<PAGE>
ORIGINAL ELECTRONICALLY TRANSMITTED TO THE SECURITIES AND EXCHANGE COMMISSION ON
APRIL 30, 1997
REGISTRATION NO. 333- (1)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-------------------
IBM CREDIT CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
------------------------
<TABLE>
<CAPTION>
DELAWARE 22-2351962
<S> <C>
(STATE OR OTHER JURISDICTION OF INCORPORATION (I.R.S. EMPLOYER IDENTIFICATION NO.)
OR ORGANIZATION)
</TABLE>
1133 WESTCHESTER AVENUE
WHITE PLAINS, NEW YORK 10604
(914) 642-3000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
------------------------
JOHN J. SHAY, JR.
VICE PRESIDENT, SECRETARY AND GENERAL COUNSEL
IBM CREDIT CORPORATION
1133 WESTCHESTER AVENUE
WHITE PLAINS, NEW YORK 10604
(914) 642-3000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
------------------------
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 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
<TABLE>
<CAPTION>
TITLE OF EACH CLASS AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM
OF SECURITIES TO BE OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
TO BE REGISTERED REGISTERED(a) PER UNIT(b) PRICE(a)(b) REGISTRATION FEE
<S> <C> <C> <C> <C>
Debt Securities............. $3,500,000,000 100% $3,500,000,000 $1,060,607
</TABLE>
(a) The initial public offering price of any Debt Securities denominated in any
foreign currencies or currency units shall be the U.S. dollar equivalent
thereof based on the prevailing exchange rates at the respective times such
Debt Securities are first offered. For Debt Securities issued with an
original issue discount, the amount to be registered is calculated as the
initial accreted value of such Debt Securities.
(b) Estimated solely for purposes of calculating the registration fee.
------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
--------------------------
(1) Pursuant to Rule 429 of the Rules and Regulations of the Securities and
Exchange Commission under the Securities Act of 1933, the Prospectus included in
this Registration Statement also relates to up to $484,000,000 of Debt
Securities previously registered under the Registrant's Registration Statement
on Form S-3 (Registration No. 33-06335), less the amount of any such Debt
Securities offered on or after the date hereof and prior to the date this
Registration Statement shall be declared effective. The amount of the filing fee
associated with such securities that was previously paid with the prior
Registration Statement is $166,897.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
SUBJECT TO COMPLETION APRIL 30, 1997
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.
<PAGE>
PROSPECTUS
IBM CREDIT CORPORATION
DEBT SECURITIES
IBM Credit Corporation (the "Company") intends from time to time to issue in
one or more series up to $3,984,000,000 aggregate amount of its debt securities
(the "Securities") or, for Securities denominated in currencies or currency
units other than U.S. dollars, the equivalent thereof based on the prevailing
exchange rates at the respective times such Securities are first offered, each
series of which will be offered on terms to be determined at the time of sale.
When a particular series of Securities is offered, a supplement to this
Prospectus (a "Prospectus Supplement") will be delivered with this Prospectus
setting forth with respect to such series: the designation and principal amount
offered; the purchase price and other terms of the offering; the maturity or
maturities; the rate (or method of calculation) and time of payment of interest,
if any; the authorized denominations; the terms for a sinking, purchase or
analogous fund, if any; the terms for redemption or early repayment, if any; the
currency or currencies or currency unit or units in which principal, premium, if
any, or interest, if any, is payable; and any listing on a securities exchange.
------------------
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.
------------------
The Securities may be sold (i) through underwriting syndicates represented
by managing underwriters or by underwriters without a syndicate; (ii) through
agents designated from time to time; or (iii) directly to purchasers. The names
of any underwriters or agents of the Company involved in the sale of the
Securities in respect of which this Prospectus is being delivered and any
applicable commissions or discounts are set forth in the Prospectus Supplement.
The net proceeds to the Company from such sale are also set forth in the
Prospectus Supplement. Securities in bearer form are offered only outside the
United States and its possessions to non-United States persons or to offices
located outside the United States and its possessions of certain United States
financial institutions or to certain international organizations and foreign
central banks.
------------------
THE DATE OF THIS PROSPECTUS IS , 1997
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "Exchange Act") and, in accordance therewith, files
reports and other information with the Securities and Exchange Commission (the
"Commission"). Reports and other information can be inspected and copied at the
public reference facilities maintained by the Commission at 450 Fifth Street,
N.W., Room 1024, Washington, D.C. 20549, and the Commission's Regional Offices
located at 7 World Trade Center, 13th Floor, New York, New York 10048 and
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
Copies of such material may be obtained from the Public Reference Section of the
Commission, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates.
In addition, the Commission maintains a Website that contains reports, proxy and
information statements and other information regarding registrants that file
electronically with the Commission ("http:/www.sec.gov"). Such reports and other
information concerning the Company may also be inspected at the offices of the
New York Stock Exchange, Inc., 20 Broad Street, 7th Floor, New York, New York
10005.
DOCUMENTS INCORPORATED BY REFERENCE
The following document filed by the Company with the Commission pursuant to
Section 13 of the Exchange Act is incorporated by reference into this
Prospectus: the Company's Annual Report on Form 10-K for the year ended December
31, 1996. All documents subsequently filed by the Company pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date hereof and prior to
the termination of the offering of the Securities offered hereby shall be deemed
to be incorporated herein by reference.
The Company will provide without charge to each person to whom this
Prospectus has been delivered, on the written or oral request of such person, a
copy of any documents incorporated herein by reference, other than exhibits to
such documents. Requests for copies of such documents should be directed to
Treasurer, IBM Credit Corporation, 1133 Westchester Avenue, White Plains, NY
10604 (telephone: (914) 642-3000).
2
<PAGE>
THE COMPANY
The principal business of the Company is the financing of IBM products and
services. All the outstanding capital stock of the Company is owned by
International Business Machines Corporation ("IBM"), a New York corporation. The
Company finances the purchase and lease of IBM products and related products and
services by customers of IBM in the U.S. and finances inventory and accounts
receivable for dealers and remarketers of IBM and non-IBM products and services.
Pursuant to a Support Agreement between IBM and the Company, IBM has agreed
to retain 100 percent of the voting capital stock of the Company, unless
required to dispose of any or all such shares of stock pursuant to a court
decree or order of any governmental authority that, in the opinion of counsel to
IBM, may not be successfully challenged. IBM has also agreed to cause the
Company to have a tangible net worth of at least $1.00 at all times. The Support
Agreement provides that it shall not be deemed to constitute a direct or
indirect guarantee of IBM to any party of the payment of the principal of, or
interest on, any indebtedness, liability or obligation of the Company. The
Support Agreement may not be modified, amended or terminated while there is
outstanding any debt of the Company, unless all holders of such debt have
consented in writing. Accordingly, the Support Agreement will remain in effect
as long as any debt of the Company is outstanding, unless all holders of such
debt agree otherwise.
The Company was incorporated in Delaware on March 4, 1981. The Company's
principal executive offices are located at 1133 Westchester Avenue, White
Plains, New York 10604 and its telephone number is (914) 642-3000.
USE OF PROCEEDS
Unless otherwise indicated in the applicable Prospectus Supplement, the
Company intends to use the net proceeds from the sale of the Securities for
general corporate purposes.
The Company expects that it will, on a recurring basis, engage in additional
financings in character and amount to be determined as the need arises.
RATIO OF EARNINGS TO FIXED CHARGES
The following ratios of earnings to fixed charges have been computed by
dividing the sum of net earnings before income taxes and fixed charges, by fixed
charges. Fixed charges consist of gross interest on debt and such portion of
rental expense deemed to be representative of the interest factor.
<TABLE>
<CAPTION>
THREE MONTHS
ENDED YEAR ENDED
MARCH 31, DECEMBER 31,
----------------- ------------------------------------------
<S> <C> <C> <C> <C> <C>
1997 1996 1995 1994 1993
----------------- --------- --------- --------- ---------
Ratio of earnings to fixed charges............................ 2.16 2.02 1.96 2.34 2.07
<CAPTION>
<S> <C>
1992
---------
Ratio of earnings to fixed charges............................ 1.78
</TABLE>
3
<PAGE>
DESCRIPTION OF THE SECURITIES
The Securities are to be issued under an Indenture dated as of January 15,
1989, as amended or supplemented (the "Indenture"), between the Company and The
Chase Manhattan 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; whenever
particular provisions of the Indenture are referred to, such provisions are
incorporated by reference as part of the statement made, and the statement is
qualified in its entirety by such reference. Whenever a defined term is referred
to and not herein defined, the definition thereof is contained in the Indenture.
GENERAL
The Indenture provides for the issuance from time to time of Securities in
an unlimited aggregate principal amount and an unlimited number of series.
The Securities are unsecured and will rank PARI PASSU (I.E., without any
precedence over each other) with all other unsecured and nonsubordinated debt of
the Company.
