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________________________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934
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BROWN-FORMAN CORPORATION
(Exact name of registrant as specified in its charter)
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<S> <C> <C>
Delaware 1-123 61-0143150
(State of incorporation) (Commission File Number) (I.R.S. Employer Identification No.)
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850 DIXIE HIGHWAY
LOUISVILLE, KENTUCKY 40210-1091
(502) 585-1100
(Address and telephone number of registrant's principal executive offices)
Item 5. Other Events
On March 23, 1994, Brown-Forman Corporation (the "Company") entered into a
U.S. Distribution Agreement with Morgan Stanley & Co. Incorporated, Goldman,
Sachs & Co., Lehman Brothers Inc., and J.P. Morgan Securities Inc., as agents
(collectively, the "Agents"), with respect to the issue and sale from time to
time by the Company of up to $250,000,000 aggregate initial public offering
price of its medium-term notes due more than nine months from the date of
issuance. A copy of such Agreement is set forth in the pages attached hereto.
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934,
BROWN-FORMAN CORPORATION HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF
BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF LOUISVILLE AND
COMMONWEALTH OF KENTUCKY, ON THIS 23RD DAY OF MARCH, 1994.
BROWN-FORMAN CORPORATION
By: Owsley Brown II
President and Chief Executive Officer
By: /s/ Christopher A. Sailer
_______________________________________
Christopher A. Sailer
Attorney-in-fact for
Owsley Brown II
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EXHIBIT (1)
BROWN-FORMAN CORPORATION
$250,000,000
Medium-Term Notes
Due more than 9 Months from Date of Issue
U.S. DISTRIBUTION AGREEMENT
March 23, 1994
Morgan Stanley & Co. Incorporated
1251 Avenue of the Americas
New York, New York 10020
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Lehman Brothers Inc.
3 World Financial Center
New York, New York 10285
J.P. Morgan Securities Inc.
60 Wall Street
New York, New York 10260
Dear Sirs:
Brown-Forman Corporation, a Delaware corporation (the "Company"), confirms
its agreement with each of you with respect to the issue and sale from time to
time by the Company of up to $250,000,000 (or the equivalent thereof in one or
more foreign currencies or composite currencies) aggregate initial public
offering price of its medium-term notes due more than 9 months from date of
issue (the "Notes"). The Notes will be issued under an Indenture dated as of
March 1, 1994 (the "Indenture") between the Company and First National Bank of
Chicago, as Trustee (the "Trustee"), and will have the maturities, interest
rates, redemption provisions, if any, and other terms as set forth in
supplements to the Basic Prospectus referred to below.
The Company hereby appoints Morgan Stanley & Co. Incorporated ("Morgan
Stanley") Goldman, Sachs & Co., Lehman Brothers Inc. and J.P. Morgan Securities
Inc. (individually, an "Agent" and collectively, the "Agents") as its exclusive
agents, subject to Section 12, for the purpose of soliciting
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and receiving offers to purchase Notes from the Company by others and, on the
basis of the representations and warranties herein contained, but subject to the
terms and conditions herein set forth, each Agent agrees to use reasonable
efforts to solicit and receive offers to purchase Notes upon terms acceptable to
the Company at such times and in such amounts as the Company shall from time to
time specify. In addition, any Agent may also purchase Notes as principal
pursuant to the terms of a terms agreement relating to such sale (a "Terms
Agreement") in accordance with the provisions of Section 2(b) hereof.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement, including a prospectus, relating to the
Notes. Such registration statement, including the exhibits thereto, as amended
at the Commencement Date (as hereinafter defined), is hereinafter referred to as
the "Registration Statement." The Company proposes to file with the Commission
from time to time, pursuant to Rule 424 under the Securities Act of 1933, as
amended (the "Securities Act"), supplements to the prospectus included in the
Registration Statement that will describe certain terms of the Notes. The
prospectus in the form in which it appears in the Registration Statement is
hereinafter referred to as the "Basic Prospectus." The term "Prospectus" means
the Basic Prospectus together with the prospectus supplement or supplements
(each a "Prospectus Supplement") specifically relating to Notes, as filed with,
or transmitted for filing to, the Commission pursuant to Rule 424. As used
herein, the terms "Basic Prospectus" and "Prospectus" shall include in each case
the documents, if any, incorporated by reference therein. The terms
"supplement," "amendment" and "amend" as used herein shall include all documents
deemed to be incorporated by reference in the Prospectus that are filed
subsequent to the date of the Basic Prospectus by the Company with the
Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act").
1. Representations and Warranties. The Company represents and warrants
to and agrees with each Agent as of the Commencement Date, as of each date on
which an Agent solicits offers to purchase Notes, as of each date on which the
Company accepts an offer to purchase Notes (including any purchase by an Agent
pursuant to a Terms Agreement), as of each date the Company issues and delivers
Notes and as of each date the Registration Statement or the Basic Prospectus is
amended or supplemented, as follows (it being understood that such
representations, warranties and agreements shall be deemed to relate to the
Registration Statement, the Basic Prospectus and the Prospectus, each as amended
or supplemented to each such date):
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(a) The Registration Statement has become effective, no stop order
suspending the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or threatened by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant to the
Exchange Act and incorporated by reference in the Prospectus complied or will
comply when so filed in all material respects with the Exchange Act and the
applicable rules and regulations of the Commission thereunder, (ii) no part of
the Registration Statement, when such part became effective, contained, and no
such part, if amended or supplemented will contain, any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, (iii) the Registration
Statement and the Prospectus comply and, if amended or supplemented, will comply
in all material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder and (iv) the Prospectus does not
contain and, as amended or supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, except that (1) the representations and
warranties set forth in this Section 1(b) do not apply (A) to statements or
omissions in the Registration Statement or the Prospectus based upon information
relating to an Agent furnished to the Company in writing by such Agent expressly
for use therein or (B) to that part of the Registration Statement that
constitutes the Statement of Eligibility (Form T-1) under the Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act"), of the Trustee and (2) the
representations and warranties set forth in clauses (iii) and (iv) above, when
made as of the Commencement Date or as of any date on which an Agent solicits
offers to purchase Notes or on which the Company accepts an offer to purchase
Notes, shall be deemed not to cover information concerning an offering of
particular Notes to the extent such information will be set forth in a
supplement to the Basic Prospectus.
(c) The Company has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the State of Delaware, has the
corporate power and authority to own its property and to conduct its business as
described in the Prospectus, and is duly qualified to transact business and is
in good standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification, except to the
extent that the failure to be so qualified or be in good standing would not have
a
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material adverse effect on the Company and its subsidiaries, taken as a whole.
(d) Each of Lenox, Incorporated and Jack Daniel Distillery, Lem Motlow
Prop., Inc. (the "Significant Subsidiaries") has been duly incorporated, is
validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, has the corporate power and authority to own
its property and to conduct its business as described in the Prospectus and is
duly qualified to transact business and is in good standing in each jurisdiction
in which the conduct of its business or its ownership or leasing of property
requires such qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse effect on the
Company and its subsidiaries, taken as a whole.
(e) Each of this Agreement and any applicable Written Terms Agreement (as
hereinafter defined) has been duly authorized, executed, and delivered by the
Company.
(f) The Indenture has been duly qualified under the Trust Indenture Act
and has been duly authorized, executed, and delivered by the Company and is a
valid and binding agreement of the Company, enforceable in accordance with its
terms except as (i) the enforceability thereof may be limited by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and (ii) rights
of acceleration and the availability of equitable remedies may be limited by
equitable principles of general applicability.
(g) The Notes have been duly authorized and, when executed and
authenticated in accordance with the provisions of the Indenture and delivered
to and paid for by the purchasers thereof, will be entitled to the benefits of
the Indenture and will be valid and binding obligations of the Company,
enforceable in accordance with their respective terms except as (i) their
enforceability may be limited by bankruptcy, insolvency, or similar laws
affecting creditors' rights generally and (ii) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles of
general applicability.
(h) The execution and delivery by the Company of, and the performance by
the Company of its obligations under, this Agreement, the Notes, the Indenture,
and any applicable Written Terms Agreement will not contravene any provision of
applicable law or the certificate of incorporation or by-laws of the Company or
any agreement or other instrument binding upon the Company or any of its
subsidiaries that is material to the Company and its subsidiaries, taken as a
whole, or any judgment, order or decree of any governmental
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body, agency or court having jurisdiction over the Company or any subsidiary,
and no consent, approval, authorization or order of or qualification with any
governmental body or agency is required for the performance by the Company of
its obligations under this Agreement, the Notes, the Indenture and any
applicable Terms Agreement, except such 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.
(i) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the condition,
financial or otherwise, or in the earnings, business or operations of the
Company and its subsidiaries, taken as a whole, from that set forth in the
Prospectus.
(j) There are no legal or governmental proceedings pending or, to the
Company's knowledge, threatened to which the Company or any of its subsidiaries
is a party or to which any of the properties of the Company or any of its
subsidiaries is subject that are required to be described in the Registration
Statement or the Prospectus and are not so described or any statutes,
regulations, contracts, or other documents that are required to be described in
the Registration Statement or the Prospectus or to be filed or incorporated by
reference as exhibits to the Registration Statement that are not described,
filed, or incorporated as required.
