GENERAL ▇▇▇▇▇, INC.
$750,000,000
Medium-Term Notes, Series F
Distribution Agreement
May 18, 1999
▇▇▇▇▇▇▇, Sachs & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.,
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated,
▇▇▇▇▇▇▇ ▇▇▇▇▇ World Headquarters,
World Financial Center,
New York, New York 10281
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Warburg Dillon Read LLC
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
General ▇▇▇▇▇, Inc., a Delaware corporation (the "Company"), proposes
to issue and sell from time to time its Medium-Term Notes, Series F (the
"Securities") in an aggregate offering price of up to $750,000,000, or its
equivalent in another currency or composite currency, and agrees with each of
you (individually, an "Agent," and collectively, the "Agents") as set forth in
this Agreement.
Subject to the terms and conditions stated herein and to the
reservation by the Company of the right to sell Securities directly on its own
behalf, the Company hereby (i) appoints each Agent as an agent of the Company
for the purpose of soliciting and receiving offers to purchase Securities from
the Company pursuant to Section 2(a) hereof and (ii) agrees that, except as
otherwise contemplated herein, whenever it determines to sell Securities
directly to any Agent as principal, it will enter into a separate agreement
which may be oral, and confirmed in writing by the applicable Agent (each a
"Terms Agreement"), which may be substantially in the form of Annex I hereto,
relating to such sale in accordance with Section 2(b) hereof.
This Distribution Agreement shall not be construed to create either an
obligation on the part of the Company to sell any securities or an obligation of
any of the Agents to purchase Securities as principal.
The Securities will be issued under an indenture, dated as of February
1, 1996 (the "Indenture"), between the Company and First Trust of Illinois,
National Association, as Trustee (the "Trustee"). The Securities shall have the
maturity ranges, interest rates, if any, redemption provisions and other terms
set forth in the Prospectus referred to below as it may be amended or
supplemented from time to time. The Securities will be issued, and the terms and
rights thereof established, from time to time by the Company in accordance with
the Indenture.
1. The Company represents and warrants to, and agrees with, each Agent
that:
(a) Registration statements on Form S-3 (Registration No.
333-00745 and No. 333-76741 in respect of a total of U.S. $782,000,000
aggregate offering price of debt securities of the Company, including
the Securities, have been filed under the Securities Act of 1933, as
amended (the "Act"), with the Securities and Exchange Commission (the
"Commission") in the form heretofore delivered or to be delivered to
such Agent, excluding exhibits to such registration statements but
including all documents incorporated by reference in the prospectuses
included therein, and such registration statements in such form have
been declared effective by the Commission and no stop order suspending
the effectiveness of either registration statement has been issued and
no proceeding for that purpose has been initiated or to the knowledge
of the Company expressly threatened by
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the Commission (any preliminary prospectus included in either
registration statement being hereinafter called a "Preliminary
Prospectus"; the various parts of each such registration statement,
including all exhibits thereto and the documents incorporated by
reference in the prospectus contained in such registration statement at
the time such part of such registration statement became effective but
excluding Form T-1, each as amended at the time such part of such
registration statement 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 terms of a particular issue of
the Securities (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 any applicable Pricing Supplement
filed in accordance with Section 4(a) hereof) in relation to Securities
sold pursuant to this Agreement, in the form filed or transmitted for
filing 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 (and as of the date of each acceptance referred to
in Section 4(9) hereof), 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,
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however, that this representation and warranty shall not apply to the
Statement of Eligibility of the Trustee on Form T-1 or to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by any Agent 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 in case of the Registration Statement and
any amendment thereto and as of the applicable filing date in the case
of 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 the Statement of Eligibility of the Trustee
on Form T-1 or to any statements or omissions made in reliance upon and
in conformity with information furnished in writing to the Company by
any Agent expressly for use in the Prospectus as amended or
supplemented to relate to a particular issuance of Securities;
(d) The Company and its material subsidiaries, taken as a
whole, have not sustained since the date of the latest audited
financial statements included or incorporated by reference in the
Prospectus any material loss or interference with their business, taken
as a whole, from fire, explosion, flood or other calamity, whether or
not covered by insurance, or from any labor dispute or court or
governmental action, order or decree, other than as set forth or
contemplated in the Prospectus; and, since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, there has not been any decrease in the capital stock
(except as a result of repurchases of shares of common stock pursuant
to the Company's publicly announced stock repurchase program) or
increase in the principal amount of long-term debt of the Company in
excess of [$50 million] or any material adverse change, or any
development which the Company has reasonable cause to believe will
involve a material adverse change, in the consolidated financial
position, stockholders' equity or results of operations of the Company
and its material subsidiaries, taken 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 Delaware,
with power and authority (corporate and other) 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
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other jurisdiction in which it owns or leases properties so as to
require such qualification, or is subject to no material liability or
disability by reason of the failure to be so qualified in any such
jurisdiction;
(f) The Company has authorized capital stock 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 shares of capital stock
of each material subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and all such
shares owned directly or indirectly by the Company are owned free and
clear of all liens, encumbrances, equities or claims;
(g) The Securities have been duly authorized, and, when issued
and delivered pursuant to this Agreement and any Terms Agreement, 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, which will be
substantially in the form filed as an exhibit to the Registration
Statement; the Indenture has been duly authorized by the Company and
qualified under the Trust Indenture Act and constitutes a valid and
legally binding instrument of the Company, enforceable against the
Company in accordance with its terms, subject, as to enforcement, to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to general
equity principles; the Indenture conforms, and the Securities of any
particular issuance of Securities will conform, in all material
respects to the descriptions thereof contained in the Prospectus as
amended or supplemented to relate to such issuance of Securities; and
this Agreement and any applicable Terms Agreement have been duly
authorized, executed and delivered by the Company;
(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 of any of the material terms or provisions
of, or constitute a default under, any material indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to which
the Company or any of its material subsidiaries is a party or by which
the Company or any of its material subsidiaries is bound or to which
any of the property or assets of the Company or any of its material
subsidiaries is subject, nor will such action result in any violation
of the provisions of the Restated Certificate of Incorporation or the
By-Laws of the Company or any statute or any order, rule or regulation
of any court or governmental agency or body having jurisdiction over
the Company or any of its material subsidiaries or any of their
properties; and no consent, approval,
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authorization, order, registration or qualification of or with any
court or governmental agency or body is required for the solicitation
of offers to purchase Securities, the issue and sale of the Securities
or the consummation by the Company of the transactions contemplated by
this Agreement, any Terms Agreement or the Indenture, except such as
have been, or will have been prior to the Commencement Date (as defined
in Section 3 hereof), obtained under the Act or the Trust Indenture Act
and such consents, approvals, authorizations, registrations or
qualifications as may be required under securities or Blue Sky laws of
any state or foreign jurisdiction in connection with the solicitation
by such Agent of offers to purchase Securities from the Company and
with purchases of Securities by such Agent as principal, as the case
may be, in each case in the manner contemplated hereby;
(i) Other than as set forth or contemplated in the Prospectus,
there are no legal or governmental proceedings pending to which the
Company or any of its material subsidiaries is a party or of which any
property of the Company or any of its material subsidiaries is the
subject which would reasonably be expected to individually or in the
aggregate have a material adverse effect on the consolidated financial
position, stockholders' equity or results of operations of the Company
and its consolidated subsidiaries; and, to the best of the Company's
knowledge, no such proceedings are expressly threatened or contemplated
by governmental authorities or expressly threatened by others;
(j) To the best of the Company's knowledge, KPMG Peat Marwick
LLP, who have certified certain financial statements of the Company and
its consolidated subsidiaries, are independent public accountants as
required by the Act and the rules and regulations of the Commission
thereunder; and
(k) Immediately after any sale of Securities by the Company
hereunder or under any Terms Agreement, the aggregate amount of
Securities which shall have been issued and sold by the Company
hereunder or under any Terms Agreement and of any debt securities of
the Company (other than such Securities) that shall have been issued
and sold pursuant to the Registration Statement will not exceed the
amount of debt securities registered under the Registration Statement.
