1
Exhibit 1.01
Citigroup Inc.
Medium-Term Senior Notes, Series E
Medium-Term Subordinated Notes, Series E
Due Nine Months or More from the Date of Issue
DISTRIBUTION AGREEMENT
April 23, 2001
Salomon Smith Barney Inc.
388 Greenwich Street
New York, New York 10013
Ladies and Gentlemen:
Citigroup Inc., a Delaware corporation (the "Company"), confirms its
agreement with the Agent (as defined below) with respect to the issue and sale
by the Company of its Medium-Term Senior Notes, Series E, Due Nine Months or
More from the Date of Issue (the "Senior Notes") and its Medium-Term
Subordinated Notes, Series E, Due Nine Months or More from the Date of Issue
(the "Subordinated Notes" and, together with the Senior Notes, the "Notes"). The
Senior Notes are to be issued under an Indenture dated as of March 15, 1987, as
supplemented by the First Supplemental Indenture dated as of December 15, 1988,
the Second Supplemental Indenture dated as of January 31, 1991, the Third
Supplemental Indenture dated as of December 9, 1992 and the Fourth Supplemental
Indenture dated as of November 2, 1998 (as so supplemented or as it may from
time to time be further supplemented or amended by one or more indentures
supplemental thereto, the "Senior Debt Indenture"), between the Company and The
Bank of New York, as trustee (the "Senior Debt Trustee"). The Subordinated Notes
are to be issued under an Indenture dated as of April 12, 2001 (as it may from
time to time be supplemented or amended by one or more indentures supplemental
thereto, the "Subordinated Debt Indenture" and, together with the Senior Debt
Indenture, the "Indentures"), between the Company and Bank One Trust Company,
N.A., as trustee (the "Subordinated Debt Trustee" and, together with the Senior
Debt Trustee, the "Trustees"). The Notes will have the maturities, interest
rates (whether fixed or floating), redemption provisions and
2
other terms set forth in pricing supplements to the Prospectus referred to
below. The Notes may be denominated in U.S. dollars, foreign currencies or
foreign composite currency units (the "Specified Currency") as may be specified
in the applicable pricing supplement.
Subject to the terms and conditions stated herein and subject to the
reservation by the Company of the right to sell Notes to the Agent acting as
principal at a discount for its own account or for resale to one or more
investors or other dealers and the Company's right to sell Notes directly to
investors on its own behalf or through other agents (provided that any other
agent will execute an agreement with the Company substantially in the form of
Exhibit F hereto and that the Company will notify the Agent of its agreement
with any other agents, dealers or underwriters, but only if such other agents,
dealers or underwriters are appointed for the duration of this Agreement), the
Company hereby appoints the Agent as an agent of the Company for the purpose of
soliciting offers to purchase the Notes. In addition, the Agent may also
purchase Notes as principal and the Company will enter into a Terms Agreement
(referred to below) relating to such sale in accordance with the provisions of
Section l(b) hereof. For the purposes of this Agreement, the term "Agent" shall
refer to Salomon Smith Barney Inc.
1. Solicitations by the Agent of Offers to Purchase; Purchases as
Principal.
(a) Solicitations as Agent. Following the Commencement Date (as
defined below), the Company shall notify the Agent from time to time as to the
commencement of a period during which the Notes may be offered and sold by the
Agent (each period, commencing with such a notification and ending at such time
as the authorization for offers and sales through the Agent shall have been
suspended by the Company or the Agent as provided hereunder, being herein
referred to as an "Offering Period"). On the basis of the representations and
warranties herein contained, but subject to the terms and conditions herein set
forth, the Agent agrees to use its reasonable best efforts to solicit offers to
purchase the Notes during each Offering Period upon the terms and conditions set
forth in the Prospectus as then amended and supplemented. The Company reserves
the right, in its sole discretion, to suspend solicitation of purchases of the
Notes commencing at any time for any period of time or permanently. Upon receipt
of instructions from the Company, the Agent will forthwith suspend solicitation
of purchases from the Company until such time as the Company has advised the
Agent that such solicitation may be resumed.
Unless otherwise agreed to, the Company agrees to pay the Agent
at the time of delivery of and payment for the Notes, as consideration for
soliciting the sale of each Note, a commission equal to the percentage set forth
on Schedule 1 hereto of the
2
3
price to the public of each Note sold by the Company as the result of a
solicitation by the Agent. Without the prior approval of the Company, the Agent
(acting on an agency basis) may not reallow any portion of the commission
payable pursuant hereto to dealers or purchasers in connection with the offer
and sale of any Notes.
The Agent is authorized to solicit orders for the Notes only in
principal amounts of $1,000 or any amount in excess thereof which is a multiple
of $1,000 or, in the case of Notes denominated in a Specified Currency other
than U.S. dollars, in the denominations set forth in the applicable pricing
supplement, at a purchase price equal to 100% of the principal amount of the
Notes, unless otherwise mutually agreed upon by the purchaser and the Company
and specified in the applicable pricing supplement. The Agent shall communicate
to the Company, orally or in writing, each reasonable offer or indication of
interest to purchase Notes received by the Agent, as agent. The Company shall
have the sole right to accept offers to purchase the Notes and may reject any
such offer in whole or in part. The Agent shall have the right to reject, in its
discretion reasonably exercised, any offer received by it to purchase the Notes,
in whole or in part, and any such rejection shall not be deemed a breach of its
agreements contained herein. In soliciting offers to purchase the Notes in its
capacity as agent of the Company, the Agent is acting solely as agent for the
Company, and not as principal, and does not assume any obligation toward, or
relationship of agency or trust with, any purchaser of the Notes (other than any
such obligation or relationship which the Agent assumes independently of this
Agreement). The Agent shall make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer to purchase Notes has been
solicited by the Agent and accepted by the Company, but the Agent shall not have
any liability to the Company in the event any such purchase is not consummated
for any reason. Under no circumstances will the Agent be obligated to purchase
any Notes for its own account except pursuant to subparagraph (b) below.
(b) Purchases as Principal. Each sale of Notes to the Agent as
principal shall be made in accordance with the terms of this Agreement and the
Agent and the Company will enter into a Terms Agreement that will provide for
the sale of such Notes to and the purchase thereof by the Agent. Each "Terms
Agreement" may take the form of an exchange of any form of written
telecommunication or oral communication followed by written confirmation or
telecommunication between the Agent and the Company and shall be with respect to
such information (as applicable) as is specified in Exhibit A hereto.
The 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. Each
3
4
agreement by the Agent to purchase Notes as principal (whether or not set forth
in a Terms Agreement) shall specify the principal amount of Notes to be
purchased by the Agent pursuant thereto, the maturity date of such Notes, the
price to be paid to the Company for such Notes, the interest rate and interest
rate formula, if any, applicable to such Notes and any other terms of such
Notes. Each such agreement shall also specify any requirements for officers'
certificates, opinions of counsel and letters from the independent public
accountants of the Company pursuant to Section 4 hereof. A Terms Agreement may
also specify certain provisions relating to the reoffering of such Notes by the
Agent.
Each Terms Agreement shall specify the time and place of delivery
of and payment for such Notes. Each date of delivery of and payment for Notes to
be purchased by the Agent as principal or as agent or by any other purchaser is
referred to herein as a "Settlement Date."
Upon the Company's request, the Agent will notify the Company
either orally or in writing (as specified by the Company) of the aggregate
principal amount of Notes held by the Agent as principal purchased pursuant to a
Terms Agreement pursuant to this Agreement.
(c) Procedures. The Agent and the Company agree to perform the
respective duties and obligations specifically provided to be performed by them
in the Medium-Term Notes Administrative Procedures attached hereto as Exhibit B
(the "Procedures"). The Procedures may be amended only by written agreement of
the Company and the Agent.
(d) Delivery. The documents required to be delivered by Section 4
of this Agreement shall be delivered at the office of Skadden, Arps, Slate
Meagher & Flom LLP ("Skadden, Arps") (or such other counsel reasonably
satisfactory to both the Agent and the Company), Four Times Square, New York, NY
10036-6522, on April 23, 2001 (the "Commencement Date").
2. Representations and Warranties. The Company represents and warrants
to, and agrees with, the Agent as of the Commencement Date:
(a) A registration statement on Form S-3 (File No. 333- 57364)
has been filed with and declared effective by the Securities and Exchange
Commission (the "Commission") on March 30, 2001, in respect of up to
$30,000,000,000 aggregate amount of securities of the Company, including the
Notes, (of which $30,000,000,000 remains available for issuance and sale as of
the date hereof). Such registration statement and any post-effective amendments
thereto, in the forms heretofore delivered or to be delivered to the Agent,
excluding exhibits to such registration statement but including all documents
incorporated by reference therein, has been declared effective by the Commission
in such form. No other document with respect to such registration statement
(other than a document incorporated by reference therein) has heretofore been
filed or transmitted for filing with the Commission; and no stop order
suspending the
4
5
effectiveness of such registration statement has been issued and no proceeding
for that purpose has been instituted or threatened by the Commission. The
various parts of such registration statement, including all exhibits thereto and
the documents incorporated by reference in the prospectus contained in such
registration statement at the time such part became effective but excluding the
Statements of Eligibility under the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"), pertaining to the Indentures (the "Forms T-1"), as
amended at the time such part became effective, are being hereinafter
collectively called the "Registration Statement." Any preliminary prospectus
included in the Registration Statement or filed with the Commission pursuant to
Rule 424(a) of the rules and regulations of the Commission under the Securities
Act of 1933, as amended (the "Act"), is hereinafter called a "Preliminary
Prospectus". The form of basic prospectus included in the Registration Statement
relating to the offering and sale of Debt Securities, Index Warrants, Preferred
Stock, Common Stock and Depositary Shares, in the form in which it has most
recently been filed, or transmitted for filing with the Commission on or prior
to the date of this Agreement, is being hereinafter called the "Basic
Prospectus." The form of prospectus supplement to the Basic Prospectus relating
to the offering and sale of the Notes included in the Registration Statement, in
the form in which it has most recently been filed or transmitted for filing with
the Commission on or prior to the date of this Agreement, is being hereinafter
called the "Prospectus Supplement." The Basic Prospectus, as supplemented by the
Prospectus Supplement, is being hereinafter called the "Prospectus." Any
reference herein to any Preliminary Prospectus, the Prospectus Supplement or the
Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to the applicable form under the Act, as of the date
of such Preliminary Prospectus, Prospectus Supplement or Prospectus, as the case
may be. Any reference to any amendment or supplement to any Preliminary
Prospectus, the Prospectus Supplement or the Prospectus, including any
supplement to the Prospectus that sets forth only the terms of a particular
issue of the Notes (a "Pricing Supplement"), shall be deemed to refer to and
include any documents filed after the date of such Preliminary Prospectus,
Prospectus Supplement or the Prospectus, as the case may be, under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
incorporated by reference in such Preliminary Prospectus, the Prospectus
Supplement or the Prospectus, as the case may be. Any reference to any amendment
to the Registration Statement shall be deemed to include any report of the
Company filed pursuant to the Exchange Act after the effective date of the
Registration Statement that is incorporated by reference in the Registration
Statement. Any reference to the Prospectus, as amended or supplemented, shall be
deemed to refer to and include the Prospectus, as amended or supplemented, in
relation to the Notes sold pursuant to this Agreement, in the form in which it
is filed with the Commission pursuant to Rule 424(b) under the Act, including
any documents incorporated by reference therein as of the date of such filing.
(b) The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the case may
be, conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the Commission
promulgated thereunder, and any further documents so filed and incorporated by
reference in the Prospectus, or
5
6
any further amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be, will conform in
all material respects to the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder.
(c) Each of the Registration Statement and the Prospectus, and
any amendment thereof or supplement thereto, and each of the Indentures, conform
or will conform in all material respects with the applicable requirements of the
Act and the Trust Indenture Act, and the rules and regulations of the Commission
thereunder.
(d) The Registration Statement, as amended as of any time, did
not and will not, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein not misleading and the Prospectus, as amended and
supplemented as of any such time, did not and will not include any untrue
statement of a material fact or omit to state a material fact necessary in order
to make the statements made, in the light of the circumstances under which they
were made, not misleading; provided, however, that the Company makes no
representations or warranties as to the information contained in or omitted from
the Registration Statement or the Prospectus or any amendment thereof or
supplement thereto in reliance upon, and in conformity with, information
furnished in writing to the Company by or on behalf of the Agent specifically
for use in the Registration Statement or the Prospectus or any amendment thereof
or supplement thereto.
(e) The Notes have been duly authorized and, when executed and
authenticated in accordance with the applicable Indenture and delivered to and
duly paid for by the purchasers thereof, will constitute valid and binding
obligations of the Company, enforceable in accordance with their respective
terms and entitled to the benefits of the applicable Indenture (subject, as to
enforcement, to applicable bankruptcy, reorganization, insolvency, moratorium or
other similar laws affecting creditors' rights generally and to general
principles of equity regardless of whether such enforceability is considered in
a proceeding in equity or at law); each of the Indentures has been duly
authorized by the Company and qualified under the Trust Indenture Act; and the
Indentures conform to the descriptions thereof in the Prospectus as amended or
supplemented to relate to such issuance of Notes.
(f) Since the date of the most recent financial statements
included in the Prospectus, as amended or supplemented, there has not been any
material adverse change in the consolidated financial condition or results of
operations of the Company and its subsidiaries, taken as a whole, which is not
disclosed in the Prospectus, as amended or supplemented.
6
7
3. Agreements of the Company. The Company agrees with the Agent that:
(a) At any time during an Offering Period or during the time a
prospectus relating to the Notes is required to be delivered under the Act,
prior to amending or supplementing the Registration Statement or the Prospectus,
the Company will furnish the Agent and the Agent's counsel with a copy of each
proposed amendment or supplement (other than an amendment or supplement to be
made pursuant to incorporation by reference of a document filed under the
Exchange Act, or a Pricing Supplement or an amendment or supplement relating
solely to an offering of debt securities other than the Notes). The Company will
promptly cause the Prospectus together with each amendment thereof or supplement
thereto to be transmitted to the Commission for filing pursuant to Rule 424(b)
by an appropriate method or will promptly cause the Prospectus together with
each amendment thereof or supplement thereto to be filed with the Commission
pursuant to said Rule. If the Prospectus is amended or supplemented (other than
a Pricing Supplement or an amendment or supplement relating solely to an
offering of debt securities other than the Notes), the Agent shall be furnished
with such information relating to such filing as it may reasonably request, and
the Agent shall not be obligated to solicit offers to purchase Notes so long as
it is not reasonably satisfied that such amendment or supplement complies in all
material respects with the provisions of the Act and the Exchange Act. At any
time during an Offering Period or during the time a prospectus relating to the
Notes is required to be delivered under the Act, the Company will promptly
advise the Agent of (i) the filing of any amendment or supplement to the
Prospectus (other than a Pricing Supplement or an amendment or supplement
relating solely to an offering of debt securities other than the Notes), (ii)
the filing or effectiveness of any amendment to the Registration Statement,
(iii) the receipt by the Company of comments from the Commission relating to, or
requests by the Commission for, any amendment of the Registration Statement or
any amendment of or supplement to the Prospectus or for any additional
information, (iv) the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement or the institution or
threatening of any proceeding for that purpose and (v) the receipt by the
Company of any notification with respect to the suspension of the qualification
of the Notes for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose. The Company will use its reasonable best
efforts to prevent the issuance of any such stop order or notice of suspension
of qualification and, if issued, to obtain as soon as possible the withdrawal
thereof. Upon the Agent's request, the Company will within a reasonable time
inform the Agent of the aggregate principal amount of Notes registered under the
Registration Statement that remain unissued.
