REGISTERED SEARS ROEBUCK ACCEPTANCE CORP. REGISTERED
No. FLR- MEDIUM-TERM NOTE SERIES I CUSIP
(FLOATING RATE)
Except as otherwise provided in Section 2.10 of the
Indenture, this Note may be transferred, in whole but not in
part, only to another nominee of the Depository or to a
successor Depository or to a nominee of such successor
Depository.
Unless this Note is presented by an authorized
representative of The Depository Trust Company (55 Water
Street, New York, New York) to the Company or its agent for
registration of transfer, exchange or payment, and any Note
issued upon registration of transfer of, or in exchange for,
or in lieu of, this Note is registered in the name of Cede &
Co. or such other name as requested by an authorized
representative of The Depository Trust Company and any
payment hereon is made to Cede & Co. ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL since the registered owner herof, Cede & Co.,
has an interest herein.
ORIGINAL ISSUE DATE: MATURITY DATE:
INITIAL INTEREST RATE: MAXIMUM RATE:
INDEX MATURITY: MINIMUM RATE:
SPREAD (plus or minus): CALCULATION AGENT:
SPREAD MULTIPLIER: REDEMPTION COMMENCEMENT DATE:
INTEREST RATE BASIS: DESIGNATED CMT MATURITY INDEX:
INTEREST PAYMENT DATES: DESIGNATED CMT TELERATE PAGE:
INTEREST RESET DATES:
REDEMPTION PRICE: IF A REDEMPTION COMMENCEMENT DATE IS
SPECIFIED ABOVE, THE REDEMPTION PRICE SHALL BE % OF THE
PRINCIPAL AMOUNT OF THIS NOTE TO BE REDEEMED AND THE
REDEMPTION PRICE SHALL DECLINE AT EACH ANNIVERSARY OF THE
REDEMPTION COMMENCEMENT DATE BY % OF THE PRINCIPAL AMOUNT
OF THIS NOTE TO BE REDEEMED UNTIL THE REDEMPTION PRICE IS %
OF SUCH PRINCIPAL AMOUNT.
OTHER PROVISIONS:
Sears Roebuck Acceptance Corp., a corporation duly
organized and existing under the laws of the State of New
York (herein referred to as the "Company", which term
includes any successor corporation under the indenture
hereinafter referred to), for value received, hereby
promises to pay to
or registered assigns, upon presentation and surrender of
this Note on the Maturity Date shown above (except to the
extent redeemed prior to the Maturity Date) at the office or
agency of the Company in the Borough of Manhattan of The
City of New York, or, at the option of the Holder, such
office or agency, if any, maintained by the Company in the
city in which the principal executive offices of the Company
are located or the city in which the principal corporate
trust office of the Trustee is located, the principal sum of
____________________________ ____________________________
Principal Amount Specified Currency
and to pay interest thereon at the rate per annum equal to
the Initial Interest Rate shown above until the first
Interest Reset Date shown above and thereafter at the rate
determined in accordance with the provisions on the reverse
hereof depending on the Interest Rate Basis shown above.
This Note will bear interest from the Original Issue
Date specified above or from the most recent Interest
Payment Date to which interest on this Note has been paid or
duly provided for.
Interest on this Note shall be payable on the Interest
Payment Dates and on the Maturity Date indicated above (or
the date of redemption), except that if this Note was
originally issued between a Regular Record Date and an
Interest Payment Date, the first payment of interest will be
made on the Interest Payment Date following the next
succeeding Regular Record Date to the registered Holder on
such next succeeding Regular Record Date. If any Interest
Payment Date would fall on a day that is not a Business Day,
such Interest Payment Date shall be the next succeeding
Business Day (or, if the Interest Rate Basis on this Note is
LIBOR, if such day falls in the next calendar month, the
next preceding Business Day). If the Maturity Date of this
Note falls on a day that is not a Business Day, the payment
of interest and principal may be made on the next succeeding
Business Day with the same force and effect as if made at
maturity, and no interest on such payment shall accrue for
the period from and after the Maturity Date.
The Regular Record Date shall be the date 15 calendar
days prior to each Interest Payment Date, whether or not
such date shall be a Business Day.
"Business Day" as used herein means each Monday,
Tuesday, Wednesday, Thursday, and Friday which is (a) not a
legal holiday for banking institutions in any of the City of
Wilmington, Delaware, the City of Chicago, The City of New
York or the city in which the principal corporate trust
office of the Trustee is located, and (b) if this Note is
denominated in a currency other than Dollars, any such day
that is not a legal holiday for banking institutions in
,
Principal Financial Center of Country Issuing Currency
and (c) if the Interest Rate Basis with respect to this Note
is LIBOR, any such day specified in (a) on which dealings in
deposits in U.S. dollars are transacted in the London
interbank market.