(k) The Company is not an "investment company" or an entity "controlled" by
an "investment company" as such terms are defined in the Investment Company Act
of 1940, as amended.
Notwithstanding the foregoing, the representations and warranties set forth
in Section 1(b)(iii) and (iv), (g) (except as to due authorization of the Notes)
and (h), when made as of the Commencement Date, or as of any date on which an
Agent solicits offers to purchase Notes, with respect to any Notes the payments
of principal or interest on which will be determined by reference to one or more
currency exchange rates, commodity prices, equity indices or other factors,
shall be deemed not to address the application of the Commodity Exchange Act, as
amended, or the rules, regulations or interpretations of the Commodity Futures
Trading Commission.
2. Solicitations as Agent; Purchases as Principal.
(a) Solicitations as Agent. In connection with an Agent's actions as
agent hereunder, such Agent agrees to use reasonable efforts to solicit offers
to purchase Notes
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upon the terms and conditions set forth in the Prospectus as then amended or
supplemented.
The Company reserves the right, in its sole discretion, to instruct the
Agents to suspend at any time, for any period of time or permanently, the
solicitation of offers to purchase Notes. Upon receipt of at least one business
day's prior notice from the Company, the Agents will forthwith suspend
solicitations of offers to purchase Notes from the Company until such time as
the Company has advised the Agents that such solicitation may be resumed. While
such solicitation is suspended, the Company shall not be required to deliver any
certificates, opinions or letters in accordance with Sections 5(a), 5(b) and
5(c); provided, however, that if the Registration Statement or Prospectus is
amended or supplemented during the period of suspension (other than by an
amendment or supplement providing solely for a change in the interest rates,
redemption provisions, amortization schedules or maturities offered on the Notes
or for a change the Agents deem to be immaterial), no Agent shall be required to
resume soliciting offers to purchase Notes until the Company has delivered such
certificates, opinions and letters as such Agent may request.
The Company agrees to pay to each Agent, as consideration for the sale of
each Note resulting from a solicitation made or an offer to purchase received by
such Agent, a commission in the form of a discount from the purchase price of
such Note equal to the percentage set forth below of the purchase price of such
Note:
Term Commission Rate
---- ---------------
From 9 months to less than 1 year .125%
From 1 year to less than 18 months .150%
From 18 months to less than 2 years .200%
From 2 years to less than 3 years .250%
From 3 years to less than 4 years .350%
From 4 years to less than 5 years .450%
From 5 years to less than 6 years .500%
From 6 years to less than 7 years .550%
From 7 years to less than 10 years .600%
From 10 years to less than 15 years .625%
From 15 years to less than 20 years .700%
From 20 years to less than 30 years .750%
Commissions with respect to Notes maturing in thirty years or greater will be
negotiated between the Company and the appropriate Agent.
Each Agent shall communicate to the Company, orally or in writing, each
offer to purchase Notes received by such Agent as agent that in its judgment
should be
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considered by the Company. The Company shall have the sole right to accept
offers to purchase Notes and may reject any offer in whole or in part. Each
Agent shall have the right to reject any offer to purchase Notes that it
considers to be unacceptable, and any such rejection shall not be deemed a
breach of its agreements contained herein. The procedural details relating to
the issue and delivery of Notes sold by the Agents as agents and the payment
therefor shall be as set forth in the Administrative Procedures (as hereinafter
defined).
(b) Purchases as Principal. Each sale of Notes to an Agent as principal
shall be made in accordance with the terms of this Agreement. In connection
with each such sale, the Company will enter into a Terms Agreement that will
provide for the sale of such Notes to and the purchase thereof by such Agent.
Each Terms Agreement will take the form of either (i) a written agreement
between such Agent and the Company substantially in the form of Exhibit A hereto
(a "Written Terms Agreement"), or (ii) an oral agreement between such Agent and
the Company confirmed in writing by such Agent to the Company.
An Agent's commitment to purchase Notes pursuant to a Terms Agreement shall
be deemed to have been made on the basis of the representations and warranties
of the Company herein contained and shall be subject to the terms and conditions
herein set forth. Each Terms Agreement shall specify the principal amount of
Notes to be purchased by such Agent pursuant thereto, the maturity date of such
Notes, the price to be paid to the Company for such Notes, the interest rate and
interest rate formula, if any, applicable to such Notes and any other terms of
such Notes. Each such Terms Agreement may also specify any requirements for
officers' certificates, opinions of counsel and letters from the independent
public accountants of the Company pursuant to Section 4 hereof. A Terms
Agreement may also specify certain provisions relating to the reoffering of such
Notes by such Agent.
Each Terms Agreement shall specify the time and place of delivery of and
payment for such Notes. Unless otherwise specified in a Terms Agreement, the
procedural details relating to the issue and delivery of Notes purchased by an
Agent as principal and the payment therefor shall be as set forth in the
Administrative Procedures. Each date of delivery of and payment for Notes to be
purchased by an Agent pursuant to a Terms Agreement is referred to herein as a
"Settlement Date."
Unless otherwise specified in a Terms Agreement, if you are purchasing
Notes as principal you may resell such Notes to other dealers. Any such sales
may be at a
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discount, which shall not exceed the amount set forth in the Prospectus
Supplement relating to such Notes.
(c) Administrative Procedures. The Agents and the Company agree to
perform the respective duties and obligations specifically provided to be
performed in the Medium-Term Notes Administrative Procedures (attached hereto as
Exhibit B) (the "Administrative Procedures"), as amended from time to time. The
Administrative Procedures may be amended only by written agreement of the
Company and the Agents.
(d) Delivery. The documents required to be delivered by Section 4 of this
Agreement as a condition precedent to each Agent's obligation to begin
soliciting offers to purchase Notes as an agent of the Company shall be
delivered at the office of Davis Polk & Wardwell, counsel for the Agents, not
later than 5 p.m., New York time, on the date hereof, or at such other time
and/or place as the Agents and the Company may agree upon in writing, but in no
event later than the day prior to the earlier of (i) the date on which the
Agents begin soliciting offers to purchase Notes and (ii) the first date on
which the Company accepts any offer by an Agent to purchase Notes pursuant to a
Terms Agreement. The date of delivery of such documents is referred to herein
as the "Commencement Date."
(e) Obligations Several. The Company acknowledges that the obligations of
the Agents under this Agreement are several and not joint.
3. Agreements. The Company agrees with each Agent that:
(a) Prior to the termination of the offering of the Notes pursuant to this
Agreement or any Terms Agreement, the Company will not file any Prospectus
Supplement relating to the Notes or any amendment to the Registration Statement
unless the Company has previously furnished to the Agents copies thereof for
their review and will not file any such proposed supplement or amendment to
which the Agents reasonably object; provided, however, that (i) the foregoing
requirement shall not apply to any of the Company's periodic filings with the
Commission required to be filed pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act, copies of which filings the Company will cause to be delivered
to the Agents promptly after being transmitted for filing with the Commission
and (ii) any Prospectus Supplement that merely sets forth the terms or a
description of particular Notes shall only be reviewed and approved by the Agent
or Agents offering such Notes. Subject to the foregoing sentence, the Company
will promptly cause each Prospectus Supplement to be filed with or transmitted
for
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filing to the Commission in accordance with Rule 424(b) under the Securities
Act. The Company will promptly advise the Agents (i) of the filing of any
amendment or supplement to the Basic Prospectus (except that notice of the
filing of an amendment or supplement to the Basic Prospectus that merely sets
forth the terms or a description of particular Notes shall only be given to the
Agent or Agents offering such Notes), (ii) of the filing and effectiveness of
any amendment to the Registration Statement, (iii) of any request by the
Commission for any amendment to the Registration Statement or any amendment or
supplement to the Basic Prospectus or for any additional information, (iv) of
the issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement or the institution or threatening of any proceeding
for that purpose and (v) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Notes for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose. The Company will use its best efforts to prevent the issuance of any
such stop order or notice of suspension of qualification and, if issued, to
obtain as soon as possible the withdrawal thereof. If the Basic Prospectus is
amended or supplemented as a result of the filing under the Exchange Act of any
document incorporated by reference in the Prospectus, no Agent shall be
obligated to solicit offers to purchase Notes so long as it is not reasonably
satisfied with such document.
