<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 12, 1996
REGISTRATION NO.
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
AIR PRODUCTS AND CHEMICALS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction
of incorporation or organization)
23-1274455
(I.R.S. Employer
Identification No.)
7201 HAMILTON BOULEVARD
ALLENTOWN, PENNSYLVANIA 18195-1501
(610) 481-4911
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
JAMES H. AGGER, ESQ.
Vice President, General Counsel and Secretary
AIR PRODUCTS AND CHEMICALS, INC.
7201 HAMILTON BOULEVARD
ALLENTOWN, PENNSYLVANIA 18195-1501
(610) 481-4911
(Name and address, including zip code, and telephone number, including area
code, of agent for service)
COPY TO:
D. COLLIER KIRKHAM, ESQ.
CRAVATH, SWAINE & MOORE
Worldwide Plaza
825 Eighth Avenue
New York, New York 10019
Approximate date of commencement of proposed sale to the public:
From time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
- ------------------------
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
- ------------------------
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. /X/
------------------------
CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
Proposed
Proposed maximum
Title of each class Amount maximum aggregate Amount of
of securities to be offering price offering registration
to be registered registered(1) per unit(2) price(2) fee(2)
<S> <C> <C> <C> <C>
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Debt Securities............................. $500,000,000 100% $500,000,000 $172,415
</TABLE>
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(1) Any offering of Debt Securities denominated in any foreign currencies or
foreign currency units will be treated as the equivalent in U.S. dollars
based on the exchange rate applicable to the purchase of such Debt
Securities of the Registrant.
(2) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457 under the Securities Act of 1933.
The Registration Statement shall hereafter become effective in accordance
with the provisions of Section 8(a) of the Securities Act of 1933.
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<PAGE> 2
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SUPPLEMENT SHALL NOT CONSTITUTE AN OFFER
TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE
OF THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE
WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE
SECURITIES LAWS OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED APRIL 12, 1996
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED APRIL , 1996)
$500,000,000
AIR PRODUCTS AND CHEMICALS, INC.
MEDIUM-TERM NOTES, SERIES F
DUE FROM 9 MONTHS TO 30 YEARS FROM DATE OF ISSUE
------------------------
Air Products and Chemicals, Inc. (the "Company"), may offer from time to
time up to $500,000,000 aggregate principal amount or its equivalent in foreign
currencies or currency units of its Medium-Term Notes, Series F, Due from 9
Months to 30 Years from Date of Issue (the "Notes"). Each Note will mature on a
Business Day (as defined herein) from 9 months to 30 years from the date of
issue, as selected by the initial purchaser and agreed to by the Company. The
Notes being offered hereby may be denominated in U.S. dollars or in such foreign
currencies or currency units (the "Specified Currency") as may be designated by
the Company in a pricing supplement (the "Pricing Supplement") to this
Prospectus Supplement at the time of the offering. See "Foreign Currency and
Other Risks."
The Notes may be issued as Fixed Rate Notes, which will bear interest at a
fixed rate (which may be zero in the case of certain Notes issued at a price
representing a discount from the principal amount payable at maturity), or as
Floating Rate Notes, which will bear interest at a rate or rates determined by
reference to a Base Rate, as adjusted by the Spread or Spread Multiplier, if
any, each as set forth in the applicable Pricing Supplement, or as Currency
Indexed Notes, the principal amount of which payable at maturity or upon earlier
redemption or repayment, and/or the interest payable on each interest payment
date and at maturity, is determined by the difference in the rate of exchange
between the Specified Currency and another currency or currency unit on certain
specified dates, or as Commodity Indexed Notes, the principal amount of which
payable at maturity or upon earlier redemption or repayment, and/or the interest
payable on each interest payment date and at maturity, is determined by the
difference in the price of a specified commodity on certain specified dates. See
"Description of Notes."
Each Note will be issued in fully registered form and will be represented by
either a global certificate (a "Book-Entry Note") registered in the name of a
nominee of The Depository Trust Company ("DTC") or another depositary (DTC or
such other depositary as is specified in the applicable Pricing Supplement is
herein referred to as the "Depositary"), or a certificate issued in definitive
form (a "Certificated Note"), as set forth in the applicable Pricing Supplement.
Interests in Book-Entry Notes will be shown on, and transfers thereof will be
effected only through, records maintained by the Depositary and its
participants. See "Description of Notes -- Book-Entry System." The Notes will be
issued in denominations of $100,000 and any larger amount that is an integral
multiple of $1,000, except as otherwise specified in the applicable Pricing
Supplement, or, in the case of Notes denominated in a Specified Currency other
than U.S. dollars, in the denominations described under "Special Provisions
Relating to Multi-Currency Notes -- General."
The interest rate or interest rate formula, issue price, Specified Currency,
stated maturity and redemption and repayment provisions, if any, for each Note,
whether such Note is a Fixed Rate Note or a Floating Rate Note, whether such
Note is a Currency Indexed Note or Commodity Indexed Note and whether such Note
is a Book-Entry Note or a Certificated Note will be established by the Company
at the date of issuance of such Note and will be set forth in the applicable
Pricing Supplement to this Prospectus Supplement. Interest rates and interest
rate formulae are subject to change by the Company, but no such change will
affect the interest rate on, or interest rate formula for, any Note theretofore
issued or which the Company has agreed to sell. See "Description of Notes."
Unless otherwise indicated in the applicable Pricing Supplement, interest on
Fixed Rate Notes will be payable on each June 15 and December 15 and at
maturity. Interest on Floating Rate Notes will be payable on the dates indicated
herein and in the applicable Pricing Supplement. See "Description of
Notes -- Interest Rates."
FOR DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE CONSIDERED IN CONNECTION
WITH AN INVESTMENT IN THE NOTES OFFERED HEREBY, SEE "RISK FACTORS" ON PAGE S-2.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS SUPPLEMENT, ANY PRICING SUPPLEMENT HERETO OR THE
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
<TABLE>
<S> <C> <C> <C>
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PRICE TO AGENTS' PROCEEDS TO
PUBLIC(1) COMMISSIONS(2) COMPANY(2)(3)
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Per Note........................................ 100% .125% - .750% 99.250% - 99.875%
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$625,000 - $496,250,000 -
Total (4)....................................... $500,000,000 $3,750,000 $499,375,000
- --------------------------------------------------------------------------------------------------------------------
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</TABLE>
(1) Unless otherwise indicated in the Pricing Supplement relating thereto, each
Note will be issued at 100% of its principal amount.
(2) The Company will pay a commission to Lehman Brothers, Lehman Brothers Inc.
and Goldman, Sachs & Co. (each an Agent and collectively the "Agents"), in
the form of a discount, ranging from .125% to .750% of the principal amount
of a Note, depending upon its maturity, sold through such Agent. Any Agent,
acting as principal, may also purchase Notes at a discount for resale to one
or more investors or one or more broker-dealers (acting as principal for
purposes of resale) at varying prices related to prevailing market prices at
the time of resale, as determined by such Agent, or, if so agreed, at a
fixed public offering price. Unless otherwise specified in the applicable
Pricing Supplement, any Note sold to an Agent as principal will be purchased
by such Agent at a price equal to 100% of the principal amount thereof less
a percentage equal to the commission applicable to an agency sale of a Note
of identical maturity. The Company has agreed to indemnify each Agent
against certain liabilities, including liabilities under the Securities Act
of 1933, as amended. In the case of Notes sold directly to purchasers by the
Company, no commission will be paid.
(3) Before deducting expenses payable by the Company estimated at $375,000.
(4) Or the equivalent thereof in other currencies or currency units.
------------------------
The Notes are being offered on a continuous basis by the Company through the
Agents, each of which has agreed to use its reasonable best efforts to solicit
purchases of the Notes. The Company may sell Notes to any Agent, as principal,
for resale to one or more investors or to one or more broker-dealers (acting as
principal for purposes of resale) at varying prices related to prevailing market
prices at the time of resale, as determined by such Agent, or, if so agreed, at
a fixed public offering price. The Company reserves the right to sell Notes
directly to purchasers on its own behalf or to use additional agents to solicit
offers to purchase Notes. The Notes will not be listed on any securities
exchange, and there can be no assurance that the Notes will be sold or that
there will be a secondary market for the Notes. The Company reserves the right
to withdraw, cancel or modify the offer made hereby without notice. The Company
or the Agent that solicits any offer to purchase Notes may reject such offer in
whole or in part. See "Plan of Distribution."
------------------------
LEHMAN BROTHERS GOLDMAN, SACHS & CO.
, 1996
<PAGE> 3
This Prospectus Supplement contains brief summaries of certain documents
incorporated by reference in the Prospectus. Such summaries are qualified in
their entirety by the detailed information contained in the incorporated
documents.
------------------------
RISK FACTORS
EXCHANGE RATES
An investment in Multi-Currency Notes (as defined below under "Special
Provisions Relating to Multi-Currency Notes -- General") entails significant
risks that are not associated with a similar investment in a security
denominated in U.S. dollars. Similarly, an investment in a Currency Indexed Note
(as defined below under "Description of Notes -- Currency Indexed
Notes -- General") entails significant risks that are not associated with a
similar investment in non-Currency Indexed Notes. Such risks include, without
limitation, the possibility of significant changes in rates of exchange between
the U.S. dollar and the Specified Currency (and, in the case of Currency Indexed
Notes, the rate of exchange between the Specified Currency and the Indexed
Currency for such Currency Indexed Note) and the possibility of the imposition
or modification of foreign exchange controls by either the United States or
foreign governments. Such risks generally depend on economic, financial,
political and military events over which the Company has no control. To the
extent the rate is not fixed by sovereign governments, the exchange rate between
the U.S. dollar and foreign currencies or currency units is at any moment a
result of the supply of and demand for such currencies or currency units, and
changes in the rate result over time from the interaction of many factors, among
which are rates of inflation, interest rate levels, balances of payments and the
extent of governmental surpluses or deficits in the countries of the relevant
currencies. These factors are in turn sensitive to the monetary, fiscal and
trade policies pursued by such governments and those of other countries
important to international trade and finance. In recent years, rates of exchange
between the U.S. dollar and certain foreign currencies have been highly volatile
and such volatility may be expected in the future. Fluctuations in any
particular exchange rate that have occurred in the past are not necessarily
indicative, however, of fluctuations in the rate that may occur during the term
of any Multi-Currency Note or Currency Indexed Note. Depreciation of the
Specified Currency applicable to a Multi-Currency Note against the U.S. dollar
would result in a decrease in the U.S. dollar-equivalent yield of such Note, in
the U.S. dollar-equivalent value of the principal repayable at maturity of such
Note and, generally, in the U.S. dollar-equivalent market value of such Note.
Similarly, depreciation of the Specified Currency with respect to a Currency
Indexed Note against the applicable Indexed Currency would result in the
principal amount payable with respect to such Currency Indexed Note at the
Maturity Date (as defined below under "Description of Notes -- General") thereof
being less than the Face Amount (as defined below under "Special Provisions
Relating to Multi-Currency Notes -- General") of such Currency Indexed Note and
in the interest payable, if any, with respect to such Note reflecting an
interest rate less than the Base Interest Rate (as defined below under "Special
Provisions Relating to Multi-Currency Notes -- General") of such Note, which, in
turn, would decrease the effective yield of such Currency Indexed Note below its
stated interest rate and could also result in a loss to the investor. See
"Description of Notes -- Currency Indexed Notes."
Foreign exchange rates can either be fixed by sovereign governments or
float. Exchange rates of most economically developed nations are permitted to
fluctuate in value relative to the U.S. dollar. National governments, however,
rarely voluntarily allow their currencies to float freely in response to
economic forces. Sovereign governments in fact use a variety of techniques, such
as intervention by a country's central bank or imposition of regulatory controls
or taxes, to affect the exchange rate of their currencies. Exchange rates of
certain governments may from time to time be fixed by the central bank or other
agencies at a rate above or below that which might exist if the exchange rate
were allowed to float in response to changes in supply and demand. Governments
may also issue a new currency to replace an existing currency or alter the
exchange rate or relative exchange characteristics by devaluation or revaluation
of a currency. Thus, a special risk in purchasing Notes that are denominated
S-2
<PAGE> 4
in or indexed to a foreign currency or currency unit is that their U.S. dollar
equivalent yields could be affected by governmental actions which could change
or interfere with theretofore freely determined currency valuation, fluctuations
in response to other market forces and the movement of currencies across
borders. There will be no adjustment or change in the terms of the
Multi-Currency Notes or Currency Indexed Notes in the event that exchange rates
should become fixed, or in the event of any devaluation or revaluation or
imposition of exchange or other regulatory controls or taxes, or in the event of
other developments, affecting the U.S. dollar or any applicable currency or
currency unit.
PROSPECTIVE PURCHASERS SHOULD CONSULT THEIR OWN FINANCIAL AND LEGAL
ADVISORS AS TO THE RISKS ENTAILED BY AN INVESTMENT IN MULTI-CURRENCY NOTES OR
CURRENCY INDEXED NOTES. SUCH NOTES ARE NOT AN APPROPRIATE INVESTMENT FOR
INVESTORS WHO ARE UNSOPHISTICATED WITH RESPECT TO FOREIGN CURRENCY TRANSACTIONS.
Unless otherwise indicated in the applicable Pricing Supplement, Notes
denominated in a Specified Currency other than the U.S. dollar or the ECU (as
defined below under "Description of Notes -- General") will not be sold in, or
to residents of, the country of the Specified Currency in which such Notes are
denominated. The information set forth in the Prospectus, this Prospectus
Supplement and the applicable Pricing Supplement is directed to prospective
purchasers who are United States residents and the Company disclaims any
responsibility to advise prospective purchasers who are residents of countries
other than the United States with respect to any matters that may affect the
purchase, holding or receipt of payments of principal of and interest on Notes.
Such persons should consult their own legal advisors with regard to such
matters.
GOVERNING LAW AND JUDGMENTS
Notes will be governed by and construed in accordance with the laws of the
State of New York. Courts in the United States have not customarily rendered
judgments for money damages denominated in any currency other than the U.S.
dollar. The Judiciary Law of the State of New York provides, however, that a
judgment or decree in an action based upon an obligation denominated in a
currency other than U.S. dollars will be rendered in the foreign currency of the
underlying obligation and converted into U.S. dollars at the rate of exchange
prevailing on the date of the entry of the judgment or decree.
EXCHANGE CONTROLS, ETC.
Governments have imposed from time to time exchange controls and may in the
future impose or revise exchange controls at or prior to a Note's maturity. Even
if there were no exchange controls, it is possible that the Specified Currency
for any particular Multi-Currency Note would not be available at an Interest
Payment Date or at such Note's maturity. In that event, the Company will repay
in U.S. dollars on the basis of the Exchange Rate (as defined below under
"Special Provisions Relating to Multi-Currency Notes -- Payment Currency") on
the second day prior to such payment, or if such Exchange Rate is not then
available, on the basis of the most recently available Exchange Rate. See
"Special Provisions Relating to Multi-Currency Notes -- Payment Currency." No
adjustment or change in the terms of the Multi-Currency Notes or Currency
Indexed Notes in the event of any controls or unavailability will be made.
A Pricing Supplement with respect to the applicable Specified Currency
(which includes information with respect to applicable current foreign exchange
controls, if any) is a part of the Prospectus and this Prospectus Supplement.
The Pricing Supplement relating to each Multi-Currency Note or Currency Indexed
Note will contain information concerning relevant historical exchange rates for
the applicable Specified Currency and/or Indexed Currency, as the case may be, a
description of such currency or currencies and any exchange controls affecting
such currency or currencies. The information concerning exchange rates and
exchange rate controls, if any, is furnished as a matter of information only and
should not be regarded as indicative of the range of or trends in fluctuations
in
S-3
<PAGE> 5
currency exchange rates or an imposition of exchange rate controls that may
occur in the future. The Company disclaims any responsibility to advise
prospective purchasers of changes in such exchange rates or exchange controls
after the date of any such Pricing Supplement.
RISKS OF INDEXED NOTES
AN INVESTMENT IN CURRENCY INDEXED NOTES AND COMMODITY INDEXED NOTES
(COLLECTIVELY, "INDEXED NOTES") INDEXED, AS TO PRINCIPAL OR INTEREST OR BOTH, TO
ONE OR MORE VALUES OF CURRENCIES (INCLUDING EXCHANGE RATES BETWEEN CURRENCIES),
COMMODITIES OR INTEREST RATE OR OTHER INDICES (COLLECTIVELY, "INDICES" OR
"INDEX") ENTAILS SIGNIFICANT RISKS THAT ARE NOT ASSOCIATED WITH SIMILAR
INVESTMENTS IN A CONVENTIONAL FIXED-RATE DEBT SECURITY. IF THE INTEREST RATE OF
SUCH AN INDEXED NOTE IS SO INDEXED, IT MAY RESULT IN AN INTEREST RATE THAT IS
LESS THAN THAT PAYABLE ON A CONVENTIONAL FIXED-RATE DEBT SECURITY ISSUED AT THE
SAME TIME, INCLUDING THE POSSIBILITY THAT NO INTEREST WILL BE PAID, AND, IF THE
PRINCIPAL AMOUNT OF SUCH AN INDEXED NOTE IS SO INDEXED, THE PRINCIPAL AMOUNT
PAYABLE AT MATURITY MAY BE LESS THAN THE ORIGINAL PURCHASE PRICE OF SUCH INDEXED
NOTE IF ALLOWED PURSUANT TO THE TERMS OF SUCH INDEXED NOTE, INCLUDING THE
POSSIBILITY THAT NO PRINCIPAL WILL BE PAID. THE SECONDARY MARKET FOR SUCH
INDEXED NOTES WILL BE AFFECTED BY A NUMBER OF FACTORS, INDEPENDENT OF THE
CREDITWORTHINESS OF THE COMPANY AND THE VALUE OF THE APPLICABLE CURRENCY,
COMMODITY OR INDEX, INCLUDING THE VOLATILITY OF THE APPLICABLE CURRENCY,
COMMODITY OR INDEX, THE TIME REMAINING TO THE MATURITY OF SUCH INDEXED NOTES,
THE AMOUNT OUTSTANDING OF SUCH INDEXED NOTES AND MARKET INTEREST RATES. THE
VALUE OF THE APPLICABLE CURRENCY, COMMODITY OR INDEX DEPENDS ON A NUMBER OF
INTER-RELATED FACTORS, INCLUDING ECONOMIC, FINANCIAL AND POLITICAL EVENTS, OVER
WHICH THE COMPANY HAS NO CONTROL. ADDITIONALLY, IF THE FORMULA USED TO DETERMINE
THE PRINCIPAL AMOUNT OR INTEREST PAYABLE WITH RESPECT TO SUCH INDEXED NOTES
CONTAINS A MULTIPLE OR LEVERAGE FACTOR, THE EFFECT OF ANY CHANGE IN THE
APPLICABLE CURRENCY, COMMODITY OR INDEX WILL BE INCREASED.
THE HISTORICAL EXPERIENCE OF THE RELEVANT CURRENCIES, COMMODITIES OR
INDICES SHOULD NOT BE TAKEN AS AN INDICATION OF FUTURE PERFORMANCE OF SUCH
CURRENCIES, COMMODITIES OR INDICES DURING THE TERM OF ANY INDEXED NOTE. THE
CREDIT RATINGS ASSIGNED TO THE COMPANY'S MEDIUM-TERM NOTE PROGRAM ARE A
REFLECTION OF THE COMPANY'S CREDIT STATUS, AND, IN NO WAY, ARE A REFLECTION OF
THE POTENTIAL IMPACT OF THE FACTORS DISCUSSED ABOVE, OR ANY OTHER FACTORS, ON
THE MARKET VALUE OF INDEXED NOTES. ACCORDINGLY, PROSPECTIVE INVESTORS SHOULD
CONSULT THEIR OWN FINANCIAL AND LEGAL ADVISORS AS TO THE RISKS ENTAILED BY AN
INVESTMENT IN SUCH INDEXED NOTES AND THE SUITABILITY OF SUCH INDEXED NOTES IN
LIGHT OF THEIR PARTICULAR CIRCUMSTANCES.
DESCRIPTION OF NOTES
The following description of the particular terms of the Notes offered
hereby supplements the description of the general terms of the Securities (as
such term is used in the accompanying Prospectus) under the heading "Description
of Securities" in the accompanying Prospectus, to which description reference is
hereby made. Capitalized terms not defined herein or in the Prospectus have the
meanings specified in the Indenture and/or the Notes.
S-4
<PAGE> 6
GENERAL
The Notes constitute a single series for purposes of the Indenture and are
limited to an aggregate principal amount of $500,000,000 or its equivalent at
the time of issuance in foreign currencies or currency units. The foregoing
limit may be increased by the Company if in the future it determines that it may
wish to sell additional Notes. The Company may from time to time sell additional
series of Securities, including additional series of medium-term notes. The
aggregate principal amount of unsecured, unsubordinated indebtedness of the
Company and its consolidated subsidiaries at December 31, 1995, was
$1,868,500,000.
The Notes will be offered on a continuous basis, and each Note will mature
(the "Maturity Date") on a Business Day from nine months to thirty years from
its date of issuance, as selected by the initial purchaser and agreed to by the
Company. Each Note will be denominated in United States dollars ("$," "dollars"
or "U.S. dollars") or the Specified Currency, as specified in the applicable
Pricing Supplement. Each Note may bear interest at either (i) a fixed rate
(which may be zero if issued at a price representing a discount from the
principal amount payable at maturity) or (ii) a floating rate determined by
reference to the Commercial Paper Rate (as defined below), LIBOR, the Treasury
Rate (as defined below) or such other interest rate or formula (the "Base Rate")
specified in the applicable Pricing Supplement, which may be adjusted by a
Spread and/or a Spread Multiplier (each as defined below). Each Floating Rate
Note will mature on an Interest Payment Date (as defined below) for such Note.
The Notes may be issued as Currency Indexed Notes, the principal amount of
which payable at maturity or upon earlier redemption or repayment, and/or the
interest payable on each Interest Payment Date and at the Maturity Date, will be
determined by the difference in the rate of exchange between the Specified
Currency and another currency or currency unit set forth in the applicable
Pricing Supplement on certain specified dates, or as Commodity Indexed Notes,
the principal amount of which payable at maturity or upon earlier redemption or
repayment, and/or the interest payable on each Interest Payment Date and at the
Maturity Date, will be determined by the difference in the price of a specified
commodity on certain specified dates. See "Currency Indexed Notes" and
"Commodity Indexed Notes" below.
Each Note will be issued initially as either a Book-Entry Note or a
Certificated Note in fully registered form without coupons. Except as set forth
under "Book-Entry System" below, Book-Entry Notes will not be issuable in
certificated form.
The Notes will be issued in denominations of $100,000 and any larger amount
that is an integral multiple of $1,000 for Notes denominated in U.S. dollars,
except as otherwise specified in the applicable Pricing Supplement, and for
Notes denominated in foreign currencies or currency units, the denominations
described below under "Special Provisions Relating to Multi-Currency Notes." The
Notes will constitute unsecured, unsubordinated indebtedness of the Company and
will rank pari passu with all other unsecured, unsubordinated indebtedness of
the Company.
The Notes will not be subject to any sinking fund and will not be
redeemable at the option of the Company or repayable at the option of the
holders thereof prior to their stated maturity, except as may otherwise be
provided in the applicable Pricing Supplement. The Company may discharge its
indebtedness and its obligations or certain of its obligations under the
Indenture with respect to the Notes as described under "Description of
Securities -- Defeasance of the Indenture and Securities" in the accompanying
Prospectus.
The Pricing Supplement relating to a Note will describe the following terms
as applicable: (1) the Specified Currency of such Note; (2) if other than 100%,
the price (expressed as a percentage of the aggregate principal amount thereof)
at which such Note will be issued; (3) the date on which such Note will be
issued; (4) the Maturity Date; (5) whether such Note may be redeemed or repaid
prior to maturity, and if so, the provisions relating to such redemption or
repayment; (6) whether such Note is a Fixed Rate Note or a Floating Rate Note;
(7) if such Note is a Fixed Rate Note, the rate per annum at
S-5
<PAGE> 7
which such Note will bear interest; (8) if such Note is a Floating Rate Note,
the Base Rate, the Initial Interest Rate, the Interest Payment Dates, the Reset
Period, the Index Maturity, the Maximum Interest Rate and the Minimum Interest
Rate, if any, and the Spread or Spread Multiplier, if any (all as defined
herein), and any other terms relating to the particular method of calculating
the interest rate or rates for such Note; (9) whether such Note is a Currency
Indexed Note or a Commodity Indexed Note; (10) if such Note is a Currency
Indexed Note, the Specified Currency, the Indexed Currency, the Face Amount, the
Base Exchange Rate, the Base Interest Rate, if any, the Determination Agent and
the Reference Dealers (all as defined herein) relating to such Currency Indexed
Note and certain other information relating to Currency Indexed Notes; (11) if
such Note is a Commodity Indexed Note, the methods for determining the principal
amount payable at maturity and/or the interest, if any, payable on each Interest
Payment Date and at maturity and other information relating to Commodity Indexed
Notes; (12) whether such Note will be issued initially as a Book-Entry Note or a
Certificated Note; and (13) any other terms of such Note not inconsistent with
the provisions of the Indenture.
Notes may be issued in the form of Discount Notes (as defined below under
"U.S. Federal Income Tax Considerations -- U.S. Holders -- Original Issue
Discount"), including certain Notes offered at a discount from the principal
amount thereof due at the stated maturity of such Notes. There may or may not be
any periodic payments of interest on Discount Notes. In the event of an
acceleration of the maturity of any Discount Note, the amount payable to the
holder of such Discount Note upon such acceleration will be determined in
accordance with the applicable Pricing Supplement and the terms of such
security, but may be an amount less than the amount payable at the maturity of
the principal of such Discount Note. For federal income tax considerations with
respect to Discount Notes, see "U.S. Federal Income Tax Considerations -- U.S.
Holders -- Original Issue Discount" herein.
The Notes may be presented for registration of transfer or exchange at the
Corporate Trust Office of the Trustee in the Borough of Manhattan, The City of
New York.
References to the "Securities" in the Prospectus include the Notes. For a
further description of the Trustee and the rights attaching to different series
of Securities under the Indenture, including the covenants, modification
provisions and events of default relating to the Notes, see "Description of
Securities" in the Prospectus. Unless otherwise specified in the applicable
Pricing Supplement, each Note will have the terms described herein.
"Business Day" means any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which banking institutions are authorized
or required by law or regulation to close in New York, New York or (i) with
respect to Notes denominated in a Specified Currency other than U.S. dollars,
the principal financial center of the country of the Specified Currency as
specified in the applicable Pricing Supplement, (ii) with respect to Notes
denominated in European Currency Units ("ECUs"), Brussels, Belgium or (iii) with
respect to LIBOR Notes, London, England. "London Banking Day" means any day on
which dealings in deposits in U.S. dollars are transacted in the London
interbank market.
PAYMENT OF PRINCIPAL AND INTEREST
Payments of principal of and interest, if any, on all Notes will be made in
the applicable Specified Currency, provided that holders of certain Notes
denominated in a Specified Currency other than U.S. dollars may elect to have
such payments converted to U.S. dollars. See "Special Provisions Relating to
Multi-Currency Notes -- Payment of Principal and Interest." Unless otherwise
specified in the applicable Pricing Supplement, interest on Certificated Notes
(other than interest paid on the Maturity Date or upon earlier redemption or
repayment) will be paid by mailing a check (from an account at a bank outside of
the United States if such check is payable in a Specified Currency other than
U.S. dollars) to the holders at the address of each holder appearing on the
register for the Notes on the applicable Record Date (as defined below). At the
option of the Company or the holder of Certificated Notes in an aggregate
principal amount exceeding $5.0 million or the equivalent thereof in a Specified
Currency, interest on Certificated Notes (other than interest paid on the
Maturity Date or
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<PAGE> 8
upon earlier redemption or repayment) will be paid by wire transfer to an
account maintained by such holder with a bank located in the United States for
payments in U.S. dollars or the country of the Specified Currency for other
payments (which shall be Belgium in the case of ECUs), provided that any such
holder selecting such option shall have designated such account by written
notice to the Trustee no later than the Record Date preceding the applicable
Interest Payment Date. In the case of a Note issued between a Record Date and
the initial Interest Payment Date relating to such Record Date, interest for the
period ending on such initial Interest Payment Date shall be paid to the person
to whom such Note shall have been originally issued. Payments of principal and
interest on Certificated Notes will be made, if at maturity or upon earlier
redemption, then on the Maturity Date or the date fixed for redemption, as
applicable, upon surrender of the Certificated Notes at the Corporate Trust
Office of the Trustee in The City of New York, and if upon repayment prior to
maturity, then on the applicable date for repayment (the "Repayment Date"),
provided that the holder shall have complied with the requirements for repayment
set forth herein and in the Certificated Notes. See "Repayment" below. All such
payments at maturity or upon any earlier redemption or repayment shall be made
in immediately available funds, provided that the Certificated Notes to be paid
are presented to the Corporate Trust Office of the Trustee in The City of New
York in time for the Trustee to make such payments in such funds in accordance
with its normal procedures. Any such payments made in a Specified Currency other
than U.S. dollars shall be made by wire transfer to an account maintained by the
holder, as designated by the holder by written notice to the Trustee at least 15
calendar days prior to the date fixed for payment, with a bank located in the
country of the Specified Currency (which shall be Belgium in the case of ECUs).
Beneficial owners of Book-Entry Notes will be paid in accordance with the
Depositary's and its participants' procedures in effect from time to time as
described under "Book-Entry System" below.
Any payment of interest or principal required to be made on an Interest
Payment Date, at the Maturity Date, on a date fixed for redemption or on a
Repayment Date which is not a Business Day need not be made on such day, but may
be made, except as provided below with respect to LIBOR Notes (as defined
below), on the next succeeding Business Day with the same force and effect as if
made on the Interest Payment Date, at the Maturity Date, on the date fixed for
redemption or on the Repayment Date, as the case may be, and no additional
interest shall accrue as a result of such delayed payment. The Company will pay
any administrative costs imposed by banks in connection with making payments by
wire transfer, but any tax, assessment or governmental charge imposed upon
payments will be borne by the holders of the Notes in respect of which payments
are made.
INTEREST RATES
Interest rates, Base Rates, Spreads and Spread Multipliers are subject to
change by the Company from time to time, but no such change will affect any Note
theretofore issued or which the Company has agreed to sell. Unless otherwise
indicated in the applicable Pricing Supplement, the Interest Payment Dates and
the Record Dates for each Fixed Rate Note shall be as described below under
"Fixed Rate Notes." The Interest Payment Dates for each Floating Rate Note shall
be as indicated in the applicable Pricing Supplement, and unless otherwise
specified in the applicable Pricing Supplement, the Record Dates for a Floating
Rate Note will be the fifteenth day (whether or not a Business Day) next
preceding each Interest Payment Date.
FIXED RATE NOTES
Each Fixed Rate Note will bear interest from its date of issue at the
annual rate stated on the face thereof and in the applicable Pricing Supplement
until the principal amount thereof is paid on the Maturity Date, or upon earlier
redemption or repayment, if applicable. Unless otherwise indicated in the
applicable Pricing Supplement (and except as provided above in "Payment of
Principal and Interest"), the Interest Payment Dates for Fixed Rate Notes will
be June 15 and December 15 of each year, and the Record Dates will be June 1 and
December 1 of each year. Interest on Fixed Rate Notes will be computed and paid
on the basis of a 360-day year of twelve 30-day months.
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<PAGE> 9
FLOATING RATE NOTES
Each Floating Rate Note will bear interest from its date of issue to the
first Interest Reset Date (as defined below) for such Note at the Initial
Interest Rate (the "Initial Interest Rate") set forth on the face thereof and in
the applicable Pricing Supplement. Thereafter, the interest rate on each
Floating Rate Note for each Reset Period (as defined below) will be equal to the
interest rate calculated by reference to the Base Rate specified on the face
thereof and in the applicable Pricing Supplement plus or minus a fixed
percentage per annum (the "Spread"), if any, or times a fixed factor (the
"Spread Multiplier"), if any, in each case as specified in the applicable
Pricing Supplement, until the principal thereof is paid on the Maturity Date, or
upon earlier redemption or repayment, if applicable. The Base Rate for a
Floating Rate Note will be (a) the Commercial Paper Rate, in which case such
Note shall be a "Commercial Paper Rate Note," (b) LIBOR, in which case such Note
shall be a "LIBOR Note," (c) the Treasury Rate, in which case such Note shall be
a "Treasury Rate Note" or (d) such other Base Rate, in each case as is specified
on the face of the Floating Rate Note and in the applicable Pricing Supplement.
The Company will appoint, and enter into an agreement with, an agent (a
"Calculation Agent") to calculate interest rates on Floating Rate Notes. Unless
otherwise provided in a Pricing Supplement, the Calculation Agent for each
Floating Rate Note will be the Trustee.
The rate of interest on each Floating Rate Note will be reset daily,
weekly, monthly, quarterly, semiannually or annually (such type of period being
the "Reset Period" for such Note, and the first day of each Reset Period being
an "Interest Reset Date"), as specified on the face thereof and in the
applicable Pricing Supplement. Unless otherwise specified in the applicable
Pricing Supplement, the Interest Reset Dates will be: in the case of Floating
Rate Notes that reset daily, each Business Day; in the case of Floating Rate
Notes (other than Treasury Rate Notes) that reset weekly, Wednesday of each
week; in the case of Treasury Rate Notes that reset weekly, Tuesday of each
week; in the case of Floating Rate Notes that reset monthly, the third Wednesday
of each month; in the case of Floating Rate Notes that reset quarterly, the
third Wednesday of each March, June, September and December; in the case of
Floating Rate Notes that reset semiannually, the third Wednesday of each of two
months of each year specified on the face thereof and in the applicable Pricing
Supplement; and, in the case of Floating Rate Notes that reset annually, the
third Wednesday of one month of each year specified on the face thereof and in
the applicable Pricing Supplement; provided, however, that the interest rate in
effect for the ten days immediately prior to the Maturity Date of a Floating
Rate Note, or, with respect to any portion of the principal amount of a Floating
Rate Note to be redeemed or repaid, if applicable, the date of redemption or
Repayment Date, will be that in effect on the tenth day preceding such Maturity
Date or such date of redemption or Repayment Date. If an Interest Reset Date for
a Floating Rate Note would otherwise be a day that is not a Business Day, the
Interest Reset Date for such Floating Rate Note shall be postponed to the next
day that is a Business Day, except that, in the case of a LIBOR Note, if such
Business Day is in the next succeeding calendar month, such Interest Reset Date
shall be the immediately preceding Business Day.
The interest rate for each Reset Period will be the rate determined by the
Calculation Agent by reference to an interest determination date pertaining to
such Reset Period. The interest determination date pertaining to a Reset Period
for a Commercial Paper Rate Note (the "Commercial Paper Interest Determination
Date") will be the Business Day prior to the Interest Reset Date that commences
such Reset Period. The interest determination date pertaining to a Reset Period
for a LIBOR Note (the "LIBOR Interest Determination Date") will be the second
London Banking Day prior to the Interest Reset Date that commences such Reset
Period. The interest determination date pertaining to a Reset Period for a
Treasury Rate Note (the "Treasury Interest Determination Date") will be the day
of the week in which the Interest Reset Date that commences such Reset Period
falls on which Treasury bills would normally be auctioned. Treasury bills are
usually sold at auction on Monday of each week, unless that day is a legal
holiday, in which case the auction is usually held on the following Tuesday,
except that such auction may be held on the preceding Friday. If, as the result
of a legal holiday, an auction is so held on the preceding Friday, such Friday
will be the Treasury
S-8
<PAGE> 10
Interest Determination Date pertaining to the Reset Period commencing in the
next succeeding week. If an auction date shall fall on any Interest Reset Date
for a Treasury Rate Note, then such Interest Reset Date shall instead be the
first Business Day immediately following such auction date.
Except as provided below, interest on Floating Rate Notes will be payable,
in the case of Floating Rate Notes that reset daily, weekly or monthly, on the
third Wednesday of each month as specified on the face thereof and in the
applicable Pricing Supplement; in the case of Floating Rate Notes that reset
quarterly, on the third Wednesday of March, June, September and December of each
year; in the case of Floating Rate Notes that reset semiannually, on the third
Wednesday of each of two months of each year specified on the face thereof and
in the applicable Pricing Supplement; and, in the case of Floating Rate Notes
that reset annually, on the third Wednesday of one month of each year specified
on the face thereof and in the applicable Pricing Supplement (each such day
being an "Interest Payment Date"). If an Interest Payment Date with respect to a
Floating Rate Note would otherwise fall on a day that is not a Business Day,
such Interest Payment Date will be the following day that is a Business Day,
except that, in the case of a LIBOR Note, if such Business Day falls in the next
calendar month, such Interest Payment Date will be the immediately preceding
Business Day.
Unless otherwise indicated in the applicable Pricing Supplement, each
payment of interest on a Floating Rate Note will include interest accrued to but
excluding the applicable Interest Payment Date; provided, however, that if the
interest rate on such Note resets daily or weekly, interest payable on any
Interest Payment Date, other than interest payable on any date on which
principal for such Note is payable, will include interest accrued to and
including the immediately preceding Record Date. Accrued interest from the date
of issue or from the last date to which interest has been paid is calculated by
multiplying the face amount of a Note by an accrued interest factor. This
accrued interest factor is computed by adding the interest factors calculated
for each day from the date of issue, or from the last date to which interest has
been paid, to the date for which accrued interest is being calculated. The
interest factor (expressed as a decimal rounded upward, if necessary, to the
nearest one hundred-thousandth of a percentage point (e.g., 9.876541%, or
.09876541, being rounded to 9.87655%, or .0987655, respectively)) for each such
day is computed by dividing the interest rate (expressed as a decimal rounded
upward, if necessary, to the nearest one hundred-thousandth of a percentage
point) applicable to such date by 360, in the case of Commercial Paper Rate
Notes and LIBOR Notes, or by the actual number of days in the year, in the case
of Treasury Rate Notes.
The Calculation Agent will, upon the request of the holder of any Floating
Rate Note, provide the interest rate then in effect and, if determined, the
interest rate that will become effective on the next Interest Reset Date with
respect to such Note.
Any Floating Rate Note may also have either or both of the following: (i) a
maximum numerical interest rate limitation, or ceiling, on the rate of interest
that may accrue during any Reset Period (a "Maximum Interest Rate") and (ii) a
minimum numerical interest rate limitation, or floor, on the rate of interest
that may accrue during any Reset Period (a "Minimum Interest Rate"). The
interest rate on the Notes will in no event be higher than the maximum rate
permitted by New York law as the same may be modified by United States law of
general application. Under present New York law, the maximum rate of interest,
with certain exceptions, for any loan in an amount less than $250,000 is 16% per
annum on a simple interest basis and for any loan in an amount equal to or
greater than $250,000 but less than $2,500,000 is 25% per annum on a simple
interest basis. These limits do not apply to Notes in which $2,500,000 or more
has been invested.
"Index Maturity" is the particular maturity of the type of instrument or
obligation from which a Base Rate is calculated.
Commercial Paper Rate Notes
Each Commercial Paper Rate Note will bear interest for each Reset Period at
the interest rate (calculated with reference to the Commercial Paper Rate on the
Commercial Paper Interest Determi-
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<PAGE> 11
nation Date for such Reset Period and the Spread or Spread Multiplier, if any)
specified in such Note and in the applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing Supplement,
"Commercial Paper Rate" means, with respect to any Commercial Paper Interest
Determination Date, the Money Market Yield (calculated as described below) of
the rate on that date for commercial paper having the Index Maturity designated
in the applicable Pricing Supplement placed on behalf of industrial issuers
whose corporate bonds are rated "AA," or the equivalent, from a nationally
recognized securities rating agency as such rate is made available by the
Federal Reserve Bank of New York for such date. In the event that such rate is
not made available by the Federal Reserve Bank of New York by 3:00 p.m., New
York City time, on such Commercial Paper Interest Determination Date, then the
Commercial Paper Rate for such Commercial Paper Interest Determination Date
shall be calculated by the Calculation Agent and shall be the Money Market Yield
of the arithmetic mean (each as rounded upward, if necessary, to the nearest one
hundred-thousandth of a percentage point) of the offered rates for such
commercial paper quoted as of 11:00 a.m., New York City time, on such Commercial
Paper Interest Determination Date by three leading dealers of commercial paper
in The City of New York selected, after consultation with the Company, by the
Calculation Agent; provided, however, that if the dealers selected as aforesaid
by the Calculation Agent are not quoting as mentioned in this sentence, the
Commercial Paper Rate with respect to such Commercial Paper Interest
Determination Date will be the Commercial Paper Rate in effect on such
Commercial Paper Interest Determination Date.
"Money Market Yield" shall be a yield (expressed as a percentage rounded
upwards, if necessary, to the nearest one hundred-thousandth of a percentage
point) calculated in accordance with the following formula:
<TABLE>
<C> <C> <S>
D X 360
-------------
Money Market Yield = 360 - (D X M) X 100
</TABLE>
where "D" refers to the per annum rate for the commercial paper, quoted on a
bank discount basis and expressed as a decimal, and "M" refers to the actual
number of days in the interest period for which interest is being calculated.
LIBOR Notes
Each LIBOR Note will bear interest for each Reset Period at the interest
rate (calculated with reference to LIBOR on the LIBOR Interest Determination
Date for such Reset Period and the Spread or Spread Multiplier, if any)
specified in such Note and in the applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing Supplement, LIBOR will
be determined by the Calculation Agent in accordance with the following
provisions:
(i) On each LIBOR Interest Determination Date, LIBOR will be, as
specified in the applicable Pricing Supplement, either: (a) the arithmetic
mean of the offered rates for deposits having the Index Maturity designated
in the applicable Pricing Supplement, commencing on the second London
Business Day immediately following such LIBOR Interest Determination Date,
that appear on the Reuters Screen LIBO Page as of 11:00 a.m., London time,
on such LIBOR Interest Determination Date, if at least two such offered
rates appear on the Reuters Screen LIBO Page ("LIBOR Reuters"), or (b) the
rate for deposits having the Index Maturity designated in the applicable
Pricing Supplement, commencing on the second London Business Day
immediately following such LIBOR Interest Determination Date, that appears
on Telerate Page 3750 as of 11:00 a.m., London time, on such LIBOR Interest
Determination Date ("LIBOR Telerate"). "Reuters Screen LIBO Page" means the
display designated as page "LIBO" on the Reuters Monitor Money Rates
Service (or such other page as may replace page LIBO on that service for
the purpose of displaying London interbank offered rates of major banks).
"Telerate Page 3750" means the display designated as page "3750" on the
Telerate Service (or such other page as may replace the 3750 page on that
service or such other service or services as may be nominated by the
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<PAGE> 12
British Bankers' Association for the purpose of displaying London interbank
offered rates for deposits). If neither LIBOR Reuters nor LIBOR Telerate is
specified in the applicable Pricing Supplement, LIBOR will be determined as
if LIBOR Telerate had been specified. If at least two such offered rates
appear on the Reuters Screen LIBO Page, the rate in respect of such LIBOR
Interest Determination Date will be the arithmetic mean of such offered
rates as determined by the Calculation Agent. If fewer than two offered
rates appear on the Reuters Screen LIBO Page, or if no rate appears on
Telerate Page 3750, as applicable, LIBOR in respect of such LIBOR Interest
Determination Date will be determined as if the parties had specified the
rate described in (ii) below.
(ii) On any LIBOR Interest Determination Date on which fewer than two
offered rates appear on the Reuters Screen LIBO Page, as specified in
(i)(a) above, or on which no rate appears on Telerate Page 3750, as
specified in (i)(b) above, as applicable, LIBOR will be determined on the
basis of the rates at which deposits having the Index Maturity designated
in the applicable Pricing Supplement are offered at approximately 11:00
a.m., London time, on such LIBOR Interest Determination Date by four major
banks in the London interbank market (the "Reference Banks") selected,
after consultation with the Company, by the Calculation Agent to prime
banks in the London interbank market having the Index Maturity designated
in the applicable Pricing Supplement, commencing on the second London
Banking Day immediately following such LIBOR Interest Determination Date
and in a principal amount equal to an amount of not less than $1,000,000
that is representative for a single transaction in such market at such
time. The Calculation Agent will request the principal London office of
each of such Reference Banks to provide a quotation of its rate. If at
least two such quotations are provided, LIBOR in respect of such LIBOR
Interest Determination Date will be the arithmetic mean (rounded upward, if
necessary, to the nearest one hundred-thousandth of a percentage point) of
such quotations. If fewer than two quotations are provided, LIBOR in
respect of such LIBOR Interest Determination Date will be the arithmetic
mean (rounded upward, if necessary, to the nearest one hundred-thousandth
of a percentage point) of the rates quoted at approximately 11:00 a.m., New
York City time, on such LIBOR Interest Determination Date by three major
banks in The City of New York selected, after consultation with the
Company, by the Calculation Agent for loans in U.S. dollars to leading
European banks having the Index Maturity designated in the applicable
Pricing Supplement, commencing on the second London Banking Day immediately
following such LIBOR Interest Determination Date and in a principal amount
equal to an amount of not less than $1,000,000 that is representative for a
single transaction in such market at such time; provided, however, that if
the banks in The City of New York selected as aforesaid by the Calculation
Agent are not quoting as mentioned in this sentence, LIBOR with respect to
such LIBOR Interest Determination Date will be LIBOR in effect on such
LIBOR Interest Determination Date.
Treasury Rate Notes
Each Treasury Rate Note will bear interest for each Reset Period at the
interest rate (calculated with reference to the Treasury Rate on the Treasury
Interest Determination Date for such Reset Period and the Spread or Spread
Multiplier, if any) specified in such Note and in the applicable Pricing
Supplement.
Unless otherwise indicated in the applicable Pricing Supplement, "Treasury
Rate" means, with respect to any Treasury Interest Determination Date, the
auction average rate (expressed as a bond equivalent, rounded upward, if
necessary, to the nearest one hundred-thousandth of a percentage point, on the
basis of a year of 365 or 366 days, as applicable, and applied on a daily basis)
for the most recent auction of direct obligations of the United States
("Treasury bills") having the Index Maturity designated in the applicable
Pricing Supplement, as made available by the U.S. Department of the Treasury. In
the event that the results of the auction of Treasury bills having the Index
Maturity designated in the applicable Pricing Supplement are not made available
as provided above by 3:00 p.m., New York City time, on such Treasury Interest
Determination Date or no such auction is held in a
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<PAGE> 13
particular week (or on the preceding Friday, if applicable), then the Treasury
Rate shall be calculated by the Calculation Agent and shall be a yield to
maturity (expressed as a bond equivalent, rounded upward, if necessary, to the
nearest one hundred-thousandth of a percentage point, on the basis of a year of
365 or 366 days, as applicable, and applied on a daily basis) of the arithmetic
mean of the secondary market bid rates, as of 3:30 p.m., New York City time, on
such Treasury Interest Determination Date, of three leading primary U.S.
government securities dealers selected, after consultation with the Company, by
the Calculation Agent for the issue of Treasury bills with a remaining maturity
closest to the Index Maturity designated in the applicable Pricing Supplement;
provided, however, that if the dealers selected as aforesaid by the Calculation
Agent are not quoting as mentioned in this sentence, the Treasury Rate with
respect to such Treasury Interest Determination Date will be the Treasury Rate
in effect on such Treasury Interest Determination Date.
CURRENCY INDEXED NOTES
General.
The Company may from time to time offer Notes ("Currency Indexed Notes"),
the principal amount of which payable at the Maturity Date, and/or the interest
payable on each Interest Payment Date and at the Maturity Date, is determined by
the difference in the rate of exchange between the Specified Currency and the
other currency or currency unit specified as the Indexed Currency (the "Indexed
Currency") in the applicable Pricing Supplement on certain specified dates.
Unless otherwise specified in the applicable Pricing Supplement, holders of
Currency Indexed Notes (i) will be entitled to receive a principal amount in
respect of such Currency Indexed Notes exceeding the amount designated as the
face amount in respect of such Currency Indexed Notes in the applicable Pricing
Supplement (the "Face Amount") if, at the Maturity Date, the rate at which the
Specified Currency can be exchanged for the Indexed Currency is greater than the
rate of such exchange designated as the Base Exchange Rate, expressed in units
of the Indexed Currency per one unit of the Specified Currency, in the
applicable Pricing Supplement (the "Base Exchange Rate"), and will be entitled
to receive a principal amount in respect of such Currency Indexed Notes less
than the Face Amount of such Currency Indexed Notes, if, at the Maturity Date,
the rate at which the Specified Currency can be exchanged for the Indexed
Currency is less than such Base Exchange Rate and/or (ii) will be entitled to
receive an amount of interest on each Interest Payment Date and/or at the
Maturity Date at an interest rate greater than the base interest rate of such
Currency Indexed Note as designated in the applicable Pricing Supplement (the
"Base Interest Rate") if, on such Interest Payment Date and/or at the Maturity
Date, as the case may be, the rate at which the Specified Currency can be
exchanged into the Indexed Currency is greater than the Base Exchange Rate, and
will be entitled to receive an amount of interest on each Interest Payment Date
and/or at the Maturity Date at an interest rate less than the Base Interest Rate
if, on such Interest Payment Date and/or at the Maturity Date, as the case may
be, the rate at which the Specified Currency can be exchanged into the Indexed
Currency is less than the Base Exchange Rate, in each case determined as
described below under "Payment of Principal and Interest." Information as to the
relative historical value of the applicable Specified Currency against the
applicable Indexed Currency, any exchange controls applicable to such Specified
Currency or Indexed Currency and the tax consequences to holders will be set
forth in the applicable Pricing Supplement. See "Risk Factors."
Unless otherwise specified in the applicable Pricing Supplement, the term
"Exchange Rate Day" shall mean any day which is a Business Day in The City of
New York and, (i) if the Specified Currency or Indexed Currency is any currency
or currency unit other than the U.S. dollar or the ECU, a Business Day in the
principal financial center of the country of such Specified Currency or Indexed
Currency, or (ii) in the case of an ECU, a day which is not a non-ECU clearing
day as determined by the ECU Banking Association in Paris.
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<PAGE> 14
Payment of Principal and Interest.