The principal of (and premium, if any), and interest
on, this Note is payable by the Company in the Specified
Currency. Interest payable on any Interest Payment Date
(other than Defaulted Interest) shall be payable to the
person who is the registered Holder at the close of business
on the immediately preceding Regular Record Date. Interest
payable upon redemption or at maturity (other than a
redemption or maturity occurring on an Interest Payment
Date) will be paid to the same person to whom the principal
amount of this Note is payable.
Payment of principal of (and premium, if any), and
interest on, this Note (if the Holder of this Note is a
Depository as defined in the Indenture referred to on the
reverse hereof or a nominee of such a Depository) will be
made in accordance with any applicable provisions of such
written agreement between the Company, the Trustee and such
Depository (or its nominee) as may be in effect from time to
time or (if the Holder of this Note holds an aggregate
principal amount of $10,000,000 or more of Notes with
respect to which such payment of principal (and premium, if
any) or interest, as applicable, is to be made on such day)
will be made by wire transfer if the Holder shall have
designated in writing to the Trustee an account with a bank
located in the country issuing the Specified Currency or
such other country as shall be satisfactory to the Company
and the Trustee. If payment of interest is to be made by
wire transfer, such information must be received by the
Trustee at its corporate trust office in the Borough of
Manhattan of The City of New York on or prior to the Regular
Record Date for an Interest Payment Date. The Trustee will,
subject to applicable laws and regulations and until it
receives notice to the contrary, make such payment to such
Holder by wire transfer to the designated account. If a
payment of interest is not made in accordance with such a
written agreement or by wire transfer, payment will be made
by check. Checks for payment of interest on an Interest
Payment Date will be mailed to the Holder at the address of
such Holder appearing on the Security Register on the
applicable Regular Record Date.
To receive payment of a U.S. dollar denominated Note
upon redemption or at maturity, a Holder must make
presentation and surrender of such Note on or before the
Redemption Date or Maturity Date, as applicable. Payment
(other than payment in accordance with a written agreement
between the Company, the Trustee and a Depository (or its
nominee) as set forth above) will be made by check unless
proper wire instructions are on file with the Trustee or are
received at presentment. To receive payment of a Note
denominated in a Foreign Currency upon redemption or at
maturity, a Holder must make presentation and surrender not
less than two Business Days prior to the Redemption Date or
Maturity Date, as applicable. Upon presentation and
surrender of a Note denominated in a Foreign Currency at any
time after the date two Business Days prior to the
Redemption Date or Maturity Date, as applicable, the Company
will pay the principal amount (and premium, if any) of such
Note, and any interest due upon redemption or at maturity
(unless the Redemption Date or Maturity Date is an Interest
Payment Date), two Business Days after such presentation and
surrender.
The Company will pay any administrative costs imposed
by banks in connection with sending payments by wire
transfer, but any tax, assessment or governmental charge
imposed upon payments will be borne by the Holders of the
Notes in respect of which payments are made.
Reference is hereby made to the further provisions of
this Note set forth on the reverse hereof, and such further
provisions shall for all proposes have the same effect as
though fully set forth at this place.
This Note shall not be entitled to any benefit under
the Indenture referred to on the reverse hereof, or become
valid or obligatory for any purpose, until the certificate
of authentication hereon shall have been signed by or on
behalf of the Trustee under such Indenture.
IN WITNESS WHEREOF, the Company has caused this
instrument to be duly executed under its corporate seal.
Dated: SEARS ROEBUCK ACCEPTANCE CORP.
CERTIFICATE OF AUTHENTICATION
This is one of the Notes
designated and referred to in By
the within-mentioned Indenture. President
THE CHASE MANHATTAN BANK, N.A.,
as Trustee By
By
Authorized Signatory Vice President,
Finance and
Assistant Secretary
SEARS ROEBUCK ACCEPTANCE CORP.
Medium-Term Note Series I
This Note is one of a duly authorized issue of
debentures, notes, bonds or other evidences of indebtedness
of the Company (hereinafter called the "Securities") of the
series hereinafter specified, unlimited in aggregate
principal amount, all issued or to be issued under or
pursuant to an indenture dated as of May 15, 1995, executed
between the Company and THE CHASE MANHATTAN BANK, N.A., as
Trustee; to which indenture and all indentures supplemental
thereto (herein collectively called the "Indenture")
reference is hereby made for a specification of the rights
and limitation of rights thereunder of the Holders of the
Securities, the rights and obligations thereunder of the
Company and the rights, duties and immunities thereunder of
the Trustee. The Securities may be issued in one or more
series, which different series may be issued in various
aggregate principal amounts, may mature at different times,
may bear interest (if any) at different rates, may be
subject to different redemption provisions (if any), may be
subject to different covenants and defaults and may
otherwise vary as in the Indenture provided. This Note is
one of a series designated as the "Medium-Term Notes Series
I" (hereinafter referred to as the "Notes") of the Company,
unlimited in aggregate principal amount. All terms used in
this Note which are defined in the Indenture and which are
not otherwise defined in this Note shall have the meanings
assigned to them in the Indenture.
