Exhibit 1.1
FIRSTAR CORPORATION
MEDIUM-TERM NOTES
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
DISTRIBUTION AGREEMENT
July 20, 1999
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Banc of America Securities LLC
Bear, Stearns & Co. Inc.
Donaldson, Lufkin & Jenrette Securities Corporation
Credit Suisse First Boston Corporation
Goldman, Sachs & Co.
Lehman Brothers Inc.
Morgan Stanley & Co. Incorporated
Salomon Smith Barney Inc.
Ladies and Gentlemen:
Firstar Corporation, a Wisconsin corporation (the "Company"), confirms its
agreement with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Banc of America Securities, Inc., Bear, Stearns & Co. Inc.,
Donaldson, Lufkin & Jenrette Securities Corporation, Credit Suisse First Boston
Corporation, Goldman, Sachs & Co., Lehman Brothers Inc., Morgan Stanley & Co.
Incorporated and Salomon Smith Barney Inc. (each, an "Agent", and collectively,
the "Agents") with respect to the issue and sale by the Company of its
Medium-Term Notes Due Nine Months or More From Date of Issue (the "Notes"). The
Notes are to be issued pursuant to an Indenture, dated as of June 22, 1999, as
amended or modified from time to time (the "Indenture"), between the Company and
Citibank N.A., as trustee (the "Trustee"). As of the date hereof, the Company
has authorized the issuance and sale of up to U.S. $500,000,000 aggregate
initial offering price of Notes (or its equivalent, based upon the exchange rate
on the applicable trade date in such foreign or composite currencies as the
Company shall designate at the time of
2
issuance) to or through the Agents pursuant to the terms of this Agreement. It
is understood, however, that the Company may from time to time authorize the
issuance of additional Notes and that such additional Notes may be sold to or
through the Agents pursuant to the terms of this Agreement, all as though the
issuance of such Notes were authorized as of the date hereof.
This Agreement provides both for the sale of Notes by the Company to one
or more Agents as principal for resale to investors and other purchasers and for
the sale of Notes by the Company directly to investors (as may from time to time
be agreed to by the Company and the applicable Agent), in which case the
applicable Agent will act as an agent of the Company in soliciting offers for
the purchase of Notes.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-79981) and
pre-effective Amendment No. 1 thereto for the registration of common stock,
preferred stock, depositary shares, debt securities, including the Notes, and
securities warrants under the Securities Act of 1933, as amended (the "1933
Act"), and the offering thereof from time to time in accordance with Rule 415 of
the rules and regulations of the Commission under the 1933 Act (the "1933 Act
Regulations"). Such registration statement has been declared effective by the
Commission and the Indenture has been duly qualified under the Trust Indenture
Act of 1939, as amended (the "1939 Act"), and the Company has filed such
post-effective amendments thereto as may be required prior to its acceptance of
any offer for the purchase of Notes and each such post-effective amendment has
been declared effective by the Commission. Such registration statement (as so
amended, if applicable) is referred to herein as the "Registration Statement";
and the final prospectus and all applicable amendments or supplements thereto
(including the final prospectus supplement and pricing supplement relating to
the offering of Notes), in the form first furnished to the applicable Agent(s)
for use in confirming sales of Notes, are collectively referred to herein as the
"Prospectus"; provided, however, that all references to the "Registration
Statement" and the "Prospectus" shall also be deemed to include all documents
incorporated therein by reference, prior to any acceptance by the Company of an
offer for the purchase of Notes; provided, further, that if the Company files a
registration statement with the Commission pursuant to Rule 462(b) of the 1933
Act Regulations (the "Rule 462(b) Registration Statement"), then, after such
filing, all references to the "Registration Statement" shall also be deemed to
include the Rule 462(b) Registration Statement. A "preliminary prospectus" shall
be deemed to refer to any prospectus used before the Registration Statement
became effective and any prospectus furnished by the Company after the
registration statement became effective and before any acceptance by the Company
of an offer for the purchase of Notes which omitted information to be included
upon pricing in a form of prospectus filed with the Commission pursuant to Rule
424(b) of the 1933 Act Regulations. For purposes of this Agreement, all
references to the Registration Statement, Prospectus or preliminary prospectus
or to any amendment or supplement thereto shall be deemed to include any copy
filed with the Commission pursuant to its Electronic Data Gathering, Analysis
and Retrieval system ("EDGAR").
All references in this Agreement to financial statements and schedules and
other information which is "disclosed", "contained," "included" or "stated" (or
other references of like import) in the Registration Statement, Prospectus or
preliminary prospectus shall be deemed to
3
include all such financial statements and schedules and other information which
is incorporated by reference in the Registration Statement, Prospectus or
preliminary prospectus, as the case may be; and all references in this Agreement
to amendments or supplements to the Registration Statement, Prospectus or
preliminary prospectus shall be deemed to include the filing of any document
under the Securities Exchange Act of 1934, as amended (the "1934 Act") which is
incorporated by reference in the Registration Statement, Prospectus or
preliminary prospectus, as the case may be.
SECTION 1. APPOINTMENT AS AGENT.
(a) APPOINTMENT. Subject to the terms and conditions stated herein and
subject to the reservation by the Company of the right to sell Notes directly
on its own behalf, the Company hereby agrees that it will solicit the sale of
Notes exclusively to or through the Agents. The Company agrees that it will not
appoint any other agents to act on its behalf, or to assist it, in the
solicitation of the sale of the Notes.
(b) SALE OF NOTES. The Company shall not sell or approve the solicitation
of offers for the purchase of Notes in excess of the amount which shall be
authorized by the Company from time to time or in excess of the aggregate
initial offering price of Notes registered pursuant to the Registration
Statement. The Agents shall have no responsibility for maintaining records with
respect to the aggregate initial offering price of Notes sold, or of otherwise
monitoring the availability of Notes for sale, under the Registration Statement.
(c) PURCHASES AS PRINCIPAL. The Agents shall not have any obligation to
purchase Notes from the Company as principal. However, absent an agreement
between an Agent and the Company that such Agent shall be acting solely as an
agent for the Company, such Agent shall be deemed to be acting as principal in
connection with any offering of Notes by the Company through such Agent.
Accordingly, the Agents, individually or in a syndicate, may agree from time to
time to purchase Notes from the Company as principal for resale to investors and
other purchasers determined by such Agents. Any purchase of Notes from the
Company by an Agent as principal shall be made in accordance with Section 3(a)
hereof.
(d) SOLICITATIONS AS AGENT. If agreed upon between an Agent and the
Company, such Agent, acting solely as an agent for the Company and not as
principal, will solicit offers for the purchase of Notes. Such Agent will
communicate to the Company, orally, each offer for the purchase of Notes
solicited by it on an agency basis other than those offers rejected by such
Agent. Such Agent shall have the right, in its discretion reasonably exercised,
to reject any offer for the purchase of Notes, in whole or in part, and any such
rejection shall not be deemed a breach of its agreement contained herein. The
Company may accept or reject any offer for the purchase of Notes, in whole or in
part. Such Agent shall make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer for the purchase of Notes
has been solicited by it on an agency basis and accepted by the Company. Such
Agent shall not have any liability to the Company in the event that any such
purchase is not consummated for any reason. If the Company shall default on its
obligation to deliver Notes to a purchaser whose offer has been solicited by
such Agent on an agency basis and accepted by the Company, the Company shall (i)
4
hold such Agent harmless against any loss, claim or damage arising from or as a
result of such default by the Company and (ii) pay to such Agent any commission
to which it would otherwise be entitled absent such default.
(e) RELIANCE. The Company and the Agents agree that any Notes purchased
from the Company by one or more Agents as principal shall be purchased, and any
Notes the placement of which an Agent arranges as an agent of the Company shall
be placed by such Agent, in reliance on the representations, warranties,
covenants and agreements of the Company contained herein and on the terms and
conditions and in the manner provided herein.
SECTION 2. REPRESENTATIONS AND WARRANTIES.
(a) The Company represents and warrants to each Agent as of the date
hereof, as of the date of each acceptance by the Company of an offer for the
purchase of Notes (whether to such Agent as principal or through such Agent as
agent), as of the date of each delivery of Notes (whether to such Agent as
principal or through such Agent as agent) (the date of each such delivery to
such Agent as principal is referred to herein as a "Settlement Date"), and as of
any time that the Registration Statement or the Prospectus shall be amended or
supplemented (each of the times referenced above is referred to herein as a
"Representation Date"), as follows:
(i) DUE INCORPORATION, GOOD STANDING AND DUE QUALIFICATION OF THE
COMPANY. The Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Wisconsin with
corporate power and authority to own, lease and operate its properties and
to conduct its business as described in the Prospectus and to enter into
this Agreement and consummate the transactions contemplated in the
Prospectus; the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the failure to
so qualify or be in good standing would not result in a material adverse
change in the condition, financial or otherwise, or in the earnings,
business affairs or business prospects of the Company and its subsidiaries
considered as one enterprise (a "Material Adverse Effect"); all of the
issued and outstanding shares of capital stock of the Company have been
duly authorized and are validly issued, fully paid and non-assessable
(subject to Section 180.0622(2)(b) of the Wisconsin Business Corporation
Law (the "WBCL")); and none of the outstanding shares of capital stock of
the Company were issued in violation of preemptive or other similar rights
of any securityholder of the Company.
(ii) DUE INCORPORATION, GOOD STANDING AND DUE QUALIFICATION OF BANK
SUBSIDIARIES. Firstar Bank, N.A. and Firstar Bank Milwaukee, N.A. (the
"Bank Subsidiaries") are national banking associations duly organized and
validly existing under the laws of the United States, continue to hold
valid certificates to do business as such and to own, lease and operate
their properties and are duly authorized to transact business and are in
good standing in each jurisdiction in which they own or lease property of a
nature, or transact business of a type, that would make such qualification
necessary, except where
5
the failure to so qualify or be in good standing would not result in a
Material Adverse Effect; except as stated in the Prospectus, all of
the issued and outstanding shares of capital stock of each Bank
Subsidiary has been duly authorized and is validly issued, fully paid
and (except as provided in 12 U.S.C. 55, as amended) non-assessable
and is owned by the Company, directly or through subsidiaries, free
and clear of any security interest, mortgage, pledge, lien,
encumbrance, claim or equity; and none of the outstanding shares of
capital stock of any Bank Subsidiary was issued in violation of
preemptive or other similar rights of any securityholder of such Bank
Subsidiary.
(iii) REGISTRATION STATEMENT AND PROSPECTUS. The Company meets the
requirements for use of Form S-3 under the 1933 Act; the Registration
Statement (or any Rule 462(b) Registration Statement) has become effective
under the 1933 Act and no stop order suspending the effectiveness of the
Registration Statement (or any Rule 462(b) Registration Statement) has been
issued under the 1933 Act and no proceedings for that purpose have been
instituted or are pending or, to the knowledge of the Company, are
contemplated by the Commission, and any request on the part of the
Commission for additional information has been complied with; the Indenture
has been duly qualified under the 1939 Act; at the respective times that
the Registration Statement (including any Rule 462(b) Registration
Statement) and any post-effective amendment thereto became effective and at
each Representation Date, the Registration Statement (including any Rule
462(b) Registration Statement) and any amendments thereto complied and will
comply in all material respects with the requirements of the 1933 Act and
the 1933 Act Regulations and the 1939 Act and the rules and regulations of
the Commission under the 1939 Act (the "1939 Act Regulations") and did not
and will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading; each preliminary prospectus and
prospectus filed as part of the Registration Statement as originally filed
or as part of any amendment thereto, or filed pursuant to Rule 424 under
the 1933 Act, complied when so filed in all material respects with the 1933
Act Regulations; each preliminary prospectus and the Prospectus delivered
to the applicable Agent(s) for use in connection with the offering of Notes
are identical to any electronically transmitted copies thereof filed with
the Commission pursuant to EDGAR, except to the extent permitted by
Regulation S-T; and at the date hereof, at the date of the Prospectus and
each amendment or supplement thereto and at each Representation Date,
neither the Prospectus nor any amendment or supplement thereto included or
will include an untrue statement of a material fact or omitted or will 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; provided, however, that the representations and warranties in
this subsection shall not apply to (A) statements in or omissions from the
Registration Statement or the Prospectus made in reliance upon and in
conformity with information furnished to the Company in writing by the
Agents expressly for use in the Registration Statement or the Prospectus
and (B) that part of the Registration Statement which shall constitute the
Statement of Eligibility of the Trustee (Form T-1) under the Trust
Indenture Act.
6
(iv) INCORPORATED DOCUMENTS. The documents incorporated or deemed
to be incorporated by reference in the Prospectus, at the time they were or
hereafter are filed with the Commission, complied and will comply in all
material respects with the requirements of the 1934 Act and the rules and
regulations of the Commission under the 1934 Act (the "1934 Act
Regulations") and, when read together with the other information in the
Prospectus, at the date hereof, at the date of the Prospectus and at each
Representation Date, did not and will not include an 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.