Unless otherwise specified in the applicable Pricing Supplement, principal
of a Currency Indexed Note will be payable by the Company in the Specified
Currency at the Maturity Date in an amount equal to the Face Amount of the
Currency Indexed Note, plus or minus an amount determined by the determination
agent specified in the applicable Pricing Supplement (the "Determination Agent")
by reference to the difference between the Base Exchange Rate and the rate at
which the Specified Currency can be exchanged for the Indexed Currency as
determined on the second Exchange Rate Day (the "Determination Date") prior to
the Maturity Date of such Currency Indexed Note by the Determination Agent based
upon the arithmetic mean of the open market spot offer quotations for the
Indexed Currency obtained by the Determination Agent from the Reference Dealers
(as defined below) in The City of New York at 11:00 a.m., New York City time, on
the Determination Date, for an amount of Indexed Currency equal to the Face
Amount of such Currency Indexed Note multiplied by the Base Exchange Rate, for
settlement on the Maturity Date (such rate of exchange, as so determined and
expressed in units of the Indexed Currency per one unit of the Specified
Currency, is hereafter referred to as the "Spot Rate"). If such quotations from
the Reference Dealers are not available on the Determination Date due to
circumstances beyond the control of the Company or the Determination Agent, the
Spot Rate will be determined on the basis of the most recently available
quotations from the Reference Dealers. The principal amount of the Currency
Indexed Notes determined by the Determination Agent to be payable at the
Maturity Date will be payable to the holders thereof in the manner set forth
herein and in the applicable Pricing Supplement. As used herein, the term
"Reference Dealers" shall mean the three banks or firms specified as such in the
applicable Pricing Supplement or, if any of them shall be unwilling or unable to
provide the requested quotations, such other major money center bank or banks in
The City of New York selected by the Company, in consultation with the
Determination Agent, to act as Reference Dealer or Reference Dealers in
replacement therefor. In the absence of manifest error, the determination by the
Determination Agent of the Spot Rate and the principal amount of Currency
Indexed Notes payable at the Maturity Date thereof shall be final and binding on
the Company and the holders of such Currency Indexed Notes.
Unless otherwise specified in the applicable Pricing Supplement, on the
basis of the aforesaid determination by the Determination Agent and the formulae
and limitations set forth below, (i) if the Base Exchange Rate equals the Spot
Rate for any Currency Indexed Note, then the principal amount of such Currency
Indexed Note Payable at the Maturity Date will be equal to the Face Amount of
such Currency Indexed Note; (ii) if the Spot Rate exceeds the Base Exchange Rate
(i.e., the Specified Currency has appreciated against the Indexed Currency
during the term of the Currency Indexed Note), then the principal amount so
payable will be greater than the Face Amount of such Currency Indexed Note up to
an amount equal to twice the Face Amount of such Currency Indexed Note; (iii) if
the Spot Rate is less than the Base Exchange Rate (i.e., the Specified Currency
has depreciated against the Indexed Currency during the term of the Currency
Indexed Note) but is greater than one-half of the Base Exchange Rate, then the
principal amount so payable will be less than the Face Amount of such Currency
Indexed Note; and (iv) if the Spot Rate is less than or equal to one-half of the
Base Exchange Rate, then the Spot Rate will be deemed to be one-half of the Base
Exchange Rate and no principal amount of the Currency Indexed Note will be
payable at the Maturity Date.
Unless otherwise specified in the applicable Pricing Supplement, the
formulae to be used by the Determination Agent to determine the principal amount
of a Currency Indexed Note payable at the Maturity Date will be as follows:
If the Spot Rate exceeds or equals the Base Exchange Rate, the principal
amount of a Currency Indexed Note payable at the Maturity Date shall equal:
<TABLE>
<C> <C> <C> <C> <S>
Spot Rate -- Base Exchange Rate
-------------------------------
Face Amount + ( Face Amount X Spot Rate ).
</TABLE>
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<PAGE> 15
If the Base Exchange Rate exceeds the Spot Rate, the principal amount of a
Currency Indexed Note payable at the Maturity Date (which shall, in no event, be
less than zero) shall equal:
<TABLE>
<C> <C> <C> <C> <S>
Base Exchange Rate -- Spot Rate
-------------------------------
Face Amount - ( Face Amount X Spot Rate ).
</TABLE>
If the formulae set forth above are applicable to a Currency Indexed Note,
the maximum principal amount payable at the Maturity Date in respect of such a
Currency Indexed Note would be an amount equal to twice the Face Amount and the
minimum principal amount payable would be zero.
Unless otherwise specified in the applicable Pricing Supplement, interest
will be payable by the Company in the Specified Currency based on the Face
Amount of the Currency Indexed Notes, and such interest will be payable at the
rate and times and in the manner set forth herein and in the applicable Pricing
Supplement. In the event that the applicable Pricing Supplement specifies that
interest on the Currency Indexed Notes will be determined by reference to the
Indexed Currency and unless otherwise specified in such Pricing Supplement,
interest will be payable by the Company in the Specified Currency on each
Interest Payment Date and at the Maturity Date at a rate per annum equal to the
Base Interest Rate specified in the applicable Pricing Supplement multiplied by
an Interest Index Factor. The "Interest Index Factor" shall be an amount
determined by the Determination Agent by reference to the following formula:
Interest Spot Rate
--------------------
Base Exchange Rate
where, "Interest Spot Rate" is (i) if at an Interest Payment Date, the rate at
which the Specified Currency can be exchanged for the Indexed Currency as
determined on the second Exchange Rate Day prior to such Interest Payment Date
(the "Interest Determination Date") by the Determination Agent in the manner
specified in the applicable Pricing Supplement, on such Interest Determination
Date, or (ii) if at the Maturity Date, the Spot Rate. The amount of interest
determined by the Determination Agent to be payable on any Interest Payment Date
and at the Maturity Date in respect of the Currency Indexed Notes will be
payable to the holders thereof in the manner set forth herein and in the
applicable Pricing Supplement. In the absence of manifest error, the
determination by the Determination Agent of the Interest Index Factor, the
Interest Spot Rate on each Interest Payment Date, the interest payments payable
and the Spot Rate at the Maturity Date on the Currency Indexed Notes shall be
final and binding on the Company and the holders of such Currency Indexed Notes.
Unless otherwise specified in the applicable Pricing Supplement, on the
basis of the aforesaid determinations by the Determination Agent, (i) if the
Base Exchange Rate equals the Interest Spot Rate on any Interest Determination
Date or the Spot Rate on the Determination Date for any Currency Indexed Note,
then the amount of interest payable in respect of such Currency Indexed Note on
the applicable Interest Payment Date or at the Maturity Date, as the case may
be, would reflect an interest rate equal to the Base Interest Rate of such
Currency Indexed Note; (ii) if the Interest Spot Rate on any Interest
Determination Date or the Spot Rate on the Determination Date exceeds the Base
Exchange Rate (i.e., the Specified Currency has appreciated against the Indexed
Currency during the term of the Currency Indexed Note), then the amount of
interest so payable would reflect an interest rate greater than the Base
Interest Rate of such Currency Indexed Note; and (iii) if the Interest Spot Rate
on any Interest Determination Date or the Spot Rate on the Determination Date is
less than the Base Exchange Rate (i.e., the Specified Currency has depreciated
against the Indexed Currency during the term of the Currency Indexed Note), then
the amount of interest so payable would reflect an interest rate less than the
Base Interest Rate of such Currency Indexed Note.
Unless otherwise specified in the applicable Pricing Supplement, in the
event of any redemption or repayment of a Currency Indexed Note prior to its
Maturity Date, the term "Maturity Date" used above would refer to the redemption
or repayment date of such Currency Indexed Note.
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<PAGE> 16
PROSPECTIVE INVESTORS SHOULD CONSULT THEIR OWN FINANCIAL AND LEGAL ADVISORS
AS TO THE RISKS ENTAILED BY AN INVESTMENT IN CURRENCY INDEXED NOTES. SUCH
CURRENCY INDEXED NOTES ARE NOT AN APPROPRIATE INVESTMENT FOR INVESTORS WHO ARE
UNSOPHISTICATED WITH RESPECT TO FOREIGN CURRENCY TRANSACTIONS. SEE "RISK
FACTORS."
COMMODITY INDEXED NOTES
The Pricing Supplement relating to a Commodity Indexed Note will set forth
the method by which the amount of interest payable on an Interest Payment Date
and the amount of interest and principal payable at the Maturity Date in respect
of such Commodity Indexed Note will be determined, a description of certain tax
consequences to holders of Commodity Indexed Notes, a description of certain
risks associated with investments in Commodity Indexed Notes and other
information relating to such Commodity Indexed Notes.
REDEMPTION
The Notes will not be subject to redemption through the operation of a
sinking fund, but each Note may be redeemed at the option of the Company at any
time on and after the date, if any, specified at the time of sale and set forth
in the applicable Pricing Supplement and on the face of such Note. A Note will
not be redeemable if no such date is set forth on such Note. On and after such
date, if any, such Note will be redeemable in whole or from time to time in part
on notice mailed not more than 60 nor less than 30 days prior to the date of
redemption at a redemption price set forth in the applicable Pricing Supplement,
together with interest accrued thereon to the date of redemption.
REPAYMENT
The Pricing Supplement relating to each Note will indicate either that such
Note cannot be repaid prior to maturity or that such Note will be repayable at
the option of the holder prior to maturity on the Repayment Date or Repayment
Dates, if any, specified in the applicable Pricing Supplement and on the face of
such Note. A Note will not be repayable if no such Repayment Date is set forth
on such Note. On such Repayment Date or Repayment Dates, if any, such Note will
be repayable in whole or from time to time in part at a price set forth in the
applicable Pricing Supplement, together with interest accrued on such portion to
the date of repayment.
In order for a Note to be repaid, the Company must receive at the Corporate
Trust Office of the Trustee in the Borough of Manhattan, The City of New York,
during the period from and including the first day of the Repayment Option
Period set forth on the face of such Note for such Repayment Date to and
including the close of business on the last day of such Repayment Option Period
(or if such day is not a business day, the next succeeding business day): (i)
the Note with the form entitled "Option to Elect Repayment" on the reverse of
the Note duly completed, or (ii) a telegram, telex, facsimile transmission or
letter from a member of a national securities exchange or the National
Association of Securities Dealers, Inc., or a commercial bank or a trust company
in the United States of America, dated no later than the last day of such
Repayment Option Period (or if such day is not a business day, the next
succeeding business day) setting forth the name of the holder of the Note, the
principal amount of the Note, the portion of the principal amount of the Note to
be repaid, a statement that the option to elect repayment is being exercised
thereby and a guarantee that the Note to be repaid in whole or in part (with the
form entitled "Option to Elect Repayment" on the reverse of the Note duly
completed) will be received at the Corporate Trust Office of the Trustee in the
Borough of Manhattan, The City of New York, not later than five business days
after the date of such telegram, telex, facsimile transmission or letter and
such Note and form duly completed must be received at the Corporate Trust Office
of the Trustee in the Borough of Manhattan, The City of New York, by such fifth
business day. Effective exercise of any repayment option by the holder of any
Note shall be irrevocable. No transfer or exchange of any Note (or, in the event
that any Note is to be repaid in part, such portion of the Note to be repaid)
will be permitted after exercise of a repayment option. A repayment option may
be exercised by the holder of a Note for less than the entire principal amount
of the Note, provided that
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<PAGE> 17
the principal amount which is to be repaid is equal to $1,000 or any integral
multiple thereof for Notes denominated in U.S. dollars or 10,000 units of the
Specified Currency or any integral multiple thereof for Notes denominated in a
Specified Currency other than U.S. dollars. All questions as to the validity,
eligibility (including time of receipt) and acceptance of any Note for repayment
will be determined by the Company, whose determination will be final, binding
and non-appealable. For purposes of this provision, "business day" means any day
other than Saturday and Sunday or a legal holiday or any day on which banking
institutions in New York, New York are authorized or required by law or
regulation to close.
If a Note is represented by a Global Security (as defined below), the
Depositary's nominee will be the holder of such Note and, therefore, will be the
only entity that can exercise a right to repayment. In order to ensure that the
Depositary's nominee will timely exercise a right to repayment with respect to a
particular Note, the beneficial owner of such Note must instruct the broker or
other direct or indirect participant through which it holds an interest in such
Note to notify the Depositary of its desire to exercise a right to repayment.
Different firms have different cut-off times for accepting instructions from
their customers, and, accordingly, each beneficial owner should consult the
broker or other direct or indirect participant through which it holds an
interest in a Note in order to ascertain the cut-off time by which such an
instruction must be given in order for timely notice to be delivered to the
Depositary.
BOOK-ENTRY SYSTEM
Upon issuance, all Book-Entry Notes having the same Specified Currency,
Original Issue Date, Maturity Date, reset, extension, redemption and repayment
provisions, Interest Payment Dates, Record Dates, and, in the case of Fixed Rate
Notes, interest rate, or, in the case of Floating Rate Notes, Base Rate, Initial
Interest Rate, Index Maturity, Reset Period, Interest Payment Dates, Spread or
Spread Multiplier, if any, Maximum Interest Rate, if any, and Minimum Interest
Rate, if any, and in the case of Fixed Rate Notes or Floating Rate Notes that
are also Currency Indexed Notes, Specified Currency, Indexed Currency and Base
Exchange Rate, or that are also Commodity Indexed Notes, the same comparable
terms, will be represented by a single global security (a "Global Security").
Each Global Security representing Book-Entry Notes will be deposited with, or on
behalf of, DTC or such other Depositary as is specified in the applicable
Pricing Supplement, and registered in the name of the Depositary or its nominee.
Book-Entry Notes will not be exchangeable for Certificated Notes at the option
of the holder and, except as set forth below, will not otherwise be issuable in
definitive form. Unless otherwise specified in the applicable Pricing
Supplement, DTC will be the Depositary.
DTC has advised the Company and the Agents as follows: DTC is a
limited-purpose trust company organized under the New York Banking Law, a
"banking organization" within the meaning of the New York Banking Law, a member
of the Federal Reserve System, a "clearing corporation" within the meaning of
the New York Uniform Commercial Code and a "clearing agency" registered pursuant
to the provisions of Section 17A of the Securities Exchange Act of 1934. DTC was
created to hold securities of its participants and to facilitate the clearance
and settlement of securities transactions among its participants in such
securities through electronic book-entry changes in accounts of the
participants, thereby eliminating the need for physical movement of securities
certificates. DTC's participants include securities brokers and dealers
(including the Agents), banks, trust companies, clearing corporations and
certain other organizations, some of which (and/or their representatives) own
DTC. Access to DTC's book-entry system is also available to others, such as
securities brokers and dealers, banks, and trust companies that clear through or
maintain a custodial relationship with a participant, either directly or
indirectly.
Upon the issuance by the Company of Book-Entry Notes represented by a
Global Security, the Depositary will credit, on its book-entry registration and
transfer system, the respective principal amounts of the Book-Entry Notes
represented by such Global Security to the accounts of institutions that have
accounts with the Depositary ("participants"). The accounts to be credited shall
be
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<PAGE> 18
designated by the agents or underwriters of such Book-Entry Notes or by the
Company if such Book-Entry Notes are offered and sold directly by the Company.
Ownership of beneficial interests in a Global Security will be limited to
participants or persons that hold interests through participants. Ownership of
beneficial interests in Book-Entry Notes represented by a Global Security will
be shown on, and the transfer of that ownership will be effected only through,
records maintained by the Depositary (with respect to interests of participants
in the Depositary), or by participants in the Depositary or persons that may
hold interests through such participants (with respect to persons other than
participants in the Depositary). The laws of some states require that certain
purchasers of securities take physical delivery of such securities in definitive
form. Such limits and such laws may impair the ability to transfer beneficial
interests in a Global Security.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of the Global Security, the Depositary or its nominee, as the
case may be, will be considered the sole owner or holder of the Book-Entry Notes
represented by such Global Security for all purposes under the Indenture. Except
as provided below, owners of beneficial interests in Book-Entry Notes
represented by a Global Security will not be entitled to have Book-Entry Notes
represented by such Global Security registered in their names, will not receive
or be entitled to receive physical delivery of Book-Entry Notes in definitive
form and will not be considered the owners or holders thereof under the
Indenture. Unless and until it is exchanged in whole or in part for individual
certificates evidencing the Book-Entry Notes represented thereby, a Global
Security may not be transferred except as a whole by the Depositary for such
Global Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by the
Depositary or any nominee to a successor Depositary or any nominee of such
successor.
Payments of principal of and interest, if any, on the Book-Entry Notes
represented by a Global Security registered in the name of the Depositary or its
nominee will be made by the Company through the Trustee to the Depositary or its
nominee, as the case may be, as the registered owner of the Global Security.
Neither the Company, the Trustee nor the registrar for the Notes will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests in a Global Security
or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.
The Company has been advised that the Depositary, upon receipt of any
payment of principal of or interest on a Global Security, will credit
immediately the accounts of the related participants with payment in amounts
proportionate to their respective holdings in principal amount of beneficial
interest in such Global Security as shown on the records of the Depositary. The
Company expects that payments by participants to owners of beneficial interests
in a Global Security will be governed by standing customer instructions and
customary practices, as is now the case with securities held for the accounts of
customers in bearer form or registered in "street name." Such payments will be
the responsibility of such participants.
If the Depositary with respect to any Global Security or Global Securities
is at any time unwilling or unable to continue as Depositary and a successor
Depositary is not appointed by the Company within 90 days, the Company will
issue Certificated Notes in exchange for the Book-Entry Notes represented by
such Global Security or Global Securities. In addition, the Company may at any
time and in its sole discretion determine not to have Global Securities, and, in
such event, will issue Certificated Notes in exchange for the Book-Entry Notes
represented by such Global Securities.
SPECIAL PROVISIONS RELATING TO MULTI-CURRENCY NOTES
GENERAL
Unless otherwise indicated in the applicable Pricing Supplement, if any
Notes are to be denominated in U.S. dollars, payments of principal of and
interest on such Notes will be made in U.S. dollars. If any of the Notes are to
be denominated in a Specified Currency other than U.S. dollars ("Multi-Currency
Notes"), the following provisions shall apply which are in addition to, and to
the
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<PAGE> 19
extent inconsistent therewith replace, the description of the general terms and
provisions of Notes set forth in the accompanying Prospectus and elsewhere in
this Prospectus Supplement.
The authorized denominations of Multi-Currency Notes will be the amounts of
the Specified Currency for such Notes that are equivalent, at the Exchange Rate
(as defined below) for purchases of such Specified Currency on the Business Day
immediately preceding the trade date for such Notes, to $100,000 (rounded down
to an integral multiple of 10,000 units of such Specified Currency), and any
larger amount that is an integral multiple of 10,000 units of such Specified
Currency, except as otherwise specified in the applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing Supplement, payment of
the purchase price of Multi-Currency Notes will be made in immediately available
funds.
CURRENCY EXCHANGE
Unless otherwise specified in the applicable Pricing Supplement, purchasers
are required to pay for Multi-Currency Notes in the Specified Currency. At the
present time, there are limited facilities in the United States for conversion
of U.S. dollars into foreign currencies or currency units, and vice versa, and
it is believed that only a limited number of U.S. banks offer foreign currency
checking or savings facilities in the United States. However, if requested by a
purchaser at the time an offer to purchase an applicable Note is made to an
Agent (or by such other day as such Agent may determine), such Agent will
arrange for the conversion of U.S. dollars into the applicable Specified
Currency to enable the purchaser to pay for such Multi-Currency Note. Each such
conversion will be made by the Agents on such terms and subject to such
conditions, limitations and charges as the Agents may from time to time
establish in accordance with their regular foreign exchange practices. All costs
of exchange will be borne by the purchasers of the Multi-Currency Notes.
Specific information about the foreign currency or currency units in which
a particular Multi-Currency Note is denominated, including historical exchange
rates and a description of the currency or currency units and any exchange
controls, will be set forth in the applicable Pricing Supplement.
PAYMENT OF PRINCIPAL AND INTEREST
Principal and interest, if any, on Multi-Currency Notes will be paid by the
Company in the Specified Currency. If so specified in the applicable Pricing
Supplement, at the request of a holder of a Multi-Currency Note, payments of
principal and interest in respect of such Note shall be paid in U.S. dollars.
Under such circumstances, the Company would be required to tender payment in
U.S. dollars at the Exchange Rate, and any costs associated with such conversion
would be borne by such holder through deduction from such payments. In such
case, a holder may elect to receive payments in U.S. dollars by delivering a
written request to the Trustee not later than the Record Date immediately
preceding the applicable payment date. Such election will remain in effect until
notice to the Trustee, but written notice of any such revocation must be
received by the Trustee not later than the Record Date immediately preceding the
next Interest Payment Date or the fifteenth day preceding the Maturity Date, as
the case may be. Upon request, the Trustee will mail a copy of a form of request
to any holder.
OUTSTANDING MULTI-CURRENCY NOTES
For purposes of calculating the principal amount of any Multi-Currency Note
payable in a Specified Currency which is outstanding under the Indenture for
purposes of determining whether the holders of the requisite principal amount of
outstanding Securities have given any request, demand, authorization, direction,
notice, consent or waiver under such Indenture or whether a quorum is present at
a meeting of holders of Securities, the principal amount of such Multi-Currency
Note at any time outstanding shall be deemed to be the U.S. dollar equivalent,
determined as of the date of the original issuance of such Multi-Currency Note,
of the principal amount of such Multi-Currency Note. Unless otherwise indicated
in the applicable Pricing Supplement, whenever the Indenture provides for
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<PAGE> 20
any distribution to holders, any amount in respect of any Multi-Currency Note
shall be treated for any such distribution as that amount of U.S. dollars that
could be obtained for such amount on such reasonable basis of exchange as the
Company may specify.
PAYMENT CURRENCY
If the principal of, or interest on, any Note is payable in a Specified
Currency that is not available to the Company for making payments thereof due to
the imposition of exchange controls or other circumstances beyond the control of
the Company, the Company will be entitled to satisfy its obligations to holders
of the Notes by making such payment in U.S. dollars on the basis of the Exchange
Rate on the second Business Day preceding the Interest Payment Date or the
second Business Day preceding the maturity of an installment of principal, as
the case may be (or, if no rate is quoted for such Specified Currency on such
date, the last date such rate is quoted). Any payment made under such
circumstances in U.S. dollars where the required payment is in a Specified
Currency other than U.S. dollars will not constitute an Event of Default under
the Indenture.
"Exchange Rate" means (a) with respect to U.S. dollars in which payment is
to be made on Multi-Currency Notes denominated in a composite currency unit, the
exchange rate between U.S. dollars and such composite currency unit reported by
the agency or organization, if any, responsible for overseeing such composite
currency unit or by the Council of the European Communities (in the case of ECU,
whose reports are currently based on the rates in effect at 2:30 p.m., Brussels
time, on the relevant exchange markets), as appropriate, on the applicable
Record Date with respect to an Interest Payment Date or the fifteenth day
immediately preceding the maturity of an installment of principal, or on such
other date provided in the Indenture, as the case may be; (b) with respect to
U.S. dollars in which payment is to be made on Multi-Currency Notes denominated
in a foreign currency, the noon U.S. dollar buying rate for that currency for
cable transfers quoted by the Exchange Rate Agent in The City of New York
designated by the Company on the Record Date with respect to an Interest Payment
Date or the fifteenth day immediately preceding the maturity of an installment
of principal, or on such other date provided therefor, as the case may be, as
certified for customs purposes by the Federal Reserve Bank of New York; and (c)
with respect to a Specified Currency other than U.S. dollars in which payment is
to be made on Multi-Currency Notes converted into U.S. dollars pursuant to the
Indenture as described above under "Payment Currency," the noon U.S. dollar
selling rate for that currency for cable transfers quoted by the Exchange Rate
Agent in The City of New York on the second Business Day preceding the
applicable Interest Payment Date or the second Business Day preceding the
maturity of an installment of principal, as the case may be, as certified for
customs purposes by the Federal Reserve Bank of New York. If for any reason such
rates are not available with respect to one or more currencies for which an
Exchange Rate is required, the Company shall use such quotation of the Federal
Reserve Bank of New York as of the most recent available date, or quotations
from one or more commercial banks in The City of New York or in the country of
issue of the currency in question, or such other quotations as the Company, in
each case, shall deem appropriate. If there is more than one market for dealing
in any currency by reason of foreign exchange regulations or otherwise, the
market to be used in respect of such currency shall be the largest market upon
which a nonresident issuer of securities designated in such currency would
purchase such currency in order to make payments in respect of such securities.
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<PAGE> 21
U.S. FEDERAL INCOME TAX CONSIDERATIONS
The following is a summary of the material U.S. federal income tax
consequences resulting from the beneficial ownership of Notes by certain
persons. This summary does not purport to consider all the possible U.S. federal
tax consequences of the purchase, ownership or disposition of the Notes and is
not intended to reflect the individual tax position of any beneficial owner. It
deals only with Notes denominated in U.S. dollars, Notes denominated in
currencies or composite currencies other than U.S. dollars ("Foreign Currency"),
and Foreign Currency in each case held as capital assets. Moreover, except as
expressly indicated, it addresses initial purchasers and does not address
beneficial owners that may be subject to special tax rules, such as banks,
insurance companies, dealers in securities or currencies, purchasers that hold
Notes (or Foreign Currency) as a hedge against currency risks or as part of a
straddle with other investments or as part of a "synthetic security" or other
integrated investment (including a "conversion transaction") comprised of a Note
and one or more other investments, or purchasers that have a "functional
currency" other than the U.S. dollar. Except to the extent discussed below under
"Non-U.S. Holders," this summary is not applicable to non-United States persons
not subject to U.S. federal income tax on their worldwide income. This summary
is based upon the U.S. federal tax laws and regulations as now in effect and as
currently interpreted and does not take into account possible changes in such
tax laws or such interpretations, any of which may be applied retroactively. It
does not include any description of the tax laws of any state, local or foreign
governments that may be applicable to the Notes or holders thereof, and it does
not discuss the tax treatment of Notes denominated in certain hyperinflationary
currencies or dual currency Notes.
Persons considering the purchase of Notes should consult their own tax
advisors concerning the tax consequences of holding Notes, including the
application of the U.S. federal tax laws discussed below to their particular
situations, as well as the application of state, local and other national tax
laws.
U.S. HOLDERS
Payments of Interest
In general, interest on a Note, whether payable in U.S. dollars or a
Foreign Currency (other than certain payments on a Discount Note, as defined and
described below under "Original Issue Discount"), will be taxable to a
beneficial owner who or which is (i) a citizen or resident of the United States,
(ii) a corporation created or organized under the laws of the United States or
any State thereof (including the District of Columbia) or (iii) a person
otherwise subject to United States federal income taxation on its worldwide
income (a "U.S. Holder") as ordinary income at the time it is received or
accrued, depending on the holder's method of accounting for tax purposes. If an
interest payment is denominated in or determined by reference to a Foreign
Currency, then special rules, described below under "Foreign Currency Notes,"
apply.
Original Issue Discount
The following discussion summarizes the United States federal income tax
consequences to U.S. Holders of Notes issued with original issue discount
("OID") for federal income tax purposes. U.S. Holders of a Note issued with OID
generally will be subject to special tax accounting rules provided in the
Internal Revenue Code of 1986, as amended (the "Code"). On February 2, 1994, the
Treasury Department published final regulations (the "OID Regulations"), which
expand and illustrate the rules provided by the Code. On December 16, 1994, the
Treasury Department proposed new regulations regarding the tax treatment of debt
instruments that provide for one or more contingent payments. The proposed
regulations would also modify the rules relating to variable rate debt
instruments. Subsequent versions of the proposed regulations or corresponding
final regulations may adopt positions that may apply to a Note and that may be
contrary to the positions discussed below. For this reason, purchasers of Notes
issued with OID should carefully examine the Pricing Supplement and consult
their own tax advisers with respect to the current application of the OID rules
to the Notes.
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<PAGE> 22
Special rules apply to OID on a Discount Note that is denominated in
Foreign Currency. See "Foreign Currency Notes -- Foreign Currency Discount
Notes" below.
General. A Note will be treated as issued with OID (a "Discount Note") if
the excess of the Note's "stated redemption price at maturity" over its issue
price is greater than a de minimis amount (set forth in the Code and the OID
Regulations). Under the OID Regulations, the "stated redemption price at
maturity" of a Note is the sum of all payments provided by the Note that are not
payments of "qualified stated interest." A "qualified stated interest" payment
includes any stated interest payment on a Note that is unconditionally payable
in cash or property (other than debt instruments of the Company) at least
annually at a single fixed rate (or at certain floating rates) that
appropriately takes into account the length of the interval between stated
interest payments. Generally, the issue price of a Note (or any Note that is
part of an issue of Notes) will be the first price at which a substantial amount
of Notes that are part of such issue of Notes are sold (other than to
underwriters, placement agents or wholesalers). The applicable Pricing
Supplement will state whether a particular issue of Notes will constitute an
issue of Discount Notes.
In general, if the excess of a Note's stated redemption price at maturity
over its issue price is de minimis, then such excess constitutes "de minimis
OID." Under the OID Regulations, unless a U.S. Holder makes the election
described below under "Election to Treat All Interest as Original Issue
Discount," such a Note will not be treated as issued with OID (in which case the
following paragraphs under "Original Issue Discount" will not apply) and a U.S.
Holder of such a Note will recognize capital gain with respect to such de
minimis OID as stated principal payments on the Note are made. The amount of
such gain with respect to each such payment will equal the product of the total
amount of the Note's de minimis OID and a fraction, the numerator of which is
the amount of the principal payment made and the denominator of which is the
stated principal amount of the Note.
The OID Regulations provide that a Note bearing interest at a floating rate
(a "Floating Rate Note") will bear qualified stated interest if the Floating
Rate Note provides for stated interest at: (1) one or more qualified floating
rates; (2) a single fixed rate and one or more qualified floating rates; (3) a
single objective rate; or (4) a single fixed rate and a single objective rate
that is a qualified inverse floating rate.
For this purpose, a variable interest rate is a qualified floating rate if
variations in the value of the rate can reasonably be expected to measure
contemporaneous variations in the cost of newly borrowed funds in the currency
in which the debt instrument is denominated. A variable rate is not qualified
stated interest if, among other things, the terms of the Note provide for a
maximum interest rate or a minimum interest rate that is reasonably expected as
of the issue date to cause the yield on the debt instrument to be significantly
less, in the case of a maximum rate, or significantly more, in the case of a
minimum rate, than the expected yield determined without the maximum or minimum
rate, as the case may be.
An objective rate is a rate that is determined using a single fixed formula
and that is based on: (1) one or more qualified floating rates; (2) one or more
rates where each rate would be a qualified floating rate for a debt instrument
denominated in a currency other than the currency in which the debt instrument
is denominated; (3) the yield or change in the price of actively traded personal
property; or (4) a combination of the foregoing rates. An objective rate is a
qualified inverse floating rate if the rate is equal to a fixed rate minus a
qualified floating rate, and the variation in the rate can be reasonably
expected to inversely reflect contemporaneous variations in the cost of newly
borrowed funds. A variable rate of interest on a debt instrument is not an
objective rate if it is reasonably expected that the average value of the rate
during the first half of the instrument's term will be either significantly less
than or significantly greater than the average value of the rate during the
final half of the debt instrument's term. Unless specified in the applicable
Pricing Supplement, Floating Rate Notes will not be Discount Notes.
The Code and the OID Regulations require a U.S. Holder of a Discount Note
having a maturity of more than one year from its date of issue to include OID in
gross income, as it accrues economically on
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a constant yield basis, without regard to the holder's method of accounting for
tax purposes and prior to the receipt of cash attributable to such income. In
addition, qualified stated interest is included in income under the U.S.
Holder's regular method of accounting.
The amount of OID includible in gross income by a U.S. Holder of a Discount
Note is the sum of the "daily portions" of OID with respect to the Discount Note
for each day during the taxable year in which the U.S. Holder holds such
Discount Note ("accrued OID"). The daily portion is determined by allocating to
each day in any "accrual period" a pro rata portion of the OID allocable to that
accrual period. Under the OID Regulations, accrual periods with respect to a
Note may be any set of periods (which may be of varying lengths) selected by the
U.S. Holder as long as (i) no accrual period is longer than one year and (ii)
each scheduled payment of interest or principal on the Note occurs on the first
day or final day of an accrual period.
The amount of OID allocable to an accrual period equals the excess of (a)
the product of the Discount Note's adjusted issue price at the beginning of the
accrual period and the Discount Note's yield to maturity (determined on the
basis of compounding at the close of each accrual period and properly adjusted
for the length of the accrual period) over (b) the sum of any payments of
qualified stated interest on the Discount Note allocable to the accrual period.
In the case of a Floating Rate Note, both the yield to maturity and the
qualified stated interest will generally be determined for these purposes as
though the Note will bear interest in all periods at a fixed rate equal to the
value of the rate as of the issue date. In the case of Floating Rate Notes using
an objective rate other than a qualified inverse floating rate, the yield to
maturity and the qualified stated interest will generally be determined as
though the Note will bear interest in all periods at a fixed rate equal to the
rate that reflects the yield that is reasonably expected for the Note.
(Additional rules may apply if interest on a Floating Rate Note is based on more
than one interest index.)
The "adjusted issue price" of a Discount Note at the beginning of the first
accrual period is the issue price. Thereafter, the adjusted issue price at the
beginning of any accrual period is (x) the sum of the issue price of such
Discount Note, the accrued OID for each prior accrual period (determined without
regard to the amortization of any acquisition premium or bond premium, which are
discussed below), and the amount of any qualified stated interest on the Note
that has accrued prior to the beginning of the accrual period but is not payable
until a later date, less (y) any prior payments on the Discount Note that were
not qualified stated interest payments. If a payment (other than a payment of
qualified stated interest) is made on the first day of an accrual period, then
the adjusted issue price at the beginning of such accrual period is reduced by
the amount of the payment. If a portion of the initial purchase price of a Note
is attributable to interest that accrued prior to the Note's issue date, the
first stated interest payment on the Note is to be made within one year of the
Note's issue date and such payment will equal or exceed the amount of
pre-issuance accrued interest, then the issue price will be decreased by the
amount of pre-issuance accrued interest, in which case a portion of the first
stated interest payment will be treated as a return of the excluded pre-issuance
accrued interest and not as an amount payable on the Note.
The OID Regulations contain certain special rules that generally allow any
reasonable method to be used in determining the amount of OID allocable to a
short initial accrual period (if all other accrual periods are of equal length)
and require that the amount of OID allocable to the final accrual period equal
the excess of the amount payable at the maturity of the Discount Note (other
than any payment of qualified stated interest) over the Discount Note's adjusted
issue price as of the beginning of such final accrual period. In addition, if an
interval between payments of qualified stated interest on a Discount Note
contains more than one accrual period, then the amount of qualified stated
interest payable at the end of such interval is allocated pro rata (on the basis
of their relative lengths) between the accrual periods contained in the
interval.
U.S. Holders of Discount Notes generally will have to include in income
increasingly greater amounts of OID over the life of the Notes.
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Acquisition Premium. A U.S. Holder that purchases a Discount Note at its
original issuance for an amount in excess of its issue price but less than its
stated redemption price at maturity (any such excess being "acquisition
premium"), and that does not make the election described below under "Election
To Treat All Interest as Original Issue Discount," reduces the daily portions of
OID by an amount equal to the amount which would be the daily portion for such
day (determined without regard to this paragraph) multiplied by a fraction, the
numerator of which is the excess of the U.S. Holder's purchase price for the
Note over the issue price, and the denominator of which is the excess of the sum
of all amounts payable on the Note after the purchase date, other than payments
of qualified stated interest, over the Note's issue price. Alternatively, a U.S.
Holder may elect to compute OID accruals as described under "Original Issue
Discount -- General" above, treating the U.S. Holder's purchase price as the
issue price.
Optional Redemption or Repurchase. If the Company has an option to redeem
a Discount Note, or the U.S. Holder has an option to cause a Discount Note to be
repurchased, prior to the Discount Note's stated maturity, such option will be
presumed to be exercised if, by utilizing any date on which such Discount Note
may be redeemed or repurchased as the maturity date and the amount payable on
such date in accordance with the terms of such Discount Note (the "redemption
price") as the stated redemption price at maturity, the yield on the Discount
Note would be (i) in the case of an option of the Company, lower than its yield
to stated maturity, or (ii) in the case of an option of the U.S. Holder, higher
than its yield to stated maturity. If such option is not in fact exercised when
presumed to be exercised, the Note would be treated solely for OID purposes as
if it were redeemed or repurchased, and a new Note were issued, on the presumed
exercise date for an amount equal to the Discount Note's adjusted issue price on
that date.
Short-Term Notes. Under the Code, special rules apply with respect to OID
on Notes that mature one year or less from the date of issuance ("Short-Term
Notes"). In general, a cash basis U.S. Holder of a Short-Term Note is not
required to include OID in income as it accrues for United States federal income
tax purposes unless it elects to do so. Accrual basis U.S. Holders and certain
other U.S. Holders, including banks, regulated investment companies, dealers in
securities and cash basis U.S. Holders who so elect, are required to include OID
in income as it accrues on Short-Term Notes on a straight-line basis or, at the
election of the U.S. Holder, under the constant yield method (based on daily
compounding). In the case of U.S. Holders not required and not electing to
include OID in income currently, any gain realized on the sale or retirement of
Short-Term Notes will be ordinary income to the extent of the OID accrued on a
straight-line basis (unless an election is made to accrue the original issue
discount under the constant yield method) through the date of sale or
retirement. U.S. Holders who are not required and do not elect to include OID on
Short-Term Notes in income as it accrues will be required to defer deductions
for interest on borrowings allocable to Short-Term Notes in an amount not
exceeding the deferred income until the deferred income is realized.
Any U.S. Holder of a Short-Term Note can elect to apply the rules in the
preceding paragraph taking into account the amount of "acquisition discount," if
any, with respect to the Note (rather than the OID with respect to such Note).
Acquisition discount is the excess of the stated redemption price at maturity of
the Short-Term Note over the U.S. Holder's purchase price therefor. Acquisition
discount will be treated as accruing on a ratable basis or, at the election of
the U.S. Holder, on a constant-yield basis.
For purposes of determining the amount of OID subject to these rules, the
OID Regulations provide that no interest payments on a Short-Term Note are
qualified stated interest, but instead such interest payments are included in
the Short-Term Note's stated redemption price at maturity. Actual receipt of
stated interest will be taxable to the extent of accrued OID at the time of
receipt.
Notes Purchased at a Premium
Under the Code, a U.S. Holder that purchases a Note for an amount in excess
of its stated redemption price at maturity will not be subject to the OID rules
and may elect to treat such excess as
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"amortizable bond premium," in which case the amount of qualified stated
interest required to be included in the U.S. Holder's income each year with
respect to interest on the Note will be reduced by the amount of amortizable
bond premium allocable (based on the Note's yield to maturity) to such year. Any
election to amortize bond premium is applicable to all bonds (other than bonds
the interest on which is excludible from gross income) held by the U.S. Holder
at the beginning of the first taxable year to which the election applies or
thereafter acquired by the U.S. Holder, and may not be revoked without the
consent of the Internal Revenue Service ("IRS"). A U.S. Holder that does not
elect to amortize bond premium will generally be entitled to treat the premium
as capital loss when the Note matures. See also "Election to Treat All Interest
as Original Issue Discount" below.
Notes Purchased at a Market Discount
A Note, other than a Short-Term Note, will be treated as issued at a market
discount (a "Market Discount Note") if the amount for which a U.S. Holder
purchased the Note is less than the Note's issue price, subject to a de minimis
rule similar to the rule relating to de minimis OID described under "Original
Issue Discount -- General."
In general, any gain recognized on the maturity or disposition of a Market
Discount Note will be treated as ordinary income to the extent that such gain
does not exceed the accrued market discount on such Note. Alternatively, a U.S.
Holder of a Market Discount Note may elect to include market discount in income
currently over the life of the Market Discount Note. Such an election applies to
all debt instruments with market discount acquired by the electing U.S. Holder
on or after the first day of the first taxable year to which the election
applies and may not be revoked without the consent of the IRS.
Market discount accrues on a straight-line basis unless the U.S. Holder
elects to accrue such discount on a constant yield to maturity basis. Such an
election is applicable only to the Market Discount Note with respect to which it
is made and is irrevocable. A U.S. Holder of a Market Discount Note that does
not elect to include market discount in income currently generally will be
required to defer deductions for interest on borrowings allocable to such Note
in an amount not exceeding the accrued market discount on such Note until the
maturity or disposition of such Note.
The market discount rules do not apply to a Short-Term Note.
Election To Treat All Interest as Original Issue Discount
Any U.S. Holder may elect to include in gross income all interest that
accrues on a Note using the constant yield method described above under the
heading "Original Issue Discount -- General," with the modifications described
below. For purposes of this election, interest includes stated interest, OID, de
minimis OID, market discount acquisition discount, de minimis market discount
and unstated interest, as adjusted by any amortizable bond premium or
acquisition premium.
In applying the constant yield method to a Note with respect to which this
election has been made, the issue price of the Note will equal the electing U.S.
Holder's adjusted basis in the Note immediately after its acquisition, the issue
date of the Note will be the date of its acquisition by the electing U.S.
Holder, and no payments on the Note will be treated as payments of qualified
stated interest. This election is generally applicable only to the Note with
respect to which it is made and may not be revoked without the consent of the
IRS. If this election is made with respect to a Note with amortizable bond
premium, the electing U.S. Holder will be deemed to have elected to apply
amortizable bond premium against interest with respect to all debt instruments
with amortizable bond premium (other than debt instruments the interest on which
is excludible from gross income) held by such electing U.S. Holder as of the
beginning of the taxable year in which the election is made or any debt
instruments acquired thereafter. The deemed election with respect to amortizable
bond premium may not be revoked without the consent of the IRS.
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If the election described above to apply the constant yield method to all
interest on a Note is made with respect to a Market Discount Note, as defined
above, then the electing U.S. Holder will be treated as having made the election
discussed above under "Notes Purchased at a Market Discount" to include market
discount in income currently over the life of all debt instruments held or
thereafter acquired by such U.S. Holder.
Purchase, Sale and Retirement of the Notes
General. A U.S. Holder's tax basis in a Note generally will equal its U.S.
dollar cost (which, in the case of a Note purchased with a Foreign Currency,
will be the U.S. dollar value of the purchase price on the date of purchase),
(i) increased by the amount of any OID or market discount (or acquisition
discount, in the case of a Short Term Note) included in the U.S. Holder's income
with respect to the Note and the amount, if any, of income attributable to de
minimis OID included in the U.S. Holder's income with respect to the Note, and
(ii) reduced by the amount of any payments that are not qualified stated
interest payments, and the amount of any amortizable bond premium applied to
reduce interest on the Note. A U.S. Holder generally will recognize gain or loss
on the sale or retirement of a Note equal to the difference between the amount
realized on the sale or retirement and the U.S. Holder's tax basis in the Note.
The amount realized on a sale or retirement for an amount in Foreign Currency
will be the U.S. dollar value of such amount on the date of sale or retirement.
Except to the extent described above under "Original Issue Discount -- Short
Term Notes" or "Notes Purchased at a Market Discount" or below under "Foreign
Currency Notes -- Exchange Gain or Loss," and except to the extent attributable
to accrued but unpaid interest, gain or loss recognized on the sale or
retirement of a Note will be capital gain or loss and will be long-term capital
gain or loss if the Note was held for more than one year.
Foreign Currency Notes
Interest Payments. If an interest payment is denominated in or determined
by reference to a Foreign Currency, the amount of income recognized by a cash
basis U.S. Holder will be the U.S. dollar value of the interest payment, based
on the exchange rate in effect on the date of receipt, regardless of whether the
payment is in fact converted into U.S. dollars. Accrual basis U.S. Holders may
determine the amount of income recognized with respect to such interest payment
in accordance with either of two methods. Under the first method, the amount of
income recognized will be based on the average exchange rate in effect during
the interest accrual period (or, with respect to an accrual period that spans
two taxable years, the partial period within the taxable year). Upon receipt of
an interest payment (including a payment attributable to accrued but unpaid
interest upon the sale or retirement of a Note) determined by reference to a
Foreign Currency, an accrual basis U.S. Holder will recognize ordinary income or
loss measured by the difference between such average exchange rate and the
exchange rate in effect on the date of receipt, regardless of whether the
payment is in fact converted into U.S. dollars. Under the second method, an
accrual basis U.S. Holder may elect to translate interest income into U.S.
dollars at the spot exchange rate in effect on the last day of the accrual
period or, in the case of an accrual period that spans two taxable years, at the
exchange rate in effect on the last day of the partial period within the taxable
year. Additionally, if a payment of interest is actually received within 5
business days of the last day of the accrual period or taxable year, an accrual
basis U.S. Holder applying the second method may instead translate such accrued
interest into U.S. dollars at the spot exchange rate in effect on the day of
actual receipt (in which case no exchange gain or loss will result). Any
election to apply the second method will apply to all debt instruments held by
the U.S. Holder at the beginning of the first taxable year to which the election
applies or thereafter acquired by the U.S. Holder and may not be revoked without
the consent of the IRS.
Exchange of Amounts in Other than U.S. Dollars. Foreign Currency received
as interest on a Note or on the sale or retirement of a Note will have a tax
basis equal to its U.S. dollar value at the time such interest is received or at
the time of such sale or retirement, as the case may be. Foreign Currency that
is purchased will generally have a tax basis equal to the U.S. dollar value of
the Foreign Currency on
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the date of purchase. Any gain or loss recognized on a sale or other disposition
of a Foreign Currency (including its use to purchase Notes or upon exchange for
U.S. dollars) will be ordinary income or loss.
Foreign Currency Discount Notes. OID for any accrual period on a Discount
Note that is denominated in a Foreign Currency will be determined in the Foreign
Currency and then translated into U.S. dollars in the same manner as stated
interest accrued by an accrual basis U.S. Holder. Upon receipt of an amount
attributable to original issue discount (whether in connection with a payment of
interest or the sale or retirement of a Note), a U.S. Holder may recognize
ordinary income or loss.
Amortizable Bond Premium. In the case of a Note that is denominated in a
Foreign Currency, bond premium will be computed in units of Foreign Currency,
and amortizable bond premium will reduce interest income in units of the Foreign
Currency. At the time amortized bond premium offsets interest income, a U.S.
Holder may realize ordinary income or loss, measured by the difference between
exchange rates at that time and at the time of the acquisition of the Notes.
Market Discount. Market discount is determined in units of the Foreign
Currency. Accrued market discount that is required to be taken into account on
the maturity or upon disposition of a Note is translated into U.S. dollars at
the exchange rate on the maturity or the disposition date, as the case may be
(and no part is treated as exchange gain or loss). Accrued market discount
currently includible in income by an electing U.S. Holder is translated into
U.S. dollars at the average exchange rate for the accrual period (or the partial
accrual period during which the U.S. Holder held the Note), and exchange gain or
loss is determined on maturity or disposition of the Note (as the case may be)
in the manner described above under "Foreign Currency Notes -- Interest
Payments" with respect to the computation of exchange gain or loss on the
receipt of accrued interest by an accrual method holder.
Exchange Gain or Loss. Gain or loss recognized by a U.S. Holder on the
sale or retirement of a Note that is attributable to changes in exchange rates
will be treated as ordinary income or loss. However, exchange gain or loss is
taken into account only to the extent of total gain or loss realized on the
transaction.
Indexed Notes
The applicable Pricing Supplement will contain a discussion of any special
United States federal income tax rules with respect to Currency Indexed Notes,
Commodity Indexed Notes or other indexed Notes.
NON-U.S. HOLDERS
Subject to the discussion of backup withholding below, payments of
principal (and premium, if any) and interest (including OID) by the Company or
any agent of the Company (acting in its capacity as such) to any holder of a
Note that is not a U.S. Holder (a "Non-U.S. Holder") will not be subject to U.S.
federal withholding tax, provided, in the case of interest (including OID), that
(i) the Non-U.S. Holder does not actually or constructively own 10% or more of
the total combined voting power of all classes of stock of the Company entitled
to vote, (ii) the Non-U.S. Holder is not a controlled foreign corporation for
U.S. tax purposes that is related to the Company (directly or indirectly)
through stock ownership and (iii) either (A) the Non-U.S. Holder certifies to
the Company or its agent under penalties of perjury that it is not a United
States person and provides its name and address or (B) a securities clearing
organization, bank or other financial institution that holds customers'
securities in the ordinary course of its trade or business (a "financial
institution") and holds the Note certifies to the Company or its agent under
penalties of perjury that such statement has been received from the Non-U.S.
Holder by it or by another financial institution and furnishes the payor with a
copy thereof. A Non-U.S. Holder of a Note providing for payments of contingent
interest within the meaning of Section 871(h) of the Code, will not, however, be
exempt from U.S. federal withholding tax with respect to payments of such
contingent interest. The applicable Pricing Supplement will contain a
description of U.S. federal withholding tax consequences to Non-U.S. Holders of
a purchase of a Note providing for payments of such contingent interest.
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If a Non-U.S. Holder is engaged in a trade or business in the United States
and interest (including OID) on the Note is effectively connected with the
conduct of such trade or business, the Non-U.S. Holder, although exempt from the
withholding tax discussed in the preceding paragraph (provided that such holder
furnishes a properly executed IRS Form 4224 on or before any payment date to
claim such exemption), may be subject to U.S. federal income tax on such
interest (or OID) in the same manner as if it were a U.S. Holder. In addition,
if the Non-U.S. Holder is a foreign corporation, it may be subject to a branch
profits tax equal to 30% of its effectively connected earnings and profits for
the taxable year, subject to certain adjustments. For purposes of the branch
profits tax, interest (including OID) on a Note will be included in the earnings
and profits of such holder if such interest (or OID) is effectively connected
with the conduct by such holder of a trade or business in the United States. In
lieu of the certificate described in the preceding paragraph, such a holder must
provide the payor with a properly executed IRS Form 4224 to claim an exemption
from U.S. federal withholding tax.