(b) If, at any time when a prospectus relating to the Notes is required to
be delivered under the Securities Act, any event occurs or condition exists as a
result of which the Prospectus, as then amended or supplemented, would include
an untrue statement of a material fact, or omit to state any material fact
necessary to make the statements therein, in the light of the circumstances when
the Prospectus, as then amended or supplemented, is delivered to a purchaser,
not misleading, or if, in the opinion of the Agents or in the opinion of the
Company, it is necessary at any time to amend or supplement the Prospectus, as
then amended or supplemented, to comply with applicable law, the Company will
immediately notify the Agents by telephone (with confirmation in writing) to
suspend solicitation of offers to purchase Notes and, if so notified by the
Company, the Agents shall forthwith suspend such solicitation and cease using
the Prospectus, as then amended or supplemented. If the Company shall decide to
amend or supplement the Registration Statement or Prospectus, as then amended or
supplemented, it shall so advise the Agents promptly by telephone (with
confirmation in writing) and, at its expense, shall prepare and cause to be
filed promptly with the Commission an amendment or supplement to the
Registration Statement or Prospectus, as then amended or
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supplemented, satisfactory in all respects to the Agents, that will correct such
statement or omission or effect such compliance and will supply such amended or
supplemented Prospectus to the Agents in such quantities as they may reasonably
request. If any documents, certificates, opinions and letters furnished to the
Agents pursuant to paragraph (f) below and Sections 5(a), 5(b) and 5(c) in
connection with the preparation and filing of such amendment or supplement are
satisfactory in all respects to the Agents, upon the filing with the Commission
of such amendment or supplement to the Prospectus or upon the effectiveness of
an amendment to the Registration Statement, the Agents will resume the
solicitation of offers to purchase Notes hereunder. Notwithstanding any other
provision of this Section 3(b), until the distribution of any Notes an Agent may
own as principal has been completed, if any event described above in this
paragraph (b) occurs, the Company will, at its own expense, forthwith prepare
and cause to be filed promptly with the Commission an amendment or supplement to
the Registration Statement or Prospectus, as then amended or supplemented,
satisfactory in all respects to such Agent, will supply such amended or
supplemented Prospectus to such Agent in such quantities as it may reasonably
request and shall furnish to such Agent pursuant to paragraph (f) below and
Sections 5(a), 5(b) and 5(c) such documents, certificates, opinions and letters
as it may request in connection with the preparation and filing of such
amendment or supplement.
(c) The Company will make generally available to its security holders and
to the Agents as soon as practicable earning statements that satisfy the
provisions of Section 11(a) of the Securities Act and the rules and regulations
of the Commission thereunder covering twelve month periods beginning, in each
case, not later than the first day of the Company's fiscal quarter next
following the "effective date" (as defined in Rule 158 under the Securities Act)
of the Registration Statement with respect to each sale of Notes. If such
fiscal quarter is the last fiscal quarter of the Company's fiscal year, such
earning statement shall be made available not later than 90 days after the close
of the period covered thereby and in all other cases shall be made available not
later than 45 days after the close of the period covered thereby. For the
purposes of this paragraph, an earning statement shall be deemed to be "made
available" if the Company is required to file reports with the Securities and
Exchange Commission and has filed such report or reports.
(d) The Company will furnish to each Agent, without charge, a signed copy
of the Registration Statement, including exhibits and all amendments thereto,
and as many copies of the Prospectus, any documents incorporated by
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reference therein and any supplements and amendments thereto as such Agent may
reasonably request.
(e) The Company will endeavor to qualify the Notes for offer and sale
under the securities or Blue Sky laws of such jurisdictions as the Agents shall
reasonably request and to maintain such qualifications for as long as the Agents
shall reasonably request.
(f) The Company shall furnish to the Agents such relevant documents and
certificates of officers of the Company relating to the business, operations and
affairs of the Company, the Registration Statement, the Basic Prospectus, any
amendments or supplements thereto, the Indenture, the Notes, this Agreement, the
Administrative Procedures, any Terms Agreement and the performance by the
Company of its obligations hereunder or thereunder as the Agents may from time
to time reasonably request.
(g) The Company will, whether or not any sale of Notes is consummated, pay
all expenses incident to the performance of its obligations under this Agreement
and any Terms Agreement, including: (i) the preparation and filing of the
Registration Statement and the Prospectus and all amendments and supplements
thereto, (ii) the preparation, issuance and delivery of the Notes, (iii) the
fees and disbursements of the Company's counsel and accountants and of the
Trustee and its counsel, (iv) the qualification of the Notes under securities or
Blue Sky laws in accordance with the provisions of Section 3(e), including
filing fees and the fees and disbursements of counsel for the Agents in
connection therewith and in connection with the preparation of any Blue Sky or
Legal Investment Memoranda, (v) the printing and delivery to the Agents in
quantities as hereinabove stated of copies of the Registration Statement and all
amendments thereto and of the Prospectus and any amendments or supplements
thereto, (vi) the printing and delivery to the Agents of copies of any Blue Sky
or Legal Investment Memoranda, (vii) any fees charged by rating agencies for the
rating of the Notes and (viii) the fees and disbursements of counsel for the
Agents incurred in connection with the offering and sale of the Notes, including
any opinions to be rendered by such counsel hereunder, and (ix) any out-of-
pocket expenses incurred by the Agents; provided that any advertising expenses
incurred by the Agents shall have been approved by the Company.
(h) During the period beginning the date of any Terms Agreement and
continuing to and including the Settlement Date with respect to such Terms
Agreement, the Company will not, without such Agent's prior consent, offer,
sell, contract to sell or otherwise dispose of any debt securities of the
Company substantially similar to such
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Notes (other than (i) the Notes that are to be sold pursuant to such Terms
Agreement, (ii) Notes previously agreed to be sold by the Company and (iii)
commercial paper issued in the ordinary course of business), except as may
otherwise be provided in such Terms Agreement.
4. Conditions of the Obligations of the Agents. Each Agent's obligation
to solicit offers to purchase Notes as agent of the Company, each Agent's
obligation to purchase Notes pursuant to any Terms Agreement and the obligation
of any other purchaser to purchase Notes will be subject to the accuracy of the
representations and warranties on the part of the Company herein, to the
accuracy of the statements of the Company's officers made in each certificate
furnished pursuant to the provisions hereof and to the performance and
observance by the Company of all covenants and agreements herein contained on
its part to be performed and observed (in the case of an Agent's obligation to
solicit offers to purchase Notes, at the time of such solicitation, and, in the
case of an Agent's or any other purchaser's obligation to purchase Notes, at the
time the Company accepts the offer to purchase such Notes and at the time of
issuance and delivery) and (in each case) to the following additional conditions
precedent when and as specified:
(a) Prior to such solicitation or purchase, as the case may be:
(i) there shall not have occurred any change, or any development
involving a prospective change, in the condition, financial or otherwise,
or in the earnings, business or operations of the Company and its
subsidiaries, taken as a whole, from that set forth in the Prospectus, as
amended or supplemented at the time of such solicitation or at the time
such offer to purchase was made, that, in the judgment of the relevant
Agent, is material and adverse and that makes it, in the judgment of such
Agent, impracticable to market the Notes on the terms and in the manner
contemplated by the Prospectus, as so amended or supplemented;
(ii) there shall not have occurred any (A) suspension or material
limitation of trading generally on or by, as the case may be, any of the
New York Stock Exchange, the American Stock Exchange, the National
Association of Securities Dealers, Inc., the Chicago Board Options
Exchange, the Chicago Mercantile Exchange or the Chicago Board of Trade,
(B) suspension of trading of any securities of the Company on any exchange
or in any over-the-counter market, (C) declaration of a general moratorium
on commercial
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banking activities in New York by either Federal or New York State
authorities or (D) any outbreak or escalation of hostilities or any change
in the U.S. financial markets or any calamity or crisis that, in the
judgment of the relevant Agent, is material and adverse and, in the case of
any of the events described in clauses (ii)(A) through (D), such event,
singly or together with any other such event, makes it, in the judgment of
such Agent, impracticable to market the Notes on the terms and in the
manner contemplated by the Prospectus, as amended or supplemented at the
time of such solicitation or at the time such offer to purchase was made;
and
(iii) there shall not have occurred any downgrading, nor shall any
notice have been given of any intended or potential downgrading or of any
review for a possible change that does not indicate the direction of the
possible change, in the rating accorded any of the Company's securities by
any "nationally recognized statistical rating organization," as such term
is defined for purposes of Rule 436(g)(2) under the Securities Act;
except, in each case described in paragraph (i), (ii) or (iii) above, as
disclosed to the relevant Agent in writing by the Company prior to such
solicitation or, in the case of a purchase of Notes, as disclosed to the
relevant Agent before the offer to purchase such Notes was made or unless in
each case described in (ii) above, the relevant event shall have occurred and
been known to the relevant Agent before such solicitation or, in the case of a
purchase of Notes, before the offer to purchase such Notes was made.
