▇▇▇ ▇▇▇▇▇ AND COMPANY
$500,000,000
Medium-Term Notes
Due More Than Nine Months from Date of Issue
U.S. DISTRIBUTION AGREEMENT
November 9, 1995
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
▇▇▇ ▇▇▇▇▇ and Company, an Indiana corporation (the 'Company'), confirms its
agreement with each of you with respect to the issue and sale from time to time
by the Company of up to $500,000,000 (or the equivalent thereof in one or more
foreign currencies or composite currencies) aggregate initial public offering
price of its medium-term notes due more than nine months from date of issue (the
'Notes'). The Notes will be issued under an Indenture dated as of February 1,
1991 (the 'Indenture') between the Company and Citibank, N.A., as Trustee (the
'Trustee'), and will have the maturities, interest rates, redemption provisions,
if any, and other terms as set forth in supplements to the Basic Prospectus
referred to below.
Subject to the reservation by the Company of the right to solicit offers to
purchase and to sell Notes directly on its own behalf, through any subsidiary or
through an electronic auction system at any time, upon any terms and to any
person, the Company hereby appoints ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated and
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. as its agents (each an 'Agent') for the purpose of
soliciting and receiving offers to purchase Notes from the Company by others
and, on the basis of the representations and warranties herein contained, but
subject to terms and conditions herein set forth, each Agent agrees, severally
but not jointly, to use reasonable best efforts to solicit and receive offers to
purchase Notes upon terms acceptable to the Company at such times and in such
amounts as the Company shall from time to time specify. In addition, any Agent
may also purchase Notes as principal and, if agreed to by the Company and the
Agent, the Company will enter into a Terms Agreement relating to such sale (a
'Terms Agreement') in accordance with the provisions of Section 2(b) hereof. The
Company may appoint additional agents to solicit sales of the Notes; provided
that any such solicitation and sale of Notes shall be on the same terms and
conditions as provided for in this Agreement. This Agreement shall only apply to
sales of the Notes and not to sales of any other securities or evidences of
indebtedness and only on the specific terms set forth herein or in a Terms
Agreement.
The Company has filed with the Securities and Exchange Commission (the
'Commission') a registration statement (Registration No. 33-58977), including a
prospectus, relating to debt securities, including the Notes. Such registration
statement, including the exhibits thereto, as amended at the Commencement Date
(as hereinafter defined), is hereinafter referred to as the 'Registration
Statement.' The Company proposes to file with the Commission from time to time,
pursuant to Rule 424 under the Securities Act of 1933, as amended (the
'Securities Act'), supplements to the prospectus included in the Registration
Statement that will describe certain terms of the Notes. The prospectus in the
form in which it appears in the Registration Statement is hereinafter referred
to as the 'Basic Prospectus.' The term 'Prospectus' means the Basic Prospectus
together with the prospectus supplement or supplements (each a 'Prospectus
Supplement') specifically relating to the Notes, as filed with, or transmitted
for filing to, the Commission pursuant to Rule 424. As used herein, the terms
'Basic Prospectus' and 'Prospectus' shall include in each case the documents, if
any, incorporated by reference therein. The terms 'supplement' and 'amendment'
2
or 'amend' as used herein shall include all documents that are deemed to be
incorporated by reference in the Prospectus that are filed subsequent to the
date of the Basic Prospectus by the Company with the Commission pursuant to the
Securities Exchange Act of 1934, as amended (the 'Exchange Act').
1. Representations and Warranties. The Company represents and warrants to
and agrees with each Agent as of the Commencement Date, as of each date on which
the Company accepts an offer to purchase Notes (including any purchase by an
Agent pursuant to a Terms Agreement), as of each date the Company issues and
sells Notes and as of each date the Registration Statement or the Basic
Prospectus is amended or supplemented, as follows (it being understood that such
representations, warranties and agreements shall be deemed to relate to the
Registration Statement, the Basic Prospectus and the Prospectus, each as amended
or supplemented to each such date):
(a) The Registration Statement has become effective; no stop order
suspending the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or threatened by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant to the
Exchange Act and incorporated by reference in the Prospectus complied, at the
time it was filed, or will comply when so filed in all material respects with
the Exchange Act and the applicable rules and regulations of the Commission
thereunder, (ii) each part of the Registration Statement, when such part became
effective, did not contain, and each such part, as amended or supplemented, if
applicable, will not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading, (iii) the Registration Statement and the
Prospectus comply, and, as amended or supplemented, if applicable, will comply
in all material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder and (iv) the Prospectus does not
contain and, as amended or supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, except that (1) the representations and
warranties set forth in this Section 1(b) do not apply (A) to statements or
omissions in the Registration Statement or the Prospectus based upon information
relating to any Agent furnished to
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the Company in writing by such Agent expressly for use therein or (B) to that
part of the Registration Statement that constitutes the Statement of Eligibility
and Qualification (Form T-1) under the Trust Indenture Act of 1939, as amended
(the 'Trust Indenture Act'), of the Trustee and (2) the representations and
warranties set forth in clauses (iii) and (iv) above, when made as of the
Commencement Date or as of any date on which the Company accepts an offer to
purchase Notes, shall be deemed not to cover information concerning an offering
of particular Notes to the extent such information will be set forth in a
supplement to the Basic Prospectus.
(c) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property and to
conduct its business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(d) Each significant subsidiary (as defined in Regulation S-X of the
Commission) of the Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its property and to
conduct its business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in which the
conduct of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on the Company and its
subsidiaries, taken as a whole.
(e) Each of this Agreement and any applicable Written Terms Agreement (as
hereinafter defined) has been duly authorized, executed and delivered by the
Company.
(f) The Indenture has been duly qualified under the Trust Indenture Act and
has been duly authorized, executed and delivered by the Company and is a valid
and binding agreement of the Company, enforceable in accordance with its terms
except as (i) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and (ii) rights
of
4
acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability.
(g) The Notes have been duly authorized and, when executed and
authenticated in accordance with the Indenture and delivered to and duly paid
for by the purchasers thereof, will be entitled to the benefits of the Indenture
and will be valid and binding obligations of the Company, enforceable in
accordance with their respective terms except as (i) the enforceability thereof
may be limited by bankruptcy, insolvency or similar laws affecting creditors'
rights generally and (ii) rights of acceleration and the availability of
equitable remedies may be limited by equitable principles of general
applicability.
(h) The execution and delivery by the Company of, and the performance by
the Company of its obligations under, this Agreement, the Notes, the Indenture
and any applicable Written Terms Agreement will not contravene any provision of
applicable law or the certificate of incorporation or by-laws of the Company or
any agreement or other instrument binding upon the Company or any of its
significant subsidiaries that is material to the Company and its subsidiaries,
taken as a whole, or any judgment, order or decree of any governmental body,
agency or court having jurisdiction over the Company or any significant
subsidiary, and no consent, approval, authorization or order of or qualification
with any governmental body or agency is required for the performance by the
Company of its obligations under this Agreement, the Notes, the Indenture and
any applicable Terms Agreement, except such as may be required by the securities
or Blue Sky laws of the various states in connection with the offer and sale of
the Notes.
(i) There has not been any material adverse change in the condition,
financial or otherwise, or in the earnings, business or operations of the
Company and its subsidiaries, taken as a whole, from that set forth in the
Prospectus.
(j) There are no legal or governmental proceedings pending or threatened to
which the Company or any of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is subject that are
required to be described in the Registration Statement or the Prospectus and are
not so described or any statutes, regulations, contracts or other documents that
are required to be described in the Registration Statement or the Prospectus or
to be filed as exhibits to the Registration Statement that are not described or
filed as required.
5
(k) Each of the Company and its significant subsidiaries has all necessary
consents, authorizations, approvals, orders, certificates and permits of and
from, and has made all declarations and filings with, all federal, state, local
and other governmental authorities, all self-regulatory organizations and all
courts and other tribunals, to own, lease, license and use its properties and
assets and to conduct its business in the manner described in the Prospectus,
except to the extent that the failure to obtain or file would not have a
material adverse effect on the Company and its subsidiaries, taken as a whole.
Notwithstanding the foregoing, the representations and warranties set forth
in Section 1(b)(iii) and (iv), (g) (except as to the authorization of the Notes)
and (h), when made as of the Commencement Date with respect to any Notes the
payments of principal or interest on which will be determined by reference to
one or more currency exchange rates, commodity prices, equity indices or other
factors, shall be deemed not to address the application of the Commodity
Exchange Act, as amended, or the rules, regulations or interpretations of the
Commodity Futures Trading Commission.
2. Solicitations as Agent; Purchases as Principal.
(a) Solicitations as Agent. In connection with each Agent's actions as
agent hereunder, each Agent agrees to use reasonable best efforts to solicit
offers to purchase Notes upon the terms and conditions set forth in the
Prospectus as then amended or supplemented. The Company may also solicit offers
to purchase, and sell Notes directly on its own behalf, through any subsidiary,
through an electronic auction system or through any other agent; provided that
any solicitation and sales by such other agent shall be on the same terms and
conditions as provided for in this Agreement.
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 Notes. Upon receipt of notice from the
Company, which may be communicated in writing or orally if promptly confirmed in
writing, each Agent will forthwith suspend solicitations of offers to purchase
Notes from the Company until such time as the Company has advised such Agent
that such solicitation may be resumed. While such solicitation is suspended, the
Company shall not be required to deliver any certificates, opinions or letters
in accordance with Sections 5(a), 5(b) and 5(c); provided,
6
however, that if the Registration Statement or Prospectus is amended or
supplemented during the period of suspension (other than by an amendment or
supplement providing solely for a change in the interest rates, redemption
provisions, amortization schedules or maturities offered on the Notes or for a
change the Agents deem to be immaterial), no Agent shall be required to resume
soliciting offers to purchase Notes until the Company has delivered such
certificates, opinions and letters of the type described in Section 5 as such
Agent may request.
The Company agrees to pay to each Agent, as consideration for the sale of
each Note resulting from a solicitation made or an offer to purchase received by
such Agent, a commission in the form of a discount from the purchase price of
such Note equal to the percentage set forth below of the purchase price of such
Note:
Term Commission Rate
---- ---------------
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%
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 less than 30 years .750%
30 years or more to be negotiated
Each Agent shall communicate to the Company, orally or in writing, each
offer to purchase Notes received by it as agent that in its reasonable judgment
should be considered by the Company. The Company shall have the sole right to
accept offers to purchase Notes and may reject any offer in whole or in part.
Each Agent shall have the right in its reasonable discretion to reject any offer
to purchase Notes that it considers to be unacceptable, and any such rejection
shall not be deemed a breach of its agreements contained herein. The procedural
details relating to the issue and delivery of Notes sold by any Agent as agent
and the payment therefor shall be as set forth in the Administrative Procedures
(as hereinafter defined).
(b) Purchases as Principal. Each sale of Notes to an Agent as principal
shall be made in accordance with the terms of this Agreement. In connection with
each such
7
sale, the Company will enter into a Terms Agreement that will provide for the
sale of such Notes to and the purchase thereof by such Agent. Each Terms
Agreement will take the form of either (i) a written agreement between such
Agent and the Company, which may be substantially in the form of Exhibit A
hereto (a 'Written Terms Agreement'), or (ii) an oral agreement between such
Agent and the Company confirmed in writing by such Agent to the Company.
An Agent's commitment to purchase Notes 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 Notes to be purchased by such Agent pursuant
thereto, the maturity date of such Notes, the price to be paid to the Company
for such Notes, the interest rate and interest rate formula, if any, applicable
to such Notes and any other terms of such Notes. Each such Terms Agreement shall
also specify any requirements for officers' certificates, opinions of counsel
and letters from the independent public accountants of the Company pursuant to
Section 4 hereof. A Terms Agreement may also specify certain provisions relating
to the reoffering of such Notes by such Agent.
Each Terms Agreement shall specify the time and place of delivery of and
payment for such Notes. Unless otherwise specified in a Terms Agreement, the
procedural details relating to the issue and delivery of Notes purchased by an
Agent as principal and the payment therefor shall be as set forth in the
Administrative Procedures. Each date of delivery of and payment for Notes to be
purchased by an Agent as principal, whether pursuant to a Terms Agreement or
otherwise, is referred to herein as a 'Settlement Date.'
(c) Administrative Procedures. Each Agent and the Company agree to perform
the respective duties and obligations specifically provided to be performed in
the Medium-Term Notes Administrative Procedures (attached hereto as Exhibit B)
(the 'Administrative Procedures'), as amended from time to time. The
Administrative Procedures may be amended only by written agreement of the
Company and each Agent.
(d) Delivery. The documents required to be delivered by Section 4 of this
Agreement as a condition precedent to each Agent's obligation to begin
soliciting offers to purchase Notes as agent of the Company shall be
8
delivered at the office of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, counsel for the Agents, not
later than 3:00 p.m., New York time, on the date hereof, or at such other time
and/or place as the Agents and the Company may agree upon in writing, but in no
event later than the day prior to the date on which the Agents begin soliciting
offers to purchase Notes or the first date on which the Company accepts any
offer by an Agent to purchase Notes pursuant to a Terms Agreement. The date of
delivery of such documents if referred to herein as the 'Commencement Date'.