Any capital gain, market discount or exchange gain realized on the sale,
exchange, retirement or other disposition of a Note by a Non-U.S. Holder will
not be subject to U.S. federal income or withholding taxes if (i) such gain is
not effectively connected with a U.S. trade or business of the Non-U.S. Holder
and (ii) in the case of an individual, such Non-U.S. Holder (A) is not present
in the United States for 183 days or more in the taxable year of the sale,
exchange, retirement or other disposition or (B) does not have a tax home (as
defined in Section 911(d)(3) of the Code) in the United States in the taxable
year of the sale, exchange, retirement or other disposition and the gain is not
attributable to an office or other fixed place of business maintained by such
individual in the United States.
Notes held by an individual who is neither a citizen nor a resident of the
United States for U.S. federal tax purposes at the time of such individual's
death will not be subject to U.S. federal estate tax, provided that the income
from such Notes was not or would not have been effectively connected with a U.S.
trade or business of such individual and that such individual qualified for the
exemption from U.S. federal withholding tax (without regard to the certification
requirements) described above.
PURCHASERS OF NOTES THAT ARE NON-U.S. HOLDERS SHOULD CONSULT THEIR OWN TAX
ADVISORS WITH RESPECT TO THE POSSIBLE APPLICABILITY OF UNITED STATES WITHHOLDING
AND OTHER TAXES UPON INCOME REALIZED IN RESPECT OF THE NOTES.
INFORMATION REPORTING AND BACKUP WITHHOLDING
For each calendar year in which the Notes are outstanding, the Company is
required to provide the IRS with certain information, including the holder's
name, address and taxpayer identification number (either the holder's Social
Security number or its employer identification number, as the case may be), the
aggregate amount of principal and interest paid (including OID, if any) to that
holder during the calendar year and the amount of tax withheld, if any. This
obligation, however, does not apply with respect to certain U.S. Holders,
including corporations, tax-exempt organizations, qualified pension and profit
sharing trusts and individual retirement accounts.
In the event that a U.S. Holder subject to the reporting requirements
described above fails to supply its correct taxpayer identification number in
the manner required by applicable law or underreports its tax liability, the
Company, its agents or paying agents or a broker may be required to "backup"
withhold a tax equal to 31% of each payment of interest (including OID) and
principal (and premium, if any) on the Notes. This backup withholding is not an
additional tax and may be credited against the U.S. Holder's U.S. federal income
tax liability, provided that the required information is furnished to the IRS.
Under current Treasury Regulations, backup withholding and information
reporting will not apply to payments made by the Company or any agent thereof
(in its capacity as such) to a Non-U.S. Holder of a Note if such holder has
provided the required certification that it is not a United States person as set
forth in clause (iii) in the first paragraph under "Non-U.S. Holders" above, or
has otherwise established an exemption (provided that neither the Company nor
its agent has actual knowledge that the holder is a United States person or that
the conditions of any exemption are not in fact satisfied).
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Payment of the proceeds from the sale of a Note to or through a foreign
office of a broker will not be subject to information reporting or backup
withholding, except that if the broker is a United States person, a controlled
foreign corporation for United States tax purposes or a foreign person 50
percent or more of whose gross income from all sources for the three-year period
ending with the close of its taxable year preceding the payment was effectively
connected with a U.S. trade or business, information reporting may apply to such
payments. Payment of the proceeds from a sale of a Note to or through the U.S.
office of a broker is subject to information reporting and backup withholding
unless the holder or beneficial owner certifies as to its taxpayer
identification number or otherwise establishes an exemption from information
reporting and backup withholding.
PLAN OF DISTRIBUTION
The Notes are being offered on a continuing basis by the Company through
each of Lehman Brothers, Lehman Brothers Inc. and Goldman, Sachs & Co., as an
agent (each an "Agent" and collectively the "Agents"), each of which has agreed
to use its reasonable best efforts to solicit offers to purchase the Notes. The
Company will pay each Agent a commission, in the form of a discount, ranging
from .125% to .750% of the principal amount of each Note, depending upon the
time until its Maturity Date, sold through such Agent. The Company may use
additional agents to solicit offers to purchase Notes as the Company may
designate from time to time on terms substantially identical to those set forth
above. Such other agents, if any, will be named in the applicable Pricing
Supplement. The Company also may sell Notes to any Agent, acting as principal,
at a discount to be agreed upon at the time of sale, for resale to one or more
investors or to one or more broker-dealers (acting as principal for purposes of
resale) at varying prices related to prevailing market prices at the time of
resale, as determined by such Agent, or, if so agreed, at a fixed public
offering price. The Notes may also be sold by the Company directly to
purchasers. No commission will be payable to the Agents on Notes sold directly
to purchasers by the Company.
The Company will have the sole right to accept offers to purchase Notes and
may reject any proposed purchase of Notes in whole or in part whether placed
directly with the Company or through an Agent. Each Agent will have the right,
in its discretion reasonably exercised, to reject any offer to purchase Notes
received by it in whole or in part.
Payment of the purchase price of the Notes will be required to be made in
funds immediately available in The City of New York.
The Agents may be deemed to be "underwriters" within the meaning of the
Securities Act of 1933, as amended (the "Act"). The Company has agreed to
indemnify each Agent against certain liabilities, including liabilities under
the Act. The Company has agreed to reimburse the Agents for certain expenses,
including fees and disbursements of counsel to the Agents. The Agents may sell
to or through dealers who may resell to investors. The Agents may pay all or
part of their commission to such dealers. Such dealers may be deemed to be
"underwriters" within the meaning of the Act.
No Note will have an established trading market when issued. The Notes will
not be listed on any securities exchange. The Company has been advised by each
of the Agents that it may from time to time purchase and sell Notes in the
secondary market, but that it is not obligated to do so. No assurance can be
given that there will be a secondary market for the Notes.
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<PAGE> 30
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.
SUBJECT TO COMPLETION, DATED APRIL 12, 1996
PROSPECTUS
AIR PRODUCTS AND CHEMICALS, INC.
DEBT SECURITIES
Air Products and Chemicals, Inc. (the "Company"), directly, through agents
designated from time to time, or through dealers or underwriters also to be
designated, may sell from time to time after the date of this Prospectus up to
$500,000,000 aggregate principal amount or the equivalent thereof in other
currencies or currency units of its debt securities (the "Securities"), in one
or more series, on terms to be determined at the time of sale. The specific
designation, aggregate principal amount, authorized denominations, currency,
maturity, interest rate or method for its calculation, if any, interest payment
dates, purchase price, any terms for redemption, repayment or defeasance or
other specific terms, any listing on a securities exchange, sinking fund
provisions, if any, and the agents, dealers or underwriters, if any, in
connection with the sale of the Securities in respect of which this Prospectus
is being delivered are set forth in the accompanying Prospectus Supplement
("Prospectus Supplement"), and Pricing Supplement ("Pricing Supplement"), if
any, together with the terms of offering of the Securities. The Company reserves
the sole right to accept and, together with its agents from time to time, to
reject in whole or in part any proposed purchase of Securities to be made
directly or through agents.
------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------
If an agent of the Company or a dealer or underwriter is involved in the
sale of the Securities in respect of which this Prospectus is being delivered,
the agent's commission, dealer's purchase price or underwriter's discount is set
forth in, or may be calculated from, the Prospectus Supplement and the net
proceeds to the Company from such sale will be the purchase price of such
Securities less such commission in the case of an agent, the purchase price of
such Securities in the case of a dealer or the public offering price less such
discount in the case of an underwriter, and less, in each case, the other
attributable issuance and distribution expenses. The aggregate proceeds to the
Company from all the Securities will be the purchase price of Securities sold
less the aggregate of agents' commissions and underwriters' discounts and other
expenses of issuance and distribution. See "Plan of Distribution" for possible
indemnification arrangements for the agents, dealers and underwriters.
April , 1996
<PAGE> 31
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 and in accordance therewith files reports, proxy statements
and other information with the Securities and Exchange Commission (the
"Commission"). Such reports, proxy statements and other information, including
the documents incorporated herein by reference, can be inspected and copied at
the office of the Commission at Room 1024 (Public Reference Room), 450 Fifth
Street, N.W., Washington, D.C. 20549, as well as at the Regional Offices of the
Commission at Northwestern Atrium Center, 500 West Madison Street (Suite 1400),
Chicago, Illinois 60661 and 7 World Trade Center, 13th Floor, New York, New York
10048. Copies of such material can be obtained by mail from the Public Reference
Room of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at
prescribed rates. In addition, such reports, proxy statements and other
information concerning the Company can be inspected at the offices of the New
York Stock Exchange, Inc., 20 Broad Street, New York, New York, and the Pacific
Stock Exchange, 115 Sansome Street, San Francisco, California.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company hereby incorporates by reference in this Prospectus the
following document:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
September 30, 1995, filed pursuant to Section 13 of the Securities Exchange Act
of 1934;
(b) The Company's Quarterly Report on Form 10-Q for the quarter ended
December 31, 1995 pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934; and
(c) The Company's Current Report on Form 8-K filed April 11, 1996, filed
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934 subsequent to the date of this
Prospectus and prior to the termination of the offering of the Securities shall
be deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
Any person receiving a copy of this Prospectus may obtain without charge,
upon written or oral request, a copy of any of the documents incorporated by
reference herein, except for the exhibits to such documents. Requests should be
directed to the Corporate Secretary's Office, Air Products and Chemicals, Inc.,
7201 Hamilton Boulevard, Allentown, Pennsylvania 18195-1501, telephone: (610)
481-4911.
THE COMPANY
The Company, through internal development and by acquisitions, has
established an internationally recognized industrial gas and related industrial
process equipment business, and developed strong positions as a producer of
certain chemicals. In addition, the Company has developed an environmental and
energy business principally through various partnerships.
The industrial gases business segment recovers and distributes industrial
gases such as oxygen, nitrogen, argon and hydrogen and a variety of medical and
specialty gases. The chemicals business segment produces and markets specialty
chemicals and chemical intermediates. The environmental and energy business is
principally composed of partnerships in waste-to-energy, power generation and
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<PAGE> 32
flue-gas treatment. The equipment and services business segment supplies
cryogenic and other process equipment and related engineering services.
The Company was incorporated in 1961 under Delaware law and is the
successor to a Michigan corporation organized in 1940. Its principal executive
offices are located at 7201 Hamilton Boulevard, Allentown, Pennsylvania
18195-1501, telephone (610) 481-4911. Except as otherwise indicated by the
context, the term "Company" as used herein means Air Products and Chemicals,
Inc. and its consolidated subsidiaries.
RATIOS OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
(UNAUDITED)
THREE MONTHS
(UNAUDITED) ENDED
YEAR ENDED SEPTEMBER 30, DECEMBER 31,
- ---------------------------------------- ------------
1991 1992 1993 1994 1995 1995
- ---- ---- ---- ---- ---- ------------
<S> <C> <C> <C> <C> <C>
3.2 3.9 3.2 3.4 4.1 3.5
</TABLE>
For the purpose of determining the unaudited ratios of earnings to fixed
charges, earnings represent income (before extraordinary item and cumulative
effect of accounting changes) before income taxes, fixed charges (less interest
capitalized), amortization of capitalized interest and undistributed earnings of
less-than-fifty-percent owned affiliates. Fixed charges consist of interest on
all indebtedness (including capital lease obligations), capitalized interest,
amortization of debt discount premium and expense and the portion of rent
charges under operating leases considered to be representative of the interest
factor.
USE OF PROCEEDS
Net proceeds to the Company are expected to be $496,250,000 - $499,375,000
(prior to deducting expenses payable by the Company estimated at $375,000). The
Company currently intends to apply the net proceeds from the sale of the
Securities to its general funds to be used for general corporate purposes. Such
corporate purposes may include the refunding of maturing debt, including
commercial paper and long-term debt obligations (as described in Note 4 of the
Company's 1995 Consolidated Financial Statements, as incorporated into the
Company's Form 10-K for the fiscal year ended September 30, 1995), the
repurchase of shares of the Company's Common Stock and acquisitions, including
the acquisition of the remaining outstanding shares of a Spanish industrial gas
company, Sociedad Espanola de Carburos Metalicos, S.A., which are tendered under
a tender offer expected to be made in September 1996. Pending such application,
all or a portion of the net proceeds may be invested in short-term money market
instruments. The precise amount and timing of the use of the proceeds will
depend upon future requirements and the availability of other funds to the
Company.
DESCRIPTION OF SECURITIES
The Securities offered hereby will be issuable in one or more series under
an Indenture dated as of January 10, 1995 (the "Indenture"), entered into
between the Company and First Union National Bank (formerly, First Fidelity
Bank, National Association), as Trustee (the "Trustee"). The following
statements are subject to the detailed provisions of the Indenture, a copy of
which is filed as an exhibit to the Registration Statement. Wherever references
are made to particular provisions of the Indenture, such provisions are
incorporated by reference as a part of the statements made and such statements
are qualified in their entirety by such reference. Certain defined terms are
capitalized. Section references in italics are to the Indenture.
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<PAGE> 33
GENERAL
The Indenture provides that the aggregate principal amount of Securities
which may be issued under the Indenture is unlimited. Reference is made to the
Prospectus Supplement and the applicable Pricing Supplement for the following
terms of the Securities in respect of which this Prospectus is being delivered:
(1) the designation, aggregate principal amount and authorized denominations of
such Securities; (2) the percentage of their principal amount at which such
Securities will be issued; (3) the currency or currency unit of payment; (4) the
date on which such Securities will mature; (5) the rate or rates per annum, if
any, at which such Securities will bear interest or the method for calculating
such rate; (6) the times at which such interest, if any, will be payable; (7)
provisions for a sinking fund, if any; (8) whether such Securities are to be
issued in book-entry form, and, if so, the identity of the depositary and
information with respect to book-entry procedures; and (9) any redemption,
repayment or defeasance terms or other specific terms. Principal and interest,
if any, will be payable, and the Securities offered hereby will be transferable
or exchangeable, as provided therein.
The Securities will be unsecured and will rank on a parity with all other
unsecured and unsubordinated indebtedness of the Company.
One or more series of the Securities may be issued as discounted Securities
(bearing no interest or interest at a rate which at the time of issuance is
below market rates) to be sold at a substantial discount below their stated
principal amount. Federal income tax consequences and other special
considerations applicable to any such series of discounted Securities will be
described in the Prospectus Supplement and/or the applicable Pricing Supplement
relating thereto.
Special federal income tax and other considerations relating to Securities
denominated in foreign currencies or units of two or more foreign currencies
will be described in the applicable Prospectus Supplement and/or the applicable
Pricing Supplement.
The Securities offered hereby will be issued only in fully registered form
without coupons. No service charge will be made for any transfer or exchange of
the Securities, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith. (Section
2.8)
CERTAIN COVENANTS OF THE COMPANY
Limitations on Liens -- Subject to the exceptions set forth below under
"Exempted Indebtedness," the Company covenants that it will not create or
assume, nor will it permit any Restricted Subsidiary (as hereinafter defined) to
create or assume, any mortgage, security interest, pledge or lien (collectively
referred to herein as "lien") of or upon any Principal Property (as hereinafter
defined), or any underlying real estate of such property, or shares of capital
stock or indebtedness of any Restricted Subsidiary, whether owned at the date of
the Indenture or thereafter acquired, without equally and ratably securing the
outstanding Securities. This restriction will not apply to certain permitted
liens, including the following: (1) liens on any Principal Property which are
created or assumed contemporaneously with, or within 120 days after (or in the
case of any such Principal Property which is being financed on the basis of
long-term contracts or similar financing arrangements for which a firm
commitment is made by one or more banks, insurance companies or other lenders or
investors (not including the Company or any Restricted Subsidiary), then within
360 days after), the completion of the acquisition, construction or improvement
of such Principal Property to secure or provide for the payment of any part of
the purchase price of such property or the cost of such construction or
improvement, or liens on any Principal Property existing at the time of
acquisition thereof; (2) liens on property or shares of capital stock or
indebtedness of a corporation existing at the time such corporation is merged
into or consolidated with the Company or a Restricted Subsidiary or at the time
of a sale, lease or other disposition of the properties of a corporation
substantially as an entirety to the Company or a Restricted Subsidiary; (3)
liens on property or shares of capital stock or indebtedness of a corporation
existing at the time such corporation becomes a Restricted Subsidiary; (4) liens
to secure indebtedness of a Restricted Subsidiary to the Company or to another
Restricted Subsidiary, but only
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<PAGE> 34
so long as such indebtedness is held by the Company or a Restricted Subsidiary;
(5) liens in favor of the United States of America or any State thereof, or any
department, agency or political subdivision of the United States of America or
any State thereof, to secure certain payments pursuant to any contract or
statute, including liens to secure indebtedness of the pollution control or
industrial revenue bond type, or to secure indebtedness incurred for the purpose
of financing all or any part of the purchase price or cost of constructing or
improving property subject to such liens; (6) liens in favor of any customer
arising in respect of certain payments made by or on behalf of such customer for
goods produced for or services rendered to such customer in the ordinary course
of business not exceeding the amount of such payments; (7) liens to extend,
renew or replace in whole or in part any lien referred to in the foregoing
clauses (1) to (6), or in this clause (7), or any lien created prior to and
existing on the date of the Indenture, provided that the principal amount of
indebtedness secured thereby shall not exceed the principal amount of
indebtedness so secured at the time of such extension, renewal or replacement,
and that such extension, renewal or replacement shall be limited to all or a
part of the property subject to the lien so extended, renewed or replaced (plus
improvements on such property); and (8) certain statutory liens, liens for taxes
and certain other liens. (Section 3.6)
Limitations on Sale and Lease-Back Transactions -- Subject to the
exceptions set forth below under "Exempted Indebtedness," sale and lease-back
transactions by the Company or any Restricted Subsidiary of any Principal
Property which has been owned and operated by the Company or a Restricted
Subsidiary for more than 120 days are prohibited unless (1) the property
involved is property which could be the subject of a lien without equally and
ratably securing the Securities; (2) an amount equal to the Attributable Debt
(as hereinafter defined) of any such sale and lease-back transaction is applied
to the acquisition of another Principal Property of equal or greater fair market
value or to retirement of indebtedness for borrowed money (including the
Securities) which by its terms matures on or is renewable at the option of the
obligor to a date more than twelve months after the creation of such
indebtedness; or (3) the lease involved is for a term (including renewals) of
not more than three years. (Section 3.7)
Exempted Indebtedness -- The Company or a Restricted Subsidiary may create
or assume liens and enter into sale and lease-back transactions, notwithstanding
the limitations outlined above, provided that at the time thereof and after
giving effect thereto the aggregate amount of indebtedness secured by all such
liens and Attributable Debt of all such sale and lease-back transactions
outstanding shall not exceed 5% of Consolidated Net Tangible Assets (as
hereinafter defined). (Section 3.8)
Limitations on Mergers, Consolidations and Sales of Assets -- If, upon any
consolidation or merger of the Company with or into any other corporation, or
upon any sale, conveyance or lease of substantially all its properties, any
Principal Property would thereupon become subject to any lien, the Company,
prior to such event, will secure the Securities equally and ratably with any
other obligations of the Company then entitled thereto by a direct lien on all
such Principal Property prior to all other liens other than any theretofore
existing thereon. (Section 3.9)
Certain Definitions -- The term "Subsidiary" means any corporation of which
at least a majority of all outstanding voting stock is at the time owned by the
Company or by one or more Subsidiaries of the Company. The term "Restricted
Subsidiary" means any Subsidiary (a) substantially all of the property of which
is located, or substantially all of the business of which is carried on, within
the United States and (b) which owns or leases a Principal Property. The term
"Principal Property" means any manufacturing plant, research facility or
warehouse owned or leased by the Company or any Subsidiary which is located
within the United States and has a net book value exceeding the greater of
$5,000,000 and 1% of shareholders' equity of the Company and its consolidated
Subsidiaries, excluding any property which the Board of Directors by resolution
declares is not of material importance to the total business of the Company and
its Subsidiaries as an entirety. The term "Attributable Debt" means the present
value (discounted as provided in the Indenture) of the obligation of a lessee
for required rental payments for the remaining term of any lease. The term
"Consolidated Net Tangible Assets" means at any time the total of all assets
appearing on the most recent consolidated balance sheet of the Company and its
consolidated Subsidiaries, prepared in accordance with generally accepted
accounting principles, at their net book values (after deducting related
depreciation, depletion, amortization
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<PAGE> 35
and all other valuation reserves which, in accordance with such principles, are
set aside in connection with the business conducted), but excluding goodwill,
trademarks, patents, unamortized debt discount and all other like segregated
intangible assets, and amounts on the asset side of such balance sheet for
capital stock of the Company, all as determined in accordance with such
principles, less Consolidated Current Liabilities. The term "Consolidated
Current Liabilities" means the aggregate of the current liabilities of the
Company and its consolidated Subsidiaries appearing on the consolidated balance
sheet of the Company and its consolidated Subsidiaries, all as determined in
accordance with generally accepted accounting principles. (Section 1.1)
EVENTS OF DEFAULT, WAIVER AND NOTICE
As to any series of Securities, an Event of Default is defined in the
Indenture as being any one of the following events and such events as may be
established with respect to the Securities of such series in any applicable
Pricing Supplement: (a) default for 30 days in the payment of any interest on
the Securities of such series; (b) default in the payment of principal and
premium, if any, on the Securities of such series when due either at maturity,
upon redemption, by declaration or otherwise; (c) default in the payment of any
sinking fund installment on the Securities of such series; (d) default by the
Company in the performance of any other of the covenants or agreements in the
Indenture (other than those set forth exclusively in the terms of any series of
Securities) which shall not have been remedied for a period of 90 days after
appropriate notice, as specified in the Indenture; or (e) certain events of
bankruptcy, insolvency and reorganization of the Company. (Section 5.1) No Event
of Default with respect to any particular series of Securities necessarily
constitutes an Event of Default with respect to any other series of Securities.
The Indenture provides that the Trustee may withhold notice to the holders of
Securities of any series of any default (except in payment of principal of or
interest on such Securities or in the making of any sinking fund payment with
respect to such Securities) if the Trustee considers it in the interest of the
holders of Securities of such series to do so. (Section 5.11)
The Indenture provides that: (1) if an Event of Default described in clause
(a), (b) or (c) above or established with respect to the Securities of any
series shall have occurred and be continuing, either the Trustee or the holders
of 25% in aggregate principal amount of the Securities of such series then
outstanding may declare the principal (or, in the case of discounted Securities,
the amount specified in the terms thereof) of all such Securities to be due and
payable immediately and (2) if an Event of Default described in clause (d) or
(e) above shall have occurred and be continuing, either the Trustee or the
holders of not less than 25% in aggregate principal amount of all Securities
then outstanding may declare the principal (or, in the case of discounted
Securities, the amount specified in the terms thereof) of all Securities to be
due and payable immediately, but upon certain conditions such declarations may
be annulled and past defaults (except for defaults in the payment of principal
of, or premium or interest, if any, on, such Securities) may be waived by the
holders of a majority in aggregate principal amount of the Securities of such
series (or of all series as the case may be) then outstanding. (Section 5.1 and
Section 5.10)
The holders of a majority in aggregate principal amount of the Securities
of each series affected (with each series voting as a separate class) and then
outstanding shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee under the
Indenture, subject to certain limitations specified in the Indenture, provided
that the holders of Securities shall have offered to the Trustee reasonable
indemnity against costs, expenses and liabilities. (Section 5.9 and Section
6.2(d)) The Indenture requires the annual filing by the Company with the Trustee
of a certificate as to the absence of certain defaults under the Indenture.
(Section 3.5)
Other than the restrictions on liens and sale and lease-back transactions
described above, the Indenture and the Securities do not contain any covenants
or other provisions designed to afford holders of the Securities protection in
the event of a highly leveraged transaction involving the Company or any
Subsidiary, including without limitation any takeover, recapitalization or other
restructuring that may result in a sudden and significant decline in credit
rating.
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<PAGE> 36
MODIFICATION OF THE INDENTURE
The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the holders of not less than 66 2/3% in aggregate principal
amount of the Securities of all series affected by such modification at the time
outstanding (voting as one class), to modify the Indenture or any supplemental
indenture or the rights of the holders of the Securities, provided that no such
modification shall (i) extend the final maturity of any Security, or reduce the
principal amount thereof, or reduce the rate or extend the time of payment of
interest thereon, or reduce any amount payable upon redemption thereof, or
reduce the amount of the principal of a discounted Security due and payable upon
acceleration of the maturity thereof or provable in bankruptcy, or impair or
affect the right of a holder to institute suit for the payment thereof or the
right of repayment, if any, at the option of the holder thereof, without the
consent of the holder of each Security so affected, or (ii) reduce the aforesaid
percentage of Securities of any series, the consent of the holders of which is
required for any such modification, without the consent of the holder of each
Security so affected. (Section 8.2)
GLOBAL SECURITIES
The Securities of a series may be issued in the form of a global security
which is deposited with and registered in the name of the depositary (or a
nominee of the depositary) specified in the accompanying Prospectus Supplement.
So long as the depositary for a global security, or its nominee, is the
registered owner of the global security, the depositary or its nominee, as the
case may be, will be considered the sole owner or holder of the Securities
represented by such global security for all purposes under the Indenture. Except
as provided in the Indenture, owners of beneficial interests in Securities
represented by a global security will not (a) be entitled to have such
Securities registered in their names, (b) receive or be entitled to receive
physical delivery of certificates representing such Securities in definitive
form, (c) be considered the owners or holders thereof under the Indenture and
(d) have any rights under the Indenture with respect to such global security
(Section 2.14). The Company, in its sole discretion, may at any time determine
that any series of Securities issued or issuable in the form of a global
security shall no longer be represented by such global security and such global
security shall be exchanged for securities in definitive form pursuant to the
Indenture. (Section 2.14)
Upon the issuance of a global security, the depositary will credit, on its
book-entry registration and transfer system, the respective principal amounts of
such global security to the accounts of participants in the depositary.
Ownership of beneficial interests in a global security will be shown on, and the
transfer of that ownership will be effected only through, records maintained by
the depositary (with respect to interests of participants in the depositary), or
by participants in the depositary or persons that may hold interests through
such participants (with respect to persons other than participants in the
depositary). Ownership of beneficial interests in a global security will be
limited to participants or persons that hold interests through participants.
CONCERNING THE TRUSTEE
First Union National Bank (formerly, First Fidelity Bank, National
Association), the Trustee under the Indenture, also performs certain cash
management services for the Company in the normal course of business.
DEFEASANCE OF THE INDENTURE AND SECURITIES
The Company at any time may satisfy its obligations with respect to
payments of principal of, premium, if any, and interest, if any, on, any
Security or Securities of any series by depositing in trust with the Trustee (a)
money (in such currency in which such securities are payable) or (b), in the
case of Securities denominated in U.S. dollars, U.S. Government Obligations (as
defined in the Indenture) or, in the case of Securities denominated in a foreign
currency, Foreign Government Securities (as defined in the Indenture) or a
combination of (a) and (b) sufficient to make such payments when due.
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<PAGE> 37
If such deposit is sufficient to make all payments of (1) interest, if any, on
such Securities prior to and on their redemption or maturity, as the case may
be, and (2) principal of, and premium, if any, on such Securities when due upon
redemption or at maturity, as the case may be, all the obligations of the
Company with respect to such Securities and the Indenture insofar as it relates
to such Securities will be discharged and terminated (except as to the Company's
obligations to compensate, reimburse and indemnify the Trustee pursuant to the
Indenture). In the event of any such defeasance, holders of such Securities
would be able to look only to such trust fund for payment of principal and
premium, if any, and interest, if any, on Securities of such series until
maturity or redemption. (Article Ten)
For federal income tax purposes, there is a substantial risk that any
deposit of cash and/or U.S. Government Obligations or Foreign Government
Securities with respect to which the Company shall have elected to satisfy and
fully discharge its obligations with respect to any series of Securities could
be treated as a taxable exchange of such Securities for interests in the trust
(or, alternatively, for an instrument representing indebtedness of the trust).
In that event, a holder could be required to recognize taxable gain or loss at
the time of such defeasance as if the Securities had been sold for an amount
equal to the sum of the amount of money and the fair market value of the U.S.
Government Obligations or Foreign Government Securities held in the defeasance
trust (or, alternatively, the value of the instrument). Thereafter, a holder
might be required to include in income the holder's share of the income, gain
and loss of the trust (or, alternatively, the trust might be considered a
separate taxable entity with respect to such items and with respect to the debt
instrument, in which case a holder might also be taxable on original issue
discount as well as interest on the instrument). Purchasers of the Securities
should consult their own advisors with respect to the more detailed tax
consequences to them of such deposit and discharge, including the applicability
and effect of tax laws other than federal income tax law.
PLAN OF DISTRIBUTION
The Company may sell the Securities in any of four ways: (i) directly to
purchasers; (ii) through agents; (iii) through underwriters; or (iv) through
dealers.
Offers to purchase Securities may be solicited directly by the Company or
by agents designated by the Company from time to time. Any such agent, who may
be deemed to be an underwriter as that term is defined in the Securities Act of
1933, involved in the offer or sale of the Securities in respect of which this
Prospectus is delivered will be named, and any commissions payable by the
Company to such agent will be set forth, in the Prospectus Supplement. Unless
otherwise indicated in the Prospectus Supplement, any such agent will be acting
on a best efforts basis for the period of its appointment. Agents may be
customers of, engage in transactions with or perform services for the Company in
the ordinary course of business.
If an underwriter or underwriters are utilized in the sale, the Company
will enter into an underwriting, purchase or agency agreement with such
underwriters at the time of sale to them and the names of the underwriters and
the terms of the transaction will be set forth in the Prospectus Supplement,
which will be used by the underwriters to make resales of the Securities in
respect of which this Prospectus is delivered to the public.
If a dealer is utilized in the sale of the Securities in respect of which
this Prospectus is delivered, the Company will sell such Securities to such
dealer, as principal. The dealer may then resell such Securities to the public
at varying prices to be determined by such dealer at the time of resale.
Agents, underwriters and dealers may be entitled under the relevant
agreements to indemnification by the Company against certain liabilities,
including liabilities under the Securities Act of 1933.
If so indicated in the Prospectus Supplement, the Company will authorize
agents or underwriters to solicit offers by certain institutions to purchase
Securities from the Company at the public offering price set forth in the
Prospectus Supplement pursuant to Delayed Delivery Contracts ("Contracts")
providing for payment and delivery on the date stated in the Prospectus
Supplement. Each Contract
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<PAGE> 38
will be for an amount not less than, and unless the Company otherwise agrees the
aggregate principal amount of Securities sold pursuant to Contracts shall be not
more than, the respective amounts stated in the Prospectus Supplement.
Institutions with which Contracts, when authorized, may be made include
commercial and savings banks, insurance companies, pension funds, investment
companies, educational and charitable institutions and other institutions but
shall in all cases be subject to the approval of the Company. Contracts will not
be subject to any conditions except that the purchase by an institution of the
Securities covered by its Contract shall not at the time of delivery be
prohibited under the laws of any jurisdiction in the United States to which such
institution is subject. A commission indicated in the Prospectus Supplement will
be paid to underwriters or agents soliciting purchases of Securities pursuant to
Contracts accepted by the Company.
The place and time of delivery for the Securities in respect of which this
Prospectus is delivered will be set forth in the Prospectus Supplement.
LEGAL OPINIONS
The legality of the Securities in respect of which this Prospectus is being
delivered will be passed on for the Company by James H. Agger, Esq., Vice
President, General Counsel and Secretary of the Company, or Robert F. Gerkens,
Esq., Assistant General Counsel of the Company, and for the underwriters, if
any, by Cravath, Swaine & Moore, Worldwide Plaza, 825 Eighth Avenue, New York,
New York 10019. The tax disclosure set forth under "U.S. Federal Income Tax
Considerations" on pages S-20 through S-28 of the Prospectus Supplement has been
passed on for the Company by Cornelius P. Powell, Esq., Vice President -- Taxes
of the Company. Messrs. Agger, Gerkens and Powell, in their capacities
indicated, are paid salaries by the Company, they are participants in various
employee benefit plans offered to employees of the Company generally and each
owns shares of common stock of the Company and participates in the Company's
long-term incentive program, which entitles executives to stock options and
deferred stock units. Cravath, Swaine & Moore from time to time acts as special
counsel for the Company.
EXPERTS
The financial statements and schedule for the year ended 30 September 1995
incorporated by reference in this Prospectus and elsewhere in the Registration
Statement, have been audited by Arthur Andersen LLP, independent public
accountants, as indicated in their reports with respect thereto, and
are incorporated herein by reference in reliance upon the authority of said firm
as experts in accounting and auditing in giving said reports.
9
<PAGE> 39
- ------------------------------------------------------
------------------------------------------------------
- ------------------------------------------------------
------------------------------------------------------
NO DEALER, SALESMAN, OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS SUPPLEMENT, THE ACCOMPANYING PROSPECTUS OR ANY PRICING SUPPLEMENT IN
CONNECTION WITH THE OFFER CONTAINED IN THIS PROSPECTUS SUPPLEMENT, THE
ACCOMPANYING PROSPECTUS OR ANY PRICING SUPPLEMENT, AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY OR BY ANY AGENT, DEALER OR UNDERWRITER. NEITHER THIS PROSPECTUS
SUPPLEMENT, NOR THE ACCOMPANYING PROSPECTUS NOR ANY PRICING SUPPLEMENT SHALL
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE
SECURITIES OFFERED HEREBY IN ANY STATE TO ANY PERSON TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION IN SUCH STATE. THE DELIVERY OF THIS PROSPECTUS
SUPPLEMENT, THE ACCOMPANYING PROSPECTUS OR ANY PRICING SUPPLEMENT AT ANY TIME
DOES NOT IMPLY THAT THE INFORMATION HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT
TO THE DATE HEREOF.
------------------------
TABLE OF CONTENTS
PAGE
Prospectus Supplement
<TABLE>
<S> <C>
Risk Factors................................ S-2
Description of Notes........................ S-4
Special Provisions Relating to
Multi-Currency Notes...................... S-17
U.S. Federal Income Tax Considerations...... S-20
Plan of Distribution........................ S-28
Prospectus
Available Information....................... 2
Incorporation of Certain Documents by
Reference................................. 2
The Company................................. 2
Ratios of Earnings to Fixed Charges......... 3
Use of Proceeds............................. 3
Description of Securities................... 3
Plan of Distribution........................ 8
Legal Opinions.............................. 9
Experts..................................... 9
</TABLE>
$500,000,000
LOGO
MEDIUM-TERM NOTES,
SERIES F
DUE FROM 9 MONTHS TO 30 YEARS
FROM DATE OF ISSUE
------------------------------------------------------
PROSPECTUS
1996
AND
PROSPECTUS SUPPLEMENT
1996
------------------------------------------------------
LEHMAN BROTHERS
GOLDMAN, SACHS & CO.
- ------------------------------------------------------
------------------------------------------------------
- ------------------------------------------------------
------------------------------------------------------
<PAGE> 40
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<S> <C>
Registration Fee.................................................. $172,415
Printing Fees..................................................... 30,000*
Legal Fees........................................................ 40,000*
Accountants' Fees................................................. 25,000*
Rating Agency Fees................................................ 50,000*
Fees and Expenses of Trustee...................................... 30,000*
Blue Sky Fees and Expenses........................................ 5,000*
Miscellaneous..................................................... 22,585
--------
Total................................................... $375,000
========
</TABLE>
- ---------------
* Estimated.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware Corporation Law gives corporations the power to
indemnify officers and directors under certain circumstances.
Article Ninth of the Company's Restated Certificate of Incorporation
contains provisions which provide for indemnification of certain persons
(including officers and directors). The Restated Certificate of Incorporation is
filed as an exhibit to the Company's Annual Report on Form 10-K for the fiscal
year ended September 30, 1987.
The Company maintains insurance that generally insures the officers and
directors of the Company and its subsidiaries (as defined in said policy)
against liabilities incurred in such capacities, and insures the Company with
respect to amounts to which officers and directors become entitled as
indemnification payments from the Company, subject to certain specified
exclusions and deductible and maximum amounts. The Company also maintains a
policy of insurance that insures, among others, certain officers and directors
of the Company and certain of its subsidiaries against liabilities incurred for
Breach of Fiduciary Duty (as defined in said policy) with respect to their
performance of their duties and responsibilities in connection with certain
pension and retirement plans of the Company and certain of its subsidiaries,
subject to certain specified exclusions and deductible and maximum amounts.
ITEM 16. EXHIBITS.
The following Exhibits are filed as part of this Registration Statement:
<TABLE>
<S> <C>
Exhibit 1 -- Form of Agency Agreement for Medium-Term Notes, Series F.
Exhibit 4(a) -- Indenture dated as of January 10, 1995, between the Company and
First Union National Bank (formerly, First Fidelity Bank, National
Association), as Trustee, relating to the Securities (filed as
Exhibit 4(a) to the Company's Registration Statement No. 33-57357).
(b) -- Form of Fixed Rate Medium-Term Note, Series F.
(c) -- Form of Floating Rate Medium-Term Note, Series F.
(d) -- Form of Fixed Rate Currency Indexed Medium-Term Note, Series F.
(e) -- Form of S&P 500 Linked Medium-Term Note, Series F.
Exhibit 5 -- Opinion of Company counsel as to legality of the Securities to be
issued.
Exhibit 12 -- Computation of Ratios of Earnings to Fixed Charges (filed as
Exhibit (a)(12) to the Company's Quarterly Report on Form 10-Q for
the quarter ended December 31, 1995, and incorporated herein by
reference).
Exhibit 23(a) -- Consent of Arthur Andersen LLP. (See page II-6).
(b) -- Consent of Company counsel.
</TABLE>
II-1
<PAGE> 41
<TABLE>
<S> <C>
Exhibit 24 -- Power of Attorney.
Exhibit 25 -- Form T-1 Statement of Eligibility and Qualification under the
Trust Indenture Act of 1939 of First Union National Bank, as Trustee.
</TABLE>
ITEM 17. UNDERTAKINGS.
THE UNDERSIGNED REGISTRANT HEREBY UNDERTAKES:
(1) To file, during any period in which offers or sales are being made of
the securities registered hereby, a post-effective amendment to this
registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of this registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this registration statement or any
material change to such information in this registration statement;
provided, however, that the undertakings set forth in paragraphs (i) and (ii)
above do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic reports
filed with or furnished to the Commission by the registrant pursuant to section
13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in this registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned registrant hereby further undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the provisions set forth or described in Item 15 of this
registration statement, or otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
II-2
<PAGE> 42
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of a registration statement in reliance upon Rule 430A and contained in the
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or
(4) or 497(h) under the Securities Act of 1933 shall be deemed to be part
of the registration statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-3
<PAGE> 43
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Allentown and Commonwealth of Pennsylvania on the
12th day of April, 1996.
AIR PRODUCTS AND CHEMICALS, INC.
(Issuer)
By /s/ A. H. KAPLAN
------------------------------------
(A. H. Kaplan, Vice
President -- Finance)
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities indicated on April 12, 1996.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- -----------------------------------------------
<C> <S> <C>
/s/ HAROLD A. WAGNER Director and Chairman of
- ----------------------------------------------- the Board (Principal
(Harold A. Wagner) Executive Officer)
/s/ A. H. KAPLAN Vice President -- Finance
- ----------------------------------------------- (Principal Financial Officer)
(A. H. Kaplan)
/s/ PAUL E. HUCK Corporate Controller
- ----------------------------------------------- (Principal Accounting Officer)
(Paul E. Huck)
* Director
- -----------------------------------------------
(Dexter F. Baker)
* Director
- -----------------------------------------------
(Tom H. Barrett)
* Director
- -----------------------------------------------
(L. Paul Bremer, III)
* Director
- -----------------------------------------------
(Robert Cizik)
* Director
- -----------------------------------------------
(Ruth M. Davis)
* Director
- -----------------------------------------------
(Terry R. Lautenbach)
</TABLE>
II-4
<PAGE> 44
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C> <C>
* Director
- -----------------------------------------------
(Rudolphus F. N. Lubbers)
* Director
- -----------------------------------------------
(Judith Rodin)
* Director
- -----------------------------------------------
(Takeo Shiina)
* Director
- -----------------------------------------------
(Lawrason D. Thomas)
</TABLE>
* Arnold H. Kaplan, Vice President -- Finance, by signing his name hereto, does
sign this document on behalf of the above-noted individuals pursuant to a
power of attorney duly executed by such individuals, which power of attorney
is filed with the Securities and Exchange Commission as Exhibit 24 hereto.
/s/ ARNOLD H. KAPLAN
-------------------------------------
(Arnold H. Kaplan, Attorney-in-Fact)
II-5
<PAGE> 45
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
To: Air Products and Chemicals, Inc.:
As independent public accountants, we hereby consent to the incorporation
by reference in this Registration Statement of our reports dated 2 November 1995
included and incorporated by reference in Air Products and Chemicals, Inc.'s
Form 10-K for the year ended 30 September 1995 and to all references to our Firm
included in this Registration Statement.
ARTHUR ANDERSEN LLP
Philadelphia, Pennsylvania
11 April 1996
II-6
<PAGE> 46
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER EXHIBIT PAGE
--------------- ------------------------------------------------------------ ------------
<S> <C> <C>
Exhibit 1 -- Form of Agency Agreement for Medium-Term Notes, Series F.
Exhibit 4(a) -- Indenture dated as of January 10, 1995, between the
Company and First Union National Bank (formerly, First
Fidelity Bank, National Association), as Trustee, relating
to the Securities (Filed as Exhibit 4(a) to the Company's
Registration Statement No. 33-57357).
(b) -- Form of Fixed Rate Medium-Term Note, Series F.
(c) -- Form of Floating Rate Medium-Term Note, Series F.
(d) -- Form of Fixed Rate Currency Indexed Medium-Term Note,
Series F.
(e) -- Form of S&P 500 Linked Medium-Term Note, Series F.
Exhibit 5 -- Opinion of Company counsel as to legality of the
Securities to be issued.
Exhibit 12 -- Computation of Ratios of Earnings to Fixed Charges (filed
as Exhibit (a)(12) to the Company's Quarterly Report on Form
10-Q for the quarter ended December 31, 1995, and
incorporated herein by reference).
Exhibit 23(a) -- Consent of Arthur Andersen LLP. (See page II-6).
(b) -- Consent of Company counsel.
Exhibit 24 -- Power of Attorney.
Exhibit 25 -- Form T-1 Statement of Eligibility and Qualification under
the Trust Indenture Act of 1939 of First Union National Bank
as Trustee.
</TABLE>
<PAGE> 1
U.S. $500,000,000 1/
Air Products and Chemicals, Inc.
Medium-Term Notes, Series F
AGENCY AGREEMENT
[ ], 1996
Lehman Brothers
Lehman Brothers Inc.
3 World Financial Center
New York, New York 10285-1200
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Dear Ladies and Gentlemen:
Air Products and Chemicals, Inc., a Delaware corporation (the
"Corporation"), confirms its agreement with each of you with respect to the
issue and sale by the Corporation of up to $500,000,000 1/ aggregate principal
amount of its Medium-Term Notes, Series F, Due from 9 Months to 30 Years from
Date of Issue (the "Notes"). The Notes are to be issued from time to time
pursuant to an indenture, dated as of January 10, 1995 (as it may be
supplemented or amended from time to time, the "Indenture"), between the
Corporation and First Union National Bank (formerly First Fidelity Bank,
National Association), as trustee (the "Trustee").
The Notes will be issued, and the terms thereof established,
in accordance with the Indenture and the Medium-Term Notes, Series F,
Administrative Procedures attached hereto as Exhibit B (the "Procedures")
(unless a Terms Agreement (as defined in Section 2(b)) modifies or otherwise
supersedes such Procedures with respect to the Notes issued pursuant to such
Terms Agreement). For the
- --------------------
1/ Or its equivalent in foreign currencies or currency units.
<PAGE> 2
2
purposes of this Agreement, the term "Agent" shall refer to any of you acting
solely in the capacity as agent for the Corporation pursuant to Section 2(a)
and not as principal (collectively, the "Agents"), the term "Purchaser" shall
refer to one of you acting solely as principal pursuant to Section 2(b) and not
as agent, and the term "you" shall refer to you collectively whether at any
time any of you is acting in both such capacities or in either such capacity.
In acting under this Agreement, in whatever capacity, each of you is acting
individually and not jointly.
SECTION 1. Representations and Warranties. The Corporation
represents and warrants to each of you as of the Closing Date referred to in
Section 2(a)(viii), and as of the times referred to in Section 9(a) at which the
Corporation accepts offers to purchase Notes and delivers Notes so purchased
(each such time being hereinafter sometimes referred to as a "Representation
Date"), as follows:
(a) Registration Statement and Prospectus. The Corporation
has filed with the Securities and Exchange Commission (the
"Commission"), pursuant to the Securities Act of 1933, as amended (the
"Securities Act"), and the published rules and regulations adopted by
the Commission thereunder (the "Rules"), a registration statement on
Form S-3 (No. 33-[ ]) (the "Registration Statement"), including a
basic prospectus, which has become effective under the Securities Act,
for the registration under the Securities Act of $500,000,000 aggregate
principal amount of debt securities (the "Securities"), including the
Notes. The Registration Statement meets the requirements set forth in
Rule 415(a)(1) under the Securities Act and complies in all other
material respects with said Rule. The Corporation has included in the
Registration Statement a supplement to the form of prospectus included
in the Registration Statement relating to the Notes and the plan of
distribution thereof (as amended or supplemented from time to time, the
"Prospectus Supplement"). In connection with the sale of the Notes,
the Corporation proposes to file with the Commission pursuant to the
applicable paragraph of Rule 424(b) under the Securities Act further
supplements to the Prospectus Supplement specifying the interest rates,
maturity dates, redemption provisions and other similar terms of the
Notes sold pursuant hereto or the offering thereof.
<PAGE> 3
3
"Basic Prospectus" shall mean the form of basic prospectus relating to
the Securities contained in the Registration Statement. The term
"Prospectus" means the Basic Prospectus as supplemented by the
Prospectus Supplement. Any reference herein to the Registration
Statement, the Basic Prospectus, the Prospectus Supplement or the
Prospectus includes the documents incorporated by reference therein
pursuant to Item 12 of Form S-3 which were filed under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), on or before the
date hereof or the issue date of the Prospectus Supplement or the
Prospectus, as the case may be, and any reference herein to "amend",
"amendment" or "supplement" with respect to the Registration Statement,
the Basic Prospectus, the Prospectus Supplement or the Prospectus
includes the filing of any document under the Exchange Act after the
date hereof or the issue date of the Prospectus Supplement or the
Prospectus, as the case may be, and deemed to be incorporated therein
by reference.
(b) Accuracy of Registration Statement. The Registration
Statement, as amended, as of each Representation Date, complies in all
material respects with the provisions of the Securities Act and the
Rules and does not contain any untrue statement of a material fact and
does not omit to state any material fact required to be stated therein
or necessary to make the statements therein not misleading; and the
Prospectus, as supplemented as of any such time, complies in all
material respects with the provisions of the Securities Act and the
Rules and does not contain any untrue statement of a material fact and
does not omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading;
provided, however, that the Prospectus as supplemented at the Closing
Date may not include the information contemplated by Section l(a) to
be contained in pricing supplements thereto; provided, further,
however, that none of the representations and warranties contained in
this Section 1(b) shall apply to (i) that part of the Registration
Statement which shall constitute the Statement of Eligibility and
Qualification (Form T-1) under the Trust Indenture Act of 1939, as
amended (the "Trust Indenture Act"), of the Trustee or (ii) statements
in, or omissions from, the Registration Statement or the Prospectus or
any
<PAGE> 4
4
amendment thereof or supplement thereto made in reliance upon and in
conformity with information furnished in writing to the Corporation by
or on behalf of you for use in connection with the preparation of the
Registration Statement or the Prospectus or any such amendment or
supplement.
(c) Accountants. The accountants whose reports with respect
to financial statements are included in the Registration Statement and
the Prospectus are independent with respect to the Corporation and its
subsidiaries as required by the Securities Act and the Rules.
(d) Material Changes. Since the respective dates as of which
information is given in the Registration Statement and the Prospectus,
as amended or supplemented as of such Representation Date, and except
as set forth therein, there has not been any material adverse
development or change in the condition, financial or other, or the
results of operations of the Corporation and its consolidated
subsidiaries taken as a whole, whether or not arising from
transactions in the ordinary course of business.
(e) Litigation. Except as set forth in the Registration
Statement and the Prospectus, as amended or supplemented as of such
Representation Date, neither the Corporation nor any of its
subsidiaries has any litigation or governmental proceeding pending of
a character which will result in a judgment, decree or order having a
material adverse effect on the condition, financial or other, or the
results of operations of the Corporation and its consolidated
subsidiaries, taken as a whole.
(f) Valid Incorporation; Subsidiaries. The Corporation and
each subsidiary of the Corporation has been duly incorporated and is a
validly existing corporation in good standing under the laws of the
jurisdiction in which it was incorporated, has the corporate power to
own or hold under lease the property it purports to own or hold under
lease and to carry on the business in which it is engaged, and is duly
licensed and duly qualified and is in good standing as a foreign
corporation in each jurisdiction wherein the character of the property
owned or held under lease by it, or the nature of the business
transacted by it,
<PAGE> 5
5
makes such licensing or qualification necessary; and all the
outstanding shares of the capital stock of the subsidiaries of the
Corporation are owned directly, or indirectly through wholly owned
subsidiaries, by the Corporation, free and clear of any material lien,
pledge or other encumbrance, except for (i) directors' and officers'
qualifying shares and (ii) shares of such stock representing minority
interests reflected in the financial statements of the Corporation and
its consolidated subsidiaries included in the Prospectus.
(g) Legality. At the date when the Prospectus Supplement is
filed with, or mailed for filing to, the Commission pursuant to Rule
424(b) under the Securities Act and at each Representation Date
thereafter, (i) the issuance and delivery of the Notes by the
Corporation pursuant to this Agreement will have been duly and validly
authorized by all necessary corporate action and no authorization,
consent or approval of the stockholders and no further authorization
or approval of the Board of Directors of the Corporation will be
required for the issuance, sale and delivery of the Notes as
contemplated herein; (ii) neither such issuance, sale or delivery of
the Notes nor the consummation of any other of the transactions herein
contemplated will result in a breach by the Corporation of any terms
of, or constitute a default under, any other agreement or undertaking
of the Corporation; and (iii) no authorization, consent or approval
of, or filing or registration with, or exemption by, any government or
public body or authority of the United States or of any State or any
department or subdivision thereof, other than such as may be required
under the securities or blue sky laws of any jurisdiction and other
than registration of the Notes under the Securities Act and
qualification of the Indenture under the Trust Indenture Act, is
required for the validity of the Notes or for the valid offering,
issuance, sale and delivery of the Notes by the Corporation pursuant
to this Agreement or for the execution and delivery by the Corporation
of this Agreement and the Indenture.