(b) Within the time during which a prospectus relating to the
Notes is required to be delivered under the Act, the Company will comply with
all requirements imposed upon it by the Act, as now and hereafter amended, and
by the rules and regulations of the Commission thereunder, as from time to time
in force, so far as necessary to permit the continuance of sales of or dealings
in the Notes as contemplated by the provisions hereof and the Prospectus. If
during such period any event occurs as a result of which the Prospectus as then
amended or supplemented would include an
7
8
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances then existing,
not misleading, or if, in the opinion of the Company, during such period it is
necessary to amend or supplement the Registration Statement or the Prospectus to
comply with the Act, the Company will promptly notify the Agent to suspend the
solicitation of offers to purchase the Notes in its capacity as Agent and to
cease sales of any Notes it may then own as principal and, to the extent
required under the provision in the last sentence of this subsection (b), the
Company will promptly amend or supplement the Registration Statement or the
Prospectus (at the expense of the Company) so as to correct such statement or
omission or effect such compliance. If such amendment or supplement, and any
documents, certificates, opinions and letters furnished to the Agent pursuant to
subsections (i), (j) and (k) of this Section 3 in connection with the
preparation and filing of such amendment or supplement are reasonably
satisfactory in all respects to the Agent, upon the filing of such amendment or
supplement with the Commission or effectiveness of an amendment to the
Registration Statement, the Agent will resume solicitation of offers to purchase
Notes hereunder. Notwithstanding the foregoing, the Company shall not be
required to comply with the provisions of subsection (b) of this Section 3
during any period from the time the Agent shall have been notified to suspend
the solicitation of offers to purchase the Notes in its capacity as Agent
(whether under this subparagraph (b) or otherwise under this Agreement) to the
time the Company shall determine that solicitation of offers to purchase the
Notes should be resumed; provided that if the Agent holds any Notes as principal
purchased pursuant to a Terms Agreement or otherwise pursuant to this Agreement,
the Company shall comply with the provisions of subsection (b) of this Section 3
during the period when a Prospectus is required to be delivered pursuant to the
Act.
(c) The Company will comply, in a timely manner, with all
applicable requirements under the Exchange Act relating to the filing with the
Commission of the Company's reports pursuant to Sections 13(a), 13(c) or 15(d)
of the Exchange Act and, if then applicable, of the Company's proxy statements
pursuant to Section 14 of the Exchange Act.
(d) The Company will use its best efforts to qualify the Notes
for sale under the securities laws of such jurisdictions as the Agent reasonably
designates, to maintain such qualifications in effect so long as required for
the distribution of the Notes and, if requested by the Agent, to arrange for the
determination of the legality of the Notes for purchase by institutional
investors, except that the Company shall not be required in connection therewith
to qualify to do business in any jurisdiction where it is not now so qualified
or to take any action which would subject it to general or unlimited service of
process in any jurisdiction where it is not now so subject.
(e) The Company will furnish to the Agent copies of the
Registration Statement and the Prospectus (including all documents incorporated
by reference therein), and all amendments of and supplements to the Registration
Statement or the Prospectus which are filed with the Commission during the
period in which a prospectus relating to the Notes is required to be delivered
under the Act (including all documents
8
9
filed by an amendment or supplement with the Commission during such period which
are deemed to be incorporated by reference therein), in each case in such
quantities as the Agent may from time to time reasonably request.
(f) The Company will make generally available to its security
holders and to the Agent as soon as practicable, but in any event not later than
15 months after the end of the Company's current fiscal quarter, an earnings
statement (which need not be audited) covering a 12-month period beginning after
the date upon which any amendment of or supplement to the Prospectus (other than
a Pricing Supplement or an amendment or supplement relating solely to an
offering of debt securities other than the Notes) is filed pursuant to Rule 424
under the Act, which shall satisfy the provisions of Section 11(a) of the Act.
(g) The Company shall, whether or not any sale of Notes is
consummated or this Agreement is terminated, pay all expenses incident to the
performance of its obligations under this Agreement and under any Terms
Agreement, including, without limitation, the fees and disbursements of its
accountants and counsel, the cost of printing (or other production) and delivery
of the Registration Statement and the Prospectus, all amendments thereof and
supplements thereto, the Indentures, and all other documents relating to the
offering, the cost of preparing, printing, packaging and delivering the Notes,
the fees and disbursements (including reasonable fees of counsel) incurred in
connection with the qualification of the Notes for sale and determination of
eligibility for investment of the Notes under the securities or Blue Sky laws of
such jurisdictions as the Agent may designate, the fees and disbursements of the
Trustees, the fees of any agency that rates the Notes, the fees and expenses in
connection with any listing of the Notes on the New York Stock Exchange, Inc.
(the "New York Stock Exchange") or such other securities exchange agreed to in
writing by the Company, the fees and expenses incurred with respect to any
filing with the National Association of Securities Dealers, Inc. and the
reasonable fees and disbursements of Dewey Ballantine LLP ("Dewey Ballantine"),
as counsel for the Agent, or other counsel reasonably satisfactory to both the
Agent and the Company, and such other expenses, including, without limitation,
advertising expenses as may be agreed upon by the Agent and the Company;
provided, however, that with respect to any purchase of Notes by the Agent as
principal pursuant to a Terms Agreement, the fees and disbursements of Dewey
Ballantine or other counsel to the Agent relating to such purchase shall be paid
by the Agent and shall not be paid by the Company.
(h) During the term of this Agreement, the Company shall furnish
to the Agent such relevant documents and certificates of officers of the Company
relating to the business, operations and affairs of the Company, the
Registration Statement, the Prospectus, any amendments thereof or supplements
thereto, the Indentures, the Notes, this Agreement, the Procedures, any Terms
Agreement and the performance by the Company of its obligations hereunder or
thereunder as the Agent may from time to time reasonably request and shall
promptly notify the Agent orally, followed by written notice of any downgrading,
or of its receipt of any notice of any intended downgrading, in the rating
accorded any of the Company's securities by Moody's Investor Service
9
10
("Moody's") or Standard & Poor's Corporation ("Standard & Poor's") or, if one of
them no longer rates the securities of the Company, another "nationally
recognized statistical rating organization," as such term is defined for
purposes of Rule 436(g)(2) under the Act.
(i) Each time the Registration Statement or the Prospectus is
amended or supplemented (other than (a) a Pricing Supplement, (b) an amendment
or supplement relating solely to an offering of debt securities other than the
Notes or (c) an amendment or supplement made pursuant to the incorporation by
reference of a document filed under the Exchange Act), the Company will deliver
or cause to be delivered forthwith to the Agent a certificate of the Company
signed by the Chairman of the Board, any Vice Chairman, the Chief Financial
Officer, the Chief Accounting Officer, the Treasurer, Deputy Treasurer, any
Assistant Treasurer, or the Deputy General Counsel and by the Controller or the
principal financial or accounting officer of the Company (or another officer or
officers acceptable to the Agent), dated the date of the effectiveness of such
amendment or the date of filing with the Commission of such supplement or
document, as the case may be, in form reasonably satisfactory to the Agent, to
the effect that the statements contained in the certificate referred to in
Section 4(b)(iii) hereof that was last furnished to the Agent (either pursuant
to Section 4(b)(iii) or pursuant to this Section 3(i)) are true and correct at
the time of the effectiveness of such amendment or the time of filing of such
supplement or document, 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, as amended at the time of effectiveness of such amendment, and to the
Prospectus, as amended and supplemented at the date of such certificate) or, in
lieu of such certificate, a certificate of the same tenor as the certificate
referred to in Section 4(b)(iii) hereof, but modified, if necessary, to relate
to the Registration Statement, as amended at the time of the effectiveness of
such amendment, and to the Prospectus, as amended and supplemented at the date
of such certificate.
(j) Each time the Registration Statement or the Prospectus is
amended or supplemented (other than (a) a Pricing Supplement, (b) an amendment
or supplement relating solely to an offering of debt securities other than the
Notes or (c) an amendment or supplement made pursuant to the incorporation by
reference of a document under the Exchange Act), the Company shall furnish to or
cause to be furnished forthwith to the Agent the written opinion of the Deputy
General Counsel or an Associate General Counsel of the Company or other counsel
reasonably satisfactory to the Agent dated the date of the effectiveness of such
amendment or the date of filing with the Commission of such supplement or
document, as the case may be, in form reasonably satisfactory to the Agent, to
the effect set forth in Exhibit C hereto. In lieu of such opinion, counsel last
furnishing such an opinion to the Agent may furnish to the Agent a letter to the
effect that the Agent may rely on such last opinion to the same extent as though
it were dated the date of such letter and authorizing reliance on such last
opinion (except that statements in such last opinion will be deemed to relate to
the Registration Statement, as amended at the time of the effectiveness of such
amendment, and to the Prospectus, as amended and supplemented at the date of
such letter).
10
11
(k) Each time that the Registration Statement or the Prospectus
is amended or supplemented to set forth amended or supplemental financial
information (other than (a) a Pricing Supplement, (b) any amendment or
supplement relating solely to an offering of debt securities other than the
Notes or (c) an amendment or supplement made pursuant to the incorporation by
reference of a document under the Exchange Act), the Company shall cause KPMG
LLP ("KPMG"), its independent certified public accountants, to furnish forthwith
the Agent a letter, within three business days following the date of the
effectiveness of such amendment or the date of filing of such supplement or
document, as the case may be (provided that, in the event any Settlement Date
falls within such three business day period, such letter will be delivered on or
prior to such Settlement Date), in form satisfactory to the Agent, of the same
tenor as the letter referred to in Section 4(b)(iv) hereof, but modified to
relate to the Registration Statement and Prospectus, as amended and supplemented
to the date of such letter, with such changes as may be necessary to reflect
changes in the financial statements and other information derived from the
accounting records of the Company; provided, that, if the Registration Statement
or the Prospectus is amended or supplemented solely to include or incorporate by
reference financial information with respect to a fiscal quarter, KPMG may limit
the scope of such letter to the unaudited financial statements included in such
amendment or supplement.
(l) Each acceptance by the Company of an offer for the purchase
of Notes and each sale of Notes to the Agent as principal shall be deemed to be
an affirmation that the representations and warranties of the Company contained
in or made pursuant to this Agreement are true and correct in all material
respects at the time of such acceptance or sale, as the case may be, as though
made at and as of such time, and an undertaking that such representations and
warranties will be true and correct in all material respects at the time of
delivery to the purchaser or his agent, or the Agent, or the Agent as principal,
of the Notes relating to such acceptance, as the case may be, as though made at
and as of such time (and it is understood that such representations and
warranties shall relate to the Registration Statement and the Prospectus as
amended and supplemented to each such time).
(m) Anything to the contrary in this Section 3 notwithstanding,
if, at the time of any required notice, amendment or supplement to the
Registration Statement or the Prospectus, the Company shall have instructed the
Agent to suspend solicitation of offers to purchase the Notes in its capacity as
Agent of the Company and the Agent does not then hold any Notes acquired by it
as principal pursuant to a Terms Agreement, the Company shall not be obligated
to furnish or cause to be furnished to the Agent any notice, certificate,
opinion or letter otherwise required until such time as it shall determine that
solicitation of offers to purchase the Notes should be resumed; and provided
further that, prior to resuming such solicitation the Agent shall be entitled to
receive any such notices, certificates, opinions or letters not previously
furnished, accurate as of the date of such notice, certificate, opinion or
letter.
4. Conditions to the Obligations of the Agent. The Agent's obligations
to solicit offers to purchase Notes as agent of the Company, the Agent's
obligations to
11
12
purchase Notes as principal pursuant to any Terms Agreement or otherwise and the
obligation of any other purchaser to purchase Notes from the Company will be
subject to the accuracy in all material respects of the representations and
warranties on the part of the Company herein contained, to the accuracy of the
statements of the Company's officers made in each certificate furnished pursuant
to the provisions hereof and to the performance and observance by the Company of
all covenants and agreements herein contained on its part to be performed and
observed (in the case of the Agent's obligations to solicit offers to purchase
Notes, at the time of such solicitation, and, in the case of the Agent's or any
other purchaser's obligation to purchase Notes, at the time the Company accepts
the offer to purchase such Notes and at the time of purchase) and (in each case)
to the following additional conditions precedent when and as specified:
(a) On the corresponding Settlement Date:
(i) There shall not have occurred any change in or
affecting particularly the business or properties of the Company and its
subsidiaries from that set forth in the Registration Statement, as
amended or supplemented, that, in the Agent's judgment, makes it
impracticable to market the Notes on the terms and in the manner
contemplated in the Prospectus except, in the case of any purchase of
Notes by the Agent as principal, as disclosed to the Agent in writing by
the Company before it accepted the offer to purchase such Notes.
(ii) There shall not have occurred any (A) suspension or
material limitation of trading in securities generally on the New York
Stock Exchange, or any setting of minimum prices for trading on such
exchange, or any suspension of trading of any securities of the Company
on any exchange or in the over-the-counter market, (B) declaration of a
general moratorium on commercial banking activities in New York by
either federal or New York state authorities or (C) any outbreak or
escalation of major hostilities in which the United States is involved,
any declaration of war by Congress or any other substantial national or
international calamity or emergency that, in the Agent's judgment, is
material and adverse and, in the case of any of the events described in
clauses (ii)(A) through (C), such event makes it, in the Agent's
judgment, impracticable to market the Notes on the terms and in the
manner contemplated by the Prospectus, as amended or supplemented,
except, in the case of any purchase of Notes by the Agent as principal,
for any such event occurring before the Company accepted the offer to
purchase such Notes.
(iii) There shall not have been any downgrading, nor any
notice given of any intended downgrading, in the rating accorded any of
the Company's securities by Moody's or Standard & Poor's or, if one of
them no longer rates the securities of the Company, another "nationally
recognized statistical rating organization," as such term is defined for
purposes of Rule 436(g)(2) under the Act, except, in the case of any
purchase of Notes by the Agent as principal, as disclosed to the Agent
in writing by the Company before it accepted the offer to purchase such
Notes.
12
13
(b) On the Commencement Date and, if called for by any agreement
by the Agent to purchase Notes as principal, on the corresponding Settlement
Date:
(i) The Company shall have furnished to the Agent the
opinion of the Deputy General Counsel or an Associate General Counsel of
the Company (or other counsel for the Company reasonably acceptable to
the Agent) on the Commencement Date, and on the Settlement Date will
furnish the opinion of the Deputy General Counsel of the Company or an
Associate General Counsel of the Company (or other counsel for the
Company reasonably acceptable to the Agent) and, if called for by a
Terms Agreement, the opinion of other counsel, dated the Commencement
Date or the Settlement Date, as the case may be, to the effect set forth
in Exhibit C hereto.
(ii) The Agent shall have received from Dewey Ballantine
(or other counsel reasonably acceptable to the Agent and the Company),
counsel for the Agent, an opinion dated the Commencement Date or the
Settlement Date, as the case may be, to the effect set forth in Exhibit
D hereto.
