Exhibit 4.2
[Face of Note]
CUSIP NO. PRINCIPAL AMOUNT: $
REGISTERED NO.
DAYTON HUDSON CORPORATION
FORM OF
MEDIUM-TERM FLOATING RATE NOTE, SERIES I
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
/ / Check box if this Security is a Global Security.
Applicable if this Security is a Global Security:
[Unless this certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation (55 Water Street, New York,
New York) ("DTC"), to the Issuer or its agent for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of
Cede & Co. or in such other name as requested by an authorized representative of
DTC (and any payment is made to Cede & Co. or such other entity as is requested
by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the
registered owner hereof, Cede & Co., has an interest herein.]
[If applicable, this Security will contain information required by U.S.
Federal Income Tax "Original Issue Discount" rules, as that term is defined in
the Internal Revenue Code of 1986, as amended.]
ORIGINAL ISSUE DATE: ISSUE PRICE: % STATED MATURITY DATE:
BASE RATE: INITIAL INTEREST RATE: INTEREST PAYMENT DATES:
REGULAR RECORD DATES: INTEREST DETERMINATION CALCULATION DATES:
DATES:
MAXIMUM RATE: MINIMUM RATE: INTEREST RESET PERIOD:
INTEREST RESET DATES: INITIAL INTEREST RESET SPREAD MULTIPLIER:
DATE:
SPREAD: + INDEX MATURITY: DESIGNATED CMT MATURITY
- INDEX AND DESIGNATED
TELERATE PAGE
(Only applicable if the Base
Rate is CMT):
DESIGNATED LIBOR PAGE INDEX CURRENCY CALCULATION AGENT:
(Only applicable if the (Only applicable if
Base Rate is LIBOR): the Base Rate is LIBOR):
/ / LIBOR Telerate (p. __)
/ / LIBOR Reuters (p. __)
OPTIONAL REDEMPTION INITIAL REDEMPTION DATE INITIAL REDEMPTION
(at option of Company): (at option of Company): PERCENTAGE:
ANNUAL REDEMPTION SINKING FUND: OPTION TO ELECT REPAYMENT:
PERCENTAGE REDUCTION:
OPTIONAL REPAYMENT MINIMUM DENOMINATIONS: DEPOSITARY
DATE(S): / / $1,000 (Only applicable if this
/ / Other Security is a Global
Security):
OTHER TERMS:
DAYTON HUDSON CORPORATION, a corporation duly organized and existing under
the laws of the State of Minnesota (herein called the "Company", which term
includes any successor corporation under the Indenture hereinafter referred to),
for value received, hereby promises to pay to ______________________________, or
registered assigns, the principal sum of
__________________________________Dollars ($_____________) on the Stated
Maturity Date shown above (except to the extent redeemed or repaid prior to such
date) and to pay interest, if any, on the Interest Payment Dates specified
above, commencing with the first Interest Payment Date specified above following
the Original Issue Date specified above, and at Maturity, on the principal
amount hereof at such offices and agencies, at a rate per annum equal to the
Initial Interest Rate specified above until the Initial Interest Reset Date
specified above following the Original Issue Date specified above and thereafter
at a rate per annum determined in accordance with the provisions on the reverse
hereof under the heading "Determination of CD Rate", "Determination of
Commercial Paper Rate", "Determination of Federal Funds Rate", "Determination of
LIBOR", "Determination of Prime Rate", "Determination of Treasury Rate" or
"Determination of CMT Rate", depending
2
upon whether the Base Rate is CD Rate, Commercial Paper Rate, Federal Funds
Rate, LIBOR, Prime Rate, Treasury Rate or CMT Rate, as specified above.
Any Interest Payment Date specified above that would fall on a day that is
not a Business Day, other than an Interest Payment Date that is also the date of
Maturity, shall be the following day that is a Business Day, except that, if the
Base Rate specified above is LIBOR and such following Business Day is in the
next calendar month, such Interest Payment Date shall be the immediately
preceding day that is a Business Day. If the date of Maturity would fall on a
day that is not a Business Day, the payment of principal and any premium and
interest shall be made on the following Business Day, with the same force and
effect as if made on the due date, and no additional interest shall accrue on
the amount so payable for the period from and after such date of Maturity. For
purposes of this Security, "Business Day" means (a) any day other than a
Saturday, Sunday or a legal holiday or a day on which banking institutions are
authorized or required by law or regulation to close in New York City or
Chicago, Illinois, and (b) if the Base Rate specified above is LIBOR, any such
day which is also a London Banking Day. For purposes of this Security, ("London
Banking Day" means any day on which dealings in deposits in the Index Currency
specified above are transacted in the London interbank market).
Interest payments on this Security shall be the amount of interest accrued
from and including the Original Issue Date specified above or from and including
the last date to which interest has been paid, or provided for, as the case may
be, to but excluding, the following Interest Payment Date or the date of
Maturity. If this Security has been issued upon transfer of, in exchange for,
or in replacement of, a Predecessor Security, interest on this Security shall
accrue from the last Interest Payment Date to which interest was paid on such
Predecessor Security or, if no interest was paid on such Predecessor Security,
from the Original Issue Date specified above.