(v) INDEPENDENT ACCOUNTANTS. The accountants who certified the
financial statements and any supporting schedules thereto included in the
Registration Statement and the Prospectus are independent public
accountants as required by the 1933 Act and the 1933 Act Regulations.
(vi) FINANCIAL STATEMENTS. The consolidated financial statements of
the Company included in the Registration Statement and the Prospectus,
together with the related schedules and notes, as well as those financial
statements, pro forma financial statements, schedules and notes of any
other entity included in the Registration Statement and the Prospectus,
present fairly the consolidated financial position of the Company and its
subsidiaries, or such other entity, as the case may be, at the dates
indicated and the consolidated statement of operations, stockholders'
equity and cash flows of the Company and its subsidiaries, or such other
entity, as the case may be, for the periods specified; such financial
statements have been prepared in conformity with generally accepted
accounting principles ("GAAP") applied on a consistent basis throughout the
periods involved; the supporting schedules, if any, included in the
Registration Statement and the Prospectus present fairly in accordance with
GAAP the information required to be stated therein; the selected financial
data and the summary financial information included in the Registration
Statement and the Prospectus present fairly the information shown therein
and have been compiled on a basis consistent with that of the audited
financial statements included in the Registration Statement and the
Prospectus; and any pro forma consolidated financial statements and the
related notes thereto included in the Registration Statement and the
Prospectus present fairly the information shown therein, have been prepared
in accordance with the Commission's rules and guidelines with respect to
pro forma financial statements and have been properly compiled on the bases
described therein, and the assumptions used in the preparation thereof are
reasonable and the adjustments used therein are appropriate to give effect
to the transactions and circumstances referred to therein.
(vii) NO MATERIAL CHANGES. Since the respective dates as of which
information is given in the Registration Statement and the Prospectus,
except as otherwise stated therein, (1) there has been no event or
occurrence that would result in a Material Adverse Effect and (2) there
have been no transactions entered into by the Company or any of its
subsidiaries, other than those in the ordinary course of business, which
are material with respect to the Company and its subsidiaries considered as
one enterprise.
7
(viii) AUTHORIZATION, ETC. OF THIS AGREEMENT, THE INDENTURE AND THE
NOTES. This Agreement has been duly authorized, executed and delivered by
the Company; the Indenture has been duly authorized, executed and delivered
by the Company and will be a valid and legally binding agreement of the
Company, enforceable against the Company in accordance with its terms,
except as enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement
of creditors' rights generally or by general equitable principles
(regardless of whether enforcement is considered in a proceeding in equity
or at law), and except further as enforcement thereof may be limited by
requirements that a claim with respect to any debt securities issued under
the Indenture that are payable in a foreign or composite currency (or a
foreign or composite currency judgment in respect of such claim) be
converted into U.S. dollars at a rate of exchange prevailing on a date
determined pursuant to applicable law or by governmental authority to
limit, delay or prohibit the making of payments outside the United States;
the Notes have been duly authorized by the Company for offer, sale,
issuance and delivery pursuant to this Agreement and, when issued,
authenticated and delivered in the manner provided for in the Indenture and
delivered against payment of the consideration therefor, will constitute
valid and legally binding obligations of the Company, enforceable against
the Company in accordance with their terms, except as enforcement thereof
may be limited by bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights generally
or by general equitable principles (regardless of whether enforcement is
considered in a proceeding in equity or at law), and except further as
enforcement thereof may be limited by requirements that a claim with
respect to any Notes payable in a foreign or composite currency (or a
foreign or composite currency judgment in respect of such claim) be
converted into U.S. dollars at a rate or exchange prevailing on a date
determined pursuant to applicable law or by governmental authority to
limit, delay or prohibit the making of payments outside the United States;
the Notes will be substantially in a form previously certified to the
Agents and contemplated by the Indenture; and each holder of Notes will be
entitled to the benefits of the Indenture.
(ix) DESCRIPTIONS OF THE INDENTURE AND THE NOTES. The Indenture and
the Notes conform and will conform in all material respects to the
statements relating thereto contained in the Prospectus and are
substantially in the form filed or incorporated by reference, as the case
may be, as an exhibit to the Registration Statement.
(x) ACCURACY OF EXHIBITS. There are no contracts or documents
which are required to be described in the Registration Statement, the
Prospectus or the documents incorporated by reference therein or to be
filed as exhibits thereto which have not been so described and filed as
required.
(xi) ABSENCE OF DEFAULTS AND CONFLICTS. Neither the Company nor any
of its subsidiaries is in violation of the provisions of its charter or
by-laws or in default in the performance or observance of any obligation,
agreement, covenant or condition contained in any contract, indenture,
mortgage, deed of trust, loan or credit agreement, note, lease or other
agreement or instrument to which the Company or any of its
8
subsidiaries is a party or by which it or any of them may be bound or
to which any of the property or assets of the Company or any of its
subsidiaries is subject (collectively, "Agreements and Instruments"),
except for such defaults that would not result in a Material Adverse
Effect; and the execution, delivery and performance of this Agreement, the
Indenture, the Notes and any other agreement or instrument entered into or
issued or to be entered into or issued by the Company in connection with
the transactions contemplated by the Prospectus, the consummation of the
transactions contemplated in the Prospectus (including the issuance and
sale of the Notes and the use of proceeds therefrom as described in the
Prospectus) and the compliance by the Company with its obligations
hereunder and under the Indenture, the Notes and such other agreements or
instruments have been duly authorized by all necessary corporate action and
do not and will not, whether with or without the giving of notice or the
passage of time or both, conflict with or constitute a breach of, or
default or event or condition which gives the holder of any note, debenture
or other evidence of indebtedness (or any person acting on such holder's
behalf) the right to require the repurchase, redemption or repayment of all
or a portion of such indebtedness by the Company or any of its subsidiaries
(a "Repayment Event") under, or result in the creation or imposition of any
lien, charge or encumbrance upon any assets, properties or operations of
the Company or any of its subsidiaries pursuant to, any Agreements and
Instruments, nor will such action result in any violation of the provisions
of the charter or bylaws of the Company or any of its subsidiaries or any
applicable law, statute, rule, regulation, judgment, order, writ or decree
of any government, government instrumentality or court, domestic or
foreign, having jurisdiction over the Company or any of its subsidiaries or
any of their assets, properties or operations.
(xii) ABSENCE OF PROCEEDINGS. There is no action, suit, proceeding,
inquiry or investigation before or brought by any court or governmental
agency or body, domestic or foreign, now pending, or to the knowledge of
the Company threatened, against or affecting the Company or any of its
subsidiaries which is required to be disclosed in the Registration
Statement and the Prospectus (other than as stated therein), or which may
reasonably be expected to result in a Material Adverse Effect, or which may
reasonably be expected to materially and adversely affect the assets,
properties or operations thereof, the performance by the Company of its
obligations under this Agreement, the Indenture and the Notes or the
consummation of the transactions contemplated in the Prospectus; and the
aggregate of all pending legal or governmental proceedings to which the
Company or any of its subsidiaries is a party or of which any of their
respective assets, properties or operations is the subject which are not
described in the Registration Statement and the Prospectus, including
ordinary routine litigation incidental to the business, may not reasonably
be expected to result in a Material Adverse Effect.
(xiii) NO FILINGS, REGULATORY APPROVALS ETC. No filing with, or
approval, authorization, consent, license, registration, qualification,
order or decree of, any court or governmental authority or agency, domestic
or foreign, is necessary or required for the due authorization, execution
and delivery by the Company of this Agreement, the
9
Indenture and the Notes or for the performance by the Company of the
transactions contemplated in this Agreement, the Indenture or the
Prospectus, except such as have been previously made, obtained or rendered,
as applicable.
(xiv) INVESTMENT COMPANY ACT. The Company is not, and upon the
issuance and sale of the Notes as herein contemplated and the application
of the net proceeds therefrom as described in the Prospectus will not be,
an "investment company" within the meaning of the Investment Company Act of
1940, as amended (the ("1940 Act").
(xv) COMMODITY EXCHANGE ACT. The Notes, upon issuance, will be
excluded or exempted under, or beyond the purview of, the Commodity
Exchange Act, as amended (the "Commodity Exchange Act"), and the rules and
regulations of the Commodity Futures Trading Commission under the Commodity
Exchange Act (the "Commodity Exchange Act Regulations").
(xvi) RATINGS. The Medium-Term Note Program under which the Notes
are issued (the "Program"), as well as the Notes, are rated A2 by Moody's
Investors Service, Inc. and A- by Standard & Poor's Ratings Services, or
such other rating as to which the Company shall have most recently notified
the Agents pursuant to Section 4(a) hereof.
(b) ADDITIONAL CERTIFICATIONS. Any certificate signed by any authorized
officer of the Company or any of its subsidiaries and delivered to one or more
Agents or to counsel for the Agents in connection with an offering of Notes to
one or more Agents as principal or through an Agent as agent shall be deemed a
representation and warranty by the Company to such Agent or Agents as to the
matters covered thereby on the date of such certificate and, unless subsequently
amended or supplemented, at each Representation Date subsequent thereto.
SECTION 3. PURCHASES AS PRINCIPAL; SOLICITATIONS AS AGENT.
(a) PURCHASES AS PRINCIPAL. Notes purchased from the Company by the
Agents, individually or in a syndicate, as principal shall be made in
accordance with terms agreed upon between such Agent or Agents and the Company
(which terms, unless otherwise agreed, shall, to the extent applicable, include
those terms specified in Exhibit A hereto and shall be agreed upon orally, with
written confirmation prepared by such Agent or Agents and delivered to the
Company by facsimile, courier service, hand delivery or mail). An Agent's
commitment to purchase Notes as principal 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. Unless the
context otherwise requires, references herein to "this Agreement" shall include
the applicable agreement of one or more Agents to purchase Notes from the
Company as principal. Each purchase of Notes, unless otherwise agreed, shall be
at a discount from the principal amount of each such Note equivalent to the
applicable commission set forth in Schedule A hereto. The Agents may engage the
services of any broker or dealer in connection with the resale of the Notes
purchased by them as principal and may allow all or any portion of the discount
received from the
10
Company in connection with such purchases to such brokers or dealers. At the
time of each purchase of Notes from the Company by one or more Agents as
principal, such Agent or Agents shall specify the requirements for the officers'
certificate, opinion of counsel and comfort letter pursuant to Sections 7(b),
7(c) and 7(d) hereof.
If the Company and two or more Agents enter into an agreement pursuant to
which such Agents agree to purchase Notes from the Company as principal and one
or more of such Agents shall fail at the Settlement Date to purchase the Notes
which it or they are obligated to purchase (the "Defaulted Notes"), then the
nondefaulting Agents shall have the right, within 24 hours thereafter, to make
arrangements for one of them or one or more other Agents or underwriters to
purchase all, but not less than all, of the Defaulted Notes in such amounts as
may be agreed upon and upon the terms herein set forth; provided, however, that
if such arrangements shall not have been completed within such 24-hour period,
then:
(a) if the aggregate principal amount of Defaulted Notes does not
exceed 10% of the aggregate principal amount of Notes to be so purchased by
all of such Agents on the Settlement Date, the nondefaulting Agents shall
be obligated, severally and not jointly, to purchase the full amount
thereof in the proportions that their respective initial underwriting
obligations bear to the underwriting obligations of all nondefaulting
Agents; or
(b) if the aggregate principal amount of Defaulted Notes exceeds 10%
of the aggregate principal amount of Notes to be so purchased by all of
such Agents on the Settlement Date, such agreement shall terminate without
liability on the part of any nondefaulting Agent.
No action taken pursuant to this paragraph shall relieve any defaulting Agent
from liability in respect of its default. In the event of any such default which
does not result in a termination of such agreement, either the nondefaulting
Agents or the Company shall have the right to postpone the Settlement Date for a
period not exceeding seven days in order to effect any required changes in the
Registration Statement or the Prospectus or in any other documents or
arrangements.
(b) SOLICITATIONS AS AGENT. On the basis of the representations and
warranties herein contained, but subject to the terms and conditions herein set
forth, when agreed by the Company and an Agent, such Agent, as an agent of the
Company, will use its reasonable best efforts to solicit offers for the purchase
of Notes upon the terms set forth in the Prospectus. The Agents are not
authorized to appoint sub-agents with respect to Notes sold through them as
agent. All Notes sold through an Agent as agent will be sold at 100% of their
principal amount unless otherwise agreed upon between the Company and such
Agent.
The Company reserves the right, in its sole discretion, to suspend
solicitation of offers for the purchase of Notes through an Agent, as an agent
of the Company, commencing at any time for any period of time or permanently. As
soon as practicable after receipt of instructions from the Company, such Agent
will suspend solicitation of offers for the purchase of Notes from the
11
Company until such time as the Company has advised such Agent that such
solicitation may be resumed.
The Company agrees to pay each Agent a commission, in the form of a
discount, equal to the applicable percentage of the principal amount of each
Note sold by the Company as a result of a solicitation made by such Agent, as an
agent of the Company, as set forth in Schedule A hereto.