(e) Obligations Several. The Company acknowledges that the obligations of
the Agents under this Agreement are several and not joint.
3. Agreements. The Company agrees with each Agent that:
(a) Prior to the termination of the offering of the Notes pursuant to this
Agreement or any Terms Agreement, the Company will not file any Prospectus
Supplement relating to the Notes or any amendment to the Registration Statement
(other than an amendment relating exclusively to securities other than Notes)
unless the Company has previously furnished to each Agent a copy thereof for its
review; provided, however, that the foregoing requirement shall not apply to any
of the Company's periodic filings with the Commission required to be filed
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, copies of
which filings the Company will cause to be delivered to each Agent promptly
after being filed with the Commission. Subject to the foregoing sentence, the
Company will promptly cause each Prospectus Supplement to be filed with or
transmitted for filing to the Commission in accordance with Rule 424(b) under
the Securities Act. The Company will promptly advise each Agent (i) of the
filing of any amendment or supplement to a Basic Prospectus, (ii) of the filing
and effectiveness of any amendment to the Registration Statement, (iii) of any
request by the Commission for any amendment to the Registration Statement or any
amendment or supplement to a Basic Prospectus or for any additional information,
(iv) of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution or threatening of
any proceeding for that purpose and (v) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the Notes
for sale in any jurisdiction or the initiation or threatening of any proceeding
for such purpose. The Company will use its best efforts to prevent the issuance
and, if issued, to obtain as soon as possible the withdrawal, of (i) any such
stop order issued by the
9
Commission in any event and (ii) any such stop order or notice of suspension of
qualification issued by any other authority at any time (a) when an Agent holds
any Notes as principal or (b) between the time of acceptance by the Company of
an offer to purchase Notes and the delivery of such Notes. If a Basic Prospectus
is amended or supplemented as a result of the filing under the Exchange Act of
any document incorporated by reference in the Prospectus, no Agent shall be
obligated to solicit offers to purchase Notes so long as it is not reasonably
satisfied with such document.
(b) If, at any time when a prospectus relating to the Notes is required to
be delivered under the Securities Act, any event occurs or condition exists as a
result of which the Prospectus, as then amended or supplemented, would include
an untrue statement of a material fact, or omit to state any material fact
necessary to make the statements therein, in the light of the circumstances when
the Prospectus, as then amended or supplemented, is delivered to a purchaser,
not misleading, or if, in the opinion of the Company, it is necessary at any
time to amend or supplement the Prospectus, as then amended or supplemented, to
comply with applicable law, the Company will immediately notify each Agent by
telephone (with confirmation in writing) to suspend solicitation of offers to
purchase Notes and, if so notified by the Company, each Agent shall forthwith
suspend such solicitation and cease using the Prospectus, as then amended or
supplemented. If the Company shall decide to amend or supplement the
Registration Statement or Prospectus, as then amended or supplemented, it shall
so advise each Agent promptly by telephone (with confirmation in writing) and,
at its expense, shall prepare and cause to be filed promptly with the Commission
an amendment or supplement to such Registration Statement or Prospectus, as then
amended or supplemented, that will correct such statement or omission or effect
such compliance and will supply such amended or supplemented Prospectus to each
Agent in such quantities as it may reasonably request. Notwithstanding the
foregoing, if at any such time the Company shall have instructed each Agent to
suspend solicitation of offers to purchase the Notes, the Company shall not be
obligated to so amend or supplement such Registration Statement or Prospectus
until such time as the Company shall determine that solicitations of purchases
of the Notes should be resumed unless (i) any Agent then holds any Notes it has
acquired as principal or (ii) any Agent is then required to deliver a prospectus
in connection with sales of the Notes. If such amendment or supplement and any
documents, certificates, opinions and letters furnished to the Agents pursuant
to paragraph (f)
10
below and Sections 5(a), 5(b) and 5(c) in connection with the preparation and
filing of such amendment or supplement are satisfactory in all reasonable
respects to the Agents, upon the filing with the Commission of such amendment or
supplement to the Prospectus or upon the effectiveness of an amendment to the
Registration Statement, the Agents will resume the solicitation of offers to
purchase Notes hereunder. Notwithstanding any other provision of this Section
3(b), until the distribution of any Notes any Agent may own as principal has
been completed, if any event described above in this paragraph (b) occurs, the
Company will, at its own expense, forthwith prepare and cause to be filed
promptly with the Commission an amendment or supplement to the Registration
Statement or Prospectus, as then amended or supplemented, reasonably
satisfactory in all respects to such Agent, will supply such amended or
supplemented Prospectus to it in such quantities as it may reasonably request
and shall furnish to it pursuant to paragraph (f) below and Sections 5(a), 5(b)
and 5(c) such documents, certificates, opinions and letters as it may request
covering matters limited to the preparation and filing of such amendment or
supplement.
(c) The Company will make generally available to its security holders and
to each Agent as soon as practicable earning statements that satisfy the
provisions of Section 11(a) of the Securities Act and the rules and regulations
of the Commission thereunder covering twelve month periods beginning, in each
case, not later than the first day of the Company's fiscal quarter next
following the 'effective date' (as defined in Rule 158 under the Securities Act)
of the Registration Statement with respect to each sale of Notes. If such fiscal
quarter is the last fiscal quarter of the Company's fiscal year, such earning
statement shall be made available not later than 90 days after the close of the
period covered thereby and in all other cases shall be made available not later
than 45 days after the close of the period covered thereby.
(d) The Company will furnish to each Agent, without charge, two signed
copies of the Registration Statement, including exhibits and all amendments
thereto, and during the period mentioned in Section 3(b) above, as many copies
of the Prospectus, any documents incorporated by reference therein (excluding
exhibits thereto) and any supplements and amendments thereto as any Agent may
reasonably request.
(e) The Company will endeavor to qualify, and to cooperate with you in an
endeavor to qualify, the Notes for offer and sale under the securities or Blue
Sky laws of such
11
jurisdictions as the Agents shall reasonably request and to maintain such
qualifications for as long as the Agents shall reasonably request except that
the Company need not qualify the Notes or maintain the qualification of the
Notes for offer and sale in any jurisdiction where such qualification or
continued qualification would, in the reasonable opinion of the Company, be
unduly burdensome to the Company.
(f) During the term of this Agreement, the Company shall furnish to each
Agent such relevant documents and certificates of officers of the Company
relating to the business, operations and affairs of the Company, the
Registration Statement, the Basic Prospectus, any amendments or supplements
thereto, the Indenture, the Notes, this Agreement, the Administrative
Procedures, any Terms Agreement and the performance by the Company of its
obligations hereunder or thereunder as such Agent may from time to time
reasonably request and shall notify each Agent promptly in writing of any
downgrading, or of its receipt of any notice of any intended or potential
downgrading, in the rating accorded any of the Company's securities by any
'nationally recognized statistical rating organization,' as such term is defined
for purposes of Rule 436(g)(2) under the Securities Act.
(g) The Company will, whether or not any sale of Notes is consummated, pay
all expenses incident to the performance of its obligations under this Agreement
and any Terms Agreement, including: (i) the preparation and filing of the
Registration Statement and the Prospectus and all amendments and supplements
thereto, (ii) the preparation, issuance and delivery of the Notes, (iii) the
fees and disbursements of the Company's counsel and accountants and of the
Trustee and its counsel, (iv) the qualification of the Notes under securities or
Blue Sky laws in accordance with the provisions of Section 3(e), including
filing fees and the reasonable fees and disbursements of one counsel for the
Agents in connection therewith and in connection with the preparation of any
Blue Sky or Legal Investment Memoranda, (v) the printing and delivery to each
Agent in quantities as hereinabove stated of copies of the Registration
Statement and all amendments thereto and of the Basic Prospectus and any
amendments or supplements thereto, (vi) any fees charged by rating agencies for
the rating of the Notes, (vii) the fees and expenses, if any, incurred with
respect to any filing with the National Association of Securities Dealers, Inc.,
(viii) the reasonable fees and disbursements of one counsel for both the Agents
incurred through the Commencement Date in connection with the offering and sale
of the Notes, including any opinions to be rendered by such counsel hereunder on
the Commencement Date,
12
and the reasonable fees and disbursements of one counsel for both the Agents
incurred in connection with the filing or proposed filing of any document
incorporated by reference in the Prospectus and the release of financial
information by the Company after the Commencement Date and (ix) any incidental
expenses as may be agreed upon by the Agents and the Company.
(h) From the date of any Terms Agreement to and including the Settlement
Date with respect to such Terms Agreement, the Company will not, without such
Agent's prior consent, offer, sell, contract to sell or otherwise dispose of any
debt securities of the Company substantially similar to such Notes (other than
(i) the Notes that are to be sold pursuant to such Terms Agreement and (ii)
commercial paper issued in the ordinary course of business), except as may
otherwise be provided in such Terms Agreement.
4. Conditions of the Obligations of the Agents. The obligation of each
Agent to solicit offers to purchase Notes as agent of the Company and the
obligation of each Agent to purchase Notes as principal pursuant to any Terms
Agreement or otherwise will be subject to the accuracy of the representations
and warranties on the part of the Company herein, to the accuracy of the
statements of the Company's officers made in each certificate furnished pursuant
to the provisions hereof and to the performance and observance by the Company of
all covenants and agreements herein contained on its part to be performed and
observed (in the case of an Agent's obligation to solicit offers to purchase
Notes, at the time of such solicitation, and, in the case of an Agent's
obligation to purchase Notes, at the time the Company accepts the offer to
purchase such Notes and at the time of purchase) and (in each such case) to the
following additional conditions precedent when and as specified:
(a) Prior to such solicitation or purchase, as the case may be:
(i) there shall not have occurred any change in the condition, financial or
otherwise, or in the earnings, business or operations, of the Company and its
subsidiaries, taken as a whole, from that set forth in the Prospectus, as
amended or supplemented at the time of such solicitation or at the time such
offer to purchase was made, that is material and adverse and that makes it
impracticable to market the Notes on the terms and in the manner contemplated
in the Prospectus, as so amended or supplemented;
13
(ii) there shall not have occurred any (A) suspension of trading generally
on either the New York Stock Exchange or the American Stock Exchange, or
fixing of minimum or maximum prices for trading, or requiring of maximum
ranges for prices of securities, by either of said exchanges or by order of
the Commission or by any other governmental authority, (B) suspension of
trading of any securities of the Company on any exchange or in any
over-the-counter market, (C) declaration of a general moratorium on
commercial banking activities in New York by either Federal or New York State
authorities or (D) any outbreak or escalation of hostilities or any other
calamity or crisis the effect of which on the financial markets of the United
States is such as to make it, in the reasonable judgment of the relevant
Agent, impracticable to market the Notes on the terms and in the manner
contemplated by the Prospectus, as amended or supplemented; and
(iii) there shall not have been any downgrading, nor any notice given of
any intended or potential downgrading in the rating accorded any of the
Company's securities by either ▇▇▇▇▇'▇ Investors Service, Inc. or Standard &
Poor's Corporation;
except, in each case described in paragraph (i), (ii) or (iii) above, as
disclosed to the Agents orally or in writing by the Company prior to such
solicitation or, in the case of a purchase of Notes, before the Company accepted
the offer to purchase such Notes. In addition, the satisfaction of the
conditions precedent set forth in this Section 4(a) shall be a condition to the
obligation of any purchaser (other than an Agent purchasing Notes as principal)
to purchase Notes.
(b) On the Commencement Date and, if called for by any Terms Agreement on
the corresponding Settlement Date, the relevant Agents shall have received:
(i) The opinion, dated as of such date, of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇, independent
counsel for the Company, substantially in the form of Exhibit C1 hereto;
(ii) The opinion, dated as of such date, of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Deputy
General Counsel and Secretary for the Company, substantially in the form of
Exhibit C2 hereto; and
14
(iii) The opinion, dated as of such date, of ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇, special
counsel for the Agents, substantially in the form of Exhibit C3 hereto.
If any of the foregoing opinions are delivered in connection with any Agreement
by an Agent to purchase Notes as principal, the forms of such opinions shall be
modified to relate to the issuance of such Notes and to the Registration
Statement and the Prospectus as amended and supplemented to the date of delivery
of such opinions.
(c) On the Commencement Date and, if called for by any Terms Agreement on
the corresponding Settlement Date, the relevant Agents shall have received a
certificate, dated the Commencement Date or such Settlement Date, as the case
may be, signed by an executive officer of the Company to the effect set forth in
subparagraph (a)(iii) above and to the effect that the representations and
warranties of the Company contained herein are true and correct as of such date
and that the Company has complied with all of the agreements and satisfied all
of the conditions on its part to be performed or satisfied on or before such
date.
The officer signing and delivering such certificate may rely upon the best
of his knowledge as to proceedings threatened.
