Exhibit 1
AMERICAN GENERAL FINANCE CORPORATION
Medium-Term Notes, Series H
Due Nine Months or More
from Date of Issue
Distribution Agreement
November 14, 2002
Banc of America Securities LLC
Bank of America Corporate Center
NC1-007-07-01
100 North Tryon Street
Charlotte, North Carolina 28255
Banc One Capital Markets, Inc.
1 Bank One Plaza, Suite IL1-0595
Attn: Investment Grade Securities
Chicago, Illinois 60670
Barclays Capital Inc.
200 Park Avenue
New York, New York 10166
BNP Paribas Securities Corp.
787 Seventh Avenue
New York, New York 10019
Deutsche Bank Securities Inc.
31 West 52nd Street
New York, New York 10019
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
J.P. Morgan Securities Inc.
270 Park Avenue
New York, New York 10017
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Salomon Smith Barney Inc.
388 Greenwich Street, 34th Floor
New York, New York 10013
Wachovia Securities, Inc.
One Wachovia Center, TW-8
301 South College Street
Charlotte, North Carolina 28288-0602
Attn: MTN Syndicate Desk
Ladies and Gentlemen:
American General Finance Corporation, an Indiana corporation (the
"Company"), proposes to issue and sell up to $5,750,000,000 aggregate principal
amount, or its equivalent in foreign currencies, including the Euro, or any
composite currency, of its Medium-Term Notes, Series H, due nine months or more
from date of issue (the "Securities") and agrees with each of you (individually,
an "Agent", and collectively, the "Agents") as set forth in this Agreement.
Subject to the terms and conditions stated herein, the Company
hereby (i) appoints each Agent as an agent of the Company for the purpose of
soliciting and receiving offers to purchase the Securities from the Company and
(ii) agrees that whenever it determines to sell Securities directly to any Agent
as principal for resale to others, it will, if requested by such Agent, enter
into a separate agreement, substantially in the form of Annex I hereto, relating
to such sale or another agreement (which may be oral and confirmed in writing)
relating to the purchase by such Agent as principal (each a "Terms Agreement"),
in each case in accordance with Section 2(b) hereof. The Company reserves the
right to sell Securities directly on its own
behalf and to enter into agreements substantially identical hereto with other
broker-dealers as Agents. This Agreement shall not be construed to create either
an obligation on the part of the Company to sell any Securities or an obligation
of the Agents to purchase Securities as principal.
The terms and rights of the Securities shall be as specified in or
established pursuant to the Indenture, dated as of May 1, 1999 (as amended or
modified from time to time, the "Indenture"), between the Company and Citibank,
N.A., as Trustee (the "Trustee"). The Securities shall have the maturity ranges,
annual interest rates (if any), redemption provisions and other terms set forth
in the Prospectus referred to below as it may be supplemented from time to time.
The Securities may be issued in amounts denominated in United States dollars or
in amounts denominated in foreign currencies, including the Euro, or any
composite currency. References herein to amounts stated in United States dollars
shall be deemed to refer to the equivalent amount of foreign currency or
composite currency to the extent applicable. The Securities will be issued, and
the terms thereof established, from time to time by the Company in accordance
with the Indenture and the Administrative Procedure attached hereto as Annex II
(the "Procedure") and, if applicable, such terms will be specified in a related
Terms Agreement.
1. The Company represents and warrants to, and agrees with each
Agent that:
(a) A registration statement on Form S-3 (Registration No.
333-100345) in respect of $5,750,000,000 aggregate principal amount of debt
securities, including the Securities, has been filed with the Securities and
Exchange Commission (the "Commission"); such registration statement, in the form
heretofore delivered or to be delivered to such Agent, has been declared
effective by the Commission; no other document with respect to such registration
statement (other than the exhibits thereto, certain of the documents
incorporated by reference therein and the prospectus and prospectus supplement
filed pursuant to Rule 424(b) under the Securities Act of 1933, as amended (the
"Act")) has heretofore been filed or transmitted for filing with the Commission;
and no stop order suspending the effectiveness of such registration statement
has been issued and no proceeding for that purpose has been initiated or
threatened by the Commission (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 Act is hereinafter called
a "Preliminary Prospectus"; the various parts of the registration statement,
including all exhibits thereto and the documents incorporated by reference in
the prospectus contained in the registration statement at the time such part of
the registration statement became effective but excluding the Statement of
Eligibility (Form T-1), each as amended at the time such part of the
registration statement became effective, are hereinafter collectively called the
"Registration Statement"; the prospectus (including, if applicable, any
prospectus supplement) relating to the Securities, in the form in which it has
most recently been filed, or transmitted for filing, with the Commission on or
prior to the date of this Agreement, is hereinafter called the "Prospectus"; any
reference herein to any Preliminary Prospectus or the Prospectus shall be deemed
to refer to and include the documents incorporated by reference therein pursuant
to the applicable form under the Act, as of the date of such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any amendment or
supplement to any Preliminary Prospectus or the Prospectus, including any
supplement to the Prospectus that sets forth only the terms of a particular
issue of the Securities (a "Pricing Supplement"), shall be deemed to refer to
and include any documents filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act of 1934, as
amended (the
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"Exchange Act"), and incorporated therein by reference; any reference to any
amendment to the Registration Statement shall be deemed to refer to and include
any annual report of the Company filed pursuant to Section 13(a) or 15(d) of the
Exchange Act after the effective date of the Registration Statement that is
incorporated by reference in the Registration Statement; and any reference to
the Prospectus as amended or supplemented shall be deemed to refer to and
include the Prospectus as amended or supplemented (including by the applicable
Pricing Supplement filed in accordance with Section 4(a) hereof) in relation to
Securities to be sold pursuant to this Agreement, in the form filed or
transmitted for filing with the Commission pursuant to Rule 424(b) under the Act
and in accordance with Section 4(a) hereof, including any documents incorporated
by reference therein as of the date of such filing);
(b) The documents incorporated by reference in the Prospectus,
when they became effective or were filed with the Commission, as the case may
be, conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the Commission
thereunder, and none of such documents contained an untrue statement of a
material fact or omitted to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; and any further documents so filed and incorporated by
reference in the Prospectus, 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, and will not contain an untrue
statement of a material fact or, in the case of an Annual Report on Form 10-K,
omit to state a material fact required to be stated therein or necessary to make
the statements therein not misleading or, in the case of any other document
filed under the Exchange Act, omit to state a material fact necessary in order
to make the statements therein, in the light of the circumstances under which
they were made, not misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company by any
Agent expressly for use in the Prospectus as amended or supplemented to relate
to a particular issuance of Securities, or to any statements in any such
document which does not constitute part of the Registration Statement or
Prospectus pursuant to Rule 412 under the Act;
(c) The Registration Statement and the Prospectus conform, and any
amendments or supplements thereto will conform, in all material respects to the
requirements of the Act and the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"), and the respective rules and regulations of the
Commission thereunder, and do not and will not, as of the applicable effective
date, the date each Annual Report on Form 10-K of the Company is hereafter filed
with the Commission and each date referred to in the lead-in paragraph to
Section 6 hereof, as to the Registration Statement and any amendment thereto,
and as of the applicable filing date and each date referred to in the lead-in
paragraph to Section 6 hereof as to the Prospectus and any supplement thereto,
contain an untrue statement of a material fact or, in the case of the
Registration Statement, omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or, in the
case of the Prospectus, omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that this representation and warranty
shall not apply to (i) that part of the Registration Statement which constitutes
the Statement of Eligibility (Form T-1) under the Trust Indenture Act of the
Trustee, (ii) any
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statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Company by any Agent expressly for use in the
Prospectus as amended or supplemented to relate to a particular issuance of
Securities and (iii) any statement which does not constitute part of the
Registration Statement or Prospectus pursuant to Rule 412 under the Act;
(d) The Company has been duly incorporated and is validly existing
as a corporation under the laws of the State of Indiana, and has full corporate
power and authority to own its properties and to conduct its business as
described in the Prospectus;
(e) Since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, as amended or
supplemented, there has not been any material change in the capital stock or any
material increase in the consolidated long-term debt of the Company or any
material adverse change in or affecting the consolidated financial position,
shareholder's equity or results of operations of the Company and its
consolidated subsidiaries (a "Material Adverse Change") otherwise than as set
forth or contemplated in such Prospectus, as amended or supplemented;
(f) The series constituting the Securities has been duly
authorized and established by all necessary action by the Board of Directors,
and by the Terms and Pricing Committee of the Board of Directors, of the Company
in conformity with the Indenture and, when the terms of a particular Security
and of the issue and sale thereof have been duly authorized and established by
any two of the authorized officers to whom such authority has been delegated and
such Security has been duly completed, executed, authenticated and issued in
accordance with the Indenture, and delivered against payment therefor as
contemplated by this Agreement and any applicable Terms Agreement, such Security
will have been duly executed, authenticated, issued and delivered and will
constitute a valid and legally binding obligation of the Company entitled to the
benefits provided by the Indenture; the Indenture has been duly authorized and
qualified under the Trust Indenture Act and constitutes a valid and legally
binding obligation of the Company, enforceable in accordance with its terms,
subject to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditors' rights and to general equity principles; and the Indenture conforms
and the Securities will conform in all material respects to the descriptions
thereof in the Prospectus, as amended or supplemented;
(g) The issue and sale of the Securities and the compliance by the
Company with all of the provisions of the Securities, the Indenture, this
Agreement and any Terms Agreement, and the consummation of the transactions
herein and therein contemplated, will not conflict with or result in a breach of
any of the terms or provisions of, or constitute a default under, any material
indenture, mortgage, deed of trust, loan agreement or other material agreement
or instrument to which the Company is a party or by which the Company is bound
or to which any of the property or assets of the Company is subject, or result
in any violation of any statute or any order, rule or regulation of any court or
governmental agency or body having jurisdiction over the Company or any of its
properties, except, in each case, for such conflicts, breaches, defaults and
violations that would not have a material adverse effect on the business,
financial position, shareholder's equity or results of operations of the Company
and its Subsidiaries taken as a whole (a "Material Adverse Effect") or affect
the validity of the
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Securities, nor will such action result in any violation of the provisions of
the Restated Articles of Incorporation, as amended, or the Amended and Restated
By-Laws of the Company; and no consent, approval, authorization, order,
registration or qualification of or with any court or governmental agency or
body is required by the Company for the solicitation of offers to purchase
Securities and the issue and sale of the Securities or the consummation by the
Company of the other transactions contemplated by this Agreement, any Terms
Agreement or the Indenture, except such consents, approvals, authorizations,
orders, registrations, or qualifications the failure to obtain or make would not
have a Material Adverse Effect or affect the validity of the Securities, and
such consents, approvals, authorizations, orders, registrations or
qualifications as have been, or will have been prior to the date of this
Agreement, obtained under the Act or the Trust Indenture Act and such consents,
approvals, authorizations, orders, registrations or qualifications as may be
required under state securities or Blue Sky laws (including insurance laws of
any state relating to offers and sales of securities in such state) in
connection with the solicitation by such Agent of offers to purchase the
Securities from the Company and with purchases of the Securities by such Agent
as principal, as the case may be, both in the manner contemplated hereby; and
(h) There is no action, suit or proceeding pending, or to the
knowledge of the executive officers of the Company, threatened against the
Company or any of its subsidiaries, which has, or may reasonably be expected in
the future to have, a Material Adverse Effect, except as set forth or
contemplated in the Prospectus, as amended or supplemented; and, at each Time of
Delivery (as defined in Section 2(b) hereof), there will not be any action, suit
or proceeding pending, or to the knowledge of the executive officers of the
Company, threatened against the Company or any of its subsidiaries, which will
have had, or may reasonably be expected in the future to have, a Material
Adverse Effect except as set forth or contemplated in the Prospectus, as amended
or supplemented.
2. (a) On the basis of the representations and warranties, and
subject to the terms and conditions, herein set forth, each of the Agents hereby
severally and not jointly agrees, as agent of the Company, to use its best
efforts to solicit and receive offers to purchase the Securities from the
Company upon the terms and conditions set forth herein and in the Prospectus as
amended or supplemented from time to time.
The Company reserves the right, in its sole discretion, to instruct
the Agents to suspend at any time, for any period of time or permanently, the
solicitation of offers to purchase the Securities. Upon receipt of instructions
from the Company, the Agents will forthwith suspend solicitation of offers to
purchase Securities from the Company until such time as the Company has advised
the Agents that such solicitation may be resumed. During such time as the
solicitation of offers to purchase the Securities shall be suspended, the
Company shall not be required to comply with the provisions of Sections 4(g),
4(h) and 4(i).
The Company agrees to pay each Agent a commission, at the time of
settlement of each sale of Securities by the Company as a result of a
solicitation made by such Agent, in an amount to be agreed to by the Company and
such Agent at the time of solicitation, it being understood and agreed that the
commissions may not be the same for each Agent.
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As Agents, you are authorized to solicit offers to purchase the
Securities only in authorized denominations as set forth in the Prospectus at a
purchase price equal to 100% of their principal amount unless otherwise
indicated in the applicable Pricing Supplement to the Prospectus, as amended or
supplemented. Each Agent shall communicate to the Company, orally or in writing,
each offer to purchase Securities other than those rejected by such Agent. The
Company shall have the sole right to accept offers to purchase Securities and
may reject any proposed purchase of Securities as a whole or in part. The Agents
shall have the right, in their discretion reasonably exercised, to reject any
offer to purchase Securities, as a whole or in part, and any such rejection by
the Agents shall not be deemed a breach of their agreements contained herein.