(c) ADMINISTRATIVE PROCEDURES. The purchase price, interest rate or
formula, maturity date and other terms of the Notes specified in Exhibit A
hereto (as applicable) shall be agreed upon between the Company and the
applicable Agent(s) and specified in a pricing supplement to the Prospectus
(each, a "Pricing Supplement") to be prepared by the Company in connection with
each sale of Notes. Except as otherwise specified in the applicable Pricing
Supplement, the Notes will be issued in denominations of U.S. $1,000 or any
larger amount that is an integral multiple of U.S. $1,000. Administrative
procedures with respect to the issuance and sale of the Notes (the "Procedures")
shall be agreed upon from time to time among the Company, the Agents and the
Trustee. The Agents and the Company agree to perform, and the Company agrees to
cause the Trustee to agree to perform, their respective duties and obligations
specifically provided to be performed by them in the Procedures.
SECTION 4. COVENANTS OF THE COMPANY.
The Company covenants and agrees with each Agent as follows:
(a) NOTICE OF CERTAIN EVENTS. The Company will notify the Agents
immediately, and confirm such notice in writing as soon as reasonably
practicable, of (i) the effectiveness of any post-effective amendment to the
Registration Statement or the filing of any amendment or supplement to the
Prospectus (other than any amendment or supplement thereto providing solely for
the determination of the variable terms of the Notes or relating solely to the
offering of securities other than the Notes), (ii) the receipt of any comments
from the Commission related to the Registration Statement, (iii) any request by
the Commission for any amendment to the Registration Statement or any amendment
or supplement to the Prospectus or for additional information, (iv) the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement, or of any order preventing or suspending the use of any
preliminary prospectus, or of the initiation of any proceedings for that purpose
or (v) any change in the rating assigned by any nationally recognized
statistical rating organization to the Program or any debt securities (including
the Notes) of the Company, or the public announcement by any nationally
recognized statistical rating organization that it has under surveillance or
review, with possible negative implications, its rating of the Program or any
such debt securities, or the withdrawal by any nationally recognized statistical
rating organization of its rating of the Program or any such debt securities.
The Company will make every reasonable effort to prevent the issuance of any
stop order and, if any stop order is issued, to obtain the lifting thereof at
the earliest possible moment.
(b) FILING OR USE OF AMENDMENTS. The Company will give the Agents
advance notice of its intention to file or prepare any additional registration
statement with respect to the
12
registration of additional Notes, any amendment to the Registration Statement
(including any filing under Rule 462(b) of the 1933 Act Regulations) or any
amendment or supplement to the prospectus included in the Registration Statement
at the time it became effective or to the Prospectus (other than an amendment or
supplement thereto providing solely for the determination of the variable terms
of the Notes or relating solely to the offering of securities other than the
Notes), whether pursuant to the 1933 Act, the 1934 Act or otherwise, will
furnish to the Agents copies of any such document a reasonable amount of time
prior to such proposed filing or use, as the case may be, and will not file any
such document to which the Agents or counsel for the Agents shall reasonably
object.
(c) DELIVERY OF THE REGISTRATION STATEMENT. The Company has furnished to
each Agent and to counsel for the Agents, without charge, signed and conformed
copies of the Registration Statement as originally filed and of each amendment
thereto (including exhibits filed therewith or incorporated by reference therein
and documents incorporated or deemed to be incorporated by reference therein)
and signed and conformed copies of all consents and certificates of experts. The
Registration Statement and each amendment thereto furnished to the Agents will
be identical to any electronically transmitted copies thereof filed with the
Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.
(d) DELIVERY OF THE PROSPECTUS. The Company will deliver to each Agent,
without charge, as many copies of each preliminary prospectus as such Agent may
reasonably request, and the Company hereby consents to the use of such copies
for purposes permitted by the 1933 Act. The Company will furnish to each Agent,
without charge, such number of copies of the Prospectus (as amended or
supplemented) as such Agent may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Agents will be identical to
any electronically transmitted copies thereof filed with the Commission pursuant
to EDGAR, except to the extent permitted by Regulation S-T.
(e) PREPARATION OF PRICING SUPPLEMENTS. The Company will prepare, with
respect to any Notes to be sold to or through one or more Agents pursuant to
this Agreement, a Pricing Supplement with respect to such Notes in a form
previously approved by the Agents. The Company will deliver such Pricing
Supplement no later than 11:00 a.m., New York City time, on the business day
following the date of the Company's acceptance of the offer for the purchase of
such Notes and will file such Pricing Supplement pursuant to Rule 424(b)(3)
under the 1933 Act not later than the close of business of the Commission on the
fifth business day after the date on which such Pricing Supplement is first
used.
(f) REVISIONS OF PROSPECTUS -- MATERIAL CHANGEs. Except as otherwise
provided in subsection (m) of this Section 4, if at any time during the term of
this Agreement any event shall occur or condition shall exist as a result of
which it is necessary, in the reasonable opinion of counsel for the Agents or
counsel for the Company, to amend the Registration Statement in order that the
Registration Statement will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading or to amend or supplement the
Prospectus in order that the Prospectus will not include an untrue statement of
a material fact or omit to state a material fact necessary in order to make
13
the statements therein not misleading in the light of the circumstances existing
at the time the Prospectus is delivered to a purchaser, or if it shall be
necessary, in the reasonable opinion of either such counsel, to amend the
Registration Statement or amend or supplement the Prospectus in order to comply
with the requirements of the 1933 Act or the 1933 Act Regulations, the Company
shall give immediate notice, confirmed in writing, to the Agents to cease the
solicitation of offers for the purchase of Notes in their capacity as agents and
to cease sales of any Notes they may then own as principal, and the Company will
promptly prepare and file with the Commission, subject to Section 4(b) hereof,
such amendment or supplement as may be necessary to correct such statement or
omission or to make the Registration Statement and Prospectus comply with such
requirements, and the Company will furnish to the Agents, without charge, such
number of copies of such amendment or supplement as the Agents may reasonably
request. In addition, the Company will comply with the 1933 Act, the 1933 Act
Regulations, the 1934 Act and the 1934 Act Regulations so as to permit the
completion of the distribution of each offering of Notes.
(g) PROSPECTUS REVISIONS -- PERIODIC FINANCIAL INFORMATION. Except as
otherwise provided in subsection (m) of this Section 4, on or prior to the date
on which there shall be released to the general public interim financial
statement information related to the Company with respect to each of the first
three quarters of any fiscal year or preliminary financial statement information
with respect to any fiscal year, the Company shall furnish such information to
the Agents, confirmed in writing, and shall cause the Prospectus to be amended
or supplemented to include financial information with respect thereto and
corresponding information for the comparable period of the preceding fiscal
year, as well as such other information and explanations as shall be necessary
for an understanding thereof or as shall be required by the 1933 Act or the 1933
Act Regulations.
(h) PROSPECTUS REVISIONS -- AUDITED FINANCIAL INFORMATION. Except as
otherwise provided in subsection (m) of this Section 4, on or prior to the date
on which there shall be released to the general public financial information
included in or derived from the audited consolidated financial statements of the
Company for the preceding fiscal year, the Company shall furnish such
information to the Agents, confirmed in writing, and shall cause the Prospectus
to be amended or supplemented to include such audited consolidated financial
statements and the report or reports, and consent or consents to such inclusion,
of the independent accountants with respect thereto, as well as such other
information and explanations as shall be necessary for an understanding of such
consolidated financial statements or as shall be required by the 1933 Act or the
1933 Act Regulations.
(i) EARNING STATEMENTS. The Company will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally available
to its securityholders as soon as practicable an earning statement for the
purposes of, and to provide the benefits contemplated by, the last paragraph of
Section 11(a) of the 1933 Act.
(j) REPORTING REQUIREMENTS. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission pursuant to the 1934
Act within the time periods prescribed by the 1934 Act and the 1934 Act
Regulations.
14
(k) RESTRICTION ON OFFERS AND SALES OF SECURITIES. Unless otherwise
agreed upon between one or more Agents acting as principal and the Company,
between the date of the agreement by such Agent(s) to purchase the related Notes
from the Company and the Settlement Date with respect thereto, the Company will
not, without the prior written consent (which shall not be unreasonably
withheld) of such Agent(s), issue, sell, offer or contract to sell, grant any
option for the sale of, or otherwise dispose of, any debt securities of the
Company (other than the Notes that are to be sold pursuant to such agreement or
commercial paper in the ordinary course of business).
(l) QUALIFICATION OF SECURITIES. The Company will arrange for the
qualification of the Notes for sale under the laws of such jurisdictions as any
Agent(s) may designate, will maintain such qualifications in effect so long as
required for the distribution of the Notes, and will arrange for the
determination of the legality of the Notes for the purchase by institutional
investors.
(m) USE OF PROCEEDS. The Company will use the net proceeds received by it
from the issuance and sale of the Notes in the manner specified in the
Prospectus.
(n) SUSPENSION OF CERTAIN OBLIGATIONS. The Company shall not be required
to comply with the provisions of subsections (f), (g) or (h) of this Section 4
during any period from the time (i) the Agents shall have suspended solicitation
of offers for the purchase of Notes in their capacity as agents pursuant to a
request from the Company and (ii) no Agent shall then hold any Notes purchased
from the Company as principal, as the case may be, until the time the Company
shall determine that solicitation of offers for the purchase of Notes should be
resumed or an Agent shall subsequently purchase Notes from the Company as
principal.
SECTION 5. CONDITIONS OF AGENTS' OBLIGATIONS.
The obligations of one or more Agents to purchase Notes from the Company
as principal and to solicit offers for the purchase of Notes as an agent of the
Company, and the obligations of any purchasers of Notes sold through an Agent as
an agent of the Company, will be subject to the accuracy of the representations
and warranties on the part of the Company herein contained or contained in any
certificate of an officer of the Company or any of its subsidiaries delivered
pursuant to the provisions hereof, to the performance and observance by the
Company of its covenants and other obligations hereunder, and to the following
additional conditions precedent:
(a) EFFECTIVENESS OF REGISTRATION STATEMENT. The Registration Statement
(including any Rule 462(b) Registration Statement) has become effective under
the 1933 Act and no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act and no proceedings for that
purpose shall have been instituted or shall be pending or threatened by the
Commission, and any request on the part of the Commission for additional
information shall have been complied with to the reasonable satisfaction of
counsel to the Agents.
(b) LEGAL OPINIONS. On the date hereof, the Agents shall have received the
following legal opinions, dated as of the date hereof and in form and substance
satisfactory to the Agents:
15
(1) OPINION OF COUNSEL FOR THE COMPANY. The favorable opinions of (A)
Jennie P. Carlson, Esq., General Counsel for the Company, to the effect set
forth in Exhibit B and (B) Wachtell, Lipton, Rosen & Katz, counsel to the
Company, to the effect set forth in Exhibit C hereto, and to such further
effect as the Agents may reasonably request and as to matters involving the
application of laws of the State of Wisconsin, such counsel may rely, to
the extent deemed proper and specified in such opinion, upon the opinion of
Nolan Zadra, Esq., Assistant General Counsel of the Company, which opinion,
to the effect set forth in the form of Exhibit D hereto and shall expressly
authorize such reliance.
(2) OPINION OF COUNSEL FOR THE AGENTS. The favorable opinion of
Simpson Thacher & Bartlett, counsel for the Agents, with respect to the
issuance and sale of the Notes, the Indenture, the Prospectus, the
Registration Statement, and, as to matters involving the application of
laws of the State of Wisconsin, Simpson Thacher & Bartlett may rely, to the
extent deemed proper and specified in such opinion, upon the opinion of
Nolan Zadra, Esq., Assistant General Counsel of the Company, which opinion,
to the effect set forth in the form of Exhibit D hereto and shall expressly
authorize such reliance.
(c) OFFICER'S CERTIFICATE. On the date hereof, there shall not have been,
since the respective dates as of which information is given in the Prospectus,
any material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise, whether or not arising in the
ordinary course of business, and the Agents shall have received a certificate of
the President or a Vice President of the Company and of the chief financial
officer or chief accounting officer of the Company, dated as of the date hereof,
to the effect that (i) there has been no such material adverse change, (ii) the
representations and warranties of the Company herein contained are true and
correct with the same force and effect as though expressly made at and as of the
date of such certificate, (iii) the Company has complied with all agreements and
satisfied all conditions on its part to be performed or satisfied at or prior to
the date of such certificate, and (iv) no stop order suspending the
effectiveness of the Registration Statement has been issued and no proceedings
for that purpose have been instituted, are pending or, to the best of such
officer's knowledge, are threatened by the Commission.
(d) COMFORT LETTERS. On the date hereof, the Agents shall have received
letters from PriceWaterhouseCoopers LLP and KPMG LLP, dated as of the date
hereof and in form and substance satisfactory to the Agents, to the effect set
forth in Exhibit E hereto.