(l) The Company has inventoried and assessed its operations
and that of its consolidated subsidiaries and has inventoried and
assessed and continues to inventory and assess any third parties with
which the Company or any of its consolidated subsidiaries has a
material relationship to evaluate the extent to which the business or
operations of the Company or any of its consolidated subsidiaries will
be affected by the Year 2000 Problem. As a result of such reviews, the
Company has no reason to expect, and does not expect, that the
financial impact of addressing internal Year 2000 Problems will be
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material to its consolidated financial position, results of operations
or cash flows. The "Year 2000 Problem" as used herein means any
significant risk that computer hardware or software used in the
receipt, transmission, processing, manipulation, storage, retrieval,
retransmission or other utilization of data or in the operation of
mechanical or electrical systems of any kind will not, in the case of
dates or time periods occurring after December 31, 1999, function at
least as effectively as in the case of dates or time periods occurring
prior to January 1, 2000.
2. (a) On the basis of the representations and warranties, and subject
to the terms and conditions herein set forth, each of the Agents hereby
severally and not jointly agrees, as agent of the Company, to use its reasonable
efforts to solicit and receive 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 reserves the right to offer
Securities for sale otherwise than to or through an Agent; PROVIDED, HOWEVER,
that so long as this Agreement is in effect the Company will not appoint any
other agent for the purpose of soliciting purchases of the Securities on a
continuous basis. It is understood, however, that if from time to time the
Company is approached by a prospective agent offering to solicit a specific
purchase of Securities, the Company may engage such agent with respect to such
specific purchase, provided that the Agents are given notice of such purchase
promptly, including the terms thereof and a copy of any agreement setting forth
the terms of engagement of such agent by the Company, in each case after the
purchase is agreed to. Each such agent is acting in connection with the
Securities individually and not collectively or jointly with the Agents. So long
as this Agreement shall remain in effect with respect to any Agent, the Company
shall not, without the consent of such Agent, solicit or accept offers to
purchase, or sell, any debt securities with a maturity at the time of original
issuance of 9 months or more except (i) pursuant to or as contemplated by this
Agreement or any Terms Agreement, (ii) pursuant to a private placement not
constituting a public offering under the Act or (iii) in connection with a firm
commitment underwriting pursuant to an underwriting agreement that does not
provide for a continuous offering of medium-term debt securities. However, the
Company reserves the right to sell, and may solicit and accept offers to
purchase, Securities directly on its own behalf, and, in the case of any such
sale not resulting from a solicitation made by any Agent, no commission will be
payable with respect to such sale. These provisions shall not limit Section 4(f)
hereof or any similar provision included in any Terms Agreement.
Procedural details relating to the issue and delivery of Securities,
the solicitation of offers to purchase Securities and the payment in each case
therefor shall be as set forth in the Administrative Procedure attached hereto
as Annex II as it may be amended from time to time by written agreement between
the Agents and the Company (the "Administrative Procedure"). The provisions of
the Administrative Procedure shall apply to all transactions contemplated
hereunder other than those made pursuant to a Terms
7
Agreement. Each Agent and the Company agree to perform the respective duties and
obligations specifically provided to be performed by each of them in the
Administrative Procedure. The Company will furnish to the Trustee a copy of the
Administrative Procedure as from time to time in effect.
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 notice 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
the Agents that such solicitation may be resumed. During such period, the
Company shall not be required to comply with the provisions of Sections 4(i),
4(j) and 4(k). Upon advising the Agents that such solicitation may be resumed,
however, the Company shall simultaneously provide the documents required to be
delivered by Sections 4(i), 4(j) and 4(k), and the Agents shall have no
obligation to solicit offers to purchase the Securities until such documents
have been received by the Agents. In addition, any failure by the Company to
comply with its obligations hereunder, including without limitation its
obligations to deliver the documents required by Sections 4(i), 4(j) and 4(k),
shall automatically terminate the Agents' obligations hereunder, including
without limitation its obligations to solicit offers to purchase the Securities
hereunder as agent or to purchase Securities hereunder as principal.
The Company agrees to pay each Agent a commission, at the time of
settlement of any sale of a Security by the Company as a result of a
solicitation made by such Agent, in an amount equal to the following applicable
percentage of the principal amount of such Security sold:
Commission (percentage of
aggregate principal amount
Range of Maturities of Securities sold)
From 9 months to less than 1 year................................. .125%
From 1 year to less than 18 months................................ .150%
From 18 months to less than 2 years............................... .200%
From 2 years to less than 3 years................................. .250%
From 3 years to less than 4 years................................. .350%
From 4 years to less than 5 years................................. .450%
From 5 years to less than 6 years................................. .500%
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From 6 years to less than 7 years................................. .550%
From 7 years to less than 10 years................................ .600%
From 10 years to less than 15 years............................... .625%
From 15 years to less than 20 years .............................. .700%
From 20 years to 30 years......................................... .750%
From more than 30 years to
less than 50 years.............................................. .875%
50 years and more................................................. 1.000%
(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 that 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. The commitment of any Agent to
purchase Securities as principal, whether pursuant to a Terms Agreement or
otherwise, shall be deemed to have been made on the basis of the representations
and warranties of the Company herein contained and shall be subject to the terms
and conditions herein set forth. Each Terms Agreement shall specify the
principal amount of Securities to be purchased by any 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 such Agent in
the reoffering of the Securities and the time and date and place of delivery of
and payment for such Securities. Such Terms Agreement shall also specify any
requirements for opinions of counsel, accountants' letters and officers'
certificates pursuant to Section 4 hereof. The Agents may engage the services of
any other broker or dealer in connection with the resale of the Notes purchased
by them as principal and may allow all or any portion of the discount received
in connection with such purchases from the Company to be retained by such
brokers and dealers.
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. 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.
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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 Administrative Procedure, is referred to herein as a "Time
of Delivery."
(c) Each Agent agrees, with respect to any Security denominated in a
currency other than U.S. dollars, as agent, directly or indirectly, not to
solicit offers to purchase, and as principal under any Terms Agreement or
otherwise, directly or indirectly, not to offer, sell or deliver, such Security
in, or to residents of, the country issuing such currency (or, if such Security
is denominated in a composite currency, in any country issuing a currency
comprising a portion of such composite currency), except as permitted by
applicable law.
3. The documents required to be delivered pursuant to Section 6 hereof
on the Commencement Date (as defined below) shall be delivered to the Agents at
the offices of ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co., ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, 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
Company but in no event shall be later than the day prior to the date on which
solicitation of offers to purchase Securities is commenced or on which any Terms
Agreement is executed (such time and date being referred to herein as the
"Commencement Date").
