Exhibit 10.3
COMMERCIAL PAPER DEALER AGREEMENT
[4(2) PROGRAM]
BETWEEN
SYSCO CORPORATION, AS ISSUER
AND
GOLDMAN, SACHS & CO., AS DEALER
CONCERNING NOTES TO BE ISSUED PURSUANT TO AN ISSUING AND PAYING AGENCY AGREEMENT
DATED AS OF APRIL 13, 2006 BETWEEN THE ISSUER AND JPMORGAN CHASE BANK, N.A., AS
ISSUING AND PAYING AGENT
DATED AS OF
APRIL 13, 2006
COMMERCIAL PAPER DEALER AGREEMENT
[4(2) PROGRAM]
This agreement (the "Agreement") sets forth the understandings between the
Issuer and the Dealer, each named on the cover page hereof, in connection with
the issuance and sale by the Issuer of its short-term promissory notes (the
"Notes") through the Dealer.
Certain terms used in this Agreement are defined in Section 6 hereof.
The Addendum to this Agreement, and any Annexes or Exhibits described in this
Agreement or such Addendum, are hereby incorporated into this Agreement and made
fully a part hereof.
1. OFFERS, SALES AND RESALES OF NOTES.
1.1 While (i) the Issuer has and shall have no obligation to sell the
Notes to the Dealer or to permit the Dealer to arrange any sale of the
Notes for the account of the Issuer, and (ii) the Dealer has and shall
have no obligation to purchase the Notes from the Issuer or to arrange
any sale of the Notes for the account of the Issuer, the parties
hereto agree that in any case where the Dealer purchases Notes from
the Issuer, or arranges for the sale of Notes by the Issuer, such
Notes will be purchased or sold by the Dealer in reliance on the
representations, warranties, covenants and agreements of the Issuer
contained herein or made pursuant hereto and on the terms and
conditions and in the manner provided herein.
1.2 So long as this Agreement shall remain in effect, and in addition to
the limitations contained in Section 1.7 hereof, the Issuer shall not,
without the consent of the Dealer, offer, solicit or accept offers to
purchase, or sell, any Notes except (a) in transactions with one or
more dealers which may from time to time after the date hereof become
dealers with respect to the Notes by executing with the Issuer one or
more agreements which contain provisions substantially identical to
those contained in Section 1 of this Agreement, of which the Issuer
hereby undertakes to provide the Dealer prompt notice or (b) in
transactions with the other dealers listed on the Addendum hereto,
which are executing agreements with the Issuer which contain
provisions substantially identical to Section 1 of this Agreement
contemporaneously herewith. In no event shall the Issuer offer,
solicit or accept offers to purchase, or sell, any Notes directly on
its own behalf in transactions with persons other than broker-dealers
as specifically permitted in this Section 1.2.
1.3 The Notes shall be in a minimum denomination of $250,000 or integral
multiples of $1,000 in excess thereof, will bear such interest rates,
if interest bearing, or will be sold at such discount from their face
amounts, as shall be agreed upon by the Dealer and the Issuer, shall
have a maturity not exceeding 270 days from the date of issuance and
may have such terms as are specified in Exhibit C hereto or the
Private Placement Memorandum. The Notes shall not contain any
provision for extension, renewal or automatic "rollover."
1.4 The authentication and issuance of, and payment for, the Notes shall
be effected in accordance with the Issuing and Paying Agency
Agreement, and the Notes shall be either individual physical
certificates or book-entry notes evidenced by one or more master notes
(each, a
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"Master Note") registered in the name of The Depository Trust Company
("DTC") or its nominee, in the form or forms annexed to the Issuing
and Paying Agency Agreement.
1.5 If the Issuer and the Dealer shall agree on the terms of the purchase
of any Note by the Dealer or the sale of any Note arranged by the
Dealer (including, but not limited to, agreement with respect to the
date of issue, purchase price, principal amount, maturity and interest
rate or interest rate index and margin (in the case of
interest-bearing Notes) or discount thereof (in the case of Notes
issued on a discount basis), and appropriate compensation for the
Dealer's services hereunder) pursuant to this Agreement, the Issuer
shall cause such Note to be issued and delivered in accordance with
the terms of the Issuing and Paying Agency Agreement and payment for
such Note shall be made by the purchaser thereof, either directly or
through the Dealer, to the Issuing and Paying Agent, for the account
of the Issuer. Except as otherwise agreed, in the event that the
Dealer is acting as an agent and a purchaser shall either fail to
accept delivery of or make payment for a Note on the date fixed for
settlement, the Dealer shall promptly notify the Issuer, and if the
Dealer has theretofore paid the Issuer for the Note, the Issuer will
promptly return such funds to the Dealer against its return of the
Note to the Issuer, in the case of a certificated Note, and upon
notice of such failure in the case of a book-entry Note. If such
failure occurred for any reason other than default by the Dealer, the
Issuer shall reimburse the Dealer on an equitable basis for the
Dealer's loss of the use of such funds for the period such funds were
credited to the Issuer's account.
1.6 In the case of any agreement by the Dealer to purchase a Note
hereunder (other than as agent) which provides for a settlement date
that is three New York Business Days or more after the date of such
agreement, the obligation of the Dealer to purchase the Note under
such agreement shall be subject to the conditions set forth on Exhibit
D.
1.7 The Dealer and the Issuer hereby establish and agree to observe the
following procedures in connection with offers, sales and subsequent
resales or other transfers of the Notes:
(a) Offers and sales of the Notes by or through the Dealer shall be
made only to: (i) investors reasonably believed by the Dealer to
be Qualified Institutional Buyers, Institutional Accredited
Investors or Sophisticated Individual Accredited Investors and
(ii) non-bank fiduciaries or agents that will be purchasing Notes
for one or more accounts, each of which is reasonably believed by
the Dealer to be an Institutional Accredited Investor or
Sophisticated Individual Accredited Investor.
(b) Resales and other transfers of the Notes by the holders thereof
shall be made only in accordance with the restrictions in the
legend described in clause (e) below.
(c) No general solicitation or general advertising shall be used in
connection with the offering of the Notes. Without limiting the
generality of the foregoing, without the prior written approval
of the Dealer, the Issuer shall not issue any press release or
place or publish any "tombstone" or other advertisement relating
to the Notes.
(d) No sale of Notes to any one purchaser shall be for less than
$250,000 principal or face amount, and no Note shall be issued in
a smaller principal or face amount. If the purchaser
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is a non-bank fiduciary acting on behalf of others, each person
for whom such purchaser is acting must purchase at least $250,000
principal or face amount of Notes.
(e) Offers and sales of the Notes by the Issuer through the Dealer
acting as agent for the Issuer shall be made in accordance with
Rule 506 under the Securities Act, and shall be subject to the
restrictions described in the legend appearing on Exhibit A
hereto. A legend substantially to the effect of such Exhibit A
shall appear as part of the Private Placement Memorandum used in
connection with offers and sales of Notes hereunder, as well as
on each individual certificate representing a Note and each
Master Note representing book-entry Notes offered and sold
pursuant to this Agreement.
(f) The Dealer shall furnish or shall have furnished to each
purchaser of Notes for which it has acted as the Dealer a copy of
the then-current Private Placement Memorandum unless such
purchaser has previously received a copy of the Private Placement
Memorandum as then in effect. The Private Placement Memorandum
shall expressly state that any person to whom Notes are offered
shall have an opportunity to ask questions of, and receive
information from, the Issuer and the Dealer and shall provide the
names, addresses and telephone numbers of the persons from whom
information regarding the Issuer may be obtained.
(g) The Issuer agrees, for the benefit of the Dealer and each of the
holders and prospective purchasers from time to time of the Notes
that, if at any time the Issuer shall not be subject to Section
13 or 15(d) of the Exchange Act, the Issuer will furnish, upon
request and at its expense, to the Dealer and to holders and
prospective purchasers of Notes information required by Rule
144A(d)(4)(i) in compliance with Rule 144A(d).
(h) In the event that any Note offered or to be offered by the Dealer
would be ineligible for resale under Rule 144A, the Issuer shall
immediately notify the Dealer (by telephone, confirmed in
writing) of such fact and shall promptly prepare and deliver to
the Dealer an amendment or supplement to the Private Placement
Memorandum describing the Notes that are ineligible, the reason
for such ineligibility and any other relevant information
relating thereto.