(b) On the Commencement Date and, if called for by any Terms
Agreement, on the corresponding Settlement Date, the relevant Agents shall have
received:
(i) The opinion, dated as of such date, of independent counsel for
the Company to the effect that:
(A) the Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the State of
Delaware, has the corporate power and authority to own its property
and to conduct its business as described in the Prospectus, as then
amended or supplemented, and is duly qualified to transact business
and is in good standing in each jurisdiction in which the conduct of
its business or its ownership or leasing of property requires such
qualification, except to the extent that the
13
<PAGE>
failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as
a whole;
(B) each Significant Subsidiary of the Company has been duly
incorporated, is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its property and to conduct its
business as described in the Prospectus, as then amended or
supplemented, and is duly qualified to transact business and is in
good standing in each jurisdiction in which the conduct of its
business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so
qualified or be in good standing would not have a material adverse
effect on the Company and its subsidiaries, taken as a whole;
(C) each of this Agreement and any applicable Written Terms
Agreement has been duly authorized, executed and delivered by the
Company;
(D) the Indenture has been duly qualified under the Trust
Indenture Act and has been duly authorized, executed and delivered by
the Company and is a valid and binding agreement of the Company,
enforceable in accordance with its terms except as (i) the
enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and (ii) rights of
acceleration and the availability of equitable remedies may be limited
by equitable principles of general applicability;
(E) the Notes have been duly authorized and, if executed and
authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the purchasers thereof on the date of
such opinion, would be entitled to the benefits of the Indenture and
would be valid and binding obligations of the Company, enforceable in
accordance with their respective terms except as (i) the
enforceability thereof may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and (ii) rights of
acceleration and the availability of equitable remedies may be limited
by equitable principles of general applicability;
(F) the execution and delivery by the Company of, and the
performance by the Company of
14
<PAGE>
its obligations under, this Agreement, the Notes, the Indenture and
any applicable Written Terms Agreement will not contravene any
provision of applicable law or the certificate of incorporation or by-
laws of the Company or, to the best of such counsel's knowledge, any
agreement or other instrument binding upon the Company or any of its
subsidiaries that is material to the Company and its subsidiaries,
taken as a whole, or, to the best of such counsel's knowledge, any
judgment, order or decree of any governmental body, agency or court
having jurisdiction over the Company or any subsidiary, and no
consent, approval, authorization or order of or qualification with any
governmental body or agency is required for the performance by the
Company of its obligations under this Agreement, the Notes, the
Indenture and any applicable Terms Agreement, except such 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;
(G) the statements (1) in the Prospectus, as then amended or
supplemented, under the captions "Description of the Notes" and "Plan
of Distribution", (2) in the Registration Statement under Item 15, (3)
in "Item 3 - Legal Proceedings" of the Company's most recent annual
report on Form 10-K incorporated by reference in the Prospectus and
(4) in "Item 1 - Legal Proceedings" of Part II of the Company's
quarterly reports on Form 10-Q, if any, filed since such annual
report, in each case insofar as such statements constitute summaries
of the legal matters, documents or proceedings referred to therein,
fairly present the information called for with respect to such legal
matters, documents and proceedings and fairly summarize the matters
referred to therein;
(H) after due inquiry, such counsel does not know of any legal
or governmental proceedings pending or threatened to which the Company
or any of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is subject that
are required to be described in the Registration Statement or the
Prospectus, as then amended or supplemented, and are not so described
or of any statutes, regulations, contracts or other documents that are
required to be described in the Registration Statement or the
Prospectus, as then amended or supplemented, or to be filed or
incorporated by reference as exhibits to such Registration
15
<PAGE>
Statement that are not described, filed or incorporated as required;
(I) the Company is not an "investment company" or an entity
"controlled" by an "investment company," as such terms are defined in
the Investment Company Act of 1940, as amended;
(J) such counsel (1) is of the opinion that each document, if
any, filed pursuant to the Exchange Act and incorporated by reference
in the Prospectus, as then amended or supplemented (except for
financial statements and schedules included therein as to which such
counsel need not express any opinion) complied when so filed as to
form in all material respects with the Exchange Act and the applicable
rules and regulations of the Commission thereunder, (2) believes that
(except for financial statements and schedules as to which such
counsel need not express any belief and except for that part of the
Registration Statement that constitutes the Form T-1 heretofore
referred to) each part of the Registration Statement, as then amended,
if applicable, when such part became effective did not, and as of the
date such opinion is delivered, does not contain any untrue statement
of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, (3) is of the opinion that the Registration Statement and
Prospectus, as then amended or supplemented, if applicable (except for
financial statements and schedules included therein as to which such
counsel need not express any opinion) comply as to form in all
material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder and (4) believes that (except
for financial statements and schedules as to which such counsel need
not express any belief) the Prospectus, as then amended or
supplemented, if applicable, as of the date such opinion is delivered
does not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; provided that in the case of an opinion delivered on
the Commencement Date or pursuant to Section 5(b), the opinion and
belief set forth in clauses (3) and (4) above shall be deemed not to
cover information concerning an offering of particular Notes to the
16
<PAGE>
extent such information will be set forth in a supplement to the Basic
Prospectus.
(ii) The opinion, dated as of such date, of Davis Polk & Wardwell,
counsel for the Agents, covering the matters in subparagraphs (C), (D), (E)
and (G) (with respect to statements in the Prospectus, as then amended or
supplemented, under the captions "Description of the Notes" and "Plan of
Distribution"), and clauses (2), (3) and (4) of subparagraph (J) in
paragraph (b)(i) above. Such counsel is of the opinion ascribed to it in
the Prospectus, as then amended or supplemented, under the caption "United
States Taxation."
Notwithstanding the foregoing, the opinions described in subparagraphs
(E) (except as to due authorization of the Notes), (F), (G)(1) and (J)(3) and
(4) of paragraph (b)(i) above, when contained in an opinion delivered on the
Commencement Date or pursuant to Section 5(b), shall be deemed not to address
the application of the Commodity Exchange Act, as amended, or the rules,
regulations or interpretations of the Commodity Futures Trading Commission to
Notes the payments of principal or interest on which will be determined by
reference to one or more currency exchange rates, commodity prices, equity
indices or other factors.
With respect to subparagraph (J) of paragraph (b)(i) above, counsel to
the Company may state that their opinion and belief are based upon their
participation in the preparation of the Registration Statement and Prospectus
and any amendments or supplements thereto and documents incorporated therein by
reference and review and discussion of the contents thereof, but are without
independent check or verification, except as specified. With respect to clauses
(2), (3) and (4) of subparagraph (J) of paragraph (b)(i) above, Davis Polk &
Wardwell may state that their opinion and belief are based upon their
participation in the preparation of the Registration Statement and Prospectus
and any amendments or supplements thereto (but not including documents
incorporated therein by reference) and review and discussion of the contents
thereof (including documents incorporated therein by reference), but are without
independent check or verification, except as specified.
The opinion of independent counsel for the Company described in
paragraph (b)(i) above shall be rendered to you at the request of the Company
and shall so state therein.
(c) On the Commencement Date and, if called for by any Terms
Agreement, on the corresponding Settlement Date, the relevant Agents shall have
received a certificate,
17
<PAGE>
dated the Commencement Date or such Settlement Date, as the case may be, and
signed by an executive officer of the Company, to the effect set forth in
subparagraph (a)(iii) above and to the effect that the representations and
warranties of the Company contained in this Agreement are true and correct as of
such date and that the Company has complied with all of the agreements and
satisfied all of the conditions on its part to be performed or satisfied on or
before such date.
The officer signing and delivering such certificate may rely upon the
best of his knowledge as to proceedings threatened.
(d) On the Commencement Date and, if called for by any Terms
Agreement, on the corresponding Settlement Date, Coopers & Lybrand, independent
public accountants, shall have furnished to the relevant Agents a letter or
letters, dated the Commencement Date or such Settlement Date, as the case may
be, in form and substance satisfactory to such Agents containing statements and
information of the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain financial
information contained in or incorporated by reference into the Prospectus, as
then amended or supplemented (each such letter referred to below as a "Comfort
Letter").
(e) On the Commencement Date, the Company shall have furnished to the
relevant Agents such appropriate further information, certificates and documents
as they may reasonably request.
5. Additional Agreements of the Company. (a) Each time the
Registration Statement or Prospectus is amended or supplemented (other than by
an amendment or supplement providing solely for a change in the interest rates,
redemption provisions, amortization schedules or maturities offered on the Notes
or for a change the Agents deem to be immaterial), the Company will deliver or
cause to be delivered forthwith to each Agent a certificate signed by an
executive officer of the Company, dated the date of such amendment or
supplement, as the case may be, in form reasonably satisfactory to the Agents,
of the same tenor as the certificate referred to in Section 4(c) relating to the
Registration Statement or the Prospectus as amended or supplemented to the time
of delivery of such certificate. For the purposes of this Section, the
appointment of an agent other than an Agent by the Company for a single
transaction or a series of transactions with respect to a particular issue of
Notes shall be deemed immaterial.
18
<PAGE>
(b) Each time the Company furnishes a certificate pursuant to Section
5(a), the Company will furnish or cause to be furnished forthwith to each Agent
a written opinion of independent counsel for the Company. Any such opinion shall
be dated the date of such amendment or supplement, as the case may be, shall be
in a form satisfactory to the Agents and shall be of the same tenor as the
opinion referred to in Section 4(b)(i), but modified to relate to the
Registration Statement and the Prospectus as amended and supplemented to the
time of delivery of such opinion. In lieu of such opinion, counsel last
furnishing such an opinion to an Agent may furnish to each Agent a letter to the
effect that such Agent may rely on such last opinion to the same extent as
though it were dated the date of such letter (except that statements in such
last opinion will be deemed to relate to the Registration Statement and the
Prospectus as amended or supplemented to the time of delivery of such letter.)
