined), and also a representation
and warranty as of the date of this Terms Agreement in relation to the
Prospectus as amended and supplemented to relate to the Purchased Securities.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Purchased Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Distribution Agreement incorporated herein by reference, the Company agrees
to issue and sell to [the Agent] and the Agent agree[s] to purchase from the
Company the Purchased Securities, at the time and place, in the principal
amount and at the purchase price set forth in the Schedule hereto.
24
If the foregoing is in accordance with your understanding, please sign
and return to us three counterparts hereof, and upon acceptance hereof by you
this letter and such acceptance hereof, including those provisions of the
Distribution Agreement incorporated herein by reference, shall constitute a
binding agreement between [the Agent] and the Company.
This Agreement shall be in the form of an executed writing (which may
be in counterparts), and may be evidenced by an exchange of telegraphic
communications or any other rapid transmission device designed to produce a
written record of communications transmitted.
MONSANTO COMPANY
By:
-------------------------------------
Authorized Officer
Accepted:
[Name and Signature of Agent]
-2-
25
Schedule to Annex I
Title of Purchased Securities:
Medium-Term Notes, Series D
Aggregate principal amount:
$
[Denominations]
[Price to Public:]
Purchase Price by [the Agent]:
---% of the principal amount of the Purchased Securities[, plus accrued
interest from -------- to --------] [and accrued amortization, if any,
from --------- to ----------]
Method of and specified funds for payment of purchase price:
Indenture:
Indenture, dated as of August 1, 1990, between the Company and The
Chase Manhattan Bank (National Association), as Trustee.
Maturity:
Interest Rate:
[---%], payable from [--------------, 19-]
Interest Payment Dates:
------------------------------------------------------------------------
Time of Delivery:
Closing Location:
Documents to be Delivered:
The following documents referred to in the Distribution Agreement shall
be delivered:
-3-
26
[(1) The officers' certificate referred to in Section 4(h).]
[(2) The opinion referred to in Section 4(i).]
[(3) The opinion referred to in Section 4(j).]
[(4) The accountants' letter referred to in Section 4(k).]
Other provisions (including syndicate provisions, if applicable):
-4-
27
ANNEX II
Monsanto Company
Administrative Procedure
------------------------
This Administrative Procedure relates to the Securities defined
in the Distribution Agreement, dated January ---, 1998 (the "Distribution
Agreement"), among Monsanto Company (the "Company") and ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
and ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated (together, with any
other party appointed by the Company pursuant to Paragraph 2(a) of the
Distribution Agreement, the "Agents"), to which this Administrative Procedure
is attached as Annex II. Defined terms used herein and not defined herein
shall have the meanings given such terms in the Distribution Agreement, the
Prospectus as amended or supplemented or the Indenture dated as of August 1,
1990 between the Company and The Chase Manhattan Bank (National Association)
as Trustee (herein called the "Trustee", which term includes any successor
trustee under the Indenture).
The procedures to be followed with respect to the settlement of
sales of Securities directly by the Company to purchasers solicited by an
Agent, as agent, are set forth below. Part I describes procedures of general
applicability with respect to such Securities. Part II below describes
procedures specifically and exclusively applicable (any procedure in Part I
below to the contrary notwithstanding) to such Securities which are either
Global Certificates or Book-Entry Securities (each as defined below). The
terms and settlement details related to a purchase of Securities by an Agent,
as principal, from the Company will be set forth in a Terms Agreement
pursuant to the Distribution Agreement, unless the Company and such Agent
otherwise agree as provided in Section 2(b) of the Distribution Agreement, in
which case the procedures to be followed in respect of the settlement of such
sale will be as set forth below. An Agent, in relation to a purchase of a
Security by a purchaser solicited by such Agent, is referred to herein as the
"Selling Agent" and, in relation to a purchase of a Security by such Agent as
principal other than pursuant to a Terms Agreement, as the "Purchasing
Agent".
The Company will advise each Agent and the Trustee in writing of
those persons with whom such Agent is to communicate regarding offers to
purchase Securities and the related settlement details.
Each Security will be issued only in fully registered form and
will be initially represented by either a permanent global certificate (a
"Global Certificate") delivered to the Trustee, as agent for The Depository
Trust Company (the "Depository") or a certificate (a "Definitive
Certificate") delivered to a person designated by an Agent. Each security
which is represented by a Global Certificate is referred to herein as a
"Book-Entry Security" (it being understood that only such Global Certificate
-- and not any such Book-Entry Security represented thereby -- constitutes a
"Security" under the Indenture).
28
Pursuant to Sections 301 and 1002 of the Indenture, the Company
has appointed the Trustee as Paying Agent (the "Paying Agent"), as
Calculation Agent (the "Calculation Agent") and as Exchange Agent (the
"Exchange Agent") for the Securities.
PART I: PROCEDURES OF GENERAL APPLICABILITY
Posting Rates by Company:
------------------------
The Company and the Agents will discuss from time to time the
rates of interest per annum to be borne by and the maturity of Securities
that may be sold as a result of the solicitation of offers by an Agent. The
Company may establish a fixed set of interest rates and maturities for an
offering period ("posting"). If the Company decides to change already posted
rates, it will promptly advise the Agents to suspend solicitation of offers
until the new posted rates have been established with the Agents.