(i) The Issuer represents that it is not currently issuing commercial
paper in the United States market in reliance upon the exemption
provided by Section 3(a)(3) of the Securities Act. The Issuer
agrees that, if it shall issue commercial paper after the date
hereof in reliance upon such exemption] (a) the proceeds from the
sale of the Notes will be segregated from the proceeds of the
sale of any such commercial paper by being placed in a separate
account; (b) the Issuer will institute appropriate corporate
procedures to ensure that the offers and sales of notes issued by
the Issuer pursuant to the Section 3(a)(3) exemption are not
integrated with offerings and sales of Notes hereunder; and (c)
the Issuer will comply with each of the requirements of Section
3(a)(3) of the Securities Act in selling commercial paper or
other short-term debt securities other than the Notes in the
United States.
(j) The Issuer hereby agrees that, not later than 15 days after the
first sale of Notes as contemplated by this Agreement, it will
file with the SEC a notice on Form D in
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accordance with Rule 503 under the Securities Act and that it
will thereafter file such amendments to such notice as Rule 503
may require.
1.8 The Issuer hereby represents and warrants to the Dealer, in connection
with offers, sales and resales of Notes, as follows:
(a) The Issuer hereby confirms to the Dealer that (except as
permitted by Section 1.6(i)) within the preceding six months
neither the Issuer nor any person other than the Dealer or the
other dealers referred to in Section 1.2 hereof acting on behalf
of the Issuer has offered or sold any Notes, or any substantially
similar security of the Issuer (including, without limitation,
medium-term notes issued by the Issuer), to, or solicited offers
to buy any such security from, any person other than the Dealer
or the other dealers referred to in Section 1.2 hereof. The
Issuer also agrees that (except as permitted by Section 1.6(i)),
as long as the Notes are being offered for sale by the Dealer and
the other dealers referred to in Section 1.2 hereof as
contemplated hereby and until at least six months after the offer
of Notes hereunder has been terminated, neither the Issuer nor
any person other than the Dealer or the other dealers referred to
in Section 1.2 hereof (except as contemplated by Section 1.2
hereof) will offer the Notes or any substantially similar
security of the Issuer for sale to, or solicit offers to buy any
such security from, any person other than the Dealer or the other
dealers referred to in Section 1.2 hereof, it being understood
that such agreement is made with a view to bringing the offer and
sale of the Notes within the exemption provided by Section 4(2)
of the Securities Act and Rule 506 thereunder and shall survive
any termination of this Agreement. The Issuer hereby represents
and warrants that it has not taken or omitted to take, and will
not take or omit to take, any action that would cause the
offering and sale of Notes hereunder to be integrated with any
other offering of securities, whether such offering is made by
the Issuer or some other party or parties.
(b) In the event that the Dealer purchases Notes as principal and
does not resell such Notes on the day of such purchase, to the
extent necessary to comply with Regulation T and the
interpretations thereunder, the Dealer will sell such Notes
either (i) only to offerees it reasonably believes to be
Qualified Institutional Buyers or to Qualified Institutional
Buyers it reasonably believes are acting for other Qualified
Institutional Buyers, in each case in accordance with Rule 144A
or (ii) in a manner which would not cause a violation of
Regulation T and the interpretations thereunder.
2. REPRESENTATIONS AND WARRANTIES OF ISSUER.
The Issuer represents and warrants that:
2.1 The Issuer is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation
and has all the requisite power and authority to execute, deliver and
perform its obligations under the Notes, this Agreement and the
Issuing and Paying Agency Agreement.
2.2 This Agreement and the Issuing and Paying Agency Agreement have been
duly authorized, executed and delivered by the Issuer and constitute
legal, valid and binding obligations of the Issuer enforceable against
the Issuer in accordance with their terms, subject to applicable
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bankruptcy, insolvency and similar laws affecting creditors' rights
generally, and subject, as to enforceability, to general principles of
equity (regardless of whether enforcement is sought in a proceeding in
equity or at law).
2.3 The Notes have been duly authorized, and when issued as provided in
the Issuing and Paying Agency Agreement, will be duly and validly
issued and will constitute legal, valid and binding obligations of the
Issuer enforceable against the Issuer in accordance with their terms,
subject to applicable bankruptcy, insolvency and similar laws
affecting creditors' rights generally, and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is sought in a proceeding in equity or at law).
2.4 The offer and sale of the Notes in the manner contemplated hereby do
not require registration of the Notes under the Securities Act,
pursuant to the exemption from registration contained in Section 4(2)
thereof and Regulation D thereunder, and no indenture in respect of
the Notes is required to be qualified under the Trust Indenture Act of
1939, as amended.
2.5 There is and will be no other unsecured indebtedness of the Issuer
which is or will be contractually entitled to be senior in right of
payment to the Notes.
2.6 No consent or action of, or filing or registration with, any
governmental or public regulatory body or authority, including the
SEC, is required to authorize, or is otherwise required in connection
with the execution, delivery or performance of, this Agreement, the
Notes or the Issuing and Paying Agency Agreement, except as may be
required by the securities or Blue Sky laws of the various states in
connection with the offer and sale of the Notes.
2.7 Neither the execution and delivery of this Agreement and the Issuing
and Paying Agency Agreement, nor the issuance of the Notes in
accordance with the Issuing and Paying Agency Agreement, nor the
fulfillment of or compliance with the terms and provisions hereof or
thereof by the Issuer, will (i) result in the creation or imposition
of any mortgage, lien, charge or encumbrance of any nature whatsoever
upon any of the properties or assets of the Issuer, or (ii) violate or
result in a breach or a default under any of the terms of the Issuer's
charter documents or by-laws, any contract or instrument to which the
Issuer is a party or by which it or its property is bound, or any law
or regulation, or any order, writ, injunction or decree of any court
or government instrumentality, to which the Issuer is subject or by
which it or its property is bound, which breach or default might have
a material adverse effect on the condition (financial or otherwise),
operations or business prospects of the Issuer or the ability of the
Issuer to perform its obligations under this Agreement, the Notes or
the Issuing and Paying Agency Agreement.
2.8 There is no litigation or governmental proceeding pending, or to the
knowledge of the Issuer threatened, against or affecting the Issuer or
any of its subsidiaries which might result in a material adverse
change in the condition (financial or otherwise), operations or
business prospects of the Issuer or the ability of the Issuer to
perform its obligations under this Agreement, the Notes or the Issuing
and Paying Agency Agreement.
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2.9 The Issuer is not an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
2.10 Neither the Private Placement Memorandum nor the Company Information
contains any untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they
were made, not misleading.
2.11 Each (a) sale and issuance of Notes by the Issuer hereunder and (b)
amendment or supplement of the Private Placement Memorandum shall be
deemed a representation and warranty by the Issuer to the Dealer, as
of the date and time thereof, that, both before and after giving
effect to such sale and issuance and after giving effect to such
amendment or supplement, (i) the representations and warranties given
by the Issuer set forth in this Section 2 remain true and correct on
and as of such date and time as if made on and as of such date and at
such time, (ii) in the case of an issuance of Notes, the Notes being
issued on such date have been duly and validly issued and constitute
legal, valid and binding obligations of the Issuer, enforceable
against the Issuer in accordance with their terms, subject to
applicable bankruptcy, insolvency and similar laws affecting
creditors' rights generally and subject, as to enforceability, to
general principles of equity (regardless of whether enforcement is
sought in a proceeding in equity or at law) and (iii) in the case of
an issuance or sale of Notes by the Issuer, since the date of the most
recent Private Placement Memorandum, there has been no material
adverse change in the condition (financial or otherwise), operations
or business prospects of the Issuer which has not been disclosed to
the Dealer in writing.
3. COVENANTS AND AGREEMENTS OF ISSUER.
The Issuer covenants and agrees that:
3.1 The Issuer will give the Dealer prompt notice (but in any event prior
to any subsequent sale or issuance of Notes by the Issuer hereunder)
of any amendment to, modification of or waiver with respect to, the
Notes or the Issuing and Paying Agency Agreement, including a complete
copy of any such amendment, modification or waiver.