Subject to certain exceptions provided in the Indenture referred to on the
reverse hereof, the interest so payable on any Interest Payment Date shall be
paid to the Person in whose name this Security is registered at the close of
business on the Regular Record Date (whether or not a Business Day) next
preceding such Interest Payment Date, and interest payable upon the Maturity
(whether or not such date of Maturity is an Interest Payment Date) shall be paid
to the Person to whom principal is payable; provided, however, that the first
payment of interest on a Security originally issued and dated between a Regular
Record Date specified above and an Interest Payment Date shall be due and
payable on the Interest Payment Date following the next succeeding Regular
Record Date to the registered owner on such next succeeding Regular Record Date.
Unless otherwise specified on the face hereof, "Regular Record Date" shall mean
the fifteenth calendar day (whether or not a Business Day) immediately preceding
the related Interest Payment Date.
Any interest not punctually paid or duly provided for shall forthwith cease
to be payable to the Holder on such Regular Record Date and may either be paid
to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of
3
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders of Securities
of this series not less than 10 days prior to such Special Record Date, or be
paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities of this series
may be listed, and upon such notice as may be required by such exchange, all as
more fully provided in the Indenture.
Until this Security is paid in full or payment therefor in full is duly
provided for, the Company shall at all times maintain a Paying Agent (which
Paying Agent may be the Trustee) in New York City and Chicago, Illinois. The
Company has initially appointed The First National Bank of Chicago as the Paying
Agent at its offices at One First National Plaza, Suite 0126, Chicago, Illinois
60670 and at 14 Wall Street, 8th Floor, Window 2, New York, New York 10005.
If this Security is a Global Security: Payments of principal and any
premium and interest on this Security shall be made to DTC or its nominee, as
Holder of this Security, by wire transfer of immediately available funds.
If this Security is not a Global Security: Payment of interest on this
Security (other than payments of interest at Maturity) shall be made by check
mailed to the Person entitled thereto at such Person's last address as it
appears in the Security Register or, in the case of a Holder of $50,000,000 or
more in aggregate principal amount of Securities of this series, by wire
transfer of immediately available funds to such account as may have been
designated by such Holder. Any such designation for wire transfer purposes
shall be made by filing the appropriate information with the Paying Agent at its
corporate trust office not later than 15 calendar days prior to the applicable
Interest Payment Date and, unless revoked by written notice to the Paying Agent
received by the Paying Agent on or prior to the Regular Record Date immediately
preceding the applicable Interest Payment Date, shall remain in effect with
respect to any further payments with respect to this Security payable to such
Holder. Payment of principal of and interest, if any, on this Security at
Maturity shall be made against presentation of this Security at the office or
agency of the Company maintained for that purpose in New York City or Chicago,
Illinois.
The Company shall pay any administrative costs imposed by banks on payors
in making payments on this Security in immediately available funds and the
Holder of this Security will pay any administrative costs imposed by banks on
payees in connection with such payments. Any tax, assessment or governmental
charge imposed upon payments on this Security shall be borne by the Holder of
this Security.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
4
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
5
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
DATED:
--------------------
DAYTON HUDSON CORPORATION
By:
------------------------------------------
Its:
---------------------------------------
[SEAL]
Attest:
--------------------------------------
Its:
---------------------------------------
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the
series designated therein referred to
in the within-mentioned Indenture.
THE FIRST NATIONAL BANK OF CHICAGO,
as Trustee
By:
----------------------------------
Authorized Signature
6
[Reverse of Note]
DAYTON HUDSON CORPORATION
MEDIUM-TERM FLOATING RATE NOTE, SERIES I
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
GENERAL
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or more
series under an indenture dated as of October 3, 1996, as amended or
supplemented from time to time (herein called the "Indenture"), between the
Company and The First National Bank of Chicago, as Trustee (herein called the
"Trustee", which term includes any successor trustee under the Indenture), to
which Indenture and all indentures supplemental thereto, reference is hereby
made for a statement of the respective rights, limitations of rights, duties and
immunities thereunder of the Company, the Trustee and the Holders of the
Securities, and of the terms upon which the Securities are, and are to be,
authenticated and delivered. This Security is one of the series of the
Securities, which series is limited to an aggregate principal amount of
$1,325,000,000 or the equivalent thereof in one or more foreign or composite
currencies, designated as Medium-Term Notes, Series I, of the Company. The
Securities of this series may mature at different times, bear interest, if any,
at different rates, be redeemable at different times or not at all, be repayable
at the option of the Holder at different times or not at all, be issued at an
original issue discount and be denominated in different currencies.
INTEREST RATE RESET
The interest rate in effect from the Original Issue Date to the Initial
Interest Reset Date specified on the face hereof shall be the Initial Interest
Rate specified on the face hereof. Commencing with the Initial Interest Reset
Date specified on the face hereof following the Original Issue Date specified on
the face hereof, the rate at which interest on this Security is payable shall be
adjusted daily, weekly, monthly, quarterly, semi-annually or annually as
specified on the face hereof under "Interest Reset Period". Each such adjusted
rate shall be applicable from and including the Interest Reset Date to which it
relates to but not including the next succeeding Interest Reset Date or until
Maturity, as the case may be. Subject to applicable provisions of law and
except as specified herein, on each Interest Reset Date, the rate of interest on
this Security shall be the rate determined with respect to the Interest
Determination Date next preceding such Interest Reset Date in accordance with
the provisions of the applicable heading below and adjusted by the addition or
subtraction of the Spread, if any, specified on the face hereof, and/or by the
multiplication by the Spread Multiplier, if any, specified on the face hereof.