(iii) The Company shall have furnished to the Agent a
certificate of the Company, signed by the Chairman of the Board, any
Vice Chairman, the Chief Financial Officer, the Chief Accounting
Officer, the Treasurer, the Deputy Treasurer, any Assistant Treasurer or
the Deputy General Counsel and by the Controller or the principal
financial or accounting officer of the Company (or another officer or
officers acceptable to the Agent), dated the Commencement Date or the
Settlement Date, as the case may be, to the effect that each signatory
of such certificate, to the best of his or her knowledge, after
reasonable investigation, certifies that:
(A) the representations and warranties of the
Company in this Agreement are true and correct in all material
respects on and as of the date of such certificate with the same
effect as if made on the date of such certificate and the Company
has complied in all material respects with all the agreements and
satisfied in all material respects all the conditions on its part
to be performed or satisfied as a condition to the obligations of
the Agent under this Agreement;
(B) no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings for
that purpose have been instituted or, to their knowledge, have
been threatened; and
(C) since the date of the most recent financial
statements included in the Prospectus, as amended and
supplemented, there has been no material adverse change in the
consolidated financial condition or results of operations of the
Company and its subsidiaries,
13
14
taken as a whole, which is not disclosed in the Prospectus, as
amended or supplemented.
(iv) KPMG, or another nationally recognized independent
accounting firm, shall have furnished to the Agent a letter or letters,
dated the Commencement Date or the Settlement Date, as the case may be,
in form and substance reasonably satisfactory to the Agent, to the
effect set forth in Exhibit E hereto.
(v) The Company shall have furnished to the Agent such
appropriate further information, certificates and documents as the Agent
may reasonably request.
5. Indemnification and Contribution.
(a) The Company will indemnify and hold harmless the Agent
against any losses, claims, damages or liabilities, joint or several, to which
the Agent may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement when it became effective,
the Prospectus, or any amendment or supplement thereto, or any related
Preliminary Prospectus, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading and will reimburse
the Agent for any legal or other expenses reasonably incurred by it in
connection with investigating or defending against such loss, claim, damage,
liability or action; provided, however, that the Company shall not be liable in
any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an untrue statement or alleged untrue statement
or omission or alleged omission made therein in reliance upon and in conformity
with written information furnished to the Company by or on behalf of the Agent
specifically for use in the preparation thereof and such indemnity with respect
to any preliminary prospectus, the Prospectus or any preliminary supplemental
prospectus, shall not inure to the benefit of the Agent (or any person
controlling the Agent) if the Company shall have delivered sufficient quantities
of the Prospectus, as amended and supplemented, to the Agent within a reasonable
time prior to the earlier of the delivery of the written confirmation of the
sale of such Notes or the delivery of such Notes to the person asserting such
loss, claim, damage, liability or action for which indemnification is sought,
and the Prospectus as so amended and supplemented (excluding documents
incorporated by reference) was not sent or given to such person by the Agent at
or prior to the earlier of the delivery of the written confirmation of the sale
of such Notes or the delivery of such Notes to such person in any case where
such sending or giving of a prospectus is required by the Act, and the untrue
statement or omission of a material fact contained in such preliminary
prospectus, such Prospectus or such preliminary supplemental prospectus, was
corrected in the Prospectus, as so amended and supplemented, provided to the
Agent.
(b) The Agent will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject,
14
15
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
part of the Registration Statement when such part became effective, the
Prospectus or any amendment or supplement thereto, or any related Preliminary
Prospectus, or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, in each case to the extent, but only
to the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made therein in reliance upon and in conformity
with written information furnished to the Company by or on behalf of the Agent
specifically for use in the preparation thereof, and will reimburse the Company
for any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending against any such loss, claim, damage, liability
or action.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party, and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate in and, to the extent that it shall wish, to assume the
defense thereof, with counsel satisfactory to such indemnified party (who shall
not, except with the consent of the indemnified party, be counsel to the
indemnified party), and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
subsection for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation.
(d) If the indemnification provided for in this Section 5 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then the indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (a) or (b) above, (i)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Agent participating in the offering that
gave rise to such losses, claims, damages or liabilities on the other from the
offering of such Notes, or (ii) if the allocation provided by clause (i) above
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 Agent on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative benefits received by the Company on the one hand
and the Agent on the other in connection with the offering of such Notes shall
be deemed to be in the same proportion as the total net proceeds from the
offering of such Notes by the Agent (before deducting expenses) received by the
Company bear to the total commissions received by the Agent in respect thereof.
The relative fault shall be
15
16
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company or the Agent and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such untrue statement or omission. The Company and the
Agent agree that it would not be just and equitable if contributions pursuant to
this subsection (d) were to be determined by pro rata allocation or by any other
method of allocation which does not take account of the equitable considerations
referred to in the first sentence of this subsection (d). The amount paid by an
indemnified party as a result of the losses, claims, damages or liabilities
referred to in the first sentence of this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any action or claim (which
shall be limited as provided in subsection (c) above if the indemnifying party
has assumed the defense of any such action in accordance with the provisions
thereof) which is the subject of this subsection (d). Notwithstanding the
provisions of this subsection (d), the Agent shall not be required to contribute
any amount in excess of the amount by which the total price at which the Notes
were offered and sold to the public by the Agent exceeds the amount of any
damages which the Agent has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. Promptly after receipt by an indemnified
party under this subsection (d) of notice of the commencement of any action
against such party in respect of which a claim for contribution may be made
against an indemnifying party under this subsection (d), such indemnified party
shall notify the indemnifying party in writing of the commencement thereof if
the notice specified in subsection (c) above has not been given with respect to
such action; but the omission so to notify the indemnifying party shall not
relieve it from any liability which it may have to any indemnified party
otherwise than under this subsection (d).
(e) The obligations of the Company under this Section 5 shall be
in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
the Agent within the meaning of the Act or the Exchange Act; and the obligations
of the Agent under this Section 5 shall be in addition to any liability which
the Agent may otherwise have and shall extend, upon the same terms and
conditions, to each director of the Company, to each officer of the Company who
has signed the Registration Statement and to each person, if any, who controls
the Company within the meaning of the Act or the Exchange Act.
6. Termination of the Appointment of the Agent. This Agreement may be
terminated at any time by either party hereto upon the giving of written notice
of such termination to the other party hereto. The termination of this Agreement
shall not require termination of any agreement by the Agent to purchase Notes as
principal, and the termination of any such Agreement shall not require
termination of this Agreement. If this Agreement is terminated, neither party
shall have any liability to the other party hereto, except as provided in the
first sentence of the second paragraph of Section 1(a), the last
16
17
proviso of Section 3(b), and Sections 3(f), 3(g), 5, 7 and 11 hereof, and except
that, if at the time of termination an offer to purchase any of the Notes has
been accepted by the Company but the time of delivery to the purchaser or its
agent of the Note or Notes relating thereto has not occurred, the Company's
representations and warranties stated in Section 2 and its obligations under
Sections 1(c), 3(a), 3(b), 3(c), 3(e), 3(h), 3(i), 3(j), 3(k), 3(l) and 4 hereof
shall also remain in full force and effect and not be terminated until the
delivery of such Notes.
7. Representations and Indemnities to Survive. With respect to the
Agent's solicitation of offers to purchase Notes as agent of the Company or the
Agent's obligation to purchase Notes as principal pursuant to any Terms
Agreement or otherwise, the respective agreements, representations, warranties,
indemnities and other statements of the Company or its officers and of the Agent
set forth in or made pursuant to this Agreement will remain in full force and
effect, regardless of any investigation made by or on behalf of the Agent or the
Company or any of the officers, directors or controlling persons referred to in
Section 5 hereof, and will survive delivery of and payment for the Notes for a
period extending to the earlier of (i) three years from the corresponding
Settlement Date for such Notes or (ii) the expiration of any applicable statute
of limitations governing such solicitation or purchase of Notes.
8. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Agent, will be mailed, delivered
or transmitted to it by any standard form of telecommunications at:
Salomon Smith Barney Inc.
7 World Trade Center
New York, NY 10048
Attention: Medium Term Note Department
Fax: (212) 783-2274
or, if sent to the Company, will be mailed, delivered or transmitted by any
standard form of telecommunications at:
Citigroup Inc.
153 East 53rd Street
New York, NY 10043
Attention: Deputy Treasurer
Reference Medium-Term Note Program
Fax: (212) 793-8098
and
399 Park Avenue
New York, New York 10043
Attention: Deputy General Counsel
Reference Medium-Term Note Program
Fax: (212) 793-3430
17
18
Any party to this Agreement may change the address to which notices or
communications to it shall be directed by giving notice in writing to the other
parties hereto.
9. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the officers
and directors and controlling persons referred to in Section 5 hereof. Nothing
expressed or implied in this Agreement or any Terms 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 and
officers and directors referred to in Section 5 and their heirs and legal
representatives, any legal or equitable right, remedy or claim under or in
respect of this Agreement or any Terms Agreement or any provision herein or
therein contained. This Agreement and any Terms Agreement and all conditions and
provisions hereof and thereof, except to the extent provided for in Section 4
hereof, are intended to be for the sole and exclusive benefit of the parties
hereto and their respective successors and said controlling persons and
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. This Agreement and
the rights and obligations of the Agent hereunder may not be assigned without
the prior written consent of the Company.
10. Waivers, Etc. Neither any failure nor delay on the part of any party
to exercise any right, remedy, power or privilege under this Agreement (singly
and collectively referred to as a "Right") shall operate as a waiver of such
Right, nor shall any single or partial exercise of any Right preclude any other
or further exercise of any Right, nor shall any waiver of any Right with respect
to any occurrence be construed as a waiver of any Right with respect to any
other occurrence.
11. Applicable Law. This Agreement will be governed by and construed in
accordance with the laws of the State of New York.
18
19
If the foregoing is in accordance with the Agent's understanding
of this agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and the Agent's acceptance shall represent a binding
agreement between the Company and the Agent.
Very truly yours,
CITIGROUP INC.
By /s/ Guy R. Whittaker
-----------------------------
Name: Guy R. Whittaker
Title: Treasurer
The foregoing Agreement
is hereby confirmed and
accepted as of the date
first written above.
SALOMON SMITH BARNEY INC.
By /s/ Charles R. Fendig
-----------------------------
Name: Charles R. Fendig
Title: Director
20
Exhibit A
CITIGROUP INC.
MEDIUM-TERM SENIOR NOTES, SERIES E
MEDIUM-TERM SUBORDINATED NOTES, SERIES E
DUE NINE MONTHS OR MORE FROM THE DATE OF ISSUE
TERMS AGREEMENT
Dated: _____, 2001
Citigroup Inc.
153 East 53rd Street
New York, NY 10043
Attention: Deputy Treasurer
Re: Distribution Agreement dated April 23, 2001
(the "Distribution Agreement")
Subject to the terms and provisions stated below, the undersigned agrees
to purchase the following principal amount of your (check box):
[ ] Medium-Term Senior Notes, Series E, Due Nine Months or More
from the Date of Issue: $ ; and/or
[ ] Medium-Term Subordinated Notes, Series E, Due Nine Months or
More from the Date of Issue: $ .
For All Notes: For Fixed Rate Notes: For Floating Rate Notes:
- -------------------- --------------------- ------------------------
Purchase Price: Interest Rate: Base Rate:
Price to Public: Index Maturity:
- --------------------------------------------------------------------------------
A-1
21
For All Notes: For Fixed Rate Notes: For Floating Rate Notes:
- -------------------- --------------------- ------------------------
Settlement Date and Spread:
time:
Place of delivery: Spread Multiplier:
Original Issue Date: Amortization
Schedule:
Date on which interest
begins to accrue (if
different from Original
Issue Date):
Specified Currency: Initial Interest Rate:
Maturity Date: Interest Reset Dates:
Interest Payment Maximum Interest Rate:
Dates:
- --------------------------------------------------------------------------------
A-2
22
For All Notes: For Fixed Rate Notes: For Floating Rate Notes:
- -------------------- --------------------- ------------------------
Regular Record Dates:
Exchange Rate Agent:
Option to receive pay-
ments in specified cur-
rency other than U.S.
Dollars:
Sinking fund:
Total amount OID:
Original yield to matu- Minimum Interest Rate:
rity:
Renewal terms:
- --------------------------------------------------------------------------------
A-3
23
For All Notes: For Fixed Rate Notes: For Floating Rate Notes:
- -------------------- --------------------- ------------------------
Option to elect repay-
ment:
Optional Repayment
Dates:
Optional Repayment
prices:
Optional Interest Rate
Reset:
Optional Reset Dates:
Optional extension of
maturity:
Length of extension
period:
- --------------------------------------------------------------------------------
A-4
24
For All Notes: For Fixed Rate Notes: For Floating Rate Notes:
- -------------------- --------------------- ------------------------
Number of extension
periods:
Final Maturity Date:
Depositary:
Optional Redemption Interest Reset Period:
Date(s):
Initial Redemption Interest payment
Date: Period:
Initial Redemption Calculation Agent:
Percentage:
Annual redemption
percentage decrease:
- --------------------------------------------------------------------------------
A-5
25
The provisions of Sections 1(b) and (c) and 2 through 11 of the
Distribution Agreement and the related definitions are incorporated by reference
herein and shall be deemed to have the same force and effect as if set forth in
full herein.
Between the date of this Agreement and the Settlement Date with respect
to this Agreement, you will not, without the undersigned's prior consent, offer,
sell, contract to sell or otherwise dispose of any debt securities of the
Company substantially similar to the Medium-Term Senior Notes, Series E, Due
Nine Months or More from the Date of Issue and the Medium-Term Subordinated
Notes, Series E, Due Nine Months or More from the Date of Issue (other than (i)
the Notes to be sold pursuant to this Agreement and (ii) commercial paper issued
in the ordinary course of business), except as may otherwise be provided herein.
The following information, opinions, certificates, letters and docu-
ments referred to in Section 4 of the Distribution Agreement will be required:
A-6
26
SALOMON SMITH BARNEY INC.
By
---------------------------------
Name:
Title:
Accepted:
CITIGROUP INC.
By
---------------------------------
Name:
Title:
A-7
27
Exhibit B
CITIGROUP INC.
Medium-Term Notes Administrative Procedures
April 23, 2001
The Medium-Term Senior Notes, Series E, Due Nine Months or More from the
Date of Issue (the "Senior Notes") and the Medium-Term Subordinated Notes,
Series E, Due Nine Months or More from the Date of Issue (the "Subordinated
Notes" and, together with the Senior Notes, the "Notes") of Citigroup Inc. (the
"Company") are to be offered on a continuing basis. Salomon Smith Barney Inc.
has agreed, as agent, to solicit purchases of the Notes issued in fully
registered form. (The term "Agent" when used in these Administrative Procedures,
means Salomon Smith Barney Inc.). The Agent will not be obligated to purchase
Notes for its own account. The Notes are being sold pursuant to a Distribution
Agreement between the Company and the agents named therein (including the Agent)
dated the date hereof (the "Distribution Agreement"). The Notes have been
registered with the Securities and Exchange Commission (the "Commission"). The
Bank of New York ("BONY") is the trustee under the Indenture, dated as of March
15, 1987, as amended from time to time, under which the Senior Notes will be
issued (the "Senior Debt Indenture"). Bank One Trust Company, N.A. (as successor
in interest to The First National Bank of Chicago) ("Bank One") is the trustee
(together with BONY, the "Trustees") under the Indenture, dated as of April 12,
2001, as amended from time to time, under which the Subordinated Notes will be
issued (the "Subordinated Debt Indenture" and, together with the Senior Debt
Indenture, the "Indentures"). The Senior Notes will constitute part of the
senior debt of the Company and will rank equally with all other unsecured and
unsubordinated debt of the Company. The Subordinated Notes will be subordinate
and junior in the right of payment to all Senior Indebtedness of the Company, to
the extent and in the manner set forth in the Subordinated Debt Indenture.