3.2 The Issuer shall, whenever there shall occur any change in the
Issuer's condition (financial or otherwise), operations or business
prospects or any development or occurrence in relation to the Issuer
that would be material to holders of the Notes or potential holders of
the Notes (including any downgrading or receipt of any notice of
intended or potential downgrading or any review for potential change
in the rating accorded any of the Issuer's securities by any
nationally recognized statistical rating organization which has
published a rating of the Notes), promptly, and in any event prior to
any subsequent sale or issuance of Notes by the Issuer hereunder,
notify the Dealer (by telephone, confirmed in writing) of such change,
development or occurrence.
3.3 The Issuer shall from time to time furnish to the Dealer such
information as the Dealer may reasonably request, including, without
limitation, any press releases or material provided by the Issuer to
any national securities exchange or rating agency, regarding (i) the
Issuer's operations
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and financial condition, (ii) the due authorization and execution of
the Notes and (iii) the Issuer's ability to pay the Notes as they
mature.
3.4 The Issuer will take all such action as the Dealer may reasonably
request to ensure that each offer and each sale of the Notes will
comply with any applicable state Blue Sky laws; provided, however,
that the Issuer shall not be obligated to file any general consent to
service of process or to qualify as a foreign corporation in any
jurisdiction in which it is not so qualified or subject itself to
taxation in respect of doing business in any jurisdiction in which it
is not otherwise so subject.
3.5 The Issuer will not be in default of any of its obligations hereunder,
under the Notes or under the Issuing and Paying Agency Agreement, at
any time that any of the Notes are outstanding.
3.6 The Issuer shall not issue or sell Notes hereunder until the Dealer
shall have received (a) an opinion of counsel to the Issuer, addressed
to the Dealer, satisfactory in form and substance to the Dealer, (b) a
copy of the executed Issuing and Paying Agency Agreement as then in
effect, (c) a copy of resolutions adopted by the Board of Directors of
the Issuer, satisfactory in form and substance to the Dealer and
certified by the Secretary or similar officer of the Issuer,
authorizing execution and delivery by the Issuer of this Agreement,
the Issuing and Paying Agency Agreement and the Notes and consummation
by the Issuer of the transactions contemplated hereby and thereby, (d)
prior to the issuance of any book-entry Notes represented by a master
note registered in the name of DTC or its nominee, a copy of the
executed Letter of Representations among the Issuer, the Issuing and
Paying Agent and DTC and of the executed master note, (e) prior to the
issuance of any Notes in physical form, a copy of such form (unless
attached to this Agreement or the Issuing and Paying Agency Agreement)
and (f) such other certificates, opinions, letters and documents as
the Dealer shall have reasonably requested.
3.7 The Issuer shall reimburse the Dealer for all of the Dealer's
out-of-pocket expenses related to this Agreement, including expenses
incurred in connection with its preparation and negotiation, and the
transactions contemplated hereby (including, but not limited to, the
printing and distribution of the Private Placement Memorandum), and,
if applicable, for the reasonable fees and out-of-pocket expenses of
the Dealer's counsel.
4. DISCLOSURE.
4.1 The Private Placement Memorandum and its contents (other than the
Dealer Information) shall be the sole responsibility of the Issuer.
The Private Placement Memorandum shall contain a statement expressly
offering an opportunity for each prospective purchaser to ask
questions of, and receive answers from, the Issuer concerning the
offering of Notes and to obtain relevant additional information which
the Issuer possesses or can acquire without unreasonable effort or
expense.
4.2 The Issuer agrees to promptly furnish the Dealer the Company
Information as it becomes available.
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4.3 (a) The Issuer further agrees to notify the Dealer promptly upon the
occurrence of any event relating to or affecting the Issuer that would
cause the Company Information then in existence to include an untrue
statement of a material fact or to omit to state a material fact
necessary in order to make the statements contained therein, in light
of the circumstances under which they are made, not misleading.
(b) In the event that the Issuer gives the Dealer notice pursuant to
Section 4.3(a) and the Dealer notifies the Issuer that it then has
Notes it is holding in inventory, the Issuer agrees promptly to
supplement or amend the Private Placement Memorandum so that the
Private Placement Memorandum, as amended or supplemented, shall not
contain an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading,
and the Issuer shall make such supplement or amendment available to
the Dealer. Unless the Issuer fails to comply with its obligations in
the preceding sentence, all solicitations and sales of Notes shall be
suspended until such time as the Issuer has so amended or supplemented
the Private Placement Memorandum and made such amendment or supplement
available to the Dealer.
(c) In the event that (i) the Issuer gives the Dealer notice pursuant
to Section 4.3(a), (ii) the Dealer does not notify the Issuer that it
is then holding Notes in inventory and (iii) the Issuer chooses not to
promptly amend or supplement the Private Placement Memorandum in the
manner described in clause (b) above, then all solicitations and sales
of Notes shall be suspended until such time as the Issuer has so
amended or supplemented the Private Placement Memorandum, and made
such amendment or supplement available to the Dealer.
(d) Without limiting the generality of Section 4.3(a), the Issuer
shall review, amend and supplement the Private Placement Memorandum on
a periodic basis, but no less than at least once annually, to
incorporate current financial information of the Issuer to the extent
necessary to ensure that the information provided in the Private
Placement Memorandum is accurate and complete.
5. INDEMNIFICATION AND CONTRIBUTION.
5.1 The Issuer will indemnify and hold harmless the Dealer, each
individual, corporation, partnership, trust, association or other
entity controlling the Dealer, any affiliate of the Dealer or any such
controlling entity and their respective directors, officers,
employees, partners, incorporators, shareholders, servants, trustees
and agents (hereinafter the "Indemnitees") against any and all
liabilities, penalties, suits, causes of action, losses, damages,
claims, costs and expenses (including, without limitation, reasonable
fees and disbursements of counsel) or judgments of whatever kind or
nature (each a "Claim"), imposed upon, incurred by or asserted against
the Indemnitees arising out of or based upon (i) any allegation that
the Private Placement Memorandum, the Company Information or any
information provided by the Issuer to the Dealer included (as of any
relevant time) or includes an untrue statement of a material fact or
omitted (as of any relevant time) or omits to state any material fact
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading or (ii)
arising out of or based upon the breach by the Issuer of any
agreement, covenant or representation made in or pursuant to this
Agreement. This indemnification shall not apply to the extent that the
Claim arises out of or is based upon Dealer Information.
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5.2 Provisions relating to claims made for indemnification under this
Section 5 are set forth on Exhibit B to this Agreement.
5.3 In order to provide for just and equitable contribution in
circumstances in which the indemnification provided for in this
Section 5 is held to be unavailable or insufficient to hold harmless
the Indemnitees, although applicable in accordance with the terms of
this Section 5, the Issuer shall contribute to the aggregate costs
incurred by the Dealer in connection with any Claim in the proportion
of the respective economic interests of the Issuer and the Dealer;
provided, however, that such contribution by the Issuer shall be in an
amount such that the aggregate costs incurred by the Dealer do not
exceed the aggregate of the commissions and fees earned by the Dealer
hereunder with respect to the issue or issues of Notes to which such
Claim relates. The respective economic interests shall be calculated
by reference to the aggregate proceeds to the Issuer of the Notes
issued hereunder and the aggregate commissions and fees earned by the
Dealer hereunder.
6. DEFINITIONS.
6.1 "Claim" shall have the meaning set forth in Section 5.1.
6.2 "Company Information" at any given time shall mean the Private
Placement Memorandum together with, to the extent applicable, (i) the
Issuer's most recent report on Form 10-K filed with the SEC and each
report on Form 10-Q or 8-K filed by the Issuer with the SEC since the
most recent Form 10-K, (ii) the Issuer's most recent annual audited
financial statements and each interim financial statement or report
prepared subsequent thereto, if not included in item (i) above, (iii)
the Issuer's and its affiliates' other publicly available recent
reports, including, but not limited to, any publicly available filings
or reports provided to their respective shareholders, (iv) any other
information or disclosure prepared pursuant to Section 4.3 hereof and
(v) any information prepared or approved by the Issuer for
dissemination to investors or potential investors in the Notes.
6.3 "Dealer Information" shall mean material concerning the Dealer
provided by the Dealer in writing expressly for inclusion in the
Private Placement Memorandum.
6.4 "Exchange Act" shall mean the U.S. Securities Exchange Act of 1934, as
amended.