4. The Company covenants and agrees with each Agent:
(a) (i) To make no amendment or supplement to the Registration
Statement or the Prospectus (A) prior to the Commencement Date to which
any Agent shall reasonably object promptly after reasonable notice
thereof or (B) 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 to which any Agent party to such Terms
Agreement or so purchasing as principal shall reasonably object
promptly after reasonable notice thereof; (ii) to prepare, with respect
to any Securities to be sold through or to such 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) 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; (iii) to make no
amendment or supplement to the Registration Statement or Prospectus
(other than any Pricing Supplement, any supplement relating to an
offering of securities other than the Securities, or any periodic
report filed pursuant to the Exchange Act and incorporated by reference
in the Prospectus) at any time prior to having afforded each Agent a
reasonable opportunity to review and comment on it; (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
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connection with the offering or sale of the Securities, and during such
same period to advise such Agent, promptly after the Company receives
notice thereof, of the time when any amendment to the Registration
Statement has been filed or has become effective or any supplement to
the Prospectus or any amended Prospectus (other than any Pricing
Supplement that relates to Securities not purchased through or by such
Agent) 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 amendment
or supplement of the Registration Statement or Prospectus or for
additional information; and (v) in the event of the issuance of any
such stop order or of any such order preventing or suspending the use
of any such prospectus or suspending any such qualification at any time
when an Agent has purchased Securities from the Company hereunder as
principal that it has not yet resold, to use promptly its best efforts
to obtain its withdrawal;
(b) Promptly from time to time to take such action as such
Agent reasonably may request to qualify the Securities for offering and
sale under the securities laws of such jurisdictions as such Agent may
request and to comply with such laws so as to permit the continuance of
sales and dealings therein 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;
(c) To furnish such Agent with copies of the Registration
Statement and each amendment thereto, with copies of the Prospectus as
each time amended or supplemented, other than any Pricing Supplement
(except as provided in the Administrative Procedure), in the form in
which it is filed with the Commission pursuant to Rule 424 under the
Act, and with copies of the documents incorporated by reference
therein, all in such quantities as such Agent may reasonably request
from time to time; 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 such 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 during such same period 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
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Exchange Act or the Trust Indenture Act, to notify such Agent and
request such Agent, in its capacity as agent of the Company, to suspend
solicitation of offers to purchase Securities from the Company (and, if
so notified, such Agent shall cease such solicitations forthwith); and
if the Company shall decide to amend or supplement the Registration
Statement or the Prospectus as then amended or supplemented, to so
advise such 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 during
such same period such 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 securityholders 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 earnings 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 this Agreement is in effect with respect
to any Agent, to furnish to such Agent copies of all reports or other
communications (financial or other) furnished to stockholders, and
deliver to such Agent (i) as soon as they are available, copies of any
reports and financial statements filed with the Commission or any
national securities exchange on which any class of securities of the
Company is listed (except registration statements filed with the
Commission on Form S-8 and reports of the Company's employee benefit
plans filed with the Commission on Form 11-K); 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);
(f) That, from the date of any Terms Agreement with such Agent
or other agreement by such Agent to purchase Securities as principal
and continuing to and including the later of (i) the termination of
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
12
prior written consent of such Agent, offer, sell, contract to sell or
otherwise dispose of any debt securities of the Company which both
mature more than 9 months after such Time of Delivery and have terms
which are substantially similar to the Securities which are the subject
of such Terms Agreement or other agreement;
(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 execution and
delivery by the Company of a Terms Agreement with such Agent, shall be
deemed to be an affirmation to such Agent that the representations and
warranties of the Company contained in or made pursuant to this
Agreement are true and correct as of the date of such acceptance or of
such Terms Agreement, as the case may be, as though made at and as of
such date, and an undertaking that such representations and warranties
will be true and correct as of the settlement date for the Securities
relating to such acceptance or as of the Time of Delivery relating to
such sale, as the case may be, as though made at and as of 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 Company sells Securities to such Agent
as principal pursuant to a Terms Agreement and such 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;
(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 the
Company sells Securities to such Agent as principal pursuant to a Terms
Agreement and such Terms Agreement specifies the delivery of an opinion
under this Section 4(i) as a condition to the purchase of Securities
pursuant to such Terms Agreement, the Company shall furnish or cause to
be furnished forthwith to such Agent a written opinion of the General
Counsel of the Company, or other counsel for the Company satisfactory
to such Agent, dated the date of such amendment, supplement,
incorporation or Time of Delivery relating to such sale, as the case
may be, in form satisfactory to such Agent, to the effect that such
Agent may rely on the opinion of such counsel referred to in Section
6(c) hereof which was last furnished to such Agent to the same extent
as though it were dated the date of such letter authorizing reliance
(except that the statements in such last opinion shall be deemed to
13
relate to the Registration Statement and the Prospectus as amended and
supplemented to such date) or, in lieu of such opinion, an opinion of
the same tenor as the opinion of such counsel referred to in Section
6(c) hereof but modified to relate to the Registration Statement and
the Prospectus as amended and supplemented to such date;
(j) That each time the Registration Statement or the
Prospectus shall be amended or supplemented 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 accounting records, and each time the Company
sells Securities to such Agent as principal pursuant to a Terms
Agreement and such Terms Agreement specifies the delivery of a letter
under this Section 4(j) as a condition to the purchase of Securities
pursuant to such Terms Agreement, the Company shall cause the
independent certified public accountants who have certified the
financial statements of the Company and its subsidiaries included or
incorporated by reference in the Registration Statement forthwith to
furnish to such Agent a letter, dated the date of such amendment,
supplement, incorporation or Time of Delivery relating to such sale, as
the case may be, in form satisfactory to such Agent, 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, with respect to any financial
information or other matter, such letter may reconfirm as true and
correct at such date as though made at and as of such date, rather than
repeat, statements with respect to such financial information or other
matter made in the letter referred to in Section 6(d) hereof which was
last furnished to such Agent;
(k) 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 the
Company sells Securities to an Agent as principal pursuant to a Terms
Agreement and the applicable Terms Agreement specifies the delivery of
a certificate under this Section 4(k) as a condition to the purchase of
Securities pursuant to such Terms Agreement, the Company shall furnish
or cause to be furnished forthwith to such Agent a certificate, dated
the date of such supplement, amendment, incorporation or Time of
Delivery relating to such sale, as the case may be, in such form and
executed by such officers of the Company as shall be satisfactory to
such Agent, to the effect that the statements contained in the
certificate referred to in Section 6(g) hereof which
14
was last furnished to such Agent are true and correct 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 as
amended and supplemented to such date) or, in lieu of such certificate,
certificates of the same tenor as the certificates referred to in said
Section 6(g) but modified to relate to the Registration Statement and
the Prospectus as amended and supplemented to such date; and
(l) To offer to any person who has agreed to purchase
Securities as the result of an offer to purchase solicited by such
Agent the right to refuse to purchase and pay for such Securities if,
on the related settlement date fixed pursuant to the Administrative
Procedure, any condition set forth in Section 6(a), 6(e) or 6(f) 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(f), and
that such Agent shall have no duty or obligation whatsoever to exercise
the judgment permitted under such Sections 6(a), 6(e) and 6(f) on
behalf of any such person).
5. The Company covenants and agrees with each Agent 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, the Prospectus and any Pricing
Supplements and all other amendments and supplements thereto and the mailing and
delivering of copies thereof to such Agent; (ii) the reasonable fees and
expenses of counsel for the Agents in connection with the establishment of the
program contemplated hereby, any opinions to be rendered by such counsel
hereunder and 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 the fees and disbursements of counsel for the
Agents in connection with such qualification and in connection with the Blue Sky
and Legal Investment Surveys; (v) any fees charged by securities 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 any transfer or
paying agent of the Company and the fees and disbursements of counsel for any
Trustee or such agent in connection with any Indenture and the Securities; (ix)
any advertising expenses connected with the solicitation of offers to purchase
and the sale
15
of Securities so long as such advertising expenses have been approved in advance
by the Company; and (x) all other costs and expenses incident to the performance
of the Company's obligations hereunder which are not otherwise specifically
provided for in this Section. Except as provided in Sections 7 and 8 hereof,
each Agent shall pay all other expenses it incurs.