(e) ADDITIONAL DOCUMENTS. On the date hereof, counsel to the Agents shall
have been furnished with such documents and opinions as such counsel may require
for the purpose of enabling such counsel to pass upon the issuance and sale of
Notes as herein contemplated and related proceedings, or in order to evidence
the accuracy of any of the representations and warranties, or the fulfillment of
any of the conditions, herein contained; and all proceedings taken by the
Company in connection with the issuance and sale of Notes as herein contemplated
shall be satisfactory in form and substance to the Agents and to counsel to the
Agents.
16
If any condition specified in this Section 5 shall not have been fulfilled
when and as required to be fulfilled, this Agreement may be terminated by the
applicable Agent or Agents by notice to the Company at any time and any such
termination shall be without liability of any party to any other party except as
provided in Section 10 hereof and except that Sections 8, 9, 11, 14 and 15
hereof shall survive any such termination and remain in full force and effect.
SECTION 6. DELIVERY OF AND PAYMENT FOR NOTES SOLD THROUGH AN AGENT AS AGENT.
Delivery of Notes sold through an Agent as an agent of the Company shall
be made by the Company to such Agent for the account of any purchaser only
against payment therefor in immediately available funds. In the event that a
purchaser shall fail either to accept delivery of or to make payment for a Note
on the date fixed for settlement, such Agent shall promptly notify the Company
and deliver such Note to the Company and, if such Agent has theretofore paid the
Company for such Note, the Company will promptly return such funds to such
Agent. If such failure has occurred for any reason other than default by such
Agent in the performance of its obligations hereunder, the Company will
reimburse such Agent on an equitable basis for its loss of the use of the funds
for the period such funds were credited to the Company's account.
SECTION 7. ADDITIONAL COVENANTS OF THE COMPANY.
The Company further covenants and agrees with each Agent as follows:
(a) REAFFIRMATION OF REPRESENTATIONS AND WARRANTIES. Each acceptance by
the Company of an offer for the purchase of Notes (whether to one or more
Agents as principal or through an Agent as agent), and each delivery of Notes
(whether to one or more Agents as principal or through an Agent as agent),
shall be deemed to be an affirmation that the representations and warranties of
the Company herein contained and contained in any certificate theretofore
delivered to the Agents pursuant hereto are true and correct at the time of
such acceptance or sale, as the case may be, and an undertaking that such
representations and warranties will be true and correct at the time of delivery
to such Agent(s) or to the purchaser or its agent, as the case may be, of the
Notes relating to such acceptance or sale, as the case may be, as though made at
and as of each such time (it being understood that such representations and
warranties shall relate to the Registration Statement and Prospectus as amended
and supplemented to each such time).
(b) SUBSEQUENT DELIVERY OF CERTIFICATES. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented (other
than by an amendment or supplement providing solely for the determination of the
variable terms of the Notes or relating solely to the offering of securities
other than the Notes), (ii) (if required in connection with the purchase of
Notes from the Company by one or more Agents as principal) the Company sells
Notes to one or more Agents as principal or (iii) the Company sells Notes in a
form not previously certified to the Agents by the Company, the Company shall
furnish or cause to be furnished to the Agent(s), forthwith a certificate dated
the date of filing with the Commission or the date of effectiveness of such
amendment or supplement, as applicable, or the date of such sale, as the case
may be, in form satisfactory to the Agent(s) to the effect that the statements
contained in the certificate
17
referred to in Section 5(c) hereof which were last furnished to the Agents are
true and correct at the time of the filing or effectiveness of such amendment or
supplement, as applicable, or the time of such sale, as the case may be, as
though made at and as of such time (except that such statements shall be deemed
to relate to the Registration Statement and the Prospectus as amended and
supplemented to such time) or, in lieu of such certificate, a certificate of the
same tenor as the certificate referred to in Section 5(c) hereof, modified as
necessary to relate to the Registration Statement and the Prospectus as amended
and supplemented to the time of delivery of such certificate (it being
understood that, in the case of clause (ii) above, any such certificate shall
also include a certification that there has been no material adverse change in
the condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise since the date of the agreement by such Agent(s) to purchase Notes
from the Company as principal).
(c) SUBSEQUENT DELIVERY OF LEGAL OPINIONS. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented (other
than by an amendment or supplement providing solely for the determination of the
variable terms of the Notes or relating solely to the offering of securities
other than the Notes), (ii) (if required in connection with the purchase of
Notes from the Company by one or more Agents as principal) the Company sells
Notes to one or more Agents as principal or (iii) the Company sells Notes in a
form not previously certified to the Agents by the Company, the Company shall
furnish or cause to be furnished forthwith to the Agent(s) and to counsel to the
Agents the written opinion of Wachtell, Lipton, Rosen & Katz, counsel to the
Company, or other counsel reasonably satisfactory to the Agent(s), dated the
date of filing with the Commission or the date of effectiveness of such
amendment or supplement, as applicable, or the date of such sale, as the case
may be, in form and substance reasonably satisfactory to the Agent(s), of the
same tenor as the opinion referred to in Section 5(b)(1)(A) hereof, but
modified, as necessary, to relate to the Registration Statement and the
Prospectus as amended and supplemented to the time of delivery of such opinion
or, in lieu of such opinion, counsel last furnishing such opinion to the Agents
shall furnish the Agent(s) with a letter substantially to the effect that the
Agent(s) may rely on such last opinion to the same extent as though it was dated
the date of such letter authorizing reliance (except that statements in such
last opinion shall be deemed to relate to the Registration Statement and the
Prospectus as amended and supplemented to the time of delivery of such letter
authorizing reliance).
(d) SUBSEQUENT DELIVERY OF COMFORT LETTERS. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented to
include additional financial information (other than by an amendment or
supplement relating solely to the issuance and/or offering of securities other
than the Notes) or (ii) (if required in connection with the purchase of Notes
from the Company by one or more Agents as principal) the Company sells Notes to
one or more Agents as principal, the Company shall cause PriceWaterhouseCoopers
LLP and KPMG LLP forthwith to furnish to the Agent(s) a letter, dated the date
of filing with the Commission or the date of effectiveness of such amendment or
supplement, as applicable, or the date of such sale, as the case may be, in form
satisfactory to the Agent(s), of the same tenor as the letter referred to in
Section 5(d) hereof but modified to relate to the Registration Statement and
Prospectus as amended and supplemented to the date of such letter.
18
SECTION 8. INDEMNIFICATION.
(a) INDEMNIFICATION OF THE AGENTS. The Company agrees to indemnify and
hold harmless each Agent and each person, if any, who controls such Agent
within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act
as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of an untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), or the omission or alleged omission therefrom
of a material fact required to be stated therein or necessary to make the
statements therein not misleading, or arising out of an untrue statement or
alleged untrue statement of a material fact included in any preliminary
prospectus or the Prospectus (or any amendment or supplement thereto), or
the omission or alleged omission therefrom of a material fact necessary in
order to make the statements therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, provided that (subject to Section
8(d) hereof) any such settlement is effected with the written consent of
the Company; and
(iii) against any and all expense whatsoever, as incurred (including
the fees and disbursements of counsel chosen by such Agent), reasonably
incurred in investigating, preparing or defending against any litigation,
or any investigation or proceeding by any governmental agency or body,
commenced or threatened, or any claim whatsoever based upon any such untrue
statement or omission, or any such alleged untrue statement or omission, to
the extent that any such expense is not paid under subparagraph (i) or (ii)
above;
PROVIDED, HOWEVER, that this indemnity does not apply to any loss, liability,
claim, damage or expense to the extent arising out of an untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in
conformity with written information furnished to the Company by such Agent
expressly for use in the Registration Statement (or any amendment thereto) or
any preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(b) INDEMNIFICATION OF COMPANY, DIRECTORS AND OFFICERS. Each Agent
severally agrees to indemnify and hold harmless the Company, its directors, each
of its officers who signed the Registration Statement and each person, if any,
who controls the Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act against any and all loss, liability, claim, damage
and expense described in the indemnity contained in Section 8(a) hereof, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendment thereto) or any preliminary prospectus or
19
the Prospectus (or any amendment or supplement thereto) in reliance upon and in
conformity with written information furnished to the Company by the Agents
expressly for use in the Registration Statement (or any amendment thereto) or
such preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(c) ACTIONS AGAINST PARTIES; NOTIFICATION. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 8(a) hereof,
counsel to the indemnified parties shall be selected by the applicable Agent(s)
and, in the case of parties indemnified pursuant to Section 8(b) hereof, counsel
to the indemnified shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; PROVIDED,
HOWEVER, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 8 or 9 hereof (whether or not the indemnified parties are
actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
(d) SETTLEMENT WITHOUT CONSENT IF FAILURE TO REIMBURSE. If at any time an
indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 8(a)(ii) effected without its written consent if (i) such settlement is
entered into more than 45 days after receipt by such indemnifying party of the
aforesaid request, (ii) such indemnifying party shall have received notice of
the terms of such settlement at least 30 days prior to such settlement being
entered into and (iii) such indemnifying party shall not have reimbursed such
indemnified party in accordance with such request prior to the date of such
settlement.
SECTION 9. CONTRIBUTION. If the indemnification provided for in Section 8
hereof is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each
20
indemnifying party shall contribute to the aggregate amount of such losses,
liabilities, claims, damages and expenses incurred by such indemnified party, as
incurred, (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company, on the one hand, and the applicable Agent(s),
on the other hand, from the offering of the Notes that were the subject of the
claim for indemnification or (ii) if the allocation provided by clause (i) is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company, on the one hand, and the applicable Agent(s), on
the other hand, in connection with the statements or omissions which resulted in
such losses, liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
The relative benefits received by the Company, on the one hand, and
the applicable Agent(s), on the other hand, in connection with the offering of
the Notes that were the subject of the claim for indemnification 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 and
the total discount or commission received by each applicable Agent, as the case
may be, bears to the aggregate initial offering price of such Notes.
The relative fault of the Company, on the one hand, and the
applicable Agent(s), on the other hand, shall be determined by reference to,
among other things, whether any untrue or alleged untrue statement of a material
fact or omission or alleged omission to state a material fact relates to
information supplied by the Company or by the applicable Agent(s) and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Company and the Agents agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro rata
allocation (even if the applicable Agent(s) were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 9. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 9 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any applicable untrue or alleged
untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 9, (i) no Agent shall
be required to contribute any amount in excess of the amount by which the total
discount or commission received by such Agent in connection with the offering of
the Notes that were the subject of the claim for indemnification exceeds the
amount of any damages which such Agent has otherwise been required to pay by
reason of any applicable untrue or alleged untrue statement or omission or
alleged omission and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. In addition, in connection with an offering of Notes
purchased from the Company by two or more Agents as principal, the respective
obligations of
21
such Agents to contribute pursuant to this Section 9 are several, and not joint,
in proportion to the aggregate principal amount of Notes that each such Agent
has agreed to purchase from the Company.
For purposes of this Section 9, each person, if any, who controls an
Agent within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934
Act shall have the same rights to contribution as such Agent, and each director
of the Company, each officer of the Company and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act or Section
20 of the 1934 Act shall have the same rights to contribution as the Company.
SECTION 10. PAYMENT OF EXPENSES.
The Company will pay all expenses incident to the performance of its
obligations under this Agreement, including:
(a) The preparation, filing, printing and delivery of the Registration
Statement as originally filed and all amendments thereto and any preliminary
prospectus, the Prospectus and any amendments or supplements thereto;
(b) The preparation, printing and delivery of this Agreement and the
Indenture;
(c) The preparation, issuance and delivery of the Notes, including any
fees and expenses relating to the eligibility and issuance of Notes in
book-entry form and the cost of obtaining CUSIP or other identification numbers
for the Notes;
(d) The fees and disbursements of the Company's accountants, counsel and
other advisors or agents (including any calculation agent or exchange rate
agent) and of the Trustee and its counsel;
(e) The reasonable fees and disbursements of counsel to the Agents
incurred in connection with the establishment of the Program and incurred from
time to time in connection with the transactions contemplated hereby;
(f) The fees charged by nationally recognized statistical rating
organizations for the rating of the Program and the Notes;
(g) The fees and expenses incurred in connection with any listing of
Notes on a securities exchange;
(h) The filing fees incident to, and the reasonable fees and
disbursements of counsel to the Agents in connection with, the review, if any,
by the National Association of Securities Dealers, Inc. (the "NASD"); and
22
(i) Any advertising and other out-of-pocket expenses of the Agents
incurred with the approval of the Company.
SECTION 11. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY.
All representations, warranties and agreements contained in this Agreement
or in certificates of officers of the Company or any of its subsidiaries
submitted pursuant hereto or thereto shall remain operative and in full force
and effect, regardless of any investigation made by or on behalf of the Agents
or any controlling person of an Agent, or by or on behalf of the Company, and
shall survive each delivery of and payment for the Notes.
SECTION 12. TERMINATION.