6.5 "Indemnitee" shall have the meaning set forth in Section 5.1.
6.6 "Institutional Accredited Investor" shall mean an institutional
investor that is an accredited investor within the meaning of Rule 501
under the Securities Act and that has such knowledge and experience in
financial and business matters that it is capable of evaluating and
bearing the economic risk of an investment in the Notes, including,
but not limited to, a bank, as defined in Section 3(a)(2) of the
Securities Act, or a savings and loan association or other
institution, as defined in Section 3(a)(5)(A) of the Securities Act,
whether acting in its individual or fiduciary capacity.
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6.7 "Issuing and Paying Agency Agreement" shall mean the issuing and
paying agency agreement described on the cover page of this Agreement,
as such agreement may be amended or supplemented from time to time.
6.8 "Issuing and Paying Agent" shall mean the party designated as such on
the cover page of this Agreement, as issuing and paying agent under
the Issuing and Paying Agency Agreement, or any successor thereto in
accordance with the Issuing and Paying Agency Agreement.
6.9 "Non-bank fiduciary or agent" shall mean a fiduciary or agent other
than (a) a bank, as defined in Section 3(a)(2) of the Securities Act,
or (b) a savings and loan association, as defined in Section
3(a)(5)(A) of the Securities Act.
6.10 "Private Placement Memorandum" shall mean offering materials prepared
in accordance with Section 4 (including materials referred to therein
or incorporated by reference therein, if any) provided to purchasers
and prospective purchasers of the Notes, and shall include amendments
and supplements thereto which may be prepared from time to time in
accordance with this Agreement (other than any amendment or supplement
that has been completely superseded by a later amendment or
supplement).
6.11 "Qualified Institutional Buyer" shall have the meaning assigned to
that term in Rule 144A under the Securities Act.
6.12 "Regulation D" shall mean Regulation D (Rules 501 et seq.) under the
Securities Act.
6.13 "Rule 144A" shall mean Rule 144A under the Securities Act.
6.14 "SEC" shall mean the U.S. Securities and Exchange Commission.
6.15 "Securities Act" shall mean the U.S. Securities Act of 1933, as
amended.
6.16 "Sophisticated Individual Accredited Investor" shall mean an
individual who (a) is an accredited investor within the meaning of
Regulation D under the Securities Act and (b) based on his or her
pre-existing relationship with the Dealer, is reasonably believed by
the Dealer to be a sophisticated investor (i) possessing such
knowledge and experience (or represented by a fiduciary or agent
possessing such knowledge and experience) in financial and business
matters that he or she is capable of evaluating and bearing the
economic risk of an investment in the Notes and (ii) having not less
than $5 million in investments (as defined, for purposes of this
section, in Rule 2a51-1 under the Investment Company Act of 1940, as
amended).
7. GENERAL
7.1 Unless otherwise expressly provided herein, all notices under this
Agreement to parties hereto shall be in writing and shall be effective
when received at the address of the respective party set forth in the
Addendum to this Agreement.
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7.2 This Agreement shall be governed by and construed in accordance with
the laws of the State of New York, without regard to its conflict of
laws provisions.
7.3 Each party agrees that any suit, action or proceeding brought by the
other against such party in connection with or arising out of this
Agreement or the Notes or the offer and sale of the Notes shall be
brought solely in the United States federal courts located in the
Borough of Manhattan or the courts of the State of New York located in
the Borough of Manhattan. EACH OF THE DEALER AND THE ISSUER WAIVES ITS
RIGHT TO TRIAL BY JURY IN ANY SUIT, ACTION OR PROCEEDING WITH RESPECT
TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
7.4 This Agreement may be terminated, at any time, by the Issuer, upon one
business day's prior notice to such effect to the Dealer, or by the
Dealer upon one business day's prior notice to such effect to the
Issuer. Any such termination, however, shall not affect the
obligations of the Issuer under Sections 3.7, 5 and 7.3 hereof or the
respective representations, warranties, agreements, covenants, rights
or responsibilities of the parties made or arising prior to the
termination of this Agreement.
7.5 This Agreement is not assignable by either party hereto without the
written consent of the other party; provided, however, that the Dealer
may assign its rights and obligations under this Agreement to any
affiliate of the Dealer provided that the Dealer shall not, absent the
prior written consent of the Issuer, be released from (i) any
liability to which the Dealer has theretofor become subject as a
result of the Dealer's prior breach of any of its covenants or
representations hereunder or (ii) any liability or obligation arising
out of any transaction initiated hereunder prior to such assignment.
7.6 This Agreement may be signed in any number of counterparts, each of
which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
7.7 This Agreement is for the exclusive benefit of the parties hereto, and
their respective permitted successors and assigns hereunder, and shall
not be deemed to give any legal or equitable right, remedy or claim to
any other person whatsoever.
7.8 (a) Any payments to the Dealer hereunder or to any holder from time to
time of Notes shall be in United States dollars and shall be free of
all withholding and other taxes and of all other governmental charges
of any nature whatsoever imposed by the jurisdiction in which the
Issuer is located. In the event any withholding is required by law,
the Issuer agrees to (i) pay the same and (ii) pay such additional
amounts to the Dealer or any such holder which, after deduction of any
such withholding or other taxes or governmental charges of any nature
whatsoever imposed with respect to the payment of such additional
amount, shall equal the amount withheld pursuant to clause (i). The
Issuer will promptly pay any stamp duty or other taxes or governmental
charges payable in connection with the execution, delivery, payment or
performance of this Agreement, the Issuing and Paying Agency Agreement
or the Notes and shall indemnify and hold harmless the Dealer and each
holder of Notes from all liabilities arising from any failure to pay,
or delay in paying, such taxes or charges.
12
(b) The Issuer agrees to indemnify and hold harmless the Dealer and
each holder from time to time of Notes against any loss incurred by
the Dealer or such holder as a result of any judgment or order being
given or made for any amount due hereunder and such judgment or order
being expressed and paid in a currency (the "Judgment Currency") other
than United States dollars and as a result of any variation as between
(i) the rate of exchange at which the United States dollar amount is
converted into the Judgment Currency for the purpose of such judgment
or order, and (ii) the rate of exchange at which the Dealer or such
holder is able to purchase United States dollars with the amount of
Judgment Currency actually received by the Dealer or such holder. The
foregoing indemnity shall constitute a separate and independent
obligation of the Issuer and shall continue in full force and effect
notwithstanding any such judgment or order as aforesaid. The term
"rate of exchange" shall include any premiums and costs of exchange
payable in connection with the purchase of, or conversion into, the
relevant currency.
7.9 The Issuer acknowledges and agrees that (i) the purchase and sale of
the Notes pursuant to this Agreement is an arm's-length commercial
transaction between the Issuer, on the one hand, and the Dealer, on
the other, (ii) in connection therewith and with the process leading
to such transaction the Dealer is acting solely as a principal and not
the agent or fiduciary of the Issuer, (iii) the Dealer has not assumed
an advisory or fiduciary responsibility in favor of the Issuer with
respect to the offering contemplated hereby or the process leading
thereto (irrespective of whether the Dealer has advised or is
currently advising the Issuer on other matters) or any other
obligation to the Issuer except the obligations expressly set forth in
this Agreement and (iv) the Issuer has consulted its own legal and
financial advisors to the extent it deemed appropriate. The Issuer
agrees that it will not claim that the Dealer has rendered advisory
services of any nature or respect, or owes a fiduciary or similar duty
to the Issuer, in connection with such transaction or the process
leading thereto.
This Agreement supersedes all prior agreements and understandings (whether
written or oral) between the Issuer and the Dealer, or any of them, with respect
to the subject matter hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the date and year first above written.
SYSCO CORPORATION, AS ISSUER GOLDMAN, SACHS & CO., AS DEALER
By: /s/ Kathy Oates Gish By: /s/ Joseph H. Ziluca
--------------------------------- ------------------------------------
Name: Kathy Oates Gish Name: Joseph H. Ziluca
Title: Vice President and Asst. Title: AUTHORIZED SIGNATORY
Treasurer
13
ADDENDUM
The following additional clauses shall apply to the Agreement and be deemed a
part thereof.
1. The other dealer referred to in clause (b) of Section 1.2 of the Agreement
is J.P. Morgan Securities, Inc.