6. The obligation of any Agent, as agent of the Company, at any time
("Solicitation Time") to solicit offers to purchase the Securities and the
obligation of any Agent to purchase Securities as principal, pursuant to any
Terms Agreement or otherwise, shall in each case be subject, in such Agent's
discretion, 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 in such Terms Agreement by
reference) are true and correct at and as of the Commencement Date and any
applicable date referred to in Section 4(k) hereof that is prior to such
Solicitation Time or Time of Delivery, as the case may be, and at and as of such
Solicitation Time or Time of Delivery, as the case may be, the condition that
prior to such Solicitation Time or Time of Delivery, as the case may be, the
Company shall have performed all of its obligations hereunder theretofore to be
performed, and the following additional conditions:
(a) (i) With respect to any Securities sold at or prior to
such Solicitation Time or Time of Delivery, as the case may be, the
Prospectus as amended or supplemented (including the Pricing
Supplement) with respect to such 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 Section 4(a) hereof;
(ii) no stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceeding for that purpose
shall have been initiated or expressly threatened by the Commission;
and (iii) all requests for additional information on the part of the
Commission shall have been complied with to the reasonable satisfaction
of such Agent;
(b) ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel to the Agents, shall have
furnished to such Agent (i) such opinion or opinions, dated the
Commencement 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 such Agent 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(h) hereof that is on or prior to such
Solicitation Time or Time of Delivery, as the case may be, an opinion
or opinions, dated such applicable date, to the effect that such Agent
may rely on the opinion or opinions which were last furnished to such
Agent 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
16
shall be deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented 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 as
amended and supplemented to such date; and in each case such counsel
shall have received such papers and information as they may reasonably
request to enable them to pass upon such matters;
(c) The General Counsel of the Company, or other counsel for
the Company satisfactory to such Agent, shall have furnished to such
Agent his, her or their written opinion, dated the Commencement Date
and each applicable date referred to in Section 4(i) hereof that is on
or prior to such Solicitation Time or Time of Delivery, as the case may
be, in form and substance satisfactory to such Agent, 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 jurisdiction of its incorporation, with power and
authority (corporate and other) to own its properties and
conduct its business as described in the Prospectus as amended
or supplemented;
(ii) The Company has authorized capital stock 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 and other than
as set forth or contemplated in the Prospectus, there are no
legal or governmental proceedings pending to which the Company
or any of its consolidated subsidiaries is a party or to which
any property of the Company or any of its consolidated
subsidiaries is the subject which would reasonably be expected
to individually or in the aggregate have a material adverse
effect on the consolidated financial position, stockholders'
equity or results of operations of the Company and its
consolidated subsidiaries; and, to the best of such counsel's
knowledge, no such proceedings are expressly threatened or
contemplated by governmental authorities or expressly
threatened by others;
(iv) This Agreement and any applicable Terms Agreement have
been duly authorized, executed and delivered by the Company;
(v) The Securities have been duly authorized and, when duly
executed, authenticated, issued and delivered by the Company,
will constitute valid and legally binding obligations of the
Company entitled to
17
the benefits provided by the Indenture; and the Indenture
conforms and the Securities will conform in all material
respects 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, assuming due authorization,
execution and delivery by the Trustee, constitutes a valid and
legally binding instrument of the Company, enforceable against
the Company in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization and
other laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and the
Indenture has been duly qualified under the Trust Indenture
Act;
(vii) The issue and sale of the Securities, the compliance by
the Company with all of the provisions of the Securities, the
Indenture, this Agreement and any applicable 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 material terms or provisions of, or constitute a
default under, any material indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known
to such counsel to which the Company or any of its
consolidated subsidiaries is a party or by which the Company
or any of its consolidated subsidiaries is bound or to which
any of the property or assets of the Company or any of its
consolidated subsidiaries is subject, nor will such action
result in any violation of the provisions of the Restated
Certificate of Incorporation, as amended, of the Company or
the By-Laws of the Company or any statute or any order, rule
or regulation known to such counsel of any court or
governmental agency or body having jurisdiction over the
Company or any of its consolidated subsidiaries or any of
their material properties;
(viii) No consent, approval, authorization, order,
registration or qualification of or with any court or
governmental agency or body is required for the solicitation
of offers to purchase Securities, the issue and sale of the
Securities or the consummation by the Company of the other
transactions contemplated by this Agreement, 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 securities or Blue Sky
laws of any state or foreign jurisdiction in connection with
the solicitation by the Agents of offers to purchase
Securities from the Company and with purchases of Securities
by an Agent as principal, as the case may be, in each case in
the manner contemplated hereby;
18
(ix) The documents incorporated by reference in the Prospectus
as amended or supplemented (other than the financial
statements and financial data 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 such counsel 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, or, 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
and 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 financial data and
related schedules therein, as to which such counsel need
express no opinion) comply as to form in all material respects
with the requirements of the Act and the Trust Indenture Act
and the rules and regulations thereunder; although such
counsel does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the
Registration Statement or the Prospectus, except for those
referred to in the opinion in subsection (v) of this Section
6(c), such counsel has no reason to believe that, as of its
effective date, the Registration Statement or any amendment or
supplement thereto made by the Company prior to the date of
such opinion (other than the financial statements and
financial data and related schedules therein, as to which such
counsel need express no opinion) 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 or that, as of the date of
such opinion, the Prospectus as amended or supplemented (other
than the financial statements and financial data and related
schedules therein, as to which such counsel need express no
opinion) contains an untrue statement of a material fact or
omits to state a material fact required to be stated therein
or necessary to make the statements therein not misleading;
and such counsel does not know of any amendment to the
Registration Statement required to be filed or any contracts
or other documents of a character
19
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.
(d) Not later than 10:00 a.m., New York City time, on the
Commencement Date and on each applicable date referred to in Section
4(j) hereof that is on or prior to such Solicitation Time or Time of
Delivery, as the case may be, the independent certified public
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 such Agent a letter,
dated the Commencement Date or such applicable date, as the case may
be, in form and substance satisfactory to such Agent, to the effect set
forth in Annex III hereto;
(e) (i) The Company and its material subsidiaries, taken as a
whole, shall not have sustained since the date of the latest audited
financial statements included or incorporated by reference in the
Prospectus, as amended or supplemented, any loss or interference with
their business, taken as a whole, from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, other than as
set forth or contemplated in the Prospectus as amended or supplemented
and (ii) since the respective dates as of which information is given in
the Prospectus as amended or supplemented there shall not have been any
decrease in the capital stock (except as a result of repurchases of
shares of common stock pursuant to the Company's publicly announced
stock repurchase program) or increases in long-term debt of the Company
or any of its subsidiaries in excess of $60 million or any material
adverse change, or any development which is reasonably likely to
involve a material adverse change, in the consolidated financial
position, stockholders' equity or results of operations of the Company
and its material subsidiaries, taken as a whole, otherwise than as set
forth or contemplated in the Prospectus as amended or supplemented, the
effect of which, in any such case described in clause (i) or (ii), is
in the reasonable judgment of such Agent so material and adverse as to
make it impracticable or inadvisable to proceed with the solicitation
by such Agent of offers to purchase Securities from the Company or the
purchase by such Agent of Securities from the Company as principal, as
the case may be, on the terms and in the manner contemplated in the
Prospectus as amended or supplemented;
(f) There shall not have occurred any of the following: (i) a
material suspension or material limitation in trading in securities
generally or in trading in securities of the Company on the New York
Stock Exchange; (ii) a general
20
moratorium on commercial banking activities in New York declared by
either Federal or New York State authorities; (iii) the outbreak or
escalation of hostilities directly involving the United States or the
declaration by the United States of a national emergency or war, if the
effect of any such event specified in this clause (iii) in the
reasonable judgment of such Agent makes it impracticable or inadvisable
to proceed with the solicitation of offers to purchase Securities or
the purchase of Securities from the Company as principal, pursuant to
the applicable Terms Agreement or otherwise, as the case may be, on the
terms and in the manner contemplated in the Prospectus as amended or
supplemented; or (iv) any downgrading in the rating accorded the
Company's long-term debt securities by any "nationally recognized
statistical rating organization," as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act or a public
announcement by any such organization that it has under surveillance or
review, with possible negative implications, its rating of any such
debt securities;
(g) The Company shall have furnished or caused to be furnished
to such Agent certificates of officers of the Company dated the
Commencement Date and each applicable date referred to in Section 4(k)
hereof that is on or prior to such Solicitation Time or Time of
Delivery, as the case may be, in such form and executed by such
officers of the Company as shall be satisfactory to such Agent, as to
the accuracy of the representations and warranties of the Company
herein at and as of the Commencement Date or such applicable date, as
the case may be, as to the performance by the Company of all of its
obligations hereunder to be performed at or prior to the Commencement
Date or such applicable date, as the case may be, as to the matters set
forth in subsections (a) and (e) of this Section 6, and as to such
other matters as such Agent may reasonably request; and
(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.
21
7. (a) The Company will 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 statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, 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 such Agent for any legal or other
out-of-pocket expenses reasonably incurred by it in connection with
investigating or defending any such action or claim as such expenses are
incurred; 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, 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 PROVIDED, FURTHER, that the
foregoing indemnity with respect to any Preliminary Prospectuses shall not inure
to the benefit of any Agent (or to the benefit of any person controlling such
Agent) from whom the person asserting any such losses, claims, damages or
liabilities purchased Securities if such untrue statement or omission or alleged
untrue statement or omission made in any Preliminary Prospectus is eliminated or
remedied in the Prospectus which is required to be delivered pursuant to the Act
and a factual determination has been made that a copy of the Prospectus
(excluding documents incorporated by reference) has not been sent or delivered
to such person at or prior to the written confirmation of the sale of such
Securities to such person.
(b) Each Agent will 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, 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, 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
22
therein; and will reimburse the Company for any legal or other out-of-pocket
expenses reasonably incurred by the Company in connection with investigating or
defending any such action or claim as such expenses are incurred.
(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; 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 reasonably 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 out-of-pocket expenses, in each case
subsequently incurred by such indemnified party, in connection with the defense
thereof other than reasonable costs of investigation.