7
If any Interest Reset Date would otherwise be a day that is not a Business
Day, such Interest Reset Date shall be the following Business Day, except that
if the Base Rate specified above is LIBOR and if such following Business Day is
in the next calendar month, such Interest Reset Date shall be the immediately
preceding Business Day.
Accrued interest shall be calculated by multiplying the principal amount by
an accrued interest factor. Such accrued interest factor shall be computed by
adding the interest factor calculated for each day in the period for which
interest is being paid. Unless otherwise specified on the face hereof, the
interest factor for each such day will be computed by dividing the interest rate
(expressed as a decimal) applicable to such day by 360, if the Base Rate is the
CD Rate, the Commercial Paper Rate, the Federal Funds Rate, LIBOR or the Prime
Rate or by the actual number of days in the year, if the Base Rate is the
Treasury Rate or the CMT Rate.
Unless otherwise specified on the face hereof, all percentages resulting
from any calculation referred to herein shall be rounded, if necessary, to the
nearest one hundred-thousandth of a percentage point, with five one-millionths
of one percentage point rounded upward (e.g., 9.876545% (or. 09876545) being
rounded to 9.87655% (or .0987655) and 9.876544% (or .09876544) being rounded to
9.87654% (or .0987654)), and all dollar amounts used in or resulting from any
such calculation on this Security shall be rounded to the nearest cent (with
one-half cent being rounded upwards).
Notwithstanding the foregoing, the interest rate per annum hereon shall not
be greater than the Maximum Interest Rate, if any, or less than the Minimum
Interest Rate, if any, specified on the face hereof. The Calculation Agent
shall calculate the interest rate hereon in accordance with the foregoing on or
before each Calculation Date.
The interest rate on this Security shall in no event be higher than the
maximum rate permitted by Minnesota law, as the same may be modified by United
States law of general application.
At the request of the Holder hereof, the Calculation Agent shall provide to
the Holder hereof the interest rate hereon then in effect and, if determined,
the interest rate that shall become effective on the next Interest Reset Date
with respect to this Security. The Calculation Agent's determination of any
interest rate shall be final and binding in the absence of manifest error.
DETERMINATION OF CD RATE
If the Base Rate specified on the face hereof is CD Rate, the interest rate
per annum determined with respect to any Interest Determination Date specified
on the face hereof (each, a "CD Interest Determination Date") shall equal the
rate on such date for negotiable certificates of deposit having the specified
Index Maturity as published by the Board of Governors of the Federal Reserve
System in "Statistical Release H.15(519), Selected Interest
8
Rates" or any successor publication of the Board of Governors of the Federal
Reserve System ("H.15(519)") under the heading "CDs (Secondary Market)."
The following procedures shall be followed if the CD Rate cannot be
determined as described above:
- If the above rate is not published in H.15(519) by 9:00 a.m., New York
City time, on the Calculation Date, the CD Rate shall be the rate on
the applicable CD Interest Determination Date set forth in the daily
update of H.15(519), available through the world wide website of the
Board of Governors of the Federal Reserve System at
http://www.bog.frb.fed.us/releases/h15/update, or any successor site
or publication ("H.15 Daily Update"), or another recognized electronic
source used for the purpose of displaying this rate, for the day in
respect of certificates of deposit having the Index Maturity specified
on the face hereof under the caption "CDs (secondary market)."
- If such rate is not yet published in either H.15(519) or the H.15
Daily Update or another recognized electronic source by 3:00 p.m., New
York City time, on the Calculation Date, then the Calculation Agent
shall determine the CD Rate to be the arithmetic mean of the secondary
market offered rates as of 10:00 a.m., New York City time, on such CD
Interest Determination Date of three leading nonbank dealers in
negotiable U.S. dollar certificates of deposit in New York City
selected by the Calculation Agent for negotiable certificates of
deposit in a denomination of $5,000,000 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 specified on the face hereof.
- If the dealers selected by the Calculation Agent are not quoting as
mentioned immediately above, the CD Rate in effect immediately prior
to such CD Interest Determination Date shall not change and shall
remain the CD Rate in effect on such CD Interest Determination Date.
DETERMINATION OF COMMERCIAL PAPER RATE
If the Base Rate specified on the face hereof is Commercial Paper Rate, the
interest rate per annum determined with respect to any Interest Determination
Date specified on the face hereof (each, a "Commercial Paper Interest
Determination Date") shall equal the Money Market Yield (calculated as described
below) of the rate on such date for commercial paper having the Index Maturity
specified on the face hereof as published in H.15(519) under the heading
"Commercial Paper--Nonfinancial."
9
The following procedures shall be followed if the Commercial Paper Rate
cannot be determined as described above:
- If the above rate is not published by 9:00 a.m., New York City time,
on the Calculation Date, then the Commercial Paper Rate shall be the
Money Market Yield of the rate on the applicable Commercial Paper
Interest Determination Date for commercial paper having the Index
Maturity specified on the face hereof as published in H.15 Daily
Update, or another recognized electronic source used for the purpose
of displaying this rate, under the heading "Commercial
Paper--Nonfinancial."