Acceptance of Offers by Company:
-------------------------------
Each Agent will promptly advise the Company by telephone or other
appropriate means of all reasonable offers to purchase Securities, other than
those rejected by such Agent. Each Agent may, in its discretion reasonably
exercised, reject any offer received by it in whole or in part. Each Agent
also may make offers to the Company to purchase Securities as a Purchasing
Agent. The Company will have the sole right to accept offers to purchase
Securities and may reject any such offer in whole or in part.
The Company will promptly notify the Selling Agent or Purchasing
Agent, as the case may be, of its acceptance or rejection of an offer to
purchase Securities. If the Company accepts an offer to purchase Securities,
it will confirm such acceptance in writing to the Selling Agent or Purchasing
Agent, as the case may be, and the Trustee.
Communication of Sale Information
to Company by Selling Agent:
---------------------------------
After the acceptance of an offer by the Company, the Selling
Agent or Purchasing Agent, as the case may be, will promptly communicate the
following details of the terms of such offer (the "Sale Information") to the
Company by telephone (confirmed in writing) or by facsimile transmission or
other acceptable written means:
(1) Principal amount of Securities to be purchased;
(2) If a Fixed Rate Security, the interest rate;
(3) Stated Maturity Date;
(4) Specified Currency or Currencies and, if the Specified
Currency or Currencies is other than U.S. dollars, the
applicable Exchange Rate for such Specified Currency or
Currencies and the Exchange Rate Agent;
-2-
29
(5) Issue Price;
(6) Selling Agent's commission or Purchasing Agent's
discount, as the case may be;
(7) Net proceeds to the Company;
(8) Settlement Date;
(9) If a Security redeemable at the option of the Company
or repayable at the option of the holder, such of the
following as are applicable:
(i) Redemption Commencement Date,
(ii) Redemption Prices (% of par) and Redemption
Periods;
(iii) the Repayment Date(s) and the Repayment
Price;
(10) If a Floating Rate Security, such of the following as
are applicable:
(i) Interest Rate Basis,
(ii) Index Maturity,
(iii) Spread or Spread Multiplier,
(iv) Maximum Rate,
(v) Minimum Rate,
(vi) Initial Interest Rate,
(vii) Interest Rate Reset Dates,
(viii) Calculation Dates,
(ix) Interest Determination Dates,
(x) Interest Payment Dates,
(xi) Regular Record Dates, and
(xii) Calculation Agent;
-3-
30
(11) Name, address and taxpayer identification
number of the registered owner;
(12) Denomination of certificates to be delivered
at settlement;
(13) Original Issue Date;
(14) If a Currency Indexed Note, such of the
following as are applicable:
(i) Specified Currency,
(ii) Indexed Currency,
(iii) Face Amount,
(iv) Base Exchange Rate, and
(v) Determination Agent;
(15) If a Commodity Indexed Note or a Note indexed
to some other index or indices, the commodity
or other index or indices and the method for
calculating interest and principal; and
(16) If an OID Note, the total amount of the OID
Note, the yield to maturity and the initial
accrual period of OID.
Preparation of Pricing Supplement by Company:
--------------------------------------------
If the Company accepts an offer to purchase a Security, it will
prepare a Pricing Supplement. The Company will supply a copy of such Pricing
Supplement to the Selling Agent or Purchasing Agent, as the case may be, not
later than 12:00 noon, New York City time, on the business day following the
date of acceptance of such offer, or if the Company and the purchaser agree to
settlement on the date of such acceptance (for Securities that are not
book-entry Securities), not later than noon, New York City time, on such date.
The Pricing Supplement should be delivered via facsimile transmission to
▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, (▇▇▇) ▇▇▇-▇▇▇▇, -2775, -2776 and
▇▇▇▇▇▇▇ ▇▇▇▇▇, Attn: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, (▇▇▇) ▇▇▇-▇▇▇▇. The Company will
arrange to have each Pricing Supplement filed with the Commission under
Rule 424(b) not later than the close of business of the Commission on the
fifth business day following the date on which such Pricing Supplement is
first used.
-4-
31
Delivery of Confirmation and Prospectus
to Purchaser by Selling Agent:
---------------------------------------
The Selling Agent will deliver to the purchaser of a Security a
written confirmation of the sale and delivery and payment instructions. In
addition, the Selling Agent will deliver to such purchaser or its agent the
Prospectus as amended or supplemented (including the Pricing Supplement) in
relation to such Security prior to or together with the earlier of the
delivery to such purchaser or its agent of (a) the confirmation of sale
(including, in the case of a Book-Entry Security, the confirmation through
the Depository's Institutional Delivery System) or (b) the Security.
Date of Settlement:
------------------
All offers solicited by a Selling Agent or made by a Purchasing
Agent and accepted by the Company will be settled on a date (the "Settlement
Date") which is the third business day after the date of acceptance of such
offer, unless the Company and the purchaser agree to settlement (a) on any
other business day after the acceptance of such offer or (b) with respect to
an offer accepted by the Company prior to 10:00 a.m., New York City time, on
the date of such acceptance (for securities that are not Book-Entry
Securities).
Instruction from Company to Trustee
for Preparation of Securities:
-----------------------------------
After receiving the Sale-Information from the Selling Agent or
Purchasing Agent, as the case may be, the Company will communicate such Sale
Information to the Trustee by telephone (confirmed in writing) or by
facsimile transmission or other acceptable written means.