(d) If the indemnification provided for in this Section 7 is
unavailable to or insufficient to hold harmless 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 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 each Agent 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 each Agent 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 such Agent 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
23
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 any Agent 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
each Agent agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by per capita allocation (even
if all 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 out-of-pocket 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), an Agent
shall not 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
it 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 meaning of the Act; and the obligations of each Agent 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. Each Agent, in soliciting offers to purchase Securities from the
Company and in performing the other obligations of such Agent hereunder (other
than in respect of any purchase by an Agent as principal, pursuant to a Terms
Agreement or otherwise), is acting solely as agent for the Company and not as
principal. Each Agent will make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer to purchase Securities from
the Company was solicited by such Agent and has been accepted by the Company,
but such Agent shall not have any liability to the Company in the event such
purchase is not consummated for any reason. If the Company shall default on its
obligation to deliver Securities to a purchaser whose offer it has accepted, the
Company shall (i) hold each Agent harmless against any loss, claim or damage
arising from or as a result of such default by the Company and (ii)
24
notwithstanding such default, pay to the Agent that solicited such offer any
commission to which it would be entitled in connection with such sale.
9. The respective indemnities, agreements, representations, warranties
and other statements by any Agent and the Company set forth in or made 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 any Agent or any controlling person of any Agent, or the Company, or any
officer or director or any controlling person of the Company, 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 Securities from the Company may be suspended or terminated at
any time by the Company as to any Agent or by any Agent as to such Agent upon
the giving of written notice of such suspension or termination to such Agent or
the Company, as the case may be. In the event of such suspension or termination
with respect to any Agent, (x) this Agreement shall remain in full force and
effect with respect to any Agent as to which such suspension or termination has
not occurred, (y) this Agreement shall remain in full force and effect with
respect to the rights and obligations of any party which have previously accrued
or which relate to Securities which are already issued, agreed to be issued or
the subject of a pending offer at the time of such suspension or termination and
(z) in any event, this Agreement shall remain in full force and effect insofar
as the fourth paragraph of Section 2(a), Section 4(d), Section 4(e), Section 5,
Section 7, Section 8 and Section 9 hereof are concerned.
11. Except as otherwise specifically provided herein or in the
Administrative Procedure, all statements, requests, notices and advice hereunder
shall be in writing, or by telephone if promptly confirmed in writing, and, if
to ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co., shall be sufficient in all respects when delivered or
sent by facsimile transmission, overnight express service or certified mail to
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Facsimile Transmission No. (212)
902-4103, Attention: Registration Department; and, if to ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.,
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, shall be sufficient in all
respects when delivered or sent by facsimile transmission, overnight express
service or certified mail to ▇▇▇▇▇▇▇ ▇▇▇▇▇ World Headquarters, World Financial
Center, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: MTN
Product Management, Facsimile Transmission No. (▇▇▇) ▇▇▇-▇▇▇▇; and, if to ▇.▇.
▇▇▇▇▇▇ Securities Inc., shall be sufficient in all respects when delivered or
sent by facsimile transmission, overnight express service or certified mail to
▇.▇. ▇▇▇▇▇▇ Securities Inc., ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Facsimile Transmission No. (▇▇▇) ▇▇▇-▇▇▇▇, Attention: Medium-Term Note
Desk, and, if to . ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, shall be sufficient in all
respects when delivered or sent by facsimile transmission, overnight express
service or certified mail to:
25
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Manager - Continuously Offered Products
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇ - Investment Banking Information Center
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
and, if to ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc., shall be sufficient in all respects when
delivered or sent by facsimile transmission, overnight express service or
certified mail to ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc., ▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, Facsimile Transmission No. (▇▇▇) ▇▇▇-▇▇▇▇, Attention: Medium-Term
Note Department; and, if to Warburg Dillon Read LLC., shall be sufficient in all
respects when delivered or sent by facsimile transmission, overnight express
service or certified mail to Warburg Dillon Read LLC, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Facsimile Transmission No. (▇▇▇) ▇▇▇-▇▇▇▇, Attention:
Syndicate Department; and, if to the Company, shall be sufficient in all
respects when delivered or sent by facsimile transmission, overnight express
service or certified mail to General ▇▇▇▇▇, Inc., Number ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Facsimile Transmission No. (612)
540-4925, Attention: Director, Corporate Finance.
12. This Agreement and any Terms Agreement shall be binding upon, and
inure solely to the benefit of, each Agent 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 their respective personal representatives, 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 purchaser of any of the Securities through
or from any Agent hereunder shall be deemed a successor or assign by reason of
such purchase.
13. Time shall be of the essence in this Agreement and any Terms
Agreement. As used herein, the term "business day" shall mean any day when the
office of the Commission in Washington, D.C. is normally open for business.
26
14. This Agreement and any Terms Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
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.
27
If the foregoing is in accordance with your understanding, please sign
and return to us five counterparts thereof, whereupon this letter and the
acceptance by each of you shall constitute a binding agreement between the
Company and each of you in accordance with its terms.
Very truly yours,
GENERAL ▇▇▇▇▇, INC.
By:
-------------
Accepted in New York, New York, as of the date hereof:
▇▇▇▇▇▇▇, SACHS & CO.
By:
------------------------
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ &
▇▇▇▇▇ INCORPORATED
By:
---------------------
▇.▇. ▇▇▇▇▇▇ SECURITIES INC.
By:
------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
By:
------------------------
28
▇▇▇▇▇▇▇ ▇▇▇▇▇ BARNEY INC.
By:
------------------------
WARBURG DILLON READ LLC
By:
------------------------
29
ANNEX I
GENERAL ▇▇▇▇▇, INC.
Medium-Term Notes, Series F
Terms Agreement
------------, [----]
[▇▇▇▇▇▇▇, Sachs & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇]
[▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.,
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated,
▇▇▇▇▇▇▇ ▇▇▇▇▇ World Headquarters,
World Financial Center,
New York, New York 10281]
[▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ]
[▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇]
[▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇]
[Warburg Dillon Read LLC
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇]
Ladies and Gentlemen:
General ▇▇▇▇▇, Inc. (the "Company") proposes, subject to the terms
and conditions stated herein and in the Distribution Agreement, dated
February 28, 1996 (the "Distribution Agreement"), between the Company on the
one hand and ▇▇▇▇▇▇▇, Sachs & Co., ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch,
Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated, ▇.▇. ▇▇▇▇▇▇ Securities Inc., ▇▇▇▇▇▇
▇▇▇▇▇▇▇ & Co. Incorporated, ▇▇▇▇▇▇▇ ▇▇▇▇▇
30
NY12532: 256469.4
Barney Inc., and Warburg Dillon Read LLC (the "Agents") on the other, to issue
and sell to [▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.][,] [and] [▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch,
Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated], [▇.▇. ▇▇▇▇▇▇ Securities Inc.] [,]
[and][▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated] [,] [▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.] [and]
[Warburg Dillon Read LLC] 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 Terms 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 Terms 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 in Section 1 of the Distribution Agreement which
makes reference to the Prospectus 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 a 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 [▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.] [,][and] [▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇
Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated] [and] [▇.▇. ▇▇▇▇▇▇ Securities Inc.]
[,] [and] [▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated] [,] [and] [▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney
Inc.] [,] [and] [Warburg Dillon Read LLC] [,] [and] [▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.]
[,][and] [▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated] [,] [and] [▇.▇. ▇▇▇▇▇▇ Securities Inc.] [,] [and] [▇▇▇▇▇▇ ▇▇▇▇▇▇▇
& Co. Incorporated] [,] [and] [▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.] [,] [and] [Warburg
Dillon Read LLC] 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.
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 you and the Company.
31
NY12532: 256469.4
GENERAL ▇▇▇▇▇, INC.
By
-----------------
Accepted:
[▇▇▇▇▇▇▇, SACHS & CO.]
By:
------------------------
[▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ &
▇▇▇▇▇ INCORPORATED]
By:
------------------------
[▇.▇. ▇▇▇▇▇▇ SECURITIES INC.]
By:
------------------------
[▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED]
By:
------------------------
[▇▇▇▇▇▇▇ ▇▇▇▇▇ BARNEY INC.]
By:
------------------------
[WARBURG DILLON READ LLC]
By:
------------------------
32
NY12532: 256469.4
Schedule to Annex I
TITLE OF PURCHASED SECURITIES:
[ %] [Medium-Term Notes]
SPECIFIED CURRENCY (IF OTHER THAN U.S. DOLLARS):
AGGREGATE PRINCIPAL AMOUNT:
[$ or units of the Specified Currency indicated above] [Price
to Public]
PURCHASE PRICE BY [▇▇▇▇▇▇▇, ▇▇▇▇▇ & CO.] [,] [AND] [▇▇▇▇▇▇▇ ▇▇▇▇▇ & CO., ▇▇▇▇▇▇▇
LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED] [,] [▇.▇. ▇▇▇▇▇▇ SECURITIES INC.]