(h) No Stop Order. The Commission has not issued any order
preventing or suspending the use of the Prospectus as supplemented as
of such Representation Date.
<PAGE> 6
6
(i) Financial Statements. The financial statements included
in the Registration Statement and the Prospectus, as amended or
supplemented as of such Representation Date, present fairly the
financial condition and results of operations of the entities purported
to be shown thereby, at the dates and for the periods indicated, and
have been, and in the case of financial statements included in any
amendments or supplements as of such Representation Date will be,
prepared, except as stated therein, in conformity with generally
accepted accounting principles applied on a consistent basis throughout
the periods involved.
(j) Timely Filing of Documents. During the twelve calendar
months and any portion of a calendar month immediately preceding the
date of the filing of the Registration Statement with the Commission,
the Corporation has timely filed all documents and amendments to
previously filed documents required to be filed by it pursuant to
Section 12, 13, 14 or 15(d) of the Exchange Act. The documents
incorporated by reference into the Prospectus, as supplemented as of
the applicable Representation Date, have been, and each document
subsequently incorporated by reference therein as of such
Representation Date will be, prepared by the Corporation in conformity
with the requirements of the Exchange Act and the rules and
regulations thereunder and such documents have been, or in the case of
documents subsequently incorporated by reference therein will be as of
the applicable Representation Date, timely filed as required thereby.
Copies of each of the documents incorporated by reference into the
Prospectus, together with satisfactory evidence of the filing thereof
and of the other documents and amendments referred to in the first
sentence of this paragraph, have been, or as of the applicable
Representation Date will be, delivered by the Corporation to each
of you.
(k) Doing Business with Cuba. The Corporation confirms as of
the date hereof, and each acceptance by the Corporation of an offer to
purchase Notes will be deemed to be an affirmation, that the
Corporation is in compliance with all provisions of Section 517.075 of
the Florida Securities and Investor Protection Act relating to
disclosure of business in Cuba, and the Corporation further agrees
that it will continue so to comply in the future.
<PAGE> 7
7
SECTION 2. Appointment of Agents; Solicitation by the Agents
of Offers to Purchase; Sales of Notes to a Purchaser. (a) Subject to the
terms and conditions stated herein, and subject to the reservation by the
Corporation of the right to sell Notes directly on its own behalf, and to sell
Notes to or through such other agents as the Corporation shall appoint from
time to time:
(i) the Corporation hereby appoints the Agents as agents of
the Corporation for the purpose of soliciting or receiving offers to
purchase the Notes from the Corporation by others;
(ii) the Corporation shall notify the Agents of any sale made
to or through other agents on or promptly after the settlement date for
such sale. This Agreement shall apply only to sales of the Notes and
not to sales of any other securities or evidences of indebtedness of
the Corporation and only on the specific terms set forth herein;
(iii) on the basis of the representations and warranties
contained herein, but subject to the terms and conditions herein set
forth, each Agent agrees, as an agent of the Corporation, to use its
reasonable best efforts to solicit offers to purchase the Notes upon
the terms and conditions set forth in the Prospectus, as supplemented
from time to time. Except as provided in Section 2(b), under no
circumstances will any Agent be obligated to purchase any Notes for its
own account. It is understood and agreed, however that any Agent may
purchase Notes as principal pursuant to Section 2(b);
(iv) the Corporation reserves the right, in its sole
discretion, to suspend solicitation of offers to purchase the Notes
commencing at any time for any period of time or permanently. Upon
receipt of at least one business day's prior notice from the
Corporation, the Agents will forthwith suspend solicitation of offers
to purchase Notes from the Corporation until such time as the
Corporation has advised the Agents that such solicitation may be
resumed. For the purpose of the foregoing sentence, "business day"
shall mean any day which is not a Saturday or Sunday or a legal holiday
and which is not a day on which banking institutions are authorized or
required by law or regulation to close in New York, New
<PAGE> 8
8
York. The suspension of solicitation of offers to purchase the Notes
by the Corporation shall likewise suspend until the next Representation
Date the representations and warranties set forth in Section 1 and the
covenants set forth in Sections 4 and 9, except as and to the extent
provided in Section 13;
(v) promptly upon the closing of the sale of any Notes sold by
the Corporation as a result of a solicitation made by an Agent, the
Corporation agrees to pay such Agent a commission in accordance with
the schedule set forth in Exhibit A hereto;
(vi) the Agents are authorized to solicit offers to purchase
the Notes only in denominations of U.S. $100,000 2/ or any amount in
excess thereof which is an integral multiple of U.S. $1,000, at a
purchase price equal to 100% of the principal amount thereof or such
other principal amount as shall be specified by the Corporation. Each
Agent shall communicate to the Corporation, orally or in writing, each
reasonable offer to purchase Notes received by it as an Agent other
than those rejected by such Agent pursuant to the next sentence. Each
Agent shall have the right, in its discretion reasonably exercised
without advising the Corporation, to reject any offer to purchase the
Notes received by it, in whole or in part, and any such rejection shall
not be deemed a breach of its agreement contained herein. The
Corporation shall have the sole right to accept offers to purchase the
Notes and may reject any such offer in whole or in part;
(vii) the Procedures may be amended in writing from time to
time by mutual agreement of the Agents and the Corporation after
notice to, and with the approval of, the Trustee. Each Agent and the
Corporation agree to perform the respective duties and obligations
specifically provided to be performed by each of them herein and in
the Procedures; and
- ---------------------
2/ Or the equivalent (rounded down to an integral multiple of 10,000
units of the denomination specified in a supplement to the Prospectus) in the
relevant foreign currency or currency unit, or such larger amount in integral
multiples of 10,000 units of such denomination.
<PAGE> 9
9
(viii) the documents required to be delivered by Section 6 hereof
shall be delivered at the offices of Cravath, Swaine & Moore, 825
Eighth Avenue, New York, New York 10019 not later than 10:00 A.M., New
York City time, on the date of this Agreement or at such later time or
other location in New York City as may be mutually agreed upon by the
Corporation and the Agents, which in no event shall be later than the
time at which the Agents commence solicitation of offers to purchase
Notes hereunder (the "Closing Date").
(b) Subject to the terms and conditions stated herein,
whenever the Corporation and any of you determines that the Corporation shall
sell Notes directly to any of you as principal, each such sale of Notes shall be
made in accordance with the terms of this Agreement and a supplemental agreement
relating to such sale. Each such supplemental agreement, which may be either
oral or written, is herein referred to as a "Terms Agreement":
(i) each Terms Agreement shall describe the Notes to be
purchased by the Purchaser pursuant thereto and shall specify the
aggregate principal amount of such Notes, the price to be paid to the
Corporation for such Notes, the currency in which such Notes are
issued, the maturity date of such Notes, the rate at which interest
will be paid on such Notes, the dates on which interest will be paid on
such Notes and the record date with respect to each such payment of
interest, the Closing Date for the purchase of such Notes, the place
of delivery of the Notes and payment therefor, the method of payment
and any requirements for the delivery of opinions of counsel,
certificates from the Corporation or its officers or a letter from the
Corporation's independent public accountants as described in Section
7(f). Any such Terms Agreement may also specify the period of time
referred to in Section 4(k). Any written Terms Agreement may be in the
form attached hereto as Exhibit C. The Purchaser's commitment to
purchase Notes shall be deemed to have been made on the basis of the
representations and warranties of the Corporation herein contained and
shall be subject to the terms and conditions herein set forth;
(ii) delivery of the certificates for Notes sold to the
Purchaser pursuant to a Terms Agreement shall be made not later than
the Closing Date agreed to in such Terms Agreement, against payment of
funds to the
<PAGE> 10
10
Corporation in the net amount due to the Corporation for such Notes by
the method and in the form set forth in such Terms Agreement; and
(iii) unless otherwise agreed to between the Corporation and
the Purchaser in a Terms Agreement, any Note sold to a Purchaser (A)
shall be purchased by such Purchaser at a price equal to 100% of the
principal amount thereof less a percentage equal to the commission
applicable to an agency sale of a Note of identical maturity and (B)
may be resold by such Purchaser at varying prices from time to time or,
if set forth in the applicable Terms Agreement and pricing supplement,
at a fixed public offering price. In connection with any resale of
Notes purchased, a Purchaser may use a selling or dealer group and may
reallow to any broker or dealer any portion of the discount or
commission payable pursuant hereto.
SECTION 3. Offering and Sale of Notes. Each Agent and the
Company agree to perform the respective duties and obligations specifically
provided to be performed by them in the Procedures.
SECTION 4. Covenants of the Corporation. The Corporation
covenants and agrees:
(a) To furnish promptly to each of you and to your
counsel a signed copy of the Registration Statement as originally filed and
each amendment or supplement thereto, and a copy of each Prospectus filed with
the Commission, including all supplements thereto and all documents
incorporated therein by reference and all consents and exhibits filed
therewith.
(b) To deliver promptly to each of you such number of the
following documents as each of you may reasonably request: (i) conformed copies
of the Registration Statement (excluding exhibits other than the computation of
the ratio of earnings to fixed charges, the Indenture and this Agreement), (ii)
the Basic Prospectus, each preliminary prospectus and the Prospectus and (iii)
any documents incorporated by reference in the Prospectus.
(c) If, during any period in which, in the opinion of your
counsel, a prospectus relating to the Notes is required to be delivered under
the Securities Act in respect of Notes being offered for sale by any of you, any
event
<PAGE> 11
11
relating to or affecting the Corporation occurs as a result of which the
Prospectus would include an untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or if it
is necessary at any time to amend the Prospectus to comply with the Securities
Act (other than periodic reports under the Exchange Act that are timely filed),
to notify each of you promptly to suspend solicitation of purchases of the
Notes; and if the Corporation shall decide to amend or supplement the
Registration Statement or the Prospectus, to promptly advise each of you by
telephone (with confirmation in writing) and to promptly prepare and timely file
with the Commission an amendment or supplement which will correct such statement
or omission or an amendment which will effect such compliance; provided,
however, that if during the period referred to above, in the case of a sale made
pursuant to a Terms Agreement, the Corporation shall promptly prepare and timely
file with the Commission any amendment or supplement to the Registration
Statement or any Prospectus that may, in the judgment of the Corporation or the
Purchaser, be required by the Securities Act or requested by the Commission.
(d) To timely file with the Commission during the period
referred to in (c) above all documents (and any amendments to previously filed
documents) required to be filed by the Corporation pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act.
(e) Upon filing with the Commission during the period referred
to in (c) above (i) any amendment or supplement to the Registration Statement,
(ii) any amendment or supplement to the Prospectus or (iii) any document
incorporated by reference in any of the foregoing or any amendment of or
supplement to any such incorporated document, to furnish a copy thereof to
each of you.
(f) During the period referred to in (c) above, to advise
each of you (i) when any post-effective amendment to the Registration
Statement relating to or covering the Notes becomes effective, (ii) of any
demand by the Commission for an amendment or supplement to the
Registration Statement, to the Prospectus, to any document incorporated by
reference in any of the foregoing or for any additional information (other than
any demand for an amendment or supplement to or additional information
concerning documents hereafter filed with the Commission
<PAGE> 12
12
pursuant to the Exchange Act and incorporated by reference in the Registration
Statement and Prospectus, where the failure to comply with such request would
not cause the Registration Statement or the Prospectus, as then supplemented or
amended, to fail to comply in any material respect with the provisions of the
Securities Act and the applicable Rules or to 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) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement or any part thereof or any order directed to the
Prospectus or any document incorporated therein by reference or the initiation
or threat of any stop order proceeding, (iv) of receipt by the Corporation of
any notification with respect to the suspension of the qualification of the
Notes for sale in any jurisdiction or the initiation or threat of any proceeding
for that purpose and (v) of the happening of any event relating to or affecting
the Corporation which makes untrue any statement of a material fact made in the
Registration Statement or the Prospectus or which requires the making of a
change in the Registration Statement or the Prospectus in order to make any
material statement therein not misleading.
(g) If, during the period referred to in (c) above, the
Commission shall issue a stop order suspending the effectiveness of the
Registration Statement, to make every reasonable effort to obtain the lifting
of that order at the earliest possible time.
(h) As soon as practicable, but not later than 18 months,
after the date of each acceptance by the Corporation of an offer to purchase
Notes hereunder, to make generally available to its security holders and each
of you an earnings statement or statements which will satisfy the provisions
of Section 11(a) of the Securities Act (including, at the option of the
Corporation, Rule 158 of the Rules).
(i) So long as any of the Notes are outstanding (including by
way of resale by a Purchaser of Notes), to furnish to each of you, not later
than the time the Corporation makes the same available to others, copies of all
public reports or press releases (i) sent by the Corporation over the P.R.
Newswire, (ii) furnished by the Corporation to any securities exchange on which
the Notes are listed pursuant to requirements of or agreements with
<PAGE> 13
13
such exchange or (iii) filed with the Commission pursuant to the Exchange Act or
any rule or regulation of the Commission thereunder.
(j) To endeavor, in cooperation with each of you, to qualify
the Notes for offering and sale under the securities laws of such jurisdictions
as each of you may designate, and to maintain such qualifications in effect for
as long as may be required for the distribution of the Notes, and to file such
statements and reports as may be required by the laws of each jurisdiction in
which the Notes have been qualified as above provided; provided, however, that
the Corporation shall not be required to register or qualify as a foreign
corporation nor, except as to matters and transactions relating to the offer or
sale of the Notes, take any action which would subject it to service of process
generally in any jurisdiction.
(k) During the period, if any, specified (whether orally or in
writing) in any Terms Agreement, the Corporation shall not, without the prior
consent of the Purchaser thereunder, offer, sell or contract to sell, or
otherwise dispose of, directly or indirectly, or announce the offering of, any
debt securities issued or guaranteed by the Corporation (other than the Notes
being sold pursuant to such Terms Agreement, borrowings under the Corporation's
revolving credit agreements and lines of credit, the private placement of
securities and issuances of the Corporation's commercial paper).
SECTION 5. Payment of Expenses. The Corporation will pay (i)
the costs incident to the authorization, issuance, sale and delivery of the
Notes and any taxes payable in that connection, (ii) the costs incident to the
preparation, printing and filing under the Securities Act of the Registration
Statement and any amendments and exhibits thereto, (iii) the costs incident to
the preparation, printing and filing of any document and any amendments and
exhibits thereto required to be filed by the Corporation under the Exchange Act,
(iv) the costs of distributing, as each of you may reasonably request, the
Registration Statement, as originally filed, and each amendment and
post-effective amendment thereof (including exhibits), any preliminary
prospectus, the Basic Prospectus, the Prospectus, any supplement or amendment to
the Prospectus and any documents incorporated by reference in any of the
foregoing documents, (v) the fees and disbursements of the Trustee, any paying
agent, any calculation agent, any exchange rate agent and any other agents
appointed by the Corporation, and their respective
<PAGE> 14
14
counsel, (vi) the costs and fees in connection with the listing of the Notes on
any securities exchange, (vii) the cost of any filings with the National
Association of Securities Dealers, Inc., (viii) the reasonable fees and
disbursements of counsel to the Corporation and your counsel, (ix) the fees paid
to rating agencies in connection with the rating of the Notes, (x) the fees and
expenses of qualifying the Notes under the securities laws of the several
jurisdictions as provided in Section 4(j) hereof and of preparing and printing a
Blue Sky Memorandum and a memorandum concerning the legality of the Notes as an
investment (including the reasonable fees and expenses of your counsel in
connection therewith), (xi) all advertising expenses in connection with the
offering of the Notes incurred with the consent of the Corporation and (xii)
other costs and expenses incurred by the Corporation in connection with the
performance of its obligations under this Agreement.
SECTION 6. Conditions of Obligations of the Agents. The
obligations of the Agents, as agents of the Corporation, under this Agreement to
solicit offers to purchase the Notes, and the obligation of any person who has
agreed to purchase Notes sold through an Agent as agent to make payment for and
take delivery of Notes, are subject to the accuracy on each Representation
Date of the representations and warranties of the Corporation contained herein,
to the performance by the Corporation of its obligations hereunder, and to
each of the following additional terms and conditions:
(a) If filing of the Prospectus, or any supplement thereto, is
required pursuant to Rule 424(b), the Prospectus, and any such supplement, shall
have been filed in the manner and within the time period required by Rule
424(b); no stop order suspending the effectiveness of the Registration Statement
or any part thereof nor any order directed to any document incorporated by
reference in the Prospectus shall have been issued; no stop order proceeding
shall have been initiated or threatened by the Commission; no challenge shall
have been made by the Commission and shall not have been satisfactorily answered
or remedied by the Corporation to the accuracy or adequacy of any document
incorporated by reference in the Prospectus in any respect that would constitute
a failure of the Prospectus, as supplemented, to comply in any material respect
with the provisions of the Securities Act and the applicable Rules or that, if
substantiated, would mean that the Prospectus, as
<PAGE> 15
15
supplemented, would contain any untrue statement of a material fact or would
omit to state any material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances in which
they were made, not misleading; any request of the Commission of the nature
referred to in Section 4(f)(ii) shall have been complied with.
(b) No order suspending the sale of the Notes in any
jurisdiction designated by the Agents pursuant to Section 4(j) hereof shall have
been issued, and no proceeding for that purpose shall have been initiated or
threatened.
(c) The Agents shall not have discovered and disclosed to the
Corporation that the Registration Statement or any Prospectus contains an
untrue statement of a fact which, in the opinion of counsel for the Agents, is
material or omits to state a fact which, in the opinion of such counsel, is
material and is required to be stated therein or is necessary to make the
statements therein not misleading.
(d) All corporate proceedings and other legal matters
incident to the authorization, form and validity of this Agreement, the Notes,
the Indenture, the form of the Registration Statement, the Prospectus (other
than financial statements and other financial data) and all other legal matters
relating to this Agreement and the transactions contemplated hereby shall be
satisfactory in all respects to counsel for the Agents and the Corporation
shall have furnished to such counsel all documents and information that they
may reasonably request to enable them to pass upon such matters.
(e) At the Closing Date, the Agents shall have received the
opinion, addressed to the Agents and dated the Closing Date, of the General
Counsel of the Corporation or the Assistant General Counsel of the Corporation,
in form and substance satisfactory to the Agents and their counsel, to the
effect that:
(i) the Corporation has been duly incorporated and is a
validly existing corporation in good standing under the laws of the
State of Delaware, and has the corporate power to own or hold under
lease the property it purports to own or hold under lease and to carry
on the business in which it is engaged;
<PAGE> 16
16
(ii) the form of the Notes and the Indenture conform in all
material respects to the descriptions thereof contained in the
Registration Statement and the Prospectus;
(iii) the issuance, sale and delivery of the Notes by the
Corporation pursuant to this Agreement have been duly and validly
authorized by all necessary corporate action; and no authorization,
consent or approval of, or filing or registration with, or exemption
by, any government or public body or authority of the United States or
of any State or any Department or subdivision thereof, other than such
as may be required under the securities or blue sky laws of any
jurisdiction, is required for the validity of the Notes or for the
valid offering, issuance, sale and delivery of the Notes by the
Corporation pursuant to this Agreement or for the execution and
delivery by the Corporation of this Agreement and the Indenture;
(iv) the Indenture has been duly and validly authorized,
executed and delivered by the Corporation and constitutes an
instrument valid and binding on the Corporation and enforceable in
accordance with its terms (except as (a) the enforceability thereof
may be limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally and (b) rights of
acceleration and the availability of equitable remedies may be limited
by equitable principles of general applicability);
(v) the Notes, when issued in a form conforming to the
specimens thereof examined by such counsel, will be in a form
contemplated by the Indenture and, assuming due execution of the Notes
on behalf of the Corporation and authentication thereof by the
Trustee, upon the delivery thereof and payment therefor as provided in
this Agreement, the Notes will constitute valid and binding
obligations of the Corporation enforceable in accordance with their
respective terms (except as (a) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally and (b) rights of
acceleration and the availability of equitable remedies may be limited
by equitable principles of general applicability), entitled to the
benefits of the Indenture;
<PAGE> 17
17
(vi) this Agreement has been duly authorized, executed and
delivered by the Corporation, and the performance of this Agreement
and the consummation of the transactions herein contemplated will not
result in a breach of any of the terms or provisions of, or constitute
a default under, the Restated Certificate of Incorporation or By-laws
of the Corporation or, to the knowledge of such counsel, any law,
administrative regulation or court decree applicable to the
Corporation or by which the Corporation or any of its proper-
ties is bound or affected (except to the extent that the
enforceability of the indemnity provisions of this Agreement may be
limited by securities laws or public policy);
(vii) the performance of this Agreement and the consummation
of the transactions herein contemplated will not result in a breach of
any of the terms or provisions of, or constitute a default under, any
indenture, deed of trust, note, note agreement or other agreement or
instrument known to such counsel to which the Corporation or any of
its subsidiaries is a party or by which the Corporation or any of its
subsidiaries or any of their properties is bound or affected;
(viii) the Registration Statement and any amendments thereof
have become and are effective and the Registration Statement, the
Prospectus and each amendment thereof or supplement thereto, as of
their respective effective or issue dates, complied as to form in all
material respects with the requirements of the Securities Act, and the
Rules (except that no opinion need be expressed as to financial
statements and other financial data), the Securities are registered
under the Securities Act, and the Indenture has been qualified under
the Trust Indenture Act; and
(ix) in passing upon the form of the Registration Statement
and the Prospectus, such counsel has necessarily assumed the
correctness and completeness of the statements made or included
therein and takes no responsibility therefor, except insofar as such
statements relate to the description of the Notes or the Indenture or
relate to such counsel; the statements with regard to such counsel
made under the heading "Legal Opinions" in the Prospectus are correct;
and such counsel has no reason to believe that (except as aforesaid)
the Registration Statement (or any post-effective
<PAGE> 18
18
amendment thereof) at the time it became effective contained any
untrue statement of a material fact or omitted to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading or that (except as aforesaid) the
Prospectus (as amended or supplemented, if so amended or supplemented)
contains any untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading as of the Closing Date.
(f) The Corporation shall have furnished to the Agents on the
Closing Date a certificate of the Corporation, dated the Closing Date, signed
on its behalf by the President, the Vice President-Finance or the Treasurer,
stating that:
(i) The representations, warranties and agreements of the
Corporation in section 1 hereof are true and correct in all material
respects as of the date of such certificate with the same effect as if
made on such date; and the Corporation has not received any notice
that the conditions set forth in Section 5(a) hereof will not be
satisfied as of the Closing Date or any other Representation Date; and
(ii) The person executing such certificate has examined the
Registration Statement and the Prospectus and, in such person's
opinion, (A) the Registration Statement at the date thereof, or as of
the most recent amendment thereto, if any, did 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, (B) the Prospectus as supplemented at the date of such
certificate does not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading (other than
the information to be provided in pricing supplements thereto as
contemplated by Section l(a) hereof), and (C) since the effective date
of the Registration Statement (or the most recent amendment thereto,
if any) there has not occurred any
<PAGE> 19
19
event required to be set forth in an amendment to the Registration
Statement which has not been so set forth.
(g) The Corporation shall have furnished to the Agents on the
Closing Date a letter of Arthur Andersen LLP, addressed jointly to the
Corporation and the Agents and dated the Closing Date, of the type described in
the American Institute of Certified Public Accountants Statement on Auditing
Standards No. 76 substantially in the form heretofore approved by the Agents,
covering such specified financial statement items and procedures as the Agents
may reasonably request and in form and substance reasonably satisfactory to the
Agents.
(h) There shall not have occurred, since the date of this
Agreement, in the case of the obligations of the Agents to solicit offers, or
since the date of the Corporation's acceptance of an offer to purchase Notes,
in the case of the obligation to purchase such Notes: any material adverse
change in, or any adverse development which materially affects the business,
properties, condition (financial or other), results of operations or prospects
of the Corporation and its consolidated subsidiaries taken as a whole; a
suspension or material limitation in trading in securities generally on the New
York Stock Exchange or the establishment of minimum prices on such exchange; a
general moratorium on commercial banking activities declared by either federal
or New York State authorities; any material adverse change in the existing
financial, political or economic conditions in the United States or elsewhere;
an outbreak or escalation of major hostilities involving the United States or
the declaration of a national emergency or war by the United States; or any
downgrading in the rating accorded the Corporation's debt securities by any
"nationally recognized statistical rating organization", as that term is
defined by the Commission for purposes of Rule 436(g)(2) under the Securities
Act, or any public announcement by any such organization that the rating
accorded any of the Corporation's debt securities have been placed under
surveillance or review with possible negative implications, if the effect
thereof in the judgment of such Agent or purchaser makes it impracticable or
inadvisable to proceed with the solicitation of offers to purchase Notes or the
purchase of Notes from the Corporation, as the case may be.
(i) Prior to the Closing Date, the Corporation shall have
furnished to the Agents such further information,
<PAGE> 20
20
certificates and documents as the Agents or counsel to the Agents may reasonably
request.
All opinions, letters, evidence and certificates mentioned
above or elsewhere in this Agreement shall be deemed to be in compliance with
the provisions hereof only if they are in form and substance satisfactory to
counsel for the Agents.
SECTION 7. Conditions to the Obligations of a Purchaser. The
obligations of a Purchaser to purchase any Notes will be subject to the accuracy
of the representations and warranties on the part of the Corporation herein as
of the date of the related Terms Agreement and as of the Closing Date for such
Notes, to the performance and observance by the Corporation of all covenants and
agreements herein contained on its part to be performed and observed and to the
following additional conditions precedent:
(a) If filing of the Prospectus, or any supplement thereto, is
required pursuant to Rule 424(b), the Prospectus, and any such
supplement, shall have been filed in the manner and within the time
period required by Rule 424(b); no stop order suspending the
effectiveness of the Registration Statement or any part thereof nor any
order directed to any document incorporated by reference in the
Prospectus shall have been issued; no stop order proceeding shall have
been initiated or threatened by the Commission; no challenge shall have
been made by the Commission and shall not have been satisfactorily
answered or remedied by the Corporation to the accuracy or adequacy of
any document incorporated by reference in the Prospectus in any respect
that would constitute a failure of the Prospectus, as supplemented, to
comply in any material respect with the provisions of the Securities
Act and the applicable Rules or that, if substantiated, would mean that
the Prospectus, as supplemented, would contain any untrue statement of
a material fact or would omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in
the light of the circumstances in which they were made, not misleading;
any request of the Commission of the nature referred to in Section
4(f)(ii) shall have been complied with.
<PAGE> 21
21
(b) No order suspending the sale of the Notes in any
jurisdiction designated by the Purchaser pursuant to Section 4(j)
hereof shall have been issued, and no proceeding for that purpose shall
have been initiated or threatened.
(c) The Purchaser shall not have discovered and disclosed to
the Corporation that the Registration Statement or any Prospectus
contains an untrue statement of a fact which, in the opinion of counsel
for the Purchaser, is material or omits to state a fact which, in the
opinion of such counsel, is material and is required to be stated
therein or is necessary to make the statements therein not misleading.
(d) All corporate proceedings and other legal matters incident
to the authorization, form and validity of this Agreement, the Notes,
the Indenture, the form of the Registration Statement, the Prospectus
(other than financial statements and other financial data) and all
other legal matters relating to this Agreement and the transactions
contemplated hereby shall be satisfactory in all respects to counsel
for the Purchaser and the Corporation shall have furnished to such
counsel all documents and information that they may reasonably request
to enable them to pass upon such matters.
(e) Each Terms Agreement shall be subject to termination in
the absolute discretion of the Purchaser, by notice given to the
Company prior to delivery of any payment for any Note to be purchased
thereunder, if prior to such time: any material adverse change in, or
any adverse development which materially affects the business,
properties, condition (financial or other), results of operations or
prospects of the Corporation and its consolidated subsidiaries taken
as a whole; a suspension or material limitation in trading in
securities generally on the New York Stock Exchange or the
establishment of minimum prices on such exchange; a general moratorium
on commercial banking activities declared by either federal or New York
State authorities; any material adverse change in the existing
financial, political or economic conditions in the United States or
elsewhere; an outbreak or escalation of major hostilities involving the
United States or the declaration of a national emergency or war by the
United States; or any downgrading in the
<PAGE> 22
22
rating accorded the Corporation's debt securities by any "nationally
recognized statistical rating organization", as that term is defined by
the Commission for purposes of Rule 436(g)(2) under the Securities Act,
or any public announcement by any such organization that the rating
accorded any of the Corporation's debt securities have been placed
under surveillance or review with possible negative implications, if
the effect thereof in the judgment of such Purchaser makes it
impracticable or inadvisable to proceed with the purchase of Notes from
the Corporation.
(f) To the extent agreed to between the Corporation and the
Purchaser in a Terms Agreement, the Purchaser shall have received,
appropriately updated, (i) a certificate of the Corporation, dated as
of the Closing Date, to the effect set forth in Section 6(f) (except
that references to the Prospectus shall be to the Prospectus as
supplemented as of the date of such Terms Agreement), (ii) the opinion
of the General Counsel of the Corporation or the Assistant General
Counsel of the Corporation, dated as of the Closing Date, to the effect
set forth in Section 6(e), and (iii) letter of Arthur Andersen LLP,
independent accountants for the Corporation, dated as of the Closing
Date, to the effect set forth in Section 6(g).
(g) Prior to the Closing Date, the Corporation shall have
furnished to the Purchaser such further information, certificates and
documents as the Purchaser may reasonably request.
If any of the conditions specified in this Section 7 shall not
have been fulfilled in all material respects when and as provided in this
Agreement and the applicable Terms Agreement, or if any of the opinions and
certificates mentioned above or elsewhere in this Agreement or such Terms
Agreement and required to be delivered to the Purchaser pursuant to the terms
hereof and thereof shall not be in all material respects reasonably satisfactory
in form and substance to the Purchaser and its counsel, such Terms Agreement and
all obligations of the Purchaser thereunder and with respect to the Notes
subject thereto may be canceled at, or at any time prior to, the respective
Closing Date by the Purchaser. Notice of such cancelation shall be given to the
Corporation in writing or by telephone or telegraph confirmed in writing.
<PAGE> 23
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SECTION 8. Right of Person Who Agreed to Purchase to Refuse
to Purchase. The Company agrees that any person who has agreed to purchase and
pay for any Note pursuant to a solicitation by any of the Agents shall have the
right to refuse to purchase such Note if, at the Closing Date therefor, any
condition set forth in Section 6 shall not be satisfied.
SECTION 9. Additional Covenants of the Corporation. The
Corporation covenants and agrees that:
(a) Each acceptance by it of an offer for the purchase of
Notes solicited by an Agent hereunder shall be deemed to be an affirmation that
the representations and warranties of the Corporation contained in this
Agreement are true and correct at the time of such acceptance, and an
undertaking that such representations and warranties will be true and correct
at the time of delivery to the purchaser or his agent of the Notes relating to
such acceptance as though made at and as of each such time (and it is
understood that such representations and warranties shall relate to the
Registration Statement and the Prospectus as amended or supplemented to each
such time).
(b) Each time that the Registration Statement or the
Prospectus shall be amended or supplemented (other than by a pricing supplement
or an amendment or supplement providing solely for a change in the interest
rates or maturities of the Notes or a change in the principal amount of Notes
remaining to be sold or similar changes and other than by the filing of a
document incorporated by reference into the Prospectus other than the documents
specified below) or the Corporation files with the Commission an Annual Report
on Form 10-K, a Quarterly Report on Form 10-Q, or a Current Report on Form 8-K
pursuant to Item 1, 2, 4, or 6 of such Form, the Corporation shall,
concurrently with or promptly after such amendment, supplement or filing,
furnish the Agents with a certificate of the President, the Vice
President--Finance or the Treasurer of the Corporation in form satisfactory to
the Agents to the effect that the statements contained in the certificate
referred to in Section 6(f) hereof which was last furnished to the Agents are
true and correct at the time of such amendment, supplement or filing, as the
case may be, as though made at and as of such time (except that such statements
shall be deemed to relate to the Registration Statement and the Prospectus as
amended and supplemented to such time) or, in lieu of such certificate, a
certificate of the same tenor as
<PAGE> 24
24
the certificate referred to in said Section 6(f), modified as necessary to
relate to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such certificate; provided, however,
that if at the time of such amendment or supplement, the Corporation is not
accepting offers to purchase the Notes or has instructed the Agents to cease
their solicitation of offers to purchase the Notes, then the certificate
required to be delivered pursuant to this Section 9(b) shall not be required
until the Corporation requests that the Agents resume the solicitation of offers
to purchase Notes.
(c) Each time that the Registration Statement or the
Prospectus shall be amended or supplemented (other than by a pricing supplement
or an amendment or supplement providing solely for a change in the interest
rates or maturities of the Notes or a change in the principal amount of Notes
remaining to be sold or similar changes and other than by the filing of a
document incorporated by reference into the Prospectus other than the documents
specified below) or the Corporation files with the commission an Annual Report
on Form 10-K, a Quarterly Report on Form 10-Q, or a Current Report on Form 8-K
pursuant to Item 1, 2, 4, or 6 of such Form, the Corporation shall,
concurrently with or promptly after such amendment, supplement or filing,
furnish the Agents and their counsel with the written opinion of the General
Counsel or the Assistant General counsel of the Corporation, addressed to the
Agents and dated the date of delivery of such opinion, in form satisfactory to
the Agents, of the same tenor as the opinion referred to in Section 6(e)
hereof, but modified, as necessary, to relate to the Registration Statement and
the Prospectus as amended or supplemented to the time of delivery of such
opinion; provided, however, that in lieu of such opinion, such counsel may
furnish the Agent with a letter to the effect that the Agent may rely on such
prior opinion to the same extent as though it was dated the date of such letter
authorizing reliance (except that statements in such prior opinion shall be
deemed to relate to the Registration Statement and the Prospectus as amended or
supplemented to the time of delivery of such letter authorizing reliance);
provided, further, however, that if at the time of such amendment or
supplement, the Corporation is not accepting offers to purchase the Notes or
has instructed the Agents to cease their solicitation of offers to purchase the
Notes, then the opinion or letter required to be delivered pursuant to this
Section 9(c) shall not be required until the
<PAGE> 25
25
Corporation requests that the Agents resume the solicitation of offers to
purchase Notes.
(d) Each time that the Registration Statement or the
Prospectus shall be amended or supplemented to include additional financial
information (other than by the filing of a document incorporated by reference
into the Prospectus other than the documents specified below) or the
Corporation files with the Commission an Annual Report on Form 10-K, a
Quarterly Report on Form 10-Q or a current Report on Form 8-K pursuant to Item
2 or 4 of such Form, the Corporation shall cause Arthur Andersen LLP (or the
Corporation's then current independent public accountants) to furnish the
Agents, concurrently with or promptly after such amendment, supplement or
filing, a letter, addressed jointly to the Corporation and the Agents and dated
the date of delivery of such letter, in form and substance reasonably
satisfactory to the Agents, of the same tenor as the letter referred to in
Section 6(g) hereof but modified to relate to the Registration Statement and
the Prospectus, as amended and supplemented to the date of such letter, with
such changes as may be necessary to reflect changes in the financial statements
and other information derived from the accounting records of the Corporation;
provided, however, that if the Registration Statement or the Prospectus is
amended or supplemented solely to include financial information as of and for a
fiscal quarter, Arthur Andersen LLP may limit the scope of such letter to the
unaudited financial statements included in such amendment or supplement unless
there is contained therein any other accounting, financial or statistical
information that, in the reasonable judgment of the Agents, should be covered
by such letter, in which event such letter shall also cover such other
information; provided, further, however, that if at the time of such amendment
or supplement, the Corporation is not accepting offers to purchase the Notes or
has instructed the Agents to cease their solicitation of offers to purchase the
Notes, then the letter required to be delivered pursuant to this Section 9(d)
shall not be required until the Corporation requests that the Agents resume the
solicitation of offers to purchase Notes.
SECTION 10. Indemnities. (a) By the Corporation. The
Corporation agrees to indemnify and hold harmless each of you and each person
who controls each of you within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act against any and all losses, claims,
damages or liabilities, joint or
<PAGE> 26
26
several, to which you, they or any of you or them may become subject under the
Securities Act, the Exchange Act or any other statute or common law, and to
reimburse each such indemnified party for any legal or other expenses reasonably
incurred by them in connection with investigating any claims and defending any
actions, insofar as such losses, claims, damages, liabilities or actions arise
out of or are based upon (i) any untrue statement or alleged untrue statement of
a material fact contained in the Registration Statement or any post-effective
amendment thereof, or the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or (ii) any untrue statement or alleged untrue statement
of a material fact contained in any preliminary prospectus, if used prior to the
issue date of the Prospectus, or contained in the Prospectus (as amended or
supplemented, if the Corporation shall have filed with the Commission any
amendment thereof or supplement thereto), if, in the case of a sale made by the
Agents, used within the period during which the Agents are authorized to solicit
offers to purchase the Notes as provided in Section 2(a)(iv) hereof, or the
omission or alleged omission to state therein (if so used) a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; provided, however, that the indemnity agreement contained in this
Section 10(a) shall not apply to any such losses, claims, damages, liabilities
or actions arising out of, or based upon, any such untrue statement or alleged
untrue statement, or any such omission or alleged omission if such statement or
omission was made in reliance upon and in conformity with information furnished
in writing to the Corporation by or on behalf of any of you for use in
connection with the preparation of the Registration Statement, any preliminary
prospectus or the Prospectus or any such amendment thereof or supplement
thereto, or was contained in that part of the Registration Statement
constituting the Statement of Eligibility and Qualification (Form T-1) under the
Trust Indenture Act of the Trustee; and provided, further, such indemnity with
respect to the Prospectus or any preliminary prospectus shall not inure to the
benefit of an Agent or a Purchaser (or any person controlling such Agent or such
Purchaser) if the person asserting any such loss, claim, damage or liability
purchased the Notes which are the subject thereof from such Agent or such
Purchaser and such person did not receive a copy of the Prospectus (or the
Prospectus as supplemented) excluding documents incorporated
<PAGE> 27
27
therein by reference at or prior to the confirmation of the sale of such Notes
to such person in any case where such delivery is required by the Securities Act
and the untrue statement or omission of a material fact contained in the
Prospectus or any preliminary prospectus was corrected in the Prospectus (or the
Prospectus as supplemented). The indemnity agreement contained in this Section
10(a) is subject to the undertaking of the Corporation with respect to
indemnification of officers and directors of the Corporation contained in the
Registration Statement, but only to the extent stated in said undertaking.
(b) By the Agents. Each Agent or Purchaser agrees, in the manner and
to the same extent as set forth in Section 10(a) hereof, to indemnify and hold
harmless the Corporation, each person who controls the Corporation within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
each director of the Corporation and each of its officers who shall have signed
the Registration Statement, with respect to any statement in or omission from
the Registration Statement or any post-effective amendment thereof or the Basic
Prospectus, any preliminary prospectus or the Prospectus (as amended or
supplemented, if so amended or supplemented), if such statement or omission was
made in reliance upon and in conformity with information furnished as herein
stated or otherwise furnished in writing to the Corporation by or on behalf of
such Agent or such Purchaser for use in connection with the preparation of the
Registration Statement or any preliminary prospectus or the Prospectus or any
such amendment thereof or supplement thereto.
(c) General. Each indemnified party will, promptly after the
receipt of notice of the commencement of any action against such indemnified
party in respect of which indemnity may be sought from an indemnifying party on
account of an indemnity agreement contained in this Section 10, notify the
indemnifying party in writing of the commencement thereof. The omission of any
indemnified party so to notify an indemnifying party of any such action shall
relieve such indemnifying party from any liability which it may have to such
indemnified party on account of the indemnity agreement contained in this
Section 10, but shall not relieve such indemnifying party from any other
liability which it may have to such indemnified party. Except as provided in
the next succeeding sentence, in case any such action shall be brought against
any indemnified party and it shall notify an indemnifying party of the
<PAGE> 28
28
commencement thereof, such indemnifying party will be entitled to participate
therein and, to the extent that it may wish, jointly with any other indemnifying
party similarly notified, to assume the defense thereof, with counsel
satisfactory to such indemnified party, and after notice from such indemnifying
party to such indemnified party of its election so to assume the defense
thereof, such indemnifying party will not be liable to such indemnified party
under this Section 10 for any legal or other expenses subsequently incurred by
such indemnified party in connection with the defense thereof other than
reasonable costs of investigation. Such indemnified party shall have the right
to employ its own counsel in any such action, but the fees and expenses of such
counsel shall be at the expense of such indemnified party unless (i) the
employment of such counsel has been authorized by the indemnifying party in
connection with the defense of such action, (ii) the named parties to any such
action (including any impleaded parties) include both such indemnified party and
the indemnifying party and such indemnified party shall have been advised by
such counsel that representation of both such indemnified party and the
indemnifying party by the same counsel would be inappropriate due to actual or
potential differing interests between them (in which case the indemnifying party
shall not have the right to assume the defense of such action on behalf of such
indemnified party, it being understood, however, that the indemnifying party
shall not, in connection with any one such action, or separate but substantially
similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses with respect to any period during the pendency of such action or
similar or related actions of more than one separate firm of attorneys for all
indemnified parties so named, designated in writing by the Agents or the
Purchaser if the indemnifying party is the Corporation or by the Corporation if
the indemnififying party is any of the Agents or the Purchaser, it being further
understood, however, that the firm of attorneys so designated may be changed
from time to time with respect to different periods during the pendency of such
action or similar or related actions) or (iii) the indemnifying party shall not
have assumed the defense of such action and employed counsel therefor
satisfactory to such indemnified party within a reasonable time after notice of
commencement of such action, in any of which events such fees and expenses shall
be borne by the indemnifying party.
<PAGE> 29
29
The indemnifying party shall not be liable for any settlement of any action or
claim effected without its consent, which consent shall not be unreasonably
withheld.
(d) Contribution. If the indemnification provided for in this
Section 10 shall for any reason be unavailable to an indemnified party under
Section 10(a) or 10(b) hereof in respect of any loss, claim, damage or liability
or any action in respect thereof, referred to therein, then each indemnifying
party shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability, or action in respect thereof, (i) in such proportion
as shall be appropriate to reflect the relative benefits received by the
Corporation on the one hand and by each of you on the other from the offering of
the 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 Corporation on the one hand and by each of you on the other with
respect to the statements or omissions which resulted in such loss, claim,
damage or liability, or action in respect thereof, as well as any other relevant
equitable considerations. The relative benefits received by the Corporation on
the one hand and either Agent on the other with respect to such offering (or, in
the case of Notes sold pursuant to a Terms Agreement, the aggregate commissions
that would have been received by such Purchaser if such commissions had been
payable). The relative fault of the Corporation on the one hand and each of you
on the other shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the
Corporation or by each of you, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Corporation and each of you agree that it would not
be just and equitable if contributions pursuant to this Section 10(d) were to be
determined by pro rata allocation (even if both of you were treated as one
entity for such purpose) or by any other method of
<PAGE> 30
30
allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as a
result of the loss, claim, damage or liability, or action in respect thereof,
referred to above in this Section 10(d) shall be deemed to include, for purposes
of this Section 10(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such claim.
Notwithstanding the provisions of this Section 10(d), neither Agent shall be
required to contribute any amount in excess of the amount by which the total
price at which the Notes sold through such Agent were offered to the public
exceeds the amount of any damages which such Agent or Purchaser has otherwise
paid or become liable to pay by reason of any untrue or alleged untrue statement
or omission or alleged omission (or, in the case of Notes sold pursuant to a
Terms Agreement, the aggregate commissions that would have been received by such
Purchaser if such commissions had been payable). 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.
(e) Survival of Indemnity and Contribution Agreements. The
respective indemnity and contribution agreements of the Corporation and the
Agents contained in this Section 10, and the representations and warranties of
the Corporation set forth in Section 1 hereof, shall remain operative and in
full force and effect, regardless of any termination or cancelation of this
Agreement or any investigation made by or on behalf of (i) any of you or any
such controlling person of any of you or (ii) the Corporation or any such
controlling person, director or officer of the Corporation and shall survive
the delivery of the Notes, and any successor of any of you or of any such
controlling person or of the Corporation, or any legal representative of any
such controlling person, director or officer, as the case may be, shall be
entitled to the benefit of the respective indemnity and contribution
agreements.
SECTION 11. Status of Each Agent. In soliciting offers to
purchase the Notes from the Corporation pursuant to this Agreement (other than
offers to purchase pursuant to Section 2(b)), each Agent is acting solely as
agent for the Corporation and not as principal. Each Agent will make
reasonable efforts to assist the Corporation
<PAGE> 31
31
in obtaining performance by each purchaser whose offer to purchase Notes from
the Corporation has been solicited by such Agent and accepted by the
Corporation, but such Agent shall have no liability to the Corporation in the
event any such purchase is not consummated for any reason. If the Corporation
shall default in its obligations to deliver Notes to a purchaser whose offer it
has accepted, the Corporation shall (i) hold the Agents harmless against any
loss, claim or damage arising from or as a result of such default by the
Corporation and (ii), in particular, pay to the Agents any commission to which
they would be entitled in connection with such sale. The Corporation does not
authorize either Agent to give any information or make any representations,
other than those contained in the Prospectus, as from time to time amended or
supplemented, in connection with the sale of the Notes.
SECTION 12. Representations and Warranties to Survive
Delivery. All representations and warranties of the Corporation contained in
this Agreement, or contained in certificates of officers of the Corporation
submitted pursuant hereto, shall remain operative and in full force and effect,
regardless of the termination or cancelation of this Agreement or any
investigation made by or on behalf of any of you or any person controlling
such of you or by or on behalf of the Corporation, and shall survive each
delivery of and payment for any of the Notes.
SECTION 13. Termination. This Agreement may be terminated
for any reason, at any time, by either the Corporation as to any Agent or an
Agent insofar as this Agreement relates to such Agent upon the giving of one
day's written notice of such termination to such Agent or the Corporation, as
the case may be. The provisions of Sections 4(c) (with respect to Notes that
have been sold but not yet delivered and with respect to Notes owned by a
Purchaser), 4(h), 4(j), 5, 10, 11, 12, 15 and 16 hereof shall survive any such
termination.
SECTION 14. Sales of Securities Denominated in a Foreign
Currency. If at any time the Corporation and any of you shall determine
to issue and sell Notes denominated in a currency or currency unit other than
U.S. dollars, which other currency may include a composite currency, the
Corporation and such of you shall execute and deliver a Foreign Currency
Amendment in the form attached hereto as Exhibit D. The Foreign Currency
Amendment shall establish, as appropriate, additions and
<PAGE> 32
32
modifications to this Agreement that shall apply to the sales, whether offered
on an agency or principal basis, of all Notes denominated in the currency or
currency unit covered thereby.
SECTION 15. Notices. Except as otherwise provided herein, all
notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given if sent by registered mail or transmitted by any
standard form of telecommunication. Notices to the Agents or the Purchaser
shall be directed to them as follows: Lehman Brothers, Lehman Brothers Inc., 3
World Financial Center, 12th Floor, New York, New York 10285-1200, Attention:
Medium-Term Note Department, Telecopy: (212) 528-1718, Telephone: (212)
526-2040; and Goldman, Sachs & Co., 85 Broad Street, New York, New York 10004,
Attention: Credit Department. Notice to the Corporation shall be directed to it
as follows: Air Products and Chemicals, Inc., 7201 Hamilton Boulevard,
Allentown, Pennsylvania 18195-1501, Attention: Corporate Secretary.
SECTION 16. Binding Effect; Benefits. This Agreement shall be
binding upon each of you, your respective successors, the Corporation, and its
respective successors. This Agreement and the terms and provisions hereof are
for the sole benefit of only each of you and these persons, except that (a) the
indemnity agreement of the Corporation contained in Section 10 hereof shall also
be deemed to be for the benefit of the person or persons, if any, who control
each of you within the meaning of Section 15 of the Securities Act, and (b) the
indemnity agreement of the Agents contained in Section 10 hereof shall be deemed
to be for the benefit of directors of the Corporation, officers of the
Corporation who have signed the Registration Statement and any persons
controlling the Corporation within the meaning of Section 15 of the Securities
Act. Nothing in this Agreement is intended or shall be considered to give any
person, other than the persons referred to in this Section, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision contained herein. The term "successor" or the term "successors and
assigns" as used in this Agreement shall not include any purchaser of Notes from
an Agent.
SECTION 17. Governing Law; Counterparts. This Agreement
shall be governed by and construed in accordance with the laws of New York.
This Agreement may be executed
<PAGE> 33
33
in counterparts and the executed counterparts shall together constitute a single
instrument.
If the foregoing correctly sets forth our agreement, please
indicate your acceptance hereof in the space provided for that purpose below.
Very truly yours,
AIR PRODUCTS AND CHEMICALS, INC.,
by
-------------------------------
Title: Vice President and
Treasurer
CONFIRMED AND ACCEPTED, as of the
date first above written:
LEHMAN BROTHERS INC.
by
-------------------------
Name:
-------------------
Title:
------------------
GOLDMAN, SACHS & CO.
by
-------------------------
Name:
-------------------
Title:
------------------
<PAGE> 34
EXHIBIT A
AIR PRODUCTS AND CHEMICALS, INC.
Medium-Term Notes, Series F
Schedule of Payments
The Corporation agrees to pay each Agent a commission equal to
the following percentage of the aggregate U.S. dollar equivalent of the
principal amount of Notes sold by such Agent:
<TABLE>
<CAPTION>
Term Commission Rate
- ---- ---------------
<S> <C>
9 months to less than 12 months .125%
---------
12 months to less than 18 months .150%
---------
18 months to less than 2 years .200%
---------
2 years to less than 3 years .250%
---------
3 years to less than 4 years .350%
---------
4 years to less than 5 years .450%
---------
5 years to less than 6 years .500%
---------
6 years to less than 7 years .550%
---------
7 years to less than 10 years .600%
---------
10 years to less than 15 years .625%
---------
15 years to less than 20 years .650%
---------
20 years to 30 years .750%
---------
</TABLE>
<PAGE> 35
EXHIBIT B
MEDIUM-TERM NOTES, SERIES F
ADMINISTRATIVE PROCEDURES
Medium-Term Notes, Series F Due from 9 months to 30 years from
date of issue (the "Notes") are to be offered on a continuing basis by Air
Products and Chemicals, Inc. (the "Corporation") through Lehman Brothers, a
division of Lehman Brothers Inc., and Goldman, Sachs & Co., and such other
agents as the Corporation shall appoint from time to time on terms
substantially identical to those set forth in the Agency Agreement (each an
"Agent", and, collectively, the "Agents"), who, as agents have agreed to use
their reasonable best efforts to solicit offers to purchase the Notes from the
Corporation. The Agents may also purchase Notes as principal for resale
pursuant to a Terms Agreement.