The Distribution Agreement provides that Notes may also be purchased by
the Agent acting solely as principal and not as agent. In the event of any such
purchase, the functions of both the Agent and the beneficial owner under the
administrative procedures set forth below shall be performed by the Agent acting
solely as principal, unless otherwise agreed to between the Company and the
Agent acting as principal.
Each Note will be represented by either a Global Security (as defined
hereinafter) or a certificate delivered to the Holder thereof or a Person
designated by such Holder (a "Certificated Note"). Each Global Security
representing Senior Notes will be delivered to BONY, and each Global Security
representing Subordinated Notes will be delivered to Bank One, each acting as
agent for The Depository Trust
B-1
28
Company or any successor depository selected by the Company ("DTC," which term,
as used herein, includes any successor depository selected by the Company), and
will be recorded in the book-entry system maintained by DTC (a "Book-Entry
Note"). An owner of a Book-Entry Note will not be entitled to receive a
certificate representing such Note.
The procedures to be followed during, and the specific terms of, the
solicitation of orders by the Agent and the sale as a result thereof by the
Company are explained below. Administrative and record-keeping responsibilities
will be handled for the Company by its Treasury Department. The Company will
advise the Agent and the Trustees in writing of those persons handling
administrative responsibilities with whom the Agent and the Trustees are to
communicate regarding orders to purchase Notes and the details of their
delivery.
Administrative procedures and specific terms of the offering are
explained below. Book-Entry Notes will be issued in accordance with the adminis-
trative procedures set forth in Part I hereof, as adjusted in accordance with
changes in DTC's operating requirements, and Certificated Notes will be issued
in accordance with the administrative procedures set forth in Part II hereof.
Unless otherwise defined herein, terms defined in the Indentures, the Notes or
the Prospectus Supplement relating to the Notes shall be used herein as therein
defined. Notes for which interest is calculated on the basis of a fixed interest
rate, which may be zero, are referred to herein as "Fixed Rate Notes." Notes for
which interest is calculated on the basis of a floating interest rate are
referred to herein as "Floating Rate Notes." The Company will appoint and enter
into agreements with agents (each a "Calculation Agent") to calculate interest
rates on Floating Rate Notes. Unless otherwise specified in a Pricing
Supplement, BONY will be the Calculation Agent for each Senior Note that is a
Floating Rate Note and Bank One will be the Calculation Agent for each
Subordinated Note that is a Floating Rate Note. To the extent the procedures
set forth below conflict with the provisions of the Notes, the Indentures, DTC's
operating requirements or the Distribution Agreement, the relevant provisions of
the Notes, the Indentures, DTC's operating requirements and the Distribution
Agreement shall control. The Company may, at its option, appoint Citibank, N.A.
to act as paying agent.
PART I
Administrative Procedures for
Book-Entry Notes
In connection with the qualification of the Book-Entry Notes for
eligibility in the book-entry system maintained by DTC, BONY and Bank One
(together, the "DTC Agents") will perform the custodial, document control and
administrative functions described below for the Senior Notes and the
Subordinated Notes, respectively. BONY will perform such functions in accordance
with its respective obligations under a Letter of Representations from the
Company and
B-2
29
BONY to DTC dated as of the date hereof and a Medium-Term Note Certificate
Agreement between BONY and DTC, dated as of August 17, 1989 and as amended to
date, and its obligations as a participant in DTC, including DTC's Same-Day
Funds Settlement system ("SDFS"). Bank One will perform such functions in
accordance with its respective obligations under a Letter of Representations
from the Company and Bank One to DTC dated as of the date hereof and a
Medium-Term Note Certificate Agreement between DTC and Bank One, dated as of May
26, 1989, and as amended to date, and its obligations as a participant in DTC,
including DTC's SDFS.
Issuance: On any date of settlement (as defined under "Settlement"
below) for one or more Book-Entry Notes, the Company will
issue a single global security in fully registered form
without coupons (a "Global Security") representing up to
$400,000,000 principal amount of all such Book-Entry Notes
of the same Series that have the same Original Issue Date,
Original Issue Discount provisions, if any, Interest Pay-
ment Dates, Regular Record Dates, Interest Payment Period,
redemption, repayment and extension provisions, if any,
Stated Maturity, and, in the case of Fixed Rate Notes,
interest rate, and amortization schedule, if any, or, in the
case of Floating Rate Notes, Initial Interest Rate, Base
Rate, Index Maturity, Interest Reset Period, Interest Reset
Dates, Spread and/or Spread Multiplier, if any, Minimum
Interest Rate, if any, and Maximum Interest Rate, if any
and, in each case, any other relevant terms (collectively,
the "Terms"). Each Global Security will be dated and issued
as of the date of its settlement. Each Global Security will
bear an Original Issue Date, which will be (i) with respect
to an original Global Security (or any portion thereof), the
Original Issue Date specified in such Global Security and
(ii) following a consolidation of Global Securities, with
respect to the Global Security resulting from such con-
solidation, the most recent Interest Payment Date to which
interest has been paid or duly provided for on the
predecessor Global Securities, regardless of the date of
authentication of such resulting Global Security. No Global
Security will represent (i) both Fixed Rate and Floating
Rate Book-Entry Notes or (ii) any
B-3
30
Certificated Note or (iii) both Senior Notes and
Subordinated Notes.
Identification
Numbers: The Company has arranged with the CUSIP Service Bureau of
Standard & Poor's Corporation (the "CUSIP Service Bureau")
for the reservation of two series of CUSIP numbers, one for
Senior Notes and one for Subordinated Notes, each of which
series consists of approximately 900 CUSIP numbers and
relates to Global Securities representing Book-Entry Notes
and book-entry medium-term notes issued by the Company with
other Series designations. The DTC Agents, the Company and
DTC have obtained from the CUSIP Service Bureau a written
list of such reserved CUSIP numbers. The DTC Agents will
assign CUSIP numbers to Global Securities as described be
low under Settlement Procedure "B." DTC will notify the
CUSIP Service Bureau periodically of the CUSIP numbers that
the DTC Agents have assigned to Global Securities. Each DTC
Agent will notify the Company at any time when fewer than
100 of the reserved CUSIP numbers remain unassigned to
Global Securities, and, if it deems necessary, the Company
will reserve additional CUSIP numbers for assignment to
Global Securities. Upon obtaining such additional CUSIP
numbers, the Company shall deliver a list of such
additional CUSIP numbers to either or both DTC Agents, as
needed, and to DTC.
Registration: Global Securities will be issued only in fully registered
form without coupons. Each Global Security will be
registered in the name of CEDE & CO., as nominee for DTC, on
the securities register for the Notes (the "Securities
Register") maintained under the applicable Indenture. The
beneficial owner of a Book-Entry Note (or one or more
indirect participants in DTC designated by such owner) will
designate one or more participants in DTC (with respect to
such Book-Entry Note, the "Participants") to act as agent or
agents for such
B-4
31
owner in connection with the book-entry system maintained
by DTC, and DTC will record in book-entry form, in
accordance with instructions provided by such Participants,
a credit balance with respect to such beneficial owner in
such Book-Entry Note in the account of such Participants.
The ownership interest of such beneficial owner (or such
participant) in such Book-Entry Note will be recorded
through the records of such Participants or through the sep-
arate records of such Participants and one or more indirect
participants in DTC.
Transfers: Transfers of a Book-Entry Note will be accomplished by book
entries made by DTC and, in turn, by Participants (and in
certain cases, one or more indirect participants in DTC)
acting on behalf of beneficial transferors and transferees
of such Note.
Exchanges: Each DTC Agent may deliver to DTC and the CUSIP Service
Bureau at any time a written notice of consolidation (a copy
of which shall be attached to the resulting Global Security
described below) specifying (i) the CUSIP numbers of two or
more outstanding Global Securities that represent (A) Fixed
Rate Book-Entry Notes of the same Series and having the
same Terms and for which interest has been paid to the same
date or (B) Floating Rate Book-Entry Notes of the same
Series and having the same Terms and for which interest has
been paid to the same date, (ii) a date, occurring at least
thirty days after such written notice is delivered and at
least thirty days before the next Interest Payment Date for
such Book-Entry Notes, on which such Global Securities shall
be exchanged for a single replacement Global Security and
(iii) a new CUSIP number to be assigned to such replacement
Global Security. Upon receipt of such a notice, DTC will
send to its participants (including the DTC Agent for such
replacement Global Security) a written reorganization notice
to the effect that such exchange will occur on such date.
Prior to the specified exchange date, such DTC Agent will
deliver to the CUSIP Service Bureau a written
B-5
32
notice setting forth such exchange date and such new CUSIP
number and stating that, as of such exchange date, the CUSIP
numbers of the Global Securities to be exchanged will no
longer be valid. On the specified exchange date, such DTC
Agent will exchange such Global Securities for a single
Global Security bearing the new CUSIP number and a new
Original Issue Date, which shall be the last date to which
interest has been paid on the underlying Book-Entry Notes,
and the CUSIP numbers of the exchanged Global Securities
will, in accordance with CUSIP Service Bureau procedures, be
canceled and not immediately reassigned. Upon such exchange,
the DTC Agent will mark the predecessor Global Security
"canceled," make appropriate entries in the DTC Agent's
records and destroy such canceled Global Security in
accordance with the terms of the applicable Indenture and
deliver a certificate of destruction to the Company.
Notwithstanding the foregoing, if the Global Securities to
be exchanged exceed $400,000,000 in aggregate principal
amount, one Global Security will be authenticated and issued
to represent each $400,000,000 of principal amount of the
exchanged Global Securities and an additional Global
Security will be authenticated and issued to represent any
remaining principal amount of such Global Securities (see
"Denominations" below).
Maturities: Each Book-Entry Note will mature on a date nine months or
more after the issue date for such Note. A Floating Rate
Book-Entry Note will mature only on an Interest Payment Date
for such Note.
Denominations: Book-Entry Notes will be issued in principal amounts of
$1,000 or any amount in excess thereof that is an integral
multiple of $1,000. If Book-Entry Notes are denominated in a
Specified Currency other than U.S. dollars, the de-
nominations of such Notes will be determined pursuant to the
provisions of the applicable Pricing Supplement. Global
Securities will be denominated in principal amounts not in
excess
B-6
33
of $400,000,000 (or the equivalent thereof). If one or more
Book-Entry Notes having an aggregate principal amount in
excess of $400,000,000 (or the equivalent thereof) would,
but for the preceding sentence, be represented by a single
Global Security, then one Global Security will be
authenticated and issued to represent each $400,000,000
principal amount (or the equivalent thereof) of such
Book-Entry Note or Notes and an additional Global Security
will be authenticated and issued to represent any remaining
principal amount of such Book-Entry Note or Notes. In such a
case, each of the Global Securities representing such
Book-Entry Note or Notes shall be assigned the same CUSIP
number.
Notice of
Redemption Dates: Each DTC Agent will, with respect to the Notes for which it
is the Trustee, give notice to DTC prior to each Redemption
Date (as specified in the Note) if any at the time and in
the manner set forth in the applicable Letter of Representa-
tions.
Interest: General. Unless otherwise indicated in the applicable
Pricing Supplement, interest, if any, on each Book-Entry
Note will accrue from the Original Issue Date (or such other
date on which interest otherwise begins to accrue (if
different than the Original Issue Date)) of the Global
Security representing such Book-Entry Note for the first
interest period or the last date to which interest has been
paid, if any, for each subsequent interest period, on the
Global Security representing such Book-Entry Note, and will
be calculated and paid in the manner and on the Interest
Payment Dates described in such Book-Entry Note and in the
Prospectus (as defined in the Distribution Agreement), as
supplemented by the applicable Pricing Supplement. Unless
otherwise specified, each payment of interest on a
Book-Entry Note will include interest accrued to but
excluding the Interest Payment Date; provided, that in the
case of Floating Rate Notes that reset daily or weekly,
interest payments will include interest accrued to but
excluding the next preceding Regular Re-
B-7
34
cord Date, except that at stated Maturity, the interest
payable will include interest accrued to, but excluding, the
Maturity. Interest payable at the Maturity of a Book-Entry
Note will be pay able to the Person to whom the principal of
such Note is payable. Standard & Poor's Corporation will
use the information received in the pending deposit message
described under Settlement Procedure "C" below in order to
include the amount of any interest payable and certain other
information regarding the related Global Security in the
appropriate (daily or weekly) bond report published by
Standard & Poor's Corporation.
Regular Record Dates. The Regular Record Date with respect
to any Interest Payment Date for a Floating Rate Note, Fixed
Rate Note or Indexed Rate Note shall be the date (whether or
not a Business Day) fifteen calendar days immediately
preceding such Interest Payment Date.
Payments of
Principal and
Interest: Payment of Interest Only. Promptly after each Regular Record
Date, the DTC Agent for each Global Security will deliver to
the Company and DTC a written notice setting forth, by CUSIP
number, the amount of interest to be paid on each Global
Security on the following Interest Payment Date (other than
an Interest Payment Date coinciding with Maturity) and the
total of such amounts. DTC will confirm the amount payable
on each Global Security on such Interest Payment Date by
reference to the appropriate (daily or weekly) bond reports
published by Standard & Poor's Corporation. The Company will
pay to the Trustee for the Notes represented by such Global
Security the total amount of interest due on such Interest
Payment Date (other than at Maturity), and such Trustee will
pay such amount to DTC, at the times and in the manner set
forth below under "Manner of Payment." If any Interest
Payment Date for a Book-Entry Note is not a Business Day,
the payment due on such day shall be made on the next
succeeding Business Day and no interest shall accrue as a
result of
B-8
35
such delayed payment. In the case of a Floating Rate Note
that is a LIBOR note or a EURIBOR note (each as described in
the Prospectus), if postponement to the next business day
would cause the interest payment date to be in the next
succeeding calendar month, the Interest Payment Date will
instead be the immediately preceding Business Day.
Payments at Maturity or Upon Redemption. On or about the
first Business Day of each month, each DTC Agent will, with
respect to the Global Securities for which it acts as DTC
Agent, deliver to the Company, DTC and the applicable
Trustee a written list of principal and interest to be paid
on each Global Security maturing either at Maturity or on a
Redemption Date in the following month. The DTC Agent for
each Global Security, the Company and DTC will confirm the
amounts of such principal and interest payments with respect
to each such Global Security on or about the fifth Business
Day preceding the Maturity Date or Redemption Date of such
Global Security. On or before such Maturity or Redemption,
the Company will pay to the Trustee for the Notes
represented by such Global Security the principal amount or
redemption price of such Global Security, together with
interest due at such Maturity or redemption in the manner
set forth below under "Manner of Payment." Such Trustee will
pay such amount to DTC at the times and in the manner set
forth below under "Manner of Payment." If any Maturity of a
Global Security representing Book-Entry Notes is not a
Business Day, the payment due on such day shall be made on
the next succeeding Business Day and no interest shall
accrue on such payment for the period from and after such
Maturity Date or Redemption Date. Promptly after payment to
DTC of the principal and interest or redemption price due on
the Maturity Date or Redemption Date of such Global
Security, the Trustee for such Global Security will cancel
and destroy such Global Security in accordance with the
appli-
B-9
36
cable Indenture and, if requested, deliver a certificate of
destruction to the Company.