The Company will instruct the Trustee by facsimile transmission
or other acceptable written means to authenticate and deliver the Securities no
later than 2:15 p.m., New York City time, on the Settlement Date. Such
instruction will be given by the Company prior to 3:00 p.m., New York City
time on the business day prior to the Settlement Date unless the Settlement
Date is the date of acceptance by the Company of the offer to purchase
Securities in which case such instruction will be given by the Company by
11:00 a.m., New York City time.
Preparation and Delivery of Securities by
Trustee and Receipt of Payment Therefor:
---------------------------------------
The Trustee will prepare each Security and appropriate receipts
that will serve as the documentary control of the transaction.
In the case of a sale of Securities to a purchaser solicited by
an Agent, the Trustee will, by 2:15 p.m., New York City time, on the Settlement
Date, release the Securities
-5-
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to the Selling Agent for the benefit of the purchaser of such Securities
against delivery by the Selling Agent of a receipt therefor. On the
Settlement Date the Selling Agent will deliver payment for such Securities in
immediately available funds to the Company in an amount equal to the issue
price of the Securities less the Selling Agent's commission; provided that the
Selling Agent reserves the right to withhold payment for which it has not
received funds from the purchaser. The Company shall not use any proceeds
advanced by a Selling Agent to acquire Securities.
In the case of a sale of Securities to a Purchasing Agent, the
Trustee will, by 2:15 p.m., New York City time, on the Settlement Date,
release the Securities to the Purchasing Agent against evidence of receipt of
payment for such Securities in immediately available funds to the Company in
an amount equal to the issue price of the Securities less the Purchasing
Agent's discount.
Failure of Purchaser to Pay Selling Agent:
-----------------------------------------
If a purchaser (other than a Purchasing Agent) fails to make
payment to the Selling Agent for a Security or the Selling Agent fails to
make payment to the Company, the Selling Agent will promptly notify the
Trustee and the Company thereof by telephone (confirmed in writing). The
Selling Agent will immediately return the Security to the Trustee.
Immediately upon receipt of such Security by the Trustee, the Company will
return to the Selling Agent an amount equal to the amount previously paid to
the Company in respect of such Security. The Company will reimburse the
Selling Agent on an equitable basis for its loss of the use of funds during
the period when they were credited to the account of the Company.
The Trustee will cancel the Security in respect of which the
failure occurred, make appropriate entries in its records and, unless
otherwise instructed by the Company, destroy the Security.
PART II: PROCEDURES APPLICABLE TO BOOK-ENTRY
SECURITIES AND GLOBAL SECURITIES
In connection with the qualification of Book-Entry Securities for
eligibility in the book-entry system maintained by the Depository, the
Trustee and the Paying Agent will perform the custodial, document control and
administrative functions described below, in accordance with their respective
obligations under a Letter of Representations from the Company and the
Trustee to the Depository, dated January ---, 1998, and a Medium-Term Note
Series D Certificate Agreement dated January ---, 1998, between the Trustee
and the Depository (the "Certificate Agreement"), and the obligations of the
Trustee as a participant in the Depository, including the Depository's
Same-Day Funds Settlement System ("SDFS"). It is understood that the
ownership interests of purchasers of Book-Entry Securities will be credited
to the book-entry accounts of one or more participants in the Depository
(each a "Participant") in accordance with the Depository's customary
practices and reflected in the records of such Participants or one or more
indirect participants in the Depository designated by such purchasers in
accordance with the arrangements between
-6-
33
such purchasers and such Participants and indirect participants. As used in
this Part II, the term "Business Day" means each Monday, Tuesday, Wednesday,
Thursday and Friday which is not a day on which banking institutions in The
City of New York are authorized or obligated by law to close.
Issuance: All Fixed Rate Securities which are Book-Entry
Securities and have the same Original Issue Date,
redemption or repayment provisions, Interest Payment
Dates, interest rate, Indexed Currency, if any, indexed
commodity, if any, equity index or indices, if any, and
Stated Maturity (collectively, the "Fixed Rate Terms")
will be represented initially by a single Global
Certificate in fully registered form without coupons;
all Floating Rate Securities which are Book-Entry
Securities and have the same original Issue Date,
redemption or repayment provisions, Interest Payment
Dates, Interest Rate Basis, Initial Interest Rate,
Index Maturity, Spread or Spread Multiplier, if any,
Minimum Interest Rate, if any, Maximum Interest Rate,
if any, equity index or, indices, if any, Indexed
Currency, if any, indexed commodity, if any, and Stated
Maturity (collectively, the "Floating Rate Terms") will
be represented initially by a single Global Certificate
in fully registered form without coupons; and all Zero
Coupon Securities which are Book-Entry Securities and
have the same Original Issue Date, redemption or
repayment provisions, yield to maturity, Specified
Currency and Stated Maturity (collectively, the "Zero
Coupon Terms") will be represented initially by a
single Global Certificate in fully registered form
without coupons.
Identification: The Company has arranged with the CUSIP Service Bureau
of Standard Poor's Corporation (the "CUSIP Service
Bureau") for the reservation of approximately 900 CUSIP
numbers which have been reserved for future assignment
relating to Book-Entry Securities, and the Company has
delivered to the Trustee and the Depository such list
of such CUSIP numbers. The Trustee will assign CUSIP
numbers to Book-Entry Securities as described below
under Settlement Procedure B. The Depository will
notify the CUSIP Service Bureau periodically of the
CUSIP numbers that the Trustee has assigned to
Book-Entry Securities. The Trustee will notify the
Company at any time when fewer than 100 of the reserved
CUSIP numbers remain unassigned to Book-Entry
Securities, and, if it deems necessary, the Company
will reserve additional CUSIP numbers for assignment to
Book-Entry Securities. Upon obtaining such additional
CUSIP numbers, the Company will deliver a list of such
additional numbers to the Trustee and the Depository.