(a) TERMINATION OF THIS AGREEMENT. This Agreement (excluding any agreement
by one or more Agents to purchase Notes from the Company as principal) may be
terminated for any reason, at any time by either the Company or an Agent, as to
itself, upon the giving of 30 days' prior written notice of such termination to
the other party hereto.
(b) TERMINATION OF AGREEMENT TO PURCHASE NOTES AS PRINCIPAL. The
applicable Agent(s) may terminate any agreement by such Agent(s) to purchase
Notes from the Company as principal, immediately upon notice to the Company, at
any time prior to the Settlement Date relating thereto, if (i) there has been,
since the date of such agreement or since the respective dates as of which
information is given in the Prospectus, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, or (ii)
there has occurred any material adverse change in the financial markets in the
United States or, if such Notes are denominated and/or payable in, or indexed
to, one or more foreign or composite currencies, in the international financial
markets, or any outbreak of hostilities or escalation thereof or other calamity
or crisis or any change or development or event involving a prospective change
in national or international political, financial or economic conditions, in
each case the effect of which is such as to make it, in the judgment of such
Agent(s), impracticable to market such Notes or enforce contracts for the sale
of such Notes, or (iii) trading in any securities of the Company has been
suspended or materially limited by the Commission or a national securities
exchange, or if trading generally on the New York Stock Exchange or the American
Stock Exchange or in the Nasdaq National Market has been suspended or materially
limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by either of said exchanges or by such
system or by order of the Commission, the NASD or any other governmental
authority, or (iv) a banking moratorium has been declared by either Federal or
New York authorities or by the relevant authorities in the country or countries
of origin of any foreign or composite currency in which such Notes are
denominated and/or payable, or (v) the rating assigned by any nationally
recognized statistical rating organization to the Program or any debt securities
(including the Notes) of the Company as of the date of such agreement shall have
been lowered or withdrawn since that date or if any such rating organization
shall have publicly announced that it has under surveillance or review its
rating of the Program or any such debt securities (with a view toward lowering
or withdrawing such
23
rating), or (vi) there shall have come to the attention of such Agent(s) any
facts that would cause such Agent(s) to reasonably believe that the Prospectus,
at the time it was required to be delivered to a purchaser of such Notes,
included an untrue statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances existing at the time of such delivery, not misleading.
(c) GENERAL. In the event of any such termination, neither party will have
any liability to the other party hereto, except that (i) the Agents shall be
entitled to any commissions earned in accordance with the third paragraph of
Section 3(b) hereof, (ii) if at the time of termination (a) any Agent shall own
any Notes purchased by it from the Company as principal or (b) an offer to
purchase any of the Notes has been accepted by the Company but the time of
delivery to the purchaser or his agent of such Notes relating thereto has not
occurred, the covenants set forth in Sections 4 and 7 hereof shall remain in
effect until such Notes are so resold or delivered, as the case may be, and
(iii) the covenant set forth in Section 4(i) hereof, the provisions of Section
10 hereof, the indemnity and contribution agreements set forth in Sections 8 and
9 hereof, and the provisions of Sections 11, 14 and 15 hereof shall remain in
effect.
SECTION 13. NOTICES.
Unless otherwise provided herein, all notices required under the terms and
provisions hereof shall be in writing, either delivered by hand, by mail or by
telex, telecopier or telegram, and any such notice shall be effective when
received at the addresses specified below.
If to the Company:
Firstar Corporation
777 East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Attention: General Counsel
Telephone No.: (414) 765-5717
Telecopy No.: (414) 765-6111
If to the Agents:
Goldman, Sachs & Co.
85 Broad St., 6th Floor
New York, NY 10004
Attention: Ivan Lopez, Corporate Bond Operations
Telephone No.: (212) 902-5976
Telecopy No.: (212) 902-3000
Merrill Lynch & Co.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
24
North Tower 15th Floor
New York, New York 10281-1315
Attention: MTN Product Management
Telecopy No.: (212) 449-2234
Morgan Stanley & Co. Incorporated
1585 Broadway
2nd Floor
New York, New York 10036
Attention: Manager-Continuously Offered Products
Telephone No.: (212) 761-4000
Telecopy No.: (212) 761-0780
with a copy to:
Morgan Stanley & Co. Incorporated
1585 Broadway
34th Floor
New York, New York 10036
Attention: Peter Cooper, Investment Banking Information Center
Telephone No.: (212) 761-8385
Telecopy No.: (212) 761-0260; and
Salomon Smith Barney Inc.
Medium-Term Note Department
World Trade Center
New York, NY 10048
Telephone No.: (212) 783-5897
Telecopy No.: (212) 783-2274
If to any other Agent, to such address or telecopy number as such Agent
shall have furnished to the other parties hereto;
or to such other address or telecopy number as such party may designate from
time to time by notice duly given in accordance with the terms of this Section
13.
SECTION 14. PARTIES.
This Agreement shall inure to the benefit of and be binding upon the
Agents and the Company and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto and their respective
successors and the controlling persons, officers and directors referred to in
Sections 8 and 9 hereof and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive
25
benefit of the parties hereto and their respective successors, and said
controlling persons, officers and directors and their heirs and legal
representatives, and for the benefit of no other person, firm or corporation. No
purchaser of Notes shall be deemed to be a successor by reason merely of such
purchase.
SECTION 15. GOVERNING LAW; FORUM.
THIS AGREEMENT AND ALL THE RIGHTS AND OBLIGATIONS OF THE PARTIES SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES. ANY SUIT, ACTION OR PROCEEDING
BROUGHT BY THE COMPANY AGAINST ANY AGENT IN CONNECTION WITH OR ARISING UNDER
THIS AGREEMENT SHALL BE BROUGHT SOLELY IN THE STATE OR FEDERAL COURT OF
APPROPRIATE JURISDICTION LOCATED IN THE BOROUGH OF MANHATTAN, THE CITY OF NEW
YORK.
SECTION 16. EFFECT OF HEADINGS.
The Article and Section headings herein are for convenience only and shall
not affect the construction hereof.
SECTION 17. COUNTERPARTS.
This Agreement may be executed in one or more counterparts and, if
executed in more than one counterpart, the executed counterparts hereof shall
constitute a single instrument.
26
If the foregoing is in accordance with the Agents' understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this Distribution Agreement, along with all counterparts, will become a binding
agreement among the Agents and the Company in accordance with its terms.
Very truly yours,
FIRSTAR CORPORATION
By:
-------------------------------
Name: David M. Moffett
Title: Vice Chairman and
Chief Financial Officer
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By:
-------------------------------
Name:
Title
BANC OF AMERICA SECURITIES LLC
By:
-------------------------------
Name:
Title
BEAR, STEARNS & CO. INC.
By:
-------------------------------
Name:
Title
27
CREDIT SUISSE FIRST BOSTON CORPORATION
By:
-------------------------------
Name:
Title
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By:
-------------------------------
Name:
Title
GOLDMAN, SACHS & CO.
By:
-------------------------------
Name:
Title
LEHMAN BROTHERS INC.
By:
-------------------------------
Name:
Title
28
MORGAN STANLEY & CO. INCORPORATED
By:
-------------------------------
Name:
Title
SALOMON SMITH BARNEY INC.
By:
-------------------------------
Name:
Title
SCHEDULE A
As compensation for the services of the Agents hereunder, the Company
shall pay the applicable Agent, on a discount basis, a commission for the sale
of each Note equal to the principal amount of such Note multiplied by the
appropriate percentage set forth below:
PERCENT OF
MATURITY RANGES PRINCIPAL AMOUNT
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 30 years ..................................... .750
Greater than 30 years ......................................... *
- ----------------------------
* As agreed by the Company and the applicable Agent at the time of sale.
EXHIBIT A
PRICING TERMS
Principal Amount:$______
(or principal amount of foreign or composite currency)
Interest Rate or Formula:
If Fixed Rate Note,
Interest Rate:
Interest Payment Dates:
If Floating Rate Note,
Interest Rate Basis(es):
If LIBOR,
[__] LIBOR Reuters Page:
[__] LIBOR Telerate Page:
Designated LIBOR Currency:
If CMT Rate,
Designated CMT Telerate Page:
If Telerate Pate 7052:
[__] Weekly Average
[__] Monthly Average
Designated CMT Maturity Index:
Index Maturity:
Spread and/or Spread Multiplier, if any:
Initial Interest Rate, if any:
Initial Interest Reset Date:
Interest Reset Dates:
Interest Payment Dates:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Fixed Interest Rate, if any:
Day Count Convention:
Calculation Agent:
Redemption Provisions:
Initial Redemption Date
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
Repayment Provisions:
Optional Repayment Date(s):
Original Issue Date:
Stated Maturity Date:
Specified Currency:
Exchange Rate Agent:
Authorized Denomination:
A-1
Purchase Price: ___%, plus accrued interest, if any, from _________
Price to Public: ___%, plus accrued interest, if any, from _________
Issue Price:
Settlement Date and Time:
Additional/Other Terms:
Also, in connection with the purchase of Notes from the Company by one or more
Agents as principal, agreement as to whether the following will be required:
Officers' Certificate pursuant to Section 7(b) of the Distribution
Agreement. Legal Opinion pursuant to Section 7(c) of the Distribution
Agreement. Comfort Letter pursuant to Section 7(d) of the Distribution
Agreement.
A-2
EXHIBIT B
FORM OF OPINIONS OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)(1)(A)
EXHIBIT C
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)(1)(B)
EXHIBIT D
FORM OF OPINION OF ASSISTANT GENERAL
COUNSEL OF THE COMPANY
EXHIBIT E
FORM OF ACCOUNTANT'S COMFORT LETTER
PURSUANT TO SECTION 5(d)
FIRSTAR CORPORATION
ADMINISTRATIVE PROCEDURES
FOR FIXED RATE AND FLOATING RATE MEDIUM-TERM NOTES
(Dated as of July 20, 1999)
Medium-Term Notes Due Nine Months or More From Date of Issue (the
"Notes") are to be offered on a continuous basis by FIRSTAR CORPORATION, a
Wisconsin corporation (the "Company"), to or through Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated, Banc of America Securities
LLC, Bear, Stearns & Co. Inc., Donaldson, Lufkin & Jenrette Securities
Corporation, Credit Suisse First Boston Corporation, Goldman, Sachs & Co.,
Lehman Brothers Inc., Morgan Stanley & Co. Incorporated and Salomon Smith Barney
Inc. (each, an "Agent" and, collectively, the "Agents") pursuant to a
Distribution Agreement, dated July 20, 1999 (the "Distribution Agreement"), by
and among the Company and the Agents. The Distribution Agreement provides both
for the sale of Notes by the Company to one or more of the Agents as principal
for resale to investors and other purchasers and for the sale of Notes by the
Company directly to investors (as may from time to time be agreed to by the
Company and the related Agent or Agents), in which case each such Agent will act
as an agent of the Company in soliciting purchases of Notes.
Unless otherwise agreed by the related Agent or Agents and the
Company, Notes will be purchased by the related Agent or Agents as principal.
Such purchases will be made in accordance with terms agreed upon by the related
Agent or Agents and the Company (which terms shall be agreed upon orally, with
written confirmation prepared by the related Agent or Agents and mailed to the
Company). If agreed upon by any Agent or Agents and the Company, the Agent or
Agents, acting solely as agent or agents for the Company and not as principal,
will use reasonable efforts to solicit offers to purchase the Notes. Only those
provisions in these Administrative Procedures that are applicable to the
particular role to be performed by the related Agent or Agents shall apply to
the offer and sale of the relevant Notes.
The Notes will be issued as a series of debt securities under an
Indenture, dated as of June 22, 1999, as amended, supplemented or modified from
time to time (the "Indenture"), between the Company and Citibank, N.A., as
trustee (together with any successor in such capacity, the "Trustee").
The Company may appoint Firstar Bank, N.A. as Authenticating Agent
pursuant to Section 6.14 of the Indenture and in that event, Firstar Bank N.A.,
in addition to the Trustee, shall be authorized to authenticate Notes, as
hereinafter provided. The Company may also appoint Firstar Bank, N.A. as an
additional Paying Agent pursuant to Section 3.1 of the Indenture, and in that
event, Firstar Bank N.A., in addition to the Trustee, shall be authorized to act
as Paying Agent with respect to the Notes as provided herein and in the
Indenture. Accordingly, if such appointments are made, references to the
"Trustee" throughout this Distribution Agreement should be read to mean such
Trustee, Authenticating Agent or Paying Agent, as applicable.
The Company has filed a Registration Statement with the Securities
and Exchange Commission (the "Commission") registering, among other securities,
debt securities (which include the Notes) (the "Registration Statement", which
term shall include any additional
2
registration statements filed in connection with the Notes). The most recent
base prospectus deemed part of the Registration Statement, as supplemented with
respect to the Notes, is herein referred to as "Prospectus". The most recent
supplement to the Prospectus setting forth the purchase price, interest rate or
formula, maturity date and other terms of a particular issue of Notes (as
applicable) is herein referred to as the "Pricing Supplement".