The Notes are being sold pursuant to an Agency Agreement
between the Corporation and the Agents dated [ ], 1996 (as it may be
amended from time to time, the "Agency Agreement") to which these administrative
procedures are attached as an exhibit. The Corporation has reserved the right
to sell Notes directly on its own behalf. The Notes will be issued pursuant to
an Indenture, dated as of January 10, 1995 (as it may be amended or
supplemented from time to time, the "Indenture"), between the Corporation and
First Union National Bank (formerly First Fidelity Bank, National Association)
as trustee (the "Trustee"). The Notes will rank equally with all other
unsecured and unsubordinated indebtedness of the Corporation and will have been
registered with the Securities and Exchange Commission (the "Commission"). A
Registration Statement (the "Registration Statement") with respect to the Notes
has been filed with the Commission. The Prospectus included in the Registration
Statement that describes the terms of the Notes, as supplemented from time to
time, is herein referred to as the "Prospectus Supplement". The supplement to
the Prospectus that sets forth the specific terms of the Notes is herein
referred to as the "Pricing Supplement".
The Notes will either be issued (a) in book-entry form and
represented by one or more fully registered Notes (each, a "Book-Entry Note")
delivered to the Trustee, as agent for The Depository Trust Corporation
("DTC"), and recorded in the book-entry system maintained by DTC, or
(b) in certificated form delivered to the purchaser thereof or a person
designated by such purchaser. Only Notes
B-1
<PAGE> 36
denominated in U.S. dollars may be issued as Book-Entry Notes. Owners of
beneficial interests in Notes issued in book-entry form will be entitled to
physical delivery of Notes in certificated form equal in principal amount to
their respective beneficial interests only upon certain limited circumstances
described in the Prospectus Supplement.
General procedures relating to the issuance of all Notes are
set forth in Part I hereof. Additionally, Notes issued in book-entry form will
be issued in accordance with the procedures set forth in Part II hereof and
Notes issued in certificated form will be issued in accordance with the
procedures set forth in Part III hereof. Capitalized terms used herein that
are not otherwise defined shall have the meanings ascribed thereto in the
Indenture or the Notes, as the case may be.
PART I: PROCEDURES OF GENERAL
APPLICABILITY
<TABLE>
<S> <C>
Price to Public: Each Note will be issued at 100% of principal amount,
unless otherwise determined by the Corporation.
Date of Issuance/ Each Note will be dated as of the date of its
Authentication: authentication by the Trustee. Each Note shall
also bear an original issue date (the "Original
Issue Date"). The Original Issue Date shall remain
the same for all Notes subsequently issued upon
transfer, exchange or substitution of an original
Note regardless of their dates of authentication.
</TABLE>
B-2
<PAGE> 37
<TABLE>
<S> <C>
Maturities: Each Note will mature on a Business Day (as defined
below) selected by the purchaser and agreed to by
the Corporation which is not less than nine months
nor more than thirty years from its Original Issue
Date; provided, however, that Notes bearing
interest at rates determined by reference to
selected indices ("Floating Rate Notes") will
mature on an Interest Payment Date.
Registration: Notes will be issued only in fully registered form.
Calculation of In the case of Fixed Rate Notes, interest (including
Interest: payments for partial periods) will be calculated
and paid on the basis of a 360-day year of twelve
30-day months. In the case of Floating Rate Notes,
interest will be calculated in the manner set forth
in the Prospectus Supplement.
Acceptance and The Corporation shall have the sole right to accept
Rejection of offers to purchase Notes from the Corporation and
Offers: may reject any such offer in whole or in part.
Each Agent shall communicate to the Corporation,
orally or in writing, each reasonable offer to
purchase Notes from the Corporation received by it.
Each Agent shall have the right, in its discretion
reasonably exercised, without notice to the
Corporation, to reject any offer to purchase Notes
through it in whole or in part.
Preparation of If any offer to purchase a Note is accepted by the
Pricing Corporation, the Corporation, with the approval of
Supplement:
</TABLE>
B-3
<PAGE> 38
<TABLE>
<S> <C>
the Agent which presented such offer (the "Presenting
Agent"), will prepare a Pricing Supplement (a
"Pricing Supplement") reflecting the terms of such
Note and file 10 Pricing Supplements relating to the
Notes and the plan of distribution thereof with the
Commission in accordance with Rule 424 under the
Securities Act of 1933 and will supply by next day
mail or telecopy at least one copy thereof (and
additional copies if requested) to the Presenting
Agent to arrive no later than 11:00 a.m. on the
Business Day following the trade date or as soon as
practicable thereafter under the circumstances. The
Presenting Agent will cause a Prospectus and Pricing
Supplement to be delivered to the purchaser of the
Note. Such Prospectus and Pricing Supplement will be
delivered to the Presenting Agent at the following
applicable address: If to Lehman Brothers Inc., by
telecopy to Lehman Brothers Inc. c/o ADP Prospectus
Services, 536 Broadhollow Road, Melville, New York
11797, Attention: Mike Ward, Telecopy: (516)
249-7942, Telephone: (516) 254-7106 and by hand to
Lehman Brothers Inc., Medium-Term Note Department, 3
World Financial Center, 9th Floor, New York, N.Y.
10285-0900, Attention: Brunnie Vazquez, Telephone:
(212) 526-8400; if to Goldman, Sachs & Co. by
telecopy and by hand to Goldman, Sachs & Co., 85
Broad Street, 26th Floor, New York, N.Y. 10004,
Attention: Karen Robertson, Telephone: (212)
902-1482, Telecopy: (212) 902-0658; and if any other
agent, at such address as they shall specify.
In each instance that a Pricing Supplement is
prepared, the Agents
</TABLE>
B-4
<PAGE> 39
<TABLE>
<S> <C>
will affix the Pricing Supplement to the Prospectus
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 of immediately available funds in U.S. dollars
by the Corporation in payment for a Note and the
authentication and delivery of such Note shall, with
respect to such Note, constitute "settlement". Offers
accepted by the Corporation will be settled from one to
five Business Days, or at a time as the purchaser and the
Corporation shall agree, pursuant to the timetable for
settlement set forth in Parts II and III hereof under
"Settlement Procedures" with respect to Book-Entry Notes
and Certificated Notes, respectively.
In the event of a purchase of Notes by any Agent as
principal, appropriate settlement details will be as agreed
between the Agent and the Corporation pursuant to the
applicable Terms Agreement. In the event of sales of
any Notes denominated in a foreign currency or currency
unit, reference is made to Section 14 of the Agency
Agreement regarding amendments to the Agency Agreement
(including these Administrative Procedures) for sales of
Notes so denominated.
Procedure for When a decision has been reached to: change the posted
Changing Rates interest rate, spread, the Specified Currency or any other
or other Variable variable term on any Notes being sold by the Corporation,
Terms: the Corporation will promptly advise the Agents and the
</TABLE>
B-5
<PAGE> 40
<TABLE>
<S> <C>
Agents will forthwith suspend solicitation of offers
to purchase such Notes. The Agents will telephone
the Corporation with recommendations as to the
changed interest rates or other variable terms. At
such time as the Corporation advises the Agents of
the new posted interest rates, spread or other
variable terms, the Agents may resume solicitation of
offers to purchase such Notes. Until such time only
"indications of interest" may be recorded.
Immediately after acceptance by the Corporation of an
offer to purchase at a new posted interest rate,
spread or new variable term, the Corporation, the
Presenting Agent and the Trustee shall follow the
procedures set forth under the applicable "Settlement
Procedures".
Suspension of The Corporation may instruct the Agents to suspend
Solicitation; solicitation of purchases at any time. Upon receipt of
Amendment or such instructions the Agents will forthwith suspend
Supplement: solicitation of offers to purchase from the Corporation
until such time as the Corporation has advised them that
solicitation of offers to purchase may be resumed. If the
Corporation decides to amend the Registration Statement
(including incorporating any documents by reference
therein) or supplement any of such documents (other than to
change posted interest rates, spreads or other variable
terms), it will notify the Agents and will furnish the
Agents and their counsel with copies of the amendment or
supplement in accordance with Section 4 of the Agency
Agreement. One copy of such filed document, along with a copy
</TABLE>
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<TABLE>
<S> <C>
of the cover letter sent to the Commission, will be
delivered or mailed to the Agents at the following
respective addresses: Lehman Brothers Inc.,
Medium-Term Note Department, 3 World Financial Center
(12th Floor), New York, N.Y. 10285-1200, Telecopy:
(212) 528-1718, Telephone: (212) 256-2040; and
Goldman, Sachs & Co., 85 Broad Street, 26th Floor,
New York, N.Y. 10004, Attention: Karen Robertson.
In the event that at the time the solicitation of offers to
purchase from the Corporation is suspended (other than to
change the posted interest rates, spreads or other variable
terms) there shall be any orders outstanding which have not
been settled, the Corporation will promptly advise the
Agents and the Trustee whether such orders may be settled
and whether copies of the Prospectus as theretofore amended
and/or supplemented as in effect at the time of the
suspension may be delivered in connection with the
settlement of such orders. The Corporation will have the
sole responsibility for such decision and for any
arrangements which may be made in the event that the
Corporation determines that such orders may not be settled
or that copies of such Prospectus may not be so delivered.
Delivery of A copy of the most recent Prospectus, Prospectus Supplement
Prospectus: and Pricing Supplement must accompany or precede the
earlier of (a) the written confirmation of a sale sent to a
customer or his agent and (b) the delivery of Notes to a
customer or his agent.
</TABLE>
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<TABLE>
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Authenticity of The Corporation will provide to the Trustee a list of the
Signatures: names of its representatives that are authorized to
communicate the purchase information and to confirm such
purchase information. The Trustee will provide to the
Corporation and the Agents a list of its representatives
who are authorized to take all necessary action to complete
the terms of the Notes and to otherwise complete the
procedures set forth herein that are applicable to the
Trustee, but the Agents will have no obligation or
liability to the Corporation or the Trustee in respect of
the authenticity of the signature of any officer, employee
or agent of the Corporation or the Trustee on any Note.
Documents Incorpo- The Corporation shall supply the Agents with an adequate
rated by supply of all documents incorporated by reference in the
Reference: Registration Statement.
Business Day: "Business Day" shall mean any day, other than a Saturday or
Sunday, that is neither a legal holiday nor a day on which
banking institutions are authorized or required by law or
regulation to close in New York, New York, or (i) with
respect to Notes denominated in a Foreign Currency, the
principal financial center of the country of the Foreign
Currency, (ii) with respect to Notes denominated in
European Currency Units, Brussels, Belgium, or (iii) with
respect to Notes which will bear interest based on a
specified percentage of London interbank offered quotations
("LIBOR"), London, England.
</TABLE>
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<TABLE>
<S> <C>
Advertising Costs: The Corporation will determine with the Agents the amount
and nature of advertising that may be appropriate in
offering the Notes. Advertising expenses incurred with the
consent of the Corporation will be paid by the Corporation.
Trustee Not To Nothing herein shall be deemed to require the Trustee to
Risk Funds: use or expend its own funds in connection with any payments
to the Corporation, the Agents or any purchaser, it being
understood by all parties that payments made by the Trustee
to the Corporation, the Agents or any purchaser shall be made
only to the extent that funds are provided to the Trustee for
such purpose.
</TABLE>
PART II: PROCEDURES FOR NOTES ISSUED
IN BOOK-ENTRY FORM
In connection with the qualification of Notes issued in
book-entry form for eligibility in the book-entry system maintained by DTC, the
Trustee will perform the custodial, document control and administrative
functions described below, in accordance with its respective obligations under a
Letter of Representations from the Corporation and the Trustee to DTC dated
[ ], 1996, and a Medium-Term Note Certificate Agreement dated
December 27, 1989 (the "Certificate Agreement"), between the Trustee and DTC,
and its obligations as a participant in DTC, including DTC's Same-Day Funds
Settlement System ("SDFS").
<TABLE>
<S> <C>
Issuance: All Fixed Rate Notes issued in book-entry form having the
same Original Issue Date, interest rate and Maturity Date,
and if a Currency Indexed Note, the same Specified
Currency, Indexed Currency and Base Exchange Rate and if a
Commodity Indexed Note,
</TABLE>
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<TABLE>
<S> <C>
the same comparable terms (collectively, the "Fixed
Rate Terms") will be represented initially by a
single global security in fully registered form
without coupons (each, a "Book-Entry Note"); and all
Floating Rate Notes issued in book-entry form having
the same Original Issue Date, base rate upon which
interest may be determined (each, a "Base Rate"),
which may be the Commercial Paper Rate, the Treasury
Rate, LIBOR, or any other rate set forth by the
Corporation, Initial Interest Rate, Index Maturity,
Spread or Spread Multiplier, if any, minimum interest
rate, if any, maximum interest rate, if any, and
Maturity Date, and if a Currency Indexed Note, the
same Specified Currency, Indexed Currency and Base
Exchange Rate and if a Commodity Indexed Note, the
same comparable terms (collectively, "Floating Rate
Terms") will be represented initially by a single
Book-Entry Note.
Each Book-Entry Note will be dated and issued as of the
date of its authentication by the Trustee. Each Book-
Entry Note will bear an Original Issue Date, which will be
(a) with respect to an original Book-Entry Note (or any
portion thereof), its Original Issue Date and (b) with
respect to any Book-Entry Note (or portion thereof) issued
subsequently upon exchange of a Book-Entry Note or in lieu
of a destroyed, lost or stolen Book-Entry Note, the most
recent Interest Payment Date to which interest has been
paid or duly provided for on the predecessor
</TABLE>
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<TABLE>
<S> <C>
Book-Entry Note or Notes (or if no such payment or
provision has been made, the Original Issue Date of
the predecessor Book-Entry Note or Notes),
regardless of the date of authentication of such
subsequently issued Book-Entry Note. No Book-Entry
Note shall represent any Note issued in certificated
form.
Identification: The Corporation has arranged with the CUSIP Service Bureau
of Standard & Poor's Corporation (the "CUSIP Service
Bureau") for the reservation of approximately 900 CUSIP
numbers which have been reserved for and which relate to
Book-Entry Notes and the Corporation has delivered to the
Trustee and DTC such list of such CUSIP numbers. The
Corporation will assign CUSIP numbers to Book-Entry Notes
as described below under Settlement Procedure B. DTC will
notify the CUSIP Service Bureau periodically of the CUSIP
numbers that the Corporation has assigned to Book-Entry
Notes. The Trustee will notify the Corporation at any
time when fewer than 100 of the reserved CUSIP numbers
remain unassigned to Book-Entry Notes and, if it deems
necessary, the Corporation will reserve additional CUSIP
numbers for assignment to Book-Entry Notes. Upon
obtaining such additional CUSIP numbers, the Corporation
will deliver a list of such additional numbers to the
Trustee and DTC. Book-Entry Notes having an aggregate
principal amount in excess of $150,000,000 and otherwise
required to be represented by the same Global Certificate
will instead be
</TABLE>
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<TABLE>
<S> <C>
represented by two or more Global Certificates which
shall all be assigned the same CUSIP number.
Registration: Each Book-Entry Note will be registered in the name of
Cede & Co., as nominee for DTC, on the register maintained
by the Trustee under the Indenture. The beneficial owner
of a Note issued in book-entry form (or one or more
indirect participants in DTC designated by such
owner) will designate one or more participants in DTC
(with respect to such Note issued in book-entry form,
the "Participants") to act as agent for such
beneficial owner in connection with the book-entry
system maintained by DTC, and DTC will record in
book- entry form, in accordance with instructions
provided by such Participants, a credit balance with
respect to such Note issued in book-entry form in the
account of such Participants. The ownership interest
of such beneficial owner in such Note issued in
book-entry form will be recorded through the records
of such Participants or through the separate records
of such Participants and one or more indirect
participants in DTC.
Transfers: Transfers of a Book-Entry Note will be accomplished by
book entries made by DTC and, in turn, by Participants
(and in certain cases, one or more indirect participants
in DTC) acting on behalf of beneficial transferors and
transferees of such Book-Entry Note.
</TABLE>
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Exchanges: The Trustee may deliver to DTC and the CUSIP Service
Bureau at any time a written notice specifying (a)
the CUSIP numbers of two or more Book-Entry Notes
outstanding on such date that represent Book-Entry
Notes having the same Fixed Rate Terms or Floating
Rate Terms, as the case may be (other than Original
Issue Dates), and for which interest has been paid to
the same date; (b) a date, occurring at least 30 days
after such written notice is delivered and at least
30 days before the next Interest Payment Date for the
related Notes issued in book-entry form, on which
such Book-Entry Notes shall be exchanged for a single
replacement Book-Entry Note; and (c) a new CUSIP
number, obtained from the Corporation, to be assigned
to such replacement Book-Entry Note. Upon receipt of
such a notice, DTC will send to its Participants
(including the Trustee) a written reorganization
notice to the effect that such exchange will occur on
such date. Prior to the specified exchange date, the
Trustee will deliver to the CUSIP Service Bureau
written notice setting forth such exchange date and
the new CUSIP number and stating that, as of such
exchange date, the CUSIP numbers of the Book-Entry
Notes to be exchanged will no longer be valid. On
the specified exchange date, the Trustee will
exchange such Book-Entry Notes for a single
Book-Entry Note bearing the new CUSIP number and the
CUSIP numbers of the exchanged Book-Entry Notes will,
in accordance with CUSIP Service Bureau procedures,
be canceled and not immediately
</TABLE>
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<TABLE>
<S> <C>
reassigned. Notwithstanding the foregoing, if the
Book-Entry Notes to be exchanged exceed $150,000,000
in aggregate principal amount, one replacement
Book-Entry Note will be authenticated and issued to
represent $150,000,000 of principal amount of the
exchanged Book-Entry Notes and an additional
Book-Entry Note or Notes will be authenticated and
issued to represent any remaining principal amount of
such Book-Entry Notes (see "Denominations" below).
Denominations: All Notes issued in book-entry form will be denominated in
U.S. dollars. Notes issued in book-entry form will be
issued in denominations of $100,000 and any larger
denomination which is an integral multiple of $1,000.
Book-Entry Notes will be denominated in principal amounts
not in excess of $150,000,000. If one or more Notes
issued in book-entry form having an aggregate principal
amount in excess of $150,000,000 would, but for the
preceding sentence, be represented by a single Book-Entry
Note, then one Book-Entry Note will be issued to represent
$150,000,000 principal amount of such Note or Notes issued
in book-entry form and an additional Book-Entry Note or
Notes will be issued to represent any remaining principal
amount of such Note or Notes issued in book-entry form.
In such a case, each of the Book-Entry Notes representing
such Note or Notes issued in book-entry form shall be
assigned the same CUSIP number.
</TABLE>
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Interest: General. Interest, if any, on each Note issued in
book-entry form will accrue from the Original Issue
Date for the first interest period or the last date
to which interest has been paid, if any, for each
subsequent interest period. Each payment of interest
on a Note issued in book-entry form will include
interest accrued through the day preceding, as the
case may be, the Interest Payment Date (provided that
in the case of Floating Rate Notes which reset daily
or weekly, interest payments will include interest
accrued to but including the Record Date immediately
preceding the Interest Payment Date), or to but
excluding the Maturity Date (each Maturity Date is
referred to herein as "Maturity"). Interest payable
at Maturity of a Note issued in book-entry form will
be payable to the person to whom the principal of
such Note is payable. DTC will arrange for each
pending deposit message described under Settlement
Procedure C below to be transmitted to Standard &
Poor's, which will use the information in the message
to include certain terms of the related Book-Entry
Note in the appropriate daily bond report published
by Standard & Poor's Corporation.
Record Dates. The record date (the "Record Date") with
respect to any Interest Payment Date shall be the date 15
calendar days (whether or not a Business Day) preceding
such Interest Payment Date.
Interest Payment Dates. Interest payments will be made on
each
</TABLE>
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<TABLE>
<S> <C>
Interest Payment Date commencing with the first
Interest Payment Date following the Original Issue Date;
provided, however, the first payment of interest on any
Book-Entry Note originally issued between a Record Date
and an Interest Payment Date will occur on the Interest
Payment Date following the next Record Date.
If an Interest Payment Date with respect to any Floating
Rate Note issued in book-entry form would otherwise fall
on a day that is not a Business Day with respect to such
Note, such Interest Payment Date will be the following day
that is a Business Day with respect to such Note, except
that in the case of a LIBOR Note, if such day falls in the
next calendar month, such Interest Payment Date will be
the preceding day that is a London Business Day.
Fixed Rate Notes. Interest payments on Fixed Rate Notes
issued in book-entry form will be made semiannually on
June 15 and December 15 of each year unless otherwise
specified in such Note, and at Maturity.
Floating Rate Notes. Interest payments on Floating Rate
Notes issued in book-entry form will be made as specified
in the Floating Rate Note.
Notice of Interest Payments and Record Dates. On the
first Business Day of January, April, July and October of
each year, the Trustee will deliver to the Corporation and
DTC a written list of Record Dates and Interest
</TABLE>
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<TABLE>
<S> <C>
Payment Dates that will occur during the six-month period
beginning on such first Business Day with respect to
Floating Rate Notes issued in book-entry form. Promptly
after each Interest Determination Date for Floating Rate
Notes issued in book-entry form, the Trustee will notify
Standard & Poor's Corporation of the interest rates
determined on such Interest Determination Date.
Payments of Payments of Interest Only. Promptly after each Record
Principal Date, the Trustee will deliver to the Corporation and DTC
and Interest: a written notice specifying by CUSIP number the amount of
interest to be paid on each Book-Entry Note on the following
Interest Payment Date (other than an Interest Payment Date
coinciding with Maturity) and the total of such amounts.
DTC will confirm the amount payable on each Book-Entry Note
on such Interest Payment Date by reference to the daily bond
reports published by Standard & Poor's Corporation. On
such Interest Payment Date, the Corporation will pay to
the Trustee, and the Trustee in turn will pay to DTC, such
total amount of interest due (other than at Maturity), at
the times and in the manner set forth below under "Manner
of Payment".
Payments at Maturity. On or about the first Business Day
of each month, the Trustee will deliver to the Corporation
and DTC a written list of principal, interest and premium,
if any, to be paid on each Book-Entry Note maturing either
at the Maturity Date or on a Redemption Date in the
following
</TABLE>
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<TABLE>
<S> <C>
month. The Trustee, the Corporation and DTC will
confirm the amounts of such principal and interest
payments with respect to a Book-Entry Note on or
about the fifth Business Day preceding the Maturity
of such Book-Entry Note. At such Maturity, the
Corporation will pay to the Trustee, and the Trustee
in turn will pay to DTC, the principal amount of such
Note, together with interest and premium, if any, due
at such Maturity, at the times and in the manner set
forth below under "Manner of Payment". If any
Maturity of a Book-Entry Note is not a Business Day,
the payment due on such day shall be made on the next
succeeding Business Day and no interest shall accrue
on such payment for the period from and after such
Maturity. Promptly after payment to DTC of the
principal, interest and premium, if any, due at the
Maturity of such Book-Entry Note, the Trustee will
cancel such Book-Entry Note and deliver it to the
Corporation with an appropriate debit advice. On the
first Business Day of each month, the Trustee will
deliver to the Corporation a written statement
indicating the total principal amount of outstanding
Book-Entry Notes as of the immediately preceding
Business Day.
Manner of Payment. The total amount of any principal,
premium, if any, and interest due on Book-Entry Notes on
any Interest Payment Date or at Maturity shall be paid by
the Corporation to the Trustee in funds available for use
by the Trustee as of 9:30 a.m.,
</TABLE>
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<TABLE>
<S> <C>
New York City time, on such date. The Corporation
will make such payment on such Book-Entry Notes by
instructing the Trustee to withdraw funds from an
account maintained by the Corporation at the Trustee.
The Corporation will confirm such instructions in
writing to the Trustee. Prior to 10:00 a.m., New
York City time, on such date or as soon as possible
thereafter, the Trustee will pay by separate wire
transfer (using Fedwire message entry instructions in
a form previously specified by DTC) to an account at
the Federal Reserve Bank of New York previously
specified by DTC, in funds available for immediate
use by DTC, each payment of interest, principal and
premium, if any, due on a Book-Entry Note on such date.
Thereafter on such date, DTC will pay, in accordance
with its SDFS operating procedures then in effect,
such amounts in funds available for immediate use to
the respective Participants in whose names such Notes
are recorded in the book-entry system maintained by
DTC. Neither the Corporation nor the Trustee shall
have any responsibility or liability for the payment
by DTC of the principal of, or interest on, the
Book-Entry Notes to such Participants.
Withholding Taxes. The amount of any taxes required under
applicable law to be withheld from any interest payment on
a Note will be determined and withheld by the Participant,
indirect participant in DTC or other person responsible
for forwarding
</TABLE>
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<TABLE>
<S> <C>
payments and materials directly to the beneficial
owner of such Note.
Settlement Settlement Procedures with regard to each Note in book-
Procedures: entry form sold by each Agent, as agent of the
Corporation, will be as follows:
A. The Presenting Agent will advise the Corporation in
writing, by telex or facsimile, or by telephone
(with written confirmation on the next Business Day)
of the following Settlement information:
1. Taxpayer identification number of the
purchaser.
2. Principal amount of the Note.
3.1 Fixed Rate Notes:
(a) interest rate.
3.2 Floating Rate Notes:
(a) base rate;
(b) initial interest rate;
(c) spread or spread multiplier,
if any;
(d) interest reset dates;
(e) reset period;
(f) interest payment dates;
(g) index maturity;
(h) calculation agent;
(i) maximum interest rate, if any;
(j) minimum interest rate, if any;
and
(k) interest determination dates.
</TABLE>
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<TABLE>
<S> <C>
3.3 Currency Indexed Notes:
(a) specified currency
(b) indexed currency
(c) face amount
(d) base exchange rate
(e) determination agent
(f) reference dealers
(g) base interest rate, if any
3.4 Commodity Indexed Note:
(a) applicable terms
4. Price to public of the Note.
5. Trade date.
6. Settlement Date.
7. Maturity Date.
8. Redemption or repayment provisions, if any.
9. Net proceeds to the Corporation.
10. Agent's commission (to be paid in the form
of a discount from the proceeds remitted to
the Corporation upon Settlement).
11. If applicable, total amount of original
issue discount ("OID"), yield to maturity
and the initial accrual period OID.
12. Any other provisions.
B. The Corporation will assign a CUSIP number to the
Book-Entry Note representing such Note and
</TABLE>
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<TABLE>
<S> <C>
then advise the Trustee by electronic transmission of
the above settlement information received from the
Presenting Agent, such CUSIP number and the name of
the Agent.
C. The Trustee will communicate to DTC and the Agent
through DTC's Participant Terminal System, a pending
deposit message specifying the following settlement
information:
1. The information set forth in Settlement
Procedure A.
2. Identification numbers of the participant
accounts maintained by DTC on behalf of the
Trustee and the Agent.
3. Identification as a Fixed Rate Book-Entry
Note or a Floating Rate Book-Entry Note.
4. Initial Interest Payment Date for such Note,
number of days by which such date succeeds
the related record date for DTC purposes
(or, in the case of Floating Rate Notes
which reset daily or weekly, the date five
calendar days preceding the Interest Payment
Date) and, if then calculable, the amount of
interest payable on such Interest Payment
Date (which amount shall have been confirmed
by the Trustee).
</TABLE>
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<S> <C>
5. CUSIP number of the Book-Entry Note
representing such Note.
6. Whether such Book-Entry Note represents any
other Notes issued or to be issued in book-
entry form.
D. The Corporation will provide to the Trustee the
above Settlement information received from the Agent
and shall cause the Trustee to issue and
authenticate a Book-Entry Note representing such
Note in a form that has been approved by the
Corporation, the Agents and the Trustee.
E. The Trustee will authenticate the Book-Entry Note
representing such Note.
F. DTC will credit such Note to the participant account
of the Trustee maintained by DTC.
G. The Trustee will enter an SDFS deliver order through
DTC's Participant Terminal System instructing DTC
(i) to debit such Note to the Trustee's participant
account and credit such Note to the participant
account of the Presenting Agent maintained by DTC
and (ii) to debit the settlement account of the
Presenting Agent and credit the settlement account
of the Trustee maintained by DTC, in an amount equal
to the price of such Note less such Agent's
commission. Any entry of such a deliver order shall
be deemed to constitute a representation and
warranty by the Trustee to
</TABLE>
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<TABLE>
<S> <C>
DTC that (i) the Book-Entry Note representing
such Note has been issued and authenticated and
(ii) the Trustee is holding such Book-Entry
Note pursuant to the Medium-Term Note
Certificate Agreement between the Trustee and
DTC.
H. The Presenting Agent will enter an SDFS deliver
order through DTC's Participant Terminal System
instructing DTC (i) to debit such Note to the
Presenting Agent's participant account and credit
such Note to the participant account of the
Participants maintained by DTC and (ii) to debit the
settlement accounts of such Participants and credit
the settlement account of the Presenting Agent
maintained by DTC, in an amount equal to the initial
public offering price of such Note.
I. Transfers of funds in accordance with SDFS deliver
orders described in Settlement Procedures G and H
will be settled in accordance with SDFS operating
procedures in effect on the Settlement Date.
J. The Trustee will credit to an account of the
Corporation maintained at the Trustee funds
available for immediate use in the amount
transferred to the Trustee in accordance with
Settlement Procedure G.
K. The Trustee will send a copy of the Book-Entry Note
by first class mail to the Corporation together with
a statement
</TABLE>
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<TABLE>
<S> <C>
setting forth the principal amount of
Notes outstanding as of the related Settlement Date
after giving effect to such transaction and all
other offers to purchase Notes of which the
Corporation has advised the Trustee but which have
not yet been settled.
L. The Agent will confirm the purchase of such Note to
the purchaser either by transmitting to the
Participant with respect to such Note a confirmation
order through DTC's Participant Terminal System or
by mailing a written confirmation to such purchaser.
Settlement Proce- For orders of Notes accepted by the Corporation,
dures Timetable: Settlement Procedures "A" through "L" set forth above
shall be completed as soon as possible but not later than
the respective times (New York City time) set forth below:
Settlement
Procedure Time
---------- ----
A-B 11:00 a.m. on the trade date
C 2:00 p.m. on the trade date
D 3:00 p.m. on the Business
Day before Settlement Date
E 9:00 a.m. on Settlement
Date
F 10:00 a.m. on Settlement
Date
G-H No later than 2:00 p.m. on
Settlement Date
I 4:45 p.m. on Settlement
Date
J-L 5:00 p.m. on Settlement
Date
If a sale is to be settled more
</TABLE>
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<TABLE>
<CAPTION>
<S> <C>
than one Business Day after the sale date,
Settlement Procedures A, B, and C may, if
necessary, be completed at any time prior to the
specified times on the first Business Day after
such sale date. In connection with a sale which
is to be settled more than one Business Day
after the trade date, if the initial interest
rate for a Floating Rate Note is not known at
the time that Settlement Procedure A is
completed, Settlement Procedures B and C shall
be completed as soon as such rates have been
determined, but no later than 11:00 a.m. and
2:00 p.m., New York City time, respectively, on
the second Business Day before the Settlement
Date. Settlement Procedure I is subject to
extension in accordance with any extension of
Fedwire closing deadlines and in the other
events specified in the SDFS operating
procedures in effect on the Settlement Date.
If settlement of a Note issued in book-entry
form is rescheduled or canceled, the Trustee
will deliver to DTC, through DTC's Participant
Terminal System, a cancelation message to such
effect by no later than 2:00 p.m., New York City
time, on the Business Day immediately preceding
the scheduled Settlement Date.
</TABLE>
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<S> <C>
Failure to Settle: If the Trustee fails to enter an SDFS deliver order, with
respect to a Book-Entry Note issued in book-entry form
pursuant to Settlement Procedure G, 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 participant account of the
Trustee maintained at DTC. DTC will process the
withdrawal message, provided that such participant account
contains a principal amount of the Book-Entry Note
representing such Note that is at least equal to the
principal amount to be debited. If withdrawal messages
are processed with respect to all the Notes represented by
a Book-Entry Note, the Trustee will mark such Book-Entry
Note "canceled", make appropriate entries in its records
and send such canceled Book-Entry Note to the Corporation.
The CUSIP number assigned to such Book-Entry Note shall,
in accordance with CUSIP Service Bureau procedures, be
canceled and not immediately reassigned. If withdrawal
messages are processed with respect to a portion of the
Notes represented by a Book-Entry Note, the Trustee will
exchange such Book-Entry Note for two Book-Entry Notes,
one of which shall represent the Book-Entry Notes for which
withdrawal messages are processed and shall be canceled
immediately after issuance, and the other of which shall
represent the other Notes previously represented by the
Surrendered Book-Entry Note and
</TABLE>
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<TABLE>
<S> <C>
shall bear the CUSIP number of the surrendered
Book-Entry Note. If the purchase price for any Book-Entry
Note is not timely paid to the Participants with respect
to such Note by the beneficial purchaser thereof (or a
person, including an indirect participant in DTC, acting
on behalf of such purchaser), such Participants and, in
turn, the related Agent may enter SDFS deliver orders
through DTC's Participant Terminal System reversing the
orders entered pursuant to Settlement Procedures G and H,
respectively. Thereafter, the Trustee will deliver the
withdrawal message and take the related actions described
in the preceding paragraph. If such failure shall have
occurred for any reason other than default by the
applicable Agent to perform its obligations hereunder or
under the Distribution Agreement, the Corporation will
reimburse such Agent on an equitable basis for its loss of
the use of funds during the period when the funds were
credited to the account of the Corporation. An Agent will
not be entitled to any commission with respect to any Note
which the purchaser does not accept or make payment for.
Notwithstanding the foregoing, upon any failure to settle
with respect to a Book-Entry Note, DTC may take any actions
in accordance with its SDFS operating procedures then in
effect. In the event of a failure to settle with respect to
a Note that was to have been represented by a Book-Entry Note
also representing by a Book-Entry Note also representing other
Notes, the Trustee will provide, in accord-
</TABLE>
B-28
<PAGE> 63
<TABLE>
<S> <C>
ance with Settlement Procedure E, for the authentication and
issuance of a Book-Entry Note representing such remaining
Notes and will make appropriate entries in its records.
</TABLE>
PART III: PROCEDURES FOR NOTES ISSUED
IN CERTIFICATED FORM
<TABLE>
<S> <C>
Denominations: The Notes will be issued in denominations of U.S. $100,000
and integral multiples of U.S. $1,000 in excess thereof,
or, in the case of Notes denominated in a Specified
Currency other than U.S. dollars, the denominations set
forth in the Prospectus Supplement and the applicable
Pricing Supplement.
Interest: Each Note will bear interest in accordance with its terms.
Interest will begin to accrue on the original issue date
of a Note for the first interest period and on the most
recent interest payment date to which interest has been
paid for all subsequent interest periods. Each payment of
interest shall include interest accrued to, but excluding,
the date of such payment (provided that in the case of
Floating Rate Notes which reset daily or weekly, interest
payments will include interest accrued to but including the
Record Date immediately preceding the Interest Payment Date),
or to but excluding the Maturity Date. Interest payments
in respect of Fixed Rate Notes will be made semiannually
on June 15 and December 15 of each year unless otherwise
specified in such
</TABLE>
B-29
<PAGE> 64
<TABLE>
<S> <C>
Note, and at maturity. However, the first payment of interest
on any Note issued between a Record Date and an Interest
Payment Date will be made on the Interest Payment Date
following the next succeeding Record Date. The record date
(the "Record Date") for any Interest Payment Date shall be
the date (whether or not a Business Day) 15 calendar days
immediately preceding such Interest Payment Date.
Interest at maturity will be payable to the person to whom
the principal is payable.
For additional special provisions relating to Floating Rate
Notes, see the Prospectus Supplement.
Payments of Princi- Upon presentment and delivery of the Note, the Trustee
pal and Interest: will pay the principal amount of each Note at maturity and
the final installment of interest in immediately available
funds. All interest payments on a Note, other than
interest due at maturity, will be made by check drawn on
the Trustee and mailed by the Trustee to the person
entitled thereto as provided in the Note. However,
holders of Notes of like tenor and terms in aggregate
principal amount exceeding U.S. $5 million or the
equivalent thereof in a Specified Currency shall be
entitled to receive payments of interest, other than at
maturity, by wire transfer of immediately available funds
to an account maintained by such holder with a bank located
in the United States for payments in U.S. Dollars or the
country of the Specified Currency for other payments,
provided that appropriate wire
</TABLE>
B-30
<PAGE> 65
<TABLE>
<S> <C>
transfer instructions have been received in writing by
the Trustee not less than 15 calendar days prior to the
applicable Interest Payment Date. Any payment of principal
or interest required to be made on an Interest Payment Date
or at maturity of a Note which is not a Business Day need
not be made on such day, but may be made on the next
succeeding Business Day with the same force and effect as
if made on the Interest Payment Date or at maturity, as
the case may be, and no interest shall accrue for the
period from and after such Interest Payment Date or
maturity.
The Trustee will provide monthly to the Corporation a list
of the principal and interest (and premium, if any) in
each currency to be paid on Notes maturing in the next
succeeding month. The Trustee will be responsible for
withholding taxes on interest paid as required by
applicable law.
Notes presented to the Trustee at maturity for payment
will be canceled by the Trustee. All canceled Notes held
by the Trustee shall be destroyed, and the Trustee shall
furnish to the Corporation a certificate with respect to
such destruction.
</TABLE>
B-31
<PAGE> 66
<TABLE>
<S> <C>
Settlement Proce- Settlement Procedures with regard to each Note purchased
dures: through any Agent, as agent, shall be as follows:
A. The Presenting Agent will advise the Corporation
in writing, by telex or facsimile, or by telephone (with
written confirmation on the next Business Day) of the
following Settlement information with regard to each Note:
1. Exact name in which the Note is to be registered
(the "Registered Owner").
2. Exact address or addresses of the Registered Owner
for delivery, notices and payments of principal and
interest.
3. Taxpayer identification number of the Registered
Owner.
4. Principal amount of the Note.
5. Denomination of the Note.
6.1 Fixed Rate Notes:
(a) interest rate.
6.2 Floating Rate Notes:
(a) base rate;
(b) initial interest rate;
(c) spread or spread multiplier, if any;
(d) interest reset dates;
(e) reset period;
(f) interest payment dates;
(g) index maturity;
(h) calculation agent;
</TABLE>
B-32
<PAGE> 67
<TABLE>
<S> <C>
(i) maximum interest rates, if
any; and
(j) minimum interest rate, if
any; and
(k) interest determination dates.
6.3 Currency Indexed Notes:
(a) specified currency;
(b) indexed currency;
(c) face amount;
(d) base exchange rate;
(e) determination agent;
(f) reference dealers; and
(g) base interest rate, if any.
6.4 Commodity Indexed Note:
(a) applicable terms.
7. Price to public of the Note (including currency).
8. Settlement Date.
9. Maturity Date.
10. Redemption or repayment provisions, if any.
11. Net proceeds to the Corporation.
12. Agent's commission (to be paid in the form of a
discount from the proceeds remitted to the
Corporation upon Settlement).
13. If applicable, total amount of original issue
discount ("OID"), yield to maturity and initial
accrual period OID.
14. Any other provisions.
</TABLE>
B-33
<PAGE> 68
<TABLE>
<S> <C>
B. The Corporation shall provide to the Trustee the above
Settlement information received from the Agent and shall
cause the Trustee to issue, authenticate and deliver the
Notes. The Corporation also shall provide to the Trustee
and/or Agent a copy of the applicable Pricing Supplement.
C. The Trustee will complete the preprinted 4-ply Note
packet containing the following documents in forms
approved by the Corporation, the Presenting Agent and the
Trustee:
1. Note with Agent's customer confirmation.
2. Stub I - for Trustee.
3. Stub 2 - for Agent.
4. Stub 3 - for the Corporation.
D. With respect to each trade, the Trustee will deliver
the Notes and Stub 2 thereof to the Presenting Agent at
the following applicable address: Lehman [
] and
Goldman, Sachs & Co., 85 Broad Street, 6th Floor, New York,
N.Y. 10004, Attention: Michael Mosely. The Trustee will
keep Stub 1. The Presenting Agent will acknowledge receipt
of the Note through a broker's receipt and will keep Stub 2.
Delivery of the Note will be made only against such
acknowledgment of receipt. Upon determination that the
Note has been authorized, delivered and
</TABLE>
B-34
<PAGE> 69
<TABLE>
<S> <C>
completed as aforementioned, the Presenting Agent will
wire in immediately available funds the net proceeds of
the Note after deduction of its applicable commission
to the Corporation pursuant to standard wire instructions
given by the Corporation.
E. The Presenting Agent will deliver the Note (with
confirmations), as well as a copy of the Prospectus and
any applicable Prospectus Supplement or Supplements
received from the Trustee to the purchaser against payment
in immediately available funds.
F. The Trustee will send Stub 3 to the Corporation.
Settlement Pro- For offers accepted by the Corporation, Settlement
cedures Timetable: Procedures "A" through "G" set forth above shall be
completed on or before the respective times set forth
below:
</TABLE>
<TABLE>
<CAPTION>
Settlement
Procedure Time
--------- ----
<S> <C>
A-B 3:00 p.m. on Business
Day prior to settlement
C-D 2:15 p.m. on day of
settlement
E 3:00 p.m. on day of
settlement
F 5:00 p.m. on day of
settlement
</TABLE>
B-35
<PAGE> 70
<TABLE>
<S> <C>
Failure to Settle: In the event that a purchaser of a Note from the
Corporation shall either fail to accept delivery of or
make payment for a Note on the date fixed for settlement,
the Presenting Agent will forthwith notify the Trustee and
the Corporation by telephone, confirmed in writing, and
return the Note to the Trustee.
The Trustee, upon receipt of the Note from the Agent, will
immediately advise the Corporation and the Corporation
will promptly arrange to credit the account of the
Presenting Agent in an amount of immediately available
funds equal to the amount previously paid by such Agent in
settlement for the Note. Such credits will be made on the
settlement date if possible, and in any event not later
than the Business Day following the settlement date;
provided that the Corporation has received notice on the
same day. If such failure shall have occurred for any
reason other than failure by such Agent to perform its
obligations hereunder or under the Agency Agreement, the
Corporation will reimburse such Agent on an equitable
basis for its loss of the use of funds during the period
when the funds were credited to the account of the
Corporation. Immediately upon receipt of the Note in
respect of which the failure occurred, the Trustee will
cancel and destroy the Note, make appropriate entries in
its records to reflect the fact that the Note was never
issued, and accordingly notify in writing the Corporation.
An Agent will not be entitled to any commission
</TABLE>
B-36
<PAGE> 71
<TABLE>
<S> <C>
with respect to any Note which the purchaser
does not accept or make payment for.
</TABLE>
B-37
<PAGE> 72
EXHIBIT C
TERMS AGREEMENT
AIR PRODUCTS AND CHEMICALS, INC.
7201 Hamilton Boulevard
Allentown, Pennsylvania 18195
Attention: [Treasurer]
The undersigned agrees to purchase the following principal amount of
the Notes described in the Agency Agreement dated [ ], 1996 (as it may be
supplemented or amended from time to time, the "Agency Agreement") (all
capitalized terms used but not defined herein, shall have the meaning specified
in the Agency Agreement):
<TABLE>
<S> <C>
Aggregate Principal Amount: [$] ___________________
Currency: ___________________
Maturity Date: ___________________
Interest Rate: ___%
Interest Payment Dates: ___________________
Discount or Commission ___%
Aggregate Price to be ___% of principal amount
paid to Company
(in immediately
available funds): [$] ____________________
Settlement Date: ____________________
Other Terms: ____________________
</TABLE>
[In the case of Notes issued in a foreign currency or currency unit,
unless otherwise specified below, settlement and payments of principal and
interest will be in U.S. dollars based on the highest bid quotation in The
City of New York received by the Exchange Rate Agent at approximately
11:00 a.m., New York City time, on the second Business Day preceding the
applicable payment date from three recognized foreign exchange dealers (one of
which may be the Exchange Rate Agent (as defined in the Indenture) for the
purchase by the quoting dealer of the Specified Currency payable to all holders
of Notes denominated in such Specified Currency electing to receive U.S. dollar
payments and at which the applicable dealer commits to execute a contract. If
such bid quotations are not available, payments will be made in the Specified
Currency.)]
C-1
<PAGE> 73
Our obligations to purchase Notes hereunder is subject to the
continued accuracy of your representations and warranties contained in
the Agency Agreement and to your performance and observance of all applicable
covenants and agreements contained therein, including, without limitation,
your obligations pursuant to Section 11 thereof.
[Our obligation hereunder is subject to the further conditions that
we shall receive (a) the opinion required to be delivered pursuant to Sections
7(f) of the Agency Agreement, (b) the certificate required to be delivered
pursuant to Section 7(f) of the Agency Agreement, in each case dated as of the
above Settlement Date and [Insert other conditions as appropriate].]
In further consideration of our agreement hereunder, you agree that
between the date hereof and the above Settlement Date, you will not
offer or sell, or enter into any agreement to sell, any debt securities of the
Corporation, other than borrowings under your revolving credit agreements and
lines of credit, the private placement of securities and issuances of your
commercial paper.
We may terminate this Agreement, immediately upon notice to you, at
any time prior to the Settlement Date, if any of the conditions
specified in Section 7(b) of the Agency Agreement are not satisfied. In the
event of such termination, no party shall have any liability to the other party
hereto, except as provided in Sections 5, 11 and 16 of the Agency Agreement.
C-2
<PAGE> 74
This Agreement shall be governed by and construed in accordance with
the laws of New York.
LEHMAN BROTHERS INC.
By
--------------------
(Title)
GOLDMAN, SACHS & CO.
By
--------------------
(Title)
Accepted:
AIR PRODUCTS AND CHEMICALS, INC.
By
------------------------
(Title)
C-3
<PAGE> 75
EXHIBIT D
FOREIGN CURRENCY AMENDMENT NO. ______________
TO AGENCY AGREEMENT, DATED [ ], [ ]
AS AMENDED
[Insert Title of Foreign Currency]
The undersigned hereby agree that for the purposes of the issue and
sale of Notes denominated in [title of currency or currency unit] (the
"Applicable Foreign Currency") pursuant to the Agency Agreement, dated [ ],
1996, as it may be amended (the "Agency Agreement"), the following additions
and modifications shall be made to the Agency Agreement. The additions and
modifications adopted hereby shall be of the same effect for the sale under the
Agency Agreement of all Notes denominated in the Applicable Foreign Currency,
whether offered on an agency or principal basis, but shall be of no effect with
respect to Notes denominated in any currency or currency unit other than the
Applicable Foreign Currency.
Except as otherwise expressly provided herein, all terms used
herein which are defined in the Agency Agreement shall have the same meanings
as in the Agency Agreement. The terms Agent or Agents, as used in the Agency
Agreement, shall be deemed to refer only to the undersigned Agents for purposes
of this Amendment.
[Insert appropriate additions and modifications to the Agency
Agreement, for example, to opinions of counsel, conditions to obligations and
settlement procedures, etc.]
,
- -------- ----
AIR PRODUCTS AND CHEMICALS, INC.
By
-----------------------
Name:
Title:
D-1
<PAGE> 76
LEHMAN BROTHERS INC.
By
--------------------
Name:
(Title)
GOLDMAN, SACHS & CO.
By
--------------------
Name:
Title:
D-2
<PAGE> 1
[FORM OF FACE OF NOTE]
AIR PRODUCTS AND CHEMICALS, INC.
Medium-Term Note, Series F
Due from 9 Months to 30 Years from Date of Issue
(Fixed Rate)
Registered Principal Amount
No. FX- CUSIP
Global Note: __ Yes __ No
Depositary:
[Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to the Issuer
or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or such other name as
is requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof,
Cede & Co., has an interest herein.]
[THIS SECURITY IS A GLOBAL SECURITY AS REFERRED TO IN THE INDENTURE
HEREINAFTER REFERENCED. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART
FOR THE INDIVIDUAL SECURITIES REPRESENTED HEREBY, THIS GLOBAL SECURITY MAY NOT
BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.]
IF APPLICABLE THE "TOTAL AMOUNT OF OID," "YIELD TO MATURITY" AND "INITIAL
ACCRUAL PERIOD OID" (COMPUTED UNDER THE APPROXIMATE METHOD) BELOW WILL BE
COMPLETED SOLELY FOR THE PURPOSES OF APPLYING THE FEDERAL INCOME TAX ORIGINAL
ISSUE DISCOUNT ("OID") RULES.
Issue Price: Record Dates:
Interest Rate: Initial Accrual Period OID:
Interest Payment Dates: Initial Redemption Date:
Original Issue Date: Repayment Option Period(s):
Maturity Date: Specified Currency:
Repayment Date(s): U.S. Dollars [ ]
Total Amount of OID: Other: _______________
Yield to Maturity: U.S. Dollar Payments Option:
If applicable as described above, the Optional Redemption Price
initially shall be ________% of the principal amount of this Note to be
redeemed and shall decline at each anniversary of the Initial Redemption Date
by ______% of
1
<PAGE> 2
the principal amount to be redeemed until the Optional Redemption
Price is 100% of such principal amount, together with interest thereon to the
date fixed for redemption.