This Note will bear interest at a rate per annum equal
to the Initial Interest Rate shown on the face hereof until
the first Interest Reset Date shown on the face hereof and
thereafter at the rate determined in accordance with the
applicable provisions below by reference to the Interest
Rate Basis shown on the face hereof based on the Index
Maturity, if any, shown on the face hereof (i) plus or minus
the Spread, if any, specified on the face hereof, or (ii)
multiplied by the Spread Multiplier, if any, specified on
the face hereof. The rate of interest on this Note shall be
reset on each Interest Reset Date; provided, however, that
the Initial Interest Rate shall be in effect from the
Original Issue Date to the first Interest Reset Date. If
any Interest Reset Date would be a day that is not a Market
Day, the Interest Reset Date shall be postponed to the next
day that is a Market Day, except that if the Interest Rate
Basis on this Note is LIBOR and if such Market Day is in the
next succeeding calendar month, such Interest Reset Date
shall be the immediately preceding Market Day. The term
"Market Day" means any day that is not a legal holiday for
banking institutions in The City of New York, except that if
the Interest Rate Basis on this Note is LIBOR, "Market Day"
shall mean any such day on which dealings in deposits in
U.S. dollars are transacted in the London interbank market.
The "Interest Determination Date" pertaining to an
Interest Reset Date, if the Interest Rate Basis for this
Note is the Commercial Paper Rate, Prime Rate, LIBOR, CD
Rate or Federal Funds Rate, shall be the second Market Day
preceding such Interest Reset Date. The "Interest
Determination Date" pertaining to an Interest Reset Date, if
the Interest Rate Basis for this Note is the Treasury Rate,
shall be the day of the week in which such Interest Reset
Date falls on which Treasury bills would normally be
auctioned. Treasury bills are usually sold at auction on
the Monday of each week, unless that day is a legal holiday,
in which case the auction is usually held on the following
Tuesday, except that such auction may be held on the
preceding Friday. If the Interest Rate Basis on this Note
is the Treasury Rate and, as the result of a legal holiday,
an auction is so held on the preceding Friday, such Friday
shall be the Interest Determination Date pertaining to the
Interest Reset Date occurring in the next succeeding week.
If an auction date shall fall on any Interest Reset Date,
then, if the Interest Rate Basis on this Note is the
Treasury Rate, such Interest Reset Date shall instead be the
first Market Day immediately following such auction date.
The "Calculation Date" pertaining to an Interest
Determination Date shall be the earlier of (i) the tenth day
after each Interest Determination Date or, if such day is
not a Business Day, the next succeeding Business Day or (ii)
the Business Day immediately preceding the applicable
Interest Payment Date or the date of maturity, redemption or
repayment.
Determination of Commercial Paper Rate. If the
Interest Rate Basis on this Note is the Commercial Paper
Rate, the Commercial Paper Rate with respect to this Note
for each Interest Reset Date shall equal the Money Market
Yield (calculated as described below) of the per annum rate
(quoted on a bank discount basis) for the relevant Interest
Determination Date for commercial paper having the Index
Maturity specified on the face hereof as such rate is
published by the Board of Governors of the Federal Reserve
System in "Statistical Release H.15(519) Selected Interest
Rates" or any successor publication of the Board of
Governors of the Federal Reserve System ("H.15(519)") under
the heading "Commercial Paper". In the event that such rate
is not published prior to 9:00 A.M., New York City time, on
the relevant Calculation Date, then the Commercial Paper
Rate with respect to such Interest Reset Date shall be the
Money Market Yield of such rate on such Interest
Determination Date for commercial paper having the Index
Maturity specified on the face hereof as published by the
Federal Reserve Bank of New York in its daily statistical
release, "Composite 3:30 P.M. Quotations for U.S. Government
Securities" or any successor publication published by the
Federal Reserve Bank of New York ("Composite Quotations")
under the heading "Commercial Paper". If by 3:00 P.M., New
York City time, on such Calculation Date such rate is not
yet published in either H.15(519) or Composite Quotations,
the Commercial Paper Rate with respect to such Interest
Reset Date shall be calculated by the Calculation Agent and
shall be the Money Market Yield of the arithmetic mean of
the offered per annum rates (quoted on a bank discount
basis), as of 11:00 A.M., New York City time, on such
Interest Determination Date, of three leading dealers of
commercial paper in The City of New York selected by the
Calculation Agent for commercial paper of the Index Maturity
specified on the face hereof placed for an industrial issuer
whose bond rating is "AA", or the equivalent, from a
nationally recognized statistical rating agency; provided,
however, that if fewer than three dealers selected as
aforesaid by the Calculation Agent are quoting as mentioned
in this sentence, the Commercial Paper Rate with respect to
such Interest Reset Date shall be the Commercial Paper Rate
in effect on such Interest Determination Date.