Reference is made to the applicable Prospectus Supplement for the following
terms of the series of Securities offered thereby: (i) the title of the
Securities of such series; (ii) any limit upon the aggregate principal amount of
such Securities; (iii) the date or dates on which such Securities will mature or
the method of determination of such date or dates; (iv) the rate or rates, or
the method of determination thereof, at which such Securities will bear
interest, if any, the date or dates from which such interest will accrue and the
date or dates such interest will be payable; (v) the place or places where the
principal of, and premium and interest, if any, on, such Securities will be
payable; (vi) the periods, prices and terms and conditions upon which any such
Security may be redeemed, in whole or in part, at the option of the Company;
(vii) any terms for redemption or repurchase pursuant to any sinking fund or
analogous provision or at the option of a Holder; (viii) if other than the
principal amount thereof, the portion of the principal amount of such Securities
that will be payable upon acceleration of maturity (Securities subject to such
provisions being referred to as "Original Issue Discount Securities"); (ix) any
deletions or modifications of, or additions to, the Events of Default or
covenants of the Company under the Indenture with respect to such Securities
(including whether the covenants described below under "Covenants--LIMITATIONS
ON LIENS" will not apply to such Securities); (x) if other than U.S. dollars,
the currency, currencies or currency unit or units in which such Securities will
be denominated and in which the principal of, and premium and interest, if any,
on, such Securities will be payable; (xi) whether, and the terms and conditions
on which, the Company or a Holder may elect payment of principal of, or premium
or interest, if any, on, such Securities in a currency, currencies or currency
unit or units other than that in which such Securities are stated to be payable;
(xii) the manner of determining the amount of principal of, or premium or
interest, if any, on, any such Securities to be determined with reference to an
index based on a currency or currency unit other than that in which such
Securities are stated to be payable; (xiii) whether such Securities will be
issued in fully registered form without coupons ("Registered Securities") or in
bearer form with or without coupons ("Bearer Securities"), or any combination
thereof, whether such Securities will be issued in the form of one or more
global securities (each a "Global Security") and whether such Securities are to
be issuable in temporary global form or definitive global form; (xiv) if such
Securities are to be issued upon the exercise of warrants, the time, manner and
place for such Securities to be authenticated and delivered; (xv) whether and
under what circumstances the Company will pay additional amounts to any Holder
of such Securities who is not a U.S. Person (as defined herein under "Global
Securities--Temporary Global Securities") in respect of any tax, assessment or
governmental charge withheld or deducted and, if so, whether and on what terms
the Company will have the option to redeem such Securities rather than pay any
additional amounts; and (xvi) any other terms of any of such Securities not
inconsistent with the Indenture. (Sections 202 and 301)
Unless otherwise specified in the applicable Prospectus Supplement, (x) the
Securities will be Registered Securities and (y) Securities denominated in U.S.
dollars will be issued, in the case of
4
<PAGE>
Registered Securities, in denominations of $1,000 or an integral multiple
thereof and, in the case of Bearer Securities, in denominations of $5,000.
If any of the Securities are sold for any foreign currency or currency unit
or if the principal of, or premium or interest, if any, on, any of the
Securities is payable in any foreign currency or currency unit, the specific
terms of such Securities and any other information concerning the restrictions,
elections and tax consequences with respect to such Securities and such foreign
currency or currency unit will be set forth in the Prospectus Supplement
relating thereto.
EXCHANGE, REGISTRATION AND TRANSFER
Registered Securities of any series will be exchangeable for other
Registered Securities of the same series and of a like aggregate principal
amount and tenor of different authorized denominations. If Securities of any
series are issuable as both Registered Securities and Bearer Securities, the
Bearer Securities of such series (with all unmatured coupons, except as provided
below, and all matured coupons in default) will be exchangeable for Registered
Securities of the same series of any authorized denominations and of a like
aggregate principal amount and tenor. If a Bearer Security with coupons
appertaining thereto is surrendered in exchange for a Registered Security
between a Regular Record Date or Special Record Date and the relevant date for
payment of interest, such Bearer Security shall be surrendered without the
coupon relating to such date for payment of interest. Interest will not be
payable in respect of the Registered Security issued in exchange for such Bearer
Security, but will be payable only to the Holder of such coupon when due in
accordance with the terms thereof and of the Indenture. Bearer Securities will
not be issued in exchange for Registered Securities (unless otherwise specified
in the applicable Prospectus Supplement and permitted by applicable rules and
regulations). 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 in connection therewith. (Section 404)
Securities may be presented for exchange as provided above, and Registered
Securities (other than U.S. Book-Entry Securities (as defined under "Global
Securities--Definitive Global Securities--U.S. BOOK-ENTRY SECURITIES" below))
may be presented for registration of transfer (with the form of transfer
endorsed thereon duly executed), at the office of the Security Registrar or at
the office of any additional transfer agent designated by the Company for such
purpose with respect to any series of Securities and referred to in the
applicable Prospectus Supplement. (Sections 404 and 1102) The Company has named
the Trustee the Security Registrar under the Indenture. (Section 101) The
Company may at any time designate, or rescind the designation of, the Security
Registrar or any additional transfer agent or approve a change in the location
through which the Security Registrar or any such transfer agent acts, except
that, if Securities of a series are issuable solely as Registered Securities,
the Company will be required to maintain a transfer agent in each Place of
Payment for such series and, if Securities of a series are issuable as Bearer
Securities, the Company will be required to maintain (in addition to the
Security Registrar) a transfer agent in a Place of Payment for such series
located in Europe. The Company may at any time designate additional transfer
agents with respect to any series of Securities. (Section 1102)
In the event of any redemption in part, the Company will not be required to:
(i) issue, register the transfer of or exchange Securities of any series during
a period beginning at the opening of business 15 Business Days before any
selection of Securities of that series to be redeemed and ending at the close of
business on (a) if Securities of the series are issuable only as Registered
Securities, the day of mailing of the relevant notice of redemption and (b) if
Securities of the series are issuable only as Bearer Securities, the day of the
first publication of the relevant notice of redemption or, if Securities of the
series are also issuable as Registered Securities and there is no publication,
the day of mailing of the relevant notice of redemption; (ii) register the
transfer of or exchange any Registered Security, or portion thereof, called for
redemption, except the unredeemed portion of any Registered Security being
redeemed in part; or (iii) exchange any Bearer Security called for redemption,
except to exchange such Bearer Security for a Registered Security of that series
and like tenor which is immediately surrendered for redemption. (Section 404)
5
<PAGE>
For a discussion of restrictions on the exchange, registration and transfer
of Global Securities, see "Global Securities" below.
PAYMENT AND PAYING AGENTS
Payment of principal of, and premium and interest, if any, on, Registered
Securities will be made in the designated currency or currency unit at the
office of such Paying Agent or Paying Agents as the Company may designate from
time to time. At the option of the Company payment of any interest on Registered
Securities may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register. Payment of any
installment of interest on Registered Securities will be made to the Person in
whose name such Registered Security is registered at the close of business on
the Regular Record Date for such interest. (Section 406)
Payment of principal of, and premium and interest, if any, on, Bearer
Securities will be made in the designated currency or currency unit at the
offices of such Paying Agents outside the United States as the Company may
designate from time to time. On the applicable payment date therefor, payments
of principal of, and premium, if any, on, Bearer Securities will be made against
surrender of such Securities, and payment of interest on Bearer Securities with
coupons appertaining thereto on any Interest Payment Date will be made only
against surrender of the coupon relating to such Interest Payment Date.