- If by 3:00 p.m., New York City time, on such Calculation Date such
rate is not yet published in either H.15(519) or H.15 Daily Update or
another recognized electronic source, then the Calculation Agent shall
determine the Commercial Paper Rate to be the Money Market Yield of
the arithmetic mean of the offered rates of 11:00 a.m., New York City
time, on such Commercial Paper Interest Determination Date of three
leading dealers of commercial paper in New York City selected by the
Calculation Agent for commercial paper having the Index Maturity
specified on the face hereof placed for an industrial issuer whose
bond rating is "Aa," or the equivalent, from a nationally recognized
statistical rating agency.
- If the dealers selected by the Calculation Agent are not quoting as
mentioned immediately above, the Commercial Paper Rate in effect
immediately prior to such Commercial Paper Interest Determination Date
shall not change and shall remain the Commercial Paper Rate in effect
on such Commercial Paper 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.
DETERMINATION OF FEDERAL FUNDS RATE
If the Base Rate specified on the face hereof is Federal Funds Rate, the
interest rate per annum determined with respect to any Interest Determination
Date specified on the face hereof (each, a "Federal Funds Interest Determination
Date") shall equal the rate on that day for federal funds as published in
H.15(519) under the heading "Federal Funds (Effective)."
10
The following procedures shall be followed if the Federal Funds Rate cannot
be determined as described above:
- If the above rate is not published by 9:00 a.m., New York City time,
on the Calculation Date, the Federal Funds Rate shall be the rate on
the applicable Federal Funds Interest Determination Date as published
in H.15 Daily Update, or another recognized electronic source used for
the purpose of displaying this rate, under the heading "Federal
Funds/(Effective)."
- If such rate is not yet published in either H.15(519) or H.15 Daily
Update or another recognized electronic source by 3:00 p.m., New York
City time, on the Calculation Date, the Calculation Agent shall
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 U.S. dollar Federal Funds
transactions in New York City selected by the Calculation Agent prior
to 9:00 a.m., New York City time, on such Federal Funds Interest
Determination Date.
- If the brokers selected by the Calculation Agent are not quoting as
mentioned above, the Federal Funds Rate in effect immediately prior to
such Federal Funds Interest Determination Date shall not change and
shall remain the Federal Funds Rate in effect on such Federal Funds
Interest Determination Date.
DETERMINATION OF LIBOR
If the Base Rate specified on the face hereof is the London interbank
offered rate ("LIBOR"), the interest rate per annum determined with respect to
any Interest Determination Date specified on the face hereof (each, a "LIBOR
Interest Determination Date") shall be determined by the Calculation Agent as
follows:
- As of the LIBOR Interest Determination Date, LIBOR shall be either:
- if "LIBOR Reuters" is specified on the face hereof, the arithmetic
mean of the offered rates (unless the Designated LIBOR Page (as
defined below) by its terms provides only for a single rate, in
which case such single rate shall be used) for deposits in the
Index Currency (as defined below) having the Index Maturity
specified on the face hereof, commencing on the applicable
Interest Reset Date, that appear (or, if only a single rate is
provided as aforesaid, appears) on the Designated LIBOR Page as of
11:00 a.m., London time, on such LIBOR Interest Determination
Date; or
- if "LIBOR Telerate" is specified on the face hereof or if neither
"LIBOR Reuters" nor "LIBOR Telerate" is specified on the face
hereof as the
11
method for calculating LIBOR, the rate for deposits in the Index
Currency having the Index Maturity specified on the face hereof,
commencing on such Interest Reset Date, that appears on the
Designated LIBOR Page as of 11:00 a.m., London time, on such LIBOR
Interest Determination Date.
If fewer than the required number of applicable rates appear, LIBOR on such
LIBOR Interest Determination Date shall be determined in accordance with
the provisions described immediately below.
- With respect to a LIBOR Interest Determination Date on which fewer than
the required number of applicable rates appear on the Designated LIBOR
Page as specified immediately above, the Calculation Agent will request
the principal London offices of each of four major reference banks in
the London interbank market, as selected by the Calculation Agent, to
provide the Calculation Agent with its offered quotation for deposits
in the Index Currency for the period of the Index Maturity specified on
the face hereof, commencing on the applicable Interest Reset Date, to
prime banks in the London interbank market at approximately 11:00 a.m.,
London time, on such LIBOR Interest Determination Date and in a
principal amount not less than $1,000,000 (or the equivalent in the
Index Currency as applicable) that is representative for a single
transaction in such Index Currency in such market at such time. If at
least two quotations are so provided, then LIBOR on such LIBOR Interest
Determination Date shall be the arithmetic mean of such quotations.
- If only one or no such quotations are so provided, then LIBOR on such
LIBOR Interest Determination Date shall be the arithmetic mean of the
rates quoted at approximately 11:00 a.m., in the applicable principal
financial center for the country of the Index Currency, on such LIBOR
Interest Determination Date by three major banks in such principal
financial center selected by the Calculation Agent for loans in the
Index Currency to leading European banks, having the Index Maturity
specified on the face hereof and in a principal amount not less than
$1,000,000 (or the equivalent in the Index Currency as applicable) that
is representative for a single transaction in such Index Currency in
such market at such time.