(b) Unless the Company and the Agents otherwise agree, each sale
of Securities to any Agent as principal shall be made in accordance with the
terms of this Agreement and a Terms Agreement which will provide for the sale of
such Securities to, and the purchase thereof by, such Agent. A Terms Agreement
may also specify certain provisions relating to the reoffering of such
Securities by such Agent. The commitment of any Agent to purchase Securities
pursuant to any Terms Agreement shall be deemed to have been made on the basis
of the representations and warranties of the Company herein contained and shall
be subject to the terms and conditions herein set forth. Each Terms Agreement
shall include a specification of the principal amount of Securities to be
purchased by any Agent pursuant thereto, the price to be paid to the Company for
such Securities, the currency in which such Securities are to be denominated,
any provisions relating to rights of, and default by, underwriters acting
together with such Agent in the reoffering of the Securities, and the time (each
a "Time of Delivery") and place of delivery of and payment for such Securities.
Such Terms Agreement shall also specify any requirements for officers'
certificates, opinions of counsel and accountants' letters pursuant to Section 4
hereof.
(c) Procedural details relating to the issue and delivery of
Securities, the solicitation of offers to purchase, and purchases by any Agent
as principal of, Securities, and the payment in each case therefor, are set
forth in the Procedure. Each Agent and the Company agree to perform the
respective duties and obligations specifically provided to be performed by each
of them in the Procedure as it may be amended from time to time by written
agreement between the Agents and the Company.
3. Any documents required to be delivered pursuant to Section 6
hereof shall be made available to the Agents at the office of the counsel to the
Agents, Sidley Austin Brown & Wood LLP, 787 Seventh Avenue, New York, New York
10019.
4. The Company covenants and agrees with each Agent:
(a) To make no amendment or supplement (other than an amendment or
supplement as a result of the Company's filing of its periodic reports under the
Exchange Act) to the Registration Statement or the Prospectus after the date of
any Terms Agreement and prior to the related Time of Delivery which shall be
reasonably disapproved by any Agent that is a party to such Terms Agreement
promptly after reasonable notice thereof; to make no such amendment or
supplement (other than a Pricing Supplement relating to the Securities or any
prospectus supplement which relates solely to any offering of debt securities
other than the Securities) at
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any other time prior to having afforded each Agent a reasonable opportunity to
review it; to file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the
delivery of a prospectus is required in connection with the offering or sale of
the Securities, and during such same period to advise each Agent, promptly after
it receives notice thereof, of the time when any amendment to the Registration
Statement has been filed or becomes effective or any supplement to the
Prospectus or any amended Prospectus has been filed with, or transmitted for
filing to, the Commission (other than an amendment or supplement as a result of
the Company's filing of its periodic reports under the Exchange Act and other
than a Pricing Supplement relating to the Securities or any prospectus
supplement which relates solely to any offering of debt securities other than
the Securities), of the issuance by the Commission of any stop order or of any
order preventing or suspending the use of any prospectus relating to the
Securities, of the suspension of the qualification of the Securities for
offering or sale in any jurisdiction, of the initiation or threatening of any
proceeding for any such purpose, or of any request by the Commission for the
amendment or supplement of the Registration Statement or Prospectus or for
additional information; and, in the event of the issuance of any such stop order
or of any such order preventing or suspending the use of any such prospectus or
suspending any such qualification, to use promptly its best efforts to obtain
its withdrawal;
(b) Promptly from time to time to take such action as such Agent
may reasonably request to qualify the Securities for offering and sale under the
applicable securities and insurance laws of such jurisdictions as such Agent may
request and to comply with such laws so as to permit the continuance of sales
and dealings therein for as long as may be necessary to complete the
distribution or sale of the Securities; provided, however, that in connection
therewith the Company shall not be required to qualify as a foreign corporation
or to file a general consent to service of process in any jurisdiction;
(c) To furnish such Agent with copies of the Registration
Statement and each amendment thereto, and with copies of the Prospectus as each
time amended or supplemented, other than any Pricing Supplement (except as
provided in the Procedure) or amendment or supplement relating solely to an
offering of securities other than the Securities, in the form in which it is
filed with, or transmitted for filing to, the Commission pursuant to Rule 424
under the Act, both in such quantities as such Agent may reasonably request from
time to time; and, if the delivery of a prospectus is required at any time
within nine (9) months after the sale of the Securities (including Securities
purchased from the Company by such Agent as principal) and if at such time any
event shall have occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made when such Prospectus
is delivered, not misleading, or, if for any other reason it shall be necessary
during such same period to amend or supplement the Prospectus or to file under
the Exchange Act any document incorporated by reference in the Prospectus in
order to comply with the Act, the Exchange Act or the Trust Indenture Act, to
notify such Agent as promptly as practicable and request such Agent to suspend
solicitation of offers to purchase Securities from the Company, in its capacity
as agent of the Company and, if so notified, such Agent shall forthwith cease
such solicitations; and if the Company shall decide to amend or supplement the
Registration Statement or the Prospectus as then amended or supplemented, to so
advise such Agent promptly by telephone (with confirmation in writing) and
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to prepare and cause to be filed promptly with the Commission an amendment or
supplement to the Registration Statement or the Prospectus as then amended or
supplemented that will correct such statement or omission or effect such
compliance; provided, however, that if during such same period such Agent
continues to own Securities purchased from the Company by such Agent as
principal, the Company shall promptly prepare and file with the Commission such
an amendment or supplement, the expense of such preparation and filing to be
borne by the Company if such amendment or supplement occurs within six months of
the date of the relevant Pricing Supplement and if after such six month period,
by such Agent;
(d) To timely file such reports pursuant to the Exchange Act as
are necessary in order to make generally available to its security holders as
soon as practicable an earnings statement or statements of the Company and its
subsidiaries (which need not be audited) for the purposes of, and to provide the
benefits contemplated by, the last paragraph of Section 11(a) of the Act and
covering each twelve month period beginning not later than the first day of the
Company's fiscal quarter next following the date of any sale of Securities
hereunder;
(e) That, from the date of any Terms Agreement with such Agent and
continuing to and including the earlier of (i) the termination of the trading
restrictions for the Securities purchased thereunder, as notified to the Company
by such Agent and (ii) the related Time of Delivery, the Company will not,
without the prior written consent of such Agent, offer, sell, contract to sell
or otherwise dispose of any debt securities of the Company which mature more
than nine (9) months after such Time of Delivery and which are substantially
similar in currency, maturity or other material terms to the Securities;
(f) That each acceptance by the Company of an offer to purchase
Securities hereunder, and each sale of Securities to such Agent pursuant to a
Terms Agreement, shall be deemed to be an affirmation to such Agent that the
representations and warranties of the Company contained in or made pursuant to
this Agreement are true and correct, in all material respects, as of the date of
such acceptance or of such Terms Agreement as though made at and as of such time
(except that such statements shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented at such time);
(g) That each time (i) the Registration Statement or the
Prospectus shall be amended or supplemented by a filing under the Act (other
than by a Pricing Supplement relating to the Securities or an amendment or
supplement relating solely to an offering of securities other than the
Securities), (ii) there is filed with the Commission under the Exchange Act any
document incorporated by reference into the Prospectus as amended or
supplemented (other than any Current Report on Form 8-K relating exclusively to
the issuance of securities under the Registration Statement, or, unless any
Agent shall otherwise request, to quarterly or annual financial results of the
Company), and (iii) if so indicated in the applicable Terms Agreement, the
Company sells Securities to such Agent pursuant to a Terms Agreement, the
Company shall furnish or cause to be furnished forthwith to such Agent a
certificate of officers of the Company satisfactory to such Agent, dated the
date of filing with the Commission of such supplement or document, the date of
effectiveness of such amendment, or the date of such sale, as the case may be,
in form satisfactory to such Agent in its reasonable judgment, to the effect
that the statements contained in the certificate referred to in Section 6(f)
hereof which was last furnished to such Agent are true and correct, in all
material respects, at the time of such amendment, supplement,
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filing or sale, as the case may be, as though made at and as of such time
(except that such statements shall be deemed to relate to the Registration
Statement and the Prospectus as amended and supplemented to such date) or, in
lieu of such certificate, a certificate of the same tenor as the certificate
referred to in said Section 6(f) but modified to relate to the Registration
Statement and the Prospectus as amended and supplemented to the time of delivery
of such certificate;
(h) That each time (i) the Registration Statement or the
Prospectus shall be amended or supplemented by a filing under the Act (other
than by a Pricing Supplement relating to the Securities or an amendment or
supplement providing solely for the inclusion of additional financial
information or an amendment or supplement relating solely to an offering of
securities other than the Securities), (ii) there is filed with the Commission
under the Exchange Act any document incorporated by reference into the
Prospectus as amended and supplemented (other than any Current Report on Form
8-K or Quarterly Report on Form 10-Q, unless any Agent shall otherwise request),
and (iii) if so indicated in the applicable Terms Agreement, the Company sells
Securities to such Agent pursuant to a Terms Agreement, the Company shall
furnish or cause to be furnished forthwith to such Agent and to counsel to the
Agents a written opinion of Timothy M. Hayes, Esq., General Counsel of the
Company, or other counsel satisfactory to such Agent in its reasonable judgment,
dated the date of filing with the Commission of such supplement or document, the
date of effectiveness of such amendment, or the date of such sale, as the case
may be, in form and substance satisfactory to such Agent in its reasonable
judgment, of the same tenor as the opinion referred to in Section 6(c) hereof,
but modified to relate to the Registration Statement and the Prospectus as
amended and supplemented to the time of delivery of such opinion; or, in lieu of
such opinion, the counsel last furnishing such opinion to the Agents shall
furnish the Agents with a letter to the effect that such Agent may rely on the
opinion referred to in Section 6(c) hereof which was last furnished to such
Agent to the same extent as though it were dated the date of such letter
authorizing reliance (except that statements in such last opinion shall be
deemed to relate to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such letter authorizing reliance); and
(i) That each time (i) the Registration Statement or the
Prospectus shall be amended or supplemented by a filing under the Act to include
additional financial information, (ii) there is filed with the Commission under
the Exchange Act any document incorporated by reference into the Prospectus as
amended and supplemented which contains additional financial information (other
than any Current Report on Form 8-K relating exclusively to quarterly or annual
financial results of the Company, or, unless any Agent shall otherwise request,
any Quarterly Report on Form 10-Q), or (iii) if so indicated in the applicable
Terms Agreement, the Company sells Securities to such Agent pursuant to a Terms
Agreement, the Company shall cause the independent public accountants which have
audited the financial statements of the Company and its subsidiaries included or
incorporated by reference in the Prospectus as amended and supplemented
forthwith to furnish the Agents (or, in the case of clause (iii) above, such
Agents as are party to such Terms Agreement) a letter, dated the date of filing
with the Commission of such supplement or document, the date of effectiveness of
such amendment, or the date of such sale, as the case may be, in form
satisfactory to such Agent in its reasonable judgment, of the same tenor as the
letter referred to in Section 6(d) hereof, but modified to relate to the
Registration Statement and the Prospectus as amended 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, however,
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that where such amendment or supplement only sets forth unaudited quarterly
financial information, the scope of such letter may be limited to relate to such
unaudited financial information unless any other accounting or financial
information included therein is of a character that, in the reasonable judgment
of such Agent, such other information should be addressed by such letter.
5. The Company covenants and agrees with each Agent that the
Company will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's counsel and accountants in connection with the
registration of the Securities under the Act and all other expenses in
connection with the preparation, printing and filing of the Registration
Statement, any Preliminary Prospectus, and the Prospectus and amendments and
supplements thereto and the mailing and delivering of copies thereof to such
Agent; (ii) the reasonable fees and expenses of counsel for the Agents in
connection with the establishment of the program for the issuance of the
Securities and, except where Securities are sold to one or more Agents acting as
principal, incurred from time to time in connection with the transactions
contemplated hereby; (iii) the cost of printing, word-processing or reproducing
this Agreement, any Terms Agreement, the Indenture, any Blue Sky and Legal
Investment Memoranda and any other documents in connection with the offering,
purchase, sale and delivery of the Securities; (iv) all expenses in connection
with the qualification of the Securities for offering and sale under state
securities laws as provided in Section 4(b) hereof, including fees and
disbursements of the Agent's counsel in connection with such qualification and
in connection with the Blue Sky and legal investment surveys; (v) any fees
charged by security rating services for rating the Securities; (vi) the cost of
preparing the Securities, including any fees and expenses relating to the use of
book-entry securities; (vii) the fees and expenses of any Trustee and any
Calculation Agent and any agent of any Trustee and the fees and disbursements of
counsel for any Trustee in connection with any Indenture and the Securities;
(viii) any advertising expenses connected with the solicitation of offers to
purchase and the sale of Securities so long as such advertising expenses have
been approved by the Company; and (ix) all other costs and expenses incident to
the performance of its obligations hereunder which are not otherwise
specifically provided for in this Section. Each Agent shall pay all other fees
and expenses it incurs.
6. The obligation of any Agent, as agent of the Company, to
solicit offers to purchase the Securities and the obligation of any Agent to
purchase Securities as principal, pursuant to any Terms Agreement, shall be
subject, in such Agent's reasonable discretion, to the condition that all
representations and warranties and other statements of the Company herein are
true and correct, in all material respects, at and as of the date of this
Agreement, the date of each such solicitation, any settlement date related to
the acceptance of such an offer, and each Time of Delivery, the condition that
the Company shall have performed, in all material respects, all of its
obligations hereunder theretofore in each case to be performed and the following
additional conditions, where applicable:
(a) No stop order suspending the effectiveness of the Registration
Statement shall have been issued and no proceeding for that purpose shall have
been initiated or threatened by the Commission or to the knowledge of the
executive officers of the Company, shall be contemplated by the Commission; and
all requests for additional information on the part of the Commission shall have
been complied with to the reasonable satisfaction of such Agent;
10
(b) Such Agent shall have received, upon its request, from Sidley
Austin Brown & Wood LLP, counsel to the Agents, such opinion, dated the date of
this agreement or the Time of Delivery as specified in the applicable Terms
Agreement, with respect to the incorporation of the Company, the validity of the
Securities, the Registration Statement, the Prospectus as amended or
supplemented, and other related matters as such Agent may reasonably require,
and the Company shall have furnished to such counsel such documents as they
reasonably request for the purpose of enabling them to pass upon such matters.