(Sections 410 and 1102) No payment with respect to any Bearer Security will be
made at any office or agency of the Company in the United States or by check
mailed to any address in the United States or by transfer to an account
maintained with a bank located in the United States. Notwithstanding the
foregoing, payments of principal of, and premium and interest, if any, on,
Bearer Securities denominated and payable in U.S. dollars will be made at the
office of the Company's Paying Agent in The City of New York, if (but only if)
payment of the full amount thereof in U.S. dollars at all offices or agencies
outside the United States is illegal or effectively precluded by exchange
controls or other similar restrictions. (Section 1102)
Unless otherwise indicated in the applicable Prospectus Supplement, the
Corporate Trust Office of the Trustee in The City of New York will be designated
as the Company's Paying Agent for payments with respect to Securities that are
issuable solely as Registered Securities and as the Company's Paying Agent in
The City of New York for payments with respect to Securities (subject to the
limitations described above in the case of Bearer Securities) that are issuable
solely as Bearer Securities or as both Registered Securities and Bearer
Securities. Any Paying Agents outside the United States and any other Paying
Agents in the United States initially designated by the Company for Securities
of a series will be named in the applicable Prospectus Supplement. The Company
may at any time designate additional Paying Agents or rescind the designation of
any Paying Agent or approve a change in the office through which any Paying
Agent acts, except that, if Securities of a series are issuable solely as
Registered Securities, the Company will be required to maintain a Paying Agent
in each Place of Payment for such series and, if Securities of a series are
issuable as Bearer Securities, the Company will be required to maintain (i) a
Paying Agent in The City of New York for payments with respect to any Registered
Securities of the series (and for payments with respect to Bearer Securities of
the series in the circumstances described above, but not otherwise), and (ii) a
Paying Agent in a Place of Payment located outside the United States where
Securities of such series and any coupons appertaining thereto may be presented
and surrendered for payment; provided that if the Securities of such series are
listed on The London Stock Exchange Limited, the Luxembourg Stock Exchange or
any other stock exchange located outside the United States and such stock
exchange shall so require, the Company will maintain a Paying Agent in London,
Luxembourg or any other required city located outside the United States, as the
case may be, for the Securities of such series. (Section 1102)
Unless otherwise indicated in the applicable Prospectus Supplement, in any
case where any Interest Payment Date, Redemption Date or Stated Maturity of any
Security or Coupon shall not be a Business Day at any Place of Payment, then
(notwithstanding any other provision of the Indenture or of such Security or
Coupon) payment of interest or principal (and premium, if any) need not be made
at such Place of Payment on such date, but may be made on the next succeeding
Business Day at such Place of Payment with the same force and effect as if made
on the Interest Payment Date or Redemption Date, or
6
<PAGE>
at the Stated Maturity, as the case may be, PROVIDED that no interest shall
accrue for the period from and after such Interest Payment Date, Redemption Date
or Stated Maturity, as the case may be, to the next succeeding Business Day at
such Place of Payment. (Section 113)
All moneys paid by the Company to a Paying Agent for the payment of
principal of, and premium and interest, if any, on, any Security or coupon that
remains unclaimed at the end of two years after such principal, premium or
interest shall have become due and payable will be repaid to the Company and the
Holder of such Security or coupon will thereafter look only to the Company for
payment thereof. (Section 1103)
GLOBAL SECURITIES
The Securities of a series may be issued in whole or in part as one or more
Global Securities in either registered or bearer form and in either temporary or
definitive form. The Global Security or Securities of a series will be deposited
with, or on behalf of, a depositary located in the United States (a "U.S.
Depositary") or a common depositary outside the United States ( a "Common
Depositary") identified in the Prospectus Supplement relating to such series.
All temporary or definitive Global Securities in bearer form will be deposited
with a Common Depositary.
The specific terms of the depositary arrangement with respect to any
Securities of a series issued in global form will be described in the Prospectus
Supplement relating to such series. The Company may treat a Person having a
beneficial interest in a definitive Global Security as the Holder of such
principal amount of Outstanding Securities represented by such definitive Global
Security as shall be specified in a written statement of the Holder of such
definitive Global Security, or, in the case of a definitive Global Security in
bearer form, of Euroclear or CEDEL, which is delivered to the Trustee by such
Person. (Section 411) None of the Company, the Trustee, any Paying Agent or the
Security Registrar 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. (Section 411) The
Company anticipates that the following provisions will apply to all depositary
arrangements with a U.S. Depositary or Common Depositary.
TEMPORARY GLOBAL SECURITIES
If so specified in the applicable Prospectus Supplement, all or any portion
of the Securities of a series that are issuable as Bearer Securities initially
will be represented by one or more temporary Global Securities, without interest
coupons, to be deposited with a Common Depositary in London for Morgan Guaranty
Trust Company of New York, Brussels Office, as operator of the Euroclear System
("Euroclear") and CEDEL S.A. ("CEDEL") for credit to the respective accounts of
the beneficial owners of such Securities (or to such other accounts as they may
direct). On and after the exchange date determined as provided in any such
temporary Global Security and described in the applicable Prospectus Supplement,
each such temporary Global Security will be exchangeable for definitive
Securities in bearer form, registered form, definitive global bearer form or any
combination thereof, as specified in the applicable Prospectus Supplement. No
Bearer Security (including a Security in definitive global bearer form)
delivered in exchange for a portion of a temporary Global Security will be
mailed or otherwise delivered to any location in the United States in connection
with such exchange. (Sections 402 and 403)
7
<PAGE>
See the applicable Prospectus Supplement for a description of the
requirements for certification of ownership by non-United States persons that
will apply prior to (i) the issuance of a definitive Bearer Security or (ii) the
payment of interest on an Interest Payment Date that occurs before the issuance
of a definitive Bearer Security.
As used herein, "United States person" means a citizen or resident of the
United States, a corporation, partnership or other entity created or organized
in or under the laws of the United States or any political subdivision thereof
or an estate or trust the income of which is subject to United States Federal
income taxation regardless of its source, and "United States" means the United
States of America (including the States and the District of Columbia), its
territories, its possessions and other areas subject to its jurisdiction.
DEFINITIVE GLOBAL SECURITIES
BEARER SECURITIES. If any Securities of a series are issuable in definitive
global bearer form, the applicable Prospectus Supplement will describe the
circumstances, if any, under which beneficial owners of interest in any such
definitive global Bearer Security may exchange such interests for Securities of
such series and of like tenor and principal amount in any authorized form and
denomination. No Bearer Security delivered in exchange for a portion of a
definitive global Bearer Security will be mailed or otherwise delivered to any
location in the United States in connection with such exchange. (Section 404)
Principal of, and premium and interest, if any, on, a definitive global Bearer
Security will be payable in the manner described in the applicable Prospectus
Supplement.
U.S. BOOK-ENTRY SECURITIES. If Securities of a series are to be represented
by a definitive global Registered Security to be deposited with or on behalf of
a U.S. Depositary, such Securities ("U.S. Book-Entry Securities") will be
represented by a definitive Global Security registered in the name of the U.S.
Depositary or its nominee. Upon the issuance of a definitive Global Security
registered in the name of the U.S. Depositary, the U.S. Depositary will credit,
on its book-entry registration and transfer system, the respective principal
amounts of the U.S. Book-Entry Securities represented by such Global Security to
the accounts of institutions that have accounts with such depositary or its
nominee ("participants"). The accounts to be credited shall be designated by the
underwriters or agents for the sale of such U.S. Book-Entry Securities or by the
Company, if such Securities are offered and sold directly by the Company.
Ownership of U.S. Book-Entry Securities will be limited to participants or
persons that may hold interests through participants. Ownership of U.S.
Book-Entry Securities will be shown on, and the transfer of that ownership will
be effected only through, records maintained by the U.S. Depositary or its
nominee for the applicable definitive Global Security or by participants or
persons that hold through participants. So long as the U.S. Depositary, or its
nominee, is the registered owner of such Global Security, such depositary or
such nominee, as the case may be, will be considered the sole owner or holder of
the U.S. Book-Entry Securities represented by such Global Security for all
purposes under the Indenture. Payment of principal of, and premium and interest,
if any, on, U.S. Book-Entry Securities will be made to the U.S. Depositary or
its nominee, as the case may be, as the registered owner or the holder of the
Global Security representing such U.S. Book-Entry Securities. Owners of U.S.
Book-Entry Securities will not be entitled to have such Securities registered in
their names in the Security Register, will not receive or be entitled to receive
physical delivery of such Securities in definitive form and will not be
considered the owners or holders thereof under the Indenture. The laws of some
jurisdictions 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 purchase or transfer U.S. Book-Entry Securities.
The Company expects that the U.S. Depositary for U.S. Book-Entry Securities
of a series, upon receipt of any payment of principal of, or premium or
interest, if any, on, the related definitive Global Security, will immediately
credit participants' accounts with payments in amounts proportionate to their
respective beneficial interests in the principal amount of such Global Security
as shown on the records of such Depositary. The Company also expects that
payments by participants to owners of beneficial interests
8
<PAGE>
in such Global Security held through such participants will be governed by
standing 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", and will be the responsibility of such participants.