[AND] [,] [AND] [▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED] [,] [AND] [▇▇▇▇▇▇▇ ▇▇▇▇▇
BARNEY INC.] [,] [AND] [WARBURG DILLON READ LLC.] :
[ %] 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:
[By Certified or official bank check or checks, payable to the order of
the Company, in [[New York] Clearing House] [immediately available] funds]
[By wire transfer to a bank account specified by the Company in [next
day] [immediately available] funds]
INDENTURE:
Indenture, dated as of [ ], as supplemented, between
the Company and First Trust Illinois, National Association, as Trustee
FORM OF PURCHASED SECURITIES:
[Registered form only] [Temporary global security, to be followed by
definitive securities in registered form] [Global form only]
TIME OF DELIVERY:
CLOSING LOCATION:
I-1
NY12532: 256469.4
MATURITY:
DENOMINATIONS (IF OTHER THAN U.S. DOLLARS):
INTEREST RATE:
[Fixed Rate Note: %]
[Floating Rate Note:
Interest Rate Basis:
Index Maturity:
Spread or Spread Multiplier:
Maximum Rate: %
Minimum Rate: %
Initial Interest Rate: %
Interest Reset Dates:
Calculation Dates:
Interest Determination Dates:
Record Dates:
Calculation Agent
(if other than First Trust of Illinois, National Association):]
INTEREST PAYMENT DATES:
[months and dates]
[INDEXED NOTE:
Indexed Currency or Commodity:
Base Rate:]
DOCUMENTS TO BE DELIVERED:
The following documents referred to in the Distribution Agreement shall
be delivered as a condition to the Closing:
[(1) The opinion or opinions of counsel to the Agents referred to in
Section 4(h). ]
[(2) The opinion of counsel to the Company referred to in Section 4(i).]
[(3) The accountants' letter referred to in Section 4(j).]
[(4) The officers' certificate referred to in Section 4(k).]
OTHER PROVISIONS (INCLUDING SYNDICATE PROVISIONS, IF APPLICABLE):
I-2
NY12532: 256469.4
ANNEX II
GENERAL ▇▇▇▇▇, INC.
ADMINISTRATIVE PROCEDURE
This Administrative Procedure relates to the Securities defined in the
Distribution Agreement, dated ___________ ___, 1999 (the "Distribution
Agreement"), between General ▇▇▇▇▇, Inc. (the "Company") and ▇▇▇▇▇▇▇, ▇▇▇▇▇ &
Co., ▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co., ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated,
▇.▇. ▇▇▇▇▇▇ Securities Inc., ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Barney Inc., and Warburg Dillon Read LLC (together, 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 as amended
or supplemented. To the extent any procedure set forth below conflicts with the
provisions of the Securities, the Indenture or the Distribution Agreement, the
relevant provisions of the Securities, the Indenture and the Distribution
Agreement shall control.
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 below 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 Securities 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 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
represented by either a global certificate (a "Global Certificate") delivered to
the Trustee, as agent for The Depository Trust Company (the "Depositary") and
recorded in the book-entry system maintained by the Depositary (a "Book-Entry
Note") or a certificate (a "Definitive Certificate") delivered to a person
designated by an Agent.
II-1
The Company has appointed First Trust of Illinois, National
Association, as trustee under the Indenture (the "Trustee"), as Calculation
Agent (the "Calculation Agent") and as Exchange Rate Agent (the "Exchange Rate
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 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 Note, the interest rate;
(3) Maturity Date;
(4) Specified Currency and, if the Specified Currency is other than
U.S. dollars, the applicable Exchange Rate for such Specified
Currency;
II-2
(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 by either the Company or a Holder, such
of the following as are applicable:
(i) Redemption Commencement Date,
(ii) Initial Redemption Price (% of par),
(iii) Amount (% of par) that the Redemption Price shall
decline (but not below par) on each anniversary of
the Redemption Commencement Date, and
(iv) the last date on which any such right of redemption
may be exercised;
(10) If a Floating Rate Note, 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 Reset Dates,
(viii) Calculation Dates,
(ix) Interest Determination Dates,
(x) Interest Payment Dates,
(xi) Regular Record Dates, and
(xii) Calculation Agent;
(11) If the amount of principal payable on a Security will be
determined by reference to an index or formula, a full description of such index
or formula;
(12) If an OID Note, the total amount of OID, the Yield to Maturity and
the initial accrual period of OID;
(13) Name, address and taxpayer identification number of the
registered owner;
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(14) Denomination of certificates to be delivered at settlement;
and
(15) Global Certificate or Definitive Certificate.
PREPARATION OF PRICING SUPPLEMENT BY COMPANY:
If the Company accepts an offer to purchase a Security, it will prepare
a Pricing Supplement. Provided the Selling Agent or Purchasing Agent, as the
case may be, supplies to the Company, by facsimile transmission any information
needed by the Company prior to 5:00 p.m., New York City time, on the date of
acceptance of the offer, the Company will supply, by facsimile transmission, a
copy of the Pricing Supplement to the Selling Agent or Purchasing Agent, as the
case may be, not later than 10:00 a.m., New York City time, on the business day
in New York following the date of acceptance of such offer.
If ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. is Selling Agent or Purchasing Agent, deliveries of the
Pricing Supplement should be made to:
▇▇▇▇▇▇▇, Sachs & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Medium-Term Note Trading Desk
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopies: (▇▇▇) ▇▇▇-▇▇▇▇
In addition, if ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated is Selling
Agent or Purchasing Agent, the Company will deliver a completed Pricing
Supplement, via facsimile transmission or next day mail or to arrive no later
than 11:00 a.m. on the Business Day following the trade date, to the Presenting
Agent at the following locations:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.:
For overnight, express, or special delivery packages ONLY:
Tritech Services
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Prospectus Operations/▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇/2775/2776
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also, for record keeping purposes, please send a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇▇ & Co.
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
World Financial Center, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: MTN Product Management
Tel: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If ▇.▇. ▇▇▇▇▇▇ Securities Inc. is Selling Agent or Purchasing Agent, deliveries
of the Pricing Supplement should be made to
▇.▇. ▇▇▇▇▇▇ Securities Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Medium-Term Note Desk
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated is Selling Agent or Purchasing Agent,
deliveries of the Pricing Supplement should be made to:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: Medium-Term Note Trading Desk, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopies: (▇▇▇) ▇▇▇-▇▇▇▇
If ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. is Selling Agent or Purchasing Agent, deliveries of
the Pricing Supplement should be made to:
▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney Inc.
Brooklyn Army terminal
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
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Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
If Warburg Dillon Read LLC is Selling Agent or Purchasing Agent, deliveries of
the Pricing Supplement should be made to :
Warburg Dillon Read LLC
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Syndicate Desk
The Company will arrange to have the Pricing Supplement filed with the
Commission by electronic submission 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.
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 Depositary'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.
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 electronic or written means.
The Company will instruct the Trustee by facsimile transmission or
other acceptable electronic or 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
II-6
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 10:00 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.
With respect to Definitive Certificates, upon receiving the Sale
Information from the Selling Agent or the Purchasing Agent, as the case may be,
the Trustee will obtain a CUSIP number from the CUSIP Service Bureau for
assignment to the Definitive Certificates representing the Notes. Such CUSIP
number must be obtained by 12:00 noon on the trade date; or, if a sale is to be
settled more than one Business Day after the trade date, by 12:00 noon on the
first Business Day after such sale date; or, if a sale of a Floating Rate Note
is to be settled more than one Business Day after the trade date and the initial
interest rate for the Floating Rate Note is not known at the time that the Sale
Information is received, by 11:00 a.m. on the second Business Day before the
Settlement Date.
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, deliver the Securities 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 purchase or carry any margin securities in
violation of Regulations G, T, U or X of the Federal Reserve Board or otherwise
in violation of law.
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, deliver the
Securities to the Purchasing Agent against delivery 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, the Selling Agent will promptly notify the
Trustee and the Company thereof by telephone (confirmed in writing) or by
facsimile transmission or other acceptable written means. The Selling Agent will
immediately return the Security
II-7
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.