Manner of Payment. The total amount of any principal and
interest or redemption price due on Global Securities on any
Interest Payment Date or at Maturity or upon redemption or
repayment shall be paid by the Company to the Trustee for
the Notes represented by such Global Security in immediately
available funds no later than 9:30 A.M. (New York City time)
on such date. The Company will make such payment on such
Global Securities by instructing such Trustee to withdraw
funds from an account maintained by the Company with the DTC
Agent for the Notes represented by such Global Securities.
The Company will confirm any such instructions in writing to
such Trustee. Prior to 10 A.M. (New York City time) on the
date of Maturity or as soon as possible thereafter, such
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 Re serve previously
specified by DTC, in funds available for immediate use by
DTC, each payment of principal (together with interest
thereon) due on a Global Security on such Maturity Date or
Redemption Date. On each Interest Payment Date (other than
at Maturity), interest payments shall be made to DTC, in
same day funds, in accordance with existing arrangements
between the relevant DTC Agent and DTC. On each such date,
DTC will pay, in accordance with its SDFS operating proce-
dures then in effect, such amounts in funds available for
immediate use to the respective Participants in whose names
the Book-Entry Notes represented by such Global Securities
are recorded in the book-entry system maintained by DTC.
None of the Company (as issuer or as paying agent), the
Trustee or such DTC Agent shall have any direct
responsibility or liability for the payment by DTC to such
Participants of the principal of and interest on the
Book-Entry Notes.
B-10
37
If an issue of Notes is denominated in a currency other
than the U.S. dollar, the Company will make payments of
principal and any interest in the currency in which the
Notes are denominated (the "foreign currency") or in U.S.
dollars. DTC has elected to have all such payments of
principal and interest in U.S. dollars unless notified by
any of its Participants through which an interest in the
Notes is held that it elects, in accordance with and to the
extent permitted by the applicable Pricing Supplement and
the Note, to receive such payment of principal or interest
in the foreign currency. On or prior to the third Business
Day after the record date for payment of interest and
twelve days prior to the date for payment of principal,
such Participant shall notify DTC of (i) its election to
receive all, or the specified portion, of such payment in
the foreign currency and (ii) its instructions for wire
transfer of such payment to a foreign currency account.
DTC will notify the applicable Trustee on or prior to the
fifth Business Day after the record date for payment of
interest and ten days prior to the date for payment of
principal of the portion of such payment to be received in
the foreign currency and the applicable wire transfer
instructions, and the applicable Trustee shall use such
instructions to pay the Participants directly. If DTC does
not so notify the applicable Trustee, it is understood that
only U.S. dollar payments are to be made. The applicable
Trustee shall notify DTC on or prior to the second Business
Day prior to payment date of the conversion rate to be used
and the resulting U.S. dollar amount to be paid per $1,000
face amount. In the event that the applicable Trustee's
quotation to convert the foreign currency into U.S. dollars
is not available, the applicable Trustee shall notify DTC's
Dividend Department that the entire payment is to be made
in the foreign currency. In such event, DTC will ask its
Participants for payment instructions and forward such
instructions to the applicable Trustee and the applica-
B-11
38
ble Trustee shall use such instructions to pay the
Participants directly.
Withholding Taxes. The amount of any taxes required under
applicable law to be withheld from any interest or principal
or redemption payment on a Book-Entry Note will be deter
mined 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 Note.
Procedures upon
Company's Exercise
of Optional Reset
or Optional
Extension of
Maturity: Company Notice to Trustee regarding Exercise of Optional
Reset. Not less than 45 or more than 60 days before an
Optional Reset Date as set forth in a Book-Entry Note, the
Company will notify the Trustee for such Book-Entry Note
whether it is exercising its option to reset the interest
rate or Spread or Spread Multiplier, as the case may be,
for such Book-Entry Note, and if so, (i) the new interest
rate or Spread or Spread Multiplier, as the case may be, for
such Book-Entry Note during the period from such Optional
Reset Date to the next Optional Reset Date as set forth in
such Book-Entry Note or, if there is no such next Optional
Reset Date, to the Stated Maturity of such Book-Entry Note
(the "Subsequent Interest Period"); and (ii) the provisions,
if any, for redemption of such Book-Entry Note during such
Subsequent Interest Period, including the date or dates on
which or the period or periods during which such redemption
may occur during such Subsequent Interest Period.
Company Notice to Trustee regarding Exercise of Optional
Extension of Maturity. If the Company elects to exercise an
option, as set forth in a Book-Entry Note, to extend the
Stated Maturity of such Note, it will so notify the Trustee
for such Book-Entry Note no less than 45 or more than 60
days before the Stated Maturity of such Book-Entry Note, and
will further indicate (i) the new Stated Maturity; (ii) the
interest rate or Spread or Spread Multiplier, as the case
may be, applicable to the extension period; and (iii) the
provisions, if
B-12
39
any, for redemption of such Book-Entry Note during such
extension period, including the date or dates on which or
the period or periods during which such redemption may occur
during such extension period.
Trustee Notice to DTC regarding Company's Exercise of
Optional Extension or Reset. Upon receipt of notice from the
Company regarding the Company's exercise of either an
optional extension of maturity or an optional reset, the
Trustee for the Book-Entry Note will deliver a notice to DTC
not less than 40 days before the Optional Reset Date (in
which case a "Reset Notice") or the Stated Maturity (in
which case an "Extension Notice"), as the case may be, which
Reset Notice or Extension Notice shall identify such
Book-Entry Note by CUSIP number and shall contain the
information required by the terms of the Book-Entry Note.
Trustee Notice to Company regarding Option to be Repaid. If,
after receipt of either a Reset Notice or an Extension
Notice, DTC exercises the option for repayment by tendering
the Global Security representing the Book-Entry Note to be
repaid as set forth in such Note, the Trustee for such
Book-Entry Note shall give notice to the Company not less
than 22 days before the Optional Reset Date or the old
Stated Maturity, as the case may be, of the principal amount
of Book-Entry Notes to be repaid on such Optional Reset Date
or old Stated Maturity, as the case may be.
Company Notice regarding New Interest Rate or New Spread or
Spread Multiplier. If the Company elects to revoke the
interest rate or Spread or Spread Multiplier provided for in
the Reset Notice and establish a higher interest rate or
Spread or Spread Multiplier for an Optional Reset Period or
extension period, as the case may be, it shall, not less
than 20 days before such Optional Reset Date or old Stated
Maturity, so notify the Trustee for the affected Book-Entry
Note. The Trustee will immedi-
B-13
40
ately thereafter notify DTC of the new interest rate or
Spread or Spread Multiplier applicable to such Book-Entry
Note.
Trustee Notice to Company regarding DTC Revocation of Option
to be Repaid. If, after DTC has tendered any Book-Entry
Notes for repayment pursuant to an Extension Notice or an
Reset Notice, DTC then revokes such tender for repayment,
the Trustee for such Book-Entry Notes shall give notice to
the Company not less than five days prior to the Stated
Maturity or Optional Reset Date, as the case may be, of such
revocation and of the principal amount of Book-Entry Notes
for which tender for repayment has been revoked.
Deposit of Repayment Price. On or before any old Stated
Maturity where the Maturity has been extended, and on or
before any Optional Reset Date, the Company shall deposit
with such Trustee an amount of money sufficient to pay the
principal amount, plus interest accrued to such old Stated
Maturity or Optional Reset Date, as the case may be, for all
the Book-Entry Notes or portions thereof for which such
Trustee serves as Trustee and which are to be repaid on such
old Stated Maturity or Optional Reset Date, as the case may
be. Such Trustee will use such money to repay such
Book-Entry Notes pursuant to the terms set forth in such
Notes.
Procedures upon
Company's Exercise
of Optional
Redemption: Company Notice to Trustee regarding Exercise of Optional
Redemption. At least 45 days prior to the date on which it
intends to redeem a Book-Entry Note, the Company will notify
the Trustee for such Book-Entry Note that it is exercising
such option with respect to such Book-Entry Note on such
date and the redemption price of such Book-Entry Notes.
Trustee Notice to DTC regarding Company's Exercise of
Optional Redemption. After receipt of notice that the
Company is exercising its option to redeem a Book-Entry
Note, the Trustee will, at least 30 days before the
Re-
B-14
41
demption Date for such Book-Entry Note, hand deliver to DTC
a notice identifying such Book-Entry Note by CUSIP number
and informing DTC of the Company's exercise of such option
with respect to such Book-Entry Note.
Deposit of Redemption Price. On or before any Redemption
Date, the Company shall deposit with such Trustee an amount
of money sufficient to pay the redemption price, plus
interest accrued to such Redemption Date, for all the
Book-Entry Notes or portions thereof for which such Trustee
serves as Trustee and which are to be repaid on such
Redemption Date. Such Trustee will use such money to repay
such Book-Entry Notes pursuant to the terms set forth in
such Notes.
Payments of
Principal and
Interest Upon
Exercise of Optional
Repayment (Except
Pursuant to
Company's Exercise
of Optional Reset
or Optional
Extension): Trustee Notice to Company of Option to be Repaid. Upon
receipt of notice of exercise of the option for repayment
and the Global Securities representing the Book-Entry Notes
so to be repaid as set forth in such Notes, the Trustee for
such Book-Entry Notes shall (unless such notice was received
pursuant to the Company's exercise of an optional reset or
an optional extension of maturity, in each of which cases
the relevant procedures set forth above are to be followed)
give notice to the Company not less than 20 days prior to
each Optional Repayment Date of such Optional Repayment Date
and of the principal amount of Book-Entry Notes to be repaid
on such Optional Repayment Date.
Deposit of Repayment Price. On or prior to any Optional
Repayment Date, the Company shall deposit with such Trustee
an amount of money sufficient to pay the optional repayment
price, and accrued interest thereon to such date, of all the
Book-Entry Notes or portions thereof which are to be repaid
on such date. Such Trustee will use such money to repay such
Book-Entry Notes pursuant to the terms set forth in such
Notes.
B-15
42
Procedure for Rate
Setting and
Posting: The Company and the Agent will discuss from time to time the
aggregate principal amount of, the issuance price of, and
the interest rates to be borne by, Book-Entry Notes that may
be sold as a result of the solicitation of orders by the
Agent. If the Company decides to set prices of, and rates
borne by, any Book-Entry Notes in respect of which the Agent
is to solicit orders (the setting of such prices and rates
to be referred to herein as "posting") or if the Company
decides to change prices or rates previously posted by it,
it will promptly advise the Agent of the prices and rates to
be posted.
Acceptance and
Rejection of
Orders: Unless otherwise instructed by the Company, the Agent will
advise the Company promptly by telephone of all orders to
purchase Book-Entry Notes received by the Agent, other than
those rejected by it in whole or in part in the reasonable
exercise of its discretion. Unless otherwise agreed by the
Company and the Agent, the Company has the right to accept
orders to purchase Book-Entry Notes and may reject any such
orders in whole or in part.
Preparation
of Pricing
Supplement: If any order to purchase a Book-Entry Note is accepted by
or on behalf of the Company, the Company will prepare a
pricing supplement (a "Pricing Supplement") reflecting the
terms of such Book-Entry Note, will file one copy thereof by
electronic submission with the Commission in accordance with
the applicable paragraph of Rule 424(b) under the Act, will
deliver such number of copies thereof to the Agent as the
Agent shall request and will, on the Agent's behalf, file
three copies of such Pricing Supplement with the National
Association of Securities Dealers, Inc. (the "NASD"). The
Agent will cause a Prospectus and such Pricing Supplement to
be delivered to the purchaser of such Book-Entry Note.
In each instance that a Pricing Supplement is prepared, the
Agent will affix the Pricing Supplement to Prospectuses
prior to their use. Outdated Pricing Supplements and the
Pro-
B-16
43
spectuses to which they are attached (other than those
retained for files), will be destroyed.
Copies of the appropriate number of Pricing Supplements
shall be delivered to the Agent at the following address by
11:00 A.M., New York City time, on the Business Day
following the acceptance of an offer by or on behalf of the
Company: to Salomon Smith Barney Inc., 7 World Trade Center,
New York, New York 10048 (with a copy transmitted by
telecopy to (212) 783-2274, Attention: Medium Term Note
Department).
Suspension of
Solicitation;
Amendment or
Supplement: Subject to the Company's representations, warranties and
covenants contained in the Distribution Agreement, the
Company may instruct the Agent to suspend at any time, for
any period of time or permanently, the solicitation of
orders to purchase Book-Entry Notes. Upon receipt of such
instructions, the Agent will forthwith suspend solicitation
until such time as the Company has advised it such
solicitation may be resumed.
In the event that at the time the Company suspends
solicitation of purchases there shall be any orders
outstanding for settlement, the Company will promptly advise
the Agent, the Trustees and the DTC Agents whether such
orders may be settled and whether copies of the Prospectus
as in effect at the time of the suspension, together with
the appropriate Pricing Supplement, may be delivered in
connection with the settlement of such orders. The Company
will have the sole responsibility for such decision and for
any arrangements that may be made in the event that the
Company determines that such orders may not be settled or
that copies of such Prospectus may not be so delivered.
Delivery of
Prospectus: A copy of the Prospectus and a Pricing Supplement relating
to a Book-Entry Note must accompany or precede the earliest
of any written offer of such Book-Entry Note, con-
B-17
44
firmation of the purchase of such Book-Entry Note and
payment for such Book-Entry Note by its purchaser. If notice
of a change in the terms of the Book-Entry Notes is received
by the Agent between the time an order for a Book-Entry Note
is placed and the time written confirmation thereof is sent
by the Agent to a customer or his agent, such confirmation
shall be accompanied by a Prospectus and Pricing Supplement
setting forth the terms in effect when the order was placed.
The Agent will deliver a Prospectus and Pricing Supplement
as herein described with respect to each Book-Entry Note
sold by it. The Company will make such delivery if such
Book-Entry Note is sold directly by the Company to a
purchaser (other than the Agent).
Confirmation: For each order to purchase a Book-Entry Note solicited by
the Agent and accepted by or on behalf of the Company, the
Agent will issue a confirmation to the purchaser, with a
copy to the Company, setting forth the details set forth
above and delivery and payment instructions.
Settlement: The receipt by the Company of immediately available funds in
payment for a Book-Entry Note and the authentication and
issuance of the Global Security representing such Book-Entry
Note shall constitute "settlement" with respect to such
Book-Entry Note, and the date of such settlement, the
"Settlement Date." All orders accepted by the Company will
be settled on the third Business Day next succeeding the
date of acceptance pursuant to the timetable for settlement
set forth below unless the Company and the purchaser agree
to settlement on another day which shall be no earlier than
the Business Day next succeeding the date of sale.
Settlement
Procedures: Settlement Procedures with regard to each Book-Entry Note
sold by the Company to or through the Agent, except pursuant
to a Terms Agreement, shall be as follows:
B-18
45
A. The Agent will advise the Company by
telephone (or by facsimile or other
acceptable written means) that such Note is a
Book-Entry Note and of the following
settlement information:
1. Principal or face amount.
2. Series.
3. Stated Maturity.
4. In the case of a Fixed Rate Book-Entry
Note, the interest rate and reset,
redemption, repayment and extension
provisions (if any) or, in the case of a
Floating Rate Book-Entry Note, the Base
Rate, Initial Interest Rate (if known at
such time), Interest Reset Period,
Interest Reset Dates, Index Maturity,
Spread and/or Spread Multiplier (if
any), Minimum Interest Rate (if any),
Maximum Interest Rate (if any) and
reset, redemption, repayment and
extension provisions (if any).