COVENANTS
LIMITATIONS ON LIENS. The Company will not, nor will it permit any
Restricted Subsidiary to, incur, issue, assume, guarantee or suffer to exist any
indebtedness for money borrowed or any bonds, debentures, notes or other similar
evidences of indebtedness, whether or not for money borrowed, ("Debt") which are
secured by any pledge of, or mortgage, security interest or other lien ("lien")
on, any property or assets, whether now owned or hereafter acquired, of the
Company or any Restricted Subsidiary, or any shares of stock or Debt of any
Restricted Subsidiary, without effectively providing that the Securities
(together with, if the Company so determines, any other Debt of the Company or
such Restricted Subsidiary then existing or thereafter created which is not
subordinated to the Securities) shall be secured equally and ratably with (or
prior to) such Debt, so long as such Debt shall be so secured, unless, after
giving effect thereto, the aggregate amount of all such secured Debt of the
Company and its Restricted Subsidiaries would not exceed 10% of Consolidated Net
Tangible Assets of the Company and its Restricted Subsidiaries; PROVIDED,
HOWEVER, that this restriction will not apply to: (1) liens on property of, or
on any shares of stock or debt of, any corporation existing at the time such
corporation becomes a Restricted Subsidiary; (2) liens on property, shares of
stock or debt existing at the time of acquisition thereof by the Company or any
Restricted Subsidiary; (3) liens on physical property, shares of stock or debt
subsequently acquired (or, in the case of property, constructed) by the Company
or any Restricted Subsidiary and created prior to, at the time of, or within one
year after such acquisition (or, in the case of property, the completion of such
construction or commencement of commercial operation of such property, whichever
is later) to secure or provide for the payment of all or any part of the
purchase price (or, in the case of property, the construction price) thereof;
(4) liens in favor of the Company or any Restricted Subsidiary; (5) liens in
favor of the United States of America or any State thereof or the District of
Columbia, or any agency, department or other instrumentality thereof, to secure
progress, advance or other payments pursuant to any contract or provision of any
statute; (6) liens securing the performance of any contract or undertaking not
directly or indirectly in connection with the borrowing of money, obtaining of
advances or credit or the securing of debt, if made and continuing in the
ordinary course of business; (7) liens to secure nonrecourse obligations in
connection with the Company's or a Restricted Subsidiary's engaging in leveraged
or single-investor lease transactions; and (8) any extension, renewal or
replacement of the foregoing. (Section 1104)
"Consolidated Net Tangible Assets" means, at any date, the total assets
appearing on the most recently prepared consolidated balance sheet of the
Company and its Restricted Subsidiaries as at the end of the fiscal quarter of
the Company, prepared in accordance with generally accepted accounting
principles, less (a) all current liabilities (due within one year) as shown on
such balance sheet, (b) investments in and advances to subsidiaries of the
Company other than Restricted Subsidiaries or other entities accounted for on
the equity method of accounting, and (c) intangible assets. "Intangible assets"
means the value (net of any applicable reserves), as shown on or reflected in
such balance sheet, of: (i) all trade names, trademarks, licenses, patents,
copyrights and goodwill; (ii) organizational and development costs; (iii)
deferred charges (other than prepaid items such as insurance, taxes, interest,
commissions, rents and similar items and tangible assets being amortized); and
(iv) unamortized debt discount and expense, less unamortized premium. (Section
101)
"Restricted Subsidiary" means each subsidiary of the Company organized under
the laws of any State of the United States or the District of Columbia. (Section
101)
CONSOLIDATION, MERGER OR SALE OF ASSETS OF THE COMPANY. The Company shall
not consolidate with or merge into any other corporation or sell its assets
substantially as an entirety, unless (1) the corporation formed by such
consolidation or into which the Company is merged or the corporation which
acquires its assets is a corporation all of the voting capital stock of which is
owned by IBM or any successor thereto, is
9
<PAGE>
organized in the United States, and expressly assumes the due and punctual
payment of the principal of, and premium and interest, if any, on, all the
Securities and the performance of every covenant of the Indenture on the part of
the Company and (2) immediately after giving effect to such transaction, no
Event of Default, and no event which, after notice or lapse of time, or both,
would become an Event of Default, shall have happened and be continuing. Upon
any such consolidation, merger or sale, the successor corporation formed by such
consolidation or into which the Company is merged or to which such sale is made
shall succeed to, and be substituted for, the Company under the Indenture.
(Sections 901 and 902)
EVENT RISK. Except as set forth (x) under "The Company" with respect to the
Support Agreement between IBM and the Company, pursuant to which, subject to
certain exceptions, IBM agrees to maintain ownership of 100% of the voting
capital stock of the Company and to cause the Company to have a tangible net
worth of $1.00 as long as the Securities are outstanding, and (y) above under
the heading "Covenants", the Indenture and 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, reorganization,
restructuring, merger or similar transaction involving the Company.
EVENTS OF DEFAULT, NOTICE AND WAIVER
The Indenture provides that, if an Event of Default specified therein with
respect to any series of Securities shall have happened and be continuing,
either the Trustee or the Holders of 25% in principal amount of the Outstanding
Securities of such series may declare the principal of all the Securities of
such series, together with accrued interest thereon, to be due and payable.
(Section 602)
Events of Default in respect of any series are defined in the Indenture as
being: default for 30 days in payment of any interest installment when due, and
default in payment of principal of, or premium, if any, on, Securities of such
series when due either at their stated maturity, by declaration, when called for
redemption or otherwise; default in the making of any sinking fund payment when
due; default for 90 days after notice to the Company by the Trustee or by
Holders of 25% in principal amount of the Outstanding Securities of such series
in the performance of any covenant in the Indenture with respect to Securities
of such series; and certain events of bankruptcy, insolvency and reorganization.
No Event of Default with respect to a single series of indebtedness issued under
the Indenture (and any supplemental indentures) constitutes an Event of Default
with respect to any other series of indebtedness issued thereunder. (Section
601)
The Indenture provides that the Trustee will, within 90 days after the
occurrence of a default with respect to the Securities of any series, give to
the Holders of the Securities of such series notice of all uncured and unwaived
defaults known to it; PROVIDED that, except in the case of default in the
payment of principal of, or premium or interest, if any, on, any of the
Securities of such series, the Trustee will be protected in withholding such
notice if it in good faith determines that the withholding of such notice is in
the interest of the Holders of the Securities of such series. The term "default"
for the purpose of this provision only means the happening of any of the Events
of Default specified above, except that any grace period or notice requirement
is eliminated. (Section 702)
The Indenture contains provisions entitling the Trustee, subject to the duty
of the Trustee during an Event of Default to act with the required standard of
care, to be indemnified by the Holders of the Securities before proceeding to
exercise any right or power under the Indenture at the request of Holders of the
Securities. (Section 703)
The Indenture provides that the Holders of a majority in principal amount of
the Outstanding Securities of any series may direct the time, method and place
of conducting proceedings for remedies available to the Trustee, or exercising
any trust or power conferred on the Trustee in respect of such series. (Section
612)
10
<PAGE>
The Indenture includes a covenant that the Company will file annually with
the Trustee a certificate of no default, or specifying any default that exists.
(Section 1105)
In certain cases, the Holders of a majority in principal amount of the
Outstanding Securities of any series may on behalf of the Holders of all
Securities of such series waive any past default or Event of Default with
respect to the Securities of such series or compliance with certain provisions
of the Indenture, except, among other things, a default not theretofore cured in
payment of the principal of, or premium or interest, if any, on, any of the
Securities of such series. (Section 613)
MODIFICATION OF THE INDENTURE
The Indenture provides that the Company and the Trustee thereunder may,
without the consent of any Holders of Securities, enter into supplemental
indentures for the purposes, among other things, of adding to the Company's
covenants, adding additional Events of Default, establishing the form or terms
of Securities or curing ambiguities or inconsistencies in the Indenture or
making other provisions, provided such action shall not adversely affect the
interests of the Holders of any series of Securities in any material respect.
(Section 1001)
The Indenture contains provisions permitting the Company, with the consent
of the Holders of not less than a majority in principal amount of the
Outstanding Securities of all affected series (acting as one class), to execute
supplemental indentures adding any provisions to or changing or eliminating any
of the provisions of the Indenture or modifying the rights of the Holders of the
Securities of such series, except that no such supplemental indenture may,
without the consent of the Holders of all the Outstanding Securities affected
thereby, among other things: (i) change the Stated Maturity of the principal of,
or any installment of principal of or interest on, any Security; (ii) reduce the
principal amount of, the rate of interest on, or any premium payable upon the
redemption of, any Security; (iii) reduce the amount of the principal of an
Original Issue Discount Security that would be due and payable upon acceleration
of the Maturity thereof; (iv) change any Place of Payment where, or the
currency, currencies or currency unit or units in which, any Security or any
premium or interest thereon is payable; (v) impair the right to institute suit
for the enforcement of any such payment on or after the Stated Maturity thereof
(or, in the case of redemption, on or after the Redemption Date); (vi) affect
adversely the terms, if any, of conversion of any Security into stock or other
securities of the Company or of any other corporation; (vii) reduce the
percentage in principal amount of the Outstanding Securities of any series, the
consent of whose Holders is required for any such supplemental indenture, or the
consent of whose Holders is required for any waiver (of compliance with certain
provisions of the Indenture or certain defaults thereunder and their
consequences) provided for in the Indenture; (viii) change any obligation of the
Company, with respect to Outstanding Securities of a series, to maintain an
office or agency in the places and for the purposes specified in the Indenture
for such series; (ix) modify any of the foregoing provisions or the provisions
for the waiver of certain covenants and defaults, except to increase any
applicable percentage of the aggregate principal amount of Outstanding
Securities the consent of the Holders of which is required or to provide with
respect to any particular series the right to condition the effectiveness of any
supplemental indenture as to that series on the consent of the Holders of a
specified percentage of the aggregate principal amount of Outstanding Securities
of such series or to provide that certain other provisions of the Indenture
cannot be modified or waived without the consent of the Holder of each
Outstanding Security affected thereby. (Section 1002)
WAIVER OF CERTAIN COVENANTS
The Indenture provides that the Company may omit to comply with the
restrictive covenants described above under "Covenants--LIMITATIONS ON LIENS" if
the Holders of not less than a majority in principal amount of all series of
Outstanding Securities affected thereby (acting as one class) waive compliance
with such restrictive covenants. (Section 1106)
11
<PAGE>
MEETINGS
The Indenture contains provisions for convening meetings of the Holders of
Securities of any series. (Section 1401) A meeting may be called at any time by
the Trustee under the Indenture, and also, upon request, by the Company or the
Holder of at least 10% in principal amount of the Outstanding Securities of such
series, in any such case upon notice given in accordance with "Notices" below.