"Money Market Yield" means the rate for which is quoted
on a bank discount basis, a yield (expressed as a
percentage) calculated in accordance with the following
formula:
Money Market Yield = D X 360 X 100
360 - (D X M)
where "D" refers to the per annum rate for a security,
quoted on a bank discount basis and expressed as a decimal;
and "M" refers to the number of days in the period for which
accrued interest is being calculated.
Determination of Prime Rate. If the Interest Rate
Basis on this Note is the Prime Rate, the Prime Rate with
respect to this Note for each Interest Reset Date shall
equal the rate set forth for the relevant Interest
Determination Date in H.15(519) under the heading "Bank
Prime Loan". In the event that such rate is not published
prior to 9:00 A.M., New York City time, on the relevant
Calculation Date, then the Prime Rate with respect to such
Interest Reset Date shall be the arithmetic mean of the
rates of interest publicly announced by each bank that
appears on the display designated as page "NYMF" on the
Reuter Monitor Money Rates Service (or such other page as
may replace the NYMF page on that service for the purpose of
displaying prime rates or base lending rates of major United
States banks) ("Reuters Screen NYMF Page") as such bank's
prime rate or base lending rate as in effect for such
Interest Determination Date as quoted on the Reuters Screen
NYMF Page on such Interest Determination Date. If fewer
than four such rates appear on the Reuters Screen NYMF Page
on such Interest Determination Date, the Prime Rate with
respect to such Interest Reset Date shall be the arithmetic
mean of the prime rates or base lending rates (quoted on the
basis of the actual number of days in the year divided by a
360-day year) as of the close of business on such Interest
Determination Date by three major banks in The City of New
York selected by the Calculation Agent; provided, however,
that if fewer than three banks selected as aforesaid by the
Calculation Agent are quoting as mentioned in this sentence,
the Prime Rate with respect to such Interest Reset Date will
be the Prime Rate in effect on such Interest Determination
Date.
Determination of LIBOR. If the Interest Rate Basis on this
Note is LIBOR, LIBOR with respect to this Note for each
Interest Reset Date shall be determined in accordance with
the following provisions:
(i) On the relevant Interest Determination Date, LIBOR
will be the rate for deposits in U.S. dollars having the
Index Maturity specified on the face hereof, commencing on
the second Market Day immediately following such Interest
Determination Date that appears on the display designated as
page "3750" on the Dow Jones Telerate Service (or such other
page as may replace page 3750 on that service for the
purposes of displaying London interbank offered rates of
major banks) ("Telerate Page 3750") as of 11:00 A.M., London
time, on such Interest Determination Date. If such rate
does not appear on Telerate Page 3750, LIBOR with respect to
such Interest Reset Date shall be determined as described in
(ii) below.
(ii) With respect to an Interest Determination Date on
which no such rate appears on Telerate Page 3750 as
described in (i) above, LIBOR shall be determined on the
basis of the rates at approximately 11:00 A.M., London time,
on such Interest Determination Date at which deposits in
U.S. dollars having the Index Maturity specified on the face
hereof are offered to prime banks in the London interbank
market by four major banks in the London interbank market
selected by the Calculation Agent commencing on the second
Market Day immediately following such Interest Determination
Date and in a principal amount equal to an amount of not
less than U.S. $1,000,000 that in the Calculation Agent's
judgment is representative for a single transaction in such
market at such time (a "Representative Amount"). The
Calculation Agent shall request the principal London office
of each of such banks to provide a quotation of its rate.
If at least two such quotations are provided, LIBOR with
respect to such Interest Reset Date shall be the arithmetic
mean of such quotations. If fewer than two quotations are
provided, LIBOR with respect to such Interest Reset Date
shall be the arithmetic mean of the rates quoted at
approximately 11:00 A.M., New York City time, on such
Interest Determination Date by three major banks in The City
of New York, selected by the Calculation Agent, for loans in
U.S. dollars to leading European banks having the Index
Maturity specified on the face hereof commencing on the
Interest Reset Date and in a Representative Amount;
provided, however, that if fewer than three banks selected
as aforesaid by the Calculation Agent are quoting as
mentioned in this sentence, LIBOR with respect to such
Interest Reset Date shall be the LIBOR in effect on such
Interest Determination Date.