In giving such opinion, Sidley Austin Brown & Wood LLP may rely as to matters of
Indiana law upon the opinion of Timothy M. Hayes, Esq., General Counsel of the
Company (or other counsel licensed to practice in the State of Indiana) referred
to in Section 6(c);
(c) Such Agent shall have received an opinion or opinions of
Timothy M. Hayes, Esq., General Counsel of the Company, or such other counsel as
shall be acceptable to such Agent, dated the date hereof or the applicable date
referred to in Section 4(h), as the case may be, to the effect that:
(i) The Company is a corporation duly incorporated and validly
existing under the laws of the State of Indiana, and has the corporate power and
authority to own, lease and operate its properties and to conduct its business
as described in the Prospectus as amended or supplemented and to enter into and
perform its obligations under, or as contemplated under, this Agreement (and if
the opinion is being given pursuant to Section 4(h) hereof as a result of the
Company having entered into a Terms Agreement requiring such opinion, the
applicable Terms Agreement);
(ii) Each of the subsidiaries of the Company has been duly
incorporated and is validly existing as a business corporation or an insurer, as
the case may be, and is in good standing under the laws of its jurisdiction of
incorporation, with corporate power and authority to own, lease and operate its
properties and conduct its business as described in the Prospectus as amended or
supplemented; provided, however, that "good standing" means with respect to any
subsidiary incorporated under the laws of the State of Indiana, that such
subsidiary has filed its most recent biennial report required by the laws of the
State of Indiana and Articles of Dissolution have not been filed in the State of
Indiana with respect to such subsidiary; to the knowledge of such counsel, the
Company and each of its subsidiaries has been duly qualified as a foreign
corporation for the transaction of business or licensed to transact business as
an insurance company, as the case may be, and is in good standing under the laws
of each other jurisdiction in which it owns or leases substantial properties, or
conducts business, and where the failure so to qualify and be in good standing
would have a material adverse effect on the business of the Company and its
subsidiaries taken as a whole; all of the outstanding shares of capital stock of
each such subsidiary have been duly authorized and validly issued, are fully
paid and non-assessable, and (except for any directors' qualifying shares) are
owned, directly or indirectly, by the Company, free and clear of all liens and
encumbrances; and, to the knowledge of such counsel, the Company and each of its
subsidiaries has all required authorizations, approvals, orders, licenses,
certificates and permits of and from all governmental regulatory officials and
bodies (including, without limitation, each insurance regulatory authority
having jurisdiction over the Company or any insurance subsidiary of the Company)
to own, lease and operate its properties and to conduct its business as
described in the Prospectus, except such authorizations, approvals, orders,
licenses, certificates and permits which, if not obtained, would not have a
11
material adverse effect on the business of the Company and its subsidiaries
taken as a whole (such counsel being entitled to rely in respect of the opinion
in this clause (ii) upon opinions (in form and substance satisfactory to the
Agents) of local counsel and of counsel for the subsidiaries, such counsel being
acceptable to counsel for the Agents, copies of which shall be furnished to each
Agent; and in respect of matters of fact upon certificates of public officials
or officers of the Company or its subsidiaries, provided that such counsel shall
state that he or she believes that he or she is justified in relying upon such
opinions);
(iii) There are no legal or governmental proceedings pending or, to
the best knowledge of such counsel, threatened, of a character that are required
to be disclosed in the Registration Statement and Prospectus as amended or
supplemented, other than as disclosed therein; to the knowledge of such counsel,
there are no contracts, indentures, mortgages, deeds of trust, loan agreements
or other documents of a character required to be described in the Registration
Statement or Prospectus as amended or supplemented (or required to be filed
under the Exchange Act if upon such filing they would be incorporated by
reference therein) or to be filed as exhibits to the Registration Statement that
are not described and filed as required and all descriptions in the Prospectus
as amended or supplemented of such documents to which the Company or its
subsidiaries are a party are accurate in all material respects;
(iv) Neither the Company nor any of its subsidiaries is in
violation of its articles of incorporation, charter or by-laws or in default in
the performance or observance of any contractual obligation known to such
counsel, the violation of or default under which has or will have a material
adverse effect on the business of the Company and its subsidiaries taken as a
whole. The issue and sale of the Securities, the compliance by the Company with
all of the provisions of the Securities, the Indenture, this Agreement (and, if
the opinion is being given pursuant to Section 4(h) hereof as a result of the
Company having entered into a Terms Agreement requiring such opinion, the
applicable Terms Agreement), and the consummation of the transactions herein and
therein contemplated will not (A) conflict with or result in a breach or
violation of any of the terms or provisions of, or constitute a default under,
any contract, indenture, mortgage, deed of trust, loan agreement or other
agreement or instrument for money borrowed to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries is
bound or to which any of the property or assets of the Company or any of its
subsidiaries is subject, or (B) result in any violation of (x) the provisions of
the Restated Articles of Incorporation, as amended, or the Amended and Restated
By-Laws of the Company or (y) any statute, order, rule, regulation, judgement,
writ or decree known to such counsel of any court or governmental agency or body
having jurisdiction over the Company or any of its subsidiaries or any of their
properties, in any manner which, in the case of clauses (A) and (B)(y), would
have a material adverse effect on the business of the Company and its
subsidiaries taken as a whole (such counsel being entitled to rely in respect of
the opinion in this clause (iv) with respect to subsidiaries upon opinions (in
form and substance satisfactory to the Agents) of counsel for the subsidiaries,
such counsel being acceptable to counsel for the Agents, copies of which shall
be furnished to each Agent, provided that such counsel shall state that he or
she believes that he or she is justified in relying upon such opinions);
(v) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body having
jurisdiction over the Company or any of its subsidiaries or any of their
properties is required for the issue and sale of the Securities or
12
the consummation by the Company of the other transactions contemplated by this
Agreement (and, if the opinion is being given pursuant to Section 4(h) hereof as
a result of the Company having entered into a Terms Agreement requiring such
opinion, the applicable Terms Agreement) or the Indenture, except such as may be
required under the Act and the Trust Indenture Act and such consents, approvals,
authorizations, registrations or qualifications as may be required under state
securities or "Blue Sky" or insurance laws;
(vi) This Agreement (and, if the opinion is being given pursuant to
Section 4(h) hereof as a result of the Company having entered into a Terms
Agreement requiring such opinion, the applicable Terms Agreement) has been duly
authorized, executed and delivered by the Company;
(vii) The Indenture has been duly authorized, executed and delivered
by the Company and (assuming the Indenture has been duly authorized, executed
and delivered by the Trustee) constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms, subject
to bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
other laws of general applicability relating to or affecting creditors' rights
and to general equity principles;
(viii) The form of the Securities to be issued has been authorized
in or pursuant to the Indenture, the Securities have been duly authorized by all
necessary action by the Board of Directors, and by the Terms and Pricing
Committee of the Board of Directors, of the Company and, when the variable terms
of the Securities have been established by any two of the authorized officers to
whom such authority has been delegated and the Securities have been executed and
authenticated as specified in the Indenture and delivered against payment of the
consideration therefor determined in accordance with this Agreement (and, if the
opinion is being given pursuant to Section 4(h) hereof as a result of the
Company having entered into a Terms Agreement requiring such opinion, in
accordance with the applicable Terms Agreement), (A) the Securities will
constitute valid and legally binding obligations of the Company, enforceable
against the Company in accordance with their terms, subject to bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other laws of
general applicability relating to or affecting creditors' rights and to general
equity principles, and (B) each holder of Securities will be entitled to the
benefits of the Indenture;
(ix) The information in the Prospectus as amended or supplemented
under the captions "Description of the Notes", "Certain United States Federal
Income Tax Considerations", and "Description of Debt Securities", or any caption
purporting to cover such matters, to the extent that such information
constitutes matters of law, summaries of legal matters, or legal conclusions,
has been reviewed by such counsel and is correct in all material respects;
(x) The Indenture is qualified under the Trust Indenture Act;
(xi) The Registration Statement is effective under the Act and, to
the best of such counsel's knowledge and information, no stop order suspending
the effectiveness of the Registration Statement has been issued under the Act
and no proceeding for that purpose has been initiated or threatened by the
Commission;
13
(xii) The Registration Statement (other than the financial
statements and supporting schedules included therein and the Statement of
Eligibility under the Trust Indenture Act filed as an exhibit thereto, as to
which no opinion need be expressed), at the time it became effective, appeared
on its face to be appropriately responsive in all material respects to the
applicable requirements of the Act, the Trust Indenture Act and the respective
rules and regulations of the Commission thereunder;
(xiii) The Company is not, and after giving effect to the issue and
sale of the Securities, will not be, an "investment company" as such term is
defined in the Investment Company Act of 1940, as amended;
(xiv) The documents incorporated by reference in the Prospectus as
amended or supplemented (other than the financial statements and supporting
schedules included therein, as to which no opinion need be expressed), when they
were filed with the Commission, complied as to form in all material respects
with the requirements of the Exchange Act and the rules and regulations
thereunder; and
(xv) Nothing has come to such counsel's attention that would lead
such counsel to believe that the Registration Statement (other than the
financial statements and supporting schedules contained or incorporated by
reference therein or omitted therefrom and the Statement of Eligibility under
the Trust Indenture Act filed as an exhibit thereto, as to which such counsel
need not comment), at the time it became effective, and if an amendment to the
Registration Statement under the Act or an annual report on Form 10-K under the
Exchange Act has been filed by the Company with the Commission subsequent to the
effectiveness of the Registration Statement, then at the time each such
amendment became effective and the most recent such Form 10-K was filed (and, if
the opinion is being given pursuant to Section 4(h) hereof as a result of the
Company having entered into a Terms Agreement requiring such opinion, as of the
date of such Terms Agreement), contained an untrue statement of a material fact
or omitted to state a material fact required to be stated therein or necessary
to make the statements therein not misleading or that the Prospectus (other than
the financial statements and supporting schedules included or incorporated by
reference therein or omitted therefrom, as to which such counsel need not
comment), as amended or supplemented at the date of this Agreement (or, if the
opinion is being given pursuant to Section 4(h) hereof, as amended or
supplemented at the date of such opinion and, if being given as a result of the
Company having entered into a Terms Agreement requiring such opinion, as amended
or supplemented at the date of such Terms Agreement and the settlement date with
respect thereto), included or includes an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
In giving such opinion, such counsel may rely as to matters of New
York law upon the opinion of Sidley Austin Brown & Wood LLP referred to in
Section 6(b).
The opinions set forth in (vii) and (viii) above may be further
limited by the inclusion of a statement to the effect that insofar as such
opinions relate to Securities denominated in a currency other than United States
dollars, the effective enforcement of a foreign currency claim in the federal or
state courts of the State of New York may be limited by
14
requirements that a claim (or a foreign currency judgement in respect of such a
claim) be converted into United States dollars at the rate of exchange
prevailing on the judgement date.
(d) At 11:00 A.M., New York City time, on the date hereof and on
any applicable date referred to in Section 4(i), the independent accountants who
have certified the financial statements of the Company and its subsidiaries
included or incorporated by reference in the Registration Statement shall have
furnished to such Agent a letter or letters, dated such applicable date, in form
and substance satisfactory to such Agent, to the effect set forth in Annex III
hereto;
(e) Since the respective dates as of which information is given in
the Prospectus, as amended or supplemented, and since the date of any applicable
Terms Agreement, there shall not have occurred any material change in or
affecting the business, properties, or financial condition of the Company or its
material subsidiaries, which, in the judgment of the Agents, materially impairs
the investment quality of the Securities;
(f) The Company shall have furnished or caused to be furnished to
such Agent a certificate of the Chairman, the President, or a Vice President and
the Treasurer or Assistant Treasurer of the Company, dated the date hereof and
any applicable date referred to in Section 4(g), in which such officers, to the
best of their knowledge after reasonable investigation, shall state that the
representations and warranties of the Company in this Agreement are true and
correct, in all material respects, as of such applicable date, that the Company
has complied with all agreements and satisfied all conditions on its part to be
performed or satisfied, in all material respects, at or prior to such applicable
date, that no stop order suspending the effectiveness of the Registration
Statement has been issued and no proceedings for that purpose have been
instituted or are threatened by the Commission, and that, since the respective
dates as of which information is given in the Prospectus, as amended or
supplemented, there has not been any Material Adverse Change, otherwise than as
set forth or contemplated in the Prospectus as amended or supplemented; and
(g) During the period between the date of any Terms Agreement and
the related Time of Delivery, there shall not have occurred any of the
following: (i) a suspension or material limitation in trading in securities
generally on the New York Stock Exchange, if the effect of any such event, in
the reasonable judgment of such Agent, is to make it impracticable or
inadvisable to proceed with the solicitation by such Agent of offers to purchase
Securities or the purchase by such Agent of Securities from the Company as
principal on the terms and in the manner contemplated by the Prospectus, as
amended or supplemented; (ii) a general moratorium on commercial banking
activities in New York declared by either Federal or New York State authorities;
(iii) the outbreak or escalation of hostilities involving the United States or
the declaration by the United States of a national emergency or war, other than
any such outbreak, escalation or declaration that does not represent a
significant departure from the conditions that exist on the date of such Terms
Agreement, if the effect of any such event in the reasonable judgment of such
Agent is to make it impracticable or inadvisable to proceed with the
solicitation by such Agent of offers to purchase Securities or the purchase of
Securities by such Agent from the Company as principal on the terms and in the
manner contemplated by the Prospectus, as amended or supplemented; (iv) the
suspension in trading in the securities of the Company on any national
securities exchange or quotation system on which they are listed or
15
quoted if the effect of such event in the reasonable judgment of such Agent is
to make it impracticable or inadvisable to proceed with the solicitation by such
Agent of offers to purchase Securities or the purchase of Securities by such
Agent from the Company as principal on the terms and in the manner contemplated
by the Prospectus, as amended or supplemented; or (v) any downgrading in the
rating accorded the Company's senior debt securities by any "nationally
recognized statistical rating organization", as that term is defined by the
Commission for purposes of Rule 436(g)(2) under the Act.