(Section 1402) Persons entitled to vote a majority in principal amount of the
Outstanding Securities of a series will constitute a quorum at a meeting of
Holders of Securities of such series, except that in the absence of a quorum, if
the meeting was called by the Company or the Trustee, it will be adjourned for a
period of not less than 10 days, and in the absence of a quorum at any such
adjourned meeting, the meeting will be further adjourned for a period of not
less than 10 days. Except for any consent which must be given by the Holder of
each Outstanding Security affected thereby, as described above under
"Modification of the Indenture", and subject to provisions described in the last
sentence under this subheading, any resolution presented at a meeting or
adjourned meeting duly reconvened at which a quorum is present may be adopted by
the affirmative vote of the Holders of a majority in principal amount of the
Outstanding Securities of that series; PROVIDED HOWEVER, that any resolution
with respect to any request, demand, authorization, direction, notice, consent,
waiver or other action which may be made, given or taken by the Holders of a
specified percentage, which is equal to or less than a majority, in principal
amount of Outstanding Securities of a series may be adopted at a meeting or
adjourned meeting duly reconvened at which a quorum is present by the
affirmative vote of the Holders of such specified percentage in principal amount
of the Outstanding Securities of that series. Any resolution passed or decision
taken at any meeting of Holders of Securities of any series duly held in
accordance with the Indenture will be binding on all Holders of Securities of
that series and the related coupons. With respect to any consent, waiver or
other action which the Indenture expressly provides may be given by the Holders
of a specified percentage of Outstanding Securities of all series affected
thereby (acting as one class), only the principal amount of Outstanding
Securities of any series represented at a meeting or adjourned meeting duly
reconvened at which a quorum is present as aforesaid and voting in favor of such
action will be counted for purposes of calculating the aggregate principal
amount of Outstanding Securities of all series affected thereby favoring such
action. (Section 1404)
NOTICES
Except as otherwise provided in the Indenture, notices to Holders of Bearer
Securities will be given by publication at least once in a daily newspaper in
New York City and in London and in such other city or cities as may be specified
in such Bearer Securities and will be mailed to such Persons whose names and
addresses were previously filed with the Trustee, within the time prescribed for
the giving of such notice. Notices to Holders of Registered Securities will be
given by mail to the addresses of such Holders as they appear in the Security
Register. (Section 106)
TITLE
Title to any Bearer Securities and any coupons appertaining thereto will
pass by delivery. The Company, the Trustee and any agent of the Company or the
Trustee may treat the bearer of any Bearer Security or related coupon and the
registered owner of any Registered Security (including Registered Securities in
global registered form) as the absolute owner thereof (whether or not such
Security or coupon shall be overdue and notwithstanding any notice to the
contrary) for the purpose of making payment and for all other purposes. (Section
407)
REPLACEMENT OF SECURITIES AND COUPONS
Any mutilated Security and any Security with a mutilated coupon appertaining
thereto will be replaced by the Company at the expense of the Holder upon
surrender of such mutilated Security or Security with a mutilated coupon to the
Trustee. Securities or coupons that become destroyed, stolen or
12
<PAGE>
lost will be replaced by the Company at the expense of the Holder upon delivery
to the Trustee of evidence of the destruction, loss or theft thereof
satisfactory to the Company and the Trustee; in the case of any coupon which
becomes destroyed, stolen or lost, such coupon will be replaced (upon surrender
to the Trustee of the Security with all appurtenant coupons not destroyed,
stolen or lost) by issuance of a new Security in exchange for the Security to
which such coupon appertains. In the case of a destroyed, lost or stolen
Security or coupon an indemnity satisfactory to the Trustee and the Company may
be required at the expense of the Holder of such Security or coupon before a
replacement Security will be issued. (Section 405)
SATISFACTION AND DISCHARGE; DEFEASANCE
At the request of the Company, the Indenture will cease to be in effect as
to the Securities of any series (except for certain obligations of the Company
to register the transfer or exchange of such Securities and related coupons, if
any, and hold moneys for payment of such Securities and coupons in trust) when
either (a) all such Securities and coupons have been delivered to the Trustee
for cancelation, or (b) such Securities and coupons have become due and payable
or will become due and payable at their stated maturity within one year or are
to be called for redemption within one year, and the Company has deposited with
the Trustee, in trust, money, in the currency, currencies or currency unit or
units in which such Securities are payable, in an amount sufficient to pay all
the principal of, and premium and interest, if any, on, such Securities on the
dates such payments are due in accordance with the terms of such Securities.
(Section 501)
Unless the applicable Prospectus Supplement provides otherwise, the Company
at its option (a) will be deemed Discharged from any and all obligations in
respect to the Securities of a series (except for certain obligations with
respect to such Securities to register the transfer or exchange of Securities
and related coupons, if any, replace stolen, lost or mutilated Securities and
coupons, maintain paying agencies and hold moneys for payment in trust) or (b)
need not comply with certain restrictive covenants in the Indenture (including
those described above under "Covenants--LIMITATIONS ON LIENS") with respect to
such Securities, in each case after the Company deposits with the Trustee, in
trust, money, or, in the case of Securities and coupons denominated in U.S.
dollars, U.S. Government Obligations or, in the case of Securities and coupons
denominated in a foreign currency, Foreign Government Securities, which through
the payment of interest thereon and principal thereof in accordance with their
terms will provide money in an amount sufficient to pay in the currency,
currencies or currency unit or units in which such Securities are payable all
the principal of, and premium and interest, if any, on such Securities on the
dates such payments are due in accordance with the terms of such Securities.
Among the conditions to the Company's exercising any such option, the Company is
required to deliver to the Trustee an opinion of counsel to the effect that the
deposit and related defeasance would not cause the Holders of such Securities to
recognize income, gain or loss for United States Federal income tax purposes and
that the Holders will be subject to United States Federal income tax in the same
amounts, in the same manner and at the same times as would have been the case if
such option had not been exercised. (Section 503)
GOVERNING LAW
The Indenture, the Securities and the coupons will be governed by, and
construed in accordance with, the laws of the State of New York. (Section 112)
CONCERNING THE TRUSTEE
The Company may from time to time maintain lines of credit, and have other
customary banking relationships, with The Chase Manhattan Bank (National
Association), the Trustee under the Indenture.
13
<PAGE>
PLAN OF DISTRIBUTION
The Company may sell the Securities in any of three ways: (i) through
underwriters; (ii) through agents; or (iii) directly to purchasers. The
Prospectus Supplement with respect to each series of Securities will set forth
the terms of the offering of the Securities of such series, including the name
or names of any underwriters, the purchase price and the proceeds to the Company
from such sale, and underwriting discounts and other items constituting
underwriters' compensation, the initial public offering price and any discounts
or concessions allowed or reallowed or paid to dealers, and any securities
exchanges on which the Securities of such series may be listed.
If underwriters are used in the sale, the Securities will be acquired by the
underwriters for their own account and may be resold from time to time in one or
more transactions, including negotiated transactions, at a fixed public offering
price or at varying prices determined at the time of sale. The Securities may be
either offered to the public through underwriting syndicates represented by
managing underwriters or by underwriters without a syndicate. Unless otherwise
set forth in the Prospectus Supplement, the obligations of the underwriters to
purchase Securities will be subject to certain conditions precedent and the
underwriters will be obliged to purchase all the Securities of a series if any
are purchased. Any initial public offering price and any discounts or
concessions allowed or reallowed or paid to dealers may be changed from time to
time.
Securities may be sold directly by the Company or through agents designated
by the Company from time to time. Any agent 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 obligated to use its reasonable efforts to solicit offers
to purchase Securities for the period of its appointment.
As one of the means of direct issuance of the Securities, the Company may
utilize an electronic auction of Securities to purchasers eligible to
participate in such auctions, as such auctions may be described in the
applicable Prospectus Supplement.
If so indicated in the Prospectus Supplement, the Company will authorize
agents, underwriters or dealers to solicit offers by certain specified
institutions to purchase Securities from the Company at the public offering
price set forth in the Prospectus Supplement pursuant to delayed delivery
contracts providing for payment and delivery on a specified date in the future.
Such contracts will be subject only to those conditions set forth in the
Prospectus Supplement, and the Prospectus Supplement will set forth the
commissions payable for solicitation of such contracts.
Agents and underwriters may be entitled under agreements entered into with
the Company to indemnification by the Company against certain civil liabilities,
including liabilities under the Securities Act of 1933, or to contribution with
respect to payments which the agents or underwriters may be required to make in
respect thereof. Agents and underwriters may be customers of, engage in
transactions with, or perform services for, the Company in the ordinary course
of business.
Securities in bearer form are subject to U.S. tax law requirements and may
be not offered, sold or delivered within the United States or to a U.S. person,
except in certain transactions permitted by U.S. tax regulations. Terms used in
this paragraph have the meanings given to them by the U.S. Internal Revenue Code
and regulations thereunder.