(c) Promptly following the Company's annual filing with the
Commission of its Annual Report on Form 10-K, the Company shall cause its
independent public accountants forthwith to furnish to each Agent a Comfort
Letter, addressed to each of the Agents. In addition, if, during any fiscal
quarter of the Company, the Company issues $40,000,000 (or the equivalent
thereof in one or more foreign currencies or composite currencies) or more
aggregate principal amount of Notes, the Company shall cause its independent
public accountants forthwith to furnish to each Agent a Comfort Letter,
addressed to each of the Agents and dated the date of the issuance of Notes
which issuance causes the aggregate principal amount issued in such fiscal
quarter to equal or exceed $40,000,000; provided, however, that the Company is
not required to have its accountants furnish a Comfort Letter during the period
between the date of the annual Comfort Letter referred to in the preceding
sentence and the date the Company files with the Commission its Quarterly Report
on Form 10-Q for its first fiscal quarter; provided further, that the Agents may
jointly waive the Company's obligations with respect to any fiscal quarter under
the foregoing provisions; and provided further, that any such waiver will not
affect the Company's obligations in the foregoing provision with respect to any
future issuance.
6. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless each Agent and each person, if any, who controls any
Agent within the meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act from and against any and all losses, claims, damages and
liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such
action or claim) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration
19
<PAGE>
Statement or any amendment thereof or the Prospectus (as amended or supplemented
if the Company shall have furnished any amendments or supplements thereto), or
caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages or liabilities are
caused by any such untrue statement or omission or alleged untrue statement or
omission based upon information relating to such Agent furnished to the Company
in writing by such Agent expressly for use therein; provided that the foregoing
indemnity agreement with respect to any preliminary prospectus shall not inure
to the benefit of any Agent from whom the person asserting any such losses,
claims, damages or liabilities purchased Notes, or any person controlling such
Agent, if a copy of the Prospectus (as then amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) was not sent
or given by or on behalf of such Agent to such person, if required by law so to
have been delivered, at or prior to the written confirmation of the sale of the
Notes to such person, and if the Prospectus (as so amended or supplemented)
would have cured the defect giving rise to such losses, claims, damages or
liabilities.
(b) Each Agent agrees, severally and not jointly, to indemnify and
hold harmless the Company, its directors, its officers who sign the Registration
Statement and each person, if any, who controls the Company within the meaning
of either Section 15 of the Securities Act or Section 20 of the Exchange Act to
the same extent as the foregoing indemnity from the Company to such Agent, but
only with reference to information relating to such Agent furnished to the
Company in writing by such Agent expressly for use in the Registration Statement
or the Prospectus or any amendments or supplements thereto.
(c) In case any proceeding (including any governmental investigation)
shall be instituted involving any person in respect of which indemnity may be
sought pursuant to either paragraph (a) or (b) above, such person (the
"indemnified party") shall promptly notify the person against whom such
indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii)
20
<PAGE>
the named parties to any such proceeding (including any impleaded parties)
include both the indemnifying party and the indemnified party and representation
of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all such indemnified
parties and that all such fees and expenses shall be reimbursed as they are
incurred. Such firm shall be designated in writing by Morgan Stanley or, if
Morgan Stanley is not an indemnified party and is not reasonably likely to
become an indemnified party, by the Agents that are indemnified parties, in the
case of parties indemnified pursuant to paragraph (a) above, and by the Company,
in the case of parties indemnified pursuant to paragraph (b) above. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement of any pending
or threatened proceeding in respect of which any indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
(d) To the extent the indemnification provided for in paragraph (a)
or (b) of this Section 6 is unavailable to an indemnified party or insufficient
in respect of any losses, claims, damages or liabilities referred to therein in
connection with any offering of Notes, then each indemnifying party under such
paragraph, in lieu of indemnifying such indemnified party thereunder, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company on the one
hand and each Agent on the other hand from the offering of such Notes or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company on
the one hand and each Agent on the other hand in connection with the statements
or omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits
received by the
21
<PAGE>
Company on the one hand and each Agent on the other hand in connection with the
offering of such Notes shall be deemed to be in the same respective proportions
as the total net proceeds from the offering of such Notes (before deducting
expenses) received by the Company bear to the total discounts and commissions
received by each Agent in respect thereof. The relative fault of the Company on
the one hand and each Agent on the other hand shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or by such Agent and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. Each Agent's obligation to contribute
pursuant to this Section 6 shall be several in the proportion that the principal
amount of the Notes the sale of which by or through such Agent gave rise to such
losses, claims, damages or liabilities bears to the aggregate principal amount
of the Notes the sale of which by or through any Agent gave rise to such losses,
claims, damages or liabilities, and not joint.
(e) The Company and the Agents agree that it would not be just or
equitable if contribution pursuant to this Section 6 were determined by pro rata
allocation (even if the Agents were treated as one entity for such purpose) or
by any other method of allocation that does not take account of the equitable
considerations referred to in paragraph (d) above. The amount paid or payable
by an indemnified party as a result of the losses, claims, damages and
liabilities referred to in paragraph (d) above shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 6, no Agent shall be required to contribute any amount in excess of the
amount by which the total price at which the Notes referred to in paragraph (d)
above that were offered and sold to the public through such Agent exceeds the
amount of any damages that such Agent has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
remedies provided for in this Section 6 are not exclusive and shall not limit
any rights or remedies which may otherwise be available to any indemnified party
at law or in equity.
7. Position of the Agents. In acting under this Agreement and in
connection with the sale of any Notes by the Company (other than Notes sold to
an Agent pursuant to a
22
<PAGE>
Terms Agreement), each Agent is acting solely as agent of the Company and does
not assume any obligation towards or relationship of agency or trust with any
purchaser of Notes. An Agent shall make reasonable efforts to assist the
Company in obtaining performance by each purchaser whose offer to purchase Notes
has been solicited by such Agent and accepted by the Company, but such Agent
shall not have any liability to the Company in the event any such purchase is
not consummated for any reason. If the Company shall default in its obligations
to deliver Notes to a purchaser whose offer it has accepted, the Company shall
hold the relevant Agent harmless against any loss, claim, damage or liability
arising from or as a result of such default and shall, in particular, pay to
such Agent the commission it would have received had such sale been consummated.
8. Termination. This Agreement may be terminated at any time by the
Company or, as to any Agent, by the Company or such Agent upon the giving of
written notice of such termination to the other parties hereto, but without
prejudice to any rights, obligations or liabilities of any party hereto accrued
or incurred prior to such termination. The termination of this Agreement shall
not require termination of any Terms Agreement, and the termination of any such
Terms Agreement shall not require termination of this Agreement. If this
Agreement is terminated, the provisions of the third paragraph of Section 2(a),
Section 2(e), the last sentence of Section 3(b) and Sections 3(c), 3(h), 6, 7,
9, 11 and 14 shall survive; provided that if at the time of termination an offer
to purchase Notes has been accepted by the Company but the time of delivery to
the purchaser or its agent of such Notes has not occurred, the provisions of
Sections 2(b), 2(c), 3(a), 3(e), 3(f), 3(g), 3(i), 4 and 5 shall also survive
until such delivery has been made.
9. Representations and Indemnities to Survive. The respective
indemnity and contribution agreements, representations, warranties and other
statements of the Company, its officers and the Agents set forth in or made
pursuant to this Agreement or any Terms Agreement will remain in full force and
effect regardless of (i) any termination of this Agreement or any such Terms
Agreement, (ii) any investigation made by or on behalf of any Agent or any
person controlling any Agent or by or on behalf of the Company, its officers or
directors or any person controlling the Company and (iii) acceptance of and
payment for any of the Notes.
10. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to Morgan Stanley, will be mailed,
delivered or telefaxed and confirmed to Morgan Stanley at 1221 Avenue of the
Americas, 4th Floor, New York, New York 10020, Attention: Manager -Continuously
Offered Products (telefax number:
23
<PAGE>
212-764-7490), with a copy to 1251 Avenue of the Americas, New York, New York
10020, Attention: Peter Cooper -Investment Banking Information Center (telefax
number: 212-703-6476); Goldman, Sachs & Co. at 85 Broad Street, New York, New
York 10004; Lehman Brothers Inc. at 3 World Financial Center, New York, New York
10285; J.P. Morgan Securities Inc. at 60 Wall Street, 3rd Floor, New York, New
York 10260; or, if sent to the Company, will be mailed, delivered or telefaxed
and confirmed to the Company at 850 Dixie Highway, Louisville, Kentucky 40210,
Attention: Treasurer.
11. Successors. This Agreement and any Terms Agreement will inure to
the benefit of and be binding upon the parties hereto and their respective
successors and the officers, directors and controlling persons referred to in
Section 6 and the purchasers of Notes (to the extent expressly provided in
Section 4), and no other person will have any right or obligation hereunder.
12. Amendments. This Agreement may be amended or supplemented if,
but only if, such amendment or supplement is in writing and is signed by the
Company and each Agent; provided that the Company may from time to time, on
seven days prior written notice to the Agents but without the consent of any
Agent, amend this Agreement to add as a party hereto one or more additional
firms registered under the Exchange Act, whereupon each such firm shall become
an Agent hereunder on the same terms and conditions as the other Agents that are
parties hereto. The Agents shall sign any amendment or supplement giving effect
to the addition of any such firm as an Agent under this Agreement.
Notwithstanding the foregoing, but subject to written notice to the Agents, no
amendment or supplement to this Agreement will be required for an agent other
than an Agent appointed by the Company for a single transaction or a series of
transactions with respect to a particular issue of Notes; provided that such
agent agrees in writing to be bound by the terms and conditions hereof.