7. (a) The Company will indemnify and hold harmless each Agent
against any losses, claims, damages or liabilities, joint or several, to which
such Agent may become subject, under the Act, the Exchange Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon an untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement, the Prospectus as amended or supplemented, and any other
prospectus relating to the Securities or any amendment or supplement thereto, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse such Agent for any legal
or other expenses reasonably incurred by it in connection with investigating or
defending any such action or claim as incurred; provided, however, that the
Company shall not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Agent expressly for use in the
Prospectus as amended or supplemented; and provided, further, that with respect
to any untrue statement or omission or alleged untrue statement or omission made
in any Preliminary Prospectus, the indemnity agreement contained in this Section
7(a) shall not apply to any such losses, claims, damages or liabilities asserted
against such Agent by any purchaser of Securities to the extent that such
losses, claims, damages or liabilities result from the fact that a copy of the
Prospectus furnished by the Company (excluding any documents incorporated by
reference therein) was not sent or given to such purchaser at or prior to the
written confirmation of the sale of such Securities to such purchaser.
(b) Each Agent will indemnify and hold harmless the Company
against any losses, claims, damages or liabilities to which the Company may
become subject under the Act, the Exchange Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the Registration
Statement, the Prospectus as amended or supplemented and any other prospectus
relating to the Securities, or any amendment or supplement thereto, or arise out
of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or omission or alleged
omission was made in any Preliminary Prospectus, the Registration Statement, the
Prospectus as amended or supplemented, and any other prospectus relating to the
Securities, or any such amendment or supplement, in reliance upon and in
conformity with written information furnished to the Company by such
16
Agent expressly for use therein; and will reimburse the Company for any legal or
other expenses reasonably incurred by the Company in connection with
investigating or defending any such action or claim as incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under such subsection for any legal
expenses of other counsel or any other expenses, in each case subsequently
incurred by such indemnified party, in connection with the defense thereof other
than reasonable costs of investigation.
(d) If the indemnification provided for in this Section 7 is
unavailable to or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions in respect thereof) referred to therein, then each
indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and each Agent on the
other from the offering of the Securities to which such loss, claim, damage or
liability (or action in respect thereof) relates. If, however, the allocation
provided by the immediately preceding sentence is not permitted by applicable
law, or if the indemnified party failed to give the notice required under
subsection (c) above, then each indemnifying party shall contribute to such
amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company on the one hand and each Agent on the other in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities (or actions in respect thereof), as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and each Agent on the other shall be deemed to be in the same
proportion as the total net proceeds from the sale of Securities (before
deducting expenses) received by the Company bear to the total commissions or
discounts received by such Agent in respect thereof. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact required to be stated therein or necessary in order to make the
statements therein not misleading relates to information supplied by the Company
on the one hand or by any Agent on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and each Agent agree that it would not be
just and equitable if contribution pursuant to this subsection (d) were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to above in this
subsection (d).
17
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
in this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (d), an Agent shall not be required to contribute any amount in
excess of the amount by which the total price at which the Securities purchased
by or through it were sold exceeds the amount of any damages which such Agent
has otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) The obligations of the Company under this Section 7 shall be
in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who controls
any Agent within the meaning of the Act; and the obligations of each Agent under
this Section 7 shall be in addition to any liability which such Agent may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Company and to each person, if any, who controls the
Company within the meaning of the Act.
8. In soliciting offers by others to purchase Securities from the
Company, each Agent is acting solely as agent for the Company, and not as
principal (other than in respect of any purchase by an Agent pursuant to a Terms
Agreement). Each Agent will make reasonable efforts to assist the Company in
obtaining performance by each purchaser whose offer to purchase Securities from
the Company has been solicited by such Agent and accepted by the Company, but
such Agent shall not have any liability to the Company in the event such
purchase for any reason is not consummated. If the Company shall default on its
obligation to deliver Securities to a purchaser whose offer it has accepted, the
Company shall hold each Agent harmless against any loss, claim or damage arising
from or as a result of such default by the Company.
9. The respective indemnities, agreements, representations,
warranties and other statements by any Agent and the Company or its officers set
forth in or pursuant to this Agreement, shall remain in full force and effect
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Agent or the Company or any of its officers or
directors or any controlling person, and shall survive each delivery of and
payment for any of the Securities.
10. The provisions of this Agreement relating to the solicitation
of offers to purchase the Securities may be suspended or terminated at any time
by the Company as to any Agent or by any Agent as to such Agent upon the giving
of written notice of such suspension or termination to such Agent or the
Company, as the case may be. In the event of any such suspension or termination
with respect to any Agent, this Agreement shall remain in full force and effect
with respect to any Agent as to which such suspension or termination has not
occurred and no party shall have any liability to the other parties hereto,
except as provided in the third paragraph of Section 2(a), Section 4(d), Section
5, Section 7, Section 8 and Section 9 and except that, if at the time of such
suspension or termination, an offer for the purchase of Securities shall
18
have been accepted by the Company but the delivery of the Securities relating
thereto to the purchaser or his agent shall not yet have occurred, or any Agent
shall own any Securities purchased pursuant to a Terms Agreement with the
intention of reselling them, the Company shall have the obligations provided in
Section 4 until the delivery or resale of such Securities, but in no event for
more than nine (9) months after delivery of written notice of suspension or
termination.
11. Except as otherwise specifically provided herein or in the
Procedure, all statements, requests, notices and advices hereunder shall be in
writing, or by telephone if promptly confirmed in writing, and if to Banc of
America Securities LLC shall be sufficient in all respects when delivered or
sent by facsimile transmission or registered mail to Banc of America Securities
LLC, Bank of America Corporate Center, Mail Code NC1-007-01, 100 N. Tryon
Street, Charlotte, NC 28255, Facsimile Transmission No. (704) 388-9939,
Attention: MTN Department, and if to Banc One Capital Markets, Inc. shall be
sufficient in all respects when delivered or sent by facsimile transmission or
registered mail to Banc One Capital Markets, Inc., 1 Bank One Plaza, Suite
IL1-0463, Chicago, Illinois 60670, Facsimile Transmission No. (312) 732-3008,
Attention: MTN Desk, and if to Barclays Capital Inc. shall be sufficient in all
respects when delivered or sent by facsimile transmission or registered mail to
Barclays Capital Inc., 200 Park Avenue, New York, New York 10166, Facsimile
Transmission No. (212) 412-7305, Attention: Syndicate Desk, and if to BNP
Paribas Securities Corp. shall be sufficient in all respects when delivered or
sent by facsimile transmission or registered mail to BNP Paribas Securities
Corp., 787 Seventh Avenue, New York, New York 10019, Facsimile Transmission No.
(212) 841-3930, Attention: Syndicate Desk, and if to Deutsche Bank Securities
Inc. shall be sufficient in all respects when delivered or sent by facsimile
transmission or registered mail to Deutsche Bank Securities Inc., 31 West 52nd
Street, New York, New York 10019, Facsimile Transmission No. (212) 469-7505,
Attention: Debt Capital Markets, and if to Goldman, Sachs & Co. shall be
sufficient in all respects when delivered or sent by facsimile transmission or
registered mail to Goldman, Sachs & Co., 85 Broad Street, New York, New York
10004, Facsimile Transmission No. (212) 363-7609, Attention: Credit Department,
and if to J.P. Morgan Securities Inc. shall be sufficient in all respects when
delivered or sent by facsimile transmission or registered mail to J.P. Morgan
Securities Inc., 270 Park Avenue, 9th Floor, New York, New York 10017, Facsimile
Transmission No. (212) 834-6702, Attention: Transaction Execution Group, and if
to Morgan Stanley & Co. Incorporated shall be sufficient in all respects when
delivered or sent by facsimile transmission or registered mail to Morgan Stanley
& Co. Incorporated, 1585 Broadway, 2nd Floor, New York, New York 10036,
Facsimile Transmission No. (212) 761-0780, Attention: Manager - Continuously
Offered Products, with a copy to: Morgan Stanley & Co. Incorporated, 1585
Broadway, 29th Floor, New York, New York 10036, Attention: Peter Cooper -
Investment Banking Information Center, Facsimile Transmission No. (212)
761-0260, and if to Salomon Smith Barney Inc. shall be sufficient in all
respects when delivered or sent by facsimile transmission or registered mail to
Salomon Smith Barney Inc., 388 Greenwich Street, New York, New York 10013,
Facsimile Transmission No. (212) 816-0949, Attention: Medium-Term Note
Department, and if to Wachovia Securities, Inc. shall be sufficient in all
respects when delivered or sent by facsimile transmission or registered mail to
Wachovia Securities, Inc., One Wachovia Center, TW-8, 301 South College Street,
Charlotte, North Carolina 28288-0602, Facsimile Transmission No. (704) 383-9165,
Attention: Debt Capital Markets, and if to the Company shall be sufficient in
all respects when delivered or sent by facsimile transmission or registered mail
to 601 N.W. Second Street, Evansville, Indiana
19
47708, Facsimile Transmission No.(812) 468-5352, Attention: Treasurer, or at
such other address as any of such parties may designate from time to time by
notice duly given in accordance with this Section 11.
12. This Agreement and any Terms Agreement shall be binding upon,
and inure solely to the benefit of, each Agent which is a party hereto or
thereto and the Company and their respective successors, and to the extent
provided in Section 7 and Section 9 hereof, the officers and directors of the
Company and any person who controls any Agent or the Company, and their
respective personal representatives, successors and assigns, and no other person
shall acquire or have any right under or by virtue of this Agreement or any
Terms Agreement. No purchaser of any of the Securities through or from any Agent
hereunder shall be deemed a successor or assign by reason of such purchase.
13. This Agreement and any Terms Agreement shall be governed by,
and construed in accordance with, the laws of the State of New York.
14. Time shall be of the essence in this Agreement and any Terms
Agreement.
15. This Agreement and any Terms Agreement may be executed by any
one or more of the parties hereto and thereto in any number of counterparts,
each of which shall be an original, but all of such respective counterparts
shall together constitute one and the same instrument.
20
If the foregoing is in accordance with your understanding, please
sign and return to us four counterparts hereof, whereupon this letter and the
acceptance by each of you thereof shall constitute a binding agreement between
the Company and each of you in accordance with its terms.
Very truly yours,
AMERICAN GENERAL FINANCE CORPORATION
By
----------------------------------
Name:
Title:
By
----------------------------------
Name:
Title:
21
Accepted in New York, New York,
as of the date hereof:
Banc of America Securities LLC
By
-------------------------------------------------
Name:
Title:
Banc One Capital Markets, Inc.
By
-------------------------------------------------
Name:
Title:
Barclays Capital Inc.
By
-------------------------------------------------
Name:
Title:
BNP Paribas Securities Corp.
By
-------------------------------------------------
Name:
Title:
Deutsche Bank Securities Inc.
By
-------------------------------------------------
Name:
Title:
Goldman, Sachs & Co.
By
-------------------------------------------------
Name:
Title:
J.P. Morgan Securities Inc.
By
-------------------------------------------------
Name:
Title:
Morgan Stanley & Co. Incorporated
By
-------------------------------------------------
Name:
Title:
Salomon Smith Barney Inc.
By
-------------------------------------------------
Name:
Title:
Wachovia Securities, Inc.
By
-------------------------------------------------
Name:
Title:
22
ANNEX I
American General Finance Corporation
Medium-Term Notes, Series H
Terms Agreement
[Date]
[Name(s) and Address(es) of Agent(s)]
Ladies and Gentlemen:
American General Finance Corporation (the "Company") proposes,
subject to the terms and conditions stated herein and in the Distribution
Agreement, dated November 14, 2002 (the "Distribution Agreement"), between the
Company on the one hand and the agents which are parties thereto (individually,
an "Agent" and collectively, the "Agents") on the other, to issue and sell to
[Name(s) of Agent(s)] (the "Purchasing Agent[s]") the securities specified in
the Schedule hereto (the "Purchased Securities"). Each of the provisions of the
Distribution Agreement not specifically related to the solicitation by the
Agents, as agents of the Company, of offers to purchase Securities is
incorporated herein by reference in its entirety, and shall be deemed to be part
of this Terms Agreement to the same extent as if such provisions had been set
forth in full herein. Nothing contained herein or in the Distribution Agreement
shall make any party hereto an agent of the Company or make such party subject
to the provisions in the Distribution Agreement relating to the solicitation of
offers to purchase Securities from the Company, solely by virtue of its
execution of this Terms Agreement. Each of the representations and warranties
set forth in the Distribution Agreement shall be deemed to have been made at and
as of the date of this Terms Agreement, except that each representation and
warranty in Section 1 of the Distribution Agreement which makes reference to the
Prospectus shall be deemed to be a representation and warranty as of the date of
the Distribution Agreement in relation to the Prospectus (as therein defined),
and also a representation and warranty as of the date of this Terms Agreement in
relation to the Prospectus as amended or supplemented to relate to the Purchased
Securities.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Purchased Securities, in the
form attached hereto as an Exhibit is now proposed to be filed with the
Commission. It shall be a condition to closing that after the date of this Terms
Agreement and prior to the Time of Delivery specified in the Schedule hereto,
there shall not have occurred any material change in or affecting the business,
properties, or financial condition of the Company or its material subsidiaries
which, in your judgment, materially impairs the investment quality of the
Securities.