(d) On the Commencement Date and, if called for by any Terms Agreement on
the corresponding Settlement Date, the Company's independent public accountants
shall have furnished to the relevant Agents a letter or letters, dated as of the
Commencement Date or such Settlement Date, as the case may be, in form and
substance reasonably satisfactory to such Agents containing statements and
information of the type ordinarily included in accountant's 'comfort letters' to
underwriters with respect to the financial statements and certain financial
information contained in or incorporated by reference into the Prospectus, as
then amended or supplemented.
(e) On the Commencement Date and on each Settlement Date, the Company shall
have furnished to each Agent such appropriate further information, certificates
and documents as such Agent may reasonably request.
5. Additional Agreements of the Company. (a) Each time the Registration
Statement or Prospectus is amended or supplemented (other than by an amendment
or supplement providing solely for a change in the interest rates, redemption
provisions, amortization schedules or maturities offered on the Notes or for a
change the Agents
15
deem to be immaterial), the Company will deliver or cause to be delivered
forthwith to each Agent a certificate signed by an executive officer of the
Company, dated the date of such amendment or supplement, as the case may be, in
form reasonably satisfactory to the Agents, of the same tenor as the certificate
referred to in Section 4(c) relating to the Registration Statement or the
Prospectus as amended or supplemented to the time of delivery of such
certificate; provided that unless the Agents so request, no such certificate
need be furnished in connection with the filing by the Company of a Current
Report on Form 8-K or a proxy statement.
(b) Each time the Company furnishes a certificate pursuant to Section 5(a)
(other than an amendment or supplement setting forth or incorporating by
reference financial statements or other financial information as of and for a
fiscal quarter unless the Agents request that such opinion of counsel be
furnished), the Company will furnish or cause to be furnished forthwith to the
Agents a written opinion of counsel for the Company (who may be an employee of
the Company). Any such opinion shall be dated the date of such amendment or
supplement, as the case may be, shall be in a form reasonably satisfactory to
the Agents and shall be of the same tenor as the opinion referred to in Sections
4(b)(i) and 4(b)(ii) but modified to relate to the Registration Statement and
the Prospectus as amended and supplemented to the time of delivery of such
opinion. In lieu of such opinion, counsel last furnishing such an opinion to the
Agents may furnish to the Agents a letter to the effect that the Agents may rely
on such last opinion to the same extent as though it were dated the date of such
letter (except that statements in such last opinion will be deemed to relate to
the Registration Statement and the Prospectus as amended or supplemented to the
time of delivery of such letter.)
(c) Each time the Registration Statement or the Prospectus is amended or
supplemented to set forth amended or supplemental financial information or such
amended or supplemental information is incorporated by reference in the
Registration Statement or the Prospectus, the Company shall cause its
independent public accountants forthwith to furnish the Agents with a letter,
dated the date of such amendment or supplement, as the case may be, in form
reasonably satisfactory to the Agents, of the same tenor as the letter referred
to in Section 4(d), with regard to the amended or supplemental financial
information included or incorporated by reference in the Registration Statement
or the Prospectus as amended or supplemented to the date of such letter;
provided that if the Registration Statement or
16
the Prospectus is amended or supplemented solely to include or incorporate by
reference unaudited financial information as of and for a fiscal quarter, such
independent public accountants may limit the scope of such letter to the
unaudited financial statements and other information included in such amendment
or supplement derived from the accounting records of the Company.
(d) Each time the Company intends to issue a Note, the payment of principal
or interest on which is to be determined by reference to one or more currency
exchange rates, commodity prices, equity indices or other factors, (i) the
Company shall furnish or cause to be furnished an opinion of ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ on
the corresponding Settlement Date to the effect set forth in Section 4(b)(i)
hereof (but deleting the second sentence of numbered paragraph 3 and the
penultimate paragraph), and ▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇ shall deliver an opinion on
the corresponding Settlement Date to the effect set forth in Section 4(b)(iii)
hereof (but deleting the first sentence of the seventh paragraph thereof), both
as modified to relate to the Registration Statement and the Prospectus as then
amended or supplemented. Such opinions shall be dated the corresponding
Settlement Date, shall be in a form reasonably satisfactory to the Agents and
delivery of such opinions shall be a condition of the purchasers' obligation to
purchase such Notes.
6. Indemnification and Contribution. (a) The Company agrees to indemnify
and hold harmless each Agent and each person, if any, who controls such Agent
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act from and against any and all losses, claims, damages and
liabilities caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or in any amendment
thereof or the Prospectus (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto), or caused by any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, except insofar as
such losses, claims, damages or liabilities are caused by any such untrue
statement or omission or alleged untrue statement or omission based upon
information relating to any Agent furnished to the Company in writing by such
Agent expressly for use therein.
(b) Each Agent agrees, severally and not jointly, to indemnify and hold
harmless the Company, its directors, its officers who sign the Registration
Statement and each person, if any, who controls the Company within the meaning
17
of either Section 15 of the Securities Act or Section 20 of the Exchange Act to
the same extent as the foregoing indemnity from the Company to each Agent, but
only with reference to information relating to such Agent furnished to the
Company in writing by such Agent expressly for use in the Registration Statement
or the Prospectus or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation) shall
be instituted involving any person in respect of which indemnity may be sought
pursuant to either paragraph (a) or (b) above, such person (the 'indemnified
party') shall promptly notify the person against whom such indemnity may be
sought (the 'indemnifying party') in writing and the indemnifying party, upon
request of the indemnified party, shall retain counsel reasonably satisfactory
to the indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and
disbursements of such counsel reasonably incurred related to such proceeding. In
any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all such indemnified parties and that all
such fees and expenses shall be reimbursed as they are incurred. Such firm shall
be designated in writing by the relevant Agent or Agents, in the case of parties
indemnified pursuant to paragraph (a) above, and by the Company, in the case of
parties indemnified pursuant to paragraph (b) above. The indemnifying party
shall not be liable for any settlement of any proceeding effected without its
written consent, but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have
been a party and
18
indemnity could have been sought hereunder by such indemnified party, unless
such settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such proceeding.
(d) If the indemnification provided for in paragraph (a) or (b) of this
Section 6 is unavailable to an indemnified party or insufficient in respect of
any losses, claims, damages or liabilities referred to therein in connection
with any offering of Notes, then each indemnifying party under such paragraph,
in lieu of indemnifying such indemnified party thereunder, shall contribute to
the amount paid or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand and each
Agent on the other from the offering of such Notes or (ii) if the allocation
provided by clause (i) is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in clause
(i) above but also the relative fault of the Company on the one hand and each
Agent on the other in connection with the statements or omissions that resulted
in such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and each Agent on the other in connection with the offering of such
Notes shall be deemed to be in the same respective proportions as the total net
proceeds from the offering of such Notes (before deducting expenses) received by
the Company bear to the total discounts and commissions received by such Agent
in respect thereof. The relative fault of the Company on the one hand and of
each Agent on the other shall be determined by reference to, among other things,
whether the untrue or allegedly untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or by such Agent and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. Each Agent's obligation to contribute pursuant to this
Section 6 shall be several (in the proportion of the principal amount of the
Notes the sale of which by or through any Agent gave rise to such losses,
claims, damages or liabilities) and not joint.
(e) The Company and the Agents agree that it would not be just or equitable
if contribution pursuant to this Section 6 were determined by pro rata
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in paragraph (d)
19
above. The amount paid or payable by an indemnified party as a result of the
losses, claims, damages and liabilities referred to in paragraph (d) above shall
be deemed to include, subject to the limitations set forth above, any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 6, no Agent shall be required to contribute any
amount in excess of the amount by which the total price at which the Notes
referred to in paragraph (d) above that were offered and sold to the public
through such Agent exceeds the amount of any damages that 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 Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The remedies provided for in this Section 6 are
not exclusive and shall not limit any rights or remedies which may otherwise be
available to any indemnified party at law or in equity.
7. Position of the Agents. In acting under this Agreement and in connection
with the sale of any Notes by the Company (other than Notes sold to an Agent
pursuant to a Terms Agreement), each Agent is acting solely as agent of the
Company and does not assume any obligation towards or relationship of agency or
trust with any purchaser of Notes. Each Agent shall make reasonable best efforts
to assist the Company in obtaining performance by each purchaser whose offer to
purchase Notes has been solicited by such Agent and accepted by the Company, but
such Agent shall not have any liability to the Company in the event any such
purchase is not consummated for any reason. If the Company shall default in its
obligations to deliver Notes to a purchaser whose offer it has accepted, the
Company shall hold the relevant Agent harmless against any loss, claim, damage
or liability arising from or as a result of such default and shall, in
particular, pay to such Agent the commission it would have received had such
sale been consummated.
8. Termination. This Agreement may be terminated at any time either by the
Company or, as to any Agent, by such Agent upon the giving of written notice of
such termination to each other party hereto. Any Terms Agreement shall be
subject to termination on the terms set forth or incorporated by reference
therein. The termination of this Agreement shall not require termination of any
Terms Agreement and the termination of any such Terms Agreement shall not
require termination of this Agreement. If this Agreement is terminated, the
provisions of the third
20
paragraph of Section 2(a), the last sentence of Section 3(b) and Sections 3(c),
3(g), 6, 7, 9 and 13 shall survive; provided that if at the time of termination
an offer to purchase Notes has been accepted by the Company but the time of
delivery to the purchaser or its agent of such Notes has not occurred, the
provisions of Sections 2(b), 2(c), 3(a), 3(b), 3(e), 3(f), 3(h)(if applicable),
4 and 5 shall also survive. If any Terms Agreement is terminated, the provisions
of Sections 2(b), 2(c), 3, 4, 5, 6, 9 and 13 (which shall have been incorporated
by reference in such Terms Agreement) shall survive.
9. Representations and Indemnities to Survive. The respective indemnity and
contribution agreements, representations, warranties and other statements of the
Company, its officers and the Agents set forth in or made pursuant to this
Agreement or any Terms Agreement will remain in full force and effect,
regardless of any termination of this Agreement or any such Terms Agreement, any
investigation made by or on behalf of an Agent or the Company or any of the
officers, directors or controlling persons referred to in Section 6 and delivery
of and payment for the Notes.
10. Notices. Unless otherwise noted, all communications hereunder will be
in writing and effective only on receipt, and, if sent to ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co.
Incorporated, will be mailed, delivered or telefaxed and confirmed to it at ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Manager-Continuously
Offered Products, with a copy to you at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ ▇▇▇▇▇▇, Investment Banking Information Center, if
sent to ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co., will be mailed, delivered or telefaxed and
confirmed to it at ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
Registration Department or, if sent to the Company, will be mailed, delivered or
telefaxed and confirmed to it at Lilly Corporate Center, Indianapolis, Indiana
46285, Attention: Vice President, Treasurer.
11. Successors. This Agreement and any Terms Agreement will inure to the
benefit of and be binding upon the parties hereto and their respective
successors and the officers, directors and controlling persons referred to in
Section 6 and the purchasers of Notes (to the extent expressly provided in
Section 4), and no other person will have any right or obligation hereunder. The
term 'successors' shall not include any purchaser of Notes merely because of
such purchase.
21
12. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
13. Applicable Law. This Agreement will be governed by and construed in
accordance with the internal laws of the State of New York.
14. Headings. The headings of the sections of this Agreement have been
inserted for convenience of reference only and shall not be deemed a part of
this Agreement.
If the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicate hereof, whereupon this
letter and your acceptance shall represent a binding agreement between the
Company and the Agents.
Very truly yours,
▇▇▇ ▇▇▇▇▇ AND COMPANY
By _______________________
Name:
Title:
The foregoing Agreement
is hereby confirmed
and accepted as of the
date first above written.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & CO. INCORPORATED
By ________________________
Name:
Title:
___________________________
▇▇▇▇▇▇▇, ▇▇▇▇▇ & CO.
22
Exhibit A
▇▇▇ ▇▇▇▇▇ AND COMPANY
MEDIUM-TERM NOTES
TERMS AGREEMENT
________________ , 19__
▇▇▇ ▇▇▇▇▇ and Company
Lilly Corporate Center
Indianapolis, Indiana 46285
Re: Distribution Agreement dated November 9, 1995
(the 'Distribution Agreement')
---------------------------------------------
The undersigned agrees to purchase your Medium-Term Notes having the
following terms:
Floating
Fixed Rate Rate
All Notes: Notes: Notes:
--------- ---------- --------
Principal Interest Base rate:
amount: Rate:
Index
Purchase Applicability maturity:
price: of modified
payment upon Spread:
Price to acceleration:
public: Spread
If yes, state multiplier:
Settlement issue prices:
date and time: Alternate rate
event spread:
A-1
Place of Amortization Initial interest
delivery: schedule: rate:
Specified Initial interest
currency: reset date:
Maturity Interest reset
date: dates:
Initial accrual Interest reset
period OID: period:
Original yield Maximum interest
to maturity: rate:
Optional redemption Minimum interest
date(s): rate:
Initial redemption Interest payment
date: period:
Initial redemption Interest payment
percentage: dates:
Annual redemption Calculation
agent:
percentage
decrease:
Other terms:
The provisions of Sections 1, 2(b) and 2(c) and 3 through 6 and 8
through 13 of the Distribution Agreement and the related definitions are
incorporated by reference herein and shall be deemed to have the same force and
effect as if set forth in full herein.