The Notes will either be issued (a) in book-entry form and
represented by one or more fully registered Notes without coupons (each, a
"Global Note") delivered to the Trustee, as agent for The Depository Company
("DTC"), and recorded in the book-entry system maintained by DTC, or (b) in
certificated form (each, a "Certificated Note") delivered to the investor or
other purchaser thereof or a person designated by such investor or other
purchaser.
General procedures relating to the issuance of all Notes are set
forth in Part I hereof. Terms of the Additionally, Notes issued in book-entry
form will be issued in accordance with the procedures set forth in Part II
hereof and Certificated Notes will be issued in accordance with the procedures
set forth in Part III hereof. Capitalized terms used but not otherwise defined
herein shall have the meanings ascribed thereto in the Indenture or the Notes,
as the case may be.
PART XVIII: PROCEDURES OF GENERAL
APPLICABILITY
Date of Issuance/
Authentication: Each Note will be dated as of the date of its
authentication by the Trustee. Each Note shall also
bear an original issue date (each, an "Original Issue
Date"). The Original Issue Date shall remain the same
for all Notes subsequently issued upon transfer,
exchange or substitution of an original Note
regardless of their dates of authentication.
Maturities: Each Note will mature on a date nine months or more
from its Original Issue Date (the "Stated Maturity
Date") selected by the investor or other purchaser and
agreed to by the Company.
Registration: Unless otherwise provided in the applicable Pricing
Supplement, Notes will be issued only in fully
registered form.
Denominations: Unless otherwise provided in the applicable Pricing
Supplement, the Notes will be issued in denominations
of $1,000 and integral multiples thereof.
Interest Rate Bases
applicable to
Floating Rate
Notes: Floating Rate Notes will bear interest as described
in the Prospectus and Pricing Supplement.
3
Redemption/Repayment: The Notes will be subject to redemption by the
Company, if at all, in accordance with the terms of
the Notes, which will be fixed at the time of sale
and set forth in the applicable Pricing Supplement.
If no Initial Redemption Date is indicated with
respect to a Note, such Note will not be redeemable
prior to its Stated Maturity Date.
The Notes will be subject to repayment at the option
of the Holders thereof in accordance with the terms
of the Notes, which will be fixed at the time of sale
and set forth in the applicable Pricing Supplement.
If no Optional Repayment Date is indicated with
respect to a Note, such Note will not be repayable at
the option of the Holder prior to its Stated Maturity
Date.
Interest: Interest will be calculated and will be payable as
set forth in the Prospectus and the applicable
Pricing Supplement.
Acceptance and
Rejection of Offers
from Solicitation
as Agents: If agreed upon by any Agent and the Company, then
such Agent acting solely as agent for the Company and
not as principal will solicit purchases of the
Notes. Each Agent will communicate to the Company,
orally or in writing, each reasonable offer to
purchase Notes solicited by such Agent on an agency
basis, other than those offers rejected by such
Agent. Each Agent has the right, in its discretion
reasonably exercised, to reject any proposed purchase
of Notes, as a whole or in part, and any such
rejection shall not be a breach of such Agent's
agreement contained in the Distribution Agreement.
The Company has the sole right to accept or reject
any proposed purchase of Notes, in whole or in part,
and any such rejection shall not a breach of the
Company's agreement contained in the Distribution
Agreement. Each Agent has agreed to make reasonable
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.
Preparation of
Pricing Supplement: If any offer to purchase a Note is accepted by the
Company, the Company will promptly prepare a Pricing
Supplement reflecting the terms of such Note.
Information to be included in the Pricing Supplement
shall include:
4
1. the name of the Company;
2. the title of the Notes;
3. the date of the Pricing Supplement and the date
of the Prospectus to which the Pricing
Supplement relates;
4. the name of the Offering Agent (as defined
below);
5. whether such Notes are being sold to the Offering
Agent as principal or to an investor or other
purchaser through the Offering Agent acting as
agent for the Company;
6. with respect to Notes sold to the Offering
Agent as principal, whether such Notes will be
resold by the Offering Agent to investors and
other purchasers at (i) a fixed public offering
price of a specified percentage of their
principal amount or (ii) at varying prices
related to prevailing market prices at the time
of resale to be determined by the Offering Agent;
7. with respect to Notes sold to an investor or
other purchaser through the Offering Agent acting
as agent for the Company, whether such Notes will
be sold at (i) 100% of their principal amount or
(ii) a specified percentage of their principal
amount;
8. the Offering Agent's discount or commission;
9. Net proceeds to the Company;
10. the Principal Amount, Specified Currency,
Original Issue Date, Stated Maturity Date,
Interest Payment Date(s), Authorized
Denomination, Initial Redemption Date, if any,
Initial Redemption Percentage, if any, Annual
Redemption Percentage Reduction, if any, Optional
Repayment Date(s), if any, Exchange Rate Agent,
if any, Default Rate, if any, and, in the case of
Fixed Rate Notes, the Interest Rate, and whether
such Fixed Rate Note is an Original Issue
Discount Note (and, if so, the Issue Price), and,
in the case of Floating Rate Notes, the Interest
Category, the Interest Rate Basis or Bases, the
Day Count Convention, Index Maturity (if
applicable), Initial Interest Rate, if any,
Maximum Interest Rate, if any, Minimum Interest
Rate, if any, Initial Interest Reset Date,
Interest Reset Dates, Spread and/or Spread
Multiplier, if any, and Calculation Agent; and
5
11. any other additional provisions of the Notes
material to investors or other purchasers of the
Notes not otherwise specified in the Prospectus.
The Company shall use its reasonable best
efforts to send such Pricing Supplement by
telecopy or overnight express (for delivery by
the close of business on the applicable trade
date, but in no event later than 11:00 a.m. New
York City time, on the Business Day following
the applicable trade date) to the Agent which
made or presented the offer to purchase the
applicable Note (in such capacity, the "Offering
Agent") and the Trustee at the following
applicable addresses:
if to Goldman, Sachs & Co., to: Goldman,
Sachs & Co., 85 Broad St., New York, NY
10004, Attention: Money Market Origination/
Ben Smilchensky, telephone: (212) 902-1000,
telecopier: (212) 902-3000;
if to Merrill Lynch & Co., to: Merrill Lynch
Production Technologies, 44B Colonial Drive,
Piscataway, New Jersey 08854, Attention:
Prospectus Operations/ Nachman Kimerling,
telephone: (732) 885-2768, telecopier:
(732) 885-2774/5/6; for record keeping
purposes, one copy of such Pricing Supplement
shall also be mailed to Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith
Incorporated, World Financial Center, North
Tower, 15th floor, New York, NY 10281-1315
Attention: MTN Product Management,
telephone: (212) 449-7476, telecopier (212)
449-2234;
if to Morgan Stanley & Co. Incorporated, to:
Morgan Stanley & Co. Incorporated, 1585
Broadway, 2nd Floor, New York, New York
10036, Attention: Medium-Term Note Trading
Desk, Carlos Cabrera, telephone: (212)
761-4000, telecopier: (212) 761-0780;
if to Salomon Smith Barney Inc., to: Salomon
Smith Barney Inc., Brooklyn Army Terminal,
140 58th Street, 5th Floor, Brooklyn, NY,
11220, Attention: Diane Graham, telephone:
(718) 765-6736, telecopier: (718) 765-6734;
if to any other Agent or to the Trustee, to
such address or telecopier number as shall be
furnished by such Agent or the Trustee to the
Company.
For record keeping purposes, one copy of such
Pricing Supplement shall also be mailed or
telecopied to Merrill
6
Lynch & Co., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, World Financial Center,
North Tower, 15th Floor, New York, New York,
10281-1315, Attention: MTN Product Management,
(212) 449-7476, telecopier: (212) 449-2234.
In each instance that a Pricing Supplement is
prepared, the Offering Agent will provide a
copy of such Pricing Supplement to each
investor or purchaser of the relevant Notes
or its agent. Pursuant to Rule 434 ("Rule
434") of the Securities Act of 1933, as
amended, the Pricing Supplement may be
delivered separately from the Prospectus.
Outdated Pricing Supplements (other than
those retained for files) will be destroyed.
Settlement: The receipt of immediately available funds by
the Company in payment for a Note and the
authentication and delivery of such Note shall,
with respect to such Note, constitute
"settlement". Offers accepted by the Company
will be settled in three Business Days, or at
such time as the purchaser, the applicable
Agent and the Company shall agree, pursuant to
the timetable for settlement set forth in Parts
II and III hereof under "Settlement Procedure
Timetable" with respect to Global Notes and
Certificated Notes, respectively (each such
date fixed for settlement is hereinafter
referred to as a "Settlement Date"). If
procedures A and B of the applicable Settlement
Procedures with respect to a particular offer
are not completed on or before the time set
forth under the applicable "Settlement
Procedures Timetable", then, unless otherwise
agreed by the relevant parties, such offer
shall not be settled until the Business Day
following the completion of settlement
procedures A and B or such later date as the
purchaser and the Company shall agree.
The foregoing settlement procedures may be
modified with respect to any purchase of Notes
by an Agent as principal if so agreed by the
Company and such Agent.
Procedure for Changing
Rates or Other
Variable Terms: When a decision has been reached to change the
interest rate or any other variable term on any
Notes being sold by the Company, the Company
will promptly advise the Agents and the Trustee
by facsimile transmission and the Agents will
forthwith suspend solicitation of offers to
purchase such Notes. The Agents will telephone
the Company with
7
recommendations as to the changed interest rate
or other variable terms. At such time as the
Company notifies the Agents and the Trustee of
the new interest rates or other variable terms,
the Agents may resume solicitation of offers to
purchase such Notes. Until such time, only
"indications of interest" may be recorded.
Immediately after acceptance by the Company of
an offer to purchase Notes at a new interest
rate or new variable term, the Company, the
Offering Agent and the Trustee shall follow the
procedures set forth under the applicable
"Settlement Procedures".
Suspension of
Solicitation;
Amendment or
Supplement: The Company may instruct the Agents to suspend
solicitation of offers to purchase Notes at any
time. Upon receipt of such instructions, the
Agents will forthwith suspend solicitation of
offers to purchase from the Company until such
time as the Company has advised the Agents that
solicitation of offers to purchase may be
resumed. If the Company decides to amend or
supplement the Registration Statement or the
Prospectus (other than to establish or change
interest rates or formulas, maturities, prices
or other similar variable terms with respect to
the Notes), it will promptly advise the Agents
and will furnish the Agents and their counsel
with copies of the proposed amendment or
supplement. Copies of such amendment or
supplement will be delivered or mailed to the
Agents, their counsel and the Trustee in
quantities which such parties may reasonably
request at the following respective addresses:
Goldman, Sachs & Co., 85 Broad St., New York,
NY 10004, Attention: Money Market Origination/
Ben Smilchensky, telephone: (212) 902-1000,
telecopier: (212) 902-3000;
Merrill Lynch & Co., World Financial Center,
North Tower, 15th Floor, New York, New York
10281-1315, Attention: MTN Product Management,
telephone: (212) 449-7476, telecopier: (212)
449-2234;
Morgan Stanley & Co. Incorporated, 1585
Broadway, 2nd Floor, New York, New York 10036,
Attention: Medium-Term Note Trading Desk,
Carlos Cabrera, telephone: (212) 761-4000
telecopier: (212) 761-0780;
8
Salomon Smith Barney Inc., Brooklyn Army
Terminal, 140 58th Street, 5th Floor, Brooklyn,
NY, 11220, Attention: Diane Graham,
telephone: (718) 765-6736, telecopier: (718)
765-6734; and
if to any other Agent or to the Trustee, to
such address or telecopier number as shall be
furnished by such Agent or the Trustee to the
Company.
In the event that at the time the solicitation
of offers to purchase from the Company is
suspended (other than to establish or change
interest rates or formulas, maturities, prices
or other similar variable terms with respect to
the Notes) there shall be any offers to
purchase Notes that have been accepted by the
Company which have not been settled, the
Company will promptly advise the Offering Agent
and the Trustee whether such offers may be
settled and whether copies of the Prospectus as
theretofore amended and/or supplemented as in
effect at the time of the suspension may be
delivered in connection with the settlement of
such offers. The Company will have the sole
responsibility for such decision and for any
arrangements which may be made in the event
that the Company determines that such offers
may not be settled or that copies of such
Prospectus may not be so delivered.
Delivery of Prospectus
and applicable
Pricing Supplement: A copy of the most recent Prospectus and the
applicable Pricing Supplement, which pursuant
to Rule 434 may be delivered separately from
the Prospectus, must accompany or precede the
earlier of (a) the written confirmation of a
sale sent to an investor or other purchaser or
its agent and (b) the delivery of Notes to an
investor or other purchaser or its agent.
9
Authenticity of
Signatures: The Agents will have no obligation or liability
to the Company or the Trustee in respect of the
authenticity of the signature of any officer,
employee or agent of the Company or the Trustee
on any Note.