13. Counterparts. 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.
14. Applicable Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
24
<PAGE>
15. Headings. The headings of the sections of this Agreement have
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement between the
Company and you.
Very truly yours,
BROWN-FORMAN CORPORATION
By__________________________
Title:
The foregoing Agreement
is hereby confirmed
and accepted as of the
date first above written.
MORGAN STANLEY & CO. INCORPORATED
By_______________________________
Title:
GOLDMAN SACHS, & CO.
_______________________
LEHMAN BROTHERS INC.
By:_____________________
Title:
J.P. MORGAN SECURITIES INC.
By:_____________________
Title:
25
<PAGE>
EXHIBIT A
BROWN-FORMAN CORPORATION
MEDIUM-TERM NOTES
TERMS AGREEMENT
_________________, 19__
Brown-Forman Corporation
850 Dixie Highway
Louisville, Kentucky 40210
Attention:
Re: Distribution Agreement dated March 23, 1994
(the "Distribution Agreement")
-------------------------------------------
We agree to purchase your Medium-Term Notes having the following terms:
[We agree to purchase, severally and not jointly, the principal amount
of Notes set forth below opposite our names:
<TABLE>
<CAPTION>
Principal Amount
Name of Notes
---- ----------------
<S> <C>
[Insert syndicate list]/1/
Total. . . . . . . $
================
</TABLE>
- ------------
/1/Delete if the transaction will not be syndicated.
A-1
<PAGE>
The Notes shall have the following terms:
<TABLE>
<CAPTION>
All Notes: Fixed Rate Notes: Floating Rate Notes:
- -------- ----------------- --------------------
<S> <C> <C>
Principal amount: Interest Rate: Base rate:
Purchase price: Applicability Index maturity:
of modified
Price to public: payment upon Spread:
acceleration:
Settlement date Spread multiplier:
and time: If yes, state
issue price: Alternate rate
event spread:
Place of
delivery: Amortization
schedule: Initial interest
Specified rate:
currency:
Initial interest
Maturity date: reset date:
Initial accrual Interest reset
period OID: dates:
Total amount Interest reset
of OID: period:
Original yield Maximum interest
to maturity: rate:
Optional repayment Minimum interest
date(s): rate:
Optional redemption Interest payment
date(s): period:
Initial redemption Interest payment
date: dates:
Initial redemption Calculation agent:
percentage:
Annual redemption
percentage
decrease:
Other terms:
</TABLE>
A-2
<PAGE>
The provisions of Sections 1, 2(b) and 2(c) and 3 through 6, 9, 10, 11
and 14 of the Distribution Agreement and the related definitions are
incorporated by reference herein and shall be deemed to have the same force and
effect as if set forth in full herein.
[If on the Settlement Date any one or more of the Agents shall fail or
refuse to purchase Notes that it has or they have agreed to purchase on such
date, and the aggregate amount of Notes which such defaulting Agent or Agents
agreed but failed or refused to purchase is not more than one-tenth of the
aggregate amount of the Notes to be purchased on such date, the other Agents
shall be obligated severally in the proportions that the amount of Notes set
forth opposite their respective names above bears to the aggregate amount of
Notes set forth opposite the names of all such non-defaulting Agents, or in such
other proportions as Morgan Stanley & Co. Incorporated may specify, to purchase
the Notes which such defaulting Agent or Agents agreed but failed or refused to
purchase on such date; provided that in no event shall the amount of Notes that
any Agent has agreed to purchase pursuant to this Agreement be increased
pursuant to this paragraph by an amount in excess of one-ninth of such amount of
Notes without the written consent of such Agent. If on the Settlement Date any
Agent or Agents shall fail or refuse to purchase Notes and the aggregate amount
of Notes with respect to which such default occurs is more than one-tenth of the
aggregate amount of Notes to be purchased on such date, and arrangements
satisfactory to Morgan Stanley & Co. Incorporated and the Company for the
purchase of such Notes are not made within 36 hours after such default, this
Agreement shall terminate without liability on the part of any non-defaulting
Agent or the Company. In any such case either Morgan Stanley & Co. Incorporated
or the Company shall have the right to postpone the Settlement Date but in no
event for longer than seven days, in order that the required changes, if any, in
the Registration Statement and in the Prospectus or in any other documents or
arrangements may be effected. Any action taken under this paragraph shall not
relieve any defaulting Agent from liability in respect of any default of such
Agent under this Agreement.]/2/
This Agreement is subject to termination on the terms incorporated by
reference herein. If this Agreement is so terminated, the provisions of
Sections 3(h), 6, 9, 11 and 14 of the Distribution Agreement shall survive for
the purposes of this Agreement.
- -------------
/2/Delete if the transaction will not be syndicated.
A-3
<PAGE>
The following information, opinions, certificates, letters and
documents referred to in Section 4 of the Distribution Agreement will be
required: ________________
[NAME OF RELEVANT AGENT(S)]
By_________________________
Title:
Accepted:
BROWN-FORMAN CORPORATION
By________________________
Title:
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<PAGE>
EXHIBIT B
BROWN-FORMAN CORPORATION
MEDIUM-TERM NOTES
ADMINISTRATIVE PROCEDURES
Explained below are the administrative procedures and specific terms of the
offering of Medium-Term Notes (the "Notes"), on a continuous basis by Brown-
Forman Corporation (the "Company") pursuant to the Distribution Agreement, dated
as of March 23, 1994 (the "Distribution Agreement") among the Company and Morgan
Stanley & Co. Incorporated, Goldman, Sachs & Co., Lehman Brothers Inc. and J.P.
Morgan Securities Inc. (the "Agents"). The Notes will be issued under an
Indenture dated as of March 1, 1994 (the "Indenture") between the Company and
First National Bank of Chicago, as trustee (the "Trustee"). In the Distribution
Agreement, the Agents have agreed to use reasonable efforts to solicit purchases
of the Notes, and the administrative procedures explained below will govern the
issuance and settlement of any Notes sold through an Agent, as agent of the
Company. An Agent, as principal, may also purchase Notes for its own account,
and if requested by such Agent, the Company and such Agent will enter into a
terms agreement (a "Terms Agreement"), as contemplated by the Distribution
Agreement. The administrative procedures explained below will govern the
issuance and settlement of any Notes purchased by an Agent, as principal, unless
otherwise specified in the applicable Terms Agreement.
The Trustee will be the Registrar, Calculation Agent, Authenticating Agent and
Paying Agent for the Notes and will perform the duties specified herein. Each
Note will be represented by either a Global Security (as defined below)
delivered to the Trustee, as agent for The Depository Trust Company ("DTC"), and
recorded in the book-entry system maintained by DTC (a "Book-Entry Note") or a
certificate delivered to the holder thereof or a person designated by such
holder (a "Certificated Note"). Except as set forth in the Indenture, an owner
of a Book-Entry Note will not be entitled to receive a Certificated Note.
Book-Entry Notes, which may be payable only in U.S. dollars, will be issued in
accordance with the administrative procedures set forth in Part I hereof as they
may subsequently be amended as the result of changes in DTC'S operating
procedures. Certificated Notes will be issued in accordance with the
administrative procedures set
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forth in Part II hereof. Unless otherwise defined herein, terms defined in the
Indenture, the Notes or any prospectus supplement relating to the Notes shall be
used herein as therein defined.
The Company will advise the Agents in writing of the employees of the Company
with whom the Agents are to communicate regarding offers to purchase Notes and
the related settlement details.
PART I: ADMINISTRATIVE PROCEDURES FOR BOOK-ENTRY NOTES
In connection with the qualification of the Book-Entry Notes for eligibility
in the book-entry system maintained by DTC, the Trustee will perform the
custodial, document control and administrative functions described below, in
accordance with its respective obligations under a Letter of Representation from
the Company and the Trustee to DTC, dated as of March 23, 1994, and a Medium-
Term Note Certificate Agreement between the Trustee and DTC, dated as of May 26,
1989 (the "MTN Certificate Agreement"), and the Trustee's obligations as a
participant in DTC, including DTC's Same-Day Funds Settlement System ("SDFS").
Issuance: On any date of settlement (as defined under
"Settlement" below) for one or more Book-Entry Notes,
the Company will issue a single global security in
fully registered form without coupons (a "Global
Security") representing up to U.S. $150,000,000
principal amount of all such Notes that have the same
Original Issue Date, Maturity Date and other terms.
Each Global Security will be dated and issued as of
the date of its authentication by the Trustee. Each
Global Security will bear an "Interest Accrual Date,"
which will be (i) with respect to an original Global
Security (or any portion thereof), its original
issuance date and (ii) with respect to any Global
Security (or any portion thereof) issued subsequently
upon exchange of a Global Security, or in lieu of a
destroyed, lost or stolen Global Security, the most
recent Interest Payment Date to which interest has
been paid or duly provided for on
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<PAGE>
the predecessor Global Security (or if no such payment
or provision has been made, the original issuance date
of the predecessor Global Security), regardless of the
date of authentication of such subsequently issued
Global Security. Book-Entry Notes may be payable only
in U.S. dollars. No Global Security will represent any
Certificated Note.