A-2
The following information, opinions, certificates, letters and
documents referred to in Section 4 of the Distribution Agreement will be
required: ________________
[NAME OF AGENT]
By __________________________
Title:
Accepted:
▇▇▇ ▇▇▇▇▇ AND COMPANY
By _________________________
Title:
A-3
EXHIBIT B
▇▇▇ ▇▇▇▇▇ AND COMPANY
MEDIUM-TERM NOTES
ADMINISTRATIVE PROCEDURES
------------------------
Explained below are the administrative procedures and specific terms
of the offering of Medium-Term Notes (the 'Notes'), on a continuous basis by ▇▇▇
▇▇▇▇▇ and Company (the 'Company') pursuant to the Distribution Agreement, dated
as of November 9, 1995 (the 'Distribution Agreement') between the Company and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated and ▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. (each an 'Agent'). In
the Distribution Agreement, each Agent has agreed to use its reasonable best
efforts to solicit purchases of the Notes. Each Agent, as principal, may
purchase Notes for its own account and if requested by such Agent, the Company
and such Agent will enter into a terms agreement, as contemplated by the
Distribution Agreement. The Company may also solicit offers to purchase and to
sell Notes directly on its own behalf, through any subsidiary or through an
electronic auction system at any time, upon any terms and to any person.
The Notes will be issued pursuant to the provisions of an indenture
dated as of February 1, 1991 (as it may be supplemented or amended from time to
time, the 'Indenture'), between the Company and Citibank, N.A. as trustee (the
'Trustee'). The Trustee will be the Registrar, Calculation Agent, Authenticating
Agent and Paying Agent for the Notes and will perform the duties specified
herein. Notes will bear interest at a fixed rate (the 'Fixed Rate Notes'), which
may be zero in the case of certain original issue discount notes (the 'OID
Notes'), or at floating rates (the 'Floating Rate Notes'). Fixed Rate Notes may
pay a level amount in respect of both interest and principal amortized over the
life of the Notes (the 'Amortizing Notes'). The Notes will be issued in U.S.
dollars or other currencies, including composite currencies such as the European
Currency Unit (the 'Specified Currency'). Each Note will be represented by
either a Global Security (as defined below) delivered to the Trustee, as agent
for The Depository Trust Company ('DTC'), and recorded in the book-entry system
maintained by DTC (a 'Book-Entry Note') or a certificate delivered to the holder
thereof or a person designated by such holder (a 'Certificated Note'). Except in
B-1
limited circumstances, an owner of a Book-Entry Note will not be entitled to
receive a Certificated Note.
Book-Entry Notes, which may be payable only in U.S. dollars, will be
issued in accordance with the administrative procedures set forth in Part I
hereof as they may subsequently be amended as the result of changes in DTC'S
operating procedures, and Certificated Notes will be issued in accordance with
the administrative procedures set forth in Part II hereof. Unless otherwise
defined herein, terms defined in the Indenture or the Notes shall be used herein
as therein defined.
PART I: ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY NOTES
In connection with the qualification of the Book-Entry Notes for
eligibility in the book-entry system maintained by DTC, 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 Trustee to DTC, dated as of November 9, 1995 (the
'Letter of Representations'), and a Medium-Term Note Certificate Agreement
between the Trustee and DTC, dated as of October 31, 1988, and its obligations
as a participant in DTC, including DTC's Same-Day Funds Settlement System
('SDFS').
Issuance: On any date of settlement (as defined
under 'Settlement' below) for one or more
Book-Entry Notes, the Company will issue a
single global security in fully registered
form without coupons (a 'Global Security')
representing up to U.S. $200,000,000
principal amount of all such Notes that
have the same Maturity Date, redemption or
repayment provisions, Interest Payment
Dates, Original Issue Date, original issue
discount provisions (if any) and, in the
case of Fixed Rate Notes, Interest Rate,
modified payment upon acceleration (if
any), amortization schedule (if any), or
in the case of Floating Rate Notes,
Initial Interest Rate, Interest Payment
Date(s), Interest Payment Period,
Calculation Agent, Base Rate, Index
Maturity, Interest Reset Period, Interest
Reset Dates, Spread or Spread Multiplier
(if any), Alternate Rate Event Spread (if
any), Minimum Interest Rate (if any) and
Maximum Interest Rate (if any) and, in
each case, any other relevant terms
B-2
(collectively 'Terms'). Each Global Security
will be dated and issued as of the date of
its authentication by the Trustee. Each
Global Security will bear an 'Interest
Accrual Date,' which will be (i) with
respect to an original Global Security (or
any portion thereof), its original issuance
date and (ii) with respect to any Global
Security (or any portion thereof) issued
subsequently upon exchange of a Global
Security, or in lieu of a destroyed, lost or
stolen Global Security, the most recent
Interest Payment Date to which interest has
been paid or duly provided for on the
predecessor Global Security or Securities
(or if no such payment or provision has been
made, the original issuance date of the
predecessor Global Security), regardless of
the date of authentication of such
subsequently issued Global Security.
Book-Entry Notes may be payable only in U.S.
dollars. No Global Security will represent
any Certificated Note.
Identification The Company has arranged with the CUSIP
Numbers: Service Bureau of Standard & Poor's
Corporation (the 'CUSIP Service Bureau')
for the reservation of a series of CUSIP
numbers (including tranche numbers) for
the Notes, each of which series consists
of approximately 900 CUSIP numbers and
relates to Global Securities representing
the Book-Entry Notes. The Company has
obtained from the CUSIP Service Bureau a
written list of each series of reserved
CUSIP numbers and has delivered to the
Trustee and DTC the written list of 900
CUSIP numbers of each such series. The
Trustee will assign CUSIP numbers to
Global Securities as described below under
Settlement Procedure 'B'. DTC will notify
the CUSIP Service Bureau periodically of
the CUSIP numbers that the Trustee has
assigned to Global Securities. At any
time when fewer than 100 of the reserved
CUSIP numbers of either series remain
unassigned to Global Securities, the
Trustee shall so advise the Company and,
if it deems necessary, the Company will
reserve additional CUSIP numbers for
B-3
assignment to Global Securities representing
Book-Entry Notes. Upon obtaining such
additional CUSIP numbers, the Company shall
deliver a list of such additional CUSIP
numbers to the Trustee and DTC.
Registration: Each Global Security will be registered in
the name of Cede & Co., as nominee for
DTC, on the security register maintained
under the Indenture. The beneficial owner
of a Book-Entry Note (or one or more
indirect participants in DTC designated by
such owner) will designate one or more
participants in DTC with respect to such
Note (the 'Participants') to act as agent
or agents for such owner in connection
with the book-entry system maintained by
DTC, and DTC will record in book-entry
form, in accordance with instructions
provided by such Participants, a credit
balance with respect to such beneficial
owner in such Note in the accounts of such
Participants. The ownership interest of
such beneficial owner in such Note will be
recorded through the records of such
Participants or through the separate
records of such Participants and one or
more indirect participants in DTC.
Transfers: Transfers of a Book-Entry Note will be
accomplished by book entries made by DTC
and, in turn, by Participants (and in
certain cases, one or more indirect
participants in DTC) acting on behalf of
beneficial transferors and transferees of
such Note.
Exchanges: The Trustee may deliver to DTC and the
CUSIP Service Bureau at any time a written
notice of consolidation specifying (i) the
CUSIP numbers of two or more outstanding
Global Securities that represent
Book-Entry Notes having the same Terms and
for which interest has been paid to the
same date, (ii) a date, occurring at least
thirty days after such written notice is
delivered and at least thirty days before
the next Interest Payment Date for such
Book-Entry Notes, on which such Global
Securities shall be exchanged for a single
B-4
replacement Global Security and (iii) a new
CUSIP number to be assigned to such
replacement Global Security. Upon receipt of
such a notice, DTC 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 a 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 Securities to be
exchanged will no longer be valid. On the
specified exchange date, the Trustee will
exchange such Global Securities for a single
Global Security bearing the new CUSIP number
and a new Interest Accrual Date, and the
CUSIP numbers of the exchanged Global
Securities will, in accordance with CUSIP
Service Bureau procedures, be canceled and
not immediately reassigned. Notwithstanding
the foregoing, if the Global Securities to
be exchanged exceed U.S. $200,000,000 in
aggregate principal amount, one Global
Security will be authenticated and issued to
represent each U.S. $200,000,000 principal
amount of the exchanged Global Security and
an additional Global Security will be
authenticated and issued to represent any
remaining principal amount of such Global
Securities (see 'Denominations' below).
Maturities: Each Book-Entry Note will mature on a date
selected by the Purchaser and agreed to by
the Company, such date being more than nine
months from date of issue.
Notice of The Trustee will give notice to DTC
Redemption Dates: prior to each redemption date or repayment
date (as specified in the Note), if any, at
the time and in the manner set forth in the
Letter of Representations.
Denominations: Book-Entry Notes will be issued in principal
amounts of U.S. $1,000 or any amount in
excess thereof that is an integral multiple
of U.S. $1,000. Global Securities will be
denominated in
B-5
principal amounts not in excess of U.S.
$100,000,000. If one or more Book-Entry
Notes having an aggregate principal amount
in excess of $100,000,000 would, but for the
preceding sentence, be represented by a
single Global Security, then one Global
Security will be issued to represent each
U.S. $100,000,000 principal amount of such
Book-Entry Note or Notes and an additional
Global Security will be issued to represent
any remaining principal amount of such
Book-Entry Note or Notes. In such a case,
each of the Global Securities representing
such Book-Entry Note or Notes shall be
assigned the same CUSIP number.
Interest: General. Interest on each Book-Entry Note
will accrue from the Interest Accrual Date
of the Global Security representing such
Note. Each payment of interest on a
Book-Entry Note will include interest
accrued to but excluding the Interest
Payment Date; provided that in the case of
Floating Rate Notes that reset daily or
weekly, interest payments will include
interest accrued to and including the
Record Date immediately preceding the
Interest Payment Date, except that at
maturity or earlier redemption or
repayment, the interest payable will
include interest accrued to, but
excluding, the maturity date or the date
of redemption or repayment, as the case
may be. Interest payable at the maturity
or upon redemption or repayment of a
Book-Entry Note will be payable to the
person to whom the principal of such Note
is payable. Standard & Poor's Corporation
will use the information received in the
pending deposit message described under
Settlement Procedure 'C' below in order to
include the amount of any interest payable
and certain other information regarding
the related Global Security in the
appropriate weekly bond report published
by Standard & Poor's Corporation.
Record Dates. The Record Date with respect
to any Interest Payment Date shall be the
date fifteen calendar days
B-6
immediately preceding such Interest Payment
Date.
Fixed Rate Book-Entry Notes. Unless
otherwise specified in the applicable
Pricing Supplement (as defined below),
interest payments on Fixed Rate Book-Entry
Notes, other than Amortizing Notes, will be
made annually on March 1 or semiannually on
March 1 and September 1 of each year and at
maturity or upon any earlier redemption or
repayment, and Book-Entry Amortizing Notes
will pay principal and interest semiannually
each March 1 and September 1, or quarterly
each March 1, June 1, September 1 and
December 1, as set forth in the applicable
Pricing Supplement, and at maturity or upon
any earlier redemption or repayment;
provided, however, that in the case of a
Fixed Rate Book-Entry Note issued between a
Record Date and an Interest Payment Date,
the first interest payment will be made on
the Interest Payment Date following the next
succeeding Record Date.
Floating Rate Book-Entry Notes. Unless
otherwise specified in the applicable
Pricing Supplement, interest payments will
be made on Floating Rate Book-Entry Notes
monthly, quarterly, semi-annually or
annually. Unless otherwise specified in the
applicable Pricing Supplement, interest will
be payable, in the case of Floating Rate
Book-Entry Notes with a daily, weekly or
monthly Interest Reset Date, on the third
Wednesday of each month or on the third
Wednesday of March, June, September and
December, as specified pursuant to
Settlement Procedure 'A' below; in the case
of Notes with a quarterly Interest Reset
Date, on the third Wednesday of March, June,
September and December of each year; in the
case of Notes with a semi-annual Interest
Reset Date, on the third Wednesday of the
two months specified pursuant to Settlement
Procedure 'A' below; and in the case of
Notes with an annual Interest Reset Date, on
the third Wednesday of the month specified
pursuant to Settlement Procedure
B-7
'A' below; provided however, that if an
Interest Payment Date for Floating Rate
Book-Entry Notes would otherwise be a day
that is not a Business Day with respect to
such Floating Rate Book-Entry Notes, such
Interest Payment Date will be the next
succeeding Business Day with respect to such
Floating Rate Book-Entry Notes, except that
in the case of a LIBOR Note if such Business
Day is in the next succeeding calendar
month, such Interest Payment Date will be
the immediately preceding Business Day; and
provided, further, that in the case of a
Floating Rate Book-Entry Note issued between
a Record Date and an Interest Payment Date,
the first interest payment will be made on
the Interest Payment Date following the next
succeeding Record Date.