Documents Incorporated
by Reference: The Company shall supply the Agents with an adequate
supply of all documents incorporated by reference in
the Registration Statement and the Prospectus.
PART XIX: PROCEDURES FOR NOTES ISSUED
IN BOOK-ENTRY FORM
In connection with the qualification of Notes issued in book-entry
form 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 Issuing Agent and Paying Agent to DTC,
dated July 19, 1999 and a Certificate Agreement, dated July 15, 1999, between
the Paying Agent and DTC, as amended (the "Certificate Agreement"), and its
obligations as a participant in DTC, including DTC's Same-Day Funds Settlement
System ("SDFS").
Issuance: All Fixed Rate Notes issued in book-entry form
having the same Original Issue Date, Specified
Currency, Interest Rate, Default Rate, Interest
Payment Dates, redemption and/or repayment terms,
if any, and Stated Maturity Date (collectively,
the "Fixed Rate Terms") will be represented
initially by a single Global Note for each
$200,000,000 principal amount or portion thereof;
and all Floating Rate Notes issued in book-entry
form having the same Original Issue Date,
Specified Currency, Interest Category, formula for
the calculation of interest (including the
Interest Rate Basis or Bases, which may be the CD
Rate, the CMT Rate, the Commercial Paper Rate, the
Eleventh District Cost of Funds Rate, the Federal
Funds Rate, LIBOR, the Prime Rate or the Treasury
Rate or any other interest rate basis or formula,
and Spread and/or Spread Multiplier, if any), Day
Count Convention, Initial Interest Rate, Default
Rate, Index Maturity (if applicable), Minimum
Interest Rate, if any, Maximum Interest Rate, if
any, redemption and/or repayment terms, if any,
Interest Payment Dates, Initial Interest Reset
Date, Interest Reset Dates and Stated Maturity
Date (collectively, the "Floating Rate Terms")
will be represented initially by a single Global
Note for each $200,000,000 principal amount or
portion thereof.
10
For other variable terms with respect to the Fixed
Rate Notes and Floating Rate Notes, see the
Prospectus and the applicable Pricing Supplement.
Owners of beneficial interests in Global Notes
will be entitled to physical delivery of
Certificated Notes equal in principal amount to
their respective beneficial interests only upon
certain limited circumstances described in the
Prospectus.
Identification: The Company has arranged with the CUSIP Service
Bureau of Standard & Poor's Corporation (the
"CUSIP Service Bureau") for the reservation of one
series of CUSIP numbers, which series consists of
approximately 900 CUSIP numbers which have been
reserved for and relating to Global Notes and the
Company has delivered to each of the Trustee and
DTC such list of such CUSIP numbers. The Company
will assign CUSIP numbers to Global Notes as
described below under Settlement Procedure B. DTC
will notify the CUSIP Service Bureau periodically
of the CUSIP numbers that the Company has assigned
to Global Notes. The Trustee will notify the
Company at any time when fewer than 100 of the
reserved CUSIP numbers remain unassigned to Global
Notes, and, if it deems necessary, the Company
will reserve and obtain additional CUSIP numbers
for assignment to Global Notes. Upon obtaining
such additional CUSIP numbers, the Company will
deliver a list of such additional numbers to the
Trustee and DTC. Notes issued in book-entry form
in excess of $200,000,000 (or the equivalent
thereof in one or more foreign or composite
currencies) aggregate principal amount and
otherwise required to be represented by the same
Global Note will instead be represented by two or
more Global Notes which shall all be assigned the
same CUSIP number.
Registration: Unless otherwise specified by DTC, each Global
Note will be registered in the name of Cede & Co.,
as nominee for DTC, on the register maintained by
the Trustee under the Indenture. The beneficial
owner of a Note issued in book-entry form (I.E.,
an owner of a beneficial interest in a Global
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 issued in book-entry form, the
"Participants") to act as agent for such
beneficial 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
11
Participants, a credit balance with respect to such
Note issued in book-entry form in the account of
such Participants. The ownership interest of such
beneficial owner in such Note issued in book-entry
form 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 beneficial ownership interests in a
Global 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 Global Note.
Exchanges: The Trustee may deliver to DTC and the CUSIP
Service Bureau at any time a written notice
specifying (a) the CUSIP numbers of two or more
Global Notes outstanding on such date that
represent Global Notes having the same Fixed Rate
Terms or Floating Rate Terms, as the case may be
(other than Original Issue Dates), and for which
interest has been paid to the same date; (b) a
date, occurring at least 30 days after such
written notice is delivered and at least 30 days
before the next Interest Payment Date for the
related Notes issued in book-entry form, on which
such Global Notes shall be exchanged for a single
replacement Global Note; and (c) a new CUSIP
number, obtained from the Company, to be assigned
to such replacement Global Note. 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 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 Notes to be exchanged will no longer
be valid. On the specified exchange date, the
Trustee will exchange such Global Notes for a
single Global Note bearing the new CUSIP number
and the CUSIP numbers of the exchanged Notes will,
in accordance with CUSIP Service Bureau
procedures, be canceled and not immediately
reassigned. Notwithstanding the foregoing, if the
Global Notes to be exchanged exceed $200,000,000
(or the equivalent thereof in one or more foreign
or composite currencies) in aggregate principal
amount, one replacement Note will be authenticated
and issued to represent each $200,000,000 (or the
equivalent thereof in one or more foreign or
composite currencies) in aggregate principal
amount of the exchanged
12
Global Notes and an additional Global Note or Notes
will be authenticated and issued to represent any
remaining principal amount of such Global Notes
(See "Denominations" below).
Denominations: Unless otherwise provided in the applicable
Pricing Supplement, Notes issued in book-entry
form will be issued in denominations of $1,000 and
integral multiples thereof. Global Notes will not
be denominated in excess of $200,000,000 (or the
equivalent thereof in one or more foreign or
composite currencies) aggregate principal amount.
If one or more Notes are issued in book-entry form
in excess of $200,000,000 (or the equivalent
thereof in one or more foreign or composite
currencies) aggregate principal amount and would,
but for the preceding sentence, be represented by
a single Global Note, then one Global Note will be
issued to represent each $200,000,000 (or the
equivalent thereof in one or more foreign or
composite currencies) in aggregate principal
amount of such Notes issued in book-entry form and
an additional Global Note or Notes will be issued
to represent any remaining aggregate principal
amount of such Note or Notes issued in book-entry
form. In such a case, each of the Global Notes
representing Notes issued in book-entry form shall
be assigned the same CUSIP number.
Payments of Principal
and Interest: PAYMENTS OF INTEREST ONLY. Promptly after each
Regular Record Date, the Trustee will deliver to
the Company and DTC a written notice specifying by
CUSIP number the amount of interest to be paid on
each Global Note on the following Interest Payment
Date (other than an Interest Payment Date
coinciding with the Maturity Date) and the total
of such amounts. DTC will confirm the amount
payable on each Global Note on such Interest
Payment Date by reference to the daily bond
reports published by Standard & Poor's
Corporation. On such Interest Payment Date, the
Company will pay to the Trustee in immediately
available funds an amount sufficient to pay the
interest then due and owing on the Global Notes,
and upon receipt of such funds from the Company,
the Trustee in turn will pay to DTC such total
amount of interest due on such Global Notes (other
than on the Maturity Date) which is payable in
U.S. dollars, at the times and in the manner set
forth below under "Manner of Payment". The
Trustee shall make payment of that amount of
interest due and owing on any Global Notes
13
that Participants have elected to receive in
foreign or composite currencies directly to such
Participants.
NOTICE OF INTEREST RATES. Promptly after each
Interest Determination Date or Calculation Date,
as the case may be, for Floating Rate Notes issued
in book-entry form, the Trustee will notify each
of Moody's Investors Service, Inc. and Standard &
Poor's Ratings Service of the interest rates
determined as of such Interest Determination Date.
PAYMENTS AT MATURITY. On or about the first
Business Day of each month, the Trustee will
deliver to the Company and DTC a written list of
principal, premium, if any, and interest to be
paid on each Global Note maturing or otherwise
becoming due in the following month. The Trustee,
the Company and DTC will confirm the amounts of
such principal, premium, if any, and interest
payments with respect to each such Global Note on
or about the fifth Business Day preceding the
Maturity Date of such Global Note. On the
Maturity Date, the Company will pay to the Trustee
in immediately available funds an amount
sufficient to make the required payments, and upon
receipt of such funds the Trustee in turn will pay
to DTC the principal amount of Global Notes,
together with premium, if any, and interest due on
the Maturity Date, which are payable in U.S.
dollars, at the times and in the manner set forth
below under "Manner of Payment". The Trustee
shall make payment of the principal, premium, if
any, and interest to be paid on the Maturity Date
of each Global Note that Participants have elected
to receive in foreign or composite currencies
directly to such Participants. Promptly after (i)
payment to DTC of the principal, premium, if any,
and interest due on the Maturity Date of such
Global Note which are payable in U.S. dollars and
(ii) payment of the principal, premium, if any,
and interest due on the Maturity Date of such
Global Note to those Participants who have elected
to receive such payments in foreign or composite
currencies, the Trustee will cancel such Global
Note and deliver it to the Company with an
appropriate debit advice. On the first Business
Day of each month, the Trustee will deliver to the
Company a written statement indicating the total
principal amount of outstanding Global Notes as of
the close of business on the immediately preceding
Business Day.
MANNER OF PAYMENT. The total amount of any
principal, premium, if any, and interest due on
Global Notes on any Interest Payment Date or the
Maturity Date, as the case
14
may be, which is payable in U.S. dollars shall be
paid by the Company to the Trustee in funds
available for use by the Trustee no later than
10:00 a.m., New York City time, on such date. The
Company will make such payment on such Global Notes
to an account specified by the Trustee. Upon
receipt of such funds, 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 in
U.S. dollars of principal, premium, if any, and
interest due on Global Notes on such date.
Thereafter on 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 beneficial interests in such Global
Notes 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 in U.S. dollars by DTC of the
principal of, or premium, if any, or interest
on, the Global Notes. The Trustee shall make all
payments of principal, premium, if any, and
interest on each Global Note that Participants have
elected to receive in foreign or composite
currencies directly to such Participants.
WITHHOLDING TAXES. The amount of any taxes
required under applicable law to be withheld from
any interest payment on a Global Note will be
determined and withheld by the Participant,
indirect participant in DTC or other Person
responsible for forwarding payments and materials
directly to the beneficial owner of such Global
Note.
Settlement
Procedures: Settlement Procedures with regard to each Note in
book-entry form sold by an Agent, as agent of the
Company, or purchased by an Agent, as principal,
will be as follows:
B. The Offering Agent will advise the Company by
telephone, confirmed by facsimile, of the
following settlement information:
1. Principal amount, Authorized Denomination,
and Specified Currency.
2. Exchange Rate Agent, if any.
3. (a) Fixed Rate Notes:
15
(i) Interest Rate.
(ii) Interest Payment Dates.
(iii) Whether such Note is being
issued with Original Issue
Discount and, if so, the terms
thereof.
(b) Floating Rate Notes:
(i) Interest Category.
(ii) Interest Rate Basis or Bases.
(iii) Initial Interest Rate.
(iv) Spread and/or Spread Multiplier, if
any.
(v) Initial Interest Reset Date or
Interest Reset Dates.
(vi) Interest Payment Dates.
(vii) Index Maturity, if any.
(viii) Maximum and/or Minimum Interest
Rates, if any.
(ix) Day Count Convention.
(x) Calculation Agent.
4. Price to public, if any, of such Note (or
whether such Note is being offered at varying
prices relating to prevailing market prices
at time of resale as determined by the
Offering Agent).
5. Trade Date.
6. Settlement Date (Original Issue Date).
7. Stated Maturity Date.
8. Redemption provisions, if any.
9. Repayment provisions, if any.
16
10. Default Rate, if any.
11. Net proceeds to the Company.
12. The Offering Agent's discount or commission.
13. Whether such Note is being sold to the
Offering Agent as principal or to an
investor or other purchaser through the
Offering Agent acting as agent for the
Company.
14. Such other information specified with
respect to such Note (whether by Addendum or
otherwise).
C. The Company will assign a CUSIP number to the
Global Note representing such Note and then
advise the Trustee by facsimile transmission or
other electronic transmission of the above
settlement information received from the
Offering Agent, such CUSIP number and the name
of the Offering Agent. The Company will also
advise the Offering Agent of the CUSIP number
assigned to the Global Note.
D. The Trustee will communicate to DTC and the
Offering Agent through DTC's Participant
Terminal System a pending deposit message
specifying the following settlement
information:
1. The information set forth in the Settlement
Procedure A.
2. Identification numbers of the participant
accounts maintained by DTC on behalf of the
Trustee and the Offering Agent.
3. Identification of the Global Note as a Fixed
Rate Global Note or Floating Rate Global
Note.
4. Initial Interest Payment Date for such Note,
number of days by which such date succeeds
the related record date for DTC purposes
(or, in the case of Floating Rate Notes
which reset daily or weekly, the date five
calendar days preceding the Interest
Payment Date) and, if then calculable, the
amount of interest payable on such Interest
Payment Date (which amount shall have been
confirmed by the Trustee).