- If the banks so selected by the Calculation Agent are not quoting as
mentioned immediately above, LIBOR in effect immediately prior to such
LIBOR Interest Determination Date shall not change and shall remain the
LIBOR in effect on such LIBOR Interest Determination Date.
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For purposes of the preceding discussion, the following capitalized terms
have the following meanings:
"Index Currency" means the currency specified on the face hereof (which may
be a composite currency) for which LIBOR shall be calculated. If no such
currency is specified, the Index Currency shall be U.S. dollars.
"Designated LIBOR Page" means:
- if "LIBOR Reuters" is designated on the face hereof, the display on
the Reuters Monitor Money Rates Service (or any successor service) on
the page specified on the face hereof (or any other page as may
replace such page or such service (or any successor service)) for the
purpose of displaying the London interbank rates of major banks for
the applicable Index Currency; or
- if "LIBOR Telerate" is designated on the face hereof or neither "LIBOR
Reuters" nor "LIBOR Telerate" is designated on the face hereof as the
method for calculating LIBOR, the display on Dow Jones Markets Limited
(or any successor service) on page 3750 if the U.S. dollar is the
Index Currency or with respect to any other Index Currency, on the
page specified on the face hereof (or any other page as may replace
such page or such service (or any successor service)) for the purpose
of displaying the London interbank rates of major banks for the
applicable Index Currency.
DETERMINATION OF PRIME RATE
If the Base Rate specified on the face hereof is Prime Rate, the interest
rate per annum determined with respect to any Interest Determination Date
specified on the face hereof (each, a "Prime Interest Determination Date") shall
equal the rate on such date as published in H.15(519) under the heading "Bank
Prime Loan."
The following procedures shall be followed if the Prime Rate cannot be
determined as described above:
- If the rate is not published prior to 9:00 a.m., New York City time,
on the Calculation Date, then the Prime Rate shall be the rate on such
Prime Interest Determination Date as published in H.15 Daily Update,
or another recognized electronic source used for the purpose of
displaying this rate, opposite the caption "Bank Prime Loan."
- If the rate is not published prior to 3:00 p.m., New York City time,
on the Calculation Date, in either H.15(519) or H.15 Daily Update or
another recognized electronic source, then the Calculation Agent shall
determine the Prime Rate to be the arithmetic mean of the rates of
interest publicly
13
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 in effect for that Prime Interest Determination Date.
- If fewer than four rates appear on the Reuters Screen US Prime 1 Page
on such Prime Rate Interest Determination Date, then the Calculation
Agent shall 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 Prime Interest Determination Date by at least three major
money center banks in New York City selected by the Calculation Agent.
- If the banks selected are not quoting as mentioned immediately above,
the Prime Rate in effect immediately prior to such Prime Interest
Determination Date shall not change and shall remain the Prime Rate in
effect on such Prime Interest Determination Date.
"Reuters Screen US Prime1 Page" means the display designated as page
"USPrime1" 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).
DETERMINATION OF TREASURY RATE
If the Base Rate specified on the face hereof is Treasury Rate, the
interest rate per annum determined with respect to any Interest Determination
Date specified on the face hereof (each, a "Treasury Interest Determination
Date") shall equal the rate applicable to the auction held on such date of
direct obligations of the United States ("Treasury bills") having the Index
Maturity specified on the face hereof under the caption "Investment Rate" on the
display on Bridge Telerate, Inc. (or any successor service) on page 56 (or any
other page as may replace such page on such service ) ("Telerate Page 56") or
page 57 (or any other page as may replace such page on such service) ("Telerate
Page 57") or, if not so published by 3:00 p.m., New York City time, on the
related Calculation Date, the Bond Equivalent Yield (as hereinafter defined) of
the rate for such Treasury bills as published in H.15(519) Daily Update, or such
other recognized electronic source used for the purpose of displaying such rate,
under the heading "U.S. Government Securities/Treasury Bills/Auction High".
The following procedures shall be followed if the Treasury Rate cannot be
determined as described above:
- If the above rate is not published by 3:00 p.m., New York City time,
on the Calculation Date, the Treasury Rate shall be the Bond
Equivalent Yield of the auction rate of such Treasury bills on such
Treasury Interest Determination Date as announced by the United States
Department of the Treasury.
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- In the event that the auction rate of Treasury bills having the Index
Maturity specified on the face hereof is not published or announced as
provided above by 3:00 p.m., New York City time, on such Calculation
Date, or if no such auction is held on such Treasury Interest
Determination Date, then the Calculation Agent shall determine the
Treasury Rate to be the Bond Equivalent Yield of the rate on such
Treasury Rate Interest Determination Date of Treasury bills having the
Index Maturity specified on the face hereof as published in H.15(519)
under the caption "U.S. Government Securities/Treasury Bills/Secondary
Market" or, if not yet published by 3:00 p.m., New York City time, on
the related Calculation Date, the rate on such Treasury Rate Interest
Determination Date of such Treasury bills as published in H.15 Daily
Update, or such other recognized electronic source used for the
purpose of displaying such rate, under the caption "U.S. Government
Securities/Treasury Bills/Secondary Market." If such rate is not yet
published in H.15(519), H.15 Daily Update or another recognized
electronic source, then the Treasury Rate shall be calculated by the
Calculation Agent and shall be the Bond Equivalent Yield of the
arithmetic mean of the secondary market bid rates, as of approximately
3:30 p.m., New York City time, on such Treasury Interest Determination
Date, of three leading 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 on the face hereof.