Notice of Interest Payment and Record Dates.
On the first Business Day of January, April,
July and October of each year, the Trustee
will deliver to the Company and DTC a
written list of Record Dates and Interest
Payment Dates that will occur with respect
to Book-Entry Notes during the six-month
period beginning on such first Business Day.
Promptly after each date upon which interest
is determined for Floating Rate Notes issued
in book-entry form, the Calculation Agent
will notify the Company, the Trustee and
Standard & Poor's Corporation of the
interest rates determined on such dates.
Calculation of Fixed Rate Book-Entry Notes.
Interest: Interest on Fixed Rate Book-Entry Notes
(including interest for partial periods)
will be calculated on the basis of a year
of twelve thirty-day months.
Floating Rate Book-Entry Notes. Interest
rates on Floating Rate Book-Entry Notes will
be determined as set forth in the form of
Notes. Interest on Floating Rate Book-Entry
Notes will be calculated on the basis of
actual days elapsed and a year of 360 days
except that in the case of Treasury Rate
Notes, interest will be
B-8
calculated on the basis of the actual number
of days in the year.
Payments of Payments of Interest. Promptly
Principal and after each Record Date, the Trustee
Interest: will deliver to the Company and DTC a
written notice specifying by CUSIP number
the amount of interest to be paid on each
Global Security (other than an Amortizing
Note) on the following Interest Payment
Date (other than an Interest Payment Date
coinciding with maturity or any earlier
redemption or repayment date) and the
total of such amounts. DTC will confirm
the amount payable on each such Global
Security on such Interest Payment Date by
reference to the daily bond reports
published by Standard & Poor's
Corporation. In the case of Amortizing
Notes, the Trustee will provide separate
written notice to the Company and DTC
prior to each Interest Payment Date at the
times and in the manner set forth in the
Letter of Representations. The Company
will pay to the Trustee, as paying agent,
the total amount of interest due on such
Interest Payment Date (and, in the case of
an Amortizing Note, principal and
interest) (other than at maturity), and
the Trustee will pay such amount to DTC at
the times and in the manner set forth
below under 'Manner of Payment.' If any
Interest Payment Date for a Fixed Rate
Book-Entry Note is not a Business Day, the
payment due on such day shall be made on
the next succeeding Business Day and no
interest shall accrue on such payment for
the period from and after such Interest
Payment Date.
Payments at Maturity or Upon Redemption or
Repayment. On or about the first Business
Day of each month, the Trustee will deliver
to the Company and DTC a written list of
principal and interest to be paid on each
Global Security (other than an Amortizing
Note) maturing either at maturity or on a
redemption or repayment date in the
following month. The Company and DTC will
confirm the amounts of such principal and
interest payments with
B-9
respect to each such Global Security on or
about the fifth Business Day preceding the
Maturity Date or redemption or repayment
date of such Global Security. In the case of
Amortizing Notes, the Trustee will provide
separate written notice to the Company and
DTC prior to each Maturity Date and any
redemption or repayment date, as the case
may be, at the times and in the manner set
forth in the Letter of Representations. The
Company will pay to the Trustee, as the
paying agent, the principal amount of such
Global Security, together with interest due
at such Maturity Date or redemption or
repayment date. The Trustee will pay such
amounts to DTC at the times and in the
manner set forth below under 'Manner of
Payment.'
Payments Not on Business Days. If any
Interest Payment Date or the Maturity Date
or redemption or repayment date of a Fixed
Rate Book-Entry Note is not a Business Day,
the payment due on such day shall be made on
the next succeeding Business Day and no
interest shall accrue on such payment for
the period from and after such Interest
Payment Date, Maturity Date or redemption or
repayment date, as the case may be. If any
Interest Payment Date or the Maturity Date
or redemption or repayment date for any
Floating Rate Book-Entry Note would fall on
a day that is not a Business Day with
respect to such Note, such Interest Payment
Date, Maturity Date or redemption or
repayment date will be the next following
day that is a Business Day with respect to
such Note, except that, in the case of a
Book-Entry LIBOR Note, if such Business Day
is in the next succeeding calendar month,
such Interest Payment Date, Maturity Date or
redemption or repayment date will be the
immediately preceding day that is a Business
Day with respect to such Note. Promptly
after payment to DTC of the principal and
interest due on the Maturity Date or
redemption or repayment date of a Global
Security, the Trustee will destroy such
Global Security and (upon Company request)
provide a certificate of
B-10
destruction in accordance with the terms of
the relevant Indenture and deliver it to the
Company. Upon the request of the
Company, the Trustee will deliver to the
Company a written statement indicating the
total principal amount of outstanding
Book-Entry Notes as of the immediately
preceding Business Day.
Manner of Payment. The total amount of any
principal, premium, if any, and interest due
on Global Securities on any Interest Payment
Date or at maturity or upon redemption or
repayment shall be paid by the Company to
the Trustee in funds available for immediate
use by the Trustee not later than 12:00 Noon
(New York City time) on such date. Prior to
12:00 Noon (New York City time) on each
Maturity Date or redemption or repayment
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 DTC) to an
account at the Federal Reserve Bank of New
York previously specified by DTC, in funds
available for immediate use by DTC, each
payment of interest or principal and
premium, if any, due on Global Securities on
any Maturity Date or redemption or repayment
date. On each Interest Payment Date or, if
any such date is not a Business Day, as soon
as possible thereafter, interest payments
and, in the case of Amortizing Notes,
interest and principal payments shall be
made to DTC in same day funds in accordance
with existing arrangements between the
Trustee and DTC. Thereafter on each such
date, DTC 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 the Book-Entry Notes
represented by such Global Securities are
recorded in the book-entry system maintained
by DTC. Neither the Company nor the Trustee
shall have any responsibility or liability
for the payment by DTC to such Participants
of the principal of and interest on the
Book-Entry Notes.
B-11
Withholding Taxes. The amount of any taxes
required under applicable law to be withheld
from any interest payment on a Book-Entry
Note will be determined and withheld by the
Participant, indirect participant in DTC or
other person responsible for forwarding
payments directly to the beneficial owner of
such Note.
Preparation of If any offer to purchase a Book-Entry
Pricing Note is accepted by or on behalf of the
Supplement: Company, the Company will prepare a
pricing supplement (a 'Pricing Supplement')
reflecting the terms of such Note and will
arrange to file such Pricing Supplement with
the Commission in accordance with the
applicable paragraph of Rule 424(b) under
the Act, will deliver the number of copies
of such Pricing Supplement to the relevant
Agent as such Agent shall reasonably request
by 12:00 Noon (New York City time) on the
Business Day following such acceptance. The
relevant Agent will cause such Pricing
Supplement to be delivered to the purchaser
of the Note.
In each instance that a Pricing Supplement
is prepared, the Agents receiving such
Pricing Supplement will affix the Pricing
Supplement to Prospectuses prior to their
use. Outdated Pricing Supplements, and the
Prospectuses to which they are attached
(other than those retained for files), will
be destroyed.
Settlement: The receipt by the Company of immediately
available funds in payment for a
Book-Entry Note and the authentication and
issuance of the Global Security
representing such Note shall constitute
'settlement' with respect to such Note.
All offers accepted by the Company will be
settled on the third Business Day pursuant
to the timetable for settlement set forth
below unless the Company and the purchaser
agree to settlement on another day.
B-12
Settlement Settlement Procedures with regard to
Procedures: each Book-Entry Note sold by the Company
to or through an Agent (unless otherwise
specified pursuant to a Terms Agreement, as
defined in the Distribution Agreement),
shall be as follows:
A. The relevant Agent will advise the
Company by telephone that such Note
is a Book-Entry Note and of the
following settlement information:
1. Principal amount.
2. Maturity Date.
3. In the case of a Fixed Rate
Book-Entry Note, the Interest Rate,
whether such Note will pay interest
annually or semi-annually and
whether such Note is an Amortizing
Note, and, if so, the amortization
schedule, or, in the case of a
Floating Rate Book-Entry Note, the
Initial Interest Rate (if known at
such time), Interest Payment
Date(s), Interest Payment Period,
Calculation Agent, Base Rate, Index
Maturity, Interest Reset Period,
Initial Interest Reset Date,
Interest Reset Dates, Spread or
Spread Multiplier (if any), Minimum
Interest Rate (if any), Maximum
Interest Rate (if any) and the
Alternate Rate Event Spread (if
any).
4. Redemption or repayment
provisions, if any.
5. Settlement date and time
(Original Issue Date).
6. Interest Accrual Date.
7. Price.
B-13
8. Agent's commission, if any,
determined as provided in the
Distribution Agreement.
9. Whether the Note is an OID Note,
and if it is an OID Note, the total
amount of OID, the yield to
maturity, the initial accrual period
OID and the applicability of
Modified Payment upon Acceleration
(and, if so, the Issue Price).
10. Whether the Agent is purchasing
the Note as principal.
11. Any other applicable Terms.
B. The Company through an authorized
representative will advise the Trustee
by telephone (confirmed immediately by
electronic transmission) or electronic
transmission (confirmed in writing at
any time on the same date) of the
information set forth in Settlement
Procedure 'A' above and the name of the
relevant Agent. The Trustee will then
assign a CUSIP number to the Global
Security representing such Note and will
notify the Company and the relevant
Agent of such CUSIP number by telephone
as soon as practicable.
C. The Trustee will enter a pending
deposit message through DTC's
Participant Terminal System, providing
the following settlement information to
DTC, the relevant Agent and Standard &
Poor's Corporation:
1. The information set forth in
Settlement Procedure 'A'.
2. The Initial Interest Payment
Date for such Note, the number of
days by which such date succeeds the
related DTC Record Date (which in
the case of
B-14
Floating Rate Notes which reset
daily or weekly, shall be the date
five calendar days immediately
preceding the applicable Interest
Payment Date and, in the case of all
other Notes, shall be the Record
Date as defined in the Note) and, if
known, amount of interest payable on
such Initial Interest Payment Date.
3. The CUSIP number of the Global
Security representing such Note.
4. Whether such Global Security
will represent any other
Book-Entry Note (to the extent
known at such time).
5. Whether such Note is an
Amortizing Note (by an appropriate
notation in the comments field of
DTC's Participant Terminal System).
6. The DTC participant number of
the institution through which
the Company will hold the
Book-Entry Note.
D. The Trustee will complete and
authenticate the Global Security
representing such Note in accordance
with the terms of the written order
of the Company then in effect.
E. DTC will credit such Note to the
Trustee's participant account at DTC.
F. The Trustee will enter an SDFS
deliver order through DTC's Participant
Terminal System instructing DTC to (i)
debit such Note to the Trustee's
participant account and credit such Note
to the relevant Agent's participant
account and (ii) debit such Agent's
settlement account and credit the
Trustee's settlement account for an
amount equal to the price of such
B-15
Note less the Agent's commission, if
any. The entry of such a deliver order
shall constitute a representation and
warranty by the Trustee to DTC that (a)
the Global Security representing such
Book-Entry Note has been issued and
authenticated and (b) the Trustee is
holding such Global Security pursuant to
the Medium Term Note Certificate
Agreement between the Trustee and DTC.
G. Unless the relevant Agent purchased such
Note as principal, such Agent will enter
an SDFS deliver order through DTC's
Participant Terminal System instructing
DTC (i) to debit such Note to such
Agent's participant account and credit
such Note to the participant accounts of
the Participants with respect to such
Note and (ii) to debit the settlement
accounts of such Participants and credit
the settlement account of such Agent for
an amount equal to the price of such
Note.
H. Transfers of funds in accordance with
SDFS deliver orders described in
Settlement Procedures 'F' and 'G' will
be settled in accordance with SDFS
operating procedures in effect on the
settlement date.
I. The Trustee will credit to the account
of the Company maintained at the
Trustee, in funds available for
immediate use in the amount transferred
to the Trustee in accordance with
Settlement Procedure 'F'.
J. Unless the relevant Agent purchased such
Note as principal, such Agent will
confirm the purchase of such Note to the
purchaser either by transmitting to the
Participants with respect to such Note a
confirmation order or orders through
DTC's institutional delivery system or
by
B-16
mailing a written confirmation to such
purchaser.
K. Monthly, the Trustee will send to the
Company a statement setting forth the
principal amount of Notes outstanding as
of that date under the Indenture and
setting forth a brief description of any
sales of which the Company has advised
the Trustee but which have not yet been
settled.