Subject to the terms and conditions set forth herein and in the
Distribution Agreement incorporated herein by reference, the Company agrees to
issue and sell to the Purchasing Agent[s] and the Purchasing Agent[s] agree[s]
to purchase from the Company [,
Annex I - 1
severally and not jointly,] the Purchased Securities, at the time and place, in
the principal amount and currency and at the purchase price set forth in the
Schedule hereto.
If the foregoing is in accordance with your understanding, please
sign and return to us [___] counterparts hereof, and upon acceptance hereof by
you this letter and such acceptance hereof, including those provisions of the
Distribution Agreement incorporated herein by reference, shall constitute a
binding agreement between you and the Company.
American General Finance Corporation
By:________________________________
Name:
Title:
By:________________________________
Name:
Title:
Accepted:
[Name(s) of Agent(s)]
By:_________________________
Name:
Title:
Annex I - 2
Schedule to Annex I
Title of Purchased Securities: Medium-Term Notes, Series H
Form of Securities: [Book-Entry][Certificated]
Currency/Aggregate Principal Amount: [U.S. dollars;] $__________
[Principal Amount by [Name of each $__________
Agent:]
[Price to Public:] ____% of the principal amount of the
Purchased Securities[, plus accrued
interest from ______ to ______] [and
accrued amortization, if any, from ______
to ______]
Purchase Price by Purchasing Agent(s): ____% of the principal amount of the
Purchased Securities[, plus accrued
interest from ______ to ______] [and
accrued amortization, if any, from ______
to ______]
Method of and Specified Funds for [By wire transfer to a bank account
Payment of Purchase Price: specified by the Company in immediately
available funds]
Indenture: Indenture, dated as of May 1, 1999, between
the Company and Citibank, N.A., as Trustee
Time of Delivery:
Closing Location for Delivery of Securities:
Maturity:
If Fixed Rate Note - Interest Rate: ____%
Interest Payment Dates: [months and dates]
Regular Record Dates: [months and dates]
If other than Fixed Rate Note: See form of Pricing Supplement attached hereto
Documents to be Delivered: [The following documents referred to in the
Distribution Agreement shall be delivered
as a condition to the Closing:
1. The officers' certificate referred to in
Section 4(g).
2. The opinion of counsel to the Company
referred to in Section 4(h).
3. The accountants' letter referred to in
Section 4(i).]
Default Provisions:
Other:
Annex I - 3
ANNEX II
American General Finance Corporation
Medium-Term Notes, Series H
Administrative Procedure
Dated as of November 14, 2002
Medium-Term Notes, Series H (the "Notes") in the aggregate principal
amount of up to $5,750,000,000, or its equivalent in foreign currencies,
including the Euro, or any composite currency, are to be offered on a continuing
basis by American General Finance Corporation (the "Company") through agents
which, as agents (each an "Agent", and, collectively, the "Agents"), have agreed
to use their best efforts to solicit and receive offers to purchase the Notes
from the Company. The Agents may also purchase Notes as principal for resale.
The Notes will be sold pursuant to the Distribution Agreement among the
Company and the Agents, dated as of November 14, 2002 (the "Distribution
Agreement"). The Notes will be issued pursuant to the Indenture (the
"Indenture"), dated as of May 1, 1999, between the Company and Citibank, N.A.,
as trustee (the "Trustee").
The Registration Statement (as defined in the Distribution Agreement) with
respect to the Notes has been filed with the Securities and Exchange Commission
(the "Commission"). The most recent basic Prospectus included in the
Registration Statement, as supplemented with respect to the Notes, is herein
referred to as the "Prospectus Supplement". The most recent supplement to the
Prospectus Supplement with respect to the terms of specific Notes is herein
referred to as the "Pricing Supplement".
The Notes will bear interest at fixed rates ("Fixed Rate Notes") or at
rates determined by reference to selected indices ("Floating Rate Notes", which
term shall include any Note bearing interest with reference to both a floating
rate and a fixed rate), and will be issued only in fully registered form and
either in (a) book-entry form (each a "Book-Entry Note") delivered to the
Trustee, as agent for The Depository Trust Company ("DTC"), and recorded in the
book-entry system maintained by DTC, or (b) certificated form delivered to the
purchaser thereof or a person designated by such purchaser (each a "Certificated
Note"). Owners of beneficial interests in Book-Entry Notes will be entitled to
physical delivery of Certificated Notes equal in principal amount to their
respective beneficial interests only under certain limited circumstances
described in the Prospectus Supplement. The Trustee will be the paying agent
with respect to the Notes.
General procedures relating to the issuance of all Notes are set forth in
Part I hereof. Additionally, Book-Entry Notes will be issued in accordance with
the procedures set forth in Part II hereof and Certificated Notes will be issued
in accordance with the procedures set forth in Part III hereof. Capitalized
terms used herein that are not otherwise defined herein shall have the meanings
ascribed thereto in the Indenture, the Distribution Agreement or the Notes, as
the case may be.
Annex II - 1
PART I: PROCEDURES OF GENERAL APPLICABILITY
Date of Issuance/ Each Note will be dated and issued as of the
Authentication: date of its authentication by the Trustee.
Each Note shall also bear an original issue date
(the "Original Issue Date"). The Original Issue Date
shall remain the same for all Notes subsequently
issued upon transfer, exchange or substitution of an
original Note regardless of their dates of
authentication.
Maturities: Each Note will mature on a date selected by
the initial purchaser and agreed to by the
Company which is nine months or more from its
Original Issue Date.
Denominations: The Notes will be issued in denominations of
$1,000 and integral multiples of $1,000 in
excess thereof. If the Notes are denominated
in a currency other than United States
dollars, the denominations of such Notes will
be determined pursuant to the provisions of
the applicable Pricing Supplement.
Registration: Notes will be issued only in fully registered
form.
Redemption/Repayment: The Notes will be subject to repayment at the
option of the Holders thereof in accordance
with the terms of the Notes on their
respective Optional Repayment Dates, if any.
Optional Repayment Dates, if any, will be
fixed at the time of sale and set forth in the
applicable Pricing Supplement and in the
applicable Note. If no Optional Repayment
Dates are indicated with respect to a Note,
such Note will not be repayable at the option
of the Holder prior to Stated Maturity.
The Notes will be subject to redemption by the
Company on and after their respective Initial
Redemption Date, if any. An Initial Redemption Date,
if any, will be fixed at the time of sale and set
forth in the applicable Pricing Supplement and in
the applicable Note. If no Initial Redemption Date
is indicated with respect to a Note, such Note will
not be redeemable prior to Stated Maturity.
Annex II - 2
Interest: General. Each Note will accrue interest from
and including the most recent Interest Payment
Date to which interest has been paid or duly
provided for or, if no interest has been paid
or duly provided for, from and including the
Original Issue Date. Each payment of interest
on a Note will include interest accrued
through the day preceding, as the case may be,
the Interest Payment Date, Stated Maturity,
Redemption Date or Optional Repayment Date
(each Stated Maturity, Redemption Date or
Optional Repayment Date is referred to herein
as a "Maturity"). Interest on a Note will be
payable to the person in whose name the Note
is registered at the close of business on the
Regular Record Date next preceding the
applicable Interest Payment Date; provided,
however, that interest payable at Maturity of
a Note will be payable to the Person to whom
the principal of such Note is payable.
Regular Record Dates. Unless otherwise specified in
an applicable Pricing Supplement, the Regular Record
Date with respect to any Interest Payment Date on
Fixed Rate Notes or Floating Rate Notes shall be the
date 15 calendar days (whether or not a Business
Day) preceding such Interest Payment Date.
Interest Payments. Unless otherwise specified in an
applicable Pricing Supplement, interest payments on
Fixed Rate Notes will be made semiannually on March
1 and September 1 of each year and at Maturity.
Interest payments on Floating Rate Notes will be
made as specified in the applicable Floating Rate
Note.
Interest payments will be made on each Interest
Payment Date commencing with the first Interest
Payment Date following the Original Issue Date;
provided, however, that the first payment of
interest on any Note originally issued after a
Regular Record Date and on or before the immediately
following Interest Payment Date will occur on the
Interest Payment Date immediately following the next
Regular Record Date.
Annex II - 3
Legal Holidays: Any payment of principal, premium, if any, or
interest required to be made on an Interest
Payment Date or at Maturity of a Note which is
not a Business Day need not be made on such
day, but may be made on the next succeeding
Business Day with the same force and effect as
if made on the Interest Payment Date or at
Maturity, as the case may be, and no interest
shall accrue for the period from and after
such Interest Payment Date or Maturity, except
that in the case of a payment of interest
required to be made on an Interest Payment
Date, if such Note is a LIBOR Note and such
succeeding Business Day falls in the next
calendar month, such payment shall be made on
the immediately preceding Business Day with
respect to such LIBOR Note.
Calculation of Interest: With respect to Fixed Rate Notes, interest
(including payments for partial periods) will
be calculated and paid on the basis of a
360-day year consisting of twelve 30-day
months. Interest does not accrue on the 31st
day of any month. With respect to Floating
Rate Notes, interest will be calculated and
paid on the basis of the actual number of days
in the interest period divided by 360 days for
Notes for which the CD Rate, the Commercial
Paper Rate, the Eleventh District Cost of
Funds Rate, the Prime Rate, LIBOR, the Federal
Funds Open Rate, or the Federal Funds Rate is
an applicable Interest Rate Basis, and on the
basis of the actual number of days in the
interest period divided by the actual number
of days in the year, for Notes for which the
CMT Rate or the Treasury Rate is an applicable
Interest Rate Basis.
Acceptance and Rejection The Company shall have the sole right to
of Offers: accept offers to purchase Notes from the
Company and may reject any such offer in whole or in
part. Each Agent shall communicate to the Company,
orally or in writing, each reasonable offer to
purchase Notes from the Company received by it. Each
Agent shall have the right, in its discretion
reasonably exercised, without notice to the Company,
to reject any offer to purchase Notes through it in
whole or in part.
Annex II - 4
Preparation of Pricing If any offer to purchase a Note is accepted by
Supplement: the Company, the Company, with the approval of
the Agent which presented the offer (the "Presenting
Agent"), will prepare a Pricing Supplement
reflecting the terms of such Note and file such
Pricing Supplement with the Commission in accordance
with Rule 424 of the Securities Act of 1933, as
amended.
The Presenting Agent will affix the Pricing
Supplement to the Prospectus Supplement and cause
such document to be delivered to the purchaser of
the Note. In addition, one copy of such Pricing
Supplement will be delivered to the Presenting Agent
by telecopy or overnight express (for delivery not
later than 11:00 A.M. on the Business Day next
following the trade date), as follows:
If to Banc of America Securities LLC:
Banc of America Securities LLC
Bank of America Corporate Center
100 North Tryon Street, 7th Floor
Mail Code NC1-007-07-01
Attention: MTN Department
Charlotte, North Carolina 28255
Telecopy: 704-388-9939
and to:
Lily Chang
Banc of America Securities LLC
9 West 57th Street, 31st Floor
New York, New York 10019
If to Banc One Capital Markets, Inc.:
Banc One Capital Markets
1 Bank One Plaza, Suite IL-0463
Attention: MTN Desk
Chicago, Illinois 60670
Annex II - 5
If to Barclays Capital Inc.
Barclays Capital Inc.
200 Park Avenue
New York, New York 10166
Attention: Transaction Management
Telecopy: 212-412-7680
and to:
Barclays Capital
c/o ADP Prospectus
1155 Long Island Avenue
Edgewood, New York 11717
Attention: Ivan Flores
Telecopy: 631-254-7140
If to BNP Paribas Securities Corp.:
BNP Paribas Securities Corp.
787 Seventh Avenue, 8th Floor
New York, New York 10019
Attention: Fixed Income Syndicate Desk
Telecopy: 212-841-3930
If to Deutsche Bank Securities Inc.:
Deutsche Bank Securities Inc.
31 West 52nd Street
3rd Floor - Debt Capital Markets
New York, New York 10019
Attention: Josh Witz
Telecopy: 212-469-7505
If to Goldman, Sachs & Co.
Goldman, Sachs & Co.
85 Broad Street, 9th Floor
New York, New York 10004
Attention: Debra Laidlow-Lewis
Telecopy: 212-902-6276
Annex II - 6
If to J.P. Morgan Securities Inc.
J.P. Morgan Securities Inc.
270 Park Avenue, 8th Floor
New York, New York 10017
Attention: Medium-Term Note Desk
Telephone: 212-834-4421
Telecopy: 212-834-6081
If to Morgan Stanley & Co. Incorporated
Morgan Stanley & Co. Incorporated
1585 Broadway, 2nd Floor
New York, New York 10036
Attention: Medium Term Note Trading Desk
Telephone: 212-761-1322
Telecopy: 212-761-8846
If to Salomon Smith Barney Inc.:
Salomon Smith Barney Inc.
Medium-Term Note Department
388 Greenwich Street
New York, New York 10013
Telephone: 212-816-5831
Telecopy: 212-816-0949
and to:
Salomon Smith Barney Inc.
Attention: Annabelle Avila
Brooklyn Army Terminal
140 58th Street, 8th Floor
Brooklyn, New York 11220
Telephone: 718-765-6725
Telecopy: 718-765-6734
Annex II - 7
If to Wachovia Securities, Inc.:
Wachovia Securities, Inc.
One Wachovia Center, TW-8
301 South College Street
Charlotte, North Carolina 28288-0602
Attention: MTN Syndicate Desk
Telephone: 704-383-7727
Telecopy: 704-383-9165
With a copy in each case to:
Sidley Austin Brown & Wood LLP
787 Seventh Avenue
New York, New York 10019
Attention: John H. Newman, Esq.
Outdated Pricing Supplements and the Prospectus
Supplement to which they are attached (other than
those retained for files) will be destroyed.