- If the dealers selected by the Calculation Agent are not quoting as
mentioned immediately above, the Treasury Rate in effect immediately
prior to such Treasury Interest Determination Date shall not change
and shall remain the Treasury Rate in effect on such Treasury 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)
where "D" refers to the applicable per annum rate for the security 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 interest period
for which interest is being calculated.
DETERMINATION OF CMT RATE
If the Base Rate specified on the face hereof is CMT Rate, the interest
rate per annum determined with respect to any Interest Determination Date
specified on the face hereof
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(each, a "CMT Interest Determination Date") shall equal the rate displayed on
the Designated CMT Telerate Page (as defined below) under the caption "Treasury
Constant Maturities . . . Federal Reserve Board Release H.15 . . . Mondays
Approximately 3:45 p.m.," under the column for the Designated CMT Maturity Index
(as defined below) for:
(i) if the Designated CMT Telerate Page is 7051, such CMT Interest
Determination Date; and
(ii) if the Designated CMT Telerate Page is 7052, the week or the
month, as applicable, ended immediately before the week in which the
related CMT Interest Determination Date occurs.
The following procedures shall be used if the CMT Rate cannot be determined
as described above:
- If such rate is no longer displayed on the relevant page, or if not
displayed by 3:00 p.m., New York City time, on the related Calculation
Date, then the CMT Rate shall be such treasury constant maturity rate
for the Designated CMT Maturity Index (as defined below) as published
in H.15(519).
- If that rate is no longer published, or if not published by 3:00 p.m.,
New York City time, on the related Calculation Date, then the CMT Rate
shall be such treasury constant maturity rate for the Designated CMT
Maturity Index (or other United States Treasury rate for the
Designated CMT Maturity Index) for the CMT Interest Determination Date
with respect to such Interest Reset Date as may then be published by
either the Board of Governors of the Federal Reserve System or the
United States Department of the Treasury that the Calculation Agent
determines to be comparable to the rate formerly displayed on the
Designated CMT Telerate Page and published in H.15(519).
- If such information is not provided by 3:00 p.m., New York City time,
on the related Calculation Date, then the Calculation Agent shall
determine the CMT Rate to be a yield to maturity, based on the
arithmetic mean of the secondary market closing offer side prices as
of approximately 3:30 p.m., New York City time, on the CMT Interest
Determination Date reported, according to their written records, by
three leading primary United States government securities dealers
(each, a "Reference Dealer") in New York City selected by the
Calculation Agent as described in the following sentence. The
Calculation Agent shall select five Reference Dealers and shall
eliminate the highest quotation (or, in the event of overlap, one of
the highest) and the lowest quotation (or, in the event of overlap,
one of the lowest), for the most recently issued direct noncallable
fixed rate obligations of the United States ("Treasury notes") with an
original maturity of approximately the Designated CMT
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Maturity Index and a remaining term to maturity of not less than such
Designated CMT Maturity Index minus one year.
- If the Calculation Agent cannot obtain three such Treasury notes
quotations, the Calculation Agent shall determine the CMT Rate to be a
yield to maturity based on the arithmetic mean of the secondary market
offer side prices as of approximately 3:30 p.m., New York City time,
on the CMT Interest Determination Date of three Reference Dealers in
New York City (selected using the same method described above) for
Treasury notes with an original maturity of the number of years that
is the next highest to the Designated CMT Maturity Index and a
remaining term to maturity closest to the Designated CMT Maturity
Index and in an amount of at least $100,000,000. If two Treasury
notes with an original maturity as described above have remaining
terms to maturity equally close to the Designated CMT Maturity Index,
the Calculation Agent shall obtain quotations for the Treasury note
with the shorter remaining term to maturity.
- If three or four (but not five) of such Reference Dealers are quoting
as described above, then the CMT Rate shall be based on the arithmetic
mean of the offer prices obtained and neither the highest nor the
lowest of such quotes shall be eliminated.
- If fewer than three Reference Dealers selected by the Calculation
Agent are quoting as mentioned immediately above, the CMT Rate in
effect immediately prior to such CMT Interest Determination Date shall
not change and shall remain the CMT Rate in effect on such CMT
Interest Determination Date.
"Designated CMT Telerate Page" means the display on the Telerate (or any
successor service) on the page specified on the face hereof (or any other page
as may replace such page on that service for the purpose of displaying Treasury
Constant Maturities as reported in H.15(519)). If no such page is specified,
the Designated CMT Telerate Page shall be 7052, for the most recent week.
"Designated CMT Maturity Index" means the original period to maturity of
the U.S. Treasury securities (either 1, 2, 3, 5, 7, 10, 20 or 30 years)
specified on the face hereof with respect to which the CMT Rate shall be
calculated.
EVENTS OF DEFAULT
If an Event of Default, as defined in the Indenture, with respect to
Securities of this series shall occur and be continuing, the principal of the
Securities of this series may be declared due and payable in the manner and with
the effect provided in the Indenture.