Settlement For sales by the Company of Book-Entry
Procedures Notes to or through an Agent unless
Timetable: otherwise specified pursuant to a Terms
Agreement) for settlement on the first
Business Day after the sale date, Settlement
Procedures 'A' through 'J' 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 sale date
B 12:00 Noon on the sale date
C 2:00 P.M. on the sale date
D 9:00 A.M. on settlement date
E 10:00 A.M. on settlement date
F-G 2:00 P.M. on settlement date
H 4:45 P.M. on settlement date
I-J 5:00 P.M. on settlement date
If a sale is to be settled more than one
Business Day after the sale date, Settlement
Procedures 'A', 'B' and 'C' shall be
completed as soon as practicable but no
later than 11:00 A.M., 12 Noon and 2:00
P.M., respectively, on the first Business
Day after the sale date. If the Initial
Interest Rate for a Floating Rate Book-Entry
Note has not been determined at the time
that Settlement Procedure 'A' is completed,
Settlement Procedure 'B' and 'C' shall be
completed as soon as such rate has been
determined but no later than 12 Noon and
2:00 P.M., respectively, on the second
Business Day before the settlement date.
Settlement Procedure 'H'
B-17
is subject to extension in accordance with
any extension of Fedwire closing deadlines
and in the other events specified in the
SDFS operating procedures in effect on the
settlement date.
If settlement of a Book-Entry Note is
rescheduled or canceled, the Trustee, after
receiving notice from the Company or the
relevant Agent, will deliver to DTC, through
DTC's Participant Terminal System, a
cancellation message to such effect by no
later than 2:00 P.M. on the Business Day
immediately preceding the scheduled
settlement date.
Failure to If the Trustee fails to enter an
Settle: SDFS deliver order with respect to a
Book-Entry Note pursuant to Settlement
Procedure 'F', the Trustee may deliver to
DTC, through DTC's Participant Terminal
System, as soon as practicable a withdrawal
message instructing DTC to debit such Note
to the Trustee's participant account,
provided that the Trustee's participant
account contains a principal amount of the
Global Security representing such Note that
is at least equal to the principal amount to
be debited. If a withdrawal message is
processed with respect to all the Book-Entry
Notes represented by a Global Security, the
Trustee will mark such Global Security
'canceled,' make appropriate entries in the
Trustee's records and send such canceled
Global Security to the Company. The CUSIP
number assigned to such Global
Security shall, in accordance with CUSIP
Service Bureau procedures, be canceled and
not immediately reassigned. If a withdrawal
message is processed with respect to one or
more, but not all, of the Book-Entry Notes
represented by a Global Security, the
Trustee will exchange such Global Security
for two Global Securities, one of which
shall represent such Book-Entry Note or
Notes and shall be canceled immediately
after issuance and the other of which shall
represent the
B-18
remaining Book-Entry Notes previously
represented by the surrendered Global
Security and shall bear the CUSIP number of
the surrendered Global Security.
If the purchase price for any Book-Entry
Note is not timely paid to the Participants
with respect to such Note by the beneficial
purchaser thereof (or a person, including an
indirect participant in DTC, acting on
behalf of such purchaser), such Participants
and, in turn, the relevant Agent may enter
SDFS deliver orders through DTC's
Participant Terminal System reversing the
orders entered pursuant to Settlement
Procedures 'F' and 'G', respectively.
Thereafter, the Trustee will deliver the
withdrawal message and take the related
actions described in the preceding
paragraph.
Notwithstanding the foregoing, upon any
failure to settle with respect to a
Book-Entry Note, DTC 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 one or more, but not all, of the
Book-Entry Notes to have been represented by
a Global Security, the Trustee will provide,
in accordance with Settlement Procedures 'D'
and 'F', for the authentication and issuance
of a Global Security representing the
Book-Entry Notes to be represented by such
Global Security and will make appropriate
entries in its records.
B-19
PART II: ADMINISTRATIVE PROCEDURES FOR CERTIFICATED NOTES
The Trustee will serve as registrar in connection with the
Certificated Notes.
Issuance: Each Certificated Note will be dated and
issued as of the date of its
authentication by the Trustee. Each
Certificated Note will bear an Original
Issue Date, which will be (i) with respect
to an original Certificated Note (or any
portion thereof), its original issuance
date (which will be the settlement date)
and (ii) with respect to any Certificated
Note (or portion thereof) issued
subsequently upon transfer or exchange of
a Certificated Note or in lieu of a
destroyed, lost or stolen Certificated
Note, the original issuance date of the
predecessor Certificated Note, regardless
of the date of authentication of such
subsequently issued Certificated Note.
Registration: Certificated Notes will be issued only in
fully registered form without coupons.
Transfers and A Certificated Note may be presented
Exchanges: for transfer or exchange at the corporate
trust office of the Trustee. Certificated
Notes will be exchangeable for other
Certificated Notes having identical terms
but different denominations without service
charge. Certificated Notes will not be
exchangeable for Book-Entry Notes.
Maturities: Each Certificated Note will mature on a date
selected by the Purchaser and agreed to by
the Company, such date being not less than
nine months from date of issue.
Currency: The currency denomination with respect to
any Certificated Note and the payment of
interest and the repayment of principal with
respect to any such Certificated Note shall
be as set forth therein and in the
applicable Pricing Supplement.
Denominations: Unless otherwise provided in a Prospectus
Supplement, the denomination of any
Certificated Note will be a minimum of U.S.
$1,000 or any amount in excess
B-20
thereof that is an integral multiple of U.S.
$1,000 or the equivalent, as determined
pursuant to the provisions of the applicable
Prospectus Supplement, of U.S. $1,000
(rounded down to an integral multiple of
1,000 units of such Specified Currency) and
any amount in excess thereof which is an
integral multiple of 1,000 units of such
Specified Currency.
Interest: General. Interest on each Certificated
Note will accrue from the Original Issue
Date of such Note for the first interest
period and from the most recent date to
which interest has been paid for all
subsequent interest periods. Each payment
of interest on a Certificated Note will
include interest accrued to but excluding
the Interest Payment Date; provided that
in the case of Floating Rate Notes which
reset daily or weekly, interest payments
will include interest accrued to and
including the Record Date immediately
preceding the Interest Payment Date,
except that at maturity or earlier
redemption or repayment, the interest
payable will include interest accrued to,
but excluding the Maturity Date or the
date of redemption or repayment, as the
case may be.
Fixed Rate Certificated Notes. Unless
otherwise specified pursuant to Settlement
Procedure 'A' below, interest payments on
Fixed Rate Certificated Notes, other than
Amortizing Notes, will be made annually on
March 1 or semiannually on March 1 and
September 1 of each year and at maturity or
upon earlier redemption or repayment, and
Certificated Amortizing Notes will pay
principal and interest semiannually each
March 1 and September 1, or quarterly each
March 1, June 1, September 1 and December 1,
and at maturity or upon earlier redemption
or repayment; provided, however, that in the
case of Certificated Fixed Rate Notes issued
between a Record Date and an Interest
Payment Date, the first interest payment
will be made on the Interest Payment Date
following the next succeeding Record Date.
B-21
Floating Rate Certificated Notes. Interest
payments will be made on Floating Rate
Certificated Notes monthly, quarterly,
semi-annually or annually. Interest will be
payable, in the case of Floating Rate
Certificated Notes with a daily, weekly or
monthly Interest Reset Date, on the third
Wednesday of each month or on the third
Wednesday of March, June, September and
December, as specified pursuant to
settlement procedure 'A' below; in the case
of Notes with a quarterly interest Payment
Reset Date, on the third Wednesday of March,
June, September and December of each year;
in the case of Notes with a semi-annual
Interest Reset Date, on the third Wednesday
of the two months specified pursuant to
Settlement Procedure 'A' below; and in the
case of Notes with an annual Interest Reset
Date, on the third Wednesday of the month
specified pursuant to Settlement Procedure
'A' below; provided, however, that if an
Interest Payment Date for Floating Rate
Certificated Notes would otherwise be a day
that is not a Business Day with respect to
such Floating Rate Certificated Notes, such
Interest Payment Date will be the next
succeeding Business Day with respect to such
Floating Rate Certificated Notes, except
that in the case of a LIBOR Note if such
Business Day is in the next succeeding
calendar month, such Interest Payment Date
will be the immediately preceding Business
Day; and provided, further, that in the case
of a Floating Rate Certificated Note issued
between a Record Date and an Interest
Payment Date, the first interest payment
will be made on the Interest Payment Date
following the next succeeding Record Date.
Calculation of Fixed Rate Certificated Notes.
Interest: Interest on Fixed Rate Certificated Notes
(including interest for partial periods)
will be calculated on the basis of a year
of twelve thirty-day months.
Floating Rate Certificated Notes. Interest
rates on Floating Rate
B-22
Certificated Notes will be determined as set
forth in the form of such Notes. Interest on
Floating Rate Certificated Notes will be
calculated on the basis of actual days
elapsed and a year of 360 days, except that
in the case of Treasury Rate Notes, interest
will be calculated on the basis of the
actual number of days in the year.
Payments of The Trustee will pay the principal
Principal and amount of each Certificated Note at
Interest: maturity or upon redemption or repayment
upon presentation and surrender of such
Note to the Trustee. The Company will pay
the Trustee in immediately available funds
and the Trustee, upon receipt of those
funds, will pay the holder of such Note.
Certificated Notes presented for payment
to the Trustee at maturity or upon
redemption or repayment for payment will
be destroyed by the Trustee and a
certificate of destruction will be
delivered to the Company. Unless
otherwise specified in the applicable
pricing supplement, all interest payments
on a Certificated Note (other than
interest due at maturity or upon
redemption or repayment) will be made by
check drawn on the Trustee (or another
person appointed by the Trustee) and
mailed by the Trustee to the person
entitled thereto as provided in such Note
and the relevant Indenture; provided,
however, that (i) the holder of
$10,000,000 or more of Notes having the
same Interest Payment Date will be
entitled to receive payment by wire
transfer of immediately available funds
and (ii) unless otherwise specified in the
applicable Pricing Supplement or unless
alternative arrangements are made,
payments on Notes in a currency other than
U.S. dollars will be made by wire transfer
of immediately available funds to an
account maintained by the payee with a
bank located outside the United States and
the holder of such Notes will provide the
Trustee with the appropriate wire transfer
instructions. Following each Record Date,
the Trustee will furnish the Company with
B-23
a list of interest payments to be made on
the following Interest Payment Date for each
Certificated Note and in total for all
Certificated Notes. Interest at maturity or
upon redemption or repayment will be payable
to the person to whom the payment of
principal is payable. The Trustee will
provide monthly to the Company lists of
principal and interest, to the extent
ascertainable, to be paid on Certificated
Notes maturing or to be redeemed in the next
month. The Trustee will be responsible for
withholding taxes on interest paid on
Certificated Notes as required by applicable
law.
If any Interest Payment Date or the Maturity
Date or redemption or repayment date of a
Fixed Rate Certificated Note is not a
Business Day, the payment due on such day
shall be made on the next succeeding
Business Day and no interest shall accrue on
such payment for the period from and after
such Interest Payment Date, Maturity Date or
redemption or repayment date, as the case
may be. If any Interest Payment Date or the
Maturity Date or redemption or repayment
date for any Certificated Floating Rate Note
would fall on a day that is not a Business
Day with respect to such Note, such Interest
Payment Date, Maturity Date or redemption or
repayment date will be the following day
that is a Business Day with respect to such
Note, except that, in the case of a
Certificated LIBOR Note, if such Business
Day is in the next succeeding calendar
month, such Interest Payment Date shall be
the immediately preceding day that is a
Business Day with respect to such
Certificated LIBOR Note.
Preparation of If any offer to purchase a Certificated
Pricing Note is accepted by or on behalf of the
Supplement: Company, the Company will prepare a
pricing supplement (a 'Pricing Supplement')
reflecting the terms of such Note and will
arrange to file such Pricing Supplement with
the Commission in accordance with the
applicable paragraph of Rule 424(b) under
the Act, will deliver
B-24
the number of copies of such Pricing
Supplement to the relevant Agent as such
Agent shall reasonably request by 12:00 Noon
(New York City time) on the Business Day
following such acceptance. The relevant
Agent will cause such Pricing Supplement to
be delivered to the purchaser of the Note.
In each instance that a Pricing Supplement
is prepared, the Agents receiving such
Pricing Supplement will affix the Pricing
Supplement to Prospectuses prior to their
use. Outdated Pricing Supplements, and the
Prospectuses to which they are attached
(other than those retained for files), will
be destroyed.
Settlement: The receipt by the Company of immediately
available funds in exchange for an
authenticated Certificated Note delivered
to the relevant Agent and such Agent's
delivery of such Note against receipt of
immediately available funds shall
constitute 'settlement' with respect to
such Note. All offers accepted by the
Company will be settled on or before the
third Business Day next succeeding the
date of acceptance pursuant to the
timetable for settlement set forth below,
unless the Company and the purchaser agree
to settlement on another day.