BUSINESS DAY:
"Business Day" means (1) with respect to any Note, each Monday,
Tuesday, Wednesday, Thursday and Friday which, is (a) not a day on which banking
institutions in The City of New York generally are authorized or obligated by
law, regulation or executive order to close, and (b) if the Note is denominated
in a Specified Currency other than United States dollars not a day on which
banking institutions are authorized or obligated by law, regulation or executive
order to close in the financial center of the country issuing the Specified
Currency, and (2) with respect to LIBOR Notes only, any such Business Day which
is also a London Business Day. As used in the preceding sentence, "financial
center" means the capital city of the country issuing the Specified Currency
except that with respect to United States dollars, Australian dollars, Canadian
dollars, Deutsche marks, Dutch guilders, Italian lire and Swiss francs, the
"financial center" shall be the City of New York, Sydney, Toronto, Frankfurt,
Amsterdam, Milan and Zurich, respectively, and with respect to the lawful
currency of the member states of the European Union that adopt the single
currency in accordance with the Treaty establishing the European Community, as
amended by the Treaty on European Union (the "Euro"), the "financial center"
shall be London and Luxembourg. "London Business Day" means any day (a) if the
LIBOR Currency is other than the Euro, on which dealings in deposits in such
LIBOR Currency are transacted in the London interbank market or (b) if the LIBOR
Currency is the Euro, any day on which the Trans-European Automated Real-Time
Gross Settlement Express Transfer (TARGET) System is open. "LIBOR Currency"
means, with respect to any Notes, the currency (including composite currencies)
specified in the Pricing Supplement applicable to such Notes as the currency for
which LIBOR shall be calculated; provided, that if no such currency is specified
in such Pricing Supplement, the LIBOR Currency shall be United States dollars.
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 Depositary, the Trustee
will perform the custodial, document control and administrative functions
described below, in accordance with its respective obligations under a Letter of
Representations from the Company and the
II-8
Trustee to the Depositary, dated February 28, 1996, and a Medium-Term Note
Certificate Agreement entered between the Trustee and the Depositary (the
"Certificate Agreement"), and the Trustee's obligations as a participant in the
Depositary, including the Depositary'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 Depositary (each a "Participant") in accordance with the
Depositary's customary practices and reflected in the records of such
Participants or one or more indirect participants in the Depositary designated
by such purchasers in accordance with the arrangements between such purchasers
and such Participants and indirect participants.
ISSUANCE: All Fixed Rate Notes which are Book-Entry Securities and have
the same Original Issue Date, redemption provisions, repayment provisions,
Interest Payment Dates, interest rate, interest payment periods, Specified
Currency 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 Notes which are Book-Entry Securities and
have the same Original Issue Date, redemption provisions, repayment provisions,
Interest Payment Dates, interest payment periods, Interest Rate Basis, Initial
Interest Rate, Index Maturity, Spread or Spread Multiplier, if any, Minimum
Interest Rate, if any, Maximum Interest Rate, if any, Specified Currency 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 Notes which are Book-Entry Securities and have the
same Original Issue Date, redemption provisions, 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 reservation of
approximately 900 CUSIP numbers which have been reserved for and relating to
Book-Entry Securities, and the Company has delivered to the Trustee and the
Depositary such list of such CUSIP numbers. The Company will assign CUSIP
numbers to Book-Entry Securities as described below under Settlement Procedure
B. The Depositary will notify the CUSIP Service Bureau periodically of the CUSIP
numbers that the Company has assigned to Book-Entry Securities. The Company
will, at any time it deems necessary, 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 Depositary. Book-Entry Securities having an aggregate principal
amount in excess of $200,000,000 will be represented by two or more Global
Certificates which shall all be assigned the same CUSIP number.
REGISTRATION: Each Global Certificate will be registered in the name of
Cede & Co., as nominee for the Depositary, on the register maintained by the
Trustee under the Indenture. On the first Business Day of each month, the
Trustee will deliver to the
II-9
NY12532: 256469.4
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 Depositary) 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 Depositary.
EXCHANGES: The Trustee may deliver to the Depositary and the CUSIP
Service Bureau at any time a written notice specifying (a) the CUSIP numbers of
two or more Global Certificates for outstanding Book-Entry Securities 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), and for which
interest (if any) has been paid to the same date; (b) a date, occurring at least
30 days after such written notice is delivered and at least 30 days before the
next Interest Payment Date (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 Depositary 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 canceled and not immediately 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).
DENOMINATIONS: Unless otherwise specified in the applicable Pricing
Supplement, Book-Entry Securities will be issued in denominations of $1,000 and
any integral multiples 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
II-10
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 Depositary 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 Notes on 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 Trustee will
deliver to the Company and the Depositary 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 Trustee 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 each Regular Record Date, the Trustee will deliver to the Company and the
Depositary 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 Stated
Maturity) and the total of such amounts. The Depositary 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 Trustee, as Paying
Agent, and the Trustee in turn will pay to the Depositary, such total amount of
interest due (other than at Stated Maturity), at the times and in the manner set
forth below under "Manner of Payment."
PAYMENTS AT STATED MATURITY. On or about the first Business Day of each
month, the Trustee will deliver to the Company and the Depositary a written list
of principal, premium, if any, and interest to be paid on each Book-Entry
Security maturing either at Stated Maturity or on a Redemption Date or repayment
date in the following month.
The Trustee, the Company and the Depositary 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 Stated
Maturity of such Book-Entry Security. At such Stated Maturity, the Company will
pay to the Trustee, and the Trustee in turn will pay to the Depositary, the
principal amount of such Book-Entry Security, together with interest and
premium, if any, due at such Stated Maturity, at the times and in the manner set
forth below under "Manner of Payment." Promptly after payment to the Depositary
of the principal, interest and premium, if any, due at the Stated Maturity of
all Book-Entry Securities represented by a particular Global Certificate, the
Trustee will cancel such Global Certificate, make appropriate entries in
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its records and, unless otherwise instructed by the Company, destroy 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 Stated
Maturity shall be paid by the Company to the Trustee, as Paying Agent, in funds
immediately available for use by the Trustee as of 9:30 a.m., New York City
time, on such date. The Company will make such payment on such Book-Entry
Securities by wire transfer to the Trustee or by instructing the Trustee to
withdraw funds from an account maintained by the Company at the Trustee. The
Company will confirm such instructions in writing to the Trustee. For maturity,
redemption and other principal payments, prior to 10:00 a.m., New York City
time, on each Stated Maturity or other such date or as soon as possible
thereafter, the Trustee will pay by separate wire transfer (using Fedwire
message entry instructions in a form previously specified by the Depositary) to
an account at the Federal Reserve Bank of New York previously specified by the
Depositary, in funds available for immediate use by the Depositary, each payment
of interest, principal and premium, if any, due on Book-Entry Securities on such
date; and for interest payments, the Trustee will pay the Depositary in same day
funds on the Interest Payment Date in accordance with existing arrangements
between the Trustee and the Depositary. Thereafter on each such date, the
Depositary will pay, in accordance with its SDFS operating procedures then in
effect, such amounts in funds available for immediate use to the respective
Participants in whose names such Book-Entry Securities are recorded in the
book-entry system maintained by the Depositary. Once payment has been made to
the Depositary, neither the Company nor the Trustee shall have any
responsibility or liability for the payment by the Depositary 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, 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 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 Note, the interest rate;
II-12
(3) Stated Maturity;
(4) Specified Currency and, if the Specified Currency is
other than U.S. dollars, the applicable exchange rate
for such Specified Currency;
(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 by either the Company or a
holder, such of the following as are applicable:
(i) Redemption Commencement Date,
(ii) Initial Redemption Price (% of par),
(iii) Amount (% of par) that the Redemption Price
shall decline (but not below par) on each
anniversary of the Redemption Commencement
Date, and
(iv) The last date on which any such right of
redemption may be exercised;
(10) If a Floating Rate Note, such of the following as are
applicable:
(i) Interest Rate Basis,
(ii) Index Maturity,
(iii) Spread or Spread Multiplier,
(iv) Maximum Interest Rate,
(v) Minimum Interest Rate,
(vi) Initial Interest Rate,
(vii) Interest Rate Reset Period,
(viii) Calculation Dates,
(ix) Interest Calculation Dates,
(x) Interest Payment Dates,
(xi) Regular Record Dates, and
(xii) Calculation Agent;
(11) If the amount of principal payable on a Security will
be determined by reference to an index or formula, a
full description of such index or formula;
II-13
(12) If an OID Note, the total amount of OID, the Yield to
Maturity and the initial accrual period of OID;
(13) The taxpayer identification number of the purchaser;
(14) Denomination of certificates to be delivered at
settlement; and
(15) Global Certificate or Definitive Certificate.