2. The addresses of the respective parties for purposes of notices under
Section 7.1 are as follows:
For the Issuer: Sysco Corporation
Address: 1390 Enclave Parkway, Houston, Texas 77077
Attention: Kathy Oates Gish, Vice President and Assistant Treasurer
Telephone number: 281-584-1443
Fax number: 281-584-1792
For the Dealer: Goldman, Sachs & Co.
Address: 85 Broad Street, New York, New York 10004
Attention: Money Market Origination
Telephone number: 212-902-6181
Fax number: 212-902-0683
14
EXHIBIT A
FORM OF LEGEND FOR PRIVATE PLACEMENT MEMORANDUM AND NOTES
THE NOTES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), OR ANY OTHER APPLICABLE SECURITIES LAW, AND OFFERS AND SALES
THEREOF MAY BE MADE ONLY IN COMPLIANCE WITH AN APPLICABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE ACT AND ANY APPLICABLE STATE SECURITIES LAWS.
BY ITS ACCEPTANCE OF A NOTE, THE PURCHASER WILL BE DEEMED TO REPRESENT THAT (I)
IT HAS BEEN AFFORDED AN OPPORTUNITY TO INVESTIGATE MATTERS RELATING TO THE
ISSUER AND THE NOTES, (II) IT IS NOT ACQUIRING SUCH NOTE WITH A VIEW TO ANY
DISTRIBUTION THEREOF AND (III) IT IS EITHER (A)(1) AN INSTITUTIONAL INVESTOR OR
SOPHISTICATED INDIVIDUAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE
MEANING OF RULE 501(a) UNDER THE ACT AND WHICH, IN THE CASE OF AN INDIVIDUAL,
(i) POSSESSES SUCH KNOWLEDGE AND EXPERIENCE IN FINANCIAL AND BUSINESS MATTERS
THAT HE OR SHE IS CAPABLE OF EVALUATING AND BEARING THE ECONOMIC RISK OF AN
INVESTMENT IN THE NOTES AND (ii) HAS NOT LESS THAN $5 MILLION IN INVESTMENTS (AN
"INSTITUTIONAL ACCREDITED INVESTOR" OR "SOPHISTICATED INDIVIDUAL ACCREDITED
INVESTOR", RESPECTIVELY) AND (2)(i) PURCHASING NOTES FOR ITS OWN ACCOUNT, (ii) A
BANK (AS DEFINED IN SECTION 3(a)(2) OF THE ACT) OR A SAVINGS AND LOAN
ASSOCIATION OR OTHER INSTITUTION (AS DEFINED IN SECTION 3(a)(5)(A) OF THE ACT)
ACTING IN ITS INDIVIDUAL OR FIDUCIARY CAPACITY, PROVIDED THAT, IF IT IS ACTING
IN A FIDUCIARY CAPACITY, IT HAS SOLE INVESTMENT DISCRETION WITH RESPECT TO ANY
ACCOUNT FOR WHICH IT IS PURCHASING A NOTE, OR (iii) A FIDUCIARY OR AGENT (OTHER
THAN A U.S. BANK OR SAVINGS AND LOAN ASSOCIATION) PURCHASING NOTES FOR ONE OR
MORE ACCOUNTS EACH OF WHICH ACCOUNTS IS SUCH AN INSTITUTIONAL ACCREDITED
INVESTOR OR SOPHISTICATED INDIVIDUAL ACCREDITED INVESTOR; OR (B) A QUALIFIED
INSTITUTIONAL BUYER ("QIB") WITHIN THE MEANING OF RULE 144A UNDER THE ACT THAT
IS ACQUIRING NOTES FOR ITS OWN ACCOUNT OR FOR ONE OR MORE ACCOUNTS, EACH OF
WHICH ACCOUNTS IS A QIB; AND THE PURCHASER ACKNOWLEDGES THAT IT IS AWARE THAT
THE SELLER MAY RELY UPON THE EXEMPTION FROM THE REGISTRATION PROVISIONS OF
SECTION 5 OF THE ACT PROVIDED BY RULE 144A. BY ITS ACCEPTANCE OF A NOTE, THE
PURCHASER THEREOF SHALL ALSO BE DEEMED TO AGREE THAT ANY RESALE OR OTHER
TRANSFER THEREOF WILL BE MADE ONLY (A) IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE ACT, EITHER (1) TO THE ISSUER OR TO A PLACEMENT AGENT DESIGNATED BY
THE ISSUER AS A PLACEMENT AGENT FOR THE NOTES (COLLECTIVELY, THE "PLACEMENT
AGENTS"), NONE OF WHICH SHALL HAVE ANY OBLIGATION TO ACQUIRE SUCH NOTE, (2)
THROUGH A PLACEMENT AGENT TO AN INSTITUTIONAL ACCREDITED INVESTOR, SOPHISTICATED
INDIVIDUAL ACCREDITED INVESTOR OR A QIB, OR (3) TO A QIB IN A TRANSACTION THAT
MEETS THE REQUIREMENTS OF RULE 144A AND (B) IN MINIMUM AMOUNTS OF $250,000.
15
EXHIBIT B
FURTHER PROVISIONS RELATING TO INDEMNIFICATION
(a) The Issuer agrees to reimburse each Indemnitee for all expenses (including
reasonable fees and disbursements of internal and external counsel) as they
are incurred by it in connection with investigating or defending any loss,
claim, damage, liability or action in respect of which indemnification may
be sought under Section 5 of the Agreement (whether or not it is a party to
any such proceedings).
(b) Promptly after receipt by an Indemnitee of notice of the existence of a
Claim, such Indemnitee will, if a claim in respect thereof is to be made
against the Issuer, notify the Issuer in writing of the existence thereof;
provided that (i) the omission so to notify the Issuer will not relieve the
Issuer from any liability which it may have hereunder unless and except to
the extent it did not otherwise learn of such Claim and such failure
results in the forfeiture by the Issuer of substantial rights and defenses,
and (ii) the omission so to notify the Issuer will not relieve it from
liability which it may have to an Indemnitee otherwise than on account of
this indemnity agreement. In case any such Claim is made against any
Indemnitee and it notifies the Issuer of the existence thereof, the Issuer
will be entitled to participate therein, and to the extent that it may
elect by written notice delivered to the Indemnitee, to assume the defense
thereof, with counsel reasonably satisfactory to such Indemnitee; provided
that if the defendants in any such Claim include both the Indemnitee and
the Issuer, and the Indemnitee shall have concluded that there may be legal
defenses available to it which are different from or additional to those
available to the Issuer, the Issuer shall not have the right to direct the
defense of such Claim on behalf of such Indemnitee, and the Indemnitee
shall have the right to select separate counsel to assert such legal
defenses on behalf of such Indemnitee. Upon receipt of notice from the
Issuer to such Indemnitee of the Issuer's election so to assume the defense
of such Claim and approval by the Indemnitee of counsel, the Issuer will
not be liable to such Indemnitee for expenses incurred thereafter by the
Indemnitee in connection with the defense thereof (other than reasonable
costs of investigation) unless (i) the Indemnitee shall have employed
separate counsel in connection with the assertion of legal defenses in
accordance with the proviso to the next preceding sentence (it being
understood, however, that the Issuer shall not be liable for the expenses
of more than one separate counsel (in addition to any local counsel in the
jurisdiction in which any Claim is brought), approved by the Dealer,
representing the Indemnitee who is party to such Claim), (ii) the Issuer
shall not have employed counsel reasonably satisfactory to the Indemnitee
to represent the Indemnitee within a reasonable time after notice of
existence of the Claim or (iii) the Issuer has authorized in writing the
employment of counsel for the Indemnitee. The indemnity, reimbursement and
contribution obligations of the Issuer hereunder shall be in addition to
any other liability the Issuer may otherwise have to an Indemnitee and
shall be binding upon and inure to the benefit of any successors, assigns,
heirs and personal representatives of the Issuer and any Indemnitee. The
Issuer agrees that without the Dealer's prior written consent, it will not
settle, compromise or consent to the entry of any judgment in any Claim in
respect of which indemnification may be sought under the indemnification
provision of the Agreement (whether or not the Dealer or any other
Indemnitee is an actual or potential party to such Claim), unless such
settlement, compromise or consent (i) includes an unconditional release of
each Indemnitee from all liability arising out of such Claim and (ii) does
not include a statement as to or an admission of fault, culpability or
failure to act, by or on behalf of any Indemnitee.