5. Interest Payment Dates and the Interest
Payment Period.
6. Amortization provisions, if any.
7. Settlement date and Issue Date, if
different.
8. Specified currency.
9. Denominated currency, Indexed Currency,
Base Exchange Rate, and the
Determination Date, if applicable.
10. Price.
11. Agent's commission, determined as
provided in the Distribution Agreement.
12. Whether such Book-Entry Note is an OID
Note and, if so, the total amount of
OID, the yield to maturity and the
initial accrual period OID.
B-19
46
13. Any other terms necessary to describe
the Book-Entry Note.
(a) The Company will advise the
relevant DTC Agent by telephone
(confirmed in writing at any time
on the same date), written
telecommunication or electronic
transmission of the information set
forth in Settlement Procedure "A"
above. Each such communication by
the Company shall constitute a
representation and warranty by the
Company to the DTC Agent for such
Note, the Trustee for such Note and
the Agent that (i) such Note is
then, and at the time of issuance
and sale thereof will be, duly
authorized for issuance and sale
by the Company and (ii) such Note,
and the Global Security
representing such Note, will
conform with the terms of the
Indenture for such Note. The DTC
Agent will then assign a CUSIP
number to the Global Security
representing such Book-Entry Note
and notify the Agent and the
Company by telephone (confirmed in
writing at any time on the same
date), written telecommunication or
electronic transmission of such
CUSIP number as soon as
practicable.
B. Such DTC Agent will enter a pending deposit
message through DTC's Participant Terminal
System providing the following settlement
information to DTC Standard & Poor's
Corporation, Interactive Data Corporation,
the Agent and, upon request, the Trustee for
such Notes:
1. The information set forth in Settlement
Procedure "A."
2. Identification as a Fixed Rate
Book-Entry Note or a Floating Rate
Book-Entry Note.
3. The Initial Interest Payment Date for
such Book-Entry Note, number of days by
which such date succeeds the related
Regular
B-20
47
Record Date and amount of interest
payable on such Interest Payment Date.
4. The Interest Payment Period.
5. The CUSIP number of the Global Security
representing such Book-Entry Note.
6. The participant account numbers
maintained by DTC on behalf of the
Trustee and the Agent.
7. Whether such Global Security will
represent any other Book-Entry Note (to
the extent known at such time).
C. To the extent the Company has not already
done so, the Company will deliver to the
Trustee for such Notes a Global Security in a
form that has been approved by the Company,
the Agent and the Trustee.
D. The Trustee will complete such Book-Entry
Note, stamp the appropriate legend, as
instructed by DTC, if not already set forth
thereon, and authenticate the Global Security
representing such Book-Entry Note.
E. DTC will credit such Book-Entry Note to such
DTC Agent's participant account at DTC.
F. Such DTC Agent will enter an SDFS deliver
order through DTC's Participant Terminal
System instructing DTC to (i) debit such
Book-Entry Note to such DTC Agent's
participant account and credit such
Book-Entry Note to the Agent's participant
account and (ii) debit the Agent's settlement
account and credit such DTC Agent's
settlement account for an amount equal to
the price of such Book-Entry Note less the
Agent's commission. The entry of such a
deliver order shall constitute a repre-
B-21
48
sentation and warranty by such DTC Agent to
DTC that (i) the Global Security
representing such Book-Entry Note has been
issued and authenticated and (ii) such DTC
Agent is holding such Global Security
pursuant to the Medium Term Note Certificate
Agreement between such DTC Agent and DTC.
G. Unless the Agent is purchasing such Note as
principal, the Agent will enter an SDFS
deliver order through DTC's Participant
Terminal System instructing DTC (i) to debit
such Book-Entry Note to the Agent's
participant account and credit such
Book-Entry Note to the participant accounts
of the Participants with respect to such
Book-Entry Note and (ii) to debit the
settlement accounts of such Participants and
credit the settlement account of the Agent
for an amount equal to the price of such
Book-Entry Note.
H. Transfers of funds in accordance with SDFS
deliver orders described in Settlement
Procedures "F" and "G" will be settled in
accordance with SDFS operating procedures in
effect on the settlement date.
I. Such DTC Agent will, upon receipt of funds
from the Agent in accordance with Settlement
Procedure "F," credit to an account of the
Company maintained at such DTC Agent funds
available for immediate use in the amount
transferred to such DTC Agent in accordance
with Settlement Procedure "F."
J. Unless the Agent is purchasing such
Book-Entry Note as principal, the Agent will
confirm the purchase of such Book-Entry Note
to the purchaser either by transmitting to
the Participants with respect to such
Book-Entry Note a confirmation order or
orders through DTC's
B-22
49
institutional delivery system or by mailing a
written confirmation to such purchaser.
K. Monthly, each DTC Agent will send to the
Company a statement setting forth the
principal amount of Registered Notes
Outstanding as of the date of such statement
and setting forth a brief description of any
sales of which the Company has advised such
DTC Agent but which have not yet been
settled.
Settlement
Procedures
Timetable: For sales by the Company of Book-Entry Notes solicited by
the Agent and accepted by the Company (except pursuant to a
Terms Agreement) for settlement on the first Business Day
after the sale date, Settlement Procedures "A" through "K"
set forth above shall be completed as soon as possible but
not later than the respective times (New York City time) set
forth below:
Settlement
Procedure Time
A 11:00 A.M. on the sale date
B 12:00 Noon on the sale date
C 2:00 P.M. on the sale date
D 3:00 P.M. on the day before
settlement
E 9:00 A.M. on settlement date
F 10:00 A.M. on settlement date
G-H 2:00 P.M. on settlement date
I 4:45 P.M. on settlement date
J-K 5:00 P.M. on settlement date
If a sale is to be settled more than one Business Day after
the sale date, Settlement Procedures "A," "B" and "C" shall
be completed as soon as practicable but no later than 11:00
A.M., 12:00 Noon and 2:00 P.M., respectively on the first
Business Day after the sale date. If the Initial Interest
Rate for a Floating Rate Book-Entry Note has not been
determined at the time that Settlement Procedure "A" is
completed, Settlement Procedures "B"
B-23
50
and "C" shall be completed as soon as such rate has been
determined but no later than 12:00 Noon and 2:00 P.M.,
respectively, on the Business Day before the settlement
date. Settlement Procedure "I" is subject to extension in
accordance with any extension of Fedwire closing deadlines
and in the other events specified in SDFS operating
procedures in effect on the settlement date.
If settlement of a Book-Entry Note is rescheduled or
canceled, the DTC Agent for such Book-Entry Notes after
receiving notice from the Company or the Agent, will deliver
to DTC, through DTC's Participant Terminal System, a
cancellation message to such effect by no later than 2:00
P.M. on the Business Day immediately preceding the scheduled
settlement date.
Failure to Settle: If settlement of a Book-Entry Note is rescheduled and the
DTC Agent for such Note has not entered an SDFS deliver
order with respect to a Book-Entry Note pursuant to
Settlement Procedure "G," after receiving notice from the
Company or the Agent, such DTC Agent shall deliver to DTC,
through DTC's Participant Terminal System, as soon as
practicable, a withdrawal message instructing DTC to debit
such Book-Entry Note to such DTC Agent's participant
account. DTC will process the withdrawal message, provided
that such DTC Agent's participant account contains a
principal amount of the Global Security representing such
Book-Entry Note that is at least equal to the principal
amount to be debited. If a withdrawal message is processed
with respect to all the Book-Entry Notes represented by a
Global Security, the Trustee for the Notes represented by
such Global Security will mark such Global Security
"canceled," make appropriate entries in such Trustee's
records and destroy the canceled Global Security in
accordance with the applicable Indenture and, if requested,
deliver a certificate of destruction to the Company. The
CUSIP number assigned to such Global
B-24
51
Security shall, in accordance with CUSIP Service Bureau
procedures, be canceled and not immediately reassigned. If a
withdrawal message is processed with respect to one or more,
but not all, of the Book-Entry Notes represented by a Global
Security, the DTC Agent for such Book-Entry Notes will ex-
change such Global Security for two Global Securities, one
of which shall represent such Book-Entry Notes and shall be
canceled immediately after issuance and the other of which
shall represent the other Book-Entry Notes previously
represented by the surrendered Global Security and shall
bear the CUSIP number of the surrendered Global Security.
If the purchase price for any Book-Entry Note is not timely
paid to the Participants with respect to such Note by the
beneficial purchaser thereof (or a Person, including an
indirect participant in DTC, acting on behalf of such
purchaser), such Participants and, in turn, the Presenting
Agent may enter SDFS deliver orders through DTC's
Participant Terminal System reversing the orders entered
pursuant to Settlement Procedures "G" and "F," respectively.
Thereafter, the DTC Agent for such Book-Entry Note 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 a default by the
Agent in the performance of its obligations hereunder and
under the Distribution Agreement, then the Company will
reimburse the Agent for the loss of the use of the funds
during the period when they were credited to the account of
the Company.
Notwithstanding the foregoing, upon any failure to settle
with respect to a Book-Entry Note, DTC may take any actions
in accordance with its SDFS operating procedures then in
effect. In the event of a failure to settle with respect to
one or more, but not all, of the Book-Entry Notes to have
been repre-
B-25
52
sented by a Global Security, the DTC Agent for such
Book-Entry Note or Notes will provide, in accordance with
Settlement Procedures "E" and "G," for the authentication
and issuance of a Global Security representing the other
Book-Entry Notes, which have not failed to settle, to have
been represented by such Global Security and will make
appropriate entries in its records.
Trustees Not to
Risk Funds: Nothing herein shall be deemed to require either Trustee to
risk or expend its own funds in connection with any payment
to the Company, DTC, the Agent or the purchaser, it being
understood by all parties that payments made by either
Trustee to the Company, DTC, the Agent or the purchaser
shall be made only to the extent that funds are provided to
such Trustee for such purpose.
Authenticity of
Signatures: The Company will cause each of the Trustees to furnish the
Agent from time to time with the specimen signatures of each
of such Trustee's officers, employees or agents who has been
authorized by such Trustee to authenticate Book-Entry Notes,
but the Agent will not have any 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 Book-Entry Note.
Payment of
Expenses: The Agent shall forward to the Company, on a monthly basis,
a statement of the out-of-pocket expenses incurred by such
Agent during that month that are reimbursable to it pursuant
to the terms of the Distribution Agreement. The Company will
remit payment to the Agent currently on a monthly basis.
Advertising
Costs: The Company will determine with the Agent the amount of
advertising that may be appropriate in soliciting offers to
purchase the Book-Entry Notes. Advertising expenses will be
paid by the Company.
B-26
53
PART II
Administrative Procedures for Certificated Notes
Each Trustee will serve as registrar and transfer agent in connection
with the Certificated Notes for which it serves as Trustee.
Issuance: Each Certificated Note will be dated and issued as of the
date of its authentication by the applicable Trustee. Each
Certificated Note will bear an Original Issue Date, which
will be (i) with respect to an original Certificated Note
(or any portion thereof), its original issuance date (which
will be the settlement date) and (ii) with respect to any
Certificated Note (or portion thereof) issued subsequently
upon transfer or exchange of a Certificated Note or in lieu
of a destroyed, lost or stolen Certificated Note, the
Original Issue Date of the predecessor Certificated Note,
regardless of the date of authentication of such
subsequently issued Certificated Note.
Registration: Certificated Notes will be issued only in fully registered
form without coupons.
Maturities: Each Certificated Note will mature on a date nine months or
more after the issue date for such Note. A Floating Rate
Certificated Note will mature only on an Interest Payment
Date for such Note.
Currency: The Specified Currency for a Certificated Note shall be as
set forth therein and in the applicable Pricing Supplement.
Denominations: The denomination of any Certificated Note denominated in
U.S. dollars will be a minimum of $1,000 or any amount in
excess thereof that is an integral multiple of $1,000. The
authorized denominations of Certificated Notes denominated
in a Specified Currency other than U.S. dollars shall be
determined as set forth in the applicable Pricing
Supplement.
Interest: General. Unless otherwise indicated in the applicable
Pricing Supplement, interest, if any,
B-27
54
on each Certificated Note will accrue from the Original
Issue Date (or such other date on which interest otherwise
begins to accrue (if different from the Original Issue
Date)) of such Note for the first interest period or the
last date to which interest has been paid, if any, for each
subsequent interest period, on such Note, and will be
calculated and paid in the manner and on the dates described
in such Note and in the Prospectus, as supplemented by the
applicable Pricing Supplement. Unless otherwise specified
therein, each payment of interest on a Certificated Note
will include interest accrued to but excluding the Interest
Payment Date (provided that, in the case of Certificated
Notes which reset daily or weekly, interest payments will
include accrued interest to and including the next preceding
Regular Record Date), except that at Stated Maturity, the
interest payable will include interest accrued to, but
excluding, the stated Maturity (other than a Maturity of a
Fixed Rate Certificated Note occurring on the 31st day of a
month, in which case such payment of interest will include
interest accrued to but excluding the 30th day of such
month).
Regular Record Dates. The Regular Record Dates with respect
to any Interest Payment Date for a Fixed Rate Note, Floating
Rate Note or Indexed Rate Note shall be the date (whether or
not a Business Day) fifteen calendar days immediately
preceding such Interest Payment Date.
Payments of
Interest: The applicable Trustee will pay the principal amount of each
Certificated Note at Maturity or upon redemption upon
presentation and surrender of such Note to such Trustee.
Such payment, together with payment of interest due at
Maturity or upon redemption of such Note, will be made in
funds available for immediate use by such Trustee and in
turn by the holder of such Note. Certificated Notes
presented to such Trustee at Maturity or upon redemption for
payment will be canceled and destroyed by such Trustee, and
a certificate of destruction will be delivered to the
Company. All interest
B-28
55
payments on a Certificated Note (other than interest due at
Maturity or upon redemption) will be made by check drawn on
such Trustee (or another person appointed by such Trustee)
and mailed by such Trustee to the person entitled thereto as
provided in such Note and the applicable Indenture;
provided, however, that any holder of $10,000,000 or more of
Notes having the same Interest Payment Dates will, upon
written request prior to the Regular Re cord Date in respect
of an Interest Payment Date, be entitled to receive payment
by wire transfer of immediately available funds. Following
each Regular Record Date, such Trustee will furnish the
Company with a list of interest payments to be made on the
following Interest Payment Date for each Certificated Note
and in total for all Certificated Notes. Interest at
Maturity or upon redemption will be payable to the person to
whom the payment of principal is payable. Such Trustee will
provide monthly to the Company lists of principal and
interest, to the extent ascertainable, to be paid on
Certificated Notes maturing or to be redeemed in the next
month.
Withholding Taxes. The amount of any taxes required under
applicable law to be withheld from any interest payment on a
Certificated Note will be determined and withheld by such
Trustee.
The Company will be responsible for withholding taxes on
interest paid on Certificated Notes as required by
applicable law.
If any Interest Payment Date for or the Maturity of a
Certificated Note is not a Business Day, the payment due on
such day shall be made on the next succeeding Business Day
and no interest shall accrue on account of such delayed
payment. In the case of a Floating Rate Note that is a LIBOR
note or a EURIBOR note (each as described in the
Prospectus), if postponement to the next business day would
cause the interest payment date to be in the next succeeding
calendar month, the Interest Payment Date
B-29
56
will instead be the immediately preceding Business Day.