5. CUSIP number of the Global Note representing
such Note.
17
6. Whether such Global Note represents any
other Notes issued or to be issued in
book-entry form.
DTC will arrange for each pending deposit
message described above to be transmitted to
Standard & Poor's Corporation, which will use
the information in the message to include
certain terms of the related Global Note in the
appropriate daily bond report published by
Standard & Poor's Corporation.
E. The Trustee will complete and authenticate the
Global Note representing such Note.
F. DTC will credit such Note to the participant
account of the Trustee maintained by DTC.
G. The Trustee will enter an SDFS deliver order
through DTC's Participant Terminal System
instructing DTC (i) to debit such Note to the
Trustee's participant account and credit such
Note to the participant account of the Offering
Agent maintained by DTC and (ii) to debit the
settlement account of the Offering Agent and
credit the settlement account of the Trustee
maintained by DTC, in an amount equal to the
price of such Note less such Offering Agent's
discount or underwriting commission, as
applicable. Any entry of such a deliver order
shall be deemed to constitute a representation
and warranty by the Trustee to DTC that (i) the
Global Note representing such Note has been
issued and authenticated and (ii) the Trustee
is holding such Global Note pursuant to the
Certificate Agreement.
H. In the case of Notes in book-entry form sold
through the Offering Agent, as agent, the
Offering Agent will enter an SDFS deliver order
through DTC's Participant Terminal System
instructing DTC (i) to debit such Note to the
Offering Agent's participant account and credit
such Note to the participant account of the
Participants maintained by DTC and (ii) to
debit the settlement accounts of such
Participants and credit the settlement account
of the Offering Agent maintained by DTC in an
amount equal to the initial public offering
price of such Note.
I. 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.
18
J. Upon receipt, the Trustee will pay the Company,
by wire transfer of immediately available funds
to an account specified by the Company to the
Trustee from time to time, the amount
transferred to the Trustee in accordance with
Settlement Procedure F.
K. The Trustee will send a copy of the Global Note
by first class mail to the Company together
with a statement setting forth the principal
amount of Notes Outstanding as of the related
Settlement Date after giving effect to such
transaction and all other offers to purchase
Notes of which the Company has advised the
Trustee but which have not yet been settled.
L. If such Note was sold through the Offering
Agent, as agent, the Offering Agent will
confirm the purchase of such Note to the
investor or other purchaser either by
transmitting to the Participant with respect to
such Note a confirmation order through DTC's
Participant Terminal System or by mailing a
written confirmation to such investor or other
purchaser.
Settlement Procedures
Timetable: For offers to purchase Notes accepted by the
Company, Settlement Procedures A through K set
forth above shall be completed as soon as
possible following the trade but not later than
the respective times (New York City time) set
forth below:
SETTLEMENT
PROCEDURE TIME
A 11:00 a.m. on the trade date
or within one hour following
the trade
B 12:00 noon on the trade date
or within one hour following
the trade
C No later than the close of
business on the trade date
D 9:00 a.m. on Settlement Date
E 10:00 a.m. on Settlement Date
F-G No later than 2:00 p.m. on
Settlement Date
H 4:00 p.m. on Settlement Date
I-K 5:00 p.m. on Settlement Date
Settlement Procedure H 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.
19
If settlement of a Note issued in book-entry
form is rescheduled or canceled, the Trustee
will deliver to DTC, through DTC's Participant
Terminal System, a cancellation message to such
effect by no later than 5:00 p.m., New York
City time, on the Business Day immediately
preceding the scheduled Settlement Date.
Failure to Settle: If the Trustee fails to enter an SDFS deliver
order with respect to a Note issued in book-entry
form 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 participant account of
the Trustee maintained at DTC. DTC will process
the withdrawal message, provided that such
participant account contains a principal amount of
the Global Note representing such Note that is at
least equal to the principal amount to be
debited. If withdrawal messages are processed
with respect to all the Notes represented by a
Global Note, the Trustee will mark such Global
Note "canceled", make appropriate entries in its
records and send certification of destruction of
such canceled Global Note to the Company. The
CUSIP number assigned to such Global Note shall,
in accordance with CUSIP Service Bureau
procedures, be canceled and not immediately
reassigned. If withdrawal messages are processed
with respect to a portion of the Notes represented
by a Global Note, the Trustee will exchange such
Global Note for two Global Notes, one of which
shall represent the Global Notes for which
withdrawal messages are processed and shall be
canceled immediately after issuance and the other
of which shall represent the other Notes
previously represented by the surrendered Global
Note and shall bear the CUSIP number of the
surrendered Global Note.
In the case of any Note in book-entry form sold
through the Offering Agent, as agent, if the
purchase price for any such Note is not timely
paid to the Participants with respect thereto by
the beneficial investor or other purchaser thereof
(or a person, including an indirect participant in
DTC, acting on behalf of such investor or other
purchaser), such Participants and, in turn, the
related Offering 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. If such
failure shall have occurred for any reason other
than default by the applicable Offering Agent to
perform its obligations hereunder or under the
Distribution
20
Agreement, the Company will reimburse such Offering
Agent on an equitable basis for its reasonable loss
of the use of funds during the period when the
funds were credited to the account of the Company.
Notwithstanding the foregoing, upon any failure to
settle with respect to a Note in book-entry form,
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 a
Note that was to have been represented by a Global
Note also representing other Notes, the Trustee
will provide, in accordance with Settlement
Procedure D, for the authentication and issuance
of a Global Note representing such remaining Notes
and will make appropriate entries in its records.
PART III: PROCEDURES FOR CERTIFICATED NOTES
Denominations: Unless otherwise provided in the applicable
Pricing Supplement, the Certificated Notes will be
issued in denominations of $1,000 and integral
multiples thereof.
Payments of Principal,
Premium, if any,
and Interest: Upon presentment and delivery of the Certificated
Note, the Trustee upon receipt of immediately
available funds from the Company will pay the
principal of, premium, if any, and interest on,
each Certificated Note on the Maturity Date in
immediately available funds. All interest
payments on a Certificated Note, other than
interest due on the Maturity Date, will be made by
check mailed to the address of the person entitled
thereto as such address shall appear in the
Security Register; PROVIDED, HOWEVER, that Holders
of $10,000,000 or more in aggregate principal
amount of Certificated Notes (whether having
identical or different terms and provisions) shall
be entitled to receive such interest payments by
wire transfer of immediately available funds if
appropriate wire transfer instructions have been
received in writing by the Trustee not less than
15 calendar days prior to the applicable Interest
Payment Date.
The Trustee will provide monthly to the Company a
list of the principal, premium, if any, and
interest to be paid on Certificated Notes maturing
in the next succeeding month. The Trustee will be
responsible for withholding taxes on interest paid
as required by applicable law.
21
Certificated Notes presented to the Trustee on the
Maturity Date for payment will be canceled by the
Trustee. All canceled Certificated Notes held by
the Trustee shall be destroyed, and the Trustee
shall furnish to the Company a certificate with
respect to such destruction.
Settlement
Procedures: Settlement Procedures with regard to each
Certificated Note purchased by an Agent, as
principal, or through an Agent, as agent, shall be
as follows:
A. The Offering Agent will advise the Company by
telephone of the following Settlement
information with regard to each Certificated
Note:
1. Exact name in which the Certificated Note(s)
is to be registered (the "Registered
Owner").
2. Exact address or addresses of the Registered
Owner for delivery, notices and payments of
principal, premium, if any, and interest.
3. Taxpayer identification number of the
Registered Owner.
4. Principal amount, Authorized Denomination
and Specified Currency.
5. Exchange Rate Agent, if any.
6. (a) Fixed Rate Notes:
(i) Interest Rate.
(ii) Interest Payment Dates.
(iii) Whether such Note is being issued
with Original Issue Discount and,
if so, the terms thereof.
(b) Floating Rate Notes:
(i) Interest Category.
(ii) Interest Rate Basis or Bases.
(iii) Initial Interest Rate.
22
(iv) Spread and/or Spread Multiplier,
if any.
(v) Initial Interest Reset Date and
Interest Reset Dates.
(vi) Interest Payment Dates.
(vii) Index Maturity, if any.
(viii) Maximum and/or Minimum Interest
Rates, if any.
(ix) Day Count Convention.
(x) Calculation Agent.
7. Price to public of such Certificated Note
(or whether such Note is being offered at
varying prices relating to prevailing market
prices at time of resale as determined by
the Offering Agent).
8. Trade Date.
9. Settlement Date (Original Issue Date).
10. Stated Maturity Date.
11. Redemption provisions, if any.
12. Repayment provisions, if any.
13. Default Rate, if any.
14. Net proceeds to the Company.
15. The Offering Agent's discount or commission.
16. Whether such Note is being sold to the
Offering Agent as principal or to an
investor or other purchaser through the
Offering Agent acting as agent for the
Company.
17. Such other information specified with
respect to such Note (whether by Addendum
or otherwise).
23
N. After receiving such settlement information
from the Offering Agent, the Company will
advise the Trustee of the above settlement
information by facsimile transmission confirmed
by telephone. The Company will cause the
Trustee to issue, authenticate and deliver the
Certificated Note.
O. The Trustee will complete the Certificated Note
in the form approved by the Company and the
Offering Agent, and will make three copies
thereof (herein called "Stub 1", "Stub 2" and
"Stub 3"):
1. Certificated Note with the Offering Agent's
confirmation, if traded on a principal
basis, or the Offering Agent's customer
confirmation, if traded on an agency basis.
2. Stub 1 for Trustee.
3. Stub 2 for Offering Agent.
4. Stub 3 for the Company.
P. With respect to each trade, the Trustee will
deliver the Certificated Note and Stub 2
thereof to the Offering Agent at the following
applicable address:
Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Merrill Lynch Money Markets
Clearance, 55 Water Street, Concourse
Level, N.S.C.C. Window, New York, New York
10041, Attention: Al Mitchell, (212) 855-2403,
telecopier: (212) 855-2457;
Bank of New York, Dealer Clearance Department,
1 Wall Street, 3rd Floor, Window 3B, New York,
New York 10005, Attention: For the Account of
Morgan Stanley & Co. Incorporated;
New York Window, The Depository Trust Company,
Mezzanine Level, 3rd Floor, For the Account of
Salomon Smith Barney, 55 Water Street, New
York, New York, 10001;
if to any other Agent, to such address or
telecopier number as shall be furnished by such
Agent or the Trustee to the Company.
24
The Trustee will keep Stub 1. The Offering
Agent will acknowledge receipt of the
Certificated Note through a broker's receipt
and will keep Stub 2. Delivery of the
Certificated Note will be made only against
such acknowledgment of receipt. Upon
determination that the Certificated Note
has been authorized, delivered and completed as
aforementioned, the Offering Agent will wire
the net proceeds of the Certificated Note after
deduction of its applicable commission to the
Company pursuant to standard wire instructions
given by the Company.
Q. In the case of a Certificated Note sold through
the Offering Agent, as agent, the Offering
Agent will deliver such Certificated Note (with
the confirmation) to the purchaser against
payment in immediately available funds.
R. The Trustee will send Stub 3 to the Company.
Settlement
Procedures
Timetable: For offers to purchase Certificated Notes accepted
by the Company, Settlement Procedures A through F
set forth above shall be completed as soon as
possible following the trade but not later than
the respective times (New York City time) set
forth below:
SETTLEMENT
PROCEDURE TIME
A 11:00 a.m. on the trade date
or within one hour following
the trade
B 12:00 noon on the trade date
or within one hour following
the trade
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
Failure to Settle: In the case of Certificated Notes sold through the
Offering Agent, as agent, if an investor or other
purchaser of a Certificated Note from the Company
shall either fail to accept delivery of or make
payment for such Certificated Note on the date
fixed for settlement, the Offering Agent will
forthwith notify the Trustee and the Company by
telephone, confirmed in writing, and return such
Certificated Note to the Trustee.
The Trustee, upon receipt of such Certificated
Note from the Offering Agent, will immediately
advise the Company and the
25
Company will promptly arrange to credit the account
of the Offering Agent in an amount of immediately
available funds equal to the amount previously paid
to the Company by such Offering Agent in settlement
for such Certificated Note. Such credits will be
made on the Settlement Date if possible, and in any
event not later than the Business Day following the
Settlement Date; provided that the Company has
received notice on the same day. If such failure
shall have occurred for any reason other than
failure by such Offering Agent to perform its
obligations hereunder or under the Distribution
Agreement, the Company will reimburse such
Offering Agent on an equitable basis for its
reasonable loss of the use of funds during the
period when the funds were credited to the account
of the Company. Immediately upon receipt of the
Certificated Note in respect of which the failure
occurred, the Trustee will cancel and destroy such
Certificated Note, make appropriate entries in its
records to reflect the fact that such Certificated
Note was never issued, and accordingly notify in
writing the Company.