16
EXHIBIT C
STATEMENT OF TERMS FOR INTEREST - BEARING COMMERCIAL PAPER NOTES OF SYSCO
CORPORATION
THE PROVISIONS SET FORTH BELOW ARE QUALIFIED TO THE EXTENT APPLICABLE BY THE
TRANSACTION SPECIFIC [PRICING] [PRIVATE PLACEMENT MEMORANDUM] SUPPLEMENT (THE
"SUPPLEMENT") (IF ANY) SENT TO EACH PURCHASER AT THE TIME OF THE TRANSACTION.
1. General. (a) The obligations of the Issuer to which these terms apply
(each a "Note") are represented by one or more Master Notes (each, a
"Master Note") issued in the name of (or of a nominee for) The Depository
Trust Company ("DTC"), which Master Note includes the terms and provisions
for the Issuer's Interest-Bearing Commercial Paper Notes that are set forth
in this Statement of Terms, since this Statement of Terms constitutes an
integral part of the Underlying Records as defined and referred to in the
Master Note.
(b) "Business Day" means any day other than a Saturday or Sunday that is
neither a legal holiday nor a day on which banking institutions are
authorized or required by law, executive order or regulation to be closed
in New York City and, with respect to LIBOR Notes (as defined below) is
also a London Business Day. "London Business Day" means, a day, other than
a Saturday or Sunday, on which dealings in deposits in U.S. dollars are
transacted in the London interbank market.
2. Interest. (a) Each Note will bear interest at a fixed rate (a "Fixed
Rate Note") or at a floating rate (a "Floating Rate Note").
(b) The Supplement sent to each holder of such Note will describe the
following terms: (i) whether such Note is a Fixed Rate Note or a Floating
Rate Note and whether such Note is an Original Issue Discount Note (as
defined below); (ii) the date on which such Note will be issued (the "Issue
Date"); (iii) the Stated Maturity Date (as defined below); (iv) if such
Note is a Fixed Rate Note, the rate per annum at which such Note will bear
interest, if any, and the Interest Payment Dates; (v) if such Note is a
Floating Rate Note, the Base Rate, the Index Maturity, the Interest Reset
Dates, the Interest Payment Dates and the Spread and/or Spread Multiplier,
if any (all as defined below), and any other terms relating to the
particular method of calculating the interest rate for such Note; and (vi)
any other terms applicable specifically to such Note. "Original Issue
Discount Note" means a Note which has a stated redemption price at the
Stated Maturity Date that exceeds its Issue Price by more than a specified
de minimis amount and which the Supplement indicates will be an "Original
Issue Discount Note".
(c) Each Fixed Rate Note will bear interest from its Issue Date at the rate
per annum specified in the Supplement until the principal amount thereof is
paid or made available for payment. Interest on each Fixed Rate Note will
be payable on the dates specified in the Supplement (each an "Interest
Payment Date" for a Fixed Rate Note) and on the Maturity Date (as defined
below). Interest on Fixed Rate Notes will be computed on the basis of a
360-day year of twelve 30-day months.
If any Interest Payment Date or the Maturity Date of a Fixed Rate Note
falls on a day that is not a Business Day, the required payment of
principal, premium, if any, and/or interest will be payable on
17
the next succeeding Business Day, and no additional interest will accrue in
respect of the payment made on that next succeeding Business Day.
(d) The interest rate on each Floating Rate Note for each Interest Reset
Period (as defined below) will be determined by reference to an interest
rate basis (a "Base Rate") plus or minus a number of basis points (one
basis point equals one-hundredth of a percentage point) (the "Spread"), if
any, and/or multiplied by a certain percentage (the "Spread Multiplier"),
if any, until the principal thereof is paid or made available for payment.
The Supplement will designate which of the following Base Rates is
applicable to the related Floating Rate Note: (a) the CD Rate (a "CD Rate
Note"), (b) the Commercial Paper Rate (a "Commercial Paper Rate Note"), (c)
the Federal Funds Rate (a "Federal Funds Rate Note"), (d) LIBOR (a "LIBOR
Note"), (e) the Prime Rate (a "Prime Rate Note"), (f) the Treasury Rate (a
"Treasury Rate Note") or (g) such other Base Rate as may be specified in
such Supplement.
The rate of interest on each Floating Rate Note will be reset daily,
weekly, monthly, quarterly or semi-annually (the "Interest Reset Period").
The date or dates on which interest will be reset (each an "Interest Reset
Date") will be, unless otherwise specified in the Supplement, in the case
of Floating Rate Notes which reset daily, each Business Day, in the case of
Floating Rate Notes (other than Treasury Rate Notes) that reset weekly, the
Wednesday of each week; in the case of Treasury Rate Notes that reset
weekly, the Tuesday of each week; in the case of Floating Rate Notes that
reset monthly, the third Wednesday of each month; in the case of Floating
Rate Notes that reset quarterly, the third Wednesday of March, June,
September and December; and in the case of Floating Rate Notes that reset
semiannually, the third Wednesday of the two months specified in the
Supplement. If any Interest Reset Date for any Floating Rate Note is not a
Business Day, such Interest Reset Date will be postponed to the next day
that is a Business Day, except that in the case of a LIBOR Note, if such
Business Day is in the next succeeding calendar month, such Interest Reset
Date shall be the immediately preceding Business Day. Interest on each
Floating Rate Note will be payable monthly, quarterly or semiannually (the
"Interest Payment Period") and on the Maturity Date. Unless otherwise
specified in the Supplement, and except as provided below, the date or
dates on which interest will be payable (each an "Interest Payment Date"
for a Floating Rate Note) will be, in the case of Floating Rate Notes with
a monthly Interest Payment Period, on the third Wednesday of each month; in
the case of Floating Rate Notes with a quarterly Interest Payment Period,
on the third Wednesday of March, June, September and December; and in the
case of Floating Rate Notes with a semiannual Interest Payment Period, on
the third Wednesday of the two months specified in the Supplement. In
addition, the Maturity Date will also be an Interest Payment Date.
If any Interest Payment Date for any Floating Rate Note (other than an
Interest Payment Date occurring on the Maturity Date) would otherwise be a
day that is not a Business Day, such Interest Payment Date shall be
postponed to the next day that is a Business Day, except that in the case
of a LIBOR Note, if such Business Day is in the next succeeding calendar
month, such Interest Payment Date shall be the immediately preceding
Business Day. If the Maturity Date of a Floating Rate Note falls on a day
that is not a Business Day, the payment of principal and interest will be
made on the next succeeding Business Day, and no interest on such payment
shall accrue for the period from and after such maturity.
18
Interest payments on each Interest Payment Date for Floating Rate Notes
will include accrued interest from and including the Issue Date or from and
including the last date in respect of which interest has been paid, as the
case may be, to, but excluding, such Interest Payment Date. On the Maturity
Date, the interest payable on a Floating Rate Note will include interest
accrued to, but excluding, the Maturity Date. Accrued interest will be
calculated by multiplying the principal amount of a Floating Rate Note by
an accrued interest factor. This accrued interest factor will be computed
by adding the interest factors calculated for each day in the period for
which accrued interest is being calculated. The interest factor (expressed
as a decimal) for each such day will be computed by dividing the interest
rate applicable to such day by 360, in the cases where the Base Rate is the
CD Rate, Commercial Paper Rate, Federal Funds Rate, LIBOR or Prime Rate, or
by the actual number of days in the year, in the case where the Base Rate
is the Treasury Rate. The interest rate in effect on each day will be (i)
if such day is an Interest Reset Date, the interest rate with respect to
the Interest Determination Date (as defined below) pertaining to such
Interest Reset Date, or (ii) if such day is not an Interest Reset Date, the
interest rate with respect to the Interest Determination Date pertaining to
the next preceding Interest Reset Date, subject in either case to any
adjustment by a Spread and/or a Spread Multiplier.