Procedure for Rate
Setting and
Posting: The Company and the Agent will discuss from time to time the
aggregate principal amount of, the issuance price of, and
the interest rates to be borne by, Notes that may be sold as
a result of the solicitation of orders by the Agent. If the
Company decides to set prices of, and rates borne by, any
Notes in respect of which the Agent is to solicit orders
(the setting of such prices and rates to be referred to
herein as "posting") or if the Company decides to change
prices or rates previously posted by it, it will promptly
advise the Agent of the prices and rates to be posted.
Acceptance and
Rejection of
Orders: Unless otherwise instructed by the Company, the Agent will
advise the Company promptly by telephone of all orders to
purchase Certificated Notes received by the Agent, other
than those rejected by it in whole or in part in the reason
able exercise of its discretion. Unless other wise agreed by
the Company and the Agent, the Company has the sole right to
accept orders to purchase Certificated Notes and may reject
any such orders in whole or in part. Before accepting any
order to purchase a Certificated Note to be settled in less
than three Business Days, the Company shall verify that the
Trustee for such Certificated Note will have adequate time
to prepare and authenticate such Note.
Preparation of
Pricing
Supplement: If any order to purchase a Certificated Note is accepted by
or on behalf of the Company, the Company will prepare a
Pricing Supplement reflecting the terms of such Certificated
Note, will file one copy thereof by electronic submission
with the Commission in accordance with the applicable
paragraph of Rule 424(b) under the Act, will deliver such
number of copies thereof to the Agent as the Agent shall
request and will, on the Agent's behalf, file three copies
of the Pricing Supplement with the NASD. The Agent will
cause a Prospectus and Pricing Supplement to be delivered to
the purchaser of such Certificated Note.
B-30
57
Copies of the appropriate number of Pricing Supplements
shall be delivered to the Agent at the following addresses
by 11:00 A.M., New York City time, on the Business Day
following the acceptance of an offer by or on behalf of the
Company: Salomon Smith Barney Inc., 7 World Trade Center,
New York, New York 10048 (with a copy transmitted by
telecopy to (212) 783-2274, Attention: Medium Term Note
Department).
In each instance that a Pricing Supplement is prepared, the
Presenting Agent will affix the Pricing Supplement to
Prospectuses prior to their use. Outdated Pricing
Supplements and the Prospectuses to which they are attached
(other than those retained for files), will be destroyed.
Suspension of
Solicitation;
Amendment or
Supplement: Subject to the Company's representations, warranties and
covenants contained in the Distribution Agreement, the
Company may instruct the Agent to suspend at any time for
any period of time or permanently, the solicitation of
orders to purchase Certificated Notes. Upon receipt of such
instructions, the Agent will forthwith suspend solicitation
until such time as the Company has advised it that such
solicitation may be resumed.
In the event that at the time the Company suspends
solicitation of purchases there shall be any orders
outstanding for settlement, the Company will promptly
advise the Agent and the Trustees whether such orders may be
settled and whether copies of the Prospectus as in effect
at the time of the suspension, together with the appropriate
Pricing Supplement, may be delivered in connection with the
settlement of such orders. The Company will have the sole
responsibility for such decision and for any arrangements
that may be made in the event that the Company determines
that such orders may not be settled or that copies of such
Prospectus may not be so delivered.
B-31
58
Delivery of
Prospectus: A copy of the Prospectus and a Pricing Supplement relating
to a Certificated Note must accompany or precede the
earliest of any written offer of such Certificated Note,
confirmation of the purchase of such Certificated Note and
payment for such Certificated Note by its purchaser. If
notice of a change in the terms of the Certificated Notes is
received by the Agent between the time an order for a
Certificated Note is placed and the time written confirma-
tion thereof is sent by the Agent to a customer or his
agent, such confirmation shall be accompanied by a
Prospectus and Pricing Supplement setting forth the terms in
effect when the order was placed. The Agent will deliver a
Prospectus and Pricing Supplement as herein described with
respect to each Certificated Note sold by it. The Company
will make such delivery if such Certificated Note is sold
directly by the Company to a purchaser (other than the
Agent).
Confirmation: For each order to purchase a Certificated Note solicited by
the Agent and accepted by or on behalf of the Company, the
Agent will issue a confirmation to the purchaser, with a
copy to the Company, setting forth the details set forth
above and delivery and payment instructions.
Settlement: The receipt by the Company of immediately available funds in
exchange for an authenticated Certificated Note delivered
to the Agent and the Agent's delivery of such Certificated
Note against receipt of immediately available funds shall,
with respect to such Certificated Note, constitute
"settlement." All orders accepted by the Company will be
settled on the fifth Business Day next succeeding the date
of acceptance pursuant to the timetable for settlement set
forth below, unless the Company and the purchaser agree to
settlement on another day which shall be no earlier than the
next Business Day following the date of sale.
Settlement
Procedures: Settlement Procedures with regard to each Certificated Note
sold by the Company to or through the Agent, as agent
(except pursuant to a Terms Agreement), shall be as follows:
B-32
59
A. The Agent will advise the Company by telephone (or by
facsimile transmission or other acceptable written
means) that such Note is a Certificated Note and of the
following settlement information, in time for the
Trustee for such Certificated Note to prepare and
authenticate the required Note:
1. Name in which such Certificated Note is to be
registered ("Registered Owner").
2. Address of the Registered Owner and address for
payment of principal and interest.
3. Taxpayer identification number of the Registered
Owner (if available).
4. Principal or face amount.
5. Series.
6. Stated Maturity.
7. In the case of a Fixed Rate Certificated Note,
the Interest Rate and reset provisions (if any)
or, in the case of a Floating Rate Certificated
Note, the Base Rate, Initial Interest Rate (if
known at such time), Interest Reset Period,
Interest Reset Dates, Index Maturity, Spread
and/or Spread Multiplier (if any), Minimum
Interest Rate (if any), Maximum Interest Rate (if
any) and reset provisions (if any).
8. Interest Payment Dates and the Interest Payment
Period.
9. Specified Currency.
10. Denominated Currency, Indexed Currency, Base
Exchange Rate and the Determination Date, if
applicable.
11. Redemption, repayment, amortization or extension
provisions, if any.
12. Settlement Date.
B-33
60
13. Price (including currency).
14. Agent's commission, if any, determined as
provided in the Distribution Agreement.
15. Whether such Certificated Note is an OID Note,
and, if so, the total amount of OID and the yield
to maturity.
16. Any other terms necessary to describe the
Certificated Note.
B. The Company will advise the relevant Trustee by
telephone (confirmed in writing at any time on the
sale date), written telecommunication or electronic
transmission of the information set forth in Settle-
ment Procedure "A" above and the name of the Presenting
Agent.
C. The Company will deliver to the relevant Trustee a
pre-printed four-ply packet for such Certificated Note,
which packet will contain the following documents in
forms that have been approved by the Company, the Agent
and the Trustee:
1. Certificated Note with customer confirmation.
2. Stub One - For Trustee.
3. Stub Two - For Agent.
4. Stub Three - For the Company.
D. The Trustee will complete such Certificated Note and
will authenticate such Certificated Note and deliver it
(with the confirmation) and Stubs One and Two to the
Agent, and the Agent will acknowledge receipt of the
Note by stamping or otherwise marking Stub One and
returning it to the Trustee. Such delivery will be
made only against such acknowledg-
B-34
61
ment of receipt and evidence that instructions have
been given by the Agent for payment to such account as
the Company shall have specified in funds available for
immediate use, of an amount equal to the price of such
Certificated Note less the Agent's commission. In the
event that the instructions given by the Agent for pay
ment to the account of the Company are revoked, the
Company will as promptly as possible wire transfer to
the account of the Agent an amount of immediately
available funds equal to the amount of such payment
made.
E. Unless the Agent purchased the Note as principal, the
Agent will deliver such Certificated Note (with the
confirmation) to the customer against payment in
immediately payable funds. The Agent will obtain the
acknowledgment of receipt of such Certificated Note by
retaining Stub Two.
F. The Trustee will send Stub Three to the Company by
first-class mail.
Settlement
Procedures
Timetable: For orders of Certificated Notes solicited by the Agent, as
agent, and accepted by the Company, Settlement Procedures
"A" through "F" set forth above shall be completed on or
before the respective times (New York City time) set forth
below:
Settlement
Procedure Time
--------- ----
A 2:00 P.M. on the day before settlement
B On the day two Business Days before settlement
date.
C 2:15 P.M. two Business Days before settlement
D 2:15 P.M. on settlement date
E 3:00 P.M. on settlement date
F 5:00 P.M. on settlement date
B-35
62
Procedures upon
Company's Exercise
of Optional Reset
or Extension of
Maturity: Company Notice to Trustee regarding Exercise of Optional
Reset. Not less than 45 or more than 60 days before an
Optional Reset Date as set forth in a Certificated Note, the
Company will notify the Trustee for such Certificated Note
whether it is exercising its option to reset the interest
rate or Spread or Spread Multiplier, as the case may be, for
such Certificated Note, and if so, (i) the new interest rate
or Spread or Spread Multiplier, as the case may be, for such
Certificated Note during the period from such Optional Reset
Date to the next Optional Reset Date as set forth in such
Certificated Note or, if there is no such next Optional
Reset Date, to the Stated Maturity of such Certificated Note
(the "Subsequent Interest Period"); and (ii) the provisions,
if any, for redemption of such Certificated Note during
such Subsequent Interest Period, including the date or dates
on which or the period or periods during which such re-
demption may occur during such Subsequent Interest Period.
Company Notice to Trustee regarding Exercise of Optional
Extension of Maturity. If the Company elects to exercise an
option, as set forth in a Certificated Note, to extend the
Stated Maturity of such Note, it will so notify the Trustee
for such Certificated Note not less than 45 or more than 60
days before the Stated Maturity of such Certificated Note,
and will further indicate (i) the new Stated Maturity; (ii)
the interest rate or Spread or Spread Multiplier, as the
case may be, applicable to the extension period; and (iii)
the provisions, if any, for redemption of such Certificated
Note during such extension period, including the date or
dates on which or the period or periods during which such
redemption may occur during such extension period.
Trustee Notice to Holders regarding Company's Exercise of
Optional Extension or Reset. Upon receipt of notice from the
Company regarding the Company's exercise of either an
optional extension of maturity or an optional reset, the
Trustee for the Certificated Note will mail a notice, first
class, postage prepaid, to the
B-36
63
Holder of the Certificated Note not less than 40 days before
the Optional Reset Date (in which case a "Reset Notice") or
the Stated Maturity (in which case an "Extension Notice"),
as the case may be, which Reset Notice or Extension Notice
shall contain the information required by the terms of the
Certificated Note.
Trustee Notice to Company regarding Option to be Repaid. If,
after receipt of either a Reset Notice or an Extension
Notice, any Holder of a Certificated Note exercises the
option for re payment by tendering the Certificated Note to
be repaid as set forth in the Certificated Note, the Trustee
for such Certificated Note shall give notice to the Company
not less than 22 days before the Optional Reset Date, or the
old Stated Maturity, as the case may be, of the principal
amount of Certificated Notes to be repaid on such Optional
Reset Date or old Stated Maturity, as the case may be.
Company Notice regarding New Interest Rate or New Spread or
Spread Multiplier. If the Company elects to revoke the
interest rate or Spread or Spread Multiplier and establish a
higher interest rate or Spread or Spread Multiplier for an
Optional Reset Period or extension period, as the case may
be, it shall, not less than 20 days before such Optional
Reset Date or old Stated Maturity, so notify the Trustee for
the affected Certificated Note. The Trustee will immediately
thereafter notify the Holder of such Certificated Note, by
first class mail, post age prepaid, of the new higher
interest rate or Spread or Spread Multiplier applicable to
such Certificated Note.
Trustee Notice to Company regarding Holder Revocation of
Option to be Repaid. If, after the Holder of a Certificated
Note has tendered such Note for repayment pursuant to an
Extension Notice or a Reset Notice, such Holder revokes such
tender for repayment, the Trustee for such Certificated Note
shall give notice to the Company not less than five days
prior to the Stated Maturity or Optional Reset Date, as the
case
B-37
64
may be, of such revocation and of the principal amount of
Certificated Notes for which tender for repayment has been
revoked.
Deposit of Repayment Price. On or before any old Stated
Maturity where the Maturity has been extended, and on or
before any Optional Reset Date, the Company shall deposit
with such Trustee an amount of money sufficient to pay the
principal amount, plus interest accrued to such old Stated
Maturity or Optional Reset Date, as the case may be, for all
the Certificated Notes or portions thereof for which such
Trustee serves as Trustee and which are to be repaid on such
old Stated Maturity or Optional Reset Date, as the case may
be. Such Trustee will use such money to repay such
Certificated Notes pursuant to the terms set forth in such
Notes.
Procedures upon
Company's Exercise
of Optional
Redemption: Company Notice to Trustee regarding Exercise of Optional
Redemption. At least 45 days prior to the date on which it
intends to redeem a Certificated Note, the Company will
notify the Trustee for such Certificated Note that it is
exercising such option with respect to such Note on such
date.
Trustee Notice to Holders regarding Company's Exercise of
Optional Redemption. After receipt of notice that the
Company is exercising its option to redeem a Certificated
Note, the Trustee for such Certificated Note will, at least
30 days before the Redemption Date for such Certificated
Note, mail a notice, first class, postage prepaid, to the
Holder of such Certificated Note, informing such Holder of
the Company's exercise of such option with respect to such
Certificated Note.
Payments of Principal
and Interest Upon
Exercise of Optional
Repayment (Except
Pursuant to Company's
Exercise of Optional
Reset or Optional
Extension): Trustee Notice to Company of Option to be Repaid. Upon
receipt of notice of exercise of the option for repayment
and the Certificated Notes to be repaid as set forth in such
Notes, the Trustee for such Certificated Notes shall (unless
such notice was received pursuant to the Company's exercise
of an optional reset or
B-38
65
an optional extension of maturity, in each of which cases
the relevant procedures set forth above shall be followed)
give notice to the Company not less than 20 days prior to
each Optional Repayment Date of such Optional Repayment Date
and of the principal amount of Certificated Notes to be
repaid on such Optional Repayment Date.
Failure to Settle: If a purchaser fails to accept delivery of and make payment
for any Certificated Note, the Agent will notify the Company
and the applicable Trustee by telephone and return such
Note to the applicable Trustee. Upon receipt of such notice,
the Company will immediately wire transfer to the account of
the Agent an amount equal to the amount previously credited
thereto in respect of such Note. Such wire transfer will be
made on the Settlement Date, if possible, and in any event
not later than the Business Day following the settlement
date. If the failure shall have occurred for any reason
other than a default by the Agent in the performance of its
obligations hereunder and under the Distribution Agreement
with the Company, then the Company will reimburse the Agent
or the applicable Trustee, as appropriate, on an equitable
basis for its loss of the use of the funds during the
period when they were credited to the account of the
Company. Immediately upon receipt of the Certificated Note
in respect of which such failure occurred, the applicable
Trustee will mark such Note "canceled," make appropriate
entries in the applicable Trustee's records and send such
Note to the Company.