Book-Entry Securities having an aggregate principal
amount in excess of $200,000,000 and otherwise required
to be represented by the same Global Certificate will
instead be represented by two or more Global
Certificates which shall all be assigned the same CUSIP
number.
-7-
34
Registration: Each Global Certificate will be registered in the
name of Cede & Co., as nominee for the Depository on the
Security Register maintained by the Trustee under the
Indenture. On the first Business Day of each month,
the Trustee will deliver to the Company a written
statement indicating the total principal amount of
Outstanding Book-Entry Securities as of the immediately
preceding Business Day.
Transfers: Transfers of interests in a Book-Entry Security will be
effected in accordance with arrangements in effect
between Participants (and in certain cases, one or more
indirect participants in the Depository) and the
beneficial transferors and beneficial transferees of
such Book-Entry Security, and the interests of
Participants therein will be reflected as appropriate
by book entries made by the Depository.
Exchanges: The Trustee may deliver to the Depository and the CUSIP
Service Bureau at any time a written notice specifying
(a) the CUSIP numbers of two or more Global
Certificates (i) having the same Fixed Rate Terms
Floating Rate Terms or Zero Coupon Terms, as the case
may be (except that Original Issue Dates need not be
the same), (ii) for which interest (if any) has been
paid to the same date and (iii) which otherwise
constitute Securities of the same series and tenor
under the Indenture; (b) a date, occurring at least 30
days after such written notice is delivered and at
least 30 days before the next Interest Payment Date (if
any) for such Book-Entry Securities, on which such
Global Certificates shall be exchanged for a single
replacement Global Certificate; and (c) a new CUSIP
number, obtained from the Company, to be assigned to
such replacement Global Certificate. Upon receipt of
such a notice, the Depository will send to its
participants (including the Trustee) a written
reorganization notice to the effect that such exchange
will occur on such date. Prior to the specified
exchange date, the Trustee will deliver to the CUSIP
Service Bureau written notice setting forth such
exchange date and the new CUSIP number and stating
that, as of such exchange date, the CUSIP numbers of
the Global Certificates to be exchanged will no longer
be valid. On the specified exchange date, the Trustee
will exchange such Global Certificates for a single
Global Certificate bearing the new CUSIP number and the
CUSIP numbers of the exchanged Global Certificates
will, in accordance with CUSIP Service Bureau
procedures, be retired and not reassigned.
Notwithstanding the foregoing, if the Global
Certificates to be exchanged exceed $200,000,000 in
aggregate principal amount, one replacement Global
Certificate will be authenticated and issued to
represent each $200,000,000 of principal amount of the
exchanged Global Certificates and an additional Global
Certificate will be authenticated and issued to
represent any remaining principal amount of such Global
Certificates (see "Denominations" below).
-8-
35
Denominations: All Book-Entry Securities will be denominated in U.S.
dollars. Book-Entry Securities will be issued in
denominations of $1,000 and an integral multiple
thereof. Global Certificates will be denominated in
principal amounts not in excess of $200,000,000. If
one or more Book-Entry Securities having an aggregate
principal amount in excess of $200,000,000 would, but
for the preceding sentence, be represented by a single
Global Certificate, then one Global Certificate will be
issued to represent each $200,000,000 principal amount
of such Book-Entry Security or Book-Entry Securities
and an additional Global Certificate will be issued to
represent any remaining principal amount of such
Book-Entry Security or Book-Entry Securities. In such
a case, each of the Global Certificates representing
such Book-Entry Security or Securities shall be
assigned the same CUSIP number.
Interest: General. The Depository will arrange for each
-------
pending deposit message described under Settlement
Procedure C below to be transmitted to Standard & Poor's
Corporation, which will use the message to include
certain information regarding the related Book-Entry
Securities in the appropriate daily bond report
published by Standard & Poor's Corporation.
Notice of Interest Payments and Regular Record Dates.
----------------------------------------------------
On the first Business Day of January, April, July and
October of each year, the Paying Agent will deliver to
the Company and the Dividend Department of the
Depository a written list of Regular Record Dates and
Interest Payment Dates that will occur during the
six-month period beginning on such first Business Day
with respect to Book-Entry Securities which are
Floating Rate Notes. Promptly after each Interest
Determination Date for Book-Entry Securities which are
Floating Rate Notes, the Calculation Agent will notify
Standard & Poor's Corporation of the interest rates
determined on such Interest Determination Date.
Payments of
Principal
and Interest: Payments of Interest Only. Promptly after the Record
-------------------------
Date, the Paying Agent will deliver to the Company and
the Dividend Department of the Depository a written
notice specifying by CUSIP number the amount of
interest (if any) to be paid on each Book-Entry
Security on the following Interest Payment Date (other
than an Interest Payment Date coinciding with the
Maturity of such Security) and the total of such
amounts. The Depository will confirm the amount
payable (if any) on each Book-Entry Security on such
Interest Payment Date by reference to the daily bond
reports published by Standard & Poor's Corporation. On
such Interest Payment Date, the Company will pay to the
Paying Agent, and the
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36
Paying Agent in turn will pay to the Depository, such
total amount of interest due (other than at Maturity of
such Security), at the times and in the manner set forth
below under "Manner of Payment".