Determination of Treasury Rate. If the Interest Rate
Basis on this Note is the Treasury Rate, the Treasury Rate
with respect to this Note for each Interest Reset Date shall
equal the rate for the auction on the relevant Interest
Determination Date of direct obligations of the United
States ("Treasury bills") having the Index Maturity
specified on the face hereof as published in H.15(519) under
the heading "U.S. Government Securities/Treasury
Bills/Auction Average (Investment)" or, if not so published
by 9:00 A.M., New York City time, on the relevant
Calculation Date, the auction average rate (expressed as a
bond equivalent, on the basis of a year of 365 or 366 days,
as applicable, and applied on a daily basis) for such
auction as otherwise announced by the United States
Department of the Treasury. In the event that the results
of such auction of Treasury bills having the Index Maturity
specified on the face hereof are not published or reported
as provided above by 3:00 P.M., New York City time, on such
Calculation Date, or if no such auction is held during such
week, then the Treasury Rate shall be the rate set forth in
H.15(519) for the relevant Interest Determination Date for
the Index Maturity specified on the face hereof under the
heading "U.S. Government Securities/Treasury Bills/Secondary
Market". In the event such rate is not so published by 3:00
P.M., New York City time, on the relevant Calculation Date,
the Treasury Rate with respect to such Interest Reset Date
shall be calculated by the Calculation Agent and shall be a
yield to maturity (expressed as a bond equivalent, on the
basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) of the arithmetic mean of the
secondary market bid rates as of approximately 3:30 P.M.,
New York City time, on such Interest Determination Date, of
three primary United States government securities dealers in
The City of New York selected by the Calculation Agent for
the issue of Treasury bills with a remaining maturity
closest to the Index Maturity specified on the face hereof;
provided, however, that if fewer than three dealers selected
as aforesaid by the Calculation Agent are quoting as
mentioned in this sentence, the Treasury Rate with respect
to such Interest Reset Date shall be the Treasury Rate in
effect on such Interest Determination Date.
Determination of CD Rate. If the Interest Rate Basis
on this Note is the CD Rate, the CD Rate with respect to
this Note for each Interest Reset Date shall equal the rate
for the relevant Interest Determination Date for negotiable
certificates of deposit having the Index Maturity specified
on the face hereof as published in H.15(519) under the
heading "CDs (Secondary Market)". In the event that such
rate is not published prior to 9:00 A.M., New York City
time, on the relevant Calculation Date, then the CD Rate
with respect to such Interest Reset Date shall be the rate
on such Interest Determination Date for negotiable
certificates of deposit having the Index Maturity specified
on the face hereof as published in Composite Quotations
under the heading "Certificates of Deposit". If by 3:00
P.M., New York City time, on such Calculation Date such rate
is not published in either H.15(519) or Composite
Quotations, the CD Rate with respect to such Interest Reset
Date shall be calculated by the Calculation Agent and shall
be the arithmetic mean of the secondary market offered
rates, as of 10:00 A.M., New York City time, on such
Interest Determination Date, of three leading nonbank
dealers of negotiable U.S. dollar certificates of deposit in
The City of New York selected by the Calculation Agent for
negotiable certificates of deposit of major United States
money market banks with a remaining maturity closest to the
Index Maturity specified on the face hereof in a
denomination of U.S. $5,000,000; provided, however, that if
fewer than three dealers selected as aforesaid by the
Calculation Agent are quoting as mentioned in this sentence,
the CD Rate with respect to such Interest Reset Date shall
be the CD Rate in effect on such Interest Determination
Date.
Determination of Federal Funds Rate. If the Interest
Rate Basis on this Note is the Federal Funds Rate, the
Federal Funds Rate with respect to this Note for each
Interest Reset Date shall equal the rate on the relevant
Interest Determination Date for Federal Funds as published
in H.15(519) under the heading "Federal Funds (Effective)".
In the event that such rate is not published prior to 9:00
A.M., New York City time, on the relevant Calculation Date,
then the Federal Funds Rate with respect to such Interest
Reset Date will be the rate on such Interest Determination
Date as published in Composite Quotations under the heading
"Federal Funds/Effective Rate". If by 3:00 P.M., New York
City time, on such Calculation Date such rate is not
published in either H.15(519) or Composite Quotations, the
Federal Funds Rate with respect to such Interest Reset Date
shall be calculated by the Calculation Agent and shall be
the arithmetic mean of the rates, as of 9:00 A.M., New York
City time, on such Interest Determination Date, for the last
transaction in overnight Federal Funds arranged by three
leading brokers of Federal Funds transactions in The City of
New York selected by the Calculation Agent; provided,
however, that if fewer than three brokers selected as
aforesaid by the Calculation Agent are quoting as mentioned
in this sentence, the Federal Funds Rate with respect to
such Interest Reset Date shall be the Federal Funds Rate in
effect on such Interest Determination Date.