Trustees Not to
Risk Funds: Nothing herein shall be deemed to require either Trustee to
risk or expend its own funds in connection with any payment
to the Company, the Agent or the purchaser, it being
understood by all parties that payments made by either
Trustee to the Company, the Agent or the purchaser shall be
made only to the extent that funds are provided to such
Trustee for such purpose.
B-39
66
Authenticity of
Signatures: The Company will cause each Trustee to furnish the Agent
from time to time with the specimen signatures of each of
such Trustee's officers, employees or agents who has been
authorized by such Trustee to authenticate Certificated
Notes, but the Agent will not have any obligation or
liability to the Company or a Trustee in respect of the
authenticity of the signature of any officer, employee or
agent of the Company or a Trustee on any Certificated Note.
Payment of
Expenses: The Agent shall forward to the Company, on a monthly basis,
a statement of the out-of-pocket expenses incurred by the
Agent during that month that are reimbursable to it pursuant
to the terms of the Distribution Agreement. The Company will
remit payment to the Agent currently on a monthly basis.
Advertising
Costs: The Company will determine with the Agent the amount of
advertising that may be appropriate in soliciting orders to
purchase the Certificated Notes. Advertising expenses will
be paid by the Company.
B-40
67
Exhibit C
Opinion of the Deputy General Counsel of the Company
The Deputy General Counsel of the Company or an Associate General
Counsel (or other counsel for the Company reasonably acceptable to the Agent)
will furnish pursuant to Section 4(b)(i) of the Distribution Agreement the
following opinions, in substantially the form set forth below (subject to the
limitations, assumptions, qualifications and exceptions set forth
therein) (capitalized terms used but not defined herein shall have the meaning
contained in the Distribution Agreement):
1. The Company has been duly incorporated and is an existing corporation
in good standing under the laws of the State of Delaware, with corporate power
and authority to own its properties and conduct its business as described in the
Prospectus;
2. The Company is duly qualified to do business as a foreign corporation
in good standing in all jurisdictions in which it owns or leases substantial
properties or in which the conduct of its business requires such qualification
and the failure so to qualify would have a material adverse effect on the
Company;
3. Each Indenture has been duly authorized, executed and delivered by
the Company, has been duly qualified under the Trust Indenture Act and
constitutes a legal, valid and binding instrument enforceable against the
Company in accordance with its terms except to the extent that enforcement
thereof may be limited by (a) bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or other similar laws now or hereafter in
effect relating to creditors' rights generally and (b) general principles of
equity (regardless of whether such enforceability is considered in a proceeding
in equity or at law), and except further as enforcement thereof may be limited
by (x) requirements that a claim with respect to any Notes denominated other
than in U.S. dollars (or a foreign currency or foreign currency unit 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 (y) governmental
authority to limit, delay or prohibit the making of payments in foreign currency
or currency units or payments outside the United States;
4. The sale and the issuance of the Notes have been duly authorized by
all requisite corporate action on the part of the Company, and the Notes, when
executed and authenticated in accordance with the terms of the applicable
Indenture and delivered and paid for in accordance with the terms of the
Distribution Agreement, will be valid and binding obligations of the Company
enforceable against the Company in accordance with their terms and entitled to
the benefits of the Indenture, except to the extent that enforcement thereof may
be limited by (a) bankruptcy, insolvency, reorganization, moratorium, fraudulent
conveyance or other similar laws now or hereafter in effect relating to
creditors' rights generally and (b) general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law),
and except further as enforcement thereof may
C-1
68
limited by (x) requirements that a claim with respect to any Notes denominated
other than in U.S. dollars (or a foreign currency or foreign currency unit
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 (y)
governmental authority to limit, delay or prohibit the making of payments in
foreign currency or currency units or payments outside the United States. The
Notes conform in all material respects to the descriptions thereof in the
Prospectus dated March 30, 2001 and the Prospectus Supplement dated April 12,
2001 (together, the "Prospectus");
5. Each Indenture conforms in all material respects to the descriptions
thereof in the Prospectus;
6. The Distribution Agreement has been duly authorized, executed and
delivered by the Company;
7. No consent, approval, authorization or order of any court or
governmental agency, authority or body is required for the consummation by the
Company of the transactions contemplated by the Distribution Agreement or in the
Indentures, except such as have been obtained under the Act and the Trust
Indenture Act and such as may be required under the securities or Blue Sky laws
of any jurisdiction in connection with the sale of the Notes;
8. The execution, delivery and performance of the Indentures and the
Distribution Agreement will not, and the issuance and sale of the Notes in
compliance with the terms and provisions thereof, if they were issued on the
date hereof, would not, result in a breach or violation of any of the terms and
provisions of, or constitute a default under, any statute, any rule, regulation
or order of any governmental agency or body or any court having jurisdiction
over the Company or any material subsidiary of the Company or any of their
properties or any agreement or instrument known to me to which the Company or
any material subsidiary of the Company is a party or by which the Company or any
such material subsidiary is bound or to which any of the properties of the
Company or any such material subsidiary is subject, or the charter or By-Laws of
the Company or of any such material subsidiary, except that no opinion is
expressed in this paragraph 8 as to the securities or Blue Sky laws of any
jurisdiction other than as the Company or a material subsidiary may be the
subject of an order with respect to such laws of any government agency or body
or any court having jurisdiction over the Company or any material subsidiary of
the Company;
9. There are no contracts, agreements or understandings known to me
between the Company and any person granting such person the right to require the
Company to include any securities of the Company owned or to be owned by such
person in the securities registered pursuant to the Company's Registration
Statement on Form S-3 (Registration No. 333-57364, the "Registration
Statement"); and
10. The Registration Statement was declared effective under the Act,
and, to the best of my knowledge, no stop order suspending the effectiveness of
the Registration Statement has been issued and no proceedings for that purpose
have been instituted
C-2
69
or are pending or have been communicated by the Securities and Exchange Commis-
sion to the Company as being contemplated by it under the Act. The Registration
Statement, as of its effective date, and the Prospectus as of the date of the
Prospectus Supplement and as of the date hereof, comply as to form in all
material respects with the requirements of the Act, the Exchange Act and the
Trust Indenture Act and the applicable rules and regulations thereunder (except
as to the financial statements or other data of a financial or statistical
nature or the Statements of Eligibility (Forms T-1) under the Trust Indenture
Act of the Trustee, as to which no opinion is expressed); such counsel has no
reason to believe that the Registration Statement, as of its effective date,
contained any untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading or that the Prospectus, as of the date of the
Prospectus Supplement or as of the date hereof, contained or contains any untrue
statement of a material fact or omitted or omits to state any material fact
necessary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading (except as to the financial
statements or other data of a financial or statistical nature, as to which no
opinion is expressed). The descriptions in the Registration Statement and the
Prospectus of statutes, legal and governmental proceedings and contracts and
other documents are accurate and fairly present the information required to be
shown; and such counsel does not know of any legal or governmental proceedings
required to be described in the Registration Statement or Prospectus which are
not described as required or of any contracts or documents of a character
required to be described in the Registration Statement or Prospectus or to be
filed as exhibits to the Registration Statement which are not described and
filed as required; except that such counsel does not express any opinion as to
the financial statements or other data of a financial or statistical nature
contained in the Registration Statement or the Prospectus. While such counsel
shall not have independently verified and does not assume any responsibility for
the accuracy, completeness or fairness of the statements, except as expressly
referred to in the immediately preceding sentence, contained in the
Registration Statement or the Prospectus, the foregoing opinion in the second
and third sentences in this paragraph 10 is based upon such counsel's review and
discussion with members of the Company's legal staff who participated in the
preparation of the Registration Statement and the Prospectus (including any
documents annexed thereto or incorporated by reference therein) and any
amendments and supplements thereto, review and discussion of the contents
thereof (including any such annexed or incorporated documents) and the knowledge
such counsel shall have gained in his/her capacity as Deputy General Counsel or
the Associate General Counsel's to the Company, but without any independent
check or verification on such counsel's part.
C-3
70
Exhibit D
Opinion of Counsel for the Agent
Dewey Ballantine LLP (or other counsel for the Company reasonably
acceptable to the Agent and the Company), counsel for the Agent, will furnish
pursuant to Section 4(b)(ii) of the Distribution Agreement the following
opinions, in substantially the form set forth below (subject to the limitations,
assumptions, qualifications and exceptions set forth therein) (capitalized terms
used but not defined herein shall have the meaning contained in the Distribution
Agreement):
1. The Company has been incorporated and is subsisting as a corporation
in good standing under the laws of the State of Delaware (the opinion set forth
in this paragraph 1 with respect to the subsistence and good standing of the
Company may be based solely on a certificate of the Secretary of State of
Delaware).
2. Each of the Senior Debt Indenture and the Subordinated Debt Indenture
has been duly authorized, executed and delivered by the Company and is a valid
and binding agreement of the Company, enforceable against the Company in
accordance with its terms, except to the extent that enforcement thereof may be
limited by (a) bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or other similar laws now or hereafter in effect relating to creditors'
rights generally, (b) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity), (c)
requirements that a claim with respect to any Notes denominated other than in
U.S. dollars (or a judgment denominated other than in U.S. dollars 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 and (d) govern mental authority to
limit, delay or prohibit the making of payments, in foreign currency, currency
units or composite currencies, outside the United States.
3. The issuance and sale of the Notes has been duly authorized by
requisite corporate action on the part of the Company, and the Notes, when
executed and authenticated in accordance with the terms of the applicable
Indenture, when the terms of the Notes have been fixed by the Funding Committee
in conformity with the applicable Indenture and the resolutions of the Board of
Directors and the Funding Committee, and when the Notes have been issued, sold
and delivered to and paid for by you in accordance with the Distribution
Agreement, will be valid and binding obligations of the Company entitled to the
benefits of the Indenture and enforceable against the Company in accordance with
their terms, except to the extent that enforcement thereof may be limited by
(a) bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or
other similar laws now or hereafter in effect relating to creditors' rights
generally, (b) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity), (c) require-
ments that a claim with respect to any Notes denominated other than in U.S.
dollars (or a judgment denominated other than in U.S. dollars in respect of such
claim) be converted into U.S. dollars at a rate of exchange prevailing on a date
determined
D-1
71
pursuant to applicable law and (d) governmental authority to limit, delay or
prohibit the making of payments in foreign currency, currency units or composite
currencies, outside the United States. Such counsel may also assume that at the
time of the issuance, sale and delivery of each particular Note there will not
have occurred any change in law affecting the validity, legally binding
character or enforceability of such Note and that the issuance, sale and
delivery of such Note, all of the terms of such Note and the performance by the
Company of its obligations thereunder will comply with applicable law and with
each requirement or restriction imposed by any court or governmental body having
jurisdiction over the Company and will not result in a default under or a breach
of any agreement or instrument then binding upon the Company.
4. The statements made in the Prospectus dated March 30, 2001 under the
caption "Description of Debt Securities" and in the Prospectus Supplement dated
April 23, 2001 under the caption "Description of Notes," insofar as they purport
to constitute summaries of the terms of documents referred to therein, fairly
summarize the terms of such documents in all material respects.
5. The Distribution Agreement has been duly authorized, executed and
delivered by the Company.
6. The Registration Statement, as of its effective date, and the
Prospectus, as of the date of the Prospectus Supplement, appeared on their face
to be appropriately responsive in all material respects to the requirements of
the Act and the Rules and Regulations, except that in each case such counsel
need not express any opinion as to the financial statements, schedules or other
financial data included or incorporated by reference therein or excluded
therefrom or the exhibits to the Registration Statement, including the
Statements of Eligibility under The Trust Indenture Act of 1939 on Forms T-1,
and we do not assume any responsibility for the accuracy, completeness or
fairness of the statements contained in the Registration Statement and the
Prospectus.
7. The Registration Statement was declared effective under the Act and
that each of the Indentures has been qualified under the Trust Indenture Act of
1939, as amended, on March 30, 2001 and, to the best of such counsel's
knowledge, no stop order suspending its effectiveness has been issued and no
proceedings for that purpose have been instituted or are pending or threatened
by the Commission.
D-2
72
Exhibit E
Letter from Accountants
E-1
73
Exhibit F
MEDIUM-TERM SENIOR NOTES, SERIES E
MEDIUM-TERM SUBORDINATED NOTES, SERIES E
DUE NINE MONTHS OR MORE FROM THE DATE OF ISSUE
------------------
ADDITIONAL AGENTS AGREEMENT
------------------
New York, New York
Dated as of
The Agent(s) Named in Schedule I Hereto
Ladies and Gentlemen:
Reference is made to the Distribution Agreement (including the exhibits
thereto), dated as of April 23, 2001 (the "Distribution Agreement") between
Citigroup Inc., a Delaware corporation ("Citigroup"), and Salomon Smith Barney
Inc., as Agent, relating to the issue and sale from time to time of Citigroup's
Medium-Term Senior Notes, Series E, Due Nine Months or More from the Date of
Issue (the "Senior Notes") and Citigroup's Medium-Term Subordinated Notes,
Series E, Due Nine Months or More from the Date of Issue (the "Subordinated
Notes" and, together with the Senior Notes, the "Notes"). The Distribution
Agreement has been attached hereto as Annex A.
WHEREAS, Citigroup is permitted under the terms of the Distribution
Agreement to enter into agreements similar to the Distribution Agreement with
other parties; and
F-1
74
WHEREAS, the Agent(s) named in Schedule I hereto (the "Agent(s)") and
Citigroup wish to enter into an agreement, similar to the Distribution
Agreement, appointing each Agent as an additional selling agent with respect to
the Notes;
NOW, THEREFORE, in consideration of the mutual agreements set forth
herein, Citigroup hereby agrees that each Agent shall become an additional Agent
with respect to the Notes and each Agent named herein hereby agrees to become an
Agent with respect to the Notes and to be bound by the terms and conditions of
the Distribution Agreement, which terms and conditions are hereby incorporated
by reference herein, except that the term "Agent" therein shall instead mean
each Agent named herein and no other person shall be deemed to be an Agent under
this Agreement.
Unless sooner terminated in accordance with Section 6 of the
Distribution Agreement as incorporated by reference herein or unless otherwise
mutually agreed by the parties hereto in writing, this Agreement shall terminate
on __________, ____. No such termination shall affect any accrued obligations
under this Agreement. The respective indemnities, agreements, representations,
warranties and other statements of the Agent(s) and Citigroup and its officers
set forth in, or made pursuant to, this Agreement will remain in full force and
effect, regardless of any investigation, or statement as to the results thereof,
made by or on behalf of the Agent(s) or Citigroup or any of the officers,
directors or controlling persons referred to in Section 5 of the Distribution
Agreement as incorporated by reference herein, and will survive delivery of any
payment for any Notes sold by Citigroup. The provisions of Sections 3(g) and 5
of the Distribution Agreement as incorporated by reference herein shall survive
the termination of this Agreement.
F-2
75
This Agreement may be signed in counterparts, each of which shall be
deemed an original, which taken together, shall constitute one and the same
instrument.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter, including Annex A, and your acceptance shall represent a binding
agreement between you and Citigroup in accordance with its terms.
Very truly yours,
CITIGROUP INC.
By:
----------------------------------------
Name:
Title:
The foregoing Agreement
is hereby confirmed and
accepted as of the
date first above written.
[ ]
By:
----------------------------
Name:
Title:
[ ]
By:
----------------------------
Name:
Title:
F-3
76
Schedule I
Agent(s)
F-4
77
Annex A
Form of Distribution Agreement
F-5