AIR PRODUCTS AND CHEMICALS, INC., a Delaware corporation (the
"Issuer"), for value received, hereby promises to pay to
, or registered assigns, the principal sum of
PRINCIPAL AMOUNT
on the Maturity Date specified above or upon earlier redemption or repayment at
the Corporate Trust Office of the Trustee in the Borough of Manhattan, The City
of New York, State of New York, or such other location or locations as may be
provided for pursuant to the Indenture referred to herein, in such coin,
currency or currency unit specified above as at the time of payment shall be
legal tender for the payment of public and private debts, and to pay interest
semiannually on each Interest Payment Date in each year and on the Maturity
Date or upon earlier redemption or repayment; commencing with the first
Interest Payment Date next succeeding the Original Issue Date specified above
on said principal sum at the Interest Rate specified above from the most recent
date to which interest has been paid or duly provided for, or, if no interest
has been paid or duly provided for, from the Original Issue Date, until the
principal hereof becomes due and payable; provided, however, that any payment
of principal or interest to be made on an Interest Payment Date, on the
Maturity Date, on a date fixed for redemption or on a Repayment Date which is
not a Business Day (as hereinafter defined) shall be made on the next succeeding
Business Day with the same force and effect as if made on the Interest Payment
Date, on the Maturity Date, on the date fixed for redemption or on the
Repayment Date, as the case may be, and no additional interest shall accrue as
a result of such delayed payment. For purposes of this Note, "Business Day"
means any day, other than a Saturday or Sunday, that is neither a legal holiday
nor a day on which banking institutions are authorized or required by law or
regulation to close in New York, New York, or, if this Note is denominated in a
Specified Currency other than U.S. Dollars,
___________________________________________________________
Principal Financial Center of Country of Specified Currency
or, if this Note is denominated in European Currency Units, Brussels, Belgium.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will be paid to the person in whose name this Note (or one
or more predecessor Notes) is registered at the close of business on the Record
Date (whether or not a Business Day) immediately preceding such Interest Payment
Date and interest payable on the Maturity Date or upon earlier redemption or
repayment will be payable to the person to whom principal is payable, except
that, if this Note is issued between a Record Date and the initial Interest
Payment Date relating to such Record Date, interest for the period beginning on
the Original Issue Date and ending on such initial Interest Payment Date shall
be paid to the person to whom this Note shall have been originally issued.
Payment of principal and interest on this Note will be made, if at maturity or
upon earlier redemption, then on the Maturity Date or the date fixed for
redemption, as applicable, upon surrender of this Note at the Corporate Trust
Office of the Trustee in The City of New York, and if upon repayment prior to
maturity, then on the applicable Repayment Date, provided that the holder shall
have complied with the requirements for repayment set forth on the reverse
hereof. All such payments shall be made in immediately available funds,
provided that this Note is presented to the Corporate Trust Office of the
Trustee in The City of New York in time for the Trustee to make such payments in
such funds in accordance with its normal procedures. Any such payments made in
a Specified Currency other than U.S. Dollars shall be made by wire transfer to
an account maintained by the holder, as designated by the holder by written
notice to the Trustee at least 15 calendar days prior to the date fixed for
payment, with a bank located in the country of the Specified Currency. Payment
of interest on this Note (other than interest paid on the Maturity Date or upon
earlier redemption or repayment) will be made by check (from an account at a
bank outside of the United States if such check is payable in a Specified
Currency other than U.S. Dollars) mailed to the address of the person entitled
thereto appearing on the register for the Notes on the applicable Record Date.
At the option of the Issuer or a holder of Notes (as defined on the reverse
hereof) in an aggregate principal amount exceeding $5 million or the equivalent
in a Specified Currency,
2
<PAGE> 3
payment of interest on this Note (other than interest paid on the Maturity Date
or upon earlier redemption or repayment) will be made by wire transfer to an
account maintained by such holder with a bank located in the United States for a
payment in U.S. Dollars or with a bank located in the country of the Specified
Currency for other payments, provided that any such holder selecting such option
shall have designated such account by written notice to the Trustee no later
than the Record Date preceding the applicable Interest Payment Date. Any
interest not punctually paid or duly provided for shall be payable as provided
in the Indenture referred to on the reverse hereof.
Interest will be computed on the basis of a 360-day year of twelve
30-day months.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET
FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL HAVE THE SAME
EFFECT AS THOUGH FULLY SET FORTH AT THIS PLACE.
This Note shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been manually signed
by or on behalf of the Trustee under the Indenture referred to on the reverse
hereof.
AGENCY FOR TRANSFER, EXCHANGE AND PAYMENT:
FIRST UNION NATIONAL BANK
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed
in its name by the facsimile signatures of its duly authorized officers, and
has caused a facsimile of its corporate seal to be affixed hereunto or
imprinted hereon.
Dated: AIR PRODUCTS AND CHEMICALS, INC.
---------------------
By:
--------------------------------
Chairman of the Board
(CORPORATE SEAL)
Attest:
----------------------------
Vice President and Secretary
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the series designated therein referred to
in the within-mentioned Indenture.
FIRST UNION NATIONAL BANK, as Trustee
By:
---------------------------
Authorized Officer
3
<PAGE> 4
[FORM OF REVERSE OF NOTE]
This Note is one of a duly authorized issue of unsecured debentures,
notes or other evidences of indebtedness of the Issuer (hereinafter called the
"Securities") of the series hereinafter specified, all issued or to be issued
under and pursuant to an indenture dated as of January 10, 1995 (the
"Indenture"), duly executed and delivered by the Issuer to First Union National
Bank (formerly, First Fidelity Bank, National Association), as Trustee (the
"Trustee"), to which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the rights, limitations of rights,
obligations, duties and immunities thereunder of the Trustee, the Issuer and the
holders (the words "holders" or "holder" meaning the registered holders or
registered holder of the Securities). The Securities may be issued in one or
more series, which different series (and which securities issued within each
series) may be issued in various aggregate principal amounts, may mature at
different times, may bear interest (if any) at different rates, may be subject
to different redemption or repayment provisions (if any), may be subject to
different sinking fund or analogous provisions (if any), may be subject to
different Events of Default (as defined in the Indenture) and may otherwise vary
as in the Indenture provided. This Note is one of a series designated as
"Medium-Term Notes, Series F, Due from 9 Months to 30 Years from Date of Issue"
(the "Notes") of the Issuer, limited in aggregate principal amount to U.S.
$500,000,000, or the equivalent thereof in the Specified Currency or Currencies.
In case an Event of Default with respect to the Notes shall have
occurred and be continuing, the principal hereof may be declared, and upon such
declaration shall become, due and payable, in the manner, with the effect and
subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Issuer and the
Trustee, with the consent of the holders of not less than 66-2/3% in aggregate
principal amount of the Securities at the time outstanding (as defined in the
Indenture) of all series to be affected (voting as one class), evidenced as in
the Indenture provided, to execute supplemental indentures adding any provisions
to or changing in any manner or eliminating any of the provisions of the
Indenture or of any supplemental indenture or modifying in any manner the rights
of the holders of the Securities of each such series; provided, however, that no
such supplemental indenture shall (i) extend the final maturity of any Security,
or reduce the principal amount thereof, or reduce the rate or extend the time of
payment of interest thereon, or reduce any amount payable on redemption thereof,
or reduce the amount of the principal of an Original Issue Discount Security
that would be due and payable upon an acceleration of the maturity thereof
pursuant to Section 5.1 of the Indenture or the amount thereof provable in
bankruptcy pursuant to Section 5.2 of the Indenture, or impair or affect the
right of any Securityholder to institute suit for the payment thereof or the
right of repayment, if any, at the option of the Securityholder without the
consent of the holder of each Security so affected, or (ii) reduce the aforesaid
percentage of Securities of any series, the consent of the holders of which is
required for any such supplemental indenture, without the consent of the holder
of each Security so affected. Any such consent or waiver by the holder of this
Note (unless revoked as provided in the Indenture) shall be conclusive and
binding upon such holder and upon all future holders and owners of this Note and
any Notes which may be issued in exchange or substitution therefor, irrespective
of whether or not any notation thereof is made upon this Note or such other
Notes.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and any premium and
interest on this Note at the place, at the respective times, at the rate and in
the coin, currency or currency unit herein prescribed unless in accordance with
Section 10.1(c) or Section 10.2 of the Indenture the Issuer shall have
irrevocably deposited or caused to be deposited in trust with the Trustee funds
in cash and/or U.S. Government Obligations and/or Foreign Government Securities
(each as defined in the Indenture) as will be sufficient to pay interest due or
to become due on the Notes to, and to pay the principal and any premium due on
the Notes upon, the Maturity Date or upon earlier redemption or repayment.
The Issuer shall be deemed to have paid the principal of, premium, if
any, and interest on the Notes when the same shall have become due and payable
if in accordance with Section 10.1(c) or Section 10.2(A) the Issuer shall have
irrevocably deposited or caused to be deposited in trust with the Trustee funds
in cash and/or U.S. Government Obligations and/or Foreign Government Securities
(each as defined in the Indenture) as will be sufficient to pay
4
<PAGE> 5
interest due or to become due on the Notes to, and to pay the principal and any
premium due on the Notes upon, the Maturity Date or upon earlier redemption or
repayment of the outstanding Notes.
The Notes are issuable in fully registered form without coupons in the
minimum denomination of U.S. $100,000 or the equivalent thereof in the Specified
Currency, and in integral multiples of U.S. $1,000 in excess thereof or 10,000
units of the Specified Currency.
If an Initial Redemption Date is specified on the face hereof, this
Note may be redeemed at the option of the Issuer, as a whole or from time to
time in part, on any date on or after such Initial Redemption Date and prior to
maturity, upon mailing a notice of such redemption not less than 30 nor more
than 60 days prior to the date fixed for redemption to the holders of Notes to
be redeemed at their last registered addresses, all as further provided in the
Indenture, at the Optional Redemption Prices, if any, specified on the face
hereof (expressed in percentages of the principal amount) together, in each
case, with accrued interest to the date fixed for redemption.
If a Repayment Date is specified or Repayment Dates are specified on
the face hereof, this Note will be repayable at the option of the holder, in
whole or from time to time in part, on such Repayment Date or Repayment Dates
at 100% of the portion of the principal amount to be repaid, together with
interest accrued on such portion to the Repayment Date on which repayment is
sought. In order for this Note to be repaid, the Issuer must receive at the
Corporate Trust Office of the Trustee in the Borough of Manhattan, The City of
New York, during the period from and including the first day of the Repayment
Option Period for the applicable Repayment Date to and including the
close of business on the last day of such Repayment Option Period (or if such
day is not a business day, the next succeeding business day): (i) this Note
with the form below entitled "Option to Elect Repayment" duly completed, or
(ii) a telegram, telex, facsimile transmission or letter from a member of a
national securities exchange or the National Association of Securities
Dealers, Inc., or a commercial bank or a trust company in the United States of
America, dated no later than the last day of such Repayment Option Period (or
if such day is not a business day, the next succeeding business day) setting
forth the name of the holder of the Note, the principal amount of the Note, the
portion of the principal amount of the Note to be repaid, a statement that the
option to elect repayment is being exercised thereby and a guarantee that the
Note to be repaid in whole or in part (with the form entitled "Option to Elect
Repayment" on the reverse of the Note duly completed) will be received at the
Corporate Trust Office of the Trustee in the Borough of Manhattan, The City of
New York, not later than five business days after the date of such telegram,
telex, facsimile transmission or letter and such Note and form duly completed
must be received at the Corporate Trust Office of the Trustee in the Borough of
Manhattan, The City of New York, by such fifth business day. Effective
exercise of any repayment option by the holder of any Note shall be
irrevocable. No transfer or exchange of any Note (or, in the event that any
Note is to be repaid in part, such portion of the Note to be repaid) will be
permitted after exercise of a repayment option. A repayment option may be
exercised by the holder of a Note for less than the entire principal amount of
the Note, provided that the principal amount which is to be repaid is equal to
$1,000 or any integral multiple thereof for Notes denominated in U.S. Dollars
or 10,000 units of the Specified Currency or any integral multiple thereof for
Notes denominated in a Specified Currency other than U.S. Dollars. All
questions as to the validity, eligibility (including time of receipt) and
acceptance of any Note for repayment will be determined by the Issuer, whose
determination will be final, binding and non-appealable. For purposes of this
provision, "business day" means any day other than Saturday and Sunday or a
legal holiday or any day on which banking institutions in New York, New York
are authorized or required by law or regulation to close.
Upon due presentment for registration of transfer of this Note at the
Corporate Trust Office of the Trustee or at such other office or agency as is
designated by the Issuer in the Borough of Manhattan, The City of New York, a
new Note or Notes of authorized denominations for an equal aggregate principal
amount and like tenor will be issued to the transferee in exchange therefor,
subject to the limitations provided in the Indenture, without charge except for
any tax or other governmental charge imposed in connection therewith; provided,
however, that if this Note is a Global Note (as specified on the face hereof),
this Note is exchangeable only if (x) the Depositary notifies the Issuer that it
is unwilling or unable to continue as Depositary for this Note or if at any time
the Depositary ceases to be in good standing under the Securities Exchange Act
of 1934, as amended, or other applicable statutes or regulations, and the Issuer
does not appoint a successor Depositary within 90 days after the Issuer received
such notice or becomes aware of such ineligibility or (y) the Issuer in its sole
discretion determines that this Note shall be exchanged for certificated Notes
in definitive form, provided that the definitive Notes so issued in exchange for
this
5
<PAGE> 6
Note shall be in authorized denominations and be of like aggregate principal
amount and tenure and terms as the portion of this Note to be exchanged.
If "yes" is specified under "U.S. Dollar Payments Option" on the face
hereof, the registered holder of this Note shall be entitled to receive payments
in U.S. Dollars at the Exchange Rate determined as set forth in the Indenture by
notifying the Trustee at the time and in the manner described therein. Costs,
if any, associated with the conversion of the Specified Currency into U.S.
Dollars shall be borne by such holder through deduction from payments required
to be made to such holder on this Note.
The Issuer will pay any administrative costs imposed by banks in
connection with making payments on this Note by wire transfer, but any tax,
assessment or governmental charge imposed upon payments will be borne by the
holder hereof.
The Issuer, the Trustee and any agent of the Issuer or the Trustee may
deem and treat the registered holder hereof as the absolute owner of this Note
(whether or not this Note shall be overdue and notwithstanding any notation of
ownership or other writing hereon) for the purpose of receiving payment of or
on account of the principal hereof and premium, if any, and subject to the
provisions on the face hereof, interest hereon, and for all other purposes, and
neither the Issuer nor the Trustee nor any agent of the Issuer or the Trustee
shall be affected by any notice to the contrary.
No recourse under or upon any obligation, covenant or agreement
contained in the Indenture or in any Note, or because of any indebtedness
evidenced thereby, shall be had against any incorporator, stockholder, officer
or director, as such, of the Issuer or of any successor, either directly or
through the Issuer or any successor, under any rule of law, statute or
constitutional provision or by the enforcement of any assessment or by any
legal or equitable proceeding or otherwise, all such liability being expressly
waived and released by the acceptance hereof and as part of the consideration
for the issue hereof.
Undefined terms used herein which are defined in the Indenture shall
have the respective meanings assigned thereto in the Indenture.
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably requests and instructs the Issuer
to repay the within Note (or the portion hereof specified below) pursuant to
its terms at a price equal to 100% of the portion of the principal amount of
the Note to be repaid together with interest accrued thereon to the Repayment
Date, to the undersigned at
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address of the undersigned)
If less than the entire principal amount of the within Note is to be
repaid, specify the portion thereof which the holder elects to have repaid
_____________________________________________; and specify the denomination or
denominations (which shall be authorized denominations) of the Notes to be
issued to the holder for the portion of the within Note not being repaid (in
the absence of any such specification, one such Note will be issued for the
portion not being repaid):
________________________________________________________________________________
Date:__________________________ ___________________________________
(Signature)
6
<PAGE> 7
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM --as tenants in common
TEN ENT --as tenants by the entireties
JT TEN --as joint tenants with right of survivorship and not as
tenants in common
UNIF GIFT MIN ACT --...........Custodian..........
(Cust) (Minor)
under Uniform Gifts to Minors
Act..................
(State)
Additional abbreviations may also be used though not in the above list.
________________________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE
________________________________________________________________________________
the within Note of AIR PRODUCTS AND CHEMICALS, INC. and hereby does irrevocably
constitute and appoint
________________________________________________________________________Attorney
to transfer the said Note on the books of the within-named Issuer, with full
power of substitution in the premises.
Dated________________________ _________________________________________
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the certificate in every
particular, without alteration or
enlargement or any change whatever.
7
<PAGE> 1
[FORM OF FACE OF NOTE]
AIR PRODUCTS AND CHEMICALS, INC.
Medium-Term Note, Series F
DUE FROM 9 MONTHS TO 30 YEARS FROM DATE OF ISSUE
(FLOATING RATE)
Registered Principal Amount
No. FL- CUSIP
Global Note: Yes No
--- ---
Depositary:
[Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to the Issuer
or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or such other name
as is requested by an authorized representative of DTC (and any payment is made
to Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof,
Cede & Co., has an interest herein.]
[THIS SECURITY IS A GLOBAL SECURITY AS REFERRED TO IN THE INDENTURE
HEREINAFTER REFERENCED. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART
FOR THE INDIVIDUAL SECURITIES REPRESENTED HEREBY, THIS GLOBAL SECURITY MAY NOT
BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.]
IF APPLICABLE THE "TOTAL AMOUNT OF OID," "ORIGINAL YIELD TO MATURITY" AND
"INITIAL ACCRUAL PERIOD OID" (COMPUTED UNDER THE APPROXIMATE METHOD) BELOW WILL
BE COMPLETED SOLELY FOR THE PURPOSES OF APPLYING THE FEDERAL INCOME TAX
ORIGINAL ISSUE DISCOUNT ("OID") RULES.
Issue Price: Base Rate:
Original Issue Date: Index Maturity:
Maturity Date: Reset Period:
Specified Currency: Spread (plus or minus):
U.S. Dollars [ ]
Other: Spread Multiplier:
U.S. Dollar Payments Option: Maximum Interest Rate:
Initial Redemption Date: Minimum Interest Rate:
Interest Determination Dates: Initial Accrual Period OID:
Interest Reset Dates: Original Yield to Maturity:
-1-
<PAGE> 2
Initial Interest Rate Interest Payment Dates:
Repayment Date(s): Total Amount of OID:
Repayment Option Period(s): Calculation Agent:
If applicable as described above, the Optional Redemption Price
initially shall be ________% of the principal amount of this Note to be redeemed
and shall decline at each anniversary of the Initial Redemption Date by
_________% of the principal amount to be redeemed until the Optional Redemption
Price is 100% of such principal amount, together with interest thereon to the
date fixed for redemption.
AIR PRODUCTS AND CHEMICALS, INC., a Delaware corporation (the
"Issuer"), for value received, hereby promises to pay to or
registered assigns, the principal sum of
PRINCIPAL AMOUNT
on the Maturity Date specified above or upon earlier redemption or repayment at
the Corporate Trust Office of the Trustee in the Borough of Manhattan, The City
of New York, State of New York, or such other location or locations as may be
provided for pursuant to the Indenture referred to herein in such coin, currency
or currency unit specified above as at the time of payment shall be legal tender
for the payment of public and private debts, and to pay interest on said
principal sum from the most recent date to which interest has been paid or duly
provided for, or, if no interest has been paid or duly provided for, from the
Original Issue Date until the principal hereof becomes due and payable, at a
rate per annum equal to the Initial Interest Rate from the Original Issue Date
until the first Interest Reset Date following such Original Issue Date and
thereafter at a rate determined in accordance with the provisions on the reverse
hereof under the heading "Determination of Commercial Paper Rate,"
"Determination of LIBOR" or "Determination of Treasury Rate," depending upon
whether the Base Rate specified above is the Commercial Paper Rate, LIBOR or the
Treasury Rate, respectively. The Issuer will pay interest on this Note on each
Interest Payment Date commencing with the first Interest Payment Date next
succeeding the Original Issue Date, and on the Maturity Date or upon earlier
redemption or repayment; provided, however, that any payment of principal or
interest to be made on an Interest Payment Date, on the Maturity Date, on a date
fixed for redemption or on a Repayment Date which is not a Business Day (as
hereinafter defined) shall be made on the next succeeding Business Day with the
same force and effect as if made on the Interest Payment Date, on the Maturity
Date, on the date fixed for redemption or on the Repayment Date, as the case
may be, and no additional interest shall accrue as a result of such delayed
payment, except that, if the Base Rate in respect of this Note is LIBOR, as
specified above, and such Business Day falls in the next calendar month, such
payment will be made on the immediately preceding Business Day. For purposes
of this Note, "Business Day" means any day, other than a Saturday or Sunday,
that is neither a legal holiday nor a day on which banking institutions are
authorized or required by law or regulation to close in New York, New York,
or, if this Note is denominated in a Specified Currency other than U.S. Dollars,
_____________________________________________________________
Principal Financial Center of Country of Specified Currency
or, if the Base Rate specified above is LIBOR, the City of London, England, or,
if this Note is denominated in European Currency Units, Brussels, Belgium.
"London Banking Day" means any day on which dealings in deposits in U.S. Dollars
are transacted in the London interbank market. Except as provided above and in
the Indenture referred to on the reverse hereof, interest payments will be made
on the Interest Payment Dates specified above. The interest so payable, and
punctually paid or duly provided for, on any Interest Payment Date will be paid
to the person in whose name this Note (or one or more predecessor Notes) is
registered at the close of business on the 15th day (whether or not a Business
Day) immediately preceding such Interest Payment Date (a "Record Date") and
interest
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<PAGE> 3
payable on the Maturity Date or upon earlier redemption or repayment will be
payable to the person to whom principal is payable, except that, if this Note is
issued between a Record Date and the initial Interest Payment Date relating to
such Record Date, interest for the period beginning on the Original Issue Date
and ending on such initial Interest Payment Date shall be paid to the person to
whom this Note shall have been originally issued. Payment of principal and
interest on this Note will be made, if at maturity or upon earlier redemption,
then on the Maturity Date or the date fixed for redemption, as applicable, upon
surrender of this Note at the Corporate Trust Office of the Trustee in The City
of New York, and if upon repayment prior to maturity, then on the applicable
Repayment Date, provided that the holder shall have complied with the
requirements for repayment set forth on the reverse hereof. All such payments
shall be made in immediately available funds, provided that this Note is
presented to the Corporate Trust Office of the Trustee in The City of New York
in time for the Trustee to make such payments in such funds in accordance with
its normal procedures. Any such payments made in a Specified Currency other
than U.S. Dollars shall be made by wire transfer to an account maintained by the
holder, as designated by the holder by written notice to the Trustee at least 15
calendar days prior to the date fixed for payment, with a bank located in the
country of the Specified Currency. Payment of interest on this Note (other than
interest paid on the Maturity Date or upon earlier redemption or repayment) will
be made by check (from an account at a bank outside of the United States if such
check is payable in a Specified Currency other than U.S. Dollars) mailed to the
address of the person entitled thereto appearing on the register for the Notes
on the applicable Record Date. At the option of the Issuer or a holder of Notes
(as defined on the reverse hereof) in an aggregate principal amount exceeding $5
million or the equivalent in a Specified Currency, payment of interest on this
Note (other than interest paid on the Maturity Date or upon earlier redemption
or repayment) will be made by wire transfer to an account maintained by such
holder with a bank located in the United States for a payment in U.S. Dollars or
with a bank located in the country of the Specified Currency for other payments,
provided that any such holder selecting such option shall have designated such
account by written notice to the Trustee no later than the Record Date preceding
the applicable Interest Payment Date. Any interest not punctually paid or duly
provided for shall be payable as provided in the Indenture referred to on the
reverse hereof.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS ON THE REVERSE
HEREOF, WHICH FURTHER PROVISIONS SHALL FOR ALL PURPOSES HAVE THE SAME EFFECT
AS THOUGH FULLY SET FORTH AT THIS PLACE.
This Note shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been manually signed
by or on behalf of the Trustee under the Indenture referred to on the reverse
hereof.
AGENCY FOR TRANSFER, EXCHANGE AND PAYMENT:
FIRST UNION NATIONAL BANK
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed
in its name by the facsimile signatures of its duly authorized officers, and
has caused its corporate seal to be affixed hereunto or imprinted hereon by
facsimile.
Dated: AIR PRODUCTS AND CHEMICALS, INC.
------------------------
By:
--------------------------------
Chairman of the Board
(CORPORATE SEAL) Attest:
----------------------------
Vice President and Secretary
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<PAGE> 4
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the series designated therein referred to
in the within-mentioned Indenture.
FIRST UNION NATIONAL BANK,
as Trustee
By: ______________________________
Authorized Officer
[FORM OF REVERSE OF NOTE]
AIR PRODUCTS AND CHEMICALS, INC.
This Note is one of a duly authorized issue of unsecured debentures,
notes or other evidences of indebtedness of the Issuer (hereinafter called the
"Securities") of the series hereinafter specified, all issued or to be issued
under and pursuant to an indenture dated as of January 10, 1995 the
"Indenture"), duly executed and delivered by the Issuer to First Union National
Bank (formerly, First Fidelity Bank, National Association), as Trustee (the
"Trustee"), to which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the rights, limitations of rights,
obligations, duties and immunities thereunder of the Trustee, the Issuer and the
holders (the words "holders" or "holder" meaning the registered holders or
registered holder of the Securities). The Securities may be issued in one or
more series, which different series (and which securities issued within each
series) may be issued in various aggregate principal amounts, may mature at
different times, may bear interest (if any) at different rates, may be subject
to different redemption or repayment provisions (if any), may be subject to
different sinking fund or analogous provisions (if any), may be subject to
different Events of Default (as defined in the Indenture) and may otherwise vary
as in the Indenture provided. This Note is one of a series designated as
"Medium-Term Notes, Series F, Due from 9 Months to 30 Years from Date of Issue"
(the "Notes") of the Issuer, limited in aggregate principal amount to U.S.
$500,000,000, or the equivalent thereof in the Specified Currency or Currencies.
The rate of interest on this Note will be reset daily, weekly,
monthly, quarterly, semiannually or annually (such type of period being the
"Reset Period" for this Note, and the first day of each Reset Period being an
"Interest Reset Date"), as specified on the face hereof. The Interest Reset
Dates will be, if this Note has a daily Reset Period, each Business Day; if this
Note has a weekly Reset Period and a Base Rate other than the Treasury Rate,
Wednesday of each week; if this Note has a weekly Reset Period and the Base Rate
is the Treasury Rate, Tuesday of each week; if this Note has a monthly Reset
Period, the third Wednesday of each month; if this Note has a quarterly Reset
Period, the third Wednesday of each March, June, September and December; if this
Note has a semiannual Reset Period, the third Wednesday of each of two months of
each year specified on the face hereof under "Interest Reset Dates"; and if this
Note has an annual Reset Period, the third Wednesday of one month of each year
specified on the face hereof under "Interest Reset Dates"; provided, however,
that the interest rate in effect for the ten days immediately prior to the
Maturity Date, or, with respect to any portion of the principal amount hereof to
be redeemed or repaid, if applicable, the date of redemption or Repayment Date,
of this Note will be that in effect on the tenth day preceding such Maturity
Date or such date of redemption or Repayment Date. If an Interest Reset Date
would otherwise be a day that is not a Business Day, such Interest Reset Date
shall be postponed to the next day that is a Business Day, except that, if the
Base Rate is LIBOR, as indicated on the face hereof, if such Business Day is in
the next succeeding calendar month, such Interest Reset Date shall be the
immediately preceding Business Day.
Except as provided below, interest on this Note will be payable, if
this Note resets daily, weekly or monthly, on the third Wednesday of each month
or on the third Wednesday of March, June, September and December of each year,
as specified on the face hereof; if this Note resets quarterly, on the third
Wednesday of March, June, September and December of each year; if this Note
resets semiannually, on the third Wednesday of each of two months of each year
specified on the face hereof; and if this Note resets annually, on the third
Wednesday of one month of each year specified on the face hereof (each such day
being an "Interest Payment Date"). If an Interest Payment Date with
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<PAGE> 5
respect to this Note would otherwise fall on a day that is not a Business Day,
such Interest Payment Date will be the following day that is a Business Day,
except that, if the Base Rate is LIBOR, as indicated on the face hereof, if such
Business Day falls in the next calendar month, such Interest Payment Date will
be the immediately preceding Business Day.
Unless otherwise indicated on the face hereof, each payment of
interest hereon will include interest accrued to but excluding the applicable
Interest Payment Date; provided, however, that if the interest rate hereon is
reset daily or weekly, interest payable on any Interest Payment Date, other than
interest payable on any date on which principal for this Note is payable, will
include interest accrued to and including the immediately preceding Record Date.
Accrued interest from the date of issue or from the last date to which interest
has been paid will be calculated by multiplying the face amount of this Note by
an accrued interest factor. This accrued interest factor is computed by adding
the interest factors calculated for each day from the date of issue, or from the
last date to which interest has been paid, to the date for which accrued
interest is being calculated. The interest factor (expressed as a decimal
rounded upward, if necessary, to the nearest one hundred-thousandth of a
percentage point) for each such day is computed by dividing the interest rate
(expressed as a decimal rounded upward, if necessary, to the nearest one
hundred-thousandth of a percentage point) applicable to such date by 360, if the
Base Rate is the Commercial Paper Rate or LIBOR, as indicated on the face
hereof, or by the actual number of days in the year if the Base Rate is the
Treasury Rate.
The interest rate on this Note during any Reset Period will in no
event be higher than the maximum rate permitted by New York law as the same may
be modified by United States law of general application or the Maximum Interest
Rate, if any, specified on the face hereof and will not be lower than the
Minimum Interest Rate, if any, specified on the face hereof.
DETERMINATION OF COMMERCIAL PAPER RATE. If the Base Rate is the
Commercial Paper Rate, as indicated on the face hereof, the "Commercial Paper
Rate" for each Reset Period will be determined by the Calculation Agent as of
the Business Day prior to the Interest Reset Date that commences such Reset
Period (a "Commercial Paper Interest Determination Date") and shall be, with
respect to any Commercial Paper Interest Determination Date, the Money Market
Yield (as defined below) of the rate on that date for commercial paper having
the Index Maturity designated on the face hereof placed on behalf of industrial
issuers whose corporate bonds are rated "AA" or the equivalent, from a
nationally recognized securities rating agency as such rate is made available
by the Federal Reserve Bank of New York for such date. In the event that such
rate is not made available by the Federal Reserve Bank of New York by 3:00
P.M., New York City time, on such Commercial Paper Interest Determination Date,
then the Commercial Paper Rate for such Commercial Paper Interest Determination
Date shall be calculated by the Calculation Agent and shall be the Money Market
Yield of the arithmetic mean (each as rounded upward, if necessary, to the
nearest one hundred-thousandth of a percentage point) of the offered rates for
such commercial paper quoted as of 11:00 A.M., New York City time, on such
Commercial Paper Interest Determination Date by three leading dealers of
commercial paper in The City of New York selected, after consultation with the
Issuer by the Calculation Agent; provided, however, that if the dealers
selected as aforesaid by the Calculation Agent are not quoting as mentioned in
this sentence, the Commercial Paper Rate with respect to such Commercial Paper
Interest Determination Date will be the Commercial Paper Rate in effect on such
Commercial Paper Interest Determination Date.
"Money Market Yield" shall be a yield (expressed as a percentage
rounded upwards, if necessary, to the nearest one hundred-thousandth of a
percentage point) calculated in accordance with the following formula:
Money Market Yield = D X 360 X 100
-----------------
360 - (D X M)
where "D" refers to the per annum rate for the commercial paper, quoted on a
bank discount basis and expressed as a decimal, and "M" refers to the actual
number of days in the interest period for which interest is being calculated.
The interest rate for each Reset Period shall be determined by the
Calculation Agent and shall be the Commercial Paper Rate applicable to such
Reset Period plus or minus the Spread or multiplied by the Spread Multiplier,
as indicated on the face hereof; provided, however, that the interest rate in
effect for the period from the
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<PAGE> 6
Original Issue Date to the first Interest Reset Date will be the Initial
Interest Rate and the interest rate in effect for the ten days immediately prior
to the Maturity Date, or, with respect to any portion of the principal amount
hereof to be redeemed or repaid, if applicable, the date of redemption or
Repayment Date, will be that in effect on the tenth day preceding such Maturity
Date or such date of redemption or Repayment Date.
DETERMINATION OF LIBOR. If the Base Rate is LIBOR, as indicated on
the face hereof, "LIBOR" for each Reset Period will be determined by the
Calculation Agent as follows:
(i) On the second London Banking Day prior to the
Interest Reset Date that commences such Reset Period (the "LIBOR
Interest Determination Date"), LIBOR will be, as specified on the face
hereof, either (a) the arithmetic mean of the offered rates for
deposits having the Index Maturity designated on the face hereof,
commencing on the second London Business Day immediately following
such LIBOR Interest Determination Date, that appear on the Reuters
Screen LIBO Page as of 11:00 A.M., London time, on such LIBOR Interest
Determination Date, if at least two such offered rates appear on the
Reuters Screen LIBO Page ("LIBOR Reuters"), or (b) the rate for
deposits having the Index Maturity designated on the face hereof,
commencing on the second London Business Day immediately following
such LIBOR Interest Determination Date, that appears on Telerate Page
3750 as of 11:00 A.M., London Time, on such LIBOR Interest
Determination Date ("LIBOR Telerate"). "Reuters Screen LIBO Page"
means the display designated as page "LIBO" on the Reuters Monitor
Money Rate Service (or such other page as may replace page LIBO on
that service for the purpose of displaying London Interbank offered
rates of major banks). "Telerate Page 3750" means the display
designated as page "3750" on the Telerate Service (or such other page
as may replace the 3750 page on that service or such other service or
services as may be nominated by the British Bankers' Association for
the purpose of displaying London Interbank offered rates for
deposits). If neither LIBOR Reuters nor LIBOR Telerate is specified
on the face hereof, LIBOR will be determined as if LIBOR Telerate had
been specified. If at least two such offered rates appear on the
Reuters Screen LIBO Page, the rate in respect of such LIBOR Interest
Determination Date will be the arithmetic mean of such offered rates
as determined by the Calculation Agent. If fewer than two offered
rates appear on the Reuters Screen LIBO Page, or if no rate appears
on Telerate Page 3750, as applicable, LIBOR in respect of such LIBOR
Interest Determination Date will be determined as if the parties had
specified the rate described in (ii) below.
(ii) On any LIBOR Interest Determination Date on which
fewer than two offered rates appear on the Reuters Screen LIBO Page as
specified in (i)(a) above, or on which no rate appears on Telerate Page
3750, as specified in (i)(b) above, as applicable, LIBOR will be
determined on the basis of the rates at which deposits having the
Index Maturity designated on the face hereof are offered at
approximately 11:00 A.M., London time, on such LIBOR Interest
Determination Date by four major banks in the London Interbank market
(the "Reference Banks") selected, after consultation with the Issuer,
by the Calculation Agent to prime banks in the London Interbank
market having the Index Maturity designated on the face hereof,
commencing on the second London Banking Day immediately following such
LIBOR Interest Determination Date and in a principal amount equal to
an amount of not less than $1,000,000 that is representative for a
single transaction in such market at such time. The Calculation Agent
will request the principal London office of each of such Reference
Banks to provide a quotation of its rate. If at least two such
quotations are provided, LIBOR in respect of such LIBOR Interest
Determination Date will be the arithmetic mean (rounded upward, if
necessary, to the nearest one hundred-thousandth of a percentage
point) of such quotations. If fewer that two quotations are provided,
LIBOR in respect of such LIBOR Interest Determination Date will be the
arithmetic mean (rounded upward, if necessary, to the nearest one
hundred-thousandth of a percentage point) of the rates quoted at
approximately 11:00 A.M., New York City time, on such LIBOR Interest
Determination Date by three major banks in The City of New York
selected, after consultation with the Issuer, by the Calculation Agent
for loans in U.S. Dollars to leading European banks having the Index
Maturity designated on the face hereof, commencing on the second
London Banking Day immediately following such LIBOR Interest
Determination Date and in a principal amount equal to an amount of not
less than $1,000,000 that is representative for a single transaction
in such market at such time; provided, however, that if the banks in
The City of New York selected as aforesaid by the Calculation Agent
are not quoting as mentioned in this sentence, LIBOR with respect to
such LIBOR Interest Determination Date will be LIBOR in effect on such
LIBOR Interest Determination Date.
-6-
<PAGE> 7
The interest rate for each Reset Period shall be determined by the
Calculation Agent and shall be LIBOR plus or minus the Spread or multiplied by
the Spread Multiplier, as indicated on the face hereof; provided, however, that
the interest rate in effect for the period from the Original Issue Date to the
first Interest Reset Date will be the Initial Interest Rate and the interest
rate in effect for the ten days immediately prior to the Maturity Date, or, with
respect to any portion of the principal amount hereof to be redeemed or repaid,
if applicable, the date of redemption or Repayment Date, will be that in effect
on the tenth day preceding such Maturity Date or such date of redemption or
Repayment Date.
DETERMINATION OF TREASURY RATE. If the Base Rate is the Treasury
Rate, as indicated on the face hereof. the "Treasury Rate" with respect to any
Treasury Interest Determination Date (as defined below) will be the auction
average rate (expressed as a bond equivalent, rounded upward, if necessary, to
the nearest one hundred-thousandth of a percentage point on the basis of a year
of 365 or 366 days, as applicable, and applied on a daily basis) for the most
recent auction of direct obligations of the United States ("Treasury bills")
having the Index Maturity designated on the face hereof, as made available by
the U.S. Department of the Treasury. In the event that the results of the
auction of Treasury bills having the Index Maturity designated on the face
hereof are not made available as provided above by 3:00 P.M., New York City
time, on such Treasury Interest Determination Date or no such auction is held
in a particular week (or on the preceding Friday, if applicable), the Treasury
Rate shall be calculated by the Calculation Agent and shall be a yield to
maturity (expressed as a bond equivalent, rounded upward, if necessary, to the
nearest one hundred-thousandth of a percentage point, on the basis of a year of
365 or 366 days, as applicable, and applied on a daily basis) of the arithmetic
mean of the secondary market bid rates, as of 3:30 P.M. New York City time, on
such Treasury Interest Determination Date, of three leading primary U.S.
government securities dealers selected, after consultation with the Issuer, by
the Calculation Agent for the issue of Treasury bills with a remaining maturity
closest to the Index Maturity designated on the face hereof; provided, however,
that if the dealers selected as aforesaid by the Calculation Agent are not
quoting as mentioned in this sentence, the Treasury Rate with respect to such
Treasury Interest Determination Date will be the Treasury Rate in effect on
such Treasury Interest Determination Date.
The "Treasury Interest Determination Date" will be the day of the week
in which the related Interest Reset Date falls on which Treasury bills would
normally be auctioned. Treasury bills are usually sold at auction on Monday of
each week unless that day is a legal holiday, in which case the auction is
usually held on the following Tuesday, except that such auction may be held on
the preceding Friday. If, as the result of a legal holiday, an auction is so
held on the preceding Friday, such Friday will be the Treasury Interest
Determination Date pertaining to the Reset Period commencing in the next
succeeding week. If an auction date shall fall on such an Interest Reset Date,
then such Interest Reset Date shall instead be the first Business Day
immediately following such auction date.
The interest rate for each Reset Period shall be determined by the
Calculation Agent and shall be the Treasury Rate plus or minus the Spread or
multiplied by the Spread Multiplier, as indicated on the face hereof, provided,
however, that the interest rate in effect for the period from the Original
Issue Date to the first Interest Reset Date will be the Initial Interest Rate
and the interest rate in effect for the ten days immediately prior to the
Maturity Date, or, with respect to any portion of the principal amount hereof
to be redeemed or repaid, if applicable, the date of redemption or Repayment
Date, will be that in effect on the tenth day preceding such Maturity Date or
such date of redemption or Repayment Date.
The Trustee shall be the Calculation Agent, unless another Calculation
Agent is specified on the face hereof. At the request of the holder hereof,
the Calculation Agent will provide the interest rate then in effect and, if
determined, the interest rate which will become effective on the next Interest
Reset Date.
In case an Event of Default with respect to the Notes shall have
occurred and be continuing, the principal hereof may be declared, and upon such
declaration shall become, due and payable in the manner, with the effect and
subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Issuer and the
Trustee, with the consent of the holders of not less than 66 2/3% in aggregate
principal amount of the Securities at the time outstanding (as defined in the
Indenture) of all series to be affected (voting as one class), evidenced as in
the Indenture provided, to execute
-7-
<PAGE> 8
supplemental indentures adding any provisions to or changing in any manner or
eliminating any of the provisions of the Indenture or of any supplemental
indenture or modifying in any manner the rights of the holders of the
Securities of each such series; provided, however, that no such supplemental
indenture shall (i) extend the final maturity of any Security, or reduce the
principal amount thereof, or reduce the rate or extend the time of payment of
interest thereon, or reduce any amount payable on redemption thereof, or reduce
the amount of the principal of an Original Issue Discount Security that would
be due and payable upon an acceleration of the maturity thereof pursuant to
Section 5.1 of the Indenture or the amount thereof provable in bankruptcy
pursuant to Section 5.2 of the Indenture, or impair or affect the right of any
Securityholder to institute suit for the payment thereof or the right of
repayment, if any, at the option of the Securityholder without the consent of
the holder of each Security so affected or (ii) reduce the aforesaid percentage
of Securities of any series, the consent of the holders of which is required
for any such supplemental indenture, without the consent of the holder of each
Security so affected. Any such consent or waiver by the holder of this Note
(unless revoked as provided in the Indenture) shall be conclusive and binding
upon such holder and upon all future holders and owners of this Note and any
Notes which may be issued in exchange or substitution therefor, irrespective of
whether or not any notation thereof is made upon this Note or such other Notes.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and any premium and interest
on this Note at the place, at the respective times, at the rate and in the coin,
currency or currency unit herein prescribed unless in accordance with Section
10.1(c) or Section 10.2 of the Indenture the Issuer shall have irrevocably
deposited or caused to be deposited in trust with the Trustee funds in cash
and/or U.S. Government Obligations and/or Foreign Government Securities (each as
defined in the Indenture) as will be sufficient to pay interest due or to become
due on the Notes to, and the principal and any premium due on the Notes upon,
the Maturity Date or upon earlier redemption or repayment.
The Issuer shall be deemed to have paid the principal of, premium, if
any, and interest on the Notes when the same shall have become due and payable
if in accordance with Section 10.1(c) or Section 10.2(A), the Issuer shall have
irrevocably deposited or caused to be deposited in trust with the Trustee funds
in cash and/or U.S. Government Obligations and/or Foreign Government Securities
(each as defined in the Indenture) as will be sufficient to pay interest due or
to become due on the Notes to, and to pay the principal and any premium due on
the Notes upon, the Maturity Date or upon earlier redemption or repayment of the
outstanding Notes.
The Notes are issuable in fully registered form without coupons in the
minimum denomination of U.S. $100,000 or the equivalent thereof in the
Specified Currency, and in integral multiples of U.S. $1,000 in excess thereof
or 10,000 units of the Specified Currency.
If an Initial Redemption Date is specified on the face hereof, this
Note may be redeemed at the option of the Issuer as a whole, or from time to
time in part, on any date on or after such Initial Redemption Date and prior to
maturity, upon mailing a notice of such redemption not less than 30 nor more
than 60 days prior to the date fixed for redemption to the holders of Notes to
be redeemed at their last registered addresses, all as further provided in the
Indenture, at the Optional Redemption Prices, if any specified on the face
hereof (expressed in percentages of the principal amount) together, in each
case, with accrued interest to the date fixed for redemption.
If a Repayment Date is specified or Repayment Dates are specified on
the face hereof, this Note will be repayable at the option of the holder, in
whole or from time to time in part, on such Repayment Date or Repayment Dates
at 100% of the portion of the principal amount to be repaid, together with
interest accrued on such portion to the Repayment Date on which repayment is
sought. In order for this Note to be repaid, the Issuer must receive at the
Corporate Trust Office of the Trustee in the Borough of Manhattan, The City of
New York, during the period from and including the first day of the Repayment
Option Period for the applicable Repayment Date to and including the close of
business on the last day of such Repayment Option Period (or if such day is not
a business day, the next succeeding business day): (i) this Note with the form
below entitled "Option to Elect Repayment" duly completed, or (ii) a telegram,
telex, facsimile transmission or letter from a member of a national securities
exchange or the National Association of Securities Dealers, Inc., or a
commercial bank or a trust company in the United States of America, dated no
later than the last day of such Repayment Option Period (or if such day is not
a business day, the next succeeding business day) setting forth the name of the
holder of the Note, the principal amount of the Note, the portion of the
principal amount of the Note to be repaid, a statement that the option to elect
repayment is being
-8-
<PAGE> 9
exercised thereby and a guarantee that the Note to be repaid in whole or in
part (with the form entitled "Option to Elect Repayment" on the reverse of the
Note duly completed) will be received at the Corporate Trust Office of the
Trustee in the Borough of Manhattan, The City of New York, not later than five
business days after the date of such telegram, telex, facsimile transmission or
letter and such Note and form duly completed must be received at the Corporate
Trust Office of the Trustee in the Borough of Manhattan, The City of New York,
by such fifth business day. Effective exercise of any repayment option by the
holder of any Note shall be irrevocable. No transfer or exchange of any Note
(or, in the event that any Note is to be repaid in part, such portion of the
Note to be repaid) will be permitted after exercise of a repayment option. A
repayment option may be exercised by the holder of a Note for less than the
entire principal amount of the Note, provided that the principal amount which
is to be repaid is equal to $1,000 or any integral multiple thereof for Notes
denominated in U.S. Dollars or 10,000 units of the Specified Currency or any
integral multiple thereof for Notes denominated in a Specified Currency other
than U.S. Dollars. All questions as to the validity, eligibility (including
time of receipt) and acceptance of any Note for repayment will be determined by
the Issuer, whose determination will be final, binding and non-appealable. For
purposes of this provision, "business day" means any day other than Saturday
and Sunday or a legal holiday or any day on which banking institutions in New
York, New York are authorized or required by law or regulation to close.
Upon due presentment for registration of transfer of this Note at the
Corporate Trust Office of the Trustee or at such other office or agency as is
designated by the Issuer in the Borough of Manhattan, The City of New York, a
new Note or Notes of authorized denominations for an equal aggregate principal
amount and like tenor will be issued to the transferee in exchange therefor,
subject to the limitations provided in the Indenture, without charge except for
any tax or other governmental charge imposed in connection therewith; provided,
however, that if this Note is a Global Note (as specified on the face hereof),
this Note is exchangeable only if (x) the Depositary notifies the Issuer that
it is unwilling or unable to continue as Depositary for this Note or if at any
time the Depositary ceases to be in good standing under the Securities Exchange
Act of 1934, as amended, or other applicable statutes or regulations, and the
Issuer does not appoint a successor Depositary within 90 days after the Issuer
received such notice or becomes aware of such ineligibility, or (y) the Issuer
in its sole discretion determines that this Note shall be exchanged for
certificated Notes in definitive form, provided that the definitive Notes so
issued in exchange for this Note shall be in authorized denominations and be of
like aggregate principal amount and tenure and terms as the portion of this
Note to be exchanged.
If "yes" is specified under "U.S. Dollar Payments Option" on the face
hereof, the registered holder of this Note shall be entitled to receive
payments in U.S. Dollars at the Exchange Rate determined as set forth in the
Indenture by notifying the Trustee at the time and in the manner described
therein. Costs, if any, associated with the conversion of the Specified
Currency into U.S. Dollars shall be borne by such holder through deduction
from payments required to be made to such holder on this Note.
The Issuer will pay any administrative costs imposed by banks in
connection with making payments on this Note by wire transfer, but any tax,
assessment or governmental charge imposed upon payments will be borne by the
holder hereof.
The Issuer, the Trustee and any agent of the Issuer or the Trustee may
deem and treat the registered holder hereof as the absolute owner of this Note
(whether or not this Note shall be overdue and notwithstanding any notation of
ownership or other writing hereon) for the purpose of receiving payment of or
on account of the principal hereof and premium, if any, and subject to the
provisions on the face hereof, interest hereon, and for all other purposes, and
neither the Issuer nor the Trustee nor any agent of the Issuer or the Trustee
shall be affected by any notice to the contrary.
No recourse under or upon any obligation, covenant or agreement
contained in the Indenture or in any Note, or because of any indebtedness
evidenced thereby, shall be had against any incorporator, stockholder, officer
or director, as such, of the Issuer or of any successor, either directly or
through the Issuer or any successor, under any rule of law, statute or
constitutional provision or by the enforcement of any assessment or by any
legal or equitable proceeding or otherwise, all such liability being expressly
waived and released by the acceptance hereof and as part of the consideration
for the issue hereof.
-9-
<PAGE> 10
Undefined terms used herein which are defined in the Indenture shall
have the respective meanings assigned thereto in the Indenture.
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably requests and instructs the Issuer
to repay the within Note (or the portion hereof specified below) pursuant to
its terms at a price equal to 100% of the portion of the principal amount of
the Note to be repaid together with interest accrued thereon to the Repayment
Date, to the undersigned at
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address of the undersigned)
If less than the entire principal amount of the within Note is to be
repaid, specify the portion thereof which the holder elects to have repaid
_________________________; and specify the denomination or denominations (which
shall be authorized denominations) of the Notes to be issued to the holder for
the portion of the within Note not being repaid (in the absence of any such
specification, one such Note will be issued for the portion not being repaid):
________________________________________________________________________________
Date:______________________ ________________________________
(Signature)
-10-
<PAGE> 11
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT MIN ACT -- _________________ Custodian _________________
(Cust) (Minor)
under Uniform Gifts to Minors Act ___________
(State)
Additional abbreviations may also be used though not in the above list.
___________________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE
________________________________________________________________________________
the within Note of AIR PRODUCTS AND CHEMICALS, INC. and hereby does irrevocably
constitute and appoint
_______________________________________________________________________ Attorney
to transfer the said Note on the books of the within-named Issuer, with full
power of substitution in the premises.
Dated:_____________________________
_________________________________________
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the certificate in every
particular, without alteration or
enlargement or any change whatever.
-11-
<PAGE> 1
[FORM OF FACE OF NOTE]
AIR PRODUCTS AND CHEMICALS, INC.