Settlement: The receipt of immediately available funds by
the Company in payment for a Note and the
authentication and delivery of such Note
shall, with respect to such Note, constitute
"settlement". Offers accepted by the Company
will be settled three Business Days after
acceptance, or at such other time as the
purchaser and the Company shall agree,
pursuant to the timetable for settlement set
forth in Parts II and III hereof under
"Settlement Procedures" with respect to
Book-Entry Notes and Certificated Notes,
respectively (each such date fixed for
settlement is hereinafter referred to as a
"Settlement Date"). If procedures A and B of
the applicable Settlement Procedures with
respect to a particular offer are not
completed on or before the time set forth
under the applicable "Settlement Procedures
Timetable", such offer shall not be settled
until the Business Day following the
completion of settlement procedures A and B or
such later date as the purchaser and the
Company shall agree.
In the event of a purchase of Notes by any Agent as
principal, appropriate settlement details will be as
agreed between such Agent and the Company pursuant
to the applicable Terms Agreement
Annex II - 8
Procedure for When a decision has been reached to change
Changing Rates or the interest rate or any other variable term
Other Variable Terms: on any Notes being sold by the Company, the
Company will promptly advise the Agents and the
Agents will forthwith suspend solicitation of
offers to purchase such Notes. The Agents may
telephone the Company with recommendations as to
the changed interest rates or other variable terms.
At such time as the Company advises the Agents of
the new interest rates or other variable terms, the
Agents may resume solicitation of offers to
purchase such Notes. Until such time only
"indications of interest" may be recorded.
Immediately after acceptance by the Company of an
offer to purchase Notes at a new interest rate or
new variable term, the Company, the Presenting
Agent and the Trustee shall follow the procedures
set forth under the applicable "Settlement
Procedures".
Suspension of Solicitation: The Company may instruct the Agents to suspend
solicitation of offers to purchase Notes at any
time. Upon receipt of such instructions, each Agent
will forthwith suspend solicitation of offers to
purchase from the Company until such time as the
Company has advised such Agent that solicitation of
offers to purchase may be resumed.
In the event that at the time the solicitation of
offers to purchase Notes from the Company is
suspended (other than to change interest rates or
other variable terms) there shall be any offers to
purchase Notes that have been accepted by the
Company which have not been settled, the Company
will promptly advise the appropriate Agent and the
Trustee whether such offers may be settled and
whether copies of the Prospectus Supplement as
theretofore amended and/or supplemented as in
effect at the time of the suspension may be
delivered in connection with the settlement of such
offers. The Company will have the sole
responsibility for such decision and for any
arrangements which may be made in the event that
the Company determines that such offers may not be
settled or that copies of such Prospectus
Supplement may not be so delivered.
Annex II - 9
Delivery of Prospectus: A copy of the most recent Prospectus Supplement
together with the applicable Pricing Supplement
must accompany or precede the earlier of (a) the
written confirmation of a sale sent to a purchaser
or its agent and (b) the delivery of Notes to a
purchaser or its agent.
Authenticity of The Agents will have no obligations or
Signatures: liability to the Company or the Trustee in
respect of the authenticity of the signature
of any officer, employee or agent of the
Company or the Trustee on any Note.
Documents Incorporated by The Company shall supply each Agent with an
Reference: adequate supply of all documents incorporated
by reference in the Registration Statement.
Business Day and London "Business Day" means any day, other than a
Business Day: Saturday or Sunday, that is neither a legal
holiday nor a day on which commercial banks are
authorized or required by law, regulation or
executive order to close in The City of New York;
provided, however, that, with respect to Notes
denominated in a currency other than U.S. dollars,
the day must also not be a day on which commercial
banks are authorized or required by law, regulation
or executive order to close in the Principal
Financial Center of the country issuing the
specified currency (or, if the specified currency
is Euro, the day must also be a day on which the
Trans-European Automated Real-Time Gross Settlement
Express Transfer (TARGET) System is open);
provided, further, that, with respect to notes as
to which LIBOR is an applicable interest rate
basis, the day must also be a London Business Day.
"London Business Day" means a day on which
commercial banks are open for business (including
dealings in the LIBOR Currency) in London.
"Principal Financial Center" means, as applicable,
the capital city of the country issuing the
specified currency; or the capital city of the
country to which the LIBOR Currency relates;
provided, however, that with respect to United
States dollars, Australian dollars, Canadian
dollars, Euro, South African rand and Swiss francs,
the "Principal Financial Center" shall be The City
of New York, Sydney, Toronto, London, Johannesburg
and Zurich, respectively.
Annex II - 10
PART II: PROCEDURES FOR NOTES ISSUED IN BOOK-ENTRY FORM
In connection with the qualification of Notes issued in book-entry form
for eligibility in the book-entry system maintained by DTC, the Trustee will
perform the custodial, document control and administrative functions described
below, in accordance with its obligations under the Letter of Representations
from the Company and the Trustee to DTC and the Medium-Term Note Certificate
Agreement between the Trustee and DTC (the "Certificate Agreement"), and its
obligations as a participant in DTC, including DTC's Same-Day Funds Settlement
System ("SDFS").
Issuance: All Fixed Rate Notes issued in book-entry
form having the same Original Issue Date,
interest rate, Maturity and other terms
(collectively, the "Fixed Rate Terms") will
be represented initially by a single
Book-Entry Note and all Floating Rate Notes
issued in book-entry form having the same
interest rate basis, bases or formula,
Original Issue Date, Initial Interest Rate,
Interest Payment Dates, Index Maturity,
Interest Reset Dates, Spread and/or Spread
Multiplier, if any, maximum and/or minimum
interest rate limitations, if any, Maturity
and other terms (collectively, the "Floating
Rate Terms") will be represented initially
by a single Book-Entry Note.
Identification: The Company has arranged with the CUSIP Service
Bureau of Standard & Poor's Ratings Services (the
"CUSIP Service Bureau") for the reservation of
CUSIP numbers which have been reserved for
assignment to Book-Entry Notes. The Company has
delivered to the Trustee and DTC a list of such
CUSIP numbers. The Trustee will assign CUSIP
numbers to Book-Entry Notes as described below
under Settlement Procedure B. DTC will notify the
CUSIP Service Bureau periodically of the CUSIP
numbers that the Trustee has assigned to
Book-Entry Notes. At any time when fewer than 100
of the CUSIP numbers remain unassigned, the
Trustee will so notify the Company and the
Company, if it deems necessary, will reserve
additional CUSIP numbers for assignment to
Book-Entry Notes. Upon obtaining such additional
CUSIP numbers, the Company will deliver a list of
such additional numbers to the Trustee and DTC.
Book-Entry Notes having an aggregate principal
amount in excess of $500,000,000 and otherwise
Annex II - 11
required to be represented by a single Book-Entry
Note will instead be represented by two or more
Book-Entry Notes which shall all be assigned the
same CUSIP number.
Registration: Each Book-Entry Note will be registered in the
name of Cede & Co., as nominee for DTC, on the
register maintained by the Trustee under the
Indenture. The beneficial owner of a Note issued
in book-entry form (i.e., an owner of a beneficial
interest in a Book-Entry Note) (or one or more
indirect participants in DTC designated by such
owner) will designate one or more participants in
DTC (with respect to such Note issued in
book-entry form, the "Participants") to act as
agent for such beneficial owner in connection with
the book-entry system maintained by DTC, and DTC
will record in book-entry form, in accordance with
instructions provided by such Participants, a
credit balance with respect to such Note issued in
book-entry form in the account of such
Participants. The ownership interest of such
beneficial owner in such Note issued in book-entry
form will be recorded through the records of such
Participants or through the separate records of
such Participants and one or more indirect
participants in DTC.
Transfers: Transfers of the beneficial interest in 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 Book-Entry Note.
Exchanges: If requested to do so by the Company, at the
Company's sole election, the Trustee may
deliver to DTC and the CUSIP Service Bureau
at any time a written notice specifying (a)
the CUSIP numbers of two or more Book-Entry
Notes Outstanding on such date that
represent Book-Entry Notes having the same
Fixed Rate Terms or Floating Rate Terms, as
the case may be (other than Original Issue
Dates), and for which interest has been paid
to the same date; (b) a date, occurring at
least 30 days after such written notice is
delivered and at least 30 days before the
next Interest Payment Date for the related
Annex II - 12
Notes issued in book-entry form, on which
such Book-Entry Notes shall be exchanged for
a single replacement Book-Entry Note; and
(c) a new CUSIP number to be assigned to
such replacement Book-Entry Note. Upon
receipt of such a notice, DTC will send to
its Participants (including the Trustee) a
written reorganization notice to the effect
that such exchange will occur on such date.
Prior to the specified exchange date, the
Trustee will deliver to the CUSIP Service
Bureau a written notice setting forth such
exchange date and the new CUSIP number and
stating that, as of such exchange date, the
CUSIP numbers of the Book-Entry Notes to be
exchanged will no longer be valid. On the
specified exchange date, the Trustee will
exchange such Book-Entry Notes for a single
Book-Entry Note bearing the new CUSIP number
and the CUSIP numbers of the exchanged
Book-Entry Notes will, in accordance with
CUSIP Service Bureau procedures, be canceled
and not immediately reassigned.
Notwithstanding the foregoing, if the
Book-Entry Notes to be exchanged exceed
$500,000,000 in aggregate principal amount,
one replacement Book-Entry Note will be
authenticated and issued to represent
$500,000,000 principal amount of the
exchanged Book-Entry Notes and an additional
Book-Entry Note or Notes will be
authenticated and issued to represent any
remaining principal amount of such
Book-Entry Notes (See "Denominations" below).
Denominations: Book-Entry Notes will be denominated in
principal amounts not in excess of
$500,000,000. If one or more Notes issued
in book-entry form having an aggregate
principal amount in excess of $500,000,000
would, but for the preceding sentence, be
represented by a single Book-Entry Note,
then one Book-Entry Note will be issued to
represent $500,000,000 principal amount of
such Note or Notes issued in book-entry form
and an additional Book-Entry Note or Notes
will be issued to represent any remaining
principal amount of such Note or Notes
issued in book-entry form. In such a case,
each of the Book-Entry Notes representing
such Note or Notes issued in book-entry form
shall be assigned the same CUSIP number.
Annex II - 13
Payments of Principal Payments of Interest Only. Promptly after
and Interest: each Regular Record Date, (i) the Trustee
will deliver to the Company and DTC a written
notice specifying by CUSIP number the amount of
interest to be paid on each Book-Entry Note that
is a Fixed Rate Note and the total of such
amounts, and (ii) the Calculation Agent will
deliver to the Company, the Trustee and DTC a
written notice specifying by CUSIP number the
amount of interest to be paid on each Book-Entry
Note that is a Floating Rate Note and the total of
such amounts, on the following Interest Payment
Date (other than an Interest Payment Date
coinciding with Maturity). DTC will confirm the
amount payable on each Book-Entry Note on such
Interest Payment Date by reference to the daily
bond reports published by Standard & Poor's
Ratings Services. On such Interest Payment Date,
the Company will pay to the Trustee such total
amount of interest due (other than at Maturity) at
the times and in the manner set forth below under
"Manner of Payment" and the Trustee will in turn
pay such amounts as set forth below under "Manner
of Payment".
Notice of Interest Rates. Promptly after each
Interest Determination Date for Floating Rate
Notes issued in book-entry form, the Trustee will
notify Standard & Poor's Ratings Services of the
interest rates determined on such Interest
Determination Date.
Payment at Maturity. On or about the first
Business Day of each month, the Trustee will
deliver to the Company and DTC a written list of
principal, interest and premium, if any, to be
paid on each Book-Entry Note maturing (either at
Stated Maturity or on a Redemption Date or
Optional Repayment Date) in the following month.
The Trustee, the Company and DTC will confirm the
amounts of such principal and interest payments
with respect to a Book-Entry Note on or about the
fifth Business Day preceding the Maturity of such
Book-Entry Note. At such Maturity, the Company
will pay to the Trustee the principal amount of
such Note, together with interest and premium, if
any, due at such Maturity, at the times and in the
manner set forth below under "Manner of Payment"
and the Trustee will in turn
Annex II - 14
pay such amounts as set forth below under "Manner
of Payment". Promptly after payment to DTC of the
principal, interest and premium, if any, due at
the Maturity of such Book-Entry Note, the Trustee
will cancel and destroy such Book-Entry Note and
deliver a certificate of destruction with respect
to such Book-Entry Note to the Company with an
appropriate debit advice. On the first Business
Day of each month, the Trustee will deliver to the
Company a written statement indicating the total
principal amount of Outstanding Book-Entry Notes
as of the close of business on the immediately
preceding Business Day.
Manner of Payment. The total amount of any
principal, premium and interest due on Book-Entry
Notes on any Interest Payment Date or at Maturity
shall be paid by the Company to the Trustee in
funds available for use by the Trustee as of 9:30
a.m. New York City time on such date. Prior to
10:00 a.m. New York City time on such date, or as
soon as possible thereafter following receipt of
funds from the Company, the Trustee will pay by
separate wire transfer (using Fedwire message
entry instructions in a form previously specified
by DTC) to an account at the Federal Reserve Bank
of New York previously specified by DTC, in funds
available for immediate use by DTC (or by any
other method of payment satisfactory to both the
Trustee and DTC), each payment of interest,
principal and premium, if any, due on a Book-Entry
Note on such date and payable in U.S. dollars.
Thereafter on such date, DTC will pay, in
accordance with its SDFS operating procedures then
in effect, such amounts in funds available for
immediate use to the respective Participants in
whose names such Notes to be paid in U.S. dollars
are recorded in the book-entry system maintained
by DTC. Neither the Company nor the Trustee shall
have any responsibility or liability for the
payment by DTC of the principal of, or any premium
or interest on, the Book-Entry Notes to such
Participants.