Denominations: Book-Entry Notes will be issued in principal amounts
of U.S. $1,000 or any amount in excess thereof that is
an integral multiple of U.S. $1,000. Global Securities
will be denominated in principal amounts not in excess
of U.S. $150,000,000. If one or more Book-Entry Notes
having an aggregate principal amount in excess of
$150,000,000 would, but for the preceding sentence, be
represented by a single Global Security, then one
Global Security will be issued to represent each U.S.
$150,000,000 principal amount of such Book-Entry Note
or Notes and an additional Global Security will be
issued to represent any remaining principal amount of
such Book-Entry Note or Notes. In such a case, each of
the Global Securities representing such Book-Entry
Note or Notes shall be assigned the same CUSIP number.
Preparation of Pricing
Supplement: If any offer to purchase a Book-Entry Note is accepted
by or on behalf of the Company, the Company will
prepare a pricing supplement (a "Pricing Supplement")
reflecting the terms of such Note. The Company (i)
will arrange to file 10 copies of such Pricing
Supplement with the Commission in accordance with the
applicable paragraph of Rule 424(b) under the Act and
(ii) will, as soon as possible and in any event not
later than the date on which such Pricing Supplement
is filed with the Commission, deliver the number of
copies of such Pricing Supplement to
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the relevant Agent as such Agent shall request.
In each instance that a Pricing Supplement is
prepared, the relevant Agent will affix the Pricing
Supplement to Prospectuses prior to their use.
Outdated Pricing Supplements, and the Prospectuses to
which they are attached (other than those retained for
files), will be destroyed.
Settlement: The receipt by the Company of immediately available
funds in payment for a Book-Entry Note and the
authentication and issuance of the Global Security
representing such Note shall constitute "settlement"
with respect to such Note. All offers accepted by the
Company will be settled on the fifth Business Day next
succeeding the date of acceptance pursuant to the
timetable for settlement set forth below, unless the
Company and the purchaser agree to settlement on
another day, which shall be no earlier than the next
Business Day.
Settlement Procedures: Settlement Procedures with regard to each Book-Entry
Note sold by the Company to or through an Agent
(unless otherwise specified pursuant to a Terms
Agreement) shall be as follows:
A. The relevant Agent will advise the Company by
telephone that such Note is a Book-Entry Note and
of the following settlement information:
1. Principal amount.
2. Maturity Date.
3. In the case of a Fixed Book-Entry Note, the
Interest Rate, whether such Note will pay
interest annually or semiannually and whether
such Note is an
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<PAGE>
Amortizing Note, and, if so, the amortization
schedule, or, in the case of a Floating Rate
Book-Entry Note, the Initial Interest Rate
(if known at such time), Interest Payment
Date(s), Interest Payment Period, Calculation
Agent, Base Rate, Index Maturity, Interest
Reset Period, Initial Interest Reset Date,
Interest Reset Dates, Spread or Spread
Multiplier (if any), Minimum Interest Rate
(if any), Maximum Interest Rate (if any) and
the Alternate Rate Event Spread (if any).
4. Redemption or repayment provisions (if any).
5. Settlement date and time (Original Issue
Date).
6. Interest Accrual Date.
7. Price.
8. Agent's commission (if any) determined as
provided in the Distribution Agreement.
9. Whether the Note is an Original Issue
Discount Note (an "OID Note"), and if it is
an OID Note, the total amount of OID, the
yield to maturity, the initial accrual period
OID and the applicability of Modified Payment
upon Acceleration (and, if so, the Issue
Price).
10. Whether the Note is a Renewable Note, and if
it is a Renewable Note, the Initial Maturity
Date and the Final Maturity Date.
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<PAGE>
11. Whether the Company has the option to extend
the Original Maturity Date of the Note, and,
if so, the Final Maturity Date of such Note.
12. Whether the Company has the option to reset
the Interest Rate, the Spread or the Spread
Multiplier of the Note.
13. Any other applicable terms.
B. The Company will advise the Trustee by telephone
or electronic transmission (confirmed in writing
at any time on the same date) of the information
set forth in Settlement Procedure "A" above. The
Trustee will then assign a CUSIP number to the
Global Security representing such Note and will
notify the Company and the relevant Agent of such
CUSIP number by telephone as soon as practicable.
C. The Trustee will enter a pending deposit message
through DTC's Participant Terminal System,
providing the following settlement information to
DTC, the relevant Agent and Standard & Poor's
Corporation:
1. The information set forth in Settlement
Procedure "A".
2. The Initial Interest Payment Date for such
Note, the number of days by which such date
succeeds the related DTC Record Date (which in
the case of Floating Rate Notes which reset
daily or weekly, shall be the date five
calendar days immediately preceding the
applicable Interest Payment Date and, in the
case of all
B-6
<PAGE>
other Notes, shall be the Record Date as
defined in the Note) and, if known, the
amount of interest payable on such Initial
Interest Payment Date.
3. The CUSIP number of the Global Security
representing such Note.
4. Whether such Global Security will represent
any other Book-Entry Note (to the extent
known at such time).
5. Whether such Note is an Amortizing Note (by
an appropriate notation in the comments field
of DTC's Participant Terminal System).
D. The Trustee will complete and authenticate the
Global Security representing such Note.
E. DTC will credit such Note to the Trustee's
participant account at DTC.
F. The Trustee will enter an SDFS deliver order
through DTC's Participant Terminal System
instructing DTC to (i) debit such Note to the
Trustee's participant account and credit such Note
to the relevant Agent's participant account and
(ii) debit such Agent's settlement account and
credit the Trustee's settlement account for an
amount equal to the price of such Note less such
Agent's commission (if any). The entry of such a
deliver order shall constitute a representation
and warranty by the Trustee to DTC that (a) the
Global Security representing such Book-Entry Note
has been issued and authenticated and (b) the
Trustee is holding such Global
B-7
<PAGE>
Security pursuant to the MTN Certificate
Agreement.
G. Unless the relevant Agent is the end purchaser of
such Note, such Agent will enter an SDFS deliver
order through DTC's Participant Terminal System
instructing DTC (i) to debit such Note to such
Agent's participant account and credit such Note
to the participant accounts of the Participants
with respect to such Note and (ii) to debit the
settlement accounts of such Participants and
credit the settlement account of such Agent for an
amount equal to the price of such Note.
H. Transfers of funds in accordance with SDFS deliver
orders described in Settlement Procedures "F" and
"G" will be settled in accordance with SDFS
operating procedures in effect on the settlement
date.
I. The Trustee will credit to account number
57-13080 of the Company maintained at The First
National Bank of Chicago in immediately
available funds the amount transferred to the
Trustee in accordance with Settlement Procedure
"F".
J. Unless the relevant Agent is the end purchaser of
such Note, such Agent will confirm the purchase of
such Note to the purchaser either by transmitting
to the Participants with respect to such Note a
confirmation order or orders through DTC's
institutional delivery system or by mailing a
written confirmation to such purchaser.
K. Monthly, the Trustee will send to the Company a
statement setting forth the principal amount of
Notes outstanding as
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<PAGE>
of that date under the Indenture and setting forth
a brief description of any sales of which the
Company has advised the Trustee that have not yet
been settled.
Settlement Procedures
Timetable: For sales by the Company of Book-Entry Notes to or
through an Agent (unless otherwise specified pursuant
to a Terms Agreement) for settlement on the first
Business Day after the sale date, Settlement
Procedures "A" through "J" set forth above shall be
completed as soon as possible but not later than the
respective times in New York City set forth below:
Settlement
Procedure Time
---------- ----
A 11:00 A.M. on sale date
B 12:00 Noon on sale date
C 2:00 P.M. on sale date
D 9:00 A.M. on settlement date
E 10:00 A.M. on settlement date
F-G 2:00 P.M. on settlement date
H 4:45 P.M. on settlement date
I-J 5:00 P.M. on settlement date
If a sale is to be settled more than one Business Day
after the sale date, Settlement Procedures "A", "B"
and "C" shall be completed as soon as practicable but
no later than 11:00 A.M., 12:00 Noon and 2:00 P.M.,
respectively, on the first Business Day after the sale
date. If the Initial Interest Rate for a Floating Rate
Book-Entry Note has not been determined at the time
that Settlement Procedure "A" is completed, Settlement
Procedures "B" and "C" shall be completed as soon as
such rate has been determined but no later than 12:00
Noon and 2:00
B-9
<PAGE>
P.M., respectively, on the first Business Day before
the settlement date. Settlement Procedure "H" is
subject to extension in accordance with any extension
of Fedwire closing deadlines and in the other events
specified in the SDFS operating procedures in effect
on the settlement date.
If settlement of a Book-Entry Note is rescheduled or
canceled, the Trustee, after receiving notice from the
Company or the relevant Agent, will deliver to DTC,
through DTC's Participant Terminal System, a
cancellation message to such effect by no later than
2:00 P.M. on the Business Day immediately preceding
the scheduled settlement date.