Settlement Settlement Procedures with regard to
Procedures: each Certificated Note sold by the Company
to or through an Agent (unless otherwise
specified pursuant to a Terms Agreement)
shall be as follows:
A. The relevant Agent will advise the
Company by telephone that such Note
is a Certificated Note and of the
following settlement information:
1. Name in which such Note is to
be registered ('Registered
Owner') and whether the Agent is
purchasing the Note as
principal.
B-25
2. Address of the Registered Owner
and address for payment of
principal and interest.
3. Taxpayer identification number
of the Registered Owner (if
available).
4. Principal amount.
5. Maturity Date.
6. In the case of a Fixed Rate
Certificated Note, the Interest
Rate, whether such Note will pay
interest annually or semi-annually
and whether such Note is an
Amortizing Note and, if so, the
amortization schedule, or, in the
case of a Floating Rate Certificated
Note, the Initial Interest Rate (if
known at such time), Interest
Payment Date(s), Interest Payment
Period, Calculation Agent, Base
Rate, Index Maturity, Interest Reset
Period, Initial Interest Reset Date,
Interest Reset Dates, Spread or
Spread Multiplier (if any), Minimum
Interest Rate (if any), Maximum
Interest Rate (if any) and the
Alternate Rate Event Spread (if
any).
7. Redemption or repayment
provisions, if any.
8. Settlement date and time
(Original Issue Date).
9. Interest Accrual Date.
10. Price.
11. Agent's commission, if any,
determined as provided in the
Distribution Agreement.
12. Denominations.
B-26
13. Specified Currency.
14. Whether the Note is an OID
Note, and if it is an OID Note, the
total amount of OID, the yield to
maturity, the initial accrual period
OID and the applicability of
Modified Payment upon Acceleration
(and if so, the Issue Price).
15. Any other applicable Terms.
B. The Company through an authorized
representative will advise the Trustee
by telephone or electronic transmission
(confirmed in writing at any time on the
sale date) of the information set forth
in Settlement Procedure 'A' above.
C. The Company will have delivered to the
Trustee a pre-printed four-ply packet
for such Note, which packet will contain
the following documents in forms that
have been approved by the Company, the
relevant Agent and the Trustee:
1. Note with customer confirmation.
2. Stub One - For the Trustee.
3. Stub Two - For the relevant
Agent.
4. Stub Three - For the Company.
D. The Trustee will complete such Note
and authenticate such Note and deliver
it (with the confirmation) and Stubs One
and Two to the relevant Agent, and such
Agent will acknowledge receipt of the
Note by stamping or otherwise marking
Stub One and returning it to the
Trustee. Such delivery will be made only
against acknowledgment of the above
mentioned receipt. In the event that the
instructions given by such Agent for
payment to the account of the
B-27
Company are revoked, the Company will as
promptly as possible wire transfer to
the account of such Agent an amount of
immediately available funds equal to the
amount of such payment made.
E. Unless the relevant Agent purchased such
Note as principal, such Agent will
deliver such Note (with confirmation) to
the customer against payment in
immediately payable funds. Such Agent
will obtain the acknowledgment of
receipt of such Note by retaining Stub
Two.
F. The Trustee will send Stub Three to the
Company by first-class mail.
Periodically, the Trustee will also send
to the Company a statement setting forth
the principal amount of the Notes
outstanding as of that date under the
Indenture and setting forth a brief
description of any sales of which the
Company has advised the Trustee but
which have not yet been settled.
Settlement For sales by the Company of
Procedures Certificated Notes to or through an
Timetable: Agent (unless otherwise specified pursuant
to a Terms Agreement), Settlement
Procedures 'A' through 'F' set forth above
shall be completed on or before the
respective times (New York City time) set
forth below:
Settlement
Procedure Time
---------- ----
A 2:00 P.M. on day before
settlement date
B 3:00 P.M. on day before
settlement date
C-D 2:15 P.M. on settlement date
E 3:00 P.M. on settlement date
F 5:00 P.M. on settlement date
B-28
Failure to If a purchaser fails to accept
Settle: delivery of and make payment for any
Certificated Note, the relevant Agent will
notify the Company and the Trustee by
telephone and return such Note to the
Trustee. Upon receipt of such notice, the
Company will immediately wire transfer to
the account of the relevant Agent an amount
equal to the amount previously credited
thereto in respect of such Note. Such wire
transfer will be made on the settlement
date, if possible, and in any event not
later than the Business Day following the
settlement date. If the failure shall have
occurred for any reason other than a default
by such Agent in the performance of its
obligations hereunder and under the
Distribution Agreement with the Company,
then the Company will reimburse such Agent
on an equitable basis for its loss of the
use of the funds during the period when they
were credited to the account of the Company
(reimbursement for loss of the use of such
funds shall be based on the federal funds
effective rate then in effect). Immediately
upon receipt of the Certificated Note in
respect of which such failure occurred, the
Trustee will mark such Note 'canceled,' make
appropriate entries in the Trustee's records
and send such Note to the Company.
B-29
EXHIBIT C1
FORM OF OPINION OF
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
_______ __, 1995
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
This opinion is being rendered to you pursuant to the Distribution
Agreement dated November 9, 1995 (the 'Distribution Agreement') among you and
▇▇▇ ▇▇▇▇▇ and Company (the 'Company'), relating to the issuance and sale by the
Company of up to $500,000,000 (or the equivalent thereof in a foreign currency
or composite currency) aggregate principal amount of its Medium-Term Notes
(hereinafter called the 'Notes').
We have examined the corporate proceedings with respect to (1) the
authorization of the execution by the Company of (i) the Indenture, dated as of
February 1, 1991 (the 'Indenture'), between the Company and Citibank, N.A., as
Trustee (the 'Trustee'), and (ii) the Distribution Agreement; (2) the
authorization of the issuance of the Notes under the Indenture; (3) the
authorization of the sale of the Notes in accordance with the provisions of the
Distribution Agreement and the Medium-Term Note Administrative Procedures
referred to in the Distribution Agreement; and (4) the Registration Statement on
Form S-3 (Reg. No. 33-58977, relating to the registration under the Securities
Act of 1933, as amended (the 'Act'), of certain debt securities (including the
Notes) of the Company, including the exhibits thereto and all items incorporated
therein by reference pursuant to Item 12 of Form S-3 (the 'Incorporated
Documents') (such Registration Statement at
C1-1
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. 2 _______ __, 1995
the time it became effective on June 1, 1995 and the Prospectus dated June 1,
1995, constituting a part of such Registration Statement, as supplemented by a
Prospectus Supplement dated November 9, 1995, relating to the Notes, in the form
thereof transmitted for filing with the Securities and Exchange Commission (the
'Commission') pursuant to Rule 424(b)(2) under the Act, including the
Incorporated Documents, being hereinafter called, respectively, the
'Registration Statement' and the 'Prospectus').
In arriving at these opinions, we have relied, among other things,
upon our examination of the corporate records of the Company and certificates
and representations of officers of the Company and of public officials.
Based upon the foregoing, it is our opinion that:
(1) No consent or approval by, notice to or registration with any New
York or Federal governmental authority (other than compliance with any required
Blue Sky or state securities laws) is required on the part of the Company or ▇▇▇
▇▇▇▇▇ Industries, Inc., a Delaware corporation, in connection with the
consummation by the Company of the transactions contemplated by the Distribution
Agreement.
(2) The Indenture has been duly qualified under the Trust Indenture
Act of 1939, as amended, and assuming due authorization, execution and delivery
thereof by the Company and the Trustee, the Indenture constitutes a valid and
legally binding instrument of the Company enforceable in accordance with its
terms and the terms of the Trust Indenture Act of 1939, as amended, except as
(i) the enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and (ii) rights of
acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability.
(3) The Distribution Agreement, assuming due execution and delivery
thereof by the Company and the Agents, constitutes a valid and legally binding
obligation of the Company enforceable in accordance with its terms except as (i)
the enforceability thereof may be limited by bankruptcy, insolvency or similar
laws affecting creditors' rights generally, (ii) rights of acceleration and the
C1-2
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. 3 _______ __, 1995
availability of equitable remedies may be limited by equitable principles of
general applicability and (iii) rights to indemnity and contribution may be
limited by applicable law.
(4) The Notes, when duly executed by the Company, authenticated by the
Trustee and duly delivered against payment therefor in accordance with the
provisions of the Indenture and the Distribution Agreement, will be entitled to
the benefits of the Indenture and will constitute valid and legally binding
obligations of the Company enforceable in accordance with their respective terms
except as (i) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and (ii) rights
of acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability. The opinions expressed in this
paragraph 4 are subject to the due determination by the Company, prior to the
issuance of the Notes, of the specific principal amounts of and interest rates
(or the method of determining such interest rates), original issue dates,
maturity dates, and, if applicable, initial interest rates, interest rate bases,
index maturities, spreads, maximum or minimum interest rates, interest payment
dates, interest payment periods, interest rate reset periods, and interest reset
dates for such Notes, the communication of instructions to the Trustee from any
authorized representative of the Company as to such information, the name or
names in which each Note is to be registered, any other information which such
officer or representative may conclude is advisable or appropriate and, with
respect to Notes denominated or payable in currencies or currency units other
than United States Dollars, Notes the principal of which will amortize, and
Notes the principal of which or the interest on which will be determined by
reference to one or more commodity prices, equity indices, specified currencies,
currency units, or financial or non-financial indices, the terms and forms of
such Notes.
(5) ▇▇▇ ▇▇▇▇▇ Industries, Inc. has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the State
of Delaware.
(6) The statements in the Prospectus under the captions 'Description
of Securities,' 'Plan of Distribution'
C1-3
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. 4 _______ __, 1995
(other than information contained therein provided in writing by the Agents),
'Description of Notes' and 'Certain Federal Tax Consequences' and Item 15 of
Part II of the Registration Statement, fairly present or presented, at the time
such Prospectus or Registration Statement was filed, in all material respects
the information called therefor and fairly summarize or summarized in all
material respects the matters referred to therein.
(7) The Registration Statement (except as to financial statements and
other financial or statistical data contained therein as to which we express no
opinion) complied at the time it became effective, and the Prospectus (except as
to financial statements and other financial or statistical data contained
therein, as to which we express no opinion) including the Incorporated Documents
as of the time they were filed, complied or comply, as to form in all material
respects with the applicable provisions of the Act, the Securities Exchange Act
of 1934, as amended and the rules and regulations of the Commission under each
such statute.
(8) Neither the execution and filing of the Registration Statement or
the Indenture, the execution, issuance and delivery of the Notes nor the
consummation of the transactions contemplated thereby nor compliance by the
Company with any of the provisions thereof will violate the Delaware General
Corporation Law or any New York or Federal statute, rule or regulation
applicable to the Company or ▇▇▇ ▇▇▇▇▇ Industries, Inc., or any of their
properties or assets.
To the extent of matters brought to our attention and upon the basis
of information furnished to us, we know of no facts that lead us to believe that
the Registration Statement or Prospectus (except as to financial statements and
other financial and statistical data contained therein, as to which we express
no opinion) contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading. In rendering the opinion contained in this
paragraph, we have not made any independent investigation or verification of
facts or law contained in, and do not assume any responsibility for the
accuracy, completeness or fairness of the statements contained in, the
Registration Statement and Prospectus
C1-4
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. 5 _______ __, 1995
other than those portions thereof contained in or under the headings
'Description of Securities,' 'Plan of Distribution' (other than information
contained therein provided in writing by the Agents), 'Description of Notes' and
'Certain Federal Tax Consequences' in the Prospectus and Item 15 of Part II of
the Registration Statement.
The opinions set forth in paragraphs (6) and (7) and the preceding
paragraph are subject to the filing by the Company, in accordance with the
provisions of the Act and the rules and regulations thereunder, of a supplement
or supplements to the Prospectus in connection with the offering of Notes,
setting forth the principal amounts, interest rates (or the method of
determining such interest rates), original issue dates, maturity dates and, if
applicable, initial interest rates, interest rate bases, index maturities,
spreads, maximum and minimum interest rates, interest payment dates, interest
payment periods, interest rate reset periods, interest reset dates and any other
material information with respect to any offering of such Notes.
With respect to the opinions referred to in paragraphs 4 (except as to
due authorization of the Notes) and 7 and the second preceding paragraph, we
wish to note that they do not address any application of the Commodity Exchange
Act, as amended, or the rules, regulations or interpretations of the Commodity
Futures Trading Commission to Notes the payments of principal or interest on
which will be determined by reference to one or more currency exchange rates,
commodity prices, equity indices or other factors.
We are members of the bar of the State of New York and we express no
opinion as to matters governed by the laws of any other jurisdiction (other than
the federal laws of the United States of America and the Delaware General
Corporation Law). As to matters governed by the laws of the State of Indiana, we
have relied upon the opinion dated the date hereof of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇,
Deputy General Counsel and Secretary of the Company.
C1-5
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. 6 _______ __, 1995
We hereby consent that ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Deputy General Counsel
and Secretary of the Company, may rely upon this opinion as if this opinion were
addressed to him.