Determination of CMT Rate. If the Interest Rate Basis
on this Note is the CMT Rate, the CMT Rate with respect to
this Note for each Interest Reset Date shall equal the rate
displayed on the Designated CMT Telerate Page under the
caption "...Treasury Constant Maturities...Federal Reserve
Board Release H.15...Mondays Approximately 3:45 P.M.," under
the column for the Designated CMT Maturity Index for (i) if
the Designated CMT Telerate Page is 7055, the rate on such
Interest Determination Date and (ii) if the Designated CMT
Telerate Page is 7052, the week, or the month, as
applicable, ended immediately preceding the week in which
the related Interest Determination Date occurs. If such
rate is no longer displayed on the relevant page, or if not
displayed by 3:00 P.M., New York City time, on the relevant
Calculation Date, the CMT Rate shall be such treasury
constant maturity rate for the Designated CMT Maturity Index
as published in the relevant H.15(519). If such rate is no
longer published, or if not published by 3:00 P.M., New York
City time, on the relevant Calculation Date, the CMT Rate
shall be such treasury constant maturity rate for the
Designated CMT Maturity Index (or other United States
Treasury rate for the Designated CMT Maturity Index) for the
Interest Determination Date with respect to such Interest
Reset Date as may then be published by either the Board of
Governors of the Federal Reserve System or the United States
Department of the Treasury that the Calculation Agent
determines to be comparable to the rate formerly displayed
on the Designated CMT Telerate Page and published in the
relevant H.15(519). If such information is not published by
3:00 P.M., New York City time, on the relevant Calculation
Date, the CMT Rate shall be calculated by the Calculation
Agent and will be a yield to maturity, based on the
arithmetic mean of the secondary market closing offer side
prices as of approximately 3:30 P.M., New York City time, on
the Interest Determination Date reported, according to their
written records, by three leading primary United States
government securities dealers (each, a "Reference Dealer")
in The City of New York selected by the Calculation Agent
(from five such Reference Dealers selected by the
Calculation Agent and eliminating the highest quotation (or,
in the event of equality, one of the highest) and the lowest
quotation (or, in the event of equality, one of the
lowest)), for the most recently issued direct noncallable
fixed rate obligations of the United States ("Treasury
Notes") with an original maturity of approximately the
Designated CMT Maturity Index and a remaining term to
maturity of not less than such Designated CMT Maturity Index
minus one year. If three or four (and not five) of such
Reference Dealers are quoting, than the CMT Rate shall be
based on the arithmetic mean of the offer prices obtained
and neither the highest nor the lowest of such quotes will
be eliminated. If the Calculation Agent cannot obtain three
such Treasury Note quotations, the CMT Rate shall be
calculated by the Calculation Agent and will be a yield to
maturity based on the arithmetic mean of the secondary
market offer side prices as of approximately 3:30 P.M., New
York City time, on the Interest Determination Date of three
Reference Dealers in The City of New York (from five such
Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation (or, in the event of
equality, one of the highest) and the lowest quotation (or,
in the event of equality, one of the lowest)), for Treasury
Notes with an original maturity closest to the Designated
CMT Maturity Index and in an amount of at least $100
million. If three or four (and not five) of such Reference
Dealers are quoting, than the CMT Rate shall be based on the
arithmetic mean of the offer prices obtained and neither the
highest nor the lowest of such quotes will be eliminated;
provided, however, that if fewer than three Reference
Dealers selected by the Calculation Agent are quoting, the
CMT Rate shall be the CMT Rate in effect on such CMT
Interest Determination Date. If two Treasury Notes with an
original maturity as described in the second preceding
sentence have remaining terms to maturity equally close to
the Designated CMT Maturity Index, the quotes for the
Treasury Note with the shorter remaining term to maturity
will be used.
Notwithstanding the foregoing, the interest rate on
this Note shall not be greater than the Maximum Interest
Rate, if any, or less than the Minimum Interest Rate, if
any, shown on the face hereof.
At the request of the Holder hereof, the Calculation
Agent will provide to the Holder hereof the interest rate
then in effect and, if determined, the interest rate which
will become effective as of the next Interest Reset Date.
The Calculation Agent shall calculate the interest rate
hereon in accordance with the provisions hereof on or before
each Calculation Date. The Calculation Agent's
determination of any interest rate will be final and binding
in the absence of manifest error.