Failure to Settle: If the Trustee fails to enter an SDFS deliver order
with respect to a Book-Entry Note pursuant to
Settlement Procedure "F", the Trustee may deliver to
DTC, through DTC's Participant Terminal System, as
soon as practicable a withdrawal message instructing
DTC to debit such Note to the Trustee's participant
account, provided that the Trustee's participant
account contains a principal amount of the Global
Security representing such Note that is at least equal
to the principal amount to be debited. If a withdrawal
message is processed with respect to all the Book-
Entry Notes represented by a Global Security, the
Trustee will mark such Global Security "canceled,"
make appropriate entries in the Trustee's records and
send such canceled Global Security to the Company. The
CUSIP number assigned to such Global Security shall,
in accordance with the procedures of the CUSIP Service
Bureau of Standard & Poor's Corporation, be canceled
and not immediately reassigned. If a withdrawal
message is processed with respect to one or more, but
not all, of the Book-Entry Notes represented
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<PAGE>
by a Global Security, the Trustee will exchange such
Global Security for two Global Securities, one of
which shall represent such Book-Entry Note or Notes
and shall be canceled immediately after issuance and
the other of which shall represent the remaining Book-
Entry Notes previously represented by the surrendered
Global Security and shall bear the CUSIP number of the
surrendered Global Security.
If the purchase price for any Book-Entry Note is not
timely paid to the Participants with respect to such
Note by the beneficial purchaser thereof (or a person,
including an indirect participant in DTC, acting on
behalf of such purchaser), such Participants and, in
turn, the relevant Agent may enter SDFS deliver orders
through DTC's Participant Terminal System reversing
the orders entered pursuant to Settlement Procedures
"F" and "G", respectively. Thereafter, the Trustee
will deliver the withdrawal message and take the
related actions described in the preceding paragraph.
Notwithstanding the foregoing, upon any failure to
settle with respect to a Book-Entry Note, DTC may take
any actions in accordance with its SDFS operating
procedures then in effect.
In the event of a failure to settle with respect to
one or more, but not all, of the Book-Entry Notes to
have been represented by a Global Security, the
Trustee will provide, in accordance with Settlement
Procedures "D" and "F", for the authentication and
issuance of a Global Security representing the Book-
Entry Notes to be represented by such Global Security
and will make appropriate entries in its records.
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<PAGE>
PART II: ADMINISTRATIVE PROCEDURES FOR CERTIFICATED NOTES
The Trustee will serve as Registrar in connection with the Certificated Notes.
Issuance: Each Certificated Note will be dated and issued as of
the date of its authentication by the Trustee. Each
Certificated Note will bear an Original Issue Date,
which will be (i) with respect to an original
Certificated Note (or any portion thereof), its
original issuance date (which will be the settlement
date) and (ii) with respect to any Certificated Note
(or portion thereof) issued subsequently upon transfer
or exchange of a Certificated Note or in lieu of a
destroyed, lost or stolen Certificated Note, the
original issuance date of the predecessor Certificated
Note, regardless of the date of authentication of such
subsequently issued Certificated Note.
Preparation of Pricing
Supplement: If any offer to purchase a Certificated Note is
accepted by or on behalf of the Company, the Company
will prepare a Pricing Supplement reflecting the terms
of such Note. The Company (i) will arrange to file 10
copies of such Pricing Supplement with the Commission
in accordance with the applicable paragraph of Rule
424(b) under the Act and (ii) will, as soon as
possible and in any event not later than the date on
which such Pricing Supplement is filed with the
Commission, deliver the number of copies of such
Pricing Supplement to the relevant Agent as such Agent
shall request.
In each instance that a Pricing Supplement is
prepared, the relevant Agent will affix the
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Pricing Supplement to Prospectuses prior to their use.
Outdated Pricing Supplements, and the Prospectuses to
which they are attached (other than those retained for
files), will be destroyed.
Settlement: The receipt by the Company of immediately available
funds in exchange for an authenticated Certificated
Note delivered to the relevant Agent and such Agent's
delivery of such Note against receipt of immediately
available funds shall constitute "settlement" with
respect to such Note. All offers accepted by the
Company will be settled on the fifth Business Day next
succeeding the date of acceptance pursuant to the
timetable for settlement set forth below, unless the
Company and the purchaser agree to settlement on
another date, which date shall be no earlier than the
next Business Day.
Settlement Procedures: Settlement Procedures with regard to each Certificated
Note sold by the Company to or through an Agent
(unless otherwise specified pursuant to a Terms
Agreement) shall be as follows:
A. The relevant Agent will advise the Company by
telephone that such Note is a Certificated Note
and of the following settlement information:
1. Name in which such Note is to be registered
("Registered Owner").
2. Address of the Registered Owner and address
for payment of principal and interest.
3. Taxpayer identification number of the
Registered Owner (if available).
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<PAGE>
4. Principal amount.
5. Maturity Date.
6. In the case of a Fixed Rate Certificated
Note, the Interest Rate, whether such Note
will pay interest annually or semiannually
and whether such Note is an Amortizing Note
and, if so, the amortization schedule, or, in
the case of a Floating Rate Certificated
Note, the Initial Interest Rate (if known at
such time), Interest Payment Date(s),
Interest Payment Period, Calculation Agent,
Base Rate, Index Maturity, Interest Reset
Period, Initial Interest Reset Date, Interest
Reset Dates, Spread or Spread Multiplier (if
any), Minimum Interest Rate (if any), Maximum
Interest Rate (if any) and the Alternate Rate
Event Spread (if any).
7. Redemption or repayment provisions (if any).
8. Settlement date and time (Original Issue
Date).
9. Interest Accrual Date.
10. Price.
11. Agent's commission (if any) determined as
provided in the Distribution Agreement.
12. Denominations.
13. Specified Currency.
14. Whether the Note is an OID Note, and if it is
an OID
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Note, the total amount of OID, the yield to
maturity, the initial accrual period OID and
the applicability of Modified Payment upon
Acceleration (and if so, the Issue Price).
15. Whether the Note is a Renewable Note, and if
it is a Renewable Note, the Initial Maturity
Date and the Final Maturity Date.
16. Whether the Company has the option to extend
the Original Maturity Date of the Note, and,
if so, the Final Maturity Date of such Note.
17. Whether the Company has the option to reset
the Interest Rate, the Spread or the Spread
Multiplier of the Note.
18. Any other applicable terms.
B. The Company will advise the Trustee by telephone
or electronic transmission (confirmed in writing
at any time on the same date) of the information
set forth in Settlement Procedure "A" above.
C. The Company will have delivered to the Trustee a
pre-printed four-ply packet for such Note, which
packet will contain the following documents in
forms that have been approved by the Company, the
relevant Agent and the Trustee:
1. Note with customer confirmation.
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<PAGE>
2. Stub One - For the Trustee.
3. Stub Two - For the relevant Agent.
4. Stub Three - For the Company.
D. The Trustee will complete such Note and
authenticate such Note and deliver it (with the
confirmation) and Stubs One and Two to the
relevant Agent, and such Agent will acknowledge
receipt of the Note by stamping or otherwise
marking Stub One and returning it to the Trustee.
Such delivery will be made only against such
acknowledgment of receipt and evidence that
instructions have been given by such Agent for
payment to the account of the Company at
such bank and such account number as the Company
shall have specified to such Agent and the
Trustee, in immediately available funds, of an
amount equal to the price of such Note less such
Agent's commission (if any). In the event that the
instructions given by such Agent for payment to
the account of the Company are revoked, the
Company will as promptly as possible wire transfer
to the account of such Agent an amount of
immediately available funds equal to the amount of
such payment made.
E. Unless the relevant Agent is the end purchaser of
such Note, such Agent will deliver such Note (with
confirmation) to the customer against payment in
immediately available funds. Such Agent will
obtain the acknowledgment
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<PAGE>
of receipt of such Note by retaining Stub Two.
F. The Trustee will send Stub Three to the Company by
first-class mail. Monthly, the Trustee will also
send to the Company a statement setting forth the
principal amount of the Notes outstanding as of
that date under the Indenture and setting forth a
brief description of any sales of which the
Company has advised the Trustee that have not yet
been settled.
Settlement Procedures
Timetable: For sales by the Company of Certificated Notes to or
through an Agent (unless otherwise specified pursuant
to a Terms Agreement), Settlement Procedures "A"
through "F" set forth above shall be completed on or
before the respective times in New York City set forth
below:
Settlement
Procedure Time
---------- ----
A 2:00 P.M. on day before settlement date
B 3:00 P.M. on day before settlement date
C-D 2:15 P.M. on settlement date
E 3:00 P.M. on settlement date
F 5:00 P.M. on settlement date
Failure to Settle: If a purchaser fails to accept delivery of and make
payment for any Certificated Note, the relevant Agent
will notify the Company and the Trustee by telephone
and return such Note to the Trustee. Upon receipt of
such notice, the Company will immediately wire
transfer to
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<PAGE>
the account of such Agent an amount equal to the
amount received by the Company pursuant to Paragraph D
under "Settlement Procedures" of these administrative
procedures. Such wire transfer will be made on the
settlement date, if possible, and in any event not
later than the Business Day following the settlement
date. If the failure shall have occurred for any
reason other than a default by such Agent in the
performance of its obligations hereunder and under the
Distribution Agreement, then the Company will
reimburse such Agent or the Trustee, as appropriate,
on an equitable basis for its loss of the use of the
funds during the period when th ey were credited to
the account of the Company. Immediately upon receipt
of the Certificated Note in respect of which such
failure occurred, the Trustee will mark such Note
"canceled," make appropriate entries in the Trustee's
records and send such Note to the Company.
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