Each underwriter, dealer and agent participating in the distribution of any
Securities that are issuable in bearer form will agree that, except as permitted
by its agreement with the Company (or with another underwriter, pursuant to that
underwriter's agreement with the Company) it will not offer, sell or deliver
such Securities, (i) as part of their distribution at any time or (ii) otherwise
until 40 days after the closing date for such Securities, within the United
States or to, or for the account or benefit of, U.S. persons.
14
<PAGE>
Each series of Securities will be a new issue of securities with no
established trading market. Any underwriters to whom Securities are sold by the
Company for public offering and sale may make a market in such Securities, but
such underwriters will not be obligated to do so and may discontinue any market
making at any time without notice. No assurance can be given as to the liquidity
of the trading market for any Securities.
EXPERTS
The consolidated financial statements of the Company incorporated in this
Prospectus by reference to the Annual Report on Form 10-K for the year ended
December 31, 1996 have been so incorporated in reliance on the report of Price
Waterhouse LLP, independent accountants, given on the authority of said firm as
experts in auditing and accounting.
15
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following statement sets forth the estimated amounts of expenses, other
than underwriting or agency discounts or commissions, to be borne by the Company
in connection with the distribution of the Debt Securities registered hereby:
<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee............. $1,060,607
Trustee's Fees.................................................. 25,000
Printing and Engraving Expenses................................. 120,000
Rating Agency Fees.............................................. 150,000
Accounting Fees and Expenses.................................... 40,000
Legal Fees and Expenses......................................... 50,000
Blue Sky Fees and Expenses...................................... 50,000
Listing Fees.................................................... 70,000
Miscellaneous Expenses.......................................... 17,500
---------
Total Expenses........................................... $1,583,107
---------
---------
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Reference is made to Section 145 of the General Corporation Law of Delaware.
ITEM 16. EXHIBITS.
<TABLE>
<C> <S>
(1)(a) --Form of Underwriting Agreement (incorporated by reference to Exhibit 1(a) to
the Company's Current Report on Form 8-K dated November 9, 1990,
electronically transmitted to the Securities and Exchange Commission on
November 9, 1990).
(b) --Form of Agency Agreement dated March 13, 1992, as amended August 12, 1992,
April 13, 1993, June 11, 1993, August 17, 1993, January 6, 1994, November
17, 1994 and August 8, 1996 among the Company, CS First Boston Corporation,
Goldman Sachs & Co., Lehman Brothers, Lehman Special Securities Inc., Lehman
Brothers Inc., Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Morgan Stanley & Co. Incorporated, Salomon Brothers Inc, and
Smith Barney Inc. as Agents (incorporated by reference to Exhibit 1 to the
Company's Current Report on Form 8-K dated March 13, 1992, electronically
transmitted to the Securities and Exchange Commission on March 13, 1992,
incorporated by reference to Exhibit 1 to the Company's Current Report on
Form 8-K dated August 12, 1992, electronically transmitted to the Securities
and Exchange Commission on August 12, 1992, incorporated by reference to
Exhibit 1 to the Company's Current Report on Form 8-K dated April 13, 1993,
electronically transmitted to the Securities and Exchange Commission on
April 13, 1993, incorporated by reference to Exhibit 1 to the Company's
Current Report on Form 8-K dated June 11, 1993, electronically transmitted
to the Securities and Exchange Commission on June 11, 1993, incorporated by
reference to Exhibit 1 to the Company's Current Report on Form 8-K dated
August 17, 1993, electronically transmitted to the Securities and Exchange
Commission on August 17, 1993, incorporated by reference to Exhibit 1 to the
Company's Current Report on Form 8-K dated November 17, 1994, electronically
transmitted to the Securities and Exchange Commission on November 18, 1994
and incorporated by reference to Exhibit 1 to the Company's Current Report
on Form 8-K dated and electronically transmitted to the Securities and
Exchange Commission on August 9, 1996).
</TABLE>
II-1
<PAGE>
<TABLE>
<C> <S>
(4)(a) --Form of Indenture dated as of January 15, 1989, between the Company and The
Chase Manhattan Bank (National Association), as Trustee (incorporated by
reference to Exhibit 4 to Amendment No. 1 to the Company's Registration
Statement on Form S-3 (Registration No. 33-27339) ("Amendment No. 1"),
electronically transmitted to the Securities and Exchange Commission on
April 3, 1989).
(b) --First Supplemental Indenture dated as of April 29, 1997 to Indenture dated
as of January 15, 1989 between the Company and The Chase Manhattan Bank
(National Association).*
(c) --Form of Fixed Rate Non-Redeemable Medium-Term Note (incorporated by
reference to Exhibit 4(a) to Amendment No. 1).
(d) --Form of Fixed Rate Redeemable Medium-Term Note (incorporated by reference to
Exhibit 4(b) to Amendment No. 1).
(e) --Form of Floating Rate Non-Redeemable Medium-Term Note (incorporated by
reference to Exhibit 4(c) to Amendment No. 1).
(f) --Form of Fixed Rate Security with Optional Redemption (incorporated by
reference to Exhibit 4(g) to Amendment No. 1).
(g) --Form of Fixed Rate Security with Optional Redemption and Sinking Fund
(incorporated by reference to Exhibit 4(h) to Amendment No. 1).
(h) --Form of Extendible Security with Optional Redemption (incorporated by
reference to Exhibit 4(i) to Amendment No. 1).
(i) --Form of Zero Coupon Security with Optional Redemption (incorporated by
reference to Exhibit 4(j) to Amendment No. 1).
(j) --Form of Original Issue Discount Security with Optional Redemption
(incorporated by reference to Exhibit 4(k) to Amendment No. 1).
(5) --Opinion of John J. Shay, Jr., Esq.*
(12) --Computation of Ratio of Earnings to Fixed Charges.*
(23)(a) --Consent of Price Waterhouse LLP.*
(b) --Consent of Counsel (included in Exhibit 5).*
(24)(a) --Power of Attorney of W. Wilson Lowery, Jr. (incorporated by reference to
Exhibit IV(a) to the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1995, electronically transmitted to the Securities
and Exchange Commission on March 18, 1996).
(b) --Power of Attorney of Jeffrey D. Serkes (incorporated by reference to Exhibit
IV(j) to the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995, electronically transmitted to the Securities and Exchange
Commission on March 18, 1996).
(c) --Power of Attorney of Kimberly A. Kispert.*
(25) --Statement of Eligibility and Qualification on Form T-1 of The Chase
Manhattan Bank (National Association) to act as Trustee under the
Indenture.*
</TABLE>
- ------------------------
* Filed electronically herewith.
ITEM 17. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement (other than as
provided in the proviso and instructions to Item 512(a) of Regulation S-K)
(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 the 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 the
registration statement; and (iii) to include any material information with
respect to the plan of distribution not previously disclosed in the
registration statement or any material change to such information in the
registration statement.
II-2
<PAGE>
(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.
(4) 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 the 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 described in Item 15 above, 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 officer, director 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 of whether or not
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-3
<PAGE>
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 White Plains, State of New York, on the 30th day of
April, 1997.
IBM CREDIT CORPORATION
By *
-----------------------------------------
Vice President, Finance, Treasurer and
Controller
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
President and Chairman
* of the Board
- ------------------------------------------- (Principal Executive
(W. Wilson Lowery, Jr.) Officer)
<C> <S> <C> <C>
Vice President, Finance,
Treasurer, Controller
* and Director
- ------------------------------------------- (Principal Financial
(Kimberly A. Kispert) and Accounting April 30,
Officer) 1997
*
- ------------------------------------------- Director
(Jeffrey D. Serkes)
</TABLE>
*By: /s/ JOHN J. SHAY, JR.
-------------------------
(John J. Shay, Jr.,
ATTORNEY-IN-FACT)
II-4
<PAGE>
DESCRIPTION OF EXHIBITS
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER
- ---------
<S> <C> <C>
(1)(a) -- Form of Underwriting Agreement (incorporated by reference to Exhibit 1(a) to the Company's Current
Report on Form 8-K dated November 9, 1990, electronically transmitted to the Securities and Exchange
Commission on November 9, 1990).
(b) -- Form of Agency Agreement dated March 13, 1992, as amended August 12, 1992, April 13, 1993, June 11,
1993, August 17, 1993, January 6, 1994, November 17, 1994 and August 8, 1996 among the Company, CS
First Boston Corporation, Goldman Sachs & Co., Lehman Brothers, Lehman Special Securities Inc.,
Lehman Brothers Inc., Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Morgan Stanley & Co. Incorporated, Salomon Brothers Inc, and Smith Barney Inc. as Agents
(incorporated by reference to Exhibit 1 to the Company's Current Report on Form 8-K dated March 13,
1992, electronically transmitted to the Securities and Exchange Commission on March 13, 1992,
incorporated by reference to Exhibit 1 to the Company's Current Report on Form 8-K dated August 12,
1992, electronically transmitted to the Securities and Exchange Commission on August 12, 1992,
incorporated by reference to Exhibit 1 to the Company's Current Report on Form 8-K dated April 13,
1993, electronically transmitted to the Securities and Exchange Commission on April 13, 1993,
incorporated by reference to Exhibit 1 to the Company's Current Report on Form 8-K dated June 11,
1993, electronically transmitted to the Securities and Exchange Commission on June 11, 1993,
incorporated by reference to Exhibit 1 to the Company's Current Report on Form 8-K dated August 17,
1993, electronically transmitted to the Securities and Exchange Commission on August 17, 1993,
incorporated by reference to Exhibit 1 to the Company's Current Report on Form 8-K dated November
17, 1994, electronically transmitted to the Securities and Exchange Commission on November 18, 1994
and incorporated by reference to Exhibit 1 to the Company's Current Report on Form 8-K dated and
electronically transmitted to the Securities and Exchange Commission on August 9, 1996).