Payments at Maturity. On or about the first Business
--------------------
Day of each month, the Paying Agent will deliver to the
Company and the Depository a written list of principal,
premium, if any, and interest to be paid on each
Book-Entry Security maturing either at Stated Maturity,
on a Redemption Date or pursuant to a Holder's electing
repayment ("Maturity") in the following month. The
Paying Agent, the Company and the Depository will
confirm the amounts of such principal, premium (if any)
and interest payments with respect to each such
Book-Entry security on or about the fifth Business Day
preceding the Maturity of such Book-Entry Security. At
such Maturity, the Company will pay to the Paying
Agent, and the Paying Agent in turn will pay to the
Depository, the principal amount of such Book-Entry
Security, together with interest and premium, if any,
due at such Maturity, at the times and in the manner
set forth below under "Manner of Payment". Promptly
after payment to the Depository of the principal,
interest and premium, if any, due at the Maturity of
all Book-Entry Securities represented by a particular
Global Certificate, the Paying Agent will deliver to
the Trustee for cancellation such Global Certificate.
Manner of Payment. The total amount of any
-----------------
principal, premium and interest due on Book-Entry
Securities on any Interest Payment Date or at Maturity
shall be paid by the Company to the Paying Agent, in
funds immediately available for use by the Trustee as of
9:00 a.m., New York City time, on such date. The
Company will make such payment on such Book-Entry
Securities by wire transfer to the Paying Agent or by
instructing the Paying Agent to withdraw funds from an
account maintained by the Company at the Paying Agent.
The Company will confirm such instructions in writing or
by facsimile to the Paying Agent. For principal
payments at Maturity prior to 10:00 a.m., New York City
time, on such Maturity or as soon as possible
thereafter, the Paying Agent will pay by separate wire
transfer (using Fedwire message entry instructions in a
form previously specified by the Depository) to an
account at the Federal Reserve Bank of New York
previously specified by the Depository, in funds
available for immediate use by the Depository, each
payment of interest, principal and premium, if any, due
on Book-Entry Securities on such date; and for interest
payments, the Paying Agent will pay the Depository in
same-day funds on the Interest Payment Date in
accordance with existing arrangements between the Paying
Agent and the Depository. Thereafter on each such date,
the Depository will pay, in accordance with its SDFS
operating procedures then in effect, such amounts in
funds available for immediate use to the respective
Participants in whose names
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37
such Book-Entry Securities are recorded in the book-entry
system maintained by the Depository. Once payment has
been made to the Depository, neither the Company, the
Trustee nor the Paying Agent shall have any
responsibility or liability for the payment by the
Depository of the principal of, or premium, if any, or
interest on, the Book-Entry Securities to such
Participants.
Withholding Taxes. The amount of any taxes required
-----------------
under applicable law to be withheld from any interest
payment on a Book-Entry Security will be determined and
withheld by the Participant, indirect participant in
the Depositary or other Person responsible for
forwarding payments and materials directly to the
beneficial owner of such Book-Entry Security, or as
applicable law may otherwise require.
Settlement
Procedures: Settlement Procedures with regard to each Book-Entry
Security sold by each Agent, as agent of the Company,
or purchased by an Agent as a Purchasing Agent, will be
as follows:
A. After the acceptance of an offer by the Company
with respect to a Book-Entry Security, the
Selling Agent or Purchasing Agent, as the case
may be, will promptly communicate the following
details of the terms of such offer (the
"Book-Entry Sale Information") to the Company by
telephone confirmed in writing or by facsimile
transmission or other acceptable written means:
(1) Principal amount of the Book-Entry
Security to be purchased;
(2) If a Fixed Rate security, the interest
rate;
(3) Stated Maturity Date;
(4) Issue Price;
(5) Selling Agent's commission or Purchasing
Agent's discount, as the case may be;
(6) Net proceeds to the Company;
(7) Settlement Date;
(8) If a Security redeemable at the option of
the Company or repayable at the option
of the holder, such of the following as are
applicable:
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(i) Redemption Commencement Date,
(ii) Redemption Prices (% of par) and
Redemption Periods, and
(iii) the Repayment Date(s) and the
Repayment Price;
(9) If a Floating Rate Security, such of the
following as are applicable:
(i) Interest Rate Basis,
(ii) Index Maturity,
(iii) Spread or Spread Multiplier,
(iv) Maximum Rate,
(v) Minimum Rate,
(vi) Initial Interest Rate,
(vii) Interest Rate Reset Dates,
(viii) Calculation Dates,
(ix) Interest Determination Dates,
(x) Interest Payment Dates,
(xi) Regular Record Dates, and
(xii) Calculation Agent;
(10) The taxpayer identification number of the
purchaser;
(11) Original Issue Date;
(12) If a Currency Indexed Note, such of the
following as are applicable:
(i) Specified Currency,
(ii) Indexed Currency,
(iii) Face Amount,
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(iv) Base Exchange Rate, and
(v) Determination Agent;
(13) If a Commodity Indexed Note or a Note
indexed to some other index or indices,
the commodity or other index or indices
and the method for calculating interest
and principal; and
(14) If an OID Note, the total amount of OID,
the yield to maturity and the initial
accrual period of OID.