Very truly yours,
C1-6
EXHIBIT C2
FORM OF OPINION OF
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
DEPUTY GENERAL COUNSEL AND SECRETARY
_______ __, 1995
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
This opinion is being rendered to you pursuant to the Distribution
Agreement, dated November 9, 1995 (hereinafter called the 'Distribution
Agreement'), among you and ▇▇▇ ▇▇▇▇▇ and Company (hereinafter called the
'Company'), relating to the issuance and sale by the Company of up to
$500,000,000 (or the equivalent thereof in a foreign currency or composite
currency) aggregate principal amount of its Medium-Term Notes (hereinafter
called the 'Notes'). I am the Deputy General ▇▇▇▇▇▇▇ and Secretary of the
Company.
I have examined the corporate proceedings of the Company with respect
to (1) the organization of the Company pursuant to its Articles of
Incorporation; (2) the authorization of the execution by the Company of the
Indenture dated as of February 1, 1991 (the 'Indenture') between the Company and
Citibank, N.A., as Trustee (the 'Trustee'); (3) the authorization of the
issuance of the Notes under the Indenture; (4) the authorization of the sale of
the Notes in accordance with the provisions of the Distribution Agreement and
the Medium-Term Note Administrative Procedures referred to in the Distribution
Agreement; and (5) the Registration Statement on Form S-3
C2-1
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. 2 _______ __, 1995
(Reg. No. 33-58977, relating to the registration under the Securities Act of
1933, as amended (the 'Act'), of certain debt securities (including the Notes)
of the Company, including the exhibits thereto and all items incorporated
therein by reference pursuant to Item 12 of Form S-3 (the 'Incorporated
Documents') (such Registration Statement at the time it became effective on June
1, 1995 and the Prospectus dated June 1, 1995 constituting a part of such
Registration Statement, as supplemented by a Prospectus Supplement dated
November 9, 1995 relating to the Notes, in the form thereof filed with the
Securities and Exchange Commission (the 'Commission') pursuant to Rule 424(b)(2)
under the Act, including the Incorporated Documents, being hereinafter called,
respectively, the 'Registration Statement' and the 'Prospectus').
In preparing this opinion, I have examined and relied upon, among
other things, such certificates of public officials and of officers and
employees of the Company and such originals or copies certified or otherwise
identified to my satisfaction, of corporate documents and records of the Company
as I deemed necessary or appropriate for the purposes hereof.
Based upon the foregoing, it is my opinion that:
(1) The Company has been duly incorporate in, and is a validly
existing corporation under the laws of, the State of Indiana and has the
corporate power and authority to carry on its business which it is now
conducting and to own or lease and operate its assets and properties, as
described in the Prospectus.
(2) No consent or approval by, notice to or registration with any
Indiana governmental authority (other than compliance with the blue sky or
securities laws, as to which I give no opinion) is required on the part of the
Company in connection with the consummation by the Company of the transactions
contemplated by the Distribution Agreement.
(3) The Distribution Agreement has been duly and validly authorized,
executed and delivered by the Company.
(4) The Indenture has been duly and validly authorized, executed and
delivered by the Company.
C2-2
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. 3 _______ __, 1995
(5) The issuance and sale of the Notes by the Company pursuant to the
Distribution Agreement and any applicable Terms Agreement have been duly and
validly authorized by all necessary corporate action. The opinion expressed in
this paragraph 4 is subject to the due determination by the Company, prior to
the issuance of any Notes, of the specific principal amounts of, and interest
rates (or the method of determining such interest rates), original issue dates,
maturity dates, and, if applicable, initial interest rates, interest rate bases,
index maturities, spreads, maximum or minimum interest rates, interest payment
dates, interest payment periods, interest rate reset periods and interest reset
dates for such Notes, the communication of instructions to the Trustee from any
authorized representative of the Company as to such information, the name or
names in which each Note is to be registered and, with respect to Notes
denominated or payable in currencies or currency units other than United States
Dollars, Notes the principal of which will amortize, and Notes the principal of
which or the interest on which will be determined by reference to one or more
commodity prices, equity indices, specified currencies, currency units, or
financial or non-financial indices, the terms and forms of such Notes.
(6) Neither the execution and filing of the Registration Statement,
the execution and delivery of the Indenture, the execution, issuance and
delivery of the Notes nor the consummation of the transactions contemplated
thereby nor compliance by the Company with any of the provisions thereof will:
a. violate, or result in a breach of any provision of, or constitute a
default (or an event which, with notice or lapse of time or both, would
constitute a default) under, or result in the termination of, or accelerate the
performance required by, or subject to any encumbrance, easement or other
restriction that would detract materially from its value or impair its use in
the operation of the business any of the properties or assets of the Company or
any of its significant subsidiaries (as defined in the Distribution Agreement)
under any of the terms, conditions or provisions of (i) the Articles of
Incorporation or the By-laws of the Company or its significant subsidiaries (as
defined in the Distribution Agreement), or (ii) to my knowledge, any note, bond,
C2-3
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. 4 _______ __, 1995
mortgage, indenture, deed of trust, license, agreement or other instrument or
obligation known to me to which the Company or any of its significant
subsidiaries (as defined in the Distribution Agreement) is a party or by which
they or any of their properties or assets may be bound or affected, or
b. violate any Indiana statute, rule or regulation (other than Indiana
securities or Blue Sky laws, as to which I give no opinion) or, to my knowledge,
any order, writ, injunction or decree applicable to the Company, any of its
significant subsidiaries (as defined in the Distribution Agreement) or any of
their properties or assets.
6. After due inquiry, I am aware of no action, suit or proceeding
pending or threatened against or affecting the Company or any of its significant
subsidiaries (as defined in the Distribution Agreement) or any of their
respective properties before or by any court, governmental official, commission,
board or other administrative agency, which would have a material adverse effect
on the consolidated results of operations or financial position of the Company
and its subsidiaries, taken as a whole, except as may be disclosed in the
Registration Statement or the Prospectus.
I am a member of the bar of the State of Indiana, and I express no
opinion as to matters governed by the laws of any other jurisdiction (other than
federal laws of the United States of America).
I hereby consent that Messrs. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ may rely upon this
opinion as if this opinion were addressed to them.
Very truly yours,
C2-4
EXHIBIT C-3
FORM OF OPINION OF
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
_______ __, 1995
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
We have acted as counsel for each of you, the selling agents (the 'Agents')
named in the Distribution Agreement dated November 9, 1995 (the 'Distribution
Agreement') among you and ▇▇▇ ▇▇▇▇▇ and Company, an Indiana corporation (the
'Company'), under which you have agreed to act as agent for the Company to
solicit purchasers for, or to purchase from the Company as principal, up to
$500,000,000 (or the equivalent thereof in foreign currencies or composite
currencies) aggregate initial public offering price of the Company's Medium-Term
Notes (the 'Notes'). The Notes will be issued pursuant to the provisions of an
indenture dated as of February 1, 1991 (the 'Indenture') between the Company and
Citibank, N.A., as Trustee (the 'Trustee').
We have examined originals or copies, certified or otherwise identified to
our satisfaction, of such documents, corporate records, certificates of public
officials and other instruments as we have deemed necessary or advisable for the
purpose of rendering this opinion, including those relating to the
authorization, execution and delivery by the Company of the Indenture and the
Distribution Agreement, and the authorization of the Notes by the Company.
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. 2 _______ __, 1995
We have participated in the preparation of the Company's registration
statement on Form S-3 (Registration No. 33-58977) (other than the documents
incorporated by reference in the prospectus included therein (the 'Incorporated
Documents')) filed with the Securities and Exchange Commission (the
'Commission') pursuant to the provisions of the Securities Act of 1933, as
amended (the 'Act'), registering $500,000,000 aggregate initial public offering
price of debt securities to be issued from time to time by the Company. Although
we did not participate in the preparation of the Incorporated Documents, we have
reviewed such documents. In addition, we have reviewed evidence that on June 1,
1995 the registration statement was declared effective under the Act and that
the Indenture was qualified under the Trust Indenture Act of 1939, as amended
(the 'Trust Indenture Act'). Such registration statement in the form it became
effective is referred to herein as the 'Registration Statement' and the
prospectus included in the Registration Statement at time it became effective,
together with the Prospectus Supplement dated November 9, 1995 in the form in
which it was filed pursuant to Rule 424(b)(2) under the Act, is referred to
herein as the 'Prospectus', and such terms include the Incorporated Documents.
Based upon the foregoing, we are of the opinion that:
(1) The Indenture has been duly qualified under the Trust Indenture Act and
has been duly authorized, executed and delivered by the Company and is a
valid and binding agreement of the Company;
(2) When the Notes have been executed by the Company and authenticated by
the Trustee or its duly appointed agent in accordance with the provisions of
the Indenture and delivered to and duly paid for by the purchasers thereof,
they will be entitled to the benefits of the Indenture and will be valid and
binding obligations of the Company; and
(3) The Distribution Agreement has been duly authorized, executed and
delivered by the Company.
We have considered the matters required to be included in the Registration
Statement and Prospectus and the information contained therein. We are of the
opinion
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. 3 _______ __, 1995
that the statements in the Prospectus under the captions 'Description of
Securities', 'Description of Notes' and 'Plan of Distribution', in each case
insofar as such statements constitute summaries of documents referred to
therein, fairly present the information called for with respect to such
documents and fairly summarize the matters referred to therein.
We have not ourselves checked the accuracy or completeness of, or otherwise
verified, the information furnished with respect to other matters in the
Registration Statement or the Prospectus, but we have generally reviewed and
discussed with your representatives and with certain officers and employees of,
and counsel and independent public accountants for, the Company the information
furnished, whether or not subject to our check and verification. On the basis of
such consideration, review and discussion, but without independent check or
verification, except as stated, (A) we are of the opinion that the Registration
Statement and Prospectus (except for financial statements and other financial
data as to which we do not express any opinion) comply as to form in all
material respects with the Act and the applicable rules and regulations of the
Commission thereunder, (B) we believe that (except for financial statements and
other financial data as to which we do not express any belief and except for
that part of the Registration Statement that constitutes the Statement of
Eligibility and Qualification (Form T-1) of the Trustee) the Registration
Statement on the date hereof does not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading, and (C) we believe that (except
as to financial statements and other financial data as to which we do not
express any belief) the Prospectus as of the date hereof does not contain any
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, except that the opinion and belief set
forth in clauses (A) and (C) above do not cover information concerning an
offering of particular Notes to the extent such information will be set forth in
a supplement to the Prospectus.
We wish to point out that the preceding paragraph does not address any
application of the Commodity Exchange
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. 4 _______ __, 1995
Act, as amended, or the rules, regulations or interpretations of the Commodity
Futures Trading Commission to Notes the payments of principal or interest on
which will be determined by reference to one or more currency exchange rates,
commodity prices, equity indices or other factors. In addition, for the purpose
of the opinion in paragraph (2) above, we have, with your approval, assumed that
(i) the Notes will conform to the forms attached to the certificate delivered to
you today executed by the Secretary of the Company and will be completed in
accordance with the requirements of the Indenture and the Administrative
Procedures (as defined in the Distribution Agreement) and (b) none of the terms
of the Notes not contained in the forms examined by us will violate any
applicable law or be unenforceable. In connection with our opinion in paragraph
(2) above, we note that, as of the date of this opinion, a judgment for money in
an action based on Notes payable in foreign or composite currencies in a federal
or state court in the United States ordinarily would be enforced in the United
States only in United States dollars. The date used to determine the rate of
conversion of the foreign or composite currency in which a particular Note is
payable into United States dollars will depend upon various factors, including
which court renders the judgment.
In addition we wish to advise you that no opinion is expressed herein
concerning any change after the date hereof in applicable law or in the facts we
have relied upon in expressing this opinion.
We have examined the opinions dated the date hereof of ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇▇, Deputy General Counsel and Secretary of the Company, and ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, counsel to the Company, delivered to you pursuant to Sections
4(b)(ii) and 4(b)(i), respectively, of the Distribution Agreement, and we
believe that such opinions are responsive to the requirements of the
Distribution Agreement.
We have also examined the letter dated the date hereof of Ernst & Young
LLP, independent certified public accountants, relating to the financial
statements and other information contained or incorporated by reference in the
Registration Statement and the other matters referred to in such letter,
delivered to you pursuant to Section 4(d) of the Distribution Agreement. We
participated in discussions with your representatives and representatives of the
Company
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▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated
▇▇▇▇▇▇▇, ▇▇▇▇▇ & Co. 5 _______ __, 1995
relating to the form of such letter, and we believe that it is substantially in
the form agreed to.
We are members of the Bar of the State of New York and the foregoing
opinion is limited to the laws of the State of New York and the federal laws of
the United States of America. In rendering the foregoing opinion, we have
relied, without independent investigation, upon the aforementioned opinion of
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇ as to all matters governed by the laws of the State of
Indiana.
This opinion is rendered solely to you in connection with the above matter.
This opinion may not be relied upon by you for any other purpose or relied upon
by or furnished to any other person without our prior written consent.
Very truly yours,
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