(4)(a) -- Form of Indenture dated as of January 15, 1989, between the Company and The Chase Manhattan Bank
(National Association), as Trustee (incorporated by reference to Exhibit 4 to Amendment No. 1 to the
Company's Registration Statement on Form S-3 (Registration No. 33-27339) ("Amendment No. 1"),
electronically transmitted to the Securities and Exchange Commission on April 3, 1989).
(b) -- First Supplemental Indenture dated as of April 29, 1997, to Indenture dated as of January 15, 1989
between the Company and The Chase Manhattan Bank (National Association).*
(c) -- Form of Fixed Rate Non-Redeemable Medium-Term Note (incorporated by reference to Exhibit 4(a) to
Amendment No. 1).
(d) -- Form of Fixed Rate Redeemable Medium-Term Note (incorporated by reference to Exhibit 4(b) to
Amendment No. 1).
(e) -- Form of Floating Rate Non-Redeemable Medium-Term Note (incorporated by reference to Exhibit 4(c) to
Amendment No. 1).
(f) -- Form of Fixed Rate Security with Optional Redemption (incorporated by reference to Exhibit 4(g) to
Amendment No. 1).
(g) -- Form of Fixed Rate Security with Optional Redemption and Sinking Fund (incorporated by reference to
Exhibit 4(h) to Amendment No. 1).
(h) -- Form of Extendible Security with Optional Redemption (incorporated by reference to Exhibit 4(i) to
Amendment No. 1).
(i) -- Form of Zero Coupon Security with Optional Redemption (incorporated by reference to Exhibit 4(j) to
Amendment No. 1).
(j) -- Form of Original Issue Discount Security with Optional Redemption (incorporated by reference to
Exhibit 4(k) to Amendment No. 1).
(5) -- Opinion of John J. Shay, Jr., Esq.*
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER
- ---------
<S> <C> <C>
(12) -- Computation of Ratio of Earnings to Fixed Charges.*
(23)(a) -- Consent of Price Waterhouse LLP.*
(b) -- Consent of Counsel (included in Exhibit 5).*
(24)(a) -- Power of Attorney of W. Wilson Lowery, Jr. (incorporated by reference to Exhibit IV(a) to the
Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995, electronically
transmitted to the Securities and Exchange Commission on March 18, 1996).
(b) -- Power of Attorney of Jeffrey D. Serkes (incorporated by reference to Exhibit IV(j) to the Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 1995, electronically transmitted
to the Securities and Exchange Commission on March 18, 1996).
(c) -- Power of Attorney of Kimberly A. Kispert.*
(25) -- Statement of Eligibility and Qualification on Form T-1 of The Chase Manhattan Bank (National
Association) to act as Trustee under the Indenture.*
</TABLE>
- -------------------
* Filed electronically herewith.
<PAGE>
FIRST SUPPLEMENTAL INDENTURE dated as of April 29, 1997, between IBM CREDIT
CORPORATION, a corporation duly organized and existing under the laws of
Delaware (herein called the "Company") having its principal office at 1133
Westchester Avenue, White Plains, New York 10604, and THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION), a national banking association organized and existing
under the laws of the United States of America, as Trustee (herein called the
"Trustee").
RECITALS OF THE COMPANY
The Company and the Trustee are parties to an Indenture dated as of January
15, 1989 (the "Indenture") relating to the issuance from time to time by the
Company of its Securities. Capitalized terms used herein, not otherwise
defined, shall have the same meanings given them in the Indenture.
The Company has requested the Trustee to join with it in the execution and
delivery of this first supplemental indenture (the "First Supplemental
Indenture") in order to supplement and amend the Indenture, with respect to
Securities outstanding under series created after the date hereof, to increase
the amount of secured indebtedness that the Company is permitted to incur.
Section 1001 of the Indenture provides that a supplemental indenture may be
entered into by the Company and the Trustee, without the consent of any
Holders, provided that such supplemental indenture does not adversely affect
the interests of the Holders of Securities Outstanding of any series.
The Company has determined that this First Supplemental Indenture complies
with said Section 1001 and does not require the consent of any Holders.
All things necessary to make this First Supplemental Indenture a valid
agreement of the Company and the Trustee, in accordance with the terms of the
Indenture, and a valid amendment of and supplement to the Indenture have been
done.
NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of Securities by
the Holders thereof, it is mutually agreed, for the equal and ratable benefit
of all Holders of Securities of any series created after the date hereof, as
follows:
I. AMENDMENT TO THE INDENTURE
<PAGE>
Section 1104 of the Indenture is amended, with respect to Securities
outstanding under series created after the date hereof, to replace the number
"5%" with "10%" in the seventeenth line of Section 1104.
II. GENERAL PROVISIONS
A. The recitals contained herein shall be taken as the statements of the
Company, and the Trustee assumes no responsibility for the correctness of
same. The Trustee makes no representation as to the validly of this First
Supplemental Indenture. The Indenture, as supplemented and amended by this
First Supplemental Indenture, is in all respects hereby adopted, ratified and
confirmed.
B. This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
C. This First Supplemental Indenture shall be governed by and construed in
accordance with the laws of the State of New York.
IBM CREDIT CORPORATION
By:________________________________
Kimberly A. Kispert
Vice President, Finance
(SEAL)
Attest:
- --------------------------------------
THE CHASE MANHATTAN BANK,
(National Association), as Trustee,
By:________________________________
Name:
Title:
(SEAL)
Attest:
- -------------------------------------
<PAGE>
EXHIBIT 5
APRIL 30, 1997
IBM CREDIT CORPORATION
Dear Sirs:
As Vice President, General Counsel and Secretary for IBM Credit Corporation,
a Delaware corporation (hereinafter called the "Company"), I am giving this
opinion in connection with the proposed issuance of up to $3,984,000,000
principal amount of debt securities (the "Debt Securities") of the Company to be
issued under an Indenture dated as of January 15, 1989, as amended or
supplemented (the "Indenture"), between the Company and The Chase Manhattan Bank
(National Association), as Trustee (the "Trustee").
I have examined originals, or copies certified or otherwise identified to my
satisfaction, of such documents, corporate records and other instruments as I
have deemed necessary for the purposes of this opinion, including: (a) the
Certificate of Incorporation of the Company; (b) the By-laws of the Company; and
(c) the Indenture.
Based upon the foregoing, I am of the opinion as follows:
1. The Company has been duly incorporated and is a validly existing
corporation under the laws of the State of Delaware.
2. Assuming that the Indenture has been duly executed and delivered by the
Company and the Trustee and that the Debt Securities have been duly authorized,
executed and delivered on behalf of the Company in accordance with the
Indenture, authenticated by the Trustee and sold by the Company, the Debt
Securities will constitute valid and binding obligations of the Company and will
be entitled to the benefits of the Indenture (subject to applicable bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or other laws
affecting creditors' rights generally from time to time in effect).
I understand that I may be referred to, as counsel who has passed upon the
validity of the Debt Securities on behalf of the Company, in a supplement to the
Prospectus forming a part of the Registration Statement on Form S-3 relating to
the Debt Securities filed with the Securities and Exchange Commission pursuant
to the Securities Act of 1933, and I hereby consent to such use of my name in
said Registration Statement and to the use of this opinion for filing with said
Registration Statement as Exhibit 5 thereto.
Very truly yours,
JOHN J. SHAY, JR.