B. Upon receiving the Book-Entry Sale Information from
the Selling Agent or the Purchasing Agent, as the
case may be, the Company will advise the Trustee by
telephone (confirmed in writing) or by facsimile
transmission or other acceptable written means of
the Book-Entry Sale Information received from the
Selling Agent or the Purchasing Agent, as the case
may be, and the name of such Agent.
C. Upon instruction from the Company, the Trustee will
assign a CUSIP number to the Global Certificate
representing such Book-Entry Security and will
communicate to the Depository, such Agent and
Standard & Poor's Corporation, through the
Depository's Participant Terminal System, a pending
deposit message specifying the following settlement
information:
1. The Book-Entry Sale Information.
2. Identification numbers of the participant
accounts maintained by the Depository on behalf
of the Trustee and such Agent.
3. Identification as a Fixed Rate Security,
Floating Rate Security or Zero Coupon
Security.
4. Initial Interest Payment Date for such
Security, number of days by which such date
succeeds the related record date for Depository
purposes (or, in the case of Floating Rate
Notes which reset weekly, the date five
calendar days preceding such Initial Interest
Payment Date) and, if then calculable, the
amount of interest payable on such Initial
Interest Payment Date (which amount shall have
been confirmed by the Trustee).
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40
5. CUSIP number of the Global Certificate
representing such Book-Entry Security.
6. Whether such Global Certificate will represent
any other Book-Entry Securities issued or to be
issued (to the extent then known).
D. The Company will deliver to the Trustee a
Global Certificate representing such Book-Entry
Security, and the Company will instruct the Trustee
by facsimile transmission or other acceptable
written means to complete and authenticate such
Global Certificate, and to register such Global
Certificate in the name of Cede & Co., as nominee of
the Depository.
E. The Trustee will authenticate the Global Certificate
representing such Book-Entry Security, and will
register such Global Certificate in the name of Cede
& Co., as nominee of the Depository. The Trustee
will take delivery thereof as agent for the
Depository.
F. The Depository will credit such Book-Entry Security
to the participant account of the Trustee maintained
by the Depository.
G. The Trustee will enter an SDFS deliver order
through the Depository's Participant Terminal
System instructing the Depository (i) to debit such
Book-Entry Security to the Trustee's participant
account and credit such Book-Entry Security to the
participant account of the Selling Agent or the
Purchasing Agent, as the case may be, maintained by
the Depository and (ii) to debit the settlement
account of the Selling Agent or the Purchasing
Agent, as the case may be, and credit the settlement
account of the Trustee maintained by the Depository,
in an amount equal to the price of such Book-Entry
Security less such Agent's commission or discount,
as the case may be. Any entry of such a deliver
order shall be deemed to constitute a confirmation
by the Trustee to the Depository that (i) the
Global Certificate representing such Book-Entry
Security has been issued and authenticated and (ii)
the Trustee is holding such Global Certificate as
agent of the Depository pursuant to the Certificate
Agreement.
H. The Selling Agent or the Purchasing Agent,
as the case may be, will enter an SDFS deliver
instruction through the Depository's Participant
Terminal System instructing the Depository (i) to
debit such Book-Entry Security to the participant
account of such Agent and credit such Book-
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41
Entry Security to the participant accounts of the
Participants with respect to such Book-Entry
Security maintained by the Depository and (ii) to
debit the settlement accounts of such Participants
and credit the settlement account of such Agent
maintained by the Depository in an amount equal to
the price of such Book-Entry Security.
I. Transfers of funds in accordance with SDFS deliver
orders described in Settlement procedures G and H
will be settled in accordance with SDFS operating
procedures in effect on the Settlement Date.
J. The Trustee will credit to an account of the Company
maintained at the Trustee funds available for
immediate use in the amount transferred to the
Trustee in accordance with Settlement Procedure G.
K. The Trustee will send a copy of the Global
Certificate by first-class mail to the Company
together with a statement setting forth the
principal amount of Securities outstanding and of
Book-Entry Securities Outstanding as of the related
Settlement Date after giving effect to such
transaction and all other offers to purchase
Securities of which the Company has advised the
Trustee but which have not yet been settled.
L. The Selling Agent or the Purchasing Agent, as
the case may be, will confirm the purchase of
such Book-Entry Security to the purchaser either by
transmitting to the Participants with respect to
such Book-Entry Security a confirmation order
through the Depository's Participant Terminal system
or by mailing a written confirmation to such
purchaser.
M. Notwithstanding the foregoing, the Selling Agent
shall in all cases take the actions described under
the caption "Delivery of Confirmation and Prospectus
to Purchaser by Selling Agent" in Part I of this
Administrative Procedure, at the time or times
specified under such caption for such actions.