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MODIFICATION AND WAIVERS; OBLIGATION OF THE COMPANY ABSOLUTE
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with the
consent of the Holders of a majority in principal amount of the Securities at
the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting the Holders of specified percentages in principal amount
of the Securities of each series at the time Outstanding, on behalf of the
Holders of all Securities of such series, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued upon the registration
of transfer hereof or in exchange herefor or in lieu hereof, whether or not
notation of such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this
Security at the times, place and rate, and in the coin or currency, herein
prescribed, except that in the event the Company deposits money or Government
Obligations as provided in Section 401 or 403 of the Indenture, such payments
shall be made only from proceeds of such money or Government Obligations.
DEFEASANCE AND COVENANT DEFEASANCE
The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness on this Security and (b) certain restrictive covenants and
certain Events of Default, upon compliance by the Company with certain
conditions set forth therein, which provisions apply to this Security.
REDEMPTION
If so provided on the face hereof, the Company may at its option redeem
this Security in whole or from time to time in part in increments of $1,000
(provided that any remaining principal amount of this Security shall not be less
than the minimum authorized denomination hereof) on or after the date designated
as the Initial Redemption Date on the face hereof at 100% of the unpaid
principal amount hereof or the portion thereof redeemed multiplied by a
percentage (the "Redemption Percentage"), together with accrued interest, if
any, to the Redemption Date. The Redemption Percentage shall initially be equal
to the Initial Redemption Percentage specified on the face hereof and shall
decline at each anniversary of the Initial Redemption Date by the amount of the
Annual Redemption Percentage Reduction specified on the face hereof, until the
Redemption Percentage is equal to 100%. The Company may exercise such option by
causing the Trustee to mail a notice of such redemption at least 30 but not more
than 60 days prior to the applicable Redemption Date to each Holder of the
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Securities of this series to be redeemed. In the event of redemption of this
Security in part only, the Company shall issue a new Security or Securities for
the unredeemed portion hereof in the name of the Holder hereof upon the
cancellation hereof. If less than all of the Securities of this series with
like tenor and terms are to be redeemed, the Securities to be redeemed shall be
selected by the Trustee by such method as the Trustee shall deem fair and
appropriate.
SINKING FUND
Unless otherwise specified on the face hereof, this Security shall not be
entitled to any sinking fund.
REPAYMENT
If so provided on the face hereof, this Security will be repayable prior to
the Stated Maturity Date at the option of the Holder, in whole or in part and in
increments of $1,000 (provided that any remaining principal amount of this
Security surrendered for partial repayment shall not be less than the minimum
authorized denomination hereof), on or after the date designated as an Optional
Repayment Date on the face hereof at 100% of the principal amount to be repaid,
plus accrued interest, if any, to the Repayment Date. In order for this
Security to be repaid, the Company must receive at the applicable address of the
Paying Agent set forth below or at such other place or places of which the
Company shall from time to time notify the Holder of the within Security, at
least 30 but not more than 45 days prior to an Optional Repayment Date, either
(i) this Security, with the form below entitled "Option to Elect Repayment" duly
completed, or (ii) a telegram, telex, facsimile transmission, or letter from a
member of a national securities exchange or the National Association of
Securities Dealers, Inc. or a commercial bank or a trust company in the United
States of America setting forth (a) the name, address and telephone number of
the Holder of this Security, (b) the principal amount of this Security and the
amount of this Security to be repaid, (c) a statement that the option to elect
repayment is being exercised thereby, and (d) a guarantee stating that the
Company will receive this Security, with the form below entitled "Option to
Elect Repayment" duly completed, not later than five Business Days after the
date of such telegram, telex, facsimile transmission or letter (and this
Security and form duly completed are received by the Company by such fifth
Business Day). Any such election shall be irrevocable. The address to which
such deliveries to The First National Bank of Chicago are to be made is One
First National Plaza, Suite 0126, Chicago, Illinois 60670 (or, at such other
place as the Company shall notify the Holders of the Securities of this series).
All questions as to the validity, eligibility (including time of receipt) and
acceptance of any Security for repayment will be determined by the Company,
whose determination will be final and binding. Upon any partial repayment, this
Security shall be cancelled and a new Security or Securities for the remaining
principal amount hereof shall be issued in the name of the Holder of this
Security.
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AUTHORIZED DENOMINATIONS
Unless otherwise provided on the face hereof, this Security is issuable
only in registered form without coupons in denominations of $1,000 or any amount
in excess thereof which is an integral multiple of $1,000.
REGISTRATION OF TRANSFER
Upon due presentment for registration of transfer of this Security at the
office or agency of the Company maintained in New York City or Chicago,
Illinois, a new Security or Securities of this series in authorized
denominations for an equal aggregate principal amount will be issued to the
transferee in exchange herefor, as provided in the Indenture and subject to the
limitations provided therein and to the limitations described below, without
charge except for any tax or other governmental charge imposed in connection
therewith.