MEDIUM-TERM NOTE, SERIES F
DUE FROM 9 MONTHS TO 30 YEARS FROM DATE OF ISSUE
(FIXED RATE CURRENCY INDEXED)
Registered Face Amount
No. FXCI- CUSIP
Global Note: Yes No
----- -----
Depositary:
[Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to the Issuer
or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or such other name
as is requested by an authorized representative of DTC (and any payment is made
to Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof,
Cede & Co., has an interest herein.
THIS SECURITY IS A GLOBAL SECURITY AS REFERRED TO IN THE INDENTURE
HEREINAFTER REFERENCED. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART
FOR THE INDIVIDUAL SECURITIES REPRESENTED HEREBY, THIS GLOBAL SECURITY MAY NOT
BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.]
IF APPLICABLE, THE "TOTAL AMOUNT OF OID," "YIELD TO MATURITY" AND
"INITIAL ACCRUAL PERIOD OID" (COMPUTED UNDER THE APPROXIMATE METHOD) BELOW WILL
BE COMPLETED SOLELY FOR THE PURPOSES OF APPLYING THE FEDERAL INCOME TAX
ORIGINAL ISSUE DISCOUNT ("OID") RULES.
<TABLE>
<S> <C>
Issue Price: Initial Accrual Period OID:
Interest Rate: Specified Currency:
Interest Payment Dates: U.S. Dollars [ ]
Original Issue Date: Other:
--------------------
Maturity Date: U.S. Dollar Payments Option:
Repayment Date(s): Indexed Currency:
Initial Redemption Date: Face Amount:
Determination Agent: Base Exchange Rate:
Repayment Option Period(s): Base Interest Rate:
Total Amount of OID: Reference Dealers:
Yield to Maturity: Other Provisions:
Record Dates:
</TABLE>
1
<PAGE> 2
If applicable as described above, the Optional Redemption Price
initially shall be _______% of the principal amount of this Note to be redeemed
and shall decline at each anniversary of the Initial Redemption Date by
_______% of the principal amount to be redeemed until the Optional Redemption
Price is 100% of such principal amount, together with interest thereon to the
date fixed for redemption.
AIR PRODUCTS AND CHEMICALS, INC., a Delaware corporation (the
"Issuer"), for value received, hereby promises to pay to
, or registered assigns, the principal sum of
(the "Face Amount") plus or minus an amount as determined in accordance with
the terms hereof on the Maturity Date specified above or upon earlier
redemption or repayment at the Corporate Trust office of the Trustee in the
Borough of Manhattan, The City of New York, State of New York, or such other
locations as may be provided for pursuant to the Indenture referred to on the
reverse hereof, in such coin, currency or currency unit specified above as at
the time of payment shall be legal tender for the payment of public and private
debts, and to pay interest semiannually on each Interest Payment Date in each
year and on the Maturity Date or upon earlier redemption or repayment,
commencing with the first Interest Payment Date next succeeding the Original
Issue Date specified above upon the Face Amount at the Interest Rate or, if a
Base Interest Rate is specified above, at the Base Interest Rate multiplied by
an amount as determined in accordance with the terms hereof from the most
recent date to which interest has been paid or duly provided for, or, if no
interest has been paid or duly provided for, from the Original Issue Date,
until the principal hereof becomes due and payable; provided, however, that any
payment of principal or interest to be made on an Interest Payment Date, on the
Maturity Date, on a date fixed for redemption or on a Repayment Date which is
not a Business Day shall be made on the next succeeding Business Day (as
hereinafter defined) with the same force and effect as if made on the Interest
Payment Date, on the date fixed for redemption or on the Repayment Date, as
the case may be, and no additional interest shall accrue as a result of such
delayed payment. For purposes of this Note, "Business Day" means any day,
other than a Saturday or Sunday, that is neither a legal holiday nor a day on
which banking institutions are authorized or required by law or regulation to
close in New York, New York, or if this Note is denominated in a Specified
Currency other than U.S. Dollars,
-----------------------------------------------------------
Principal Financial Center of Country of Specified Currency
or, if this Note is denominated in European Currency Units, Brussels, Belgium.
The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will be paid to the person in whose name this Note (or
one or more predecessor Notes) is registered at the close of business on the
Record Date (whether or not a Business Day) immediately preceding such Interest
Payment Date and interest payable on the Maturity Date or upon earlier
redemption or repayment will be payable to the person to whom principal is
payable, except that, if this Note is issued between a Record Date and the
initial Interest Payment Date relating to such Record Date, interest for the
period beginning on the Original Issue Date and ending on such initial Interest
Payment Date shall be paid to the person to whom this Note shall have been
originally issued. The principal amount payable at the Maturity Date or upon
earlier redemption or repayment will be determined by the rate of exchange
between the Specified Currency and the Indexed Currency. The holder of this
Note will be entitled to receive principal in an amount exceeding the amount
designated as the Face Amount, if, at the Maturity Date or upon earlier
redemption or repayment, the rate at which the Specified Currency can be
exchanged for the Indexed Currency is greater than the rate of such exchange
2
<PAGE> 3
designated above as the Base Exchange Rate expressed in units of the Indexed
Currency per one unit of the Specified Currency, and will be entitled to
receive principal in an amount less than the Face Amount if, at the Maturity
Date or upon earlier redemption or repayment, the rate at which the Specified
Currency can be exchanged for the Indexed Currency is less than the Base
Exchange Rate. If a Base Interest Rate is specified above, the interest
payable on each Interest Payment Date will be determined by the Base Interest
Rate and the rate of exchange between the Specified Currency and the Indexed
Currency. The holder of this Note will be entitled to receive an interest
payment exceeding the amount based on the Face Amount and the Interest Rate if,
on an Interest Payment Date, the rate at which the Specified Currency can be
exchanged for the Indexed Currency is greater than the rate of such exchange
designated above as the Base Exchange Rate, expressed in units of the Indexed
Currency per one unit of the Specified Currency, and will be entitled to
receive an interest payment below the amount based on the Face Amount and the
Interest Rate if, on an Interest Payment Date, the rate at which the Specified
Currency can be exchanged for the Indexed Currency is less than the Base
Exchange Rate. Payment of principal and interest on this Note will be made, if
at maturity or upon earlier redemption, than on the Maturity Date or the date
fixed for redemption, as applicable, upon surrender of this Note at the
Corporate Trust Office of the Trustee in The City of New York, and if upon
repayment prior to maturity, than on the applicable Repayment Date, provided
that the holder shall have complied with the requirements for repayment set
forth on the reverse hereof. All such payments shall be made in immediately
available funds, provided that this Note is presented to the Corporate Trust
Office of the Trustee in The City of New York in time for the Trustee to make
such payments in such funds in accordance with its normal procedures. Any such
payments made in a Specified Currency other than U.S. Dollars shall be made by
wire transfer to an account maintained by the holder, as designated by the
holder by written notice to the Trustee at least 15 calendar days prior to the
date fixed for payment, with a bank located in the country of the Specified
Currency. Payment of interest on this Note (other than interest paid on the
Maturity Date or upon earlier redemption or repayment) will be made by check
(from an account at a bank outside of the United States if such check is
payable in a Specified Currency other than U.S. Dollars) mailed to the address
of the person entitled thereto appearing on the register for the Notes on the
applicable Record Date. At the option of the Issuer or a holder of Notes (as
defined on the reverse hereof) in an aggregate principal amount exceeding $5
million or the equivalent in a Specified Currency, payment of interest on this
Note (other than interest paid on the Maturity Date or upon earlier redemption
or repayment) will be made by wire transfer to an account maintained by such
holder with a bank located in the United States for a payment in U.S. Dollars
or with a bank located in the country of the Specified Currency for other
payments, provided that any such holder selecting such option shall have
designated such account by written notice to the Trustee no later than the
Record Date preceding the applicable Interest Payment Date. Any interest not
punctually paid or duly provided for shall be payable as provided in the
Indenture referred to on the reverse hereof.
Interest will be computed on the basis of a 360-day year of twelve
30-day months.
REFERENCE IS HEREBY MADE TO THE FURTHER PROVISIONS OF THIS NOTE SET
FORTH ON THE REVERSE HEREOF, WHICH FURTHER PROVISIONS SHALL HAVE THE SAME
EFFECT AS THOUGH FULLY SET FORTH AT THIS PLACE.
This Note shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been manually signed
by or on behalf of the Trustee under the Indenture referred to on the reverse
hereof.
AGENCY FOR TRANSFER, EXCHANGE AND PAYMENT:
FIRST UNION NATIONAL BANK
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed
in its name by the facsimile signatures of its duly authorized officers, and
has caused its corporate seal to be affixed hereunto or imprinted hereon by
facsimile.
Dated: AIR PRODUCTS AND CHEMICALS, INC.
------------
By:
-------------------------------------
Chairman of the Board
Attest:
---------------------------------
(CORPORATE SEAL) Vice President and Secretary
3
<PAGE> 4
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the series designated therein referred to
in the within-mentioned Indenture
FIRST UNION NATIONAL BANK,
as Trustee
By:
--------------------
Authorized Officer
[FORM OF REVERSE OF NOTE]
AIR PRODUCTS AND CHEMICALS, INC.
This Note is one of a duly authorized issue of unsecured debentures,
notes or other evidences of indebtedness of the Issuer (hereinafter called the
"Securities") of the series hereinafter specified, all issued or to be issued
under and pursuant to an indenture dated as of January 10, 1995 (the
"Indenture"), duly executed and delivered by the Issuer to First Union National
Bank (formerly, First Fidelity Bank, National Association), as Trustee (the
"Trustee"), to which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Trustee, the Issuer and the
holders (the words "holders" or "holder" meaning the registered holders or
registered holder of the Securities). The Securities may be issued in one or
more series, which different series (and which securities issued within each
series) may be issued in various aggregate principal amounts, may mature at
different times, may bear interest (if any) at different rates, may be subject
to different redemption or repayment provisions (if any), may be subject to
different sinking fund or analogous provisions (if any), may be subject to
different Events of Default (as defined in the Indenture) and may otherwise vary
as in the Indenture provided. This Note is one of a series designated as
"Medium-Term Notes, Series F, Due from 9 Months to 30 Years from Date of Issue"
(the "Notes") of the Issuer, limited in aggregate principal amount to U.S.
$500,000,000, or the equivalent thereof in the Specified Currency or Currencies.
In case an Event of Default with respect to the Notes shall have
occurred and be continuing, the principal hereof may be declared, and upon
such declaration shall become, due and payable, in the manner, with the effect
and subject to the conditions provided in the Indenture.
The Indenture contains provisions permitting the Issuer and the
Trustee, with the consent of the holders of not less than 66 2/3% in aggregate
principal amount of the Securities at the time outstanding (as defined in the
Indenture) of all series to be affected (voting as one class), evidenced as in
the Indenture provided, to execute supplemental indentures adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Indenture or of any supplemental indenture or modifying in any manner the
rights of the holders of the Securities of each such series: provided,
however, that no such supplemental indenture shall (i) extend the final
maturity of any Security, or reduce the principal amount thereof, or reduce the
rate or extend the time of payment of interest thereon, or reduce any amount
payable on redemption thereof, or reduce the amount of the principal of an
Original Issue Discount Security that would be due and payable upon an
acceleration of the maturity thereof pursuant to Section 5.1 of the Indenture
or the amount thereof provable in bankruptcy pursuant to Section 5.2 of the
Indenture, or impair or affect the right of any Securityholder to institute
suit for the payment thereof or the right of repayment, if any, at the option
of the Securityholder without the consent of the holder of each Security so
affected, or (ii) reduce the aforesaid percentage of Securities of any series,
the consent of the holders of which is required for any such supplemental
indenture, without the consent of the holder of each Security so affected. Any
such consent or waiver by the holder of this Note (unless revoked as provided
in the Indenture) shall be conclusive and binding upon such
4
<PAGE> 5
holder and upon all future holders and owners of this Note and any Notes which
may be issued in exchange or substitution herefor, irrespective of whether or
not any notation thereof is made upon this Note or such other Notes.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the principal of and any premium and interest
on this Note at the place, at the respective times, at the rate and in the coin,
currency or currency unit herein prescribed unless in accordance with Section
10.1(c) or Section 10.2 of the Indenture the Issuer shall have irrevocably
deposited or caused to be deposited in trust with the Trustee funds in cash
and/or U.S. Government Obligations and/or Foreign Government Securities (each as
defined in the Indenture) as will be sufficient to pay interest due or to become
due on the Notes to, and to pay the principal and any premium due on the Notes
upon, the Maturity Date or upon earlier redemption or repayment.
The Issuer shall be deemed to have paid the principal of, premium, if
any, and interest on the Notes when the same shall have become due and payable
if in accordance with Section 10.1(c) or Section 10.2(A) the Issuer shall have
irrevocably deposited or caused to be deposited in trust with the Trustee funds
in cash and/or U.S. Government Obligations and/or Foreign Government Securities
(each as defined in the Indenture) as will be sufficient to pay interest due or
to become due on the Notes to, and to pay the principal and any premium due on
the Notes upon, the Maturity Date or upon earlier redemption or repayment the
outstanding Notes.
The Notes are issuable in fully registered form without coupons in the
minimum denominations of U.S. $100,000 or the equivalent thereof in the
Specified Currency, and in integral multiples of U.S. $1,000 in excess thereof
or 10,000 units of the Specified Currency.
If an Initial Redemption Date is specified on the face hereof, this
Note may be redeemed at the option of the Issuer, as a whole or from time to
time in part, on any date on or after such Initial Redemption Date and prior to
maturity, upon mailing a notice of such redemption not less than 30 nor more
than 60 days prior to the date fixed for redemption to the holders of the Notes
to be redeemed at their last registered addresses, all as further provided in
the Indenture, at the Optional Redemption Prices, if any, specified on the face
hereof (expressed in percentages of the principal amount) together in each case
with accrued interest to the date fixed for redemption.
If a Repayment Date is specified or Repayment Dates are specified on
the face hereof, this Note will be repayable at the option of the holder, in
whole or from time to time in part, on such Repayment Date or Repayment Dates
at 100% of the portion of the principal amount to be repaid, together with
interest accrued on such portion to the Repayment Date on which repayment is
sought. In order for this Note to be repaid, the Issuer must receive at the
Corporate Trust Office of the Trustee in the Borough of Manhattan, The City of
New York, during the period from and including the first day of the Repayment
Option Period for the applicable Repayment Date to and including the close of
business on the last day of such Repayment Option Period (or if such day is not
a business day, the next succeeding business day): (i) this Note with the form
below entitled "Option to Elect Repayment" duly completed, or (ii) a telegram,
telex, facsimile transmission or letter from a member of a national securities
exchange, or the National Association of Securities Dealers, Inc., or a
commercial bank or a trust company in the United States of America, dated no
later than the last day of such Repayment Option Period (or if such day is not
a business day, the next succeeding business day) setting forth the name of the
holder of the Note, the principal amount of the Note, the portion of the
principal amount of the Note to be repaid, a statement that the option to elect
repayment in being exercised thereby and a guarantee that the Note to be repaid
in whole or in part (with the form entitled "Option to Elect Repayment" on the
reverse of the Note duly completed) will be received at the Corporate Trust
Office of the Trustee in the Borough of Manhattan, The City of New York, no
later the five business days after the date of such telegram, telex, facsimile
transmission or letter and such Note and form duly completed must be
received at the Corporate Trust Office in the Borough of Manhattan, The City of
New York, by such fifth business day. Effective exercise of any repayment
option by the holder of any Note shall be irrevocable. No transfer or exchange
of any Note (or, in the event that any Note is to be repaid in part, such
portion of the Note to be repaid) will be permitted after exercise of a
repayment option. A repayment option may be exercised by the holder of a Note
for less than the entire principal amount of the Note, provided that the
principal amount which is to be repaid is equal to $1,000 or any integral
multiple thereof for Notes denominated in U.S Dollars or 10,000 units of the
Specified Currency or any integral multiple thereof for Notes denominated in a
Specified Currency other than U.S. Dollars. All question as to the validity,
eligibility (including time of receipt) and acceptance of any Note for
repayment will be determined by
5
<PAGE> 6
the Issuer, whose determination will be final, binding and non-appealable. For
purposes of this provision, "business day" means any day other than Saturday
and Sunday or a legal holiday or any day on which banking institutions in New
York, New York are authorized or required by law or regulation to close.
Upon due presentment for registration of transfer of this Note at the
Corporate Trust Office of the Trustee or at such other office or agency as is
designated by the Issuer in the Borough of Manhattan, The City of New York, a
new Note or Notes of authorized denominations for an equal aggregate principal
amount and like tenor will be issued to the transferee in exchange therefor,
subject to the limitations provided in the Indenture, without charge except for
any tax or other governmental charge imposed in connection therewith; provided,
however, that if this Note is a Global Note (as specified on the face hereof),
this Note is exchangeable only if (x) the Depositary notifies the Issuer that
it is unwilling or unable to continue as Depositary for this Note or if at any
time the Depositary ceases to be in good standing under the Securities Exchange
Act of 1934, as amended, or other applicable statutes or regulations, and the
Issuer does not appoint a successor Depositary within 90 days after the Issuer
receives such notice or becomes aware of such ineligibility, or (y) the Issuer
in its sole discretion determines that this Note shall be exchanged for
certified Notes in definitive form, provided that the definitive Notes so
issued in exchange for this Note shall be in authorized denominations and be of
like aggregate principal amount and tenor and terms as the portion of this Note
to be exchanged.
Unless otherwise specified on the face hereof, principal of this Note
will be payable by the Issuer in the Specified Currency (except as set forth
herein) at the Maturity Date in an amount equal to the Face Amount plus or
minus an amount determined by the Determination Agent by reference to the
difference between the Base Exchange Rate and the rate at which the Specified
Currency can be exchanged for the Indexed Currency as determined on the second
Exchange Rate Day (the "Determination Date") prior to the Maturity Date by the
Determination Agent based upon the arithmetic mean of the open market spot
offer quotations for the Indexed Currency obtained by the Determination Agent
from the Reference Dealers in The City of New York at 11:00 a.m., New York City
time, on the Determination Date, for an amount of the Indexed Currency equal to
the Face Amount multiplied by the Base Exchange rate, for settlement on the
Maturity Date (such rate of exchange, as so determined and expressed in units
of the Indexed Currency per one unit of Specified Currency, is hereafter
referred to as the "Spot Rate"). If such quotations from the Reference Dealers
are not available on the Determination Date due to circumstances beyond the
control of the Issuer or the Determination Agent, the Spot Rate will be
determined on the basis of the most recently available quotations from the
Reference Dealers. If any of the Reference Dealers shall be unwilling or
unable to provide the requested quotations, such other major money center bank
or banks in The City of New York as shall be selected by the Issuer, in
consultation with the Determination Agent, shall act as Reference Dealer or
Reference Dealers in replacement therefor. In the absence of manifest error,
the determination by the Determination Agent of the Spot Rate and the principal
amount of this Note payable at the Maturity Date shall be final and binding on
the Issuer and the holder of this Note.
Unless otherwise specified on the face hereof, the formulae to be used
by the Determination Agent to determine the principal amount payable at the
Maturity Date will be as follows: If the Spot Rate exceeds or equals the Base
Exchange Rate, the principal amount payable at the Maturity Date shall equal:
Face Amount + (Face Amount x Spot Rate - Base Exchange Rate)
------------------------------
Spot Rate.
If the Base Exchange Rate exceeds the Spot Rate, the principal amount payable
at the Maturity Date (which shall, in no event, be less than zero) shall equal:
Face Amount - (Face Amount x Base Exchange Rate - Spot Rate)
------------------------------
Spot Rate.
If the formulae set forth above are applicable hereto, the maximum principal
amount payable at the Maturity Date in respect hereof would be an amount equal
to twice the Face Amount and the minimum principal amount payable would be
zero. Unless otherwise specified above, the term "Exchange Rate Day" shall
mean any day which is a
6
<PAGE> 7
Business Day in The City of New York and (i) if the Specified Currency or
Indexed Currency is any currency or currency unit other than the U.S. Dollar or
the ECU, a Business Day in the principal financial center of the country of such
Specified Currency or Indexed Currency or (ii) in the case of the ECU, a day
which is not a non-ECU clearing day as determined by the ECU Banking Association
in Paris.
Unless otherwise specified on the face hereof, on the basis of the
aforesaid determination by the Determination Agent and the formulae and
limitations set forth above, (i) if the Base Exchange Rate equals the Spot Rate,
then the principal amount of this Note payable at the Maturity Date will be
equal to the Face Amount; (ii) if the Spot Rate exceeds the Base Exchange Rate,
then the principal amount so payable will be greater than the Face Amount hereof
up to an amount equal to twice the Face Amount hereof; (iii) if the Spot Rate is
less than the Base Exchange Rate but is greater than one-half of the Base
Exchange Rate, then the principal amount so payable will be less than the Face
Amount hereof; and (iv) if the Spot Rate is less than or equal to one-half of
the Base Exchange Rate, then the Spot Rate will be deemed to be one-half of the
Base Exchange Rate and no principal amount in respect of this Note will be
payable at the Maturity Date. In the event of any redemption or repayment, the
term "Maturity Date" used above also refers to the redemption date or Repayment
Date, if applicable.
Unless a Base Interest Rate is specified on the face hereof, interest
will be payable on the Face Amount at the Interest Rate. In the event that a
Base Interest Rate is specified on the face hereof, interest shall be payable on
each Interest Payment Date at a rate per annum equal to the Base Interest Rate
multiplied by an Interest Index Factor. The "Interest Index Factor" shall be an
amount determined by the Determination Agent by reference to the following
formula:
Interest Spot Rate
------------------
Base Exchange Rate
where "Interest Spot Rate" is (i) if at an Interest Payment Date, the rate at
which the Specified Currency can be exchanged for the Indexed Currency, as
determined on the second Exchange Rate Day prior to such Interest Payment Date
(the "Interest Determination Date") by the Determination Agent, on such Interest
Determination Date, (ii) if at the Maturity Date, the Spot Rate. The amount of
interest determined by the Determination Agent to be payable on any Interest
Payment Date and at the Maturity Date in respect of the Securities will be
payable to the holders thereof in the manner set forth herein. In the absence of
manifest error, the determination by the Determination Agent of the Interest
Index Factor, the Interest Spot Rate on each Interest Payment Date, the interest
payments payable and the Spot Rate at the Maturity Date on the Securities shall
be final and binding on the Issuer and the holders of such Securities.
If "yes" is specified under "U.S. Dollar Payments Option" on the face
hereof, the registered holder of this Note shall be entitled to receive payments
in U.S. Dollars at the Exchange Rate determined as set forth in the Indenture by
notifying the Trustee at the time and in the manner described therein. Costs, if
any, associated with the conversion of the Specified Currency into U.S. Dollars
shall be borne by such holder through deduction from payments required to be
made to such holder of this Note.
The Issuer will pay any administrative costs imposed by banks in
connection with making payments on this Note by wire transfer, but any tax,
assessment or governmental charge imposed upon payments will be borne by the
holder hereof.
The Issuer, the Trustee and any agent of the Issuer or the Trustee may
deem and treat the registered holder hereof as the absolute owner of this Note
(whether or not this Note shall be overdue and notwithstanding any notation of
ownership or other writing hereon) for the purpose of receiving payment of or on
account of the principal hereof and premium, if any, and subject to the
provisions on the face hereof, interest hereon, and for all other purposes, and
neither the Issuer nor the Trustee nor any agent of the Issuer or the Trustee
shall be affected by any notice to the contrary.
No recourse under or upon any obligation, covenant or agreement
contained in the Indenture or in any Note, or because of any indebtedness
evidenced thereby, shall be had against any incorporator, stockholder, officer
or director, as such, of the Issuer or of any successor, either directly or
through the Issuer or any successor, under any
7
<PAGE> 8
rule of law, statute or constitutional provision or by the enforcement of any
assessment or by any legal or equitable proceeding or otherwise, all such
liability being expressly waived and released by the acceptance hereof and as
part of the consideration for the Issuer hereof.
Undefined terms used herein which are defined in the Indenture shall
have the respective meanings assigned thereto in the Indenture.
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably requests and instructs the Issuer to
repay the within Note (or the portion hereof specified below) pursuant to its
terms at a price equal to 100% of the portion of the principal amount of the
Note to be repaid together with interest accrued thereon to the Repayment Date,
to the undersigned at
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Please print or typewrite name and address of the undersigned)
If less than the entire principal amount of the within Note is to be
repaid, specify the portion thereof which the holder elects to have repaid
__________ ; and specify the denomination or denominations (which shall be
authorized denominations) of the Notes to be issued to the holder for the
portion of the within the Note not being repaid (in the absence of any such
specification, one such Note will be issued for the portion not being repaid):
_________________________________________________________________
Date:___________________ ________________________________________
(Signature)
8
<PAGE> 9
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM -- as tenants in common
TEN ENT -- as tenants by the entireties
JT TEN -- as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT MIN ACT -- ________________Custodian________________
(Cust) (Minor)
under Uniform Gifts to Minors Act________
Additional abbreviations may also be used though not in the above list.
_________________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
_______________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE
_______________________________________________________________________________
the within Note of AIR PRODUCTS AND CHEMICALS, INC. and hereby does irrevocably
constitute and appoint
______________________________________________________________________ Attorney
to transfer the said Note on the books of the within-named Issuer, with full
power of substitution in the premises.
Dated___________
__________________________
NOTICE: The signature to
this assignment must
correspond with the name
as written upon the face
of the certificate in
every particular, without
alteration or enlargement
or any change whatever.
9
<PAGE> 1
[FORM OF FACE OF NOTE]
AIR PRODUCTS AND CHEMICALS, INC.
MEDIUM-TERM NOTE, SERIES F
DUE FROM 9 MONTHS TO 30 YEARS FROM DATE OF ISSUE
(S&P 500 LINKED)
Registered Face Amount $
Original Issue Date: Interest Rate: %
No. S&PL- CUSIP
Global Note: _____ Yes _____ No
[Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation (the "DTC"), to the
Issuer or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or such other name as
is requested by an authorized representative of DTC (and any payment is made to
Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof,
Cede & Co., has an interest herein.
THIS SECURITY IS A GLOBAL SECURITY AS REFERRED TO IN THE INDENTURE
HEREINAFTER REFERENCED. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR
THE INDIVIDUAL SECURITIES REPRESENTED HEREBY, THIS GLOBAL SECURITY MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY
OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR
A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.]
AIR PRODUCTS AND CHEMICALS, INC., a Delaware corporation (herein called
the "Issuer"), for value received, hereby promises to pay to
, or registered assigns, the Maturity Amount (as defined below) on
________________ (the "Maturity Date"), at the Corporate Trust Office of the
Trustee in the Borough of Manhattan, The City of New York, State of New York, or
such other location or locations as may be provided for pursuant to the
Indenture (as defined below), in such coin, currency or currency unit of the
________________ as at the time of payment shall be legal tender for the payment
of public and private debts. No periodic payments of interest will be payable in
respect of this Note.
Maturity Amount
The amount payable on the Maturity Date in respect of this Note (the
"Maturity Amount") will be equal to the greater of (i) the Minimum Maturity
Amount and (ii) the Index Maturity Amount.
The "Minimum Maturity Amount" with respect to this Note means _____% of
the principal amount hereof (the "Principal Amount"). The "Index Maturity
Amount" with respect to this Note means an amount equal to the sum of (i) the
Principal Amount and (ii) the product of (x) the Principal Amount, (y) the Index
Appreciation Ratio and (z) the Participation Rate. Where:
1
<PAGE> 2
"Index Appreciation Ratio" means:
Final Average Index Value - Initial Index Value
-----------------------------------------------
Initial Index Value
"Participation Rate" means _____%.
The "Initial Index Value" equals __________, the closing value of the
S&P 500 Index on_______________.
The "Final Average Index Value" of the S&P 500 Index will be determined
by ________________ (the "Calculation Agent") and will equal the arithmetic
average (mean) of the Annual Values (as defined below) for _____, _____ and
_____. The "Annual Value" for any year will be calculated during the
"Calculation Period" for such year, which will be from and including __________
in _____, __________ in _____ and __________ in _____ to and including the fifth
scheduled Business Day (as hereinafter defined) after such date. The Annual
Value for each year will equal the arithmetic average (mean) of the closing
values of the S&P 500 Index on the first day in the applicable Calculation
Period (provided that a Market Disruption Event (as defined below) shall not
have occurred on such day) and on each succeeding Business Day (provided that a
Market Disruption Event shall not have occurred on the applicable day) up to and
including the last Business Day in the applicable Calculation Period (each, a
"Calculation Date") until the Calculation Agent has so determined such closing
values for five Business Days. If a Market Disruption Event occurs on two or
more of the Business Days during a Calculation Period, the Annual Value for the
relevant year will equal the average of the values on Business Days on which a
Market Disruption Event did not occur during such Calculation Period or, if
there is only one such Business Day, the value on such day. If Market Disruption
Events occur on all of such Business Days during a Calculation Period, the
Annual Value for the relevant year shall equal the closing value of the S&P 500
Index on the last Business Day of the Calculation Period regardless of whether a
Market Disruption Event shall have occurred on such day.
For purposes of determining the Final Average Index Value, a "Business
Day" is a day on which The New York Stock Exchange is open for trading.
"Market Disruption Event" means either of the following events, as
determined by the Calculation Agent:
(i) the suspension or material limitation (limitations
pursuant to New York Stock Exchange Rule 80A (or any applicable rule or
regulation enacted or promulgated by the New York Stock Exchange, any
other self-regulatory organization or the Securities and Exchange
Commission of similar scope as determined by the Calculation Agent) on
trading during significant market fluctuations shall be considered
"material" for purposes of this definition), in each case, for more
than two hours of trading in 100 or more of the securities included in
the S&P 500 Index, or
(ii) the suspension or material limitation, in each case, for
more than two hours of trading (whether by reason of movements in price
otherwise exceeding levels permitted by the relevant exchange or
otherwise) in (A) futures contracts related to the S&P 500 Index which
are traded on the Chicago Mercantile Exchange or (B) option contracts
related to the S&P 500 Index which are traded on the Chicago Board
Options Exchange, Inc.
For purposes of this definition, a limitation on the hours in a trading
day and/or number of days of trading will not constitute a Market Disruption
Event if it results from an announced change in the regular business hours of
the relevant exchange.
All determinations made by the Calculation Agent shall be at the sole
discretion of the Calculation Agent and, absent a determination by the
Calculation Agent of a manifest error, shall be conclusive for all purposes and
binding on the Issuer and beneficial owner of this Note.
2
<PAGE> 3
Discontinuance of the S&P 500 Index and Successor Index
If Standard & Poor's Corporation ("S&P") discontinues publication of
the S&P 500 Index and S&P or another entity publishes a successor or substitute
index that the Calculation Agent determines, in its sole discretion, to be
comparable to the S&P 500 Index (any such index being referred to hereinafter as
a "Successor Index"), then, upon the Calculation Agent's notification of such
determination to the Trustee and the Issuer, the Calculation Agent will
substitute the Successor Index as calculated by S&P or such other entity for the
S&P 500 Index.
If S&P discontinues publication of the S&P 500 Index and a Successor
Index is not selected by the Calculation Agent or is no longer published on any
of the Calculation Dates, the value to be substituted for the S&P 500 Index for
any such Calculation Date will be calculated as described below.
If a Successor Index is selected or the Calculation Agent calculates a
value as a substitute for the S&P 500 Index as described below, such Successor
Index or value shall be substituted for the S&P 500 Index for all purposes,
including for purposes of determining whether a Market Disruption Event exists.
If at any time the method of calculating the S&P 500 Index, or the
value thereof, is changed in a material respect, or if the S&P 500 Index is in
any other way modified such that in the opinion of the Calculation Agent, the
S&P 500 Index does not fairly represent the value of the S&P 500 Index had such
change or modification not been made, then, from and after such time, the
Calculation Agent shall on each Calculation Date make such adjustments as, in
the good faith judgment of the Calculation Agent, may be necessary in order to
arrive at a calculation of a stock index comparable to the S&P 500 Index as if
such change or modification had not been made. For example, if the method of
calculating the S&P 500 Index is modified so that the value of such S&P 500
Index is a fraction or a multiple of what it would have been if it had not been
modified (e.g., due to a split in the S&P 500 Index), then the Calculation Agent
shall adjust the S&P 500 Index in order to arrive at a value of the S&P 500
Index as if it had not been modified (e.g., as if such split had not occurred).
If S&P discontinues publication of the S&P 500 Index and a Successor
Index is available, then the Maturity Amount will be determined by reference to
the Successor Index, as provided above.
If the publication of the S&P 500 Index is discontinued and S&P or
another entity does not publish a Successor Index on any of the Calculation
Dates, the index to be substituted for the S&P 500 Index for any such
Calculation Date will be computed by the Calculation Agent for each such
Calculation Date in accordance with the following procedures:
(1) identifying the component stocks of the S&P 500 Index or
any Successor Index as of the last date on which either of such indices
was calculated by S&P or another entity and published by S&P or such
other entity (each such component stock is an "Index Component Stock");
(2) for each Index Component Stock, calculating as of each such
Calculation Date the product of the market price per share and the
number of the then-outstanding shares (such product referred to as the
"Market Value" of such Index Component Stock), by reference to (a) the
closing market price per share of such Index Component Stock as quoted
by the New York Stock Exchange or the American Stock Exchange or any
other registered national securities exchange that is the primary
market for such Index Component Stock, or if no such quotation is
available, then the closing market price as quoted by any other
registered national securities exchange or the National Association of
Securities Dealers Automated Quotation National Market System
("NASDAQ"), or if no such price is quoted, then the market price from
the best available source as determined by the Calculation Agent
(collectively, the "Exchanges") and (b) the most recent publicly
available statement of the number of outstanding shares of such Index
Component Stock;
(3) aggregating the Market Values obtained in clause (2)
for all Index Component Stocks;
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<PAGE> 4
(4) ascertaining the Base Value (as defined below) in
effect as of the last day on which either the S&P 500 Index or any
Successor Index was published by S&P or another entity (adjusted as
described below);
(5) dividing the aggregate Market Value of all Index
Component Stocks by the Base Value (adjusted as described below);
(6) multiplying the resulting quotient (expressed in
decimals) by ten.
"Base Value" shall mean the aggregate of the mean average Market Value
of the common stock of each company in a group of 500 companies substantially
similar to the current S&P 500 group over the base period of the years 1941
through 1943.
If any Index Component Stock is no longer publicly traded on any
registered national securities exchange or in the over-the-counter market, the
last available market price per share for such Index Component Stock as quoted
by any registered national securities exchange or in the over-the-counter
market, and the number of outstanding shares thereof at such time, will be used
in computing the last available Market Value of such Index Component Stock.
Such Market Value will be used in all computations of the S&P 500 Index
thereafter.
If a company that has issued an Index Component Stock and another
company that has issued an Index Component Stock are consolidated to form a new
company, the common stock of such new company will be considered an Index
Component Stock and the common stocks of the constituent companies will no
longer be considered Index Component Stocks. If any company that has issued an
Index Component Stock merges with, or acquires, a company that has not issued
an Index Component Stock, the common stock of the surviving corporation will,
upon the effectiveness of such merger or acquisition, be considered an Index
Component Stock. In each such case, the Base Value will be adjusted so that
the Base Value immediately after such consolidation, merger or acquisition will
equal (a) the Base Value immediately prior to such event, multiplied by (b) the
quotient of the aggregate Market Value of all Index Component Stocks
immediately after such event, divided by the aggregate Market Value for all
Index Component Stocks immediately prior to such event.
If a company that has issued an Index Component Stock issues a stock
dividend, declares a stock split or issues new shares pursuant to the
acquisition of another company, then, in each case, the Base Value will be
adjusted so that the Base Value immediately after the time the particular Index
Component Stock commences trading ex-dividend, the effectiveness of the stock
split or the time new shares of such Index Component Stock commence trading
equals (a) the Base Value immediately prior to such event, multiplied by (b)
the quotient of the aggregate Market Value for all Index Component Stocks
immediately after such event, divided by the aggregate Market Value of all
Index Component Stocks immediately prior to such event. The Base Value used by
the Calculation Agent to calculate the value described above will not
necessarily be adjusted in all cases in which S&P, in its discretion, might
adjust the Base Value.
4
<PAGE> 5
This Note shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been manually signed
by or on behalf of the Trustee under the Indenture referred to below.
AGENCY FOR TRANSFER, EXCHANGE AND PAYMENT:
FIRST UNION NATIONAL BANK
IN WITNESS WHEREOF, the Issuer has caused this instrument to be signed
in its name by the facsimile signatures of its duly authorized officers, and
has caused its corporate seal to be affixed hereunto or imprinted hereon by
facsimile.
Dated: AIR PRODUCTS AND CHEMICALS, INC.
--------------
By:
--------------------------------
Chairman of the Board
Attest:
(Corporate Seal) -----------------------------------
Vice President and Secretary
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debt Securities of the Series designated therein
referred to in the within-mentioned Indenture.
FIRST UNION NATIONAL BANK,
as Trustee
By:
--------------------------------
Authorized Officer
5
<PAGE> 6
[FORM OF REVERSE OF NOTE]
This Note is one of a duly authorized issue of unsecured debentures,
notes or other evidences of indebtedness of the Issuer (hereinafter called the
"Securities") of the series hereinafter specified, all issued or to be issued
under and pursuant to an indenture dated as of January 10, 1995 (the
"Indenture"), duly executed and delivered by the Issuer to First Union National
Bank (formerly, First Fidelity Bank, National Association), as Trustee (the
"Trustee"), to which Indenture and all indentures supplemental thereto reference
is hereby made for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Trustee, the Issuer and the
holders (the words "holders" or "holder" meaning the registered holders or
registered holder of the Securities). The Securities may be issued in one or
more series, which different series (and which securities issued within each
series) may be issued in various aggregate principal amounts, may mature at
different times, may bear interest (if any) at different rates, may be subject
to different redemption or repayment provisions (if any), may be subject to
different sinking fund or analogous provisions (if any), may be subject to
different Events of Default (as defined in the Indenture) and may otherwise vary
as in the Indenture provided. This Note is one of a series designated as
"Medium-Term Notes, Series F, Due from 9 Months to 30 Years from Date of Issue"
(the "Notes") of the Issuer, limited in aggregate principal amount to U.S.
$500,000,000, or the equivalent thereof in the Specified Currency or Currencies.
This Note is not subject to redemption by the Issuer or at the option
of the holders prior to maturity.
In case an Event of Default with respect to the Notes shall have
occurred and be continuing, the principal hereof may be declared, and upon such
declaration shall become, due and payable, in the manner, with the effect and
subject to the conditions provided in the Indenture. The amount payable in
respect hereof upon any acceleration permitted by the Indenture, with respect
to each $1,000 principal amount thereof, will be equal to the greater of (i)
the Principal Amount plus an amount equal to the interest which would have
accrued hereon from and including the date of original issuance to but
excluding the date of early redemption at an annualized rate of _____%,
calculated on a semiannual bond equivalent basis and (ii) the Index Maturity
Amount calculated as described above under "Maturity Amount" with the following
modifications. The Calculation Period used to calculate the final Annual Value
of this Note so accelerated will begin on the eighth scheduled Business Day
next preceding the scheduled date for such early redemption. If such final
Annual Value is the only Annual Value which shall have been calculated with
respect to this Note, such final Annual Value will be the Final Average Index
Value. If one or two other Annual Values shall have been calculated with
respect to this Note for prior years when this Note shall have been
outstanding, the average of the final Annual Value and such one other Annual
Value or such two other Annual Values, as the case may be, will be the Final
Average Index Value. If a bankruptcy proceeding is commenced in respect of the
Issuer, the claim with respect to this Note may be limited, under Section
502(b)(2) of Title 11 of the United States Code, to the Principal Amount plus
an additional amount of contingent interest calculated as though the date of
the commencement of the proceeding were the Maturity Date.
The Indenture contains provisions permitting the Issuer and the
Trustee, with the consent of the holders of not less than 66 2/3% in aggregate
principal amount of the Securities at the time outstanding (as defined in the
Indenture) of all series to be affected (voting as one class), evidenced as in
the Indenture provided, to execute supplemental indentures adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Indenture or of any supplemental indenture or modifying in any manner the
rights of the holders of the Securities of each such series; provided, however,
that no such supplemental indenture shall (i) extend the final maturity of any
Security, or reduce the principal amount thereof, or reduce the rate or extend
the time of payment of interest thereon, or reduce any amount payable on
redemption thereof, or reduce the amount of the principal of an Original Issue
Discount Security that would be due and payable upon an acceleration of the
maturity thereof pursuant to Section 5.1 of the Indenture or the amount thereof
provable in bankruptcy pursuant to Section 5.2 of the Indenture, or impair or
affect the right of any Securityholder to institute suit for the payment
thereof or the right of repayment, if any, at the option of the Securityholder
without the consent of the holder of each Security so affected, or (ii) reduce
the aforesaid percentage of Securities of any series, the consent of the
holders of which is required for any such supplemental indenture, without the
consent of the holder of each Security so affected. Any such consent or waiver
by the holder of this Note (unless revoked as provided in the Indenture) shall
be conclusive and binding upon such
6
<PAGE> 7
holder and upon all future holders and owners of this Note and any Notes which
may be issued in exchange or substitution herefor, irrespective of whether or
not any notation thereof is made upon this Note or such other Notes.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay the Maturity Amount on this Note at the
place, at the respective times, at the rate and in the coin, currency or
currency unit herein prescribed unless in accordance with Section 10.1(c) or
Section 10.2 of the Indenture, the Issuer shall have irrevocably deposited or
caused to be deposited in trust with the Trustee funds in cash and/or U.S.
Government Obligations and/or Foreign Government Securities (as defined in the
Indenture) as will be sufficient to retire this Note at maturity or upon
earlier redemption or repayment.
The Issuer shall be deemed to have paid the Maturity Amount on this
Note when the same shall have become due and payable if in accordance with
Section 10.1(c) or Section 10.2(A) the Issuer shall have irrevocably deposited
or caused to be deposited in trust with the Trustee funds in cash and/or U.S.
Government Obligations and/or Foreign Government Securities (as defined in the
Indenture) as will be sufficient to retire at maturity or upon earlier
redemption or repayment of the outstanding Notes.
The Notes are issuable in fully registered form without coupons in the
minimum denomination of U.S. $100,000 or the equivalent thereof in the
Specified Currency, and in integral multiples of U.S. $1,000 in excess thereof
or 10,000 units of the Specified Currency.
Upon due presentment for registration of transfer of this Note at the
Corporate Trust Office of the Trustee or at such other office or agency as is
designated by the Issuer in the Borough of Manhattan, The City of New York, a
new Note or Notes of authorized denominations for an equal aggregate principal
amount and like tenor will be issued to the transferee in exchange therefor,
subject to the limitations provided in the Indenture, without charge except for
any tax or other governmental charge imposed in connection therewith; provided,
however, that if this Note is a Global Note, this Note is exchangeable only if
(x) the Depositary notifies the Issuer that it is unwilling or unable to
continue as Depositary for this Note or if at any time the Depositary ceases to
be in good standing under the Securities Exchange Act of 1934, as amended, or
other applicable statutes or regulations, and the Issuer does not appoint a
successor Depositary within 90 days after the Issuer receives such notice or
becomes aware of such ineligibility, or (y) the Issuer in its sole discretion
determines that this Note shall be exchanged for certificated Notes in
definitive form, provided that the definitive Notes so issued in exchange for
this Note shall be in authorized denominations and be of like aggregate
principal amount and tenor and terms as the portion of this Note to be
exchanged.
The Issuer will pay any administrative costs imposed by banks in
connection with making payments on this Note by wire transfer, but any tax,
assessment or governmental charge imposed upon payments will be borne by the
holder hereof.
The Issuer, the Trustee and any agent of the Issuer or the Trustee may
deem and treat the registered holder hereof as the absolute owner of this Note
(whether or not this Note shall be overdue and notwithstanding any notation of
ownership or other writing thereon) for the purpose of receiving payment of or
on account of the Maturity Amount, and for all other purposes, and neither the
Issuer nor the Trustee nor any agent of the Issuer or the Trustee shall be
affected by any notice to the contrary.
No recourse under or upon any obligation, covenant or agreement
contained in the Indenture or in any Note, or because of any indebtedness
evidenced thereby, shall be had against any incorporator, stockholder, officer
or director, as such, of the Issuer or of any successor, either directly or
through the Issuer of any successor, under any rule of law, statute or
constitutional provision or by the enforcement of any assessment or by any
legal or equitable proceeding or otherwise, all such liability being expressly
waived and released by the acceptance hereof and as part of the consideration
for the Issuer hereof.
Undefined terms used herein which are defined in the Indenture shall
have the respective meanings assigned thereto in the Indenture.
7
<PAGE> 8
_____________________
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship
and not as tenants in common
UNIF GIFT
MIN ACT - ________________ Custodian __________________
(Cust) (Minor)
under Uniform Gifts to Minors Act _______________
(State)
Additional abbreviations may also be used though not in the above list.
______________________________________________________________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE ____________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS OF ASSIGNEE
___________________________________ the within Note of AIR PRODUCTS AND
CHEMICALS, INC. and hereby does irrevocably constitute and appoint
________________________________________________ Attorney to transfer the said
Note on the books of the within-named Issuer, with full power of substitution
in the premises.
Dated _______________________
________________________________________
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the certificate in every
particular, without alteration or
enlargement or any change whatever.
8
<PAGE> 1
Exhibit 5
April 12, 1996
Air Products and Chemicals, Inc.
7201 Hamilton Boulevard
Allentown, PA 18195-1501
RE: Air Products and Chemicals, Inc.--Registration Statement on
Form S-3 for $500,000,000 Principal Amount of Medium-Term Notes,
Series F
Ladies and Gentlemen:
I am an Assistant General Counsel of Air Products and Chemicals, Inc., a
Delaware corporation (the "Company"), and have acted in such capacity in
connection with the proposed issuance and sale of the Company of up to
$500,000,000 aggregate principal amount of its debt securities (the
"Securities") as described in the Registration Statement on Form S-3, filed by
the Company pursuant to the Securities Act of 1933 on April 12, 1996 (the
"Registration Statement"). The Securities are to be issued under an Indenture
dated as of January 10, 1995 (the "Indenture"), between the Company and First
Union National Bank (formerly, First Fidelity Bank, National Association), as
Trustee.
I or members of the Company's legal staff have examined original or
copies, certified or otherwise identified to our satisfaction, of such
documents, corporate records, certificates of public officials and other
instruments as were deemed necessary or advisable for the purpose of enabling
me to render this opinion.
Based upon the foregoing, in my capacity as an Assistant General Counsel
of the Company, I am of the opinion that when the Registration Statement has
become effective, and the Securities have been duly executed by the Company,
duly authenticated by the Trustee and delivered by the Company against payment
therefor in accordance with the terms of the Indenture, the Securities will be
legally issued and will constitute valid and binding obligations of the Company
in accordance with their terms (except as (a) the enforceability thereof may be
limited by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally and (b) rights of acceleration and the availability
of equitable remedies may be limited by equitable principles of general
applicability).
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Robert F. Gerkens
-------------------------------
Robert F. Gerkens
Assistant General Counsel
<PAGE> 1
Exhibit 23(b)
April 12, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549-1004
RE: Air Products and Chemicals, Inc.-- Registration
Statement on Form S-3 for $500,000,000 Principal Amount of
Medium-Term Notes, Series F
Ladies and Gentlemen:
We refer to the Registration Statement on Form S-3 of Air Products and
Chemicals, Inc. (the "Company"), filed pursuant to the Securities Act of 1933
on April 12, 1996 (the "Registration Statement"), in connection with the
proposed issuance and sale of the Company of up to $500,000,000 aggregate
principal amount of its Debt Securities and the prospectus included in the
Registration Statement which refers to us under the caption "Legal Opinions."
The undersigned hereby consent to the reference to us in such prospectus
under the caption "Legal Opinions."
Very truly yours,
/s/ James H. Agger
James H. Agger
Vice President, General Counsel
and Secretary
/s/ Robert F. Gerkens
Robert F. Gerkens
Assistant General Counsel
/s/ Cornelius P. Powell
Cornelius P. Powell
Vice President--Taxes
<PAGE> 1
Exhibit 24
MEDIUM TERM NOTES
SERIES F
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints HAROLD A. WAGNER or ARNOLD H. KAPLAN or
JAMES H. AGGER, acting severally, his/her true and lawful attorney-in-fact and
agent, with full power of substitution and resubstitution, for him/her and in
his/her name, place and stead, in any and all capacities, to sign a
Registration Statement for the registration of up to $500,000,000 aggregate
principal amount of Medium-Term Notes, Series F of Air Products and Chemicals,
Inc., and any and all amendments thereto, and to file the same, with all
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorney-in-fact and
agent full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he/she might or could do in person, hereby ratifying
and confirming all that said attorney-in-fact and agent, or his substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities and Exchange Act of
1933, this Power of Attorney has been signed below by the following persons in
the capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Harold A. Wagner Director and Chairman March 21, 1996
- ------------------------------ of the Board
(Harold A. Wagner) (Principal Executive Officer)
/s/ Dexter F. Baker Director March 21, 1996
- ------------------------------
(Dexter F. Baker)
/s/ Tom H. Barrett Director March 21, 1996
- ------------------------------
(Tom H. Barrett)
/s/ L. Paul Bremer, III Director March 21, 1996
- ------------------------------
(L. Paul Bremer, III)
/s/ Robert Cizik Director March 21, 1996
- ------------------------------
(Robert Cizik)
Director March 21, 1996
- ------------------------------
(Ruth M. Davis)
/s/ Terry R. Lautenbach Director March 21, 1996
- ------------------------------
(Terry R. Lautenbach)
/s/ Rudolphus F. M. Lubbers Director March 21, 1996
- ------------------------------
(Rudolphus F. M. Lubbers)
/s/ Judith Rodin Director March 21, 1996
- ------------------------------
(Judith Rodin)
/s/ Takeo Shiina Director March 21, 1996
- ------------------------------
(Takeo Shiina)
/s/ Lawrason D. Thomas Director March 21, 1996
- ------------------------------
(Lawrason D. Thomas)
</TABLE>
<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
PURSUANT TO SECTION 305(b)(2) ____
FIRST UNION NATIONAL BANK
(Name of Trustee)
22-1147033
(I.R.S. Employer Identification No.)