Settlement
Procedures
Timetable: For orders of Book-Entry Securities accepted by the
Company, Settlement Procedures "A" through "L" set
forth above shall be completed as soon as possible but
not later than the respective times (New York City
time) set forth below:
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42
--------------------------------------------------
Settlement
Procedure Time
---------- ----
--------------------------------------------------
A 10:00 a.m. on the Business Day
following the Trade Date
--------------------------------------------------
B 1:00 p.m. on the second
Business Day immediately
preceding the Settlement
Date
--------------------------------------------------
C 3:00 p.m. on the second
Business Day immediately
preceding the Settlement
Date
--------------------------------------------------
D-E 9:00 a.m. on the Settlement Date
--------------------------------------------------
F 10:00 a.m. on the Settlement Date
--------------------------------------------------
G-H 2:00 p.m. on Settlement Date
--------------------------------------------------
I 4:45 p.m. on Settlement Date
--------------------------------------------------
J 5:00 p.m. on Settlement Date
--------------------------------------------------
If a sale is to be settled more than one Business Day
after the trade date, Settlement Procedures A, B, and C
may, if necessary, be completed at any time prior to
the specified times on the first Business Day after the
trade date. In connection with a sale which is to be
settled more than one Business Day after the trade
date, if the initial interest rate for a Floating Rate
Note is not known at the time that Settlement Procedure
A is completed, Settlement Procedures B and C shall be
completed as soon as such rates have been determined,
but not later than 12 Noon and 2:00 p.m., New York City
time, respectively, on the second Business Day before
the Settlement Date. Settlement Procedure I is subject
to extension of Fedwire closing deadlines and in the
other events specified in the SDFS operating procedures
in effect on the settlement date.
If settlement of a Book-Entry Security is rescheduled
or cancelled, the Company will as soon as practicable
give the Trustee notice to such effect. The Trustee
will deliver to the Depository, through the
Depository's Participant Terminal System, a
cancellation message
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43
(the form of which has been previously furnished to the
Trustee by the Depository) to such effect by no later
than 2:00 p.m., New York City time, on the Business Day
immediately preceding the scheduled Settlement Date. A
copy of such message will be routed through the
facilities of the Depository to the Selling Agent and
Standard & Poor's Corporation.
Failure to
Settle: If the Trustee fails to enter in timely fashion an SDFS
deliver order with respect to any portion of a
Book-Entry Security pursuant to Settlement Procedure G,
or if the Selling Agent or the Purchasing Agent, as the
case may be, fails to enter in timely fashion an SDFS
deliver order with respect to such Book-Entry Security
pursuant to Settlement Procedure H, the Trustee shall
deliver to the Depository, through the Depository's
Participant Terminal System, as soon as practicable,
but in any event prior to 2:00 P.M. on the Settlement
Date a withdrawal message (the form of which has been
previously furnished to the Trustee by the Depository)
instructing the Depository to debit such Book-Entry
Security to the participant account of the Trustee
maintained at the Depository. A copy of such message
will be routed through the facilities of the Depository
to such Agent. The Depository will process the
withdrawal message, provided that such participant
account contains Book-Entry Securities having the same
Fixed Rate Terms, Floating Rate Terms or Zero Coupon
Terms, as the case may be, having an aggregate
principal amount that is at least equal to the
principal amount to be debited. If withdrawal messages
are processed with respect to all Book-Entry Securities
represented by a particular Global Certificate, the
Trustee will cancel immediately such Global
Certificate, make appropriate entries in its records
and, unless otherwise instructed by the Company,
destroy the Global Certificate. The CUSIP number
assigned to such Global Certificate shall, in
accordance with CUSIP Service Bureau procedures, be
retired and not reassigned. If withdrawal messages are
processed with respect to only a portion of the
Book-Entry Securities represented by a particular
Global Certificate, the Trustee, will exchange such
Global Certificate for two Global Certificates
authenticated by the Trustee, one of which shall
represent Book-Entry Securities for which withdrawal
messages are processed and shall be cancelled by the
Trustee and destroyed immediately after issuance, and
the other of which shall represent the other Book-Entry
Securities previously represented by the surrendered
Global Certificate and shall bear the CUSIP number of
the surrendered Global Certificate. The Company will
reimburse such Agent on an equitable basis for its loss
of the use of funds during any period when the funds
were credited to the account of the Company in
connection with such attempted settlement.
If the purchase price for any Book-Entry Security
is not timely paid to the Participants with
respect to such Security by the beneficial
purchaser thereof or by a person, including an
indirect participant in the Depository, acting on
behalf of such purchaser (other than the
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44
Purchasing Agent, if any), such Participants and,
in turn, the Selling Agent or the Purchasing
Agent, as the case may be, may enter SDFS deliver
orders through the Depository's Participant
Terminal System reversing the orders entered
pursuant to Settlement Procedures G and H,
respectively. Immediately thereafter, the
Trustee will deliver the withdrawal message and
take the related actions described in the
preceding paragraph. The Company will reimburse
such Agent on an equitable basis for its loss of
the use of funds during any period when the funds
were credited to the account of the Company in
connection with such attempted settlement.
Notwithstanding the foregoing, upon any failure
to settle with respect to any portion of a
Book-Entry Security, the Depository may take any
actions in accordance with its SDFS operating
procedures then in effect. In the event of a
failure to settle with respect to any portion of
a Book-Entry Security that was to have been
represented by a Global Certificate also
representing other Book-Entry Securities, the
Trustee will provide, in accordance with
Settlement Procedures D and E, for the
authentication and issuance of a Global
Certificate representing the remaining principal
amount to have been represented by such Global
Certificate and will make appropriate entries in
its records.
Trustee and Paying
Agents Not to
Risk Funds: Nothing herein will be deemed to require the
Trustee or the Paying Agent to risk or expend its
own funds in connection with any payment to the
Company, the Agents, the Depository or any
Securityholder, it being understood by all
parties that payments, made by the Trustee or the
Paying Agent to any party will be made only to
the extent that funds are provided to the Trustee
or the Paying Agent, as the case may be, for such
purposes.