Unless otherwise specified in the applicable
Prospectus Supplement, if an issue of Notes is
denominated in a currency other than the United
States dollar, the Company will make payments of
Annex II - 15
principal and any interest in the currency in
which the Notes are denominated (the "foreign
currency"). Unless the Holder of a Note elects to
receive payments in the foreign currency, the
Exchange Rate Agent will convert the foreign
currency amount into United States dollars. DTC
has elected to receive all such payments of
principal and interest in United States 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 or at least 12 calendar days
prior to the date for payment of principal, as the
case may be, such Participant must 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 Trustee on or prior to the
fifth Business Day after the record date for
payment of interest or at least ten calendar days
prior to the date for payment of principal, as the
case may be, of the portion of such payment to be
received in the foreign currency and the
applicable wire transfer instructions, and the
Trustee shall use such instructions to pay the
Participants directly. If DTC does not so notify
the Trustee, it is understood that only United
States dollar payments are to be made.
The Trustee shall notify DTC on or prior to the
second Business Day prior to the payment date of
the conversion rate to be used and the resulting
United States dollar amount to be paid per $1,000
face amount. In the event that the required
quotations to convert the foreign currency into
United States dollars are not available, the
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 Trustee and the Trustee
shall use such instructions to pay the
Participants directly.
Annex II - 16
Withholding Taxes. The amount of any taxes
required under applicable law to be withheld from
any interest payment on a Note will be determined
and withheld by the Participant, indirect
participant in DTC or other Person responsible for
forwarding payments and materials directly to the
beneficial owner of such Note.
Settlement Procedures: Settlement Procedures with regard to each
Book-Entry Note sold by the Company through an
Agent will be as follows:
A. The Presenting Agent will advise the
Company by telephone or telecopy of
the following settlement information:
1. Taxpayer identification number of the
purchaser.
2. Principal amount of the Note and
specified currency.
3. Fixed Rate Notes:
a) Interest Rate, and
b) Whether such Note is being
issued with original issue
discount and, if so, the terms
thereof.
Floating Rate Notes:
a) Interest Rate Basis(es),
(i) If LIBOR, LIBOR Reuters or LIBOR
Moneyline Telerate,
(ii) If CMT Rate, the CMT Moneyline
Telerate Page,
(iii) If CMT Moneyline Telerate Page 7052,
Weekly Average or
Annex II - 17
Monthly Average,
b) Initial Interest Rate, if any,
c) Spread and/or Spread Multiplier, if
any,
d) Initial Interest Reset Date,
e) Interest Reset Date(s),
f) Interest Payment Date(s),
g) Index Maturity,
h) Maximum and/or minimum interest rates,
if any,
i) Calculation Date,
j) Interest Determination Dates,
k) Type of Floating Rate Note (i.e.
Regular Floating Rate
Note, Floating Rate/Fixed
Rate Note or Inverse
Floating Rate Note),
l) Fixed Rate Commencement Date, if any,
m) Fixed Interest Rate, if any, and
n) Day Count Convention.
4. Purchase Price (_____%, plus accrued
interest, if any, from ___________).
5. Price to public of the Note (_____%,
plus accrued interest, if any, from ___________).
6. Trade date.
7. Settlement Date and Time.
8. Stated Maturity.
Annex II - 18
9. Original Issue Date.
10. Redemption provisions, if any,
including: Initial Redemption
Date, Initial Redemption
Percentage and Annual Redemption
Percentage Reduction.
11. Optional Repayment Date(s), if any.
12. Net proceeds to the Company.
13. Presenting Agent's commission.
14. Name of Presenting Agent.
15. Other provisions, if any.
B. The Company will advise the Trustee by
electronic means, telephone (confirmed
in writing by an authorized
representative of the Company at any
time on the same date) or telecopy of
the information set forth in
Settlement Procedure "A" above. The
Trustee, on behalf of the Company,
will assign a CUSIP number to the
Book-Entry Note and will notify the
Company by telephone of such CUSIP
number as soon as practicable.
C. The Trustee will communicate to DTC
and the Presenting Agent through DTC's
Participant Terminal System a pending
deposit message specifying the
following settlement information (and
DTC will arrange for such pending
deposit message to be transmitted to
Standard & Poor's Ratings Services,
which will use the information in the
message to include certain terms of
the related Book-Entry Note in the
appropriate daily bond report
published by Standard & Poor's Ratings
Services):
1. The information set forth in
Settlement Procedure A.
Annex II - 19
2. The identification numbers of the
participant accounts maintained by DTC
on behalf of the Trustee, Presenting
Agent and the Participant with respect
to such Note.
3. Identification of the Book-Entry Note
as a Fixed Rate Note or Floating
Rate Note.
4. The initial Interest Payment Date for
such Note, number of days by
which such Interest Payment Date
succeeds the related Regular
Record Date for DTC purposes
(or, in the case of Floating
Rate Notes which reset daily or
weekly, the date five calendar
days preceding the Interest
Payment Date) and, if then
calculable, the amount of
interest payable on such
Interest Payment Date (which
amount shall have been provided
by the Company).
5. The CUSIP number of the Book-Entry
Note representing such Note.
6. Whether such Book-Entry Note
represents any other Notes
issued or to be issued in
book-entry form.
D. The Trustee will complete a Book-Entry
Note representing such Note in a form
that has been approved by the
Company, the Agents and the Trustee.
E. The Trustee will authenticate the
Book-Entry Note representing such Note.
F. DTC will credit such Note to the
participant account of the Trustee
maintained by DTC.
G. The Trustee will enter an SDFS deliver order
through DTC's Participant Terminal System
instructing DTC (i) to debit such Note to
the Trustee's participant account and credit
such Note to the participant account
Annex II - 20
of the Presenting Agent maintained by DTC
and (ii) to debit the settlement account of
the Presenting Agent and credit the
settlement account of the Trustee maintained
by DTC, in an amount equal to the price of
such Note less such Presenting Agent's
commission. Any entry of such a deliver
order shall be deemed to constitute a
representation and warranty by the Trustee
to DTC that (i) the Book-Entry Note
representing such Note has been issued and
authenticated and (ii) the Trustee is
holding such Book-Entry Note pursuant to the
Certificate Agreement.
H. The Presenting Agent will enter an
SDFS deliver order through DTC's
Participant Terminal System
instructing DTC (i) to debit such Note
to the Presenting Agent's participant
account and credit such Note to the
participant account of the
Participants maintained by DTC and
(ii) to debit the settlement accounts
of such Participants and credit the
settlement account of the Presenting
Agent maintained by DTC, in an amount
equal to the initial public offering
price of such Note.
I. Transfers of funds in accordance with SDFS
deliver orders described in Settlement
Procedures G and H will be settled in
accordance with SDFS operating procedures in
effect on the Settlement Date.
J. The Trustee will transfer to the
Company's account (no. 30496369) at
(ABA no. 021000089) funds available
for immediate use in the amount
transferred to the Trustee in
accordance with Settlement Procedure G.
K. If requested by the Company, the
Trustee will send a copy of the first
page of the Book-Entry Note by first
class mail to the Company together
with a statement setting forth the
principal amount of Notes Outstanding
as of the related Settlement
Annex II - 21
Date after giving effect to such transaction
and all other offers to purchase Notes of
which the Company has advised the Trustee
but which have not yet been settled.
L. The Presenting Agent will confirm the
purchase of such Note to the purchaser
either by transmitting to the
Participant with respect to such Note
a confirmation order through DTC's
Participant Terminal System or by
mailing a written confirmation to such
purchaser.
Settlement Procedures For offers to purchase Book-Entry Notes
Timetable: accepted by the Company, Settlement
Procedures "A" through "L" set forth above shall
be completed as soon as possible but not later
than the respective times (New York City time) set
forth below:
Settlement
Procedure Time
--------- ----
A-B 11:00 a.m. on the trade date
C 2:00 p.m. on the trade date
D 3:00 p.m. on the Business Day
before Settlement Date
E 9:00 a.m. on Settlement Date
F 10:00 a.m. on Settlement Date
G-H 2:00 p.m. on Settlement Date
I 4:45 p.m. on Settlement Date
J-L 5:00 p.m. on Settlement Date
If a sale is to be settled more than one Business
Day after the trade date, Settlement Procedures A,
B, and C may, if necessary, be completed at any
time prior to the specified times on the first
Business Day after such trade date. In connection
with a sale which is to be settled more than one
Business Day after the trade date, if the Initial
Interest Rate for a Floating Rate Note is not
known at the time that Settlement Procedure A is
completed, Settlement Procedures B and C shall be
completed as soon as such Initial Interest Rate
has been determined, but no later than 11:00 a.m.
and 2:00 p.m. New York City time, respectively, on
the second Business Day before the Settlement
Date. Settlement Procedure I
Annex II - 22
is subject to extension in accordance with any
extension of Fedwire closing deadlines and in the
other events specified in the SDFS operating
procedures in effect on the Settlement Date.
If settlement of a Note issued in book-entry form
is rescheduled or canceled, the Company will
notify the Trustee and the Trustee will deliver to
DTC, through DTC's Participant Terminal System, a
cancellation message to such effect by no later
than 2:00 p.m. New York City time on the Business
Day immediately preceding the scheduled Settlement
Date.
Failure to Settle: If the Trustee fails to enter an SDFS
deliver order with respect to a Book-Entry
Note pursuant to Settlement Procedure G,
then upon written request of the Company
(which may be by telecopy) the Trustee shall
deliver to DTC, through DTC's Participant
Terminal System, as soon as practicable a
withdrawal message instructing DTC to debit
such Note to the participant account of the
Trustee maintained at DTC. DTC will process
the withdrawal message, provided that such
participant account contains a principal
amount of the Book-Entry Note representing
such Note that is at least equal to the
principal amount to be debited. If
withdrawal messages are processed with
respect to all the Notes represented by a
Book-Entry Note, the Trustee will destroy
such Book-Entry Note, make appropriate
entries in its records and send a
certificate of destruction with respect
thereto to the Company. The CUSIP number
assigned to such Book-Entry Note shall, in
accordance with CUSIP Service Bureau
procedures, be canceled and not immediately
reassigned. If withdrawal messages are
processed with respect to a portion of the
Notes represented by a Book-Entry Note, the
Trustee will exchange such Book-Entry Note
for two Book-Entry Notes, one of which shall
represent the Book-Entry Notes for which
withdrawal messages are processed and shall
be destroyed immediately after issuance, and
a certificate of destruction sent to the
Company with respect thereto and the other
of which shall represent the other Notes
previously represented by the surrendered
Book-Entry Note
Annex II - 23
and shall bear the CUSIP number of the surrendered
Book-Entry Note.
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 debiting such Note to
such Agent's account and crediting such Note to
the participant account of the Trustee and shall
notify the Trustee and the Company thereof.
Thereafter, the Trustee will (i) immediately
notify the Company thereof, once the Trustee has
confirmed that such Note has been credited to its
participant account, and the Company shall
immediately transfer by Fedwire (immediately
available funds) to the Presenting Agent an amount
equal to the price of such Note which was
previously sent by wire transfer to an account of
the Company in accordance with Settlement
Procedure J and (ii) deliver the withdrawal
message and take the related actions described in
the preceding paragraph. If such failure shall
have occurred for any reason other than default by
the Presenting Agent to perform its obligations
hereunder or under the Distribution Agreement, the
Company will reimburse the Presenting Agent on an
equitable basis for its loss of the use of funds
during the period when the funds were credited to
the account of the Company.
Notwithstanding the foregoing, upon any failure to
settle with respect to a 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 a Note that
was to have been represented by a Book-Entry Note
also representing other Notes, the Trustee will
provide, in accordance with Settlement Procedures
D and E, for the authentication and issuance of a
Book-Entry Note representing such remaining Notes
and will make appropriate entries in its records.
Annex II - 24
PART III: PROCEDURES FOR NOTES ISSUED IN CERTIFICATED FORM
Payments of Principal and The Trustee will pay to the holder the
Interest principal amount of each Certificated Note
at Maturity upon presentation and surrender of
such Certificated Note to the Trustee. Such
payment, together with payment of interest and
premium, if any, due at such Maturity, will be
made in immediately available funds.
All interest payments on a Certificated Note
(other than interest due at Maturity) will be made
by check drawn on the Trustee and mailed by the
Trustee to the person entitled thereto as provided
in the Security Register; provided, however, that
holders of $1,000,000 (or the equivalent thereof
in a specified currency other than U.S. dollars)
or more in aggregate principal amount of
Certificated Notes having the same Interest
Payment Dates will be entitled to receive such
interest payments by wire transfer in immediately
available funds if appropriate wire transfer
instructions have been received in writing by the
Trustee not less than 15 calendar days prior to
the applicable Interest Payment Date.
The Trustee will provide monthly to the Company a
list of the principal, premium, if any, and
interest to be paid on Certificated Notes maturing
in the next succeeding month. The Trustee will be
responsible for withholding taxes on interest paid
as required by applicable law, but shall be
relieved from any such responsibility if it acts
in good faith and in reliance upon an opinion of
counsel.
Certificated Notes presented to the Trustee for
payment at Maturity will be canceled and destroyed
by the Trustee and the Trustee shall furnish to
the Company a certificate regarding such
destruction.
Settlement Procedures: Settlement Procedures with regard to Certificated
Notes purchased through any Agent, as agent, shall
be as follows:
A. The Presenting Agent will advise the
Company by telephone or telecopy of
the
Annex II - 25
following settlement information with regard
to each Note:
1. Exact name in which the Note is to
be registered (the "Registered
Owner").
2. Exact address or addresses of the
Registered Owner for delivery,
notices and payments of principal,
premium, if any, and interest.
3. Taxpayer identification number of
the Registered Owner.
4. Principal amount of the Note and
specified currency.
5. Denomination of the Note.
6. Fixed Rate Notes:
a) Interest Rate, and
b) Whether such Note is being
issued with original issue
discount and, if so, the terms
thereof.