The "Interest Determination Date" where the Base Rate is the CD Rate or the
Commercial Paper Rate will be the second Business Day next preceding an
Interest Reset Date. The Interest Determination Date where the Base Rate is
the Federal Funds Rate or the Prime Rate will be the Business Day next
preceding an Interest Reset Date. The Interest Determination Date where the
Base Rate is LIBOR will be the second London Business Day next preceding an
Interest Reset Date. The Interest Determination Date where the Base Rate is
the Treasury Rate will be the day of the week in which such Interest Reset
Date falls when Treasury Bills are normally auctioned. Treasury Bills are
normally sold at auction on Monday of each week, unless that day is a legal
holiday, in which case the auction is held on the following Tuesday or the
preceding Friday. If an auction is so held on the preceding Friday, such
Friday will be the Interest Determination Date pertaining to the Interest
Reset Date occurring in the next succeeding week.
The "Index Maturity" is the period to maturity of the instrument or
obligation from which the applicable Base Rate is calculated.
The "Calculation Date," where applicable, shall be the earlier of (i) the
tenth calendar day following the applicable Interest Determination Date or
(ii) the Business Day preceding the applicable Interest Payment Date or
Maturity Date.
All times referred to herein reflect New York City time, unless otherwise
specified.
The Issuer shall specify in writing to the Issuing and Paying Agent which
party will be the calculation agent (the "Calculation Agent") with respect
to the Floating Rate Notes. The Calculation Agent will provide the interest
rate then in effect and, if determined, the interest rate which will become
effective on the next Interest Reset Date with respect to such Floating
Rate Note to the Issuing and Paying Agent as soon as the interest rate with
respect to such Floating Rate Note has been determined and as soon as
practicable after any change in such interest rate.
19
All percentages resulting from any calculation on Floating Rate Notes will
be rounded to the nearest one hundred-thousandth of a percentage point,
with five-one millionths of a percentage point rounded upwards. For
example, 9.876545% (or .09876545) would be rounded to 9.87655% (or
.0987655). All dollar amounts used in or resulting from any calculation on
Floating Rate Notes will be rounded, in the case of U.S. dollars, to the
nearest cent or, in the case of a foreign currency, to the nearest unit
(with one-half cent or unit being rounded upwards).
CD Rate Notes
"CD Rate" means the rate on any Interest Determination Date for negotiable
certificates of deposit having the Index Maturity as published by the Board
of Governors of the Federal Reserve System (the "FRB") in "Statistical
Release H.15(519), Selected Interest Rates" or any successor publication of
the FRB ("H.15(519)") under the heading "CDs (Secondary Market)".
If the above rate is not published in H.15(519) by 3:00 p.m. on the
Calculation Date, the CD Rate will be the rate on such Interest
Determination Date set forth in the daily update of H.15(519), available
through the world wide website of the FRB at
http://www.federalreserve.gov/releases/h15/Update, or any successor site or
publication or other recognized electronic source used for the purpose of
displaying the applicable rate ("H.15 Daily Update") under the caption "CDs
(Secondary Market)".
If such rate is not published in either H.15(519) or H.15 Daily Update by
3:00 p.m. on the Calculation Date, the Calculation Agent will determine the
CD Rate to be the arithmetic mean of the secondary market offered rates as
of 10:00 a.m. on such Interest Determination Date of three leading nonbank
dealers(1) in negotiable U.S. dollar certificates of deposit in New York
City selected by the Calculation Agent for negotiable U.S. dollar
certificates of deposit of major United States money center banks of the
highest credit standing in the market for negotiable certificates of
deposit with a remaining maturity closest to the Index Maturity in the
denomination of $5,000,000.
If the dealers selected by the Calculation Agent are not quoting as set
forth above, the CD Rate will remain the CD Rate then in effect on such
Interest Determination Date.
Commercial Paper Rate Notes
"Commercial Paper Rate" means the Money Market Yield (calculated as
described below) of the rate on any Interest Determination Date for
commercial paper having the Index Maturity, as published in H.15(519) under
the heading "Commercial Paper-Nonfinancial".
If the above rate is not published in H.15(519) by 3:00 p.m. on the
Calculation Date, then the Commercial Paper Rate will be the Money Market
Yield of the rate on such Interest Determination Date for commercial paper
of the Index Maturity as published in H.15 Daily Update under the heading
"Commercial Paper-Nonfinancial".
If by 3:00 p.m. on such Calculation Date such rate is not published in
either H.15(519) or H.15 Daily Update, then the Calculation Agent will
determine the Commercial Paper Rate to be the Money Market Yield of the
arithmetic mean of the offered rates as of 11:00 a.m. on such Interest
(1) Such nonbank dealers referred to in this Statement of Terms may include
affiliates of the Dealer.
20
Determination Date of three leading dealers of U.S. dollar commercial paper
in New York City selected by the Calculation Agent for commercial paper of
the Index Maturity placed for an industrial issuer whose bond rating is
"AA," or the equivalent, from a nationally recognized statistical rating
organization.
If the dealers selected by the Calculation Agent are not quoting as
mentioned above, the Commercial Paper Rate with respect to such Interest
Determination Date will remain the Commercial Paper Rate then in effect on
such Interest Determination Date.
"Money Market Yield" will be a yield calculated in accordance with the
following formula:
D x 360
Money Market Yield = ------------- x 100
360 - (D x M)
where "D" refers to the applicable per annum rate for commercial paper
quoted on a bank discount basis and expressed as a decimal and "M" refers
to the actual number of days in the interest period for which interest is
being calculated.
Federal Funds Rate Notes
"Federal Funds Rate" means the rate on any Interest Determination Date for
federal funds as published in H.15(519) under the heading "Federal Funds
(Effective)" and displayed on Moneyline Telerate (or any successor service)
on page 120 (or any other page as may replace the specified page on that
service) ("Telerate Page 120").
If the above rate does not appear on Telerate Page 120 or is not so
published by 3:00 p.m. on the Calculation Date, the Federal Funds Rate will
be the rate on such Interest Determination Date as published in H.15 Daily
Update under the heading "Federal Funds/(Effective)".
If such rate is not published as described above by 3:00 p.m. on the
Calculation Date, the Calculation Agent will determine the Federal Funds
Rate to be the arithmetic mean of the rates for the last transaction in
overnight U.S. dollar federal funds arranged by each of three leading
brokers of Federal Funds transactions in New York City selected by the
Calculation Agent prior to 9:00 a.m. on such Interest Determination Date.
If the brokers selected by the Calculation Agent are not quoting as
mentioned above, the Federal Funds Rate will remain the Federal Funds Rate
then in effect on such Interest Determination Date.
LIBOR Notes
The London Interbank offered rate ("LIBOR") means, with respect to any
Interest Determination Date, the rate for deposits in U.S. dollars having
the Index Maturity that appears on the Designated LIBOR Page as of 11:00
a.m., London time, on such Interest Determination Date.
If no rate appears, LIBOR will be determined on the basis of the rates at
approximately 11:00 a.m., London time, on such Interest Determination Date
at which deposits in U.S. dollars are offered to
21
prime banks in the London interbank market by four major banks in such
market selected by the Calculation Agent for a term equal to the Index
Maturity and in principal amount equal to an amount that in the Calculation
Agent's judgment is representative for a single transaction in U.S. dollars
in such market at such time (a "Representative Amount"). The Calculation
Agent will request the principal London office of each of such banks to
provide a quotation of its rate. If at least two such quotations are
provided, LIBOR will be the arithmetic mean of such quotations. If fewer
than two quotations are provided, LIBOR for such interest period will be
the arithmetic mean of the rates quoted at approximately 11:00 a.m., in New
York City, on such Interest Determination Date by three major banks in New
York City, selected by the Calculation Agent, for loans in U.S. dollars to
leading European banks, for a term equal to the Index Maturity and in a
Representative Amount; provided, however, that if fewer than three banks so
selected by the Calculation Agent are providing such quotations, the then
existing LIBOR rate will remain in effect for such Interest Payment Period.
"Designated LIBOR Page" means the display designated as page "3750" on
Moneyline Telerate (or such other page as may replace the 3750 page on that
service or such other service or services as may be nominated by the
British Bankers' Association for the purposes of displaying London
interbank offered rates for U.S. dollar deposits).
Prime Rate Notes
"Prime Rate" means the rate on any Interest Determination Date as published
in H.15(519) under the heading "Bank Prime Loan".