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45
ANNEX III
Pursuant to Section 4(k) and Section 6(d), as the case
may be, of the Distribution Agreement, Deloitte & Touche LLP shall furnish
letters to the Agents to the effect that:
(i) They are independent certified public accountants with
respect to the Company and its subsidiaries within the meaning of the
Act and the applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules examined by them and
included or incorporated by reference in the Registration Statement or
the Prospectus comply as to form in all material respects with the
applicable accounting requirements of the Act or the Exchange Act, as
applicable, and the related published rules and regulations thereunder;
and, if applicable, they have made a review and issued a report in
accordance with standards established by the American Institute of
Certified Public Accountants of the consolidated interim financial
statements, selected financial data, pro forma financial information
and/or condensed financial statements derived from audited financial
statements of the Company for the periods specified in such letter, as
indicated in their reports thereon, if any, and copies of any such
report have been furnished to the Agents;
(iii) On the basis of limited procedures, not constituting an
audit in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available
interim consolidated financial statements of the Company and its
subsidiaries, inspection of the minute books of the Board of Directors and
the Executive and Audit Committees of the Board of Directors of the
Company since the date of the latest audited financial statements included
or incorporated by reference in the Prospectus, inquiries of officials of
the Company responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter,
nothing came to their attention that caused them to believe that:
(A) the unaudited condensed consolidated statements
of income, financial position and cash flow included or
incorporated by reference in the Company's Quarterly Reports on
Form 10-Q incorporated by reference in the Prospectus do not
comply as to form in all material respects with the applicable
accounting requirements of the Exchange Act as it applies to Form
10-Q and the related published rules and regulations thereunder
or are not in conformity with generally accepted accounting
principles applied on a basis substantially consistent with the
basis for the audited consolidated statements of income,
financial position and cash flow included or incorporated by
reference in the Company's Annual Report on Form 10-K for the most
recent fiscal year;
46
(B) any other unaudited income statement data and
statement of financial position items included in the Prospectus
do not agree with the corresponding items in the unaudited
consolidated financial statements from which such data and items
were derived, and any such unaudited data and items were not
determined on a basis substantially consistent with the basis for
the corresponding amounts in the audited consolidated financial
statements included or incorporated by reference in the Company's
Annual Report on Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not
included in the Prospectus but from which were derived the
unaudited condensed financial statements referred to in Clause
(A) and any unaudited income statement data and statement of
financial position items included in the Prospectus and referred to
in Clause (B) were not determined on a basis substantially
consistent with the basis for the audited financial statements
included or incorporated by reference in the Company's Annual Report
on Form 10-K for the most recent fiscal year;
(D) any unaudited pro forma condensed consolidated
financial statements included or incorporated by reference in the
Prospectus do not comply as to form in all material respects with
the applicable accounting requirements of the Act and the
published rules and regulations thereunder or the pro forma
adjustments have not been properly applied to the historical
amounts in the compilation of those statements;
(E) as of a specified date not more than five
calendar days prior to the date of such letter, there have been
any changes in the capital stock (other than issuances of capital
stock upon exercise of options and stock appreciation rights,
upon earn-outs of performance shares and upon conversions of
convertible securities, in each case which were outstanding on
the date of the latest statement of financial position included or
incorporated by reference in the Prospectus) or any increase,
excluding those changes due solely to fluctuations in foreign
currency exchange rates, in the consolidated long-term debt or
guaranteed obligations of the Company and its subsidiaries or any
decreases in consolidated net current assets or net assets, in
each case as compared with amounts shown in the latest statement
of consolidated financial position included or incorporated by
reference in the Prospectus, except in each case for changes,
increases or decreases which the Prospectus discloses have
occurred or may occur or as a result of any dispositions of
assets which the Prospectus specifically discloses have occurred or
may occur, or, in the case of consolidated long-term debt or
guaranteed obligations, consolidated net current assets or net
assets, for changes, decreases or increases as the case may be,
which are less than $30,000,000, or which are described in such
letter; and
(iv) In addition to the audits referred to in their opinions
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to in paragraph (iii) above,
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47
they have carried out certain specified procedures, not constituting an
audit in accordance with generally accepted auditing standards, with
respect to certain references to the Company's historical annual ratios of
earnings to fixed charges specified by the Agents which references are
derived from the general accounting records of the Company and its
subsidiaries, which appear in the Prospectus (excluding documents
incorporated by reference), or in Part II of, or in exhibits and schedules
to, the Registration Statement specified by the Agents or in documents
incorporated by reference in the Prospectus specified by the Agents, and
have compared certain of the amounts, percentages and financial
information contained in such references with the accounting records of
the Company and its subsidiaries and have found them to be in
agreement.
All references in this Annex III to the Prospectus shall be
deemed to refer to the Prospectus (including the documents incorporated by
reference therein), as defined in the Distribution Agreement, for purposes of
the letter delivered on the Closing Date and to the Prospectus as amended or
supplemented (including the documents incorporated by reference therein), as
defined in the Distribution Agreement, for purposes of any letter delivered
on the date of the amendment, supplement or incorporation, or at the Time of
Delivery related to the Terms Agreement, in connection with which such
delivery is required under Section 4(k) of the Distribution Agreement.
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