Floating Rate Notes:
a) Interest Rate Basis(es),
(i) If LIBOR, LIBOR Reuters or LIBOR
Moneyline Telerate,
(ii) If CMT Rate, the CMT Moneyline
Telerate Page,
(iii) If CMT Moneyline Telerate Page 7052,
Weekly Average or Monthly Average,
b) Initial Interest Rate, if any,
Annex II - 26
c) Spread and/or Spread Multiplier, if any,
d) Initial Interest Reset Date,
e) Interest Reset Date(s),
f) Interest Payment Date(s),
g) Index Maturity,
h) Maximum and/or minimum interest rates,
if any,
i) Calculation Date,
j) Interest Determination Dates,
k) Type of Floating Rate Note (i.e.
Regular Floating Rate
Note, Floating Rate/Fixed
Rate Note or Inverse
Floating Rate Note),
l) Fixed Rate Commencement Date, if any,
m) Fixed Interest Rate, if any, and
n) Day Count Convention.
7. Purchase Price (_______ %, plus accrued
interest, if any, from ___________).
8. Price to public of the Note (_______%,
plus accrued interest, if any, from ___________).
9. Trade date.
10. Settlement Date and Time.
11. Stated Maturity.
12. Original Issue Date.
13. Net proceeds to the Company.
Annex II - 27
14. Presenting Agent's commission.
15. Redemption provisions, if any,
including: Initial Redemption
Date, Initial Redemption
Percentage and Annual Redemption
Percentage Reduction.
16. Optional Repayment Date(s), if any.
17. Name of Presenting Agent.
18. Other provisions, if any.
B. The Company will advise the Trustee by
electronic means, telephone (confirmed
in writing by an authorized
representative of the Company at any
time on the same date) or telecopy of
the information set forth in
Settlement Procedure "A" above, and
shall direct the Trustee to complete,
authenticate and deliver the
Certificated Note(s). The Company
also shall provide to the Trustee and
the Presenting Agent a copy of the
applicable Pricing Supplement.
C. The Trustee will complete and authenticate
the preprinted 4-ply Certificated Note
packet containing the following documents in
forms approved by the Company, the
Presenting Agent and the Trustee:
1. Note with the Presenting Agent's
customer confirmation.
2. Stub 1 - for the Trustee.
3. Stub 2 - for the Presenting Agent.
4. Stub 3 - for the Company.
D. With respect to each trade, the Trustee will
deliver the Certificated Note(s) and Stub 2
thereof to the Presenting Agent at the
following applicable address:
Annex II - 28
If to Banc of America Securities LLC:
Banc of America Securities LLC
Bank of America Corporate Center
100 North Tryon Street, 7th Floor
Mail Code NC1-007-07-01
Attention: MTN Department
Charlotte, North Carolina 28255
Telecopy: 704-388-9939
and to:
Lily Chang
Banc of America Securities LLC
9 West 57th Street, 31st Floor
New York, New York 10019
If to Banc One Capital Markets, Inc.:
Banc One Capital Markets
1 Bank One Plaza, Suite IL-0463
Attention: MTN Desk
Chicago, Illinois 60670
If to Barclays Capital Inc.
Barclays Capital Inc.
222 Broadway
New York, New York 10038
Attention: Emanuel Efstathios
Telephone: 212-412-2527
Annex II - 29
If to BNP Paribas Securities Corp.:
BNP Paribas Securities Corp.
787 Seventh Avenue, 8th Floor
New York, New York 10019
Attention: Fixed Income Syndicate Desk
Telecopy: 212-841-3930
If to Deutsche Bank Securities Inc.:
Deutsche Bank Securities Inc.
31 West 52nd Street
3rd Floor - Debt Capital Markets
New York, New York 10019
Attention: Josh Witz
Telecopy: 212-469-7505
If to Goldman, Sachs & Co.:
Goldman, Sachs & Co.
85 Broad Street, 9th Floor
New York, New York 10004
Attention: Debra Laidlow-Lewis
Telephone: 212-902-6276
If to J.P. Morgan Securities Inc.
J.P. Morgan Securities Inc.
4 New York Plaza
Grand Floor Receiving Window
New York, New York 10041
Attention: Bob Schaefer
Telephone: 212-623-2240
Telecopy: 212-623-2659
Annex II - 30
If to Morgan Stanley & Co. Incorporated
Bank of New York
Dealer Clearance Department
1 Wall Street
3rd Floor, Window 3B
New York, New York 10005
Attention: For the Account of Morgan
Stanley & Co. Incorporated
If to Salomon Smith Barney Inc.:
New York Window
The Depository Trust Company
Mezzanine Level, 3rd Floor
For the Account of SSB
55 Water Street
New York, New York 10001
If to Wachovia Securities, Inc.:
Wachovia Securities, Inc.
One Wachovia Center, TW-8
301 South College Street
Charlotte, North Carolina 28288-0602
Attention: MTN Syndicate Desk
Telephone: 704-383-7727
Telecopy: 704-383-9165
The Trustee will keep Stub 1. The Presenting Agent
will acknowledge receipt of the Certificated Note
through a broker's receipt and will keep Stub 2.
Delivery of the Certificated Note will be made
only against such acknowledgment of receipt. Upon
determination that the Certificated Note has been
authorized, delivered and completed as
aforementioned, the Presenting Agent will wire the
net proceeds of the Certificated Note after
deduction of its applicable commission to the
Company pursuant to standard wire instructions
given by the Company.
Annex II - 31
E. The Presenting Agent will deliver the
Certificated Note (with confirmation), as
well as a copy of the Prospectus Supplement
with the applicable Pricing Supplement
delivered therewith, to the purchaser
against payment in immediately available
funds.
F. The Trustee will send Stub 3 to the
Company
Settlement Procedures For offers accepted by the Company,
Timetable: 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-B 12:00 p.m. on the Business
Day prior to Settlement Date
C-D 2:15 p.m. on Settlement Date
E 3:00 p.m. on Settlement Date
F 5:00 p.m. on Settlement Date
Failure to Settle: In the event that a purchaser of a
Certificated Note from the Company shall
either fail to accept delivery of or make
payment for a Certificated Note on the date
fixed for settlement, the Presenting Agent
will forthwith notify the Trustee and the
Company by telephone, confirmed in writing,
and return the Certificated Note (and
related stub) to the Trustee.
The Trustee, upon receipt of the Certificated Note
and related stub from the Presenting Agent, will
immediately advise the Company and the Company
will promptly transfer to the account of the
Presenting Agent an amount of immediately
available funds equal to the amount previously
paid by the Presenting Agent in settlement for the
Certificated Note. Such transfer will be made on
the Settlement Date if possible, and in any event
not later than the Business Day following the
Settlement Date; provided that the Company has
received notice on the same day. If such failure
shall have occurred for any reason other than
failure
Annex II - 32
by the Presenting Agent to perform its obligations
hereunder or under the Distribution Agreement, the
Company will reimburse the Presenting Agent on an
equitable basis for its loss of the use of funds
during the period when the funds were credited to
the account of the Company. Immediately upon
receipt of the Certificated Note in respect of
which the failure occurred, the Trustee will
cancel and destroy the Certificated Note (and
related stub), make appropriate entries in its
records to reflect the fact that the Certificated
Note was never issued, and deliver a certificate
of destruction with respect thereto to the
Company.
Annex II - 33
ANNEX III
American General Finance Corporation
Medium-Term Notes, Series H
Accountants' Letter
Pursuant to Sections 4(i) and 6(d), as the case may be, of the
Distribution Agreement, the accountants shall provide a comfort letter or
letters to the effect that:
(i) They are independent public accountants with respect to the Company
and its subsidiaries within the meaning of the Act and the applicable rules and
regulations thereunder adopted by the Commission;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules (and, if applicable, financial forecasts
and/or pro forma financial information) audited by them and included or
incorporated by reference in the Registration Statement and Prospectus comply as
to form in all material respects with the applicable accounting requirements of
the Act or the Exchange Act, as applicable, and the related rules and
regulations thereunder; and, if applicable, they have made a review in
accordance with standards established by the American Institute of Certified
Public Accountants of the consolidated interim financial statements, selected
financial data, pro forma financial information, financial forecasts and/or
condensed financial statements derived from audited financial statements of the
Company for the periods specified in such letter(s), as indicated in their
reports thereon, copies of which have been separately furnished to the Agents;
(iii) They have made a review in accordance with standards established by
the American Institute of Certified Public Accountants of the unaudited
condensed consolidated statements of income, consolidated balance sheets,
consolidated statements of cash flows and consolidated statements of
comprehensive income included in the Prospectus and/or included in the Company's
Quarterly Reports on Form 10-Q incorporated by reference into the Prospectus;
and on the basis of specified procedures including inquiries of officials of the
Company who have responsibility for financial and accounting matters regarding
whether the unaudited condensed consolidated financial statements referred to in
paragraph (vi)(A)(i) below comply as to form in all material respects with the
applicable accounting requirements of the Act and the Exchange Act and the
related rules and regulations, nothing came to their attention that caused them
to believe that the unaudited condensed consolidated financial statements do not
comply as to form in all material respects with the applicable accounting
requirements of the Act and the Exchange Act and the related rules and
regulations adopted by the Commission;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company for the
five most recent fiscal years included in the Prospectus and included or
incorporated by reference in Item 6 of the Company's Annual Report on Form 10-K
for the most recent fiscal year agrees with the corresponding amounts (after
restatement where applicable) in the audited consolidated financial statements
for such five fiscal years included or incorporated by reference in the
Company's Annual Reports on Form 10-K for such fiscal years;
Annex III - 1
(v) They have compared the information in the Prospectus under selected
captions with the disclosure requirements of Regulation S-K and on the basis of
limited procedures specified in such letter(s) nothing came to their attention
as a result of the foregoing procedures that caused them to believe that this
information does not conform in all material respects with the disclosure
requirements of Item 503(d) of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an examination
in accordance with generally accepted auditing standards, consisting of a
reading of the unaudited financial statements and other information referred to
below, a reading of the latest available interim financial statements of the
Company and its subsidiaries, inspection of the minute books of the Company and
its subsidiaries since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus, inquiries of officials
of the Company and its subsidiaries responsible for financial and accounting
matters and such other inquiries and procedures as may be specified in such
letter(s), nothing came to their attention that caused them to believe that:
A. (i) the unaudited condensed consolidated statements of income,
consolidated balance sheets, consolidated statements of cash flows and
consolidated statements of comprehensive income included and/or incorporated by
reference in the Prospectus and included in the Company's Quarterly Reports on
Form 10-Q incorporated by reference in the Prospectus do not comply as to form
in all material respects with the applicable accounting requirements of the Act
and the Exchange Act and the rules and regulations adopted by the Commission, or
(ii) any material modifications should be made to the unaudited condensed
consolidated statements of income, consolidated balance sheets, consolidated
statements of cash flows and consolidated statements of comprehensive income
included in the Prospectus or included in the Company's Quarterly Reports on
Form 10-Q incorporated by reference in the Prospectus for them to be in
conformity with generally accepted accounting principles;
B. any other unaudited income statement data and balance sheet items
included in the Prospectus do not agree with the corresponding items in the
unaudited consolidated financial statements from which such data and items were
derived, and any such unaudited data and items were not determined on a basis
substantially consistent with the basis for the corresponding amounts in the
audited consolidated financial statements included or incorporated by reference
in the Company's Annual Report on Form 10-K for the most recent fiscal year;
C. any unaudited pro forma consolidated condensed financial statements
included or incorporated by reference in the Prospectus do not comply as to form
in all material respects with the applicable accounting requirements of the Act
and the rules and regulations adopted by the Commission thereunder or the pro
forma adjustments have not been properly applied to the historical amounts in
the compilation of those statements;
D. as of a specified date not more than three business days prior to
the date of such letter(s), there have been any changes in the consolidated
capital stock or any increase in the consolidated long-term debt of the Company
and its subsidiaries or any decreases in consolidated net assets, in each case
as compared with amounts shown in the latest balance sheet included or
incorporated by reference in the Prospectus, except in each case for changes,
increases or
Annex III - 2
decreases which the Prospectus as amended and supplemented discloses have
occurred or may occur or which are described in such letter(s); and
E. for the period from the date of the latest financial statements
included or incorporated by reference in the Prospectus to a specified date not
more than three business days prior to the date of such letter(s) there were any
decreases in consolidated total revenues or the total amount of consolidated
income before extraordinary items or consolidated net income of the Company and
its subsidiaries in each case as compared with the comparable period of the
preceding year, except in each case for increases or decreases which the
Prospectus as amended and supplemented discloses have occurred or may occur or
which are described in such letter(s); and
(vii) In addition to the audit referred to in their report(s) included or
incorporated by reference in the Prospectus and the limited procedures,
inspection of minute books, inquiries and other procedures referred to in
paragraphs (iii) and (vi) above, they have carried out certain specified
procedures, not constituting an audit in accordance with generally accepted
auditing standards, with respect to certain amounts, percentages and financial
information specified by the Agents which are derived from the general
accounting records of the Company and its subsidiaries, which appear in the
Prospectus (excluding documents incorporated by reference), or in Part II of, or
in exhibits and schedules to, the Registration Statement specified by the Agents
or in documents incorporated by reference in the Prospectus specified by the
Agents, and have compared certain of such amounts, percentages and financial
information with the accounting records of the Company and its subsidiaries and
have found them to be in agreement.
For purposes of any such letter delivered as of the date of the
Distribution Agreement, all references in this Annex III to the "Prospectus"
shall be deemed to refer to the Prospectus (including the documents incorporated
by reference therein) as defined in the Distribution Agreement as of the date of
the Distribution Agreement. For purposes of any such letter delivered pursuant
to Section 4(i) of the Distribution Agreement, all references in this Annex III
to the "Prospectus" shall be deemed to refer to the Prospectus as amended or
supplemented (including the documents incorporated by reference therein) as of
the date of the amendment, supplement, incorporation or the Time of Delivery
relating to the Terms Agreement requiring the delivery of such letter under
Section 4(i) thereof.
Annex III - 3