IBM Credit Corporation,
1133 Westchester Avenue
White Plains, New York 10604
<PAGE>
EXHIBIT 12
IBM CREDIT CORPORATION
STATEMENT RE COMPUTATION OF RATIOS
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
MARCH 31, YEAR ENDED DECEMBER 31,
-------------- ----------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1997 1996 1995 1994 1993 1992
-------------- ---------- ---------- ---------- ---------- ----------
Fixed Charges:
Interest expense................................ $ 112,966 $ 436,109 $ 394,572 $ 306,125 $ 365,675 $ 445,816
Approximate portion of rental expense
representative of the interest factor......... 69 479 507 2,780 3,290 3,078
-------------- ---------- ---------- ---------- ---------- ----------
Total fixed charges............................. 113,035 436,588 395,079 308,905 368,965 448,894
Net earnings.................................... 79,183 271,082 230,475 250,589 220,220 219,270
Provision for income taxes...................... 51,497 176,122 149,455 162,703 173,172 131,562
-------------- ---------- ---------- ---------- ---------- ----------
-------------- ---------- ---------- ---------- ---------- ----------
Earnings before income taxes and fixed
charges....................................... $ 130,680 $ 883,792 $ 775,009 $ 722,197 $ 762,357 $ 799,726
-------------- ---------- ---------- ---------- ---------- ----------
-------------- ---------- ---------- ---------- ---------- ----------
Ratio of earnings to fixed charges.............. 2.16 2.02 1.96 2.34 2.07 1.78
-------------- ---------- ---------- ---------- ---------- ----------
-------------- ---------- ---------- ---------- ---------- ----------
</TABLE>
<PAGE>
EXHIBIT 23 (a)
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
January 20, 1997 (except as to the Subsequent Event note on page 38, which is as
of January 24, 1997) appearing on page 14 of IBM Credit Corporation's Annual
Report on Form 10-K for the year ended December 31, 1996. We also consent to the
reference to us under the heading "Experts" in such Prospectus.
PRICE WATERHOUSE LLP
Stamford, CT
April 30, 1997
<PAGE>
EXHIBIT 24(c)
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned director of IBM Credit
Corporation, a Delaware corporation, which expects to file with the Securities
and Exchange Commission, Washington, D.C., under provisions of the Securities
Laws, an Annual Report on Form 10-K, and Registration Statements for amounts of
debentures and notes to be determined by the Board of Directors, hereby appoints
the Chairman; Vice-President, Finance; Secretary; and any Assistant Secretary of
said corporation; and each of such officers individually, her attorney-in-fact
and agent, for her and in her name, to sign, or cause to be signed
electronically, said 10-K and Registration Statements and amendments thereto,
and to file them with the Securities and Exchange Commission, hereby granting
unto said attorneys-in-fact and agents, and each of them, full power to do any
and all acts and things as fully as she might or could do in person. This
authorization shall remain in force throughout the period that the undersigned
is a director of IBM Credit Corporation.
IN WITNESS WHEREOF, the undersigned has executed this Power of Attorney this
18th day of April, 1997.
/s/ KIMBERLY A. KISPERT
--------------------------------------
Name: Kimberly A. Kispert
Title: Director
<PAGE>
-----------------------------------------------------------
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) ________
---------------------------------------
THE CHASE MANHATTAN BANK
(Exact name of trustee as specified in its charter)
New York 13-4994650
(State of incorporation (I.R.S. employer
if not a national bank) identification No.)
270 Park Avenue
New York, New York 10017
(Address of principal executive offices) (Zip Code)
William H. McDavid
General Counsel
270 Park Avenue
New York, New York 10017
Tel: (212) 270-2611
(Name, address and telephone number of agent for service)
--------------------------------------
IBM CREDIT CORPORATION
(Exact name of obligor as specified in its charter)
Delaware 22-2351962
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification No.)
1133 Westchester Avenue
White Plains, New York 10604
(Address of principal executive offices) (Zip Code)
-----------------------------
Debt Securities
(Title of the indenture securities)
---------------------------------------------------
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
New York State Banking Department, State House, Albany, New York
12110.
Board of Governors of the Federal Reserve System, Washington, D.C.,
20551
Federal Reserve Bank of New York, District No. 2, 33 Liberty
Street, New York, N.Y.
Federal Deposit Insurance Corporation, Washington, D.C., 20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with the Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
-2-
<PAGE>
Item 16. List of Exhibits
List below all exhibits filed as a part of this Statement of
Eligibility.
1. A copy of the Articles of Association of the Trustee as now in
effect, including the Organization Certificate and the Certificates of
Amendment dated February 17, 1969, August 31, 1977, December 31, 1980,
September 9, 1982, February 28, 1985, December 2, 1991 and July 10, 1996 (see
Exhibit 1 to Form T-1 filed in connection with Registration Statement No.
333-06249, which is incorporated by reference).
2. A copy of the Certificate of Authority of the Trustee to Commence
Business (see Exhibit 2 to Form T-1 filed in connection with Registration
Statement No. 33-50010, which is incorporated by reference. On July 14, 1996,
in connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
3. None, authorization to exercise corporate trust powers being
contained in the documents identified above as Exhibits 1 and 2.
4. A copy of the existing By-Laws of the Trustee (see Exhibit 4 to
Form T-1 filed in connection with Registration Statement No. 333-06249, which
is incorporated by reference).
5. Not applicable.
6. The consent of the Trustee required by Section 321(b) of the Act
(see Exhibit 6 to Form T-1 filed in connection with Registration Statement
No. 33-50010, which is incorporated by reference. On July 14, 1996, in
connection with the merger of Chemical Bank and The Chase Manhattan Bank
(National Association), Chemical Bank, the surviving corporation, was renamed
The Chase Manhattan Bank).
7. A copy of the latest report of condition of the Trustee, published
pursuant to law or the requirements of its supervising or examining authority.
8. Not applicable.
9. Not applicable.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
Trustee, The Chase Manhattan Bank, a corporation organized and existing under
the laws of the State of New York, has duly caused this statement of eligibility
to be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of New York and State of New York, on the 29th day of April, 1997.
THE CHASE MANHATTAN BANK
By /s/James D. Heaney
-------------------
/s/James D. Heaney
Vice President
-3-
<PAGE>
Exhibit 7 to Form T-1
BANK CALL NOTICE
RESERVE DISTRICT NO. 2
CONSOLIDATED REPORT OF CONDITION OF
The Chase Manhattan Bank
of 270 Park Avenue, New York, New York 10017
and Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System,
at the close of business December 31, 1996, in
accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
DOLLAR AMOUNTS
ASSETS IN MILLIONS
- ------------------------------------------------------------------------------ --------------
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin.......................... $ 11,509
Interest-bearing balances................................................... 8,457
Securities:...................................................................
Held to maturity securities................................................... 3,128
Available for sale securities................................................. 40,534
Federal Funds sold and securities purchased under agreements to resell in
domestic offices of the bank and of its Edge and Agreement subsidiaries, and
in IBF's:
Federal funds sold.......................................................... 9,222
Securities purchased under agreements to resell............................. 422
Loans and lease financing receivables:
Loans and leases, net of unearned income $133,935
Less: Allowance for loan and lease losses 2,789
Less: Allocated transfer risk reserve........... 16
Loans and leases, net of unearned income, allowance, and reserve............ 131,130
Trading Assets................................................................ 49,876
Premises and fixed assets (including capitalized leases)...................... 2,877
Other real estate owned....................................................... 290
Investments in unconsolidated subsidiaries and associated companies........... 124
Customer's liability to this bank on acceptances outstanding.................. 2,313
Intangible assets............................................................. 1,316
Other assets.................................................................. 11,231
--------------
TOTAL ASSETS.................................................................. $ 272,429
--------------
--------------
-4-
<PAGE>
LIABILITIES
Deposits
In domestic offices......................................................... $ 87,006
Noninterest-bearing......................................................... $ 35,783
Interest-bearing............................................................ 51,223
In foreign offices, Edge and Agreement subsidiaries, and IBF's.............. 73,206
Noninterest-bearing......................................................... $ 4,347
Interest-bearing............................................................ 68,859
Federal funds purchased and securities sold under agree-ments to repurchase in
domestic offices of the bank and of its Edge and Agreement subsidiaries, and
in IBF's
Federal funds purchased..................................................... 14,980
Securities sold under agreements to repurchase.............................. 10,125
Demand notes issued to the U.S. Treasury...................................... 1,867
Trading liabilities........................................................... 34,783
Other Borrowed money:
With a remaining maturity of one year or less............................... 14,639
With a remaining maturity of more than one year............................. 425
Mortgage indebtedness and obligations under capitalized leases................ 40
Bank's liability on acceptances executed and outstanding...................... 2,267
Subordinated notes and debentures............................................. 5,471
Other liabilities............................................................. 11,343
TOTAL LIABILITIES............................................................. 256,152
Limited-Life Preferred stock and related surplus.............................. 550
EQUITY CAPITAL
Common stock.................................................................. 1,251
Surplus....................................................................... 10,243
Undivided profits and capital reserves........................................ 4,526
Net unrealized holding gains (Losses) on available-for-sale securities........ (309)
Cumulative foreign currency translation adjustments........................... 16
TOTAL EQUITY CAPITAL.......................................................... 15,727
--------------
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED STOCK AND EQUITY CAPITAL............ $ 272,429
--------------
--------------
</TABLE>
I, Joseph L. Sclafani, S.V.P. & Controller of the above-named bank, do
hereby declare that this Report of Condition has been prepared in conformance
with the instructions issued by the appropriate Federal regulatory authority and
is true to the best of my knowledge and belief.
JOSEPH L. SCLAFANI
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us, and to the best of our
knowledge and belief has been prepared in conformance with the in- structions
issued by the appropriate Federal regulatory authority and is true and correct.
WALTER V. SHIPLEY )
EDWARD D. MILLER ) DIRECTORS
THOMAS G. LABRECQUE )