101 NORTHSIDE PLAZA, ELKTON, MARYLAND
(Address of Principal Executive Offices)
21921
(Zip Code)
AIR PRODUCTS AND CHEMICALS, INC.
(Exact name of registrants as specified in their charters)
DELAWARE
(State of Incorporation)
23-1274455
(I.R.S. Employer Identification No.)
7201 HAMILTON BOULEVARD
ALLENTOWN, PA 18195-1501
(610) 481-7351
(Address of Principal Executive Offices)
DEBT SECURITIES
Application relates to all securities registered pursuant
to the delayed offering registration statement.
(Title of Indenture Securities)
<PAGE> 2
1. GENERAL INFORMATION.
FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISORY AUTHORITY TO
WHICH IT IS SUBJECT:
Comptroller of the Currency
United States Department of the Treasury
Washington, D.C. 20219
Federal Reserve Bank (3rd District)
Philadelphia, Pennsylvania 19106
Federal Deposit Insurance Corporation
Washington, D.C. 20429
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
3. VOTING SECURITIES OF THE TRUSTEE.
FURNISH THE FOLLOWING INFORMATION AS TO EACH CLASS OF VOTING SECURITIES
OF THE TRUSTEE:
Not applicable - see answer to item 13.
4. TRUSTEESHIPS UNDER OTHER INDENTURES.
IF THE TRUSTEE IS A TRUSTEE UNDER ANOTHER INDENTURE UNDER WHICH ANY
OTHER SECURITIES, OR CERTIFICATES OF INTEREST OR PARTICIPATION IN ANY OTHER
SECURITIES, OF THE OBLIGOR ARE OUTSTANDING, FURNISH THE FOLLOWING INFORMATION:
Not applicable - see answer to item 13.
2
<PAGE> 3
5. INTERLOCKING DIRECTORATES AND SIMILAR RELATIONSHIPS WITH THE OBLIGOR OR
UNDERWRITERS.
IF THE TRUSTEE OR ANY OF THE DIRECTORS OR EXECUTIVE OFFICERS OF THE
TRUSTEE IS A DIRECTOR, OFFICER, PARTNER, EMPLOYEE, APPOINTEE, OR REPRESENTATIVE
OF THE OBLIGOR OR OF ANY UNDERWRITER FOR THE OBLIGOR, IDENTIFY EACH SUCH PERSON
HAVING ANY SUCH CONNECTION AND STATE THE NATURE OF EACH SUCH CONNECTION.
Not applicable - see answer to item 13.
6. VOTING SECURITIES OF THE TRUSTEE OWNED BY THE OBLIGOR OR ITS OFFICIALS.
FURNISH THE FOLLOWING INFORMATION AS TO THE VOTING SECURITIES OF THE
TRUSTEE OWNED BENEFICIALLY BY THE OBLIGOR AND EACH DIRECTOR, PARTNER, AND
EXECUTIVE OFFICER OF THE OBLIGOR:
Not applicable - see answer to item 13.
7. VOTING SECURITIES OF THE TRUSTEE OWNED BY UNDERWRITERS OR THEIR
OFFICIALS.
FURNISH THE FOLLOWING INFORMATION AS TO THE VOTING SECURITIES OF THE
TRUSTEE OWNED BENEFICIALLY BY EACH UNDERWRITER FOR THE OBLIGOR AND EACH
DIRECTOR, PARTNER, AND EXECUTIVE OFFICER OF EACH SUCH UNDERWRITER:
Not applicable - see answer to item 13.
8. SECURITIES OF THE OBLIGOR OWNED OR HELD BY THE TRUSTEE.
FURNISH THE FOLLOWING INFORMATION AS TO SECURITIES OF THE OBLIGOR OWNED
BENEFICIALLY OR HELD AS COLLATERAL SECURITY FOR OBLIGATIONS IN DEFAULT BY THE
TRUSTEE:
Not applicable - see answer to item 13.
9. SECURITIES OF UNDERWRITERS OWNED OR HELD BY THE TRUSTEE.
IF THE TRUSTEE OWNS BENEFICIALLY OR HOLDS AS COLLATERAL SECURITY FOR
OBLIGATIONS IN DEFAULT ANY SECURITIES OF AN UNDERWRITER FOR THE OBLIGOR, FURNISH
THE FOLLOWING INFORMATION AS TO EACH CLASS OF SECURITIES OF SUCH UNDERWRITER ANY
OF WHICH ARE SO OWNED OR HELD BY THE TRUSTEE:
Not applicable - see answer to item 13.
3
<PAGE> 4
10. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF VOTING SECURITIES OF CERTAIN
AFFILIATES OR SECURITY HOLDERS OF THE OBLIGOR.
IF THE TRUSTEE OWNS BENEFICIALLY OR HOLDS AS COLLATERAL SECURITY FOR
OBLIGATIONS IN DEFAULT VOTING SECURITIES OF A PERSON WHO, TO THE KNOWLEDGE OF
THE TRUSTEE (1) OWNS 10 PERCENT OR MORE OF THE VOTING STOCK OF THE OBLIGOR OR
(2) IS AN AFFILIATE, OTHER THAN A SUBSIDIARY, OF THE OBLIGOR, FURNISH THE
FOLLOWING INFORMATION AS TO THE VOTING SECURITIES OF SUCH PERSON:
Not applicable - see answer to item 13.
11. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF ANY SECURITIES OF A PERSON
OWNING 50 PERCENT OR MORE OF THE VOTING SECURITIES OF THE OBLIGOR.
IF THE TRUSTEE OWNS BENEFICIALLY OR HOLDS AS COLLATERAL SECURITY FOR
OBLIGATIONS IN DEFAULT ANY SECURITIES OF A PERSON WHO, TO THE KNOWLEDGE OF THE
TRUSTEE, OWNS 50 PERCENT OR MORE OF THE VOTING SECURITIES OF THE OBLIGOR,
FURNISH THE FOLLOWING INFORMATION AS TO EACH CLASS OF SECURITIES OF SUCH PERSON
ANY OF WHICH ARE SO OWNED OR HELD BY THE TRUSTEE:
Not applicable - see answer to item 13.
12. INDEBTEDNESS OF THE OBLIGOR TO THE TRUSTEE.
EXCEPT AS NOTED IN THE INSTRUCTIONS, IF THE OBLIGOR IS INDEBTED TO THE
TRUSTEE, FURNISH THE FOLLOWING INFORMATION:
Not applicable - see answer to item 13.
13. DEFAULTS BY THE OBLIGOR.
(a) STATE WHETHER THERE IS OR HAS BEEN A DEFAULT WITH RESPECT TO THE
SECURITIES UNDER THIS INDENTURE. EXPLAIN THE NATURE OF ANY SUCH DEFAULT.
None.
(b) IF THE TRUSTEE IS A TRUSTEE UNDER ANOTHER INDENTURE UNDER WHICH ANY
OTHER SECURITIES, OR CERTIFICATES OF INTEREST OR PARTICIPATION IN ANY OTHER
SECURITIES, OF THE OBLIGOR ARE OUTSTANDING, OR IS TRUSTEE FOR MORE THAN ONE
OUTSTANDING SERIES OF SECURITIES UNDER THE INDENTURE, STATE WHETHER THERE HAS
BEEN A DEFAULT UNDER ANY SUCH INDENTURE OR SERIES, IDENTIFY THE INDENTURE OR
SERIES AFFECTED, AND EXPLAIN THE NATURE OF ANY SUCH DEFAULT.
None.
4
<PAGE> 5
14. AFFILIATIONS WITH THE UNDERWRITERS.
IF ANY UNDERWRITER IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
Not applicable - see answer to item 13.
15. FOREIGN TRUSTEE.
IDENTIFY THE ORDER OR RULE PURSUANT TO WHICH THE TRUSTEE IS AUTHORIZED
TO ACT AS SOLE TRUSTEE UNDER INDENTURES QUALIFIED OR TO BE QUALIFIED UNDER THE
ACT.
Not applicable - trustee is a national banking association organized
under the laws of the United States.
16. LIST OF EXHIBITS.
LIST BELOW ALL EXHIBITS FILED AS PART OF THIS STATEMENT OF ELIGIBILITY.
X 1. Copy of Articles of Association of the trustee as now in
--- effect.
--- 2. Copy of the Certificate of the Comptroller of the Currency
dated January 11, 1994, evidencing the authority of the trustee
to transact business.*
--- 3. Copy of the authorization of the trustee to exercise fiduciary
powers.*
X 4. Copy of existing by-laws of the trustee.
---
--- 5. Copy of each indenture referred to in Item 4, if the obligor is
in default, not applicable.
X 6. Consent of the trustee required by Section 321(b) of the Act.
---
X 7. Copy of report of condition of the trustee at the close of
--- business on December 31, 1996, published pursuant to the
requirements of its supervising authority.
--- 8. Copy of any order pursuant to which the foreign trustee is
authorized to act as sole trustee under indentures qualified or
to be qualified under the Act, not applicable.
5
<PAGE> 6
9. Consent to service of process required of foreign trustees
- --- pursuant to Rule 10a-4 under the Act, not applicable.
- ---------------------
*Previously filed with the Securities and Exchange Commission on
February 11, 1994 as an exhibit to Form T-1 in connection with Registration
Statement No. 22-73340 and incorporated herein by reference.
NOTE
The trustee disclaims responsibility for the accuracy or completeness
of information contained in this Statement of Eligibility and Qualification not
known to the trustee and not obtainable by it through reasonable investigation
and as to which information it has obtained from the obligor and has had to rely
or will obtain from the principal underwriters and will have to rely.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
trustee, First Union National Bank, a national banking association organized and
existing under the laws of the United States of America, has duly caused this
Statement of Eligibility to be signed on its behalf by the undersigned,
thereunto duly authorized, all in the City of Elkton and State of Maryland, on
the 11th day of April, 1996.
FIRST UNION NATIONAL BANK
By: /s/John H. Clapham
------------------
John H. Clapham
Vice President
6
<PAGE> 7
EXHIBIT 1
FIRST UNION NATIONAL BANK (EFF. 1/1/96)
(formerly First Fidelity Bank, National Association)
BYLAWS
ADOPTED: JANUARY 10, 1994; AMENDED APRIL 19, 1994
------------------------------
ARTICLE I
Meetings of Shareholders
Section 1.1. Annual Meeting. The regular annual meeting of the shareholders
for the election of directors and transaction of whatever other business may
properly come before the meeting, shall be held at the Main Office of the
Association, or such other place as the Board of Directors may designate, at
10:00 A.M., on the second Thursday of April of each year or such other time
within 90 days as may be set by the Board of Directors. If, from any cause, an
election of directors is not made on the said day, the Board of Directors shall
order the election to be held on some subsequent day, as soon thereafter as
practicable, according to the provisions of the law; and notice thereof shall be
given in the manner herein provided for the annual meeting.
Section 1.2. Special Meetings. Except as otherwise specifically provided by
statute, special meetings of the shareholders may be called for any purpose at
any time by the Board of Directors or by any one or more shareholders owning, in
the aggregate, not less than twenty-five percent of the stock of the
Association.
Section 1.3. Notice of Meetings. Notice of Annual and Special meetings
shall be mailed, postage prepaid, at least ten days prior to the date thereof,
addressed to each shareholder at his address appearing on the books of the
Association; but any failure to mail such notice, or any irregularity therein,
shall not affect the validity of such meeting, or of any of the proceedings
thereat. A shareholder may waive any such notice.
Section 1.4. Organization of Meetings. The Chairman shall preside at all
meetings of shareholders. In his absence, the President, or a director
designated by the Chairman shall preside at such meeting.
<PAGE> 8
Section 1.5. Proxies. Shareholders may vote at any meeting of the
shareholders by proxies duly authorized in writing. Proxies shall be valid only
for one meeting to be specified therein, and any adjournments of such meeting.
Proxies shall be dated and shall be filed with the records of the meeting.
Section 1.6. Quorum. A majority of the outstanding capital stock,
represented in person or by proxy, shall constitute a quorum at any meeting of
shareholders, unless otherwise provided by law. A majority of the votes cast
shall decide every question or matter submitted to the shareholders at any
meeting, unless otherwise provided by law or by the Articles of Association.
ARTICLE II
Directors
Section 2.1. Board of Directors. The Board of Directors (hereinafter
referred to as the "Board"), shall have power to manage and administer the
business and affairs of the Association. Except as expressly limited by law,
all corporate powers of the Association shall be vested in and may be exercised
by said Board.
Section 2.2. Number. The Board shall consist of not less than five
nor more than twenty-five persons, the exact number within such minimum and
maximum limits to be fixed and determined from time to time by resolution of a
majority of the full Board or by resolution of the shareholders at any meeting
thereof; provided, however, that a majority of the full Board may not increase
the number of directors to a number which: (a) exceeds by more than two the
number of directors last elected by shareholders where such number was fifteen
or less; and (b) to a number which exceeds by more than four the number of
directors last elected by shareholders where such number was sixteen or more,
but in no event shall the number of directors exceed twenty-five.
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Section 2.3. Organization Meeting. A meeting shall be held for the
purpose of organizing the new Board and electing and appointing officers of the
Association for the succeeding year on the day of the Annual Meeting of
Shareholders or as soon thereafter as practicable, and, in any event, within
thirty days thereof. If, at the time fixed for such meeting, there shall not be
a quorum present, the directors present may adjourn the meeting, from time to
time, until a quorum is obtained.
Section 2.4. Regular Meetings. The regular meetings of the Board shall
be held on such days and time as the directors may, by resolution, designate;
and written notice of any change thereof shall be sent to each member. When any
regular meeting of the Board falls upon a legal holiday, the meeting shall be
held on such other day as the Board may designate.
Section 2.5. Special Meetings. Special meetings of the Board may be
called by the Chairman of the Board, or President, or at the request of three
or more directors. Each director shall be given notice of each special meeting,
except the organization meeting, at least one day before it is to be held by
facsimile, telephone, telegram, letter or in person. Any director may waive any
such notice.
Section 2.6. Quorum. A majority of the directors shall constitute a
quorum at any meeting, except when otherwise provided by law; but a less number
may adjourn any meeting, from time to time, and the meeting may be held, as
adjourned without further notice.
Section 2.7. Term of Office and Vacancy. Directors shall hold office
for one year and until their successors are elected and have qualified. No
person shall stand for election as a director of this Association if at the
date of his election he will have passed his seventieth birthday; provided,
however, this prohibition shall not apply to persons who are active officers
of this Association, an affiliate bank, or its parent corporation, or a former
chief executive officer of the Association. No person, who is not an officer or
former officer of this Association, an affiliate bank, or its parent
corporation and who has discontinued the principal position or activity the
person held when
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initially elected, shall be recommended to the shareholders for reelection;
provided, however, that exceptions may be made because of a change in principal
position or activity which would be compatible with continued service to this
Association. No person elected as a director may exercise any of the powers of
his office until he has taken the oath of office as prescribed by law. When any
vacancy occurs among the directors, the remaining members of the Board, in
accordance with the laws of the United States, may appoint a director to fill
such vacancy at any regular meeting of the Board, or at a special meeting called
for that purpose.
Section 2.8. Nominations. Nominations for election to the Board may be
made by the Executive Committee or by any stockholder of any outstanding class
of capital stock of the Association entitled to vote for the election of
directors.
Section 2.9. Communications Equipment. Any or all directors may
participate in a meeting of the Board by means of conference telephone or any
means of communication by which all persons participating in the meeting are
able to hear each other.
Section 2.10. Action Without Meeting. Any action required or permitted
to be taken by the Board or committee thereof by law, the Association's Articles
of Association, or these Bylaws may be taken without a meeting, if, prior or
subsequent to the action, all members of the Board or committee shall
individually or collectively consent in writing to the action. Each written
consent or consents shall be filed with the minutes of the proceedings of the
Board or committee. Action by written consent shall have the same force and
effect as a unanimous vote of the directors, for all purposes. Any certificate
or other documents which relates to action so taken shall state that the action
was taken by unanimous written consent of the Board or committee without a
meeting.
ARTICLE III
Committees of the Board
Section 3.1. Executive Committee. The Board may by resolution
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adopted by a majority of the entire Board designate an Executive Committee
consisting of the Chairman of the Board, the President, and not less than two
other directors. Subject to the national banking laws and the Association's
Articles of Association, the Executive Committee may exercise all the powers of
the Board of Directors with respect to the affairs of the Association, except
that the Executive Committee may not:
1. (a) exercise such powers while a quorum of the Board of Directors is
actually convened for the conduct of business,
(b) exercise any power specifically required to be exercised by at
least a majority of all the directors,
(c) act on matters committed by the Bylaws or resolution of the
Board of Directors to another committee of the board, or
(d) amend or repeal any resolution theretofore adopted by the Board
of Directors which by its terms is amendable or repealable only by the Board;
2. amend the Articles of Association or make, alter or repeal any Bylaw
of the Association;
3. elect or appoint any director, create or fill any vacancies in the
Board of Directors or remove any director, or authorize or approve any change
in the compensation of any officer of the Association who is also a director of
the Association;
4. authorize or approve issuance or sale or contract for sale of shares
of stock of the Association, or determine the designation and relative rights,
preferences and limitations of a class or series of shares;
5. adopt an agreement of merger or consolidation, or submit to
shareholders any action that requires shareholder approval, including any
recommendation to the shareholders concerning the sale, lease or exchange of
all or substantially all the Association's property and assets, a dissolution
of the Association or a revocation of a previously approved dissolution; or
6. authorize an expenditure by the Association in excess of $10 million
for any one item or group of related items.
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The committee shall hold regular meetings at such times as the members shall
agree and whenever called by the chairman of the committee. A majority of the
committee shall constitute a quorum for the transaction of business. The
committee shall keep a record of its proceedings and shall report these
proceedings to the Board at the regular meetings thereof. The committee shall
serve as the nominating committee for nominations to the Board. The committee
shall provide oversight on all Community Reinvestment Act ("CRA") matters
pertaining to the Association. The committee shall also be responsible for
monitoring the CRA activities of the Association on an on-going basis and
making periodic reports on such CRA activity to the Board.
Section 3.2. Chairman of the Executive Committee. The Board may
designate one of its members to be Chairman of the Executive Committee who
shall preside at the meetings thereof and shall perform such duties as the
Board shall assign to him from time to time.
Section 3.3. Audit Committee. The Board shall appoint a committee of
three or more persons exclusive of the officers of this Association which
committee shall be known as the Audit Committee. It shall be the duty of his
committee at least once in every twelve months to examine the affairs of the
Association, and determine whether it is in a sound and solvent condition and
to recommend to the Board such changes in the manner of doing business, etc.,
as may seem to be desirable. The committee may cause such examination to be
made in its behalf and under its supervision by outside accountants and may
also use the services of any other persons either inside or outside the
Association to assist in its work. The results of such examination shall be
reported in writing to the Board.
Section 3.4. Audit of Trust Department. The Audit Committee shall, at
least once during each calendar year and within fifteen months of the last such
audit make suitable audits of the Trust Department or cause suitable audits to
be made by auditors responsible only to the Board, and at such time shall
ascertain whether the department has been administered in accordance with law,
Part 9 of the Regulations of the Comptroller of the Currency, and sound
fiduciary principles. In lieu of such periodic
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audit the Audit Committee, at the election of the Board, may conduct or cause
to be conducted by auditors responsible only to the Board an adequate
continuous audit system adopted by the Board. A written report of such periodic
or continuous audit shall be made to the Board.
Section 3.5. Other Committees. The Board may appoint from time to time
other committees composed of one or more persons each, for such purposes and
with such powers as the Board may determine. The Chairman of the Board shall
have the power to designate another person to serve on any committee during the
absence or inability of any member thereof so to serve.
Section 3.6. Directors' Emeritus. The Board may designate one or more
persons to serve as Director Emeritus. Such Director Emeritus shall have the
right to attend any and all meetings of the Board, but shall have no vote at
such meetings. A person designated as Director Emeritus may serve in that
capacity for a period of three years.
Section 3.7. Alternate Committee Members. The Board may, from time to
time, appoint one or more, but no more than three persons to serve as alternate
members of a committee, each of whom shall be empowered to serve on that
committee in place of a regular committee member in the event of the absence or
disability of that committee member. An alternate committee member shall, when
serving on a committee, have all of the powers of a regular committee member.
Alternate committee members shall be notified of, and requested to serve at, a
particular meeting or meetings, or for particular periods of time, by or at the
direction of the chairman of the committee or the Chairman of the Board.
ARTICLE IV
Officers
Section 4.1a. Appointment. The senior officers of this Association
shall be chosen by the Board and shall be the Chairman of the Board, one
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or more Vice Chairmen, the President, the Chief Financial Officer and such other
officers as in the judgment of the Board may be from time to time required. The
Chairman of the Board and the President shall be chosen from the Directors. The
Board may designate a person to serve as secretary of all meetings of the Board
and of the shareholders and the persons so designated shall keep accurate
minutes of such meetings.
Section 4.1b. Other Officers. The Chairman, the President, the Chief
Executive Officer, any Vice Chairman or any Senior Executive Vice President may
appoint such other officers with such titles and duties as he may designate.
Section 4.2. Term of Office. The officers who are required by the
articles of association or the bylaws to be members of the Board shall hold
their respective offices until the Organization meeting of the Board following
the annual meeting of shareholders or until their respective successors shall
have been elected, unless they shall resign, become disqualified or be removed
from office. Each other officer shall hold office at the pleasure of the Board.
Any officer may be removed at any time by the Board.
Section 4.3. Chairman of the Board. The chairman of the board shall be
designated as Chairman of the Board. He shall preside at all meetings of the
stockholders and directors and he shall be a member of all committees of the
Board except the Audit Committee. He shall have such other powers and perform
such other duties as may be prescribed from time to time by the Board. He shall
be subject only to the direction and control of the Board.
Section 4.4. President. The president shall be the chief executive
officer of the Association and he shall be designated as President and Chief
Executive Officer. In the absence of the Chairman the President shall preside at
all meetings of the Board. The President shall be a
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member of each committee of the Board except the Audit Committee. He shall have
the powers and perform the duties conferred or imposed upon the President by
the national banking laws, and he shall have such other powers and perform such
other duties as may from time to time be imposed upon or assigned to him by the
Board.
Section 4.5. Chief Financial Officer. The Chief Financial Officer shall
have such title as may be designated by the Board and he shall be responsible
for all monies, funds and valuables of this Association, provide for the
keeping of proper records of all transactions of the Association, report to the
Board at each regular meeting the condition of the Association, submit to the
Board, when requested, a detailed statement of the income and expenses, be
responsible for the conduct and efficiency of all persons employed under him,
and perform such other duties as may be from time to time assigned to him by
the Board.
Section 4.6. Other Officers. All other officers shall respectively
exercise such powers and perform such duties as generally pertain to their
several offices, or as may be conferred upon or assigned to them by the Board,
the Chairman of the Board or the President.
Section 4.7. Bond. Each officer and employee, if so required by the
Board, shall give bond with surety to be approved by the Board, conditioning
for the honest discharge of his duties as such officer or employee. In the
discretion of the Board, such bonds may be individual, schedule or blanket
form, and the premiums may be paid by the Association.
ARTICLE V
Trust Department
Section 5.1. Trust Department. There shall be a department of the
Association known as the Trust Department which shall perform the fiduciary
responsibilities of the Association.
Section 5.2. Trust Officer. There shall be a Trust Officer of this
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Association whose duties shall be to manage, supervise and direct all the
activities of the Trust Department. Such persons shall do or cause to be done
all things necessary or proper in carrying on the business of the Trust
Department in accordance with the provisions of law and applicable regulations;
and shall act pursuant to opinion of counsel where such opinion is deemed
necessary. Opinions of counsel shall be retained on file in connection with all
important matters pertaining to fiduciary activities. The Trust Officer shall be
responsible for all assets and documents held by the Association in connection
with fidicuary matters. The Trust Officer shall perform such other duties and
possess such other powers as from time to time shall be delegated to him by the
Chief Executive Officer, the Board, the Executive Committee or these bylaws. The
President may appoint such other officers of the Trust Department as it may deem
necessary or advisable with such duties as may be assigned and with such titles
as may be designated.
Section 5.3. Trust Investment. Funds held in a fiduciary capacity
shall be invested in accordance with the instrument establishing the fidicuary
relationship and local law. Where such instrument does not specify the character
and class of the investments to be made and does not vest in the Association a
discretion in the matter, funds held pursuant to such investment shall be
invested in investments in which corporate fiduciaries may invest under local
law.
ARTICLE VI
STOCK CERTIFICATES AND TRANSFERS
Section 6.1. Stock Certificates. Ownership of capital stock of the
Association shall be evidenced by certificates of stock signed by the
Chairman or President, and the Secretary, or an Assistant Secretary. Each
certificate shall state upon its face that the stock is transferable only
upon the books of the Association by the holder thereof, or by duly authorized
attorney, upon the surrender of such certificate, and shall
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meet the requirements of Section 5139, United States Revised Statutes, as
amended.
Section 6.2. Transfers. The stock of this Association shall be
assignable and transferable only on the books of this Association, subject to
the restrictions and provisions of the national banking laws; and a transfer
book shall be provided in which all assignments and transfers of stock shall be
made. When stock is transferred, the certificates thereof shall be returned to
the Association, canceled, preserved and new certificates issued.
Section 6.3. Dividends. Dividends shall be paid to the shareholders in
whose names the stock shall stand at the close of business on the day next
preceding the date when the dividends are payable, provided, however, that the
directors may fix another date as a record date for the determination of the
shareholders entitled to receive payment thereof.
ARTICLE VII
Increase of Stock
Section 7.1. Capital Stock. Shares of the capital stock of the
Association, which have been authorized but not issued, may be issued from time
to time for such consideration, not less than the par value thereof, as may be
determined by the Board.
ARTICLE VIII
Corporate Seal
Section 8.1. Seal. The seal, an impression of which appears below, is
the seal of the Association as adopted by the Board of Directors:
[SEAL]
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The Chairman of the Board, the Vice Chairman, the President, Senior
Executive Vice President, Executive Vice President, Senior Vice President, Vice
President, each Assistant Vice President, the Chief Financial Officer, the
Secretary, each Assistant Secretary, each Trust Officer, each Assistant Trust
Officer or each Assistant Cashier, shall have the authority to affix the
corporate seal of this Association and to attest to the same.
ARTICLE IX
Miscellaneous Provisions
Section 9.1. Fiscal Year. The fiscal year of the Association shall be
the calendar year.
Section 9.2. Execution of Instruments. All agreements, contracts,
indentures, mortgages, deeds, conveyances, transfers, certificates,
declarations, receipts, discharges, releases, satisfactions, settlements,
petitions, schedules, accounts, affidavits, bonds, undertakings, proxies and
other instruments or documents may be signed, executed, acknowledged, verified,
delivered or accepted in behalf of the Association by the Chairman of the
Board, or any Vice Chairman, or the President, or Senior Executive Vice
President, or Executive Vice President, or Senior Vice President, or Vice
President, or Assistant Vice President, or Chief Financial Officer, or the
Secretary, or Assistant Secretary, or, if in connection with the exercise of
fiduciary powers of the Association, by any of said officers or by any Trust
Officer or Assistant Trust Officer, to the extent authorized by the corporate
policy of the Association, as adopted and modified from time to time. Any such
instruments may also be executed, acknowledged, verified, delivered, or
accepted in behalf of the Association in such other manner and by such other
officers as the Board may from time to time direct.
Section 9.3. Records. The organization papers of this Association,
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the articles of association, the bylaws and any amendments thereto, the
proceedings of all regular and special meetings of the shareholders and of the
directors, the returns of the judges of elections, and the reports of the
committees of directors shall be recorded in an appropriate minute book, and the
minutes of each meeting shall be signed by the Secretary or any other officer
appointed to act as secretary of the meeting.
Section 9.4. Banking Hours. This Association and its branch offices
shall be open on such days and during such hours as shall be fixed from time to
time by the Board.
Section 9.5. Voting Shares of Other Corporations. The Chairman, any Vice
Chairman, the President, or any Vice President is authorized to vote, represent
and exercise on behalf of this Association all rights incident to any and all
shares of stock of any other corporation standing in the name of the
Association. The authority granted herein may be exercised by such officers in
person or by proxy or by power of attorney duly executed by said officer.
ARTICLE X
Bylaws
Section 10.1. Inspection. A copy of the Bylaws, with all amendments
thereto, shall at all times be kept in a convenient place at the Head Office of
the Association, and shall be open for inspection to all shareholders, during
banking hours.
Section 10.2. Amendments. These Bylaws may be changed or amended at any
regular or special meeting of the Board by the vote of a majority of the
Directors.
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EXHIBIT 4
FIRST UNION NATIONAL BANK
ARTICLES OF ASSOCIATION
(EFFECTIVE JANUARY 1, 1996)
For purposes of organizing an Association to carry on the business of
banking under the laws of the United States, the undersigned do enter into the
following Articles of Association:
FIRST. The title of this Association shall be First Union National Bank.
SECOND. The Main Office of the Association shall be in Elkton, County
of Cecil, State of Maryland. The general business of the Association shall be
conducted at its main office and its branches.
THIRD. The Board of Directors of this Association shall consist of not
less than five nor more than twenty-five persons, the exact number to be fixed
and determined from time to time by resolution of a majority of the full Board
of Directors or by resolution of the shareholders at any annual or special
meeting thereof. Each Director, during the full term of his directorship, shall
own a minimum of (a) $1,000 par value of stock of this Association or (b)
preferred or common stock of First Fidelity Bancorporation having (i) aggregate
par value equal to or greater than $1,000, (ii) aggregate shareholders' equity
equal to or greater than $1,000 or (iii) aggregate fair market value equal to
or greater than $1,000. Any vacancy in the Board of Directors may be filled by
action of the Board of Directors.
FOURTH. There shall be an annual meeting of the shareholders the
purpose of which shall be the election of Directors and the transaction of
whatever other business may be brought before said meeting. It shall be held at
the main office or other convenient place as the Board of Directors may
designate, on the day of each year specified therefor in the By-laws, but if no
election is held on that day, it may be held on any subsequent day according to
such lawful rules as may be presented by the
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Board of Directors.
FIFTH. (A) General. The amount of capital stock of this Association
shall be (i) 25,000,000 shares of common stock of the par value of twenty
dollars ($20.00) each (the "Common Stock") and (ii) 160,540 shares of preferred
stock of the par value of one dollar ($1.00) each (the "Non-Cumulative
Preferred Stock"), having the rights, privileges and preferences set forth
below, but said capital stock may be increased or decreased from time to time
in accordance with the provisions of the laws of the United States.
(B) Terms of the Non-Cumulative Preferred Stock.
1. General. Each share of Non-Cumulative Preferred Stock shall be
identical in all respects with the other shares of Non-Cumulative Preferred
Stock. The authorized number of shares of Non-Cumulative Preferred Stock may
from time to time be increased or decreased (but not below the number then
outstanding) by the Board of Directors. Shares of Non-Cumulative Preferred
Stock redeemed by the Association shall be canceled and shall revert to
authorized but unissued shares of Non-Cumulative Preferred Stock.
2. Dividends.
(a) General. The holders of Non-Cumulative Preferred Stock shall be
entitled to receive, when, as and if declared by the Board of Directors, but
only out of funds legally available therefor, non-cumulative cash dividends at
the annual rate of $83.75 per share, and no more, payable quarterly on the
first days of December, March, June and September, respectively, in each year
with respect to the quarterly dividend period (or portion thereof) ending on
the day preceding such respective dividend payment date, to shareholders of
record on the respective date, not exceeding fifty days preceding such dividend
payment date, fixed for that purpose by the Board of Directors in advance of
payment of each particular
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dividend. Notwithstanding the foregoing, the cash dividend to be paid on the
first dividend payment date after the initial issuance of Non-Cumulative
Preferred Stock and on any dividend payment date with respect to a partial
dividend period shall be $83.75 per share multiplied by the fraction produced by
dividing the number of days since such initial issuance or in such partial
dividend period, as the case may be, by 360.
(b) Non-Cumulative Dividends. Dividends on the shares of Non-Cumulative
Stock shall not be cumulative and no rights shall accrue to the holders of
shares of Non-Cumulative Preferred Stock by reason of the fact that the
Association may fail to declare or pay dividends on the shares of Non-Cumulative
Preferred Stock in any amount in any quarterly dividend period, whether or not
the earnings of the Association in any quarterly dividend period were sufficient
to pay such dividends in whole or in part, and the Association shall have no
obligation at any time to pay any such dividend.
(c) Payment of Dividends. So long as any share of Non-Cumulative
Preferred Stock remains outstanding, no dividend whatsoever shall be paid or
declared and no distribution made on any junior stock other than a dividend
payable in junior stock, and no shares of junior stock shall be purchased,
redeemed or otherwise acquired for consideration by the Association, directly or
indirectly (other than as a result of a reclassification of junior stock, or the
exchange or conversion of one junior stock for or into another junior stock, or
other than through the use of the proceeds of a substantially contemporaneous
sale of other junior stock), unless all dividends on all shares of
Non-Cumulative Preferred Stock and non-cumulative Preferred Stock ranking on a
parity as to dividends with the shares of Non-Cumulative Preferred Stock for the
most recent dividend period ended prior to the date of such payment or
declaration shall have been paid in full and all dividends on all shares of
cumulative Preferred Stock ranking on a parity as to dividends with the
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shares of Non-Cumulative Preferred Stock for the most recent dividend period
ended prior to the date of such payment or declaration shall have been paid in
full and all dividends on all shares of Non-Cumulative Stock (not withstanding
that dividends on such stock are cumulative) for all past dividend periods
shall have been paid in full. Subject, to the foregoing, and not otherwise,
such dividends (payable in cash, stock or otherwise) as may be determined by
the Board of Directors may be declared and paid on any junior stock from time
to time out of any funds legally available therefor, and the Non-Cumulative
Stock shall not be entitled to participate in any such dividends, whether
payable in cash, stock or otherwise. No dividends shall be paid or declared upon
any shares of any class or series of stock of the Association ranking on a
parity (whether dividends on such stock are cumulative or non-cumulative) with
the Non-Cumulative Preferred Stock in the payment of dividends for any period
unless at or prior to the time of such payment or declaration all dividends
payable on the Non-Cumulative Preferred Stock for the most recent dividend
period ended prior to the date of such payment or declaration shall have
been paid in full. When dividends are not paid in full, as aforesaid, upon the
Non-Cumulative Preferred Stock and any other series of Preferred Stock ranking
on a parity as to dividends (whether dividends on such stock are cumulative or
non-cumulative) with the Non-Cumulative Preferred Stock, all dividends declared
upon the Non-Cumulative Preferred Stock and any other series of Preferred Stock
ranking on a parity as to dividends with the Non-Cumulative Preferred Stock
shall be declared pro rata so that the amount of dividends declared per share
on the Non-Cumulative Preferred Stock and such other Preferred Stock shall in
all cases bear to each other the same ratio that accrued dividends per share
on the Non-Cumulative Preferred Stock (but without any accumulation in respect
of any unpaid dividends for prior dividend periods on the shares of
Non-Cumulative Stock) and such other Preferred Stock bear to
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each other. No interest, or sum of money in lieu of interest, shall be payable
in respect of any dividend payment or payments on the Non-Cumulative Preferred
Stock which may be in arrears.
3. Voting. The holders of Non-Cumulative Preferred Stock shall not have
any right to vote for the election of directors or for any other purpose.
4. Redemption.
(a) Optional Redemption. The Association, at the option of the Board of
Directors, may redeem the whole or any part of the shares of Non-Cumulative
Preferred Stock at the time outstanding, at any time or from time to time after
the fifth anniversary of the date of original issuance of the Non-Cumulative
Preferred Stock, upon notice given as hereinafter specified, at the redemption
price per share equal to $1,000 plus an amount equal to the amount of accrued
and unpaid dividends from the immediately preceding dividend payment date (but
without any accumulation for unpaid dividends for prior dividend periods on the
shares of Non-Cumulative Preferred Stock) to the redemption date.
(b) Procedures. Notice of every redemption of shares of Non-Cumulative
Preferred Stock shall be mailed by first class mail, postage prepaid, addressed
to the holders of record of the shares to be redeemed at their respective last
addresses as they shall appear on the books of the Association. Such mailing
shall be at least 10 days and not more than 60 days prior to the date fixed for
redemption. Any notice which is mailed in the manner herein provided shall be
conclusively presumed to have been duly given, whether or not the shareholder
receives such notice, and failure duly to give such notice by mail, or any
defect in such notice, to any holder of shares of Non-Cumulative Preferred
Stock designated for redemption shall not affect the validity of the
proceedings for the redemption of any other shares of Non-Cumulative Preferred
Stock.
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In case of redemption of a part only of the shares of Non-Cumulative
Preferred Stock at the time outstanding the redemption may be either pro rata
or by lot or by such other means as the Board of Directors of the Association
in its discretion shall determine. The Board of Directors shall have full
power and authority, subject to the provisions herein contained, to prescribe
the terms and conditions upon which shares of the Non-Cumulative Preferred
Stock shall be redeemed from time to time.
If notice of redemption shall have been duly given, and, if on or
before the redemption date specified therein, all funds necessary for such
redemption shall have been set aside by the Association, separate and apart
from its other funds, in trust for the pro rata benefit of the holders of the
shares called for redemption, so as to be and continue to be available
therefor, then, notwithstanding that any certificate for shares so called for
redemption shall not have been surrendered for cancellation, all shares so
called for redemption shall no longer be deemed outstanding on and after such
redemption date, and all rights with respect to such shares shall forthwith on
such redemption date cease and terminate, except only the right of the holders
thereof to receive the amount payable on redemption thereof, without interest.
If such notice of redemption shall have been duly given or if the
Association shall have given to the bank or trust company hereinafter referred
to irrevocable authorization promptly to give such notice, and, if on or before
the redemption date specified therein, the funds necessary for such redemption
shall have been deposited by the Association with such bank or trust company in
trust for the pro rata benefit of the holders of the shares called for
redemption, then, notwithstanding that any certificate for shares so called for
redemption shall not have been surrendered for cancellation, from and after
the time of such deposit, all shares so called for redemption shall no longer
be deemed to be
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outstanding and all rights with respect to such shares shall forthwith cease
and terminate, except only the right of the holders thereof to receive from
such bank or trust company at any time after the time of such deposit the funds
so deposited, without interest. The aforesaid bank or trust company shall be
organized and in good standing under the laws of the United States of America
or any state thereof, shall have capital, surplus and undivided profits
aggregating at least $50,000,000 according to its last published statement of
condition, and shall be identified in the notice of redemption. Any interest
accrued on such funds shall be paid to the Association from time to time. In
case fewer than all the shares of Non-Cumulative Preferred Stock represented by
a stock certificate are redeemed, a new certificate shall be issued
representing the unredeemed shares without cost to the holder thereof.
Any funds so set aside or deposited, as the case may be, and unclaimed
at the end of the relevant escheat period under applicable state law from such
redemption date shall, to the extent permitted by law, be released or repaid
to the Association, after which repayment the holders of the shares so called
for redemption shall look only to the Association for payment thereof.
5. Liquidation.
(a) Liquidation Preference. In the event of any voluntary
liquidation, dissolution or winding up of the affairs of the Association,
the holders of Non-Cumulative Preferred Stock shall be entitled, before
any distribution or payment is made to the holders of any junior stock,
to be paid in full an amount per share equal to an amount equal to $1,000
plus an amount equal to the amount of accrued and unpaid dividends per share
from the immediately preceding dividend payment date (but without any
accumulation for unpaid dividends for prior dividend periods on the shares
of Non-Cumulative Preferred Stock) per share to such distribution or payment
date (the "liquidation amount").
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In the event of any involuntary liquidation, dissolution or winding up
of the affairs of the Association, then, before any distribution or payment
shall be made to the holders of any junior stock, the holders of Non-Cumulative
Preferred Stock shall be entitled to be paid in full an amount per share equal
to the liquidation amount.
If such payment shall have been made in full to all holders of shares of
Non-Cumulative Preferred Stock, the remaining assets of the Association shall be
distributed among the holders of junior stock, according to their respective
rights and preferences and in each case according to their respective numbers of
shares.
(b) Insufficient Assets. In the event that, upon any such voluntary or
involuntary liquidation, dissolution or winding up, the available assets of the
Association are insufficient to pay such liquidation amount on all outstanding
shares of Non-Cumulative Preferred Stock, then the holders of Non-Cumulative
Preferred Stock shall share ratably in any distribution of assets in proportion
to the full amounts to which they would otherwise be respectively entitled.
(c) Interpretation. For the purposes of this paragraph 5, the
consolidation or merger of the Association with any other corporation or
association shall not be deemed to constitute a liquidation, dissolution or
winding up of the Association.
6. Preemptive Rights. The Non-Cumulative Preferred Stock is not entitled
to any preemptive, subscription, conversion or exchange rights in respect of any
securities of the Association.
7. Definitions. As used herein with respect to the Non-Cumulative
Preferred Stock, the following terms shall have the following meanings:
(a) The term "junior stock" shall mean the Common Stock and any other
class or series of shares of the Association hereafter authorized over which the
Non-Cumulative Preferred Stock has preference or priority in the
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<PAGE> 28
payment of dividends or in the distribution of assets on any liquidation,
dissolution or winding up of the Association.
(b) The term "accrued dividends", with respect to any share of any
class or series, shall mean an amount computed at the annual dividend rate for
the class or series of which the particular share is a part, from, if such
share is cumulative, the date on which dividends on such share became
cumulative to and including the date to which such dividends are to be accrued,
less the aggregate amount of all dividends theretofore paid thereon and, if
such share is non-cumulative, the relevant date designated to and including the
date to which such dividends are accrued, less the aggregate amount of all
dividends theretofore paid with respect to such period.
(c) The term "Preferred Stock" shall mean all outstanding shares of all
series of preferred stock of the Association as defined in this Article Fifth
of the Articles of Association, as amended, of the Association.
8. Restriction on Transfer. No shares of Non-Cumulative Preferred Stock,
or any interest therein, may be sold, pledged, transferred or otherwise
disposed of without the prior written consent of the Association. The foregoing
restriction shall be stated on any certificate for any shares of Non-Cumulative
Preferred Stock.
9. Additional Rights. The shares of Non-Cumulative Preferred Stock
shall not have any relative, participating, optional or other special rights
and powers other than as set forth herein.
SIXTH. The Board of Directors shall appoint one of its members
President and this Association, who shall be Chairperson of the Board, unless
the Board appoints another director to be the Chairperson. The Board of
Directors shall have the power to appoint one or more Vice Chairman and Vice
Presidents and such other officers and employees as may
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<PAGE> 29
be required to transact the business of this Association.
The Board of Directors shall have the power to define the duties of the
officers and employees of the Association; to fix the salaries to be paid to
them; to dismiss them; to require bonds from them and to fix the penalty
thereof; to regulate the manner in which any increase of the capital of the
Association shall be made; to manage and administer the business and affairs
of the Association; to make all By-laws that it may be lawful for them to
make; and generally to do and perform all acts that it may be legal for a Board
of Directors to do and perform.
SEVENTH. The Board of Directors shall have the power to change the
location of the main office to any other place permitted by law, but subject to
the approval of the Comptroller of the Currency; and shall have the power to
establish or change the location of any branch or branches of the Association
to any other location, without the approval of the shareholders, but subject to
the approval of the Comptroller of the Currency.
EIGHTH. The corporate existence of this Association shall continue until
terminated in accordance with the laws of the United States.
NINTH. The Board of Directors of this Association, or any one or more
shareholders owning, in the aggregate, not less than 25 percent of the stock of
this Association, may call a special meeting of shareholders at any time.
Unless otherwise provided by the laws of the United States, a notice of the
time, place, and purpose of every annual and special meeting of the
shareholders shall be given by first-class mail, postage prepaid, mailed at
least ten days prior to the date of such meeting, to each shareholder of record
at his address as shown upon the books of this Association.
TENTH. (A) Indemnification of Directors.
The Association shall, to the fullest extent permitted by applicable
banking, corporate and other law and regulation, indemnify any person who
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is or was a director of the Association from and against any and all expenses,
liabilities or other losses arising in connection with any action, suit, appeal
or other proceeding, by reason of the fact that such person is or was serving
as a director of the Association and may, to the fullest extent permitted by
applicable banking, corporate and other law and regulation, advance monies to
such persons for expenses incurred in defending any such action, suit, appeal
or other proceeding on such terms as the Association's Board of Directors shall
determine and as are required by applicable banking, corporate and other law or
regulation or interpretation by the applicable banking regulators. The
Association may purchase insurance for the purpose of indemnifying such persons
and/or reimbursing the Association upon payment of indemnification to such
persons to the extent that indemnification is authorized by the preceding
sentences, except that insurance coverage and corporate indemnification shall
not be available in connection with a formal order by a court or judicial or
governmental body assessing civil money penalties against such person or in the
event that such coverage or indemnification would be prohibited by applicable
banking, corporate and other law or regulation.
(B) Indemnification of Officers, Employees and Agents.
The Association shall indemnify any person who is or was an officer,
employee or agent of the Association or who is or was a director, general
partner, trustee or principal of another entity serving as such at the request
of the Association from and against any and all expenses, liabilities or other
losses arising in connection with any action, suit, appeal or other proceeding,
by reason of the fact that such person is or was serving as an officer,
employee or agent of the Association or as a director of another entity at the
request of the Association, to the extent authorized by the corporate policy of
the Association, as adopted and modified from time to time by the shareholders
of the Association, except to extent that such indemnification would be
prohibited by
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applicable banking, corporate and other law or regulation. The Association may
advance monies to such persons for expenses incurred in defending any such
action, suit, appeal or other proceeding in accordance with the corporate
policy of the Association, as adopted and modified from time to time by the
shareholders of the Association, under such terms and procedures as are
required by applicable banking, corporate and other law or regulation or
interpretation by the applicable banking regulators, except to the extent that
such advancement would be prohibited by applicable banking, corporate and other
law or regulation. The Association may purchase insurance for the purpose of
indemnifying such persons and/or reimbursing the Association upon payment of
indemnification to such person to the extent that indemnification is authorized
by the preceding sentence, except that insurance coverage and corporate
indemnification shall not be available in connection with a formal order by a
court or judicial or governmental body assessing civil money penalties against
such person or in the event that such coverage or indemnification would be
prohibited by applicable banking, corporate and other law or regulation.
ELEVENTH. These Articles of Association may be amended at any regular
or special meeting of the shareholders by the affirmative vote of the holders
of a majority of the stock of this Association, unless the vote of the holders
of a greater amount of stock is required by law, and in that case by the vote
of the holders of such greater amount.
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EXHIBIT 6
CONSENT OF TRUSTEE
Pursuant to the requirements of Section 321(b) of the Trust Indenture
Act of 1939, and in connection with the proposed issue of Air Products &
Chemicals, Inc. we hereby consent that reports of examinations by Federal,
State, Territorial or District authorities may be furnished by such authorities
to the Securities and Exchange Commission upon request therefore.
FIRST UNION NATIONAL BANK
By: s/John H. Clapham
---------------------
John H. Clapham
Vice President
Elkton, Maryland
April 11, 1996
<PAGE> 33
EXHIBIT 7
REPORT OF CONDITION
Consolidating domestic and foreign subsidiaries of the First Fidelity Bank,
National Association (now First Union National Bank) of Elkton in the state of
Maryland, at the close of business on December 31, 1995, published in response
to call made by Comptroller of the Currency, under title 12, United States
Code, Section 161. Charter Number 33869 Comptroller of the Currency
Northeastern District.
STATEMENT OF RESOURCES AND LIABILITIES
<TABLE>
<CAPTION>
Thousands of Dollars
--------------------
<S> <C>
ASSETS
Cash and balance due from depository institutions:
Noninterest-bearing balances and currency and coin............. 1,876,439
Interest-bearing balances...................................... 35,650
Securities....................................................... //////////
Hold-to-maturity securities.................................... 672,202
Available-for-sale securities.................................. 4,786,380
Federal funds sold and securities purchased under agreements..... //////////
to resell in domestic offices of the bank and of it //////////
Edge and Agreement subsidiaries, and in IBFs: //////////
Federal funds sold............................................. 30,000
Securities purchased under agreements to resell................ 369,072
Loans and lease financing receivables:
Loan and leases, net of unearned income..............23,027,860
LESS: Allowance for loan and lease losses...............469,305
LESS: Allocated transfer risk reserve.........................0
Loans and leases, net of unearned income, allowance, and
reserve.......................................................... 22,558,555
Assets held in trading accounts.................................. 76,675
Premises and fixed assets (including capitalized leases)......... 374,903
Other real estate owned.......................................... 104,196
Investment in unconsolidated subsidiaries and associated //////////
companies........................................................ 19,166
Customer's liability to this bank on acceptances outstanding..... 134,499
Intangible assets................................................ 785,891
Other assets..................................................... 863,227
Total assets..................................................... 32,686,855
LIABILITIES
Deposits:
In domestic offices............................................ 24,886,995
Noninterest-bearing...............................4,687,403
Interest-bearing.................................20,199,592
In foreign offices, Edge and Agreement subsidiaries,
and IBFs....................................................... 1,304,436
Noninterest-bearing.....................................207
Interest-bearing....................................960,051
Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of its
Edge and Agreement subsidiaries, and IBFs
Federal fund purchased......................................... 1,304,436
Securities sold under agreements to repurchase................. 882,846
Demand notes issued to the U.S. Treasury......................... 97,451
Trading liabilities.............................................. 0
Other borrowed money............................................. //////////
With original maturity of one year or less....................... 252,296
With original maturity of more than one year................... 1,602
Mortgage indebtedness and obligations under capitalized leases... 17,369
Bank's liability on acceptances executed and outstanding......... 134,499
Subordinated notes and debentures................................ 175,000
Other liabilities................................................ 934,256
Total liabilities................................................ 29,647,008
Limited-life preferred stock and related surplus................. 0
EQUITY CAPITAL
Perpetual preferred stock and related surplus.................... 160,540
Common Stock..................................................... 452,156
Surplus.......................................................... 1,300,080
Undivided profits and capital reserves........................... 1,127,557
Net unrealized holding gains (losses) on available-for-sale //////////
securities....................................................... (486)
Cumulative foreign currency translation adjustments.............. 0
Total equity capital............................................. 3,039,847
Total liabilities, limited-life preferred stock and equity //////////
capital.......................................................... 32,686,855
</TABLE>