Unless otherwise specified on the face of this Note,
accrued interest on this Note from the date of issue or from
the last date to which interest has been paid shall be
calculated by multiplying the face amount hereof by an
accrued interest factor. Unless otherwise specified on the
face of this Note, such accrued interest factor is computed
by adding the interest factor calculated for each day from
the date of issue, or from the last date to which interest
has been paid, to but excluding the date for which accrued
interest is being calculated. Unless otherwise specified on
the face of this Note, the interest factor (expressed as a
decimal, rounded if necessary to the next higher one hundred
thousandth of a percentage point for each such day) shall be
computed by dividing the interest rate (expressed as a
decimal) applicable to such date by 360 if the Interest Rate
Basis with respect to this Note is the Commercial Paper
Rate, Prime Rate, LIBOR, CD Rate or Federal Funds Rate, or
by the actual number of days in the year, if the Interest
Rate Basis with respect to this Note is the Treasury Rate or
the CMT Rate. The applicable interest rate on any Interest
Reset Date will be the interest rate as reset on such date.
The applicable interest rate on any other day will be the
interest rate from the immediately preceding Interest Reset
Date (or, if none, the Initial Interest Rate).
Payments of interest on this Note with respect to any
Interest Payment Date or Maturity Date (or date of
redemption) will include interest accrued to but excluding
such Interest Payment Date or Maturity Date (or date of
redemption); provided, however, that if the Interest Reset
Dates with respect hereto are daily or weekly, interest
payable hereon on any Interest Payment Date, other than
interest payable on the date on which principal hereon is
payable, will include interest accrued to but excluding the
day following the next preceding Regular Record Date.
The Notes are issuable only in registered form without
coupons and will be either (a) Book-Entry Notes represented
by one or more global notes (each a "Global Note") recorded
in the book-entry system maintained by the Depository or (b)
certificated notes issued to, and registered in the names
of, the beneficial owners or their nominees ("Certificated
Notes"). Notes are issuable in minimum denominations of (i)
in the case of Notes denominated in Dollars, U.S. $1,000 and
in any larger amount in integral multiples of $1,000, and
(ii) in the case of Notes denominated in any Foreign
Currency, the equivalent in such Foreign Currency determined
in accordance with the Market Exchange Rate for such Foreign
Currency on the Business Day immediately preceding the date
on which the Company accepts an offer to purchase a Note, of
U.S. $1,000 (rounded to an integral multiple of 1,000 units
of the Foreign Currency), and in any larger amount. In the
manner and subject to the limitations provided in the
Indenture, the Global Notes or Certificated Notes are
exchangeable, without charge except for any tax or other
governmental charge imposed in relation thereto, for other
Notes of authorized denominations for a like aggregate
principal amount, at the office or agency of the Company in
the Borough of Manhattan of The City of New York, or, at the
option of the Holders thereof, such office or agency, if
any, maintained by the Company in the city in which the
principal executive offices of the Company are located or
the city in which the principal corporate trust office of
the Trustee is located.
Unless this Note is denominated in Dollars, in the
event that the currency in which this Note is denominated is
not available for payment at a time at which any payment is
required hereunder due to the imposition of exchange
controls or other circumstances beyond its control, the
Company may, in full satisfaction of its obligation to make
such payment, make instead a payment in an equivalent amount
of Dollars, determined in accordance with the Market
Exchange Rate for such currency on the latest date for which
such rate was established on or before the date on which
payment is due, and such substituted payment of Dollars
shall not constitute a default under this Note or the
Indenture.
If a Redemption Commencement Date is specified above,
this Note may be redeemed, whether or not any other Note is
concurrently redeemed, at the option of the Company, as a
whole, or from time to time in part, on any Business Day on
or after the Redemption Commencement Date and prior to the
Maturity Date, upon mailing by first-class mail, postage
prepaid, a notice of such redemption not less than 30 nor
more than 60 days prior to the Redemption Date, to the
Holder of this Note at his address appearing in the Security
Register, as provided in the Indenture (provided that, if
the Holder of this Note is a Depository or a nominee of a
Depository, notice of such redemption shall be given in
accordance with any applicable provisions of such written
agreement between the Company, the Trustee and such
Depository (or its nominee) as may be in effect from time to
time), at the Redemption Price specified on the face of this
Note (expressed in percentages of the principal amount
hereof to be redeemed) together in each case with interest
accrued to the Redemption Date (subject to the right of the
Holder of record on a Regular Record Date to receive
interest due on an Interest Payment Date). In the event of
redemption of this Note in part only, a new Note or Notes of
this series, and of like tenor, for the unredeemed portion
hereof will be issued in the name of the Holder hereof upon
the cancellation hereof.