B. Upon receiving the Book-Entry Sale Information from the Selling
Agent or the Purchasing Agent, as the case may be, the Company will assign a
CUSIP number to the Global Certificate representing such Book-Entry Security and
then as soon as practicable advise the Trustee by telephone (confirmed by
facsimile transmission) of the Book-Entry Sale Information received from the
Selling Agent or the Purchasing Agent, as the case may be, such CUSIP number and
the name of such Agent.
C. The Trustee will communicate to the Depositary, such Agent and
Standard & Poor's Corporation, through the Depositary'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 Depositary on behalf of the Trustee
and such Agent.
(3) Identification as a Fixed Rate Note, Floating Rate
Note or Zero Coupon Note.
(4) Initial Interest Payment Date for such Security,
number of days by which such date succeeds the
related record date for Depositary purposes (or, in
the case of Floating Rate Notes which reset daily or
weekly, the date five calendar days preceding the
Interest Payment Date) and, if then calculable, the
amount of interest payable on such Interest Payment
Date (which amount shall have been confirmed by the
Trustee).
(5) CUSIP number of the 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 complete and 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
authenticate such Global
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Certificate, to register such Global Certificate in the name of Cede & Co., as
nominee of the Depositary, and to effect delivery thereof to the Depositary by
the Trustee's possession of such authenticated Global Certificate as agent for
the Depositary.
E. The Trustee will authenticate the Global Certificate representing
such Book-Entry Security, register such Global Certificate in the name of Cede &
Co., as nominee of the Depositary, and take delivery thereof as agent for the
Depositary.
F. The Depositary will credit such Book-Entry Security to the
participant account of the Trustee maintained by the Depositary.
G. The Trustee will enter an SDFS deliver order through the
Depositary's Participant Terminal System instructing the Depositary (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 Depositary 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 Depositary, 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 representation and warranty by the
Trustee to the Depositary that (i) the Global Certificate representing such
Book-Entry Note has been issued, authenticated and delivered and (ii) the
Trustee is holding such Global Certificate pursuant to the Medium-Term Note
Certificate Agreement between the Trustee and the Depositary.
H. The Selling Agent or the Purchasing Agent, as the case may be, will
enter an SDFS deliver order through the Depositary's Participant Terminal System
instructing the Depositary (i) to debit such Book-Entry Security to the
participant account of such Agent and credit such Book-Entry Security to the
participant accounts of the Participants with respect to such Book-Entry
Security maintained by the Depositary and (ii) to debit the settlement accounts
of such Participants and credit the settlement account of such Agent maintained
by the Depositary 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
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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 Depositary'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:
Settlement
PROCEDURE TIME
A 11:00 a.m. on the trade date
B 12:00 Noon on the trade date
C 2:00 p.m. on the trade date
D 3:00 p.m. on the Business Day before
Settlement Date
E 9:00 a.m. on Settlement Date
F 10:00 a.m. on Settlement Date
G-H 2:00 p.m. on Settlement Date
I 4:45 p.m. on Settlement Date
J-K 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 such sale
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 no later than 11:00 a.m. 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 in accordance with any extension of Fedwire
closing deadlines and in the other events specified in the SDFS operating
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procedures in effect on the settlement date. If settlement of a Book-Entry
Security is rescheduled or canceled, the Company will, as soon as practicable,
give the Trustee notice to such effect. The Trustee will deliver to the
Depositary, through the Depositary's Participant Terminal System, a cancellation
message to such effect by no later than 2:00 p.m., New York City time, on the
Business Day immediately preceding the scheduled Settlement Date (provided the
Trustee received such notice from the Company by noon on the Business Day
immediately preceding the Settlement Date) and in any case as soon as
practicable. A copy of such message will be routed through the facilities of the
Depositary 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 may deliver to the Depositary, through the Depositary's Participant
Terminal System, as soon as practicable, a withdrawal message instructing the
Depositary to debit such Book-Entry Security to the participant account of the
Trustee maintained at the Depositary. A copy of such message will be routed
through the facilities of the Depositary to such Agent. The Depositary 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 the Book-Entry Securities represented by a
particular Global Certificate, the Trustee will immediately cancel 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 canceled and not immediately 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, one of which shall
represent the Book-Entry Securities for which withdrawal messages are processed
and shall be canceled 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 Depositary,
acting on behalf of such purchaser (other than the 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 Depositary's
Participant Terminal System reversing the orders
II-17
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 Depositary 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.
II-18
ANNEX III
ACCOUNTANTS' LETTER
Pursuant to Section 4(j) and Section 6(d), as the case may be, of the
Distribution Agreement, the Company's independent certified public accountants
shall furnish letters 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 rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules (and, if applicable, financial forecasts
and/or pro forma financial information) 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 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, copies
of which have been furnished to the Agents;
(iii) In their opinion, the unaudited selected financial information
with respect to the consolidated results of operations and financial position of
the Company for the five most recent fiscal years included in the Prospectus and
included or incorporated by reference in Item 6 of the Company's Annual Report
on Form 10-K for the most recent fiscal year agrees with the corresponding
amounts (after restatement where applicable) in the audited consolidated
financial statements for the five such fiscal years which were included or
incorporated by reference in the Company's Annual Reports on Form 10-K for such
fiscal years;
(iv) They have made a review in accordance with standards established
by the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets and
consolidated statements of cash flows included in the Prospectus and/or included
in the Company's quarterly reports on Form 10-Q incorporated by reference into
the Prospectus [as indicated in their reports thereon copies of which have been
separately furnished to the Agents]; and on the basis of specified procedures
including inquiries of officials of the Company who have responsibility for
financial and accounting matters regarding whether the unaudited condensed
consolidated financial statements referred to in paragraph (v)(A) below comply
as to form in all material respects with the applicable accounting requirements
of the Act and the Exchange Act and the related published
III-1
rules and regulations, nothing came to their attention that caused them to
believe that the unaudited condensed consolidated financial statements do not
comply as to form in all material respects with the applicable accounting
requirements of the Act and the Exchange Act and the related published rules and
regulations;
(v) On the basis of limited procedures, not constituting an examination
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 financial statements of the
Company and its subsidiaries, inspection of the minute books of the Company and
its subsidiaries since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, inquiries of officials
of the Company and its subsidiaries 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,
consolidated balance sheets and consolidated statements of changes in
financial position 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, consolidated balance
sheets and consolidated statements of changes in financial position
included or incorporated by reference in the Company's Annual Report on
Form 10-K for the most recent fiscal year, as applicable;
(B) Any other unaudited income statement data and balance
sheet 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, or 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,
as applicable;
(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 balance sheet 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, as applicable;
III-2
(D) Any unaudited pro forma consolidated condensed 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 days prior to
the date of such letter, there have been any changes in the
consolidated 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 balance
sheet included or incorporated by reference in the Prospectus) or any
increase in the consolidated long-term debt of the Company and its
subsidiaries, or as of the latest period for which financial statements
are available, any decreases in consolidated net current assets or net
assets or other items specified by the Agents, or any increases in any
items specified by the Agents, in each case as compared with amounts
shown in the latest balance sheet 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
which are described in such letter; and
(F) For the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in Clause (E) there were any decreases
in consolidated net revenues or operating profit or the total or per
share amounts of consolidated net income or other items specified by
the Agents, or any increases in any items specified by the Agents, in
each case as compared with the comparable period of the preceding year
and with any other period of corresponding length specified by the
Agents, except in each case for increases or decreases which the
Prospectus discloses have occurred or may occur or which are described
in such letter; and
III-3
(v) In addition to the examination referred to in their
report(s) included or incorporated by reference in the Prospectus and
the limited procedures, inspection of minute books, inquiries and other
procedures referred to in paragraphs (iii) and (iv) above, they have
carried out certain specified procedures, not constituting an
examination in accordance with generally accepted auditing standards,
with respect to certain amounts, percentages and financial information
specified by the Agents which 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
such amounts, percentages and financial information 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 as of
the Commencement Date referred to in Section 6(d) thereof and to the
Prospectus as amended or supplemented (including the documents
incorporated by reference therein) as of the date of the amendment,
supplement, incorporation or the Time of Delivery relating to the Terms
Agreement requiring the delivery of such letter under Section 4(j)
thereof.
III-4