If the above rate is not published in H.15(519) prior to 3:00 p.m. on the
Calculation Date, then the Prime Rate will be the rate on such Interest
Determination Date as published in H.15 Daily Update opposite the caption
"Bank Prime Loan".
If the rate is not published prior to 3:00 p.m. on the Calculation Date in
either H.15(519) or H.15 Daily Update, then the Calculation Agent will
determine the Prime Rate to be the arithmetic mean of the rates of interest
publicly announced by each bank that appears on the Reuters Screen US
PRIME1 Page (as defined below) as such bank's prime rate or base lending
rate as of 11:00 a.m., on that Interest Determination Date.
If fewer than four such rates referred to above are so published by 3:00
p.m. on the Calculation Date, the Calculation Agent will determine the
Prime Rate to be the arithmetic mean of the prime rates or base lending
rates quoted on the basis of the actual number of days in the year divided
by 360 as of the close of business on such Interest Determination Date by
three major banks in New York City selected by the Calculation Agent.
If the banks selected are not quoting as mentioned above, the Prime Rate
will remain the Prime Rate in effect on such Interest Determination Date.
"Reuters Screen US PRIME1 Page" means the display designated as page "US
PRIME1" on the Reuters Monitor Money Rates Service (or such other page as
may replace the US PRIME1 page on that service for the purpose of
displaying prime rates or base lending rates of major United States banks).
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Treasury Rate Notes
"Treasury Rate" means:
(1) the rate from the auction held on the Interest Determination Date (the
"Auction") of direct obligations of the United States ("Treasury Bills")
having the Index Maturity specified in the Supplement under the caption
"INVESTMENT RATE" on the display on Moneyline Telerate (or any successor
service) on page 56 (or any other page as may replace that page on that
service) ("Telerate Page 56") or page 57 (or any other page as may replace
that page on that service) ("Telerate Page 57"), or
(2) if the rate referred to in clause (1) is not so published by 3:00 p.m.
on the related Calculation Date, the Bond Equivalent Yield (as defined
below) of the rate for the applicable Treasury Bills as published in H.15
Daily Update, under the caption "U.S. Government Securities/Treasury
Bills/Auction High", or
(3) if the rate referred to in clause (2) is not so published by 3:00 p.m.
on the related Calculation Date, the Bond Equivalent Yield of the auction
rate of the applicable Treasury Bills as announced by the United States
Department of the Treasury, or
(4) if the rate referred to in clause (3) is not so announced by the United
States Department of the Treasury, or if the Auction is not held, the Bond
Equivalent Yield of the rate on the particular Interest Determination Date
of the applicable Treasury Bills as published in H.15(519) under the
caption "U.S. Government Securities/Treasury Bills/Secondary Market", or
(5) if the rate referred to in clause (4) is not so published by 3:00 p.m.
on the related Calculation Date, the rate on the particular Interest
Determination Date of the applicable Treasury Bills as published in H.15
Daily Update, under the caption "U.S. Government Securities/Treasury
Bills/Secondary Market", or
(6) if the rate referred to in clause (5) is not so published by 3:00 p.m.
on the related Calculation Date, the rate on the particular Interest
Determination Date calculated by the Calculation Agent as the Bond
Equivalent Yield of the arithmetic mean of the secondary market bid rates,
as of approximately 3:30 p.m. on that Interest Determination Date, of three
primary United States government securities dealers selected by the
Calculation Agent, for the issue of Treasury Bills with a remaining
maturity closest to the Index Maturity specified in the Supplement, or
(7) if the dealers so selected by the Calculation Agent are not quoting as
mentioned in clause (6), the Treasury Rate in effect on the particular
Interest Determination Date.
"Bond Equivalent Yield" means a yield (expressed as a percentage) calculated in
accordance with the following formula:
D x N
Bond Equivalent Yield = ------------- x 100
360 - (D x M)
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where "D" refers to the applicable per annum rate for Treasury Bills quoted
on a bank discount basis and expressed as a decimal, "N" refers to 365 or
366, as the case may be, and "M" refers to the actual number of days in the
applicable Interest Reset Period.
3. Final Maturity. The Stated Maturity Date for any Note will be the date so
specified in the Supplement, which shall be no later than 270 days from the
date of issuance. On its Stated Maturity Date, or any date prior to the
Stated Maturity Date on which the particular Note becomes due and payable
by the declaration of acceleration, each such date being referred to as a
Maturity Date, the principal amount of each Note, together with accrued and
unpaid interest thereon, will be immediately due and payable.
4. Events of Default. The occurrence of any of the following shall constitute
an "Event of Default" with respect to a Note: (i) default in any payment of
principal of or interest on such Note (including on a redemption thereof);
(ii) the Issuer makes any compromise arrangement with its creditors
generally including the entering into any form of moratorium with its
creditors generally; (iii) a court having jurisdiction shall enter a decree
or order for relief in respect of the Issuer in an involuntary case under
any applicable bankruptcy, insolvency or other similar law now or hereafter
in effect, or there shall be appointed a receiver, administrator,
liquidator, custodian, trustee or sequestrator (or similar officer) with
respect to the whole or substantially the whole of the assets of the Issuer
and any such decree, order or appointment is not removed, discharged or
withdrawn within 60 days thereafter; or (iv) the Issuer shall commence a
voluntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or consent to the entry of an order for
relief in an involuntary case under any such law, or consent to the
appointment of or taking possession by a receiver, administrator,
liquidator, assignee, custodian, trustee or sequestrator (or similar
official), with respect to the whole or substantially the whole of the
assets of the Issuer or make any general assignment for the benefit of
creditors. Upon the occurrence of an Event of Default, the principal of
each obligation evidenced by such Note (together with interest accrued and
unpaid thereon) shall become, without any notice or demand, immediately due
and payable.(2)
5. Obligation Absolute. No provision of the Issuing and Paying Agency
Agreement under which the Notes are issued shall alter or impair the
obligation of the Issuer, which is absolute and unconditional, to pay the
principal of and interest on each Note at the times, place and rate, and in
the coin or currency, herein prescribed.
6. Supplement. Any term contained in the Supplement shall supercede any
conflicting term contained herein.
(2) Unlike single payment notes, where a default arises only at the stated
maturity, interest-bearing notes with multiple payment dates should contain
a default provision permitting acceleration of the maturity if the Issuer
defaults on an interest payment.
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EXHIBIT D
In the case of any agreement by the Dealer to purchase a Note hereunder
(other than as agent) which provides for a settlement date that is three New
York Business Days or more after the date of such agreement, the obligation of
the Dealer to purchase the Note under such agreement shall be subject to the
following conditions:
(a) the representations and warranties given by the Issuer set forth above
in Section 1.8 and Section 2 shall be true and correct on and as of
the settlement date as if made on and as of such date, and the Issuer
shall have performed all of its obligations hereunder to be performed
as of such date,
(b) since the date of the most recent Private Placement Memorandum, there
shall have been no material adverse change in the condition (financial
or otherwise), operations or business prospects of the Issuer (whether
occurring before or after such agreement was entered into) which was
not disclosed to the Dealer in writing prior to the time such
agreement was entered into,
(c) the Issuer shall not be in default of any of its obligations
hereunder, under the Notes or under the Issuing and Paying Agency
Agreement,
(d) on or after the date of such agreement 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; ; (ii)
a suspension or material limitation in trading in the Issuer's
securities on the New York Stock Exchange; (iii) a general moratorium
on commercial banking activities declared by either Federal or New
York authorities or a material disruption in commercial banking or
securities settlement or clearance services in the United States; (iv)
the outbreak or escalation of hostilities involving the United States
or the declaration by the United States of a national emergency or war
or (v) the occurrence of any other calamity or crisis or any change in
financial, political or economic conditions in the United States or
elsewhere, if the effect of any such event specified in clause (iv) or
(v) in the judgment of the Dealer makes it impracticable or
inadvisable to proceed with the offering or the delivery of the Note
on the terms and in the manner contemplated in the Private Placement
Memorandum, and
(e) on or after the date of such agreement, (i) no downgrading shall have
occurred in the rating accorded the Issuer's debt securities by any
nationally recognized statistical rating organization and (ii) no such
organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its
rating of any of the Issuer's debt securities.
"New York Business Day" shall mean each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in New York are
generally authorized or obligated by law or executive order to close.
25