In case a default, as defined in the Indenture, shall
occur and be continuing with respect to the Notes, the
principal amount of all Notes then outstanding under the
Indenture may be declared or may become due and payable upon
the conditions and in the manner and with the effect
provided in the Indenture. The Indenture provides that such
declaration may in certain events be annulled by the Holders
of a majority in principal amount of the Notes outstanding.
To the extent permitted by, and as provided in, the
Indenture, modifications or alterations of the Indenture, or
of any indenture supplemental thereto, and of the rights and
obligations of the Company and the Holders of the Notes, may
be made with the consent of the Company by the affirmative
vote or consent of the Holders of not less than a majority
in principal amount of the Securities then outstanding (as
defined in the Indenture) of each series to be affected,
evidenced as in the Indenture provided; provided, however,
that no such modification or alteration shall (i) change the
stated maturity of the principal of (and premium, if any),
or the interest on, any Security, or reduce the principal
amount of (and premium, if any), or the rate of interest on,
any Security, or change the Currency in which the principal
of (and premium, if any), or interest on, such Security is
denominated or payable, or reduce the amount of the
principal of an Original Issue Discount Security that would
be payable upon a declaration of acceleration of the
Maturity thereof pursuant to Section 6.1 of the Indenture
without the consent of the Holder of each outstanding
Security so affected, or (ii) reduce the percentage of
Securities, the vote or consent of the Holders of which is
required for such modifications and alterations, without the
consent of the Holders of all Securities affected. The
Indenture also provides that the Holders of a majority in
principal amount of the Securities of any series then
outstanding may waive any past default with respect to
Securities of such series under the Indenture and its
consequences, except a default in the payment of the
principal of (or premium, if any), or interest on, any of
the Securities.
This Note is transferable by the registered Holder
hereof or by his attorney duly authorized in writing at the
office or agency of the Company in the Borough of Manhattan
of The City of New York, or, at the option of the Holder
hereof, such office or agency, if any, maintained by the
Company in the city in which the principal executive offices
of the Company are located or the city in which the
principal corporate trust office of the Trustee is located,
without charge except for any tax, assessment or other
governmental charge imposed in relation thereto, but only in
the manner and subject to the limitations provided in the
Indenture and upon surrender of this Note. Upon any such
transfer a Note or Notes of authorized denominations for a
like aggregate principal amount and bearing a number not
contemporaneously outstanding will be issued in exchange
herefor.
The Company, the Trustee, any Authenticating Agent, any
paying agent and any Security registrar may deem and treat
the registered Holder hereof as the absolute owner hereof
(whether or not this Note shall be overdue and
notwithstanding any notation of ownership or other writing
hereon by anyone other than the Company or any Security
registrar) for the purpose of receiving payment of or on
account of the principal hereof (and premium, if any), and
interest hereon, and for all other purposes, and neither the
Company, the Trustee, an Authenticating Agent, a paying
agent nor the Security registrar shall be affected by any
notice to the contrary. All such payments shall be valid
and effectual to satisfy and discharge the liability upon
this Note to the extent of the sum or sums so paid.
No recourse shall be had for the payment of the
principal of (or premium, if any), or interest on, this Note
or for any claim based hereon or otherwise in any manner in
respect hereof, or in respect of the Indenture, against any
incorporator, shareholder, officer or director, past,
present or future, of the Company or of any predecessor or
successor corporation, whether by virtue of any
constitutional provision or statute or rule of law, or by
the enforcement of any assessment or penalty or in any other
manner, all such liability being expressly waived and
released by the acceptance hereof and as part of the
consideration for the issue hereof. In the event of any
sale or transfer of its assets and liabilities substantially
as an entirety to a successor corporation, the predecessor
corporation may be dissolved and liquidated as more fully
set forth in the Indenture.
All Dollar amounts used in or resulting from
calculations referred to in this Note shall be rounded to
the nearest cent (with one half cent being rounded upwards).
This Note shall be governed by, and construed in
accordance with, the internal laws of the State of Illinois.
ASSIGNMENT FORM
To assign this Note, fill in the form below:
I or we assign and transfer this Note to
_______________________________________
(Insert assignee's soc. sec. or tax I.D. no.)
____________________________________________________________
(Print or type assignee's name, address and zip code)
____________________________________________________________
____________________________________________________________
____________________________________________________________
and irrevocably appoint ____________________________________
agent to transfer this Note on the books of the Company.
The agent may substitute another to act for him.
____________________________________________________________
Date _______________ Your signature_________________________
____________________________________________________________
(Sign exactly as your name appears on the other side of
this Note. The signature to this assignment must be
guaranteed by a commercial bank or trust company having its
principal office or a correspondent in The City of New York
or by a member of The New York Stock Exchange.)