If this Security is a Global Security (as specified above), this Security
is exchangeable for definitive Securities in registered form only if (x) the
Depositary notifies the Company that it is unwilling or unable to continue as
Depositary for this Security or if at any time the Depositary ceases to be a
clearing agency registered under the Securities Exchange Act of 1934, as
amended, and the Company does not appoint a successor Depositary within 90 days
after receiving such notice or after becoming aware that the Depositary has
ceased to be so registered as a clearing agency, (y) the Company in its sole
discretion determines that this Security shall be exchangeable for definitive
Securities in registered form and notifies the Trustee thereof or (z) an Event
of Default with respect to the Securities represented hereby has occurred and is
continuing. If this Security is exchangeable pursuant to the preceding
sentence, it shall be exchangeable for definitive Securities in registered form,
bearing interest at the same rate, having the same date of issuance, redemption
provisions, Stated Maturity Date and other terms and of authorized denominations
aggregating a like amount.
If this Security is a Global Security (as specified above), this Security
may not be transferred except as a whole by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary or by the Depositary or any such nominee to a
successor of the Depositary or a nominee of such successor. Except as provided
above, owners of beneficial interests in this Global Security will not be
entitled to receive physical delivery of Securities in definitive form and will
not be considered the Holders hereof for any purpose under the Indenture.
Prior to due presentment of this Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name this Security is registered as the owner hereof for all
purposes, whether or not this Security be overdue, and neither the Company, the
Trustee nor any such agent shall be affected by notice to the contrary.
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NO PERSONAL RECOURSE
No recourse shall be had for the payment of the principal of or the
interest on this Security, or for any claim based hereon, or otherwise in
respect hereof, or based on or in respect of the Indenture or any indenture
supplemental thereto, against any incorporator, shareholder, officer or
director, as such, past, present or future, of the Company or any successor
corporation, whether by virtue of any constitution, statute or rule of law, or
by the enforcement of any assessment or penalty or otherwise, all such liability
being, by the acceptance hereof and as part of the consideration for the
issuance hereof, expressly waived and released.
DEFINED TERMS
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
GOVERNING LAW
This Security shall be governed by and construed in accordance with the law
of the State of Minnesota, without regard to principles of conflicts of laws.
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--------------------
OPTION TO ELECT REPAYMENT
TO BE COMPLETED ONLY IF THIS SECURITY IS REPAYABLE
AT THE OPTION OF THE HOLDER AND THE HOLDER
ELECTS TO EXERCISE SUCH RIGHT
--------------------
The undersigned hereby irrevocably requests and instructs the Company to
repay the within Security (or the portion thereof specified below), pursuant to
its terms, on the Optional Repayment Date first occurring after the date of
receipt by the Company of the within Security as specified below (the "Repayment
Date"), at a Repayment Price equal to 100% of the principal amount thereof,
together with interest to the Repayment Date, to the undersigned,
_____________________________, at ______________________________________ (please
print or typewrite name and address of the undersigned).
For this option to elect repayment to be effective, the Company must
receive, at the applicable address of the Paying Agent set forth in the within
Security or at such other place or places of which the Company shall from time
to time notify the Holder of the within Security, at least 30 but not more than
45 days prior to an Optional Repayment Date, either (i) this Security, with this
"Option to Elect Repayment" form duly completed, or (ii) a telegram, telex,
facsimile transmission, or letter from a member of a national securities
exchange or the National Association of Securities Dealers, Inc. or a commercial
bank or a trust company in the United States of America setting forth (a) the
name, address and telephone number of the Holder of the Security, (b) the
principal amount of the Security and the amount of the Security to be repaid,
(c) a statement that the option to elect repayment is being irrevocably
exercised thereby, and (d) a guarantee stating that the Security to be repaid
with the form entitled "Option to Elect Repayment" on the addendum to the
Security duly completed will be received by the Company not later than five
Business Days after the date of such telegram, telex, facsimile transmission or
letter (and such Security and form duly completed are received by the Company by
such fifth Business Day).
If less than the entire principal amount of the within Security is to be
repaid, specify the portion thereof (which shall be an integral multiple of
$1,000) which the Holder elects to have repaid: $__________.
22
If less than the entire principal amount of the within Security is to be
repaid, specify the denomination or denominations (which shall be $1,000 or an
integral multiple thereof) of the Security or Securities to be issued to the
Holder for the portion of the within Securities not being repaid (in the absence
of any specification, one such Security will be issued for the portion not being
repaid): $______________.
Date:
----------------- ----------------------------------------
Notice: The signature to this Option to
Elect Repayment must correspond with the
name as written upon page 2 of the
within Security in every particular
without alteration or enlargement or any
change whatsoever.
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ABBREVIATIONS
The following abbreviations, when used in the inscription on the face of
this instrument, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right
of survivorship and not
as tenants in common
UNIF GIFT MIN ACT -- _____________________ Custodian _________________________
(Cust) (Minor)
Under Uniform Gifts to Minors Act
- ------------------------------
(State)
Additional abbreviations may also be used though not in the above list.
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
Please Insert Social Security or
Other Identifying Number of Assignee
- ------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(PLEASE PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE)
the within Security of DAYTON HUDSON CORPORATION and all rights thereunder and
does hereby irrevocably constitute and appoint __________________ attorney to
transfer the said Security on the books of the within-named Company, with full
power of substitution in the premises.
24
Dated:
-------------------------
------------------------------
Signature Guaranteed:
------------------------------
NOTICE: The signature to this assignment must correspond with the name as
written upon the face of the within Security in every particular, without
alteration or enlargement or any change whatsoever.
25